SIHSIPMinistry of Health, Democratic Republic of Timor Leste

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Integrated Health Accounting Manual

For practicing district and hospital managers

CONTENTS

Contents Page No

Module – 1: Financial Management – Planning1.1 Introduction 1.2 Financial Management 1.3 Background to this manual 1.4 Aims and objectives of the manual 1.5 Regulatory framework in Timor Leste 1.6 The district health management cycle 1.7 Procedure of planning in Timor Leste

1.7.1. Planning process1.7.2. Present system and difficulties

1.8 Development of operational plan1.9 Planning formats – at all levels (CHC and district)

SummaryAnnexure 1.1 – 1.5

Module 2 : Budgeting 2.1 Budgeting 2.2. What is budgeting2.3. Pre-requisites of budgeting2.4. Type of Budgets2.5. Budgetary process in Timor Leste

2.5.1. Preparation of budget2.5.2. The items that makes up the budget2.5.3. The budget process

2.6. Linkage between planning and budgeting2.7. Allocating the budget

Summary Annexure 2.1- 2.3

Module 3: Monitoring and Evaluation 3.1 Basic services package

3.1.1. MDGs and BSP3.2 Implementation of BSP

3.2.2. SISCA3.3 Hospital services package 3.4 BSP and Financing Mechanism3.5. Monitoring and supervision

Annexure 3.1 – 3.3Module 4: Budget, expenditure and Financial Management

4.1 Introduction 4.2 Execution of budget and regulatory framework

4.2.1a. Budget execution and cash management

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4.2.1b. Accounting, payments and payroll division4.2.1c. Debts, grants, asset management and system division

4.3. Budget execution 4.4. Budget codes (Chart of Accounts)4.5. Budget and free balance system 4.6. How much the districts can spent? – Financial Autonomy4.7. Concept of petty cash / imprest fund 4.8 Guidelines for distributing the fund below district level 4.9 Reporting and feedback mechanism (monthly/quarterly) at district4.10 Budget monitoring

Annexure 4.1 - 4.5Module 5: Financial Management – Processes

5.1 Financial accounting system5.1.1. Why financial accounting?5.1.2. Foundations of accounting5.1.3. Cash vs. Accrual accounting

5.2 District level financial management in Timor Leste5.2.1. Salaries5.2.2. Goods and services 5.2.3. Capital assets (Minor and Major)

5.3. In-year financial management – suggestive measures 5.3.1. What is in-year management? 5.3.2. How to manage the expenditure?5.3.3. How to manage fixed assets?

5.4. Performance evaluation 5.5 Performance reporting

5.5.1. Measuring economic efficiency5.5.2. Measuring effectiveness5.5.3. Assessing equity

5.6. Performance reporting by using DHERSummaryAnnexure 5-1 to 5.10

Glossary -1 : Definitions and technical terms (planning)Population and population projections, age and sex composition, mortality and morbidity Basic health statistics – birth and death rates, infant mortality rate, fertility, contraceptive prevalence rate, couple protection rate

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Module -1:

Financial Management – Planning

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1.1. Introduction The Democratic Republic of Timor Leste, worlds’ latest democratic country, got her independence during 1999. The actual process of constructing the nation started during the year 2000 and the formal political process started from 2002. Initial emphasis of the country was on stabilising its internal security, coupled with attempts to address other key problems such as health, education and poverty. The emphasis on health sector is envisaged from the policy documents such as National Development Plan (NDP i) and Health Policy Framework (HPFii). These documents have put increasing emphasis on the delivery of essential health care services to each population of the country. The efforts towards this end have been continuous and the current initiatives of the government are evidenced through the recent development of basic and hospital services packages and their implementation during 2008. All these taken together, gives a clear indication of the government’s commitment towards achieving the Millennium Development Goals (MDG). Such an attempt is encouraging and shows the commitment of the government towards achieving this highly ambitious goal at its infant stage of development.

The structure of health care delivery system has undergone several changes over the years. The minister of health is the head of the entire organisation. The minister is assisted by vice minister in his/her day to day functions. However, the minister as well as vice minister are political appointees and are changed with the change of the ruling party. The Director General occupies the highest position in the management of the entire ministry. An organogram of the ministry of health is given in Figure 1.

There are 13 districts in the country and primary health care component is managed at the district level and is provided through Community Health Centres (CHC), Health Posts (HP) and mobile clinics. The CHCs are mostly located at sub district level (in some cases at district level). The district health office is responsible for providing all the necessary support in carrying out the primary health care activities in the district. Moreover, district health office is responsible for managing all national health programs. Thus most of the finances for promoting health care are channelled through the district health office. The organisation set up at the district level is given in Figure 2.

The next tier in the health care delivery system of Timor Leste is referral hospitals. At present there are 5 referral hospitals in the country. These hospitals are well equipped to provide the secondary level health care services. These hospitals are mostly located at district administrative headquarters. The districts which do not have a referral hospital, is at least equipped with a CHC with few beds (referred to as CHC level 4). There are total 7 Level 4 CHCs in the country. However, apart from providing the referral services, these hospitals also provide the primary health care for the population at its catchment area. Referral hospitals are managed by their respective managers and the funds for these hospitals are directly provided to them. Thus the district health managers are not responsible for managing the finances for the referral hospitals.

The specialised (highest level) health care in the country is provided by the National Hospital, known as Hospital National Guido Valadares (HNGV). The hospital is a 264 bedded facility located in national capital Dili. The overall responsibility of the hospital has been given to the manager and the funds required for its management is directly provided to the hospital.

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National Health Council

Health Inspector’s Office

National DirectorateAdministration, Logistic &

Procurement

Director General

Health Professional Council

National Directorate of

Human Resources

National Directorate of Hospital Services

National Directorate of Community Health

Service Delivery

District Liaison Office

Dep of AdministrationDep of Logistic and Asset ManagementDep of ProcurementDep of Medical Equip.

Dep for Communicable Disease ControlDep for Non Communicable Disease ControlDep for MCHDep for NutritionDep for Oral HealthDep for Mental HealthDep for Health Education and Promotion Dep for Environmental HealthDep for Pharmaceutical Services

Dep of HR PlanningDep of Health Professional Registration & Development Dep of Staff Management

National Hospital

Public Health Office

Dep for Clinical ServicesDep for Hospital Management SupportDep for Referral Services

District Health Services

Protocol and Mass Media

Legal Office

HMIS & Dieasease Surveillance

Health Policy Office

Minister &Vice Minister

National Laboratory

Institute of Health Science

SAMES

Referral Hospitals

Quality Assurance

National Directorate of

Planning & Finance

Dep of Planning, Monitoring and EvaluationDep of FinanceDep of Partnership Management

Figure 1: ORGANOGRAM – MINISTRY OF HEALTH

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Health Education and PromotionCommunicable Disease ControlNon Communicable Disease ControlMCIPharmaceutical Services

HEAD OF DISTRICT HEALTH SERVICES (L6)

DISTRICT HEALTH COMMITTEE

Programatic Technical Service Administrative Services

AdministrationStaff ManagementLogistic & Asset ManagementHMIS & Diseases Surveillance

SUBDISTRICT HEALTH CENTREDISTRICT HEALTH CENTRE

MOBILE CLINICSHEALTH POSTS

Ambulance Division

HEALTH POSTSMOBILE CLINICS

Figure 2: ORGANOGRAM FOR DISTRICT HEALTH SERVICES

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Apart from these health care institutions, there are other institutions such as Institute of Health Sciences, National Laboratories. These institutions are autonomous institutions and are managed by their respective managers and separate budgets are allocated to them for their operations.

Procurement of drugs and consumables is done by the autonomous body known as SAMES. The logistics and procurement directorate of the ministry takes care of all other procurements including vehicles, medical equipment. They are also responsible for the maintenance and repair activities. The national directorate of human resources is responsible for the matters related to manpower – their training, appointment etc.

1.2. Financial management Financial management involves controlling, conserving, allocating, and investing the organization’s resources, including personnel, equipment, supplies, and the nonmonetary contributions of volunteers and donations. It goes beyond the traditional accounting focus on recording and reporting of financial transactions, to focus on analysis and decision making.Financial management is about analyzing financial performance, identifying ways to use resources efficiently, and finding creative ways to use resources to generate additional resources. Financial management activities include:

In most of the organizations, financial management is thought of as specific responsibility to be carried out by those with special training. While it is true that financial management is a distinct discipline, it is also important to recognize that anyone who is responsible for planning, purchasing, monitoring, or using monetary, human, or other resources is a financial manager to some extent. In fact, managers at all levels must concern themselves with financial matters or they will soon find that they lack the resources to accomplish long-term goals or to maintain day-to-day operations. As a manager, your role is to seek the most efficient uses of the resources you control, in order to carry out activities 8 | P a g e

Matching available resources to the activities planned by the organization;

Monitoring the efficiency of current resource use; Identifying ways to reduce and recover costs; Finding ways to finance new initiatives; Identifying trends in past resource usage, in order to

determine future budget requirements, project cash needs, and forecast financial growth;

Managing and investing current resources to make them profitable;

Developing long-term financial plans to meet future resource requirements;

in a way that supports your organization’s goals and strategic plans. The current document aims at explaining the above aspects that are relevant to planning and financial management for the health sector in Timor Leste.1.3. Background to this manualAs mentioned above the districts are responsible for providing primary health care services. Therefore the District Health System (DHS) plays the key role in managing the aspects related to the delivery health care services. Thus the DHS can be defined as the “decentralised building blocks” of the health system in Timor Leste. Though the boundaries of health districts have been demarcated and District Health Management Teams (DHMTs) are formed at each district – the district health authorities are granted little autonomy in managing the financial resources. Almost all the things (related to finance) such as procurement of drugs, goods and services, equipments and their maintenance are done at the central level. The district and hospital authorities are just provided with few thousands of dollars a month for their day to day operations. However, following problems were observed:

There is no comprehensive and strategic approach to financial management at district as well as hospital level

There is little linkage between the plans made and the budget provided to the district

There is little linkage between the services provided and financial management

There is lack of good organisational processes for managing the finances

The rules and regulations related to managing the finances are poorly understood

Shortage of technical and trained manpower to handle the finances

Financial management is often perceived as a difficult task that specialised people can carry out

1.4. Aims and objectives of the manual

Keeping the above problems in mind the manual aims at:

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Explaining the concept of financial management and different aspects related to it

Regulatory framework and current arrangements at central and district level Explaining the concept District Health Management Cycle – Planning,

Budgeting and the linkage between the two Introducing the concept of comprehensive and strategic approach to financial

management through the introduction of the concept of three year rolling budget

Define the task of health and hospital managers and other related staff in managing their day to day financial needs

Providing necessary guidelines in managing the finances at the district and referral hospital level

To make the concept of financial management “how to do” – within the present regulatory framework of Timor Leste

1.5. Regulatory framework in Timor Leste The revenue, budget and expenditure of the government of Timor Leste operate within certain rules and regulations that guide the financial management at the central as well as the district level. These regulations acts as guidelines, directives and circulars about managing public resources or money, make up the regulatory framework. The most important pieces of regulations are:

1. UNTAET Regulation No.2001/13 on budget and financial management, 20th July 2001 (See UN web site for Timor Leste)

2. The treasury regulations of December 2002 (Ref: Treasury Manual 2002, Ministry of Finance)

The Ministry of Finance and the Treasury play the central role in managing the public finances at central as well as district level. This regulation is applicable to all the ministries that spend the public, bilateral and other foreign funds.

The districts in Timor Leste lack adequate infrastructure to manage the finances. For example, each district in the country do not have a treasury / banks that acts as important financial institutions to bring the treasury and UNTAET regulations into force. Therefore most of the finances in the country are managed at the central level, with little autonomy to the districts. The same applies to health sector also. Though the districts are guided by the above regulations, the day to day financial needs of those institutions are guided by the circulars issued by the ministry of health at the central level (Guideline Nº01/2008/IVGC/MS; Guideline Nº03/2008/IVGC/MS). Annexure – 1 and 2

What these regulation aims at?

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Facilitating the managers to meet their requirements, but hold them accountable

Introduce various aspects related to planning, budgeting, expenditure, assets and on the above giving a broad view of financial management at verious levels

Establishing good system of financial planning and control

Establishing a system of in-year (management throughout the year) management of finances and monitoring

Establishing a system of reporting that are necessary to held the managers accountable for the resources they receive

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Planning and budgetingPlanning involves designing the district health plan and getting a clear picture of the range of inputs (personnel, vehicles and equipment) needed, as well as how these will be combined to achieve priority goals.Design the District Health Plan in the following way:Analyse the current services, resources and health trendsPrioritise and plan the activities that would form the best option to improve the situationQuantify the inputs required to carry out the activitiesCost the amount of money required to pay for these inputsPrepare budget (all activities together)Negotiate a proper district allocationRefine plan and prepare final budget

Implementation

(The process of doing the activity or intervention.)Implementation is about using the resources to have uninterrupted service delivery.

Things to consider: Will the way we organise our services bring about the most health returns ?

Should we improve our support systems to improve delivery?What capacities are lacking?

Are the mechanisms in place to monitor the implementation and the outcomes?

EvaluationEvaluation is about looking back at the complete picture, the good and the not-so- good and being able to account for these. Evaluation lays the foundation for the next planning cycle.

How have we performed?How much did we spend overall?

What has the impact been?Could we have achieved a better result with a different strategy?

Did our services address the basic health needs and future health needs? How efficient were we?

Did the community enjoy equal access for equal need?What were the pitfalls and constraints?

MonitoringMonitoring is about checking progress against the District Health Plan. It is also about keeping a close eye on expenditure, making sure revenue is collected, and watching the quality of care.How much have we completed?Is this in line with our district health plan?Is it taking longer than we thought? Why?Checking of total money spent to date against the budgetIs there anything we need to change in the remainder of the activity?

1.6. The district health management cycle1.7. Procedure of planning in Timor Leste

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When we talk about planning, we mean decentralised planning. We simply go back to the WHO’s concept of District Health Systems (DHS), where the district is considered to be the appropriate unit for preparing health plans. Therefore it is referred to as District Health Plans (DHP). A district health plan (DHP) sets out the goals and strategies that will enable the health district to best meet the health needs of its population. It is based on the challenges identified in an annual report for the previous year, and includes details of the funding allocated to implement the proposed strategies.

The district health plan is an archive of policy decisions and modus operandi for the functions of the district health services vis-a-vis the health programs that are to be followed in the year ahead. Basically it contains the strategies to be followed, the areas of concern, as well as the strategies to improve the delivery of health services in the district. Like any other plan the district health plan states the areas where the health programs and the health service delivery have to be strengthened. The objective of the district health plan is as follows:

To identify the functional areas where the district health system has to improve upon its performance chalked out from previous years achievements and other performance indicators

To chalk out the problem areas where the previous years have shown relatively poor performance in achieving the targets as set and stressing on to improve the performance in terms of equity, efficiency and coverage

To plan better management of the health services delivery in terms of cost efficiency, logistics, manpower planning, quality assurance, etc.

To reduce the burden of diseases in the community and bring better and efficient health services within the reach of all members of the community, particularly the disadvantaged sections

To introduce more and more micro planning and enhance decentralization so that the community based and community specific health services can be ensured; and

To set carefully benchmarked achievable targets for the district in terms of delivery of services and to consider the scope of improvement in the programs continuing in terms of quality and micro planning.

The planning process differs among the countries depending on the political and administrative setup, sources of funds, requirement of the department of planning and finance, treasury requirements. In most of the developing countries the district health plan is a part of the Integrated Development Plan (IDP) of the district. In other words, the plans are prepared for all sectors of the district and DHP is a part of it. The district plan explores the possibilities of intersectoral coordination in delivering various types of services in the entire district. For example, while preparing the plan, the health department consults with other departments like Public Works Department (PWD), Department of Women and Child Welfare (DWCW), Integrated Child Development Services (ICDS), Department for Water Supply and Sanitation etc. in order to develop a comprehensive plan. The budget allocation process also follows the same approach. This approach rules out the possibility of duplication of efforts across the departments.

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In most of the underdeveloped countries each department prepare their own plan without consulting the other departments. However, the approach of planning mostly depends upon the administrative set up at the district level and the coordination among them. As it will be seen later, the districts in Timor Leste do not have well organised administrative set up, thus making it difficult for any comprehensive planning. In the present module we have presented an ideal planning process that could be used for preparing the district health plan for Timor Leste.

1.7.1. Planning processPreparation of Annual Action Plan (AAP) is the first step in the financial management cycle. Furthermore, the AAP acts as the basis of budget preparation. This is the prime requirement of the Ministry of Finance in Timor Leste. Every year the department of finance issues a circular to the ministry of health for preparation of Annual Action Plan (AAP) and submission of the budget. The circulars are usually issued just after the middle of the current year (July / August) for the preparation of AAP and budget for the next financial year.

The budget formulation process is based on the principle steps of policy development, review and prioritisation. The ministry of health along with the other ministries is requested to prepare its budget based on the strategic policy priorities and fiscal envelops1 issued by the government. The budget is reviewed by the Budget Review Committee and decision on the final allocations is made by the council of ministers. The basic process is as follows:

Preparation of plan (activity wise) at CHC, District and National Level and budget formulation

Submission of Annual Action Plan (AAP) and budget Review of budget and AAP by the Budget Review Committee (BRC) Preparation of draft state budget funding by ministry of finance based on BRC

recommendations Approval of the state budget funding by council of ministers Documentation of combined sources budget prepared by ministry of finance Final documentation and presentation to national parliament

It must be noted that the time given for the preparation of AAP and budget is too short to follow a decentralised approach in planning. As a result the planning and budgeting exercise is mostly carried out by the central level. The current practice of district level planning and budgeting is as follows2:

1 The fiscal envelop covers the maximum amount of recurrent funding each ministry of the state may receive in 2009 and is not to be exceeded.

2 During the year 2008 an attempt was made by the ministry of health to prepare the annual action plan much prior to the circular issued by the Ministry of Finance. This attempt, no doubt, is an improvement of the planning process that was adopted during previous years. However, the estimation of budget envelop was done in a wrong fashion (the allocation by the external agencies that are not part of the general state budget was taken as the basis for determining the budget envelop for 2009). As a result the Annual Action Plan as well as the budget was revised at the last moment, when the budget was to be submitted to ministry of finance.

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After the approval of the budget the health care institutions including the DHS are requested to prepare their detailed implementation plan in the format provided to them3

For the preparation of plan the institutions are provided with their budget envelop which is prepared by the ministry of health. The budget envelop is prepared by taking the criteria internally developed by the Ministry of Health. (Discussed in Module – 2)

On the basis of the budget envelop provided to the districts, the districts develop their annual action plan in the format developed and provided by ministry of health

The annual action plan of each district consists of the total expenditure of the district on different items such as , manpower, drugs and consumables, equipment (major and minor) etc. that are necessary for the delivery of health services

The CHCs are also provided with the budget envelop and prepare the detailed implementation plan.

1.7.2. Present system and difficulties No specific guidelines are used by the planning department for the preparation of plan4 by the ministry during past 8 years, though there are evidences of the guidelines being available to the respective departments. There are various reasons – such as supply of guidelines during inappropriate time/format, when the system did not have that much capacity to adopt them. However, in the absence of appropriate documentation of the processes and procedures followed during the preparation of AAP at various levels, it is difficult to comment anything on the appropriateness of the procedures of planning in the past. However, discussion with central planning and finance department coupled with visit to districts and direct interaction with the people from health department and participation in the planning process gives the following impressions:

Though the process of planning and budgeting was highly centralised in the previous years, during the present year (preparation of plan for 2009) the degree of involvement of health functionaries in the planning process was relatively high. This was envisaged from the following facts:

3 It must be noted that the AAP formats for different levels (CHC, Hospitals, District and Central) are prepared by prepared by the department of planning MoH. During the process of planning for the year 2009 it was noted that different districts use different type of formats, thus giving an indication that the formats are not standardized across the health facilities and districts. During the process of preparation of this manual the formats were not standardized and it is expected that the standardized formats would be made available / an attempt will be made to standardize the formats during the process of preparation of this manual / phase of training. 4 During December 2003 a user manual titled “District Health Plan User Guide: A step by step guide to development of the District Health Plan 2004-2005” was produced during December 2003. The document, no doubt, gives several insights to the preparation of decentralised plan. In practice the document was not used in for the preparation of plan for the year2004-05. During 2008 for the first time the department of planning and finance felt the need of such guideline and prepared a document titled “Guidelines and procedure for operational planning”

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During the year 2008, the plan for 2009 was prepared well in advance. The process was initiated during July 2008 and a committee was formed for the same.

The committee took important decisions on the expected budget envelop and allocation to district and sub-districts on the basis of some pre-determined criteria

The health functionaries from district, CHC and hospital level were invited to a 3 day workshop which was conducted at the central level. During the workshop the participants were provided with the information on budget envelop of their respective institutions and the necessary formats (excel sheets) to prepare the plan. Attempts were made to address all the queries by the participants on their budget envelop.

The participants were requested to prepare their plans in the formats provided to them. The attempt was to make the participants oriented about the planning formats.

Due to inadequacy of time the participants were requested to go back to their respective institutions and districts and complete their plan within one week from the day of workshop.

Each institution (13 districts, 5 referral hospitals, 1 national hospital, IHS, National Lab and all the departments of the ministry of health) was requested to participate in another week-long workshop, where the prepared plans were discussed in detail and feedbacks noted down.

Then the institutions were requested to incorporate the comments from the workshop and finalise their plan. The plan such prepared was submitted to the department of planning, MoH.

Drawbacks and difficulties:

Though there is a system of collecting health information (HMIS), the importance of this information is poorly understood by most of the institutions. The institutions did not use this information for the preparation of their own plan. The use of the information was made only during the preparation of budget envelop.

During the trainings the participants were just explained about the templates. Nothing is explained about the plan and its importance, relationship between planning and performance, monitoring and evaluation etc.

Though the attempts were made to make the formats uniform across similar categories of institutions, during the presentation it was observed that different districts used different types of formats. This posed severe difficulty during the consolidation process.

The ministry of health is considered to be one of the best ministries in terms of its budget execution and performance. Unfortunately, the performance indicators are not taken into consideration while preparing the budget on different programs5

5 During the finalization of the plan for 2009, it was suggested to include three more columns (i.e., Objective of each program, Program code, Performance indicators) in the Annual Action Plan of the respective institutions so that the during the coming years the linkage between the performance and budget could be established. This comment was made by Dr. Nelson, Honorable Minister of Health, Timor Leste.

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The district health plans at present are taken as ritual exercises which the districts do just fulfilling their obligation/requirement for the ministry. So the sense of decentralisation is just not realised

As the district health authorities takes the preparation of plan as ritual exercise, their participation in achieving the health goals of the district (i.e., monitoring and supervision) is quite limited

What needs to be done?

Given the present circumstances, it is necessary that a three year rolling plan is prepared by each of the districts. A three year rolling plan of a district is a strategic plan of the district submitted along with the Medium term Expenditure Framework (MTEF6) to the ministry of health. In a three year rolling plan the plan for the current year is the operational plan of the district with a new plan being prepared each year.

The facilitating factors for introducing three years rolling plan:

At present the country has already developed the health sector strategic plan (HSSP) and currently several activities initiated under the HSSP is carried forward by the Aus-Aid-World Bank funded HSSP-SP

The health sector has developed the Medium Term Expenditure Framework (MTEF)

The health sector has its hospital costing framework in the place that would help in planning for the national and referral hospitals

1.8. Development of operational planPlanning, implementation and reporting form a spiral process (Green 1999). A three year district plan is developed and the first year becomes the operational plan. The operational plan is implemented and monitored during the year. An annual report is prepared of the health situation and performance for the year and this is used as the basis for the next three year plan.

Planning should be carried out by DHMT led by health district managers. A district plan is: ∑

i=1

n

Plan of district (i )+ Additionalactivities only related ¿ district health offce¿

The plan prepared at the sub-district level is called the detailed implementation plan. Though the bottom line of service delivery is not the sub-district CHCs, for the purpose of planning the sub-district is being considered as the bottom unit. It is expected that the sub-district level managers would prepare the detailed activity and implementation plan for all the bottom level health care institutions (health post, mobile clinic, etc.) and monitor their activities on a regular basis in order to achieve their targets. The steps in the preparation of District Health Plan

Step 1: Formation District Health Management Team (DHMT) and Sub-District Health Management Team (SDHMT): In order to facilitate the health care delivery and other related activities at the district level, the concept of District Health Management Teams

6 The MTEF is in the process of revision. It will be made available before January 2009.

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(DHMT) is being introduced by the MoH. Though the concept of DHMT is introduced, in actual situation they do not exist in the district. For the purpose of planning it is necessary that the teams are formed in each district and made functional. The composition and the terms of reference (TOR) of the team are given in Annexure 3 and 4.

The role of the DHMT would be guide and supervise the SDHMT and to consolidate the reports and plans prepared by SDHMT. A health sub-district plan will cover one or more health posts (or mobile clinics/any other facility), while a health district plan will cover the entire plan of the health sub districts. The need for joint planning at health district and sub- district levels is vital to build and maintain a well-functioning district health system.

Step 2: Preparation of calendar of events: Proposed time table for preparation of plan for 2010:

What needs to be produced? What time

How Who

1. Conduct sub district and district health expenditure reviews (DHER7) Jan-Dec 2008:

April 2009 DHER technique DHMT and SDHMT and National Level Team (NLT)

2. Preparation of sub-district annual reports for 2008, 2009, Expected Level for 2010

May 2009 Putting the necessary information in tables

DHMT and SDHMT

3. Preparation of district annual reports for 2008, 2009, Expected Level for 2010

June 2009 2 day district workshop

DHMT and SDHMT and NLT

4. Discussion of district Annual reports and develop national mission, vision and key strategic health goals for 2010

June 2009 2 days workshop at national level

DHMT, NLT

5. Preparation of draft budget envelop for national, district and sub-districts for 2010

June 2009 District annual reports Historical budgeting,

NLT

6. Dissemination workshop on budget envelop8 at the national level

July 2009 1 day National Level Workshop

NLT

7. Preparation of plan of district and sub-district plan (Capacity development)

July 2009 2 Days training at the district level

DHMT, NLT

8. Preparation of plan and budget at sub-district and district level

July 2009 DHMT, SDHMT

9. Submission of District Level Plans and budget to National level

July 2009 DHMT

9. Preparation of National Level Plan (draft) July 2009 National Level NLT10. Adjustment of plans as per the budget envelop given by MOH

August 2009

National level workshop

NLT, DHMT, SDHMT

11. Submission of AAP and budget to ministry of finance

September 2009

NLT

7 The District Health Expenditure Review (DHER) is out of the scope of the present manual and covered separately. 8 The budget envelop should not take into consideration the funds and expenditures made through TFET and Non-TFET. It should only take into account the allocation from the GSB (CFET).

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District Annual report – Achievements and performance indicators

Reports from Health postReports from mobile clinic and others

Annual Report of CHC on different performance indicators 3 years CHC health plan (rolling plan)

District operational plan (1 year)

CHC operational plan (1 year)

3 year Strategic Plan for the District (rolling plan)

Five year strategic plan for the country from 5 yr. Plan document

Step 3: Preparation of district and sub-district Annual Report: It is expected that the DHMT would consist of a core group which should include representatives from the health district (represented by NGOs, private practitioners and local representatives). The full committee should have representatives from the District Health Office’s (DHO’s) health finance and health information units, key primary health care (PHC) programmes, as well as support programmes like human resources, pharmacy and transport. The persons in charge of HMIS should be responsible for preparing the Annual Reports, which is a pre-requisite for the planning process.

(a) HMIS and Preparation of Plan

(b) What is district Annual Reports?

An annual rep ort is required to inform stakeholders about the health situation and accounts for the resources used during the year and what has been achieved. It also provides information required for developing district health plans. An annual rep ort looks at issues of quality, equity, cost- effectiveness, efficiency, affordability and sustainability. The preparation of annual reports pre-requisite a good and standard Health Management Information System (HMIS) as explained above.

(c) What level the reports should be prepared?Annual rep orts should be prepared at the health sub-district and district levels. Sub-district reports (CHC level report) should be prepared first and these should serve as the basis for district level reports. The sub district level report should consist of the reports from the health post as well as mobile clinic level that are compiled at each sub-district CHC. Each annual report will form the basis for the three-y ear plan for that level.

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Five year strategic plan for the country from 5

yr. Plan document

3 year Strategic Plan for the District

Annual Report of CHC on different performance

indicators

Five year strategic plan for the country from 5

yr. Plan document

(d) What a report should contain? (Example – Preparing the plan for 2010)

1. Background – demographic, geographic, socio-economic data 2. Health status – epidemiology and key health problems.3. Service platform – numbers and distribution of facilities and personnel.4. Expenditure – by sub-programme and standard item.5. Service delivery – analysis by sub-programme.6. Challenges – as a basis for planning.7. Short-term actions – problems which will be addressed quickly

The reports should compare performance in three different ways: Over time Among geographical areas/facilities Against pre determined targets

Step 4: Preparation of plan documentStructure and content of plan document

The district health plan should be structured according to the following elements in the sequence shown below:

A situation analysis A strategic direction An operational plan

The situation analysis:Question Information needed What it tells How it helpsAre the services addressing the current and future health needs?9

Demographic and socio-economic profile of the various communities in the district.

It shows which communities would benefit the most from the resources and services.

To allocate resources and render services

Gaps in health status and main health problems amongst the communities.

Disease profiles and trends in the communities.

Gaps in achieving previous targets

It shows which health programmes require strengthening

It shows future demands on health resources.

It also shows which services to monitor closely

To strengthen service programmes.

To re-allocate resources towards needs.

Are the current services efficient, equitable and sustainable?

How the communities access and use the services (e.g. utilisation figures).

Information on how efficient service delivery happens.

(See later modules for detail.)

It shows where access needs to be improved, as well as in what areas the distribution and use of resources need to change.

It highlights areas where the quality of care could be inferior.

To improve the allocation and management of resources.

To focus investigation for the improvement of delivery

Information that shows whether the service is sustainable, for example, expenditure

It shows whether the present trend in spending, and therefore service

To re-plan the way services are organised and delivered

9 Tables 1-7 are the formats that could be used for the organization of information in the plan document.

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patterns and spending versus budget.

(See later modules for detail.)

provision, is sustainable

To re-allocate resources to ensure sustainable services

How suitable are the organisational arrangements of service provision?

Define obstacles to uninterrupted service delivery.

Capacities required improving service delivery.

Strengths and weaknesses in organisational structures and support systems such as information or drug distribution systems.

It shows what capacities are needed, as well as what changes are necessary to ensure management structures and systems will bring about a well-run service.

It also shows where the district / central office should provide support to unlock delivery.

To design capacity building and support programmes.

To improve support systems.

To strengthen management

Strategic Direction: This is made up of a vision, mission and a strategy and gives a focus for what will happen for the next few years. It flows from the situation analysis and is designed by top and middle managers, but all staff should be involved if they are to feel that they are part of it.

The vision and mission: The vision is like an ideal or a dream and draws on the vision of the department/ministry. The mission describes the core business, its reason for existence, and gives an idea of how the district aims to realise the vision.

The strategy: This gives the broad idea of what will be done to achieve the mission.

Example

Vision: Satisfied community with quality health care

Mission: To be a well functioning health district with adequate resources that would enable rendering the high quality of health care through friendly and professional health staff and well maintained facilities

Strategies:

1. Establish quality improvement strategies in each institution 2. Treat patients at appropriate level of care3. Strengthen management and management support system

Operational plan: As defined above, the operational plan is the first year of the three year rolling plan and in the present circumstances is most suitable for Timor Leste. The Operational Plan outlines in detail what will happen for the current year and gives a broad idea of what will happen for the next two years. It uses the situation analysis to prioritise and appraise which actions would be most suitable to bring about improvement in the

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Problem: Low TB cure rate of 50%

Intermediate output: 1. Increase in the proportion of TB patients that participate in the DOTS Program from 80 to 90% 2. TB drugs are never out of stock in the clinic

Problem: Increased TB cure rate to 75%

current situation. Briefly the operational plan outlines the following:

i. The Service Plan (captured as service goals and a plan of how services are to be organised).

ii. Inputs, such as nurses and vehicles, required to fulfil that plan and how these inputs will be distributed.

iii. Monitoring and evaluation of targets to check progress and achievement.

(i) The Service Plan

To develop service goals, the management team would need to do the following: Make sure that the goals reflect the steps needed to work towards the mission.

Each goal should have a specific focus and an outcome or impact that can be measured.

Design the steps (objectives and activities) required to achieve these goals. Assessing these helps the management team to monitor progress. (Discussed in Module -3 of the manual)

Ensure services are organised to guarantee optimal delivery at best quality and best price.

(ii) Determining the input:

Determine the range of inputs, such as personnel and vehicles required to implement the service plan. These inputs represent costs. These inputs are then combined in a budget. (Discussed in Module-2)

(iii) Preparing to monitor and evaluate

The District Health Management Team (DHMT) needs to identify what measures will give information about progress in service delivery and in the use of resources. Targets are necessary for services, for expenditure, as well as for revenue.

- Setting service targets.

Each service goal represents an output. It is important to determine measures that will tell the DHMT staff and communities whether they are on track towards the output as well as how they will know whether they have reached it. The goals must be defined clearly and the data identified that will help the team to assess progress and achievement. It usually helps to design intermediate steps towards the goal, for example:

Setting targets for expenditure and revenue.

The district needs to stay within budget that is allocated. Furthermore, from the situation

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analysis of previous efficiencies, new targets for example, the average cost per visit and average drug cost per visit could be determined and monitored. (Discussed detail in Module 5)

1.9. Planning formatsAs mentioned above, the situation analysis would constitute the first part of the plan document. Tables given in Annexure 5 could be used for that purpose. The operational plan in Timor Leste should be prepared by using the excel sheets (formats) developed by department of planning, Ministry of Health. Presently the formats are not standardised and it is hoped that these should be standardised during the preparation of this manual. (Insert the modified excel sheet for AAP for districts and detailed implementation plan for CHCS) – Annexure 6

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Summary: Module 1 aimed at-

Giving a brief overview of health care delivery system in Timor Leste Outlining the regulatory framework for planning and financing District health management cycle Explaining the MTEF and how it can be applied in a three year rolling plan Different steps in planning and the persons responsible A tentative calendar for preparation of district health plan Inputs necessary in the preparation of detailed implementation plan at district and

sub-district level Existing forms and formats for planning Definition of important health indicators (used for the purpose of planning

Module -2

Financial Management – Budgeting

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Planning and budgeting (Module-1 and 2)

Resource Allocation(Module -2 and 3)

Evaluation and reporting(Module – 5)

In-year Management: Operating, Monitoring and Safeguarding – (Modules 4 and 5)

About this module:

2.1. BudgetingFor the purpose of understanding the importance of budgeting in financial management process, we start this module with the following simple flow chart: Financial Management Cycle:

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After going through this module the reader should be able to answer the following:

What is the relationship between health care planning and budgeting and how both of them form as the important steps in financial management?

What are various types of health care budgeting and their usefulness in the context of Timor Leste?

What are the steps involved in the preparation of health care budget in general and health care budgeting in Timor Leste in Particular?

What are the different items included in health care budget in Timor Leste? What is Chart of Accounts and how it is linked to the line items included in the

budget? How to allocate the approved budget among the different services (i.e., priority

setting)?

What each of the elements in the cycle include?

Process What it involves?1. Planning and budgeting Assessing the current resource position, linking

resources to service plans and determining a budget Drawing up a budget which will guide how money

is spent in order to achieve the goals set Setting targets for revenue and expenditure Setting targets for efficiency and equity

2. Resource allocation Allocating resources across district services 3. In-Year management: - Operating, monitoring and safeguarding

Ensuring that funds are spent and revenue collected according to the financial plan and according to the norms and standards set by the regulatory authorities

Making sure that there is good internal control measures

4. Evaluation and reporting Linking expenditure to service output and analysing with respect to equity and efficiency

Drawing up an annual report Identifying the key strategic issues for the next plan

In Module 1, much of the emphasis was laid on preparation of service plans. After the preparation of service plan, we need arrange for the resources in order to provide the necessary services – i.e., we need to prepare our financial plan. In other words we have to prepare our budget and allocate the resources among the planned services.

2.2. What is budgeting?Definition: Budgeting could simply be defined as the formulation of plans for a given time period in numerical terms. In other words, budgets are statements of anticipated results (plans) expressed in terms of financial terms (e.g., revenue and expense and capital budgets). Financial budgets have sometimes been said to represent the “dollarizing” of plans.

For the purpose of present document, a budget will be defined as the systematic documentation of one or more carefully documented plans for all individual activities, programs, or sections. Furthermore, for the purpose of clarity we also defined certain terms which were used but not clearly defined in Module-1.

There are two types of planning models that are commonly used in health care budgeting:

1. Strategic planning 2. Tactical planning

(1) Strategic planning: Strategic planning is usually conducted at the highest level of an organisation’s hierarchy (Ministry of health) at the time the organisation’s mission and goals are decided on and the strategies required to achieve these goals are identified. It is defined as the process of appraising the present operating environment, anticipating the future environment, establishing a specific set of goals and plotting a series of short term

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Present position 1: First year 2: Second year 3: Desired position

tactical plans, preferably in one year increments, which systematically route the organisation towards its intended long-range-position.

Using a three year horizon, the strategic planning model is illustrated above. The process:

Appraises the organisations present position Determines the organisations desired position Describes the strategy by means of three tactical plans the organisation is required

to implement in order to achieve the desired position

(2) Tactical planning: Tactical planning involves an integrated series of one year tactical plans or operating budgets that are designed to assist the organisation in achieving its strategic goals in a timely manner. Thus the tactical or budgetary planning process requires:

Establishing the organisation’s mission, goals and objectives Identifying the budget’s assumptions, variable standard rates and costs, acceptable

performance standards and other relevant guidelines Developing capital expenditure plan Projecting a volume forecast Constructing a revenue and expense budget Forecasting the cash flow resulting from the functions just mentioned

2.3. Pre-requisites of budgeting The budget as a plan for the future should ideally be based on an analysis of historical data, experience, or knowledge, which must be utilised separately or in combination to predict future operations. The following are the pre-requisites of budgeting:

1. An organisational structure, with responsibility centres identified and individual responsibility assigned (See- Figure 1 in Module 1)

2. An accounting Chart of Accounts that parallels the organisations chart and responsibility centres or departments

3. A data collection system that is designed efficiently and, if possible, automatically (computerised) collect related statistical and financial data on a concurrent and historical basis

4. A management reporting system that parallels the organisations structure, the chart of accounts and the budget

5. The formation of a budget committee and identifying someone as the budget director.

6. Preparation of budget calendar with individual responsibilities and 7. Preparation of a budget manual that should include all the points 1-6 described just

now

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2.4. Types of budgets1. The fixed or static budget: This type of budget is developed and based on volume

of activity. The methodology for the preparation of fixed budgeting do not require the separation of fixed and variable expenses – thus makes it difficult to compare the actual performance with the budgeted performance when the volume of activity differs.

2. The target budget: The target budget is developed in the same way as fixed budget – i.e., it is generated by using fixed volume of activity. However the target budget requires expenses to be separated into fixed and variable categories. Such categorisation of expenses helps in (a) developing standard revenue rates per production units and (b) standard expense rates per production units

3. The variable budget: This type of budget uses the standard variable rates generated in the target budget. By multiplying these rates either by actual or budgeted daily, monthly or annual volume the total revenue and expenses for the accounting period can be generated. The segmented fixed salary and non-salary expenses developed in the budget in the targeted budget remains constant, regardless of any changes in volume of activity

4. The appropriation budget: This type of budget is more commonly used by the governments and municipalities. The amount of expenditure is usually fixed by some external body which appropriates funds for a specific department or division within the organisation. The weakness of this budgeting is that the managers of the cost centres are encouraged to spend the total allotted budget. Unless they spend it, the next year’s budget is reduced accordingly.

5. Performance based budget: Under this budgeting system the performance of an organisation is used as the basis for budget allocation. This type of budgeting takes the financial / physical performance of an institution (i.e., the performance indicators are compared according to the budget allocated for them) and the budget is allocated accordingly.

6. Program based budget: The allocation of the budget is made as per the programs. The programs are first prioritised on the basis of their contribution to the welfare of the society and budgets allocated. In most of the instances the health budget is program based.

7. Activity based budget: This type of budgeting is more micro in nature. In the health sector under each program various activities are carried out. For example under Tuberculosis Control Program, apart from case detection and treatment, various activities such as community awareness through IEC etc. are also carried out. Each and every activity carried out under this program is taken into consideration when preparing the budget for TB control program.

For health care budgeting the most commonly adopted technique is program and activity based budgeting. If good information on performance are available then performance based budgeting is also used. Thus:

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A health care budget reflects the service priorities. It acts as a framework for spending money and assessing financial performance.

2.5. Budgetary process in Timor LesteAs mentioned above, the preparation of the service plan is the first step in financial management. The service plan (called Detailed Implementation Plan for CHCs and District Action Plan for the entire district) is prepared through the excel templates. The templates used for the purpose of planning need to be filled with (a) service plan and the (b) resource plan to provide the services. The service and resource plan is prepared at the facility level and consolidated by the department of planning, MoH.

Steps in financial (resource) planning:

Collect the budget envelop for your institution from the central level. The budget envelop is calculated on the basis of MTEF and previous year’s budget allocation

Try to understand the rationale behind the allocated amount and clarify with the concerned authorities if there is any doubt

Prioritise the services / Programs as per the need of the population Trace out the resources required for each of the activities under each program Specify the physical quantity of inputs required for each of the activities under

each program (List of all current programs is annexed) Make sure that the cost of the resources required for providing the services equals

to the budget envelop

For the purpose of understanding the budget envelop for the year 2009 is given in Annexure – 2.1. The format for service and resource plan is annexed in Module-1.

2.5.1. Preparation of budget The budgeting exercise is carried out by the finance department, ministry of health. As just explained the resource (financial) planning is made by taking the programs and activities into consideration. On the other hand, the budget exercise is carried out as per the guidelines given by the ministry of finance (Budget circular). The budget is prepared for each of the divisions (looks like institutions) as defined by the Chart of Accounts. Presently there are 33 divisions and the budget for each of the divisions is prepared separately. The description of each division within the ministry and their respective codes is given in Annexure 2.2.

2.5.2. The items that make up a budgetThe total budget is divided into following 5 appropriation categories and the items under each appropriation are explained below:

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Please note that the capital expenses – minor and major, drugs etc. are centrally procured. So the planning format should include the

information on the quantity of recurrent inputs only

Salaries and wages – Cost of all the staff requirements such as salaries, overtime, allowance etc.

Goods and services – Expenses on travel, training and workshops, utilities, fuel, maintenance of vehicle and equipments, vehicle rental, office stationary and supplies, operational materials and supplies, operational expenses etc.

Minor capital – Security and communication equipments, EDP equipments, generators, water equipments, office equipment and other office equipment etc.

Capital and development- Acquisition of building, infrastructure assets, injection of capital, major capital equipment etc.

Transfer payments – Personal benefit payments, public grants etc.

The categories of expenditure under each appropriation are called as Items. The items are further divided into different sub categories called as line itemsDetails of each appropriation, their code; each item under the appropriations and their code; the line items under each item and their code is given in Annexure 2.3

2.5.3. The budget process Phase I: Preparation of budget prior to the budget circular

Step 1: Formation of Budget Review Committee and finalisation of budget envelop- Prior to the issue of budget envelop by the ministry of finance, a budget review committee is formed by the MoH. Unless and otherwise specified, the Director of Planning and Finance would head the committee. At the initial stage the committee calculates the budget envelop and circulate it across all the division.

Step 2: Preparation of budget Manual: A guideline/manual containing all the necessary steps in budgeting is prepared by the department of finance. (At present there is no guideline for budgeting. The general guidelines mentioned in budget circular are used for budgeting purpose. It is assumed that such guideline will be made available by the end of this year)

Step 3: Each division is then given the necessary excel workbooks along with the guideline (At present finance department prepares the budget for each division. It is hoped that the budget exercise will be decentralised during the next year and the necessary training for the preparation of the budget will be imparted)

Step 4: Submission of the prepared budget to department of finance of MoH for consolidation.

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Phase I of the budget exercise is aimed at making the divisions familiar with the preparation of budget. Moreover this practice would help putting

the three year rolling plan in place as suggested in Module -1

Points to remember

The excel workbook that is presently used for the preparation of budget takes into account all the items (Each work book has the number of worksheets equal to the number of items)Each item is further classified in to Line Items in the worksheets. Each worksheet contains the unit cost of these line items (pre defined by finance department). Therefore the user of the excel workbook has to mention the unit of line items only. The inbuilt formulae in the worksheet calculate the budget for each item and the figure appears in the main sheet.

Phase II: Revision of the budget after the budget circular

Step 5: The head of the budget committee is required to revise the budget in accordance with the instructions contained in the budget circular: For this purpose the budget committee re-calculate the inter division budget envelops and send them to respective divisions.Step 6: The divisions revise their budget as per the new budget envelop and submit the corrected version to the finance department, ministry of health. The finance department reconsolidate the budget and submit it to the ministry of finance for consideration.

Phase III: Review of the budget by ministry of finance

Step 7: Review of budget by the Ministry of Finance: Budget officers of the Ministry of Finance, in consultation with the head of the budget committee of the ministry of health, confirm that the cost of expenditures for which the appropriations have been requested (budget envelop), and other estimates, have been determined accurately and the budget submission meets the budget circular

Step 8: Managing the disagreements: In case of any disagreement the budget officers of the ministry of finance and the head of the budget committee shall seek to resolve disagreements and develop mutually acceptable budget submissions. The central fiscal authority set out the budget regulations, appropriation regulations and government finances regulations and modifies them time to time depending on the requirement and national priority.

Step 8: The budget committee may request the minister of health to provide further submissions or explanations during consideration of the proposed budget.

Step 9: After consideration of any submissions or explanations the budget committee shall prepare an agreed budget, proposed appropriations regulation, and proposed government finances regulation for consideration of the Cabinet.

Step 10: The head of the ministry of finance present the agreed budget, proposed appropriations regulation, and proposed government finances regulation to the National Council before the year preceding the fiscal year to which the Regulation applies.

Step 11: The budget thus prepared and approved is allocated to different divisions (institutions) and an account of the budgets allocated to different divisions is maintained by the treasury under free balance system.

2.6. Linkage between planning and budgetingAs mentioned above, the service plan in Timor Leste also include resource plan. The resource plan includes the units of various categories of input (Line items) that are necessary for carrying out the proposed activities under each program in the service plan. These input units (units of line items) are used for calculating the cost of each item in the budget workbook. However, following points need to be noted:

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The programs in the Chart of Accounts and their code do not match with the health programs specified in service plan. As a consequence it is difficult to trace the actual expenditure on each of the health programs and compare this with their performances. This make it difficult for a program budgeting for the health sectorGiven this problem it is suggested to match the programs in Chart of Accounts with the programs mentioned in service plan. This will need a detailed discussion with the ministry of finance to revise the items and programs in Chart of Accounts.In case this is not possible, it is suggested to establish an internal mechanism of matching the programs within the ministry along with the budget allocated for them. This will need serious effort and help of some computer software experts to do this job within the ministry itself.

2.7. Allocating the budgetOnce the budget is approved for each district, the next task is budget allocation. In this context following points must be noted:

The districts are given little or no autonomy in managing the budget allocated to them.The major and minor capitals are purchased centrally by the procurement department. The district authorities should keep an eye and ensure that the major and minor capitals are procured as per their needs (planning)The salaries are directly provided by the ministry of finance and credited to the accounts maintained in Banking and Payments Authority (Central Bank of Timor Leste)The drugs are procured by SAMES. It also should be ensured by the district authorities that they are provided with all the necessary drugs as requested by them.Till date there is no central workshop for the maintenance of equipment. Therefore the district health authorities as well as hospitals have little control over themThe districts are provided with the little amount of money (........ how many dollars?) each month for their recurrent expenses and this is fixed by the ministry of health.The districts should ensure that the finances (monies) allocated to them in each month are managed properly and records of expenses on each item is maintained properly (this should be done as per the guidelines issued by MoH.

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Conclusion: The budgetary procedure in the district needs to be looked in s

systematic manner and the capacity needs to be developed to orient the DHS and Hospital authorities in the preparation of budget

In view of the large chunk of money being managed at the central level, the authorities should keep an eye on each and every item of expenditure at central level

The DHS as well as Hospitals need to maintain their records properly - financial and non-financial

Annexure 2.1: Budget Envelop for 2009

IV GOVERNO CONSTITUCIONAL

MINISTÉRIO DA SAÚDE

Gabinete do Ministro da Saúde

CIRCULAR Nº 07 /2008/IVGC/MS

Regarding planning and budget preparation at the Ministry of Health for the financial year 2009

Considering the need to prepare the annual plan and budget for the financial year of 2009, that could follow participatory principles and equitable distribution of financial resources across different structures within the Ministry of Health (MoH);

Having in mind the importance of integrating and harmonizing planning processes and budget preparation within MoH;

Pursuant to the policies and principles defined by the IV Constitutional Government in relation to the General State Budget (GSB) for the 2009 financial year,

I instruct all structures within MoH to prepare the annual plan and budget for 2009 financial year, in line with the following orientations:

I. PROCESS

1. Through the Ministerial Executive Order Nº31/2008/IVGC/MS, I appointed a Committee for Planning and Budget Review within MoH, which will revise annual plans and budgets prepared by all structures within MoH, by evaluating and approving it, as well as presenting it to the competent bodies within MoH for final approval, before submitting it to the Ministry of Finance, in line with the time schedule in annex 1;

2. All structures within MoH should first prepare a Detailed Implementation Plan (DIP), following the model/format used for DIPs during 2008. In principle DIPs for 2009 will not have many variations compared to DIPs 2008, with inclusion of any priority activity for 2009.

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3. The annual plan and budget should be in line with the budget envelope, principles and policies as defined in the following points.

II. BUDGET DISTRIBUTION WITHIN MoH 1. Even though the budget envelope for MoH is not yet definitive, in order to facilitate the

process of planning and budgeting within MoH, the estimation of MoH budget envelope is based on the following:a) In the 2009 financial year, MoH will get a minimum of 6.5%10 from the estimated

GSB amount of US$526.7 million. This means that MoH will get more or less US$33,585,500.

b) According to budget categories, the above mentioned amount will be allocated within MoH as follows (annex 2, table 1):i. 30% for Salaries and Wages; ii. 50% for Goods and Services; iii. 8% for Minor Capital; iv. 10% for Capital Development;v. 2% for Transferences.

c) The categories of Salaries and Wages (30%), and Goods and Services (50%)11 totaling the amount of 80% or US$26,868,400, will be distributed in the following way (annex 2,table 2):i. 60% or US$16,121,040, to District Health Services (DHS) and Central

Services;ii. 35 % or US$9,403,940, to Hospitals within the National Health Services;iii. 5 % or US$1,343,420 to the Institute of Health Sciences and the National

Health Laboratory.

III. BUDGET ENVELOPE FOR EACH STRUCTURE WITHIN MOH 1. DHSs will get 66% from the amount of US$%16,121,040, or the amount of

US$10,639,886.40. This will be distributed to each DHS in line with equity criteria as follows (see annex 3):a) 70% or US$7,447,920.48 is allocated on the basis of the amount of

population of each district;b) 30 % or US$3,191,965.92 is allocated on the basis of each DHS

performance, and the perceived geographical barrier for their population to access primary care.

10 In 2008 financial year, MoH had a budget of, including the rectified budget US$30 M. In the previous financial years, MoH had the average of 10% to 12% of GSB. Due the continuous growth in the GSB, and because the IV Constitutional Government gives also priority to other sectors, the realistic estimation for MoH for 2009 would be more or less 6,5%.11 These two categories are classified as Recurrent Budget.

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i. Performance12 gets 60% or US$1,915,179.55, which will be distributed to each DHS following their performance13 index (OPD index);

ii. Geographical barrier14 will get 40% or US$1,276,786.37, which will be distributed according to the geographical barrier15 of each district.

2. Central Services will get 34% from US$16,121,040, or the amount of US$5,481,153.60. This is proportionally distributed as shown in annex 4.

3. Hospitals within the National Health Services will get 35% of the overall recurrent budget or the amount of US$9,403, 940. The allocation to each hospital can be seen in annex 516.

4. The Institute of Health Sciences will get 4% of the recurrent budget, or the amount of US$1,056,000.

5. The National Health Laboratory will get 1% of the recurrent budget, or the amount of US$264,000.

IV. PRINCIPLES AND POLICIES TO BE FOLLOWED IN THE PLANNING AND BUDGET PREPARATION

1. From the budget envelope every structure within MoH should allocate only a maximum of 30% to Salaries and Wages, and the remaining to Goods and Services.

2. When preparing the annual plan and budget, all structures should involve Heads of Departments, Head of Offices, Heads of CHCs, and those responsible for divisions within each structure.

3. All priority programs or routine activities such as BSP and SISCa should continue to follow priority and criteria as defined for 2008. All DHSs, CHCs

12 Performance indicator used here is the OPD per capita of each DHS for 2007. 13 To reach OPD index, divide OPD visit per capita by total national OPD visit per capita, then multiply with 100. Example: Aileu DHS had an OPD visit per capita in 2007 of 3.2. This divided by total national of 24 times 100 equals 13.33%. To know the amount allocated to Aileu DHS on the basis of performance, multiply 13.33% with US$1,915,179.55, and the result will be US$255,357.27.14 Geographical barrier means the population of any given district has difficulties to access primary care due to many factors, including the distance between their homes to the nearest Health Post or CHC, and does not have other alternatives from the private sector. 15 To facilitate the process to determine the index of geographical barrier, and having in mind the abovementioned definition, firstly we consider all districts as having a flat rate index of 1. Secondly we consider Dili, Baucau and Ermera as districts with relatively no barrier, because even though in some areas the population has difficulty to access primary care, these 3 districts have a significant presence of private sector which can help reduce the barrier. The index value of these 3 districts is distributed to other districts with priority given to those with smaller amount of budget allocation of the basis of population and performance.16 Note from the translator: It was decided to follow the recommendations of the Hospital Costing Study undertaking during 2007, to allocate budget to hospitals. Population of catchment area, case mix, utilization and efficiency were the criteria utilized.

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and Hospitals should allocate their budget to these technical programs following each one’s annual plan.

4. On the other hand, DHSs, CHCs and Hospitals should also include in their annual plan and budget, new initiatives (defined as a new activity to be introduced or an activity supposedly implemented, but not yet done until now), which has relevance to health problems in Timor-Leste and have positive impact on population’s health, such as:

a) Implementing Basic Emergency Obstetric Care (BEOC) at remote CHCs;

b) Introducing health care program to the aged;c) Introducing health promotion on cardiovascular disease;d) Implementing integrated vector control activities through the

establishment of DHS teams;e) Hospitals to provide outreach services to CHCs/sub-districts under their

catchment area.

5. All structures involved in direct service delivery to the population such as CHCs and Hospitals should include in their Goods and Services budget funds for drugs, consumables and reagents needed for their health care activities. When there is no other reliable base for calculating unit costs, US$3/capita/year can be used as the benchmark.

6. The budget envelope allocated to each structure as defined in the annexes, can only be used to fund Minor Capital and Development Capital when all routine activities and new initiatives are sufficiently funded.

7. Needs related to the budget category of Minor Capital and Development Capital will have a centralized allocation. This means that, when needed, each structure within MoH, can submit a list of needs, and the Committee for Planning and Budget Review will decide on the allocation of available funds.

8. DHSs should allocate a maximum of 30% of their budget envelope to the activities of the DHS office, and the remaining should be distributed to the CHCs under their responsibility. This allocation should be based on the number of population of each sub-district (corresponding to 70% of the amount of funds allocated to CHCs), and the geographical barrier of each sub-district17 (corresponding to 30% of the amount of funds allocated to CHCs). The allocation of 70% of DHS budget envelope to CHCs can be seen at annex 6.

9. The allocation of Goods and Services budget within departments or offices in the Central Services should give priority to activities in order to perform their functions as defined in the Ministerial Decree Nº01/2008, dated 27 February.

17 Note from the translator: this is an index established on the basis of relative geographic barrier for population at the sub-district, compared to others living in other sub-district of the same district.

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When there is excess in funds, or whenever a technical program is considered of highest importance but no other source of funding is identified, then funds can be allocated to the said technical program under their responsibility18.

10. Each structure can also prepare a list of needs that cannot be covered by their fiscal envelope for 2009, to be submitted to the Committee for Planning and Budget Review, during the process of planning and budget review19.

V. DEBATE AND REVISION AT MoH COMMITTEE FOR PLANNING AND BUDGET REVIEW

1. Following the defined time schedule, each structure within MoH should make a submission of its annual plan and budget to the MoH Committee for Planning and Budget Revision;

2. During the submission sessions, teams from each structure should also involve Heads of Departments, Heads of Offices and Heads of CHCs, in order for them to follow the process and answer any question from the Committee for Planning and Budget Review.

3. The debate on the submission should systematically include the following:i. Each structure will make a presentation of no more than 15 minutes; ii. Questions and answers no more than 30 minutes;iii. Each structure will make the necessary corrections during the period

of no more than one day and submit the final version to the MoH Committee for Planning and Budget Review.

4. The MoH Committee for Planning and Budget Review will make decisions about corrections needed or to approve the submission from each structure, on the basis of the following criteria:

i. The annual plan and budget submitted by each structure are in line with the current Circular;

ii. The annual plan and budget submitted by each structure are in line with the overall policies of MoH as well as with the regulations in place;

Dili, 23 July 2008,signed

DR Nelson Martins, MD, MHM, PhDMinister for Health

18 Note from the translator: this is based on the assumption that funds for the implementation of all technical programs are being budgeted under the structures of care provision, such as CHCs and Hospitals or under the 30% determined for DHS office.19 Note from the translator: If assessed as of high priority for 2009, the Committee for Planning and Budget Review can either seek additional funds from MoH or, include it for multilateral or bilateral funding from development partners.

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Annexure – 2.2Chart of Accounts Ministry of Health

(1) Ministry code: 15, (2) Ministry: Ministry of Health; (3) Department code: 1501; (4) Secretariat: Ministry of Health

(5)Division code

(6)Division

(7) Program

code

(8) Programs

150101 Minister of health 261 Minister of health 150102 Vice minister of health 324 Vice minister of health 150103 Central Services 325 Central Services150104 National Laboratories 468 National Laboratories 150105 Dili National Hospital (HNGV) 458 Dili National Hospital (HNGV)150106 Referral Hospital Bacau 460 Referral Hospital Bacau 150107 Referral Hospital Maliana 462 Referral Hospital Maliana 150108 Referral Hospital Maubisse 463 Referral Hospital Maubisse 150109 Referral Hospital Oecusse 464 Referral Hospital Oecusse 150110 Referral Hospital Suai 465 Referral Hospital Suai 150111 Aileu District Health Services 469 Aileu District Health Services150112 Ainaro District Health Services 471 Ainaro District Health Services150113 Bacau District Health Services 473 Bacau District Health Services150114 Bobonaro District Health Services 475 Bobonaro District Health Services150115 Covalima District Health Services 477 Covalima District Health Services150116 Dili District Health Services 479 Dili District Health Services150117 Ermera District Health Services 481 Ermera District Health Services150118 Lautem District Health Services 483 Lautem District Health Services150119 Liquicia District Health Services 485 Liquicia District Health Services150120 Manatuto District Health Services 487 Manatuto District Health Services150121 Manufahi District Health Services 489 Manufahi District Health Services150122 Institute of Health Sciences 467 Institute of Health Sciences150123 Oecusse District Health Services 493 Oecusse District Health Services150124 Viqueque District Health Services 491 Viqueque District Health Services

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SAMESHealth Inspectors Office Health Inspectors OfficeDirector General Director GeneralNational Directorate of Hospital Services

National Directorate of Hospital Services

National Directorate of Community Health Services

National Directorate of Community Health Services

National Directorate Administration, logistics and procurement

National Directorate Administration, logistics and procurement

National Directorate Human Resources

National Directorate Human Resources

National Directorate Planning and Finance

National Directorate Planning and Finance

Contd...

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(1) Ministry code: 15, (2) Ministry: Ministry of Health; (3) Department code: 1501;(4) Secretariat: Ministry of Health

(9)Sub-Program

code (10)

Sub-program

(11) Activity

code

(12) Activities

26101 Minister of health 2610101 Minister of health 32401 Vice minister of health 3240101 Vice minister of health 32501 Central Services 3250101 Central Services

3250102Roll out of maternity and lab facilities on health clinics

3250103Design and supervision of health projects

46801 National Laboratories 4680101 National Laboratories 4680102 Constn. Of Lab for testing, Pharmacy

45801 Dili National Hospital (HNGV) 4580101 Dili National Hospital (HNGV)

4580102Finalisation for new forensic pathology dept - HNGV

46001 Referral Hospital Bacau 4600101 Referral Hospital Bacau 4600102 Constn. Of doctors quarters Bacau

46201 Referral Hospital Maliana 4620101 Referral Hospital Maliana 4620102 Completion of Maliana Ref. Hospital4620103 Housing for one doctor - Maliana

46301 Referral Hospital Maubisse 4630101 Referral Hospital Maubisse 4630102 Nursing residence - Maubisse4630103 Doctors accommodation quarters

46401 Referral Hospital Oecusse 4640101 Referral Hospital Oecusse 4640102 Constn. Of Ref. Hosp. Premier wall

46501 Referral Hospital Suai 4650101 Referral Hospital Suai 4650102 Constn. Of doctors and nurse Reside.

46901 Aileu District Health Services 4690101 Aileu District Health Services4690102 Aileu Dist. Hlth. Center – Officers

47101 Ainaro District Health Services 4710101 Ainaro District Health Services4710102 Consn. Of HP – Liurai4710103 Ainaro Health Center - Officers

47301 Bacau District Health Services 4730101 Bacau District Health Services4730102 Constn. Of HP- Ossowaque4730103 Constn. Of HP- Ossowala4730104 Constn. Of HP- Ossohuna

47501 Bobonaro District Health Services 4750101 Bobonaro District Health Services4750102 Constn. Of HP- Kailako4750103 Rehabilitate lab.-Lalotoi

47701 Covalima District Health Services 4770101 Covalima District Health Services4770102 Constn. Of HP- Gala4770103 Constn. Of HP- Fatululic

47901 Dili District Health Services 4790101 Dili District Health Services4790102 Extending Health Center - Becora

48101 Ermera District Health Services 4810101 Ermera District Health Services4810102 Constn. Of HP- Leubasa

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4810103 Rehabilitate the HP- Hatolia 48301 Lautem District Health Services 4830101 Lautem District Health Services

4830102 Construction of HP – Lacavo4830103 SDS Rehabilitation – Lautem

48501 Liquicia District Health Services 4850101 Liquicia District Health Services48701 Manatuto District Health Services 4870101 Manatuto District Health Services

4870102 Rehabilitate HP-Iehau4870103 Rehabilitate HP – Manufuhi Kiik

48901 Manufahi District Health Services 4890101 Manufahi District Health Services46701 Institute of Health Sciences 4670101 Institute of Health Sciences49301 Oecusse District Health Services 4930101 Oecusse District Health Services

4930102 Construction of HP- Lakufoan4930103 Rehabilitation of HP-Sacato

49101 Viqueque District Health Services 4910101 Viqueque District Health Services4910102 Construction HP- Uatulari4910103 Construction HP-Viqueque

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SAMESHealth Inspectors Office Health Inspectors OfficeDirector General Director GeneralNational Directorate of Hospital Services

National Directorate of Hospital Services

National Directorate of Community Health Services

National Directorate of Community Health Services

National Directorate Administration, logistics and procurement

National Directorate Administration, logistics and procurement

National Directorate Human Resources

National Directorate Human Resources

National Directorate Planning and Finance

National Directorate Planning and Finance

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Annexure 2.3: CLASSIFICATION OF BUDGET BY LINE ITEMSAppropriation category Item Line itemCode Appropriation

descriptionCode Item description Code Line Item description

01 Salaries and wages 600 Salary 6000 Salary – permanent employees 6001 Salary Temporary employees – Local6002 Salary Temporary employees – Overseas6003 Consultant fees – overseas 6004 Consultant fees –Local

610 Overtime / Allowance 6100 Over time

02 Goods and services 620 Local travel 6200 Local travel6201 Advance – local travel

625 Overseas travel 6251 Overseas travel6252 Living allowance/Installation – Missions6253 Advance – Overseas travel

630 Training and workshops 6300 Staff training – local6301 Staff training – Overseas6302 Seminars and workshops6303 Advance – Training and workshops

640 Utilities 6400 Water 6401 Electricity6402 Telephone, Fax and internet /pulse6403 Other utilities

645 Rental of property 6450 Rental of property

650 Vehicle operation fuel 6500 Vehicle operation – Fuel

651 Vehicle maintenance 6510 Vehicle maintenance

652 Vehicle rental insurance and services 6520 Insurance, rental and services

660 Office stationary and supplies 6600 Office stationary and supplies

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Appropriation category Item Line itemCode Appropriation

descriptionCode Item description Code Line Item description

670 Operational materials and supplies 6700 Agricultural supplies 6701 Defence supplies 6702 Medical supplies 6703 Rations 6704 School supplies 6705 Uniforms 6799 Other supplies

680 Fuel for generators 6800 Fuel for generator

690 Maintenance of equipment and buildings

6900 Repair and Maintenance of Furniture

6901 Repair and Maintenance communication equipment6902 Repair and Maintenance Building6903 Repair and Maintenance Electrical 6904 Repair and Maintenance other infrastructure assets6905 Repair and Maintenance roads and bridges 6910 Motor spare parts 6911 Generator spare parts6912 Other spare parts 6913 Advance – Maintenance of equipment and building6999 Miscellaneous maintenance services

700 Operational / other expenses 7000 Official entertainment7001 Bank charges 7002 Representation allowance 7003 Freight and transport7004 Rental office equipment 7005 Postage7006 Subscriptions 7007 Contributions to Suco7008 TFET counterpart contributions 7009 Retroactive finance7010 Main. Gen. Sets.

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Appropriation category Item Line itemCode Appropriation

descriptionCode Item description Code Line Item description

7011 Other contributions 7012 Other operational expenses 7073 Advance – Official Entertainment

705 Professional services 7105 External audit7106 Medical services 7109 Security services 7111 Professional services 7112 Technical support 7113 Other support assistance

706 Translation services 7110 Translation services

710 Other miscellaneous services 7100 Advertisement and publicity 7101 Catering services 7102 Cleaning and sanitation services7103 EDP services / Information 7104 Educational services 7107 Photocopy services 7108 Printing services 7199 Other miscellaneous services

715 Payments of memberships 7150 Payment of memberships

720 Current transfers 7200 Current transfer to public enterprises 7201 Current transfer to financial institutions 7202 Contribution to international bodies7203 Current transfer to NGOs and individuals 7250 Current transfer to personal benefit payments 7260 Current transfer to public grants

730 Interest payment and borrowing related 7300 Interest expense 7301 Borrowing related charges

740 Petty cash 7400 Petty cash

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Appropriation category Item Line itemCode Appropriation

descriptionCode Item description Code Line Item description

760 General embassy advance (G&S) 7600 G&S for general embassy advancement

03 Minor capital 810 Purchase of vehicle 8100 Motorcycles 8101 Vehicles 8102 Boats and vessels

820 EDP equipment 8200 EDP Equipment

830 Security equipment 8300 Security equipment

840 Communication equipment 8400 Communication equipment

850 Other miscellaneous equipment 8500 Household equipment8501 Refrigerators 8502 Construction equipments and plants 8503 Air conditioning8504 Electrical equipment 8505 Workshop equipment 8506 Medical equipment 8599 Other equipment

860 Furniture and fittings 8600 Furniture

870 Office equipment 8700 Other office equipment

880 Generators 8800 Generators

890 Water equipments 8900 Water equipment

950 General Embassy advance

04 Capital and development 800 Acquisition of buildings 8000 Buildings

900 Infrastructural assets 9000 Infrastructural assets

910 Injection of capital 9100 Injection of capital

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Appropriation category Item Line itemCode Appropriation

descriptionCode Item description Code Line Item description

920 Major capital equipment 9200 Major capital equipment

???? Capital development ??? Personal benefit payments ???????????

Public grants

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Module -4

Budget, Expenditure and Financial Management

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About this module:

4.1. Execution of budget - Regulatory framework As explained in Module 2, the preparation of health sector budget in health sector in Timor Leste follows a division based approach. In other words, each division in the ministry, 30 divisions are required to prepare their own budgets. During 2007 there were 24 divisions within the ministry (Annexure 2.2). Currently the ‘Central Services’ has been divided into 7 divisions (directorates). Thus the ‘Central Services’ in the Annexure is replaced by these divisions, thus making a total of 30 divisions within the ministry. A close look at the chart of accounts given in the annexure gives the impression that the divisions within the ministry are also the programs (the name of the programs are same as the name of the divisions – only difference between them is that the codes are different). Therefore the terms ‘program’ and ‘division’ are being used alternatively depending upon their appropriateness.

As the sum of the budgets for all these 30 institutions adds up to the total budget, it is not clear whether SAMES is being treated as an autonomous organisation within the ministry of health. Moreover the budget for drugs and medical supplies are included within the budget of each of the health care institutions i.e., DHS, Referral and HNGV and national lab. Discussion with the people in SAMES gives a clear indication that neither they have understood their own budget allocation process nor they are clear about the entire procedure of managing their finances. If SAMES is to be treated as an autonomous

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After going through this module the reader should be able to answer the following:

What is the procedure of execution of budget and how it is done for different items (as per the budget book)?

What is free-balance system and how the expenditure on different items is recorded under this system?

What is the meaning of financial autonomy? How much autonomy do the districts have on financial matters?

How do the districts obtain the impressed fund – procedure and format? Is there any guideline for the district health managers that help them for

managing their day to day expenses? Is there any mechanism of monitoring the budgets at different levels? What are

they? How to allocate the approved budget among the different services (i.e., priority

setting)?

1 Budget execution and cash management

2Accounting, payments and payroll division

3Debts, grants, asset management division

4Internal Audit division

Financial and planning analysis unitCash management unitNational budget unitAgencies financial officers branch

Treasury

Accounting operations unitCentralised payments and revenues unit

Debts and grants management unitAsset management unit/registerIT systems and development

Routine Audit UnitSpecial Audit Unit

organisation, in the absence of any financial guidelines and detailed information about their budget, it is really difficult for them to understand entire financial mechanism20.

4.1.1. Budget ExecutionAfter the approval of the budget, the next step in the financial management is its execution. This is done by the treasury and regulated by its procedures and formalities as laid down from time to time. A brief outline of the structure of the treasury and the functions of each unit/division is presented below:

Figure 3.1: Structure of the treasury

20 For the year 2009 the budget for Drugs and consumables has been included within the budget of 13 DHS, 5 referral hospitals, HNGV and National Lab. For all the hospitals the allocation criteria is $2.25 per person for the entire population covered under the respective population. Similarly it is also fixed at the same rate i.e., $2.25 per person for the entire population covered under each district. For national Lab, $3.00 is being allocated for each unit for a total of 80,000 units.

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In order to execute the budget for the fiscal year (January- December) and to ensure that the commitments made by the ministries are within the appropriated amount communicated to them, payments, as authorised by treasury are being made by Banking and Payments Authority (BPA).

Treasury and its functions: The treasury is being established under statue (Regulations on Budget and Financial Management) and is under operation since 1st July 2000. The treasury is headed by the Director and is responsible for following:

Monitoring the receipts (revenues) and payments of Democratic Republic of Timor Leste (RDTL) To ensure that all public revenues are credited in to the Consolidated Fund and payments are debited from the consolidated fund so that the treasury is adhered to: An annual budget that sets out expected revenues of the government of RDTL

and proposed appropriations for the fiscal year An annual appropriation law that provides appropriations from the consolidated

fund to the agencies in the fiscal yearAuthorisation by way of an ‘Expenditure Authorisation Notice’ for a ministry to spend an amount that has been appropriated to that ministryMonitoring actual expenditure against the budget of the ministriesIssuing necessary financial and administrative instructions in order to establish a proper accountability in the financial management of the public funds in Timor LesteProducing regular reports on revenues and expenditures

4.1.1a. Budget execution and cash management:

As could be seen from the Figure 3.1, the first and most important function of Treasury is budget execution and management of cash. In order to carry out the activities, this division is supported by three units and one branch.

The financial planning and analysis unit is responsible for:

Preparing three months forecast of revenues, expenditures and cash flow within the overall fiscal context as approved in GSB

Prepare an update of estimate of revenue and expenditures on a monthly basis Help the treasurer to control and manage the expenditure within the available

revenues

The cash management unit is responsible for maintaining accounting records within the government. The unit works in close coordination with accounts and payments division

The national budget unit is responsible for:

Ensuring the implementation of the budget as per the appropriation On receiving Commitment and Payment Voucher (CPV) check the budget item

codes, budget allocation and authorise the commitment Ensure that the commitments are within the amount allocated to each ministry Coordinating with the regional treasury officers21

21 For facilitating the financial transactions at the district level, treasuries are being established. Each district has one treasury located at district administrative headquarters and managed by District Finance Officers/ Regional Treasury Officers.

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Based on the information provided by accounts and payments division, prepare execution report

Maintaining a Master Expenditure Charge Book (Annexure 3.1) or may be generated from free balance information system

The agency financial officers are mostly responsible for capacity building, advising, supervising and liaising with the Finance officers posted in different ministries.

4.1.1b. Accounting, payments and payroll division

The accounting operations unit is responsible for:

Designing and setting up and maintaining treasury ledger system and other books of accounts

Submission of CPVs to the director of treasury and other signatories for approval

Working out day to day closing balance of CFET and its reconciliation with BPA and designed bank

Reviewing the treasury instructions and procedures and updating it on a regular basis

The centralised payments and revenue unit is responsible for:

Designing and maintaining the accounting books and supervise the central payments and revenue functions including 13 District Finance Officers (DFOs) in order to discharge the duties efficiently in timely manner

Keep a daily register of vouchers approved for payment as well as cheques and payment orders issued against all payment vouchers

Inform the concern ministry that the payment to the payees is available for collection either by cheque from treasury or for direct payment or bank transfer through BPA

Coordinating with the authorised revenue collectors for deposit of the collected revenues in the CEFT and recording the same in the accounting books of treasury

Manage all the district payments through the supervision of district financial officers and ensuring that detailed accounts of pretty cash are submitted by them in time

Supervise the record keeping of all the DFOs

4.1.1c. Debts, grants, asset management and system division

The debts and grants management unit is responsible for:

Preparing and submitting details of all the projects funded by multi-lateral and bi-lateral donors and maintaining all the documents relating to negotiations and agreements

Preparing periodic reports based on the reports received from financial officers on physical and financial progress of the project/program funded by the donors

Coordinating with Accounting Operations Unit of the treasury for the accounting of expenditure of the bilateral and multi lateral fund projects

Participating in the successful establishment of Project Management Units (PMUs) and coordinate the recruitment of their financial officers

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The asset management unit is responsible for:

Maintaining a system of public asset register of government assets Preparing the detailed procedures for efficient functioning of Asset Registry

System (ARS) and its review and modifications from time to time Coordinating with all the agencies regarding the assets held by them and obtaining

a list of assets from them at the end of each year Reconciling the details of assets with all the agencies and sorting out the

differences, if any Maintaining the records of financial transactions associated with the

corporatisation and privatisation of government assets

The IT system and development unit is responsible for:

Designing and setting up of the computerised system for the needs of the treasury Providing expertise for treasury needs in software and hardware Coordinating and controlling entire computerised operations of the treasury Updating the Chart of Accounts (COA) and maintain its configuration in the

computerised financial management system of the treasury Serving as the focal point for the Free-Balance system administration in the

treasury Providing necessary training to treasury staff on computer operations and software

as needed

4.1.1d. Internal-audit division

As mentioned, the internal audit division of the treasury consists of two units i.e., routine audit and specific audit units. These units are responsible for:

Analysing the accounting procedures prescribed for treasury and the agencies in order to ensure that they are correct, adequate and free from defects

Ensuring that the Financial Administration Instructions (FAI) and treasury procedures are followed

Scrutinising and check payments and accounting work of the divisions /units under the ministry of finance

Ensuring that all the revenues assessed and received by the revenue earning ministries and credited to consolidated fund

Carrying out any special reviews as required by treasurer or the minister of finance Providing adequate cooperation to the external independent auditors by making

available copies of their detailed audit program and reports

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4.2. Budget and Free Balance System4.3. How much the institutions can spend – Financial Autonomy4.4. Concept of petty cash / imprest fund4.5. Guidelines for spending the fund at district level and below4.6. Reporting and feedback mechanism (monthly/quarterly)4.7. Budget monitoring

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Annexure – 3.1EXPENDITURE CHARGE BOOK

Date Particulars CPV/EAN Ref

Expenditure Authorisatio

n US$

Commitment Actual Expenditure

Current Cumulative Current Cumulative Commitment

Actual

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Annexure – 3.2COMMITMENT AND PAYMENTS VOUCHER (CPV)

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1.5.1. UNTAET Regulation The UNTAET regulation on budget and financial management outlines the set of exhaustive procedures and organisational arrangements that are helpful for receiving and spending of the public money in an effective and efficient manner. Below we mention few points related to preparation of budget and its allocation. The spending of money and other regulations aspects related to financial management is Annexed (Annexure -1). The regulation puts the treasury and the ministry of planning and finance as the centre of each and every financial activity. It outlines the role of various agencies (Ministries) in carrying out the activities related to budget (preparation and submission) and the persons responsible for it. As per the regulation:

The budget thus prepared is subject to review by the Ministry of Planning and Finance.

To be continued

Definitions:

Agency: Agency is an organizational unit (i.e., a ministry) established under a Regulation that defines:

a) the Minister responsible for the Agency;b) the regulations to be administered by the Agency; andc) the major functions and tasks of the Agency;

Appropriation: “Appropriation” means the identification in an appropriations Regulation of the maximum amount that may be made available for expenditure for a specified purpose of an Agency by means of an expenditure authorization notice;Appropriation regulation: “Appropriations regulation” means the law that contains appropriations for a fiscal year;

Budget committee: “Budget Committee” means a committee to be chaired by the Head of the Central Fiscal Agency and comprised of the heads of at least four members of cabinet to be nominated by the Deputy Transitional Administrator (Governance and Public Administration);

“Chief Financial Officer” means the person responsible for the preparation and implementation of the annual budget of an Agency;

“Consolidated Fund of East Timor” means the consolidated group of accounts and deposits of the Transitional Administration, as provided in Regulation 2000/1;

“designated services authority” means a Program of an Agency that operates as a separate authority and that is listed in Schedule 1 to this Regulation;

“earmarked receipts” means any receipts:

a) granted to the Transitional Authority subject to conditions on how they may be spent;

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b) collected pursuant to taxing or other Regulations that stipulate conditions on how the receipts may be spent; or

c) derived by a designated services authority from the sale of assets or provision of goods and services for which the authority was established;

“expenditure authorization notice” means the notification to an Agency that it is authorized to make expenditures of that part of the appropriation specified in the notice;

“fiscal year” means the period from July 1 of a year to June 30 of the following year;

“government finances Regulation” means a regulation including the items described in Section19;

“Head of the Central Fiscal Authority” means a person appointed to be the Head of the Central Fiscal Authority under Regulation No. 2000/1 or so designated by the Transitional Administrator;

“Head of an Agency” means a person appointed to be the Head of an Agency under Regulation or so designated by the Transitional Administrator by way of notification;

“local governments” means any regional or local government established by regulation in East Timor;

“National Council (NC)” means a council established under Regulation 2000/24 on the establishment of the National Council;

“official bank account” means an account described in Section 7;

“Program” means a major division of the activities of an Agency relating to service delivery to a specific group, outcome, or objective including the complete activities of an Agency where they constitute a single set of activities;

“public grant” means an amount provided to an individual, organization or legal person for an objective consistent with the objective of the Agency providing the grant;

“public money” has the meaning given in Section 4;

“Treasurer” means a person designated by the Head of the Central Fiscal Authority as the Head of the Treasury; and

“Treasury” means the Treasury under the Central Fiscal Authority, which assumes the functions described in Section 3.

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1.5.2. Treasury ProceduresMajor sources of Funding:

The funding for health sector in East Timor comes from five sources:

1. Consolidated fund of East Timor)

(A) Consolidated fund of East Timor (CEFT/GSB): The CEFT/GSB is the central account of the government structured to reflect the amount and sources of revenue and operating and capital budgets. The major sources of revenue are: (a) Government Taxes, (b) Timor Sea revenues, and (c) direct budget support from the donor countries. The direct support from the donor countries is provided through a financial mechanism, called Continued Support Program (CSP) coordinated by the World Bank.

(B) Internally generated revenues: At present health sector does not have any substantial revenue that is generated internally. Some fees are introduced for VIP rooms and non Timor Leste nationals. This is quite negligible amounting just $130,000.

(C) Trust Fund for East Timor (TFET): The TFET channels the grants for economic reconstruction and development activities in Timor-Leste that are prepared and supervised by the World Bank and the Asian Development Bank (ADB). The World Bank is the trustee. The ADB administers TFET projects in the sectors of roads, ports, water utilities, telecommunications, power and microfinance, with the World Bank responsible for TFET projects in the sectors of health, education, agriculture, private sector development and economic capacity building. All TFET projects are implemented by government departments through project management units (PMU’s). TFET receives funding from Australia, the European Commission, Finland, Ireland, Italy, Japan, New Zealand, Norway, the United Kingdom and the World Bank. It receives no funds from Timorese sources.

(D) External Funding (Non-TFET): Bilateral and multilateral funds are provided by donor governments or international financial institutions for specific projects defined under a grant agreement. The project is usually managed by the respective donor. The Ministry of Planning and Financing has made considerable efforts to track this expenditure and support each Ministry when developing Sector Investment Programmes.

(E) Private Financing: The level of private financing is difficult to estimate as most of the expenditure by the private agencies (NGOs) are funded by the donors. Moreover, the largest NGO café Timor raises funds directly from its members.

Management of State General Budget (GSB) is carried out by the Ministry of Planning and Finance established under the UNTAET Regulation No.2001/13. The government of Democratic Republic of Timor Leste (RDTL) have established a Consolidated Fund of Timor-Leste (CFET). Budget and Financial Management Regulation and Appropriation Regulations for the fiscal year are developed and approved.

In order to execute the budget for the fiscal year and ensure that the commitments are made by the agencies are within the appropriated amount communicated to them, payments, as authorised by treasury, are being made by Banking and Payments authority.

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The treasurer approves the names of Heads of Agencies, Authorising Officers and Certifying Officers. The treasury also issues the Expenditure Authorisation Notice in respect of ‘Salaries and Wages’ and ‘Goods and Services” for the fiscal year to all the agencies. In some cases the expenditure authorisation notices for ‘Capital Expenditure’ are also being issued.

The treasury has issued ‘Financial Administration Instructions’ to all the agencies and concerned offices. The treasury has also opened required account books to execute the budget in accordance with ‘Budget and Financial Management Regulation and Appropriation Regulation’. Account books are maintained by the treasury on a computerised accounting system (called FreeBalance system).

What is Free Balance System?

Rules and regulations of treasury for managing the finances

It is all about good management and performing well. Usually following rules are applied so far as the management of treasury funds concerned:

Let managers manage, but hold them accountable. Introduce a broad view of financial management including the management of revenue,

expenditure, assets and liabilities. Focus on outputs that relate to policy priorities. Establish good systems for financial control.

Insert (Rules a summary of rules and regulations of treasury – as summarised from treasury manual)

The decentralisation is a pre requisite for the efficient and equitable distribution of health services, the concept has not been operational due to the inherent problems in the country- lack of proper administrative structure, infrastructure and other facilities at the district level. ised this concept has either been to the success of the health system in Tat the decentralised level is of

1.3. Financial Management in Timor Leste

As mentioned above, planning is the first stage in the financial management cycle. It is therefore necessary that the concept is well understood before proceeding further. The section is divided into two sub sections. The first subsection describes the process of planning in health sector in general. The second sub section deals with the current process of planning in Timor Leste and the associated problems and the possible solutions that could be incorporated in the planning process.

Planning: -

1.3. The planning process – Regulatory framework

Several types of strategic plans are required under government legislation. For the health sector preparation of a five year strategic plan is in progress (???) The present practice of

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the planning division of the ministry of health is guided by the instructions of the department of planning and finance. In each year the ministry of planning and finance issues necessary instruction to the ministry of health to prepare their plan as well as the budget. The department of planning and finance in the ministry prepare their own plan and the budget. However, the budget is prepared without taking into consideration of what activities are planned for. Thus there is a mismatch between the planned activities and the budget. The budget is submitted to the ministry of planning and finance, which is discussed in the budget review committee by the council of ministers. On the basis of available/predicted revenues, the ministry is requested to revise its budget and the final budget is approved. The present guideline takes all those points into consideration and suggests corrective measures to development the existing planning and budgeting process.

This issue also provides a supplemental GuideBefore we talk about the financial management and associated problems, it is necessary that a few lines on planning within the health sector are mentioned. It is just 8 years that the country has got independence. There have been several conflicts and violence during the post independence period and it was during 2003-04 when attempts were made to plan for the development of the country. Needless to add, the planning during the initial stages were just trial and error exercises without proper understanding of the priority sectors. As a result, there have been fluctuations in the allocation of resources across the sectors, with health sector getting around 10-12 per cent of the General State Budget (GSB). Within the health sector the budgeting and the consequent planning was mostly historical. Till date it is not clear whether the planning should follow the budgeting or vice versa. There was a gradual development of the planning processes.

(Include recent impr Expenditure tracking system in current financial management of MOH

The district Health System (DHS)

All health care providers, whether private or public, would like to get the most out of their investments. The health care providers can be divided into different categories by including some element of ‘private’ in the public health care delivery system and some element of ‘public’ within private health care providers. For understanding the concept of financial management and keep the topic relatively simple, we have divided the providers into two categories i.e., private and public.

Getting most out of their investments would simply mean minimising the cost of outputs (e.g., inpatient days, length of stay, laboratory tests, outpatient contact, immunisation etc.) with the given resources – ultimately referring to the concept of economic and allocative efficiency. Another way of expressing the concept would be ‘technical efficiency’, which mean ‘production of maximum outputs with the given physical inputs and technology’. However, these efficiency concepts are not applicable to health sector in strict sense as health care comes under the category of ‘public goods’. Without going deep into the

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complexities of efficiency issues, we would keep the topic simple in order to have a better understanding.

As just discussed the aim of the health care providers is to ‘get most out of their investments’. The simple question here is what are the investments that the health care providers make? The health care providers invest / spend on three major categories of inputs:

Human resources – doctors, nurses, paramedics, technicians, supportive staff etc.

Physical resources – fixed assets and consumables (health care facilities and health care technology includes, building, equipment and furniture etc.)

Other resources and supplies - drugs and pharmaceutical and other consumables that are necessary for day to day patient care and other administrative requirements

Investment on these requires financial resources (to put simply ‘money’) and the management of the resources, which is defined as financial management, occupies the central place in any type of service delivery system. Therefore, the management of these resources is the platform on which the delivery of health care rests and forms as the basis of all health interventions. Thus, the concept of financial management is defined as “the management of human, physical and other resources and supplies that helps in delivering the health services in the most effective and efficient manner”. The financial management is a complete cycle that consists of four phases: (a) Planning and budgeting (b) Resources allocation (c) In-year management: operating, monitoring and safe guarding (d) Evaluation and reporting. The detail of each of these phases of financial management forms the basic contents of this manual.

The present manual aims at providing necessary guidelines for managing the health care finances in the Democratic Republic of Timor Leste (RDTL). It is therefore necessary to have a clear understanding of the current health care delivery system of the country. Each phases of financial management is described thereafter.

1.1.1. Health Sector in Timor Leste

The present fund flow system involves the following steps:a. After the approval of budget and program from the Parliament, Ministry of

Planning and Finance (MOPF) issues authorisation letter to MOH.b. MOH issues authorisation letter to the respective cost centres (National Hospital,

Referral Hospitals and District Health Office and Projects) based on the respective programs. DHO receives the carbon copy of the authorisation letter at the same time.

c. Based on the request of the cost centres, DFO of every DA provides approval to DHO of the requests and releases the funds to the District Health Office (DHO) according to the respective annual program approved by Parliament.

d. District health office approves the cost centres to spend the budget allocation...

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Besides the CEFT, the Finance Division prepares the capital, drug and medicine and other vertical program budget estimates on the basis of the agreed proposals of donors and bilateral and multilateral agencies. This is funded by TEFT.

Financial management system:

The existing practice is that the District Health Office receives funds direct from the District Administrator and the District Health Office submits the expenditure report of program expenditure direct to the Treasury instead of the Ministry of Health. The District Health Office provides a summary of this expenditure report to the Ministry of Health, but it lacks detail. This does not solve the problem of reporting the expenditure data. The summary report sent to the MoH does not report all of the program expenditure by line items which is usually sent to the Finance Division of the Ministry of Health. In any case, this is not done systematically and regularly. As a result, the Ministry of Health Finance Division does not have available any type of expenditure data broken down by facility and by cost centres. Hence it does not know how much money has spent in providing essential health care service packages in the districts i.e. expenditure on out patient consultation, immunisation program, family planning, malaria, tuberculosis, leprosy, HIV/AIDS, etc, or on basic and refresher training to health care providers, communication programs or even expenditure at hospital level on in-patents and out-patients. At present there is no system providing expenditure by program by line items for each district.

The finance department in the MOH has been supported for a number of years and is now functioning well. The department has good basic accountancy processes in place. However, a number of issues remain. These are: improving the medium term expenditure planning and analysis at the central level, consolidating financial flows, and improving budgeting, expenditure analysis and accountancy at the district level. Two years ago, the budgetary structure was re-organised to distinguish budgets by district. For the first time, district managers became budget holders. Although this budget only covers limited items, (salaries and some other items remain centrally budgeted), this was a major step forward. The districts have been supported by the central level to develop budgets for 2006/7. The central level provided training, a price list and guidance on the methods to be used. However, as this process has only been running for one year, further capacity development at the district level is still very much required.

Without knowing the actual expenditure of each program by district, it is not possible to estimate the next year’s allocative budget for each district. This means that it is difficult to improve the technical efficiency, effectiveness of the provision of health care services to the rural people.

The District Administrator has the authority to spent up to a limit of US$ 1,000 without requiring approval from the central office. This system is based on an DRTL expenditure manual. There is a lack of understanding about disbursement of petty cash to the District Health Managers. This limitation may reduce access to health services.One of the key issues is that budgets are not linked to performance. At present budgets are made, based on past years’ expenditure patterns with some additional expenditure for

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minor capital items. The link between plans to improve the performance of facilities and budgetary allocation is weak. There is little understanding of the cost implications of performance improvements in services. District and hospital managers have little knowledge of performance based budgeting concepts and processes, and financial management is conducted primarily by district level and hospital based accountants.

This weakness in understanding also applies to expenditure monitoring. Although districts and hospitals now have a workable expenditure reporting system, currently, there is little analysis of expenditures. There is also limited information on which to base the analysis. As district managers are only responsible for a small proportion of the district budget, they do not have sufficient consolidated financial information on which to conduct an expenditure analysis. In addition, with districts, the budgetary structure is not sufficiently developed to get a clear picture of the costs of different facilities or programme areas. As stated above, district managers also lack knowledge of the concepts and processes necessary to conduct this type of analysis.

Challenges to Health Care System:

Key challenges to the Timor Leste health system are:

1. Finding the means to increase overall (public and private) resources of health care.2. Ensuring essential services (ie services which produce the greatest reduction in

health burden) and the poorest people, receive the greatest share of public subsidies.

3. Improving the efficiency and acceptability of publicly provided services.4. Improving the value of high quality, at reasonable cost, publicly and privately

provided services.

Strengths in the current financial management system:

The centrally operated Free Balance Budget System is a major strength in the Financial Management of the Health Sector. However, the line items usually covered by a free balance system are inadequate, from a health expenditure point of view, for analysing health expenditure to provide the required data to the health decision makers to continually reform the health sector and improve health service delivery to the rural populations. MOH, Finance Division has just recently started to maintain an account chart in three districts. According to the chart, the District Health Office should maintain the day to day cash ledger. In the remaining districts, hospitals and health posts and community health centres there is still no requirement to maintain the cash register.

Weakness in current financial management system of Ministry of Health

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To date, there is no practice of monitoring the health expenditure reporting system in MOH by program, by line of item by facility, by cost centres, and by disease and reporting by the District Health Manager (DHM) to the central Finance Division. The District Health Manager sends data directly to the Ministry of Planning and Finance, under the Free Balance Budget System. The District Health Manager provides a copy to the Ministry of Health, but this does not cover the whole expenditure of the health service delivery program.

No formal reporting procedures linked with annual budget into performance have been developed

Reporting expenditure budget against actual expenditure for each program is not being performed

Reporting on hospital expenditure is not done. There is no coordination between Ministry of Planning and Finance and MoH giving

access to information under Free balance. Lack of utilisation of expenditure coding by district, by cost centre, by facility and by

disease. There is a lack of understanding of the authority given to District Health Managers to

use petty cash in the health service delivery program. Salary, stationery, office supplies expenditure, allowances, utilities are not allocated to

each line item of each program. Lack of reconciliation of fuel receipts and allocation to correct programs in Free

balance Time delays in procurement of goods and actioning of cash payment vouchers (CPV). At present there is no system to maintain the day to day cash register in the Fixed

Health Post, Community Health Centre, District Health Office and Hospital Level, although this varies across districts. This creates a problem in providing a balance sheet and profit and loss account for the internal auditors

Current gap in the financial management system in Timor-Leste

There is some imbalance in the system in the MoH. The allocated budget is not sufficiently linked with programmes in AAP format. Most of the targets are not quantified. The quarterly reporting format is not in the measurable format of the performance indicators. If the annual and quarterly targets are not sufficiently linked, quantitatively with the allocative and expenditure budget for each vertical as well as CEFT programs, it is extremely difficult to assess performance by districts as well as other data templates. Hence the AAP format should be modified.

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Ministry

Program: Hospitals, districts and Central Directorates

Line Item (Nature of Expense)

Districts (thirteen districts and National

Current MOH structure – Free Balance

The structure below is currently utilised by MOH for preparation of CPV's; this structure will not change. However for internal purposes and for the pilot program the new proposed structure as detailed in the right hand column will be put in place.

`

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ACTIVITY210

0 Maternal Health (Incorporating)  Family Planning  Safe Motherhood  Reproductive Health  Monitoring & Evaluation   

2200 Child Health (Incorporating)  IMCI  Nutrition  EPI  Monitoring & Evaluation   

2300 Communicable Disease Control (Incorporating)  Malaria and Dengue  Maintain/strengthen National TB Programme  Filariasis  Leprosy  Implement HIV/AIDS prevent activities  Monitoring & Evaluation   

2400 Non-Communicable Disease Control (Incorporating)  Implement Mental Health Program  Implement Dental Health Program  Implement Eye Care Program  Develop & implement disaster management program  Maintain Ambulance Services  Monitoring & Evaluation   

2500 Environmental Health (Incorporating)  Develop capacity and plan in Environmental health   Monitoring & Evaluation   

2600 Health Promotion (Incorporating)  School Health Promoter  Family Health Promoter  Support integrated health promotion activities  Monitoring & Evaluation   

2700 Strengthen District Health Management System & Capacity Building (Incorporating)

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  Develop/apply admin.procedures  Provide guidance & supervision of service delivery  Monitoring & Evaluation   

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MINISTRY OF HEALTH - CHART OF ACCOUNTS   

LINE ITEMSCODE DETAIL

  INCOME5000 Grant 5100 Donations5200 Fees & Charges5300 Interest revenue

  EXPENDITURE  Salary & Wages

6000 Salary - Permanent Employees6001 Salary - Temprary Employees (Local)6002 Salary - Temporary Employees (Overseas)6100 Overtime

  Goods & Services6003 Consultant Fees - Overseas6004 Consultant Fees - Local620 Travel & Subsistence Allowance

6200 Local travel6201 Overseas travel6202 Living Expenses-Missions630 Training & Workshops

6300 Staff training -local6301 Staff training - overseas6302 Seminars & workshops640 Utilities & Rental

6400 Water6401 Electricity6402 Telephone, Fax and Internet6403 Other Utilities6404 Rental of property650 Motor Vehicle Maintenance

6500 Vehicle Operation Fuel6501 Vehicle Maintenance6502 Vehicle/Motorcycle Insurance6503 Rental of vehicles6600 Office Stationery and Supplies670 Operational Materials & Supplies

6700 Agricultural Supplies6701 Defence Supplies6702 Medical supplies6703 Rations6704 School Supplies6705 Uniforms6799 Other supplies6800 Fuel for generator

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690 Repairs & Maintenance6900 R&M Furniture6901 R&M Communication Equipment6902 R&M Building6903 R&M Electircal6904 R&M Other Infrastructural Assets6905 R&M Roads & Bridges6910 Motor Spare Parts6911 Generator Spare Parts6912 Other Spare Parts6999 Misc. Maintenance services700 Other Operational Expenses

7000 Official entertainment7001 Bank charges7002 Representation allowance7003 Freight and transport7004 Rental office equip7005 Postage7006 Subscriptions7007 Contributions for Community Service710 Other Miscellaneous Services

7100 Advertisement & Publicity7101 Catering Services7102 Cleaning & Sanitation Services7103 EDP Services7104 Educational Services7105 External audit7106 Medical Services7107 Photocopy Services7108 Printing Services7109 Security Services7110 Translation Services7111 Professional Servcies (International Medical Specialists)7112 Technical Support7113 Other Support Assistance7199 Other Services7300 Interest expense7301 Borrowing related Charges

  Capital Expenditure8000 Buildings8100 Motorcycles8101 Vehicles8102 Boats/vessels8200 EDP Equipment8300 Security Equipment8400 Communication Equipment8500 Household Equipment

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8501 Refrigerators8502 Construction Equipment and Plants8503 Airconditioning8504 Electrical Equipment8505 Workshop Equipment8506 Medical Equipment8599 Other Equipment8600 Furniture8700 Other Office Equipment8800 Generators8900 Water Equipment9000 Civil Works

Codes for health post and CHCCode Facility

100 Dili District 300 Aileu District101 Dili - Centro Clinic 301 Aileu Kota102 Becora 302 Alieu Dental Clinic103 Comoro CHC 303 Kotalau/Laulara104 Metinaro 304 Nameleso/Lequidoe105 Bairo Pite 305 Acumao/Remexio106 Atauro 306 Aileu Kota District Services107 Comoro Dental 307 Fatubosa108 Dili District Health Services 308 Maurussa109 Hera 309 Seloi Kraik110 Darlau 310 Fatisi111 Manleu 311 Madabeno112 Balibar 312 Bereleu113 Berau 313 Faturasa114 Anartutu 314 Fahisoi115 Bikeli 315 Maumeta116 Dili Hospital 316 Tulatakeu

200 Bacau District 400 Ainaro District201 Baguia CHC 401 Ainaro CHC202 Wailili 402 Hautio203 Laga 403 Leolima/Hatu Udo204 Quelicai 404 Ainaro District205 Venelale 405 Cassa206 Vermasse 406 Manununu Health Post207 Bacau District 407 Suru-Crai Health Post208 Lavateri 408 Hatabuilico209 Larissula 409 Bonuk210 Ossohuna 410 Beikala Ailora211 Bucoli 411 Manelobas212 Buruma 412 Maughiga213 Atelari Health Post 413 Liurai Health Post214 Sagatate 414 Maulau

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215 Salari 415 Moneto216 Afaca 416 Maubisse Hospital 217 Caliobere/lelalai218 Makalaco219 Nunira220 Laisorulai221 Bahamori222 Bercoli223 Samalari224 Osso-Waq225 Uaoli226 Osso-Wal/Ossoala227 Uatu Lari/Lolubu228 Vaigue229 Bacau Hospital

500 Bobonaro District 700 Lautem/Los Palos District501 Atabai 701 Iliomar502 Balibo 702 Lautem503 Bobonaro 703 Los palos CHC504 Marco 704 Luro505 Opa 705 Mehara506 Maliana Dental 706 Los palos District507 Maliana District 707 Kain-Liu/Malu-Hira508 Adabaisalala 708 Baduro509 Rairobo 709 Com510 Batugade 710 Daudere511 Kowa 711 Laiuai512 Saburai 712 Muapitine513 Hauba 713 Poros514 Leber 714 Alto Laleno515 Morobo 715 Lacava516 Sibuni 716 Iradarate517 Bilimao 717 Terilolo518 Genuali 718 Pitileti519 Purgua 719 Cacaven520 Palaka 720 Leuro521 Leohitu 721 Lore522 Nunudoi 722 Barucafa523 Raiheu 723 Wairoque524 Gildapil 724 Tutuala525 Lebos526 Lour527 Maliana Hospital

600 Emera District 800 Liquicia District601 Atsabe 801 Liquica CHC602 Ermera CHC 802 Maubara603 Gleno District 803 Fatumasi

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604 Hatolia 804 Liquicia Dental605 Letefoho 805 Liquicia District606 Railako 806 Hatuquessi607 Ermera District 807 Guico608 Asulao/Sare 808 Motaulum609 Aitura Estado 809 Tibar610 Lauala Atas 810 Acomano611 Fautbolo 811 Ulemera612 Fatubessi 812 Leorema613 Manubo 813 Darulete614 Maunsae 814 Maubara-Lisa615 Leimea Kraik616 Koliate Leo Telo617 Hatugau618 Hatukehie619 Leimea Leten620 Lasau621 Railako Leten622 Malata

900 Manatuto District 1200 Suai District901 Manatuto CHC 1201 Macus902 Orlalan 1202 Belulik Letten903 Lakumesac/Mantane 1203 Fohoren904 Laleia 1204 Holpilat905 Samoro 1205 Salele906 Umaboco 1206 Zumalai907 Manatuto District 1207 Suai 908 Cribas 1208 Suai District909 Ilimanu 1209 Alas Tehen910 Salau 1210 Dato Tolu911 Funar 1211 Lactos912 Kairui 1212 Has-Ain913 Sananain 1213 Beco914 Barique 1214 Gala 915 Manufahi 1215 Elalawa/Lalawa916 Fatumakere 1216 Beilaco917 Hatu Konan 1217 Bulu918 Manehat 1218 Suai Hospital919 Iliheu920 Lei/Pualala921 Hohoroi 1300 Viqueque District922 Manelima 1301 Viqueque - District

1302 Uatolari1000 Manufahi/Same District 1303 Osso1001 Same Town /Babulu 1304 Dilor1002 Welaluhu/Clacuk 1305 Uato Carbau1003 Caimau 1306 Viqueque - District1004 Mahaquidan 1307 Afa Loi Kai/uato Carbau1005 Same Town District Services 1308 Saneahu

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1006 Fahinehan 1309 Buikarim1007 Liurai 1310 Lia Ruka1008 Besuso/Umaberloik 1311 Luca/SP31009 Rotuto 1312 Aflocai/ Uatolari1010 Novo Mahaquidan 1313 Beacu1011 Taitidak/Feriksare 1314 Ossu Rua1012 Kaikasa 1315 Makadiki1013 Foholau 1316 Nahareka1014 Grotu 1317 Bahatata1015 Betano 1318 Ulusu1016 Simpang tinga/Daisua 1319 Bui-Lale1017 Holarua 1320 Wai Bobo1018 Tutuluro 1321 Nunumalau

1322 Waimori Tula1100 Oecusse District 1323 Vesosru1101 Citrana1102 Passabe1103 Baqui1104 Bobometo1105 Maquelab1106 Oelcaem1107 Quinat1108 Lelaufe/Bebo1109 Malelat1110 Tumum1111 Pune1112 Nitibe/Ustaco1113 Oecusse Hospital

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Activities for budgetACTIVITY

2100 Maternal Health2101 Family Planning2102 Safe Motherhood2103 Reproductive Health2104 Monitoring & Evaluation

   2200 Child Health2201 IMCI2202 Nutrition2203 EPI2204 Monitoring & Evaluation

   2300 Communicable Disease Control2301 Malaria and Dengue2302 Maintain/strengthen National TB Programme2303 Filariasis2304 Leprosy2305 Implement HIV/AIDS prevent activities2306 Monitoring & Evaluation

   2400 Non-Communicable Disease Control2401 Implement Mental Health Program2402 Implement Dental Health Program2403 Implement Eye Care Program2404 Develop & implement disaster management program2405 Maintain Ambulance Services2406 Monitoring & Evaluation

   2500 Environmental Health2501 Develop capacity and plan in Environmental health 2502 Monitoring & Evaluation

   2600 Health Promotion2601 School Health Promoter2602 Family Health Promoter2603 Support integrated health promotion activities2604 Monitoring & Evaluation

      

2700 Strengthen District Health Management System & Capacity Building2701 Develop/apply admin.procedures2702 Provide guidance & supervision of service delivery2703 Monitoring & Evaluation

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Annexure -3 (To be Revised)TERMS OF REFERENCE FOR DHMT

Order issued by Ministry of Health (MoH)

Composition: District Health Manager – Chairperson District Finance in Charge - Member In charge of HIS – Member Program officers – MCH, CDC etc. Members Head of the CHCs – Members Representative of an NGO working in the field of health One private practitioner selected by the chairman of the team

Terms of Reference Meet once a month on first Monday Review and Monitor the progress of the previous month Prepare a plan of action for the next month as per the stated objectives in the district

health plan. The DHMT will maintain the minutes of its meeting and prepare a monthly

progress report The district health manager will act as a facilitator and help the district Health

Team in implementing the action plan

Activities at the district(a) Financial Management

Maintain all the records of the receipts and payments (Debits and Credits) in the register (Book keeping)

Maintenance of register with item code (as per the line items) Register on disbursement of funds to CHCS and peripheral health institutions Asset register for district office and CHCs Record of Expenditure by item Training of the CHC staff on the financial management and record keeping

(b) Planning, monitoring and supervision Training of the HMIS sASO and sector supervisors along with computers from the

block Information analysis, gathering, recording, reporting and feedback Provision of registers Installation of computers at block level Training of ASO and computers in computer management Registers to be supplied for record keeping of hospital (OPD/lab etc)

(c) Human Resources Development Problem Solving meetings-Class IV, Class III and Class II staff at district level Maintenance of Attendance register Maintenance of TA claim register Maintenance of Medical Claim register Provision of registers

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The health care is provided by various institutions

The country is quite rich in natural resources, with a chunk (nearly 90 per cent) of its revenue coming from oil. In addition, the country also attracts direct foreign and bilateral grants from various parts of the world. However, the management of these funds has always been a difficult because of the lack of skilled manpower. The present document aims to look into the details of the current financial management of the health sector of Timor Leste. The document does not make any attempt to criticize the current management systems, rather tries to identify the gaps and suggests appropriate measures to rectify them.

Insert the flow charts

When preparing the planning document, it is important to note that sub-district health plans are consolidated into one district health plan. Similarly, district health plans are consolidated into one plan for the district health services section of the national plan.

The tables shown here use the figures for the year covered by the annual report, the current year, and the three years in the planning period. The dates shown in the examples of tables are based on a planning period covering the three years of 2009/10, 2010/11 and 2011/12, with comparative actual figures for 2001/02 and estimates for 2002/03. In some of expenditure tables, historical data has been added for an additional y ear (2000/01) to match with PSP requirements. All tables should be accompanied by narrative explanations. A checklist of tables is provided in Annex D.

A list of relevant definitions and norms can be found at the end of the Manual (Glossary)

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Preparation of plan and operational targets(Explained in Module-1)

Budgeting: Resource Requirements

Accounting, recording and processing financial transactions

Monitoring variances and performance

Reporting (Communicating results and recommending actions

Decision making and taking action

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Annexure - 1

IV GOVERNO CONSTITUCIONAL

MINISTÉRIO DA SAÚDE

Gabinete do Ministro da Saúde

Guideline Nº01/2008/IVGC/MS

REGARDING THE UTILIZATION OF GENERAL STATE BUDGET AT THE MINISTRY OF HEALTH

Considering the need to implement health programs in accordance to the General State Budget (GSB) allocated to the Ministry of Health (MoH),

Following the Regulation on Budget and Financial management and the manual for financial managemnet issued by the Ministry of Finance (MoF),

The Minister for Health determines the following as Guidelines:

1. Services/Structures defined as spending entities of the GSB allocated to the MoH include:1.1. Central Services;1.2. District Health Services (DHS) in all 13 districts and all Community Health

Centres within the DHS;1.3. Guid Valadares National Hospital;1.4. Referral Hospitals for Secondary Care at Baucau, Maubisse, Suai, Maliana and

Oe-cusse;1.5. The Institute of Health Sciences;1.6. The National Laboratory;

2. GSB spenditures are disbursed according to the following mechanisms: 2.1. Salary and Wages follow a centralized disbursement, i.e. MoF will undertake

payments according to existing mechanisms;2.2. Goods and Services, Minor Capital and Capital Development are procured by

Central Services at MoH or by MoF, depending on the decentralized amounts

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stipulated in the procurement Decree-Law. After being procured, National Treasury will undertake payments according to existing mechanisms;

2.3. Spending entities within MoH as mentioned in point 1 of this Guidelines are authorized to withold Advancement Funds (AF), as a form of disbursement to undertake expenditures in the category of Goods and Services, with a maximum of US$5000/expenditure;

3. Disbursement of AF to entities as mentioned at point 1 of this Guidelines is done in the following way:3.1. AF disbursement depends on the size of the Service/Structure, its existing needs

and the Monthly Activity Plan of each of them;3.2. AF varies between US$ 15,000 to US$ 20,000/month, depending on the criteria

defined at point 3.1. of this Guideline;3.3. Disbursement is done every quarter; 3.4. AF can only be used to finance:

3.3.1 Activities included in the Monthly Activity Plan;3.3.2 Operational expenses related to stationary, small repairs of building,

vehicles or other equipment, cleaning materials and other expenses that do not need to be centralised at Central Services or DHSs;

4. The following are mechanisms to get access to AF:4.1. Every Service/Structure submit na AF request equivalent to three months/quarter

attaching its Quaterly Activity Plan; 4.2. Upon approval by the Minister for Health AF disbursement will financial

trasaction mechanims stipulated by MoF. Those places with access to a Bank, money is transferred tthorugh the Bank; Those places without Access to a Bank, National Treasury at the MoF will issue a cheque and each Service/Strucure wll cash it for its expenditure;

4.3. Bank transfers or bank cheques will bear the name of the Service/Structure and its respective Director;

5. Distribution of AF within every Service/Structure should comply with the following points:5.1. AF should be distributed according to Monthly Activity Plans of Departments,

Units and Divisions within each Service/Structure; 5.2. Each DHS should distribute the AF according to Monthly Activity Plans of the

Technical Programs Services, Administrative Services, CHCs and Health Posts;5.3. Each CHC should get AF with a minimum value of US$1,500/month;5.4. CHC should provide to Health Posts within its catchment área a minimum value of

US$100/month;

6. Financial management of AF should follow the procedures currently in place. Departments, Units, Divisions, CHCs and Health Posts should have a register of transactions, following the model currently utilized by all Services/Structures.

7. Financal Reports should be in accordance to the following procedures:7.1. Its should have a short narrative report of activities undertaken within the month,

with an attchment of the financial expenditure statement annexing all invoices and other original documents proving the undertaken expenses;

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7.2. Financial Reports should be submitted at the National Directorate of Planning and Finance located at the Central Services, maximum at the 15th of the following month. Those not complying with this time limit can be penalized by the undisbursement of the AF related to the following quarter;

7.3. Financial Reports from Nacional Directorates, Departments, Units, Divisions and CHCs should be submitted through the respective Services/Structures (Services/Structures as mentioned at point 1 of this Guideline);

7.4. Every Service/Structure can provide a summary of the reports but have to attach all the original Financial Reports to the Nacional Directorate of Planning and Finance located at the Central Services.

8. The distribution of tasks regarding the authority to manage AF or other budget allocated to the Services/Structures as mentioned at point 1 of this Guidelines, should be in accordance with the following:8.1. Director-Generals, National Directors, District Directors and Heads of CHCs

should play the role of Autorizing Officers, who have the responsibility to give final approval to the Monthly Activity Plan, approve expenditures to be done, approve payments and approve the Financial Report to be submitted to the National Directorate of Planning and Finance at the Central Services;

8.2. Hospital Administrators, Deputy Director-Generals, Deputy District Directors and the Responsible Officers at the Division for the Coordination of Activities Implemented in the Community within CHCs should play hte role of Certifying Officers, who have the responsibility to verify that expenditures are done according to plans and available budget, that expenditures and payments are done according to undertaken activities and verify invoices are not fake or fictitious;

8.3. Head of Financial Departments, Financial Officers at DHSs, and the Responsible Officers at the Division of Administration and Logistics within CHCs should play the role of Administrative/Financial Officers, who have the responsibility to manage day-to-day expenditures in accordance with the Monthly Activity Plans, to mantain a register of transactions, to prepare Financial Reports, attaching all invoices related to expenditures and mantain a comprehensive file of Financial Reports.

9. Any doubt regarding the content or implementation of this Guideline can be clarified with the National Director for Planning and Finance, and if this is not yet appointed, clarification can be sought with the Head of Finance Department currently under the National Directorate of Administration, Finance, Logistics and Procurement.

Dili, 14 January 2008,

DR Nelson Martins, MD, MHM, PhD Minister for Health

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Annexure - 2

IV GOVERNO CONSTITUCIONAL

MINISTÉRIO DA SAÚDE

Gabinete do Ministro da Saúde

Guideline Nº03/2008/IVGC/MS

REGARDING PROCUREMENT PROCEDURES AT THE MINISTRY OF HEALTH

Considering the needs to implement health programs in accordance with the General State Budget (GSB) allocated to the Ministry of Health,

In compliance with the Decree-Law Nº10/2005, on public procurement,

The Minister for Health determines the following to be used as guidelines:

1. All procurement and contractual procedures should comply with the current legislation. Whenever any exception is needed, a decision should be granted from the Minister for Health.

2. The authorised authority to sign all official documents related to the decentralised procurement at the Ministry of Health22 is the National Director for Administration, Logistics and Procurement. When this National Director is not yet appointed, the current National Director for Administration, Finance, Logistics and Procurement should undertake this function.

3. All administrative and tecnical aspects of procurement shall be the responsibility of the Department of Procurement, including the maintenance of a comprehensive filing system of all procument and contract documents.

22 Note from the translator: The Decree-Law nº10/2005, in its ammendment provided for in the Decree-Law nº14/2006 stipulates a ceiling value of US$100,000 as the decentralised value allowed for every ministry to undertake its own procurement and regularly reporting to central procurement at Ministry of Finance.

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4. When preparing the bid docements and specifications, the Department of Procurement should request the relevant Services/Departments/Divisions/Units to prepare specifications, according to their specialties or according the budget allocated to each one of them on goods, services, minor capital and works.

5. The procurement cycle shall consist of the following:5.1. When the GSB for MoH is approved, the Department of Procurement should take

the initiative to work with the Department of Finance to prepare a Procurement Plan for the approval of the Minister for Health. The plan should include the following:5.1.1 Item to be procured;5.1.2 The estimated budget for each item;5.1.3 The procurement method in accordance with the current legislation;5.1.4 The timeline to process the procurement;5.1.5 The timeline for the execution of the contract until the closure of the

contract and the final payments are made. 5.2. As soon as the plan is approved by the Minister, the Department of Procurement

should mobilise relevant entities mentioned in point 4 of this guideline to start preparing the biding documments and specifications;

5.3. When the bid documments and specifications are complete the Department of Procurement should coordinate with the Permanent Comission for Procurement at the Ministry of Health, defined in the points below, to start the procurement process.

6. The Permanent Comission for Procurement at the Ministry of Health, shall have the following composition:6.1. National Director for Administration, Logistics and Procurement;6.2. One permanent member appointed by the Minister for Health;6.3. One permanent member from the Department of Finance;6.4. One permanent member from the Department of Procurement;6.5. One permanent member from the Department of Logistics;6.6. One variable member from Services/Departments/Divisions/Units with tecnical

knowledge regarding the specifications of the item under procurement;6.7. One variable member from the Services/Departments/Divisions/Units which will

be the beneficiaries of the item under procurement;7. The Permanent Comission for Procurement at the Ministry of Health shall be

appointed:7.1. Through a ministerial executive order, for the permanent members. This executive

order shall also appoint the chair of the commission;7.2. Through a letter signed by the chair of the permanent commission, for the variable

members;8. The Permanent Comission for Procurement at the Ministry of Health has the mandate

during the financial year to:8.1. Decide on the invitations for all bids;8.2. Evaluate all bids and make recommendations on the successful bids to the Minister

for Health;8.3. After the signing of the contract by the assigned authority, supervise and monitor

the execution of the contract;

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8.4. Supervise and monitor the payments made by the Ministry of Health;8.5. Present regular reports to the Minister for health regarding the implementation of

the procurement plan and the execution of all contracts with copies to the Vice-Minister for Health, the Inspector of the Office of Inspection, Fiscalization and Auditing as well as to the Director General Ministry of Health.

9. During the contract execution:9.1. The Departament of Procurement continues to undertake its technical and

administrative functions;9.2. The Departament of Logistics has the responsibility to issue receive and

inspection certificates following decisions by the permanent commision, to facilitate payments;

9.3. The Departament of Finance has the responsibility to process payment instructions in accordance to the contract, and after receiving the invoices and receive and inspection certificates;

9.4. Services/Departaments/Divisions/Unit, which are beneficiaries of the deliverables of the contracts have the responsibility to monitor the execution of the contract, and provide confirmation as to whether or not the execution of the contract is following the terms and conditions defined in the contract, before the permanent commision takes a final decision to order the payment. To fulfill this responsibility they should also be given a copy of the contract.

10. Maintenance and repair of vehicles of the Ministry of Health should follow the Guideline Nº01/2006/IIGC/VPM-MS, dated 11 September 2006.

11. Procurement of pharmaceuticals, vaccins, ragents, consumables and medical equipment shall be done by SAMES, following mechanisms to be defined separetely.

12. All documents and correspondence related to procurement or contracts should be done, whenever possible, in Tétum.

13. Any clarification needed regarding the content and implementation of this guideline shall be sought from the National Director of Administration, Logistics and Procurement, and if this National Director is not yet appointed clarifications can be given by the current Nacional Director for Administration, Finance, Logistics and Procurement.

Dili, 4 February 2008,

DR Nelson Martins, MD, MHM, PhD Minister for Health

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Annexure - 5(1) Background

Geographic: The geographic information should include a map of the district showing sub-districts and the location of health facilities in the district. The communication facilities and roads should also be included.

Demography: The information can be collected from census and projected population by the MOH and department of statistics, Timor Leste.Table 1: Demographic profile of the district

Year Population growth rate

Sub-district- 1

Sub-district-2

Sub-district- 3 ...

Sub-district- n

District total

2007-082008-092009-10Population density

Socio Economic data: Data on the socio-economic status of the households. The indicators are:

1. Percent of household with piped water supply2. Percent household with no toilet3. Percent of household with electricity4. Per-capita income 5. Unemployment rate

(2) Health Status

A description of the main health problems in the district is essential information for stakeholders and forms a vital basis for planning. Necessary information includes basic health indicators, incidence and /or prevalence rates, and main causes of death. They can be obtained from the district level itself. The definitions and the formulae on how to calculate these indicators are Annexed. It is better if the values of important health indicators are plotted against the year.

Table 2: Health status targets and indicators

Indicators Actual 2007-08 Actual 2008-09 Target 2009-10Infant mortality rate Under 5 mortality rate Maternal mortality rate Low birth weight rate Etc...Main causes of deathAnaemiaHIVTBMalariaTraumaEtc...

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Incidence and prevalence HIV prevalence Reported cases of TB Reported cases of Malaria Syphilis prevalence Etc...

The basic purpose of carrying out an analysis of health status indicators is to outline the key challenges that the health sector is facing.

3. Service platform

The analysis of the service platform includes a review of the numbers and distribution of facilities and transport, and the state of infrastructure and physical condition of the facilities. It also includes a comparison of the required staffing with the app roved and actual staffing levels.Table 3: District Health Services facility by sub-districtIndicators Actual

2007-08Actual 2008-09

Actual 2009-10

District target 2007-08

National norms

Sub-district- 1Numbers: Visiting points ClinicsCHCsHospital beds Per person:Population per clinicPopulation per CHCBeds / 1000 populationEtc.Sub-district 2..........Sub-district 3..........

The same should be continued for each sub-district. The definition and the data required to comp

Transport is a critical part of service delivery and support structure and an analysis of the distribution and use of vehicles is important: Table 4: Mobile clinics 2009-10 (Example)

Sub-district / location

Visiting points Number of vehicles

Average visiting points

per vehicle

Total annual kilometres

Average kilometre per

vehicle Sub-district 1Sub-district 2Sub-district 3Etc.......Total

Table 5: Support vehicles in 2009-10 (Example)

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Sub-district / location

Number of vehicles

Population Population per vehicle

Total annual kilometres

Average kilometre per

vehicle Sub-district 1Sub-district 2Sub-district 3Etc.......Total

Facility assessment: It is also important to understand the degree to which facilities have the basic infrastructure necessary for them to function properly. Following table could be used for the purpose:

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Table 6: Basic infrastructural services in district facility 2009-10 (Example)District - 1 Facility type No. No. (%) with

electricity supplyNo. (%) with piped water

supply

No.(%) with fixed line telephone

Sub-district -1 Mobile clinics Health post CHCCHC with bed Referral hospital

Sub district 2 Mobile clinics Health post CHCCHC with bed Referral hospital

Etc.....District Mobile clinics

Health post CHCCHC with bed Referral hospital

Personnel ( See Peter’s report on Human Resources plan)Table 7: Actual and approved number of personnel (2009-10)

Categories Actual number of personnel

Required number of personnel

Approved number of personnel

Approved as % of

required

Actual as % of required

Medical officersMedical specialistsDentists Dental specialists Professional nursesStaff nursesNursing assistants Pharmacists Allied health professional and technical staffManagers, administrators and logistical support staffOther categories ....

Total

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i This document is the founding policy for the country’s social services. It contains the highest vision that the country aspires to for its people. It is rather expressive but very general. The section on health services lists a range of guiding principles. These include: (a) human resource development (b) cultural, religious and gender sensitivity (c) quality and relevance (d) sustainability (e) equity and accessibility (f) social solidarity (g) ethics and efficiency in public service (h) legality (i) creativity and innovation (j) protection of the environment. The document goes on to further specifically include adoption of primary health care policies. Strategies will include “primary health care as a system of essential health care, based on practical, scientifically sound and socially acceptable methods and technology made universally accessible to individuals and families in the community through their full participation and at a cost the community and country can afford to maintain . . . in a spirit of self reliance and self- determination.” This statement mirrors definitions of primary health care listed in the original Alma Ata Declaration on Primary Health Care and other contemporary public health texts.

ii The Health Policy Framework supports the principles of the National development Plan. It is a policy document which contains the MoH vision, values, mission statement and goals. As such the Health Policy Framework defines the key areas for policy development along with guiding principles which further support a primary health care approach to health. Six macro-policy areas have been defined for further development: (a) Priority setting in Health (b) Health financing (c) Human resource development (d) Organisation and management (e) Drug policy (f) External assistanceIntegral in the strategic approach are the core principles of primary health care. These are identified as:(a) a multisectoral approach to health (b) community and stakeholder participation (c) addressing health issues and problems of women, children and vulnerable groups, specially the poor, in a participatory manner (d) affordability, accessibility and availability of services and interventionsIn essence, these principles are describing a comprehensive primary health care system although there is no mention of such a framework in the document.