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Wednesday, 14 December 1983
Page: 3748

Senator ZAKHAROV —My question is directed to the Minister for Veterans' Affairs. I refer to the Minister's decision last April to overturn the razor gang decision of the previous Government to allow commercial manufacturers a share of the market in supplying artificial limbs to repatriation beneficiaries. I ask the Minister whether his decision to deny any new manufacturers access to the repatriation free limb scheme has resulted in a significant reduction in the share held by commercial manufacturers in that scheme. If not, what further steps does the Minister plan to take?

Senator GIETZELT —It is probably not generally known that the Rehabilitation and Artificial Limb Appliance Centre which operates under the Department of Veterans ' Affairs supplies artificial limbs not only to veterans but also to all other disabled persons throughout Australia. The cost is borne by the Commonwealth Government. The decision of the Fraser Government to take advantage of the Review of Commonwealth Functions to enter a private enterprise content into the system created a greater destabilising effect upon that organisation than I expected. As Senator Zakharov suggested, my announcement earlier this year was in two parts. Firstly, I indicated that no new commercial manufacturers would be allowed into the system from the date of that announcement because their entrance into the system would increase by about 33 per cent the cost factor for the supply of the artificial limbs. Secondly, I indicated that I would act on recommendations from an independent consultant's report on the fees and the structure of the free limb scheme. Having had a chance to look thoroughly at the RALAC organisation since then, I have come to the conclusion that the razor gang decision almost destroyed the viability of the whole operation of that scheme, which has been functioning since World War I. It is quite clear to the Government that there is no place for the profit motive in the rehabilitation services, in particular the supplying of artificial limbs to disabled persons.

I have now made three further decisions designed not merely to halt the decline which the razor gang set in motion but also to create some improvement in the scheme and to get the scheme back into efficient operation. The first decision I have had to make in recent times is to freeze the share of commercial enterprises in the free limb scheme as at 31 December 1983 to prevent any unauthorised change of ownership or corporate structure by participating companies and to require those companies to use award wages in their pricing calculations, thus limiting their ability to poach skilled RALAC staff, something which has been a very big problem for that organisation. The second decision is to improve the service provided by RALAC by extending its hours of operation, providing a RALAC visiting service to country centres, including the establishment of decentralised agencies and a mobile workshop, and expanding the marketing of our services, particularly in Victoria because something is radically wrong with the operation of the scheme in that State as it relates to the State hospital system. The third decision is to control the cost of the free limb scheme by introducing measures to reduce the scope for overservicing by private participating companies. I am confident that those three additional decisions will ensure a much more reliable, efficient and cost-effective RALAC service for those who participate in the free limb scheme.