SELECT COMMITTEE ON APPROPRIATION HEARING ON DIVISION OF

SELECT COMMITTEE ON APPROPRIATION HEARING ON DIVISION OF REVENUE BILL B 4 -2011 -03 -23 1

Introduction • During the Medium Term Framework ( MTEF) budget process, the Health Department requested additional funding for both National and Provincial departments for the amount of R 19, 9 billion for the three year MTEF period. • Cabinet and National Treasury approved an amount of R 18 billion made up of R 3, 4 billion for National Health and R 14, 6 billion for the provincial health departments for earmarked funds additional to the equitable share baseline. 2

Expenditure Trends • The Department’s expenditure grew from R 13. 6 billion in 2007/08 to R 23. 1 billion in 2010/11 at an average annual rate of 19. 4 percent. • Over the Medium Term period, expenditure is expected to grow to R 30. 1 billion, at an average annual rate of 9. 2 percent. • The increase in both periods is driven largely by transfers to provinces for the conditional grants, with the main increase being on the HIV and AIDS and the Revitalization of Hospitals grants, while the National Tertiary Services grant (NTSG) increased significantly in the MTEF period. • The Forensic Pathology Services grant will be phased out in the 2012/13 financial year and has therefore been included in the provincial equitable share allocations. 3

Medium Term Allocation for 2011/12 – 2013/14 • The Budget includes new allocations of R 442 million for 2011/12, R 692 million for 2012/13 and R 2. 2 billion for 2013/14. 4

Programme Allocations for 2011/12 -2013/14 PROGRAMMES R’ million Administration Health Planning and Systems Enablement HIV&AIDS, TB and Maternal, Child and Women’s Health Primary Health Care Services Hospital Tertiary Services and Workforce Development Regulations and Compliance Management Total Budget Allocated 10/12 11/12 12/13 13/14 282 326 325 344 125 161 178 190 6, 669 8, 027 9, 377 11, 188 700 730 143 150 13, 947 15, 963 17, 016 17, 664 496 525 572 601 22, 219 25, 732 27, 611 30, 137 5

Economic Classifications Allocations for 2012/13 to 2013/14 Economic Classification 10/11 11/12 12/13 13/14 Compensation of Employees 385 424 465 492 Goods and Services 755 785 795 830 21, 034 24, 489 26, 316 28, 778 45 33 35 37 - - 19 22, 2 25, 732 27, 611 6 30, 137 Total Transfers & Subsidies Payment of Capital Assets Payment of Financial Assets Total

Conditional Grants Purposes for 2011 -12 The Department of Health of consists of the following grants: • Comprehensive HIV and Aids Grant To enable the health sector to develop an effective response to HIV and Aids including universal access to HIV Counselling and Testing (HCT). To support the implementation of the National Operational Plan for comprehensive HIV and Aids treatment and care. To subsidise in-part funding for antiretroviral treatment programme. • Forensic Pathology Services Grant To continue the development and provision of adequate forensic pathology services in all provinces. • Health Infrastructure Grant To supplement provincial funding of health infrastructure to accelerate the provision of health facilities and ensure proper maintenance of provincial health infrastructure. 7

Conditional Grants Purposes for 2011 -12 Cont…. • • • Health Professions Training and Development Grant Support provinces to fund service costs associated with training of health professionals. Development and recruitment of medical specialists in underserved provinces (Eastern Cape, Limpopo, Mpumalanga, Northern Cape and North West). Support and strengthen undergraduate and postgraduate training processes in health facilities. Hospital Revitalisation Grant To provide funding to enable provinces to plan, manage, modernise, rationalise and transform health infrastructure, health technology, monitoring and evaluation of the health facilities in line with national policy objectives. private partnerships. National Tertiary Services Grant To compensate tertiary facilities for the additional costs associated with spill over effects. Ensure adequate provision of tertiary health services for all South African citizens. 8

Conditional Grants Allocations 2011/122013/14 Grant Health Infrastructure Grant Health professions and Development Training National Tertiary Services Comprehensive HIV and Aids Forensic Pathology Services Hospital Revitalization Grant Total 2011/12 Schedule R'000 2012/13 R'000 2013/14 R'000 4 1, 701, 8 56 1, 820, 98 1 4 1, 977, 3 10 2, 076, 17 6 4 8, 048, 8 78 8, 688, 82 2 07 5 7, 492, 9 62 8, 824, 61 0 10, 606, 664 26, 924, 236 590, 3 5 80 - 5 4, 136, 2 90 4, 335, 90 8 23, 947, 6 76 25, 746, 49 7 34 66 1, 921, 1 Total R'000 2, 190, 3 9, 389, 2 59 5, 443, 971 6, 243, 852 26, 126, 907 590, 380 4, 067, 8 12, 540, 057 28, 175, 230 77, 869, 403 9

Health Infrastructure Grant 2012/13 R'000 2013/14 R'000 299, 754 327, 673 345, 695 Free State 129, 621 141, 911 149, 716 Gauteng 142, 694 157, 434 166, 093 Kwa. Zulu-Natal 358, 471 393, 367 415, 002 Limpopo 270, 802 267, 888 282, 622 Mpumalanga 146, 368 143, 383 151, 269 89, 501 98, 258 103, 662 North West 145, 466 159, 656 168, 437 Western Cape 119, 179 131, 411 138, 638 1, 701, 856 1, 820, 981 1, 921, 134 Provinces Eastern Cape Northern Cape TOTAL 2011/12 R'000 10

Comprehensive HIV and Aids Grant Provinces 2011/12 R'000 2012/13 R'000 2013/14 R'000 Eastern Cape 844, 390 993, 094 1, 193, 915 Free State 478, 007 563, 331 677, 016 Gauteng 1, 622, 894 1, 912, 719 2, 298, 693 Kwa. Zulu-Natal 1, 977, 035 2, 329, 362 2, 799, 561 Limpopo 539, 022 634, 700 762, 896 Mpumalanga 543, 502 641, 742 771, 003 Northern Cape 258, 802 305, 124 366, 675 North West 493, 595 580, 964 698, 356 Western Cape 735, 715 863, 574 1, 038, 549 7, 492, 962 8, 824, 610 10, 606, 664 TOTAL 11

Forensic Pathology Services Provinces 2011/12 R'000 2012/13 R'000 2013/14 R'000 Eastern Cape 73, 506 - - Free State 39, 451 - - Gauteng 97, 966 - - 161, 550 - - Limpopo 42, 308 - - Mpumalanga 53, 114 - - Northern Cape 24, 240 - - North West 28, 019 - - Western Cape 70, 226 - - 590, 380 - - Kwa. Zulu-Natal TOTAL 12

Hospital Revitalization Grant Provinces 2011/12 R'000 2012/13 R'000 2013/14 R'000 Eastern Cape 382, 048 402, 678 387, 104 Free State 417, 883 438, 140 412, 172 Gauteng 801, 965 828, 552 760, 206 Kwa. Zulu-Natal 547, 698 566, 605 533, 432 Limpopo 371, 672 392, 410 369, 152 Mpumalanga 356, 557 378, 014 355, 081 Northern Cape 406, 892 427, 263 401, 940 North West 370, 074 401, 150 377, 375 Western Cape 481, 501, 096 471, 397 4, 136, 290 4, 335, 908 4, 067, 859 TOTAL 13

Health Professions Training and Development Grant Provinces 2011/12 R'000 2012/13 R'000 2013/14 R'000 Eastern Cape 170, 071 178, 730 188, 560 Free State 124, 444 130, 930 138, 131 Gauteng 690, 803 725, 310 765, 202 Kwa. Zulu-Natal 249, 917 261, 860 276, 262 Limpopo 99, 730 103, 913 109, 628 Mpumalanga 80, 718 85, 208 89, 894 Northern Cape 65, 510 68, 583 72, 355 North West 88, 323 93, 522 98, 666 407, 794 428, 120 451, 667 1, 977, 310 2, 076, 176 2, 190, 366 Western Cape TOTAL 14

National Tertiary Services Provinces 2011/12 R'000 2012/13 R'000 2013/14 R'000 Eastern Cape 609, 327 660, 693 698, 110 Free State 715, 204 769, 964 800, 000 Gauteng 2, 759, 968 2, 933, 361 3, 100, 895 Kwa. Zulu-Natal 1, 201, 831 1, 303, 824 1, 408, 053 267, 314 277, 314 287, 314 91, 879 105, 970 120, 270 Northern Cape 235, 948 245, 948 255, 948 North West 194, 280 209, 280 224, 280 Western Cape 1, 973, 127 2, 182, 468 2, 494, 337 TOTAL 8, 048, 878 8, 688, 822 9, 389, 207 Limpopo Mpumalanga 15

Conditional Grants Allocations 2011/12 -2013/14 • Schedule 4 grants: specifying allocations to provinces to supplement the funding of programmes or functions funded from provincial budgets; • Transfer payments cannot be withheld based on non performance or compliance, however, the new Division of Revenue Grant allows a 5% withholding while interventions are put in place. • Grants included are: - National Tertiary Services, - Health Professions Training and Development - Forensic Pathology Services. 16

Conditional Grants Allocations 2011/12 - 2013/14 • Schedule 5 : specifying specific-purpose allocations to provinces. • Grants included are: - HIV and AIDS grant and the Revitalization of Hospital grant. • Schedule 5 grants may be withheld for non performance and or compliance. Interventions must also be put in place for compliance. 17

Additional Priority focus areas (Earmarked Funds) Allocated directly to Provinces. R million 11/12 12/13 13/14 Health technology 20 30 40 Nursing colleges upgrading and maintenance 32 32 32 110 119 126 OSD therapeutic top-up 363 426 449 Maternal and child health 228 501 700 Personnel and goods stabilization 522 1, 073 1, 444 - 500 OSD doctor Annexure A -up HIV: ARV 350 threshold top 18

Additional Priority focus areas (Earmarked Funds) Allocated directly to Provinces. R million 11/12 12/13 13/14 Registrars esp paed, obs and critical posts 100 200 300 Family health team pilots/models 100 400 700 Public hospital norms and standards 240 486 532 Policy priorities subtotal 1, 715 3, 767 4, 823 Improvements in conditions of service 1, 556 620 654 Forensic pathology shift into PES Total 3, 271 5, 943 7, 033 19