Parliament’s Joint Standing Committee on Defence has called on current South African National Defence Force (SANDF) members to reconsider their resistance to the increase in their contributions to ensure that the Regular Force Medical Continuation Fund (RFMCF) remains viable and sustainable.
The committee, in a statement on 17 November following a meeting that discussed issues with the RFMCF, said it is concerned that the sustained low contribution model will have dire consequences for members when they retire. The envisioned balance will ensure quality medical services upon retirement.
The Fund is an autonomous structure that was established around 1964 for retired Regular Force members to receive continued healthcare benefits. The Fund is a medical pension type fund, nod a registered medical scheme. Until 2016 it was comprised of SANDF members, trustees, retired and union representation, but a financial and management crisis had developed by 2016 and by January 2017 the board was dissolved by the Military Command Council. An interim board was appointed by the Minister of Defence.
The RFMCF has some 19 345 principal members, as well as 57 841 active SANDF members (who are only eligible to use it when they retire). It is managed by a Board of Trustees, with the SA Military Health Service the primary designated service provider.
The aim of the Fund is to provide for continued medical, dental and hospital treatment through the SAMHS to members of the Regular Force and their legally registered dependants who qualify to be admitted to the Fund.
The RFMCF is facing ‘financial depletion,’ the JSCD heard, through high expenditure, low contributions, and no contribution increases by the SANDF for the past five years. For the year ending March 2023, healthcare expenditure exceeded monthly contributions by R1.5 million, a deterioration from the past four years when surpluses were reported.
“While the committee acknowledges that the RFMCF is a private entity, it is important to ensure the viability of the fund because it ensures the wellbeing of members after retirement. The welfare of our members, active or retired, is important,” said Cyril Xaba, the co-Chairperson of the committee.
While the committee welcomed the fund’s improved financial management and governance, it emphasised that its funding model should be reconsidered in the light of the cost of healthcare, which is above inflation in most cases.
The committee also highlighted the consequences of weaknesses within the South African Military Health Service (SAMHS), which directly impacts on the fund’s viability and which has resulted in the increased use of the private sector. A functional SAMHS should be providing quality healthcare to all its members, both active and retired.
“We have been emphatic about the need to resolve challenges facing the SAMHS to ensure that it is enabled to provide adequate support to all members and also save the fiscus excessively high private medical costs,” said Mamagase Nchabeleng, the co-Chairperson of the committee.
