Mana Party leader Hone Harawira says proposed increases to the cost of prescriptions "will lead to children dying".

Prescription charges will be raised from $3 to $5 next year in a move critics say will disproportionately affect lower-income groups, the elderly and the chronically ill.

The Government has announced it will make the first increase in prescription cost in 20 years at next week's budget to fund reinvestment in the health sector in lean economic times.

Health Minister Tony Ryall said the $5 cost would be applied to the first 20 items of medicine per family each year, so no family would pay more than $100 a year for their prescription costs.


The current maximum for prescription costs was $60 a year.

The revenue gained from the price rise would be used to increase the number of elective operations and scans and to improve cancer services.


Harawira told Radio New Zealand the increase will prove to be lethal.

"Doctors are saying right now that children's health is being threatened by the price of medicine now. You have to assume that if Government raises that price then children will die as a result of that measure," Mr Harawira told Morning Report.

"I don't believe that any Government could be so callous.

Harawira said parents are already not taking their children to the doctor and getting them medicine due to the cost.

"Absolutely I think that these measures, although it is going to be difficult to prove, will lead to children dying, through the inability of their parents to afford the charges for medicine that are being proposed by this National/Maori Party Government.


Harawira accused the Prime Minister of being "bloody blind if he thinks this is not going to impact on poor people".

"Every price rise impacts poor people in a far greater way than it does people on the kinds of levels of income that him and his mates are on. So yes it is going to hurt every poor person in this country - Maori, Pacific and Pakeha."

The Medical Association said the funding would reduce waiting times for cancer treatment and said it believed the prescription price rise was "unlikely to be a barrier for most".


But some healthcare experts in poorer areas were more concerned.

Dr Fionna Bell, former clinical director of the country's biggest Pacific primary health organisation TaPasefika, said even small changes such as $2 could change the behaviour of poorer patients.

"Those are the same families who, to try and make rent, miss out on fruit and veges. People will give up on trying to get medication for chronic conditions or antibiotic courses just because they want to make sure that they can feed the little ones in the house first.

"You do have to find the money for cancer services somehow and reduce expenses ... but it doesn't make any sense because hospitalisations for, say, skin infections are very expensive for the country as opposed to antibiotics for $3."

The Government said the price rises affected all New Zealanders and therefore they did not discriminate.

But Otago University research published in 2010 found that Pacific Island and Maori people were almost three times as likely as Pakeha to fail to collect prescribed medicines because of the cost.


Asked how poorer patients might cope with the change, Mr Ryall said people who struggled with their medical costs could approach Work and Income New Zealand for support.

The Opposition said the changes shuffled funding away from the most vulnerable sections of society.

Labour health spokeswoman Maryan Street said: "The announcement glosses over the fact that if the Government put aside more funding for preventative programmes, fewer New Zealanders would need ongoing healthcare."

Prime Minister John Key said that as in the previous two budgets, the health sector would get the biggest slice of the spending. Because the Government had promised a "zero Budget" on May 24, this spending would come from cuts within the Ministry of Health and other departments.

Mr Ryall announced $101 million in new funding, which included 4000 more elective operations a year and a new IT system to help shorten waiting times for CT and MRI scans and colonoscopies.

To improve cancer services, 40 new dedicated nurses would be employed to care for cancer patients throughout their treatment.

Dedicated nurses had been trialled in Christchurch, and their introduction was a response to research which showed cancer patients saw up to 28 doctors during their care.