2016 Activities

Semiannual Public Budget Conference 2016 Report.. Experts and Specialists Discuss Medical Referrals, Cash Assistance Transfers, and Temporary Contracts in Government Institutions

Semiannual Public Budget Conference 2016 Report.. Experts and Specialists Discuss Medical Referrals, Cash Assistance Transfers, and Temporary Contracts in Government Institutions

The Civil Society Team for the public budget Transparency (Civil Team) held its semi-annual conference 2016 on Wednesday November 9, 2016, at the Palestinian Red Crescent in El-Bireh, West Bank. The conference aim was to shed light on Government spending during the first half of the current year (i.e., Jan.-June 2016).  The conference also intended to discuss decisions taken by the government concerning the adopted austerity and rationalization plan, as well as to examine the relationship between these decisions and the expenditures of three budget items, tied to depleting the Public Budget; these are: Medical referrals outside institutions of the Ministry of Health (MoH), cash transfers for social assistance, and temporary contracts in the public sector.

The opening statement of the conference was given to Mr. Abd-Alqader Al-Husseini, Head of the Board of Directors of the Coalition for Integrity an Accountability-AMAN (secretariat for the Civil Team). In his statement, he pointed out that this conference comes within the framework of the Civil Team’s efforts to promote transparency of the public budget, and the Team’s belief in citizen’s right to access financial information of the budget. He added that the purpose of today’s sessions is to examine what has been achieved by the Palestinian government in areas concerning austerity and rationalization during the first half of 2016.
Mr. Husseini called on the Ministry of Finance (MoF) to involve civil society and the media in the management of public funds. He also suggested that the MoF take into consideration recommendations of this conference. In addition, he hoped that the ministry will take the “Citizen’s Budget” seriously and deal with it with more responsibility and consideration so as to provide accurate and timely information in Arabic, and not English as in the past. 

The 2016 Mid-Year Public Budget: Estimated versus Actual

Ms. Hama Zeidan, member of the Civil Team, presented the first part of the analytical paper prepared by the Team. In her presentation, Ms. Zeidan focused on compliance of the MoF with legal references governing the budget. in this regard, she pointed out that the Ministry did not comply with legal deadlines for the preparation and approval of the draft budget law for the current year.  In analyzing the 2016 budget items, Ms. Zeidan said that the draft budget did not include a list of economic and social objectives the Palestinian National Authority (PNA) intended to achieve. She mentioned that the MoF did not publish the Citizen’s Budget until June of last year and in English only, which defeats the purpose. She noted that the Citizen’s Budget was to be written in Arabic and in as simple a language as possible, since it addresses the average citizen.
Based on the abovementioned, there exist real problems in regard to applying the principles of transparency concerning disclosure of the public budget and its details. There are also other problems concerning compliance with the governing laws of the budget exemplified by lack of submission of the budget to the legislative council two months before the end of last year (i.e., November 1, 2015).  Zeidan also pointed out that the public debt problem still exists despite the fact that the government and the MoF have made promises to reduce it. As it stands, public debt was only reduced by a mere 1.71% only.  Furthermore, the 2016 budget did not include details regarding the Palestinian Pension Fund and salaries, nor of the amount of money the government borrowed from the fund.  In that regard, transparency within the fund is not only important but also vital, especially after the issuance of World Bank report last September stating that the amount borrowed from the fund by the government amounted to 1.6 billion dollars.
Within the same context, Zeidan confirmed allocations for the security sector still has the lion’s share of the public budget. In the first half of 2016, this sector’s expenses accounted for a sum that comes to approximately the same total of expenditures for the Ministry of Education and Higher Education (MoEHE) and the Ministry of Health (MoH) combined. Moreover, the salary and wage item of the security sector still consumes and depletes the largest share of its expenditures. It also exceeds the “total budgets” for the Health and Social ministries combined.
At the end of her presentation, Ms. Zeidan, on behalf of the Civil Team, called on the government to comply with provisions of the Palestinian Basic Law when preparing all stages of the public budget. She also urged the MoF to engage civil society in the preparation by providing an opportunity for community discussions prior to approval. She said that government is asked to respect its obligation of adopting the participatory approach with civil society by providing an opportunity for the Civil Team to review the draft budget at the proper time. Ms. Zeidan also recommended the adoption of a well planned rationalization program that is fully transparent especially in regard to the “transferrable expenditures” item, and to continue to filter the wage and salary item. 

Medical Referrals outside Institutions of the MoH; Importance of Reforming the Current Health Insurance System

The first session focused on medical referrals in terms of the extent by which integrity and transparency are being applied in the selection process. (i.e., who and why a particular case is preferred over another). The importance of clarifying this is triggered by the amount of money these referrals cost the public budget which is 32% of the MoH budget, according to Mr. Waleed Abu-Ras, moderator for this session. He went on to say that what is more important is to find out the level of justice applied in decisions taken in regard to these referrals, as well as to question the absurd amounts paid for Israeli hospitals and medical clinics, labeling it as formal theft, which accounted for 12% of the total number of referrals and 22% of the MoH’s budget. 
Researcher Mr. Jehad Harb, presented the background paper on medical referrals with focus on health insurance. He said joining the insurance is made easy for citizens and provides an opportunity for exploitation. To explain this further, he said many citizens join/buy health insurance when they become ill. They pay fees for a short period of time or until they are well and have received the entire medical treatment needed and then stop paying their fees. This  and ends up costing the public treasury enormous amounts of money as data indicates that insurance fees collected in 2015 reached the amount of 165 million Israeli Shekels (NIS) covering only 30% of expenditures for medical referrals, which amount to 561 million NIS,  accounting for 10% of the total expenditures of the ministry.
On a positive note, it is worthy to note that the MoH succeeded in nationalizing the service by 82% in 2014, rising to 86% in 2015. The cost of treatment in 2015 was approximately 561 NIS, marking a decrease of 9 million NIS from the previous year despite the rise of medical referrals by 13000 cases from the previous year.
In regard to challenges, Harb confirmed that it is related to lack of transparency in criteria and procedures; the absence of a clear and transparent definition of “health packages”; the large number of external service providers used, and lack of transparency in contractual arrangements with these providers; in addition to the absence of quality of service indicators, which was adopted by the MoH; all of which have led to weakness in monitoring and control over medical referrals. 
Moreover, medical referrals also lack transparency in criteria which defines the various illnesses and methods of follow-up and control, hence leading to weakness in the monitoring and auditing of financial claims and related accounting process. There is also weakness in the quality of documentation and information management in the registration process as there is no automation of transactions. This is not to mention the weakness in the complaint system in light of the absence of a strategy for the health sector at the MoH, which defines expected roles for each of the public, private and civil sectors. 
Harb recommended at the end of his presentation the adoption of a transparent public policy that determines services provided by the public health sector, along with clear arrangements to assess the contractual offers with hospitals and health centers that provide these services. He also recommended automation of procedures concerning medical referrals outside the MoH institutions; building capacities of the human and technical resources within the MoH.  He also recommended the development of a complaint system to strengthen accountability and increase trust in the Palestinian health system and performance of the MoH, especially within the outsourcing department for “referrals outside the MoH institutions. 
Dr. As’ad Rimawi, Deputy Minister at the MoH, confirmed his ministry’s firm belief in the principles of transparency and systems of accountability as an approach to work. Dr. Rimawi attributed the increase in the number of medical referrals, during the past few years, to the increase in new and different types of diseases which have surfaced in Palestine, hence its treatments. This is in addition to the difficult political situation experienced by citizens living in the West Bank and Gaza, where the citizen finds him/herself forced to resort to paying a bribe at times; or to the use of wasta in order to obtain the services.
Dr. Rimawi considered the responsibility of medical referrals is a public responsibility, and not the sole responsibility of the MoH. He said the MoH has exerted tremendous effort to nationalize this service and sought to eliminate all referrals to Israel and other external medical centers outside the MoH institutions, hence eliminating accompanying medical bills. This was embodied in the establishment of the National Cancer Center, where the share for cancer patients has exceeded 50% of referrals.  In regard to the current health insurance system, he said that this is purely a political issue which burdens the MoH and costs it exorbitant amounts of money. However, he said that “we are currently developing a new health system that will solve the present problems”.
For his part, Dr. Yaser Abu-Safia, Head of the Civil and Private Hospitals Union, described the present health system as “unjust” due to the fact that insurance fees are deducted automatically from salaries of  public employees while other citizens join upon getting ill and in need of treatment. Therefore, Abu-Safia stressed the need for developing a comprehensive medical insurance system that protects and benefits rich, poor, healthy or sick citizens alike.
Moreover, Abu-Safia considered the current system of medical referrals to be a burden on the national treasury as well as on the budget of the MoH.  Furthermore, it is marred by gaps related to injustice concerning the share of referrals made not only to national and Israeli hospitals but also to Palestinian hospitals.  He pointed out that the cost of treatment in Israeli hospitals is three times that in Palestinian hospitals.  This means that nationalization of this service will have positive returns in terms of lowering the cost of the service on the one hand and tax revenues paid by the local hospitals to the PNA, on the other hand.  
Furthermore, Abu-Safia pointed out the urgent need for the MoH to follow an approach that ensures respect for balance and equality in the distribution of medical referrals to hospitals. This is feasible by demanding a requirement from these centers/hospitals to earn an accreditation from a nationally and or internationally recognized medical body.  In addition, it is equally important to establish a computerized insurance system, which allows the Ministry to instantly access and follow up on information concerning referred patients in order to control treatment charges made by these hospitals. 

Cash Transfers for Social Assistance: Need for Consolidating Routs and Channels

Dr. Azmi Shuaibi, Advisor to the Board on Anti-Corruption Policy-AMAN, in his capacity as the moderator opened the second session by saying that cash transfers that are part of the program carried out by the Ministry of Social Development (MoSD) is intended to help the poorest of the poor among the Palestinian people. However, due to the increasing demand for this assistance, the cost on the ministry’s budget has translated into huge sums of money. In turn, this prompted some people to ask the ministry to reconsider standards applied in the distribution of this type of assistance. Other issues concerning cash transfers include lack of consolidation of supervisory and distribution bodies, defining beneficiaries through a transparent process in order to ensure transparency and avoid duplication of families or individuals benefiting from this assistance.  
Mr. Mu’ayyad Afeneh, a member of the Civil Team, presented the paper on cash transfers. He pointed out that the study revealed the absence of a governing legislation for cash assistance; an absence of an actual connect between relevant laws concerning social affairs, and the current cash assistance programs; in addition to the multiplicity of bodies that provide cash assistance in Palestine without a computerized link between them, hence creating a situation that can be described as “cash transfer chaos”.
And while the MoSD was able to develop an institutional and regulatory framework for cash assistance, and worked to reduce the exclusion error by adopting a mechanism that distinguishes between the extreme poverty line and the national poverty line taking into consideration a small margin, the cadre working in this area need to be better trained. In addition, the MoSD also need to develop a procedural guide specifically for cash assistance.
As for transparency in transfers of cash assistance, Afaneh happily announced that the MoSD, in an advanced step towards transparency and to provide citizens with information and data concerning the Ministry’s programs, issued a citizen’s budget for 2016. However, more transparency is needed where it comes to publishing the number of beneficiaries receiving cash assistance. This is especially important since there are costs and compensations listed in the public budget under the transferrable expenditures item of the MoSD for more than 10 years, while the Ministry has no information or knowledge of where this money is spent in its name since it does not fall under its programs. 
Afeneh recommended that a national strategy be developed for eradicating poverty in Palestine, to later be adopted and ratified by the Council of Ministers. He also stressed the need for developing a legal framework for cash assistance programs in Palestine. In addition, the MoSD should update its selection formula and tools used in choosing beneficiaries, and to activate the computerized link between the various official and civil parties working in the field of social and cash assistance. Finally,  transparency needs to be a given part of all operations, therefore, all parties should publish reports regularly in that regard.
From another aspect, Afaneh suggested a number of solutions for facing challenges related to cash assistance some of which include the launching of an electronic gate for social and cash assistance, hence providing a platform for coordination between parties working in this field, prevent duplicity of assistance, and achieve equality in distribution of assistance. He also suggested the adoption of the National Guide for Preventing Corruption in Humanitarian Aid, and for the ministry to continue to strengthen partnership in cash assistance, as well as in the overall socio-economic development process.  The MoF and Planning should also remove the 2005 “compensation payments” from the social transfers item listed under the responsibility center of the MoSD; and to work on providing the MoSD with logistical means (such as cars) to enable researchers to do field visits.
The Acting Director for combating poverty at the MoSD, Mr. Khalid Al-Barghouthi noted that the Ministry’s work is not limited to cash assistance, but rather includes many undeclared aspects putting the ministry in the forefront of those working in the community protection sector.  He said that the MoSD has always been historically disadvantaged in terms of budget and staff despite the size of work and effort it undertakes in comparison with other ministries.
Barghouthi said that cash assistance constitutes 65% of the ministry’s budget.  He added that the budget was decreased during the past few years, which resulted in decreasing the number of beneficiary families from 119000 to 111000. He also agreed that an electronic link is the only way to ensure transparency in order to detect duplication in the distribution of benefits of cash assistance. Duplication of benefits received is what prompted the ministry in 2008 to try and develop a system and a program that can determine the level of poverty of the applicant. The program was to study the facts and figures away from the human factor.  He said that the MoSD will be held accountable based on the data provided in the program. 
Former Social Affairs Minister, Ms. Majida Al-Masri, considered that for years the cash assistance program was the title for social affairs. It later became a key intervention of the ministry within the social protection program. She said the nature of the political system is recognized by the extent by which it provides this kind of protection to its citizens, which is considered to be an element of steadfastness in the Palestinian case.
Al-MAsri said that despite the importance of the ministry’s interventions, which fall under the cash assistance program, no guarantees of sustainability are given to the beneficiary. And more importantly, the assistance does not provide security or dignity for the receiver due to its basic nature rather than developmental. Therefore, it is vital that a legal framework is developed to ensure sustainability and dignity of the citizen, which will also serve to prevent duplicity of receiving benefits and ensure transparency.

The need to Control Temporary Contracts to Prevent Exploitation of Gaps in the Civil Service Law

A member of the Civil Team, Dr.Issam Abdeen opened the third session of the conference, which discussed temporary hiring in the government sector.  Dr. Abdeen began the session by raising some questions such as: how many temporary contract employees were hired in the public sector in 2015-2016? And if this type contracts is in fact an exploitation of gaps plaguing the Civil Service Law… in addition to questioning the mechanism and criteria by which temporary contract employees land permanent senior positions.
Researcher Dr. Amad Musleh, in his presentation of the research paper on the abovementioned subject pointed out main problems plaguing temporary hiring in the governmental sector.  These problems include lack of defined boundaries for regulating contracts of experts on the one hand, and seasonal and contingency contracts on the other hand, in addition to those hired for permanent positions under a temporary contracts. Problems also include continuation of applying the policy of appointing those with temporary contracts in permanent positions; temporary contract employees are paid higher salaries than their counterparts in the civil service; the persistence of hiring retirees as exceptional cases; failure to comply with many of the procedural provisions contained in the appointment system for hiring experts; lack of clarity in available data concerning temporary contracts, especially when hiring experts and consultants who are externally funded.
Dr. Musleh proposed several solutions for the abovementioned problems some of which include: developing a clear and comprehensive legislation that addresses all issues related to temporary contracts; with a clear distinction between legal provisions governing appointments of experts and consultants and those related to seasonal and contingency hiring. In addition, it is important to develop clear standards and forms specifically for temporary hiring. He also recommended that the policy of allowing individuals with temporary contracts to be appointed in permanent positions. He stressed the need for a strict control over procedures related to temporary contracts including ensuring compliance with conditions and adopted criteria as well as putting a stop to violations stated in the SAACB’s report in this regard. Oversight should be the responsibility of the MoF, the General Personnel Council (GPC) and the State Audit and Administrative Control Bureau (SAACB).  
Mr. Wa’el Al-rimawi, General Director of Career Planning and Job Classifications at the GPC said that the number of the signed temporary contracts since the beginning of this year amounted to 1826; with 1125 of those belonging to the Ministry of Education (MoE). This stems from the Ministry’s belief that hiring staff through a temporary contract provides an opportunity to evaluate the individual prior to hiring him/her on permanent basis. This, in the Ministry’s view, ensures their full contribution to realizing the Ministry’s strategy. Other reasons justified by the MoE include: government’s pledges to donors in light of the precarious financial situation; lack of job vacancies despite the need for more employees, especially in the MoE; and finally the inability to replace employees except in cases of retirees.
According to Mr. Rimawi, the most important achievements for the GPC were reducing the number of permanent positions from 2394 for 2013 to 1640 in 2016, and matching all civil service employees’ data in the GPC, government department, and MoE, and according to job classifications. He stressed the need for establishing a higher committee with members from the Council of Ministers, SAACB, and MoF.  He stated that temporary hiring depends on the needs of the specific government’s department and harmony with job descriptions listed within the classification table.
For her part, Bothaina Salem, Legal Expert, confirmed that temporary hiring needs to be reviewed carefully and holistically with the aim of regulating this process. She also pointed out the necessity for the government to encompass employees with temporary contracts in the Social Security Law if the Pension Law is inapplicable to them.  
Moreover, Salem described the developments which occurred on temporary contracting as modest. She said this was due to the misconception of the issue; fragmentation and the non-integrated relationship between legislations, as well as to government reforms which has nothing to do with rationalization. Due to all that,  no grounds were established to build cumulative interventions for a sound policy concerning temporary hiring in the future.

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