Relationships with Maori
60. The Maori Partnership paper recently considered by Ministers raised a number of concerns and identified potential risks to ongoing Maori provider development within the new sector arrangements. Officials were directed to report back with advice on minimising incentives on DHBs to favour DHB services over Maori providers and strengthening incentives on DHBs to encourage Maori service development [CAB (00) M 11/1A(4) refers]. Officials believe that the accountability arrangements proposed in this paper provide a range of mechanisms to mitigate the potential risks identified and encourage the most appropriate arrangement for improving Maori health and disability outcomes.

61. The accountability framework proposed in this paper provides mechanisms for giving effect to the principles of the Treaty of Waitangi at the DHB level, and for achieving effective working relationships between Maori and the Crown with an emphasis on closing the gaps between Maori and non- Maori health and disability outcomes. In particular the mechanisms proposed will provide the basis for:
    1. Government clearly articulating its goals, objectives, targets, and other expectations of DHBs in respect of Maori, through its New Zealand Health Strategy and New Zealand Disability Strategy
    2. DHBs demonstrating their responsiveness to Maori, through consultative and decision-making processes to be reflected in each DHB's Strategic and Annual Plan, including through partnership relationships
    3. DHB accountability for developing specific goals, objectives, targets and strategies improving Maori health and disability outcomes through the DHB's Strategic and Annual Plan
    4. iv. DHB accountability, including for transparent processes, for funding the mix of services and the method of provision (Maori provider or DHB provider arm), in order to improve Maori health and disability outcomes, through the DHB's Strategic and Annual Plan
    5. accountability for Maori capacity building, Maori provider development and enhancing the responsiveness of mainstream services to Maori, as defined in the Maori Partnership paper [CAB M 11/1A(4) refers]
    6. performance assessment and monitoring of financial and non-financial performance in respect of Maori service funding and provision, through regular and annual reporting.

62. In addition, DHBs will be expected to formalise operational partnership relationships through the use of mechanisms such as Memorandum of Understandings, Charters or Relationship Agreements. Each DHB will be required to set out the particular relationship arrangements in place, and the impacts and specific benefits to flow from these in their Strategic and Annual Plan. DHB Consultation with their Community

63. The Government has made clear its expectation that there will be greater community involvement within the health and disability sector. Elected representation to the Boards of DHBs will contribute to this objective. In addition, it is recommended that the legislation place a requirement on DHBs to consult communities on a broad front and, in particular, in the development of DHB Strategic Plans.

64. The Local Government Act 1974 requires local authorities to use a special consultative procedure as part of their annual planning and reporting process. The development of a similar 'special procedure' for DHB consultation would appear to offer benefits in terms of providing a structured framework for community involvement in DHB decision-making. Officials will undertake further work on the design of a 'consultative procedure' to provide a framework within which DHB consultation would occur and will report back to the Ministers, as part of the advice on establishing a regulatory framework for DHBs, by 31 August 2000. This advice will cover matters such as the recording and documentation of DHB consultation.

    Encouraging Inter-DHB Co-operation

65. There is an inherent risk within the sector arrangements of DHBs not acting in accordance with the collective interests of the Government. DHBs will be expected, through their accountability arrangements, to form strategic alliances or performance partnerships with other DHBs. The centre, in particular the Minister of Health will have a key role in motivating and facilitating the establishment of these relationships. Each DHB will be required to set out the particular performance partnerships in place and the impacts and specific benefits to flow from these in their Strategic and Annual Plans. The purpose and benefits of co-operative relationships would include:
    1. promoting collective responsibility for delivering the Government's health outcomes and priorities, for example, mental health, Maori health
    2. ensuring co-ordination between the DHBs in terms of service funding and delivery leading to consistent and equitable provision of services across DHBs
    3. co-ordinating funding and service delivery activities where there are issues of critical mass and where arrangements (for example joint ventures) will reduce transaction costs on providers, for example, Maori organisations spanning DHB boundaries
    4. promoting co-ordinated and seamless care to consumers of health and disability services across DHB 'boundaries'
    5. co-ordinating workforce development activities and capital investment projects.

66. Work is currently being undertaken to develop a plan for establishing DHBs and transitional arrangements related to this. Once Ministers have decided on the accountability arrangements for DHBs, Officials will report back on the accountability arrangements for DHBs in the transitional phase.

RELATED ISSUES

Ministry as Funder
67. Ministers will shortly be considering the relative roles and responsibilities and division of these between DHBs and the Ministry of Health [CAB (00) M/2/4 refers]. The Government has previously indicated that the Ministry of Health may fund some services such as those that are funded through a national organisation, or national services delivered through a single provider (e.g liver transplants).

68. It is recommended that when Ministers consider the options for allocating specific funding roles, Ministers also consider advice on accountability arrangements related to the Ministry's funding role.

CONSULTATION

69. This paper has been prepared by an interagency working group led by the Ministry of Health, working with the Health Funding Authority, Te Puni Kökiri, Treasury, State Services Commission, Crown Company Monitoring Advisory Unit and Office of the Auditor-General. In addition, the Department of Prime Minister and Cabinet has been consulted in the preparation of this advice.

FINANCIAL IMPLICATIONS

70. Full identification of the one-off costs and ongoing fiscal impacts of the proposed structural changes, including those related to the establishment of DHB accountability arrangements, are included in the report back of the Fiscal Implications Working Group
    [CAB 00 M2/4 refers].

LEGISLATIVE IMPLICATIONS

71. This paper makes specific recommendations on matters to be included in the drafting of the New Zealand Public Health Services and Health Reforms (transfer and transitions provisions) Bill.

72. It is recommended that DHBs are added to the Fourth, Fifth and Sixth and Seventh Schedules of the Public Finance Act. DHBs will therefore be subject to the requirements set out in this Act.

HUMAN RIGHTS ACT

73. The advice provided in this paper does not have Human Rights Act 1993 implications.

REGULATORY IMPACT STATEMENT

74. A Regulatory Impact Statement is attached for submission to Cabinet in accordance with the requirements set out in CO (98) 5.

PUBLICITY

75. Any publicity related to the establishment of DHB accountability arrangements will be managed within the overall Communications Strategy developed by the Communications Workstream Group [SPH (00) M 6/6 refers].