24 Jun 2014

HBL to work more closely with DHBs

8:30 pm on 24 June 2014

Health Benefits Limited says it needs to engage more with District Health Boards as it implements a work programme that has been the target of criticism.

The Government's flagship initiative was set up in 2010 to find $700 million of savings by consolidating some of the back-office functions of district health boards.

A document obtained by Radio New Zealand News says HBL is the single biggest threat to the public health system in a generation and bears a striking resemblance to a ponzi scheme.

The informal memo written by a senior manager of a DHB outlines concerns about cost over-runs and delays to projects, and money coming out of boards and not coming back to frontline services.

HBL's chief executive David Wood said on Tuesday there have not been cost over-runs in the programme and it is working with DHBs to rethink the rollout of a finance system.

Mr Wood concedes there has been opaqueness in HBL's dealings with DHBs and the issues raised in the document are being addressed.

A new management and a new approach are coming into the company and HBL intends to work in close partnership with district health boards.

The Auditor-General's office says it is aware of concern within the sector, but has not been asked to investigate the matter.

Pure politics, says Government

The Government on Tuesday said any claims that Health Benefits Limited resembles a ponzi scheme are pure politics.

Health Minister Tony Ryall wasn't in the House to answer questions, but associate minister Jo Goodhew answered on his behalf. "Any claims of ponzi schemes, 12 weeks out from an election, certainly sound like the sort of political rhetoric we would expect," she said.

A group letter from chief financial officers of DHBs was tabled in the House last week expressing their severely diminished confidence in the programme.

Association of Salaried Medical Specialists executive director Ian Powell said it has had these concerns expressed to it privately by DHB managers for some time.

"The difficulty is that they feel that in the current climate that there's so much politics attached to the Health Benefits Ltd initiative that they can't really give voice to their concerns and that their voice is muted."

Labour's health spokesperson Annette King said she understood huge pressure had been put on DHBs to comply with the initiative.

"That pressure comes right from the top, so any responsibility for this project in terms of it costing taxpayers lots of money and not working goes straight to the minister."

Ms King said questions had been raised about HBL for a year, and something needed to happen.

She said it was public money and when public financial officers, in particular, said they were very concerned about the project then people needed "to sit up and listen".