HEALTH: Squeeze on nurses, doctors

The amount of money allocated for doctors and nurses’ salaries will increase by a paltry 1.1% on average for each of the next three years, limiting the number of practitioners that can be hired by provincial hospitals and clinics.

The National Treasury says in the Budget Review that it plans to only marginally hike the budget for medical staff compensation, which already uses up 62.5% of provincial health budgets. This will limit "the ability of provincial health departments to employ frontline staff", it says.

It’s a surprising move at a time when, thanks to the pandemic, there has been an unprecedented focus on how severely short-staffed government hospitals are.

On top of the bad news, the R259bn allocated to the 2022 health budget represents a scant 0.2% overall increase. In real terms, this amounts to an effective decrease in funds set aside for health care when inflation and population growth are factored in.

Of course, any bid to curb the pay of nurses and doctors depends on whether the Treasury is successful in limiting wage hikes for public servants — something it hasn’t managed to do. Questioned by journalists this week on whether the promise to cut the wage bill will happen, finance minister Enoch Godongwana was evasive. He said he preferred to call it "wage restructuring", but gave no concrete ideas on how any such restructuring could happen.

There was, however, some good news for the health-care sector. Thanks to the extra R181.9bn the Treasury managed to collect in taxes, largely due to a boom in commodity prices, it was able to throw the department of health a one-off R21bn lifeline over the medium term.

Most of this — R15.6bn over the next three years — will go to the provinces, which typically run out of money for medicines and other medical equipment due to what the government describes as "spending pressures".

The extra cash given to the department will also help foot the bill for medical students trained in Cuba, who must now spend a year interning in state hospitals and do two years of community service to complete their qualifications. Over the next three years, R3.2bn is allocated to pay the salaries of these medical students.

Some years ago, former health minister Aaron Motsoaledi publicised his plan to train hundreds of extra doctors in Cuba with pride. However, it has become an expensive headache for the government to place an extra 800 medical students in internship and community service jobs each year. Whether the Treasury will continue to fund this Cuban programme remains to be seen.

As Godongwana put it, you can’t fund permanent programmes using revenues that are temporary in nature, such as this year’s windfall from the mining companies.

This suggests that he would be reluctant to provide cash for the long-term state employment of the Cuba-trained doctors, once they’re fully qualified.

If so, Motsoaledi’s plans to bulk up government clinics with extra doctors may die.

There is more money for Covid vaccines, however. Last year, R7bn was spent on this, and the Treasury has now allocated a further R2.2bn to buy more — though R1.3bn of this is described as "provisional".

This reflects the lack of clarity over how much more demand there is for the vaccines. Nonetheless, the Treasury is optimistic in its budget documents, hoping that 70% of adults will be vaccinated by March. This seems wildly ambitious, given that by February, only 42% of SA adults had been vaccinated.

While vaccination remains a cornerstone of plans to open up the economy after Covid, it is something of a surprise that the SA Medical Research Council (SAMRC), which did much to advance the cause of vaccines in SA, faces budget cuts over the medium term.

Not only did the council pilot vaccine trials in doctors and nurses, SAMRC head prof Glenda Gray negotiated vaccine trial doses from pharmaceutical giant Johnson & Johnson to ensure that health-care workers were protected before the third Covid wave struck SA.

Even so, the SAMRC’s funding will decrease from R1.5bn in 2021 to R1.34bn this year.

Gray tells the FM that actually, "the Treasury has tried to protect our funding". But she says the baseline budget for the council decreased by nearly 10%, from R851m to R779m. "Obviously we would like much more, as our money goes a long way and there is great need for medical research in the country," she says.

National Health Insurance (NHI), the much-delayed plan for a state-controlled financing pool for health care, gets only a passing mention in the budget.

Experts have criticised the cost of such a plan as too exorbitant to implement at a time when SA’s finances are tenuous.

In the budget, NHI programmes get R8.8bn over three years — but much of this is for ordinary health-care spending, rather than for plans linked to a new NHI fund. The money will go towards improving hospital infrastructure and existing programmes that deliver chronic medicines by couriers.

If anything, it appears as if NHI plans are going backwards, given that money set aside for mental health programmes and cancer staff has now been shifted from the national department to the provinces.

There is also some small tax relief for medical aid members as the medical aid tax credit gets its first increase in a few years, from R322 to R347 per month for main members and R224 to R234 per month for additional members.

Elsewhere, the Treasury warns that vaping could be taxed from 2023, while the tax on sugary drinks will increase marginally for the first time since it was implemented.

This tax will rise from 2.21c to 2.31c, which implies the cost of a can of sugary drink could increase by a few cents.