Fairfax Media reported on Wednesday that the state government had abandoned its plan for a public-private partnership for the health facility, which will replace the existing Maitland Hospital.

Instead, the government will seek a not-for-profit organisation as a partner.

While the Australian Medical Association welcomed the news, Maitland MP Jenny Aitchison, the Health Services Union and the NSW Nurses and Midwives Association labelled the decision “privatisation”.

Ms Aitchison said she had several questions about governance, reporting, decision-making and the capacity for expansion.

“I think it’s important to note that this is still privatisation, as not-for-profits take on these hospitals to make a surplus,” she said.

“Calvary Mater [Hospital, Newcastle] is a legacy model. This will be a unique model, so it’s very important to make sure there is enormous clarity around the terms.

“The government still has to go through an expressions of interest process and so we don’t even know which operators will put their hand up. 

“Why doesn’t Maitland, and indeed the Lower Hunter, deserve a public hospital when we are the fastest growing local government area outside Sydney at 15.5 per cent, according to the Census?”

Health Minister Brad Hazzard said, under the new plan, the hospital would “absolutely” be held to Hunter New England Heath policy and guidelines.

“What is being delivered is a first class hospital delivering public services free to public patients, that is the bottom line,” he said.

“Whatever not-for-profit provider joins with the government will be required by their contractual terms to operate within a strict clinical and non-clinical performance regime.

“The history of not-for-profit operators is they generally do an extraordinary job for the public, they have a non-profit motive that is wanting to do good.”

Health Services Union NSW secretary Gerard Hayes said the union viewed the government’s decision with “a very healthy dose of scepticism”.

“While this may be better than a multinational corporation running the hospital, it is not good enough,” he said.

“The state government needs to explain why it’s conducting a not-for-profit privatisation in Maitland while allowing for full public investment at Wyong and Tweed.”

The NSW Nurses and Midwives’ Association said it was concerned the new model would not meet the needs of the community or staff.