The new southern region tertiary hospital should be built as planned. Here are some relevant reasons why.
Scale
This is an essential tertiary hospital catering for 350,000 Otago and Southland locals plus high numbers of tourists plus the rest of the South Island in the inevitable event of an Alpine Fault rupture of magnitude 8 or greater. It is not just a Dunedin hospital. At present it is designed at the size it needs to be after many years of exhaustive consultation and specialist review. Any reduction would negatively impact the healthcare of this region.
Economic development
This new hospital is a vital piece in the jigsaw of economic development in the South. Dunedin is an education-based city, and this hospital is not only tertiary in the sense of its level of care but also its function as an adjunct to the tertiary education providers. I refer not only to the medical and dental schools, but also to the University of Otago, Otago Polytechnic and Southland Institute of Technology. This region does not just develop doctors, dentists and nurses, we train the full range of health science practitioners plus engage in world-leading research which regularly leads to new business opportunities.
The value of Dunedin Hospital reaches far beyond the healthcare of its patients, its educational output and its direct business contribution.
It is vital to the growth and prosperity of the region, and it supplies highly trained professionals for the whole country. These highly trained people work throughout New Zealand and typically earn at above-average levels thus increasing the overall productivity of our population.
Our place in the world
As an education city, with highly ranked institutions working out of exceptional heritage buildings as well as some fine and architecturally inspiring new facilities, it is genuinely important that the new hospital is built to a suitable standard. Some commentators have expressed the view that an eye-catching new construction will markedly assist recruitment as well as enhance Dunedin’s built environment. Do we want a patched-up old brutalist tower block or should we aspire to create a well-connected and efficient centre of excellence in the medical world?
False economy
Cost-effective management of operational expenses saves money every year. Opinions have been voiced that redesigning and patching a set of disconnected old structures might look like a capital saving at the beginning but is highly likely to cost more in the end and take much longer to construct with a significantly reduced lifespan. Capital costs might look easy to cut but if they create increased operational expenditure, the pain will be felt year after year. If the project is built right, quality and efficiency will remain long after the price is forgotten. The converse is also true.
Sunk costs
Outpatients will be ready to open next year. The already designed inpatient building has piles in the ground and plans in the site office. There is considerable cost sunk into this building already and much effort has been put into identifying savings likely to bring the price closer to the desired figure of $1.9 billion. The public of our region appreciate the additional investment that this government has already committed to the project but please do not let reluctance to inject a relatively small amount of extra capital prevent execution of the current clinically rigorous design. As the old saying goes: "Don’t spoil the ship for a ha’penny worth of tar".
Delay costs money as well as time: this construction was costed at $1.2b in 2007 and now sits at $1.9b seven years later, an escalation of $100 million per year.
A delay involving complete redesign with a lengthy and disruptive construction process would add several years. Any expected capital expenditure savings could easily become additional expenses and then there are extra operational costs to be considered due to the disruption of providing clinical services in a building site.
Investment
I quote Emeritus Prof Dame Linda J. Holloway from her address to graduates after receiving an honorary Doctorate in Laws from the University of Otago in 2024: "Improving the health of populations should be regarded as an investment that leads to an improved national economy rather than as a cost."
The promise
Very clear and unequivocal promises were made to Otago-Southland residents about this facility ... "the next National government will build the hospital Dunedin needs, with all the beds, theatres and radiology services that Labour removed".
The disappointment of a reduction in scope or scale would deeply affect political trust in this region noting that there are five current government MPs here and 10% of the region’s population marched in Dunedin to voice their objection to any cuts. Additionally, health professionals who have trained or worked in Dunedin have strong connections to their alma mater. They are spread throughout New Zealand and the world. They are also voters.
Minister Reti has already received hundreds of postcards from voters throughout Otago and Southland. That flow will continue as shops and offices throughout the region make them available for people to post to him for free.
I appreciate Ministers Reti and Bishop visiting Dunedin in September 2024 and reinforcing their commitment to delivering the modern, fit-for-purpose medical facilities they know are needed in Dunedin and the South. It should be abundantly clear from numerous articles and commentaries by specialists and clinicians that the plans already produced are the fastest and most effective way to deliver those facilities and that the need for them is urgent.
It’s time to get on with the job; Build it once, build it right.
• Jules Radich is the mayor of Dunedin.
