The NSW Health Minister told a packed community forum last night that the government would do “everything they can” to return Northern Beaches Hospital public services back into public hands, but stopped well short of committing to taking over the hospital in its entirety.
The forum, attended by hundreds of concerned residents, comes amid ongoing criticism of the public-private partnership model that has plagued the hospital since it opened in 2018. Community members have repeatedly raised concerns about staffing shortages, long wait times, and the complex dual model that sees public patients treated alongside private patients under the same roof.
While a number of privately operated public services could return to public hands, it remains that most of the hospital is privately run, but with public components, and not within the government’s remit to take over. In the words of Pittwater MP Jacqui Scruby, who co-hosted the forum with Wakehurst MP Michael Regan – it’s very hard to unscramble an egg.
The hospital, located at Frenchs Forest, is part of a long-term (20 year) contract with the State Government to provide both public and private health services to the community. The operators are willing to return the public portion of operations, chiefly the emergency services, but are understood to be looking for or open to a buyer for the private hospital operations.
Speaking at the forum were government heavy-hitters NSW Treasurer Daniel Mookhey and NSW Health Minister Ryan Park; 400 stakeholders including community members attended.
Elouise and Danny Massa, the parents who lost their two-year-old son, Joe, following admission to the hospital, addressed the crowd.
“I could never have imagined in my wildest dreams that losing Joe, someone who we love beyond words, two months before he was about to turn two would give me so much courage,” Mrs Massa said at the public forum.
“But here we are. I have a fire in my belly that I will not allow to be extinguished… the structure and the systems at Northern Beaches Hospital does not work, and it has failed catastrophically. Joe’s case is not a one off. It isn’t isolated, and there is systemic change that needs to occur.”
A report by the NSW auditor-general has stated the hospital was not meeting key clinical outcomes and safety concerns had not been properly addressed.
Nurses and Midwives have also been striking since last year due to being underpaid and not having mandatory, safe nurse to patient ratios implemented.
Discussions points from the public forum
Why the State Government rejected Healthscope’s offer to return the public portion of the hospital in January?
The short answer: “It wasn’t real,” NSW Treasurer Mr Mookhey told everyone in attendance at the forum.
The long answer was that Healthscope had approached the State Government a few times to activate the termination clause in their contract, initially in 2023 after accumulating a $1.3 billion debt.
They originally wanted the government to pay them to leave the public sector as the private organisation was losing money fulfilling it’s contract obligations, according to Mr Mookhey. He continued, on the second time they didn’t want an exit, but a renegotiation that they no longer want to fulfil their contract and preferred to be paid like a private hospital while still operating public health.
Their position was allegedly one of “pay us if you want us to leave,” so the State didn’t take their proposal seriously.
Why Can’t The Public Private Partnership Legislation Banning PPP Be Implemented on Northern Beaches Hospital Immediately?
NSW Treasurer Mr Mookhey said the State Government was still working through “various complexities” given the contract is already in place.
Mr Regan added he has moved a ‘Compensation Bill’ to ensure the Northern Beaches Hospital would have no compensation from the State for backing out of their contract obligations.
Healthscope has previously stated they do not want a windfall gain from exiting the contract, but the Wakehurst MP says their attitude at the negotiating table suggests otherwise.
Will The State Government Buy Back The Private Sector Of The Hospital?
Mr Mookhey said he is unable to speak on behalf of Healthscope on this matter – who were not invited to the forum – but says they have no desire to exit the private component to his knowledge.
Following the announcement of their desire to provide the public component of the hospital back to the State Government in April 2025, Healthscope CEO Tino La Spina told Manly Observer their business could be looked at by potential sponsors.
“The restructure of Healthscope’s balance sheet is being worked through now with our lenders, and so that process is underway, and it would be premature to preempt where that goes, but, I see us putting the businesses being looked at by potential sponsors moving forward, and if someone takes a whole lot, then that private hospital would be in that,” Mr La Spina said.
The NSW Auditors-General Report Flags Concerning Issues Within The Hospital, How Will The Government Address this?
Concerns with the risk management systems, the electronic systems, as well as cost cutting and emergency department wait times issues were raised.
NSW Health Minister Mr Park said the Northern Sydney Local Health District are “micro-managing” the hospital’s clinical performance and reporting back to him with recommendations on a fortnightly basis.
The Clinical Excellence Commission is leading a review into the emergency department with a particular focus on paediatrics care.
Can The NSW Government Enforce Nurse To Patient Ratios At Northern Beaches Hospital?
Yes, if they take over the emergency department and the public component.
“yes we can, and yes we will,” Mr Park said.
However, this cannot be done until the new contract is finalised.
What systems are in place to ensure patient complaints and safety reports about Northern Beaches Hospital are meaningfully addressed under new changes?
Mr Park said complaints are still taken through the hospital’s management team with the Northern Sydney Local Health District monitoring their operations.
People can also make a complaint through the Healthcare Complaints Commission, that is an independent jurisdiction, independent of government.
Will the Minister guarantee that if State takes over the public beds on Northern Beaches there will be an increase in funding and no reduction in services?
“Obviously we’re not in a position yet where we are taking it over, but I can assure you, we’re not in the game of reducing services,” Mr Park said.
He added that the funding for the current services provided is to the discretion of Healthscope and the opposition government who were in power when the contract was made and that his government are currently ‘unpacking’ the contract with the current operator.
However, they are still adding and negotiating ‘top-up funds’ to Healthscope services at the hospital where needed.
“What we will do is make sure we have a look at the services we’re providing there and make sure that it is properly funded.”
Will the government control the hospital’s private and public sector if Healthscope sell their debt?
Mr Mookhey confirmed Healthscope is selling their debt to hedge funds on the secondary market and that they are monitoring those transactions.
They believe Australia’s ‘big four’ banks also own about 14 per cent of the debt.
He said there’s a ‘big chance’ Healthscope will go into insolvency which can trigger an ‘administration event’ which will then trigger the State’s response.
Will the wages and entitlements of the staff at Northern Beaches be safe if Healthscope sell their debt?
Mr Mookhey said this was also an event they were preparing for, but its an issue that would fall under the jurisdiction of the Federal government.
“It will be a rather large insolvency event for which federal laws and federal insurance and protection schemes are engaged,” he shared, “The best example I can give is that there is a federal guarantee scheme that is activated now for people who are working for Rex [airlines] and others as well. It’s not a great position to be in, I’ll be honest, right? But we were monitoring that.”
What interim measures can be put in place while the ownership exchange process proceeds to ensure that people can feel safe?
Mr Mookhey assured the State has provided top-up funding above the contract, which is negotiated every month to ensure critical standards are met through Healthscope systems.
Mr Park added they are working to get the contract finalised very quickly, and once they do, provided a guarantee that they are looking into implementing proper nurse to patient ratios.
He could not guarantee a 24/7 theatre team as this is not a feature every hospital has, and Northern Beaches may not fit the requirements to implement this.
What is the projected timeline for the hospital ownership handover?
“The truthful answer is, it’s inherently uncertain. We are working to get it resolved as quickly as possible,” Mr Mookhey stated.
He said the next milestone in place is on 26 May when the banks decide whether or not they enforce their loans, which could push Healthscope to insolvency.
There will also be more deliberations in Parliament – such as Mr Regan’s ‘Compensation Bill’ – which will give more certainty about the timeline going forward.
In safe hands
The hospital’s emergency department consultant Cliff Reid concluded the meeting wanting to assure attendees that despite broader issues, the hospital is being run by highly trained and dedicated staff.
“While we are all sick to our stomach about our failings with little Joe’s case, the fact is, we run a world class resuscitation facility. I’m only saying this because I don’t want people to go away from this meeting and have nightmares tonight. We are dedicated to looking after you,” he said.
“Trust us, we put you first. In the last six months, I’ve been invited to three different countries within Asia and Europe to talk about the development of resuscitation systems, because it’s recognised that ours at Northern Beaches are world renowned. We have a world class resuscitation room with dedicated staff.”
Written by Jack Kelly, edited by Kim Smee
