As tomorrow’s 29 November deadline for written submissions on the NHI draws ever closer, so the ANC is stepping up its propaganda in support of its proposed state monopoly over all healthcare in the country.

The ANC is also now asking all South Africans to endorse a brief submission saying that they:

  • support the ‘single-payer’ principle and the pooling of all resources in one fund;
  • want medical schemes to be confined to providing ‘complementary’ cover for services ‘not reimbursable’ by the NHI; and
  • agree that funding should come from ‘general tax revenues’, the ending of the medical tax credit, a new payroll tax, and a surcharge on personal income tax.

Effectively, the ANC is asking South Africans to endorse the termination of all medical schemes – for this is what will result from confining them to ‘complementary’ cover, ending the medical tax credit, and boosting taxes to fund the NHI.

It is thus also asking citizens to support a state monopoly over healthcare, which is sure to be just as inefficient, corrupt, and incapable of reliable delivery as Eskom and other SOEs.  In addition, it wants people to give it a blank cheque on the additional taxes to be introduced – including the major VAT hikes likely to be implemented to boost ‘general tax revenues’.

Both the National Treasury and the Davis Tax Committee have warned that the NHI is ‘unaffordable’ and ‘unsustainable’. Yet the ANC persists with the false mantra that the NHI will ‘deliver accessible, quality, and affordable healthcare to all citizens’, and particularly the poor.  

This mantra is deliberately misleading. As the ANC is well aware:

  • only 15% of public hospitals and clinics will qualify to take part in the NHI as 85% of them are too badly managed to comply with basic health norms and standards;
  • people will thus flock to a much smaller number of private hospitals and clinics, which will not be able to cope with the demand;
  • some 30% (and perhaps 60% or more) of doctors and health professionals will emigrate, rather than subject themselves to pervasive state controls and crippling NHI inefficiency;
  • waiting times for treatment will be even longer than at present (in wealthy Canada, waiting times more than doubled after a less draconian single-payer system was introduced);
  • the large pot of money to be gathered in the NHI Fund will become a magnet for corruption, particularly in procurement contracts;
  • all health procurement will become subject to BEE preferential procurement rules – and hence to the ‘fraud and inflated pricing’ that, according to the Treasury, already taints up to 40% of all state tenders;
  • the NHI will have to purchase and pay for every single health item or service needed every year by more than 60 million people – and is unlikely to be any better at paying its bills than a host of other state entities notorious for late payments;
  • suppliers that are forced to wait months and often years for payment (in Gauteng, 987 health suppliers have waited for more than a year to be paid the R1.7bn they are owed) will cut off supplies of medicines and other vital goods and services;
  • the stock-outs and maintenance failures currently afflicting so many public facilities will spread to private ones as well – and people will often find that their essential health needs cannot be met at all;
  • the heavy costs of implementing the NHI, which is likely to cost at least R450bn a year by 2028, will further cripple the economy and push the country yet deeper into damaging junk status;
  • taxes will be raised substantially (a 3% payroll tax, a 3% surcharge on income tax, and a 4 percentage point VAT increase will be needed at minimum), but  supposedly ‘NHI’ taxes will often be spent on other things, including the bloated public service wage bill; and
  • many people with scarce skills will emigrate in response to higher taxes and diminished health services, which will make it harder for the government to service its mounting debt or sustain its spending on social grants and other essentials.

The ANC’s false NHI promises are little more than a cruel hoax being perpetrated upon the poor. For the ANC’s real aim is not to improve health services at all, but rather to advance the Soviet-inspired national democratic revolution (NDR) to which the ruling party has regularly recommitted itself at each of its five-yearly national conferences.

The NHI will take the country closer to the NDR goal of a ‘socialised’ economy by bringing all private providers under state control and then requiring them to put ‘social needs’ before ‘private profits’ – a notion sure to bankrupt them over time.

The NHI will also help establish the NDR principle that private spending in any given sphere must be pooled with public revenues for the benefit of those in need. Once the NHI precedent is in place, the principle will be extended to other areas, including pensions, where proposals for a government-controlled ‘national social security fund’ are already being put forward.

Contrary to ANC propaganda, the NHI is also unconstitutional. Section 27 of the Constitution requires the state to take ‘reasonable’ measures, within its ‘available’ resources, to make healthcare ‘progressively’ more available to all.

But the NHI is neither reasonable nor affordable. It will weaken and, in time, destroy private health, drive many health professionals abroad, push out millions of taxpayers with scarce skills, further cripple the economy – and make all South Africans dependent on an inefficient and corrupt state monopoly unable to supply the health services now available.

By contrast, the goal of universal health coverage could easily be met through two key steps, in particular. First, the large revenues already allocated to public health (4% of GDP and 12% of overall state spending) must be far better used. This requires merit-based appointments in public facilities, coupled with strict accountability for poor performance and effective action against corruption and wasteful spending.

Second, the burden on public healthcare must be reduced by increasing access to private healthcare. Low-cost medical schemes should be encouraged rather than barred, while poor households should be helped to join these schemes through tax-funded health vouchers. To help spread risks, medical scheme membership should be mandatory for all employees, with premiums for lower-paid employees buttressed by employer contributions for which businesses would garner tax credits. Medical schemes would then have to compete for the custom of South Africans, which would encourage innovation and help hold down costs.

The many people who want effective universal health coverage – in place of the inefficient, corrupt, and unaffordable NHI – must make their voices heard. Written submissions, says the ANC, must be in by 4pm tomorrow.

The ANC submissions now being procured by false promises and propaganda must be more than outweighed by a host of alternative submissions based on fact, rational argument – and a determination to ensure that the constitutional right of access to healthcare is upheld, rather than betrayed.

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Anthea Jeffery
Dr Anthea Jeffery holds law degrees from Wits, Cambridge and London universities, and is the Head of Policy Research at the IRR. She has authored 11 books, including People’s War: New Light on the Struggle for South Africa and BEE: Helping or Hurting? She has also written extensively on property rights, land reform, the mining sector, the proposed National Health Insurance (NHI) system, and a growth-focused alternative to BEE.

2 COMMENTS

  1. “The ANC’s false NHI promises are little more than a cruel hoax being perpetrated upon the poor.”

    Herein lies the crux of the matter. Thank you for your continued efforts to save the South African health service Dr. Jeffery. I am afraid all the protests will fall on deaf ears, while the gerrymandering continues.

  2. Despite the ANC’s intentions, I just want to add this…: I don’t know where this is going to end…but there is NO end to a greedy man’s lust for money / power etc…as long as there is an ANC, we will face more and more surprises that will choke the last breath of air, out of our lungs. On the other hand, we a a Mafia of Medical schemes, that due to corruption, squeezes us to a place of self destruction with the price of a good medical scheme. I have heard first hand from a broker that 80% of the R 11 800-00 me and my wife are paying to belong to a ‘sort of’, good plan, are going to sponsor the oppressed..??? I was also told by a Doctor that we must instead of paying R 1000-00 to R 2500-00 a month, pay between R 11000-00 to R 22 000-00 a month because of corruption in medical funds. To top it of, we must, on top of the R 11 000-00 a month, have a savings plan…I hope both the medical scheme as well as the NHI take a fall. This is theft and therefor I can just hope that we can stand up against this monopoly.

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