The governing African National Congress (ANC) has stuck to its guns about the controversial National Health Insurance (NHI) scheme and extending social security in South Africa, despite the pushback against these measures.
Delivering closing remarks at the ANC’s national executive committee meeting on Sunday (13 November), party president Cyril Ramaphosa said that the ANC would continue to tackle the ‘triple faultlines’ of poverty, unemployment and inequality in South Africa.
Stemming from days of engagement between key figureheads in the ruling party, the president said that the ANC has critically engaged with challenges facing the country today.
Exacerbated by the Russian war in Ukraine, economic aftershocks from the two-year pandemic and extreme weather events as a result of climate change, many countries across the world, including South Africa, are facing hardships as the cost of living day-to-day increases, said Ramaphosa.
To mitigate the impact of the rising cost of living, he said that the party led several interventions, many of which remain in place, such as:
- The Social Relief Distress grant is being extended until March 2024;
- Zero-rating VAT on key food items;
- Consolidating social grants to reach 18 million people.
Moving forward, without giving any specific plans, Ramaphosa said that the ANC will double down on its efforts to address the growing crisis by extending social grants where possible and focus on basic education and universal healthcare.
“We are committed to maintain and, to the extent possible, expand social security to protect the vulnerable and reduce poverty,” Ramaphosa said. “This must form part of our efforts to build a comprehensive social security system.”
The party emphasised its pursuit of the National Health Insurance scheme (NHI) and accelerated land redistribution – two of the most controversial policies in its current basket – while talking up black economic empowerment and clamping down on corruption.
Social relief distress grant
One of the more controversial developments is the extension and the increased applicability of the social relief distress grant.
During finance minister Enoch Godongwana’s latest Medium Term Budget Policy Statement in October, the Covid-19 Social Relief Distress (SRD) Grant was extended to the end of March 2024.
“The SRD grant was introduced in May 2020 as a temporary measure to respond to the needs of the most vulnerable, who were affected by [Covid-19 induced] lockdown measures. It has been extended several times since then. Discussions on the future of the grant are ongoing and involve very difficult trade-offs and financing decisions,” said Godognwana.
The National Treasury has found that the SRD grant will likely grow by roughly 8.8% annually, and the implications it could have on the state’s finances may reach R64.9 billion in the 2030/21 financial year.
Despite this fiscal drain, recent amendments to the grant have increased the income threshold for the means test from R350 to the food poverty line of R624 per month – allowing for more people to qualify, with up to R12 million now applying every month.
The Treasury has noted that this is unsustainable and economic growth through employment is a better bet to solve poverty in the country.
NHI
The national Department of Health, meanwhile, is forging ahead with setting up the groundwork for the eventual rollout of the NHI in South Africa, despite the laws regulating the scheme not yet being approved and many legal questions lingering.
While systems for sharing information between the private and public sectors are being put in place, and recruitment for key NHI positions are now allowed to continue, no one in government has yet been able to address the elephant in the room: how much is the scheme going to cost ?
The government’s push for the NHI comes amid a cacophony of warnings and dissenting voices, saying the scheme is unaffordable, unmanageable and unsustainable.
Private healthcare groups have been the most vocal on this front, saying the system is being set up for failure given the scale of what the government wants to achieve against the backdrop of how it has already failed in the public healthcare space.
There are also concerns over an exodus of healthcare professionals who refuse to be subject to the scheme’s harsh conditions, as evidenced by the court ruling the department is appealing.
Medical aids have been fighting for their continued existence, given that the NHI scheme envisions a healthcare system with the state entirely in control and little to no room for private healthcare funding.
Source : BusinessTech 11/14/2022