How Budgeting Practices on Health-Care Equipment May Fail Government Hospitals

---

This Policy Note analyzes government hospitals' capital outlay, specifically the budget for equipment used directly in health-care service delivery. It finds that government hospitals do not have maintenance programs specific to their assets, especially heavy equipment. It recommends the conversion of the Health Facilities Enhancement Program into a long-term capital investment fund, which will require the submission of long-term capital investment plans with corresponding maintenance programs. It also calls for the formulation of proper guidelines and protocols for budgeting and maintenance of capital assets, and the vigorous implementation of the New Government Accounting System straight-line depreciation method in calculating the costs of depreciation of property, plant, and equipment.