Health NZ commissioner: The health system does not need more money

Tuesday, 23 July 2024

Health NZ’s Lester Levy, who has been appointed as commissioner of the agency on a 12-month basis, says he's committed to finding savings and improving outcomes.

Te Whatu Ora Heath New Zealand’s board will be replaced with a commissioner.

Health Minister Dr Shane Reti says this is due to serious concerns around overspending.

Te Whatu Ora Heath New Zealand is facing an estimated deficit of $1.4 billion by the end of 2024/25.

Professor Lester Levy, the man tasked with finding $1.4 billion in savings and coming up with a “turnaround plan” for Te Whatu Ora - Health New Zealand, has promised to resolve issues in the “bloated” health system within two years and asserted the system does not need more money.

Levy and Health NZ’s chief executive, Margie Apa, spoke to reporters in Auckland on Tuesday in the wake of Health Minister Shane Reti’s move to sack the Health NZ board.

Professor Lester Levy has been appointed as commissioner for Health NZ.

Reti has brought in Levy, who formerly held leadership roles at three Auckland district health boards, as a commissioner.

Levy rejected suggestions the health system had been underfunded, and said he was yet to see any evidence the millions poured into healthcare had been used wisely. He said systems were often duplicated.

Those comments contradicted suggestions from Labour that National did not increase health spending enough to account for population growth and inflation.

“Right at the moment, we don’t need more money, we just … need to spend the money that we've got more wisely. And, you know, if I was the government myself, I would want to see evidence that we're getting value from the money that's been invested,” Levy said.

Lester Levy and Fepulea’i Margie Apa during a press conference at the North Shore Hospital.

“But we have got a lot of resource. I know the scarcity and narrative of doom argument comes up a lot in healthcare.

“We’ve got in excess of $28b in revenue, we've got more than $25b of assets, we’ve got nearly 90,000 people. That sounds like, potentially, if you turn things around, that sounds like that could be an abundance issue if you just used everything properly.”

Dr Shane Reti to replace Te Whatu Ora Health New Zealand Board with commissioner.

Levy said health needed a “different paradigm, a different approach” and insisted he would bring about a philosophical change.

Apa said the agency had over-corrected workforce shortages, including in nursing, which had done great work in reducing vacancies.

“If we go back a few years, we were facing a workforce shortage, particularly in clinical staff, and some of the things that we did early to try to grow both internationally trained nurses in particular, as well as taking on new grads,” she said.

“Over the last six months, we found ourselves actually over-correcting much quicker than what we expected … Our vacancy rates for nurses is at about 6%. When I started this role, it was about 12% to 15%.”

She said more decision-making would be moved to four new regional entities.

Levy said the new entities would have chief executives, which report to Apa, and have “matching authority and accountability”.

“They'll translate that through to their staff so we can have decisions made much more quickly and much closer to home,” he added.

Levy also said he would not be making cuts to clinical staff.

“That pathway we are going down is not to make cuts to the workforce. We are not looking to make our savings over those areas but we are looking to get more productivity out of those areas.”

He said clinical voices should have a stronger role in the new system, and that he would seek to have a more transparent and constructive role with other agencies.