16 May 2014

Spin hides massive budget cuts to health and education

Government spin that the budget is “family friendly” is a smokescreen for the fact health and education have been savaged and the elderly and children will suffer as a result, the Green Party says.

Analysis by the Parliamentary Library backs Green Party claims yesterday that, using the Government’s own forecasts, annual funding for Vote Health will be cut by more than $1 billion in real terms by 2017/18 compared to 2013/14.

Annual funding to Vote Education will be cut by $500 million in real terms in 2017/18. This uses the inflation projections in the Budget. Though the real cuts in health are likely to be higher due to pressures from an aging and growing population and the fact health inflation tends to outstrip general inflation.

“Government spin that its throwing around loads of “new money” ignores the fact that additional funding is always needed to meet the costs of inflation. Our analysis, backed by the Parliament Library, shows that, when inflation is taken into consideration, health and education are the big losers in the budget.

“For those on the ground, that means a funding cut. Hospitals will be under even more pressure to cut services and hire fewer staff, and early childhood centres and schools will need to call on parents to make up funding shortfalls.

“DHBs for example, needed an additional $399 million in dedicated funding next year just to maintain the current levels of service, according to analysis by CTU economist Bill Rosenberg. With the budget providing only an additional $299 million, that leaves a shortfall of $100 million.

“That will put even more pressure on hospitals which are experiencing growing service demands from an aging and growing population and new treatments and services.

“On Planet Key inflation may not exist, populations might not increase, and people may not age, but in the real world they do.

“The Health Budget also includes a $500m one-off debt refinancing, which may mean even more pressure on health services this coming year.

“Free doctors visits for young children are desperately needed by families, but it’s hard to see in the broader picture where the Government is getting the money to fund them. Something’s got to give.

“As for education, per child revenue to early childhood centres has effectively been cut, by funding that fails to keep pace with inflation. Centres are already saying parents will be asked to pay more as a result.

“People won’t be fooled by the Government’s spin. When surgery waiting lists grow, hospitals and school buildings continue to fall apart because it costs too much to repair them, and early childhood fees increase, it’ll be blatantly obvious whose back this Government has. And its not everyday kiwis’,” Dr Norman said.

Link to document showing Budget 2014/15 Health and Education funding in real terms: www.greens.org.nz/sites/default/files/budget_in_real_terms.xlsx

ENDS

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