Date: 13/04/2010
Source: Democratic Alliance
Title: DA: Waters: Speech by the Democratic Alliance shadow minister of health, in the debate on the health budget, National Assembly

Speaker,

Health care, or the lack of it, is a matter of life and death.

For too long the vast majority of South Africans have been subjected to declining quality of health care, longer queues and ever increasing waiting lists for treatments and operations. Without sound financial management it is impossible to provide basic health care on a day to day basis, let alone project what amount will be needed in following years.

There is an urgent need for an improved financial management process within the South African public health sector. Expenditure in many provincial health departments is currently inefficient and ineffective. These Provincial departments and the National Department in general do not have the ability to:

Undertake a comprehensive budgeting process
Reliably project expenditure
Manage and control expenditure
Evaluate cost-effectiveness

This lack of capacity has resulted in:

Significant over expenditure in key areas

An inability to adequately determine clear cost drivers and the causes of over expenditure
A lack of strategic planning with clear objectives when additional funds are required.
Inefficient expenditure and losses with audit queries

In a reply to a parliamentary reply, the nine provincial health departments had as of 31 December 2009 an estimated budget deficit of R5.7 Billion, which is more than double that of the previous financial year. This may not reflect the severity of the situation as economists predict that a probable R6 - 7 billion has been deferred to the 2010/11 financial year.

This Speaker reflects a massive funding gap and it is uncertain as to how exactly the Department and Treasury plans to address this huge shortfall.

It appears that the unannounced strategy is to part fund the shortfall indirectly by clawing back R2 billion through below inflation remuneration increases. Given, however, that a minimum of R7 billion is needed to deal with the Occupational Specific Dispensation (OSD), this will still leave a R5 billion shortfall.

The DA concern is that this has not been made explicit and most of the provinces and Treasury are hiding the real health deficit.

So what has caused the funding crisis? Due to the lack of skills within the department and a hopelessly outdated persal system, the cost of OSD was grossly underestimated, as the Department did not know how many nurses it had, with what skills and on what level they were employed at.

While the OSD underestimation exacerbated the financial crisis in health care, this was in fact the final straw that broke the back of what is, for the most part, a shambolic and disgraceful administration of health care. 

The reason for this crisis lies in the inept management which prevails in most provincial health departments.

Auditor-General's reports for most provincial health departments comprise long lists of reports on wasteful expenditure, expenditure that cannot be accounted for, assets which have vanished, debts which have not been paid, duplicate payments, lack of sufficient controls, staff who cannot be found - ghost workers, performance payments that cannot be justified, payment for goods and services which were not received, and on and on.

For the past five years in a row, the national health department has received qualified auditor-general's reports largely because it has not been able to obtain quarterly performance reports from many provinces.

Despite all this, Minister there has been no accountability with regards to financial management or mismanagement. Unless there are consequences for mismanagement the current unacceptable and unsustainable situation will continue. We need to know in addition to the overspend, how much has been deferred to the 2010/11 financial year?

In order to rectify the situation, the DA would like to make the following proposals:

Firstly, effective Budget Management requires active strategic leadership from the Head of Department (HOD) as Accounting Officer (AO) and the Chief Financial Officer (CFO) who provides support to the AO.

Since there may be different levels of commitment and capacity in the provinces, it is necessary to assist the HOD with guidance and where necessary instruction from the National Department of Health. 

It is key that these issues be a standing agenda items at report back sessions to the HOD's and when the Minister meets with the provincial MEC's for Health on a regular basis.

Secondly, financial leadership and management are required to develop and manage the process on a day-to-day basis. This requires in depth:

Data analysis skills;
Understanding of the information available from the transversal public service systems (BAS, PERSAL, LOGIS, MEDSAS);
Understanding of Budget Management;
Understanding of Health Finances;
Ability to interact with Health Managers;
Ability to understand the business of Health

The managers in the financial management component must be able to confidently communicate with and advise the CFOs and the HODs of the various departments on the financial status of their respective departments at all times.

Thirdly, due to the lack of budgeting and technical skills at institutional level as well as the inability to understand and interpret data, urgent training of line managers and financial staff in the districts and at health institutions is needed.

With the hopefully overall improved data and a better understanding of the data, health as a sector would be able to provide better motivations to National and Provincial Treasuries for funding. With such skills the health sector would also be able to accurately determine:

Whether the sector is adequately funded for new policy mandates;
Needs, by comparing current staffing and funding levels to accepted norms;
The cost of proposals with detailed supporting documents for submission to National and Provincial Treasuries.
The levels of funding of various provinces, compared to patient numbers.

Speaker we heard today from the Minister the 10 priorities of the Department, of which the DA supports most.

These priorities were also mentioned in last year's budget, and we hope that this year will be the year of action as far as meeting targets in child and maternal mortality rates for example.

We welcome the u-turn in the fight against HIV/AIDS and the DA supports the campaign of encouraging people to get tested and know their status with regard to prevention.

While South Africa currently offers a universal health cover, the quality of health care in the public sector is of great concern to the DA.

One driving factor of poor quality of health care is the chronic lack of medical professionals.

In a reply to a parliamentary question, the number of doctors qualifying in South Africa actually fell between 2004 and 2008, from 1 394 to 1 306, despite our country's desperate need for more doctors.

Put together with the fact that about 17% of doctors leave South Africa after they have qualified; South Africa faces a grim scenario in terms of improving its health system.
The drop in graduates was largely the result of a decline in output at universities in provinces where the need for doctors is most acute - Limpopo, the Eastern Cape (Walter Sisulu University) and the Free State.

At the University of Limpopo, for example, the number of graduates fell by more than a third, from 238 to 150.

One solution is to bring in the private health sector to assist particularly with the practical side of training.

The lack of nurses is another concern and if it were not for the private sector that now produces about 52% of all new nurses, our health system would be on its knees. We hear year after year that the nursing colleges that were closed by this government are to be opened but not one as yet has. Given the fact that we need to produce tens and tens of thousands of nurses one would have expected the government to act in a urgent manner given the severity of the crisis.

Our human resources plan is basically nonexistent and the old plan is based on questionable figures and deliberately excluded the private sector. We urgently need a new plan that is based on accurate figures of how many nurses and doctors are actually working in South Africa and how as a country we can effectively optimise all available resources to increase our work force.

The unacceptable levels of maternal mortality need urgent attention. One of the driving factors, but not the only one by any stretch of the imagination, is that mothers are deterred from attending antenatal and postnatal clinics due to the fact that they have to wait in long queues for the entire day before they are seen to. It is high time that scheduling of appointments is implemented at all antenatal clinics. This will allow a woman to arrive say half an hour before her appointment and not waste her entire day when she could be doing other things.

Speaker if we are to improve the quality of health care for all the people, we must start moving to a health system that allows choice - open opportunity - such as allowing patients to choose a pharmacy of their choice to collect their repeat prescriptions instead of travelling long distances to their hospital only to find the queue snaking out the door, having to wait in the queue all day and sometimes not even being able to collect their medication due to stock outs.

There are many innovative measures that can be put in place that will improve the quality of health care without increasing the cost of health care, we need to, as a matter of urgency, investigate all these possibilities to improve the quality of health care for the vast majority of our people.