GUEST BLOG: Ian Powell – Predictable smear of salaried senior doctors

During my lengthy stint as Executive Director of the Association of Salaried Medical Specialists (ASMS) one of my most important functions was to negotiate the collective agreements covering salaried senior doctors and dentists employed in public hospitals.

From 1989 to 1991 these were national negotiations; until 2000 negotiations were conducted separately with each main public hospital; and then, until 2019, they were national again with all the district health boards.

On occasions these negotiations were protracted and somewhat tetchy (or tetchy plus!). It became quite predictable that, when this occurred, at some point the employers would engage in a public misrepresentation or smear in an endeavour to undermine our credibility.

To the best of my recollection these public actions never came from health ministers (a few private grumblings notwithstanding) or bloggers (although I can’t dismiss the possibility that far-right blogger Cameron Slater didn’t hold back; he didn’t towards me on other issues).

Simeon Brown broke the practice of health ministers not making public attacks

Health Minister Simeon Brown broke the practice with his public attack on ASMS over the recent senior doctors one day strike.

This was caused by the impasse in negotiations over the national collective agreement with Health New Zealand. He began by badly misrepresenting basic salary levels.

He also claimed that the strike was causing delayed access to planned (elective) surgery. This was more than a tad rich. Under his leadership and that of his predecessors, access was already being increasingly delayed every other day of each year.

Joining in on misrepresentation and smearing

Now right-wing blogger David Farrar has jumped in support of Brown with his own smear on his Kiwiblog site (7 May): Perks smear. He alleges that salaried senior doctors employed by Health New Zealand and the Ministry of Health received “huge perks”.

It is important to understand what perks are (and what they are not). They are additional benefits to enhance the employment package such as health insurance or a company car. They don’t involve reimbursement of actual and reasonable work-related expenses.

Right-wing blogger David Farrar uses fake claims to  misrepresent and smear

The problem with Farrar’s argument is that it is based on major errors and sloppy homework. This is not new territory for him.

I have previously called him out (11 December) for erroneous claims about resident (junior) doctors leaving for Australia: Farrar’s incomplete health workforce analysis.

Farrar’s hearsay evidence

On this second occasion his evidence is based on a reader writing to him claiming that salaried senior doctors employed by:

… Health NZ and the Ministry of Health get generous leave and expenses for so-called professional development – which is often an overseas conference in an exotic location – flying business class and staying in a premium hotel. I have this on good authority from someone who processes the claims! This leave and generous allowance which can accumulated for two or more years.

This is hardly robust investigation. At best it is hearsay. To begin with, Health Ministry employed senior doctors are not covered by the collective agreement covering Health New Zealand employed senior doctors.

Farrar is discussing something that applies to the latter, not the former. Further, claims to the two different employers would not be processed by the same person

By referring only to one part of the entitlement and then incorrectly calling it an allowance, he is both selective and factually wrong.

Getting to the facts

I was the advocate who first negotiated the continuing medical education entitlement

The entitlement (I was the advocate who first negotiated it) is spelt out in Clause 36.2 of the national agreement. Its first subclause (a) begins with:

The employer [Health New Zealand] requires employees [senior doctors and dentists] to be fully informed, and where possible, practised in developments within their profession. To facilitate this, employees will be entitled to leave for 10 working days (pro rata for part-time employees) continuing medical education each financial year (1 July – 30 June), plus any agreed reasonable travelling time.

This is what Farrar ignores. Continuing medical education (CME) leave is something the employer requires of this particular occupational group. This is in order to help ensure that they can perform their duties and responsibilities to the level of competence, quality and patient safety required.

The rest of sub-clause covers administrative matters, including accruals. Farrar’s focus is primarily on the next sub-clause (b). He does not ignore it. Instead, he gets it badly wrong. The sub-clause reads:

Employees shall be reimbursed actual and reasonable expenses of up to $16,000 per annum (GST exclusive) and accumulated on the same basis as the working days (a) above. This reimbursement is pro-rata for part-time employees except that part-time employees whose only income from medical or dental practice is derived from their employment with one employer shall be entitled to the full reimbursement.

The fundamental distortion (or mistake if one is in a generous frame of mind) by Farrar is to call the monetary amount an allowance. It is not. It is a capped reimbursement of work-related expenses.

Furthermore, it is not an absolute $16,000. It is up to this amount subject to claims being actual and reasonable.

The specification of a specific dollar amount serves the interests of both employer and employees even though, for the latter, it is capped (potentially it could cost Health New Zealand more if there was no cap). However, the cap better enables planning and budgeting for both parties.

While use of the leave and associated reimbursements is often used for medical or dental conferences, they have to be relevant to duties and responsibilities. Further, it can also be for other approved options such as working at another location or study.

Fringe benefits tax sideshow

Farrar’s distortion (or mistake) leads him to then argue that the fringe benefits tax must apply and has to be paid by Health New Zealand. Somehow, he estimates the total additional cost to be least $23,880 (presumably per annum).

But it does not attract this tax because the entitlement is not an allowance. Perks apply to allowances, not work-related reimbursements. Much of the CME expenses are spent on consumables such as travel and accommodation. Where conferences are involved there also registration costs.

While some of these costs are close to home (Australia), our relative geographic isolation means that greater distances are required to exercise the full benefits of this necessary form of professional development and education.

The one exception where the fringe benefits tax might impact (it might instead be PAYE) is that the entitlement can be used for the personal purchase of laptops (that is, a personal capital product) for the express purpose of professional development and education. However, this requires specific employer approval and, to the extent that it happens is only a small component of the costs of the entitlement.

Farrar goes further to falsely imply that the two weeks CME itself, which is required by Health New Zealand, is also a perk.

Let me be very clear. Based on my experience in the health system, I would not want to be treated or diagnosed by a senior doctor who was not sufficiently utilising their CME leave entitlement. Patient safety has been compromised as a consequence.

Sloppy mistakes or deliberate distortion?

Finally, Farrar proceeds to make an astonishing attack on the credibility of senior doctors. He refers to something he had “heard” (further hearsay). One employed by the health ministry had allegedly used the “allowance” to a global conference on air pollution and health.

First, the entitlement is for Health New Zealand employed senior doctors. Second, if the person nevertheless was able to receive the same provision, it is not an allowance.

Third, a health ministry employed senior doctor able to attend this event is most likely to be a public health specialist.

If so, giving the relationship between air pollution and poor health, it would be up there among the most valuable events to attend if the health ministry were to properly perform its stewardship role for the health of New Zealand’s population.

Is David Farrar’s smear due to sloppy mistakes or deliberate? Readers can be the judge of that.

 

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