Parliament, Friday, 24 March 2017 – The Portfolio Committee on Health and the Standing Committee on Appropriation held a joint three-day Committee meeting where they were briefed by the National Treasury, the Auditor-General of South Africa, the Financial Fiscal Commission and the nine provincial departments of health and provincial treasuries. They were briefed on the effective coordination and alignment of national and provincial spheres of government in the delivery of health services so as to ensure value for money, efficient planning and resource allocation.
The Committees heard about a number of challenges facing provincial departments, including the growth of medical legal claims, which featured prominently in the briefings from all the provinces that appeared before the Committees. The Committees expressed concern about the exorbitant amounts provincial departments are paying to resolve these claims. The provinces alleged that in some cases there is collusion between lawyers and departmental personnel.
Members of the Committee said immediate action needs to be taken to address the problem. The Committees were of the view that law enforcement agencies should be informed so that companies and individuals can be charged. Members of the Committee indicated that the matter must be reported to the Competition Commission.
Briefing the Committees, the Gauteng provincial Health Department said that it has filed to oppose a case before the Constitutional Court in which lawyers are charging 25% of future medical costs and also 25% of the total claim. The Committees welcomed the decision by the Gauteng health department to oppose the case and called on other provinces to support the province by being friends of the court during the court hearing. The Committee proposed that the matter is escalated to the national Minister of Health.
The Committees were particularly concerned that the extent of the medical legal claims may affect service delivery in the sector, as the funds to settle the claims are not budgeted for. Whilst the Committee is aware that health care workers are sometimes guilty of negligence in health care facilities, it is concerned about the number of litigation cases facing the provinces.
Briefing the Committees, the National Treasury said medical legal claims are a concern, particularly in provinces such as the Eastern Cape (EC), Gauteng, KwaZulu-Natal (KZN) and Mpumalanga. In KZN and EC, actual payouts are higher than in other provinces for the 2016/17 financial year.
National Treasury said improved systems must be put in place to manage medical legal claims. In KZN for the 2016/17 financial year, approximately R243m was paid out, an increase of 127% from 2012/13 to 2015/16 financial years. In EC, the payout of medical legal claims for the 2016/17 financial year was about R210m.
The Committee proposed a project task team be set up to investigate areas of concern identified during the three-day session. The task team from both Committees will tackle the following issues:
- Medical legal claims are an urgent matter affecting the finances and service delivery in the health sector. Besides escalating the matter to the Minister of Health, the Committee will invite the Minister to brief the Committees on the matter to provide further guidance on how the issue will be tackled.
- Budget for personnel versus budget for goods and services budget must be normalised, as the wage bill takes the bulk of provincial budgets.
- Infrastructure, maintenance and project management must improve to avoid accidents in healthcare facilities, such as was reported recently at the Charlotte Maxeke Academic Hospital in Gauteng.
- The effectiveness of district health services, including value for money in relation to employees’ salaries and the efficacy of infrastructure provision and maintenance. The purchasing, use and maintenance of medical equipment, hospital buildings, ICT and other health infrastructure is something the Committees feel strongly about, as it undermines any effort to towards attaining National Development Plan goals.
- Health information systems need to be investigated so that they are aligned nationally, instead of provinces working on their own systems.
- Challenges with accruals and non-payment for services for over 30 days must be largely resolved by 2018.
- The health sector is a concurrent function between the three spheres of government. Concurrency in some instances presents challenges. Committee Members indicated that partnerships within the sector are important.
- Provinces need to find mechanisms to deal with fiscal consolidation without affecting the quality of services.
- Budget allocations were considered a challenge in the presentations, but the Committee emphasised the importance of budget execution at provincial level. The Committee was of the view that the current budget must be spent and must show value for money.
- The Committees will sit and adopt the report, and it will then be tabled in the National Assembly as a joint report from both Committees.
ISSUED BY PARLIAMENTARY COMMUNICATION SERVICES ON BEHALF OF THE CHAIRPERSONS OF THE PORTFOLIO COMMITTEE ON HEALTH AND STANDING COMMITTEE ON APPROPRIATIONS, MS LINDELWA DUNJWA AND MS YVONNE PHOSA
For media enquiries or interviews with the Chairpersons, please contact:
Name: Ms Yoliswa Landu
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E-mail: ylandu@parliament.gov.za
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