Budget adjustments highlight crisis at Gauteng Health

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The crisis at Gauteng Health took centre stage in the provincial budget adjustments‚ with the MEC warning that the department was not out of the woods yet.

The Times reports that the Health Department received the biggest budget adjustment of R1.23bn in the Gauteng Medium Term Budget Policy Statement presented in the legislature. This was to help the department deal with its spending pressures on goods‚ services and personnel.

The report says that Gauteng premier David Makhura has also established a committee to deal with the financial situation in the department which has a turn-around strategy focusing on effective human resources‚ health operations management‚ medical and legal risk management and improving cooperative governance.

“What we all understand is that they (the department) are facing significant accruals from the previous financial year. The issue that we have to be concerned about is why are they facing those accruals. I would argue that part of it is this disjuncture between the rate of the migration within the province and the growth in equitable share‚” Finance MEC Barbara Creecy is quoted in the report as saying.

“But we have also got to accept that there are significant problems with the managerial capacity in the department of health. We had a situation at the end of last year and the beginning of this year where the financial controls in that department broke down. The consequence of that is that people are spending money that they don’t have.”

She said one of the problems in the department is that they could not give provincial treasury the exact number of the accruals and what they were for. Creecy added that Makhura’s intervention should not be seen as a quick-fix but as an institution building exercise.

The report says at the end of October‚ provincial Treasury went through the accruals and was able to start paying businesses that have provided services to the department. “At the end of October‚ we were able to pay 1‚721 service providers whose invoices were less than R5m. We spent there R416m … What we are now working on is a payment plan till the end of the year‚” Creecy said.

“We are prioritising the National Health Laboratories‚ the SA National Blood Services because these are two important institutions that are owed a significant amount of money by the Gauteng Department of Health. These are institutions that serve the whole country. Gauteng Health can’t be responsible for undermining the health of these two important institutions.

“But I would not want to pretend that we are out of the woods yet. I would like to say that an intervention committee can only do so much. What I’m calling for today is how do we ensure that all health managers in all health institutions are aware of what their budgets are and are spending according to those budgets.”

Creecy added that Health MEC Gwen Ramokgopa had taken a decision to decentralise financial authority to hospital managers.

The Times report

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