News in South Africa 12th May:

1. Health sector understaffed:

The South African Medical Association (SAMA) says that the government is setting up the country’s healthcare sector to fail by not hiring or training enough doctors or nurses and other healthcare professionals.

Health sector understaffed
Image taken by: Laura James

Responding to comments made by health minister Joe Phaahla this week that the country currently has a doctor-to-patient ratio of only 1 doctor per 3,198 people. Phaahla described it as a ‘shocking state of affairs’.

SAMA chairperson Dr Mvuyisi Mzukwa said that the figure lays bare South Africa’s healthcare problem – where the sector is understaffed, overworked, and money meant for equipment or patient care is funnelled elsewhere.

“If you allow one doctor to attend to such a large population…the quality of service is going to be compromised, and that can lead to litigation. The money that has been given to provinces won’t be going to services, it will be going to litigation,” he said.

Mzukwa said that, unless the government sorts out the issue of staffing, it won’t solve the “problem on the ground”.

Healthcare professionals are exhausted. We’re post-pandemic, or still dealing with the pandemic, but we’ve been through this for two years,” Mzukwa said. “They (healthcare workers) are incapacitated. Instead, you get lip service from the health minister, calling them ‘frontline warriors’ – but who is supporting them? Who is capacitating them?”

Phaahla acknowledged the need for more healthcare workers in his budget speech, and announced that at least R7.5 billion had been set aside for the hiring and training of community healthcare workers and medical interns over the next two financial years.

He said that 2,429 medical interns, and community service personnel – amongst them doctors, nurses and pharmacists – were employed during the current financial year.

“Progress has been made with regards to the stability in the employment of more than 47,000 community health workers, even though more work still needs to be done to finalise the nature of their long-term engagement,” he said.

R2.1 billion has been allocated over the next two financial years for medical interns, and a total amount of R5.4 billion has been allocated in the coming financial year to support various aspects of Health Professions training in provinces, including additional personnel where necessary, he said.

Despite this, the Democratic Alliance has pointed out that 21,000 specialist medical personnel posts are still vacant across all nine provinces, which the national Department of Health has yet to fill.

2. 10 017 New Covid cases:

South Africa recorded 10 017 new Covid-19 cases on Wednesday, according to the National Institute for Communicable Diseases (NICD).

“Today, the institute reports 10 017 new Covid-19 cases that have been identified in South Africa, which brings the total number of laboratory-confirmed cases to 3 862 165,” the NICD said in an update on Wednesday.

According to the government agency, this increase represents a 25.3% positivity rate.

The NICD is a division of the National Health Laboratory Service, which provides laboratory-based surveillance to inform the health response towards Covid-19 in South Africa.

Provincial breakdown

The highest percentage, 39% of the new cases are from Gauteng, followed by KwaZulu-Natal with 21%.

The Western Cape accounted for 17% of the new cases, while the Eastern Cape and Free State each accounted for 6%. Mpumalanga and North West each accounted for 3%. The Northern Cape accounted for 2%, and Limpopo accounted for 1% of Wednesday’s new cases.

“The proportion of positive new cases/total new tested today [Wednesday] is (25.3%), and is higher than yesterday [Tuesday] (23.0%). The 7-day average is (25.1%) today and is higher than yesterday (24.7%),” the NICD further explained in its update.

In addition, the Department of Health reported 50 deaths and, of these, 10 deaths occurred in the past 24 to 48 hours.

3. Load shedding could worsen:

Never mind winter, load shedding is likely to get much worse from September and Eskom’s ‘mid’ scenario sees 37 days of load shedding until the end of August.

The winter base case scenario of the utility’s transmission unit (which is in its final stages of separation in the unbundling process) saw no load shedding with only R1 billion spent on diesel for the open cycle gas turbines (OCGTs) until August.

Segomoco Scheppers, Eskom’s managing director for Transmission, admitted yesterday afternoon that clearly this is no longer the case. Since April 1, the country  has seen more than 10 days of load shedding.

While outages ought to improve in the coming months and planned maintenance is deliberately reduced to levels below 3 000MW, it is not likely that the base case is realistic for the whole of winter.

Scheppers said the transmission unit’s plan is “tight” and that there is inherent uncertainty.

More likely as a ‘base’ scenario – certainly based on the last six weeks – is the operator’s second scenario which sees (on average) up to 13 500MW being offline due to breakdowns until the end of August. Here, load shedding up to Stage 2 will be implemented on 37 days. Diesel costs will be above R3 billion.

The current worst scenario as per the transmission unit’s plan is predicated on 15 000MW of generation being offline due to unplanned outages across winter. Here’s load shedding will be required on 104 days (the plan covers 153 days between April 1 and August 31) and the highest stage of load shedding will exceed Stage 3. Diesel costs will total more than R7 billion.

In the mid scenario diesel spend is between R500 million and R600 million a month, with load shedding on between six to nine days each month. In the worst case, this jumps to at least R1.2 billion a month (and as much as R1.8 billion) with load shedding on 19 to 22 days each month.

The problem is that the transmission unit’s plan in the mid scenario requires 23 days of Stage 2 load shedding in November at a cost of R2.5 billion and a further 15 in December (effectively every day until the country shuts down mid-month) at the same cost.

4. Debt surging higher:

South Africa’s rising inflation rates and stagnant incomes have created the perfect storm for surging debt as more consumers turn to credit cards and personal loans to make it through the month.

The economic fallout from the Covid-19 pandemic is still being felt by consumers. South Africa’s unemployment rate has risen to record highs, and for most of those who’ve managed to keep their jobs or find new ones during two years of widespread retrenchments, salaries have been cut, unchanged, or in the best-case scenario, matched with rising inflation rates.

As fears of a global recession mount and Russia’s conflict with Ukraine shocks commodity prices, consumers have already begun to feel the pain at petrol pumps and supermarkets. The cost of fuel, food, and electricity is soaring, with credit rating agency Moody’s predicting that inflation will rise to 8% in South Africa this year, far above the Reserve Bank’s (SARB) target band.

These rising costs of living and stagnant salaries are pushing more South Africans into debt as they attempt to supplement the shortfall in their monthly budgets, predominantly in the form of risky unsecured debt. The picture over a six-year period looks grim for South Africa’s consumers.

“Nominal incomes were slightly lower than 2016 levels, however, when cumulative inflation growth of 31% is factored in for the same six-year period, disposable incomes shrank by 31% over this period,” said DebtBusters of consumers who applied for debt counselling in Q1 2022.

“This means consumers are feeling like they are taking home 31% less today in real terms than they did in 2016.”

Real take-home pay in South Africa, as monitored by the monthly BankservAfrica Take-home Pay Index (BTPI), dropped sharply in March 2022.

“The average real salary was R14,969 in March, falling below the R15 000 mark seen in the previous months,” says Shergeran Naidoo, BankservAfrica’s head of stakeholder engagements.

“The real BTPI annual decline of 5.6% is one of the biggest annual falls on record.”

5. Railway revival:

If the government has its way, the Passenger Rail Agency of South Africa (Prasa) and Transnet are likely to have competitors in the passenger and freight rail markets, with a resulting improvement in the efficiencies of the entities.

The Department of Transport released the draft White Paper on National Rail Policy on Wednesday evening, two days after an event on Monday, during which Transport Minister Fikile Mbalula had originally aimed to launch the paper.

The white paper envisages improved state-owned freight and passenger rail operators through increased scope for competition, solutions to infrastructure vandalism and capitalised maintenance.

The draft policy comes at a time when the government’s two biggest rail operators are reeling from years of financial, operational and governance troubles.

Transnet registered its first loss in years last year and the entity’s rail performance is in freefall. Prasa still battles with leadership instability as it heads to court to fight for the removal of its axed group CEO Zolani Matthews.

Cabinet approved the latest draft of the white paper in March. The last iteration of the policy to be released by the government came out in 2017.

One problem the white paper identifies is dwindling funding for the government’s freight rail operator, which has been further constrained by Transnet’s recent underperformance, causing the entity to “restrict service output” to “maximise its financial performance”.

“Both freight and passenger rail markets are monopolistic. Furthermore, funding for both sub-models is inadequate. This has resulted in investment funding for freight rail being limited to what Transnet can leverage from its balance sheet which is not sufficient for its present needs,” the white paper said.

All information sourced from articles posted by: BusinessTech, News24, Moneyweb, Business Insider, and Fin24.

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