Govt health scheme faces stiff resistance

via Govt health scheme faces stiff resistance – The Zimbabwe Independent November 1, 2013 by Elias Mambo

GOVERNMENT’S proposal to introduce a compulsory health insurance scheme for employees appears set for stiff resistance from overburdened Zimbabwean taxpayers whom some statistics show constitute a mere 20% of the employable population.

Two weeks ago Deputy Health minister Paul Chimedza said government was holding discussions to introduce a new compulsory fund to finance health care in a holistic manner.

Chimedza told parliament: “The two ministries (Health and Labour), at some point, had proposed that there be a National Health Insurance Fund and that this fund comes as a levy, not just focusing on cancer, but focusing on the whole health-care sector and for anyone who gets sick, whether in the rural areas or towns, he/she just needs to walk to the hospital and get service, but that service will be paid for from that fund and then that health institution will be able to pay its workers — the nurses and doctors.”

According to government, the fund would cushion workers who cannot afford high medical aid fees being charged by medical aid societies, including government’s Premier Service Medical Aid Society.

Although the idea sounds noble, the challenge is that it adds to many other initiatives that have not fully benefited the targeted people despite burdening the taxpayers most of whom survive on meagre salaries.

Zimbabwe Congress of Trade Unions (ZCTU) and some analysts pointed out that other compulsory schemes such as the Aids levy and Nssa pensions scheme had not fulfilled expectations, with questions lingering over how the funds were and are being used.
Last week, ZCTU secretary-general Japhet Moyo vowed his union would resist any new compulsory levies on employees until issues to do with the management of the fund are thoroughly interrogated and agreed on by contributors.

While the introduction of the health levy might bring relief to ordinary people who can no longer afford the rising costs of health services and health insurance being offered by public and private medical aid societies, questions remain over government’s management of such funds amid suspicions of abuse.

Economist Vince Musewe said while such schemes are welcome as they would provide relief if well administered, they were not producing the desired results because of the corrupt nature of the government system.

“Any system that is corrupt at its core will always create other corrupt institutions,” Musewe said.

“We can never expect to get apples from a mango tree and so let us not expect to get organisations such as Nssa operating outside the grand agenda of incompetence, non-delivery and lack of transparency; for that is the nature of the Zanu PF government.

“Our whole savings industry needs to be rehabilitated to ensure transparency and fair business practices. Zimbabweans are an abused people who have become so used to that abuse that they now accept it as normal,” Musewe said.

The pension fund under Nssa management has been under the spotlight for failing to adequately reward pensioners while contributions were allegedly being used for investments and huge salaries for top managers.

Despite the Aids levy, public hospitals are currently failing to meet the demand for anti-retroviral drugs (ARVs), placing the lives of thousands of patients at risk.

In 1999, the government introduced an Aids levy on all taxpayers to fund the work of the National Aids Council (NAC). The 3% levy deducted from the workers’ salaries was introduced to help finance HIV and Aids programmes, particularly ARV purchases, but the NAC has consistently come under fire for failing to use the funds to improve the welfare of people living with HIV and Aids.

Two years after introducing the controversial levy, the government in 2001 ordered an investigation into the administration of the levy amid allegations of massive looting of the fund.

In September this year NAC was slammed for failing to provide ARVs to more than half a million people living with HIV and Aids, forcing patients to switch to drug combinations which further endanger their lives.

However, NAC chief executive officer Tapuwa Magure denied that the country was experiencing ARV shortages, instead blaming “logistical problems” in the distribution processes of the drugs for the scarcity.

Magure also said this year NAC would collect US$33 million through the Aids levy and only US$20 million will be used to buy ARV drugs while the remainder would be used for prevention, awareness campaigns and monitoring and evaluation.

But Zimbabwe HIV and Aids Activist Union vice-president Stanley Takaona blamed the shortage of drugs on poor management of the Aids levy.

“Government has failed to properly manage the Aids levy which is meant to procure these drugs,” Takaona said.

Another analyst, Alexander Rusero, said over-taxation of workers is an indication of a non-performing government which would want to sustain its livelihood from the sweat of underpaid workers.

“Any desperate government in a non-performing economy would want to squeeze the workers for its livelihood by (war) taxing them,” Rusero said.

“A clueless government gives workers paltry wages and deducts from them high taxes which are then abused instead of providing the services meant from the taxes. A good example is the Aids levy, whose funds have been used for workshops; where authorities are dining and wining instead of procuring the much needed ARVs.”

Rusero added government should come up with innovative ways of attracting investors instead of further burdening workers.

“We cannot continue to have a tax-driven economy because tax is not a panacea but there should be ways to lure investors,” he said.

Nssa has been in the limelight for reasons ranging from paying retired members paltry pensions with a minimum retirement pension increased from US$40 a month to US$60 as of August, while the minimum survivor’s pension and invalidity pension rose from US$20 to US$40 per month.

Pensioners and legislators once described the money as a “pittance” which is not even enough to cover travel expenses incurred to collect it. While pensioners are being paid “peanuts” Nssa, among other investments, is the majority shareholder in Rainbow Tourism Group (RTG), with more than 50% equity held directly and indirectly through various investment vehicles.

Recently RTG was awarded a management contract to run the Beitbridge Hotel while Nssa also extended a US$4,4 million loan to equip the hotel.

ZCTU’s Moyo said the introduction of government schemes such as the such as the proposed health scheme should be resisted in strongest terms.

“This is something we rejected a long time ago and we will reject (it) again,” Moyo said. Under Nssa, workers’ money has been abused with some (of the money) now being locked up in non-performing banks.”

Zimbabwean workers are among the highest taxed employees in the world with a plethora of direct and indirect taxes in a shrinking economy where a small minority employed in the formal sector has to help finance government operations.