Senator TAMBLING (9:56 PM) —First I will address the two issues raised by Senator Lees. Her first question was in regard to unknown gaps. I am advised that that particular area would be treated as for any other debts. The second question posed was whether the government would agree to any increases on top of what may already be contemplated. Again, I am advised that we do not anticipate that any increases would be in the same proportion as those of previous years. In fact, Senator Harradine's amendment opens the area for negotiation to militate against this.

Senator Margetts raised the question of how the impact would influence states and the agreements. Certainly, the recently negotiated arrangements with the states have been important. With regard to the public health systems area, I would remind Senator Margetts that the Howard government has provided the biggest ever increase in funding for public health systems: over $7.2 billion, an increase of 19 per cent. In forecasting that into the future, we have to be very mindful of the impact on national budgets. Any improvement in the area of private health insurance will militate against those future imposts on states.