Provincial health department in ICU

Massive overspending by the Eastern Cape health department has forced the provincial treasury to oversee the hiring of its staff and introduce drastic cost-cutting.

With the department almost R700-million in the red for the 2010-2011 financial year, the treasury adopted a big brother approach to "arrest possible overdraft" of provincial revenue and avoid the embarrassment of the department being placed under national administration.

The Eastern Cape education department, and the health and education departments of Limpopo, are under national administration.

In a December 6 letter to the department's chief financial officer, provincial treasury superintendent-general Marion Mbina-Mthembu ordered the department to curb its spending: "Consequences of ignoring these measures can place the province in an untenable position and it is not the province's wish that the national government come and implement measures and that results in dire consequences."

Despite the control measures, the department overspent by R666-million, though Mbina-Mthembu said this could be less.

In the letter, Mbina-Mthembu details how the department should tighten its belt.

The department was instructed to cut its budget by R205-million between December and March.

These cuts include:

• Reducing fuel and maintenance costs;
• Stricter control of phone and cellphone use, printing and stationery;
• Halting the procurement of equipment, IT consumables, magazines and books;
• Reducing air travel, accommodation and car-hire costs;
• The use of consultants must now be approved by the provincial treasury.

"All appointments" must be stopped immediately .

The cost-cutting instructions come with a bold warning.

"In instances where this instruction is ignored by the district offices, disciplinary measures must be instituted by the accounting officer," Mbina-Mthembu said.

After the notice went out, the Junior Doctors' Association of SA expressed fear that its members might not get salaries this month.

Association chairman Tende Makofane claimed that at least 373 new doctors would not be paid because they could not be formally appointed by the department.

However, Eastern Cape health department spokesman Sizwe Kupelo said the appointment freeze would affect administrative and non-essential staff only.

"It would be criminal for us not to pay doctors. It is not going to affect doctors. No doctor will go without a salary at the end of the month," said Kupelo.

The department had captured and approved the employment of 100 doctors with treasury authorisation yesterday.

Kupelo said that, instead of the department capturing, approving and authorising new appointments, the treasury would now do so.

He said the department last year introduced cost-cutting measures, including all out-of-town trips being authorised by the superintendent-general, and officials staying in bed and breakfast establishments instead of hotels.