Tanzania Daily News (Dar es Salaam)

Tanzania: Medical Stores Needs Sh2 Trilion for Development Plan

THE Medical Stores Department (MSD) needs about 2tri/- to cover recurrent and development expenditure under its ambitious six-year Medium Term Strategic Plan (MTSP) that runs between 2014 and 2020.

According to the new plan, which phases out the 2007/2013 MTSP, the medical agency plans to realise 1.82tri/- as total revenues from the sales of normal, special and vertical programmes, health commodities and services.

However, the department, which has reported the successful implementation of the previous Strategic Plan, will have to struggle hard to recover the deficit of 15bn/- to meet some current and future development programmes in the Plan.

The six-year strategic plan outlines a number of areas lined up for rolling out of its programmes for the given period, but the department's long term financial sustainability remains a stumbling block.

"Taking into consideration of current and future development requirement of MSD, it is projected that there will be significant financing gap to the tune of 14.9bn/- on capital expenditure to be mobilised from either the government or development partners," read part of the Plan.

MSD's Board of Trustees Chairman Prof Idriss Mtulia, said in a statement that being aware of the social, economic, technological and political changes affecting the health sector in the country, the new plan has identified three pillars of excellence which will transform MSD.

He named them as operational excellence, service excellence and business growth which will have to ensure that MSD live on its revised mission of making available, at all times, medicines and medical supplies of acceptable quality at affordable prices to all Tanzanians.

"Based on the key strategies and objectives stated in this MTSP, the Board of Trustees is convinced that, within the next six years, MSD will achieve its vision of becoming a centre of excellence for health commodities supply chain," he said.

Boasting to improve its financial performance over the last six years, the department however, has experienced a number of setbacks including lack of long term financial sustainability which did not improve as earlier expected.

During the period, it witnessed the decline of the working capital from 81bn/- in 2007 to 24.5bn/- last year, mainly due to the pricing structure which resulted in lower margins and net surplus.

The use of predetermined prices which are fixed on an annual basis, delay and erratic disbursement of funds from the government has put enormous financial strain on MSD, but expects to introduce a number of measures to address that in the new Strategic Plan.

In the new Plan, MSD has plans to introduce some new structures including operating some of its units strategically to enhance performance, increase business visibility and reduce costs.

MSD and the private sector will set up manufacturing plant for IV Fluids, linen products like cotton wool, gauze, topical preparations and syrups so as to reduce dependence on overseas procurement and increase stock availability.

The management arrangement for new MTSP will require re-alignment to the MSD structure using a hybrid of functional, matrix and divisional structure for implementation of MTSP 2014-2020.

"The new Strategic Plan (2014 - 2020) intends to capitalise on the successes of the previous strategic plan and use the challenges that were faced as opportunities for excelling and providing quality and safe health commodities to customers," said Prof Mtulia.

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