By Jeremy Morgan
Latin American Herald Tribune staff

CARACAS -- Doubts hover over Finance Minister Ali Rodriguez Araque's 2010 budget even though it's halfway to getting on to the statute book, and not just because of the likely knock-on effect of global recession and lower oil demand. Not least at issue is the lowly place accorded to the state health system.
The Budget Bill predictably sailed through a first debate at the National Assembly -- which is all but entirely dominated by an overwhelming majority of President Hugo Chavez's supporters -- late last month, and is not expected to encounter obstacles second time round, either.

This was even though skeptical noises were by then being sounded outside government circles. Critical bells have been ringing ever louder ever since. For all the president's emphasis on the importance of the well-being of the people, health gets just 5.9% of the BsF159.4 billion budget for 2010.

In contrast, the Interior and Justice Ministry gets 19%. That said, given Venezuela's at times horrendously high rate of violent crime, people might not grouse about that -- as long as the police do their job, although there are doubts about that.

Budget planners are under suspicion of opting for less services for the same money in 2010. The drawback of this is Venezuelan inflation, the highest in any country in Latin America.

The official inflation index hit 30.9 percent last year, and Rodriguez Araque is forecasting 26 to 28 percent for this year and a little less next year. Elsewhere, economists warn that inflationary pressures are gathering and the outcome for both this and next year may not be any better than last year.

Be that as it may, the implications of spending cuts in real terms look grim for the Health Ministry and the state system under its control. The system is responsible not only for state sector clinics and hospitals, but also overseeing sanitory conditions in the housing and schooling sectors as well.

Apart from cutbacks caused by the combination of frozen funding and rampant inflation, skeptics say the actual figures might not matter very much in the end anyway. The reason for this, they explain, is that last year's spending blueprint didn't go as planned, and there's no certainty next year is going to be any different.

As an instance, they point out the 2009 budget plan included spending of BsF8.358 billion on improving water supply and sanitation at 970,000 housing units across the country. Officials have yet to deny reports claiming that the government actually came nowhere near hitting this target, although the money was spent.

The allocation earmarked for home sanitation in the 2010 budget is exactly the same as this year's. But the performance target is much lower at just 300,000 units -- and, there's no certainty the government will be more successfull next year than it was this year.

Much the same is being said about the government's 2010 blueprint for repairing sanitation at broken down schools, another area in which its record is in doubt. "If this is in the budget, you can say it's a dead letter," said Orlando Alzuru, president of the Venezuelan Teachers Federation.

"The Health Ministry has never occupied itself with sanitary conditions at schools," Alzuro continued. "About 60 percent of the installations are deteriorated. And now, with the rationing of water, we believe that conditions, which are already unhealthy, will get worse."

As to the provision of health care, the government's plans for beefing up clinics and other facilities and services outside hospitals also appear to have taken a step backwards. Again, it appears to be a question of making do next year with what you got this year.

This year, the government aimed to carry out work on 2,920 such centers at a cost of BsF44 billion. The scheme will get exactly the same funding next year, but the target's been cut by around 90 percent to just 300 basic health centers.

More advanced diagnostic centers will also be expected to get by on the same funding as they did this year -- in their case, BsF72 billion. But the budget calls on them to attend to more than twice as many people -- just over 1.6 million in 2010, compared with 709,631 in 2009.

Funding for the state health system has been put on hold across the country. Carlos Walter, a former health minister, calculates that Greater Caracas faces a spending cut in real terms of 17 percent next year compared with this year. The comparable cutback in Miranda state, which surrounds the capital and includes the most populous part of the country and is now under opposition control, will be 41 percent, he says.

Amid signs that the state health system will have no choice but to draw in its horns next year, only two new projects are included in its section of the budget.

One of these is a sex health promotion program worth BsF20.7 million. This is seen primarily as a response to the growing number of under-age mothers. The other, at just over BsF2.6 million, is earmarked for employing 60 members of the Warao, an indigenous community in the Orinoco Delta.
In the funding battle, the state health system is up against Barrio Adentro, Chavez's network of basic medical facilities in poorer districts of the country, particularly barrios in urban areas. This year has seen a spate of reports to the effect that all is not well at Barrio Adentro, with some neighborhood centers closing down for lack of funds and staff.

Just how much Barrio Adentro costs the state and the government is a matter of speculation. Its financing comes from the National Development Fund (Fonden), which in turn is largely financed directly by the state oil corporation, Petroleos de Venezuela (PSVSA). All this cash flow is off-budget, and in effect beyond public scrutiny.

When Chavez set up Barrio Adentro earlier this decade, he asked Cuba to provide about 10,000 trained medical staff including doctors and nurses. The subsequent closure this and last year of some of the network's centers was accompanied by unconfirmed reports that some of those Cubans used Barrio Adentro as a stepping stone to better things in the private sector or the United States.

Be that as it may, Chavez continues to look to Cuba for medical staff to plug gaps in medical care in Venezuela. Cuba has sent 36 "specialist" medical personnel to help out at a children's hospital at Guatire north of Caracas which has found it self short of about 70 members of staff. Officials say that more Cubans could be on the way.