“We're just getting started,” Dunedin's mayor says after a massive crowd that was estimated at 35,000 turned up to protest against possible cuts to hospital redevelopment.

Dunedin's Octagon packed with people on Saturday calling for the government to keep its promise to build the new Dunedin Hospital with no cuts.

It is now in doubt after the government says it will not put more money into the project and is considering advice about possible cuts, delays and developing the old site after more budget blowouts.

Dunedin Mayor Jules Radich called it the biggest protest in the city of about 134,000 in years.

Protesters reject any cuts to the new Dunedin Hospital. – RNZ / Tess Brunton

"Today up to 35,000 people from across the South have come together on Dunedin's streets to express their outrage at proposed cuts to our new regional hospital," he said in a statement.

"This is the biggest protest in Dunedin in decades, and together we've sent a powerful message to government that we're not going accept broken promises and a hospital that fails the people of our region.

"This is no longer a Dunedin issue or even a Southern issue. This is now a national issue, shining a spotlight on the government's health funding and priorities, and they can't simply ignore us.

"We're not going away. In fact, we're just getting started."

Many of the protesters spoken to by RNZ were angry.

Prostate cancer survivor Robert Scott, who lives near Port Chalmers, said the government needed to spend the money and build the hospital right.

"It made a huge difference for me being able to access the care. I could go in each day and get my treatment, every day for a month. It was only a 10-minute drive from my house," Scott said.

He wanted to see no cuts approved for the hospital.

"The government is slowly stripping away the funding for everything and the hospital is another example. It's just for balancing books."

Dunedin resident Jan said the southern region relied on the hospital and she felt it had been ignored by the government.

Protesters rally in Dunedin. – RNZ / Tess Brunton

"These are people's lives we're talking about. This is Dunedin, Otago and Southland's future, they can afford to build it ... They can afford to build a new med school in the Waikato, which is not required. They can afford so many other things," she said.

Her husband needed the hospital for brain haemorrhage and brain cancer, and while the service was outstanding, she said it was obvious then that it was so rundown.

"His life depended on it. We couldn't have gotten to Christchurch in time. It covers such a huge area ... this is a hospital for a really significant region."

Mayor Radich said he understood the feelings of the community.

"The fact the government now wants to downscale such a critical facility for the South is an outrage, and people are right to be angry," Radich said.

Dunedin resident Judith said attending the protest was a no brainer.

"How could you not? This has just been the most disgusting display," she said.

"We are all so angry about ... even the mere mention of the fact that they were going to try and renovate this hospital - the existing hospital - is just so absurd."

This was a multi-generational hospital for a region and it was what the communities needed, she said.

Health Minister Shane Reti said the government remained committed to building a new hospital in Dunedin, but recognised the passion of today's protesters.

"There's always been an extremely high degree of public interest in this large and complex piece of infrastructure, and while this week's announcement was not an easy one to make, it had to be done to ensure we can deliver in Dunedin, and across the rest of the country's hospital network as well," Reti said.

"I want to assure the people of Dunedin and the south that Health New Zealand and ministers are fully committed to making sure we deliver long overdue solutions to their region's health infrastructure needs."