An analysis of health expenditure released today estimates the Health vote in the Budget will need to be increased by at least $555 million just to keep pace with population growth, ageing, new treatments, new technology, and increases in general costs, pharmaceuticals, and salaries.
The analysis, undertaken by the New Zealand Council of Trade Unions, shows the $555 million estimate is over half (50.4 percent) of the severely reduced $1.1 billion that the Government has said it will allocate to new spending in the 2010 Budget.
It is well above the 40 percent of the operating allowance (equivalent to $440 million) which is the assumed allocation for Health in Treasury forecasts such as the December Half-Yearly Economic and Fiscal Update
“This is only what is needed to stand still,” said CTU Policy Director and Economist Bill Rosenberg. “If we want improvements in the health system or to address existing problems such as persistent deficits in district health boards and loss of services, further increases in funding are required over and above this.”
The Government has indicated it will fund some health and education funding from ‘savings’ across the public sector.
“The CTU and its affiliated health sector unions have made this estimate so that we and the public can judge whether the Health vote announced in the Budget on 20 May provides for improved health services, or is really a cut in those services, or a stand still,” said Rosenberg.