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Treasury calls for rethink on health funding
Tamar Kahn
2004-11-04

Primary care facilities in cities do not need provincial middleman National treasury has asked health minister Manto Tshabalala-Msimang's department to reconsider its plans for funding primary healthcare in SA's six metro areas, saying the planned shift in responsibility for this level of care from local to provincial government is risky and may prove too expensive.

The six metropolitan councils centred on Johannesburg, Tshwane (Pretoria),East Rand, Cape Town, Durban and Nelson Mandela (Port Elizabeth) currently account for about R700m of the R1bn annual primary healthcare spend, which they fund from rates.

Under the National Health Act, which is expected to come into effect in the 2005-06 financial year, provincial health departments are to take over responsibility for primary healthcare, which they can then delegate to local authorities.

The act's intention is to consolidate fragmented primary healthcare services under a single level of government, and will leave local  government responsible only for environmental health services.

The act will also mean that the treasury will replace local government as the funder of primary healthcare services, which it is to do via increases to the equitable share form of grant funding given to  provinces. But a senior treasury official said that the health department was being urged to discuss alternative arrangements with the metropolitan areas.

We're not sure removing metro government from primary healthcare is the right intervention, and we're not sure it's affordable, the treasury's health policy director, Mark Bletcher, told Business Day last week.

For example, Cape Town runs more than 100 clinics, and has done so for more than a hundred years and yet here's a legal dispensation where they have absolutely no function unless it's delegated or assigned (by the province), and have no role in financing it, he said.

Primary healthcare facilities include clinics, community health centres and some hospitals.

The treasury's approach to the funding mechanism for primary healthcare was also signalled in the medium-term budget policy statement, which  Finance Minister Trevor Manuel has just tabled in Parliament.

Metropolitan councils are likely to maintain delivery of these  (primary healthcare) services, said the statement. Bletcher said one option under discussion was to make the metropolitan authorities responsible for primary healthcare and fund them directly.

Another possibility would be for the metros to run the services and  provide top-up funding above a norm supplied via the provinces.

Bletcher also said February's budget would include allocations to the  non-metropolitan areas via the equitable share, starting with about  R200m in 2005-06, and rising to R300m in 2006-07 and R400m in 2007-08.

He said that treasury was concerned about the ability of some of the weaker district councils to manage the primary healthcare transition. 

The risk we have to avoid is that local government runs down the  services without province adequately compensating, he said.

Repeated attempts to obtain comment from the health department were  unsuccessful.

The act has not yet come into effect as it still it requires a date to be set for its enactment by President Thabo Mbeki.(Business Day, 1 November 2004).

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