Although health was given a big slice of the total $1.1 billion new spending, the $512 million extra was significantly less than last year's $750 million and well short of what senior doctors and opposition MPs say would be needed just to maintain services throughout the 2010/2011 year.
"Funding for district health boards is short by at least $100 million of what is needed to maintain existing services at their existing level, let alone improving services," said Association of Salaried Medical Specialists executive director Ian Powell.
"It also appears that DHB deficits will be tightly managed, placing even more pressure on the health system and health professionals to maintain good standards of patient of care."
Labour Party health spokeswoman Ruth Dyson today put the level of under-funding in the health sector at $300m for the 2010/2011 year alone.
"The health system is on life support and someone just turned off the switch," she said this morning.
Mr Ryall said the budget commitment was significant during the tight economic times and would protect public health services and maintain DHBs' real spending power.
"Advice from the Ministry of Health is that a $507 million increase would have been sufficient to protect health services against inflation and population growth. We have given more than that."
Mr Ryall said overall the net increase in spending on public health was more than $22m this year alone.
"Funding for primary care is increasing by more than $144 million, and mental health is increasing by more than $174m over the next four years."
Vote Health's total budget was now $13.5b, which was $1.4b more per year than when National came into government, Mr Ryall said.
Opposition MPs have warned about looming cuts to parts of the health sector, including the aged care sector, which has already faced funding cuts in some regions this year.
Mr Ryall said DHBs planned to spend more on home support for the elderly next year.
He said the ministry was on track to consolidating procurement and back office administration among DHBs, which would save up to $700m over five years. Those savings would go back into improving frontline public health services.
"We are also saving an extra $20 million over four years from a reduction in Ministry of Health staff numbers to 1290 by July 2011."
All savings would stay in health, Mr Ryall said.
