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New Zealand's 21 District Health Boards (DHBs) had a combined deficit of $12.5 million in the March quarter, Statistics New Zealand said today.

This is lower than the deficit of $21.8m in the December quarter, but contrasts with a $29.3m surplus in same quarter last year.

Total DHB expenditure fell by $17.6m, to $2.28 billion, in the March quarter from December.

The major expense components are the direct provision of $1.3 billion for public hospital and health services (HHS), and the $967.5m purchase of medical services from non-government providers and inter-DHB services.

Total operating expenses of the HHS providers were 0.4 per cent lower than in the December quarter, but 8.7 per cent higher than the same quarter last year.

Employee costs, the key expense item, were up 0.7 per cent (to $835.6m) compared with the December quarter. This was more than offset by a fall in direct medical supplies and all other expenses.

Total DHB revenue fell to $2.27 billion, mainly due to other funding from government, with funding from the Ministry of Health increasing by only $900,000 to $1.90 billion compared with the December quarter.

Total DHB investment in fixed assets was $88.7m in the March 2006 quarter, down 8.4 per cent on the December quarter.

For March year, DHBs spent $367.5m on additions to fixed assets, down 0.8 per cent on the previous 12 months.