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two hands looking like they're in a medical setting with palms out, coins imposed and a blue background with a 'budget 2024' sticker on top
Health is getting a boost in the 2024 Budget? (Image: The Spinoff)

PoliticsMay 29, 2024

What the budget has in store for health

two hands looking like they're in a medical setting with palms out, coins imposed and a blue background with a 'budget 2024' sticker on top
Health is getting a boost in the 2024 Budget? (Image: The Spinoff)

During the election campaign, the National Party made a lot of promises about healthcare. Will they follow through in Budget 2024?

Healthcare spending is always a key area of focus in budgets, and 2024 is no different. Prime minister Christopher Luxon has said there will be more money for “healthcare in general” when the budget is released on Thursday, but detail has been in short supply. Meanwhile, those in the healthcare sector point to chronic underfunding, with junior doctors and NZ Blood workers negotiating for fairer pay and conditions, and healthcare unions saying instructions to reduce overtime and cut costs put patients at risk. The government is also being reminded of its election promises, like the commitment to fund 13 cancer drugs currently subsidised in Australia. 

Finance minister Nicola Willis said “you can expect a significant funding boost for the health system” in a pre-budget speech earlier this month. But where is this money going? And what has the healthcare sector asked for? Here’s a brief guide. 

a woman and man both wearing a blue suit, walking down a red carpeted hall with smiles
Nicola Willis and Christopher Luxon (Photo: Supplied)

The spending that has been signalled

In pre-budget announcements, Christopher Luxon has said that Pharmac will have its biggest budget ever, receiving $6.3bn over the next four years. However, as costs increase across the board, this money probably won’t be able to pay for any new medicines, and will simply continue to provide medicines that are already funded. 

The government has the first-ever mental health minister in Matt Doocey and more funding for mental health will be in the budget. $24m will go to Mike King’s charity I Am Hope (which runs Gumboot Friday) to provide more counsellors for young people. Increasing funding for Gumboot Friday was part of New Zealand First’s coalition agreement with National, although the charity’s relationship with the government has been scrutinised due to its connections with the National Party. 

a green background with cartoon dollar signs and bottles of pills on a green background
Free prescriptions were a major announcement in last year’s government budget (Image: Archi Banal)

What healthcare workers want: better pay and better staffing

Allied health workers, which include physiotherapists, acupuncturists, occupational therapists, optometrists and pharmacists, have said that investing more in these services would save the government money in the long run. “Within the current health system, [allied health workers] are often underutilised due to funding and referral models,” said Sandra Kirby, co-chair of union Allied Health Aotearoa New Zealand, in a press release. “Increasing Kiwis’ access to these services would give them the power to address health concerns sooner, potentially saving people from needing expensive or delayed hospital treatments. 

Nurses have uneven pay, depending on where they work, with hospital nurses paid more than primary care and aged care nurses. Changing this disparity has been a long-term campaign for the New Zealand Nurses’ Organisation. “This is a seriously big deal because we’re going to lose half our workforce to retirement in the next 10 years, so pay parity with Te Whatu Ora is not a want; it’s a need! I think it’s really important that Budget 2024 reflects that,” said Gisborne general practice nurse Ayla Evans in a NZNO press release. Workers for the New Zealand Blood Service, who are striking for half a day this week, also want to be paid the same as workers employed by Health New Zealand – Te Whatu Ora. Currently, they’re paid as much as 35% less. 

a cartooon scale with people on each side
Image: Tina Tiller

Radiation oncologists under pressure due to understaffing have said that limited numbers of new trainees and ageing equipment is a major risk for cancer patients. A survey from the Royal Australian and New Zealand College of Radiologists released on Monday recommended increasing the number of radiation oncologists, replacing equipment in a timely manner and ensuring sustainability through training. 

A briefing issued to health minister Shane Reti in January, released to Stuff under the Official information Act, shows that shortages of GPs are also acute. According to the briefing, the primary care sector, many people’s first point of contact with the health system, would “struggle to train or bring in enough international medical graduates to meet this demand”. It estimated that New Zealand was short of 485 GPs needed for patients around the country. Meanwhile, the junior doctors who have been striking this month have been asking for better conditions – many work as much as 71.5 hours in seven days – and to reverse a proposed pay cut for trainees in psychiatry, radiation oncology, pathology, public health and general practice. 

Staffing issues are a major concern across the health workforce. The government’s cost-cutting has led to a proposed 134 jobs going at the Ministry of Health. Health NZ has also placed limits on hospital staffing, such as replacing people who can’t work shifts because they’re sick, in order to reduce costs. The medical union pointed out that staff taking overtime or double shifts was due to staff shortages in the first place. 

Trainees in healthcare positions, including midwifery, counselling, nursing, and medicine are required to work hundreds or thousands of hours without pay in order to gain their professional accreditation. The Paid Placements campaign delivered a petition signed by 16,000 people to parliament this week, asking for trainees in these roles to be compensated for these hours. Education minister Erica Stanford recently announced a limited stipend for some teacher trainees, but the same has not been seen in other sectors – will it be in the budget? 

a collage of a nurse putting on a mask and a social worker helping an older person stand up ripped apart by money
Demanding unpaid work placements can put extra pressure on students in needed roles, campaigners say (Image: Tina Tiller/Getty)

Funding with question marks 

During the 2023 election campaign, the National Party said if elected it would fund 13 cancer drugs identified by the Cancer Control Agency, and pay for them by restoring the $5 payment for prescriptions for most people. Christopher Luxon said that $280m would be ringfenced for Pharmac to procure the drugs, which are funded in Australia but not New Zealand, over four years. 

However, when asked about this commitment in the lead-up to the budget, Luxon and other ministers have said that not every problem can be solved in one budget. “We are really committed to it but it’s going to be a bit of a programme of work of continually trying to expand access and drugs for New Zealanders,” he told Newshub on Tuesday. There are other challenges facing cancer treatment too, which the government has said is a priority. Specialist roles for senior doctors identified outside of major cities have gone unfilled for more than 18 months, but payment requested for the 2023 budget was crossed out, according to RNZ reporting. Sarah Dalton, the executive director of the Association of Salaried Medical Specialists, was quoted describing cancer care as “on the brink of collapse”.

If the cancer drugs aren’t being funded, what will happen to the $5 prescription charges that were removed in the 2023 budget? The initiative was funded for four years, at a cost of $618.6m in total; means-testing the fee removal and having an annual cap for family prescriptions fees would save $316m, according to reporting during the election campaign.

Another election promise that presumably won’t receive funding this budget is the creation of a third medical school at Waikato University. The university has withdrawn its call for tenders for developing the medical school; National and Act’s coalition agreement mandates that a full cost and benefit analysis be completed before funding can go ahead. 

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