PWC review of Southern District Health Board ongoing

In a case of spending money to save it, Southern District Health Board is shelling out thousands of dollars to a business services company.

This week the board confirmed it paid PricewaterhouseCoopers (PWC) $25,000 over about eight weeks to the end of August - the actual bill will be higher because the firm will assist until about the end of the year.

PWC was called in when the board discovered an unexpected cost overrun near the end of the 2011-12 financial year.

Managers did not respond to requests for an updated figure.

Board member Tim Ward, who is chairman of the audit and risk committee, acknowledged the total bill would be higher, because PWC's work was ongoing.

PWC was helping in two areas - finding savings, and improving the quality of reports to the board from managers. Its work on reporting was nearly finished, but on cost savings it would assist until about the end of December, Mr Ward said.

He agreed it was a case of spending money to find savings, and to reassure the board it was not out of kilter with other health boards.

PWC's findings thus far had surprised no-one, Mr Ward said.

The company identified no "silver bullet that's going to fix Southern DHB".

However, it was helping to identify potential savings and efficiencies in a number of areas.

PWC provided an external view which was obviously not possible from inside the organisation.

Mr Ward rejected a suggestion that September 2010 job losses in the finance and planning and funding departments meant the board had to outsource such work.

About 6.5 full-time jobs were lost in the restructuring.

However, he acknowledged the role of finance and funding executive director, created in May, 2010, when two roles merged, was too big.

Further restructuring under way would provide more support.

"It's accepted that it's more than a single person's role."

The board is awaiting acceptance from auditors of a $13.2 million 2011-12 deficit.

- eileen.goodwin@odt.co.nz