The Gauteng Department of Health (GDoH) failed to spend R1.1-billion of its 2023/24 budget.
This was revealed by the head of the department, Arnold Malotana, at a meeting last week of the Gauteng legislature’s Health & Wellness Portfolio Committee. The department was allocated a budget of R60-billion for the 2023/2024 financial year.
“It is a highly, highly undesirable way to run a health department,” said the DA’s Gauteng health spokesperson, Jack Bloom.
Bloom said that at the committee meeting, Malotana revealed that the GDoH had applied to Treasury to roll over R780-million of the unspent money into this financial year, but approval had not yet been given.
This meant that at least R320-million of last year’s budget had been lost, and potentially a lot more if Treasury did not approve the rollover, said Bloom.
Reasons for underspending
The Gauteng health portfolio committee chair, Ezra Letsoalo, said there were several reasons for the underspending.
“It really has to do with the [in]ability of the department to manage its financial systems. Primarily, you have got challenges pertaining to financial controls and distribution towards financing some of the programmes,” he said.
Letsoalo also cited a lack of proper planning and issues with the supply chain process, including poor financial controls, planning deficiencies and supply chain delays.
“The acquisition of a specific product and running of specific processes then obscures the quick attainment of those specific outputs. It is actually quite subversive that one contract … can take anything between three to six months to finalise in terms of evaluative as well as adjudicative process,” he said.
The department’s efforts to reduce medico-legal claims had resulted in funds being redirected, which could also have contributed to the underspending.
Letsoalo noted that there had been a reduction in underspending over the years. The department allegedly failed to spend R2.7-billion of its 2022/23 financial budget.
“In a nutshell, it’s about having compromised or even poor financial planning systems in place. The department might also have to look into attracting greater skilled personnel, especially within the finance unit and including those that are responsible for programmes and management,” he said.
“Every programme has a manager, so at some point we must ponder the effectiveness of some of the managers in executing their programmes relative to the budgets they are allocated.”
‘Degree of negligence’
The underspending has had impacts on ongoing health projects and critical services such as cancer treatment. Bloom said it was likely that most of the R250-million budgeted last year for urgent cancer treatment had not been spent — it is the subject of an urgent court application by the Cancer Alliance.
“They [the GDoH] were supposed to do a contract with the private sector to treat the patients because they don’t have state resources. They are short of radiation machines and these patients need urgent treatment. All they’ve told us is that they’ve got a planning contract with Siemens for R17-million,” he said.
“Urgent treatment is urgent. These are patients who should have already been treated. It is just plain incompetence that [the GDoH] didn’t spend the money in the proper year and didn’t spend it urgently. I think people are dying as a result and I think there’s a degree of negligence here,” he said.
Letsoalo acknowledged that the delay in radiation treatment for cancer patients was a blight.
“The thing about the healthcare sector is that we are dealing with lives, so any delay whatsoever implicates a life. We are seeing that [underspending] implicates the quality of the provision of health services,” he said.
“Radiation oncology is one of those, but we’ve also detected that even for maintenance for some of the facilities there is a bit of underspending there and we are quite concerned about that.”
Letsoalo emphasised the critical link between quality health services and adequate infrastructure.
“Without functional health facilities equipped with essential machinery and medicine, it’s actually quite deleterious. It’s aggressive, it’s regressive and it undermines the ability of the health system to address the healthcare needs of our communities.”
He noted that despite significant spending on emergency medical services, funds had been underspent which could have significantly improved service provision.
Chronic underspending by the department
Matshidiso Lencoasa, a budget researcher at SECTION27, said the Gauteng Department of Health had for years been notorious for its underspending.
“Underspending is something to be concerned about because it means that the resources we’re trying to mobilise so that we can fund healthcare and the constitutional rights to access quality healthcare services, there is a gap,” she said.
“It is a concern because it means that the money isn’t going where it should be, and the money is likely returned to Treasury and it doesn’t get spent towards advancing the rights to quality healthcare, especially in a country which is struggling to actually advance some form of universal health coverage.”
Lencoasa said underspending was a systemic issue.
“There will be projects that are assigned budgets and the budgets are approved, but then the projects don’t actually reach completion or reach the stages that they should in that year and then government has no choice but to send the money back to the national department,” she said.
“Treasury should be thinking about investing [funding that gets returned] to bolster our capacity to hire people who have the qualifications and the expertise to spend this funding for healthcare realisation,” said Lencoasa.
“When underspending does happen, there doesn’t seem to be consequences for that, even though it does impact the right to access healthcare.”
It was typical for Treasury to cut budgets, especially in healthcare, in areas where there was underspending.
“Theoretically, you think that would make sense, because that budget is not being spent, so that money should be going towards a department that can spend it. Unfortunately, that kind of approach punishes the healthcare users, because they’re not the ones who underspent the money and they do need quality healthcare services.
“That’s why it’s really important for departments to work together and to have a consistent message about realising the right to healthcare access. Budget cuts should not be used as punishment, because they don’t arrest underspending, they just punish the ordinary person,” said Lencoasa.
Letsoala said enhanced financial controls were needed. He added that the health committee had asked the department to develop mitigation plans and that the department had indicated it was working on a turnaround strategy, especially in areas of concern that the committee had raised.
Areas of concern included delays in oncology treatment, maintenance of health facilities, provision of goods and services, the overpopulation of patients in some health facilities and the slow roll-out of information and communications technology infrastructure.
By the time of publication, the GDoH had not responded to Daily Maverick’s request for comment. DM
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