Public Health Funding Flows Largely to Private Providers, Unions State

UPDATE - follow-up to Private sector gets 80% of increase in public health funding, unions' report finds: Eighty percent of the recent three-year increase in government public health funding has gone to the private sector, according to a report by Public Futures Aotearoa. This equals $2.4 billion of a total $3 billion increase. The coalition of healthcare worker unions includes the New Zealand Nurses Organisation, the Association of Salaried Medical Specialists and the Public Service Association, alongside the Centre for International Corporate Tax Accountability and Research.

Growth and Spending

The private sector received nearly half of all public health spending at 46.4 percent in 2024/25. Report author Edward Miller states that public delivery growth has stalled while private healthcare scales up. Publicly delivered healthcare through Health New Zealand and ACC saw an increase of $600 million in the same period. General practice revenue now relies on public funding for 55 percent, and a 2026 estimation shows a quarter of all GPs are owned by corporations. Private hospitals received more than one billion dollars for publicly funded surgeries in 2024/25, marking a 93 percent growth over four years. Three entities control 70 percent of private hospital beds. Diagnostics, imaging, aged residential care, and home and community support services also draw heavily on public revenue.

Responses

The Public Service Association and the New Zealand Nurses Organisation are both campaigning for a government change. A spokesperson for Health Minister Simeon Brown stated he does not respond to reports from unions campaigning to change the government. On background, the office noted Health NZ delivered 43,819 outsourced procedures in 2025/26, putting them 11.9 percent ahead of target. Health NZ stated it focuses on using public funds responsibly to improve care access and lift health outcomes.

Context

Outsourcing public health services to private entities has become a major subject of debate regarding the efficiency and cost of healthcare delivery. Critics argue that public funds should build public sector capacity rather than pay for private investor returns, while defenders point to reduced wait times through outsourced procedures. Understanding these spending trends helps clarify broader discussions on public sector funding versus private delivery models.