GUEST BLOG: Ian Powell – Blending false narratives with scapegoating; think pots, kettles and black!

In my previous post of Otaihanga Second Opinion I discussed the role of false narratives in Aotearoa New Zealand’s health system: False narrative of frontline services not depending on ‘back office’ functions.

Another negative role for the disingenuous in health systems is scapegoating people or organisations for things that they have not done. Instead someone or something else has committed the wrong.

When blended with a false narrative this scapegoating involves not only falsely blaming people for bad things; it can also mean alleging things that didn’t happen in the first place.

Learning from the Commissioner

Newly appointed Commissioner Lester Levy, following the Government’s disestablishment of the Board of Health New Zealand (Te Whatu Ora), has much to offer in understanding this blending through his previous involvement in four different district health boards (DHBs) beginning in 2009.

Commissioner Levy: much to learn from

I discussed three of these DHBs in my Newsroom opinion piece published on 26 July:  Leadership scapegoating.

Levy was appointed by the Minister of Health, first Tony Ryall and then Jonathan Coleman, as the overlapping chair of the three Auckland DHBs – Waitematā from June 2009,  Auckland from December 2010, and Counties Manukau from November 2016.

In each case he claimed that the DHB was in a right mess and he would be the solution. This included, over time, being critical of financial performance.

In terms of the provision of healthcare to their respective populations, which is what counts the most, all three DHBs were well-functioning despite the incremental impact of relative underfunding (protracted ‘light austerity’) from 2009 onwards.

At the time of each of his three arrivals, all the DHBs had healthy fiscal surpluses. In particular, Counties Manukau’s financial performance as a DHB had been top rated by Treasury before his arrival.

However, immediately following his departures they all had serious deficits along with declining workforce morale.

Although it might appear so, however, Lester Levy was not responsible for these deficits. By then almost all DHBs were in deficit. As I commented in the above-mentioned Newsroom article:

With the exception of Canterbury (whose high deficit was due to the disastrous response of the health ministry to the post-earthquakes rebuild in Christchurch), all these deficits had a common cause.

That common cause was the continued failure to fund public hospitals, in particular, in a way that covered increased cost pressures which the health system itself could not control. At best, with the right organisational culture, it could mitigate.

These cost pressures were largely driven by the impact of increasing acute demand which was increasing at a faster rate than population growth.

Increasing acute demand, in turn, was primarily driven by worsening external social determinants of health such as low incomes and poor housing which DHBs had no control over.

However, while Levy can rightly claim not to be responsible for these deficits that occurred under his watch, this didn’t prevent him from using false narratives to scapegoat others. This, along with arbitrary decision-making, contributed to declining morale.

And then Canterbury

Then came Canterbury DHB. It had been internationally recognised for its innovative approach to health professional engagement. This included its world-leading health pathways between community & hospital care.

One of the successes was bending the curve of increasing acute demand and consequently avoiding deficits until impact of the primarily Health Ministry excessively delayed post-earthquake rebuilds.

Had these Health Ministry driven delays not occurred, then Canterbury was tracking to have no deficits at all. Like Counties Manukau, it had also been top rated by Treasury for financial management.

Former health minister David Clark: principled but gullible

However, then Health Minister David Clark appointed Levy Crown Monitor in 2019. Clark was an intelligent and principled health minister but his gullibility enabled him to be used for other agendas.

As crown monitor Levy played a central role, along with EY consultants and senior health ministry officials, in claiming that Canterbury’s deficits were driven instead by financial mismanagement.  Specifically the DHB had employed too many nurses!

The resignations of the chief executive and senior leadership team were the inevitable consequence of this false narrative based scapegoating. Workforce morale in the DHB unsurprisingly collapsed.

Fast-forward to contemporary scapegoating

Fast-forward to June 2024, and Lester Levy first becomes the new Chair of Health New Zealand quickly followed by the disestablishment of his Board and his appointment to the newly created position of Commissioner.

Sharing the same song sheet with Prime Minister Chris Luxon, it began with scapegoating the former Board members and re-demonising those staff involved in support roles (back-office) critical for the work of frontline health professionals. I discussed this in an earlier post (27 August): Luxon-Levy duet.

Newsroom exposure of latest Health NZ scapegoat

But now the Chief Finance Officer of Health New Zealand has become the latest scapegoat. This was exposed in an excellent article by Newsroom Managing Editor Jonathan Milne (11 September): Scapegoating chief finance officer for deficit.

Rosalie Hughes: scapegoated chief finance officer

He reported the dramatic ousting from this role of Rosalie Hughes (previously Percival). Although it was Margie Apa who had reported to her senior management team Hughes’ ouster nearly six weeks before Milne’s exposure was published, it was the establishment of the Commissioner position that was behind it.

However, to her credit, it is clear that Hughes isn’t a pushover. While she has wisely not commented publicly, she still on the payroll under the often used label of transitioning out, ‘special projects’ for 12 weeks.

But this has all the hallmarks of a formal employment relations dispute likely to take its own course. Health New Zealand as the employer will have the onus on it to justify the ouster.

The only response, when approached by Newsroom, of the Commissioner has, perhaps unintentionally, been to reinforce the prevalent view that this is an employment dispute.

In his words: “We aren’t able to make comments as we do not comment on individual employment matters.”

Commendable reputation

What is not in doubt is Rosalie Hughes’ credible reputation as a chief finance officer, including among former colleagues. Both former Te Whatu Ora Chair Rob Campbell and I (as a health commentator) are also quoted by Milne affirming this assessment.

Ironically Hughes had been publicly praised the previous year by Chief Executive Margie Apa for receiving New Zealand’s Chief Finance Officer of the Year Business Award.

Chief Executive Margie Apa highly praised the subsequently ousted chief finance officer

Milne reports the judges at the time as acknowledging:

…her quiet and calm approach to what had been the biggest merger in New Zealand’s history. They said they were inspired by her passion and compassion for her team and the New Zealanders they served.

He also reports, in her words, the high public praise for this award by Margie Apa:

The merger of 29 entities to form Te Whatu Ora was and is a mammoth task that we would not be where we are, were it not for our finance team under Rosalie’s leadership.

Their work gives us the confidence to make the shifts – including improved decision making – so we can reprioritise and support more front-line delivery of care to New Zealanders.

Unique health system finance background

It is not just this prestigious award that defines her credibility and respect, however. Her unique experience in this role at a DHB level was unsurpassed made her a logical choice to be appointed to the national role by Margie Apa.

Specifically, for well over a decade, she acquired three different unique experiences in four different DHBs as a chief finance officer:

1. Waitematā provided the challenge under the population based funding formula of a large DHB with the fastest population growth.
2. Auckland provided a quite different challenge. Owing to its high level of tertiary subspecialist services, in the vicinity of 40% of its funding came from other DHBs who referred their patients to Auckland. This was called inter-district flows. Other large DHBs had them but not on this scale.
3. Capital & Coast and Hutt Valley DHBs had their own uniqueness as large and medium-sized DHBs. Hughes was the chief finance officer for both.

Following publication of the above-mentioned Jonathan Milne’s exposure I posted the link on LinkedIn. This led to over 6,000 ‘impressions’ including a number reposts and unsolicited comments.

All comments were complimentary about the scapegoated Hughes but two are particularly relevant to this post. One is from Dr Martin Orr, senior psychiatrist and currently clinical director at Auckland University.

He had previously worked at Waitemata DHB where he had much to do with her, including in the interconnected field of information technology. In Dr Orr’s words:

If any of this [Milne article] is true I hope there is someone in there , who can speak truth to power. As highlighted in the article , Rosalie won top CFO and has her job for a reason . Throughout her career she has been highly respected by managers and clinicians alike. She is highly competent , hardworking , compassionate and usually the wisest person in the room . Any attempt to scapegoat Rosalie would just be wrong on so many levels.

Tracey Maisey: Rosalie Hughes highly respected and competent

The second was from Tracey Maisey, Chief Executive Northern New South Wales Local Health District. In her words:

Rosalie is a highly respected, competent CFO who was trying to do the impossible – merge 26 entities disparate financial systems in 18 months, and try to make sense of what came out of their reporting systems in the meantime. Very sad to hear this news.

Pot calling kettle black

Rachel Thomas: A second Health NZ exposure

Not many journalist exposures could trump Jonathan Milne’s. But, if not trumping it, coming close exactly a week later was on-the-mark Stuff health journalist Rachel Thomas.

On 18 September The Post published her paywalled article revealing that Commissioner Lester Levy was effectively being paid a full-time salary for a part-time position: Commissioner holding down two jobs.

In summary, Thomas reports that Levy is paid as much as $320,000 as Commissioner to ‘fix’ the health system while holding a second job (a university teaching position) for two days a week. She also reports the distress of clinical staff on learning of this revelation.

Pot calling the kettle black

From my perspective, words like pots, kettles and black come to mind,

 

Ian Powell was Executive Director of the Association of Salaried Medical Specialists, the professional union representing senior doctors and dentists in New Zealand, for over 30 years, until December 2019. He is now a health systems, labour market, and political commentator living in the small river estuary community of Otaihanga (the place by the tide). First published at Otaihanga Second Opinion