An unaudited draft annual report, tabled at an additional council meeting last week, shows Waitaki District Health Services had a net surplus of $2,637,143 for the 2020-21 financial year.
However, the report is a consolidation of the accounts of Waitaki District Health Services Ltd (Oamaru Hospital), the Waitaki District Health Services Trust and the Observatory Village Charitable Trust Group, and the financial results are not broken down for each arm of the operation.
This is due to a 2019 ruling by the Auditor-general for Waitaki District Health Services, a council-controlled organisation, to include the operations of the Observatory Retirement Village in its annual reporting.
After last week’s council meeting, Waitaki District Health Services chairman Mark Rogers confirmed Oamaru Hospital recorded a net overall deficit of $1,071,209.
This was more than the forecast deficit of $986,000, but a $1.3 million improvement on the previous year’s $2.4 million deficit.
Across the group, there were 25 staff earning between $100,000 and $390,000 a year - an increase from 11 last year.
The cost of locums had reduced by $1.5 million, by hiring permanent medical staff, but the overall personnel cost had increased by $1.7 million.
There was a $415,000 increase in remuneration for management and directors from last year, with the addition of two full-time-equivalent director positions, and 5.29 FTE management positions.
In the interests of transparency, Cr Colin Wollstein requested a breakdown of the group’s financial results be made available to the council, so councillors could see where costs had arisen.
‘‘Because it does seem that there’s quite a large increase in the non-medical costs . . . of running the operation, which is not where money should be spent,’’ he said.
‘‘The employees [earning] over $100,000 going from 11 to 25, well, where are they? Are they doctors at Oamaru Hospital who are replacing locums in the past? At this time, we just can’t see it.’’
Waitaki Mayor Gary Kircher said the Auditor-general’s ruling had been ‘‘unexpected and unfortunate’’.
‘‘The problem is, you lose transparency when you bundle the different entities together - there’s no clarity around what the individual results are,’’ Mr Kircher said.
‘‘So I think we need to look at getting that key information split out for each entity and making sure that’s then reported.’’
Mr Rogers said Waitaki District Health Services would provide the individual financial results to the council.
‘‘They want to show transparency because they’ve shown a really good turnaround from where they were, but it’s really difficult to see that,’’ Mr Kircher said.
‘‘It’s just a matter of working with them on that.’’
Mr Rogers said the focus of the 2020-21 financial year had been ‘‘steadying the ship and rebuilding the foundations’’.
Several factors would continue to affect the hospital’s operations, including the evolving Covid-19 response, as it would likely becoming endemic in the South Island during the current financial year; high patient presentation volumes coupled with high acuity; and the shortage of skilled health professionals in New Zealand, he said.
However, the forecast for the current financial year was an overall break-even, with an expectation of an operational break-even the following financial year.
‘‘This will be a turnaround of over $3 million in three years,’’ Mr Rogers said.
