The Dunedin unit was one of just four places in the South providing the highest level of dementia care to D6 psychogeriatric residents when its closure was announced last month.
A critical lack of staff was cited by owners Presbyterian Support Otago (PSO) as the reason, reflecting the nationwide aged-care staffing crises that is among the problems yesterday’s funding announcement aims to tackle.
Health Minister Andrew Little said the Government would provide $40 million for the remainder of this financial year, and $200 million a year after that.
The funding targeted health staff, including nurses, who did not work in hospitals or directly for Te Whatu Ora Health New Zealand or the Maori Health Authority, but whose employers had contracts with the organisations.
This included aged-care centres, hospices, mental health and addiction services, Maori and Pacific healthcare organisations, and residential care for disabled people.
It would mean a pay rise for about 20,000 people, he said.
"[Organisations] employing them ... have struggled to keep staff when they can’t afford to pay as much as Te Whatu Ora Health New Zealand is offering."
However nurses in general practice clinics were not included in the funding, Mr Little citing a lack of evidence of pay disparity.
PSO chief executive Jo O’Neill said stability in the workforce was needed before the 24-bed unit could reopen.
"We are hopeful the impact of pay parity will enable us to attract more nurses and allow us to plan to reopen the Lindsay unit."
Details were needed before the impact could be assessed, but PSO expected pay parity would improve its staffing situation.
PSO congratulated the Government on the funding for which it had long advocated.
However, more funding for staff such as cooks and cleaners was also needed to improve aged-care, she said.
New Zealand Aged Care Association Board southern representative Malcolm Hendry said he was pleased the Government recognised the need for immediate action.
The raw numbers suggested it would be enough to address the pay parity gap, he said.
"We’re celebrating this, because it’s been a long battle."
"It’s been a significant contributor to the loss of registered nurses to the public hospital system."
An immediate pathway to New Zealand residency for qualified health workers was also needed, he said.
Otago Community Hospice chief executive Ginny Green said it was a "wonderful" decision which recognised industry struggles.
However the hospice was only partially funded by the Government and she was unsure what the impact would be.
"The devil’s going to be in the details. We don’t know yet how it’s going to be calculated and how it’s going to be paid out."
Aged Care commissioner Carolyn Cooper and Aged Care Matters convener Norah Barlow both welcomed the announcement, although noting change was overdue.
General Practice Owners Association of New Zealand chairman Dr Tim Malloy said, however, that it was "incredibly insulting" that general practice nurses were again being treated inequitably.
This would further an exodus of nurses and put the future of family doctor services at risk, Mr Malloy said.
