Reforms in SSA livestock services: Basic principles

7. Animal health care services can be classified as private or public goods, depending on who receives the benefits (Leonard, 1984). At one extreme are purely private goods, which (i) only benefit the animal owner receiving the service: (ii) can be enjoyed exclusively by that owner (the exclusion principle): and (iii) when provided, exclude somebody else from that service at that particular time (the rival principle). For example, clinical treatment for a wound or worms would qualify as a pure private good because (i) the treatment benefits only the owner of that animal; (ii) nobody else benefits; and (iii) the treatment excludes other farmers from the services of the veterinarian at that time. In contrast, services like quarantine and meat inspection are pure public goods as they do not directly benefit the owner of the animal and do not exclude other producers from that service.

8. As a general rule, the higher the private benefit, the more justified it is to have the beneficiary pay for the service directly and to transfer the service to the private sector. Public sector management of private good services is justified if economies of scale are an important consideration or if sophisticated expertise or equipment is needed. In such cases, the services should be financed through direct payment from the beneficiaries and not from general revenue. Pure public good services should be managed by the public sector (although subcontracting to private operators is always possible) and financed by the general public revenue. Activities such as meat inspection approximate a purely public service and should therefore be financed and managed by public resources. The principal animal health tasks in SSA and their degree of public/private interest are listed in Table 1.

Table 1. Management and funding of common livestock services

		Management		Payment
		Private	Public	Beneficiaries	Treasury
Drug distribution		++	-	++	-
Clinical interventions		++	-	++	-
AI - semen production		++	+	++	-
AI - insemination		++	-	++	-
Dips		++	+	++	-
Vaccinations
	Compulsory	-	++	+	++
	Voluntary	++	+	++	-
	FMD a	-	++	+	++
Tsetse control		-	++	+	++
Diagnostic support		+	++	+	+
Veterinary surveillance		+	++	-	++
Veterinary research		+	++	+	++
Quarantine		-	++	+	++
Drug quality control		-	++	-	++
Food hygiene/inspection		-	++	-	++
Policy/planning		-	++	-	++
Extension		+	++	+	++

++ Obligatory or highly justified
+ Possible
- Not justified or undesirable because of potential conflict of interest situations.
^a Foot and mouth disease vaccination in meat-exporting countries; in other countries, it is considered mostly private.

9. The reforms most widely adopted in animal health care in SSA since the early 1980s fall into the following categories:

(i) increase in the degree of cast recovery for veterinary drugs, vaccinations,, other inputs, and veterinary interventions;

(ii) reorganization of public services to correct the imbalance between staff and operating means and to strengthen these services in animal health control, policy planning, and livestock research and extension;

(iii) liberalization of veterinary drug import and distribution; and

(iv) transfer of responsibility for animal health care to private veterinarians, middle-level technicians, specially trained herder representatives (auxiliaries), and even directly to the herders.

10. The basic objective behind all four reforms was - and still is - to create, through cost recovery and liberalization, the appropriate environment for the private sector to take over some of the veterinary tasks formerly carried out as public services once the government has delegated the "privatizable" veterinary tasks to the private sector, it can concentrate and improve on those tasks that need to remain in the public domain. To ensure that public agencies can carry out these tasks effectively, the reform package includes institutional adjustments that provide for adequate and continuous funding for their operations.