NZ Unions Warn Private Sector Gets 80% of Public Health Funding Increase

Eighty percent of an increased $3 billion in public health funding over a three-year period went to the private sector, according to a healthcare worker unions’ report. The shift directed $2.4 billion into private hands, while publicly delivered healthcare through Health New Zealand and the Accident Compensation Corporation received an increase of $600 million, bringing public delivery from $14 billion to $14.6 billion in the same timeframe, rnz.co.nz reported.

Public Health Funding Flows Into Private Healthcare Providers

The report, produced by Public Futures Aotearoa—a coalition including the New Zealand Nurses Organisation, the Association of Salaried Medical Specialists, and the Public Service Association—alongside the Centre for International Corporate Tax Accountability and Research, utilized data from Health NZ and ACC. Findings show that the private sector received almost half of all public health spending at 46.4 percent in the 2024/25 period.

Report author and CICTAR researcher Edward Miller stated that the pace of healthcare privatization had accelerated sharply. “There was a $3 billion increase and 80 percent of that went to the private sector,” Miller told rnz.co.nz, adding that the growth in public delivery had effectively stalled while private delivery scaled up.

General practice emerged as one of the largest recipients of public funding. Public revenue accounted for 55 percent of general practice income, rising from below 50 percent over the prior two years. Estimates indicate that a quarter of all general practitioners were corporate-owned by 2026, marking an increase from 14 percent in 2022.

Private Hospitals and Specialized Care Services Expand Public Revenue Share

Private hospitals received over a billion dollars for publicly funded surgeries in 2024/25, representing a 93 percent growth in funding over the four years leading to 2025. Public funding accounted for an estimated 45 percent of private hospital revenue, with the report noting significant growth in funding for private hospitals for publicly funded surgeries.

Other healthcare sectors also relied heavily on public money. Diagnostics and imaging relied on public funding for approximately 65 percent of sector revenue, while aged residential care drew 76 percent, with portions of those funds flowing offshore to international owners.

Miller explained that the system increasingly relied on private delivery due to years of public underinvestment. He noted that internal advice from Health New Zealand showed outsourcing was more expensive than insourcing, and that public dollars built private capacity rather than public infrastructure.

Government and Health Authority Responses to Funding Distribution

A spokesperson for Health Minister Simeon Brown declined to respond to a report commissioned by unions that were actively campaigning for a change of government. However, background information regarding elective surgeries highlighted that Health NZ delivered 43,819 outsourced procedures in the 2025/26 period to treat patients who would otherwise face extended waits. Approximately 14,200 fewer people waited longer than four months for elective surgery compared to peak wait times, putting Health NZ 11.9 percent ahead of its Electives Boost target of 39,155 procedures.

Government health spending was projected to reach $34.2 billion in the 2026/27 financial year under the most recent Budget. A Health NZ spokesperson stated that the organization remained focused on using public funds responsibly to improve access to care and lift health outcomes, prioritizing maximum value and patient care regardless of the service provider.