Call us directly: 0861 111 501

Authorised Financial Service Provider

EDITORIAL: Finding the NHI’s money fairy

Frighteningly, it appears that those mandated to explain the plan to the public exist in a parallel universe, where laws of basic mathematics and finance don’t apply

30 JANUARY 2020 – 05:00


If you haven’t been particularly worried about the government’s plans to introduce National Health Insurance (NHI), it’s time to pay attention. Because not only is NHI forging ahead, but the economic incoherence in the plan is starting to become painfully clear.

In a nutshell, NHI is planned to be a form of nationalised medical aid, in which you’ll be taxed extra, and that money will go into a central fund, which will buy services from doctors and medical professionals who “contract in”. As it’s planned, NHI will all but decimate medical aids, limiting them to providing only “complementary services” for those able to pay extra.

As commendable as the goal might be, NHI was always hostage to SA’s economic constraints.

Frighteningly, it appears that those mandated to explain the plan to the public exist in a parallel universe, where laws of basic mathematics and finance don’t apply. In this universe, taxpayers are joyous and bountiful, eager to ladle more cash into the galloping kleptocracy that trampled SA.

This is clear from the NHI’s new propaganda blitz, which asks: “What is NHI?” It then glibly answers: “Every South African will have a right to access health-care services free of charge.”

Another perky tweet explains: “The NHI does not mean extra money from your pocket.” Rather, “it will be funded through taxation”.

That’s some Orwellian double-speak. Where does the health department think tax comes from? The money fairy perhaps?

In reality, this money will come directly from your pocket. To suggest otherwise is either a lie, or, at its most benign, breathtakingly ignorant.

It betrays the ANC’s thinking: that taxpayers are an endless reservoir of cash, to finance whatever flight of fancy might snaffle a vote or two.

Already, there’s profound scepticism over an NHI fund, when the existing state-run funds (like the Road Accident Fund) have been pillaged.

So, in the context of the heightened need to demonstrate that the health department is cleaner than most, the last thing health minister Zweli Mkhize needed was a nepotism scandal. Yet this week, the Citizen newspaper reported that Mkhize has appointed his niece, Sibusisiwe Ngubane Zulu, as his chief of staff.

And there’s also a cloud over Zulu’s head from her time as a director of the Public Investment Corp (PIC), after a whistleblower claimed the PIC irregularly lent money to her romantic partner, Lawrence Mulaudzi. (Mulaudzi has denied this.)

With NHI at such a delicate fledgling stage, Mkhize can’t afford such obvious missteps.

This month, the annual SA Health Review journal carried a quietly devastating account of the financial challenges around NHI, co-written by three National Treasury officials, Mark Blecher, Jonatan Davén and Wendy Fanoe. They argued that raising taxes to finance NHI would be tricky, as would persuading people to give up their medical aids to shift to the NHI. This may “emanate from a lack of trust in the integrity or sustainability of a publicly administered NHI fund in the context of revelations of corruption, state capture and failing public entities within government”.

Forcing people to move to the NHI by limiting medical aid coverage, they say, is “likely to risk widespread opposition among the 8.8-million beneficiaries of medical schemes, potentially impeding or delaying NHI implementation through protracted litigation or tax avoidance”.

Presumably, this unvarnished dose of reality would shock NHI’s reality-challenged public relations practitioners. After the last week’s events, the concern is that Mkhize and those leading the NHI project either have scant regard for economic sensitivities, or they couldn’t care less.