21 April 2021

Briefly is an occasional publication tracking political and regulatory developments.

A bowl and build agenda for health reform

New Zealand’s 20 District Health Boards (DHBs) and around 30 Primary Health Organisations (PHOs) will be replaced within the next three years by a new Crown entity – Health New Zealand (Health NZ) – which will be responsible for running the hospitals and for commissioning primary health care.

To ensure decisions are made “close to the ground”, Health NZ will create four regional divisions and a range of district health offices (Population Health and Wellbeing Networks) in DHB locations. The networks will be charged with drawing together local health care providers (e.g., GPs, maternity carers, district nurses, optometrists, pharmacists, community mental health services, physiotherapists and dentists) so that records and “care pathways” follow patients among all those contributing to their care.

The Ministry of Health (MoH) will be chief steward of the health system and lead advisor to the government and will also host a new Public Health Agency to provide national leadership on public health policy, strategy and intelligence.

A much larger influence is envisaged for Māori, primarily through the establishment of a Māori Health Authority which will work with the MoH to ensure equitable service delivery to Māori, jointly agree national plans and operational frameworks with Health NZ, including a right of veto at sign-off, and be able to commission services directly.

This is just the first phase in the reform programme. Health Minister Andrew Little said it would be followed by announcements in areas such as funding, workforce and digital health. The reforms anticipate greater access to digital technologies and funding arrangements that make GP consultations and after-hours appointments sustainable for providers.

The Government has gone further than the recommendations of the Heather Simpson led Health and Disability System Review in two important respects:

  • scrapping the DHBs rather than simply reducing their number, and
  • giving the Māori Health Authority a commissioning role rather than making it an advisory body only.

However the Review’s advice has been broadly adopted as have the outcomes it was seeking to achieve of greater equity, access and consistency of health outcomes across different population groups and regions.

For more information, read the announcement here.

A new perspective on New Zealand’s productivity deficit

The galvanising fact in the Productivity Commission’s now completed inquiry into New Zealand’s frontier firms is that the labour productivity rate of our top 30 companies lags that of other small, advanced economies (Belgium, Denmark, the Netherlands and Sweden) by 55% on average.

A possible contributor to this gap is that New Zealand firms are typically “capital shallow” by international comparison, meaning that workers have limited equipment and other capital goods to work with.

The Commission’s central conclusion is that innovation is the key to improving New Zealand’s productivity performance and that some element of planning and specialisation will be required.

The Commission has come up with a sheet of 30 recommendations in its final report, New Zealand firms: reaching for the frontier, released on 30 April. They include:

  • that the Government seek out and encourage foreign direct investment that is innovative and export oriented and that is likely to stay long-term and to provide spill-over benefits
  • that IRD, MBIE and the Callaghan Foundation do a stock take this year on the Research and Development Tax Incentive to identify areas for improvement
  • that the Government select a small number of areas of the economy and devote a “substantial and enduring commitment of public resources” to them ($20m to $40m a year for periods of five to 10 years), conditional upon the private sector at least matching this investment.

The Commission is also recommending that the Government review New Zealand’s migration policy with a view to providing employers with the skills they need while reducing our reliance on low skilled migrant labour. New Zealand currently issues the highest number of temporary work permits per head of population in the OECD.

View the report.

people walking through office

Environment struggling under population pressure

Our Land 2021 – a joint StatsNZ/Ministry for the Environment publication – paints a picture of an environment struggling under population pressure. Among its findings are:

  • a rise in urban land cover between 1996 and 2018 of 14.6%
  • an increase in dairy cattle numbers of 82% between 1990 and 2019
  • a reduction in the highly productive land available for food production (because converted to residential/lifestyle use) of 54% from 2002 to 2019
  • a 91% increase in irrigated land between 2002 and 2019, and
  • an estimated increase in nitrogen applied to the land in fertiliser of 629% between 1991 and 2019.

To learn more, read our Our Land 2021.

Climate change “consensus” ruptured?

National’s Climate Change spokesperson Stuart Smith has written to Climate Change Minister James Shaw asking that the Climate Change Commission’s deadline to finalise its advice be extended to 31 August and indicating that a failure to grant this extension could preclude National from supporting the first climate change budgets.

This would shatter the fragile consensus obtained under Simon Bridge’s leadership when Todd Muller held the shadow climate change portfolio. National also made a submission in which it said the Commission needed more time to address issues raised by submitters, including providing more analysis to support the “over 70” policy recommendations it had made and releasing the information behind its economic modelling and its input assumptions.

Read the National Party statement and the submission.

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