MTBPS: Godongwana downplays NHI funding concerns, emphasises infrastructure upgrades
Finance Minister Enoch Godongwana has reassured stakeholders about the government’s commitment to preparing for the National Health Insurance (NHI) rollout, despite a lack of direct funding allocations for its implementation over the next three years.
Godongwana’s remarks come amid scrutiny of the NHI framework and growing discontent among the business community regarding its implementation and consultation processes.
According to the 2024 Medium-Term Budget Policy Statement (MTBPS) documents, the health sector will continue to enhance health infrastructure through sustained allocations in direct and indirect infrastructure grants in preparation for the implementation of the NHI.
However, major funding shifts are not expected in the 2025 medium-term expenditure framework period as the focus will be on developing systems and mechanisms that support this reform, as outlined in the NHI Act of 2023.
Briefing the media before tabling the 2024 MTBPS in Parliament yesterday, Godongwana said there were a number of things which they thought were low-hanging fruits that should be done when he tabled the Budget Review in February.
“The infrastructure needs to be upgraded. Even if there was no NHI, we were still going to do that infrastructure. Digitalization of the records, which is quite critical. I mean, the medico-legal cases we have in provinces would not be holding as they do if we had proper records in hospitals and provinces,” Godongwana said.
“So we highlighted at the beginning of the year a number of issues, which we think should be a priority. And, again, also to focus on primary healthcare. A key success of the NHI is this trend in primary healthcare. So a lot of these things we're having a discussion with the Department of Health on how to roll out. Obviously, there will be differences between ourselves, but that's the engagement we're having with the Department of Health.”
In July, the Pretoria High Court declared sections 36 to 40 of the National Health Act 61 of 2003 unconstitutional.
The NHI Act, which was signed into law on the eve of the May 29 General Election, has courted controversy and not won support of the big business community.
Currently, the health sector is focused on delivering consistent services amid budgetary constraints and fears of freezing posts and job cuts.
Treasury said that during 2025/26, the sector will focus on improving efficiency by implementing the recommendations of spending reviews and introducing innovative solutions like the central chronic medicine dispensing and distribution system.
This will allow resources to be redirected towards quality improvement programmes like the ideal clinic and ideal hospital initiatives, as well as improving access to healthcare services.
Jurgen Eckmann, a wealth manager at Consult by Momentum, said the NHI, together with the public sector wage bill and the Social Relief of Distress grant remained hot potatoes for the government.
Eckmann said the government was under political pressure to deliver the NHI.
“Yet, as highlighted by the Finance Minister, tax revenue collection remains a pain point,” he said.
“This is likely partly why these aspects were skimmed over in the Finance Minister’s speech - except for the Minister indicating that expenditure for this year will increase for the SRD grants when compared to the February estimates, and that digitisation of health records to support the roll-out of the NHI would be a priority.”
BUSINESS REPORT