Nurses brought the pickets to rally for better pay at Middlemore Hospital.

ANALYSIS: Has our health system been underfunded?

Revelations about toxic mould and sewage in the walls of Middlemore Hospital have re-ignited debate.

The Labour-led Government say National did not put enough money into health during their nine years in power.

JARRED WILLIAMSON/STUFF Toxic mould in the walls of Middlemore Hospital have re-ignited the debate over funding in the health system.

The Council of Trade Unions' estimated that funding for health in the 2017 Budget was $1.4B short of where it needed to be to maintain funding at 2009/10 levels - once cost increases, population growth and the effects of the aging population were taken into account.

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National's response has been to point to consistent year-on-year increases in health spending. And it's true that spending on health has gone up every year.

But that does not automatically mean that the increases are keeping pace with the demands on the system.

There are other ways to look at health spending that give a more relative sense of how it has been tracking.

One is health spending as a proportion of the total economic output, or GDP.

The advantage of this approach, is that it accounts for population growth, economic growth and inflation. It also tells us what proportion of our income as a nation we are dedicating to public health.

It fell every year between 2013 and 2017, but is still above where it was for most of the Labour Government's term. It's worth noting that all Government spending fell as a share of GDP under National.

A 2017 analysis by New Zealand Institute of Economic Research (NZIER) and Victoria University found that real (inflation-adjusted) health spending per capita has flattened off since 2009/10, after increasing every year between 2001 and 2009.

They also found that the percentage change in year-on-year real per capita health spending has been variable in the 2010s - falling in 2010/11 and 2014/15. According to a report by Victoria University this variability is "... something that the [health] sector no doubt struggles with in terms of planning, with local peaks often around election years."

INTERNATIONAL COMPARISONS

OECD data shows that New Zealand's spend on public health as a percentage of GDP puts it in the middle of the pack. The OECD figure of 7.4 per cent includes health spending by ACC, which is not accounted for in the previous graph.

Our per capita spending is slightly below the OECD average, but health outcomes are good by OECD standards.

HOW MUCH SHOULD WE SPEND ON HEALTH?

There is no 'right' amount is when it comes to the health budget. The question of how much to spend on health is a question of priorities.

Are we happy with the level of service provided by the public health system? If the answer is no, then what are we prepared to sacrifice to make it better?

Beyond doing better with what we have - something the last National-led Government repeatedly pushed for - the options are: Take money from another area of Government spending, raise more taxes or borrow money.

Each of these in turn comes with its own consequences, such as reduced services somewhere else, increased debt or higher Government spending as a proportion of GDP.