Gauteng health criticised for poor financial planning

October 22, 2008

Gauteng health criticised for poor financial planning

Chantelle Benjamin
Chief Reporter

THE auditor-general has criticised the Gauteng health department for R805m in unauthorised expenditure, and for underspending on hospital equipment and ambulances.

These were some of the findings in the department�s 2007-08 financial report, which suggests poor financial planning and raises concerns about the effect of this on service delivery.

Shortages of all manner of equipment were reported at Charlotte Maxeke Johannesburg Academic Hospital (formerly Johannesburg Hospital) and Chris Hani-Baragwanath. There was public outrage last year when it was found that babies were sleeping in boxes because of a shortage of cots at Chris Hani-Baragwanath.

The department received a qualified audit. Some of the reasons were that it could not account for R46,7m in assets, and it failed to collect R761m in outstanding patient debt, of which R613m was outstanding for more than 90 days.

It was also found that 16 contracts to the value of R36m were awarded without the prescribed bidding process being followed.

The department overspent on its R12,446m budget by R640m in district healthcare, provincial hospital services and central hospital services. The bulk of this overspend, or R405m, went to central hospital services.

The department also overspent in the previous financial year by about R500m.

The reasons given by the department for the central hospital costs included the national health department�s implementation of the Occupational Specific Dispensation, which is intended to retain nursing staff through graded remuneration, and continuing dependence on private nursing agencies, as well as increased expenditure on laboratory services and nonpharmaceutical items, both of which were up over 8% on the previous financial year.

The Occupational Specific Dispensation was also listed as the main reason for overexpenditure of R197m at provincial hospitals.

Democratic Alliance health spokesman Jack Bloom said on Friday the overspending could have been offset if the department had collected outstanding patient debt. �Most of this patient debt is from medical aids, other government departments and other provinces,� he said.

BUSINESS DAY 20th October 2008

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