In March Sir John Hansen appeared before Parliament’s Health Select Committee and he was reported by Stuff as saying:
The resignations of seven senior Canterbury health board managers within six weeks may have helped the woeful financial position of the region’s health system, the board’s chair says.
The Canterbury District Health Board (CDHB) has posted a $243 million deficit for the year ending June 2020. The forecast deficit for this year is still being determined.
Addressing a Parliamentary health select committee on Thursday, CDHB chair Sir John Hansen said he did not believe the spate of resignations last year had been detrimental to the board’s finances or services.
“In actual fact there might be savings because we brought in acting chief executives with the experience we felt were needed … but the other roles were filled by the people … who have stepped up. So I don’t think there will be a financial impact.”
This presentation led me to write in March:
A few facts for the CDHB Chair and the Crown Monitor to consider. My responses some months later are written in red:
- I am led to believe that the Auditor General met the Board of CDHB as the Crown Monitor was disputing the fact that the CDHB had a very, very good external Audit report. The AG would not change the report despite pressure (which says a lot about the AG). This reflects just how robust the systems and processes that were in place within the DHB, disproving the accusations that the financial system was badly managed. [Result of my observation…100% correct]
- By saying that the resignation of 7 of the most experienced heath leaders in the country has had no impact on fiscals and performance, and in fact may have helped the financial position, highlights just how out of touch the Board is with what is actually going on in the Canterbury Health system. We are hearing from internal sources within the DHB, the deficit is growing, surgical performance is behind plan, Christchurch hospital is struggling with patient demand and morale and engagement are at an all- time low. [Result of this observation….100% correct]
- Have they forgotten that they directed the CDHB Executive to reduce expenditure by over $100m last year! What has happened to this target now the old executive has been pressured into resigning? [What has happened with this target…I suspect it was a complete failure]
- Have they forgotten that that the EY commissioned review has delivered nothing (except more cost to the DHB)? ;[Result of this observation….nothing achieved]
- That the Chair of the QFARC (Quality Finance Audit Risk Committee) has been in place for over 5 years and guided the DHB with its financials? [Correct]
- Have they forgotten that the there was a 4-year plan to get back to break even already in place that was dependant on the new Christchurch Hospital being delivered on time – NOT three years late? [Response from the CDHB Board….silence]
- That the building mentioned above was managed by the Ministry of Health.
- Of the acting CEOs
- Andrew Brant from Waitemata had never been a CEO nor been involved in leading any organisation of the size and scale of CDHB
- Peter Bramley has come from a small / medium size DHB that does not have any of the complexity of CDHB
What we have at the head of the CDHB is a Board which has, with three exceptions, accepted bad advice from politicians who have been badly briefed by MOH and Treasury and adopted this advice. They have remained compliant to the will of their Wellington masters in MOH and Treasury. They continue, to this day, to white ant the previous executive and state that they will reduce the deficit. There are good people on that Board. I can’t figure why have they been so compliant to Wellington?
Let me make a prediction. The deficit will be in excess of $200m in the year which concludes in 10 days. It will be worse than what was projected by the previous executive who managed the fragile relationships between CDHB and the GP network. When you go back through all the performance data contained in OIAs that have been released, CDHB through its integrated system approach was admitting approx. 30% fewer medically unwell patients compared to the rest of NZ.
This was part of an approach taken by the DHB to manage a major bed shortage over the past decade and to ensure that elective and acute surgeries could continue to take place even during some of the most trying circumstances experienced anywhere in NZ. It would appear that this trusting relationship between CDHB and GP’s has ceased.
It is so incredibly sad. Headlines such as Christchurch Hospital implosion: long delays, staff shortages, overcrowded wards take us back to the early 2000’s which was when CDHB was a mess. It took an incredibly long time to rebuild trust and confidence and over the past decade. Canterbury has been able to weather every single challenge that has been thrown its way. Now it’s performing just like all the others.
Yet Canterbury has a Board and Crown Monitor…
- the majority of whom voted to get rid of the most experienced executive team in NZ who had built an integrated system which has been the envy of the world.
- who committed to a smaller hospital re-build than had been recommended by the Executive, and clinicians, based on hard evidence.
- that boldly said that they could sort out a deficit and employed expensive consultants to show them how including determining that Christchurch Hospital had 500 too many nurses!!
- who accepted that Canterbury had enough funding.
Long delays, staff shortages, overcrowded wards and an even bigger deficit on the way. To quote from the Press – This month’s board agenda noted “actual savings have not reached the level expected, and it is likely that we will not achieve this level of savings.
What a legacy that this Board is leaving for the people of Canterbury. When the Press asked the CDHB Chair to comment here is what happened:
Board chair John Hansen refused to comment, and a CDHB spokesman said it was unable to comment by deadline.
Is this John Hansen’s “Do-not-adjust-your-mind-reality-may-be-at-fault” moment?
Jamie Gough commented in the Press:
Gough said he was tiring of his previous view that the Board should focus on meeting the expectation of the Ministry and the Minister to cut the deficit. “I just can’t help but feel the ministry …. Is on a completely different planet and not seeing the same hospital and healthcare system that I am seeing.”
Jamie – just in case you didn’t notice – this was why the previous Executive left!! You joined others as they rubbished those of us who were critical of the thuggish tactics which were being implemented from Wellington. Join our team.
Here’s a link to the Press article https://www.stuff.co.nz/national/health/125450407/christchurch-hospital-implosion-long-delays-staff-shortages-overcrowded-wards.
The Tuesday Club has been approached by staff within the DHB who are too afraid to raise issues about the DHB. It really is an institution operating under a cloud of fear. This is a state so different from what it was like under the old executive.
In Ian Powell’s latest blog titled “Dirty politics in the form of a smear campaign in New Zealand’s health system” about the tactics which were used to roll the old executive. Here’s an interesting number of paragraphs which make interesting reading.
Treasury has a process called the Investor Confidence Rating (ICR) for independently assessing the capability of DHBs and other public sector agencies to run and manage assets and capital projects. For 2016 Canterbury DHB was assessed as a ‘B’ which was the second highest ranked DHB (Counties Manukau, whose new Chair Lester Levy was attacking its financial management – note the pattern – scored an ‘A’).
According to releases under the Official Information Act the Health Ministry attempted to overturn CDHB’s ICR assessment (or alternatively have it not published) because it was contrary to what it had been advising government. The resilient CDHB senior management forced the issue leading to the results being confirmed and released.
The ICR process was again undertaken three years later (2019). Once again CDHB achieved a ‘B’ rating which this time was the highest of all the 20 DHBs. Ironically, largely under the leadership of Lester Levy Counties Manukau dropped from ‘A’ to below ‘B’.
What about other business consultants? In 2015 PricewaterhouseCoopers was commissioned to review CDHB’s financial position. Its first report published in December led then Health Minister Jonathan Coleman to conclude that CDHB was in a “relativity stable financial position.” It also confirmed that earthquake recovery was the driver of CDHB’s financial challenges.
As for a completely independent assess one can go no further than the Crown auditors, Audit NZ, whose responsibilities include ensuring that audit results are tabled in Parliament. It is independent of crown agencies and departments. If one can’t trust Audit NZ’s financial audits, who can you trust?
Over the past decade of its audits Canterbury was either the highest rated DHB or in the top quartile of DHBs. Given that no other DHB (or other organisation outside Canterbury) had gone through a decade of natural disasters beginning with earthquakes, this is an impressive performance.
CDHB was rated ‘Good’ for both ‘Management control environment’ and ‘Financial information systems and controls’ for each of the 2016-17, 2017-18 and 2018-19 financial years. For ‘Performance information and associated systems and controls’ CDHB was rated ‘Very Good’ for each of these same years.
The audit for the 2019-20 financial year is yet to be published but it appears that CDHB’s high ratings continue. This is reinforced by reliable accounts that Lester Levy tried to contest Audit NZ’s assessment; rather questionable behaviour.
Sadly the truth didn’t prevent the smear campaign from succeeding. Despite this success smearing still continues at a different level. Several in the health system continue to be shocked by the ongoing vindictiveness towards CDHB’s former senior management team displayed by a small number of senior Ministry officials when they visit their Molesworth Street headquarters and in other interactions, usually on unrelated matters.
I doubt that anything could contrast more with the intuitive compassion of health professionals than the dirty politics and smears that drove this scandal.
Here’s a link to the article: