Robert MacCulloch
Robert MacCulloch is a native of New Zealand and worked at the Reserve Bank of NZ before travelling to the UK to complete a PhD in Economics at Oxford University.
Why has healthcare in NZ declined these past five years? In one line, it is because of the poorly thought out and economically unworkable “reform” of the system advocated by former PM Helen Clark’s Chief of Staff Heather Simpson. It became known as the Simpson Report and was published in 2020, the year coinciding with plummeting healthcare services in NZ. Here is the executive summary.
As a reward, Simpson has recently been promoted to be a director of inter-island ferry procurement. That’s how Wellington works. What was the ethos behind the Simpson Report? Essentially that economies of scale and better coordination would come from the creation of one gigantic centralized authority, called Health NZ, as well as the establishment of a new Māori Health Authority. In Simpson’s world, centralized command systems, run by thousands of bureaucrats, is the best option.
Read the executive summary of Simpson’s Report above. It does not mention the words compete, competing or competition, once in its 36 pages. Not once. Think that’s bad? Read the full Simpson Report. It doesn’t mention the words compete, competing or competition, once in its 274 pages. Not once. That saw the end of quality healthcare services delivered at affordable costs in NZ.
Every significant person knowledgeable in health economics stresses how competition amongst suppliers of healthcare services is vital to achieve higher quality and deliver it more efficiently. That is how all of the best, most successful healthcare systems in the world work today, even in socialist-leaning France, let alone the likes of Canada, Singapore and Taiwan. All of those countries have universal healthcare systems, everyone is covered, and people have choice where to go for the best service. The bills are paid either direct by the government, or by government-sponsored national health insurance schemes.
Not in NZ. We stand alone in the mistaken Simpson-style belief that creating a gigantic centralized leviathan, Health NZ, formed on the philosophical ethos that competition is bad, and centralization to achieve scale is good, is the way to go. Not sure NZ First leader Peters agrees. He’s the one who appointed Simpson to his ferry board.
This article was originally published by Down to Earth Kiwi.
