The Canterbury District Health Board is being asked to cut costs to reduce a ballooning deficit.

Photo: RNZ / Andrew Collins

The recommendation has come in a report commissioned by the Ministry of Health, which predicted the board would post a $38 million deficit this financial year.

The report blamed spending on $1 billion worth of new hospital facilities, including Burwood, the Acute Services Building and the outpatients facility.

It recommended tighter financial management, a review of spending and looking at leasing buildings instead of owning them.

If the board did not follow its advice, the report predicted a deficit of $46m by 2021.