Prashant Raymus CEHAT, MUMBAI raymusprashant@gmail.com prashant@cehat.org

1. Maharashtra’s Health Budget : A Macro Perspective Seminar on "Maharashtra's Budget 2011: A Scrutiny of Development Discourse"  25 March 2011 Prashant Raymus CEHAT, MUMBAI raymusprashant@gmail.com prashant@cehat.org

2. Fiscal Health of the Maharashtra State • GSDP Growth Rate 13.74 % for last 10 years • Surplus/deficit indicators For year 2006-07 , 2007-08 & 2008-09 surplus of revenue over expenditure i.e Rs. 810, 14,803 & 5,577 crore respectively. for year 2009-10 surplus of Rs. 8,006 . Maharashtra enacted the Maharashtra FRBM Act in April 2005 moved towards reducing deficit

3. Revenue receipts • States Revenue receipts (Tax1 and Non Tax revenue2) as % of GSDP for year 2007-08 is 11.41 and later years decline to 9.05 % • The State’s Own tax revenue remain stagnant around 7.6% of GSDP for 3 years and last year declined to 7.17 % . The expected State’s Own tax revenue has not grown in response to increasing GSDP. • The States focus on Non-tax sources (Non-tax revenues largely comprise Interest receipts, and receipts from General, Social, and Economic services) to mobilise greater revenues this has performed well in 2006-07, increased from 2.26 ( in 2005-06) to 3.15 (2006-07) percent of GSDP by introducing suitable reforms of improved cost recovery.

4. Expenditure Economic Services Agriculture and allied services , Rural development, Special programmes for hill Areas, Irrigation and Flood control, Energy , Industry and Minerals , Transport, Science Technology and Environment and Secretariat of department of Economic Services. • Share of development oriented program is 80 % and other expenditure only around 14 %. • Economic services expenditure increased at a Growth rate of 16.80 % and its share as percentage of Total expenditure increased from 19.72 to 30.81% for year 2001-02 to 2004-05 , in 2008-09 shown a drastic increase to 35 % • With NSDP shows the growth rate of 11.43 for last eight year, the economic services as per centage of NSDP has shown an increasing trend from 3.61 to 5.5 % in 2001-02 to 2008-09

5. Social Services • Social services expenditure showed a growth rate of 8.40 % and as per centage of NSDP remain stagnant around 5.5% for 2002-3 to 2006-07 years and later decline • State with higher rate of economic growth , intra–state distribution of income inequality stay very high • Standard Deviation of per capita NDDP for the all district [of Maharashtra (excluding the Mumbai), the dispersion increase from 0.28 in 1993-94 to 0.33 in 2006-07 • Close look at these values indicates that aggregate inequality did not rise much till 1997, but there has been rise during the last few years ie from 2001-02 till 2006-07 • While inter district income differences are high, state investment in social sectors would help to offset the imbalance of income disparity. But as we have seen earlier this has not happened

6. Public Sector Health Care Financing and Expenditure • Health is a ‘state’ subject. States account for nearly 80 per cent of all public expenditure on health and the rest being borne by central government expenditure and tied grants to the state • Total government health care expenditureincreased from Rs 1,775 crore in 2001-02 to Rs. 4,961 crore in 2009-10 (Actual). For 2010-11 ( RE) is Rs. 4,961 crores and 2011-12 ( BE) is Rs. crore • In real terms Rs 1,090 crore in 2001-02 to Rs. 3,036 crore in 2009-10 (using 2004-05 as the base year). This shows a 9 % per year real increase but the overall government spending also increased at the that rate 10.45 % in real terms

7. Public Health Expenditure , Maharashtra (Rs. in crore) • Health expenditure as percent to total Social Services expenditure, For two years ( 2007-08 & 2008-09) it moved up a little but a closer look indicates the share of centrally sponsored schemes/Central plan schemes contribution in the total health expenditure increased from 10.8 per cent in 2003-04 to 13 percent in 2008-09, indicating state abducting its role of welfare state.

8. Distribution of the health resources in district • exclusively “supply-side considerations” (i.e., the existing supply of infrastructure and personnel). • As of 2009, CAG report observes, against the additional requirement of 2,627 Sub Centres, 394 PHCs and 95 CHCs to be set up during the Mission period, construction of only 161 Sub-Centres was completed and no new PHCs and CHCs were set up during 2005-09. Table

9. Conclude: • Maharashtra needs to increase the health budget substantially at least upto 3% of NSDP on the average as mandated by the NRHM to be able to provide quality public health care • when we are talking about effective delivery of currently mandated health services as per government policy. State government planning authority need to take serious action for removing regional imbalance and for maintaining inter-district equity while making provisions for health services.