Apart from the impact of the strike on staff and people depending on the public healthcare system, the strike also put the spotlight on the Eastern Cape Department of Health’s ability to pay service providers and ensure that critical services are not interrupted. Opposition politicians think more such disruptions are likely.
The security guards in question are employed by the company Silver Solution Security, which is contracted to provide security services to all public clinics in the Nelson Mandela Bay metro.
The broad contours of what happened are familiar enough.
The striking workers accused the company of not paying them their December and January salaries. In turn, the company’s Port Elizabeth branch manager, Mark Damons said that the workers weren’t paid because the company was facing “dire financial constraints” because the provincial health department was late in paying them. He said workers had been paid from the company’s reserves. On 28 January a report on ENCA quoted the province’s Department of Health as saying that payments had been made to the company, but that there was a short-fall that had then been corrected.
Impact on security
Before trying to understand the underlying reasons for such payment delays, it is worth stressing that the consequences of disrupted services can be real an serious.
On 26 January, day two of the strike, a group of armed men entered the KwaMagxaki Clinic and robbed three nurses of their mobile phones. Eastern Cape Health MEC Nomakhosazana Meth condemned the robbery and described the incident as “thuggery”.
At four clinics visited by Spotlight, healthcare workers blamed the provincial health department for putting their lives in danger after failing to pay security guards.
A day after the robbery at the KwaMagxaki clinic, nurses were undergoing a counselling session after the robbery. A visibly traumatised nurse said, “We were on lunch when two gunmen entered the clinic via the back door. They pointed firearms at us and demanded our cell phones and car keys before locking us inside the clinic. What happened to us is very traumatic,” the nurse said, “and it will have an impact on our ability to deliver quality healthcare to our patients.”
The strike also meant that some people in need of healthcare arrived to find clinic gates closed. Langalase-afrika Diamond who accompanied his wife Lonwabo for a medical check-up of their two-week-old baby to KwaMagxaki clinic had to leave without being assisted. “We only discovered that the clinic was closed when we arrived here. We have an appointment for today. Now we don’t know where to go to and we are not aware when they will open. If we knew that we would not get help here, we would have stayed at home instead of moving around with the newborn baby,” Diamond told Spotlight at the time.
Although the security guards are back and the clinic gates open, the strike due to non-payment has once again laid bare how budget constraints are affecting the delivery of healthcare and related services.
In a statement released in January, provincial health spokesperson Mkhululi Ndamase acknowledged the department is “having serious budgetary constraints having started the current financial year with an R4.4 billion shortfall because of medico-legal claims accruals and payables”. These budget constraints, among others, meant the department could not extend contracts of healthcare workers and is now trying to source more funding. The statement was issued in response to disgruntled healthcare workers who demanded their contracts be extended.
It seems budget constraints due to ballooning medico-legal claims, are now also impacting the department’s ability to pay service providers like security companies on time. Asked about this and specifically the department’s budget for hiring private security companies, Ndamase referred Spotlight to the Department’s spokesperson Yonela Dekeda. Dekeda acknowledged Spotlight’s questions but failed to provide a substantive response since first being contacted on 27 January. She eventually said Spotlight should go ahead and print this article without the department’s input.
‘Bankrupt and unable to pay’
Ballooning claims for medical negligence and the impact it has on health budgets and service delivery is not just limited to the Eastern Cape. In its 2020/21 audit report published in December last year, the Auditor-General said there was an increase in medico-legal claims throughout the health sector. Actual payments made in lieu of medical negligence claims in the 2020/21 financial year, amounted to R1.7 billion. The total claims against the health sector amounted to over R100 billion. “If these claims are unsuccessfully defended and need to be paid out, it will further erode an already stretched budget and have a negative impact on service delivery,” the AG warned. “This financial strain also led to an increase in unpaid invoices (accruals) amounting to R15 364 million (R15.4 billion).”
In the Eastern Cape, the balance for medico-legal claims had escalated to R38 608 million (R38.6 billion). “The department has an approved overdraft facility of R1 000 million (R100 billion) to help it pay these medico-legal claims, which are not within its budget. There has also been an increase in instances of the department’s bank accounts being attached due to attorneys approaching the courts. This means that at specific points the department may not be able to transact in its own bank account and has resulted in funds being transferred from other service delivery areas to pay for these medico-legal claims,” the AG said in the report.
DA MPL and spokesperson for health in the Eastern Cape, Jane Cowley, says the provincial health department is “bankrupt” since it cannot pay service providers. She says it is not only security services but also other suppliers across the province that have not been paid.
“Companies providing medical equipment, surgical equipment, soft service, and oxygen companies have to wait until the new budget allocations in April before receiving any funds,” she told Spotlight. “Critical medical supplies for the rest of the financial year could very well be delayed, as the department does not have the money to pay for them.”
According to Cowley, the department in January requested an additional “R5.2 billion from the provincial treasury for the current financial year, of which R4.4 billion was for accruals and payables”. “The Provincial Treasury noted that they could only provide R280 million in additional funding for health, roughly 4.4% of what was asked for.”
Cowley called it a shame that the department cannot protect their workers by paying security guards who protect these workers and their assets. “We are in this mess because of years of mismanaging the budget and allowing medical claims to grow without any settlement plan. As a result, citizens of Nelson Mandela Bay and the health workers are affected because the department is currently unable to meet its financial commitment for the financial year.”