October 2013: Meeting Minimum Service Standards in Health and Education Through Innovation in Indonesia

In many developing countries, planning and budgeting processes suffer from serious inefficiencies due to the inability to properly cost the provision of services. In many of Indonesia’s cities and districts, the unreliability of data combined with uneven management and opaque budgeting and procurement practices, often leads to inaccurate health and education services budgeting.

Under the auspices of the Foreign Affairs, Trade and Development Canada (formerly the Canadian International Development Agency)-funded Better Approaches to Service Provision through Improved Capacities in Sulawesi (BASICS) Project, and in partnership with national, provincial and district/city governments partners, Cowater International, has developed an innovative costing instrument designed to improve budgeting practices among government bodies, leading to strengthened health and education service planning. The instrument, comprised of software and standard operating procedures (SOPs), has been piloted in seven cities/districts in the health sector of North Sulawesi.  The costing instrument will be used as the basis for applying the province’s special allocation fund to accelerate the achievement of health-related Millennium Development Goals (MDGs) and minimum services. Demonstrating its success, the Provincial Development and Planning Agency (BAPPEDA) has mandated its use in all districts/cities in North Sulawesi as part of the 2014 annual budgeting process in the health sector. A version to support costing of basic education services is currently being developed, in collaboration with national, Southeast Sulawesi and district/city government partners.

Utilization of the unit costing instruments in both provinces should facilitate more accurate and realistic education and health services plans and budgets. Additionally, the instruments, which include an “accessibility coefficient”, will support more effective costing of services in hard-to-reach areas where significant service provision gaps have historically existed.  Demonstrating its potential for scalability and replication, the health services unit cost tool is currently being considered for national-level application due to the favourable appraisal by the Government of Indonesia.

Stephanie Sprott, M.A., B.A (Hons.) – Project Officer, Social Development Group