PATCHED PLANNING

Evening Post, Volume CXXXII, Issue 134, 3 December 1941, Page 8

PATCHED PLANNING

The anomalies of the public, hosipital finance system are becoming so glaring that they cannot be ignored. The Minister of Health admitted that there were -faults when he said in Waitara yesterday that the time was not far distant when a uniform rate for hospital expenditure should apply over all districts in the Dominion. "Men and women of all political parties will agree," he said, "that there is something wrong about a system that allows people in one locality to be taxed for a social service more than a community in another locality." Local authorities who have to collect part of the money in rates have been much more emphatic in their condemnation of the system. They had hopes that the Social Security scheme and its "free" hospital treatment would bring correction of faults, but it did not. Rather, it added to the anomalies and madei them more unfairly burdensome. Now we have the hospitals financed from three sources: rates, levied upon land or land and buildings; taxes collected for the Consolidated Fund, and special taxes collected for the Social Security Fund. In the apportionment of charges between _ the three sources of revenue there is a system, but not one that can be justified by principles of financial administration.

The trouble has been aggravated by; the Government's patchwork planning. When it was proposed to make the hospitals free to users, it was clear that this would result in greater demands upon the institutions. The financial arrangements should have been designed to cover the cost of those greater demands; They were not so designed, except in so far as the Social Security payment was to be on an occupied bed 1 basis. But as the Social Security payment met only a part of the cost of each occupied bed, and as the number Qf occupied beds rose quickly because of the change of system, a great part of the increased cost fell upon rates and general taxation. The Medical Superintendent of Wellington Hospital in his recent, report stated that it would be idle to deny that the provision of free hospital treatment under the Social Security scheme had had an effect in causing persons to seek hospital treatment in preference to treatment in, their own homes. The greater demands led not only to heavier maintenance costs (met in part from the Social Security Fund), but also to heavier capital costs, chargeable to rates and general taxation. An equitable system should place upon the Social Security Fund the real costs of the "free" treatment —capital as well as maintenance. While this remains undone, Social Security gets the credit, but far too big a share of the debit lies upon ratepayers.