A document tabled in Parliament by Finance Minister Tito Mboweni reveals cuts to public health spending that were not elaborated upon in the Medium-Term Budget Policy Statement (MTBPS). A Business Day report says in a marked departure from prior years, the MTBPS does not spell out the changes to the conditional grants earmarked for health or indicate how the cuts have been prioritised.
They are, however, detailed in the Division of Revenue Second Amendment Bill. Health has historically been prioritised in the budget process, protected from the effects of inflation even when other sectors were squeezed. But this year, the MTBPS pencils in a consolidated health budget that grows by just 2.9% over the medium-term expenditure framework, a drop in real terms since the Treasury anticipates inflation for the period will fluctuate around 4.5%.
Casualties during the fiscal year include conditional grants for hospital infrastructure, training specialists and HIV and TB services, which will have an immediate effect on service delivery.
But there is also a huge cut to funding for National Health Insurance projects that has longer-term implications for the government’s ambitions for achieving universal health coverage. Health will also face huge cuts to its compensation Bill as part of the government’s plans to cut the public sector wage bill, but it is too soon to gauge how this will affect staff numbers.
The MTBPS proposes compensation for health sector employees be cut by R72.7bn by 2023/2024.
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