"The Elders" and South Africa’s NHI: Idealism meets governance reality - Corrigan

Key topics:The Elders’ support for South Africa’s National Health Insurance (NHI)Governance, corruption, and funding flaws in South Africa’s health systemThe limits of global moral authority in addressing local policy realities.Sign up for your early morning brew of the BizNews Insider to keep you up to speed with the content that matters. The newsletter will land in your inbox at 5:30am weekdays. Register here.Support South Africa’s bastion of independent journalism, offering balanced insights on investments, business, and the political economy, by joining BizNews Premium. Register here.If you prefer WhatsApp for updates, sign up to the BizNews channel here..By Terence Corrigan*.For leaders whose position has given them a prominent profile, departure from office opens an interesting array of possibilities.The president, the central bank governor, the senior international civil servant has probably lived through and participated in things of great importance and may have developed an insider understanding of these matters. Such a person would also be well connected, with professional and personal relationships that only years of access could make possible.This sort of positioning is rare, and marketable. It’s a stimulating and possibly lucrative career path: books, lectures, legacy foundations, think tank fellowships, directorships and the not inconsiderable satisfaction of being regarded as an authority on politics and governance (but above the petty partisan fray and without the burden of having to take responsibility for them). Such a person is what we call an elder statesman.For a select few, there is something even more enthralling: taking this role global. This demands worldwide recognition and associations, as well as a broad understanding of one’s identity – to regard oneself as having graduated from the confines of national citizenship to that of the world. Paired with that today is a sense of particular moral authority.Nothing better illustrates this than the colloquium called The Elders. While elder statesmen are typically described as such by others, this group appropriated the name for themselves. Reportedly initiated by businessman Richard Branson and musician Peter Gabriel, the colloquium was launched by Nelson Mandela during his 2007 birthday celebrations. Its intention was expansive: to advance peace, common humanity, respect for human rights, to defeat poverty and to enable each person to live a dignified life.It was hoped, Mandela said, that the group’s members would be “real role models”. They certainly had the profile, most having served as heads of state, prominent rights campaigners, and directors of United Nations agencies. Most came from middle powers, although the initial line-up included former US President Jimmy Carter. Carter expressed hope at the time for the success of the initiative “through sound judgement and through dedication and courage”.For South Africa, this has taken shape in the form of the group’s activism around healthcare. It has made Universal Health Coverage (UHC) a focus area and has latched on to South Africa’s proposed National Health Insurance (NHI) as an exemplar of how to achieve it.Last Monday, Business Day ran an opinion piece by Helen Clark, former New Zealand Minister of Health and Prime Minister, as well as Administrator of the United Nations Development Programme between 2009 and 2017..Effusive.With the meeting of the G20 health ministers in mind (convened last week), she was effusive in her enthusiasm. Here was an opportunity to assert a leadership role in the world, not only in terms of ideas, but to demonstrate how it was being applied at home. The NHI Act, she wrote, was “one of the most ambitious social reforms in the country’s democratic history”; it was an opportune moment to push aggressively ahead with the reforms to make it a reality.“SA’s history shows that it will undertake bold reform when the moral case is clear and leadership is strong,” she continued, invoking South Africa’s national mythology. “Just as the country once overcame apartheid and built a democratic constitution admired around the world, it can now address health inequalities decisively and deliver on the promise of universal care.”UHC – enabled by the NHI – would lead to a healthier population, improved health security and pandemic preparedness, higher workforce productivity and accelerated economic growth, reduced inequality, and would promote social solidarity and peace. She pointed to her native country, which had moved in this direction as early as 1938, as an example of the benefits.Stay the course, she advised, and fight off the naysayers and the selfish. “Such transformation will not be easy. Building an effective NHI system will require strong governance, sound public financial management and clear communication with citizens to maintain trust. There will be vested interests that resist change, and there will be complex technical challenges along the way. But the long-term benefits – for health, for equity, for the economy – vastly outweigh the short-term difficulties.”This was not the first time that The Elders had expressed support for the NHI. In 2019, represented by onetime Mozambican Minister of Education and Culture and women’s rights advocate (and Mandela’s widow) Graça Machel, former Norwegian Prime Minister and Director General of the World Health Organisation Gro Harlem Brundtland, and former Chilean President Ricardo Lagos, The Elders accompanied then Minister of Health Zweli Mkhize on visits to public health facilities, met various role players and fulsomely endorsed the NHI. Per their media statement: “They said it was important for the NHI reforms to be based on a publicly-funded single-payer system, and to focus on primary healthcare and preventive measures.”.Social solidarity.In a vocabulary predicting Clark’s, they extolled the NHI as a mechanism for equity and for social solidarity. It would “offer a critical opportunity for South Africa to improve delivery and accountability in the health system, tackle corruption.” The experiences of their own countries showed that such systems could be introduced even in trying economic circumstances. And they were notably upbeat on its prospects. As Lagos put it: “I have no doubt that all South Africans, from the President to front-line health workers, have the resilience and commitment to deliver UHC in an accountable, inclusive and fiscally-responsible manner.”It bears repeating that The Elders were not undertaking advocacy for UHC as a general ideal; they have expressed support for a specific policy and a particular law. If, as elder statesmen, their intention is to use their influence and insights to make a positive difference, their assertions must be measured against the specific and particular circumstances prevailing in South Africa.In theory, South Africa already provides “free” healthcare, in the sense that public facilities are meant to provide care, even to those without the means to pay. The broad contour of the problem is that public facilities are unable to meet immediate demand. The examples are well enough known: long queues, insufficient ward space, shortages of doctors and nurses, broken or missing equipment, clinics without medicines.The NHI is premised on the idea that this is fundamentally all about money; that is, that these problems would be substantively alleviated by increasing the quantum of funds available to the state.So, how does South African spending stack up globally?The world as a whole spends some 9.9% of its GDP on healthcare, with 6.1% being government spending (figures from the World Bank database). South Africa’s numbers are 8.8% and 5.4% respectively. However, its spending on both measures exceeds that of its upper middle-income peers: 5.6% in total and 3.1% in state spending..State resources.Relationally, South Africa already puts a large amount of money – and a large proportion of its resources, not least its state resources – into health services. Chile, New Zealand and Norway (represented by Lagos, Clark and Brundtland respectively) are all high-income countries, with total health expenditure standing at 10.1%, 10% and 7.9% respectively; state spending comes in at 5.1%, 8,1% and 6.8%. Interestingly, while higher-income countries tend to spend a larger proportion of their income on healthcare than those at lower levels, South Africa’s state expenditure as a proportion of GDP actually surpasses that of Chile – while Chile’s non-state expenditure outstrips South Africa’s.These are of course crude and unnuanced measures. None of this is to say that money is not an important issue for South African healthcare, but the above comparisons should give pause for reflection on whether insufficient resources – and insufficient resources in the hands of the state – are the defining problem.Yet this is the NHI’s reasoning. The broad plan is that the NHI would become a virtual monopsony, pooling funds currently raised for healthcare via taxes, redirecting the spend on private health insurance through mandatory levies (initially through removing tax credits, later through additional taxes), and possibly imposing further taxes to make up whatever shortfalls might exist. The NHI, contrary to some of the discussion around it, would not nationalise private health infrastructure, but would effectively nationalise the money.Private facilities and doctors in private practice would, in principle, continue to operate subject to accepting government conditions, at least on current plans as they have been presented. Price controls have been mentioned, and it’s hard to avoid the conclusion that doctors and other medical personnel would become something akin to civil servants, and that suppliers to the medical sector would be extraordinarily exposed to government demands. Private medical aids would have no role, beyond perhaps some supplementary services. It’s not clear whether they would be prohibited outright or would simply be rendered obsolete by the operation of the law..Never been specified.However, exactly what the NHI would offer has never been specified. Nor has it been properly costed. What would South Africans collectively – or individual hard-pressed South African households – pay for this project, and what would they get for it? No one knows, and without this information, proper deliberation has been all but impossible.This has had the effect of shifting a lot of public debate on the matter – particularly for its proponents – into moralistic territory, where only callous disregard for “the poor” could possibly account for opposition to the NHI. After all, if this is a matter of human rights, the grubby rands and cents have no role to play. South Africa has heard this before, notably over the arms deal scandal in the early years of democracy, when the then Minister of Defence called for an approach that was “visionary” and dispensed with cost concerns. That didn’t work out too well.All this rather gives the lie to Lagos’s confident prediction “that all South Africans, from the President to frontline health workers, have the resilience and commitment to deliver UHC in an accountable, inclusive and fiscally-responsible manner.”South Africa hasn’t come close to such a discussion, let alone an accord.Indeed, the tenor of the public conversation, particularly from political interests driving it (perhaps less so among those technocratic interests in favour), has been profoundly political and overtly divisive. Business has complained that its own suggestions have been roundly ignored.To suggest that the NHI would promote social or political harmony is simply to mistake the nature of South Africa’s politics, its populist impulses and the cold chill of ideology that covers it.The African National Congress (ANC) and its offshoot parties have never abandoned the idea that they are engaged in a struggle against “enemies”, with policies like the NHI being a front in that fight. Even the signing of the Act was clearly intended as a part of the ANC’s electoral campaign, coming as it did mere days prior to last year’s polls. Perhaps The Elders remain beguiled by the mythology of South Africa as a country uniquely given to dialogue, of the miracle transition and of the towering charisma of Nelson Mandela..Disservice.This was never true, and is untrue now, and they do a disservice to South Africa if they cling to that narrative, and to their own credibility if they base their analysis on it.Interestingly, a subtext to the ANC’s campaign around the NHI has been that private health facilities will become accessible to everyone. Gauteng Premier Panyaza Lesufi, never one to restrain himself, was captured on camera during the election campaign last year promising a crowd that after the elections they could present themselves at private hospitals for treatment “by experts” without needing to pay. He also made a strange promise that his province would buy 18 private hospitals (at which point, they would presumably become public…).Unwittingly, he was conceding something very important: that South Africans have a positive view of private healthcare, more so than of its public counterpart. Indeed, the signing of the NHI Bill into law coincided with a rapid deterioration in the ANC’s political standing (reflected in opinion polling). It backfired politically. Dr Frans Cronje, whose polling identified the drop, attributed it to a sense among many of its traditional supporters that private healthcare was a positive good, something that they aspired to access, or did so out-of-pocket even in the absence of private medical insurance. The idea of extending state control over it (the state as it exists) was simply not popular.As an aside, South Africa’s political elite have seldom been shy about availing themselves of private healthcare: in his final months, Nelson Mandela spent a considerable stretch in Pretoria’s Mediclinic Heart Hospital.This is a low-key (and quite respectable) variation on widespread practice in the developing world. Leaders are seldom personally locked into the consequences of their domestic agendas, neither in office, nor when they set out to take their agendas to a wider audience, as elder statesmen themselves.Robert Mugabe regularly sought medical treatment abroad, and died in a state-of-the-art facility in Singapore. Julius Nyerere, who had built a personal brand on the denunciation of the inequities of capitalism and the global order and the need for homegrown, equalitarian African solutions, died in a private clinic in London. The same could be said of Malam Bacai Sanhá (Guinea-Bissau), Kamuzu Banda (Malawi), Omar Bongo (Gabon), Michael Sata and Edgar Lungu (both of Zambia) and Gnassingbé Eyadéma (Togo) – although he died en route to treatment in France, so didn’t quite make it)..Pathologies of governance.That is particularly unsurprising since South Africa’s public health system has been very much the focus of some of the worst pathologies of governance. If anyone exemplifies the extent and implications of these, it is Babita Deokaran. A dutiful civil servant, she attempted to alert her superiors to corruption at Tembisa Hospital during the Covid pandemic. The Special Investigating Unit, in its report some years later, identified three syndicates operating at the facility, and the plundering of some R2 billion. For her troubles, she died in a hail of bullets in the driveway to her residential complex.In fact, Mark Heywood and Professor Alex van den Heever calculate that the Gauteng Health Department has lost some R20 billion to corruption in the past decade.Even the NHI – not yet operationalised – has not been spared the odour of malfeasance.In 2020, among the looting of Covid funds, it emerged that an irregular contract to promote the NHI had been issued. This was the so-called Digital Vibes scandal, in which politically connected people – including the then health minister’s family (the minster being Zweli Mkhize, who had shown The Elders around health facilities the year before) – had benefited from a departmental contract with a communications firm. In other words, long before the Act was even signed, the NHI was being looted. This is sadly all of a piece for South Africa.Clark’s article made no mention of any of this.Nor, indeed, has the state since 2019 taken advantage of the “opportunity” which The Elders claimed that the NHI represented to deal with corruption in the health system – though why one would need an “opportunity” to take action that should be foundational is somewhat hard to understand..Some irony.With some irony, on the same day that Clark’s contribution ran, Currency News published a critique of the government’s approach to the NHI. It makes the point that not only has its design failed to take account of hard realities, but it was mirroring the practices that have hobbled the country’s existing public health system, just making it responsible for a quantum leap in demands for more money. Chief among these is that the board of the NHI will be appointed by the minister. It quotes Van den Heever as saying: “You’re giving a system that’s failing a bigger budget and fewer checks. The NHI does nothing to fix the governance crisis. It actually accentuates it because it keeps the political-appointment model that’s driving the corruption.”This speaks to a broader problem in the South African state: its deficient administrative capacity. This is the outgrowth of long-standing policy and political imperatives that have privileged demographics and political loyalty above skill and experience. It was under Mandela’s presidency that the ANC undertook a deliberate and counter-constitutional programme to politicise the state institutions that were enjoined to be professional and non-partisan. It’s a warning against romanticising South Africa’s history and those who feature within it.The notion that a massive consumption programme – probably replete with premiums for “empowerment” purposes – would in the current circumstances not be a source of plunder and patronage is naïve beyond belief. Possibly wilfully so.The NHI Act is certainly one of the most ambitious projects undertaken post-1994, though perhaps not for the reason Clark assumes. Given the stakes involved, it stands to be ruinous for South Africa, and it’s doubtful that it would do much to elevate the provision of healthcare. Money is just one issue among many, and far from the most important..Implausibility.All told, the implausibility of the NHI reflects very poorly on the endorsement extended by The Elders. Note, again, that they have come out in favour not of a general principle, but of a specific policy.This is not only germane to this group, but to the whole idea of invoking reputation to, well, improve the world.This applies to elder statesmen certainly; across the world – and especially in Africa, where institutions are often weak – so-called “eminent persons” are a common feature of conflict resolution and governance reform initiatives, as is the directing body the African Union’s (AU’s) African Peer Review Mechanism or the Panel of the Wise in the AU’s Peace and Security Council. It applies to religious leaders and academics, as well as actors, musicians, artists and authors, people who in a celebrity-besotted world see a role for themselves in contributing their talents to resolving weighty problems. The UN even ropes some of them into its work as “Goodwill Ambassadors”.But past successes or current popularity say little about their suitability to offer advice on matters whose details they are not familiar with. One is reminded of Thomas Sowell’s observation about intellectuals: there is a tendency to assume that expertise in one field gives insight into things quite unrelated. South Africa is not New Zealand, Chile or Norway, in just about any respect relevant to its healthcare challenges.One could, of course, make an argument for the sort of single-payer system that The Elders favour; but whether these are good or bad arguments is another matter. If Clark, Lagos or anyone else wishes to do so, a suitable recognition of reality would be an asset. This would, in South Africa, be uncomfortable. Elder statesmen would be loath to antagonise the authorities of a state to which they clearly feel warmly disposed. But if they seek to live up to their own self-conception as global role models (The Elders, remember), they would need to take that on. Not everyone in public office meets their purported level of probity. And “speaking truth to power”, as the dreadful cliché has it, is not a comfortable business, though it is one that those connected to power are well placed to do..Starting point.A plausible approach would be something along these lines, whose starting point would be from The Elders’ own document on UHC: “In every case, this has been achieved by countries increasing the supply and quality of health services and reducing barriers that stop people accessing care.”Building on this, they might argue that if NHI is indeed desirable, it cannot be actuated without a strong public health system. This does not exist in South Africa, nor has the state shown more than a lukewarm attitude towards creating it. This must be the first order of action, and demands the prudent stewardship of resources.Part of this means that funds meant for healthcare must be dedicated to healthcare only. Money put into the system has a duty to work for the wellbeing of (particularly) the country’s poorest people, not for any other purpose. Certainly not for connected businesspeople. Empowerment policy and the premiums it distributes must be abandoned in favour of value for money. To do otherwise is to erect precisely the sort of barrier that The Elders’ document decries.It also means professionalising the administration of the health system, and radically improving accountability within it. This means rooting out the criminals, actually prosecuting the corrupt, and managing the performance of staff.Like much else in South Africa’s public realm, healthcare has offered numerous employment sinecures with strong, politically sensitive union protection. This is not only to the detriment of health provision, but grotesquely unjust to the dedicated professionals in the system, of whom there are many. As politically unpalatable as this may be, it is essential.Increase the supply of medical skills. Again, if healthcare is the objective, the counterproductive hostility to private sector training needs to be abandoned. This is all the more so, given that the NHI purports to plan to buy services from the private sector. Why not allow it to supply doctors as well as diagnoses and defibrillators?.Squandered.The state further needs to understand that its small, shrinking and stressed cohort of taxpayers is a limited resource to be nurtured. Decades of watching tax receipts squandered, and having to make alternative (private) arrangements for services that are nominally provided by the state have done great damage to the social contract.There are serious questions to be asked about whether the South African state has the moral right to make further demands. It has proved to be a poor steward of society’s resources, and has shown little respect to those who have created them. Much of the messaging around the NHI has veered into an untidy populism about how the “rich” need to step up to help the “poor”. Some humility here would be well advised, along with practical action to address the concerns that the more affluent in society will be feeling. This in itself is likely to be a long-term project, its success contingent on the state showing that it is able competently to manage the public health system as it exists now.Above all, perhaps, is the need to accelerate economic growth. Two decades of anaemic economic performance have left the state at a fiscal precipice, and South Africa’s people not only poorer, but also deeply sceptical about the future. Hence the fact that emigration appears to be riding at a level comparable to that of the unstable mid-1990s, and now reflects the full diversity of the Rainbow Nation. New Zealand has been a favoured destination, and it has welcomed the skills and taxpaying contribution that such emigrés provide; with NHI, it might anticipate many more applications from Sout Africans, more than a few of whom would offer their talents to that country’s health system. (It is doubtful this would be rejected – solidarity, after all, has limits). Redistributive policies are only possible with the resources to underwrite them, and in a democracy, with the buy-in of the population. Turning to the NHI as a policy, it is utterly implausible in the absence of proper costing. What will it cost, what will it offer, how will it be introduced? Mandating it through a law in the absence of a proper financial plan was both cynical and reckless; if anything, doing so has undermined the prospects for its successful introduction, and certainly in the spirit of societal partnership and cooperation that it would depend on. The voices of global “role models” might wish to point this out. .Minimum reform.The legislation itself needs to be re-examined. The IRR has expressed opposition to the whole proposal, but for those hoping to make the NHI model work, a minimum reform would need to remove the political influence inherent in the proposed design.As has been noted, it merely reproduces the approach that has already beggared not just public healthcare, but the South African state as a whole. Far better, perhaps, to place it under an independent board of non-aligned experts – perhaps a role for some of The Elders? Maybe it would be preferable to have the board appointed by Helen Clark, Gro Harlem Brundtland and Ricardo Lagos (though given her connection to South Africa and its politics, Graça Machel would be unsuitable), rather than by Minister Aaron Motsoaledi.And then, there may be a need to demonstrate what is arguably the signature of greatness: humility.However fondly one may regard an idea, if it is not practicable, or if it cannot reasonably be implemented, or if doing so risks adverse consequences that outstrip any conceivable benefits, then it should be postponed or abandoned. To quote the late Carl Sagan: “Whatever is inconsistent with the facts must be discarded or revised. We must understand the Cosmos as it is and not confuse how it is with how we wish it to be. The obvious is sometimes false; the unexpected is sometimes true.”The NHI, no matter how fond of the idea some may be, is currently unworkable. This is the case with numerous policies, given the state of South Africa. The Elders should acknowledge that, and, if serious about their mission, speak frankly about it. So should anyone aspiring to play such a role. Reputation without responsibility neither carries authority nor commands respect.The Elders hoped to make their mark “through sound judgement and through dedication and courage”. On this issue, they have yet to demonstrate it..*Terence Corrigan is the Project Manager at the Institute..*This article was originally published by Daily Friend and has been republished with permission.

"The Elders" and South Africa’s NHI: Idealism meets governance reality - Corrigan

Related Stories

Despite court defeat, govt still wants to steal your healthcare

SA businesses battered by infrastructure instability - Muhammad Ali

How can you thrive in South Africa’s enclave future?

John Endres: The contradictions of NHI defenders