Untapped $500m Funding Chance For Nigeria Health Sector By Toluwani Oluwatola

Untapped $500m Funding Chance For Nigeria Health Sector By Toluwani Oluwatola

The Nigerian health sector is underfunded. While this is no new advancement, the COVID-19 pandemic brought this to the fore once again. In a previous short article, I observed that the allocation to the health sector in the previous five years had actually averaged less than 5 per cent of overall financial allowance in flagrant disobedience to the 2001 Abuja statement made on our soil. While increased effectiveness and transparency within the health sector can make us maximise what we have at the minute, we will not experience much progress up until the issue of perpetual underfunding is dealt with.

As a speaker at the “Financing the COVID-19 Action in Nigeria” webinar arranged by Nigeria Health Watch, Dr Ola Brown ended on a dominant note by stating that: “To solve the issue of underfunding, we require to find a way to execute mandatory taxation to develop a prepayment pool for healthcare in the nation”. She then went on to offer the circumstances of how “telecommunications tax” can act as a plug to make more funds readily available for health.



This concept resonates with the proposition in her book: “Repairing health care in Nigeria” where she kept in mind that the nation might raise an extra $1bn each year by presenting a levy of 1,000 to 2,000 on each telephone subscriber. Dr Ola isn’t a solo voice in promoting for telecoms tax for the health sector. In 2015, a group of leading health policy scientists from University of Nigeria suggested the introduction of uniformity levies on cellphone call tariffs (telecoms tax) as an innovative ways of resolving the challenge of underfunding in the Nigerian health sector. In 2018, a group of Civil Society companies promoted for the intro of mobile phone (telecom) tax to fund the country’s healthcare system.

The telecoms tax is a type of indirect tax in which citizens prepay for health care by proxy through telecommunications business. There is no much better time than now for the federal government to tap into this chance for financing the country’s health sector.

One of the sectors that have actually continued to grow in Nigeria despite the continuous pandemic is the telecommunications sector. In Between January and June 2020, telecom operators earned $5.15 bn (N1.97 trn) in earnings which represents a boost of $149 m ( N57 bn) compared to the revenues within the very same amount of time in 2015. Usually, each customer invests $ 4.51 on airtime purchases on a monthly basis. A tax of 10 Kobo on every naira of airtime purchased would have yielded an additional $515 m ( N197 bn) for the country’s health sector in the very first half of 2020, a quantity that represents 46 per cent of the total financial allocation to health for the year2020 Why should we continue to permit this golden chance slide?

It’s been developed that focused financial investment in healthcare boosts nationwide and individual income. However, with a per capita health expenditure of $739 ( N28,600), the nation must expect minimum returns on her person’s health which will affect the nation’s efficiency and GDP. In light of this, it is necessary to explore offered alternatives to improve the country’s health spending. A special telephone tax for the health sector set between (1kobo – 10 kobo) for every naira of airtime purchased will contribute a lot to the pool of funds available for healthcare in Nigeria, this fund if utilized sensibly and efficiently will have a remarkable favorable impact on the country’s health fortunes.

To make the best of this fund, it will be important for the government to create a bundle of highly cost-effective interventions that will guarantee that all Nigerians get quality healthcare at the main health care level. This intervention may be an extension of the current Basic Minimum Bundle of Health Solutions, covering more population groups or a more thorough package covering maternal and child health, non-communicable diseases, Malaria, Tuberculosis (TB), Human Immunodeficiency Virus (HIV), mental health and common oral health conditions.

A part of the fund ought to likewise be committed to revamping the infrastructural and personnel capabilities of the Main Health Care system to rearrange them to offer quality healthcare for all Nigerians. Before the rollout of this scheme, adequate sensitization of Nigerians about the scheme should be carried out to get citizens buy-in and awareness, required monitoring and examination indications put in location and systems to ensure openness in the allotment and management of funds put into location.

If implemented, Nigeria will sign up with ranks with Gabon, which currently funds healthcare for the poorest members of her society through a mandatory health insurance levy [redevance obligatoire à l’assurance maladie (ROAM), supported by 10 percent of telecom profits. The rollout of a telecommunication tax for the health sector, if implemented in great faith, will improve the fortunes of Nigeria’s health sector and represent an enormous stride towards universal health coverage in Africa’s most populous nation.

Toluwani Oluwatola is a dental expert in Osun State, Nigeria, interested in public health systems particularly health financing block. He’s enthusiastic about the improvement of the health financing landscape of Sub-Saharan Africa.

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