JOHANNESBURG, November 15 – AfriBusiness said on Wednesday that it welcomes the Davis Tax Committee’s report that the plan to implement the National Health Insurance (NHI) in South Africa should be scrapped.
Afribusiness, the non-profit business rights watchdog, said the NHI cannot be implemented in South Africa whilst economic growth in the country is left wanting.
This comes after Monday’s release of the Davis Tax Committee report which focused on the financing of the NHI. The report emphasised the need for proper consultation before the health insurance scheme is implemented and said that the uncertainty around how South Africa’s NHI will work was cause for concern.
The committee, chaired by Judge Dennis Davis, was set up in July 2013 to assess South Africa’s tax policy framework and submit recommendations to the finance minister.
Law and policy analyst at Afribusiness, Armand Greyling, said there has been much uncertainty regarding the implementation and financing of the NHI over the past seven years.
Two white papers from government have indicated that by 2025, it would cost the country R256 billion in 2010 terms to implement the NHI if the country had a GDP growth equal to 3.5 percent per annum.
Greyling said that AfriBusiness had said from the beginning that the NHI was a “health hazard spun from toxic ideology, doomed to place an unbearable financial strain on the country”.
“The NHI cannot and will not work. The South African fiscus is in no position to even afford attempting it, and if it were to be attempted, the project would achieve much worse public healthcare outcomes than that which currently exist,” Greyling said.
However, Greyling said AfriBusiness disagrees with the committee’s suggestion that, pending sustainable growth in the economy, certain taxes could be raised and implemented to finance the NHI at a later stage.
Greyling said AfriBusiness maintains that the NHI is doomed to failure regardless of economic growth.