From the moment I became Health Minister in February the new Dunedin Hospital has been a key focus of my attention. It is a large and complex undertaking lying at the centre of health care in Otago and Southland.
Having been raised in Te Anau and graduating from the Otago Medical School, I understand the importance of health care to the region and I, too, want the best for the people of Otago and Southland.
Your new hospital is a challenging and exciting project. The outpatient building is due to alter the skyline in coming months and will open in 2025. When the inpatient building opens in 2029, Otago, Southland and New Zealand will have a magnificently modern, efficient and patient-centred teaching hospital.
While we have so much to look forward to with the new facility, I am very aware of one significant issue impacting the project: an extraordinary rise in costs, which led to the Government’s decision late last year to significantly increase funding in response, while also reconsidering some aspects of design.
Experts say they have never seen cost increases across the industry like this; no-one seems sure when it will abate, or reverse.
So, let me say clearly that there will be no further major redesign exercise. There comes a point when the potential savings outweigh the cost and time of redesign. That point has been reached.
If we repeated last year’s redesign process we would simply eat into the clinical fabric of the inpatient building. The Government is not prepared to countenance that.
The savings we secured during last year’s redesign exercise were predominantly of a non-clinical nature, made by different changes to the inpatient building structure. However, there were some changes to clinical facilities. Unlike the changes to the building structure, these clinical changes altered the contents of the business case which Cabinet had approved two years ago. Public attention has understandably focused particularly on these.
In my view, alterations to the business case make sense. In the case of the new Dunedin Hospital I can think of examples where change seems justified, including the decision to shell the PET scanner, and the decision to refine and improve the ventilation capacity.
Each has a logic. It makes sense to shell the PET scanner in the inpatient block, given the private sector has finally made public its plans to have a PET scanner in Dunedin next year. Meanwhile, Te Whatu Ora is progressing work on the role of PET scanning in public facilities nationwide. The shelled space remains available, and in fact part of the funding is being used to upgrade it.
Another example is the 2020 Covid pandemic, which taught us improved airflow is essential to staff and patient safety. So the expense of improving heating, ventilation and air conditioning was warranted.
All these savings and the costs are rather minor in the scheme of things. What they have in common is that they are sensible. We will see more such examples of change before this project is finished, especially in fast-moving areas such as information technology. It makes little sense to plan for yesterday when we have new insights into tomorrow.
Elsewhere, the quest to secure savings has resulted in decisions that, on reflection, are best described as marginal. I’m very pleased to have announced on Friday that the Government has carefully considered advice and will reinstate a third MRI. We have also decided to continue planning for important collaborative work spaces for clinical staff, ensuring they will have adequate space and flexibility to do their work.
Our investment around these two decisions alone is about $10 million, and on top of that the Minister of Finance and I have agreed to an additional $96million to go towards the data and digital infrastructure required to make the new hospital operational.
There are two other areas where I need further information before I decide what to do. These are mental health services for older people and pathology.
Mental health services for older people vary. Acutely unwell patients need a lot of care and attention. But where? In some areas, patients might linger in hospital because there are few community facilities, while in other areas there are no specialist hospital services. The health reforms are designed to address these variations in care.
The new Dunedin Hospital provides the impetus for Te Whatu Ora to investigate what the best model is.
This will take a few months because community consultation is needed. The sole objective is to deliver what is in the best interests of the patient.
Laboratory services are no less important, but the investigation will be quicker. Here the question is whether the allocated space is sufficient to meet the acute pathology needs of the new hospital. Te Whatu Ora has already begun to address this question, firstly by seeking independent health planner advice, then by checking that advice with pathologists and laboratory scientists.
As I’ve said, there is so much to look forward to.
Dunedin’s new hospital will be more than 25% bigger than the existing one, and will include more than 40 new beds and nine new operating theatres.
At now $1.68 billion, this hospital is the largest ever health infrastructure project in New Zealand, and Dunedin will directly benefit.
I would like to thank the clinical transformation group who have focused on three key clinical issues we need to address.
I am genuinely excited for the new hospital’s future and I look forward to continuing the journey with the people who will use, and work in, the building.
