The ACT Party is proposing to increase the proportion of health budget spent on Pharmac by one percent a year, to bring New Zealand in line with Australia and closer to the OECD average.

The policy would see Pharmac's budget rise to 12 percent of the total health spend by 2033.

Currently, New Zealand spends 4.9 percent of the health budget on medicines, well below the OECD average of 13.3 percent.

ACT leader David Seymour, who currently holds ministerial responsibility for Pharmac, told RNZ he had spent the last three years in government trying to increase Pharmac's budget.

"Pharmac is punished for being tougher on its costs than anyone else in the healthcare system. We need to give them a break."

The uplift, he said, would enable Pharmac to fund more medicines on its Options for Investment list.

There were currently 139 applications on the wishlist, which are all pharmaceuticals Pharmac would fund if it had the money to.

In the 2026 Budget, the health system received a $1.5 billion funding uplift, but Seymour said Pharmac got just $13.5 million.

He was hoping for cross-party support for the policy.

"It is actually an achievable, realistic, and timely way to approach a problem that everyone admits, but no one has ever quite got on top of."

Despite being the minister, he had not pitched the idea to his coalition partners.

"I have asked for more modest increases in medicines funding, which have been rejected. The logic that I'm producing now, I believe, is unassailable as a way of persuading anyone who's in government - and let's be really honest, between now and 2033 there'll probably be several different people in government - this is a logic that anyone can sign up to."

Seymour said he was proud of the work he had done with Pharmac and MedSafe to get more medicines, but it had only gone so far.

"You could see this as a final jigsaw piece in the work that I've done over the last three years."

At the lower end of ACT's costings, it used the Treasury's 2025 Long-term Fiscal Model, while at the upper end it applied the Treasury's 2025 Overlapping Generations model's projected health-spending share to nominal GDP forecasts and projections.

This meant in 2027/28, overall health spending would be between $33.4 billion and $36.6 billion. With the medicines share increasing from 5 percent to 6 percent, it would put medicine expenditure between $2 billion and $2.2 billion.

By 2033/34, with a projected health expenditure of $44.9 billion to $51 billion, and a 12 percent medicines share, medicine expenditure would be between $5.4 billion and $6.1 billion.