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Rising Deficit Latest Health Epidemic

25 May 2001

Revelations today that public hospitals will only get an increase of $900,000 in funding to be shared by the country's 21 District Health Boards is horrifying, National's Health spokesman Roger Sowry said today.

The real Budget figures for health emerged today showing that of the $330 million extra funding to Vote Health less than $1 million is tagged for increases in hospital spending. The figures were released to boards in a confidential briefing yesterday.

"They confirm our worst fears that hospitals would be forced to cut services, and several board chief executives are warning today that serious cutbacks are likely.

"The Government is responsible for this funding nightmare which is forcing the DHBs to decide what services they will have to cut. The buck stops with Annette King and Michael Cullen who created this situation.

"The public have a right to know how these cuts will affect their communities. Annette King has got to front up and explain why she's mismanaging the funding of health so badly, and release publicly the confidential figures given to boards yesterday.

The growing health operating deficit released today also adds to the DHBs' woes. Public Health Statistics show the boards' Operating Result dropped from a $5.2 million surplus in the March 2000 quarter to a $33.8 million deficit in March 2001.

"National allowed deficits to accumulate in the 1990s but learnt the lesson that in the end they couldn't continue so we got rid of them. We left the operating deficit at under $6 million in 1999 after dropping it from $35 million the year before. "This Government is claiming it is being responsible by keeping the health budget tight but it has its priorities all wrong and is reneging on its promises.

"The Budget only gave 2.1 percent increase to health, the meanest in nine years. Today Annette King is out of her depth again, claiming health boards got an extra 2.6 percent on their basic funding compared to a 2.1 percent increase in inflation. The inflation rate is 3.1 percent so the health funding is way below the rate of inflation," Mr Sowry said.

Ends


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