Department of Health on its 2013/14 Annual Report; Audit Outcomes: AGSA briefing

Meeting report

Presentation by Auditor General of South Africa (AGSA)

Ms Corne Myburgh, Senior Manager, AGSA, said that it was the AGSA’s task to enhance the supervision and oversight work of the Committee. The Committee should be involved in strategic planning, performance management and annual performance plans (APP’s), and should consider whether these are in alignment with the NDP, whether the financial and human resources are available for these plans, whether the targets are realistic and how these targets will be achieved. The latter should be tracked through reviewing the progress of entities on a quarterly basis and by reviewing annual achievement of objectives and any changes that might occur throughout this process.

Ms Myburgh told the Committee that clean administration could be achieved only through a convergence of components which included robust financial performance management systems, independent and relevant reporting by the AG, commitment and ethical behaviour, and oversight and accountability by all.

Accountability and remedies to address transgressions and poor performance were clearly outlined in the AG booklet.

Audit outcomes for the health portfolio were reported on for the National Health Laboratory Services (NHLS), the Council for Medical Schemes (CMS), the National Department of Health (NDOH) and the Medical Research Council (MRC). These were assessed on three outcomes: financial statements, compliance with legislation and performance reports. There was one audit outstanding from the Compensation Commissioner for Occupational Diseases (CCOD). Previous years indicated similar challenges, where information was not reliable and they received a qualified report and a disclaimer. The Minister had been involved in implementing interventions with regard to skills deficiencies and improved internal controls.

The other four entities all received unqualified reports.

Regarding performance reports, the NDOH received one adverse finding, based on deficiencies in internal processes. Assessments on the level of compliance with legislation affected four entities, with one audit still outstanding for the CCOD.

The Committee was told that irregular expenditure amounted to R11 million for 2013/2014, compared to R6 million in the previous year. Fruitful and wasteful expenditure was down significantly, from R660 000 last year to R59 000 during 2013/2014.

Key risk areas indicated that the NDOH and HHLS needed intervention in terms of the quality of their financial statements, the NDOH in terms of the quality of their performance reports and the CMS in terms of its supply chain management. The financial health of the NDOH was concerning as a result of under-spending on conditional grants and infrastructure, while the NHLS experienced cash flow constraints as a result of outstanding debt from KZN and Gauteng.

Various drivers of key controls were measured according to leadership, financial and performance management and governance. The root causes for negative findings were indicated as lack of consequences for poor performance and transgressions, slow response by management and compliance with legislation not being reviewed and monitored.

Discussion

Mr A Mahlalela (ANC) wanted clarity on the indication that NHLS was the only entity doing well on IT, yet in the same presentation the MRC had received a “good” finding for IT governance. He asked about the fruitless and wasteful expenditure of CMS. He asked if there was a way to address challenges, prior to audit. The audit should not come just at the end of the process and indicate that the performance information was not SMART, as the problem starts from the adoption of the APP. The AG should find a way of continuously interacting with departments so that when APPS were finalised, they will be SMART. He asked if the AG could assist Members, because APPs went through Parliament and if an APP was not SMART, it means Parliament had not performed its duty from an oversight perspective. It had allowed the APP to be adopted whilst it was not SMART. The AG had noted that the previous Committee did not deal with the APPs and strategic plans of departments. He asked how the AG arrived at this conclusion, and whether it checked Parliamentary records or not.

Dr P Maesela (ANC) asked the causes for the increase in irregular expenditure and the decrease in wasteful expenditure.

Mr N Matiase (EFF) said the presentation lacked coherence, and the AG should improve on colouring used on the slides for the Committee to have a good grasp of their meaning. The fact that irregular spending indicated a lack of fairness and transparency, and stating that value was obtained, leaves the back door wide open for transgressors to go away. The risk areas and drivers of key controls did not correspond to each other.

Mr A Shaik Emam (NFP) asked how the AG understood the concept of value for money, as there seemed to be confusion on the meaning of irregular expenditure. The AG based its definition of irregular expenditure on the documents provided by the relevant departments without looking at whether the procured goods were necessary or not. He asked if the Committee was expected to make an input on the strategic plans of departments, and to what level. He asked what the Committee could do in terms of consequences for those who were not complying, or to make them compliant. He was concerned with the jump from R6 million to R11 million in terms of irregular expenditure, which clearly meant that there was a lack of consequences. If there had been irregular expenditure that was not accounted for, there must be consequences. If there were no consequences, it would continue. Even though the AG was not responsible, who was going to ensure that there were consequences and recommendations were acted upon. Interventions were being recommended, year in and year out -- who was ultimately responsible for ensuring that interventions were put into practice? There was a need to take control of these issues before the media started reporting on them so as not to get negative publicity, as it sounded like nothing was happening.

Ms C Ndaba (ANC) asked what the AG does if it receives late submissions. He asked what the AG does to ensure that information submitted was useful, and how the Committee can ensure that departments submit useful and reliable information accordingly. She asked what the AG does in the case of departments not submitting reliable information, as the Committee can not make follow ups -- it was the AG that did the monitoring and auditing

Ms Pillay replied that the statements that IT was a key control and a driver of risk areas were different, and this was assessed differently. This means that the MRC had IT in place, but it was not as operational as expected. The briefing notes given to the Committee showed the reasons for the increase in the fruitless and wasteful expenditure. For the NDOH, wasteful expenditure was mainly a result of no-shows for training. The AG assesses the reliability of information given to it. The AG assists entities by doing pre-audits where possible, prior to the statements being tabled, and presents its pre-audit findings to management. Unfortunately, during the current year, this had not been possible because of the elections. The AG cut-off date for submissions was 31 May, but late submissions were accepted until to 31 July. It was the primary role of the AG to highlight where information was not reliable, pinpointing weaknesses and deficiencies, which management should then use to draw and develop action plans. The actions plans were also assessed. These were presented to the executive and at cluster level, and to the Committee as well. The NDOH faced considerable challenges in gathering information from some 3 500 facilities across the country, as the information was captured manually. The management at national level was significantly involved in reviewing its internal controls, policies and procedures in this regard in consultation with the AG. There were action plans in place, but there was a need to understand how long it will take to resolve this. The Committee was assessed in yellow, because it was felt that the Committee did not consider and interrogate the APP when it was tabled.

The Chairperson asked how the AG was involved in the drafting and the approving of APPs.

Ms Pillay replied that the AG was involved significantly in the drafting of the 2014/15 APPs. Pre-audits were done to ensure that targets were SMART, and recommendations were made available in February and March. The APP was tabled prior to getting input from the Committee.

The Chairperson demanded a further explanation on the role of the Committee on APPs. The AG had rated the previous Committee yellow. It was therefore important for the Committee to have a clear understanding of its role so that it did not repeat the same mistake as the previous Committee.

Mr Mahlalela also wanted an explanation on the role of the Committee. The budget could be approved only once the APP was approved, and not the other way round. It was impossible that the previous Committee had not discussed the APP and strategic plan before approving the budget. He did not understand the explanation from the AG.

Mr Shaik Emam said the AG had recommended that the Committee be involved earlier in the APP process, before the APP was tabled. He asked what the AG’s office was doing to ensure that the Committee was part of the APP process before it was tabled.

The Chairperson said her understanding was that the Department prepared the APP and it then comes to present it to the Committee. The AG was implying that the Committee was supposed to be part of preparing the APP. The Committee could not be part of that, as it was responsible for oversight.

Ms Myburgh replied that it was correct that the departments were responsible for drafting the APPs. The AG received a draft APP usually in January, reviews it and communicates its findings to the Minister. The AG has in previous years presented it to the management of departments before it was submitted to the Committee for review and approval. The Committee could invite the AG to share its findings. However, this had been difficult this year because of the elections, but the Committee should in future invite the AG to share its concerns.

The Chairperson asked whether it was up to the Committee to invite the AG to present the findings of the draft APP and pre-audits to them.

Mr Jan van Schalkwyk, Corporate Executive: AGSA, replied that that involvement of the Committee can begin much earlier in the process. By January, the coming year’s budget and APP were pretty much complete. The October adjustment budget was approved, necessitated by changes to the APP. The Committee can start involving itself with 2015/16 APP and budget from now onwards. In September, departments submit budget estimates. This is not done if the APP is not ready, because the two move hand in hand. This must come to the Committee, as a budget adjustment can not be made without changing the APP. The APP of 2014/15 was approved by the beginning of the year by the legislature, and the Minister and then the Department go to comply with the requirements. As departments were looking for a review of the current year, they submit their budget estimates, which cannot happen without looking at the APP. The APP for the 2014/15 financial year was approved by the previous Committee and then submitted to the Minister in January, before the budget speech. Part of that day’s briefing was to brief the Committee on what changes need to be made to the APP for the current financial year, as adjustment budgets were being made, as well as briefing the legislature on changes that need to be done on next year’s APP. By January, the Minister would have already have started with the budget.

Ms Myburgh added that the level of assurance expected from the Committee was not comparable to that expected from senior management, which was responsible for the day to day control. The Committee must highlight important areas and monitor strategic plans of departments. The AG cannot enforce consequences -- it was the main responsibility of the accounting officer. The accounting officer has a responsibility for the entity, and he/she must enforce the consequences. In terms of oversight, the Committee can then ask what the consequences were, and what the outcomes were.

The Chairperson said if the AG picked up particular patterns, and a particular department’s accounting officer was not implementing the recommendations, what was the recourse for that

Ms Myburgh said that the AG makes recommendations, but it was not its mandate to implement them. The accounting officer must investigate and take appropriate action. The AG audits procurement in compliance with the Act that guides procurement, and any deviation from it was irregular expenditure. It then makes an assessment on whether value for money was achieved. In the majority of the cases, the service was provided but the department did not go through the process to ensure that everybody had a fair opportunity to tender or provide a specific service required. Even though the service was provided, procedures were not followed and there must be consequences. It was not just about whether the service was received, but whether the Act was contravened. The matter relating to the non-payment by KZN and Gauteng was being resolved, as the provinces were questioning the invoices submitted.

Presentation on Audit Outcomes for Health Sectors

Audit outcomes of the sector indicated three unqualified reports and seven qualified in terms of financial reports. The performance reports of nine sectors were given findings, while only the Western Cape had no findings. This was as a result of strong controls and good daily and monthly monitoring processes in place and being implemented. Movement in audit outcomes indicates a slight improvement in Limpopo, which had moved from a “disclaimer” to “qualified with findings”. The rest of the sectors showed no change.

Qualification areas and material corrections were broken down per province. These indicated that Eastern Cape, Free State, KZN, Mpumalanga and Northern Cape were given qualifications, and Limpopo and North West had made material corrections. Inadequate systems to account for assets, as well as not regular assessment of assets, accounted for the same provinces, with the exception of Eastern Cape, receiving qualifications on this score as well. There was no late submission of annual reports, but in three provinces information provided was not useful. These were Limpopo, Mpumalanga and Northern Cape. The extent of unreliable information submitted was 90%. This was partly attributed to the manual systems still largely in place across the provinces. All provinces struggled with material misstatements in their annual financial statements and all aspects of compliance with laws and regulations. The only improvements indicated were in HR management and compensation. Irregular expenditure totalled R7.1 billion, up from R6.2 billion the previous year, but fruitless and wasteful expenditure amounted to R289 million, down significantly from R605 million the previous year.

The root causes for these findings were listed as lack of consequences for poor performance and transgressions, a slow response by political leadership and senior management in addressing these causes, as well as instability or vacancies in key positions and lack of leadership cohesion between the national and provincial departments of health.

Discussion

Dr W James (DA) asked for a breakdown of the extent of irregular spending and wasteful expenditure, by province. The lack of consequences for those responsible was also a governance problem, as the Minister did not have direct control. The Ebola Readiness Fund required R263, to which the government was contributing only R33 million. This was a very serious challenge, considering the amount of money lost through irregular and wasteful expenditure.

Mr H Volmink (DA) said the figures of irregular and wasteful expenditure were depressing. Complying with legislation was a problem across all sectors. 8,7% of GDP was being spent on health, and with these poor outcomes, something must be done about it. The Committee had a constitutional mandate to ensure that action was taken. Parliament was often accused of making laws which cannot be implemented. He asked what had made Limpopo to progress from being very bad, and what could be learnt from that. He asked if the AG interacts with the Department of Planning Monitoring and Evaluation to ensure that there was improvement in departments.

Mr Mahlalela asked what the difference was between supply chain management and procurement. He asked about the status financial health in various provinces, and for the reasons for under-spending on conditional grants.

Ms Ndaba said the Committee engaged with the Department on remedial ways to improve irregular, unauthorized and wasteful expenditure. The Department needed to explain to the Committee how they were going to address these problems.

Mr Matiase asked why the Free State required urgent intervention to address its financial health. What was the magnitude and gravity of the problem in the Free State, as it had attracted a lot of public protests over the last three years.

Mr Shaik Emam said since interventions were needed in all areas, he asked the AG enlighten the Committee on the kinds of intervention and recommendations the AG had made over the past two years.

Dr Maesela said there might be something wrong with the funding model, which needed to be changed since the same patterns of irregular expenditure in procurement were reported every year. There was a need to look at the funding model to ensure that there was strict accountability so that there would be no room for wasteful expenditure and corruption.

The Chairperson asked why the Western Cape still formed part of the list of provinces with unauthorised and irregular spending, if their processes of performance reporting were good. She asked if fruitless, irregular and unauthorised expenditure was caused by systems that were weak. The AG must also provide a breakdown of information on the extent of the problem per province.

Ms Myburgh replied that detailed information would be tabled in November with regard to the individual provinces. Limpopo had been assisted by the National Department of Health over the last year and was able to improve. It still needed a system to manage patient fees.

The problems found centred on the lack of consequences. The AG looks on the quality of financial statements, procurement and quality information. Employees need to sign performance agreements so that they could be held accountable to their performance. The AG does not play role with regard to the funding model, it was the responsibility of National Treasury. Supply chain management and procurement were closely linked, and were separated only in respect of the sources of legislation. The AG did not have findings in the performance report of the Western Cape. It was performing better than other provinces because it had improved its internal controls. A detailed report on the extent of irregular expenditure in provinces will be tabled later.

Mr Van Schalkwyk added that their auditing work was in aid of oversight. It assists Parliament and the Committee by giving it actual information. The AG does not implement consequences. The AG looks at compliance with the Act, in particular chapter 10 of the PFMA, which describes financial misconduct. The Minister, MEC’s and the Department must implement consequences. After the AG presents to the Committee, it should then ask questions on what had been done. The performance information of many provinces was in crisis. In certain instances, departments had overspent their budget by 10% and achieved 60% of their targets. The Committee approves the APP, approves the budget, and gets feedback from the Department on the progress in implementing the APP. If the AG raises problems with the reliability of performance information, that means that the Committee must ensure that it gets the right information from provinces, so that when it goes there, it can verify it. The Committee has the right to ask all the questions, as the AG can not do oversight.

Ms Myburgh said that at this time of the year, the previous Committee invited the Department of Perfomance, Monitoring and Evaluation to present to the Committee. She recommended that this Committee also invite it. The financial health would be explained when the full report was tabled.

Mr Van Shalkwyk said that the APP was done in such a way that Parliament could approve it. The Committee can decide on what it wants to see, including quarterly targets. However, certain targets are written in such a way that they can only be measured once they are done. This was mainly common in municipalities, such as the tarring of roads. However, this can be measured quarterly by ensuring that the right people were contracted. The municipality must put adverts in newspapers to appoint people. These were the things that needed to be done before the road was tarred. This was why the structure of the APP must be in such a way that the targets were SMART, so that they can be monitored in a quarterly basis. It would be difficult to monitor if the target did not have clear time frames. The Committee must make comments on the kind of plan it wants to see, before it comes to the AG

The Chairperson thanked the officials from AG and looked forward to welcoming it again in November.

Presentation by Treatment Action Group

Mr Anele Yawa Secretary General, TAC, said the public health system was in a state of collapse. While health care was a constitutional right, as per Section 27, to have access to good health services in providing for a long and healthy life, no such privilege was being accorded the poor in this country. The Minister was being thwarted by MECs who dragged their heels when it came to addressing the health challenges facing the country. Community health workers, while at the forefront of dealing with these challenges, were being excluded from the system and were not being treated fairly.

Ms Thokozile Madonko, Co-ordinator: Budget and Expenditure Monitoring Forum (BEMF), said in the Free State the health system was in crisis, and that similar challenges were being faced in the Eastern Cape and other provinces. The Minister of Health needed a national strategy to address the delivery of health services in the provinces. Expert teams would be needed to institute interventions, possibly with the assistance of an investigative unit which could integrate their findings into a diagnostic tool, which could raise red flags in the system well before situations arose such as those taking place in the Free State, where there were regular stock-outs and shortages of medicines. These shortages were leading to a major crisis in health, since it jeopardized adherence to on-going treatment. There was a disparity between what was being approved by the Committee and what was happening on the ground. She strongly urged the Committee to visit the Free State to see for themselves the state of health services in that province, which was dire. People were dying.

Ms Madonko made the following recommendations:

• The passing of the draft Bill for National Intellectual Property Policy.
• he medicines regulator should continuously and proactively publish information on medicines, and whether they have been registered, submitted for registration or rejected. This would allow people greater access to better and more affordable medication and would speed up the process of registration and rejection of medicines. The body responsible for this needed to be independent of industry and government.
• The Department needs to finalise a policy for National Community Healthcare workers regarding their remuneration and their training and development. They were the foot soldiers of the healthcare system, yet at present their role went unrecognised and in many cases unrewarded. They played a vital role in the community and households. They had no contracts and therefore no security. They were not even recognized as forming part of the human resources of the Department. Such changes needed to be instituted in consultation with the community healthcare workers themselves, as well as civil stakeholders 
• The Committee should request more detailed and periodic updates on the state of the HIV treatment programme, which included viral suppression rates by province, district and health facility. Viral load testing should be done annually, in line with WHO guidelines. An electronic health records system needs to be instituted, which would obviate the need for a patient to have a file, and would facilitate better services.
• Access to condoms in schools and comprehensive sex education should be a priority, in view of the extremely high infection rate of HIV among young women.

Regarding the tuberculosis (TB) endemic, Ms Madonko declared the disease a national emergency, similar to Ebola, and said that it should be dealt with accordingly. More people were dying of TB, and it was more infectious. Few details were provided in the annual report in tracking the prevalence of this disease and specifically which resources were ring fenced or ear-marked to deal with such challenges as the Multi Drug Resistant strain of TB (MDR-TB). The disease was not declining, and more dedicated resources needed to be allocated. Both TB and HIV were a problem in prisons, and required a specific strategy to monitor prevalence by conducting a baseline survey. Better access to treatment in prisons was needed. Ventilation and overcrowding in prisons needed to be addressed jointly by the Department of Health and the Department of Justice and Correctional Services.

Ms Madonko said cervical cancer was closely linked to the issue of reproductive health, and commended the Department for their rollout of the HPV vaccine. More awareness needed to be raised. The Department of Basic Education needed to be involved in ensuring education around protecting oneself against sexually transmitted diseases. She recommended that the Committee support the Minister’s call for quality, age appropriate, sex and reproductive health education throughout the national curriculum.

Emergency medical services were in a poor state in the country, as testified by the submission of 168 individual stories relating to the accessing of such services. The Committee was urged to call on the Minister to finalise and bring into operation the Emergency Services regulations. Gender-based violence in the country was a huge burden and a cost to the state, and a national strategic plan was needed to address this scourge.

The National Health Insurance (NHI) plans were not on track, as indicated by the poor quality of health services provided by the current pilot sites, such as Gert Sibande. The White paper on the NHI needed to be tabled for public comment. The absence of public policy at national and provincial levels on the status of health committees had to be addressed and should be a participatory process. Provincial performance in implementing key national priorities needed to be monitored.

Briefing by the Community Law Centre

Dr Ebenezer Durojaye, Community Law Centre, University of the Western Cape, told the Committee that despite the fact that South Africa’s per capita spending was one of the highest among developing countries, the rate of maternal deaths was high, with 800 in 1999, rising to 1 500 by 2012.

In 2013, it was estimated there were 269 deaths per 100 000 live births. Various legal and policy frameworks speak to this issue, such as the Choice on termination of Pregnancy Act, the strategic plan on Campaign on Accelerated Reduction of Maternal and Child Mortality (CARMMA), the Department of Health’s own strategic plan for Maternal, Newborn, Child and Women’s Health (MNCWH), and Nutrition 2012-2106, which had been launched.

Findings from the research indicate the following:

• A mis-match between policy and implementation;
• A dearth of healthcare providers- about 10 600 doctors provide services for approximately 85% of South Africans who do not have health insurance; and
• Negative attitudes of health care providers.

While the number of maternal deaths per 100 000 live births has decreased marginally, from 159 in 2011, to 146 in 2012 and to 140 in 2013, the money spent in this regard has not had the desired effect. The budgetary allocation grew steadily from R112 billion in 2011, to R121.9 in 2012 and to R133.6 in 2013. The budget allocation for women’s maternal and reproductive health is the lowest of all priorities listed in Programme 3 of the strategic plan, which includes child, youth and school health, HIV/AIDS and TB.

The Eastern Cape in particular seems to have the highest rate of maternal deaths, at 185 per 100 000. Research done in Gauteng and the Eastern Cape highlighted ethical issues in health care, where there was no respect for privacy and confidentiality, and patients claimed they were being forced to undergo a C-section. Poor quality of service and negative attitudes of health providers were some of the findings, as well as overcrowding, stock outs and shortages of essential medicines and a lack of an accountability mechanism.

Dr Durojaye recommended greater investment in training, that human rights should be incorporated into the training, an increase in budgetary allocation to maternal health, public consultation and better coordination among government departments and institutions.

Discussion

The Chairperson said she took offence at being told what to do and that the presentation, instead of making recommendations as to what the Committee should do, should rather have focused on facts and findings, after which the Committee could have explored issues further. The picture being painted was that nothing was being done in the Eastern Cape, yet she knew that just recently 30 ambulances had been purchased for natal and neonatal purposes. She found it hard to believe that women were being forced to submit to C-section operations, since every operation needed a consent form.

Dr Maesela appreciated the effort that members of the community made to look into the health problems of South Africa in doing research and presenting it to the Committee. Some of it was known, some of it was generalised, but “together we can do more”. The country was trying hard to reduce HIV/AIDS infections and all the problems related to it. The government was spending more than any other country in the world to defeat it. Ebola was a concern, and the country was carrying out screening to avoid people carrying infections into society. All the issues mentioned were a priority of the government. South Africa used to have a high doctor to patient ratio, but they had moved to greener pastures and left the country with very few doctors. It was a concern that doctors trained in the country go to America for dollars. The researchers must pass on their knowledge to other people, so that the country would not have high TB, child mortality and mother-child mortality rates.  

Mr Mosala said the recommendations from the TAC did not give a comparative analysis of what the government had done. The TAC was creating an impression that the DOH was misleading the Committee. He believed that the research was a bit biased, as the research participants were only community based organisations (CBOs) and excluded the Department. It appeared as if the only correct information comes from CBOs. The research did not give benchmarks with other countries on millennium development goals, and the research sounded as if only South Africa was behind on the goals.

Ms Ndaba thought that the research was going to provide the Committee with new proposals to solve problems in the health sector. She proposed that the researcher go back to do research on alternatives, without an increased budget. The research did not focus on the quality work that some community health workers do. She asked if TAC had adequate data on all community health workers (CHWs), because in Gauteng the Committee struggled to find accurate data on them.

Mr Shaik Emmam disagreed with the TAC on the state of health in Mpumalanga and Free State. While there were problems, some of the medical facilities were functioning very well, as was seen during oversight visits. He did not agree with the interventions proposed, in that they did not look at what the DOH was doing. It was important not to make a bold statement that the public health was very bad and crumbling. There were interventions that the government was doing, and people were also receiving quality service. It was unfair to generalise that all MECs were underperforming. The intention of research should be toward creating a better life for all, rather than trying to find faults and make perceptions that South Africa’s health system was very bad.

Mr Mahlalela said it was important to look at the recommendations as a win-win situation, especially regarding intellectual property on medicines. The Committee may need to sit back and reflect on the recommendations of the TAC. While the health care in South Africa was better than other parts of Africa, it must be compared to the developed West, rather than African nations. It was absurd to compare South Africa with Malawi.

The TAC replied that it did not want to get into details because it needed two days and chose to be brief. The TAC could give the Committee any information that it may need. TAC was not a research organisation and it presented on issues it experienced in everyday life. The TAC had written to the Deputy President of the country, the chairperson of health in the ANC, and the issues presented were a continuity of efforts to have the issues solved. It was not suggesting that the government was failing, as it had been voted into power again in the May elections because of the people’s confidence in it. However, the TAC was vocal on issues that needed attention. It could not fold itsarms if the public health system was not doing very well. TAC was not an organisation of researchers; it was talking to the issues that people on the ground experience every day. The TAC presentation was to open eyes on health issues, so as to work together. TB in the mines was a big problem. Despite all the efforts government was making in spending billions of rands on health, there was little change on the ground.

Ms Louise Carmody, Thematic Researcher, Amnesty International, said it had published a report on early access to health in South Africa. It had engaged with health care workers, provincial and national departments of health -- in particular, Mpumalanga and KwaZulu-Natal -- and copies could be provided to the Committee. It discussed transport barriers as a determinant for access to health, the progress South Africa has made in monitoring maternal death, as well as other significant improvements. The report compares South Africa to other similar countries in terms of economic development. The reasons why South Africa lags behind other countries were access to education, lack of family planning, access to quality employment and staffing issues. It was not just about remuneration, but the conditions that health care workers face.

The Chairperson said it was not correct for the Committee to be categorised as having people who did not care for the interests of ordinary people in South Africa. The mere fact that the Committee was playing an oversight role was because it was concerned, just like any other organisation. While things were not as rosy as they should be, the TAC should not have threatened that the Committee was doing nothing. She comes from the rural Eastern Cape, and was well aware of the challenges of the clinics there. A presentation should not be in general, but must be detailed. It must specify where in the province, and at which hospital a patient was forced to undergo a C-section, because it was criminal. The Committee knows that the Minister of Health, as the political custodian of that sector, was making every effort. It was important that research presented did comparative analysis, stating where and how the research was done, and not just make generalisations based on shallow facts.

The TAC replied that all the key points were in the recommendations supported by a different report on TB, the Eastern Cape and Free State. It could provide specific information to the Committee when requested.

National Department of Health Annual Report 2013/14

Ms Malebona Matsotso, Director General, said the health sector derives its vision and mandate from NDP 2030.

By 2030, South Africa should have:

• Raised the life expectancy of South Africans to at least 70 years.
• Progressively improved TB prevention and cure.
• Reduced maternal, infant and child mortality.
• Significantly reduced the prevalence of non-communicable diseases.
• Reduced injury, accidents and violence by 50 percent from 2010 levels.
• Completed health system reforms.
• Established primary healthcare teams to provide care to families and communities.
• Implemented universal health coverage.

Highlights of the annual report were:

• The Department had filled posts with skilled, committed and competent individuals.
• The vacancy rate was reduced to 4.34%, which is below DPSA’s target of 10%.
• 103 out of 109 senior managers signed and timeously filed performance agreements with DPSA.
• The National Department of Health (NDoH) has for the last three consecutive years obtained an “unqualified audit opinion” on the external audit of the financial information by the Auditor-General (SA), including 2013/14 financial year.
• Seven out of nine provinces had qualified audits. All provinces had developed financial improvement plans.
• The Normative Standards Framework for eHealth for the public health sector had been developed and approved. The eHealth Strategy seeks to ensure an Integrated National Patient-Based Information System.
• The Council for Scientific and Industrial Research (CSIR) undertook an assessment of Patient Information Systems used in primary health care settings to make recommendations for an effective patient information system.
• Under the auspices of the National Health Research Council, a national health research database is being established.
• The National Health Research Scholars Programme, which seeks to produce 1 000 PhD graduates in all fields of health sciences over the next 10 years, was expanded in 2013/14. 13 PhD candidates were enrolled in 2012/13, and 26 candidates enrolled in 2013/14.
• The availability of drugs has improved from 58% to 73%.
• Out of contract procurement had decreased from 36% to 12%.
• Buy-outs decreased by 26%.
• Warehouse productivity has improved by 26%, reducing the requirement for overtime as well additional hiring of staff.
• Order processing time has been improved from pre project levels of 32 days on average, to current levels of 11 days.
• The total number of deaths registered by Home Affairs was 480 476, which was a decline of 6,2% from the 512 310 deaths that occurred in 2011.
• 2 638 students were registered for the first year of the medical degree in South Africa (1 756) and Cuba (882).
• A total of 88 doctors from Cuba were distributed to the provinces.
• 260 hospital CEOs have undergone training to enhance the management capacity of the public health sector
• A Public Health Enhancement Fund was created jointly with the private sector. R20 million from this fund was used to support the training of 100 medical students from disadvantaged backgrounds.
• The overall provincial Conditional Grant spending was 96%, or R27 billion, against the total adjusted budget inclusive of provincial roll-overs, of R28 billion.

Discussion

Dr Maesela said the Department was doing a sterling job in improving peoples’ access to health. He asked what the DOH was doing to overcome the lack of consequences for poor performance, poor leadership from management, instability in key positions, and the lack of leadership coherence between provincial and national departments of health. He asked why the DOH was not producing condoms itself, rather than waiting for suppliers.

Mr Matiase asked what the DOH was doing about IT governance and the lack of consequences for non-compliance as raised by Auditor General. He said that life expectancy in South Africa must be measured against the life expectancy of white people. He asked what was done to community health workers after they had been trained and their conditions of service. What was the percentage of community health workers in the Free State, which had become a hub of protests? He asked why there was under expenditure on the National Health Insurance flagship programme. The Department lacked containment strategies on Ebola by not even assisting the West African countries so that the virus was contained there, rather than waiting for the virus to come in South Africa.

Mr Mahlalela said the Committee had been briefed on the role South Africa was playing in West Africa. He asked what was being done to ensure that provinces fill management positions with skilled people, not just at national level. The report gave a discrepancy in the number of people who signed performance agreements -- 101 and 108 on different pages. The Department had been getting an unqualified audit opinion for three years, with the AG always raising the point that the quality of data was problematic, and this was not being addressed. He asked how the DOH was going to address under-spending on the NHI. He asked about the challenges the Department was experiencing on maternal mortality and measures to resolve them. He asked if the percentage of employment equity was at senior management or general management level.

Dr James was concerned with the high number of targets that were not achieved, in particular HIV/AIDS, maternal health and primary health care. It was very important that the Minister was fully resourced to fight Ebola. All hospitals must be Ebola-ready, and skilled people must be deployed at all strategic ports of entry for Ebola screening, with sufficient logistical arrangements, air and land ambulance systems. He was willing to help the Minister raise additional funds for Ebola from the private sector.

Mr Emmam Shaik said a lot was being done in the health sector, as the presentations got better and better every time the DOH appeared before the Committee. He asked if the AG had not consulted the DOH on the audit report it had released. He asked what the DOH was doing to ensure that the Department of Education spends money allocated for HIV/AIDS education. He asked if information was shared across all clinics in the country.. The DOH was supposed to consult the Committee on strategic planning before the budget was tabled, as recommended by the AG. He asked what plans were in place so that the country was not dependent on vaccines from the outside world. He asked what could be done to increase the intake of medical students through the country. He asked what consequences the DOH was implementing for non-compliance at provincial and local level.

Ms Ndaba was concerned with the unauthorised and irregular expenditure as raised by the AG, and under-spending on health infrastructure. She asked if the funding model of grants was workable.

Mr Mosala was concerned with the lack of leadership in management, giving rise to problems in delivery of health care. He was surprised that people could be in an acting position for two years without the post being advertised, with the Department complaining that there was a lack of qualified people.

Mr H Volmink (DA) said there was under-spending on the NHI which was very concerning. The reasons were in supply chain management, which was identified as the main risk area by the AG. What was being done to address this? He asked why there was a lack of compliance with legislation.

Minister of Health’s response

Dr Aaron Motsoaledi, Minister of Health, said that areas of the AG were of serious concern, particularly as only North West and Western Cape got unqualified audit reports. The Members were well aware that constitution did not provide a framework for the Minister to punish any MEC. When he was MEC in Limpopo, the Standing Committee on Public Accounts (SCOPA) took the bull by the horns to the extent of recommending firing the HOD of Transport and recommended that that person must not work for the state for the rest of his life. Members of Parliament have that oversight power, and he recommended that the oversight of the Committee be strengthened. He can only call on the MEC to respond to the AG’s recommendations -- other than that, he does not have any instrument to impose consequences.

Life expectancy was talked about in terms of the whole country, and was never divided between races. It was common knowledge that life expectancy was dependent on the socio-economic background of individuals.

Dr Motsoaledi said there was no NHI in South Africa yet. This was the country’s intention, and the starting point was the pilot projects. Under NHI, the country wants to promote primary health care, encourage people to go to clinics, and a lot of problems were being picked up from the pilot projects. For example, some of the clinics were very under-resourced, and the solution was to build all clinics to a certain standard, as directed by the President, so that when a doctor was sent there, he or she could not complain. The DOH had come up with ten components that a standard clinic must have, starting with administration, to pharmaceuticals, security, water supply, electricity supply, sanitation, financial management -- all which were in the model of an ideal clinic. DOH had chosen ten clinics to pilot the ideal clinic model. The aim was to extend the ideal clinic model to all 3 000 clinics in the country. 3 000 computers had been ordered for 700 clinics in the NHI pilot district to ensure that the administration was computerised.

The other issue that had come as a surprise was the consulting of doctors. They were not willing to work in clinics, or they would tell their colleagues to stand in for them and then share the money. The other complaint was the level of remuneration the state used to pay to doctors when they consulted in hospitals. While the NHI was giving them more money than when they used to consult in hospitals, they still complained that it was too little. The doctors believed that the NHI was a pot of gold to milk from. The NHI was about national coverage to ensure that every citizen got good quality health care, regardless of socio-economic backgrounds.

Dr Motsoaledi said the private health sector was using 4.1% of the GDP to serve 16% of the population, while the public health system was using 4.4% of the GDP. South Africa was spending more on health than even the United States in terms of GDP. He had been invited to Harvard University for seminars on health and the invitation letters even indicated that whatever you do, do not follow the American model of health care, but follow the European. South Africa was at the same level as Europe’s spending of GDP on health, regardless of different results.

In the previous week, Dr Motsoaledi had called for a press conference to talk about Ebola and was on air the next day for an hour talking about it again. Africa had been experiencing infectious diseases more than other continents, so the country had skills to fight Ebola. South Africa was the first country to deploy experts to Sierra Leone, before any country from Europe, and had spent seven weeks there. The team had given a report on the status of health readiness of those countries, and the number of medical practitioners deployed from other countries. The National Institute of Communicable Diseases had been declared by the World Health Organisation as a collaborative research centre -- a centre of excellence. South Africa was doing its best to fight Ebola. Of the 8 000 people diagnosed with Ebola in West Africa, 2 000 had been treated by South Africans.

The team from South Africa was also training health workers in Sierra Leone, and had established a lab there which will not be removed when the fight against Ebola ends. Many rich countries had declared billions in aid, but very few had reached those countries. South Africa just woke up and sent a team of experts. Because Dr James suggested that he could help the Minister raise money from the private sector to fight Ebola, he joked that he now had proof that the private sector was owned by DA. The affected countries were going to get two ambulances each, five scooters, 5 000 items of protective equipment, 50 tons of maize meal, medicines, and laboratory equipment among other things, through their embassies in South Africa. Other companies were approaching him, trying to give their help to fight Ebola in West Africa.

Dr Motsoaledi said the DOH was doing well on maternal health, especially in the past five years. The Commission on Maternal Health suggested that the main cause of maternal death was HIV/AIDS, which was responsible for 50% of maternal deaths in South Africa. South Africa had started the fight against HIV late, but it was winning the battle. Some of the women, especially in rural areas, never come to the clinic early enough to get help on hypertension. Some of the people living in far rural areas start going to the clinic only when they were going into labour, and it was impossible to deal with hypertension at that stage, hence the MomConnect programme to link mothers to vital health care in both the private and public sector. Members must encourage people in their constituencies to register for MomConnect. Maternal mortality was high from 1999, had started to drop in 2009, and it will keep on dropping. The DOH had not reduced the hospitals dealing with Ebola from 11 to three, but trained 1 500 people more outside those hospitals.

Ebola was changing the attitude of people in unimaginable ways. Health workers were so scared that they were causing problems. The symptoms of Ebola included light symptoms like general body pain and muscle pain. The second stage was fever. It looked like fever had become Ebola in South Africa, and was being considered as Ebola. The third was bleeding, and even when a person bled from the nose at a hospital, he was getting a call from a journalist. People who were HIV positive and diabetic were being chased away, because of Ebola. Ebola was not the only haemorrhagic fever that existed. Some had been experiencing different types of fever in South Africa for many years. He highlighted that Congo Fever, for example, caused by not dipping cattle was endemic in the Eastern Cape, Free State and parts of Western Cape, and had the same symptoms as Ebola. People must understand all the types of fever. The DOH had been sending people around the world to understand how emergency services were run. Anyone with advice must send it to the advisory team of experts from UCT, Wits, Stellenbosch, University of KwaZulu-Natal, and Pretoria.

Dr Motsoaledi said it was a mistake that with a population of 54 million, South Africa’s last medical school was built 29 years ago. Cuba had 11 million people and 27 medical schools. He had identified spaces where medical schools needed to be built. There was a brand new strategy which the NHI infrastructure was going to deliver. The old method would not work with the NHI. He had called the MECs after elections and spent ten hours deliberating on infrastructure challenges, and it had been resolved that each and every province needed to form an infrastructure team led by the MEC, and at the national level it would be headed by the Minister and officials from the national department. Being a Minister was very unfortunate -- when one became involved it was political interference, but when one does not go there, there is no political leadership. He had agreed with the MECs that the political leadership should be involved in infrastructure. The Director of WHO had said that unless Africa deals with infrastructure, the issue of universal health coverage will never happen on the African continent. If political leaders do not get involved directly in ensuring that infrastructure, then it will be a problem.

The AG had recommended that the Minister take responsibility for infrastructure grants. There were now norms and standards for a clinic, developed by the Council for Scientific and Industrial Research (CSIR). In 2011, the Minister of Finance had withheld money for provinces because they were not spending. He will come up with strategies for management in provinces with MECs. The only vacant positions at the national level were those that were advertised and no suitable candidates were found. It was better to re-advertise the position than to employ a person who the Department will have problems trying to fire. The DOH does not have a DDG for NHI. It has even interviewed people from outside the country for the third time by telephone conferencing, but to no avail. There was a need to produce 1 000 PhDs in the next ten years, especially in the fields of HIV and TB. Members were custodians of legislation and should ensure that it was implemented. If the AG says legislation was not followed, the Members must shout and make a noise about no compliance. The NDOH only had a department to deal with clinical compliance.

Ms Matsotso said that the DOH was rolling out IT systems and training people to use them. It was replacing registers and linking them to information systems. It works with Stats SA to come up with quality data and uses the Stats SA guideline to train all district managers and data capturers. 3 535 data capturers had been trained to date, with the help of University of Pretoria. The Department of Public Service and Administration had advised it that the data capturers be recognised as a category of people specifically trained to capture data. It was recruiting the next cohort of data capturers. Two years ago, it had employed 500 IT, human resource and finance unemployed graduates and after one year of internship, they were employed for two years and deployed to the provinces. Those with IT experience were helping in the rolling out of 3 070 computers in 700 clinics. Because the IT was funded by the European Union, it was negotiating with provinces to absorb the graduates so that they will continue running the system, should the EU funding end. The problem of consultants was that they come and do the work and do not leave capacity in the institution. The DOH had spoken to Further Education and Training (FET) colleges about giving learners who had finished their studies an opportunity to work. The AG wants general practitioners (GPs) who consult in public hospitals, though not employed on a full time basis, to be recorded as consultants, even though they were not.

Dr Motsoaledi said maybe the AG should change its rules. After 1994, he started hearing the word consultancy to refer to everybody who does not work for the government, and who comes in and does some work. It was completely meaningless because throughout medical training, the word “consultant” refers to the most senior medical doctor.

Ms Matsotso said the DOH had a programme with 32 non-governmental organisations. The AG saw them as consultancies, but the DOH does not see them as such.

To achieve connectivity, it was working with the Department of Communications to try and see whether it had initiatives that can help it achieve connectivity quickly in the public sector. There was an initiative to produce medicine locally. South Africa consumes a significant portion of ARVs and there was no reason not to produce them as a country to address its needs, given that it needs 30% of the global volume of ARVs. In 2011/12, regular, fruitless and unauthorised expenditure was R25 million, in 2012/13 it was R2.3 million, and had been reduced to R188 000 in the just ended financial year. R188 000 was not materially significant.

The Committee was told that the problem with the supply of condoms was because the rubber used in the making of condoms can be found only in a few countries in South East Asia, particularly Indonesia and Malaysia. The output of rubber from these countries was outweighed by demand. Another challenge was the cost implications of the depreciating rand over the past three years. The third problem was from provinces who did not order sufficient condoms.

GPs were not located in areas where NHI pilot projects were being rolled out. Some of them had to travel reasonable distances and were charging fees that included travel costs. The DOH could not afford to contract GPs and give them the rate they were demanding, because this would create future problems for the NHI.

Supply chain management was a problem in all the provinces. The key issue was that people had a limited understanding of the supply chain system. There were problems around when to procure. Many institutions believe that if they need something tomorrow, it will arrive tomorrow. There was a lack of planning.

Dr Motsoaledi said that when DOH contracted medical practitioners, it wanted people without medical aid to find a doctor in a clinic, especially in rural areas. Unfortunately, the GPs willing to contract want to do so in urban areas, which was exactly where they were not wanted. Health was not the only department affected by this -- it was also affecting education, where teachers were teaching where there was no electricity, running water, movies or theatres. They were given a rural allowance to go and work there, but they would come to sleep in town after an hour, which defeated the whole purpose of a rural allowance. The DOH was being accused of being like apartheid and dictators, by trying to send people to rural areas where there was a need for them.

Dr Terence Carter, DDG, DoH, said that the issue of management had been prioritised by the DOH. Up until 2012, anybody could become the chief operating officer of a hospital, whether that person was a teacher, preacher or even a post master. Through legislation, the DOH now had qualifications listed for people who became hospital managers, in particular health knowledge training and skills. The Department had discovered that people did not only need qualifications, but the right competencies. DOH was working with international organisations, because the issue of competence was not just a South African problem. It was working with the Medicins Sans Frontieres (MSF) leadership academy, the Leadership and Management Academy of South Africa, and the American Leadership of Health Care. There was a competence framework, developed in consultation with international hospital federations, so that the training of hospital managers was not only geared towards qualifications, but towards competencies.

The Chairperson thanked the DOH and the Members for a very long day meeting.

The meeting was adjourned