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Broken election promise leaves gaping black hole.

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Media Release

JULIA GILLARD MP Shadow Minister for Health

8 December 2004


The Howard Government’s decision to delay a reduction to the cost of generic medicines by six months leaves a serious question mark as to how they intend to pay for their election hand-outs to older Australians.

Under the cover of the rubble from the regional pork rorts, the Minister for Health, Tony Abbott, slipped out a media release late yesterday confirming the Government won’t meet the 1 January 2005 implementation date for a 12.5 per cent reduction in the cost of generic medicines. Instead, he is now predicting an effective date of 1 July 2005.

The claimed $831m in savings expected from the changes were supposed to fund a raft of pre-election sweeteners for older Australians including the utilities supplement for aged pensioners, veterans and self-funded retirees.

The result is a broken promise on generic medicines and a big black funding hole.

The Minister for Health claims that breaking his promise to reduce the price of generic medicines by 1 January “will make little difference to the savings to be achieved” but how does the Howard Government now expect to pay for their election commitments?

The funding black hole for these election commitments is even larger than that caused by the delay in implementing savings on generic

medicines as costings done by the Department of Finance and Administration show that the Government over-estimated the possible savings from the implementation of this provision by $128 million.

This is the classic Howard Government style - make quick-fix promises in the heat of an election campaign, worry about the consequences later and then change the playing field when it all falls apart. They did it on the Tassie forests and they’ve now done it on generic medicines. What’s next?

Labor cares about looking after our older Australians with properly funded measures that will help them meet their day to day expenses and Labor supported the legislation to ensure that the new entitlements would be in place as soon as possible. But Labor doesn’t support broken election promises that question whether the benefits they were supposed to fund are worth the paper they are written on.

For further information contact:

Julia Gillard MP on 0417 361 637

Blythe Hamilton on 0438 396 298