HBDHB : Financial Sustainability
Sacking Minister Cunliffe claimed that one of the reasons for the sacking of the HBDHB was the alleged rapidly deteriorating financial situation. In his various personal attacks he implied that the HBDHB were reckless and out of control.
At the recent health select committee hearing, Sir John Anderson explained why small DHB's such as HB were now running and forecasting deficits. If the forward funding track (FFT), was for a 3% increase in revenue, yet if MECA settlements came through higher than 3%, then deficits would result.
The following quotes from HBDHB letters to the Minister of Health will show that the board were far from reckless. They were acutely aware of the impacts upon their financial situation of the MECA settlements. The HBDHB tried without success, to engage with the Minister of Health about these matters.
23 November 2006; HBDHB Chair to Hon Pete Hodgson.
Hawke's Bay District Health Boards Financial Sustainability
"In a recent discussion with Hon Rick Barker it was suggested that I arrange a meeting with you both to discuss the options available to move Hawke's Bay District health Board to financial sustainability."
"I would appreciate the opportunity to discuss this situation with you at your earliest convenience."
19 September 2007; HBDHB Chair and CEO to Hon Pete Hodgson
Revised Position Regarding The proposed Nurses Settlement
"You will be aware that the Hawke's Bay DHB originally decided that it was not in a position to support the proposed NZNO settlement.
(because)
(a) Fiduciary Duty of Directors -it would be unwise (and potentially in conflict with the legal obligations as directors) to knowingly go into deficit..."
(c) Affordability - we estimate the direct effect of the settlement will deteriorate the DHB's financial position by $2.5m million pa gross.
"Mindful of the boards fiduciary duties, the CEO has spoken to the Director General of Health...to discuss the issues that the nurses settlement raise."
4 December 2007; HBDHB Chair to Hon David Cunliffe
"The board is, however, keen to engage with you directly on the financial challenges facing the DHB, particularly the impact of the Meca settlements outside of FFT. I would welcome the opportunity to discuss these issues with you directly."
7 January 2008; HBDHB Chair to Anthony Hill, Deputy Director General
"...it is probable, however, that due to MECA settlements being considerably greater than the 2.1% included in our DAP, we will not achieve financial break even in the 07/08 financial year.
To be continued...
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2 comments:
So are you saying DHB's are a sneaky way for Labour to distance itself from the consequences of pandering to it's union backers ? Seems a fair assertion to me.
I think this highlights a broader issue surrounding the use of MECAs - multi-employer collective agreements.
Realistically, we're unlikely to see the end of collective agreements in health any time soon but I would much prefer if the current MECA system was scrapped and DHBs negotiated collective agreements on a DHB by DHB basis or even better, on a hospital by hospital basis.
It would allow competition between different DHBs for staff and it would allow rural DHBs to attract staff with higher wages. It's just not fair that doctors working in the heart of Auckland get paid the same as doctors working out in the boondocks of rural New Zealand.
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