Department Budget: briefing

Meeting report

HEALTH PORTFOLIO COMMITTEE
8 April 2003
DEPARTMENT BUDGET: BRIEFING

Chairperson: Mr. L. Ngculu (ANC)

Documents handed out:
Department's Strategic Plan
Vote 16: Department of Health (link to Treasury website)

SUMMARY
The Department informed the Committee that it would focus on reducing inequities in the health care system in addition to improving the quality of care that was provided at all levels of the health care system. These processes would be coupled with measures to increase the efficiency of service delivery. The total allocation for the year 2002/03 was R 7,653,997 billion. The real increase between this period and 2003/04 was 16,72% which came to R 9,57% when the currency was adjusted accordingly.

The Department informed the Committee that despite significant strides in addressing inequities in distribution of resources to provinces being made between 1994 and 1997 recent analysis indicated that inequity in per capita expenditure on public health services had deepened. It was also reported that although some gains had been made in terms of inter-provincial equity between 1995 -1997 evidence was emerging of a reversal of this trend. Conditional grants were partly used to compensate for inequities between provinces and that it had become clear that some provinces like Limpopo would need to increase their budgetary bill.

MINUTES
Briefing Dr. Ayanda Ntsaluba , Director-General, Department of Health
Dr. Ntsaluba informed the Committee that his Department had cultivated greater co-operation with Provincial Departments and that this collaborative effort was reflected in the Department's Strategic Plan which highlighted measurable objectives, indicators and targets for the next three financial years. The Department's vision was to play a key role in securing a caring and humane society in which all citizens had access to affordable and good quality health care. The mission of the Department was to build on the achievements made since 1994 in improving access to health care for all. The Department would focus on reducing inequities in the health care system in addition to improving the quality of care that was provided at all levels of the health care system. These processes would be coupled with measures to increase the efficiency of service delivery.

Commenting on the changing epidemiological patterns in the country, for the period January to August 2002, only one case of tetanus neonatorum was reported. During the same period five cases of whooping cough were reported compared to 24 cases for the same period in 2001 noting the overall the mass campaign and routine immunisation was bearing the desired result. The incidence of TB cases for 2001 was 423 per 100,000 population and that in terms of the notified cases, this prevalence translated to more than 188,000 cases of which more than 83,000 were new smear positives - meaning infectious. Overall HIV prevalence rate was 22.4% in 1999, 24.5% in 2000 and 24.8% in 2001. The prevalence rate for HIV among adolescence aged below 20 years declined from 21% in 1998 to 16.5% in 1999 which case stabilised at 16.1% in 2000 and 15.4% in 2001.

Turning to the epidemiological changes on malaria and cholera fronts, Dr. Ntsaluba pointed out that malaria cases for 2002 to 30 November 2002 were 14,468 and 86 respectively. This figure represented a 42% decrease in malaria cases and a 23% decrease in deaths compared to the previous year. The total number of cholera cases in the country was 106,389 and that there were 229 deaths less than the WHO recommended figure of 0,5%. A range of departmental accomplishments were outlined including the number of designated top facilities that were functional having increased by 17% in 2002 from 109 to 50% out of 315 designated facilities. All provinces were implementing the prenatal problem identification programme which helped to identify causes of prenatal death. Sites at which female condoms were distributed increased to 200 from 114 in the previous financial year and that 358 million condoms had been distributed at a cost of R17 million in the financial year 2001/02.

Briefing by Gerrit Muller - Chief Financial Officer
Mr. Muller informed the Committee that the total allocation for the year 2002/03 is R 7,653,997 billion and that the real increase between this period and 2003/04 is 16,72% which comes to R 9,57% when the currency is adjusted accordingly. On the cholera-financing program, he pointed out that a total of R 109, 830, 761 was received. Donor funds received were as follows: the Japanese Government Grant to KZN and for HIV/Aids; the WHO funding and that of the European Union and that an additional R4 million was received by the Free State from the Irish Aid scheme. Provincial governments develop the work plans and that funding was allocated on the basis of approved plans. The Department had finalised the costing of packaging of care at all levels in order to drive equity in all resource allocations. He regretted that despite significant strides having been made between 1994 and 1997 to address levels of inequity in funding, recent analysis indicated that inequities in per capita expenditure on public health services had deepened.

Mr. Muller pointed out that the least increase in funding was experienced in health and welfare bargaining and employee relations which incidence he attributed to the restructuring processes being undertaken in this area. He noted that 32,92% of the budget would be expended on personnel services whilst 89,12% of the kitty had been transferred to the provinces. Fluctuation in the administration costs was due to capital expenditure part of it going to cover the expanded legal unit and the rest fell under the establishment of the Deputy Minister's office. The relocation of the SADC head office to Botswana caused some increase in expenditure to cover this new administrative structure. Some gains had been made in terms of inter-provincial equity between 1995 -1997 but that evidence was emerging of a reversal of this trend. Conditional grants were partly used to compensate for inequities between provinces noting that it had become clear that some provinces like Limpopo needed to increase their budgetary bill.

Briefing by Yogan Pillay, Chief Director, Medical Science
Mr Pillay informed the Committee that the Department was strengthening the planning process while at the same time linking short to medium and long term planning which would lead to the development of an integrated planning framework. The Department supported provinces with Parliamentary Support Programmes and assisted in the monitoring of implementation of programs. The Department also monitored the provision of the full primary healthcare package and it had entered functional integration service level agreements with the provinces to facilitate this exercise. The Department had finalised the definition and costing of municipal health services and currently augments efforts by the provinces to improve services in rural nodes.

Mr. Pillay informed the Committee that all facilities that provided maternity services were encouraged to implement the minimum data set to collect relevant information to assess prenatal care. In all the provinces there were facilities that were implementing the Prenatal Problem Identification Programme (PPIP) which helped identify causes of prenatal death. In 2000, 27 public sector facilities implemented the PPIP program and this figure rose to 91 by 2002 and singled out Limpopo one province with more facilities with the program than the others. The program was voluntary and therefore implementation was restricted to the interest shown by health workers at facility level.

Discussion
The Chair noted that inequity in the distribution of resources to provinces was one fundamental issue about which the Committee was most unhappy with. He called on all stakeholders to find the best way to intervene and resolve the issue.

Dr Ntsaluba concurred with the Chair and expressed his exasperation with the outstanding question of inequities noting that it was the one issue the Department was beginning to reach a dead end in its search for a resolution. The only way out was for intervention from high up the political ladder. The Department had tried to resolve the matter through adjustments in conditional grants. One of the stumbling blocks for the Department was the fact that it lacked a sense of control over the affairs of the provincial governments.

Mr Muller said that extensive work had been published in chapter five of the Inter-Governmental Review, which dealt with the issue of inequities in resource distribution. He promised to make a presentation to the committee on the findings of the work whenever the house called upon him to do so.

Dr. Jassat (ANC) noted that legal action costs the Department colossal sums of money annually and wanted to know if it was possible for the Department to put measures in place to avoid this occurrence.

Mr. Muller explained that the significant increase in budgetary allocation to the legal section had nothing to do with lawsuits or litigation for that matter but that it related to the expansion of the section to take in more personnel. This expansion was necessitated by the expected legal activities to be undertaken by the Department in the current financial year.

Ms. Pearmain, Chief Director, Legal Services, Department of Health offered that some litigation did not arise directly or indirectly as a result of an omission or commission on the part of the Department but that it could be as a result of Constitutional dynamics. Litigation itself was not necessarily negative all the time and that there were certain cases that sought to clarify the law and such clarification was in actual sense a positive development for the Department.

Dr. Jassat referred to the item on the funding by the Italian government to support information technology and asked whether these projects had been implemented already.

Dr. S Khotu, Director, National Health Systems, Health Monitoring and Evaluation, Department of Health replied that the donor funds were ear-marked for information technology related projects in KZN, the Gauteng and Mpumalanga and that the aim was to strengthen the Department's capacity in IT noting that all the projects had taken off the ground.

Dr. Rabinowitz (IFP) enquired what the Department was doing to address the perennial problem of human resource constraints.

Mr. Muller explained that most of the capacity constraints were felt at the provincial level noting that there was a small work force at the National Department that dealt mainly with policy and co-ordination. The Department had hired additional personnel in the current financial year to boost capacity levels and hence the increased budgetary allocation in that regard.

Dr Cachalia noted that there was no provision for poverty relief in the budget and wondered why this was so.

Mr Muller explained that the poverty relief program in its present form was being phased out and a new integrated program under the social cluster would replace this and hence there was no budgetary provision for this item in the current year.

Dr Ntsaluba chipped in and explained that poverty relief had a parallel program that was being driven by the Social Cluster, which encompassed the departments of Health, Social Development and Water Affairs. It had been noted that many provincial programs lacked a sustainability as many of the provinces were not well informed on programmes and the government decided to take a different approach to the programme.

Ms Malumise (ANC) asked how the Department was assisting the private sector to improve the treatment of sexually transmitted infections (STIs).

Ms Rose Mulumba, Director HIV & AIDS, Department of Health, replied that the Department had provided some manuals, which contained guidelines to assist private practitioners and deal with the incidence of STIs.

Ms Malumise expressed disappointment that Mr. Muller made no reference to budgetary allocations for the prevention of mother to child HIV/Aids infections.

Mr Muller clarified that indeed adequate provision has been made for the prevention of mother to child Aids transmission unit and that in addition the budget foresees an enlargement of the personnel component.

Dr Gous (NNP) asked if the cost for the implementation of Act 90 could be quantified.

Mr Muller replied in the negative noting that it was impracticable for him to define, with a reasonable measure of certainty the cost of implementing Act 90 at this point in time.

Dr Luthuli (ANC) noted that the incidence of Malaria was very high within the SADC region and asked if the Department had factored this element in the budget.

Mr Muller revealed that the government had allocated a sum of R5 million for the Lumbobo project but that this amount was insignificant given the expansiveness of the region and so the governments of Mozambique, Swaziland and RSA approached the Global Fund for assistance. The Global Fund responded positively and allotted a sum of R22 million which should significantly enhance capacity to compact the malaria menace in the region.

Dr Rabinwitz wondered why the application for funds by the SADC to the Global Fund was approved speedily yet that made by the Department had been delayed.

The Chair clarified that the Department had not at any one time indicated that donations from the Global Fund had been accessed outside SANAC structure, which was the country co-ordinating mechanism.

Dr. Ntsaluba explained that the application by SADC was an inter-country exercise, which fell outside the jurisdiction of SANAC but noted that the only hitch was who would be the principle recipient. It was decided to form a malaria co-ordinating committee with a representative from each country to sit on the committee that would be the principle recipient of the funds.

Dr. Baloyi asked what the Department was doing to assist provinces to avoid the problem of under-spending on conditional grants.

The Chair clarified that the presentation had shown that provinces over spent rather than under spent the conditional grant allocation. He asked why this problem persisted when the National Department interacted with the provinces on a regular basis.

Mr. Muller replied that according to two extensive studies conducted in 2002 it had been found that certain provinces did not receive conditional grants that were commensurate to the services they rolled-out in a given financial year. Based on this study the Department designed a roll-out plan to identify items upon which the provinces over spent the conditional grant bill but that it was noted that for the most part it was the question of reportage timing. Items upon which over-expenditure was reported were found to be in actual fact within the province's allocated budget. The other cause of over -expenditure that was identified, he explained, was related to capital programs, which like the nutritional implementation program tended to be drawn out.

As to how the Department assisted provinces to overcome over-expenditure on conditional grants, Mr. Muller pointed out that the Department intervened at three broad levels:
- Personal visits to provinces - personnel from the finance section and that of health economics carry out these visits.
-Standardising health structures in order to ensure uniformity in expenditure.
-An interaction at the financial officer's forum where ideas were exchanged on how to prepare health budgets which was carried out by personnel at the finance section. The forum looked at the pertinent issue of how to requisition the right amounts from the National Department.

The Chair noted that some provinces like Mpumalanga had an outstanding capacity problem and asked how the Department intended to intervene to help such provinces spend all the money allocated to them.

Mr. Muller replied that indeed all indications were that Mpumalanga would under-spend most of its budgetary allocations for the current year. The provincial capacity deficit was such that it called for a massive program like the one being conducted in the Eastern Cape if the budgetary uptake would be improved.

Dr. Ntsaluba offered that Mpumalanga had capacity problems caused mainly by high staff turn-over and pointed out that people from the National Department had been sent to the province to ensure that it had an informed representation to the Medical Research Council.

The Chair referred to Mr. Muller's assertion that the Department applied conditional grants in healing some of the inequitable budgetary allocations and sought clarification on this item.

Mr. Muller explained that the Department normally sorted out provinces that had been over-funded and corrected this disparity through adjusted allocation on conditional grants.

Ms Baloyi (ANC) asked about the nature of primary health care roll-out package which municipal councils would be required to provide.

Mr. Pillay explained that under the strategic planning scheme municipalities and metros would not be required to fund a full primary health care package but that the two would provide these services within their areas of jurisdiction and the rest would remain the responsibility of the provincial government.

Ms Baloyi (ANC) cautioned that she foresaw the Department facing problems in the demarcation of provinces into districts and that even rationalising the salary bill would be very tricky.

Mr. Pillay explained that the Department had proposed that all metro hospitals fell within designated district areas and that health sub-districts would be created to ensure proper demarcation in order to avoid situations of over-lap. Salary disparities became less problematic once the functions of various municipalities had been exhaustively defined.

Dr. Luthuli inquired as to what in-put the Department would secure to ensure that there was no inequity in district funding.

Mr. Pillay assured the Committee that the Department had just begun to look into the issue of inequities in budgetary allocations for districts and that ways and means would be identified to comprehensively address the problem.

The Chair wondered whether under the proposed demarcation of health services it would follow that district health management would be responsible for the provision of community health services.

Dr. Ntsaluba explained that prior to 1994 the original concept of government was very clear on the delineation of primary health services which fell under the district jurisdiction whilst tertiary services were placed under the National Department and the provinces oversaw secondary provision of health services. This clear delineation was not, however, written into the Constitution. This anomaly was the main cause of the confusion as to what constituted municipal health care and that the equitable share bill did not cover this level of service provision. This is why the Department had decided to settle for service agreements with provinces, which provided in the main that category C municipalities should co-ordinate primary health care services. He contended that the only lasting solution to the problem would be a Constitutional amendment but that at present the existing arrangement was on a trail basis.

The Chair observed that primary health care was the focal point of funding and if there were discrepancies from within the provinces then the situation would be problematic.

Dr. Ntsaluba concurred that indeed there would be problems at the funding level and that one needs a clear understanding of what was being provided at what level. The health expenditure review had shown that 12% of the budget was spent on out-patient primary health care which amount was clearly inadequate. The Department was currently working on a 30% - 50% figure and efforts were being made to protect the PHC budget as much as possible given that this item was prone to depletion for other pressing needs like replenishing pharmacies.

Dr. Rabinowitz wondered what Constitutional amendment the D-G needed when the Constitution clearly made provision for adequate health care to the citizenry.

Dr. Ntsaluba explained that the Constitution did make a positive provision for a roll-out of medical services but it did not say that this should be a service incumbent upon the local authorities which was the disturbing issue here.

Dr. Luthuli wondered whether the National Department had the competence to intervene where the provincial government was not providing adequate services.

Dr. Ntsaluba replied in the negative noting that the National Department had no mandate whatsoever to intervene into provincial governance affairs and that all it could to is to sent a delegation consisting of a task team like has been the case with the Eastern Cape recently.

Ms Baloyi differed with the D-G and insisted that the Constitution allow the National Government to intervene where service provision is wanting in the provinces.

Ms Pearmain explained that indeed section 100 of the Constitution does allow the executive arm of government but not the National Department to intervene where the provincial government has failed to deliver services.

Ms Rabinowitz enquired if the Human Tissue Act affected regulations around human cloning and human tissue research.

Ms Pearmain replied in the affirmative noting that the Act also governed any other related research activities noting that the same had been published for public comment and that it would find its way to the house soon.

Dr Jassat complained about the nuisance created by condoms dispensers, which was easily accessible to small children and wondered whether the Department was alert to this issue.

Ms Pearmain acknowledged the existence of the problem and pointed out that the Department was waiting for the necessary instructions from policy makers before it could take corrective legal measures in that regard.

The meeting was adjourned until the following day.