Increase health spending to 2.5% of GDP, says 15th FC chairman N K Singh

Bats for a PPP model to address the deficit in health infrastructure

The Fifteenth Finance Commission (15th FC) Chairman, N K Singh, on Wednesday said the combined public sector spending on health should go up to 2.5 per cent of gross domestic product (GDP) by 2024. The call comes as the Covid-19 pandemic continues 

to overwhelm the already-stretched health care infrastructure of the country and puts pressure on state governments that are at the forefront of the battle against Covid-19.

Singh said the recently submitted finance commission report outlines how the public private partnership (PPP) model can address the deficit in India’s health infrastructure.

“There is no doubt that public sector spending, both by the Centre and states, needs to go up very significantly. We need to aim to increase the health expenditure to 2.5 per cent of GDP, as envisaged in the 2017 health policy from the current 0.95 per cent of GDP. States also need to increase their health outlay,” said Singh during a panel discussion at Health Asia 2020 organised by the Confederation of Indian Industry (CII).

The 15th FC last week submitted its report ‘Finance Commission in Covid Times’ for the five-year period beginning 2021-22 to President Ram Nath Kovind, while copies were presented to Prime Minister Narendra Modi and Finance Minister Nirmala Sitharaman.

“The report will turn out to be a shining example of advocating PPP in the health sector once it is in the public domain. You will find all the components — state, ministry, research organisations and private sector,” said Singh. He added that district hospitals can become great grounds for training paramedics, creating health and employment multipliers. The former Rajya Sabha member and bureaucrat also emphasised on the need to create a cadre for medical officers as mentioned in the All India Services Act 1951.

“The All-India health service has not been constituted. It is needed to address many of these issues… and prioritising the health sector,” Singh said.

He called for a more holistic approach to encouraging PPP in the health sector. “There should be a constant working relationship… and the government should not resort to the private sector in the case of an emergency only. This deficit needs to be bridged.”

Highlighting the poor and skewed distribution of the health care infrastructure in the country, Singh said there was a need to immediately broaden the scope of medical courses in India. He added the government must put in place a regulatory framework for paramedics in the upcoming session of Parliament and give recognition to frontline workers for playing a critical role in battling the Covid-19 pandemic. 

Randeep Guleria, Director, All India Institute of Medical Sciences (AIIMS), said there was a need to develop a comprehensive plan to build a uniform quality of medical education across the country to avoid disparity in the payment of salaries.