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Tuesday, 9 June 1970

Dr FORBES - Sir, as I have announced already - in fact, as long ago as 3rd March - the Government -accepted the recommendations of the Nimmo Committee in relation to the desirable level of the reserves of the funds. It was stated at that time that the Government intended to achieve this objective, which is that the desirable level of the reserves of the funds should be 3 months free reserves, over a period by passing on . the benefits, where appropriate, to contributors. Therefore, I am able to give the honourable gentleman the assurance which he seeks-

Mr Gorton - And which you have already given him.

Dr FORBES - I have given it already.' Indeed, in the process of making decisions with the assistance of the Registration Committee as to what the contribution rates will be for each medical fund when and if our new scheme comes into being - that is, when the Parliament sees fit finally to decide upon it - and in the process of assessing what the contribution rates of each fund will be, the question of these reserves has been taken into account. The honourable gentleman will see then that the rate of contribution will vary quite considerably between one fund and another, as a result of the process of running down the reserves.

However, there is one thing I will say. The reserves of the funds are in 2 separate categories - the medical funds on the one hand and the hospital funds on the other. What we are doing at the present time in relation to contribution rates for the medical funds refers only to the reserves' of the medical funds. It is in the hospital funds that the reserves are most substantial and the process of achieving our objectives of 3 months free reserves in relation to them will need to await the outcome of the Government's decision on the hospital recommendations of the Nimmo report.

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