Hon Tony Ryall
Minister of Health
14 May 2012
Budget 2012: Prescription Charges Help Fund Health
Health Minister Tony Ryall today announced the Government will increase the $3 prescription charge to $5 per item up to
a maximum of 20 items from 1 January 2013. The savings will be reinvested in the health sector.
“The National-led Government is committed to protecting and growing public health services,” Mr Ryall said at a
pre-Budget announcement with Prime Minister John Key.
“Despite tight financial times and what will be a zero Budget on 24 May, health will receive a big funding boost, which
will come from savings within health and across the Government’s accounts.
“This new spending will help meet cost pressures and fund new initiatives in Health, four of which we are announcing
“The Government is expecting Health to deliver some savings as it works to target investment where it is most needed,
control debt and bring its books back into surplus in 2014/15.
“The savings from these prescription changes amount to $20 million in the first year and $40 million in subsequent
years,” Mr Ryall says.
Most New Zealanders now pay $3 per prescription item up to a maximum of 20 items per family per year, after which items
are free. This charge will increase to $5 per item on 1 January 2013, up to the 20 item maximum a year.
“The change means no person or family need pay more than an extra $40 per year for their prescription items,” Mr Ryall
“This is the first time the prescription charge has been increased in 20 years. Importantly, there will continue to be
no charge for under- sixes.
“As is the case now, after 20 prescriptions individuals and families get a safety net card (pharmaceutical subsidy card)
that ensures all further prescriptions are at no charge for the rest of that year.
“Currently, because of this safety net, about a third of all prescriptions are at no charge to the patient.
“It’s important that to receive these subsidies, families get a pharmaceutical subsidy card. The simplest way to ensure
you receive a card once you’ve reached the threshold, is to work closely with your local pharmacy.”
New Zealand continues to have low prescription charges compared to almost every other developed country.
In Australia, for example, the standard prescription charge is up to NZ$45 and in England it’s around NZ$16. In
Australia people on low incomes pay around NZ$7.45 per item. In Finland, there is an annual limit of around NZ$1,107 per
patient, after which there is a flat fee of around NZ$2.50 per medicine item.