In 2017/18, the Government of Tanzania introduced the Direct Health Facility Financing (DHFF), which has been one of the country’s most transformative reforms, as it involves direct transfer of funds from the Ministry of Finance (MOF) and health insurance agencies to health facility’s bank accounts. Under DHFF, health facilities are granted autonomy to plan, budget and spend based on their local needs. Prior to DHFF, funds were transferred to district health managers who would plan and budget on behalf of all surrounding facilities. Tanzania also decided to modernize its public financial management (PFM) and health financing systems alongside DHFF implementation, by optimizing the use of digital tools to enhance efficiency, transparency, and accountability. The ultimate aim of these refoms is to ensure that resources for health reach facilities on time, are spent as planned, and deliver services in response to population needs.

Tanzania Mainland has 26 administrative regions and 184 councils responsible for managing local health services under a decentralized governance system overseen by the President’s Office – Regional Administration and Local Government (PORALG). PORALG ensures compliance with financial regulations and oversees the DHFF implementation, while the Ministry of Health (MOH) ensures alignment with health policy priorities, and Council Health Management Teams (CHMTs) coordinate bottom-up planning, budgeting, and supervision in using digital systems. This arrangement enhances transparency, data use, and accountability.

Previously, fund flows in Tanzania’s health sector were inefficient, wasted, lacked transparency, and bureaucratic with resources passing through multiple administrative layers before reaching facilities. This led to frequent delays, not meeting the facility needs, and limited visibility on resource flows for accountability. Planning and reporting were paper-based at facility level, prone to errors, wastage, and difficult to aggregate to higher level. Thus, Tanzania introduced digital platforms to strengthen transparency, accountability, and PFM processes from planning to execution.

In Tanzania’s PFM system, especially in the health sector, PlanRep and FFARS are the two key digital systems that support planning, budgeting, spending and financial reporting at council and facility levels. These systems are also vital to ensure transparency and accountability of funds channelled directly to facilities via DHFF.

PlanRep is web-based platform through a virtual private network (VPN) and internet with encryption to connect users to the central server. Council is the primary user of PlanRep, a digital system that was introduced alongside DHFF. It is used specifically by the district health managers and planning officers to allocate and amend budget ceilings for each facility at the start and during the planning and budgeting process. Facility plans and budgets are entered into PlanRep at facility level (if capable to do so) or council level, while helping to track budget and expenditure allocations. Plans and budgets are then consolidated at council level as Comprehensive Council Health Plans (CCHPs).

Through PlanRep, health facilities can prepare plans aligned with CCHP guideline and budget ceilings. PlanRep system standardizes planning elements, ensuring that data from thousands of health facilities can be aggregated easily. Once approved, facility and council plans are integrated into the national budget framework and linked with the Integrated Financial Management Information System (IFMIS) at MOF.

PlanRep has made local planning more evidence-based, transparent, and participatory, as frontline providers can now directly input their priorities, link them to budget lines, and report performance using the same platform.

FFARS is a web-based accounting system introduced alongside DHFF reform and complements the PlanRep system. It operates on mobile devices using the android application system and through a web application, and currently operational in all public facilities in Tanzania. FFARS allows health facilities to record, track, and report all financial transactions in real time, including revenues from government transfers, user fees, insurance reimbursements, and donations. It allows budget execution only for initially planned items and activities.

Under DHFF, FFARS ensures that every shilling is accounted for since facilities are using FFARS to record expenditures by activity and generate automatic monthly, quarterly, and annual financial reports. These reports feed back to councils and the national level, enabling continuous oversight by PORALG and Ministry of Health. FFARS has dramatically improved financial transparency and audit readiness. Data from FFARS are also used to monitor fund utilization, absorption rates, and compliance with financial guidelines, creating a virtuous cycle of accountability and learning.

Beyond PlanRep and FFARS, Tanzania has several complementary digital systems for PFM and health financing system. Local Government Revenue Collection Information System (LGRCIS) helps councils to track revenues, reduce leakages, and strengthen fiscal autonomy. Government of Tanzania Hospital Management Information System (GoTHoMIS) integrates clinical, pharmaceutical, and financial data; linking service delivery with user fee collections and connects with FFARS, though its rollout to lower-level facilities remains incomplete. Epicor IFMIS supports national budget execution and expenditure control, ensuring facility spending stays within approved ceilings, while the Government e-Payment Gateway (GePG) digitizes all government payments and receipts, facilitating secure electronic transactions to and from health facilities.

In terms of integration and interoperability, plans and budgets in PlanRep are uploaded into FFARS for facility-level financial execution, while expenditure data from FFARS feed back into PlanRep and the Local Government Monitoring Database (LGMD) for performance reporting. Both link to Epicor IFMIS for budget control and the Bank of Tanzania’s payment system for fund transfers. This integration enhances data consistency, reduces duplication, and improves real-time tracking of public fund flows from the national budget to service delivery points.

Tanzania’s experience provides valuable lessons for other low- and middle-income countries pursuing digital transformation in PFM and health financing. The country’s integrated digital systems across the entire PFM cycle leads to smart accountability ecosystem that enhances efficiency, transparency, and trust in public institutions. DHFF reform demonstrated how digital tools can translate policy ambitions into tangible results by improving timeliness of fund flows, accountability in spending, and data availability for decision-making. As Tanzania plan to implement the Universal Health Insurance (UHI), existing digital systems will remain vital for timely reimbursements, planning and budgeting using UHI funds, tracking expenditure of UHI funds, and linking reimbursements to results. Continued investment in infrastructure, interoperability, and ICT capacity remains crucial to fully unlock the potential of these digital innovations in Tanzania.

The author can be reached by email at pbinyaruka@ihi.or.tz