Parliament’s Portfolio Committee on Health will ask the Minister of Health, Dr Aaron Motsoaledi, and officials from his department to brief MPs on the implications of the Constitutional Court’s judgment that struck down the certificate-of-need (CON) provisions in the National Health Act.
The CON would have required healthcare establishments and agencies, as well as providers of prescribed health services, to obtain state approval to establish, expand, modify, or continue certain healthcare operations and services.
In a statement following the judgment on 18 May, the Portfolio Committee said it respects the authority of the Constitutional Court, while signalling that legislative intervention to transform the healthcare sector will continue.
Faith Muthambi, the chairperson of the committee, said the judgment provides important legal guidance on the constitutional limits of legislative intervention, particularly where measures adopted by the state have implications for fundamental rights and freedoms.
Muthambi said the judgment “should be viewed within the broader context of South Africa’s ongoing efforts to address long‑standing structural inequalities within the healthcare system. Access to quality healthcare remains uneven across geographic and socio‑economic lines, and the state retains a clear constitutional obligation to progressively realise this right for all. In this regard, the need for meaningful and sustainable transformative interventions within the health sector remains urgent and undisputed.”
The committee will invite the Minister of Health and officials from the department to brief it on the implications and consequences of the ruling, including its impact on existing policy frameworks, future legislative interventions, and broader health system reforms.
No rational connection between the scheme and its purpose
In a unanimous judgment, the Constitutional Court confirmed a July 2024 ruling by the High Court in Pretoria declaring sections 36 to 40 of the National Health Act unconstitutional and invalid. The High Court held that the provisions are irrational and unjustifiably limit the constitutional right to choose a trade, occupation, or profession freely.
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The application was brought by trade union Solidarity, the Alliance of South African Independent Practitioners Association, the South African Private Practitioners Forum, several individual practitioners, and the Hospital Association of South Africa. The Minister of Health and the Director-General of the Department of Health opposed the application.
The ruling removes the CON regime from the Act. The Act came into operation in May 2005, but the impugned provisions took effect later.
The Department of Health argued that the system was necessary to address South Africa’s unequal distribution of healthcare resources. It submitted that the regime would assist in directing healthcare investment and services into underserved areas, address the concentration of facilities in urban centres, and support broader healthcare reform.
The Constitutional Court accepted that these objectives are legitimate and acknowledged the inequalities that continue to characterise the healthcare system. It nevertheless found that the legislative scheme failed constitutional scrutiny because the state had not demonstrated a rational connection between the scheme’s objectives and the mechanism chosen to achieve them.
The Court also rejected the argument that the challenge was premature because the provisions had not yet been brought into operation. It held that legislation may be assessed for constitutional validity on its face, even where it has not been implemented.
The Court recalled earlier litigation concerning the CON provisions in President of the Republic of South Africa and Others v South African Dental Association and Another. The provisions proclaimed to be operative from 1 April 2014. In 2015, the Constitutional Court set aside the “erroneous proclamation” because the Minister of Health had not issued regulations regarding applications for, and the granting of, the certificates. If the proclamation had remained in force, healthcare providers could have been exposed to criminal liability for operating without a certificate that it was not possible to obtain.
Against this background, the Court identified several structural difficulties with the scheme.
Concerns about the scheme’s scope
A key difficulty was that the scope of the scheme is not defined in the statute itself. The provisions require a CON for “prescribed” health services and technology but leave it to future regulations to determine what those services and technologies are.
The respondents argued this means not all health services or providers would fall within the scheme. The Court found this unpersuasive. It held that, in the absence of regulations, it is not possible to determine from the statute which services are subject to the requirement, or how the scheme would operate in practice.
The Court further held that leaving the determination of the scheme’s scope to the Minister of Health is inconsistent with the principle that regulations may not be used to interpret legislation. On that basis, it found that the power conferred on the Minister amounts to an impermissible delegation of legislative authority and permits the scope of the scheme to be defined in a manner that is unconstrained and potentially overly broad.
Against this background, the Court held that the provisions do not establish a “comprehensible, choate scheme” against which it is possible to assess whether there is a rational connection between the scheme’s purpose – including the equitable distribution of health services – and the means adopted to achieve it. In the absence of such a scheme being defined in the legislation itself, it found, health service providers would not be able to determine how to comply with the law.
A further difficulty identified by the Court was that the statutory criteria governing certificate applications do not require the Director-General to consider the rights and interests of health establishments, agencies, or providers. Although the scheme includes factors relating to geographic distribution, demographics, and inequality, the absence of an express requirement to consider affected parties’ rights was held to render the process irrational.
The Court also found that no objective evidence had been presented to demonstrate that the scheme would achieve its stated purposes, including improving the geographic distribution of health services or enforcing standards. It noted further that no explanation was provided as to why existing regulatory mechanisms are insufficient to achieve these aims.
The Court found that the scheme confers wide powers on the Director-General, including the ability to grant or refuse certificates and to impose conditions, but held that these powers are not accompanied by sufficient statutory safeguards to guide their exercise.
The judgment records that if pursued without appropriate safeguards and consideration of its impact, the scheme carries the potential to cause “lasting damage to the provision of all health services across South Africa”.
Limits a constitutional right
Having found the provisions irrational, the Court also considered their impact on the right to choose a trade, occupation, or profession.
It did not accept the submission that the CON regime constitutes a form of ordinary professional regulation. It found that the requirement to obtain a CON as a precondition for operating affects decisions about location, services, and the continued viability of healthcare practices.
Because the scheme determines whether providers may enter or remain in practice, the Court held that it limits the right in section 22 of the Constitution. It concluded that this limitation is not justified under section 36.
The Court did not suspend the declaration of invalidity. It noted that the defects identified go to the core design of the scheme. The provisions have therefore been severed from the Act.
The ruling means that any future attempt to introduce a comparable system would need to address the constitutional deficiencies identified by the Court.
‘Central pillar’ of NHI
Solidarity welcomed the judgment. In a statement, the organisation said the ruling has implications for the regulatory approach associated with National Health Insurance (NHI).
“One of the NHI’s central pillars has collapsed today. The certificate of need was far more than merely an administrative instrument. It was an instrument of centralisation and state control,” said Anton van der Bijl, Solidarity’s deputy chief executive.
But the Department of Health, in its response, disputed that the judgment related to the NHI Act.
“The sections in question were passed by Parliament 23 years ago and have never been brought into effect. Thus, there is no direct impact of the judgment on the NHI, as some within the political and private health sector have rushed to mislead the public on. No section of the NHI has been declared unconstitutional,” the department said, adding it is continuing with preparations for NHI as the mechanism for South Africa to realise universal healthcare.
Although the department’s statement contends that the judgment has nothing to do with NHI, the Constitutional Court records at paragraph 31: “The respondents state that the scheme created by the impugned provisions is a central pillar in the implementation of the National Health Insurance Act.”
Click here to download the judgment.
