NEHAWU+on+MTBPS



=NEHAWU’s response to the MTBPS, 2007=

31 October 2007
The National Education Health and Allied Workers’ Union (NEHAWU) notes the Medium Term Budget Policy Statement as announced by the Minister of Finance, Trevor Manuel, in Parliament yesterday. NEHAWU’s response is as follows:

1. NEHAWU views the repeated annual claims by Treasury on revenue “underestimation” as a ruse towards entrenching surplus-budgets as a norm. In this MTBPS, the Minister justifies the planned budget-surpluses over the next two financial years on the basis of the notion of the “cyclically-adjusted budget balance” – which has been promoted by the so-called “Harvard panel” that advises government on Asgi-SA. These additional resources that are primarily derived from the current upswing in the international prices of metal resources could have been used to change the structure of the economy so that in future economic growth would not be so heavily dependent on the mining sector. However, part of this surplus is derived from the persistent problem of under-spending in provinces as reported in the Provincial Budget and Expenditure Review by the Treasury. This is despite inadequate staffing especially in hospitals and schools - a factor that also significantly contributes to these celebrated surpluses.

2. We welcome the fact that health expenditure is projected to grow over the current period of the Medium Term Expenditure Framework. However, this occurs in a context of a skewed pattern in the deployment of the country’s resources - which is reinforced by the government’s drive to introduce the Social Health Insurance. In the current financial year South Africa’s spending on health services amounts to about 8,5% of GDP, the big slice of which - 5% of GDP - caters only for about 7 million people who have medical insurance. Whilst the rest of the population, more than 37 million people, endures the crisis-ridden public health service that only receives the residual 3.5%. Hence, NEHAWU calls for the introduction of the National Health Insurance in line with the health policy of the African National Congress.

Further, we are concerned that in the financial year ending on the 31st March 2007 there has been an overrun of R385.004 million in the provincial health budgets. Yet, according to the Department of Health, currently provinces are reporting vacancy rates of up to 40% in certain categories of health personnel.

3. Whilst we welcome an additional allocation of R4.3 billion over the MTEF period for pensioners and other social grant beneficiaries, in reality over the past three years allocations to the Child Support Grant (C.S.G) and old-age pension were below food-inflation and barely linked to the CPIX. Once again, NEHAWU is dismayed by the lack of further announcement on the extension of the eligibility threshold of the C.S.G beyond 14 years, as promised by the President in the 2007 State of the Nation Address. We therefore call for the extension of the C.S.G. to 18 years, in line with the Constitution.

The fact that the Minister claims that “national income has risen by 22 per cent per person since 1999, with increases across all income groups” has no relevance to million of the unemployed and extremely poor, who have no income at all. In this connection NEHAWU reiterates its call for the Basic Income Grant.

Issued by NEHAWU Communications Department
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