Estimates Debate — Health Sector

Members, we come now to the vote in the health sector, B.5, volume 6. The question is that Vote Health stand part of the schedules.

Tēnā koe, Mr Chair. It is my pleasure to lead the Estimates debate for Vote Health as the chair of the Health Committee. I have a few things I want to emphasise, and I will start with the Budget appropriation, which sits at $18.225 billion and represents a 10.2 percent increase in the estimated actual expenditure in the 2017-18 years. This was because of three main components: $549 million in non-departmental output expense for policy initiatives for district health boards (DHBs); a $750 million investment in policy initiatives through capital investments, and I’ll talk a bit more about that later; and it also represents $100 million for additional deficit support for district health boards.

The Minister was very clear when he presented to the Health Committee about his focus areas, and I do want to emphasise these. They are equity of outcomes in the areas of primary care, prevention, and mental health, and he was also very focused on providing public health services. He emphasised during his session with us the challenges, and those challenges have been about hospitals and facilities not being fit for purpose. What did that actually look like? Well, it was discovered that buildings that service our families, children, and communities in South Auckland were full of rot and dangerous mould that could make people sick. And why was this? I want to quote directly from our select committee report: “The Minister maintains that challenges in the sector can be attributed to the constrained funding environment in previous years.” So within this context the Minister was reviewing the health and disability services to consider whether the current system, facilities, and approaches are fit for purpose.

I particularly want to highlight an area—I’ll call it “of contention”—that the committee had to deal with, and it was actually in the review of the National Oracle Solution procurement system. There were some issues about what the system was doing, but, just for context, it is actually used by DHBs to manage how goods and services are sourced, ordered, delivered, stored, used, and paid for, and it’s jointly managed by NZ Health Partnerships and all 20 DHBs. The review will—and this is listed in our report—assess how the process has run, it will confirm any issues, and it will also look at whether to approve additional investment by DHBs and the long-term viability of the project. It’s fair to say that this was an incredibly robust part of the Estimates process. Some of the issues that were discussed during that particular engagement with the Minister were around conflict of interest, it was around what the review sought, and it was whether the review would ascertain if the National Oracle Solution procurement system was fit for purpose.

The other area I’d like to emphasise was the Minister’s particular focus on mental health and addiction services, and I want to put on the table that there was acknowledgment of the work that our colleague Matt Doocey is undertaking in this area, and we know that he is incredibly interested in working with the Government and, hopefully, on the inquiry into mental health and addiction that is due back in October 2018. Other work that is being conducted, in addition to this inquiry, focuses on the Mana Ake programme in Canterbury, nurses in schools, and also integrated therapies for 18- to 25-year-olds. So it is fair to say that the issue of mental health and addiction services and the challenges that we face as a country were another area that was hugely discussed, debated, and focused on, and I think it’s fair to say that the reason that they are is because we seem to have a whole range of unmet needs. We have major challenges in this area, so, obviously, as a committee we look forward to the report that we will receive in October.

Thank you, Mr Chair. It was very interesting for the Health Committee to confirm that Vote Health 2018 had the widest gap between the reality and the rhetoric, and we’ve heard plenty of rhetoric over the last few months about how there was this $8 billion funding shortfall thanks to the previous Government. If that was the case, then one would have expected at least some attempt to close the gap between where Labour said funding should have been and where funding was, and the most deeply disappointing factor of Budget 2018 is that not only did that not occur but we went backwards.

I’ve heard the Minister of Health say that this is the highest investment in health in 10 years. Well, actually, it’s the highest investment in health in history, because health always goes up. But the Minister, again, was trying to spin a line that, somehow, for 10 years there had been neglect, and here he comes in, a white knight, to save things. And, oh, were that the case, but, actually, what the committee heard was that nothing could be further from the truth. Instead of the $3.9 billion appropriation that we had in Budget 2017, this year we got a gross increase of $3.2 billion. But that was before the dividend was taken out by the savings that they claim they were going to make in Pharmac, in which case the net investment in health was only $3 billion—and we’ll get to that.

I’m sure Mr Doocey will get to the issue of mental health and the missing $100 million, but the best example of the rhetoric and the reality is in the district health board funding that Louisa Wall just mentioned as being $549 million. She described it as new policies. Actually, that’s the money that’s needed just to keep the lights on. When the previous National Government, in Budget 2017, appropriated $439 million for that purpose, the Minister, in his Opposition role, said that it wasn’t nearly enough. The minimum required to keep the lights on in 2017 was, in his view, $650 million.

So, 12 months later, with inflation, with fantastic books, and with a legacy of a strong economy, the opportunity was there for Dr Clark to appropriate $650 million plus interest, plus inflation—whatever was required to keep the lights on. What was it? It was $549 million. By the Minister’s own measure, he failed to reach that by at least $111 million and inflation.

And that wasn’t the worst of it. To me, the worst and most disappointing aspect of Budget 2018 was on GP visits. The Government crows that somewhere in the region of 600,000 New Zealanders are going to pay less for their GP visits, except it wasn’t 600,000 that they campaigned on. It was 4.5 million—that every single New Zealander over the age of 13 was going to get a reduction in GP visits. It was unequivocal. The Minister and the Prime Minister went, in Opposition, in August last year, to Māngere, to an adoring crowd, and said, “We’re all going to get a discount.” Only, the reality bit—he wasn’t able to deliver. And he wasn’t able to deliver the $20 million in medicines for the rare disorders fund that he told—

💬 Matt Doocey: That’s right—the cochlear implants.

—the New Zealand Organisation for Rare Disorders he was going to set up for them. Another broken promise. And I hear over my shoulder, because I can hear—just—but there are many New Zealanders who can’t, that cochlear implant funding is affected. Last year, the previous Government said, “Yep, we need to increase cochlear implant surgeries and we’re going to do it by 150 percent.” But do you know what that was going to cost? It was $6.5 million—1/2,800th of the vote—and this miserly Minister takes it away and does not appropriate it. He does not appropriate it.

And I think that is a crying shame, from a heartless Minister who talked about being compassionate, who talked down the great efforts that the previous Government made to improve the health of New Zealanders, and then pulled cochlear implant funding. Shame on this Government.

Thank you, Mr Chairperson. It’s a pleasure to take a call, in the Estimates debate, on Vote Health. And I actually want to change tack a little bit and talk a little bit about health targets, and actually think about the smoke and mirrors of the previous Government and what this Budget is going to do to actually address the underlying things that have been happening in the health system. I think, for me, listening to some of that scaremongering that’s been happening over the last month, about how the health sector is going to implode if the ministry stops reporting the previous Government’s targets—but I think the problem with targets is that they can be used very well to focus the health sector’s attention on important issues.

I apologise to the member for interrupting but it has come time for me to report progress.

Debate interrupted.

House resumed.

Progress reported.

Report adopted.

Sitting suspended from 9.56 p.m. to 9 a.m. (Wednesday)