Maverick Citizen


Health minister warns of negative impact of ‘cost containment’ on quality of healthcare services

Health minister warns of negative impact of ‘cost containment’ on quality of healthcare services
Livingstone Hospital in the Eastern Cape. (Photo: Black Star / Spotlight)

Although Dr Joe Phaahla said that in the current economic climate, ‘we understand we have to cut’, he lamented that the public health sector was very sensitive to budgetary cuts and was already under pressure from a growing burden of disease.

On Thursday morning, at a meeting with members of the media, Health Minister Dr Joe Phaahla said he was concerned that “cost containment” measures ordered by the National Treasury would have a negative impact on the quality of healthcare services. “We understand we have to cut … as long as there’s an understanding [that] there’s a limit” to what the health system can bear, Phaala said.

Phaahla’s frank admission was in response to a question from Daily Maverick about the effect austerity would have on the right to access healthcare services.

cost phaahla

Health Minister Joe Phaahla addresses a media briefing in Midrand, Gauteng, on 28 September 2023. (Photo: Mark Heywood)

The minister, who said he preferred talking about “cost containment” rather than “austerity”, reported that his department had been raising concerns about budget cuts “continuously” even before the current Treasury “instruction” which, he revealed, was on Wednesday, 27 September amended to be “advice” to departments — perhaps reflecting the growing pushback from within and without government about the consequences of austerity on social services.

Although Phaahla said that in the current economic climate, “we understand we have to cut”, he lamented that the public health sector was very sensitive to budgetary cuts and was already under pressure from a growing burden of disease. “Anything that speaks to cutting expenditure is a red flag — we’ve said that to the Treasury.” 

The minister reported that the health system “lost ground as a result of Covid-19”, mentioning HIV, TB and “an explosion of mental health issues and substance abuse” as areas where the health system had experienced setbacks.

Read more in Daily Maverick: South Africa’s delivery of crucial services under threat after Treasury desperately calls for ‘fiscal consolidation’ of public finances 

Phaahla reported that on Wednesday he met senior managers in the Department of Health, including the director-general and chief finance officer, to “look where we can contribute to cost containment without significant risk”.

Mentioning planned cuts to travel and meeting costs (he pointed out that the meeting with the media was held in the offices of Health Systems Trust rather than a hotel), he said that the department had costed savings, although he would not disclose figures.

Phaahla said that they had met statutory bodies like the Medical Research Council, National Health Laboratory Services and Office of Health Standards Compliance to request that they make savings.

‘We will feel the pinch’

However, the minister admitted the budget cuts came with a price for quality healthcare. 

“Our biggest expenditure is human resources and we will feel the pinch of the 7.5% salary increase” which, Phaahla says, amounts to an additional cost of R8-billion per annum.

Without additional funding from the National Treasury, the minister said, that amount had to be found within the existing budget. 

“It’s unavoidable that some posts will not be filled” and that there might be cuts to budgets in areas like hospital infrastructure. Ironically, he said this at the same time as talking about the need for hospitals in Johannesburg affected by water shortages to include plans for building water storage containers in their business plans, “although that will take away from other necessary upgrades”.

In response to a question about why the cash-strapped department and government had paid so much for Covid-19 vaccines, Phaahla (who was deputy minister of health at the time) talked about how the government had been “held at ransom” by multinational pharmaceutical companies as the clamour for access to vaccines in South Africa grew in early 2021.

Read more in Daily Maverick: Health Justice Initiative slams ‘bullying’ $734m SA Covid-19 vaccine contracts 

“In retrospect, we accept the fault,” said Phaahla, but he claimed the government was “between the devil and the deep blue sea”.

He said that on the one hand, people were “screaming, where are the vaccines?” and pointing fingers at the government. On the other hand, big pharma was telling the government, “Take it at this price or leave it.”

He talked of “midnight meetings pleading for stocks”, recalling being part of a very late-night meeting with Pfizer, which wanted “an upfront deposit of a couple of hundred of millions of dollars”.

According to the minister, “We said we don’t have that money.” The only upfront payment was made to the WHO-overseen Covid Vaccine Facility (Covax). DM


Comments - Please in order to comment.

  • Heinrich Holt says:

    And so will one incompetent minister or state institution after the other “warn” that budget cuts will impact their portfolio’s service delivery. Fact is, they have not been delivering all along. Time to cut out the fat, the dead wood, and the feasting. Prioritise. Businesses have been doing this for years. Start to work. Don’t just come to work to sit and gain weight. Add value. Bring purpose. Take a pay cut and be thankful for having a job. Employees in some private businesses have not received increases for years. Yet they still work with meaning and purpose. Time for the pharmacist to retire. Same for the doctor who prints passports at the pace of a snail. Not to speak of the guy with the hat. Get rid of all deputy ministers. Nobody knows what they do anyway. So many opportunities to optimise.

  • Wilhelm Boshoff says:

    Austerity avoidance. ANC cadres just stop stealing! Stop appointing unqualified & incompetent cadres.

    • Denise Smit says:

      When the HRC held their hearings in Durban about the 2021 violence they were most concerned about their day’s lunch arrangement. Gaum was vocal about that. Wonder what this cost them – amid the devastation?. They should be ashamed. And was their any report after that, would like to see it?. Denise Smit

    • Denise Smit says:

      Why can the ANC/EFF government not hold its meetings in their own offices. Why should it be in hotels with catering every time. But this is what happens in Parlement and they are used to get everything for free on us the taxpayer. Denise Smit

  • Barrie Lewis says:

    Phaahla’s depart of health has no inkling that the “growing burden of disease” in South Africa is largely nutrition driven. The obesity and diabetes epidemics in SA are entirely related to the high refined carb diet that we eat; and the department has nothing to say on the matter. To the extent there was no protest when white bread for example was zero VAT rated.

    Only when the Phaahla and co start to take nutrition science seriously can we ever make progress against these chronic degenerative diseases that have brought the beloved country to such tears.

    It’s no coincidence that SA finds itself amongst the ten most unhealthy countries in the world, according to certain criteria we carry the wooden spoon.
    The growing burden of disease… actually the growing burden of a department of health that is clueless.

  • Christo Van der Westhuizen says:


  • Fuad XXX says:

    Treasury I have a suggestion or two:
    1) Drastically cut the extreme criminal brigades aka VIP protection.
    2) Remove ALL free expenses for the M.P.s and cabinet ministers.
    3) Provide ONLY 2 reasonable vehicles
    4) Drastically cut on government size (& employ only competent individuals)
    5) Prosecute thieves & take back stolen funds from wherever.

  • Ina-Lize Venter says:

    This would be easily solved if all ministers, members of parliament, and other overpaid government officials were obligated to use the very same public healthcare system they are supposed to govern. If you yourself, your child, your husband or wife, or any other person you cared for only had the option of a state facility, you would do everything in your power to ensure the standards are up there with private healthcare. There would be no filthy, overcrowded and understaffed hospitals and no substandard schools with unqualified educators and pit latrines. Our schools and hospitals would be facilities of note and we would have a proud legacy of education, training and world-class healthcare.
    Alas – our ministers send their children to private schools and join expensive medical aids so they never have to go to a public hospital or clinics again. As for the rest of the population – including the teachers, doctors and nurses who work in the public sector – we are just faces outside windows and demographics on reports.

  • Stef Viljoen Viljoen says:

    Ask “our people” and the comrades to stop stealing my illustrious leader. That will give you a little more margin to care for those that cannot afford services.

  • Jimbo Smith says:

    The utterings of this “Minister” are ludicrous and an insult to the citizens of this country. Public Health is an unmitigated disaster due to the sheer incompetence of those in charge. There are multiple reports of failures in hospitals across the country. Had the snouts not been slobbering in the trough stealing at every opportunity, likely there would have surplus funds. Every “Ministry” will now put forward the same pathetic plea and in the process ignore the impact of their catastrophic incompetence and industrial scale theft and corruption.

  • Gary De Sousa says:

    So if salaries and wages are the biggest cost ,you know where to start dont you.?

  • Mark Gory Gory says:

    Vefore they cut on health, best they trim useless ministerial “security “ blue light brigades and a few dozen pointless ministries…..
    Maybe a relook at pointless staffers on govt departments? Less entertaining and more modest funerals?
    Get with the real world, anc

  • Catherine Bell says:

    Who’s he kidding? This IS NO health service!!!

  • Harold Rundle says:

    If half the workers did half of their required work half the time, we would be better off than we are now.
    The unions are responsible for a mindset of more money for less work.

Please peer review 3 community comments before your comment can be posted


This article is free to read.

Sign up for free or sign in to continue reading.

Unlike our competitors, we don’t force you to pay to read the news but we do need your email address to make your experience better.

Nearly there! Create a password to finish signing up with us:

Please enter your password or get a sign in link if you’ve forgotten

Open Sesame! Thanks for signing up.

We would like our readers to start paying for Daily Maverick...

…but we are not going to force you to. Over 10 million users come to us each month for the news. We have not put it behind a paywall because the truth should not be a luxury.

Instead we ask our readers who can afford to contribute, even a small amount each month, to do so.

If you appreciate it and want to see us keep going then please consider contributing whatever you can.

Support Daily Maverick→
Payment options