Media release: ‘Insufficient, poorly targeted’: Budget 2026 not enough to improve health

Despite the Government portraying health as the big winner from its Budget 2026, the reality is that most of the new funding will simply maintain a health system already struggling to meet the needs of many New Zealanders, according to Paula Lorgelly, Professor of Health Economics at the University of Auckland.

The Budget 2026 directs 70% of all new government spending to health, increasing Vote Health to $34.2 billion next year and providing $5.8 billion in new funding over four years. However, Prof Lorgelly says the package falls short of what is needed to address years of underinvestment and improve access to care.

Writing for the Public Health Communication Centre Briefing, Prof Lorgelly says on paper, the health sector appears to be the biggest winner in this Budget. “However, when we look beyond the headline figures, much of the funding is being absorbed by rising costs, demographic pressures and inflation,”  

Prof Lorgelly says the health system is under severe strain. Around 6% of New Zealanders are not enrolled with a primary care provider, a fifth of those enrolled struggle to access GP appointments, emergency departments face unprecedented demand, specialist referrals are often declined and waiting times for treatment remain long.

"Many New Zealanders are already finding it difficult to access timely healthcare. Māori, Pacific peoples and disabled people face even greater barriers and poorer health outcomes."

The Briefing notes that recent estimates suggest an additional $1.405 billion per year is needed simply to maintain current services. The Budget provides funding that is close to this figure but still falls short, while remaining well below estimates of what would be needed to address longstanding underfunding and rebuild capacity across the health system.

A major concern identified in the Briefing is the lack of dedicated investment in primary care and preventive interventions.

"International evidence consistently shows that primary care delivers some of the highest returns on health investment. Every dollar spent in primary care can generate substantial savings elsewhere in the system. Yet there is no dedicated new funding for primary care in this Budget," says Prof Lorgelly.

New spending within Primary, Community, Public and Population Health Services is largely directed toward ambulance services and extending bowel cancer screening, rather than strengthening general practice, community-based care and core prevention measures.

While Budget 2026 includes significant capital investment in hospital infrastructure and IT, Professor Lorgelly cautions that buildings and technology alone will not improve health outcomes.

"New wards, upgraded facilities and stronger digital systems are important investments. But infrastructure only delivers benefits if there are enough doctors, nurses and other health professionals available to provide care."

Professor Lorgelly says Budget 2026 contains some positive initiatives and will deliver benefits for some communities, but it does not provide the targeted investment needed to improve health system performance over the long term.

"The Budget is a start in some areas, but it remains insufficient and poorly targeted. Without stronger investment in primary care and prevention, New Zealand is unlikely to see meaningful improvements in access, equity or health outcomes."