Photo: RNZ
The figures relating to the number of nurses have been updated, at Te Whatu Ora's request on 9 December 2024.
The Health Commissioner's claim during Parliament's scrutiny week that "overspending" is to blame for Te Whatu Ora's financial crisis has outraged health workers and their unions.
Health NZ reported a $722 million deficit for the 2023-24 year on Tuesday, and forecast a $1.1 billion loss in the current financial year.
During a marathon six-hour hearing of Parliament's health select committee on Wednesday, Professor Lester Levy told MPs that Health New Zealand had hired more staff than it needed, but "productivity" had fallen.
"Our system has got elasticity for performance improvement within the resources we already have, and we should be making sure we achieve that before we look for additional money," he said.
"Because the reality is additional money has been provided, and the service hasn't improved."
Health Minister Shane Reti and Health New Zealand commissioner Lester Levy. Photo: RNZ / Nick Monro
Cost-cutting adding to costs - union
However, union leader Dr Deborah Powell - who represents resident doctors and allied, technical and scientific health workers - said indiscriminate cost-cutting and redundancies were pushing Health New Zealand further into the red.
"And that's because the process itself is generating more cost. It's putting us all through a great deal of stress and it's not solving the problem.
"In my personal opinion, he's got it wrong. We are under-funded and what is going on at the moment is making the situation worse."
Many redundancies were not "redundancies" in the real sense, because the work still had to be done, she said.
"For instance, we've had a clinician, who was in a management role for one day a week and four days in clinical practice, take voluntary redundancy.
"So we've lost those four days' of clinical practice - in a shortage speciality - and they are having to bring in a locum.
"We've paid redundancy to someone and then replaced them with someone on a higher hourly rate."
The "hiring freeze", cuts to capital expenditure and voluntary redundancies had not made a dent in the deficit - but were making the system less efficient and loading pressure on remaining staff, she continued.
"Because we are so short-staffed - and getting more so with the cost-cutting - annual leave is mounting. So that's a large liability on the books that's eventually going to have to be paid out or given to people one way or another."
Northland emergency doctor Gary Payinda, who was speaking in his "personal capacity", said it was infuriating for health workers to be told that the problem was overspending.
"If you make a budget that can't provide for doctors in hospitals and can't provide for nurses at safe staffing levels, then your budget wasn't a legitimate budget. It was an imaginary budget."
The $2.1 billion dollars in tax-cuts being given to landlords over the next four years could have solved many problems in health, he said.
Health NZ responds
In a statement to RNZ Sunday, Health New Zealand Te Whatu Ora Chief Executive Margie Apa said the claims that job cuts were costing more were incorrect.
"Claims that Health NZ is underfunded, and our reset is causing a greater budget deficit, are incorrect," she said.
"Health NZ received more government funding in the most recent Budget than ever before.
"We have made some good progress towards living within our means, but we are still overspending.
"Over the past year we have recruited more clinical staff than ever before. We now have 4,107 more frontline staff than we did a year ago, which is about as many new FTEs in the two previous years combined.
"The number of nurses employed by Health NZ has also grown steadily over recent years, with a total now to around 30,000 FTEs (with a total headcount of 35,000)," Apa said.
Sign up for Ngā Pitopito Kōrero, a daily newsletter curated by our editors and delivered straight to your inbox every weekday.
