University freeloads hospital tenancy for 30 years

Parties seek to cure informal relationship, and herpes

The Southern District Health Board is seeking to formalise a lease agreement with the University for the Medical Faculty’s use of Dunedin Hospital buildings amidst pressure to upgrade Hospital facilities. According to the ODT, SDHB Chief Executive Carole Heatley indicated in a report to the Board that “there have been numerous historical discussions on this topic [but] … there is no lease agreement despite past efforts to formalise this relationship.”

The University currently uses 20 per cent of the hospital and associated buildings free of charge, owing to the fact that 30 years ago it paid for 20 per cent of the cost of developing the original Hospital ward block. A University spokesperson told Critic that the University has a “long-standing and close” relationship with the SDHB. The spokesperson said the two parties are “currently working through the details of the space agreements,” but information wouldn’t be available until discussions were completed.

Critic spoke with SDHB Executive Director of Finance, Peter Beirne, about the matter. “The university has always contributed to the outgoings of the buildings it occupies, such as energy, cleaning and engineering services. The intent of a lease is to formalise the relationship which currently exists.” While the ODT reported Heatley as saying the board were seeking “market value rents” for the use of the space, Beirne indicated that there is “no intention to charge market rent. The desire to formalise the existing relationship is what is being sought by the parties.”

He added that the SDHB has been able to attract “highly skilled clinicians” as a result of its relationship with the Dunedin School of Medicine, and that the population served by the SDHB has “benefited from University-led research including medical research, as has the population of New Zealand as a whole.”

Heatley also told the ODT that significant time had passed since the University’s contribution to the Hospital development, but that the relationship between the two institutions needs to be “fair and equal.”

One second-year medical student said it seemed “a bit strange” if the Hospital were to start charging rent now. “This is an arrangement that’s been happening for a very long time and we’ve always used this amount of space, so it seems a bit strange for it to be a problem now. You’d think that a hospital which relies on the training of new medical professionals to sustain it would be happy to offer up their facilities for that purpose.”
This article first appeared in Issue 8, 2014.
Posted 4:31pm Sunday 13th April 2014 by Nina Harrap.