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Monday, 18 October 2010
Page: 490


Mr NEUMANN (5:49 PM) —I speak in support of the National Health Amendment (Pharmaceutical Benefits Scheme) Bill 2010. I listened to the member for Bowman talk about the great support that the previous Howard coalition government had for the PBS. The last time a coalition government was elected—in 1996—the coalition government immediately hit pensioners with an 18.5 per cent price hike for drugs listed in the PBS. That is exactly what they did. If those people opposite had been on this side and had been sitting here right here and now, we would have seen a $1.2 billion cut to the Pharmaceutical Benefits Scheme. That cut would have meant that pensioners and concession card holders would be slugged with, on average, an extra $28 per person per year in the cost of their prescription drugs.

So let us not come into this place and talk about the great support for the PBS from the coalition, because they have got form with respect to their years on the Treasury benches. Their proposal at the last election was simply to make the personal circumstances of pensioners and people on low incomes more difficult in dealing with sickness, ill health and disability by making it more costly for them to get access to the drugs they needed to alleviate the conditions and illnesses they suffered from. It is a bit of sanctimonious rhetoric coming from those opposite in their support for the PBS. All other Australian families, if the coalition were sitting here, would be slugged with an increased cost of about $4 per person per year for prescription drugs. This would rise to about $6 extra per person by 2013-14. So, the coalition has never been particularly supportive of the PBS. For the member for Bowman to talk about the benefits of reducing costs to Australian taxpayers, pensioners and concession card holders—to hear coalition members talking about that with their rhetoric which does not match their record—really sticks in my craw.

The purpose of this legislation is to make sure that we have a viable PBS system. This is important. It is part of the overall package of health and hospital reform that we are undertaking because we have a great challenge in this country. We have the third-longest life expectancy in the world. Our future generations, if they want to enjoy access to a world-class health system, need to get access to drugs, not just to doctors and allied health professionals. We want to make sure they have universal access to a decent healthcare and hospital system. It is important that we invest in primary health care. I commend the federal Labor government for their assistance in that regard with the money available to doctors. I am also pleased to see the new round of funding for regional health infrastructure from the Health and Hospitals Fund. In particular, the legislation that is before the House today deals with issues that maintain the viability, sustainability and security of the PBS.

Currently the PBS costs about $9 billion in the 2010-11 year and it is estimated that it will cost us $13 billion by 2018. So the taxpayer is the winner from the MOU which has been agreed to with Medicines Australia, which represents over 50 companies. About 86 per cent of total annual PBS expenditure goes to companies which produce drugs through Medicines Australia. We are talking about nearly 60 per cent of sales of off-patent medicines as well. So I thank Medicines Australia for their willingness to ensure price certainty and the reductions that will benefit not just the taxpayers of Australia but also the pensioners and concession card holders who really need access to the kinds of drugs that will make their lives better.

The bill sets out a new PBS pricing arrangement that aims at reducing the growth and the cost to the taxpayers. We want to make sure that taxpayers get access to funds which we can use to build roads, to improve schools and to improve our health system generally. The minister said in her second reading speech on 29 September 2010 that the purpose of this bill is:

… to achieve a more efficient and sustainable Pharmaceutical Benefits Scheme (PBS), better value for money for Australian taxpayers, and policy stability for the pharmaceutical sector.

I agree entirely with her assessment in that regard.

Over time we have seen the PBS price for multiple-brand medicines affect taxpayers in an adverse way. We think it is important that where we have multiple-brand medicines they reflect the price at which medicines are sold by suppliers into pharmacies. We think that information could be disclosed, we think that the PBS price will reduce the average price across all brands and we think that is fair and equitable to taxpayers. Price disclosure is critical. You cannot have a situation where the market is in that way secret, because it results in prices being higher than they otherwise would be. Consumers should not and will not have to pay extra money for the changes that are in this legislation. Indeed, we believe that some non-concessional consumers will also end up having to pay less.

We have talked about the savings. We are talking about hundreds of millions of dollars being saved directly by consumers from lower prices as the result of the changes in this legislation. This legislation is important in the sense that it does not affect a patient’s access to necessary medicines and neither will it affect a doctor’s ability to prescribe PBS medicines which are clinically appropriate to the condition that the patient suffers. The amendments also make it clear that price disclosure will allow the market forces to apply and play a part in pricing of PBS medicines. It always mystifies me that those opposite claim that they are the supporters of the market when the reality is that it is Labor governments which have supported small business operators and the market forces generally. Those opposite too-often side with big tobacco, big companies and big multinational endeavours, whereas we on this side of the chamber are the authors of trade practices legislation to help small business. We are the ones who are concerned about market share and market power. We are the ones concerned about making sure the market works better for taxpayers.

The bill sets out, as the minister has pointed out, that we think there will be an average price reduction of at least 23 per cent, to be achieved across all brands in the cycle. What that means is there will be a very large saving in the PBS and we think this will be market driven. The minister has pointed out, in a report to parliament on the 2007 PBS changes that the member for Bowman talked about, that consumers will benefit. She says that somewhere around $700 million will be saved over 10 years. That is roads, schools and health care. That is community infrastructure which can be used in communities across regional and rural Australia and in my electorate of Blair in South-East Queensland. We think that this legislation is a better deal for taxpayers and we think it is a better deal for consumers We think it is a better deal for pensioners and a better deal for non concessional card holders. We think it will mean that the market will play a role in reducing the cost of medicines for people. We also think that the pharmaceutical industry will play a role, as will the Pharmacy Guild of Australia, in achieving better outcomes for taxpayers and consumers.

It is my honour to represent the electorate of Blair. In the shopping centre where my electorate office is located in Brassall, the biggest suburb in my electorate, is a pharmacy. Every day as I walk past the pharmacy I see people going in and getting the medicines and tablets that they need each day. Every time I see that I think about the fact that those people need and deserve access to health care in a way that benefits them and their community. We should all thank the previous governments that had the wit, wisdom and foresight to bring in the Pharmaceutical Benefits Scheme, which means that medicines, tablets and assistance can be given to low-income earners, including in my electorate to the people of Brassall, who are able to purchase their medicines because of the PBS.