FINANCE Minister Pravin Gordhan said he would commit new money to the Department of Health when he delivers his Medium Term Economic Framework next month.

"There is actually no doubt that the health system has suffered as a result of many decisions that seem to have been made," Gordhan said yesterday before submitting the latest Treasury review of provincial spending to the National Council of Provinces.

"But we have an energetic minister of Health who is very determined to ensure that we strengthen the health system, that we strengthen the hospital system, that we deliver ARVs on time and more importantly lay the platform for national health insurance to come in over a period of time," he said.

Gordhan gave no details of the controversial plan to introduce a compulsory national health insurance scheme as early as March next year.

According to the still vague details released by the ANC, everyone will pay in to a central insurance scheme and anyone will be entitled to seek treatment in any hospital, public or private.

The provincial budget review, which is published every second year, analyses spending in all nine provinces and highlights developing and inherited challenges.

The report said that despite allocations to health increasing at an average of 4,8percent per person per year since 2005, the system remained "hamstrung" by challenges including:

l The large burden of HIV and TB "not being adequately prevented";

l Slower than expected progress in bringing down child and maternal deaths; and

l "weakness in governance and accountability procedures".

Total spending on health by national and provincial governments has increased from R48billion in 2005 to R83,8billion this year.

The current three-year outlook, which does not take account of Gordhan's promised enhancement, is scheduled to rise to R101billion by 2011. The budget for HIV prevention and the treatment or people with Aids is set to grow from R1,7billion in 2005 to R5,9billion in 2011.

Gordhan signalled, however, that Health Minister Aaron Motsoaledi planned a radical shakeup of the healthcare system.

"If health is a priority, as it is, then we must make sure that we can provide the resources that are necessary."

The Treasury's health policy chief Mark Bletcher confirmed that the Health Department would get additional money next month.

If the additional funds were used well, provinces should be able to avoid having to cut services in response to the recession, which is set to slash tax revenue by R60billion in the current financial year.

The Treasury official responsible for provincial finances Kenneth Brown said the health sector would be one focus of a countrywide programme to cut unnecessary expenditure. He said that savings would not be surrendered to the fiscus, but would be redirected to bolster services under stress.