Hospitals Operating Deficit Increases
Public Health Financial Statistics: December 2000 quarter
The annual operating deficit of Hospital and Health Service (HHS) providers rose to $20.6 million for the December 2000 year Statistics New Zealand reported today. This is up from the $4.5 million operating deficit recorded for the December 1999 year. The main contributors to the rise were increased salaries and wages and rising supply costs. The December 2000 quarterly result was an operating deficit of $11.0 million. This compares to the $1.4 million surplus reported for the December 1999 quarter.
Operating income for the December 2000 year was $3,645.8 million, up $204.8 million or 6.0 per cent from the December 1999 year. Over the same period the cost of providing services increased by $221.0 million, or 6.4 per cent, to reach $3,666.4 million at December 2000.
In the latest year revenue from Government was $3,335.0 million, compared to $3,187.4 million in the December 1999 year. The proportion of income from this source was 91.5 per cent of total revenue, compared to 92.6 per cent a year earlier. Increased funding to address policy priorities contributed to the rise in government revenue.
Taxpayers' equity fell to $919.2 million, reflecting the increased deficit. This was $12.3 million lower than at the end of December 1999. Debt increased at a faster rate in the December 2000 year than in the previous year, rising by $338.9 million to reach $1,657.1 million at the end of December 2000. This produced a higher debt equity ratio than a year ago. The ratio moved from 1.42 in the December 1999 quarter to 1.80 in the December 2000 quarter. The increase in debt is due to increased capital expansion with new hospitals being built, older hospitals being refurbished and equipment being purchased. Additions to fixed assets over this period were $373.9 million.
At the end of December 2000 total assets for HHS providers were valued at $2,576.3 million, an increase of $326.6 million or 14.5 per cent on the value at the end of December 1999.
The book value of fixed assets increased over the year to reach $1,940.2 million. During the year, HHS providers acquired $373.9 million of fixed assets and sold $20.8 million. Purchases of fixed assets in the year to December 1999 were $265.8 million. The debt to fixed asset ratio of 0.85 recorded at the end of December 2000 was up on the 0.74 recorded a year earlier, reflecting the increased capital expenditure over the period.
Ian Ewing DEPUTY GOVERNMENT STATISTICIAN