A new health centre bringing GPs, outpatient clinics and dental services under one roof will be built in Kawakawa after an announcement this morning of $7.1 million in Government funding.

The outpatients and primary care facility will complete the rebuild of Bay of Islands Hospital, the first phase of which was opened in September with a price tag of $14m.

Today's announcement puts to rest uncertainty over the rebuild, which was originally a joint venture between the Northland District Health Board and Ngāti Hine Health Trust.

An artist's impression of the new primary care facility (right), alongside the new (middle) and old hospital buildings (left). Photo / Supplied
An artist's impression of the new primary care facility (right), alongside the new (middle) and old hospital buildings (left). Photo / Supplied

The health board built a new accident and emergency centre and a 20-bed medical ward, while the trust was to have built the adjoining health centre. Earlier this year, however, Ngāti Hine pulled out of the project, citing spiralling construction costs.

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Health board chief executive Nick Chamberlain said he was thrilled for the people of the Mid North.

The health centre had to be scaled back from the original Ngāti Hine Health Trust design, with about half the area and fewer services. However, it would still house all Kawakawa and Moerewa GPs, outpatient clinics, oral health and possibly renal (kidney) services.

Ngāti Hine Health Trust would still be the main tenant and was working closely with the health board on the plans, Chamberlain said. He hoped design tenders would be completed in the first half of 2019 and the centre would open in late 2020.

Health Minister David Clark said having GPs and other primary care clinicians in one place would make it easier for locals to get the most appropriate care and treatment.

''I have often spoken about the challenges we face in the health system and the need to change how we deliver services to those in most need. Making the most of primary care is a key part of this,'' he said.

He welcomed the involvement of Ngāti Hine, which was ''exactly the sort of local collaboration'' needed to improve health outcomes for their people.

"Health statistics tell us that we have a lot of work to do to improve outcomes for the people of the North. This development is a clear signal that the Government is committed to doing just that," Clark said.

When Clark visited Kawakawa in September, health board bosses put the case for the new health centre to him, but at that time he would commit publicly only to funding it within the term of the current Government.

Chamberlain was pleased the decision had come so soon and intended to move the project along as quickly as possible, before building costs rose any more. All health board sites around the district had now had significant upgrades and investment.

There was no word yet on funding for a rebuild of Whangārei Hospital.

''One step at a time,'' he said.