Economic impact of Havelock North gastro outbreak reaches $21m

The costs of the Havelock North water crisis included purchasing bottled water, such as that which was delivered by Jo Haynes to Duart Rest Home in August last year. Photo/Paul Taylor

The total economic cost of the Havelock North gastro outbreak in August last year has been estimated at more than $21 million, according to a report released last month.

Commissioned by the Ministry of Health, the analysis was conducted by Sapere Research Group and carried out through a combination of desktop research and interviews.

It had previously been determined that 5540 people contracted gastroenteritis during the outbreak, and campylobacter was a contributing factor to the deaths of two people, with the third yet to be ruled on by the coroner.

Of the total $21 million, the report attributed $18.5 million to non-health related costs, including $12 million for household inconvenience due to having to boil water, buy bottled water, and take time off from normal activities due to the outbreak.

The cost to local government was estimated at $4.1 million, $1.6 million of that spent on investigating the outbreak, and almost $1.7 million spent after the outbreak, primarily on the Government water inquiry, including external legal fees and internal staff costs, the report said.

Up to March 31 this year, $630,000 had been spent by local government on chlorination and testing of the water supply, as well as ongoing water quality monitoring.

The report found businesses incurred costs of $1.3 million, $180,000 made up of assistance provided by the Hastings District Council to affected businesses.

Fifty-nine per cent of business costs were borne by food and beverage businesses, and 25 per cent by accommodation providers. The rest were made up of retail, services, early childhood education and the primary education sectors.

Central government was reported to have spent $506,000 and non-government organisations (NGOs), such as St John, Red Cross, Healthline and the NZ Fire Service, $134, 000.

As with local government, the lion's share of central government costs also came in after the outbreak, dominated by legal fees and the cost of experts' reports for the inquiry.

Illness-related costs made up 12 per cent of the total ($2.5 million), almost two thirds of which ($1.6 million) was the monetised calculation of the impact on quality and length of life, or disability.

The remaining health costs covered the impact on general practices, Hawke's Bay hospital, including the Emergency Department, and other Hawke's Bay DHB costs such as legal fees and the cost of staff sick leave.

Given the inquiry was still under way, the report noted that costs related to this and any outcomes were bound to continue to rise significantly.