Health system boosted to respond to COVID-19

Health system boosted to respond to COVID-19

Government will in the next financial year avail an additional R8 billion to the health system for the country’s COVID-19 pandemic response.

This will be in addition to the R20 billion the state allocated in the 2020/21 financial year, Finance Minister Tito Mboweni said on Wednesday, while delivering the 2021 Budget Speech, in Parliament.

In a Budget Review document, the National Treasury said the funds were to enable the sector to expand prevention, screening, testing and hospital capacity.

The R8 billion, which will be allocated to provincial health departments through the provincial equitable share, is expected to enable the sector to sustain these activities and respond to possible future waves of COVID-19 infection.

“Provincial governments receive an additional R8 billion in 2021/22 to continue the public health response to the pandemic, and the potential for additional waves of infection. Provinces can mitigate the negative impact of COVID-19 and the associated lockdowns on their revenues by improving efficiency, particularly in the procurement of health equipment,” said the Minister.

In total, the health expenditure function will over the medium term make up 14.2 percent of total government spending, declining from R247 billion in 2020/21 to R245 billion in 2023/24.

“Provincial health departments receive about 92 percent (R678.7 billion) of these medium-term allocations.

Reductions to the sector, mostly focused on compensation spending, are estimated at about R50.3 billion over the 2021 MTEF period,” the document reads.

To achieve this, other reductions would be required from health departments to increase efficiency. This included generating savings through centralised procurement of certain goods, reducing variations in unit costs in HIV programmes and improving management of overtime costs.

The COVID-19 pandemic has had a massive impact on the South African health system. As at 16 February 2021, the country had 1.5 million confirmed cases and over 137 000 excess deaths as reported by the South African Medical Research Council.

Over the MTEF period, R29.4 million is allocated to Tygerberg Regional Hospital and R100 million to Klipfontein Regional Hospital in the Western Cape through the health facility revitalisation grant.

VAT panel to report in June on zero-rated food

Finance Minister Nhlanhla Nene says the panel that has been established to review a list off zero-rated food products will submit its report next month. 

The Minister said this when he tabled the Treasury’s Budget Vote at the National Assembly on 22 May 2018.

As part of measures to address a budget shortfall, the National Treasury announced an increase in value-added tax (VAT) from 14% to 15% in February, which took effect in May.

We have established an independent panel of experts to review the list of 19 zero-rated food products and consider how best for government to mitigate the impact of the VAT increase on poor and indigent households.

I have also requested the Panel to consider whether key poverty-alleviating expenditure programmes like the School Nutrition Programme might be better at supporting the vulnerable.

The Panel is expected to submit an initial set of proposals to me by the end of June this year.

Nene said the National Treasury will continue to engage all relevant stakeholders to ensure that the VAT increase will not have an adverse impact on poor and indigent households.

The Minister said, meanwhile, that with tax revenue collections outlook remaining the same, any tax revenue collection agency must, like Caesar’s wife, be above suspicion.

The next major step therefore towards strengthening public finances is to restore public confidence in the SA Revenue Service.

In this regard, President [Cyril] Ramaphosa is finalising the appointment of the Commission of Inquiry into SARS.

Provinces slow to prioritise NCDs

imagesOnly 3 provinces have draft (not officially approved) NCDs plans and none have a budgetary allocation that can be traced to NCDs. Assessing the extent of NCDs roll out is difficult as neither budgets nor monitoring mechanisms are available. The three provinces are Gauteng, KwaZulu-Natal and Mpumalanga (see Table 1).

No province meets the all of the criteria for an operational NCDs plan:

  • NGOs & PLWNCDs engaged in national NCD plan development
  • Provincial budgetary allocation for prevention and treatment
  • Intersectoral NCDs mechanism including NGOs, PLWNCDs and private sector
  • NCDs plan with a ‘whole of government’ approach, i.e. with areas for action beyond the health sector.

NCDs plans could be standardised if a template existed and that could easily be one of the first tasks of the long delayed NCDs Commission / National Health Commission.

Discouraged NCDs personnel in provinces

Dedicated health officials from the provincial heath head offices work on NCDs despite the low priority given by leaders to fight NCDs. One such worker recently said: “I have been told there is no budget for NCDs health promotion in our province for the rest of the financial year. What am I supposed to do for the next 5 months? It is very discouraging.”

Table 1:  NCDs plans available and operational in provinces

Eastern Cape: Unknown No web-based documentation found and no response to request for NCDs plan.
Free State Unknown No web-based documentation found and no response to request for NCDs plan.
Gauteng: Partial Completed draft NCDs operational plan that is combined with geriatrics and eye care. (26) Goals, targeted and with budget request. Intersectoral objectives with meetings and district coordinators already take place. Availability of plan not known.
KwaZulu-Natal Partial Completed draft NCDs plan used to guide activities which presented at the intersectoral KZN–SA NCD Alliance Indaba (workshop) in June 2014.(27). However, support is implied by the attendance of the Member of the Executive Committee (MEC) for Health at the NCDs meeting. (28)
Limpopo: unknown No web-based documentation found and no response to request for NCDs plan.
Mpumalanga partial Completed draft NCDs Operational Plan 2014 (29)
North West unknown No web-based documentation found and no response to request for NCDs plan.
Northern Cape unknown No web-based documentation found and no response to request for NCDs plan.
Western Cape partial Plan under construction. (30)

Source: SA NCD Alliance Benchmarking NCDs for action 2015.  Full list of references in benchmarking document (all are all provincial government documents.)

Alcohol tax discussion paper by National Treasury

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Written comments by 30 June 2014 to Riaan Labuschagne

The proposals in the discussion paper are part of a package of measures (financial and non-financial) aimed at addressing the negative externalities associated with alcohol and encouraging a more responsible approach to the use of alcohol. Such measures include excise duties on alcoholic beverages, limits on the drinking age, restrictions on liquor trading hours, restrictions on alcohol advertising, education targeted at the youth and other groups at risk (e.g. pregnant women), better enforcement of laws and regulations to combat alcohol abuse and illicit trade, and higher penalties for drinking and driving.

Download the full document here: Alcohol tax discussion paper by National Treasury – make a comment

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