Analysis by Deloitte has shown more than $3bn in untapped funding between 2019 and 2023 due to ‘inaccurate’ data capturing from hospitals.
The NSW government could easily afford a 15% pay rise for nurses and midwives if it moved to recuperate its losses in unclaimed Commonwealth funding, according to a new report from the NSW Nurses and Midwives Association.
Financial analysis undertaken by Deloitte to support NSWNMA’s 2024 award claim revealed the NSW government had accumulated $3.28 billion in cumulative losses over the past five years as a result of repeatedly missing its Commonwealth funding cap.
Using data from National Health Funding Body annual reports and AIHW data from 2018 to 2023, the report showed $1.5 billion was forgone in the 2023 financial year alone, based on the difference between the government’s actual funding entitlement of $6.9 billion versus a potential entitlement of $8.4 billion if it had achieved its maximum funding cap between 2019 and 2023.
More than $880 million would be saved by adopting a range of “technical efficiency” and “allocative efficiency” programs recommended by NSWNMA, while transitioning patients from acute to sub-acute models of care would unlock an additional $142 million in savings, the report said.
The report also outlined potential savings generated by adopting three key initiatives aimed at reducing costs and improving retention and recruitment rates across the state’s nursing and midwifery workforce.
These included a 15% wage increase across the workforce, anticipated to produce an additional $539 million in economic gain, as well as finalising the rollout of safe staffing levels across all “agreed clinical areas” and conversion of assistant in nursing positions to supernumerary roles, estimated to save $54 million in overtime and agency fees and provide an additional $130 million through new job creation.
According to NSWNMA general secretary Shaye Candish, the report clearly demonstrated how the government could afford to not only substantially improve wages but also increase the number of nursing and midwifery positions available by eradicating “systemic inefficiencies” within the state’s health system.
“We know patients are getter sicker and presenting to NSW public hospitals acutely unwell and in need of care, but the data being captured by NSW Health is not reflecting the treatment that is provided, resulting in available Commonwealth funding not being claimed,” said Ms Candish.
“According to Deloitte’s financial analysis, the potential revenue and savings to be made would cover the cost of implementing our 2024 claim, given the state government has already budgeted for a 3% per year public sector wages offer.
“Our workforce has been decimated by more than a decade of wage suppression by previous governments.
“If the state government is serious about retaining skilled and experienced staff, and attracting nurses and midwives back into these professions, it must pay wages that reflect the vital work they do shift after shift.”
The full business case is available here.