Prime Minister Christopher Luxon says the Dunedin Hospital project is frustrating. 

“We are very committed to building a hospital in Dunedin, don’t get me wrong. But we have got to do it within the $1.9 billion fiscal envelope, otherwise that means that we can’t do Whangarei, Tauranga, Palmerston North, Nelson and other regional hospitals,” Luxon told Newstalk ZB's Heather du Plessis-Allan. 

Luxon said the government was receiving advice on how to proceed, with an option to scale back the construction or staging the project. 

“We’ve seen cost creep, scope creep from the Labour Government - whether it’s been ferries, school buildings, and now the hospital.” 

Pressed on the Government’s spending priorities, Luxon said, “we have put almost $30 billion into health, so there’s plenty of money in health”. 

He said the Government needed to get better at spending on infrastructure. 

Pressed again on the Government’s proposal to spend several billion dollars on a single road in Wellington and whether spending had been appropriately prioritised, Luxon said “you just can’t have a project [the hospital] go from $1.2b when it started and heading out to $3b”. 

Luxon said he was aware of Treasury’s warning of a structural deficit: “We’ve got to get back to financial discipline. We’ve got to make sure we then set up for growth.” 

He said it was possible to “do more with less”. 

He also said his Government’s spending cuts were being done “in a sensible, balanced kind of way - we’re not throwing the country into austerity”. 

On his push for civil servants to return to the office, Luxon said he was not surprised at the level of flak from the workforce. 

“We want everyone in the office. It’s not an entitlement that you get to work from home.” 

He said he had moved into Premier House over the weekend. 

“We finally managed to get new paint, new curtains and new carpet.” 

Responding to a question about whether it was a cold house, Luxon said: “Well, I’ve got a jumper”. 

Regarding the capital gains on his apartment and media attention on it, Luxon said he had come to expect it. 

“If we’re going to criticise people for being successful, let’s be clear - I’m wealthy, I’m sorted.” 

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