Findings published in the Lancet say aid has supplanted some money that would otherwise have been earmarked by governments for health departments

Governments in developing countries have cut the budgets of their health ministries as a result of aid donations they receive for healthcare from wealthy nations, according to a study published today.

The authors of the painstaking and controversial research, published in the Lancet, pointed out that developing world governments have massively increased the amount they spend on health by nearly 100% between 1995 and 2006.

But the substantial extra money in donations for health – whether to treat HIV/Aids or improve maternity care – that in recent years has been arriving from abroad has supplanted some of the money that would otherwise have been earmarked by finance ministers for health departments.

The study, which has major implications for foreign aid policy, was carried out by Professor Christopher Murray of the Institute for Health Metrics and Evaluation, University Of Washington, Seattle, and Dr Chunling Lu from Harvard University and their colleagues. They used records from the World Health Organisation and the International Monetary Fund, but acknowledge that there were major problems getting the data needed, because of the inadequacies of some of the record-keeping within governments.

"For every $1 of DAH [development assistance for health] given to government, the ministry of finance reduces the amount of government expenditures allocated to the ministry of health and other government agencies that engage in health spending by about $0.43 to $1.14," they write. "From the global health community's perspective, this means that to increase government health spending by $1, global health funders need to provide at least $1.75 of DAH."

When they looked at donor funds given to non-governmental organisations (NGOs) for specific projects, however, they found a different picture – government spending went up, not down. But the researchers, and also the authors of a commentary published with the study, warn against simplistic conclusions.

"Many developmental economists might view these findings as evidence of rational behaviour on the part of ministries of finance," write Murray and colleagues. An important question is whether the government money goes instead to education or poverty alleviation which may help prevent ill-health rather than funding the military. Repayment of loans has also been a major issue in the past.

In a commentary, Dr Devi Sridhar and Dr Ngaire Woods, of Oxford University, praise the authors for their "nuanced and careful discussion of their findings", adding: "We worry that others will draw two rather crude conclusions. The first is that development assistance given directly to governments has a negative effect on government spending on health, and therefore funding for health should not be routed through governments. The second is that assistance given to non-governmental organisations (NGOs) has a positive effect on government spending and therefore funding should be routed through NGOs."

Giving money directly to NGOs weakens government. NGOs also do not always co-ordinate well, as was seen in the earthquake disaster in Haiti, or tell governments what they are doing in their country. Murray and colleagues say in their paper that the amount of money paid by donors to NGOs is also unclear, which also makes the conclusions uncertain. They call for more transparency and research.