SPECIFIC SANCTIONS FOR DISTRICT HEALTH BOARDS REQUIRED FOR INCLUSION IN LEGISLATION
   

MEMORANDUM TO CABINET SOCIAL POLICY AND HEALTH COMMITTEE

SPECIFIC SANCTIONS FOR DISTRICT HEALTH BOARDS REQUIRED FOR INCLUSION IN LEGISLATION



CONSULTATION
  1. This paper has been prepared by an interagency working group led by the Ministry of Health, working with the Health Funding Authority, The Treasury, State Services Commission, and Crown Company Monitoring Advisory Unit. In addition, the Department of Prime Minister and Cabinet has been consulted in the preparation of this advice.

    FINANCIAL IMPLICATIONS

  2. 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) M 2/4 refers].

    LEGISLATIVE IMPLICATIONS

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

    HUMAN RIGHTS ACT 1993

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

    REGULATORY IMPACT STATEMENT

  5. A Regulatory Impact Statement prepared in accordance with the requirements set out in CO (98) 5 is attached.

    PUBLICITY

  6. Any publicity related to the establishment of DHB accountability arrangements will be managed within the overall Communications Strategy developed by the Communications Workstream Group [CAB (00) M 11/1A refers].

    CABINET

    1. agreed to the governance arrangements for District Health Boards (DHBs), including the Ministerial power of direction; and

    2. noted that further advice would be provided on governance and other issues, including the detail of a residual Ministerial power to merge DHBs [CAB (00) M 11/1A(3) refers];

  1. noted that on 8 May 2000, Cabinet directed officials to report back to the Ad Hoc Ministerial Committee with advice on the development of specific rewards and sanctions for application by the Ministers of Health and Finance and criteria for their application, the report on those to be incorporated into legislation to be provided by 8 May 2000, and the report on the complete framework by 31 August 2000 [CAB (00) M 15/10 refers];

  2. noted that the paper attached to CAB (00) 322 examines the specific rewards and sanctions required for inclusion in the New Zealand Public Health and Disability Bill;

  3. noted that the report back on a detailed framework for rewards and sanctions to be provided by 31 August 2000 will include:

    1. the criteria for the use of rewards and sanctions, and an escalation path for their use; and

    2. further advice to Ministers on the removal of specific functions from the DHBs as a sanction;

INTERACTION WITH CROWN ENTITIES REFORM

  1. noted that Cabinet on 12 June considered recommendations from the Cabinet Committee on Government Expenditure and Administration on Crown entities reform and that its decisions are set out in CAB (00) M 19/1I(1);

  2. noted that the Crown Entities Reform legislation resulting from the consideration referred to in paragraph (e) above is likely to provide the legislative transparency required for the duties of individual DHB board members and the collective board;

  3. agreed that, when enacted, the provisions in the Crown Entities Reform legislation on the duties of boards and individual board members would apply to DHBs;

  4. agreed that the health legislation state that legislated sanctions will be applied for failure against the duties of boards or individual board members;

  5. noted that the proposed Crown Entities Reform legislation is likely to follow the health reforms, but precede the election of DHB board members in October 2001;

  6. agreed that a provision be made to amend the New Zealand Public Health and Disability Bill to include the duties of the DHB board and individual board members if enactment of the Crown Entities Initiative is delayed beyond October 2001;

    MINISTERIAL POWER OF DIRECTION

  7. agreed that the following checks be provided in the New Zealand Public Health and Disability Bill to ensure that the Ministerial power of direction is used appropriately: the Minister of Health shall consult the affected board(s) as to the direction given in the notice; no direction given by the Minister of Health may require the supply to any person of any information relating to an individual that would enable the identification of the individual concerned; the Minister of Health shall take account of the objectives of the DHB as specified in legislation before issuing a notice of direction; the written notice of direction shall be published in the Gazette and tabled before Parliament as soon as practicable after the direction has been issued;

    CROWN MONITORS

  8. agreed that the Minister of Health be enabled under the New Zealand Public Health and Disability Bill to appoint Crown Monitors to the boards of DHBs;

  9. agreed that Crown Monitors will:

    • report directly to the Minister of Health;

    • not have voting rights on the board, but will have all other rights of board members, for example, the right to attend all board meetings, and receive all reports and minutes for the board and its committees;

  10. agreed that a Crown Monitor's role will be to:

    • observe the board's decisions and decision-making processes;

    • assist the board in understanding the Government's policy and wishes so they can be reflected in the board's decisions;

    • advise the Minister of Health on the performance of the board, and how it is addressing the Minister's specific expectations;

  11. noted that the appointment of Crown Monitors will be in addition to the routine monitoring of the board by central agencies, and board accountability;

    DEMOTION / REPLACEMENT

  12. agreed that the New Zealand Public Health and Disability Bill will provide a mechanism for the Minister of Health to sanction the DHB by demoting or replacing the Chair and/or Deputy Chair;

  13. noted that on 31 January 2000, Cabinet agreed that the New Zealand Public Health and Disability Bill will give the Minister of Health the power to replace the board with a Commissioner [CAB (00) M 2/4 refers], and that this will provide a mechanism for sanctioning the board;

    OTHER REWARDS AND SANCTIONS

  14. agreed that the New Zealand Public Health and Disability Bill will provide for specific DHB performance reports to be made public;

  15. noted that section 16 of the Public Finance Act 1989 will allow the DHBs to generate and retain surpluses, or repay their surpluses to the Crown "as the Minister thinks fit";

    MERGERS OF DHBS

  16. agreed that the Minister of Health should have reserve powers in legislation to merge DHBs if the Minister considers there is a compelling case that a merger will result in significant benefits to the local community, and an impasse in negotiations is reached between the DHBs concerned;

  17. agreed that DHBs should not be sanctioned through merging them together.



 
      PREVIOUS | CONTENTS | NEXT  

 
HOME PAGE | DOCUMENT DOWNLOAD