Evidence and Experience of Procurement in Health Sector Decentralisation

Improving the efficiency, effectiveness, equity and responsiveness of supply chains and procurement processes for pharmaceuticals, vaccines and other health products, which make up a large share of total health expenditure in low and middle-income countries (LMICs), has important implications for health system performance and population health. Decentralised governance of health services provides greater autonomy in planning, management and decision making from national to sub-national level and has occurred in many LMICs largely as a response to the primary healthcare approach promoted by international agencies. Evidence suggests that procurement is more efficient when centralised because of economies of scale and improved purchasing power whilst other health system functions such as financing and planning/budgeting benefit more from local context-specific implementation. Nepal is embarking on a process of decentralisation after adopting a federal approach to local governance. This helpdesk report looks at other countries to summarise key findings and lessons learnt from decentralised procurement.