New health entities ‘fully functional’ by Sept 2022

June 1, 2021

Transition unit bosses give clues on how sweeping health reforms will roll out.

New laws underpinning the Government’s proposed health reforms will be introduced to Parliament in September.

Podiatry image by valuavitaly on Freepik

And everything – including health workers’ employment contracts – should be switched across to the new health entities by July next year.


September is shaping up as a key month for the Government’s fast-tracked changes to the health system.

In April, the Government announced it would replace district health boards with Health NZ (HNZ), and create a new Māori health authority (MHA).

Speaking to members of General Practice NZ, former director-general of health Stephen McKernan said new legislation was expected to be introduced by September this year. McKernan was appointed last year to head the transition unit.


Some functions and staff could be transferred to the new entities by January 2022.

He said an interim MHA and HNZ would likely also be established in September this year. By January 2022, some functions and staff could be transferred to the interim entities.

Data and digital services, performance monitoring and mental health services were the sort of functions that could shift across in the six months it would take for the legislation to move through Parliament.

The new law would be passed by April and come into force from July 1, which would see remaining staff, assets and liabilities transferred to the new entities.

It was expected they would be fully functional, carrying out all legally required work, by September 2022. The transition unit would then be disestablished.

Deputy director of the transition unit Martin Hefford said it was expected contracts with DHBs or the Ministry of Health that ran past July 1 next year would be switched, with “same terms and conditions”, to HNZ or the MHA.

The employment contracts DHB staff such as nurses and doctors would be transferred as well.

“There will be changes, but a system that employs something like 80,000 people and contracts with another 100,000-odd: we do not want to destabilise ‘business-as-usual… we want a bit of time to clear away some of the roadblocks that have been there.”

He said commissioning powers under the present system were spread too thin.

McKernan said the MHA would have the power to commission kaupapa Māori services – and so would HNZ.

Both would work “incredibly closely”, he said, including having co-commissioning powers.

The 12 public health units would be rolled together into a single, national public health service within HNZ, he said. They would work together in a single system.

In May, the Government set aside about $250 million in Budget 2021 to set up the MHA. Finance Minister Grant Robertson said the money was only for the transition. There would be “plenty” more money coming for the MHA’s operation.

Overall, the Government tagged $486 million to kick start the revamp. It is expected the 2022 and 2023 Budgets would be where a true indication of the funding levels would become clearer.

The reforms were largely based on the recommendations of the Health and Disability System Review, chaired by Heather Simpson. It recommended keeping a smaller number of DHBs, and a creating a non-commissioning MHA, but the Government pushed further than those recommendations.

The changes come amid long-term health inequities for Māori, which see them die on average seven years earlier than other New Zealanders.

In May, Health Minister Andrew Little announced a steering group to pick interim MHA board members.

Tā Mason Durie was appointed to select the steering group, which comprised Dr Matire Harwood, Parekawhia McLean, Tā Mark Solomon, Rāhui Papa, Kim Ngārimu, Amohaere Houkamau and Lisa Tumahai.

Harwood (Ngāpuhi, Ngāti Rangi, Te Mahurehure, Ngāti Hine) would be the only steering group member with clinical experience.

She is associate professor in the Department of General Practice and Primary Care, at Auckland University, and is also a general practitioner at the Papakura Marae Health Clinic.

Tā Mason (Rangitāne, Ngāti Kauwhata, Ngāti Raukawa) has spent more than 40 years involved in Māori health and is emeritus professor of Māori Research & Development at Massey University.