Budget Cuts Loom - Can The Private Sector Save Sa's Public Health System?

Source: Supplied. Palesa Mokomele, head of Community Engagement and Communications at DKMS Africa.

Coupled with the burden of servicing government debt, which is set to exceed R6.05 tn in 2025/26, this will undermine the country’s tax revenue, necessitating difficult decisions on spending priorities and potential budget cuts in the upcoming Budget Speech - something the already ailing health sector can ill afford.

Palesa Mokomele, head of Community Engagement and Communications at DKMS Africa, highlights that with about 83% of South Africans depending on the public health system, funding cuts could leave millions vulnerable, especially with 20.13% of households already delaying obtaining healthcare as they cannot afford it.

“Additionally, with medical aid schemes hiking their prices by between 9.3% and 12.8% this year, a number of households may find themselves unable to afford private healthcare, pushing them to rely on the overburdened public health system.”

The Government's current per capita health expenditure stands at R3,169 but is projected to decrease, intensifying the challenges for patients battling diseases like cancer.

With treatment costs ranging from R1m to R1.5m per patient, disparities in timely access to care continue to influence outcomes for one of the nation’s leading causes of death.

As the Parliamentary Budget Office warned in its 2024 Amended Division of Revenue, Adjustment Appropriations and Special Appropriation Bill presentation, “Without real per capita increases in health funding, the healthcare system will remain overstretched, unequal, and severely underfunded”.

Private sector's health role

“South Africa’s private sector is uniquely positioned to play a critical role in bridging the health funding gap,” points out Mokomele. “Corporate Social Investment (CSI) initiatives offer businesses the opportunity to make a meaningful impact by contributing to public health projects, infrastructure development, and organisations operating in the sector.”

She highlights that not only is investing in the health sector a moral imperative, but an opportunity for the private sector to benefit through Section 18A tax deductions. “Contributions to eligible non-profit organisations or public benefit initiatives are tax-deductible, allowing businesses to support critical health services while also enabling them to retain a larger share of their income.

“By actively supporting public health initiatives, companies demonstrate their commitment to corporate responsibility, thereby cultivating goodwill among customers, employees, and stakeholders. Moreover, healthy communities are more productive and stable, which directly benefits business operations and drives economic development,” adds Mokomele.

“The time to act is now. South Africa’s health sector cannot afford further setbacks. A united effort between the public and private sectors is essential to safeguard the health and wellbeing of all South Africans,” she concludes.