The research organisation Unnayan Onneshan (UO) said on Saturday the declining allocation for health and education might hinder the achievement of the country's development targets.
The independent multidisciplinary think-tank in its post-budget issue of the monthly Bangladesh Economic Update observes that expenditure on health and education in Bangladesh was quite low compared to other developing countries.
The monthly review says allocation for non-development expenditure in both the sectors comprised a large portion of the total allocation, resulting in inadequate allocation for development expenditure.
"In addition, poor implementation status of Annual Development Programme (ADP) under the Ministry of Health and Family Planning and the Ministry of Education poses challenges to development of these two sectors."
In view of the current challenges to development of health and education sectors, the think-tank finds three major issues that characterise the two sectors-structural inequality emanating from socioeconomic differentials, lack of universal coverage while providing social services and social inequality due to lack of access of citizens to the social services.
The research organisation says Bangladesh lags behind other developing countries in accumulating public spending adequately to provide its citizens with necessary social services while the allocation for social sectors, particularly education and health, as the percentage of total programme expenditure have been on the decline in recent years.
Statistics shows that the budgetary allocation for education and technology declined by 1.5 percentage point and proposed at 11.6 per cent of the total budget outlay in the FY 2015-16 compared to 13.1 per cent in the FY 2014-15.
Allocation for health also declined by 0.1 percentage point from 4.4 per cent of the total budget in the FY 2014-15 to 4.3 per cent in the FY 2015-16.
The think-tank finds that Bangladesh lags behind other developing countries in health expenditure in terms of the percentage of GDP.
In 2013 the actual allocation for health in Bangladesh stood at only 3.7 per cent whereas it was 4.0 per cent in India, 6.0 per cent in Vietnam, 6.0 per cent in Nepal, 7.5 per cent in Cambodia, and 10.8 per cent in the Maldives.
Consequently, the per capita health expenditure is also quite low in Bangladesh compared to other developing economies. For instance, the per capita health expenditure in Bangladesh stood at US$ 32 while it was US$ 61 in India, US$ 111 in Vietnam, US$ 39 in Nepal, US$ 76 in Cambodia, and US$ 720 in the Maldives.
The UO further shows that the out-of-pocket health expenditure as percentage of private expenditure on health is much higher in Bangladesh than other developing countries.
In 2013, the out-of-pocket health expenditure as percentage of private expenditure on health was 93 per cent in Bangladesh compared to 85.9 per cent in India, 85 per cent in Vietnam, 81.4 per cent in Nepal, 75.1 per cent in Cambodia, and 88.3 per cent in Maldives.
The research organisation also shows that in 2013, public spending stood at 32.21 per cent of GDP in the developing and emerging economies whereas Bangladesh accumulated only 16.79 per cent of its GDP as public spending.
The volume of public spending is far lower in Bangladesh than its two neighbouring countries - India and Myanmar, whose public spending as percentage of GDP reached 27.26 per cent and 27.18 per cent respectively in 2013.
Statistics suggest that the actual allocations as percentage of the total programme expenditure for education and technology were 17.1 per cent, 16.9 per cent, 18.6 per cent, 18.4 per cent, 16.6 per cent, and 16.1 per cent in FY 08, FY 09, FY 10, FY 11, FY 12 and FY 13 respectively.
In FY 14, the revised allocation stood at 16.3 per cent, whereas in FY 15, the budgetary allocation stood at 15.6 per cent.
As per the projection, the allocation may stand at 15.5 and 15.6 per cent in the FY 16 and FY 17 respectively.
The think-tank shows that the actual allocation for health as percentage of the total programme expenditure was 7.2 per cent, 7.1 per cent, 7.3 per cent, 7.1 per cent, 6.6 per cent and 6.4 per cent in FY 08, FY 09, FY 10, FY 11, FY 12 and FY 13 respectively.
In the FY 14, the revised allocation stood at 5.7 per cent whereas in FY 15 the budgetary allocation stood at 5.3 per cent. The allocation is projected to stand at 5.3 and 5.4 per cent in the FY 16 and FY 17 respectively.
Referring to the substantial gap between the allocations for non-development and development budgets on health and education, the think-tank shows that in the FY 2015-16, Tk 66.81 billion has been allocated as non-development expenditure on health compared to Tk 53.24 billion as development expenditure.
In the same vein, Tk 200.44 billion has been allocated as non-development expenditure on education and technology in the FY 2015-16 while development expenditure has stood at Tk 121.26 billion.
Noting the poor implementation status of ADP in health and education sectors, the think-tank finds that during the first 11 months of the FY 2014-15 the implementation of revised ADP had been only 56 per cent under the ministry of health and family planning and 64 per cent under the ministry of education.
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