What will Hodgson do?

Paula Oliver in the NZ Herald correctly surmises that Pete Hodgson has the dilemma of sacking or backing the Auckland DHB Chairs.

If you do not sack them, then its one more tale of no accountability for avoidable blunders.

But there is considerable danger in sacking them. Amongst professional directors (those whose skills are advanced enough that they are sought by companies for the value they can add at a governance level) DHBs are already widely regarded as an appointment to be avoided at all costs. Their mix of appointed and elected members is a recipe for disaster, their lack of true independence from the central bureaucracy and the fact the Government makes all the big decisions on funding, yet leaves it to DHBs to take the blame for service, all make them highly unattractive. Hence the number of top class directors on DHB boards is already very low. Other crown boards such as SOEs do not have the same problems and have some incredible talent on them.

Now if you sack the three Chairs, this will dry up the talent supply even more. This will impact on DHB performance (governance does matter) and the problems get worse.

The real solution is to change the model, but I doubt the Government has the resolve to do that.