Government will be "relentless" in implementing National Health Insurance (NHI), but the scheme may not necessarily mean higher taxes, Finance Minister Pravin Gordhan said on Wednesday.

He was speaking to journalists ahead of the tabling of a Medium-Term Budget Policy Statement detailing how government spending on health will grow to over R127-billion by 2013.

Gordhan said government was absolutely committed to developing a health system that served all 50-million South Africans.

"Over a period of 14 years that the NHI document currently reflects there will be a relentless and systematic approach to implementing the national health insurance," he said.

"How are we going to fund it?

"One of the key issues we are working on is how do we stop this wastage in the health system and how do we stop provinces from diverting funds that are meant for health... to other so-called needs."

He said that at present "nobody quite knows" how much NHI would cost.

"Are taxes going to increase? We are going to say no, not yet. Until we know exactly what the numbers look like, what the costs are, to see what cash flows is required per year over a five, ten, 15 year period, I think it will be unfair to say, South Africans your taxes going to increase."

It was possible that some of the commitments required for NHI could be met by a widening tax base, Gordhan said.

The policy statement that he tabled detailed an increase in the current financial year's health budget to R101,9-billion.

The medium-term spending figure set in February's Budget for 2011/12 of R109,7-billion would grow by R3,1-billion, while the 2012/13 projection of R116,6-billion is to rise by R4,7-billion.

In 2013/14, consolidated health spending will total R127,1-billion.

The figures appear to fall short of estimates released by the African National Congress at its national general council meeting last month.

The party said then that preliminary estimates by a ministerial advisory committee indicated that resources needed for NHI "increase from R128-billion in 2012, to R 267-billion in 2020, and R376-billion in 2025".

Experts have differed on the affordability of the scheme, with consultancy Econometrix warning last week that it would require that the South African economy grow by an "improbable" seven percent a year.

Wednesday's budget statement said the groundwork was already being laid for the scheme.

It said changes had already been made to the equitable share formula, which governs distribution of cash to provinces.

This made provision for a "more specific and detailed health component", with subcomponents for primary health care and hospitals.

"Amendments to improve the fairness of the tax treatment of medical scheme constitutions will be introduced," it said.

Consideration was being given to ways of piloting improved family health care as part of an enhanced primary care system, including district-based contracts with general practitioners.

Options had to be explored for "aligning" medicine procurement to make the most of economies of scale from bulk purchases.

The statement said there was potential for private hospital participation in training doctors and nurses in conjunction with academic institutions, and for bringing private sector management capacity into public health delivery.

The African National Congress said last month that NHI would kick off in the rural areas and would be staggered over three phases, starting in 2012.