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close this bookA Guide to Sector-wide Approaches for Health Development - Concepts, Issues and Working Arrangements (European Commission, 1997, 84 pages)
close this folderSector-wide approaches in practice: Components of a collaborative programme of work
View the document12 Sectoral policies and strategies
View the document13 Resource projections, spending and financing plans
View the document14 Institutional development and capacity building
View the document15 Common management arrangements

14 Institutional development and capacity building

Weak institutional capacity is one of the main constraints affecting the implementation of sector-wide approaches. Institutional reform and capacity building will therefore be central to the collaborative programme of work.

Key components

Institutional development needs to be considered in relation to:

· government capacity to lead the process of sectoral development, particularly in relation to strategic planning and policy, budgetary and financial analysis

· the development of structures, systems and incentives, in both the public and private sector, to manage health services in line with national policies

· the establishment of management systems - by governments and donor agencies - which will facilitate the introduction of common management arrangements.

The latter two components are closely related in that the systems needed to allow common management arrangements will, by definition, be essential for overall sectoral management. The reason they are separated is to acknowledge that in some countries - particularly those where major structural reforms are required or those with weak financial management systems - work under these two components may not proceed at the same pace. In other words, it may be necessary to focus on restructuring public institutions to improve performance, before worrying about common disbursement systems.

The precise agenda for institutional development under the second component will depend on national context and be determined by the content of government policies. Decentralisation and the reform of incentive systems to improve performance and local accountability are likely to be common to many reform programmes. It is also important to reiterate that institutional development cannot be restricted to public sector institutions. The development of policy and systems by which the government can influence the quality, cost and coverage of private services is an area which has been relatively neglected in many countries. Sector-wide approaches will be of little value if they become vehicles for maintaining large public sector establishments, or promoting a return to centralised planning.

The third component stresses that donors as well as governments need to review their systems for disbursement, procurement and performance monitoring if common management arrangements are to become a reality. The systems required are discussed in more detail below.