Mr SIDEBOTTOM (9:19 PM) —Hundreds of north-west coast families in my electorate of Braddon got a rude shock last week when they received letters advising them of huge increases in health insurance premiums—in some cases, jumps of up to 69 per cent. This follows the Howard government's announcement that there would be a 7.4 per cent increase in the amount of money that Australia's 44 health funds could levy members. However, in many cases these premiums have risen considerably more. Most fund members took this to mean that there would be a 7.4 per cent rise in their premiums. Instead, the health funds targeted the products which were costing them the most in a bid to keep up with rising medical costs.

My office—and this is no doubt shared by many other offices of members in this House—has received more than 30 calls from shocked and angry customers. Some of these people will have to pay an extra $1,000 a year for private health insurance, and some even more. One of my constituents, Mr Conlon of West Street, Burnie, received a letter from the Government Employees Health Fund stating that his contribution per month would rise from $197.60 to $309.40. This is totally outrageous. It is a 56.5 per cent increase—or, quite simply, he will have to pay an extra $1,341.60 each year.

Most constituents complained of increases ranging from $574 a year to $1,077. Not only have these people been hit with huge increases but most have complained that their private health fund has reduced their extent of coverage. For example, as from 1 April when the new premiums apply, health fund members such as Mrs Dick from Burnie will have to pay $250 a day for the first two days in hospital. This hardly seems fair given the huge increases. Indeed, Mrs Dick's premium will rise by nearly 57 per cent, or $22 per fortnight. This is a slap in the face to Australians with private health insurance who were told by John Howard in the run-up to the last election that premiums would fall under his government. The increase will also cost taxpayers more than $170 million extra each year through the government's 30 per cent private health insurance rebate.

In the run-up to the 2001 election, the Prime Minister said that his government's policies would lead to reduced premiums and that private health insurance would be more affordable and attractive to consumers, but since that election the government has approved increases in premiums of more than 14 per cent. This year's increase of 7.4 per cent comes on top of last year's average increase of 6.9 per cent. Together with last year's increases and the decision by some funds to abandon discounts for regular and up-front payments, many Australians will be paying over $1,000 more than they paid before the 2001 election for their premiums. For example, Mrs Power of Devonport will face a 52 per cent increase in premiums, which will cost her over $1,000 extra per year. The average increase in private health insurance premiums of 7.4 per cent will cost taxpayers, as I mentioned before, more than $170 million a year, or $680 million over four years. However, with the actual increases shown to be between 20 per cent and 69 per cent, this could cost taxpayers billions.

For every dollar that premiums rise, taxpayers will contribute 30c. Mrs Sproule of Burnie will be up for a 40 per cent increase of $764 per annum; Mr Brack of South Rianna will be up for a 20.7 per cent premium increase; Mr T. Greene of Somerset will be up for a 20.3 per cent increase; and Burnie pensioner Hedley Charles's premium will rise from $355 to $386 per quarter. Mr Ken Hegar of my home town of Forth is outraged by the premium increases that have occurred this year and last year and by the fact that, with all this, gap payments are still not covered for most premium holders. Once again, the government has used the nation's proper concern with matters of national security to try to conceal the additional financial burden that families will have to bear if they elect to maintain their private health insurance.