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“Eye Surgeon Decision Timely Warning"

1 July 2004

“Eye Surgeon Decision Timely Warning Against Contracting Out And Privatising Health Services

“The punitive awarding of financial penalties and costs against the eye surgeons in the Southland case provides an unfortunate but timely warning against contracting out and privatising health services,” said Mr Ian Powell, Executive Director of the Association of Salaried Medical Specialists, today.

“The eye surgeons’ case goes back to the days of the failed market experiment of the 1990s when public hospitals were required to behave as competing commercial businesses under the Commerce Act and were encouraged to privatise including contract out health services.”

“Under the Commerce Act if the effect of one’s actions is anti-competitive then it is unlawful regardless of the intent. This then leaves those involved vulnerable to highly punitive treatment. But this conflicts with the essence of the public health system which depends on cooperation, coordination and collaboration. Privatisation, including contracting out, brings the two cultures of competition and cooperation into a head-on clash.”

“New Zealand must never repeat the errors of the 1990s’ market experiment which led to such a clash of cultures,” concluded Mr Powell.


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