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Financial|Health|Power
Financial|Health|Power
financial|health|power

PSA advises Ramaphosa to delay signing NHI Bill into law

Image of Cyril Ramaphosa

President Cyril Ramaphosa

16th April 2024

By: Thabi Shomolekae

Creamer Media Senior Writer

     

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Given the uncertainty surrounding the political landscape after the May elections, the Public Servants Association (PSA) has advised President Cyril Ramaphosa to delay the signing of the National Health Insurance (NHI) Bill.

The NHI Bill was passed by the National Council of Provinces in late 2023, and sent to Ramaphosa to be signed into law.

Government has stood firm in its support for the Bill, despite warnings that it undermines universal healthcare instead of advancing its progress.

The Bill has been sharply criticised by doctors, health facility providers and health insurance companies.

The PSA said it was extremely concerned about the implications of proposed tax hikes to fund the NHI scheme, pointing out that South Africans are not able to bear such a financial burden, particularly during the current economic climate.

The PSA said government's plan to increase value-added tax and income tax to offset the NHI deficit was alarming, and it was urging government to instead address fiscal inefficiencies, including fruitless expenditure and corruption.

The PSA said the funding model presented by the Department of Health lacked sustainability, saying it disproportionately burdened the poor who were already struggling to make ends meet with a high cost of living, constant increases in petrol prices and high interest rates.

“In addition, salary increases have consistently lagged behind inflation rates, exacerbating the financial strain on households,” PSA added.

The association believes that the proposed tax hikes are likely to be insufficient to cover the costs of the NHI, and that it will also place additional strain on consumers, further diminishing their purchasing power and exacerbating financial hardships.

Previous estimates suggested that government would need nearly R200-billion a year to sustain the NHI.

With persistent economic challenges, the PSA again stressed that citizens would undoubtedly bear the brunt of the financial burden and that this would perpetuate financial constraints on households and deepen socio-economic inequalities.

The association advised government to prioritise job creation to bolster revenue streams and alleviate the pressure on taxpayers.

The PSA said any funds acquired through corrupt means must be recovered and redirected towards supporting the NHI. It also tasked government with streamlining Cabinet and reducing unnecessary expenditure.

Edited by Sashnee Moodley
Senior Deputy Editor Polity and Multimedia

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