Mr ABBOTT (Minister for Health and Ageing) (4:04 PM) —I do not begrudge the member for Lalor her little moment of triumph. I suppose she is entitled to savour the fact that it was a moment of considerable embarrassment to me. I have said it before and let me say it again in front of my peers in this parliament: it was a moment of considerable embarrassment to me when the government decided to take the decision that it did. No-one enjoys making a commitment to do something which turns out not to be borne out by events. It was not the most golden moment in my political life—I certainly say that.

But the contention of members opposite is that when I made the rock solid, ironclad commitment that I did in the pre-election period I knew this to be false. Let me say again—and I will say it until I am blue in the face and I will say it until they are sick of hearing it—that when I made that statement I made it in good faith. I had absolutely not the slightest inkling that there would ever be any intention on the part of the government to change its position. Asked these questions, how could I have said otherwise, given that the government, as far as I was aware, had not the slightest plan or the slightest intention to change the safety net threshold?

Truth is important. Anyone who is untruthful has done a dishonourable thing, and people who are untruthful in public life have shamed their office and people who are untruthful in public life should pay a high political price. But people’s truthfulness should be judged by the state of their knowledge at the time. Let me repeat: when I made those pledges and when I made those commitments I had not the slightest inkling of a hint of a suspicion that anything was likely to change. As I said, there have been no lies told—not by me. I certainly accept that a pledge I made has not been honoured. I accept that, but I also point out that that pledge has been, as it were, trumped by an even higher pledge. That is the pledge which all governments must honour. That is the pledge that all responsible ministers must always live up to. That is the commitment to the long-term national interest of this country.

As the health minister, my fundamental commitment is to the strength and the sustainability of our Medicare system. What became obvious to the government in the post-election period was that this blow-out would be an ongoing blow-out. This was a government which had the power to make a change, and we believed that we therefore had the responsibility to make a change—not because we enjoy or in any way take pleasure in dishonouring pledges but because the highest duty of any government is to the long-term national interest. The highest responsibility that I have as health minister is to do everything I can to ensure the continued strength and sustainability of our Medicare system.

Let me point out again for the benefit of members opposite that I believe the Medicare safety net which the Howard government introduced last year is the most important structural improvement to our Medicare system since it was first introduced more than two decades ago. It is the most important structural improvement whether the thresholds are $300 or $700 or whether the thresholds are $500 or $1,000. It is the most important structural improvement because it is a fact of life that some people, too many people, face high out-of-pocket, out-of-hospital costs under the system which members opposite support but do not do anything to try to correct—as this government have with the Medicare safety net that we introduced last year. The difference between members on this side of the House and members on that side of the House is not that they support the thresholds that the Senate put in place last year of $300 and $700—thresholds that they opposed then—and that we support thresholds of $500 and $1,000, thresholds that we originally proposed when we first put forward this policy in November 2003; the difference is that we support a safety net and they do not. I know that the member for Lalor has a lot of front. She would have to have a lot of front to come in here and cry crocodile tears over adjustments to a safety net threshold when she would not have any safety net at all. She claims to be bleeding for people whom she would leave totally in the lurch.

Ms Gillard —I am an honest person.

Mr ABBOTT —No honest person would go and metaphorically embrace people and say, ‘You’ve been ripped off. Labor will help you,’ when Labor would rip them off even more. That is what she would do—she would take away the safety net altogether. She would deprive people who face high out-of-pocket costs because of the system that she says she supports of any help at all—help which they deserve and help which they have thanks to the policies of the Howard government.

Let me explain for the benefit of the member for Lalor precisely what has happened. Back in March of last year when we first agreed with Independent senators that there would be $300 and $700 safety net thresholds it was costed at $440 million over the relevant forward estimates period. Those costings were based on Medicare data from 2001. It was the most recent available data. Yes, we had later data on the gap payments; but we did not have later data on how those gap payments precisely applied to different population groups. We did not have that data then when we did the costing. There were some things that we did not anticipate. We did not anticipate almost universal safety net registration. We did not anticipate that some specialist groups—with, no doubt, their patients’ best interests at heart—would shift some costs from non-MBS items to MBS items so that their patients could take better advantage of the safety net. We did not anticipate that, but it became clear shortly after the safety net began to operate that there would be an increase in costs.

In the pre-election financial outlook we made it clear that the first-year cost of the safety net would be considerably in excess of what was originally estimated. I think from memory that it had more than doubled. We made very clear in the Charter of Budget Honesty that the four-year cost of the safety net had at that stage blown out to something like $1.2 billion. The latest estimate of the four-year cost of the safety net at the existing thresholds is something like $1.4 billion. For the benefit of the House, let me point out that in calendar year 2004 this safety net cost $166 million and that those well-deserved benefits were provided to 1.95 million Australians. I am proud that the Howard government have paid those almost two million Australians, needy Australians who faced high out-of-pocket costs, some $166 million. Because I want the system to be sustainable, we are going to adjust the thresholds—but we are not going to take away the safety net. As a result of the higher safety net thresholds which this government have announced, the cost of the safety net over the forward estimates period will still be some $1.1 billion. So this is hardly the cutting and slashing of a hard-hearted, skinflint government. In calendar year 2006 under the Howard government’s somewhat revised safety net we estimate that 1.5 million Australians are going to benefit from higher Medicare rebates. I want to let each one of those people know now that, if members opposite had their way, they would not get anything. That is $1.1 billion that would be ripped off 1.5 million Australians who face high out-of-pocket costs for their health care.

The member for Lalor and her colleagues can huff and puff, they can shout and yell, but the Australian people will not take them seriously and they will have no credibility or standing on this issue until they say clearly and unambiguously, ‘We support the safety net, and we support it so much that we’ll actually go back to the $300 and $700 safety net thresholds.’

Let me simply indicate for the benefit of members opposite that this is a government which believes in Medicare. Just to mention a few of the things that this government has done since October 2003—I am talking here not about words but about deeds—this government has spent $3.8 billion on ‘Strengthening Medicare’, $2.2 billion on the new aged care package, $1 billion plus in new life-saving and life-enhancing drugs put onto the PBS and $2 billion plus in 100 per cent Medicare. This government’s policies have got bulk-billing rates up. This government’s policies have raised bulk-billing rates for GP consultations from about two in three to well over seven in 10, and the rate is four out of five for people over 65. It has not done that by trying to bully the medical profession into bulk-billing. It has done it by providing correct incentives, which have benefited those who get bulk-billed and those who do not get bulk-billed by their doctor. Since October 2003 the government has invested more than $11 billion in Medicare over the forward estimates period, and that is why I said earlier this year, I said late last year and I say again today that the Howard government is the best friend that Medicare has ever had, notwithstanding the minor adjustment to the safety net thresholds which members opposite are so indignant about.

The member for Lalor is right, to this extent at least: people expect governments to keep their commitments. This government has never broken the ultimate trust of the Australian people because it has never shirked the hard decisions necessary to ensure that this country stays strong and that the fundamental institutions of this country, including Medicare, remain viable for the long term. The Australian people expect governments to keep their commitments, and I would say that the Australian people well and truly judged that this was a government that they could trust to keep this commitment on election day. Just as the people expect governments to keep commitments, the people expect oppositions to develop a few commitments.

I should close these brief comments on budget day, when the Howard government will demonstrate yet again tonight that it has the vision and the courage necessary to take Australia forward, by simply saying to members opposite: where are your commitments? Where are your principles? Where are your beliefs? We have had a lot of—

Opposition members interjecting—

Mr ABBOTT —They talk about telling the truth. Let me ask whether Rodney Cavalier was telling the truth when he said recently:

Ms Gillard interjecting—

Mr ABBOTT —She is saying Rodney Cavalier is pathetic. That is what she is saying. Was he telling the truth or not? I think he was. You cannot necessarily believe people when they slag off their opponents, but you can believe them when they are talking about each other because they have no incentive to lie when they are talking about themselves! It is high time that members opposite give up their huffing and puffing, look into their souls, decide what they believe and stand up for something at long last.