Over 130,000 jobs in South Africa at risk

 ·22 May 2024

Experts have warned the implementation of the NHI could threaten over 130,000 jobs in the public and private healthcare sector, but the Hospital Association South Africa (Hasa) says the devil will be in the details—once we eventually get them.

In the latter part of 2023, health economist and policy analyst Claire Botha noted that the implementation of the National Healthcare Insurance (NHI) would initiate a restructuring process that could result in provinces losing their health functions and shutting down Health Departments.

She explained that the implementation process would have similar effects to that of the establishment of the post-apartheid administration in 1994.

“The 1994 restructuring was characterised by much upheaval, with people being redeployed, retrenched, or retired,” she said.

Botha added that this would be the case for the NHI because there would be a mismatch between the skills required to run the insurance scheme and those working in public service.

Additionally, she said the Health Department will likely not have the required financial resources to accommodate everybody currently employed in administrative positions in the provinces.

This would likely result in very few public servants being absorbed into the NHI.

She estimated this process would impact around 130,000 administrative staff employed across South Africa’s nine provinces.

The Hospital Association of SA (HASA) noted a similar number of jobs at risk in the private sector during a Business Unity SA (BUSA) meeting in 2019.

HASA commissioned economics consultancy Econex to analyse the potential effect of the National Health Insurance Bill.

The report provided two scenarios to illustrate the economy-wide effect, with the worst-case estimating a loss of 132,000 jobs across the sector.

Wait and see

When asked to comment on its current views on job losses following the signing of the Bill into law this month, HASA told BusinessTech that a lot has changed since the report’s commissioning, and it would prefer not to speculate on potential job losses for now.

However, the association didn’t rule out the possibility of job losses as a result of implementing the NHI.

The association said the types of jobs that are most at risk depend on what services the NHI will implement through the main fund and what services will be covered by medical schemes.

“The details will spell this out, and we don’t have those right now,” said HASA.

Economist Dawie Roodt also noted that there would likely be more job losses in the private sector while the public sector will retain or even attract “hang-on” admin jobs that do very little to improve healthcare.

The president signed the NHI into law at a ceremony on Wednesday (15 May).

In his address ahead of the bill’s signing, Ramaphosa again rebuked critics, saying that anyone trying to maintain the status quo was out of line with the global imperative to pursue universal healthcare.

Amid the anxiety, Discovery chief executive officer Adrian Gore said the full implementation is a long way off, and many matters still need to be navigated.

“I urge you to focus on the facts. Rest assured that we will do the right thing for you, the healthcare system, and all South Africans,” he said.

One of the key problems with the new laws is that they lack certainty and detail about the way forward, especially in terms of capacity, funding, coverage and implementation.

The Department of Health and Ramaphosa have said that the implementation will be phased and in line with what the government has capacity for, with many of the details—like how it will be funded, what the NHI will cover, and how it will be implemented—coming at some mysterious point in the future.

Read: The twisted ‘good’ news about the NHI

Show comments
Subscribe to our daily newsletter