Pursuant to section 63 of the Pae Ora (Healthy Futures) Act 2022 (“Act”), the Minister of Health gives notice of this appointment of:

Evan Davies

as Crown Manager to the Health New Zealand New Dunedin Hospital Inpatient Building Project.

The appointment as Crown Manager starts on 16 June 2025. The Minister of Health will undertake a review of the continued need for this appointment every twelve months.

Background

The New Dunedin Hospital (NDH) project is the largest health infrastructure investment in New Zealand’s history and will replace the current aging Dunedin Hospital. The budget for construction projects is $1.88 billion, representing nearly 30% of the entire Health New Zealand physical infrastructure investment portfolio.

The physical construction of the NDH programme consists of enabling works, an outpatient building, and an inpatient building. The inpatient building is the largest project and is about to commence procurement for the main build.

Health New Zealand has struggled to maintain momentum on the project and identify a path forward following consistent cost pressures and extensions to the estimated delivery timeframes for the project. These delays have also created delays and additional costs.

The Minister of Health believes on reasonable grounds the New Dunedin Hospital project poses a risk to the operation or long-term viability of Health New Zealand given:

• the size and scale of the project;
• the fiscal risks arising from the cost pressures on the project; and
• the likely impact on health services if those cost pressures are not adequately addressed and delivery is further delayed.

After considering these issues, the Minister of Health has determined that Ministerial intervention is warranted. These matters constitute a significant problem, one that Health New Zealand is unlikely to be able to address without the appointment of a Crown Manager.

The Minister of Health considers a Crown Manager is required to ensure that Health New Zealand meets its obligations to deliver the New Dunedin Hospital Inpatient Building project. Pursuant to section 63 of the Act, a Crown Manager is being appointed to deliver the New Dunedin Hospital Inpatient Building project.

Section 63(2) of the Act requires the Minister of Health to publish in the New Zealand Gazette the functions of Health New Zealand that are to be performed by the Crown Manager, any conditions subject to which the Crown Manager must perform those functions, and any matters about which the Crown Manager must advise Health New Zealand.

Extent of Authority

The key functions of the Crown Manager include:

• overseeing the delivery of the New Dunedin Hospital project and ensuring all appropriate measures are in place to support delivery in line with the agreed contractual arrangements, including strengthened client-facing leadership in Health New Zealand for this project.
• deliver the construction scope and programme as it relates to the inpatient building (including reinstatement of additional capacity).
• agreeing the approach for early works packages and procurement of long-lead items to maintain momentum on the programme.
• negotiating the final contract for the main works package of the inpatient building and delivery of the Implementation Business Case to Cabinet for approval within the next three months.

Term of the Appointment

The term of the Crown Manager appointment starts on 16 June 2025. The Minister of Health will undertake a review of the continued need for this appointment every twelve months.

The Minister of Health may end the appointment period early by way of written notice, if the Minister is satisfied that the appointment is no longer required.

Remuneration and costs

The remuneration of the Crown Manager will be paid by Health New Zealand pursuant to section 63(8) of the Act. Remuneration will be paid in accordance with the Cabinet Fees Framework (CO (22) 2) at a rate of $2,500 a day. The Crown Manager is responsible for ensuring any expenses claimed are reasonable and necessary.

Reporting

The Crown Manager must report, as appropriate, to the Minister of Health monthly on the progress in fulfilling the Terms of Reference. The Crown Manager must provide a final report to the Minister of Health as soon as practicable after the management period ends. In addition, the Crown Manager must report on any potential problems that remain or any new related problems that have emerged. The final report may make further recommendations to the Minister of Health.

Dated at Wellington this 16th day of June 2025.

Hon SIMEON BROWN, Minister of Health.