MTBPS – NHI and financial sector reform

In his Medium Term Budget Policy Statement (MTBPS) speech to parliament, Finance Minister Nhlanhla Nene mentioned both National Health Insurance (NHI) as well as financial sector reform.

NHI

Nene said under Minister of Health Aaron Motsoaledi’s guidance, NHI will be phased in, “drawing on the lessons of the district pilot projects.”

NHI is intended to ensure equitable access to health services for all South Africans and is being introduced over a 14-year period, reaching full implementation in 2025/26.  A White Paper is expected to be released before the end of this financial year.

Nene further emphasised that additions to health expenditure would further strengthen SA’s response to HIV and AIDS and scale-up interventions to address TB.

Health budgets are set to grow by 8.3 percent a year between 2015/16 and 2018/19.

FINANCIAL SECTOR REFORMS

Turning to financial sector reforms, Nene said the Bill to give effect to the Twin Peaks regulatory system had now been certified by the State Law Advisors and will be table next week.

“We have engaged with the industry and other stakeholders on the draft  framework for market conduct, to ensure that customers of the financial sector are treated fairly, and that charges are reduced and made more transparent.

“I also hope propose to table the Insurance Bill before the end of the year.”

TAX-FREE SAVINGS

The Minister of Finance said progress had been made in promoting saving by households, “through the introduction this year of tax-free savings products.

He added that in collaboration with Minister Dlamini and Minister Oliphant, work on social security reform proposals “is at an advanced stage to accompany retirement reform.”

Nene said he needed to emphasise the importance of providing suitable vehicles for preservation of savings and conversion into income in retirement, alongside appropriate death and disability benefits.

“We are engaging with labour to ensure that members of provident funds enjoy the full benefit of tax deductions for savings plans that provide an assured income in retirement.

“I hope that these proposals will be prioritised for discussion in NEDLAC over the period ahead.”



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