Wednesday, 17 April, 2024
HomeNews UpdateNo new funding for NHI in medium term budget statement

No new funding for NHI in medium term budget statement

Finance Minister Enoch Godongwana made no mention of additional funding for the National Health Insurance in his Medium Term Budget Policy Statement yesterday.

But a News24 report says money will be shifted from the existing NHI grant to cover oncology services.

“If the National Health Insurance policy is implemented, then spending on public health could increase from about 4% of GDP in 2022/23 to 6% of GDP by 2040/41. This increase may require additional spending or revenue measures to ensure sustainability,” Treasury said in its statement.

Although spending for the health sector will increase (+3.1), it will be below inflation in keeping with the all-round belt-tightening announced by Godongwana.

BusinessLIVE explains that the consolidated health expenditure growth by a nominal 3.1%, fails to keep pace with the consumer price index (CPI). The Treasury estimates CPI will come in at 6% this year, and forecasts it will be 4.9% in 2024, 4.6% in 2025 and 4.5% in 2026.

In line with its directive to government departments to cut back on programmes that are underspending, R1bn has been shaved from the HIV/Aids conditional grant in 2023/2024. The HIV/Aids conditional grant is about R25bn a year, and is augmented by a further R10bn a year in donor funding. A further R445m has been cut from the health facilities infrastructure grant this year.

The Treasury has set aside a revised estimate of R264.5bn for health in 2023, rising to R268.4bn in 2024/2025. The consolidated health budget then increases to R277.6bn in 2025/2026 and R290bn in the outer year.

Maintaining service delivery amid budget constraints would require health to improve efficiency in areas such as overtime payments, medical supplies and security services, and to delay infrastructure projects, the Treasury said.

Funds for oncology services are to be shifted from the NHI grant to the National Tertiary Services grant, and a single grant is being proposed to consolidate the personal and non-personal services components of the NHI indirect grant. Indirect grants are managed by national departments on behalf of provinces.


News24 article – Medium-term budget in a nutshell: It’s going to hurt (Restricted access)

BusinessLIVE Treasury seeks to buffer front-line services from effect of wage deal

See more from MedicalBrief archives:


Proposed budget cuts disastrous for health sector, activists warn


No funding model yet, but NHI gets big chunk of health budget


Little relief for embattled health sector in 2023 budget





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