The Treasury’s latest iteration of the Budget, tabled by Finance Minister Enoch Godongwana yesterday, reduces the provisional additional allocations to Health’s baseline announced in March, but the cuts will not affect plans to hire 800 unemployed doctors and other healthcare professionals.
Additionally, section 16 of the Public Finance Management Act, which allows the Treasury to make allocations outside its usual Budget process, might be a considered option for extra funding for the Health Department.
This comes on the heels of requests from the department for additional funding and the SA Medical Research Council (MRC) to plug the gaping hole left by the Trump administration’s cuts.
This includes a R1.3bn budget request from the Health Department, which Business Day understands includes a plan for each province.
“We will need to decide how to process it – either through section 16 emergency allocations or through new allocations,” said the Treasury’s chief Director for Health and Social Development, Mark Blecher.
Section 16 of the Public Finance Management Act allows for allocations outside the usual Budget process, as happened during the Covid-19 pandemic.
It was not immediately clear why the request to the Treasury, made earlier this week, is so much lower than the amount the Health Department would have expected from Pepfar for the current fiscal year, which in February, Health Minister Aaron Motsoaledi had told Parliament, stood at R6.3bn for the 2025/26 fiscal year.
Savings on salaries might be an option, Godongwana had intimated, as Pepfar rates were higher than those set by the Public Service & Administration Department.
His presentation showed that in the 2023/24 fiscal year, R4.64bn of the total R7.5bn Pepfar funding went on the salaries of 200 staff in the national Health Department and 15 154 in the provinces.
SA’s top universities and research organisations have also been devastated by the US cancellation of hundreds of grants, and although two large donors had offered to support the MRC and universities affected by the cuts, they were asking the government to cough up co-funding.
Business Day previously reported that the MRC had increased its initial request for emergency funding from R150m to R400m after the potential donors indicated they were willing to help.
It has been co-ordinating the response from the biomedical research sector and is also involved in an assessment of the impact of Trump’s cuts to the broader science system recently established by Science & Innovation Minister Blade Nzimande.
Blecher said the Treasury was considering the submissions from the Health Department and the MRC and would make a final decision “in the period ahead”.
A total of R8.2bn has been trimmed from the R28.9bn provisional additional allocation for health announced in March, which now falls to about R20.8bn. The money is provisional because it is contingent on provinces meeting certain targets.
The portion set aside for hiring extra staff remained unchanged.
Consolidated health expenditure increases from a revised estimate of R277.2bn in 2024/25 to R296.1bn in 2025/26. It then rises to R310.7bn in 2026/27 and R325.8bn in the outer year. This provides an average growth rate of 5.5% over the medium term, compared with the Treasury’s projected 4.4% increase in inflation over the period.
See more from MedicalBrief archives:
Donors commit emergency funding as 100 researchers lose jobs
No extra funding in Budget for Pepfar gaps