RHAP Submission on the Medium Term Budget Policy Statement 2015: More bad news for human resources for health (Version 1)

RHAP Submission on the Medium Term Budget Policy Statement 2015: More bad news for human resources for health (Version 1)

Submission to the Joint Meeting of the Standing and Select Committees on Finance, Public Hearings, 28 October 2015. 

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Summary and recommendations

This submission is made to the Joint Meeting of the Standing and Select Committees on Finance on the 2015 Medium Term Budget Policy Statement tabled in Parliament on 28 October 2015. The Rural Health Advocacy Project’s interest in the MTBPS emerges out of its work on health care financing and rural health. While our financing work covers a broad range of financing issues including equity, efficiency and effectiveness of expenditure in rural health care contexts, this submission narrows its focus to the impact that budget policy decisions could have on access to human resources for health within the public system.

Over the last two years the RHAP has witnessed an increasing occurrence of staffing moratoria or the freezing of posts being implemented at the provincial level. While there are several contributing factors that result in such action, in our view the issue is primarily budgetary.

While provincial health expenditure has more than doubled in real terms over the last decade several budgetary pressures have emerged that could potentially have catastrophic consequences for service delivery. These primarily relate to the fact that even though health expenditure increases beyond inflation each year, substantially higher than inflation increases to the compensation of employees and a substantial increase in the number of administrative and policy level posts, often at the expense of service delivery posts, has meant that budgets are often insufficient to sustain current staffing levels.

Provincial departments have traditionally managed these pressures by securing adjustments to CoE budgets during the MTBPS or shifting funds from other areas of the budget such as goods and services. This action has contributed to growing accruals where goods and services expenditure has not been adjusted to account for shifts within spending priorities. These accruals have contributed to a hidden deficit that must be recovered from current expenditure without necessary budget adjustments being made. This simply results in the deepening of the crisis.

In an effort to control overspending and cost pressures that emerge from higher than inflation increases to CoE, provincial departments of health and treasuries have started implementing staffing moratoria or the freezing of posts. This has either been done officially (including memos and instructions on the filling of posts) or unofficially through repeated delays in making appointments.

A reading of the 2015 MTBPS reveals that the situation is bound to become far worse over the 2016/17-2018/19 MTEF. Again, while health budgets increase beyond inflation they are insufficient to meet growing cost pressures. In response the MTBPS explicitly states “The revised MTEF provides no funds to expand public sector employment over the next three years…and some departments may need to reduce their establishment”

Our concern is that that should these austerity measures continue in the way that they have been implemented in some departments over the last two years, there will be catastrophic consequences for health care. These include diminished capacity to deliver services; poor supervision of existing staff; weakened support processes (e.g. procurement); additional strain being put on already overburdened staff; and consequently, overburdened staff leaving the public service deepening the crisis.

Appreciating that it may not be possible in the immediate future to simply allocate more funds to address the shortfall we argue that the Constitution and other administrative justice laws demand that any action that is taken is reasonable and does not have any catastrophic consequences for the right to have access to health care.

We therefore recommend that, at a minimum the following action is taken:

  1. The National Department of Health in collaboration with the Treasury should provide guidance through policy on how provinces are expected to protect critical posts at times of austerity
  2. Critical posts need to be defined locally and these can include health professionals and support staff. The purpose is not to define which categories of staff are to be considered critical. Instead the consequences on patient care should be the determining factor on deciding whether post A in facility B is critical under the given circumstances. Here critical posts are simply defined as those that potentially have catastrophic consequences for service delivery if they remain unfilled
  3. Districts are expected to develop costed recruitment plans but this does not happen; if such plans are in place it can help District Managers to identify priority posts at times of staffing moratoria. The treasury should play an active role in ensure this happens and should provide some guidance on how financial aspects should be addressed
  4. Decision–making on cost-saving and cost-cutting must be made at the district level by giving districts the amount to be saved and allowing the district to decide based on PAJA principles of rationality, proportionality and the over-arching constitutional right to progressively realise the right to health, not to stagnate and not to deteriorate
  5. Corruption and unauthorised expenditures should be performance managed instead of punishing all managers and districts by withdrawing their authorities for the transgressions of others
  6. Government need to provide guidance for Treasuries on how to exercise their discretion in protecting health rights where the treasury directly intervenes in the business of health administration

Related coverage: http://www.dailymaverick.co.za/article/2015-11-09-groundup-eastern-cape-c-government-job-freeze-alarms-health-professionals/#.VkrT9-krfdk