CASE STUDY

Health infrastructure – Investment Strategy and Investment Management Framework

Health NZ (interim agency inside Ministry of Health) – now Te Whatu Ora – Health NZ

 

The opportunity

In April 2021 the Government announced the decision to amalgamate all 20 District Health Boards (DHBs) into a single organisation – Health NZ. The primary purpose was to drive delivery of a nationally coordinated and consistent NZ Health Plan for the delivery of health services, and best practice models of healthcare.

 

Infrastructure is required to support the delivery of many critical health services, particularly across the national public hospital estate. Prior to the formation of Health NZ, some work had commenced to provide centralised support to major projects where DHB funding was insufficient (via the Health Capital Envelope). With the decision to form Health NZ, the opportunity presented to design and implement a nationally consistent, best practice approach to investment and asset management.

What we did

Phase 1

Initially we were hired to undertake a review of the state of play of strategies, systems, policies and processes for health infrastructure investment and asset management across the public sector. This provided a stake in the ground to understand what already existed, and what needed to be developed. The next step was to develop and consult on a “Infrastructure for Health Investment Strategy” – a high level document describing the key issues, drivers and objectives for investment in health infrastructure.

In parallel we assisted with developing a range of briefings for Ministers, senior executives and the incoming interim Board of Health NZ – as well as responding to activities happening outside of the Ministry of Health, including at Te Waihanga – Infrastructure Commission, and the Health NZ Establishment Agency inside DPMC.

Phase 2

The next step following approval of the Investment Strategy was to develop an Investment Management Framework (IMF), providing the overarching structure for how the investment approval and delivery lifecycle would work in practice, keeping in mind phases of activity (to identify, define, design and deliver portfolios, programme and projects(“P3”)), phase-gates and the documents and activities necessary to support these. We worked the team at Health NZ and with other consultants to design the IMF, and then to incorporate within this the process for identifying and prioritising potential investments and the business case framework describing the types of business cases required, thresholds and stage-gates.

Phase 3

With the conceptual IMF agreed, the next step involved a series of workshops to develop and agree Board-level policies covering:

  • Board expectations

  • P3 Definitions

  • Contribution to He Korowai Oranga – the Māori Health Strategy

  • P3 Governance

  • Asset management

  • Investment approvals

  • Investment evaluation

In parallel with this we developed a guidance pack for the completion of business cases for low risk, low cost investments, ensuring consistency with the guidance developed for single stage business cases.

The outcome

The work completed provided Health NZ with a sound platform to progress investment decision-making for health infrastructure as a new organisation. A suite of materials were available day 1 for Te Whatu Ora, making it more likely that the right investments will be made in the right sort of infrastructure to support the best health outcomes for the people and communities of New Zealand.

Our team