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volume 31, issue 3, aug. 2011
1. title: bureaucrats as purchasers of health services: limitations of the public sector for contracting
authors: shehla zaidi, susannah h mayhew and natasha palmer
abstract: contracting out of health services increasingly involves a new role for governments as purchasers of services. to date, emphasis has been on contractual outcomes and the contracting process, which may benefit from improvements in developing countries, has been understudied. this article uses evidence from wide scale ngo contracting in pakistan and examines the performance of government purchasers in managing the contracting process; draws comparisons with ngo managed contracting; and identifies purchaser skills needed for contracting ngos. we found that the contracting process is complex and government purchasers struggled to manage the contracting process despite the provision of well-designed contracts and guidelines. weaknesses were seen in three areas: (i) poor capacity for managing tendering; (ii) weak public sector governance resulting in slow processes, low interest and rent seeking pressures; and (iii) mistrust between government and the ngo sector. in comparison parallel contracting ventures managed by large ngos generally resulted in faster implementation, closer contractual relationships, drew wider participation of ngos and often provided technical support. our findings do not dilute the importance of government in contracting but front the case for an independent purchasing agency, for example an experienced ngo, to manage public sector contracts for community based services with the government role instead being one of larger oversight.
2. title: sub-national government capital spending in indonesia: level, structure, and financing
authors: blane d. lewis and andr� oosterman
abstract: sub-national government capital spending is important for both public service delivery and economic development. currently, indonesian sub-national public capital spending appears barely sufficient to cover the annual depreciation of its fixed assets. a substantial proportion of local government investment spending goes to create relatively unproductive assets, such as administrative office buildings. sub-national governments finance their capital acquisitions out of gross operating budgets and have thus far not used, to any great extent, either borrowed funds or their significant cash reserves for such purposes. indonesian sub-nationals need to spend more on capital than they do now and also need to focus that spending on more useful types of infrastructure. the major constraints to increasing capital spending at the sub-national level are not related to a dearth of finance, but regulatory rigidities in budget preparation and implementation and, most importantly, a lack of capacity to plan, design and implement investment projects.
3. title: impact of decentralization reforms in pakistan on service delivery�an empirical study
authors: ghazia aslam and serdar yilmaz
abstract: by bringing decision making closer to people, decentralization is expected to improve governance and service delivery outcomes. yet, the empirical evidence on the impact of decentralization on macroeconomic performance and public sector size presents a mixed picture. however, the findings of cross-country studies in the literature are sensitive to the way decentralization is defined, and how its extent and impact are measured. this article avoids the unwanted effects of incomparability and aggregation in cross-country analysis. we use a unique panel data set from 183 villages in pakistan to analyze the impact of decentralization reforms implemented in 2001 on the provision of services�street paving, construction of water canals, sanitation sewer lines, and school facilities. our results show that the magnitude of provision of all services increased significantly following decentralization reforms. we further show that the four services are impacted differently and service delivery improvement is not uniform, but not in ways that conform to the hypotheses of patronage theory.
4. title: the meaning of development assistance
authors: peter blunt, mark turner and jana hertz
abstract: prevailing paradigms of macro-economic management and levels and distributions of poverty in some rich countries suggest that economic and strategic self-interest rather than poverty reduction in poor countries are likely to be the primary objectives of much development assistance. the incommensurability of the paradigms of development discourse makes it unlikely that strongly held ideologically based positions on these matters will change quickly or easily. moreover, non-altruistic positions can be maintained more readily by virtue of the loose construction of international declarations such as the paris declaration. based on different interpretations of the paris declaration, empirical evidence from cambodia and indonesia of donor opportunism that is designed to maximise aid control and aid distinctiveness for non-altruistic purposes is presented. recent sharp declines in donor legitimacy have made this more difficult to do, but even so, there have been no concomitant reductions in donor self-assurance concerning their exclusive possession of the moral and technical high ground. such behaviour is, however, increasingly resented particularly by government officials in lower middle-income countries like indonesia. resulting relationships lack trust and are therefore unlikely to contribute optimally either to the realisation of non-altruistic purposes or to poverty reduction.
5. title: plateaus not summits: reforming public financial management in africa
authors: stephen bovard peterson
abstract: successful public sector reform is rare in africa. over 12 years, ethiopia transformed its public financial management (pfm) to international standards and now has the third best system in africa that is managing the largest aid flows to the continent. this article presents a framework for understanding pfm reform based on the ethiopian experience. reforms succeed when they are aligned with the four drivers of public sector reform: context, ownership, purpose, and strategy. pfm is a core function of the state and its sovereignty, and it is not an appropriate arena for foreign aid intervention�governments must fully own it, which was a key to the success of ethiopia's reform. the purpose of pfm reform should be building stable and sustainable �plateaus� of pfm that are appropriate to the local context, and they should not be about risky and irrelevant �summits� of international best practice. plateaus, not summits, are needed in africa. finally, a strategy of reform has four tasks: recognize, improve, change, and sustain. ethiopia succeeded because it implemented a recognize�improve�sustain strategy to support the government policy of rapid decentralization. all too often, much of the pfm reform in africa is about the change task and climbing financial summits.
6. title: combating healthcare cost inflation with concerted administrative actions in a chinese province
authors: alex he jingwei
abstract: this article defies the traditional notion that cost inflation in healthcare could hardly be curbed without the significant revision of economic incentive scheme, but demonstrates the possibility of containing cost inflation with concerted administrative actions in the chinese context. it examines the case of fujian province that embarked on a health bureaucracy-led policy reform without an alteration of economic levers but mainly using administrative tools to combat cost escalation. through clearly defined, well designed, targeted and concerted administrative measures, effective cost containment is attainable in china's healthcare sector, at least in the short run. if combined well with the powerful economic instruments, administrative tools would be able to augment their effects in cost containment, provided with the government's possession of hospital ownership. at the heart of fujian's case are the reassertion of the government stewardship, the reconstruction of the collapsed accountability mechanisms, the reconfiguration of policy instruments, and the revision of administrative incentives, rather than the decreased costs per se.
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