In 2009, South Africa's health-funding system teetered on the verge of collapse. Despite the adoption of a transparent and credible budget framework in 1994, large parts of the public health system suffered from chronic overspending and poor financial control. As wage hikes and supply costs ate into the health budget and as government revenues plummeted in the wake of the 2008 global financial crisis, the national health department had to find ways to preserve priorities, linking them more effectively to the budget. The department won agreement on a list of non-negotiable expenditure items to protect in provincial budgets, used earmarked conditional grants to channel funds to key programs, cut medicine costs by improving central procurement, rolled out a new information technology system, and improved its monitoring of provincial finances. Although the country's nine provincial health departments had important roles to play, most of them struggled. However, the Western Cape was able to set a model by controlling personnel costs, improving monitoring, and creating incentives for health facilities to collect fees. Nationally, total per-capita government revenues dropped by 5% in the immediate aftermath of the financial crisis and grew only slowly thereafter, but the health sector's strategy helped ensure progress on its key priorities even as resources fluctuated.

Leon Schreiber drafted this case study based on interviews conducted in Pretoria and Cape Town, South Africa, in August 2018. Case published October 2018.

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When Andrius Kubilius became prime minister of Lithuania in November 1999, he faced dual crises. Russia’s economic crash a year earlier had thrown Lithuania’s economy into a tailspin, and the government was in danger of losing its ability to borrow on international financial markets after running a large deficit the previous year. Furthermore, the European Commission had informed Lithuania that the country was falling short in its efforts to join the European Union (EU)—a key element in the Baltic state’s economic and political future. Kubilius’ government devised a plan to manage those crises, but systemic weaknesses in the center of government made it difficult to execute the agenda. The government was unable to ensure that line ministries set aside pet projects, was focused on supporting the goal of EU accession, and was unable to channel the government’s diminished resources to the most important projects. To address these challenges, Kubilius instructed State Chancellor Petras Auštrevi?ius and Government Secretary Algirdas Šemeta to reform the policy planning process to focus ministries on EU accession and other strategic goals, and to synchronize the budget and policy planning processes so that government spending flowed more reliably to where it was most needed. With less than a year until elections that were widely expected to bring in new leadership, Auštrevi?ius and Šemeta implemented reforms that put Lithuania back on track in negotiations to join the EU and back on its feet financially. Successive governments led by Lithuania’s other major political parties helped sustain and institutionalize the early gains.

Jonathan (Yoni) Friedman drafted this case study based on interviews conducted in Vilnius, Lithuania, during January and February 2012. Case published June 2012.  A separate case study, “Focusing on Priority Goals: Strategic Planning in Lithuania, 2000-2004,” deals with the initial implementation of the strategic planning system in Lithuania.

Associated Interview(s):  Giedrius Kazakevicius, Kestutis Rekerta