But introduction of the payment plan couldn't go ahead because all the area health services are still operating.

The shared services group was expected to achieve procurement savings of A$100 million, according to the audit report. The most complaints about NSW Health come from suppliers who are not paid on time.

The report said not paying suppliers in a timely manner impacts on price, and each area service is forced to manage local complaints. Such non payment also hinders each area's ability to negotiate better deals in the long term.

Current funding processes to each area is another problem identified in the report. One area health service said it was given A$10 million to spend in the last two weeks of the financial year, adding that this had occurred on a number of occasions.

NSW Health has an annual budget of A$10 billion and 10,000 staff.