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Delivering a Strong Health System for Our Future

Thu 17 May 2012

Michelle O'Byrne

Minister for Health

The Minister for Health, Michelle O'Byrne, said the savings target for the Department of Health and Human Services has been reduced by $120 million over the next four years.

Ms O'Byrne said the Tasmanian Government had exempted health from the need to find further savings and delivered an effective budget increase of $27.3 million in 2012-13, increasing to $33.1 million in 2013-14.

"These past 12 months have been incredibly challenging in health," she said.

"We have had to make some difficult decisions to ensure our health system remained strong in the face of rising costs and falling revenue.

"Staff throughout the health service have worked incredibly hard to deliver savings while minimising the impact on patients as much as possible although we could not avoid impacting patients completely.

"Increasing the savings requirement would have unduly affected our critical health services, something this Government is not prepared to do.

"Today's State Budget recognises the heavy financial load still to be carried by our hospitals and has allocated $120 million in savings relief over four years.

"Our health services now have the chance to consolidate the $100 million in savings already identified.

"We are also providing $4 million this financial year to increase the number of endoscopy and elective procedures performed."

Ms O'Byrne said efficiency and effectiveness will be vital from 1 July when Tasmania implements National Health Reforms.

"The need to control rising health costs and ensure every dollar we spend achieves maximum benefit remains critically important as we move to an activity-based funding model.

"The budget supports the transition with Commonwealth funding of $63.1 million over four years from 2010-11 to achieve improvements in public hospital care.

"A total of $42 million remains to be spent over the forward estimates.

"This funding will help more patients get elective surgery, help deliver a new four-hour national target for emergency department care and deliver and operate new sub-acute beds."

Ms O'Byrne said the government would continue to invest in our health services and infrastructure to ensure we deliver healthcare that is strong, sustainable and meets the needs of Tasmanians now and into the future.

"Our huge health capital investment program continues with a $171.5 million spend in 2012-13."

Ms O'Byrne said significant health initiatives and capital spending in the Budget included:

  • $27.3 million in 2012-13 for budget savings relief.  This funding will grow to just over $33 million in 2013-14 before settling at $30 million in 2014-15 and 2015-16.
  • $4 million this financial year to increase the number of endoscopy and elective procedures performed so patients have certainty and peace of mind about their future treatment.
  • $113.8 million in 2012-13 to continue the redevelopment of the Royal Hobart Hospital including site works for the new Women's and Children's Hospital.
  • $17.4 million in 2012-13 for the development of specialist cancer centres and for a statewide information technology system.
  • Rural and community health will see continued investment with projects including:
  1. $6 million for the upgrade of the Flinders Island Multi Purpose Centre
  2. $21 million to upgrade the Glenorchy Community Health Centre
  3. $5 million for the King Island Hospital and Health Centre upgrade
  4. $6.5 million on upgrading the Kingston Community Health Centre.

Ms O'Byrne said the Department had embarked on a range of savings strategies over the past 12 months.

"We have reduced the number of employees in the bureaucracy, and at every turn minimised the impact on frontline services.

"Savings have been made in the motor vehicle fleet, in the Department's telecommunications and by reducing non-essential conferences, travel and training.

"We have implemented a 10 per cent reduction in non-service delivery units, ceased overtime for non-frontline positions and reduced overtime across the board by 5 per cent.

"Hospitals have found savings in procurement activities and there has been a reduction in middle management and in non-salary expenditure.

"Savings have been made by restructuring rosters, reducing locum costs and better managing annual leave and sick leave.

"Hospital CEOs and their teams have done an incredible job increasing productivity and finding ways to improve efficiency and effectiveness.

"Achieving savings of this magnitude has been a tough ask - but it has been crucial in protecting our health system for all Tasmanians for the future."


Delivering a Strong Health System for Our Future