King Annette: Questions for Oral Answer — Questions to MinistersText is incorporated into the Bound VolumeKing Annette: Questions for Oral Answer — Questions to Ministers[Sitting date: 18 June 2014. Volume:699;Page:18615. Text is incorporated into the Bound Volume.]7.Hon ANNETTE KING (Labour—Rongotai)to the Minister of Health: What concerns if any has he expressed regarding the progress Health Benefits Ltd has made towards obtaining the $700 million of “savings” which he required them to obtain in September 2012?Hon TONY RYALL (Minister of Health):I have expressed the view to district health boards as to the importance of working collaboratively to harness the power of bulk purchasing and standardisation to free up resources to invest in more front-line services for patients. By way of example by working together the district health boards are expecting to save up to $16 million this year on banking and insurance costs and $34 million this year on regional shared-service initiatives. The estimate is that by the end of this financial year we will have saved around $300 million which is in addition to some other district health board savings.Hon Annette King: Is he aware that as recently as 2 months ago Health Benefits Ltd signalled to district health boards cost escalation and potential delays of at least 1 and up to 2 years in the implementation of his flagship finance procurement and supply chain programme; if so what impact will this have on the $700 million saving he requires health bosses to make?Hon TONY RYALL: On the finance procurement supply chain issue the latest set of data that I have looked at is that we are running below the budgeted cost. It is now operating on the national platform at Hutt Valley District Health Board. But I have got to say that implementation is always an area of risk and it has certainly been my message to the board of Health Benefits Ltd to make sure that a lot of emphasis goes into the implementation because if we are to generate the savings that we need to put straight back into the health service then implementation has to be a very strong focus.Hon Annette King: Has he been informed that profound concern has been expressed at the mounting risk to the delivery of health services because of Health Benefits Ltd’s lack of transparent and timely information lack of accountability for decision making lack of timely communication and the absence of a credible implementation plan?Hon TONY RYALL: With change always comes worry for people because they have uncertainty about their jobs. I am very aware that people are worried about some of these proposals but people need to keep their eye on the real gains here and the gains are that by working more effectively together district health boards can make significant financial savings and those resources can go back into supporting improved front-line services together with the average $500 million a year extra that this Government has put into the health service.Hon Annette King: Would he be taking action if all chief financial officers of district health boards said they had grave and collective concerns about his flagship Health Benefits Ltd programme its cost escalations implementation delays benefit erosion and escalating risk profile; if not why not?Hon TONY RYALL: I have been really quite keen that chief financial officers were taking an active interest in the implementation of these programmes because they are very important and very significant. Some parts of the programme are moving ahead and ahead of budget and others are going a little bit slower because of the implementation risk. Overall we are going to be freeing up hundreds of millions of dollars over time for district health boards and all that goes into improving front-line services. As you have seen already with the insurance and banking and other initiatives that is money that we can save that goes into more care for patients.Hon Annette King: What is the cost of funding the growing empire of Health Benefits Ltd which now occupies four floors across two buildings in Central Park Auckland while at the same time district health boards are struggling to retain staff because of the uncertainty of Health Benefits Ltd’s programme leading to significant risks in continuing current services?Hon TONY RYALL: I do not think there is any risk to the continuing of front-line services in our district health boards. This Government has put an average of $500 million a year extra into the health service. But it is not just about money; those extra services are benefiting from the improved productivity that we are seeing where we have 40000 more New Zealanders a year getting hips knees and other elective procedures than when that party opposite left Government.Hon Annette King: I seek leave to table a letter from all chief financial officers of district health boards saying there was uncertainty leading to significant risk in continuing current services that there is profound concern—Mr SPEAKER: Order! The member will resume her seat. The document has been described. It is a letter signed by all chief financial officers. Leave is sought to table that document. Is there any objection? There is none. It can be tabled.Document by leave laid on the Table of the House.