17 Apr 2015

Southern DHB expects $42m deficit

6:46 pm on 17 April 2015

The Southern District Health Board expects its financial deficit to blow out to more than $40 million next year, according to a leaked report.

Dunedin Hospital.

Photo: RNZ / Ian Telfer

Southern DHB's deficits have been growing since it was formed by merger in 2010, despite a series of management changes and external cost-cutting advice.

The one-page, internal Government report was released by the Labour Party.

Despite better results in January and February this year its current year deficit forecast has almost doubled from $14 million to $27 million, the document said.

"Governance options are being progressed to assist in addressing this," the document said, though it did not spell out what they were.

"The first draft financial templates for the 2015/16 annual plan indicate a $42 million deficit," the report went on to say.

"The NHB (National Health Board) advised the DHB that this is unacceptable. The Board is considering further savings proposals in April/May 2015."

The Board's chairperson said its projected financial deficit will be slashed.

Joe Butterfield said the board and management had been reviewing why the deficit blew out, and though some costs were out of the board's control, it would make a range of changes next year.

Mr Butterfield says the $42 million deficit was never going to fly.

He said the board would go through next year's budget line by line to find savings.

Labour Party deputy leader Annette King said the board was in serious freefall, and there should be an independent review of its funding.

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