Commissioner’s ‘very deep disappointment’ at Health NZ boss

Tension between Health NZ’s Government-appointed commissioner and its incumbent boss has reaching breaking point.
Auckland-based Te Whatu Ora leadership gave a presentation to about 90 staff about upcoming changes, on Tuesday this week. Chief executive Margie Apa was dialled in on the meeting.
At the meeting, management indicated the fulltime-equivalent positions of about 470 specialists and 1491 nurses would be reviewed. There were also 338 allied health employees, and 2193 management, admin and support staff. In total, 4492 FTEs.
The meeting became fiery, perhaps predictably.
That conflagration spread through Health NZ, quickly reaching the eyes and ears of the commissioner, Dr Lester Levy. He received a worried text message from a senior doctor, and felt forced to issue an internal statement to staff.
“Earlier today, a staff member presented some information to a meeting around potential cost savings in Hospital and Specialist Services,” he wrote. “For the avoidance of doubt, what was presented is in direct conflict with our thinking and should be dismissed.”
That internal memo was leaked to Newsroom that night.
On Wednesday morning, we asked Dr Levy whether he’d had words with Apa about what was said at the meeting – and about comments on a slide that had been attributed to her and hospital and specialist services director Fionnagh Dougan (who’s already serving out notice after her role was disestablished).
His responses, by text message and in a phone call, are quoted at length.
“I was completely unaware of this until I heard about it yesterday,” he tells Newsroom. “It was apparently a presentation by a manager who was trying to make a comparison of the amount of savings required by comparing it to FTE. In my view it was a misguided way of trying to make an analogy and is unacceptable.
He says he’s briefed the minister’s office, and “there will be consequences”.
“Furthermore, I was deeply disappointed as this was in direct conflict with the commitments that I have made that the clinical frontline will not be cut or reduced which I fully stand by.”
“No explanation can satisfy me … How could somebody even make a slide like that? We’re trying to do the opposite. We’re trying to strengthen the front line. I can’t even explain it to you, I mean, this is just so bizarre.”
One source tells Newsroom that the slide wasn’t an error – the cuts it described were indeed planned, and at least one region of the organisation had already begun making plans to consult and implement the changes. But nobody had told the commissioner.
“There were no controls, and really any senior manager who was in the room should have immediately reacted and asked to take the slides down, because they know perfectly well that that it was absolutely against the direction that they have been given,” Levy says. “As I said to you earlier, explanation does nothing for me. I’m just totally dissatisfied with the whole thing.
“One of the things you always think about in this situation: is this reluctance, is this resistance, is this sabotage? It could be none, or any of the above. I don’t really care, I’m just moving on with everything we’re doing, which is a big reset in the organisation.”
Levy adds: “It is entirely unacceptable and should never have been conceived of, let alone presented and discussed. I have spoken to Margie as the chief executive making it very clear this is unacceptable and is not to be ever repeated. I find this whole episode deeply disappointing and I look forward to the deputy chief executives starting and the new paradigm being implemented.”“In my view this episode is symptomatic of the centralised top-down approach which we are about to replace with a devolved bottom-up approach.”
Levy says his “reset” of Te Whatu Ora will result in big changes to the way the organisation has worked. “Devolution of decision making and enhanced clinical involvement will fundamentally change the organisation and its culture, in my view for the better.”
It’s almost unprecedented in recent history for a public sector chair or commissioner to speak publicly in such scathing terms of their chief executive – and this is the chief executive of the biggest government agency this country has ever seen.
When Health Minister Dr Shane Reti first parachuted in the commissioner, barely three weeks ago, Levy and Apa spoke to media together at North Shore Hospital. That day, noting that Apa had had two years to get spending within constraints but hadn’t done so –Newsroom asked, did he have confidence in her, long term?
“Fair question,” he replied. “We’ll see how it goes. Right at the moment, do I have confidence in Margie to do what we need to do? Yes, I do, because she’s already doing it, and that’s what we need to happen.”
It was hardly a reassuring response for the chief executive who was standing at his side. At that moment, he had confidence in her – but that could quickly change.
Newsroom asks him again, this morning: does he have confidence in Margie Apa? 
“I’ve said, I’ve got confidence in her to do what needs to be done,” he reiterates. “But very soon, we will have performance criteria in place for all managers, and confidence will just be related to performance to the targets. Because it’s all been too loose, as far as I’m concerned.”
In his emailed internal memo, Levy tells staff that he and his deputy commissioners are “absolutely committed to a strong clinical frontline” to drive better health outcomes for New Zealanders.
“The clinical frontline is key to helping ensure faster and easier access to healthcare for people, wherever they live. The clinical frontline will not be cut or reduced, and our plans are to strengthen it.”
He acknowledges Health NZ has a serious financial problem and must now live within its budget – but not at the expense of the clinical frontline. “These staff play a critical and valued role in lifting productivity to better respond to acute care demand and deliver more planned care. We know that’s what New Zealanders expect and need us to do.”