Godongwana knows how insane NHI is, but dare he say so? - Solidarity

Movement says to think that govt can collect approximately R300bn through taxes is foolish

Godongwana knows how insane the NHI is, but dare he say so? 

20 February 2024

Solidarity hopes wisdom will prevail in Finance Minister Enoch Godongwana’s Budget Speech by clearly stating that South Africa cannot nearly afford National Health Insurance (NHI).

Despite political pressure the National Treasury has not yet given any indication in the run-up to the 2024 Budget Speech that it believes the NHI to be feasible at all.

According to Theuns du Buisson, economic researcher at the Solidarity Research Institute (SRI), South Africa’s tax revenue as a percentage of the gross domestic product (GDP) is already much higher than in almost every other country in the world, and taxpayers are therefore already paying more tax than what they can actually pay.

“To now think the government can collect the approximate additional R300 billion which the NHI will cost through taxes is of course insane. 

“The country has been maintaining a budget deficit for the past few years, which has caused national debt to rise further every year. Yet another major budget item will sink the country,” Du Buisson said. 

Du Buisson emphasises that the state’s income already exceeds the limits of fairness of what it can collect, and the same can certainly be said of its expenditure.

“The minister owes South Africans the truth. This he will do if, in his Budget Speech, he describes the NHI as a castle in the air, rather than telling with unfounded cadre positivity more tall stories about it,” Du Buisson said.

Du Buisson is not surprised about Gauteng premier Panyaza Lesufi’s plea that Pres. Cyril Ramaphosa sign the NHI Bill “for the sake of better health care”.

“Lesufi says the Gauteng government wants to buy back 18 private hospitals, turning them into state hospitals in preparation for the NHI.

“For such a thing to make sense it should be proven that the state can, after all,run hospitals better than the private sector. And yet, there is a long list of evidence underlining the opposite.

“This, like the NHI plans themselves, is complete madness. The National Treasury has the opportunity to do the honourable thing by acknowledging it,” Du Buisson said.

Issued by Theuns du Buisson, Economic Researcher: Solidarity Research Institute (SRI), 20 February 2024