Transcript The Role of the Private Sector in the Provision of Basic Services

The Role of the
Private Sector in the
Provision of Basic
Services
Trends and Issues of Private Sector Participation in Healthcare,
Water, and Education in the ESCWA Region
Effects of Private Sector
Participation
• General trend of increasing private sector
participation
• May complement the public sector
• May be associated with a shifted or decreased
role of the public sector
• May undermine the public sector
Public Services as Human Rights
• Healthcare, water, and education as basic human
rights, necessary components of a full and
dignified life.
• In many ESCWA constitutions & Internationally
• Can the private sector provide human rights?
• Personal & public benefits
• These services are the building blocks of a strong,
prosperous country
• Focus on effects on Equity and Quality of
services
Forms of Private Sector
Participation
• Many different forms, broadly divided between
coordinated private sector participation
• Public-Private Partnerships (PPPs)
• Public-private collaboration
• And uncoordinated forms of private sector
participation
• Private entities emerge when the public sector does
not fully cover the need or demand for a particular
service.
General Risks of Private Sector
Participation
• The private sector may not consider externalities
• Two Tier System: if private services are not
available to all and public services are of a lower
quality
• Especially because the private sector may pull
resources from the public sector
• Private providers will typically cater to a urban, higherincome population
• Can aggravate inequity
General Risks of Private Sector
Participation
60
120
50
100
40
80
30
60
20
40
10
20
0
Tunis
Kasserine
0
National
Average
Rural areas
Under 5 Mortality
Rate, 2000
50
40
30
20
10
0
Urban Areas
Rural areas
Infant Mortality
Rate, 2000
Deaths per 1,000 live births
Maternal Mortality
Rate, 2003
Deaths per 1,000 live births
% Unassisted
Deliveries, 2006
35
30
25
20
15
10
5
0
Urban Areas Rural Areas
Source: World Bank. 2006. Republic of Tunisia, Health Sector Study.
• A higher quality private sector may limit the
perceived need to reform the public sector
• If public sector alternatives are completely lacking
& no state support, households may be forced to
accept catastrophic payments
General Benefits of Private Sector
Participation
• Ability to fill in gaps in the Public sector
• Conflict and low state capacity
• Support innovation & diversity
• Especially in education and health care
• Allow the public sector to concentrate on fewer
roles
• As planner, financer, distributor, and regulator
• Improve efficiency of service provision
• Water systems
Health Sector – Unique Issues
• A highly technical field, difficult for consumers to
know quality of services
• Tendency of private providers to over-test, overtreat with brand drugs and technologicallyintensive methods
• Can drive up health care expenditures
• Undermining the efficiency of the healthcare
system in Tunisia
Private Care vs. Private Expenditures in Tunisia
Preventative Care by Sector
Outpatient Visits by
Sector
Hospitalizations by
Sector
Total Health Expenditures
Private
Sector
Public
Sector
Source: WHO 2006 Country Cooperation Strategy: Tunisia
Water Sector- Unique Issues
• Most countries Water scarce
• Integrated nature of water resources
• Significant externalities
• Special need for rational management
• Significant uncoordinated private sector
participation can complicate
• Vulnerability of communities without
network coverage
Education Sector- Special Issues
• Need to both expand education system and improve
quality/relevance to job market
• Issue of private tutoring
• Higher private
sector
participation at
lower levels of
education
• Willingness to
shoulder high
payments in the
hope of high
returns
% Private Enrolment by Level, 2008
Regional Comparison
60
ESCWA
countries
50
40
Asian
Countries
30
Latin
American
Countries
20
10
0
Primary
Secondary
Tertiary
Source: World Bank, The Road Not Travelled, 2008
Steps to improve benefits & mitigate
risks of private sector participation
• Improve the legal and regulatory framework for PPPs and private
sector collaboration
• Bahrain & National Health Regulatory Authority (NHRA)
• UAE and Health Authority –Abu Dhabi (HAAD)
• Morocco and private water companies
• Limit fees of private sector operators
Expenditures, as % GDP
• Private schools in Kuwait
• Private care in Lebanon
Health Expenditures in Lebanon
14
Health expenditure %
GDP
12
10
8
Health expenditure,
private (% of GDP)
6
4
Health expenditure,
public (% of GDP)
2
0
1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010
World Bank Databank 2012
Steps to improve benefits & mitigate
risks of private sector participation
• Role of international organizations
• Can influence national policy & provide
resources and guarantee
• Unique collaborations between the private and
public sector
• TVET programs in Tunisia and Egypt
• After hour & consultant clinics in Iraq
Conclusions
When private sector participation is coupled with…
• A comprehensive government plan
• A robust legal and regulatory framework.
• Continual improvements in public sector services
and/or measures to expand access to private
services
Negative effects on equity of services can be reduced
• These principles are important regarding both coordinated
and uncoordinated private sector participation