The Dominion. TUESDAY, FEBRUARY 22, 1938. PUBLIC HOSPITALS FINANCE

Dominion, Volume 31, Issue 126, 22 February 1938, Page 8

The Dominion. TUESDAY, FEBRUARY 22, 1938. PUBLIC HOSPITALS FINANCE

Broadly speaking, two questions are involved in the proposal to spend £750,000 on the Wellington Public Hospital. First, is there a case for the provision of extra accommodation for patients and nurses and the improvement of the administrative and domestic facilities? Secondly, having regard to the amount involved in this and future expenditures, is it equitable that a large part of the burden should be borne by one section of the-community alone —by. the ratepayers? The fact that these two questions are related makes it difficult to examine dispassionately the intrinsic merits of any proposal for expenditure on hospitals generally. Ratepayers are complaining, and with justice,.of the burden they are already carrying. The hospital is a humanitarian enterprise, making a strong appeal to public sentiment. It is manifestly unfair, therefore, that ratepayers should be placed in the position of having to pass judgment on a proposal for hospital expenditure which may impose an additionaktax on their own resources, but. which on the merits of the case and in the public interest may be justified. At the conference with the Minister of Public Health on Friday last it was admitted that increased accommodation for both patients and nurses was urgently required, but there was a difference of opinion on the question whether it might not be possible to meet those requirements with a less expensive scheme. This raised the question whether if less were spent now more would not have to be spent later. But always in the background of the picture was the liability of the ratepayers, and whether they could stand it, faced as they undoubtedly are with the possibility that the scheme when completed is likely to cost nearer a million than the estimate of £750,000. . In regard, to. the city itself, this, as the mayor pointed out, will mean an extra liability of £50,000, to be met either by making an extra call on the ratepayers or by cutting down on municipal services. Having made this pen nt, Mr. Hislop raised the question which is fundamental, to hospital finance in general—the incidence of taxation. The Minister was not prepared to discuss that, but undertook to have the question leferred to the Government for consideration if he were asked to do so. As a matter of justice this ought to be The present basis of hospital finance is more or less a compromise between traditional usage and year to year requirements. Hospitals began as public charities, supported by voluntary contributions. These have dwindled gradually as they came more and more under official control. As the revenue from this source diminished the pressure on the local bodies and on the general Government became more severe, as is shown by the trend of the figures herewith tabulated:

On present returns the levies on the contributory local authorities and the Government subsidy each form about one-third of the total maintenance receipts of the hospital boards, the remainder being chiefly patients’ fees and other revenues on account of relief. Since 1932 State subsidies on voluntary subscriptions and bequests have been discontinued. Capital expenditure is met by levies and State subsidies on the basis of £1 for £l, but in the case of heavy expenditures, such as that proposed for Wellington, the boards have recourse to loans. Another point of interest is the revenue from patients’ fees. Although the number of patients has increased, the recoveries of fees have diminished. For example, the number of in-patients treated rose from 85,562 in 1931-32 to 100,592 in 1935-36, but within the same period the amount received per occupied bed dropped from £60.5 to £46.7. The tendency thus is to throw an increasing burden on the local bodies and the general Government, and this undoubtedly will be increased with the introduction of the health insurance system contemplated by the Government. Having regard to the above figures, and other factors relevant to the general question of hospital finance, it must be clear that the incidence of taxation in this connection, is due for investigation. The eight mental hospitals in the Dominion are maintained wholly or in part out of the public revenue. The part consists of patients’ fees and the sale of produce.. Should not the public hospitals be placed on the same basis? In view of the health insurance scheme the question is timely, and should be taken up by the Government as relevant to the development of the hospitals as a public service.

Subscriptions. £ Local Bodies. £ Government. £ 1913-14 49,856 175,120 219,520 1921-22 25,108 436,619 391,113 1935-36 .. 16,964 621,271 685,630