HOSPITAL SUPPLIES

Otago Daily Times, Issue 24945, 18 June 1942, Page 2

HOSPITAL SUPPLIES

There are no reasonable grounds for criticism of the direction given to the Waitaki Hospital Board by the Director-general of Health regarding the purchase of hospital supplies—namely, that after the fullest opportunity has been given for tendering, according to the nature of the supplies required, there is an obligation on the board to make its purchases to the best advantage. At a meeting of the board this week Mr Familton appeared to argue' that by buying everything possible on the Oamaru market at a competitive price the board might claim to be buying " to the best advantage." Naturally the board would wish, wherever possible, to put its business in the way of local traders. And, all else being equal, the local trader would be entitled to receive,' and doubtless would receive, (he board's

patronage. Where, however, public •moneys are being expended—as in the case of hospital boards, which ?,re heavily'subsidised out of public funds —the principle that the local market should enjoy by right even a measure of preference or protection is not sound. Although Mr Familton would seem to suggest the contrary, the position of a hospital board in respect of its finances is not analagous to that of a borough council or other local body that is responsible for the collection of its entire revenue. As was pointed out during the discussion, one half of a hospital board's receipts is obtained from the Government, the balance being secured by levies on local authorities within the board's district. In general practice all local authorities exercise their spending powers to the best possible advantage by buying in the cheapest market available to them. But, in the case of hospital boards, the Government has particular justification for insisting that, since public funds are involved —funds provided by the taxpayers as a whole, not by the taxpayers and ratepayers of any single district—expenditure shall be directed into channels from which the best value is to be. obtained. Nine times out of ten the local market might offer the most favourable terms of purchase, in which case all parties would be satisfied. But it would obviously be unwise and not in the interests of economic administration for any board to tie itself to a practice in which a system of local purchase, if that were always practicable, was adopted.