Margie Apa: Health NZ CEO on the $934 million deficit for the financial year

The Health New Zealand leader says their cost growth has plateaued.  

Its report for the June quarter shows the preliminary result for the financial year is a $934 million deficit.  

Earlier, in quarter three, a $299 million surplus was forecast.  

Chief Executive Margie Apa told Heather du Plessis-Allan they've stopped their cost growth and have stabilised in the past quarter.  

She says they need to take out costs and balance that with delivering on targets, using the core workforce they have. 

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Episode Transcript

Speaker 1 (00:00):
It's the dire state of House New Zealand's books has
been laid there. It turns out the deficit is near
a billion dollars and that is worse than expecting with
us now is House New Zealand's chief executive Margi Upper Hey, Marjie, Oh,
good morning. How did you guys go from expecting a
surplus of about five hundred million bucks in March to
then a deficit of nearly a billion dollars in June?

Speaker 2 (00:21):
Probably three key drivers a comment on Heather. We certainly
recruited a head of budget, so we have ended the
year with over our four thousand more clinical staff of
which half a wound and budget. We did have some
one off that landed in Q four which on reflection,
we really should have smoothed junior year, which would have

(00:43):
made our monthly financial show that we weren't as in
as positive a position as we were, and we have
made different decisions and of timing the we got. We
ended a period of gene still and yet about four
hundred and nineteen million pay investment which has been received.
We've gotten that last week. The mystery for.

Speaker 1 (01:08):
So if we take take out the one offs, take
out their pay equity and take out the staff that
you recruited early. Does that mean that next year, next
financial year, the one that we're in at the moment,
we won't have a deficit.

Speaker 2 (01:22):
We're working to try to get back to budget, but
we don't want to. You know, we've got good clinical
staff and place, so we want to make sure that
we're getting really big value out of the time of
our clinical frontline people and in particular achieving targets because
that's that's the big delivery priority for Health New Zealands
to meet those short weight times.

Speaker 1 (01:42):
That doesn't sound like you were super confident you're going
to be able to get back into surplus.

Speaker 2 (01:47):
We're we're tattoed. So we've managed to stop our cost growth,
particularly in this past quarter, so we're tatitle stabilized in
this quarter. The rest of the year, we do need
to take out some costs. We've got to also balance
that with making sure we deliver on the targets and
use the kind of call workforce that we've gone.

Speaker 1 (02:06):
Madia, you guys still losing more than one hundred million
bucks a month.

Speaker 2 (02:11):
We're spending at a rate of more than one hundred
million a month. Yes, and there's some that hasn't changed
the initiatives we've got underway. It's plateaued over the last
this quarter.

Speaker 1 (02:20):
Okay, so yeah, okay, so it was growing beforehand, it's
now not growing now, it's just sitting at that level.
But you've got to bring that down, don't you.

Speaker 2 (02:28):
Yes, yes, we need to reduce our call all right
here on the.

Speaker 1 (02:30):
Bright side on the targets, you have managed to hit
four of the five targets now not by a lot, right,
So is that just because it's over only a three
month period. It'll just keep keep adding all the little
increments together and at the end of the year looks bigger.

Speaker 2 (02:43):
Yeah. And we also Q four is also our winter season,
so we do tend to see it's a passion of
not seeing the kind of growth improvement over this period
and there'll be a little bit of the pertectay over
the July August. Yeah, we're still seeing some winter volume
through yes hospitals in particular.

Speaker 1 (03:01):
Okay, Margie, thanks very much, appreciate. Maggie upper Health New
Zealand Chief Executive. For more from the Mic Asking Breakfast,
listen live to news Talks it' B from six am
weekdays or follow the podcast on iHeartRadio,