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Health Minister David Cunliffe has appointed a Crown monitor and new chairman to the crisis-hit Capital and Coast District Health Board in a bid to stabilise its ailing condition.
But Mr Cunliffe said the new-look board would need to make visible progress within four months to avoid being sacked and replaced by a commissioner.
The DHB, which runs Wellington Hospital, has been severely criticised for its ballooning budget deficit, friction between management and staff, its treatment of new mothers, its difficulty running some services such as child cancer treatment and a string of medical mishaps involving the death of some patients.
Mr Cunliffe yesterday appointed Sir John Anderson - TVNZ's chairman since 2005 - as the DHB's new chairman in a bid to arrest its slide.
He replaces Judith Aitken, who remains on the board after being re-elected in October.
Mr Cunliffe also appointed Northland DHB's current director of medical services, Dr Ian Brown, as a Crown monitor - reporting directly to the Health Minister on the board's affairs.
It is the first time a Crown monitor has been appointed to a DHB since the boards were established in 2001.
Mr Cunliffe said the situation at the DHB, which has projected a $48 million deficit by 2009, was "serious" and he was looking for the board to stabilise its problems.
He said the DHB's crisis was the result of a "perfect storm" of issues, which came as management and staff were dealing with the complex process of a new regional hospital being built on the existing hospital site.
He would not identify what he believed the DHB needed to do to improve the situation, but said he expected the new-look board to develop a recovery plan and improve relations between board, management and staff in its first four months.
He said the Government continued to talk to the DHB over its ballooning deficit and a cash injection was possible at a later stage.
But he said that would not happen until there was a better analysis of both the deficit and the DHB's wider problems.
"This does not mean they have an open chequebook. It means that this DHB is expected to resolve the issues it has and that the Government will be working with them to ensure that all solutions are sustainable."
Mr Cunliffe said Sir John, who he described as one of New Zealand's "pre-eminent businessmen" and a "passionate Wellingtonian", had needed little convincing to take up the job.
He said Ms Aitken had also taken his decision well. He said it was important she stayed on to ensure there was some continuity on the board and institutional knowledge of its problems.
He said for that reason former union boss Ken Douglas would also remain as deputy chair.
Mr Cunliffe also appointed Peter Douglas and Selwyn Katene to the board - rounding out the Crown's four appointments.
Opposition parties have called for Mr Cunliffe to sack the board and appoint a commissioner.
Act MP Heather Roy yesterday said the DHB needed an independent and experienced troubleshooter with the ability to form his or her own team.
Instead it had kept most of the board members who had presided over the current crisis for the past three years.
A Crown monitor also raised the prospect of political meddling, she said.
National's health spokesman, Tony Ryall, said Sir John was going to have a difficult time dealing with the board's problems.
He did not think appointing a Crown monitor would do much good, because the board had been under a monitoring regime since May and there had been no improvement in its situation.
- NZPA
