West Coast DHB 'spending more than budgeted for'

2:29 pm on 9 May 2020

The West Coast District Health Board has gone further into the red this month, to fund its response to the Covid-19 pandemic.

Canterbury District Health Board CEO David Meates

West Coast District Health Board chief executive David Meates. Photo: Supplied

The board meeting yesterday heard that Covid-related expenses had piled an extra $100,000 onto the budget, leading to a deficit of $95,000 for the month.

The costs are continuing to come in and the DHB is yet to find out if it will to have absorb them, or if the Ministry of Health will pick up the tab.

Staff costs accounted for 79 percent of the Covid spend; information technology including video conferencing and cellular capability took 19 percent and the remainder went on personal protection gear and clinical supplies.

The DHB now has a deficit for the year to date of $835,000 - which is $91,000 more than it had planned to spend.

Chairman Rick Barker was uneasy about the deficit creep.

"We are spending more than we budgeted for ... I find this hard to comprehend ... it's not a norm for me.

"When we get to set our new budget for the next coming year I want us to be clear that's what we mean and we stick to it."

If the board was contemplating spending more than it budgeted for, that should be a conscious process that the board should be engaged in, Barker said.

Finance director Justine White said the DHB had cut its projected deficit back by nearly $1 million last September, as requested, and flagged that as a risk at the time.

Staff were trying to be as efficient as possible, and looking at ways to continue some of the new ways of doing things during the shutdown, post-Covid.

"We are looking at, what are the ways of working that are better for the patient and better financially, and embedding these, and getting into Te Nikau so we can progress some of those changes."

Chief executive David Meates said health was one sector that could not simply close its doors.

"We are demand-driven; legally we must provide care and some events we can't plan for."

Trans-Alpine service arrangements with Canterbury DHB helped to smooth over the worst of unplanned costs; it would take only three open-heart surgery cases for the impact to be crippling on the West Coast budget, Meates said.

The exercise of estimating health costs had been compared to trying to land a jumbo jet on a postage stamp, the chief executive.

West Coast DHB received $6m in equity funding from the government this month - enough to wipe out its deficit from the previous year.

But delays in opening Te Nikau were causing liquidity problems, and staff were keeping a close eye on them, White said.

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