The World Bank's "no blanket policy"
The World Bank has been a major player in influencing user fee policies throughout the developing world. In the 1980s it was a major proponent of user fees for health services, but by 2004 it was advocating "no blanket policy on user fees" – see the 2004 World Development Report (WDR), Making services work for poor people (especially chapter 4). The Bank acknowledges that user fees in a lot of cases have led to exclusion of poor people and recommends that the situation has to be analysed in each policy context and decision-makers have to choose from a variety of options regarding user fees.
How should policy-makers determine when user fees are appropriate, and what kind of complementary measures are needed to protect the poor? The report suggests that the decision should balance three goals: protection of the poor, efficiency in allocation, and the ability to guarantee that services can be implemented and sustained. In particular, it recommends that services should be free to all when any of the following conditions apply:
- when services are not "excludable" – this covers services such as pest control or sanitation which benefit everyone in a community or area;
- when services can be given at a minimal "lifeline" rate to all, with higher levels charged for;
- when services are disproportionately used by the poor, and are likely to be delivered adequately without user fees, and will not be overused – this includes low cost primary healthcare; antenatal care; immunisation; and low cost treatment for priority diseases.
If it is possible to distinguish the poor from the non-poor, then the Report recommends waivers, exemptions, cash transfers or vouchers wherever they are feasible. But if it is not possible to distinguish the poor from the non-poor, then under certain conditions the report argues that user fees should be charged to everyone.
progress in implementing the World Bank’s policy on user fees remains slow and uneven
Despite this framework for making decisions, having "no blanket policy" means that some difficult questions are left to be answered at the individual country level. How inadequate do funds have to be for user fees to be justified? What proportion of poor users is sufficient to justify a blanket exemption? The framework can be interpreted in a variety of ways, depending on definitions, approaches to measurement, and available data.
Underlying the Bank's approach is a belief that as well as creating additional funding, user fees help to establish a market relationship between provider and client which can empower the client. One way of sustaining such a relationship is the distribution of vouchers to pay for public services, giving poor people an earmarked but tangible purchasing power with which to exercise their rights as consumers. If a choice of providers is available then the poor become active "players" who are able to demand minimum standards of quality of care.
The report also argues that vouchers may be better in targeting the poor than other public health subsidies, of which a disproportionate share is often captured by the better-off. (Also see Increasing client's power to scale up health services for the poor: the Bamako Initiative in West Africa.)
Critics of the World Bank's approach have argued that, while the decision-making framework suggests removing fees for primary healthcare, very few countries have yet gone ahead with this. User fees: the right to health and education denied observes that progress in implementing the Bank’s policy changes on user fees remains slow and uneven, and calls for it to move towards a clear position against user fees and provide the support that is needed for country governments to abolish them.
Recommended reading on the World Bank's policy
