Auckland Hospital kitchen workers tell CEO Ailsa Claire (far right) a week ago that they did not want to be contracted out. Such was the arrogance that no contingency plans were made in the event that these workers would be too upset to continue working when the announcement was made yesterday.
It isn’t just the jobs that will be lost when Auckland Hospital workers are contracted out to multi-national company Compass.
Nor is it just food quality and food safety that will be sacrificed when fresh food is replaced by pre-packaged, processed food coming into our hospital kitchens.
A big loser of the past week was democracy.
The Auckland DHB voted last Wednesday to go ahead with the HBL proposal to contract out its food services and outsource most food preparation to external suppliers.
On Friday, the Waitemata and Counties Manukau DHBs’ Chief Financial Officers also decided to go ahead with the proposal to replace food freshly cooked in the hospital kitchens with chilled food brought in from external suppliers. The CFOs had been delegated by the respective DHBs to make their supposedly independent decisions.
Hundreds of submissions were received opposing the proposals, including 164 individual submissions from hospital staff. Major concerns were expressed about loss of kitchen workers’ jobs, food safety, and the new nutritional food standards about to be imposed nationally.
When the decision was announced yesterday, the kitchen workers, ward assistants and café workers were so upset and angry that they walked off the job. Today most called in sick.
How did the National Government impose its ideological agenda of privatisation on three democratically elected Auckland DHBs in the face of such overwhelming opposition?
Former Health Minister Tony Ryall set up a Crown-owned company Health Benefits Ltd in June 2010 as a cost-cutting arm of the Treasury, targeting so-called non-clinical services of the country’s DHBs.
HBL claims to have saved $53 million in food services, according to the company’s Statement of Intent 2013/2014 – 2015/2016. That is quite remarkable given that not a single DHB has implemented any of its proposals.
They “saved” the DHBs all this money in “avoided capital expenditure”. That is especially galling as one of the arguments put to the Auckland DHB Board to contract out its food services was a lack of investment to replace ageing equipment.
We now know from leaked Cabinet papers that the National Government is planning to deliberately under-fund the nation’s DHBs. The DHBs need an extra $440 million in 2015/2016, but the Treasury has recommended giving them just $250 million – nearly $200 million short. In this environment, Health Benefits Ltd has been able to push through its agenda of cost cutting through privatisation.
HBL has two shareholders—the Minister of Health and Minister of Finance who appoint the directors. The Deputy Chair since HBL started is one Dr Lester Levy. He is the same Dr Lester Levy who is the Chair of the Auckland DHB. He is also the chair of the Waitemata DHB. In April 2014 he became a director of Orion Health, and in July, Waitemata DHB awarded Orion a three-year contract to develop new e-health systems at North Shore Hospital.
Levy is not alone in his interconnections. The DHBs are incestuous institutions through the appointment of Board members by the Government of the day.
Gwen Tepania-Palmer sits on both the Auckland and Waitemata DHBs, as does Morris Pita. Tony Norman, deputy chair of Waitemata DHB, chairs the Northland DHB and is a director of Health Alliance, which is owned by the four Northern DHBs.
Dr Lee Mathias chairs the Counties Manukau DHB and is deputy chair of the Auckland DHB. As with all of the above Board members, Mathias is an appointee of the National Government.
HBL has been working on reviews of food services and linen and laundry services since 2012. In April 2013 the company issued a confidential “Indicative Case for Change” for each of the reviews. The ICCs were virtually identical – it was as if they had cut and pasted “food” for “linen”.
By that stage HBL had decided on a single national provider for food services – UK firm Compass, which claims to be the World’s leading food services company and with Spotless dominates the New Zealand food services industry. Spotless is to get the hospital laundries.
Compass already has the contract for food services at Waitemata and Counties-Manukau DHBs. They have not been an exemplary employer. Workers describe their style as “management by chaos”. Changes in procedures are posted on equipment or on the walls of the hospital kitchen without consultation. Virtually all new workers are appointed as casuals.
HBL knows all this because union members have been telling them for the past 18 months. Yet this week all three Auckland DHBs agreed to give Compass a 15-year contract to run our hospital food services. The same proposal has now gone out to all 17 other DHBs around the country.
In the confidential business case given to ADHB Board members by HBL, there is one paragraph about the impact on staffing. It states, correctly, that all staff will be offered a transfer on their current terms and conditions to the contractor under the “vulnerable workers’ protections” of the Employment Relations Act.
But an independent review (also confidential) revealed that after the transfer, around one in five hospital kitchen workers in Auckland will lose their jobs. The DHB Board members were not told this.
Health Minister Jonathon Coleman scrapped HBL last week. HBL was a waste of money. Millions of dollars have been spent with little to show for it.
But getting rid of HBL does not mean the proposal to contract out all food services staff to Compass and outsource most hospital food, is off the table. All it means is that the DHBs are taking control of the implementation process through Health Alliance.
The Health Minister says the plans must go ahead to move funding from the “back room” to front-line services. But cooking food for hospital patients is not a “backroom” function. Food is medicine. And the workers at Auckland Hospital are a community of people dedicated to providing nutritious food for their patients.
Jill Ovens is an SFWU strategic industry leader for cleaners, catering and kitchen workers, laundry workers, security guards and school cleaners and caretakers. She became a union leader as an AUT journalism lecturer and later was elected ASTE National President.