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Exercise New Zealand Takes Its Prevention Case to Parliament

The organization proposes a four-point plan to increase physical activity in the country.

BY JIM SCHMALTZ

Beddie

Ahead of the November 7 general election in New Zealand, Exercise New Zealand (Exercise NZ) has proposed to the country’s Parliament a four-point plan to incentivize an increase in physical activity levels to save on healthcare costs to the public health system.

According to Richard Beddie, chief executive of Exercise NZ, the organization has strong data to make its case. In August, Exercise NZ published Physical Activity and Prevention in Aotearoa New Zealand, a white paper focused entirely on physical activity and prevention (Aotearoa is the Māori word for New Zealand).

The Exercise NZ research, created in partnership with Deloitte, quantifies the cost of physical inactivity to New Zealand’s public health system, much like the seminal HFA research report, Reversing the Physical Inactivity Crisis: Fitness Affordability as Strategic Policy, created with Portas Consulting.

The price is steep. Citing Deloitte analysis, the paper puts the direct cost of inactivity to public healthcare at about NZ$600 million (US$342.93 million) a year, with GDP losses of roughly NZ$2.53 billion (US$1.45 billion) annually. Only about 46% of adults meet World Health Organization and New Zealand Ministry of Health activity guidelines, and activity is lowest among Māori and Pacific communities, older adults, and low-income households. Deloitte estimates that each inactive person who becomes active generates about NZ$2,750 (US$1,572) a year in economic benefit.

Awareness, the paper argues, isn’t the issue. More than 90% of New Zealanders understand that exercise improves health, yet activity levels keep falling.

“We need to prove to the non-exercise industry that we are robust in terms of our standards. And that’s why the number one policy we asked for was actually making registration of exercise professionals compulsory.” • Richard Beddie

The Four Proposals Submitted to Parliament

Exercise NZ proposes four reforms that it describes as low cost and practical:

Accreditation for trainers and physiotherapists. Mandatory registration of exercise professionals with the New Zealand Register of Exercise Professionals (REPs).

Insurance policy. Integration of registered exercise professionals into rehabilitation pathways funded by the Accident Compensation Corporation (ACC), the country’s no-fault government injury insurer.

Tax policy: A targeted Fringe Benefit Tax (FBT) exemption for employer-supported physical activity.

Children’s health: One hour of physical activity every school day.

The proposal targets a familiar gap: prescribed rehabilitation exercise that patients never complete. Under the plan, a physiotherapist treating a soft-tissue injury could refer the patient to a registered exercise professional, who would supervise the program under clinical direction.

“We wouldn’t be prescribing, but we would be involved in the delivery of the rehab or treatment,” Beddie says.

He calls it a referral pathway, the mechanism missing from most exercise-as-preventive-healthcare efforts. A doctor simply telling a patient to exercise, he says, is “[a] bit like saying eat your vegetables. It’s like, well, thank you for that information, but it doesn’t really help me.”

ACC approval, physiotherapist buy-in, and the referral mechanism are still to be worked out, likely through a pilot. Being able to fill demand is not a problem, Beddie adds: “We have massive capacity every day.”

The Tax Question

The FBT proposal carries the paper’s clearest numbers. Under current guidance from Inland Revenue, the government department that advises on tax policy, employer-paid gym memberships generally attract the tax. Assuming an average membership of NZ$20 (US$11.43) a week and a 28% corporate tax rate, the annex estimates an exemption would cost about NZ$291,000 (US$166,321) in forgone revenue for every 1,000 newly active employees, against roughly NZ$589,000 (US$336,640) in combined health savings and added government revenue, based on Deloitte modeling.

Government agencies have been receptive without giving firm commitments. Beddie recently met with officials from Inland Revenue, after the minister of revenue directed them to discuss the proposal.

“They could have [just] been very polite or just ignored it, which is what most government agencies do,” he said. “They didn’t.”

The unknown is whether subsidized memberships would attract new exercisers or simply reward existing ones. “The question is, would anyone extra go? And our hypothesis is yes, of course they would, because you’ve now reduced the cost barrier,” he said.

Exercise NZ plans to survey the staff at large employers to measure that outcome and return to officials with more specific data.

Anticipating Regulatory Action

Beddie believes that policymakers may force regulation on the fitness industry due to some lingering credibility issues. That’s why the four-point proposal includes a “regulate us” mechanism through REPs. This would avoid a new regulatory body being established by the government that may not understand industry issues and priorities. Being a member of REPs is currently voluntary.

“We provide massive health benefits, but we are not the health sector,” he explains. “We need to prove to the non-exercise industry that we are robust in terms of our standards. And that’s why the number one policy we asked for was actually making registration of exercise professionals compulsory.”

Policymakers find the request interesting precisely because it runs against type. “We are saying, ‘Please regulate us,’ which is a bit unusual,” Beddie said. The paper argues that mandatory registration would formalize an existing system rather than create a new regulator, giving government agencies the workforce assurance they need to commission services.

Built With Industry Support

The fourth proposal would require an hour of daily activity that goes beyond organized sport, including active play, strength and skill work, classroom movement breaks, active travel, and partnerships with registered professionals. According to Sport New Zealand estimates cited in the report, only about 57% of children ages 5 to 18 meet the recommended 60 minutes a day.

Beddie stresses that the paper belongs to the industry. Drafts were presented at the organization’s annual roadshow, and members voted on each initiative. Every proposal drew more than 80% support and all were approved.

Asked how other federations can make a difference in changing public policy, Beddie says: “First, make sure you do it with the industry and not to the industry. Second, don’t pick proposals because you think you’ll get them passed; pick them because you think they’re important.”

Beddie concedes that some of the proposals may not succeed, but the two key government agencies involved have agreed to keep talking. “It’s not a hard no,” he adds.

The goal, he insists, is not to fill gyms, even if that is a byproduct.

“The problem that we’re solving is increasing physical activity levels in our country,” he says. “And that’s one that it’s hard to argue with.”

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