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Wednesday, 1 December 2004
Page: 118


Senator CHRIS EVANS (Leader of the Opposition in the Senate) (5:35 PM) —As I was saying before I was rudely interrupted, the government has stated that these election measures are to be funded by savings achieved primarily by changes to the Pharmaceutical Benefits Scheme pricing arrangements. Indeed, the policy document entitled `Recognising senior Australians—their needs and their carers' includes so-called savings worth $830.6 million as a result of the PBS changes. I have already referred to the Department of Finance and Administration's analysis of the government's costing of this proposal and have found a shortfall of $130 million.

There are two other things though that must be said. When Labor approached the government last year to look at savings that could be made to the PBS through the introduction of generic brand pharmaceuticals, therefore ensuring the sustainability of the PBS, the government condemned us. We saw the likes of Senator Minchin lecturing Labor about the uncertainty of the impact of generics on the PBS. He said that he would:

... consider that it would be inappropriate to make any form of speculative provision in the forward estimates for the effects of generic drugs coming onto the PBS.

But now a few months later the government is using exactly this measure to fund this bill and it is relying on it to the tune of hundreds of millions of dollars. What is more, Mr Abbott was trumpeting that same inappropriate PBS listing and pricing regime—condemned by Senator Minchin—in a press release on 1 October saying that the measures would apply from 1 January. Well, where are they and where is the legislation to implement the new listing and pricing arrangements? Where is the economic modelling that he relied upon to promise cheaper pharmaceuticals from next month? Is the government going to amend the PBS? There appears to be no plan to do so. Is this the first non-core promise of the 2004 election? The government has the spending, but it does not have the savings to pay for it.

Labor will be supporting the new measures that were promised by the government during the election campaign in order to provide some compensation for the problems created by the government's earlier policy mistakes. The measures outlined in this bill were promises made to the Australian people and Labor intends to facilitate the government's delivery of those promises.

I will conclude with some observations on the difference between Labor's and the coalition's attitude to, and management of, social welfare. Unlike the government, Labor are committed to a fairer social security system which offers the necessary level of income support for Australians when they need it. We also believe that the social security system should supplement Australians on low incomes, particularly families who face additional costs in providing for children, people with disabilities and people who make sacrifices to care for others. Labor believes we should support Australians but also provide incentives to help people make the transition from welfare to work. The social security system is most effective when it rewards hard work and increases people's access to opportunities and skills so that they can improve their standard of living. To achieve these objectives, our social security system should be an integrated structure of income support measures. Real social security reform would seek to make the system simpler and more accessible to those Australians who access social welfare payments every year.

As I have said, in this bill the government has failed to fix the long-term problems in our social security system. It has failed to fix the problems and it has failed to do the right thing by more than six million Australians. Labor will pass this bill but will continue to argue for a fairer, simpler and better system of social welfare to service all Australians.