President and Minister of Health should reconsider NHI – AfriForum
Kallie Kriel |
26 May 2022
System will be unaffordable for the already over-burdened taxpayer
AfriForum criticizes NHI; urges President and Minister of Health to reconsider
26 May 2022
The civil rights organisation AfriForum today sent a letter to President Cyril Ramaphosa and the Minister of Health, dr. Joe Phaahla, requesting that the government reconsider the implementation of National Health Insurance (NHI). This follows after Phaahla recently confirmed that the country has a shortage of doctors and a doctor-to-patient ratio of 0.32 to 1 000.
AfriForum’s letter argues that NHI is unaffordable for the already over-burdened taxpayer, who is taxed higher than in other countries with comparable GDPs and forced to pay “double taxes” for essentialised private services such as healthcare. The civil rights organisation also argues that the centralised health fund will be susceptible to the exact same failures that have characterised nearly all State-Owned Entities (SOEs). Perhaps most worrying is a 2021 poll from the South African Medical Association pointing toward the mass-emigration of healthcare professionals in the event of the implementation of NHI.
As a solution AfriForum suggests that the government should begin by solving the pre-existing governance issues in the public health sector. Along with this AfriForum suggests further expanding and stimulating the private sector to ensure greater competition between medical aid providers, thus allowing the workings of the free market to drive down prices for purchasers.
“The recent confirmation by the minister of the severe shortages of doctors in South Africa, is just another example of why a state-monopoly health sector will be catastrophic. This letter is an attempt to achieve a constructive dialogue with the government vis-à-vis NHI. However, if the letter falls on deaf ears, AfriForum will continue to oppose the proposed legislation with all the means available to us. Our fight against NHI is one of the most important battles on which the very future of this country depends,” says Reiner Duvenage, Campaign Officer for strategy and content at AfriForum.
Add your voice to support AfriForum’s campaign against National Health Insurance.
Text of the letter:
26 May 2022
Mr. M.C. Ramaphosa Union Buildings Private Bag X1000 PRETORIA
CC: Dr M.J. Phaahla, MP
Minister of Health
Dr AB Xuma Building 1112 Voortrekker Road PRETORIA
Dear Mr President
AFRIFORUM’S STANCE ON NATIONAL HEALTH INSURANCE
In the light of the recent admission by the Minister of Health that there is a shortage of doctors and a doctor-to-patient ratio of 0,32 to 1 000, AfriForum is writing to express its deep and continued concern over the potential implementation of the National Health Insurance (NHI) Bill. We believe that this issue is central not only to the future of quality healthcare, but to the very existence of the country itself. Since we represent the interests of our 300 000 members and the broader public, we have participated at every opportunity afforded to us in the legislative process.
Solidarity Trade Union estimates that the implementation of the Bill will cause a R112 billion budget deficit that will have to be absorbed by the state. Due to the government’s significant debt levels, the deficit cannot be funded through loans. According to Solidarity, this leaves an income tax surcharge of 20%, a VAT increase from 15% to 20%, a payroll tax of 5,5%, an increase in corporate income tax from 28% to 42% or a combination of these as the only way to fund NHI. South Africa is already taxed higher compared to other countries in the same GDP bracket, and citizens must pay “double taxes” for many privatised essential services. Considering an estimated 20% of South Africans pay three-quarters of all income tax, NHI will be the final straw to break the taxpayer’s back.
Furthermore, the well-documented failure of state-owned entities (SOEs) and misuse of public funds inspire little confidence that the NHI fund will not be susceptible to similar problems. Lastly, the South African Medical Association warned in 2021 that 38% of its 12 000 members plan to emigrate if NHI were to be implemented, while 6% plan to emigrate due to other reasons and 17% indicated that they are unsure if they would leave the country if the government were to implement NHI. The mass exodus of these healthcare professionals will logically prove catastrophic. Against the background of the above, we argue that the implementation of NHI will destroy the healthcare industry in its entirety. The consequences of this will be unfathomably dire for the future of this country.
AfriForum recognises that reform is needed in the healthcare industry. However, our solution wholly differs from the NHI Bill’s approach of establishing a state monopoly over healthcare. The fact that the Western Cape Department of Health was the only health department to receive a clean audit in 2019/2020 shows that the government can begin to solve the healthcare conundrum by improving the prevailing poor standards of governance and administration in the public sector. In line with the recommendations of the National Health Market Inquiry of 2019, we further propose the expansion and stimulation of the private sector to ensure greater competition between medical aid providers, thus allowing the workings of the free market to drive down prices for purchasers. These are the only viable steps to ensure universal access to quality healthcare for all South Africans.
AfriForum implores you to carefully consider the arguments set out in this letter and reconsider the implementation of NHI. We hope that we will soon hear from you and that we will be able to establish a positive dialogue in this regard.
AfriForum thanks you for your kind consideration. Yours faithfully
Kallie Kriel CEO
Issued by Chanté Kelder, Media Relations Officer, AfriForum, 26 May 2022