The Finance Minister is committing more funding to health over coming budgets, saying it will take six years for the Government to make up for years of underfunding in the sector

The Finance Minister is committing more funding to health over coming budgets, saying it will take six years for the Government to make up for years of underfunding in the sector

By Jason Walls

Thursday’s Budget and its massive commitment to rebuilding public services was just the opening act of a six-year plan to rebuild the public sector, Finance Minister Grant Robertson says.

Speaking to the day after unveiling his first Budget, Robertson made it clear this area will be a major focus for the Government across its first and second term – if re-elected.

On Thursday, Robertson delivered exactly what he said he would – “a rebuilding Budget.”

Of the almost $10 billion of new spending initiatives, $6.5 billion went into “rebuilding critical public services.”

More than $3 billion of that was for health and included $2.3 billion for District Health Boards.

“We recognised coming into Government that we needed to invest in public services, particularly health, housing and education,” he said on Friday.

“We wanted to lay the foundation for those to be the services that New Zealanders want and deserve.”

The fact Thursday’s Budget would heavily focus on rebuilding was flagged some weeks ago by the Prime Minister, who dubbed it the “rebuilding Budget.”

But Robertson says the Government still has a lot of work to do in this area.

“We certainly know that we have to keep going,” he says, adding that he has always said the Government can’t undo nine years of underfunding in just one Budget.

So how many more budgets until he has fixed the problems Labour says it inherited from National?

When it comes to health, he says six.

He says under this Labour-led Government, the health sector can expect more funding every year – “we have to make up for what hasn’t been put in, in the past as well as what needs to be put in, in the future.”

It’s all well and good for the commitment to be made over the next two budgets but beyond that, Robertson faces a problem.

An election.

“With the nature of the electoral cycle in New Zealand, with our three-year terms, it’s hard to do all of the things you might want in any given area,” he says.

But, historically speaking, Robertson has good odds. The last time New Zealand had a one term Government was in the early 1970s.

A predictable Budget

On Wednesday, Ardern said the Budget would be predictable. If the reaction is anything to go by, it’s safe to say it lived up to that prediction.

In fact, some went as far as calling it a “boring Budget” with very few big-ticket items outside what had already been announced.

But Robertson says people need to remember the Government unveiled a mini-Budget in December, which included initiatives such as the $5.5 billion families package.

This was done so the initiatives of the package could come into force by July 1 this year.

“If you put together the families package, - $5.5 billion over four years with the investments that are in this Budget, I think you could see a Budget that does a lot. If people want to call it boring that's up to them.”

We welcome your help to improve our coverage of this issue. Any examples or experiences to relate? Any links to other news, data or research to shed more light on this? Any insight or views on what might happen next or what should happen next? Any errors to correct?

We welcome your comments below. If you are not already registered, please register to comment.

Remember we welcome robust, respectful and insightful debate. We don't welcome abusive or defamatory comments and will de-register those repeatedly making such comments. Our current comment policy is here.


Comment Filter

Highlight new comments in the last hr(s).

Labour does this or we end up another sweat shop hell hole. Under National we were sliding into third world status.

Thank goodness that's over.

Yeah if i wanted to live with inequality I'd move to China

No need China is coming here

I think Robertson doesn't quite realize that the current massive surplus is the result of the previous government's governance. It is, make no mistake about it. Before we get too political, I will gladly agree that National did bugger all to improve things and have been sitting on their hands for far too long. Robertson assumes that this surplus will continue over the next ... many years, at a GDP growth of 3% pa, compound, which will allow him to dish out the goodies. I personally think he's in for a shock. On one hand it's likely there will be a major event (totally outside this governments's hands) that will put the brakes on growth and on the other hand Robertson still has to prove he can keep growing the economy at the current pace while delivering on the many, many promises the government has made.

That said, when commentators pointed to all the anemic economic signs last year or the year before, Bill English's assessment of why the economy was in his opinion doing well was, "Well, house prices are going up and immigration is high".

If that is what the economy is built on, how well are we actually doing? How do sugar rushes usually end?

I saved $500 by not purchasing tyres on my car, and saved another $150 by not paying reg and WOF. Didn’t get an oil change there’s $50. I paid my last 2 years rates bills with my credit card, the council charged me 3% transaction fee.

Yay surplus!

I bought a BMW730 Diesel .

Paid for a Chauffeur,

Paid for his house,

All expenses claimed.

And had to pay for mine.

Paid for the Privileged,

Paid my taxes...too.....weep.

Should have been a thieving MP, plus free houses, plus all a bleedin Knighthood.

How stupid was I.

Praise the Lords..., least it is Friday, so this must be a seriously.

What ? want a denial...we are all equal under the sun...No shortage of Houses.....if ya know how to "work the system"

What a 30 million Council there's a bargain.

Kiwi Built?...Hawaii bound. Beware the Rocky Islands...and the rocky Rookie...Pollies...

Here I come...Taxpayers...I learn't my lesson well. Why work.

Vote for me....Have I got a deal for you...

After years of complaining about Health spending not keeping up, why did Labour increase it by less than National did in its last Budget?

Because they are going to spend all the money buying investment properties off the Chinese at the height of the market. Maybe nurses will get a pay rise next year.

What Chinese in which housing bubble?

So how concerned were you for nurses when National underfunded DHBs to the point staff who left weren’t replaced? The ones who stayed have been worked to the point they’ve either burned out or left.

I think had National been re-elected the plan was to continue underfunding public health to the point it fell over and say “ah it doesn’t work” then privatise. By stealth. Utter, wreckless vandalism.

It remains to be seen if it can be saved.

I use that tactic when I want to get out of housework. Do a terrible enough job at it and the wife just decides it’s easier and more effective to do it herself.

The facts are that in each of their last 9 years National increased funding for Health in real terms after adjusting for inflation and per capita terms thus capturing immigration.

Health has an insatiable appetite for funds.

Could National have spent more - yes.

Could we afford it in the context of a GFC, huge deficits, three major earthquakes, RENA - highly debatable.

Health is one industry that has managed to maintain part of a mystical aura, probably because it serves us when we are at our most vulnerable. However, if the nurses aren’t getting the $, then whose snouts are in the trough? Two examples in our family. $4,000 for a 25 minute colonoscopy and the same for cataract replacement, neither of which public health would offer (too young and too old, in each case)

Looks like you are wrong about that. A quick Google search of "core crown health expenditure since 2009/2010" brings up a report which shows spending per capita in real terms going backwards. Not surprising from a govt who wants smaller govt.

Gillybee - best look at the numbers rather than pre-election politically biased rhetoric - in this budget Labour increased the health vote by less than National did in 2017 - can't be a crisis, can't be underfunded ? Their spending is planned to be less overall as a percentage of GDP than National was spending - I can't complain about that personally, but if National was planning to run down health with some great master plan, Labour sure seems to want to do it quicker ?

That is only true if you count the government being forced to pay 1.5 billion by the courts in pay rates rises for the pay equity lawsuit. Which the government appealed and delayed as much as they were legally able to. So that cannot be characterised as normal health spending by National.
The fact Simon Bridges is pointing to that fact as a main argument shows his opposition is aimed at casting unfounded doubt at the government rather than finding a positive way forward for the country.

Your access to our unique content is free - always has been. But ad revenues are diving so we need your direct support.

Become a supporter

Thanks, I'm already a supporter.