Parmed Report

Ad Hoc Committee on Parliament and Provincial Medical Aid Scheme

07 November 2018
Chairperson: Ms L Maseko (ANC), Mr P Parkies (ANC, Free State)
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Meeting Summary

Documents Handed Out: Draft Report of the Ad Hoc Joint Committee on PARMED; Economic Freedom Fighters Written Submission to Ad Hoc Joint Committee on Parmed Act; Economic Freedom Fighters and Others v Speaker of the National Assembly and Others (5554/2015) [2015] ZAWCHC 184; [2016] 1 All SA 520 (WCC) (8 December 2015)

The Sub-Committee on Parliament and Provincial Medical Aid Scheme met to discuss its report on the Parmed Act.

The EFF had raised concerns and objected to the PARMED Act due to its unaffordability and compulsory association. The Ad Hoc Committee had been jointly established by the National Assembly (NA) and the National Council of Province (NCOP) to inquire into the Parliamentary and Provincial Medical Aid Scheme (Parmed) Act 28 of 1975 and to decided whether to continued with it or not. As part of the process, the Committee engaged with various stakeholders.

Members noted that the report was a fair reflection of what had been submitted and discussed. They also observed the EFF’s submission had been excluded and requested that this be rectified.

Members were informed that implications from the EFF submission were captured in Option One and Two. Option One dealt with amendment of the Act to make membership voluntary. The essence of the EFF’s submission dealt with that. Another option that comes strongly from the EFF’s submission was the repealing of the Act as Option Two. The discussions of the Committee had been also captured in Option Three and Two in terms of amendment. It was further highlighted that the options were contradictory in that one called for the amendment of the Act and the other called for the repealing of the Act.

The Committee noted that the topic of the salary of Members versus the inflating cost of PARMED membership and indicated that this should be captured in the options.

The full Adhoc Committee was expected to meet the following to consider the report. The Secretariat was instructed to compile and provide documents to all Members concerned. Members of the Sub-committee were asked to lead discussions with their respective party Members.

Meeting report

Opening Remarks

Chairperson Parkies opened the meeting. He said that there was one agenda item:  to consider and discuss the report as it was. He had instructed the officials to distribute the draft report to all Members of the Ad hoc Committee the previous day; not only those in the Sub-committee. He suggested that there be a meeting with all the Ad Hoc Members the following week, it would be the final meeting of the Committee.

He read out the apologies for two absent Members.

Parmed Report

Chairperson Parkies asked that the Members expressed their views on the report as they should have studied it by now. It was requested that when the officials composed the report that they were thorough in capturing all the information that had been presented to the Sub-committee so that the other Members would not be denied any knowledge from the different stakeholders’ inputs. Fundamental points and inputs should have been captured in the report. He asked for the guidance of this Committee to say how they would approach this report. Thereafter recommendations could be given.

Mr S Marais (DA) said that the report was a fair reflection of what had been submitted and discussed.

Dr S Thembekwayo (EFF) agreed with Mr Marias as it captured all the information as it was presented but it only contained information from the outside stakeholders and excluded what had been submitted by the EFF. She asked if she could speak on where she had observed some errors of grammar and spelling or if she should hold that until the Committee went through the report page-by-page.

Chairperson Parkies said that he had asked for the Members guidance on whether the Committee should review the report page-by-page or go straight into the recommendations. The main body of the report captured the information and interactions that were had by the Committee. He said that the submission of EFF must be captured in the report; it could not only contain the submissions from outside stakeholders.

Mr Marais said that if there were mistakes like typing errors it should be sent through and focus in this meeting should be kept on the crux of the report.

Mr Ludumo Sishuba, Committee Content Advisor, said that the legislative implications from the EFF submission were captured in Option One and Two. Option One dealt with amendment of the Act to make membership voluntary. The essence of the EFF’s submission dealt with that. Another option that comes strongly from the EFF’s submission was the repealing of the Act as Option Two. The discussions of the Committee had been also captured in Option Three and Two in terms of amendment. That’s how the essence of the presentations had been framed and integrated.

Chairperson Maseko apologised for her late arrival. She said that a paragraph that highlighted all that was said in the submissions was needed and the EFF should feature in such. She continued that instead of starting with the mandate as the first item in the report, there needed to be an introduction that highlights how the Committee was constituted and what its mandate was then should follow.

Chairperson Parkies agreed with Mr Marais that the focus should remain on the body of the report. He suggested the Committee go straight into the legislative options section of the report.

Mr Marais referred to the meeting in which the Judicial Committee made a submission. He recalled that a lot of the discussion then was surrounding Option Three where it speaks of the affordability and how the affordability was negatively impacted by Judge Moseneke who decided the Cost to Company needed to be changed, and subsequently the salary increases were no longer in line with the increases of the cost of PARMED. An alternative for this Option was that either the Minister of Finance or National Treasury must be prepared to make a once-off contribution to basically bring the salaries in line with the cost of PARMED membership. Secondly, the Remuneration Commission should consider recommendations from the Members to only deduct one third of the cost from the salary and have the other two thirds as a contribution from the employer. Feedback from the Finance Minister, National Treasury and the Remuneration Commission was important.

Chairperson Parkies said that under the remuneration and medical cost section in the report what Mr Marais stated was highlighted. Perhaps this paragraph should be placed right above the recommendations to say that on the basis of that (the remuneration and medical cost), these were the recommendations.

Chairperson Maseko said that salary increases were not in line with the increases of the cost of PARMED membership. This was another contributory factor.

Mr Marais said the option here was that either this would be accommodated by the Remuneration Commission or a once-off contribution towards bringing these in line. This was not a bad medical aid; the problem was the affordability of it.

Chairperson Parkies said this should be the first recommendation. The topic of the salary of Members versus the inflating cost of PARMED membership was captured in the report but should not be left as a useless paragraph. It must be brought into the Options of recommendations by linking how it related. People forget that Members of Parliament are human with their own families who were also affected by inflation that the country experiences. He added that the implications of the structural changes made by Judge Moseneke must be explicit in the report.

Dr Thembekwayo asked if this once-off contribution proposed would be taxable because it was then that the tax would be 45% and it would not be enough to help.

Mr Marais said that the consideration of all the impacts must be fully inclusive. The tax implications must be built into it. He added that the last paragraph in the section dealing with remuneration speaks of the period between 2008 and 2014. It must be brought up to 2017 as there was a year post-2014 in which there was a 0% salary increase.

Chairperson Maseko agreed that the discrepancy should be right up to 2017.

Mr Sishuba said that the officials could try to match what was written in the remuneration section to the information the graphs on PARMED’s financial health. It does include the 0% increase of 2016.

Dr Thembekwayo said that the anticipated cost increase of PARMED for 2019 must not be forgotten as it would have a great impact on the salaries earned.

Chairperson Maseko said that it could also be assumed that there would not be a salary increase for 2019 as there has been no news of such yet.

Mr Marais said that he believed that the possible salary increase was sitting with the President at the moment.

Chairperson Maseko said there was meant to be a meeting on 7 November of the Members Support Facility but it had been postponed to the following week. The salary increase issue could be raised then.

Chairperson Parkies said that whatever Option was taken would inform the direction and position for the way forward. He did not have an issue with the substance of the report but said he did not like that there were many options that Judge Musi must choose from.

Chairperson Maseko said that parallel processes were taking places. The Committee could not report to Judge Musi before reporting to the House that constituted the Members. Once a recommendation was adopted by the House it would become a resolution and would be binding.

Mr Sishuba said that the recommendations contradicted each other and that was the only issue he saw within the report.

Chairperson Maseko asked how the recommendations were contradictory.

Mr Sishuba explained that the options were contradictory in that one called for the amendment of the Act and the other called for the repealing of the Act. The problem with the option that dealt with remuneration was that it was buying into the continuation of the Scheme as it was.

Mr S Tleane (ANC) apologised for arriving late. He understood the logic of what Mr Sishuba had said. Solving this problem was not something that was going to happen as an event as there was a variety of elements that caused it. This has made it difficult to make one recommendation that covered all the problematic aspects relating to PARMED. The reason there was multiple options was that it was predicated by a variety of issues. The report would inform Parliament in its entirety in taking a decision on the route to take. What the Content Advisor was saying should be captured in the report to briefly explain the dilemma of presenting multiple options to Judge Musi. The solution to the problem was not in the hands of the Committee, it was in the hands of many people.

Dr Thembekwayo concurred with what was being said. She said it must be kept in mind that it was easy for the Members to understand the report as they had been there at each stage of its development. This was not the case for the rest of the Members of Parliament and so more information presented in the report to them would be best.

Chairperson Parkies said this was a very good and professional report. He asked the Committee Secretary to compile a package with all the submissions that were presented to the Committee and to place this in all the Members’ pigeons hole’s so that they could each have the chance to review everything for themselves. It would be the responsibility of each Member to study that before the discussion in the following week took place.

Dr Barbara Loots, Legal Advisor, Parliament, asked the Committee for allowance to compile the report in a similar fashion to which Lawyers write reports for Judges when asking for certain considerations. It would involve the option where consideration and actions made by the Treasury, the Finance Minister and the Remuneration Commission solved all the issue to make membership affordable. That would be scenario one. Thereafter the options to repeal or amend the legislation would come in as scenarios two and three.

Dr Thembekwayo said that the Committee could not just speak of the remuneration. All the input from stakeholders that was given would then go to waste. The report must be all inclusive of the options.

Mr Marais said he liked the idea that that scenario one gives a specific proposal that would be the solution to all aspects of the problem at hand. The Committee does not have the luxury to interrogate the President and Judge Musi.

Chairperson Parkies said that substantively all the Members of the Sub-committee were in agreement.

Chairperson Maseko said that a key issue was the constitutionality of the Act. It was unconstitutional for the Act to make membership to PARMED compulsory. Another key issue was that the cost of membership was unaffordable. Public Officers Bearers and stakeholders had made submissions and showed themselves to be interested in joining membership to the medical scheme if it were to be made affordable.

Mr Tleane said that it was crucial that sustainability be considered in the resolution of this problem. The report must contain all of the options until a consensus has been reached by all Members of Parliament.

Chairperson Maseko said that she had just realised that there had been no engagement with the continuity Members to PARMED.

Chairperson Parkies said that all submissions must be captured as it was presented. He asked if the willingness of the stakeholders engaged was included in the report. He was not comfortable with how it was implied in the report in the third legislative option that it was the idea of the judiciary.

Mr Sishuba said that the willingness of the stakeholders to join had been included.

Chairperson Maseko said it would be important for the Members of the Sub-committee to lead discussions with their respective party Members. She thanked the Committee for its hard work and dedication.

The meeting was adjourned.                                                   

 

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