The role of contractual arrangements in improving health sector ...

Pakistan
Each contract generally spells out the agreed mechanisms for resolving any disputes, if
they arise, between the partners. However, the description of the proposed arrangements is not
always sufficiently comprehensive to cover all dimensions of potential dispute between the
partners. There is a need for strengthening the capacity of managers to make effective use of
the current legal framework for smooth operations under the contractual environment.
Capacity: strengths and weaknesses
Purchaser
Many national programmes (such as the AIDS control programme, tuberculosis control
programme, malaria control programme, lady health workers programme), through
experience, have developed arrangements for preparing bid details, inviting bids through open
as well as selective bidding process, evaluating the technical and financial proposals,
negotiating the terms, preparing the documents and awarding the contracts.
The complexity of government financial procedures sometimes delay the release of
funds according to the agreed schedules. The fiduciary management arrangements do vary
across contracts. This implies programme ability to manage the diversity of financial flow
mechanisms across projects. An example is the AIDS control programme effectively working
with multiple sets of financial flow mechanisms, according to the source of funds, e.g.
government, World Bank or GFATM.
Some of the programmes have started strengthening their staff capacity and
arrangements to supervise and monitor the implementation of contracted out projects,
including the financial performance of projects. The programmes have also developed
arrangements for designing and conducting third-party evaluation and evaluation through a
team of experts from within and outside the programme.
Many of the programmes, especially at provincial level and below, are currently
working with a sub-optimal mix of technical and administrative expertise for managing the
contracting process, monitoring and evaluating the performance, and managing finances in a
contractual environment. The limited capacity is related mainly to in-adequate number and
skills of the programme staff, but also includes sub-optimal resources and operational
systems. However, these capacities do vary widely across the programmes. At present the
organizational development plans seem inadequate to address the capacity challenges by
making optimal use of potential opportunities.
Provider
There is wide variation in the technical, managerial and financial capacity of private
sector providers. Technical capacity refers to the ability to analyse situation, develop
strategies and interventions, plan and implement activities etc. Managerial capacity refers to
the ability to write proposals, negotiate contracts, manage resources including staff and
materials, and prepare business plans and reports. Financial capacity refers to: financial
position including assets and incomes, financial systems including accounting and auditing,
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