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Wednesday, 28 May 2003
Page: 15147


Dr SOUTHCOTT (10:20 AM) —I rise to speak on the Health Care (Appropriation) Amendment Bill 2003. The three cornerstones of Medicare have always been free access to public hospitals, the Pharmaceutical Benefits Scheme and a universal Medicare rebate. In looking back to the early speeches of Dr Blewett, Brian Howe and so on, you see that the notion that we would have universal bulk-billing was never part of the original Medicare. If you look back to the whole period of the 1980s, when the rate of bulk-billing was at 50 per cent, 60 per cent and so on, it was thought that that was a pretty good rate. At least 32 per cent of services are not bulk-billed, which means that probably a much greater percentage of the population is not being bulk-billed. Because of an ideological obsession, the Labor Party are insisting that these people not being bulk-billed spend their time filling out forms, carrying around their receipt in their wallets and visiting Medicare offices. It would be much more convenient—for that group, at least—to be able to pay the difference with nothing more to do and nothing more to pay.

It seems to me that the Labor Party always want to have it both ways. We have seen that they want to spend more, tax less and create bigger surpluses. We have seen that in a lot of the rhetoric. When the Leader of the Opposition was talking about a $1 increase in the copayment for the Pharmaceutical Benefits Scheme, he was not talking about a $1 increase but a 30 per cent increase. It was a massive increase! But a $4 a week tax cut—that is, $208 a year—was so small as to be laughed away.

We see it in this debate as well. The essence of the argument from the Labor state premiers and health ministers is that this is a cut in funding. They are saying that because it is less than the amount that appeared in the forward estimates. The problem is that you cannot have it both ways. When we came to office in 1996, the Labor Party had left zero in the forward estimates for the Commonwealth dental health scheme—zero. When we abolished that scheme, that was a `cut' to the scheme. If we are going to base these agreements on what is in the forward estimates, why have an agreement at all? Why not leave it up to Treasury and its projections? But we do have agreements: we have agreements between the Commonwealth and the states. This is a very simple bill. Over the last five years the Commonwealth gave $32 billion to the states to run their public hospitals. For the next five years, this bill will give them $42 billion. That is a $10 billion increase—a 17 per cent increase in real terms.

I will deal with the argument of the Labor health ministers. When Senator Kay Patterson met with them all on Friday, 2 May, they all parroted the same line—Kucera in Western Australia, Bronwyn Pike in Victoria, Lea Stevens in South Australia—by saying it is a $1 billion cut. The ABC ran this line uncritically throughout the day. In actual fact, as I have said, it is a $10 billion increase. The reason the states are not getting as much as was projected in the forward estimates is, quite simply, that the usage of public hospitals has not been increasing at the same rate, after you take out demographic changes. The reason for that is the much greater usage of private health insurance. When the last agreements were negotiated in 1998, private health insurance coverage was about 30 per cent. Now it is about 45 per cent. We have seen the levels of usage of private hospitals increasing dramatically. That is why you are not seeing the increase in usage of the public hospitals.

In this debate there are some very simple figures to remember: $32 billion is what the states are getting now; $42 billion is what we are proposing to give them for the next five years. It is a $10 billion increase, and a 17 per cent increase in real terms. We also need to look at some figures from the Australian Institute of Health and Welfare. They show that the Commonwealth's share of public hospital funding was 45.2 per cent in 1997-98 and it increased to 48 per cent from 1998 onwards. Meanwhile, the states' share, which was about the same at 45.4 per cent in 1998-99, has declined to 43.4 per cent in 2000-01. We can see that the Commonwealth's share of public hospital funding is increasing while the states' contribution has been declining.

There are conditions in the proposed agreement that relate to transparency, reporting and so on. The states will be required to declare the level of funding that they intend to provide for public hospitals, which is what we do. This has been a notoriously murky area, where it is difficult to work out exactly how much of their own revenue the state governments are putting into their public hospitals. They will be required to have an improved performance reporting network. This is essential, because around Australia we have a number of Labor state governments that came to office promising, with hand on heart, that they would make health and education a priority. In my own state of South Australia, the Liberal state government was already spending about 67 per cent of its outlays on health and education, but still Mike Rann said, `We will make health and education a priority.' It seems the states are proposing to do it with federal government money—they are not prepared to put their own money in.

As well as the state governments stating exactly how much of their own revenue they propose to put into the public hospitals, they need to commit to matching the funding increase by the Commonwealth government. If they do not do that, they will only get 96 per cent of what is on offer. We have put our money on the table, and it is an extra $10 billion. What we want is an assurance from the states that there will not be any black holes in hospital funding. In the state of Queensland, if they do not match the Commonwealth's growth in funding they will lose $323 million. If they do not sign up to an agreement, they will lose $851 million. This is a state that, from 1 July will be—


Mr Slipper —Better off!


Dr SOUTHCOTT —better off under the GST. It is a state which is receiving about $6,000 million in GST revenue. It is only fair that the states do as the Commonwealth has always done and publicly state how much they are prepared to put into public hospitals. In addressing some of the previous remarks, I note there is a notion that the way will be open for doctors to increase fees. Let us say you have a copayment of $12, which is about the average. As far as I can work out, the argument is that if the fee is $37 it will be much harder to increase it than if it is $12. But everyone knows that effectively all they are paying is $12, and they have to go to the nuisance of either going to a Medicare office or sending off the form and waiting for a cheque. I do not quite understand how it will be easier to raise it if it is $37 and you get $25 back than if it is $12.

I also wonder if the Labor Party are suggesting that they would cap doctors' fees. This is something that Neal Blewett never did. Neal Blewett stated many times publicly that doctors' billing procedures were a matter for them. Brian Howe did just the same when in 1991 the Hawke government proposed to introduce a copayment and decrease the Medicare rebate by $3.50, with another $1.50 to come. At that time, Brian Howe said, `No, I don't expect it to affect bulk-billing; doctors' fees are a matter for them.' In essence, doctors remain free to bulk-bill all Australians, but those decisions are a matter for them.

In the budget measures, we have for the first time a guarantee that card holders will be bulk-billed. We also have increased convenience for those people who are not being bulk-billed. If you look around Australia, outside of the capital cities the majority of the population is not being bulk-billed. I am sure these people would like the increased convenience of having one out-of-pocket expense with nothing more to do and nothing more to pay. The private health funds have done this in the area of dental, physio and all of the extras, and they have done it because people want it. This is something that would make Medicare much more convenient.

The Commonwealth is offering the state of South Australia $3.5 billion to run their public hospitals—and Mike Rann and Lea Stevens have had a bit to say on this. That is an $800 million increase in the current agreement. This year it will already be a $33 million increase. That is a significant increase compared to last year's $25 million increase, but it does require the state government to match our increase in funding. One of the problems is that, under the same Rann government which was elected to make health and education a priority, less surgery has been done over the last six months than was done in the previous six months. While the Commonwealth government is paying the state government more money, they are doing less surgery. It does not make sense.

There is also the issue of GST revenue, which the state governments are now receiving. The important thing about GST revenue is that since 1 July 2000 many of the states have been better off. As the House would be aware, it was the Howard government that did the heavy lifting on the GST. We did the heavy lifting on tax reform, and it was opposed in the House and in the Senate by the Australian Labor Party. But every month the Labor treasurers line up and receive their cheques of GST revenue. Many of the larger states have been better off since 1 July 2000.

This is a very simple bill. It is not a cut; it is an increase. It is an increase of $10 billion, from $32 billion to $42 billion. It requires the state governments to meet reporting standards so that we know exactly how much of their own money they are prepared to put into their public hospitals. If they match our increase in funding, they will receive 100 per cent of what is on offer. If they report transparently, clearly and so on, they will receive 100 per cent of what is on offer. This notion that it is actually a decrease in funding is rubbish—it is garbage. It relates to the forward estimates which were projected on past growth trends. They have not eventuated because private health insurance has risen from 30 per cent of the population to 45 per cent of the population, and people are using private hospitals much more. We have not seen the expected growth in public hospitals, but we do have these agreements. It is an increase in funding.

Over the last five years, while the Commonwealth's contribution to state public hospitals has increased, the state contribution has declined. There is no way that the state governments, the state premiers or the state health ministers can get away from this. Look at the Australian Institute of Health and Welfare statistics which show the Commonwealth share increasing and the state share declining. The fundamental three parts of Medicare have always been the Pharmaceutical Benefits Scheme, a universal Medicare rebate and free access to public hospitals. The Liberal Party ran in the 1996, 1998 and 2001 elections saying, `We are committed to Medicare, we are committed to bulk-billing and we are committed to community rating for private health insurance.' Yet the ALP argue that in some way we are committed to the destruction of Medicare. They said this about the GST. We heard all sorts of doomsday scenarios about Iraq. The Australian public have heard this before from the opposition. It has not come true. It is important legislation which makes this offer to the state governments. The state governments need to take it up. As far as I am concerned, it should be non-negotiable. I think it is scandalous that the state governments are not more transparent about the exact amount of their own money they spend in this area. I commend this bill to the House.