21 Oct 2009

Hundreds of jobs to go in health sector

9:59 pm on 21 October 2009

The Government has announced a major shake-up in the administration of the public health service.

Changes to be introduced immediately will result in the loss of up to 500 administration jobs in moves to streamline bureaucracy and free up $700 million over five years for other health services.

Health Minister Tony Ryall says the money will be used to provide more frontline services, such as heart bypass operations.

The Government says it will set up a new National Health Board in the Ministry of Health to supervise spending by district health boards on hospitals and primary care.

That board will also take over national planning and funding of IT, workforce and capital-investment decisions, as well as for vulnerable health services.

There will be a new shared services agency to consolidate back-office payroll and other jobs that are currently duplicated in all 21 DHBs.

That streamlining alone is expected to remove up to 500 jobs, and yield up to $700 million in savings over five years.

Mr Ryall says the job losses will be partly handled through attrition.

He says there are attrition rates of 16% at the ministry, and job losses there, and within DHBs, will occur over several years.

But Labour's health spokesperson Ruth Dyson says 200 of those jobs were unfilled vacancies.

And she says claims that the changes could save 300 jobs are at the top end of the predictions.

Ms Dyson says establishing a new bureaucratic entity will do nothing to deliver better frontline services to the people that need them.

About 180 jobs are to go from the Ministry of Health, which is to be downsized.

The Government announced this week it has already cut 200 jobs that were unfilled in the Health Ministry as a result of a cap on public service numbers.

More than $12 billion goes into health every year - more than 12% of total Government operating funds - at a time of major belt tightening.

Listen to Health Minister Tony Ryall on Checkpoint

Union reaction

The Public Service Association is warning health service workers are likely to be anxious about their future after the announced jobs cuts.

PSA national secretary Richard Wagstaff believes the government has over-estimated the job cut numbers.

But the union for senior hospital doctors has welcomed the final shape of the reforms.

Association of Salaried Medical Specialists president Jeff Brown says the original plan would have seen a new bureaucracy set up, and there is relief that's not happening.

He says the decision to set up the national health board within the ministry is very sensible as it does not create a new bureaucracy and provides a necessary shake up within the ministry.

Dr Brown says it's hoped the changes will lead to better management of specialist services such as child oncology.

Listen to the Public Service Association's national secretary Richard Wagstaff

Listen to Association of Salaried Medical Specialists president Jeff Brown