NHI vagueness seen as a threat

Stellenbosch-based investment group Remgro has flagged uncertainty about implementation of National Health Insurance (NHI) among the factors that pose risk to its investments.

Stellenbosch-based investment firm Remgro has flagged uncertainty about the implementation of National Health Insurance (NHI) among the factors that pose risk to its investments.

The company, controlled by Johann Rupert, is the latest to voice concerns about the NHI bill, which was tabled in parliament in August, and paves the way for the establishment of a central fund for buying services on behalf of SA’s population.

Remgro owns a stake in private hospital group Mediclinic.

Speaking after the release of the company’s full-year results on Thursday, Remgro CEO Jannie Durand criticised the level of co-operation between government and the private sector in the development of NHI.

“The private sector has shown that it can run [health] facilities much better and cheaply. There must be more engagement. We all agree that there is a need to improve the country’s health care,” he said.

The private sector does not fully understand NHI: “It is so vague,” he said.

In the year ended June 30, Remgro’s headline earnings per share decreased by 4.2% from 1,512.6c to 1,448.9c. The company has attributed this mainly to lower earnings from RCL Foods, Community Investment Ventures Holdings, and Total SA.

Durand said fragile economic growth, low business confidence and the influx of chicken and sugar imports had an effect.

“Weak domestic fundamentals remain the key feature of the SA operating environment. Uncertainty remains high with SA’s fragile signs of real GDP growth, a lack of policy reform momentum and fiscal strain against a backdrop of global growth concerns,” he said.

Remgro declared a final dividend of 349c per share, taking the total dividend to 564c per share, up 6% compared to 2018.

RCL Foods’ contribution fell 60.7% to R254m. Durand attributed this to oversupply in the local poultry and sugar industries, driven mainly by cheaper imports and declining demand.