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28 February 2013

No NHI tax expected in medium term

It is unlikely that tax will be increased in the medium term to fund the National Health Insurance (NHI) scheme, Finance Minister Pravin Gordhan said on Wednesday.

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It is unlikely that tax will be increased in the medium term to fund the National Health Insurance (NHI) scheme, Finance Minister Pravin Gordhan said on Wednesday.

"The initial phase of NHI development will not place new revenue demands on the fiscus," he said.

Tabling his 2013 Budget in the National Assembly, he told MPs: "Over the longer term, however, it is anticipated that a tax increase will be needed."

National treasury will determine funding

According to the 2013 Budget Review, National Treasury will work with the health department to determine the required funding for NHI.

A discussion paper inviting public comment on various options would be published later this year.

"The paper will also examine arrangements for risk and revenue pooling, mechanisms for the purchasing of health services - including the size and cost of the proposed health benefits package - and the mix of public and private provision of health care."

All South Africans will have essential health care

The NHI aims to ensure citizens are provided with essential health care, regardless of their employment status and ability to make a direct monetary contribution.

Last year, Health Minister Aaron Motsoaledi launched 10 pilot projects to assess various policy options for NHI.

The projects were set up in all provinces and covered 10 million people. Conditional grant funding to the tune of R1.3 billion is helping to finance the projects.

2013 budget for health care

The 2013 Budget provides for a new national health grant with two components - one for NHI and one for health facility revitalisation. The health department is to play a closer role in delivering these services alongside the provinces.

"This measure has been introduced to deal with underspending and weaknesses in the performance on these grants."

The new grant includes allocations of R291 million for 2013/14, R420 million for 2014/15 and R443.8 million for 2015/16.

The national health department will spend R370.6 million in the new financial year on the NHI and health financing sub-programme.

In 2012/2013, R182.1 million was spent on the sub programme. By 2016, estimated spending on the NHI and related funding is expected to be about R546 million.

 
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