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Southerners won’t back down

Nurses at Dunstan hospital celebrate International Nurses Day

Nurses at Dunstan hospital celebrate International Nurses Day

Southerners are gutted to hear of a five percent funding cut to their network of rural community hospitals in Oamaru, Ranfurly, Dunstan, Balclutha and Gore.

And if that’s not bad enough, there will be reviews of health services and no increases for changing costs or population. What that means is that if the population of your town increases, there won’t be any corresponding increase to health funding.

Hospitals are still working out what impact this will have on services and each hospital will be affected differently. What we do know is health services are under threat and so are many jobs.

At the same time, Southern District Health Board (SDHB) has announced plans to contract out and privatise its food service, with frozen meals being driven down from Auckland, in a further attempt to save money that threatens local jobs. We can see no sense in that whatsoever!

So why is all this happening? Southern DHB’s financial situation is pretty grim – they are $27 million in the red this financial year and are predicted to be at a $42 million financial deficit next year. When DHBs are squeezed this tight, something has to give. This time it’s the health of our rural communities, not to mention their nutritional needs!

While we don’t know all the reasons for their financial woes, or why they are so much worse off than other DHBs, we do know that a contributing factor is the year in, year out, underfunding of health services in New Zealand [pdf].

It’s this Government’s seventh budget this week, and they’ll be announcing funding for health for the next year. If they get it wrong, we’re looking at losing local jobs and local health services. Without more money coming in, it’s hard to see how Southern DHB will be able to preserve all the health services the population needs.

It’s not fair that valued local services, through no fault of their own, have to bear the brunt of Southern DHB’s deficit. NZNO will be working constructively with the affected rural hospitals to save services and protect member’s jobs. Not only will these cuts put patients’ health at risk, but removing skilled jobs from the regional economy impacts on the region’s long term financial health.

This ends up costing the Government more in the long run through health, social services, and other agencies. Southerners understand this, and we will be backing them all the way to find healthy and sustainable solutions to the District Health Board’s financial crisis.

Watch this space for NZNO’s response, and updates on the Southland and Otago rural hospital network plan for dealing with the cuts.



The underfunding of DHBs

Bill Rosenberg is the Policy Director/Economist at the New Zealand Council of Trade Unions Te Kauae Kaimahi. He is widely published on globalisation, trade and e-learning. You can read Bill’s monthly economic bulletins here

For the past five years, the Council of Trade Unions has analysed how much was approved for Health spending in each year’s Budget. The theme is “Has Health been given enough to stand still?” We look at the costs, the population pressures including the ageing of the population, and the promises for new services, and compare them to what is actually provided. You can see the reports which give details and show the assumptions we used here.

Treasury estimates of real changes in health spending after costs and population expenses

In the 2014 Budget we estimated that the Health Vote was $232 million behind what is needed to cover announced new services, increasing costs, population growth and the effects of an ageing population.

The Health Vote increased by $307.9 million in operational funding overall between Budget 2013 and Budget 2014 (from $14,134.6 million to $14,442.5 million). This is $185.6 million short of the $493.5 million we estimated was required just to keep up with costs without providing for new and improved health services. However the Budget in addition introduced “new policy initiatives” costing $120.1 million in 2014/15 (putting aside the bulk of the “initiatives” which were actually funding towards increasing costs and population pressures), bringing the total needed to $613.5 million. This was offset by “savings” totalling $73.6 million including $56.7 million that are not explained, plus a reduction in the provision for risks such as epidemics or natural disasters of $17.0 million. If we take the savings at face value, the total shortfall is therefore $232.0 million.

District Health Boards (DHBs) were underfunded by an estimated $94 million just to cover increased costs and demographic changes. When the costs of new services which the DHBs are expected to provide are taken into account, the shortfall is likely to be well over $100 million.

Centrally managed national services such as National Disability Support Services, National Elective Services, National Emergency Services, National Mental Health Services, Primary Health Care and Public Health services received $134 million below needs.

We don’t look at capital funding in any detail, but it rose sharply: from $520 million in Budget 2013 to $1,114 million in Budget 2014. This follows a significant increase in capital expenditure last year. In the 2012 Budget, $289 million was budgeted for capital. The Ministry of Health had observed in its Four Year Plan that “Capital investment is needed nationally because a significant proportion of hospital buildings are in poor condition[1]. While the increase in capital funding is much needed, increased capital assets create additional costs for DHBs because they have to pay the government capital charges and must provide for depreciation. As Treasury noted in 2013 Budget papers, “new capital builds are more likely to result in large deficits for DHBs”[2].

We also had a look at the cost of the welcome policy initiative to enable children under 13 to have free access to GPs and free prescriptions from 1 July 2015. Our estimate was that it could cost closer to $40 million per year rather than the $30 million in the Budget estimates.

How good are our estimates, and what about the forecast funding for the four years to June 2018 which are part of the Budget? In past years, Ministry of Health estimates of the funding shortfall were released, but they were largely redacted from documents released following the 2013 Budget.

However, for the year to June 2015 (financial year 2014/15) Treasury is forecasting health to have a real growth of negative 2.3 percent according to its spreadsheet issued with the Budget. On their figures we calculate that represents a shortfall of $360 million. So our estimate is conservative.

Greater cuts are forecast for the following three years. In the event, Health could get some more from the ‘operating allowance’ for new spending in those years but not enough is being allocated for this to cover the shortfalls in all the areas of the forecast Budgets, most of which will be in a similar position to health. (See the May CTU Economic Bulletin for more detail.)

Treasury estimates of real falls in Health funding after costs and population growth(Fiscal Strategy Model, 2014 Budget)
Year to June 2014 2015 2016 2017 2018
Percent -0.6% -2.3% -3.7% -3.6% -3.1%
$million -$82m -$360m -$587m -$559m -$488m

Treasury warned in the preparation of the 2013 Budget that such cuts would require major changes to our health services. This could include “more targeted services and funding” which implies dropping services, making some available only to certain groups, or introducing user charges[3].


[1] Vote Health 4 Year Plan for 2013/14 to 2016/17, December 2012, p.14, available at

[2] Treasury Aide Memoire to Ministers of Finance and State Services, 6 December 2012, p. 6, available at

[3] “Four Year Plan – Assessment and recommendation on final four-year plans submitted by Ministers to MoF and MoSS”, p.4-5, available at


Sometimes it’s the little things that matter

dinoScrubsWe all know there is cost cutting going on everywhere in the health system at the moment. DHBs are being forced to cuts tens of millions of dollars from their budgets and cost cutting measures (called “savings”) are being implemented in every ward and unit.

We hear every week about community health initiatives whose contracts with the DHB have been slashed. Clinics for refugee and migrant and other high needs populations are disappearing, aged care contracts are being squeezed and every hospital in the country is facing cut after cut after cut.

We know how stretched the nursing team is. Not being able to take annual leave, being called back from annual due to short staffing, vacancies not being filled, care being rationed – we hear sad stories every day.

I think it’s hard for people to get their heads around what’s actually happening in our health system. It’s hard to believe because when they or a loved one are in hospital the care they receive from the nursing team is so professional and they feel well cared for.

Today I heard that one hospital is stopping paediatric nurses from wearing bright, cartoon character scrubs. It’s a cost cutting measure. From now on all staff will wear the same plain blue scrubs.

That might not seem like a big deal; might seem sensible, even. But it’s not. It’s the little things that matter.

Being in hospital is one of the scariest things a sick child can face, and it must be pretty traumatic for family and whānau as well. Part of good nursing practice is to make the experience as comfortable as possible under the circumstances, and wearing bright, cartoon character scrubs is one way a nurse can help an ill child feel safe.

Putting paediatric nurses into plain scrubs might save the DHB a few dollars but the affect it will have on patients and families is more important than saving a few pennies. The philosophy of patient-centred care that turned paediatric wards into bright, sunny and interesting places with brightly dressed nursing staff, designed to put children and families at ease, is being turned on its head. It won’t be long now till children’s wards will be back like they were in the bad old days – dismal institutionalised places, not kid friendly at all.

That’s not what I want for our health system.


The image is from


Nelson ED nurses get together to create change

successNZNO members at Nelson Hospital have had their voices heard. They have successfully advocated for quality patient care and a safe environment for staff.

ED staff have been concerned for some time that their work is being compromised by a lack of staff, and all the flow on effects of that situation.

Reportable events about staffing levels had been logged but no action taken. NZNO College of Emergency Nurses guidelines for nurse/ patient ratios were not being met and nursing staff were concerned about the potential for breaches of the Health and Disability Commission code of patient rights.

The ED was experiencing an increased number of high acuity patients and Government targets were not being met. Staff vacancies were not being filled in a timely way and staff were worried that more vacancies were coming up. Annual leave requests were being turned down and staff were becoming more and more stressed and fatigued. They were overworked and overwhelmed.

It’s pretty hard on morale if you work in an emergency department and you don’t have the resources to deal with an emergency!

It’s often difficult to see the wood for the trees when you’re feeling like that, so it is a testament to the courage and wisdom of NZNO members that they made a decision to do something about it, and then followed through.

A meeting with the Director of Nursing and Midwifery and the Nelson Associate Director of Nursing was called and members told their stories one by one. It was a powerful and moving meeting. Staff were honest, passionate and resolute that the situation needed to change. That was 2 weeks ago.

Within 2 days the numbers had been crunched and ED staff were notified that an extra 2.14FTE had been approved and were being advertised. In the interim, casual staff are being used to ease the workload.

It’s a great outcome, and one that only happened because NZNO members worked collectively to address their concerns. When we stand together we are heard.

Ehara taku toa i te toa takitahi. Engari, he toa takitini.

Success is not the work of one, but the work of many.



Auckland DHB’s leaked email

Our guest blogger this week is a registered nurse working in Auckland. Her concerns about the politics of health spurred her to start a blog: and we’re pleased that she’s allowed us to cross-post her inaugural post.

The Auckland DHB’s leaked email, which reveals the management team’s readiness to further ramp up the pressure on staff and services in order to balance the books, will come as no surprise to clinicians who have become accustomed to working within an under-resourced system.

The DHB appears  willing to enforce the National-led government’s agenda, that of demanding more for less from the entire public service.  The government describes this as “cutting the fat”, but those who work in health  are acutely aware that this phrase, with its unpleasant connotations of butchery, is an ugly euphemism for renouncing its responsibility to ensure all NZers have equitable access to healthcare.

The day-to-day reality for clinicians is one of attempting to provide care in an environment which increasingly compromises their ability to do so safely and effectively.  CEO Ailsa Claire’s statement that “staff costs must be reduced” implies a lack of awareness of the depths to which staff morale has sunk.

Ms Claire describes “the danger of the Board or and (sic) external people determining how we resolve this issue.  Not good for the organisation”.  If Ms Claire’s fears were realised, it might well be damning for the Auckland DHB’s current management.  However,  it could be very positive for clinicians and their clients/consumers/patients if the intolerable stresses within the service became publicised as a consequence, and led to the necessary resources being provided.

The services provided by a district health board do not constitute a business, and the failure of those services to function within an inadequate budget cannot be defined as a financial “loss”.

Healthcare for all is a public good which must be properly funded by government, and effectively and compassionately administered and provided by health boards and their  employees..  When the means for the latter to do their work is absent, the solution is not to order them to “cut costs” and “control overspending”, it is to pass the responsibility back to those with the power to do something about it, namely, the government.


Progress at Dunedin hospital

ImageWe often say that NZNO is its members. Staff at Dunedin hospital are showing the truth of that statement. Unless members are working together to solve a problem, all the NZNO staff resource in the world won’t be able to fix it. Our power to affect change comes from the leverage we gain when individual members come together and work collectively.

Progress is being made at Dunedin hospital. NZNO delegates, with support from NZNO staff have been meeting with DHB representatives to work on solutions that are practical, real and will make a difference to NZNO members on the floor.

We have negotiated solutions that the DHB are putting in place, with 15 new registered nurses starting on NETP programmes on 28 March, ENs starting at the end of April and four casual HCAs to help with patient watches being recruited now.

A roster audit was completed this week and some changes will be seen in the rosters starting 24 March and we have been informed that 13 new staff have been recruited since January.

In the Emergency Department, benchmarking against other EDs around the country has been completed and ED staff are to be asked to complete a survey.

Longer term solutions include resourcing and properly implementing care capacity demand management right across the hospital, better clerical cover, organising breaks so staff can actually take them and providing safer resources like electric beds.

It remains to be seen how much pressure members need to keep on to make sure the right things happen at the right time.

One thing we are sure of is that members at Dunedin hospital are now actively engaged and have some control over what’s happening in their workplace. 


Why 300 nursing staff stepped up for safe staffing at Dunedin hospital

Organise!We hear from NZNO members every single day how grim the situation is in hospitals around the country.

DHBs are being forced to make massive cuts in their budgets and for some, the way they’re doing it is by squeezing nursing budgets. You can see why they do it, the nursing budget is large, but it is a false economy.

Cutting nursing budgets to the bone means that staff are burning out and leaving, patient care is being compromised, vacancies aren’t being filled, staff are burning out… you get the picture.

NZNO members at Dunedin hospital have finally had enough. A meeting for NZNO members and DHB management was called for the 24 February and to everyone’s surprise 300 nursing staff showed up to have their say and they were not there to nod and smile and accept the same old “but we have no money” story.

The numbers at the meeting are an indication of the scale of the problems at the hospital and how seriously nurses are taking it.

Members and delegates spoke passionately about what’s happening in their wards and units; they talked about feeling desperately worried about not being able to provide the right care at the right time to their patients. They spoke about low morale, fatigue and burnout. They talked about an over 12 percent increase in patient admissions over the last year and the climbing levels of acuity of patients presenting at the emergency department.

Hospital management responded by assuring staff that their concerns were being heard and suggested working groups to look at issues. They also suggested that NZNO was over reacting and pulling an election year stunt. 

Members respectfully suggested that working groups are not the only answer. They said what is needed is urgent action, in the form of more staff, and they were clear that they are not in a position to “find efficiencies”. NZNO members know there are no more efficiencies to be found.

And they are right to be offended that their concerns are considered nothing more than a stunt. Election year or not, when patients are no longer at the centre of DHB decision-making and dollars are, something is sadly awry. NZNO members have an obligation to act.

This is a serious matter. The ability for nurses to provide the right care at the right time should never be used as a political football.

We expect an immediate response from the DHB and a long term solution, including improved funding for safe staffing, to be developed in consultation with NZNO staff and every single affected member.

Dunedin hospital members have reason to be proud of their actions. The journey towards a solution will take commitment and perseverance. We thank each and every one of them for their collective stance and we will continue to support their fight for quality care, a safe working environment and proper staffing levels.