Opposition parties are warning the rise in prescription charges will hit low-income families and the elderly hard, and could have deadly consequences.

The Government yesterday announced prescription costs would rise from $3 an item to $5 on subsidised drugs, in a bid to save $40 million a year.

The savings would be used to help pay for a boost in the number of specialist cancer nurses and 4000 more operations a year.

NZ First leader Winston Peters said today the Government was trying to "fob off" the increase as modest.

"But it's a lot for people on fixed incomes. It's a lot for people who have heavy medication requirements, and a lot of people do.

"For them it's going to be seriously tough because incomes are not going up and costs are right across the board and this is just one more of them."

The Government said the changes would benefit the health system but they would make many people's health worse, particularly the elderly and children over six, he said.

"There are people who aren't getting medication now because of costs."

Mana Party leader Hone Harawira said poor families with many children were already forced to get the cheapest medicine available.

"It's not necessarily the right medicine but it's the cheapest. When their child looks like they're better, they stop giving them the medicine, they keep it in the cupboard and they build up a bank of medicine because they just can't afford to keep going to the doctor."

Health problems were exacerbated for families in substandard housing who couldn't afford decent food, he said.

"Anything which is going to make that worse is going to put lives in serious jeopardy in poor communities and particularly poor Maori communities."

Labour health spokeswoman Maryan Street said increasing prescription prices to subsidise other health services punished the wrong people.

"What [Health Minister] Tony Ryall is doing is asking low and middle-income New Zealanders, who already struggle to meet their basic needs, to cough up more cash at the counter to subsidise treatment for others."

Peters said National didn't signal the rise in prescription charges before the election and the Government hadn't consulted on the changes.

However, Ryall today said Government's didn't always set out their entire programme at elections.

"We are doing a lot of things we didn't necessarily campaign on at the election," he told Radio New Zealand.

The rise in prescription costs was the first increase in 20 years and was essentially an inflation adjustment.

"The money is being reinvested in the health system so we can provide the critical improved services that patients are looking for."

All families, including low-income families, were dealing with cost of living increases.

"If things are putting people in a position where they can't afford these kind of things, they can go and see Work and Income."

Many primary health organisations also had funds for people who couldn't afford health care.

"All people are finding financial challenges at the moment, that's the reason why the Government is working hard to make sure their tax dollars do the best they can."

Pharmacy Guild president Karen Crisp said the increase was expected, as current funding was unsustainable.

"For those patients who genuinely cannot afford the co-payment, there is help available from Work and Income NZ, or the primary health organisations. This means that no patient ... needs to go without their medicines because they cannot afford them."

Raewyn Fox, of Family Budgeting Services, said the higher charge might only be an extra $2 an item, but the rise came on top of other increases.

"All added together they are significant."

MORE USER PAYS

With the announcement of the hike the Government was signalling a step up in user pays.

Asked if there would be more such tradeoffs or user charges in next week's Budget, Key said there would not be "a huge number" but confirmed there would be some "minor changes".

The Government has already signalled a likely increase in the amount some families will have to pay for early childhood education. It has not spelt out those changes but says they are aimed at lifting participation of Maori and Pacific children.

It has also announced changes to student allowances and student loans and there is also expected to be a big hike in excise on cigarettes.

In last year's Budget, the Government made cuts to KiwiSaver. It also trimmed about $200 million a year from the $2.6 billion Working for Families.

Key said yesterday that the Government was spending "billions and billions" over the next four years in critical areas such as health, education and science and innovation.

Because the Government was committed to a zero Budget, that had to be matched by "either an increase in charging or a reduction in expenditure".

- © Fairfax NZ News