Thousands have marched through the streets of Dunedin outraged by government plans to downgrade the city’s new hospital project due to budget blowouts.

On Thursday, Infrastructure Minister Chris Bishop and Health Minister Shane Reti announced that the cost of the project has escalated to an estimated $3 billion from an original estimate of between $1.2b-$1.4b in 2017.

An independent review, commissioned by the Government, concluded that the project could not proceed within the current budget, they said.

Hours after the Government’s announcement, Dunedin Mayor Jules Radich condemned the proposal, saying it was “completely unacceptable for Dunedin and the people of the South”.

He warned that the Government’s plans amount to “clinical cuts and a downgrade” of the critical regional hospital for the lower South Island.

“These cuts represent a broken promise by this Government,” he said.

“They do a complete disservice to the people of our region, and I believe we’re right to be outraged.”

Radich repeated that message when addressing the crowd gathered today.

“People from across the southern region are outraged by the prospect of cuts to our hospital. We’re here to send a clear message to the Government to keep their promise.”

He quoted Prime Minister Christopher Luxon previously stating that a National government would deliver the hospital as originally promised.

”It all comes down to a simple message, build it once and build it right.”

Margot Lemm (right) and Helen Veitch. Photo / Ben Tomsett

Green Party MP Scott Willis (left) and Jenna Packer. Photo / Ben Tomsett

Southern District Health Board worker Stephen Packer. Photo / Ben Tomsett

Local Labour MP Rachael Brooking criticised the Government, calling the move “outrageous”, and accusing them of prioritising tax cuts for landlords over hospital funding.

Meanwhile, Tracey McLellan, Labour’s health infrastructure spokesperson, called the revised plan a “sterling disappointment”, pointing out that Labour’s original plan had provided additional capacity for mental health and MRI facilities.

Bishop defended the decision, stating that the original projections were based on faulty information and assured the public that Dunedin would still receive a significant $1.88b investment.

However, protesters are expected to make their voices heard, demanding more from the Government to ensure that Dunedin’s hospital is built as promised.

Thousands are expected to join today's protest. Photo / Ben Tomsett

Otago Polytechnic and the University of Otago also voiced serious worries regarding the impact on healthcare training.

Otago Polytechnic’s executive director Dr Megan Pōtiki said that downgrading the hospital could jeopardise Dunedin’s reputation as a premier destination for health education.

The polytechnic relies heavily on the hospital for clinical placements that are crucial for students in nursing and midwifery programmes.

“Reductions in hospital services would significantly limit hands-on learning opportunities, which could ultimately affect student readiness for the workforce,” she said.

Dunedin's Forsyth Barr Stadium lit in red in support of today's march against proposed cuts to the new hospital. Photo / Ben Tomsett

University of Otago vice-chancellor Grant Robertson echoed these concerns, saying Dunedin Hospital played a vital role in training healthcare professionals nationwide.

He said that the current shortage of trained doctors, nurses and other healthcare workers could be exacerbated by fewer clinical placements.

Acting head of Otago Polytechnic’s College of Health, Dr Hayden Croft, said that students might be forced to seek qualifications elsewhere, potentially leading to a local healthcare talent shortage.

Both institutions called for the government to consider the long-term implications of reduced hospital services on both education and health outcomes.

The march begins at the Otago Dental School today at 12pm and ends in the Octagon where speeches will take place.

Ben Tomsett is a Multimedia Journalist for the New Zealand Herald, based in Dunedin.