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Monday, 15 June 2009
Page: 3018


Senator CORMANN (12:38 PM) —These are just a few comments to make the point that the opposition will support the Tax Laws Amendment (Medicare Levy and Medicare Levy Surcharge) Bill 2009. We consider this to be a housekeeping bill and think that it could actually have been dealt with in the non-controversial timeslot. It is a bill that comes up every year, and every year it is supported by everyone. It is about indexing a number of thresholds, in particular indexing by CPI the low-income threshold for the Medicare levy, making sure that the threshold for those who do not pay the Medicare levy because they are low-income earners is increased in line with inflation.

A number of other, related thresholds are indexed at the same time, one of them being the low-income threshold for the Medicare levy surcharge. We had an extensive debate in this chamber last year in which we said what our thoughts were on the Medicare levy surcharge threshold changes. We opposed those changes vigorously. A very comprehensive Senate inquiry into the proposed changes to the Medicare levy surcharge threshold last year over the winter recess forced the government to review its legislation twice, and to reduce those thresholds in the original measure from $100,000 for singles and $150,000 for couples and families down to $70,000 and $140,000. We still took the view that that was bad policy because it was a measure that would force 492,000 people out of private health insurance, put upward pressure on the cost of premiums and put additional pressure on public hospitals. From that point of view, we were very much opposed to it.

We just note for the record that in Senate estimates over the last fortnight both the health department and the Treasury department gave evidence that, contrary to what the Minister for Health and Ageing, Nicola Roxon, and Senator Cameron at various times have tried to make people believe, the government still expects 492,000 fewer people to be in private health insurance as a result of the Medicare levy surcharge threshold changes passed last year. In fact, not only does the government still expect 492,000 fewer people to be in private health insurance but it needs 492,000 fewer people to be in private health insurance in order to achieve the $740 million in estimated savings which are still, to this day, part of the Rudd government budget.

Notwithstanding those few comments, as I have said at the outset this is a housekeeping bill. It is about keeping the thresholds in line with inflation, and it is one that has been supported by oppositions of both persuasions over many years. On that basis, the opposition supports this bill.