19 Sep 2019

Cost of fixing DHB payroll breaches revealed

2:42 pm on 19 September 2019

Several district health boards have come up with multi-million-dollar estimates of what it will cost to fix years of payroll breaches.

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The pay miscalculations stretch back to 2010. Photo: 123rf

But the true picture is only expected to emerge from this point on, as a nationally agreed way of auditing the DHBs begins.

Northland DHB is first up, with the board and unions now working together using the national guidelines - that took three years to agree on - to arrive at a firm figure of who is owed how much, stretching back to 2010, due to miscalculations of shift allowances and leave.

Northland had estimated earlier this year that the full fix would cost it $16.5 million.

Hawkes Bay DHB's estimate was $7m, pushing its deficit in 2018-19 to $28m; and MidCentral DHB's estimate was $4.2m.

Many other DHBs appear not to have made such estimates and are instead waiting for their turn under the nationwide audit.

However, one party to the Northland audit, the Association of Professional and Executive Employees, said the early signs were the DHB's previous estimate was too low.

"Now we have an agreed set of principles [to audit by], the figures may be different, and what we are finding in Northland is they probably are," said association spokesperson Deborah Powell.

The Nelson-Marlborough DHB used Northland DHB's previous estimates, to put its own exposure at $8.5m, a key factor in a blowout of its deficit this year to $20m.

The unions were also finding it was taking quite some time to apply the nationally agreed way of auditing on the ground in Northland, raising the prospect of further delays in staff being paid what they were owed, Dr Powell said.

Next up is Auckland DHB, where the audit is beginning as part of a staggered rollout designed to lessen the huge strain on resources including payroll industry expertise.

"We'll get on a roll and hopefully it will get easier as we get further south," Dr Powell said.