Wed, 03 Mar 2021

  • President Cyril Ramaphosa says government is looking at increasing public borrowing to pay for Covid-19 vaccines.
  • Ramaphosa, who is providing his political overview at the ANC's lekgotla, said this was a public good.
  • Finance Minister Tito Mboweni is expected to outline the 'challenges' with regards to this later.

President Cyril Ramaphosa said at the ANC's national executive committee lekgotla on Friday that government will look at increasing public borrowing to fund the procurement of Covid-19 vaccines.

He was delivered his political overview at the opening of the two-day meeting of ANC leaders, their alliance partners and other top government deploys.

'Public good'

"This is a public good that is vital to the well-being of all our people, and it is therefore correct that public funding should be used, even if this means increasing public borrowing. [Finance Minister] Cde Tito [Mboweni] will later outline challenges in this regard, but funds will be there to save the lives of our people," he said.

Ramaphosa said the cost of the purchase of the vaccines is a major challenge, adding that the first, and primary, source of vaccine funding is the fiscus.

"We are also engaged in discussions with the private sector for companies to make a further contribution, either into a pooled fund or where employers are able to cover the cost of vaccination for their workforce. Many of them have also shown a willingness not only to help with the vaccination initiative of their employees, but also people living in surrounding communities.

"Some of these companies are in the mining industry," he said in his written speech, prepared for delivery.

The president repeated that the vaccine programme is "without doubt the largest logistical exercise in our country's history".

Not only South Africans

He further warned, for the first time, that the vaccine programme needs to reach everyone within the borders of the country, whether they are South Africans or not.

"This is not only a matter of basic human rights, but it is also necessary if we are to achieve the necessary level of population immunity. So we need to be careful not to talk about vaccinating South Africans only, and the continent is looking to us whether we will focus on our country alone."

Tax hike?

Ramaphosa's statement comes as many economists and opposition party leaders have warned against a tax hike to fund vaccines. The ANC's ally Cosatu earlier told News24 that it would oppose any suggestion of an increase in taxes.

The jitter around possible taxation increases came after Treasury Director General Dondo Mogajane told the media that this was an option it was considering.

Mogajane said the Treasury will make sure the tax burden was not detrimental to the country's economy.

In his last national address, Ramaphosa said three channels would be used to acquire the vaccine including the World Health Organisations COVAX facility, direct engagements with vaccine manufacturers and through the African Union's initiative.

At least 20 million vaccines are expected in the first half of the year, he said.

Medical aid schemes will also play a role in government's funding model, the president told the lekgotla, adding that he anticipates that through these funding models government will cover the cost of the purchase, storage, distribution and administration of all the vaccines.

Source: News24

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