AUDIT REPORT : RURAL HEALTH DELIVERY SYSTEM

LOAN SUPPORTS IMPROVEMENT AND INSTITUTIONALIZATION OF INTEGRATED LOW-COST PUBLIC HEALTH DELIVERY SYSTEM FOR RURAL POOR WITH ADMIN, TRNG, NUTRITION, ENVIRONMENTAL HEALTH, AND HEALTH FACILITY CONSTRUCTION COMPONENTS. AUDIT BASED ON REVIEW OF MISSION & GOP DOCUMENTS, DISCUSSIONS WITH USAID & GOP PERSONNEL, AND ON-SITE INSPECTIONS. OF $9.5M LOAN (REPRESENTING 52% PROJ COSTS),$2M DISBURSED AND $4M EARMARKED AS OF 12/31/78. TERMINAL DISBURSEMENT DATE IS 2/10/81. PROJ JUDGED BY AUDITORS TO BE SUBSTANTIALLY BEHIND SCHEDULE WITH EXCEPTION OF TRNG COMPONENT. REAL DOUBT EXISTS AS TO WHETHER BALANCE OF PROJ CAN BE IMPLEMENTED AND FUNDS DISBURSED BEFORE TERMINATION DATE. AUDITOR"S RECOMMENDATIONS DEAL WITH REVERSING OF IRREGULARITIES IN USE OF AID REIMBURSEMENT FUNDS AND WITH DEFICIENCIES IN MINISTRY OF HEALTH(MOH) ADMINISTRATION OF PROJ COMPONENTS. ON-SITE INSPECTION OF 46 OF 3457 HOUSEHOLD LATRINES ALREADY REIMBURSED UNDER PROJ REVEALED ONLY 4 ELIGIBLE IN ACCORDANCE WITH PROJ SPECIFICATIONS; USAID INSPECTION OF LATRINES FOUND TO BE GROSSLY NEGLIGENT; LOCAL OFFICIALS MOSTLY IGNORANT OF AID/MOH STANDARDS. MOST POTABLE WATER SYSTEMS CONSTRUCTED TO DATE ARE SMALLER AND COST LESS THAN SYSTEM ON WHICH AID FIXED REIMBURSEMENT COSTS ARE BASED; CONSEQUENTLY,AID OVERCHARGED AND ONLY 66% OF SYSTEMS ARE IN ACCORDANCE WITH PROJ CRITERIA. HEALTH FACILITIES CONSTRUCTION LAGS FAR BEHIND 12/78 PROJECTED TARGETS & MOH EQUIPMENT LIST INCOMPLETE WHEN FINALLY SUBMITTED 12/26/78. UNLESS PHASED PROCUREMENT SCHEDULE DEVELOPED,FACILITIES WILL REMAIN USELESS BLDG SHELLS. NUTRITION COMPONENT ACTIVITIES NOT YET BEGUN AS IMPLEMENTATION PLAN HELD UP OVER 2 YRS BY MOH DESIRE TO AWAIT EVAL OF PREVIOUS HEALTH LOAN COMPONENTS. NEW PLAN(SUBMITTED 2/79) DEEMED REALISTIC BY USAID. AID $100/MO PER DIEM SUPPORT FOR HEALTH ASSISTANTS FOUND TO BE LARGELY FINANCING TRNG COSTS;STUDENTS RECEIVING AVERAGE OF $20. MOH SUPPLY OF TRNG MATERIALS DEFICIENT. ADMIN FUNDS FOR CONSOLIDATING MOH & SOCIAL SECURITY SYSTEM COMPONENTS REMAIN LARGELY UNALLOCATED DUE TO ABSENCE OF CONSOLIDATION PLAN.