An Assessment of Financial Risk Management in Donor Funded Health Programmes: Evidence from the Ministry of Health in Zambia

Abstract

Donor funding remains a critical pillar of healthcare financing in developing economies, particularly in sub-Saharan Africa where domestic fiscal capacity is constrained. In Zambia, the Ministry of Health depends heavily on donor resources to finance essential health programmes, including disease control, infrastructure development, and service delivery. However, persistent audit findings continue to reveal weaknesses in financial management systems, including misallocation of funds, weak internal controls, limited transparency, and exposure to fraud and corruption. This study assesses the effectiveness of financial risk management practices in donor funded health programmes within the Ministry of Health in Zambia. The study adopts a mixed methods exploratory case study design, integrating qualitative thematic analysis with a structured analytical framework. Data was collected through semi structured interviews and document analysis. The findings reveal that weak internal controls, inadequate monitoring systems, and poor transparency mechanisms significantly increase the likelihood of financial misappropriation, while governance and accountability structures mitigate such risks. However, institutional weaknesses and enforcement gaps continue to limit effectiveness. The study contributes to public financial management literature and provides policy relevant recommendations for strengthening fiduciary risk management and improving accountability in Zambia’s health sector.