Finance Minister Grant Robertson says he won't use surplus funds to increase the pay offer to nurses, but grants they have a right to strike. So where does that leave them?
"That's the nature of negotiations," Mr Robertson told The AM Show on Wednesday. "We believe an offer like this wouldn't normally generate a strike."
The July 12 nurses' strike is going ahead after members of the New Zealand Nurses organisation (NZNO) voted to reject the latest pay offer from district health boards (DHBs). But the Government isn't willing to offer more money.
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"I have to balance the books. I have a lot of competing needs to look out for. I really value the work that nurses are doing and that's why there's a half a billion dollar offer on the table," Mr Robertson said.
The Government has doubled the original offer on the table for nurses to half a billion dollars. The deal adds 500 nurses and "puts a pathway toward a pay equity settlement on the table," Mr Robertson said. "We have already significantly increased the offer from what was there."
"Right now the facilitation between the DHBs and the nurses is taking place. Obviously everyone is hoping for the best there. But clearly the strike notice is in and the DHBs have been preparing and making sure the contingency plans are in place if that does go ahead."
The first strike planned for 5 July was called off after the DHBs made a revised offer. But nurses have voted to strike on Thursday after declining the offer.
The latest offer includes a December 2019 date for any pay equity payments to come into effect. It also includes $38 million in new funding for DHBs to immediately start hiring around 500 new nurses to address lack of staff.
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New Zealand nurses start on $49,499 and under the proposed deal that would be increased to $50,932. Nurses get a pay increase every year from there, subject to good performance, and then earn $67,000 after five years. The rejected deal offered a new top salary of $77,386.
Acting Prime Minister Winston Peters has said the Government doesn't have the money to make a new pay offer to nurses. He said it's not that the Government isn't willing to offer it - there just isn't enough money to increase the offer.
Mr Robertson says the previous Government neglected the health sector and that "nurses understand [the Government] can't make up for nine years of neglect in one go". He said the Government is committed to a long-term development of the nursing workforce.
But the Government is sitting on a surplus nearly $1 billion ahead of expectations, figures from the nine months to March show, which has raised questions over why the Government isn't willing to cough up more money for the nurses.
Mr Robertson said surpluses need to be saved for a rainy day. He said surpluses "allow [the Government] to make sure we can make the investments in big infrastructure projects."
Mr Peters said the Government has inherited the Mycoplasma bovis crisis and the PSA outbreak affecting the kiwifruit industry, the combined cost of which is expected to cost in excess of $1.2 billion.
National's health spokesperson Michael Woodhouse says the Government has "completely lost control".
Hundreds of surgeries and appointments that haven't already been moved will be shifted to prepare for the 24-hour nurses strike on Thursday.