Insufficient Investments in Health

CEYLON TODAY | Published: 2:00 AM Sep 14 2021

With COVID-19 Terror’s total death count standing at 11,296 as at Saturday, with 144 deaths recorded on that day alone, it appears to be that it’s only a stone’s throw away before COVID-19 terror, currently Sri Lanka’s fifth largest killer, vis-a-vis disasters, manmade or natural, post Independence 4 February 1948, will occupy the ignominious fourth place, unseating the 13,000 killings caused by the April 1971 Insurrection, that took place 50 years and five months ago, to fifth place. Consequently the then Government in 1971, which had voted a defence expenditure budget of US $ 21,042,038.717 ($ 21.04 million) in 1970 according to the World Bank (WB), upped that expenditure by 53.3 per cent ( $ 11,216,025.799 or $ 11.22 million) to $ 32,258,064.516 ($ 32,26 million) the following year in 1971.

Spending on the Sri Lanka Police is not captured here as the Police, unlike Defence, is treated as a civilian arm vis-à-vis budgetary expenditure. Meanwhile, the current COVID-19 Pandemic became fully blown in Sri Lanka in March 2020. But instead of increasing health expenditure, the Government cut down on health expenditure in 2020. Finance Ministry data showed that Health Ministry expenditure estimates, 2020 over 2019 declined by 13.79 per cent or by Rs 25,999,763,000 (Rs 26 billion) to Rs 162,576,000,000 (Rs 162.58 billion). And, as if that was not enough, Health expenditure, 2021 over 2020, further fell by 1.91 per cent (Rs 3.1 billion) to Rs 159.48 billion. 

In contrast, when the GoSL was fighting the LTTE, which war began in earnest in July 1983, before being won on 18 May 2009, the country’s annual Defence bill, one of two of the country’s topmost import bills then, if not the highest, the other being fuel, virtually year in and year out, used to top over $ one billion annually. Currently, Health is Sri Lanka’s fourth largest expenditure bill, while, among the top three, highest in descending order are Finance,’ Provincial Council and Public Services’ and Defence, respectively. 

The country’s finance bill, 2020 over 2019 increased by 32.10 per cent (Rs 299,699,878,000 or Rs 299.70 billion) to Rs 1,233,220,781,000 (Rs 1.23 trillion), before marginally falling by 2.06 per cent or by Rs 25,397,081,000 (Rs 25.4 billion) to Rs 1,044,491,530,000 (Rs 1.04 trillion), year on year (YoY) to 2021. 

It may be seen that the increase in the Finance bill, YoY to 2020, ie by a sum of Rs 299.70 billion, is equivalent to 184.34 per cent of that year’s total Health bill (Rs 162.58 billion). Or, in other words, the increase of Rs 162.58 billion of Sri Lanka’s Finance bill, over that of its total Health bill only in 2020 is equivalent to 84.34 per cent of the island’s total Health bill in the review year. Part of the reason for an excessive Finance bill is GoSL having to repay maturing foreign commercial debt, the genesis of which took place in 2007 when Sri Lanka launched its virginal international sovereign bond (ISB) issue to the value of $ 500 million in 2007 and kept up that momentum and even more, up to 2019, when it last issued an ISB in the present dispensation. 

Meanwhile, Sri Lanka’s second largest expenditure bill in the review period which was ‘Provincial Councils and Public Services,’ saw that expense, YoY to 2020 increase by 11.46 per cent to Rs 313,036,710,000 (Rs 313.04 billion), before declining by 1.86 per cent (Rs 5,813,712,000 or Rs 5.81 billion) to Rs 305,972,998,000 (Rs 305.97 billion) in 2021. 

Likewise Sri Lanka’s Defence bill, despite the end of the Tamil/LTTE war 12 years ago in 2009, 2020 over 2019 increased by 1.66 per cent (Rs 4,646,588,000 or Rs 4.65 billion) to Rs 307,775,080,000 (Rs 307.78 billion), before further increasing sharply by 8.46 per cent (Rs 23,994,264,000 or Rs 23.99 billion) to Rs 307,775,080,000 (Rs 307.78 billion) in 2021. Unless GoSL addresses these anomalies, it will be difficult for it to win not only the COVID-19 war, but by an extension its economic war as well.

CEYLON TODAY | Published: 2:00 AM Sep 14 2021

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