IPN Health Blog

Making poverty perpetual

According to the sages at the Chronic Poverty Research Centre - an international partnership of universities, research institutes, and non-governmental organisations - the UN’s Millennium Development Goals are not ambitious enough.  Even if they are met, there will remain 800 million ‘chronically’ poor people around the world.

In order to lift these marginalised people from poverty, their report advocates a massive scaling up of state welfare in developing countries, ranging from cash benefits to ‘minimum income guarantees.’

Later this year, the World Health Organization is also likely to recommend expanded social protection – including minimum wages -- as an essential means of improving the health of the poor.

These kinds of interventions are likely to make the problem of ‘chronic’ poverty worse.

Take minimum wages. In richer economies, they don’t cause too much economic damage during times of rising prosperity. The problems start when an economy begins to slow down.

When things get tough, employers will dispense with those they regard as the most marginal workers first, such as unskilled people, part-timers, women, and so on.

But in fragile African economies, asking the private sector to provide ‘minimum income guarantees’ is tantamount to telling them not to bother employing anyone at all. As the World Bank has shown, there are enough bureaucratic hurdles to starting a business in the poorest countries, without this costly extra burden. 

And without a strong private sector creating wealth, there will be no juicy tax revenues to fund state welfare – unless, of course, western governments are prepared to underwrite African welfare systems indefinitely.

Countries like Britain have had enough experience with welfarism to know that it is not the way to eradicate poverty.  As the light shone on Glasgow East during the by-election has amply demonstrated, it entrenches it.

Making Poverty History? Making Poverty Perpetual would be more accurate.

CFD Joins the March of Washingtons

The Campaign for Fighting Diseases is honoured to join a new coalition focussed on increasing access to safe and effective antimalarial drugs.

The coalition is called the March of Washingtons and already has over 50 founding partners, including the Malaria Foundation International and the Malaria Centre at the London School of Hygiene & Tropical Medicine.

One may be confused by the name. March? Washingtons? Malaria? I certainly was. Here’s the idea:

George Washington had malaria.

George Washington, or at least a depiction of his head, features on US one dollar bills.

Now the important part:

For just one dollar a child can be supplied with quality, effective malaria treatment. The dollar also enables quality control tests of malaria drugs on the market.

Yesterday’s blog post raised the issue of substandard drugs and it is an issue particularly relevant to malaria. As previously mentioned, a recent study showed over a third of antimalarial drugs purchased in African cities to be substandard.

Quality medicines should not be the privilege of those in high income countries. The CFD hopes that through coalitions such as this we can help increase the quality of drugs throughout the world.

If your organisation might be interested in joining the March of Washingtons, please contact Africa Fighting Malaria.

Giant Generics Producer Accused of Making Substandard Drugs for Africa

Dominating this week’s pharma news is a story concerning the investigation into Indian generics giant Ranbaxy Inc. 

The company is alleged to have produced substandard anti-retroviral drugs that were distributed to thousands of HIV-sufferers in Africa. 

Now, let us not jump to conclusions. The investigation is not yet complete and the allegations may be dropped. However, this does remind us of the vast threat to public health that substandard drugs can cause – most worryingly due to drug resistance. 

Substandard drugs will often contain inadequate doses of active pharmaceutical ingredient (API). When a person with a disease takes insufficient doses, the drug will fail to completely kill the microorganisms of the disease. As the microorganisms are under attack from the drug, yet not killed by it, they are then able to mutate into new forms which are resistant to the drug. 

This places vast populations at threat from drug-resistant disease mutations. 

One example of such a mutation is the tuberculosis ‘super-bug’ XDR-TB strain (known in more common parlance as Extremely Drug Resistant Tuberculosis), which is now endangering Africa. 

The WHO estimate that 5% of new cases of TB are resistant, whilst 20% of global AIDS patients are thought to be drug resistant.  Substandard drugs will only increase these numbers.

Substandard drugs are rife in low income parts of the world, threatening to cause public health disasters. The Campaign for Fighting Diseases next month releases a report tackling both this issue and that posed by counterfeit medicines.

Let’s stop subsidising failing government healthcare in Africa

G8 meetings follow a predictable pattern. In the months beforehand, campaigners call for more aid to Africa to fight diseases of poverty such as malaria. G8 leaders make grandiose speeches, commit billions of their citizens’ money, which then pours into the coffers of African governments. The health of Africans stubbornly remains poor. Campaigners accuse the G8 of not giving enough, and so on.

The foreign aid situation is becoming increasingly farcical. As William Easterly, author of The White Man’s Burden put it: “The status quo — large international bureaucracies giving aid to large national government bureaucracies — is not getting money to the poor.” As Prof Easterly intimates, the failure stems from the insistence of OECD government donors to give the lion share of aid directly to governments, who they then rely on to plan, manage and deliver healthcare.

The brutal truth is that most health ministries are not up to the job. They have almost no data to tell them if their work is effective and are riddled with corruption.

Donors, meanwhile, judge their own effectiveness by ‘input’ factors such as the number of bednets or drugs distributed, but they often have no information about whether or not health is improving as a result of their activities.

It’s time to scrap this system which is doing little for patients, other than enriching people lucky enough to have jobs in ministries. 

We could, for instance, insist that all British aid is henceforth spent on output-based competitive contracts for delivering healthcare, open to profit and non-profit groups alike. Where this has been tried, as in Cambodia, it’s been an immense success, and is particularly useful for getting services to groups that have been neglected by government provision, such as the rural poor.

The obvious advantage is that if the contract-holder does not deliver results, they don’t get paid.

DfID is currently moving in the opposite direction, increasing the amounts it pays to subsidise general government healthcare. Its blind optimism is rather touching, were it not taxpayers’ money being wasted.

There's further discussion of this issue in our latest CFD discussion paper -  Foreign Aid for Health: Moving beyond government.

UPDATE: There's an interesting discussion on the naivete of general budget support (the new modus operandum of DFID over at Standpoint.