GUEST BLOG: Ian Powell – When an academic gets it badly wrong over health crisis
As a history student at Canterbury University I did a paper on EP Thompson’s classic social history The Making of the English Working Class. First published in 1963 (I read a 1972 reprint) I was enthralled by it.
Reinforced by extensive empirical data, this was largely due to how it sharpened my understanding of ‘class’, specifically ‘working class’, as a relationship rather than a physical thing, occupation or job type.
Decades later, during my current month-long overseas trip, I’m rereading my well-thumbed 1972 reprint. It reminded me why I was so enthralled so many years ago and while it gave me so much pleasure.
However, with a troubling article published in Aotearoa New Zealand’s mainstream media on our health system in the back of my mind, it also reminded me of something else. That is, the importance of macro conclusions being consistent with micro-analysis and everyday experiences.
Thompson’s reminder
This reminder was Thompson’s invaluable discussion on how earlier historians had misinterpreted data on the incomes of artisans, labourers and weavers, primarily around the 1790s to the 1840s. This was due to their focus on average incomes only; that is, macro data.
But, in the context of these turbulent times, particularly the Napoleonic Wars (including its economic aftermath – inflation and unemployment) and technological changes, averages fudge the actual situation for many. So too was the misleading impression given by average percentage increases on low bases.
It was a period of old skills being replaced by new skills in the unfolding ‘industrial revolution’ and with much regional variation. Take weaving for example . For many decades it was the mainstay of English manufacturing. Weavers were a form of ‘labour aristocracy’.But this radically changed as the hand-loom was replaced by the power-loom.
Thompson did not confine his micro-analysis to incomes; he also applied it to mortality rates, particularly infants, and child labour.
The troubling article
The net result was that many more labourers, artisans and weavers suffered financial hardship, including impoverishment, than average incomes would suggest. It was this that struck me when reading the paywalled article published in the NZ Herald (11 November) by Peter Davis.
Emeritus Professor Peter Davis: a troubling article
Davis is Emeritus Professor of Population Health at Auckland University (also former elected member of the Auckland District Health Board and Chair of the Helen Clark Foundation): Peter Davis: what health crisis? .
Professor Davis opens with an assertion that:
Barely a day goes by without concerns loudly and forcefully expressed by advocates, health unions, lobby groups, and members of the public about the functioning of the health system.
In turn, these concerns are amplified by the media, such that we now apparently have a “health crisis” on our hands and the Minister of Health is then reviled for being loath to admit it.
His response to his own question, is there a health crisis is:
We simply don’t know – and we should. We should have objective, independent information available that would allow us to draw that judgment. But we don’t.
Davis justifies his conclusion by asserting:
…health funding has increased 40 per cent over the last five years, an increase I have never seen even close to being matched before in my near-half century academic career in health policy and health services research.
The five years Davis is referring to is from 1 July 2017 to 30 June 2022. Technically he is correct. But substantively he is misleading. He could learn much from EP Thompson on what is missed when one relies on macro data. It would not have taken much to have drilled down a little further by using Treasury data on Crown health spending.
Treasury and other information ignored
Treasury data covering the years from 2005 to 2021 (this includes the first four of the five years referred to by Peter Davis). From 2005 to 2009 health spending increased by relatively high percentages.
Then there was a huge downwards spiral in the level of increases. By 2017, when the Labour led government took office, there had been a small upwards movement since 2015 but well below the 2005-09 increases.
Treasury’s data is consistent with the separate Vote Health budget analyses of both the Labour Party in opposition and the Council of Trade Unions (collaboratively with the Association of Salaried Medical Specialists). These analyses revealed that in real terms over $1 billion had been sucked out of health system funding. From 2009 to 2017 health funding was hit by austerity.
New Zealand’s austerity was much less severe than that imposed in some other countries such as the United Kingdom, Spain, Ireland and Greece. But it was cumulative and had a big negative impact on our health system’s ability to do its job.
Treasury’s data is broadly consistent with the 40% claim of Professor Davis but only from 2017 onwards. Davis fails to recognise that this is a big percentage increase on a low base. This matters.
Further, he also ignores other important factors. On the funding side, a significant part of the 2022 budget health spend went on writing off large district health board (DHB) deficits. In no small part these deficits were due to the cumulative impact of the 2009-2017 austerity.
On the cost side, the health system throughout most of the 2010s and early 2020s was whacked by increasing demand for healthcare primarily due to increased poverty (social determinants of health).
This was most dramatically illustrated by acute hospital demand increasing at a higher rate than population growth. This also had a significant impact on DHB deficits.
Other misleading assertions
The simplistic use of macro funding data is not the only misleading assertion made by Davis. He makes a big thing of the fact that during his three years as a board member, Auckland DHB was “…never tempted to call our circumstances a health crisis.” One could be equally tempted to respond that this board was badly out-of-touch! But that would be point-scoring.
It was not just Auckland that didn’t use this ‘c’ word. Neither did the other 19 DHBs. This was because contrary to politically motivated mythology our health system based on DHBs was highly centralised albeit more covert than overt.
There was significant government control over DHBs including appointing their chairs and deputy chairs along with several board members, requiring them to implement its policies, and having the power to sack a board (replacing it with a government appointed commissioner).
In this context, no DHB chief executive wanting to retain their position would ever openly acknowledge that the health system was in crisis; no government would allow this. It would not be career enhancing.
Davis also goes on to assert that at Auckland DHB management “…had to get senior doctors to be present on the wards at weekends to make judgment calls on whether or not patients could be discharged…”
For goodness sake! In all DHBs there had been a steady move over many years towards specialists on after-hours weekend acute call to come into their hospital as a matter of routine to check on patients rather than wait until called.
This was not just about discharging patients. It improved the quality of patient care because nurses and resident doctors on site could be given proactive advice. This was an evolving practice which varied due to factors such as the usual acuity of patients in a service. Workforce capacity was also relevant.
From a personal experience, in the late 1990s I was discharged by a specialist at Wellington Hospital. This was in the weekend.
Health academics should learn from Thompson
Macro data is insufficient to make a call on whether New Zealand has a health system crisis. Micro analysis is also required but so is the everyday experiences of health professionals at the frontline of healthcare delivery. Unfortunately Davis’s published tone is suspicious of this latter voice.
Healthcare delivery is of necessity highly labour intensive. Consequently health system crises primarily arise out of severe workforce shortages. These shortages were prevalent before the pandemic and have been further worsened by both it and continued government neglect.
These shortages prevail across the health workforce from specialists to nurses to a range of other critical allied health professionals. This is what leave those working in the health system and those observing it to conclude that we have a workforce crisis in our health system.
This conclusion is based on what is currently happening daily (including denied and much delayed access to diagnosis and treatment along with workforce exhaustion). It is reinforced by data on the level of shortages, rising acute admissions, and historical health spending patterns,
One of the points made strongly by EP Thompson was increased child labour exploitation in England during the years of his study. Many earlier historians had downplayed the seriousness of this exploitation but Thompson dug deeper and found more. While obviously not as severe, one of the consequences of New Zealand’s health system crisis is an exploited workforce paying for it with their health.
Thompson was required to undertake a much greater and more complex data search than Professor Davis did for his troubling article. He should reconsider this.
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
This article is predicated on the basis that National governments should continue the expenditure track of Labour governments. That is, the National government of 2008 to 2017 should have increased public expenditure in the same manner as the Clark government. However by 2008 it was clear that the Clark government’s expenditure track was going to lead to permanent deficits, “the decade of deficits”. What would be the point of changing governments if nothing changed?
On top of that, the GFC happened, along with the Christchurch earthquake. Both these events meant previous spending plans, even of the incoming National government, had to be pruned back. It wasn’t until 2013/2014 that a surplus was achieved, and with it, increased spending.
So Peter Davis is only wrong if you make the assumption that the Key government should have spent at exactly the same rate as the Clark government had planned to do so.
I would note we now seem to back into long term deficits under the present government. Yes, Covid is part of the reason, but Treasury documents show that with the current government there won’t be a surplus during this decade. Eight years after the Covid measures ended.
Part of the effect of that will be ongoing inflation and high interest rates. Both things are hard on those trying to get ahead, to get their first house.
So, if there is a change of government, there won’t be a continuation of Labours spending plans. The rate of increase of spending will be less under a National led government. Not an actual reduction, but more modest and more targeted increases.
“What would be the point of changing governments if nothing changed?”
We couldn’t possibly have a change in government just because the pleb electorate wanted a change eh?
After all, the majority of those lesser people don’t know anything. They need the guidance and leadership of superior beings such as yourself @Wayne. They just don’t understand
Ian, no comment on Health spending, but as a history student at Canterbury in the Jurassic I too read EPThompson. There are on my shelves still Bautier on medieval economy, Carr on the Russian revolution, Hobsbawm, Shirer, etc. My still most thumbed is AJP Taylor Course of German History. All still illuminating.
Problem for the academics are that they never front at the pointy end of the health system where said system meets the consumer.
Which of them ask where the increased spending is targeted. Certainly not at ED care, certainly not on mental health, certainly not on the new Dunedin hospital.
https://www.stuff.co.nz/national/health/130327872/cuts-to-dunedin-hospital-project-pose-reputational-operational-and-clinical-risk
If the increase in Health budget allocation has gone to restructure and the re-employ of more “managers” than it is a waste of Peter Davis time to comment. Instead he should spent a month or more at Middlemore ED and just come up with better ideas where to spend this “extra” funding.
He just reinforces the notion that academics are like politicians, totally oblivious of to problems where state service systems meet the consumer. Ivory Tower intellectuals safely ensconced with their fat salaries and latte’s in the fairy kingdom of theory. Whilst the plebs suffer declining health care but work to pay the taxes so Peter Davis can swan around in his ivory tower.
Despise is not to strong a word for the contempt I have for academic twits.
The first thing I did after reading this was to search for a chart of health expenditure over time. It’s here: https://figure.nz/chart/c77PxswJK8z1pA2u
As you can see, while not exactly linear, there has been a steady and steep increase in health expenditure per capita from $1338 in 1997 to $4464 in 2021, with much of this occurring during a period of record low inflation. Thus, neither party can be accused of trimming the health budget.
So, I think that in order to get to grips with the current situation we need to understand the broader social and economic context:
> The Boomers are getting to age when their health fails so there is a bulge in admissions and consequential costs due to demographics.
> Medicine has seen a dramatic expansion in the availability of procedures and drugs due to investment in R&D. The result is that conditions that were previously either inoperable or incurable are now treatable…at great cost.
> Socialized medical services have a reputation of being financial black holes. It’s one thing to pour money in at the top but it’s another thing entirely to ensure that the money trickles down to those actually delivering the service at the bottom. The current government removed performance measures in their laughable ‘wellbeing’ budget. Maybe that wasn’t such a great idea? A new government in 2023 must undertake an urgent assessment of where exactly the cash is going, because it seems it’s not going where it’s needed.
You could add that we have had a massive influx of new migrants, many with complex and often unidentified health needs and many will never contribute more than they take out – in fact many will never contribute full stop.
Granted a number of new arrivals do actually work in medicine but increasing money pumped into the health sector just isn’t keeping up with increasing demand for the reasons you have mentioned and because of increasing population and changing demographics.
Have you been to a hospital recently Daniel? Because they’re staffed with the children of immigrant Indians, Pakistanis, Afghanis etc. Without them we’d be lost! All immigrants have to pass a medical before they’re admitted to this country, so I suspect their health is better than the average New Zealander.
So maybe you should go easy on the Xenophobia?
Well said Andrew.
I agree with Andrew. The big cost are people living longer into old age. Someone should run a model that shows increase in costs, per increase in year of life expectancy.
This group would have range of health issues that range from orthopedics, organs wear & tear, brain disorders, palliative care etc etc.
Secondly, as more treatments/investigative techniques are discovered, higher the costs.
Third, Maori and Pacifica also present late, hence diabetes that could be controlled by drugs in early stages becomes dialysis and amputations. Same with cancers, earlier the discovery, better the outcome and lower the costs.
Daniel, I am not certain if blaming migrants is appropriate in this case. Most migrants coming on work or business Visa are relatively young in age, and on average they will not have influx of complex or unidentified needs. They also go through intensive medical examinations before given residency.
One of the biggest issues is so many people in politics and advising them, think that the amount of money is equal to a good result. One of the biggest problems with Labour is that they love to throw money around everywhere but it often has a negative effect as it’s being siphoned off with disinformation galore or going nowhere, and they then virtue signal how much money they spent.
From banking incompetence
“The Reserve Bank created the money, gave it to the banks, and now must pay interest on it to the banks. This is voodoo economics which will cost the Reserve Bank about $2 billion in interest this year.”
https://thedailyblog.co.nz/2022/12/05/signs-a-housing-crash-is-coming/
Cost of Living Payment paid to people on working holidays who have left NZ
https://www.stuff.co.nz/business/129491190/cost-of-living-payment-paid-to-people-on-working-holidays-who-have-left-nz
To costly consultants everywhere – pushing more and more into the government ministries at the same rate as bad results keep occurring.
Splash the cash: Private Three Waters consultants paid $16m
https://www.newstalkzb.co.nz/news/splash-the-cash-private-three-waters-consultants-paid-16m/
Revealed: Kāinga Ora spent over $24m of taxpayer money in four years on its own office renovations
https://www.msn.com/en-nz/news/national/revealed-kāinga-ora-spent-over-24m-of-taxpayer-money-in-four-years-on-its-own-office-renovations/ar-AAUZXtc
not mentioning the polytech merger, the health merger, more committees everywhere, notice that OT can’t manage to save the NZ kids whose mum is in prison but resources to investigate Chinese circus children and get something done! Seems like government priorities are not really on helping Kiwis anymore in NZ.
Just look at immigration, more interested in propping up scams and cash labour aka entire families being able to come and live in NZ on the back of a $43k job or study visa – no need to speak English, all the better for exploitation! Oh I wonder after years of this, why NZ now has poverty and crime out of control when all government focus seems to be external and propping up harmful industries like smoking (available at your local overpriced dairy!). So helpful to the health industry just like the junk food industry and having so many people who are not NZ citizens able to access the NZ health system!
With a $43k job then it is minimum wage, https://www.stuff.co.nz/business/money/300519291/minimum-wage-workers-pushed-near-middle-tax-bracket, hard to work out why this is so much of a government priority to keep so many workers coming into NZ on wages at that level – note apparently a family of 4 will require $7k in other taxpayer top ups in NZ so they are creating more demand for welfare at the same time – if they don’t qualify they keep complaining with the woke backing them up, until they do qualify, in the mean time charities pick up the slack, also government paid in many cases.
Thank goodness for your perceptive eye savenz. It is interesting how the evidence keeps popping up like strong weeds in the lawn but often aren’t noted or fixed in memory.
I have a compulsion to read Catherine Cookson fixed around poorer times in the Industrial Revolution mainly and full of class consciousness and revealing how fixed beliefs and practices get within the different classes, and explains whole families working in the mines, crawling in narrow low tunnels half naked because of the heat and the lack of clean, unripped clothes because of the coal grime. And the role of doctors and the medical profession in easing life for the poor, and sometimes doing heroic efforts to improve situations of illness, where pockets show there is a need.
John Snow and the Broad Street Pump UCLA ·
https://www.ph.ucla.edu › snowcricketarticle
British doctor John Snow couldn’t convince other doctors and scientists that cholera, a deadly disease, was spread when people drank contaminated water …
NZ
Smith, George Marshall McCall (Dr), 1882-1958 (originally Scottish)
National Library of New Zealand ·
https://natlib.govt.nz › tap…
Lived and worked at Rawene from 1914 to 1948. Instituted a community health plan which covered the Hokianga. Pioneer in social medicine. See DNZB (Vol 4, …
Missing: trailblazer | Must include: trailblazer
and
https://en.wikipedia.org/wiki/George_Marshall_McCall_Smith
Dr Smith was determined in his efforts to gain good medical services: In 1925 the Health Department approved the plans for a new hospital and Smith raised money from the community to furnish and equip it. To raise funds he implemented an unofficial ‘hut tax’ over every dwelling in the county, ran an illegal casino in Rawene and an illegal raffle.[17][18] The new hospital was built on time and within budget and was opened by the Minister of Health in March 1928.
We don’t get that dedication to poor and needy patients with single-mindedness from the PPP arrangements and full private enterprise !
Question, can anyone tell me the actual cost of setting up Health NZ. I don’t mean the paying down of debt from the DHBs