The Auditor-General of South Africa (AGSA), the Financial Fiscal Commission (FFC) and the Department of Planning Monitoring and Evaluation (DPME) briefed the Committee on its analyses of the Annual Performance Plan (APP) and budget of the Department of Health; as well as its performance outcomes. In addition, the South African Health Products Regulatory Authority briefed the Committee on its APP and budget.
AGSA notified the Committee on the reduced number of indicators for programmes within the Department of Health where a total of 37 indicators had been reduced across the Department’s programmes to streamline its activities. This raised concerns from members on how serious the Department was in achieving its targets especially on the National Health Insurance (NHI) programme where 13 targets had been reduced. The number of vacant positions in key areas had an impact on the Department’s performance, as CEO and CFO positions remained vacant for more than 12 months in the Council for Medical Schemes (CMS) and the National Health Laboratory Services (NHLS). Information Technology Management was flagged as a major concern in the Department and sector, which needed serious interventions with regard to the implementation of the NHI programme. Other concerns included irregular expenditure, poor contract management, delays in the payment of suppliers, increases in accruals and contingent liabilities, and poor record keeping in provinces.
These concerns were similar to those of the Financial and Fiscal Commission (FFC) which drew attention to issues of financing, where accruals needed to be reduced through strict budget controls, the poor maintenance of infrastructure, human capital needs and lapses in procurement management. The lack of capacity especially in IT was worrying because of its binding constraints to the implementation of the NHI programme. High spending on employee compensation and the use of consultants was highlighted as a concern, which raised questions from Members on the most effective way of striking a balance between the lack of capacity and the use of consultants. Members were also keen to know whether poor infrastructure was entirely tied to the performance of the Department of Public Works and not supply chain problems, political interference or challenges of corruption.
The DPME report contradicted some of the concerns raised by AGSA and FFC on matters relating to IT and audit outcomes where it gave an indication of improvement in these areas. Members raised concern on the reliability of DPME’s report which was similar to that of the Department of Health and found it to be very general as they expected more details. Despite these concerns, DPME reported that health outcomes had generally improved with an increase in the number of people on ART treatment and improvements in infant and maternal mortality rates. It also noted that health sector expenditure had increased over time but leveled off with population growth. KwaZulu-Natal (KZN) and Gauteng had achieved the bulk of Ideal Clinic Status amidst Members expressing concern on the slow progress of the attainment of ideal clinic status.
SAHPRA’s briefing to the committee on its performance plans and budget, highlighted that the compensation of employees would account for the highest expenditure of its budget at R149 million. It also highlighted the backlog problem which it inherited from the previous entity but had set up a committee to ensure the backlog problem was resolved within achievable timelines. This committee would be financed by revenues from an increase in fees which raised concern from members on the effect of fee increases on the cost of medicine. The successful achievement of the Authority’s goals relied on financial resources, IT infrastructure, resource capacity and a skilled human capital which called for training and capacity building of its human resources. SAHPRA was keen to create stakeholder awareness and improve communication leading to the development of a communication strategy that would be approved in 2018/19. It had also developed an IT Policy which would be approved in 2018/19.
Briefing by the Auditor-General on the assessment on the reviews of the Health Sector’s annual performance plan and budget
Ms Sithembile Ngubane, Manager, AGSA, briefed the Committee on the Annual Performance Plan (APP) and budget for the Department of Health. APPs for 2018/19 have not been reviewed for the Compensation Commission for Occupational Disease (CCOD) and the Medical Research Council (MRC) because CCOD was a year behind in its reporting and MRC had been clean for a number of years such that risk was not foreseen.
There was a reduction in the number of indicators for the 2018/19 APP to streamline the Department’s activities in preparation for the National Health Insurance (NHI) programme -13 indicators and targets had been reduced from the NHI, health planning and systems enablement programme; 14 from HIV/AIDS and maternal/child health care, while 10 from the hospital, tertiary health services and Human Resource Development programme. Key matters of concern were the vacant positions in top management of entities within the Department which affected its performance. CEO positions remained vacant for more than 12 months in the Council for Medical Schemes (CMS) and the National Health Laboratory Services (NHLS) while the Chief Finance Officer (CFO) and Head of Internal Audit and Risk Management remained vacant in the NHLS for 12 and 9 months respectively. It was however important to note that some of the positions were vacant because of the suspension of officials, as a result of disciplinary proceedings that were currently taking place.
The status of records that were reviewed for the National Department of Health raised major concerns in Information Technology (IT) management that needed interventions, because concerns raised over the past three years had not resulted in any changes. Suppliers not paid within 30 days raised concerns in compliance management, the lack of response to findings on internal audits raised concerns in performance management, poor management of contracts raised concerns in procurement and contract management, and problems with the asset register and accruals raised concerns in financial management. In terms of the overall picture of the health sector, concerns were raised in Human Resource (HR) management because of vacant positions for key management positions in the provinces. Financial management was affected by the high number of legal claims in the provinces which increased contingent liabilities. Record keeping in the provinces affected performance management, while compliance with regulations and irregular expenditure affected procurement and contract management. IT was also a major concern in the provinces as it was sitting in red.
AGSA recommended that the Committee continue with its oversight responsibility of reviewing the performance of the Department and urged them to conduct focused intervention studies including site visits.
Ms Kopane S (DA) expressed disappointment in the late distribution of documents, because it was important for Members to receive documents on time to engage effectively.
Ms E Wlison (DA) requested for time to go through the annexures.
The Chairperson granted Members 15 minutes to go through documents before discussion
Ms Kopane asked AGSA to clarify why the APPs for MRC and CCOD were not reviewed. Were they going to be reviewed later? She understood that the reduction in the number of indicators was to streamline the Department in preparation for NHI, but the very programme had 13 indicators reduced from it. She asked if the Department could the Department explain why this was the case because she would have expected it to have more indicators to demonstrate its seriousness. Why had the indicators for HIV/AIDS and maternal health been reduced by 14 indicators when the country was already struggling to fight HIV/AIDS, especially after this programme had been allocated a budget of R22 billion? Why were indicators being reduced despite the existence of challenges? One of the challenges in implementing NHI was the lack of medical doctors and nurses, but 10 indicators had been reduced from the Hospital, Tertiary Health Services and Human Resource Development programme. How then was NHI going to be achieved when it required that the number of doctors be tripled? The HIV/AIDS and maternal health programme appeared to be doing well on paper because it had no indicators that were not well defined, not verifiable and not measurable, but this did not make sense in practice. Could the Committee be provided with an explanation of what was happening? It was clear that there was a problem in health services at the province level as many of the provinces were sitting in red. There was also no information on the North West and Western Cape provinces. Was there a reason why they were omitted?
Ms Wilson found it stressful that the number of indicators and targets in preparation of NHI had been reduced. How could the health system be effective if the number of indicators had been reduced? Vacancies in entities within the Department were indeed a serious issue, particularly in light of the performance failures of the provinces. The fact that not even one province came close to complying with key controls in the Department was indicative of a serious problem in the health sector and that was severely alarming. It was clear from the presentation that NHI could not be implemented because there was no effective health system for the poor and vulnerable.
The Chairperson informed members that some of the questions such as those on indicators and the issue of NHI were more relevant to the Department of Health and not AGSA.
Ms Kopane suggested that officials from the Department be present in future meetings when discussing issues related to their department.
Ms Ngubane clarified that AGSA reviewed what was presented to it by the Department of Health and only did a year-to- year comparison of indicators, which showed a reduction in the number of indicators for the 2018/19 APP. She requested the Committee to direct the question on indicators to the Department. The 2018/19 APP for CCOD was not done because CCOD was a year behind in submitting its financial statements and conducting its audits which followed the same for its performance plan review. In the case of MRC, the entity had been clean for a number of years and was therefore not necessary to conduct an APP review, because the focus of APP reviews was to identify early warning signs where AGSA foresaw problems in measurability and relevance. The status of record review for the Western Cape was not done because there were no changes in internal controls since year end and was therefore not going to be a fruitful engagement. For the North West, management had informed AGSA of delays in their reviews but had also reported no changes in the number of internal controls since year end.
The Chairperson asked AGSA to improve on the timelines of delivering their reports to Members. She also reminded Members that AGSA’s presentations were only meant to assist the Committee in understanding the Department’s plans for the year. The importance of having AGSA before the Department was to empower the Committee with information. She asked AGSA to include information on all provinces when reviewing APPs to get a clearer picture of performance, even if there were no changes at the end of the year, as in the case of the Western Cape.
Briefing by the Financial and Fiscal Commission (FFC)
Prof. Daniel Plaatjies, Chairperson, FFC, began his presentation by highlighting four matters which health systems were dependent on and needed to be resolved in the next financial year by the Department. These included financing, where accruals needed to be reduced through strict budget controls and timely monitoring, the maintenance of infrastructure, human capital management and procurement management.
Mr Eddie Rakabe, Researcher, FFC, explained that the multiple goals in the Department overstretched the budget resulting in the Department not being able to achieve its targets. Policy objectives and delivery targets overlapped between the Medium Term Expenditure Framework (MTEF) and Medium Term Strategic Framework (MTSF), making it difficult to measure performance in relation to budget allocations. There however existed links between short term, medium term and long-term goals for most of the Department’s goals which was important. Health outcomes in general had improved with an increase in the number of people on ART. Non-communicable diseases had however been on the rise calling for a shift of focus and budget to this area.
The Administration Programme which was responsible for the overall administration of the Department had demonstrated consistent under-performance over the years. To solve this problem the Department should re-size this programme and redirect resources to health district offices. The NHI programme was very critical but resources allocated to the programme were worrying. IT capacity was particularly important for the Department to achieve this target. The programme on HIV/Aids maternal and child health which received the second highest share of the total budget saw an increase in scope which could affect targeted output delivery. The Primary Health Care Services Programme was not doing well at the provincial level because of resource constraints while the programme on Hospital, Tertiary Health Services and Human Development accounted for the largest share of the Department’s budget. The Health Regulations and Compliance Management programme required the Department to minimise the number of independent entities as they were too many.
The health budget accounted for 13.9% of total government spending which increased over the 2018 MTEF period. Provincial audit outcomes had improved since 2012/13, but the pace of improvement had been slow. Fruitless and wasteful expenditure by provinces had increased from R871 million in 2013/14 to just over R1 billion in 2016/17 which was a cause for concern. For the period 2012/13 – 2016/17, provinces spent on aggregate close to 100% on most health conditional grants with the exception of the Health Facility Revitalisation Grant (HFRG). High spending on compensation was also a concern but FFC welcomed the emphasis on improving primary health care (PHC) facilities. The challenge of under spending on HFRG required the Department to conduct an assessment to improve delivery outcomes, while also achieving cost effectiveness. There was also no indicator of how the Department planned to assist provinces in achieving their targets of improved audit outcomes which was a major concern.
Ms Wilson sought clarity on the NHI projects that were run in various provinces where doctors were employed as part of the projects. Was payment of doctors done via the grant through the provinces as a provincial mandate and not a national health mandate?
Mr A Mahlalela (ANC) sought clarity on the difference between performance indicators and strategic objectives as referred to on the presentation. Did they have different meanings or were they used interchangeably throughout the presentation? Were the Commission and AGSA referring to the same APPs because the number of indicators under the Department’s programmes was different for both entities? Had the commission interacted with the Department to understand the reason for the proliferation of entities which was highlighted as a concern? Did it make an assessment of the Department’s capacity which may have resulted in the high use of consultants because of limited capacity? The fact that the Department performed poorly year in and out with an achievement score of 45% - 55%, despite having spent its budget in totality demonstrated that there was a problem with planning and capacity within the Department. How then should the Department balance the lack of capacity and the use of consultants? Was the performance of infrastructure within the Department tied in entirety to Public Works’ capacity or could it also be tied to supply chain problems, political management and challenges of corruption? It was important for FFC to give a holistic picture of where the problem lied so that a holistic solution could be developed to address the problems which had persisted over the years.
Could the commission also provide a budget breakdown per province for PHC in the context of the District Health Service Programme, to give a clear indication of how each province was performing? This was because the 44% of the provincial health budgets that was allocated to the District Health Service programme was an average of all provinces which could be skewed when looked at individually. Based on FFC’s interaction with the Department, did the Department have new norms and standards that were important for budgets to be aligned to? How correct were the provincial audit outcomes of 2016/17 as indicated on FFC’s presentation because previous reports showed that the Eastern Cape had improved while North West had lapsed? The unqualified opinion on the National Department also meant that the Department had scored a clean audit but he was not aware of this attainment by any of the health departments. It was worrying that fruitless and wasteful expenditure had increased. Why was this? Was it due to a lack of consequences, stealing of funds or recklessness in payment leading to the accumulation of interest?
The Chairperson sought clarity on what specific area consultants were being hired for. Was it for administration, clinical or support services? If there were unreported cases of wasteful expenditure in the provinces, how would the Committee know about them?
Prof Plaatjies confirmed that there was no NHI fund yet but an allocation towards its establishment. It was therefore not clear whether payments to doctors for projects under NHI were from the grant, but the Department would be in a better position to answer the question. The statement on the proliferation of entities was made based on data from financial reports and statements, estimated national expenditure and trends developed from such expenditure. FFC only engaged with the departments on policy matters because of the requirements of the Public Finance Management Act (PFMA) on departments’ implications for sub-national governments at the provincial and municipal level. It also engaged with departments on big projects such as the NHI that may have an implication on the constitutional form of the state. Related to policy was the financing required for a policy where FFC engaged departments especially on the implementation of a policy that did not adequately reflect fiscal resources.
There was indeed a relationship between the Department of Public Works and supply chain management in the Department of Health, but FFC focused more on looking at APPs, the budget, the division of revenue and giving recommendations more than it did on the existing relationship. Capacity was indeed a problem but extended beyond human resources to include systems, processes, financing, legislation, structural arrangements of an institution, relationship management within a Department and time. FFC’s role was not to investigate wasteful and fruitless expenditure but rather interpret information from reports because a forensic investigation would provide more details. It was also not aware of new norms and standards within the Department of Health. On the audit outcomes, FFC data’s was correct because it was based on the Auditor General’s summary report with information showing trends over time and improvements from 2013 to date.
Mr Rakabe said that contracting of doctors for the NHI project had been faced with challenges in capacity resulting in the National Department and Provinces contracting on behalf of the district health offices. Contractors therefore billed the Department of Health but payment was made from the NHI grant. The audit outcomes were indeed from the office of the Auditor General and performance indicators and strategic objectives had been used interchangeably throughout the presentation. The issue of consultants was in the context of a lack of capacity where a high percentage of the budget for consultancy was going to the development of e-health platforms for the NHI programme. This was expected in the beginning of the project but it was important for the Department to build its own capacity to have people who could maintain the e-platforms during downtime.
Prof Plaatjies requested for time to provide additional information on matters outstanding based on the trend of questions asked by members of the committee.
Ms Kopane asked FFC to provide information on the amount spent on doctors trained outside the country, given that there was a recommendation to cut down the number of doctors trained abroad. In terms of different provinces, how much was the Department spending on doctors trained outside of the country because Free State had spent R50 million for training in Cuba and R35 million for training in China between 2015 and 2016.
Mr Rakabe was not sure of the exact numbers but was sure of 5 000 doctors being trained in Cuba. More information would however be provided to the committee in writing at a future date.
The Chairperson reiterated that presentations from entities such as the FFC were for purposes of providing insight to the committee and that the greater percentage of challenges that would make or break the health sector depended on warm bodies. How then could the sector navigate in the midst of the challenges it faced? It was important to focus on the lessons that could be drawn from the challenges facing the Department of Health rather than dwelling on negative aspects. Another challenge facing the sector was the support given by the National Department of Health to provinces. Was the support welcome and appreciated? Perhaps the Department of Health would provide better insight to the committee on this matter.
Briefing by the Department of Planning, Monitoring and Evaluation (DPME)
Mr Thulani Masilela, Outcome Facilitator: Health, DPME highlighted in his presentation that national health outcomes had generally improved. This was demonstrated by an increase in life expectancy to 61.2 years, improvements in infant and under-5 mortality rates, a decline in institutional maternal mortality rates (MMR) and an increase in the access to Antiretroviral Treatment (ART). Even though access to ART had improved, there was regress in behavioural trends with respect to HIV/AIDS. Despite notable improvements in under-5 and maternal mortality rates, South Africa was lagging behind in comparison to other BRICS countries. Non-communicable diseases and stunted growth were also on the rise as the level of stunting increased from 24% in 2012 to 27% in 2016. Of significance was the inequitable distribution of health gains between and within provinces, such that how long one lived was influenced by the province one lived in. This inequitable distribution of resources was evident in the public and private sector with poor quality of health care in public facilities. Inadequate infrastructure for mental health services, little progress in the implementation of the Ideal Clinic programme and the immense financial pressure of the public sector were among the challenges facing the health sector. High costs of treatment in the private sector remained a barrier to the access of health services for majority of South Africans.
On the indicator for Ward Based Primary Health Care Outreach Teams (WBPHCOTs), the target had been exceeded as there were 3 519 functional WBPHCOTs against a 2019 target of 3 000. The annual target of having 2 000 medical students trained in Cuba and employed in the public sector would likely be achieved. The Department was faced by persistent negative audit outcomes in the past but this had improved in the 2016/17 audit report as the Department and four other provinces had received unqualified audit opinions. Of the 22 hospitals that were supposed to be constructed or revitalised, only 12 had been revitalised while 99 clinics and community health centres had been revitalised against 106 that were supposed to be constructed. There was slow progress in MDR-TB treatment while no progress in the number of men medically circumcised. The health sector implementation of the Health Patient Registration System, a critical component of NHI was progressed well. KwaZulu-Natal (KZN) and Gauteng had achieved the bulk of ideal clinic status with 593 out of 602 achieving this status in KZN, and 362 out of 370 in Gauteng. KZN had also registered the highest number of people on ART.
Health sector expenditure had increased over time but leveled off with population growth. The uninsured population had also grown substantially over time. On the way forward, effective leadership was important to improve financial audit outcomes and ensure efficient service delivery. It was necessary for the health sector, the Department of Water and Sanitation and the Department of Agriculture to work together to improve health outcomes in South Africa.
Ms Wilson sought clarity on the implementation of ideal clinics which had been achieved by 1 227 clinics against a 2019 target of 2 823, demonstrating a lag in progress. Did the total 3 478 primary health care facilities expected to achieve ideal clinic status also represent the whole of South Africa? Of the 28 billion in claims where only 1 billion had been paid off, how long would it take the Department to pay the remaining amount, considering that it almost exceeded the NHI? The Department of Health in Limpopo had stopped funding and cancelled the contracts of 426 community health care Non-Governmental Organizations (NGO’s) and put out a tender for only four. How did this correlate with the health worker policy that was yet to be finalised? Was this the way forward for government and if so, what was going to happen to the 15 000 community health workers that were no longer employed?
The statistics on stunted growth were very serious because stunting affected the development of children for the rest of their lives while most families depended on grants of R800 per month. This dependence was expected to increase steadily under the current economic climate and therefore needed to be addressed by the Department of Social Development. Of the 22 hospitals that were supposed to be constructed or revitalised, how many were supposed to be constructed? It was pretty alarming that none of the 106 clinics that were supposed to be constructed were actually constructed especially when there was a shortage of clinics in the country. Clarity was also sought on the mobilising of resources for the implementation of the community health care workers policy.
Mr Mahlalela sought clarity on how different the presentation was from the Department of Health’s Annual Report. The expectation was that DPME would make an independent evaluation and analysis. What tool did it use to arrive at the same conclusion as that of the Department of Health? In relation to FFC’s presentation, how could DPME conclude that the Department of Health’s performance had been good on audit outcomes when FFC reported otherwise? The presentation should have created a link between accruals, fruitless and wasteful expenditure and irregular expenditure as increases in fruitless and wasteful expenditure would have instead paid the Department’s accruals. Irregular expenditure was as a result of failures in the procurement process which created high costs in service delivery, which led to delays in payment for escalated costs and in turn led to accruals.
The presentation gave an indication of the Department doing well in non-communicable diseases despite them being on the rise. Tuberculosis which was a big problem had also indicated improvement which was not the case. Was the Office of Health Standards Compliance (OHSC) really contributing towards the entrenchment of quality healthcare services in South Africa as indicated on the presentation? How did DPME get information on the unqualified audit outcomes of five health departments when the AG report for 2017/18 was not yet out? For the additional clinics that were supposed to be constructed, how did DPME indicate a green when this target had not been achieved?
Ms Kopane asked what criteria were used to select the four provinces where the patient satisfaction survey was conducted in 169 primary health care facilities. The implementation of e-platforms for the Department of Health that was shown to be doing well contradicted that of FFC. Was there an explanation for this? From the presentation it was evident that access to PHC facilities was a major challenge as approximately 2 million people had to travel long distances to access health care facilities. One clinic was currently serving about 16 800 people as opposed to 10 000 prescribed by the norms and standards of the World Health Organization. How often did DPME assist the Department of Health on challenges of infrastructure, human resources, supply chain management and financial management? Did it have an action plan on the same?
The Chairperson asked how the Department conducted its monitoring and evaluation because she observed that the presentation was very general. She expressed disappointment in the Department’s presentation and content which had a huge responsibility of assisting the health sector.
Mr Masilela explained that DPME monitored the implementation of the National Development Plan through the MTSF that was developed by the national government. DPME used a triangulation tool that sourced data from Statistics South Africa, international sources and visits conducted in health facilities. To prioritise facilities that needed a visit, it analysed data from the District Health Information System and also used its own Programme of Action (POA) monitoring system, which facilitated the monitoring of inconsistencies in data over time. As it was not possible to visit all 3 800 primary health care facilities in the country within a year, a sample was selected from the 3 800 health care facilities.
The Chairperson clarified that the Committee did not expect DPME to visit all health care facilities, but expected them to give information on the samples that were selected in terms of province. Was this impossible for the Department to do? She noted that the responses from the Department were not taken kindly.
Mr Masilela accepted the Chairperson’s remarks and agreed to get back to the Committee with more information. The similarity in presentations between DPME and the Department of Health was attributed to the Department of Health’s use of the tool designed by DPME when preparing its APP for the year 2018/19. Issues been monitored by the Department of Health were in line with MTSF and performance agreements between the Minister and the President, resulting in similarities with measurements by DPME. The financial performance of the health sector which was reported to have improved was in the context of the base from which they had come where the Western Cape and the National Department of Health were the only departments that used to receive unqualified opinions. The additional provinces that received unqualified opinions therefore contributed to this improvement. Provinces that had regressed in audit outcomes such as North West were however a concern. The R56 billion in contingent liabilities, R13 billion in accruals and 28 billion in claims of which 1 billion had been paid out, had a negative impact on the Department’s budget. Accruals were indeed influenced by fruitless and wasteful expenditure and issues of supply chain management, which were being monitored by DPME. It was true that non-communicable diseases had been on the rise but DPME was reporting from the perspective of the number of screenings done, which had increased.
The independence of OHSC had been in question in relation to what extent it was playing its role. Uncertainty around its role to monitor health service and structure based on quality improvement or quality assurance had been clarified which moved it away from controversies surrounding it. Data on financial outcomes was not only sourced from AGSA reports but other data sources. The original MTSF which had a target of constructing 22 hospitals was not achieved because of budget constraints, but revision of the MTSF focused on the rehabilitation of facilities which was done in health care facilities. A list on facilities visited, constructed or revitalised per province will be provided. On e-platform systems DPME appreciated the number of facilities where the system had been implemented in capturing patient data where over 6 million patients had been registered. Challenges were on the slow pace of implementation, determining the primary patient identifier, the scope of diseases that would be covered based on the disease burden in a particular area and HR being based on workload per facility rather than standard population norms. DPME held consultations with the Department of Health on obstacles in infrastructure and created a link between the health sector and the Presidential Infrastructure Coordinating Community (PICC). The number of ideal clinics setup was measured against the 2019 target for ideal clinics and also against the total number of clinics across the country. Specific information on community health workers in Limpopo would be looked into. It was however important to take note of the increase in minimum wage to R3 000 which affected the absorption of community workers who were paid on average R2 000. Provinces that absorbed community health workers would also have to increase their provincial budgets. To address stunted growth, the National Food security and Nutrition Plan was implemented in conjunction with United Nations agencies.
Dr P Maesela (ANC) asked the Department to be more specific on the areas that needed attention. What kind of attention was needed and who was going to attend to them? What specific clinics were refurbished and revitalized and could the Department give an idea of what was ideal for clinics that were classified as ideal? Could the Department also provide the Committee with solutions in future presentations?
Ms Wilson raised concerns on the tradeoff between community health workers affordability and the provision of healthcare, especially with the implementation of the minimum wage. It was quite disturbing that affordability won in such instances because people who needed 24 hour care would die in the absence of community health workers. Was the satisfaction survey in 19 hospitals restricted to government hospitals because a patient satisfaction survey carried out today would not yield an 85% satisfaction rate? Could the Department provide more information on the medical students in Cuba? What percentage of those trained in Cuba was employed in the public sector as doctors.
Ms S Thembekwayo (EFF) was not satisfied with the presentation made by DPME and asked that the Department report back with a better presentation to facilitate discussion.
The Department took note of the Committee’s comments and agreed to provide a proper break down on all issues raised. Doctors sent to Cuba signed contracts to work with government upon return, but the actual number of doctors working in public hospitals would be provided at a later date.
The Chairperson urged presenters to be less general when making their presentations and be open to difficult questions asked by the Committee. The purpose of questions was to empower the Committee when questioning departments that appeared before the Committee. She pleaded for fairness in future presentations and urgedthe Department to seek clarity on what was expected of them when invited for meetings.
Briefing by the South African Health Products Regulatory Authority (SAHPRA) on its Strategic Plan (2018/19-2022/23), APP and budget for the2018/19 financial year
Prof. Helen Rees, Chairperson, SAHPRA gave a brief introduction into the mandate of the board and highlighted a number of key areas that required consideration for the establishment of the new entity.
Among them were the delays in the registration of medicine that had an impact on the availability of medicines with adverse consequences for public health. To address this issue a Technical Operations and Regulatory Strategy (TORS) Committee had been established with the mandate of developing an integrated plan to address the backlog of all products in a defined and achievable timeline. She noted that the TORS Committee would be financed by revenue generated from the envisaged increase in fees. The transfer of critical evaluation skills to in-house staff through training and capacity building was also important, while that of recruiting additional technical staff to address the regulatory workload was needed. A well-functioning IT system was a key support component in resolving current delays in regulatory decision-making and would ultimately contribute to improving the delivery of quality services.
Ms Portia Nkambule, CEO, SAHPRA explained that the administration programme required a fully functional authority which was suitably staffed to execute the mandate and goals of SAHPRA. For the Authority to successfully achieve its strategic goals, financial resources, IT infrastructure, resource capacity and a skilled human capital were critical, 60% of staff were set to be trained and 80% of funded positions were going to be filled by the end of 2018/19. To create stakeholder awareness and improve communication, SAHPRA had developed and approved a communication strategy and planned to hold four communication events and stakeholder meetings in 2018/19. It had also set a target to develop and approve an IT policy in 2018/19. For the programme on authorisation management, SAHPRA intended to address the backlog in applications and issue licenses and registration within a specified timeline. A backlog framework will be developed in 2018/19 while 70% of permits and licenses should be issued within the specified time frame.
For the inspectorate and regulatory compliance programme SAHPRA will in 2018/19 inspect 45% of establishments to ensure compliance with relevant good practices, standards and pre-defined timelines, while an annual target of 20% of all establishments of narcotic and psychotropic substances had been set. The programme on medicine and evaluation would account for 30.3% of the Authority’s expenditure with the bulk of expenditure on employee compensation and evaluator fees.
The 2018/19 budget for the Medium Term Expenditure Framework was set at R215 million which would be financed by fees and a transfer of funds from treasury. Spending on the compensation of employees was estimated at R149 million.
Ms Kopane asked if the Department absorbed all the staff from the previous entity. Could SAHPRA give a clear picture on the extent of the backlog?
Ms Thembekwayo sought clarity on the increase of fees to raise finances. Would it not lead to an increase in the cost of medicine, and if that was the case how would the vulnerable and poor access expensive drugs. On creating awareness of the mandate of SAHPRA, could the Department explain how the awareness programme would reach the general public, given that it had not mentioned any written products? The focus of the presentation had been on evaluation, but what about monitoring? Was there no necessity in monitoring whether previous programmes had been successful or not?
Dr Maesela sought clarity on the terminology of African traditional medicine. The nomenclature was unclear and connotations unsavoury. Why were African medicines traditional? It was confusing that everything on the document was a strategic objective. The Department ran the risk of having too many objectives and not achieving a single one.
Mr Mahlalela asked how much of the R215 million budget for 2018/19 was from revenue and how much was from transfers. For quarterly targets, how were percentages calculated because the cumulative percentage was difficult to interpret? For the unqualified audit outcome that the Department was expecting at the end of the year, what was the department going to do financially on a quarterly basis to ensure it got an unqualified opinion. Did the composition of the board include lawyers, HR practitioners, accountants, or IT experts as required by law?
Prof Rees clarified that the board comprised of members from other occupations as specified by law. The fee increase was far less than other comparable regulatory authorities in other middle income countries by a third. SAHPRA planned to hold discussions with industry stakeholders and carry out fair costing before it advertised fee increments. It was unfortunate that the cost had to be shared with stakeholders but the increment would not have an impact on the cost of medicine. The Department’s strategic objectives were based on a template provided by treasury and it would make sure all strategic objectives were met. The question of inconsistency in targets will be looked into by the Department.
Ms Nkambule confirmed that about 209 members of staff would be transferred to SAHPRA from the National Department of Health as negotiations were currently at chamber level. On the question of revenues, SAHPRA will generate R19 million in the first year of 2018/19 from application and retention fees while the Department would transfer R125 million.
Prof Shabir Banoo, Board Member, SAHPRA, explained that all applications before the 31st January 2018 were classified as backlog. The backlog was divided into new chemical entities and generic applications, with generic applications accounting for more than 90% of backlog. Multiple applications for the same product on generic medicine had contributed to the high percentage of backlog in generics. These multiple applications would largely be managed through an administrative process and did not need a formal review. Those that needed a formal review were however 2 090 while 1 500 applications were close to completion.
Dr Ushma Mehta, Board Member, SAHPRA, advised that the primary goal of creating awareness was to empower the public and health care workers to use medicine and health products optimally and safely. It was going to be a shared responsibility with stakeholders to expand the access to information. A public register of health products was going to be created and a dedicated communication unit was going to be established to answer media queries. It would also ensure SAHPRA had a strong web presence where information would be disseminated proactively on safety alerts, product recalls and risks associated with any new products. The support of partners such as the National Department of Health, pharmaceutical industries and academia was going to be quite strategic on the dissemination of information. Regulation guidelines would also be available on the website and a review of processes to include the public in decision making in South Africa was underway.
Ms Mandisa Hela, Vice Chairperson, SAHPRA, explained that good manufacturing practices, good distribution practices, good wholesale practices and good clinical practices were all anchored in monitoring. The inspection unit within the Department conducted factory visits depending on risks that emanated and looked into compliance of globally accepted standards, guidelines and practices. It further checked if manufacturers complied with processes outlined in their application dossier. Visits were also guided by information from members of the public and global alerts issued by regulators. Products identified to be unsafe were indeed recalled and put under quarantine where an analysis of distribution across the country was done. A new source of information from laboratories was being explored such as the National Medicine and Information Centre at UCT to get information on what patients were picking from medicine.
Ms Edith Madela, Board Member, SAHPRA, clarified that the term African traditional medicine was universally used by authorities in the field of Medicine, Health and other bodies such as the World Health Organization, African Union and the New Partnership for Africa's Development. The term was used to differentiate indigenous African medicinal products and practices from those that come from China, India and other regions. Comments by the committee had however been noted and would be included for discussion with the interim African Traditional Practitioners Council of South Africa to propose better terminology. SAHPRA only regulated products made for commercial availability and not all African traditional practices.
Prof Craig Househam, Board Member, SAHPRA, agreed that an unqualified opinion did not just happen at the end of the year but was part of a process of ensuring monthly and quarterly targets were met. SAHPRA was still new and had to appoint a CFO, but once it was properly constituted and formulated, it would have the capacity to ensure a clean audit was achieved.
Prof Rees also confirmed that SAHPRA was in the process of advertising for key senior positions but this process was not yet complete due to the various requirements from the Department of Health and the Department of Public Service and Administration (DPSA).
Dr Maesela raised concern on the frequency of factory inspections that happened once a year or once every five years. What about toxic substances that were generated in bulk and not found in time? Professionally, such instances must be guarded against especially with the recent incidences of listeriosis.
Dr. Henry Leng, Board Member, SAHPRA, assured Members that the process of evaluation captured the manufacturing of drugs, and tests were carried out to ensure controls on quality, safety and efficacy were followed.
The Chairperson reminded the Board of its responsibility to ensure safety of everyone including those in rural areas. The sensitivity of the language used by the Board must therefore be reader friendly to ensure that SAHPRA communicated with the public. Communication to people and stakeholders was important to ensure the public was not exposed because it was already vulnerable. She thanked the Department for attending the meeting and was grateful for an institution that was going to look into a number of issues raised by the Committee.
The meeting was adjourned.
- SA Health Products Regulatory Authority (SAHPRA) Annual Performance Plan; Health Department APP: analysis 2
- SA Health Products Regulatory Authority (SAHPRA) Annual Performance Plan; Health Department APP: analysis 1
- SA Health Products Regulatory Authority (SAHPRA) Annual Performance Plan; Health Department APP: analysis 3
- SAHPRA; Strategic Plan (2018/19-2022/23) Annual Performance Plan (2018/2019)
- AGSA; Annexure to the Review of the 2018-19 Annual Performance Plans (APPs)
- AGSA briefing: Review of the 2018-19 Annual Performance Plans (APPs)
- Financial and Fiscal Commission: Briefing
- Department of Planning Monitoring and Evaluation; Review of the Health Sector’s Performance against the medium-term strategic framework (MTSF) 2014-2019
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