Ian Powell: Is the health system an electoral Sword of Damocles for Labour?

The legend of the Sword of Damocles – about the imminent and ever-present peril faced by those in positions of power – is relevant to voters in the 2023 general election, when they contemplate the Labour government’s stewardship of the health system.

In 2017 the Labour-led Government inherited a health system in crisis, with severe workforce shortages.

While this was an inherited, the Government has largely ignored it. Workforce shortages now range between ⅕th to ¼ depending on the occupational group. Even before the pandemic these shortages were impacting severely on access to planned surgery and other treatments, overcrowded emergency departments, availability of hospital beds, and compromised capacity to diagnose patients in a clinically timely manner.

Covid-19 accelerated this, but did not cause it.

The Government’s response was transparently pathetic. In 2018 it trumpeted the formation of a committee; in fact, it was a reconstituted committee with less authority than its predecessor.

The only Government responsiveness was towards nurses, who comprise the biggest part of the DHBs’ workforce. But this was only due to nurses persistent militant industrial action, and the dispute remains unresolved.

Public hospitals are highly dependent on overseas recruitment for medical specialists. Aotearoa New Zealand has one of the highest dependencies on overseas recruitment in the OECD.

We are in fierce competition with Australia. But, whereas the overall salary gap between Australia and New Zealand favours the former by around 20-30%, for specialists the gap is more than 60%.

So why the political neglect? The Government has made a conscious political call to ignore pressures on the health system, and instead focus on restructuring based on advice of business consultants.

The statutory bodies responsible for the delivery of community and hospital healthcare to geographically defined populations (DHBs) are to be abolished and replaced on July 1 by a new additional national monolith: Health New Zealand (HNZ).

Restructuring rarely succeeds in achieving sustainable improvements. But the Government instead listened to external consultants who, unsurprisingly, are the biggest beneficiaries of this restructuring.

Health structures were not the cause of the workforce crisis and neither is restructuring the (or part of) solution. This is an ABC of health systems, but one that the Government has failed to grasp.

Not only has this restructuring distracted government from addressing the real crisis, its rushed nature has meant that the new HNZ is ill-equipped to hit the road running.

Ian Powell was critical of the Government’s decision to abolish DHBs, saying shifting decision-making to bureaucrats in Wellington could have implications on the unique needs of populations – such as those in south Auckland.

HNZ will begin with most leadership comprising interim appointments. They are largely those currently in DHB leadership positions. Ironically, the health minister has scapegoated DHBs for health system’s problems.

The ‘interims’ are capable people who will do their best, but they will be keeping the system going rather than addressing pressures caused by this workforce crisis. This means that there will be a leadership vacuum for some time. Consequently, the workforce crisis will get worse.

In early 2020 National and Labour were neck-and-neck in the polls. National had clawed back a clear lead by Labour that had been deservedly earned by Prime Minister Jacinda Ardern’s impressive leadership in response to the murderous mosque attacks a year earlier.

The Government’s impressive and world-leading response (at the time) to the pandemic led to a complete reversal of electoral fortunate seven months later

Labour’s strong polling continued Until late September it still handled the pandemic response well.

Thereafter, the wheels came off as it resorted to spin rather than scientific evidence to justify its evolving laissez-faire response. Capping it off was National’s election of a competent and confident new leader.

Right now the polls show National a little ahead. Largely this is because Labour has lost its favourable point of difference with National over the pandemic response and is not strong on implementation of various matters, including the health system.

Health is an important electoral issue because of its extensive impact on so many New Zealanders. In the 2017 election health was damaging for the National-led government. The workforce crisis since then has only worsened.

There is no way ‘Team Interim’ (aka Health NZ) will turn this crisis around so it makes a tangible difference to healthcare access before the next election.

But what has made the situation doubly worse is the most incompetent decision I’ve seen made by a government in health – in the middle of a pandemic dismantling the system of provision and delivering healthcare in communities and hospitals and replacing it with an untested alternative which, for some time at least, will have an interim leadership.

By the time of the next election the government will be in no position to blame the workforce crisis on DHBs or the previous government. Labour is trending in the polls towards being under Damocles’ Sword. It will certainly be under it by the time of the election.

Ian Powell is the editor of the health systems blog Otaihanga Second Opinion HERE, a health commentator, and a former Executive Director of the Association of Salaried Medical Specialists. This article was first published HERE.