Mohloai Mpesi
THE Christian Health Association of Lesotho (CHAL) is drowning in a staggering M152 million debt, a situation that is now affecting the delivery of critical health services across its institutions throughout the country.
The money is mainly owed to the Revenue Services Lesotho (RSL) in unpaid Pay As You Earn (PAYE) as well as the National Drug Service Organisation (NDSO) for medicines.
The troubling revelation emerged during CHAL’s budget presentation to the National Assembly’s Social Cluster Portfolio Committee this week.
According to CHAL Deputy Executive Director, Libete Selapane, the association’s debt had ballooned to a worrying M152 million due to limited funding CHAL receives from the government.
Mr Selapane said the M384 million budget allocation to CHAL for the upcoming financial year was insufficient to address the association’s mounting financial challenges.
“The last time we reviewed CHAL’s debt it was around M70 million, but it has continued to increase. When we last worked on it, the debt had risen to M152 million,” Mr Selapane said.
“This includes debt owed to the NDSO and PAYE owed to RSL. By failing to remit PAYE, we are effectively breaching the law.”
He warned that the situation facing CHAL institutions was dire.
“We are in deep trouble. With the current allocation of M384 million for this financial year, our situation is not going to improve. Instead, it will continue to deteriorate,” he said.
CHAL is an association of hospitals owned by different churches across the country. The government covers 70 percent of the operational costs of CHAL health facilities, while 20 percent is from churches and 10 percent from patient fees.
CHAL provides about 40 percent of health services in the country through 71 health centres, eight hospitals and four nurse training colleges.
The association’s salary expenditure accounts for a substantial portion of its funding, representing no less than 70 percent of the government subsidy.
At least 13 out of 52 independent facilities were said to be operating at a financial deficit, with available resources sufficient only to cover salaries.
It was also reported that a majority of independent facilities (15 out of 19) were experiencing financial deficits largely due to the stagnant government subvention.
In November last year, CHAL hospital staff went on strike after going for two months without salaries. The delays were linked to the pending renewal of the Memorandum of Understanding (MoU) between the government and CHAL, which temporarily hindered the disbursement of funds. CHAL later indicated that the parties had extended the “old MoU” while awaiting the signing of a new agreement.
Mr Selapane said proposed changes to the MoU between the government, through the Ministry of Health, and CHAL required additional funding, which had not been availed.
Mr Selapane further stated that all eight CHAL hospitals were operating at a deficit.
“The hospitals receive 70 percent of their funding from the government subvention, 20 percent from proprietors and 10 percent from user fees. All eight hospitals are currently operating at a deficit due to the unchanged subvention,” he said.
“Expenditure is skewed, with about 80 percent of funds going towards salaries rather than other operational costs. Rising prices, combined with the stagnant subvention, continue to limit the procurement of commercial drugs.”
He said the proposed amendments to the MoU would be difficult to implement without an increase in funding.
“If there is no increase in the allocation, proprietors (churches) are frustrated about how the proposed changes will be implemented without the corresponding budget,” Mr Selapane said.
CHAL Executive Director, ’Makatleho Mohasi, said the financial deficit was severely affecting the quality of healthcare services.
“In CHAL facilities right now, the issue of medication has deteriorated significantly. Some institutions currently do not have medication at all,” she said.
“This financial deficit is directly affecting the quality of care we are able to provide to Basotho.”
She explained that several clinics known as independent facilities were particularly struggling.
“There are 52 independent facilities, and 13 of them are running financial deficits. Because of this, their budgets are prioritised for salaries, leaving them unable to purchase medication and cover other operational costs,” Ms Mohasi said.
“This is why when patients arrive at some CHAL hospitals, they are attended to but sent back without medication.”
Members of the committee also raised concerns about the outdated MoU between the government and CHAL.
The Social Cluster Portfolio Committee chairperson, who also serves as Chair of Chairs, Makhalanyane Mokhothu, directed the Ministry of Health and CHAL to review the existing MoU, which was last signed in 2007, to address the challenges facing the health sector.
“We asked the Ministry of Health and CHAL to prepare themselves. We will not pass another budget without a reviewed memorandum of understanding following the process already initiated,” he said.
“We are aware that the formulas in the agreement should have been reviewed long ago. For the longest time, the clauses of that agreement have not been followed, and both parties have violated them.”
Mr Makhalanyane acknowledged that the government also owed CHAL money.
“We are aware that the ministry did not pay CHAL on time at some point, forcing the organisation to borrow money elsewhere, which worsened its financial position,” he said.
“The last time I saw the debt owed to CHAL by the ministry it was around M70 million in arrears.”
However, he also said CHAL had not fulfilled some of its reporting obligations.
“There were reports that CHAL was required to submit, including clarifying audit queries, but these were not completed. Audits of several health centres continue to highlight long-standing problems,” he said.
Mr Makhalanyane emphasised that CHAL played a vital role in the country’s healthcare system.
“CHAL provides about 40 percent of health services in Lesotho. During our visits to health facilities across the country we found disturbing situations,” he said.
“During a visit to Beresi in November, about 54 patients were sent home because there was no medication for diabetes and high blood pressure. At Paray Hospital we observed similar situations where patients were turned away.”
CHAL board chairperson, Relebohile Mabote, criticised what she described as a lack of transparency from the Ministry of Health, saying the government treated CHAL as a junior partner rather than an equal stakeholder.
“The review of the MoU is being conducted in a worrying manner. As partners we should sit together to identify problems, their causes and possible solutions,” she said.
“We believe that true partnership requires transparency. Instead, the process is rushed. We relax for a long time and then suddenly begin in February when the budget has already been allocated.”
Ms Mabote said the current approach undermined the spirit of partnership between CHAL and the government.
“We want the government to appreciate that this is a partnership. We should not be treated as mere recipients of grants,” she said.
She warned that the reduced budget allocation would inevitably lead to compromised services.
“Due to financial constraints, the government cuts our budget, which means certain services will have to be reduced. This often leads to protests by CHAL workers when salaries are delayed because funds have not been released on time,” she said.
She added that many CHAL facilities lacked medications because funds were prioritised for salaries.
“Patients will always be attended to, but they are sometimes sent home without medication because we simply do not have the money to purchase drugs,” Ms Mabote said.
“Our hospitals owe RSL because when the reduced budget arrives, facilities prioritise paying salaries instead of remitting PAYE in order to keep services running.”
She said CHAL had received a draft of the revised MoU from the government and will review it before submitting recommendations.
“The first MoU was signed in 2007 and we have been operating under it ever since. Both CHAL and the government have challenges that have made it difficult to comply fully with the agreement.
“Parliament has advised that the MoU be reviewed. We have received a draft from the government which we will analyse and recommend changes so that we can arrive at an agreement that satisfies both parties.”
