Shockwaves felt in Dunedin Hospital after bombshell announcement

Regular leaks in Dunedin Hospital’s operating theatres are bad enough, but the surprising ones can be downright dangerous.
“We’ve got our own set of buckets in a cupboard somewhere for when it rains,” says Dr Claire Ireland, a consultant anaesthetist in Dunedin for 10 years, and the hospital’s clinical director of anaesthesia. “We have to carry on and drive the patients in their beds past all of the clutter and the dripping buckets to get to the recovery area. It usually always happens in a similar spot.”
Except when it doesn’t.
Ireland, a member of the union Association of Salaried Medical Specialists, says: “I’ve also been in an operating theatre when the patient’s having their surgery, and a two-metre-long crack appeared in the roof in the operating theatre, and some brown, dirty water started dripping through the ceiling – not into the patient’s surgical field, but right next to it, where the staff who were operating were.
“That is unbelievably bad.”
The alarming incident, which happened a couple of years ago, was caused by an ‘end of life’ ventilation system in the roof space above the theatre. Unsurprisingly, the choice was made, mid-surgery, to move the patient to another theatre.
Ireland states the obvious: “That should never happen.”
Problems with Dunedin Hospital’s cluster of ageing buildings have been known for years.
The 2017 indicative business case for a hospital rebuild said: “The clinical services block has critically reached the end of its serviceable life. The ward block – although structurally solid – has significant maintenance issues and impedes the delivery of efficient and effective services. Neither building is economic to repair or refurbish.”
(Two years earlier, a report said it would cost $125 million to keep the buildings going for another decade.)
That’s why, in the lead-up to the 2017 election, then-Prime Minister Bill English announced Dunedin would get the largest new hospital build in the country’s history, costing more than $1 billion. It would be opened in “seven to 10 years”.
A week later, Jacindamania hit the city. Newly installed Labour leader, Jacinda Ardern, solidified a new Dunedin hospital as a bipartisan policy, saying her government would eschew a public-private partnership to build it, because it would slow things down. “Actually, what we need is speed.”
Progress has been slower than hoped. The new outpatient building, for day surgeries, a few blocks from the hospital existing site, is due to open in 2026. Work is yet to start on the inpatient building.
Then, on September 26, there was a shock intervention. Health Minister Shane Reti and Infrastructure Minister Chris Bishop said recent project pricing on the Dunedin Hospital project had blown out by several hundred million dollars above the approved $1.88b budget.
The new hospital needed to be built within its existing appropriation, they said, or it could jeopardise hospital upgrades elsewhere.
(National’s pre-election promise was to build the hospital back to its original specifications, before a downgrade by the Labour Party. There’s now a debate over the Government seemingly prioritising roads over hospitals. Early last year, at a meeting in Gore, opposition leader Christopher Luxon, now Prime Minister, said: “We will make sure that in a growing area like Southland and Otago that we actually have the support that Dunedin Hospital will need.”)
Ministers are seeking urgent advice on two options: staging the development; or revising the project, such as reducing the number of floors, delaying fitouts, and/or retaining services within the existing hospital.
On the last Saturday in September, an estimated 35,000 people marched in central Dunedin to protest what’s being called a hospital downgrade.
I speak to Ireland, the consultant anaesthetist, days later, in a bare, functional room on the first floor of Dunedin’s psychiatric services building, near the executive leadership team offices. The sign on the door reads: “ELT hot desk 2.”
Ireland – who wasn’t on the march, but her husband and children were – was shocked and appalled by the ministerial announcement. “We live, breathe and work in this building. So to someone like me, a clinician working here, I know that it is an impossible task to bring this building back to life.”
She refers to an intensive care unit upgrade in the clinical services building, which was commissioned in 1967. The work was meant to take 18 months but ended up taking five years because of the difficulty of retrofitting ventilation into tiny roof spaces.
“That’s an example of how time, clinical risk, and cost blowout can occur if you try and put something new into this dilapidated building.”
Ireland reels off a list of faults. “We don’t have enough theatres. The theatres we have are cramped in, they’re tiny. Everything is completely cluttered.
“So we’ve got surgical equipment in bins and things in all the corridors where the patients come and have their surgery, and including surgical equipment hemorrhaging out into just the regular corridors in the hospital because there’s nowhere to put it.”
Earlier this year, a neurological surgery had to be postponed because rain blew in through a supposedly closed window, contaminating specialised instruments sourced from another South Island hospital, leaving the patient in considerable discomfort for two days.
Signs warning of the danger of asbestos can be found throughout the hospital, on cupboard doors, and on the walls behind toilets.
People in Otago and Southland don’t have fair access to elective surgery compared to the rest of the country, Ireland says.
“Our waiting lists are huge, and that is because we don’t have enough capacity to look after people. We’re constantly, every day, making decisions to who gets their surgery – and, of course, it has to be emergencies, acutes, cancers.”
The issue of waiting times is picked up by Linda Smillie, a clinical nurse specialist in neurology, and NZ Nurses Organisation delegate, who has worked at Dunedin Hospital for 20 years. We talk outside the hospital, next to a concrete pillar, below road level, as traffic roars past, our voices occasionally drowned out by the rumble of trucks and buses.
Waiting lists for planned surgeries at Dunedin are too long, Smillie says, especially for orthopaedics – a medical specialty focused on injuries and diseases of the body’s musculoskeletal system, including bones, joints, ligaments, tendons, muscles, and nerves.
“People [are] waiting for years for their hips and knees because there’s just not enough theatres, not enough beds.”
Smillie describes the ministerial announcement as a “gut punch”. “I was really frightened by what they were saying because it showed they had a complete lack of clinical knowledge.”
What makes her say that? The existing building’s not fit for purpose, she says. Upgrading it has already been looked at – “it’s not doable”.
“We’ve also now got an outpatient building that’s two and a half blocks away, and I don’t think they actually understand the relationship between inpatient and outpatient – clinicians and patients are moving all the time between those two areas.”
It’s not just Dunedin’s hospital, Smillie says – but Otago’s and Southland’s. (The rural areas are strongholds for National and other coalition parties.) That point was underlined during the protest march when the rescue helicopter flew over – a reminder at least a third of the hospital’s patients come from outside the city.
“The public are so angry,” Smillie says. “They’ve waited for a facility that would actually be okay for their health for many years, and now it’s trashed. And the ministers are saying, ‘We’ll just take a couple of floors off and we’ll just fit things as we need it’. Well, it just shows that they’ve got no clinical competencies.”
She worries medical staff won’t come to Dunedin to work in a tired hospital. “It doesn’t have the facilities other hospitals have. And if it’s downgraded, we’ll never get people, they’ll never come.”
As things stood a few weeks ago, the new hospital was “only going to be adequate”, she says. “It wasn’t a Ritz, it wasn’t five-star – it was adequate for our needs. Any downgrade means it’s inadequate. And when there’s inadequate facilities patients get hurt.”
Since the new hospital project began, Ireland has given project managers her views on the clinical needs for the planned inpatient building. As it stood a few weeks ago, it would have been “an adequately sized hospital”, she says.
The hospital project has been dogged by cost overruns and cutbacks. At the end of 2022, the Labour government announced $110m in extra funding – to $1.58b – to address a $200m budget blowout – a cut of $90m.
There were reduced beds (to 398, down 12) and fewer theatres (26 rather than 28), a reduction of MRI scanners from three to two, and a delay of installing a PET CT scanner.
After public pressure, some services were put back. Ireland starts to say staff have come to terms with the cuts, but corrects herself – saying the cuts were “accepted”.
She shifts tenses, signifying her optimism the Government’s planned downgrade won’t fly.
“It could have been – and will be, I sincerely hope – an amazing facility that can transform the way we look after people. It will be so much more efficient as well, and a safer building.”
Physical constraints at Dunedin Hospital have been paired with other problems, such as the suspension of accreditation status for radiology services and the withdrawal of training accreditation for the hospital’s intensive care unit.
Dr Tim Lequeux, a respiratory and sleep physician, another member of the Association of Salaried Medical Specialists, sits wearing his surgical cap in a window-less room on the seventh floor of the ward block. The Dunedin man started his training at the hospital in 2011 and he’s been working there as a specialist since 2020.
That morning, he’d been looking at the emergency department board to see if any patients were heading his way. What he saw was a list of people waiting “12-14-15 hours on a day where the ED list was quite short”. “I’m sure if we look now there’ll be 50 or 60 people in there, and there’ll be people who’ve been in there since yesterday.”
The fat has already been trimmed off the new hospital project, he says, “and probably some of the muscle as well”. Compromises have already been made – some, obviously, through gritted teeth.
For example, right now, when he does procedures around people’s lungs there’s a treatment room, with all the equipment, on the ward. “That way if something goes wrong the nurses are nearby. In the new hospital, there’s no treatment room on my floor.”
He shakes his head at the recent ministerial statements, which have made him reflect on his own work environment. His own department hasn’t had an increase in doctors for more than 10 years. “How are we going to be able to push the case to actually get some respite, and be able to see everyone we need to see?”
Lequeux attended the protest march. “It was heartwarming,” he says. “At the same time, I felt like, who’s going to listen?” He doesn’t care about the size of the new building or where it is – “it just needs to meet our needs”.
Pete Hodgson, a former Labour health minister and chair of Southern DHB, was shoulder-tapped by David Clark – his successor as Dunedin North MP and Ardern’s health minister until he was disgraced over Covid lockdown breaches – to lead the Southern Partnership Group, which oversaw the new Dunedin Hospital project.
We sit on the front porch of Hodgson’s house, not far from Port Chalmers, his electric car charging on the driveway, surrounded by an assortment of trees – rhododendrons, flowering cherries, crab apples, holly, a cabbage tree – blowing in the breeze.
Why didn’t he push for a new Dunedin Hospital while he was health minister between 2005 and 2007? “I don’t remember knowing about that,” Hodgson says.
Reti said a week earlier the “unattractive” central city site drove up costs, given it was flanked by state highways, and had contaminated ground, piling difficulty and flood risks. (That overlooks Bill English’s comment in 2017 that an appropriate site for the new hospital would be secured, “with a strong preference for a central city location”.)
So why build it there? Hodgson says the Cadbury factory coming up for sale was perfect timing, and it was bought “for a song”. The contamination and piling risks on that site, and the adjacent Wilson block, “turned out to be bugger all”.
He points to the university, the medical school, and the polytechnic being in the central city. “Dunedin produces more health science graduates than any other centre in New Zealand,” he says. “There is a concentration of health science in Dunedin, unmatched – and you put a hospital there.”
When Hodgson was appointed in November 2017, he says “precisely nothing” had happened. After that slow start, there was Covid, of course. But also, there was “clinical distress” about operating in leaky, asbestos-ridden hospital buildings, so time, effort and money went into getting more day surgeries done.
What does he make of the options now being considered by the Government?
Hodgson harks back to September 2022, when, under Labour, the hospital project was trying to save money. All the previous papers were re-read, he says, numbers for capital spending were re-run, and all options were on the table, including modernising the existing buildings.
“We went back and looked at it all again and it doesn’t fucking add up,” he rasps. “After having your hospital a construction site for the thick end of a decade, you end up with a brand-new, 60-year-old building, and the assumption is that you will need to do that again two decades later.”
Hodgson accuses current ministers of using lazy words, and being deceptive by adding costs to the project that weren’t part of the scope, like the car park (assumed to be a private development), and a pathology laboratory, and more than $300m of refurbishments to the ward block, “for what?”. “Of course it’s going to cost $3b if you keep adding stuff to it.”
The Government is obligated to ensure the project’s costs are controlled, the buildings are efficient, and tenders are competitive, he says. Beyond that, building a hospital should be, according to Hodgson, a yes/no decision.
He’s particularly scathing of the prospect of reducing the inpatients’ building. “You need only take one floor off the tower the planned [inpatient] tower, take it down from 11 storeys to 10, and it is smaller than the existing hospital in terms of number of beds.
“It certainly would have more theatres. It certainly would have more imaging technologies and recovery rooms and so on, lots and lots of things that would have more of. But if beds is the measurement, it would be fewer.”
Newsroom put many of the comments from Ireland, Smillie, Lequeux and Hodgson to Health Minister Reti’s office. We asked questions, including:
Reti responded with a statement, some of it repeating comments he made over the previous week.
“I absolutely recognise the passion reflected around Dunedin, and it’s important that’s acknowledged,” Reti says.
“I also recognise and value the commitment and dedication of the clinicians and health team leads we spoke with in Dunedin last week.  
“In particular, the insight and inputs of the clinical leaders group will continue to be valued as the process moves forward. 
“Since the announcement, I have been reinforcing some key facts – firstly and most importantly that our Government is committed to building a new hospital in Dunedin.
“In fact, we’ve significantly increased funding for New Dunedin Hospital by hundreds of millions of dollars. We promised $30 million during the campaign.
“We’ve set aside $290 million in government – but as you’re aware, an independent review has shown that the project has now become so troubled that this still isn’t enough.
“Last week’s was a difficult announcement but it had to be made to ensure we can support other important builds across the hospital system. Hospitals in Nelson, Whangārei, Hawkes Bay, Palmerston North and Tauranga could be at risk if Dunedin continues to go so far over budget. That’s not scaremongering as has been claimed  – it’s a financial reality.
“I want to assure the people of Dunedin and the south, and health workers, that Health New Zealand and ministers are fully committed to making sure we deliver long overdue solutions to their region’s health infrastructure.”
Many healthcare workers might remember other statements made by National Party politicians.
A list compiled by the Otago Daily Times newspaper included:
“The new Dunedin Hospital will be built better and sooner under National,” former Dunedin MP Michael Woodhouse said in an election flyer.
“We’re going to build this hospital back to the specification that was originally intended,” said Luxon, as opposition leader, in July 2023.
Even in June of this year, Reti said: “We will maintain what we said, that we would return and refit those parts of the new Dunedin Hospital back to its original description.”
On Friday morning, Te Whatu Ora/Health NZ referred Newsroom to a week-old press statement. In it, head of infrastructure delivery Blake Lepper said it welcomed recommendations of an independent review of the new Dunedin Hospital inpatient building by Robert Rust, the former chief executive of Health Infrastructure New South Wales.
“Health New Zealand is confident we have the right governance, leadership and expertise to deliver a modern hospital and health services for the people of Dunedin and the wider region within the new budget and driven by clinical needs and new models of care.”
Lequeux, the respiratory and sleep physician, says New Zealand has to have a serious conversation about healthcare.
“People are getting older, they’re getting sicknesses that they wouldn’t have had when they were younger, and they’re more difficult to treat because they’ve got more going on, and that costs.”
During the Covid-19 pandemic, the country showed that it cared, he says, when a lot of people sacrificed a lot for a smaller group of vulnerable people.
“I think we need to show we’re willing to sacrifice money for a health system, if that’s what we want. And if we don’t, well, then that’s fine. We have to find another way to sort it out, but a lot of people are going to suffer.”
Claire Ireland’s parting message to politicians is: “Please listen to the community, please listen to the clinicians, please listen to the people on the receiving end of healthcare, as well as those that are giving it in the south.
“And don’t be afraid of reversing your decision once you’ve heard what we’ve got to say.”