BUDGET EXECUTION Marion Jane Cros IN HEALTH: FROM Fatima El Kadiri El Yamani Michel Muvudi BOTTLENECKS TO Aminata TOU Nana SOLUTIONS CASE STUDY SERIES DEMOCRATIC REPUBLIC OF CONGO Cover images: Upper © Dusit/Adobe Stock Lower © World Bank-Vincent Tremeau Health, Nutrition and Population (HNP) Discussion Paper BUDGET EXECUTION IN HEALTH: FROM BOTTLENECKS TO SOLUTIONS CASE STUDY SERIES DEMOCRATIC REPUBLIC OF CONGO Marion Jane Cros Fatima El Kadiri El Yamani Senior Health Specialist, Health, Nutrition and Population Senior Health Economist, Health, Nutrition and Population Global Practice, World Bank, New Delhi, India Global Practice, World Bank, Kinshasa, Democratic Republic of Congo Michel Muvudi Senior Health Specialist, Health, Nutrition and Population Aminata TOU Nana Global Practice, World Bank, Kinshasa, Consultant, Democratic Republic of Congo Democratic Republic of Congo ABSTRACT: The Democratic Republic of Congo is committed to achieving Universal Health Care by 2030. Progress toward this goal faces challenges due to limitations in the execution and allocation of the country’s health budget. This contributes to health spending being predominantly financed by households and donors rather than the government. The only part of the government health budget that is consistently executed in line with allocations is for health worker payments. Execution rates for other spending categories are volatile and generally low. Many parts of the budget are not executed at all, while some activities are implemented without having been included in the budget. Budget execution within the Ministry of Health is influenced by both internal and external factors. Inconsistencies between strategic planning, budget preparation, and execution processes hinder effective financial management; inaccurate cost estimations; heavy reliance on exceptional procedures for spending and over-execution of specific budget lines to the detriment of otherwise planned activities. External challenges include a systematic over-estimation of national revenue; the highly centralized nature of budget execution processes; the dominance of health worker payments in budget allocations; the non-respect of budget management rules and cumbersome procurement and expenditure execution procedures. Disclaimer: The findings, interpretations, and conclusions expressed in the paper are entirely those of the authors, and do not represent the views of the World Bank, its Executive Directors, or the countries they represent. Correspondence Details: Marion Cros mcros@worldbank.org Budget execution in health: from bottlenecks to solutions © The International Bank for Reconstruction and Development / The World Bank, 2025 1818 H Street NW Washington DC 20433 Telephone: 202-473-1000 Internet: www.worldbank.org This work is a product of the staff of The World Bank with external contributions. The findings, interpretations, and conclusions expressed in this work do not necessarily reflect the views of The World Bank, its Board of Executive Directors, or the governments they represent. The World Bank does not guarantee the accuracy, completeness, or currency of the data included in this work and does not assume responsibility for any errors, omissions, or discrepancies in the information, or liability with respect to the use of or failure to use the information, methods, processes, or conclusions set forth. The boundaries, colors, denominations, and other information shown on any map in this work do not imply any judgment on the part of The World Bank concerning the legal status of any territory or the endorsement or acceptance of such boundaries. Nothing herein shall constitute or be construed or considered to be a limitation upon or waiver of the privileges and immunities of The World Bank, all of which are specifically reserved. Rights and Permissions The material in this work is subject to copyright. Because The World Bank encourages dissemination of its knowledge, this work may be reproduced, in whole or in part, for noncommercial purposes as long as full attribution to this work is given. Any queries on rights and licenses, including subsidiary rights, should be addressed to World Bank Publications, The World Bank, 1818 H Street NW, Washington, DC 20433, USA; fax: 202-522-2625; e-mail: pubrights@worldbank.org. Graphic design. David Lloyd Design (DLD). Unless otherwise credited, all images used in this report were created in part with Midjourney AI and overlayed with graphics created by DLD. Any resemblence to a real individual is accidental. This interactive document has been optimised for use on computers and tablets in portrait orientation. Click on this square to return to the contents page SECTION NAME Click on this section to return to the beginning of the section CONTENTS CONTENTS ACKNOWLEDGMENTSII 1. HEALTH FINANCING CONTEXT 01 2. BUDGET EXECUTION IN HEALTH 05 3. PUBLIC FINANCIAL MANAGEMENT CONTROLS FOR HEALTH SPENDING 10 4. GOOD PRACTICES AND BOTTLENECKS 16 REFERENCES20 LIST OF FIGURES FIGURE 1: DEMOCRATIC REPUBLIC OF CONGO HEALTH FINANCING SOURCES, 2016-21 02 FIGURE 2: HEALTH SECTOR FINANCIAL FLOWS IN DEMOCRATIC REPUBLIC OF CONGO 03 FIGURE 3: HEALTH BUDGET EXECUTION RATE, 2016-20 06 FIGURE 4: EXECUTION BY HEALTH EXPENDITURE TYPE, 2016-20 07 FIGURE 5: CAPITAL EXPENDITURE EXECUTION BY FUNDING SOURCE, 2016-20 08 LIST OF TABLES TABLE 1: HEALTH SECTOR EXPENDITURE CONTROLS 11 TABLE 2: CHANGES IN EXPENDITURE CONTROLS DURING COVID-19 15 TABLE 3: SUMMARY OF BUDGET EXECUTION GOOD PRACTICES AND BOTTLENECKS IN DEMOCRATIC REPUBLIC OF CONGO 17 BUDGET EXECUTION IN HEALTH: FROM BOTTLENECKS TO SOLUTIONS - CASE STUDY SERIES - DEMOCRATIC REPUBLIC OF CONGO i ACKNOWLEDGMENTS ACKNOWLEDGMENTS This study is part of a broader analytical collaboration between the World Health Organization (WHO) and the World Bank to address budget execution problems in the health sector. The study’s findings feed into a synthesis report, which is released concurrently: Budget Execution in Health: From Bottlenecks to Solutions. This study was authored by the Democratic Republic of Congo (DRC) World Bank team, including Marion Jane Cros (Senior Health Specialist), Fatima El Kadiri El Yamani (Senior Economist), Michel Muvudi (Senior Health Specialist), and Aminata TOU Nana (Consultant). It follows a case study protocol developed by Hélène Barroy (Senior Health Finance Specialist, WHO), Moritz Piatti-Fünfkirchen (Senior Economist, World Bank), and Amna Silim (Senior Consultant). Quality assurance was provided by Hamish Colquhoun (Senior Consultant) and Moritz Piatti-Fünfkirchen (Senior Economist). Technical editing and communication support was provided by Zac Mills (Senior Consultant), Hamish Colquhoun (Senior Consultant), Clementine Murer (Program Analyst), and Alexandra Michele Beith (Senior Consultant). The study benefitted from management oversight by Agnès Couffinhal (Global Program Lead for Health Financing) and Monique Vledder (Practice Manager, HNP). It was made possible through generous financial support from the Global Financing Facility (GFF). The authors are grateful to the World Bank for publishing this report as an HNP Discussion Paper. ii BUDGET EXECUTION IN HEALTH: FROM BOTTLENECKS TO SOLUTIONS - CASE STUDY SERIES - DEMOCRATIC REPUBLIC OF CONGO 1.0 HEALTH FINANCING CONTEXT HEALTH FINANCING CONTEXT The Democratic Republic of Congo payments are the main source of health facility (DRC) is committed to achieving income. Collectively, household payments Universal Health Coverage (UHC) by 2030. and donor grants comprised over 80 percent This target requires ensuring all people of total health spending from 2016 to 2021 (see have access to quality healthcare without Figure 1). Government financing comprised financial hardship. The government’s 10‑16 percent of total health spending in the strategic objectives for the sector are set same period. out in the National Health Development Plan 1 2019–2022. This plan is complemented Total spending on health is far below the by a 2019 Health Financing Strategy which estimated levels required to achieve UHC. defines the mechanisms for improving the Total health expenditure ranged from US$19 mobilization and effective utilization of to US$222 from 2013 to 2019 and reached resources for the health sector. 3.65 percent of gross domestic product (GDP) in 2020. This is far below the US$86 per capita Spending on health is predominantly financed and 5 percent of GDP estimated by international by households and donors. Direct household studies to achieve UHC.3 Figure 1 Democratic Republic of Congo Health Financing Sources, 2016–21 100.00% 5.45% 4.00% 5.00% 3.00% 4.00% 3.00% 12.00% 10.00% 16.00% 16.00% 16.00% 15.00% 80.00% 42.00% 35.00% 39.00% 37.00% 38.00% 60.00% 43.10% 40.00% 20.00% 39.45% 44.00% 45.00% 42.00% 43.00% 43.00% 0.00% 2016 2017 2018 2019 2020 2021 l Households l Donors l Public administration l Companies, NGOs, National Foundations Source: Ministry of Health: National Health Accounts Report 2021.  lan National de Développement Sanitaire (PNDS). 1P  overnment of the Democratic Republic of Congo. 2021. National Health Accounts Report 2021 (Comptes Nationaux de la Santé 2G 2021). Kinshasa: Ministry of Health.  cIntyre and Meheus (2014) quoted in World Bank (2021) DRC Health Financing Reform for UHC: Fiscal Space Analysis. Note: 3M US$86 in 2012 terms. 02 BUDGET EXECUTION IN HEALTH: FROM BOTTLENECKS TO SOLUTIONS - CASE STUDY SERIES - DEMOCRATIC REPUBLIC OF CONGO HEALTH FINANCING CONTEXT While the health sector budget allocation has and health centers out-of-pocket for increased in recent years, the increase is primarily consultations, medicines, tests, and hospitalization. due to donor resources. Overall, the proportion Donor resources are channeled to providers through of the government’s total budget allocation that is development projects (off-budget) or through earmarked for the health sector increased from central and provincial government structures 6.6 to 11 percent from 2016 to 2021. However, when (on-budget direct transfer payments for service considering only the government’s own resources providers of health centers4 allocations). (i.e., excluding donor allocations captured in the Government resources are transferred through budget), the allocation increase was more modest multiple mechanisms both as financial flows (from 6.6 to 7.4 percent over the same timeframe). (principally remunerations for health workers) Public resource allocation for health, therefore, and in-kind (including the provision of medicines). remains below half the Abuja Declaration target Private sector resources, nongovernmental of 15 percent. Gaps in resource mobilization are resources, and a tiny portion of donor resources— compounded by less-than-adequate budget collectively representing about 3 percent of total execution: in 2019, only 57 percent of the health health expenditure—are transferred to public budget was spent. community-based insurance schemes (i.e., mutuelles), which in turn purchase health Resource flows are fragmented (see Figure 2). services from providers. Households pay the service providers at hospitals Figure 2 Health Sector Financial Flows in Democratic Republic of Congo Provincial Government Central Government NGOs Donors Households Budgets Budgets Health Services Mutuelles Purchasing Agency Provider A Provider B Provider C Provider D Source: Ministry of Health: National Health Accounts Report 2021. 4 Formations sanitaires (FOSA). BUDGET EXECUTION IN HEALTH: FROM BOTTLENECKS TO SOLUTIONS - CASE STUDY SERIES - DEMOCRATIC REPUBLIC OF CONGO 03 HEALTH FINANCING CONTEXT Public management of the health sector is framework. However, budget execution decentralized in theory but remains highly processes do not yet utilize the program-based centralized in practice. In theory, healthcare structure, so it currently serves a reporting provision is the responsibility of the provinces. function only. The World Bank and European In practice, the management of resources for Union also support public corporations that the sector remains almost entirely under the purchase health services in about 3,000 health control of the central government. Health facilities. The public corporations agree on worker payments and other recurrent spending service cost, sign provider purchase contracts, are made by the central government on behalf and pay based on negotiated rates and of the provinces. Large allocations are included performance criteria such as the number of in the annual budget for capital spending patients treated for certain preventive services. resources to be transferred to the provinces. In practice, most of these allocations are not Discussions are ongoing to create a national released (or when partially executed, they again health insurance scheme. The details of its reflect capital spending implemented by the implementation remain unclear, particularly central government on behalf of the provinces). whether it would subsidize the poorest in the informal sector. (In the formal sector, mutuelles Mechanisms have been established for cover the police, the army, and teachers, among linking on-budget donor financing to specific others.) The government plans to create a service delivery results, but gaps remain in National Health Solidarity Fund to purchase terms of operationalization. In 2016, the health services; yet, no institutional or financial government established a program-based feasibility study has been conducted to explore budget, linking health budget allocations to how to establish and manage the fund (e.g., the strategic health plan. Monitoring exercises health services to be offered, population to are undertaken to assess the delivery of the be covered—including mechanisms to exempt strategic plan based on this reporting the poorest informal sector households). 04 BUDGET EXECUTION IN HEALTH: FROM BOTTLENECKS TO SOLUTIONS - CASE STUDY SERIES - DEMOCRATIC REPUBLIC OF CONGO 2.0 BUDGET EXECUTION IN HEALTH BUDGET EXECUTION IN HEALTH The overall execution rate for the health when compared with the revised budget budget is modest. Over 2016–20, the (see Figure 3). This health budget execution average health sector budget execution rate rate was considerably lower than for overall was 47.6 percent of initial budget allocations. government spending, which averaged The average execution rate was 68 percent 80 percent. Figure 3 Budget execution rate compared with initial budget Health Budget Execution Rate, 2016–20 Budget execution rate compared with revised budget 96.0% 200% 77% 150% 56% 68% 97.0% 43% 100% 43% 77% 50% 56% 34% 0% 2016 2017 2018 2019 2020 Source: World Bank 2025, based on General Directorate of Budget Policies and Programming: Budget Monitoring Statements 2016-2020 and Budget Execution Laws 2016-2020. Execution rates differ substantially by budget (consistently below 20 percent) are the least category and by year. Health worker payments funded. The execution rate for other operational average a 103 percent execution rate. Execution spending varied significantly, dropping to just rates for other spending categories decrease 30 percent in 2020. The overall health budget and vary significantly (see Figure 4). Notably the execution rate with health worker payments execution rates for transfers to provinces excluded averaged 48 percent (relative to the (consistently below 5 percent) and hospitals revised budget allocation). 06 BUDGET EXECUTION IN HEALTH: FROM BOTTLENECKS TO SOLUTIONS - CASE STUDY SERIES - DEMOCRATIC REPUBLIC OF CONGO BUDGET EXECUTION IN HEALTH Figure 4 Execution by Health Expenditure Type, 2016–20 150 100 Percentage 50 14 4 4 6 3 0 2016 2017 2018 2019 2020 l Total l Personnel costs l Other operational costs l Transfers to reference hospitals etc. l Medicines and medical supplies l Capital costs l ETD transfers Source: World Bank 2025, based on General Directorate of Budget Policies and Programming: Budget Monitoring Statements 2016-2020 and Budget Execution Laws 2016-2020. Variability in execution rates is even more Capital spending is inadequately executed, extreme when considering more with further variation if disaggregating disaggregated budget categories. For between internal and external financing. example, in 2019, only six of the Ministry of The average execution rate for internally Health’s over 50 divisions and programs financed capital spending was just 19 percent achieved any execution of their budgets but a slightly higher 38 percent for externally for running costs. The Office of the Minister financed capital spending. From 2016 to 2018, of Health, however, over-executed its budget domestic capital spending was close to zero with a rate of 205 percent. In the same year, executed, with the execution rate improving the allocations for hospital running costs were modestly in 2019 and 2020 (see Figure 5). not executed for a single hospital. BUDGET EXECUTION IN HEALTH: FROM BOTTLENECKS TO SOLUTIONS - CASE STUDY SERIES - DEMOCRATIC REPUBLIC OF CONGO 07 BUDGET EXECUTION IN HEALTH Figure 5 l External resources l Capital expenses Capital Expenditure Execution by Funding Source, 2016–20 l Own resources 100% 90% 80% 70% 60% 50% 40% 30% 20% 10% 0% 2016 2,017 2018 2,019 2020 Source: World Bank 2025, based on General Directorate of Budget Policies and Programming: Budget Monitoring Statements 2016-2020 and Budget Execution Laws 2016-2020. Budget controls are largely bypassed. Many capacity within the Ministry of Health to manage areas of actual spending are for activities that efficiently, leading to delays and under-execution. were not included in the voted budget, while the majority of activities actually planned for are not The root causes of poor health sector executed. For example, in 2019, US$6.3 million budget execution that are external to the was spent on purchasing vaccines and inputs for Ministry of Health include: blood transfusions despite the lack of any budget allocation for this activity. Further, no ■ Over-estimation of budget revenue. retrospective exercise was undertaken to account Revenue projections in the budget are for this spending in a revised budget. based on political considerations rather than on realistic economic and social A major part of the government health budget assumptions or historical resource is externally financed, creating challenges for mobilization performance. They tend execution. Donor financing is included in the to be systematically overestimated, health budget in a non-exhaustive and, at times, leading to low execution rates. inconsistent manner. The ineffective execution rate for external financing is explained by actual ■ Highly centralized budget execution challenges in executing the resources and, given processes. All phases of the budget that most of the resources are executed outside execution process remain managed by of government systems, by the difficulty of the Ministry of Budget and the Ministry accessing the data on execution. Donor execution of Finance. The Ministry of Health has no varies and often differs from the government’s delegated authority to execute its own own processes. Donor processes can be budget. This reform has been legislated administratively heavy and beyond the available for but not yet implemented. 08 BUDGET EXECUTION IN HEALTH: FROM BOTTLENECKS TO SOLUTIONS - CASE STUDY SERIES - DEMOCRATIC REPUBLIC OF CONGO BUDGET EXECUTION IN HEALTH ■ Dominance of health worker payments for aligning budget allocations to strategic in budget allocations. Health worker priorities in response to requests. Budget payments are prioritized in budget execution allocations instead tend to be based on the processes. These payments make up 60 previous year’s allocations, with limited percent of total health budget spending considerations of prior execution and, excluding donor resources, an even performance or changed priorities. higher percentage of domestic financing. The prioritization of these payments in the ■ Budget credibility. Costs for specific execution process reduces the ability to activities are inaccurately estimated, leading execute other categories of expenditure. to challenges in execution as available resources differ from required resources. ■ Disregard for budget management rules. Some government institutions systematically ■ Nonstandard budget execution spend beyond their budget allocations. procedures. Given the challenges with This reduces the resources available for executing spending through the standard the execution of the health budget. budget procedures, most health spending is executed by bypassing these controls. ■ Cumbersome procurement and The lack of control, however, means that expenditure procedures. The process such expenditure often does not align with of executing budget items is highly programmed priorities and by using up the burdensome and time-consuming, incurring overall resources available for the sector, long delays in procurement processes. Most further reduces the possibility of executing spending is executed by bypassing these originally planned activities. controls, contributing to other challenges of execution composition and quality. ■ Over-execution of the operating budget crowds out the operating expenses of Root causes of poor health sector budget other units. Budget allocations for running execution that are internal to the Ministry costs are systematically over-executed, of Health include: which results in most other departments within the ministry being unable to access ■ Inadequate programming of the priorities their operational budgets. in the budget. The misalignment between the health planning cycle and the budget ■ Narrow health budget execution calendar is a major factor. Strategic health processes. A narrow group oversees the plans are not timed to feed into the budget resource execution processes, with minimal preparation processes and (given the non- input from other health sector stakeholders. implementation of the program budget Budget allocations and resource execution reform) their financing estimations are processes are not well communicated to the not fully integrated with the actual format impacted departments. Health sector of the government budget. This issue is stakeholders have minimal engagement in exacerbated by the lack of consideration the execution of the health sector’s budget. BUDGET EXECUTION IN HEALTH: FROM BOTTLENECKS TO SOLUTIONS - CASE STUDY SERIES - DEMOCRATIC REPUBLIC OF CONGO 09 3.0 PUBLIC FINANCIAL MANAGEMENT CONTROLS FOR HEALTH SPENDING PUBLIC FINANCIAL MANAGEMENT CONTROLS FOR HEALTH SPENDING Health expenditures are subject to both expenditure has been executed and is intended ex-ante and ex-post controls. At a general to ensure that the expenditure is genuine, legal, level, ex-ante controls are performed by the and consistent. government, including the Budget Control Directorate (Ministry of Budget), the Payment Specific controls vary for different types Authorization and Treasury Directorate (Ministry of health spending. Table 1 describes the main of Finance), and the Central Bank. These controls for each category of health spending controls aim to ensure the legality, compliance, and discusses their adequacy in practice. It also regularity, and timeliness of the expenditure. uses the example of the 2020 budget to show Ex-post control is carried out by the General the proportion of spending for each category Inspectorate of Finance, the Court of Auditors, and the number of transactions executed in and the Parliament. It takes place after the that year. Table 1: Health Sector Expenditure Controls Control Type Total Control Description Adequacy of Control Spending (2020, %) Wages and 69.6% ■ Personnel monitoring in the This control’s objective salaries quarterly payroll report by the is to identify fictitious Ministry of Health (MoH). workforce personnel, integrate omissions, and ■ Compliance verification of the adjust salary levels in line payroll directorate’s database with grade changes. The with that of the civil service. control is inadequate. (12 transactions involved) however. The objectives cannot be achieved given the lack of interface between the civil service and budget software. It does not allow for real time assessments. …table continued next page BUDGET EXECUTION IN HEALTH: FROM BOTTLENECKS TO SOLUTIONS - CASE STUDY SERIES - DEMOCRATIC REPUBLIC OF CONGO 11 PUBLIC FINANCIAL MANAGEMENT CONTROLS FOR HEALTH SPENDING Table 1: Health Sector Expenditure Controls Control Type Total Control Description Adequacy of Control Spending (2020, %) Bulk purchase 0.8% ■ Procurement level control: This process involves of drugs specification verification, supplier a fairly large number of and medical supplies certification, international checks, which lengthens ordering, and delivery. the time and can lead to delays in essential drug ■ Expenditure commitment control. provision to patients. ■ Verification of services rendered. ■ Control of appropriations availability before commitment, control of actual payment amount required, control at payment authorization level, and checking cash availability for payment. (3 transactions involved) Health facility 0.2% At the health facility level, oversight Drug procurement purchasing is carried out at the: controls at the health of drug and medical facility level are light. ■ Health zone level to monitor supplies The facilities are required compliance with quantity and to obtain supplies from type of products ordered. approved suppliers in ■ Provincial division level to check their geographical area. costs before placing orders. However, lighter control Following oversight, hospitals proceed does not guarantee with order and payment. medicine availability, as the approved suppliers are subject to lengthy national-level procedures. …table continued next page 12 BUDGET EXECUTION IN HEALTH: FROM BOTTLENECKS TO SOLUTIONS - CASE STUDY SERIES - DEMOCRATIC REPUBLIC OF CONGO PUBLIC FINANCIAL MANAGEMENT CONTROLS FOR HEALTH SPENDING Table 1: Health Sector Expenditure Controls Control Type Total Control Description Adequacy of Control Spending (2020, %) Non-wage 2.6% The control level varies depending on The multiplicity of operating the expenditure execution procedure. controls that are part costs (other than bulk For the exceptional process: checking of the normal procedure procure- that a budget line exists and that is not aligned with the ment) an amount is entered for post- objectives of improving implementation adjustment. For the health expenditure normal public expenditure procedure, levels and ensuring several levels of control exist, namely: healthcare establishment functioning. Instead, the ■ Appropriations submanager numerous transactions oversight: verifies procurement become an incentive procedure compliance, to use emergency appropriations availability, procedures that existence of all supporting result in significant documents, and expenditure extrabudgetary veracity. expenditures. ■ Budget controller level: reviews all controls already carried out by the submanagers before affixing a stamp of approval. ■ Ministry of Budget reviews all controls by the submanagers and the budget controller before committing the expenditure. ■ At the settlement level, the same checks are carried out before the file is forwarded for payment authorization. ■ Finally, for payment authorization and actual payment, the same controls are repeated. In addition, payment is subject to other controls, such as cash availability and priority to be given to said expenditure. (48 transactions involved) …table continued next page BUDGET EXECUTION IN HEALTH: FROM BOTTLENECKS TO SOLUTIONS - CASE STUDY SERIES - DEMOCRATIC REPUBLIC OF CONGO 13 PUBLIC FINANCIAL MANAGEMENT CONTROLS FOR HEALTH SPENDING Table 1: Health Sector Expenditure Controls Control Type Total Control Description Adequacy of Control Spending (2020, %) Capital 26.7% Capital expenditure controls The cumbersome Expenditures depend on the funding source procurement and the nature of the expenditure. procedure involving For expenditures financed from different levels internal resources, national of control and procurement rules are applied with intervention by several various levels of control, such as: actors from different ■ Procurement procedure oversight ministries makes it by the Ministry of Health and the difficult to achieve Ministry of Budget. efficient execution. ■ The expenditure procedure itself with repetition of the various phases of commitment, validation, payment authorization, and payment. Regarding external financing, requesting a procurement procedure “no objection” involves an additional level of control, which can lead to a long delay in execution. (13 transactions involved) Source: World Bank 2025, based on stakeholder discussions with the Ministry of Health and the Ministry of the Budget and data from the computerized expenditure chain system. Payment arrears are large but not monitored. expenditures and avoid accumulation of As of January 2021, Ministry of Health arrears payment arrears. for the 2020 budget were estimated at US$181 million. Budget management rules and The delays and incomplete payments to procedures mandate that payment arrears government suppliers are reflected in higher recorded at the end of a fiscal year be prices and challenges in securing timely recommitted in the following fiscal year for procurement. Suppliers factor in their prices payment on a priority basis. This does not the risk of nonpayment and the costs of always happen, and many commitments appear receiving late payments. Discussions with not to ever be paid. Currently, the Ministry of Ministry of Health officials suggest the premium Health lacks oversight, and the Ministry of can be as much as 50-70 percent compared Health and the Ministry of Budget do not have a to what a similar service would cost for the joint mechanism to monitor incomplete private sector. When there is a considerable 14 BUDGET EXECUTION IN HEALTH: FROM BOTTLENECKS TO SOLUTIONS - CASE STUDY SERIES - DEMOCRATIC REPUBLIC OF CONGO PUBLIC FINANCIAL MANAGEMENT CONTROLS FOR HEALTH SPENDING stock of payment arrears, especially for drugs, entailed simplified procurement procedures, the government waits to clear them before particularly for certain categories of placing additional orders, since the sector is expenditure. There were challenges in dominated by the same actors. This can impact managing pandemic-related expenditures, drug and medical equipment availability. including the use of unregulated emergency procedures for disbursing COVID-19 response Procedures expedited for COVID-19 were funds, instances of over-billing for goods well intentioned but challenging. The and services, the involvement of unauthorized government expedited some expenditures to individuals in handling funds, and an insufficient support an urgent response to and curb the justification of expenses by these individuals spread of COVID-19. Expedited procedures (see Table 2). Table 2: Changes in Expenditure Controls during COVID-19 Expenditure Change of Control for Each Change in Control Type of Control Period Wages and salaries No change and in control for salaries No change Bulk purchase of drugs Procedures streamlined and No changes in timelines and medical supplies purchases made using direct for such procedures contracting procedures Purchase of drugs and No change No change medical supplies from health facilities Non-wage operating Certain procurement expenditures Control period became costs (other than bulk made without requiring the budgetary zero days procurement) controller's prior approval Capital expenditures Some fixed assets completed without Turnaround time the use of procurement controls or reduced by two months procedures Transfers to different Resources made available directly Transfer done in one levels of government to provincial governors without week as compared to when resources used specifying the types of expenditures usual three months to finance health to be financed or the sectors to be expenditures financed Payments by purchasing No change in controls Payment delays agency to health facilities lengthened because for their services travel restrictions led to a delay in controls Source: World Bank 2025. BUDGET EXECUTION IN HEALTH: FROM BOTTLENECKS TO SOLUTIONS - CASE STUDY SERIES - DEMOCRATIC REPUBLIC OF CONGO 15 4.0 GOOD PRACTICES AND BOTTLENECKS Execution of the health budget has been highly problematic over the period of this case study’s analysis. While health worker payments are well executed (albeit often over-executed), execution rates are much more volatile across all other areas of spending. There is often a limited link between what is spent and what was originally planned in the budget. The government has made substantial effort to improve budget execution processes, with some foundations now in place. Yet, bottlenecks, including in the implementation of these good practices, remain the dominant feature of the system. These bottlenecks and good practices are set out in Table 3. GOOD PRACTICES AND BOTTLENECKS Table 3: Summary of Budget Execution Good Practices and Bottlenecks in Democratic Republic of Congo Issue Explanation Good Practices The Department of The centralized management of the health budget by the Administration and Finance has Ministry of Budget and the Ministry of Finance imposes been established within the additional execution challenges and makes it harder to Ministry of Health, such that ensure actual spending is based on the sector’s own the Ministry of Health will take priorities. The 2011 Public Finance Reform requires this on increasing responsibility management to be decentralized to the sectoral level. for the execution of its own While this reform has not yet been implemented, the budget. Ministry of Health, in collaboration with the Ministry of Budget and the Ministry Finance, has made progress in establishing and operationalizing the necessary unit for managing the health sector budget. A tripartite Health-Budget- In the interim of the Ministry of Health becoming Finance Committee has been responsible for executing its own budget, an inter- established to monitor budget ministerial committee has been established to bring execution. together the main actors responsible for health budget execution. This committee periodically analyzes the execution situation in relation to forecasts and, if necessary, proposes and monitors urgent actions for improvement. This committee still needs to be made fully operational. Program budgets have The Ministry of Health has increasingly prepared budget been introduced to improve allocations and reported budget execution using a allocative efficiency by program-based format since this reform was included in directing resources to defined the 2011 Public Finance Law. Although execution processes priorities. do not yet utilise this format, the reporting does increase the transparency of how execution challenges relate to the sector’s priorities. …table continued next page BUDGET EXECUTION IN HEALTH: FROM BOTTLENECKS TO SOLUTIONS - CASE STUDY SERIES - DEMOCRATIC REPUBLIC OF CONGO 17 GOOD PRACTICES AND BOTTLENECKS Table 3: Summary of Budget Execution Good Practices and Bottlenecks in Democratic Republic of Congo Issue Explanation Bottlenecks (Central Government-level) Unrealistic revenue forecasts Revenue forecasts are systematically over-estimated for political reasons. This causes both under-execution of the budget and leads to inconsistencies in how available resources are prioritized given the extent of the gap between the planned and actual financing available. Highly centralized budget Budget execution processes for the health sector are execution processes almost entirely managed by the Ministries of Finance and Budget. The 2010 Public Finance Law set out the process for this to be decentralized to the control of the Ministry of Health, but this reform has not yet been implemented. This centralization makes it harder for the health sector to ensure budget allocations and their in-year execution link as closely as possible to its strategic priorities. It also reduces the sector’s accountability for delivery of its own strategic targets. Non-respect of budget Certain institutions and departments systematically management rules over-execute their budget allocations by avoiding the proper controls. This makes it even more difficult for other institutions to execute their own budgets. Public procurement system A public procurement system analysis conducted in inefficiencies 2018-2022 with World Bank support highlighted the inefficiencies in the system which need to be addressed. These actions are required to reduce procurement delays and should take into account the specific characteristics of the health sector. Cumbersome and fragmented There are excessive controls on spending which are expenditure chain disproportionately applied relative to transaction sizes. In practice most health spending simply avoids going through these controls. It would be more effective to have a streamlined system of controls which is less burdensome and hence more regularly utilized. …table continued next page 18 BUDGET EXECUTION IN HEALTH: FROM BOTTLENECKS TO SOLUTIONS - CASE STUDY SERIES - DEMOCRATIC REPUBLIC OF CONGO GOOD PRACTICES AND BOTTLENECKS Table 3: Summary of Budget Execution Good Practices and Bottlenecks in Democratic Republic of Congo Issue Explanation Bottlenecks (Ministry of Health-level) Lack of integration Sector planning processes do not directly feed into budget between strategic planning preparation exercises. In-year processes determining actual processes and actual execution also make limited or no reference to strategic budget allocations priorities set out in longer term planning processes. Weak estimation of costs Many costs are now well estimated leading to inaccurate budget allocations and consequent challenges with execution. Opaque or non-inclusive There is also a lack of transparency in budget preparation health budget preparation processes from the perspective of implementing and execution processes departments and agencies, alongside limited communication on the amounts allocated and how structures should make spending requests in a timely and accurate manner. Frequent recourse to Most spending within the health sector bypasses the emergency execution normal controls. Such expenditure often does not align procedures with programmed priorities and makes the execution of planned activities more difficult. Non-systematic tracking of A large proportion of the government’s health sector external financing inputs budget is based on assumptions of external financing amounts. Most of this external financing does not utilize government execution processes making reporting on its execution time-consuming and problematic. Where data cannot be collected, the execution rate is shown as zero even if funds may have been disbursed. This distorts overall reporting on the execution of the health budget. BUDGET EXECUTION IN HEALTH: FROM BOTTLENECKS TO SOLUTIONS - CASE STUDY SERIES - DEMOCRATIC REPUBLIC OF CONGO 19 REFEERNCES REFERENCES Government of the Democratic Republic of Congo. 2019. National Development Plan 2019-2022. Kinshasa: Ministry of Health. https://p4h.world/app/uploads/2024/07/RDC_ PNDS_2022.x80726.pdf Government of the Democratic Republic of Congo. 2021. National Health Accounts Report 2021 (Comptes Nationaux de la Santé 2021). Kinshasa: Ministry of Health. https://p4h.world/ app/uploads/2024/05/CNS-RD-Congo-Synthese-de-Reponses-Financement-Sante. x80726.pdf Government of the Democratic Republic of Congo. General Directorate of Budgetary Policies and Programming: Budget Monitoring Statements 2016–2021. (Direction Générale des Politiques et Programmation Budgétaire: Etat de Suivi Budgétaire 2016–2020). Kinshasa: Ministry of Budget. Government of the Democratic Republic of Congo. General Directorate of Budgetary Policies and Programming: Finance Laws 2016-2021 and Amended Finance Laws 2016-2020 (Direction Générale des Politiques et Programmation Budgétaire : Lois de finance 2016–2021 et Lois de finance modifiées 2016–2021). Kinshasa: Ministry of Budget. World Bank. 2021. Democratic Republic of Congo Health Financing Reform for UHC: Fiscal Space Analysis. Washington DC. 20 BUDGET EXECUTION IN HEALTH: FROM BOTTLENECKS TO SOLUTIONS - CASE STUDY SERIES - DEMOCRATIC REPUBLIC OF CONGO ECO-AUDIT Environmental Benefits Statement The majority of our books are printed on Forest Stewardship Council (FSC)–certified The World Bank Group is committed to paper, with nearly all containing 50–100 reducing its environmental footprint. In percent recycled content. The recycled fiber support of this commitment, we leverage in our book paper is either unbleached or electronic publishing options and print-on- bleached using totally chlorine-free (TCF), demand technology, which is located in processed chlorine–free (PCF), or enhanced regional hubs worldwide. Together, these elemental chlorine–free (EECF) processes. initiatives enable print runs to be lowered and shipping distances decreased, resulting in More information about the Bank’s reduced paper consumption, chemical use, environmental philosophy can be found at greenhouse gas emissions, and waste. http://www.worldbank.org/ corporateresponsibility. We follow the recommended standards for paper use set by the Green Press Initiative.