JOHANNESBURG - THE SOUTH African business sector has thrown its weight behind the government's multibillion-rand programme to fund the acquisition of life-saving Covid-19 vaccines.
Business for South Africa (B4SA) said yesterday that they believed the programme would cost around R12 billion, assuming an average uptake of 70 percent among the adult population. However, the Department of Health has estimated that the country's Covid-19 vaccine programme could cost up to R20bn.
The government has communicated that the funding for the vaccination programme will be a combination of National Treasury budget allocations and medical scheme contributions.
But B4SA steering committee chairperson Martin Kingston said they still needed clarification on funding flows and reimbursement models between the government, medical schemes and vaccination sites.
Kingston said B4SA was in agreement with the government that the cost of the vaccine was immaterial relative to the damage being caused to the economy if it could not operate at full capacity.
“There will be no end to the pandemic nor the beginning of an economic recovery without a comprehensive, effective and urgent national vaccination programme,” Kingston said.
“The cost of a vaccination programme is dwarfed by the human and economic cost of an unchecked Covid-19 pandemic.”
There has been market speculation that the National Treasury is considering tax hikes as one of the ways to finance the country's Covid-19 vaccine programme and this would be announced in the upcoming Budget this month.
Old Mutual Investment Group's chief economist Johann Els, however, said yesterday that the National Treasury could afford the roll-out of Covid-19 vaccinations twice over without raising taxes.
“Something that hasn't yet got the attention I think it deserves is that the latest figures from the National Treasury show that we're heading for a budget overrun,” Els said.
“Due to higher-than-anticipated tax revenue last year, there is a revenue surplus of between R45.8bn to R106bn.”
B4SA co-ordination of costing and funding workstream member Ronald Whelan said the financing of the vaccine would be a combination of both the private and public sector as central funding and procurement would be done through Treasury.
“Though these details are being finalised, it looks like this is how procurement will work,” Whelan said.
South Africa this week received its first consignment of 1 million Covishield doses of AstraZeneca from the Serum Institute of India.
The country has also secured 41 million doses of vaccines in total from the global Covax facility, Johnson & Johnson, and Pfizer, commencing with deliveries in the second quarter.
Covax facility yesterday published its first interim distribution forecast of the Pfizer/BioNTech vaccine and the AstraZeneca/Oxford vaccine in the first half 2021.
The forecast showed that South Africa would get 3.1 million vaccine doses under the Covax programme by the end of March, with 117 000 doses from Pfizer and the rest from AstraZeneca.
“Delivery is estimated to begin as of late February, subject to the World Health Organization's emergency use listing procedure, manufacturing supply capacity and completion of prerequisites, as outlined in the related caveats section,” Covax said.
BUSINESS REPORT