Julia Gillard (Lalor, Australian Labor Party, Shadow Minister for Health and Manager of Opposition Business in the House) Share this | Hansard source

I rise to speak today on the appropriation bills for the 2006-07 budget. The budget will appropriate $42 billion to the Department of Health and Ageing, with significant amounts going to the roll-out of commitments associated with the Council of Australian Governments health agenda announced earlier this year. There are also allocations related to the Howard government’s pre-announced changes to the private health insurance system and the sell-off of Medibank Private.

Last year’s budget administered a $1.3 billion cut to health. On the surface this budget appears different, with a new amount of $3.2 billion allocated across the forward estimates. However, if you scratch the surface we can reveal that this budget confirms what is already well known to those who work in the sector and those who rely on the health system to get well and to stay well. Scratching beneath the surface of this year’s health budget reveals that although we are three years on in Minister Abbott’s tenure in the Health and Ageing portfolio, nothing has changed. Sadly, at a time when Australia is economically well placed to rebuild our health system, the budget again is a montage of preannounced measures, tangential agendas and piecemeal policies which add to the creaking mass of programs and items that make up our health system.

The budget confirms one thing and that is certainly this: over 82 per cent of the budget’s health measures are being driven and delivered by someone other than the minister for health, Tony Abbott. Sixty-two per cent of the total health budget is allocated to measures driven by the Council of Australian Governments—that is, to the additional health budget—and we know that the Council of Australian Governments has dragged the Commonwealth kicking and screaming to the health reform agenda table. Twenty per cent of the total new health budget is allocated to measures driven by the sale of Medibank Private, which has been the responsibility of the minister for finance ever since the Howard government realised that it was more important to fatten it up for sale than use it to deliver a more competitive and value-for-money private health insurance product.

You are probably wondering what the minister for health, Tony Abbott, does with all his time. I have been wondering that too, so I was happy to find out recently, with the help of his department, what the minister actually does do with his time as health minister. Recently, information received through a freedom of information request from the department of health confirmed what we already knew about this minister. He sees his job not as managing the health system but as managing the way his management of the health system is perceived.

In August 2003 the minister’s department commissioned the Wallis Group to undertake a series of surveys of the general public on the health system. Another consulting company, Campbell Research and Consulting, were involved in the preparation of the survey which took almost 18 months to complete and included development, approval, testing on focus groups and ‘cognitive testing workshops’. The first survey was not conducted until February 2005 and there were 10 surveys in all, from February to November 2005.

Some might argue: isn’t it a valid use of resources for a minister to conduct a survey of perceptions of the management of his portfolio if it can be used to make the system better? This might be true if the survey polled regular users of the health system, particularly in areas that are not already covered by the department’s own data collecting agency or the government’s own official source of statistics. But this survey asked about things like their access to services and doctors, which is already covered by the minister’s own departmental statistics on Medicare, his portfolio agency, the Australian Institute of Health and Welfare’s data releases, the government’s own ABS, and labour market statistics from the Department of Employment and Workplace Relations.

The survey asked about the use of private health insurance and hospitals which, again, is already covered by the minister’s own portfolio agencies, the Australian Institute of Health and Welfare, the Private Health Insurance Administration Council and the government’s own ABS. The survey asked questions about the PBS—again covered by official sources from the department’s Medicare data and available from Medicare Australia’s website for free.

I am not so sure that the minister or his department were too interested in finding out the facts in any case. On close examination of the survey’s sample population we can reveal that the department explicitly excluded the frail aged and those who are too ill. Can you believe that from a survey on health? The sample also excluded most people who were from a non-English-speaking background. In the first month of the survey alone this had the effect of excluding 300 potential respondents who would undoubtedly have provided a more diverse range of views on their recent experiences with the health system.

How much did this exercise cost the health budget? Not only did it employ and divert valuable departmental resources over a period of almost three years; it cost $1.2 million, with this year’s annual departmental report undoubtedly set to disclose further information on consultancies employed to manage this process. The only point of this research was to assist with the minister’s spin doctoring. This is a shameful waste of time and resources. This is all about the image of the Minister for Health and Ageing, Tony Abbott, and nothing to do with Australia’s health system.

The 2006-07 budget has confirmed the sale of Australia’s biggest not-for-profit private health insurance fund, Medibank Private. However, the budget fails to disclose how the sale will occur, whether this sale will be by trade sale or float and how the sale will impact on members of Medibank Private. The budget allocates $20 million to the Department of Finance and Administration to manage the sale of Medibank Private in this financial year. The fact that the sale costs are budgeted in this financial year confirms that the Howard government is prepared to sell off Medibank Private at any price. Scheduling the sale in this financial year will see Medibank competing against other major privatisations such as those of Telstra and the Snowy Hydro. Medibank Private will also be sold despite concerns about competition and that the sale will lead to higher private health insurance premiums.

With repeated premium increases well above CPI, private health insurers are failing to offer value-for-money products, and the situation may get even worse after the sale of Medibank Private. Selling Medibank Private will not guarantee greater competition. If Medibank Private is sold as one entity then there will be exactly the same number of private health insurers in the market as there was before the sale. If Medibank Private is bought by one of the bigger for-profit private health insurers then this will shrink the number of players in the market. If the trade sale sees the fund split up and sold in pieces then that too will shrink the number of players in the market.

Labor is opposed to this sale. Labor believes there is a role for a public, not-for-profit health insurer that can deliver quality and competing products, with its contributing members as the company’s main focus. Labor also believes that the Howard government owes it to the Australian people and, in particular, Medibank Private members to answer the following questions. How will the sale be structured? How will the sale affect existing members? How will existing members be reassured that premiums will not rise if Medibank Private becomes a for-profit fund by more than they would have had it remained as a not-for-profit fund? How will existing members be reassured that existing policies and claims will be honoured in the same way as they are currently? Does the cost of the sale include legal advice about whether the sale should be structured to return benefits to members? Does the cost of the sale include the legal costs of defending a class action from members whose contributions have built up the fund?

Labor is also concerned that additional funding for medical research announced as part of the sale of Medibank Private will be conditional on the sale of Medibank Private. In Budget Paper No. 2 there is a $500 million commitment over four years for health and medical research and a $170 million commitment over nine years for research fellowships. However, each measure has the following caveat:

This commitment follows the Government’s announcement ... to sell Medibank Private Limited ...

If medical research is an investment that will bear fruit for technological and health advancements and deliver dividends to our economy, it should not be linked to the sale of an asset, particularly when around 64 per cent of Australians are completely opposed to the sale of Medibank Private. The Howard government and indeed the finance and health ministers have yet to explain whether delivering any of the new money for medical research is contingent on the sale of Medibank Private.

The Minister for Health and Ageing has also tried to bury a series of health cutbacks in the budget paper. Under the boasts of increased health spending lie cutbacks which will hurt average Australian families. The biggest cut is a cut of $260 million to the Pharmaceutical Benefits Scheme. The budget refers to the cut as a ‘parameter variation’, but this means that budget estimates on PBS spending have been cut because fewer sick Australians are filling prescriptions than was originally expected. Whilst the government has tried to use a series of explanations for this fact—including most recently, and ridiculously, a claim that public holidays in the reporting period affected the statistics—it has provided no real explanation as to why there are fewer sick Australians filling prescriptions than was originally expected.

This continues a long series of cuts to the health budget, including $1.3 billion from the PBS last year and $500 million from Tony Abbott’s ‘rock solid, ironclad’ Medicare safety net. The government’s attacks on the PBS have made essential medicines increasingly unaffordable for many sick Australians. As a consequence, we can expect more hospital admissions and greater health care costs in the future. Despite claims by the Treasurer that the cost of the PBS was skyrocketing and urgently had to be reined in, the growth rate of the PBS has dropped below two per cent. Official government data shows that, over the 2005-06 financial year to date, PBS spending has grown by just 1.6 per cent.

The budget also makes cuts to the government’s 2004 so-called Strengthening Medicare program, which in the run-up to the election campaign was touted with an advertising campaign which cost $20 million. Neither the workforce measures nor the bulk-billing incentive measures for concession card holders and children, which were key aspects of Strengthening Medicare, have been funded beyond 2009. This proves that Strengthening Medicare was nothing more than a pre-election con, just like Tony Abbott’s ‘rock solid, ironclad’ guarantee about the Medicare safety net.

Other cuts include $1.5 million ripped out of the More Doctors for Outer Metropolitan Areas measure and $6 million ripped out of the Better Access to Radiation Oncology program. The Treasurer and the health minister want us to believe that their brutal PBS cuts are necessary if new medicines are to be listed on the PBS. More than two months ago, the Pharmaceutical Benefits Advisory Committee approved two new long-lasting insulins for PBS listing, Lantis and Levemir. Despite the enormous benefits these medicines will provide to diabetics, the minister is yet to take them to cabinet for final sign-off.

More than 15 months ago, the PBAC approved Enbrel for the treatment of small groups of patients with crippling psoriatic arthritis. Again, the minister is yet to take this to cabinet. Women with breast cancer are waiting anxiously to see whether the PBAC will approve Herceptin at its July meeting, but they might wait even longer for the minister to ensure this drug is listed on the PBS. There is also evidence that for two years the minister for health has been sitting on recommendations by an expert subcommittee of the PBAC for expanded PBS access to cholesterol-lowering drugs, particularly for people with diabetes. These drugs are now off patent. Expanding their PBS listing would be very affordable and would have massive health benefits in preventing heart disease.

The minister’s failure to respond to this expert advice has frustrated doctors to the extent that 17 top specialists have personally written to the minister to urge him to act within his ministerial responsibilities in a timely manner so that those patients whose health and finances suffer because their medicines are not listed on the PBS are not unduly affected by his incompetence. But the minister has form on failing to respond to expert recommendations, as his rejection of the ATAGI recommendations for childhood vaccines for pneumococcal disease, chickenpox and polio showed.

Minister Abbott should stop playing politics with the PBS and do his job, so that the PBS continues to provide affordable medicines to those who want to manage their chronic conditions so that they can get on with their work and their family commitments. What on earth could be more important than that? The minister for health should be concentrating on fixing our health system and building the health system of the future, a health system which will be prepared for an ageing population. This budget could have delivered so much and it has simply failed to do so.

It certainly should have delivered after-hours medical services to take pressure off emergency departments. Right around the country, particularly in outer suburban and in regional areas, emergency departments are under pressure night after night because there is nowhere else for people to go if they have a health problem outside ordinary hours. This has been driven by the medical workforce crisis that the Howard government has exacerbated with its early cutbacks to medical training. It is a problem created by the Howard government and it is a problem that should be fixed by the Howard government. Of course, it remains unfixed.

This budget should have reinstated the Commonwealth Dental Scheme, to get the 650,000 Australians waiting an average of two years for dental care off waiting lists. Before we hear any absurd claims that this is not a Commonwealth responsibility, pick up a copy of the Australian Constitution. And, before we hear any absurd claims that this is the fault of state Labor governments, recognise that every state Labor government has expanded investment in dental schemes. This budget should have redesigned and invested in our medical workforce supply and distribution systems, and it should have reformed the relationship between the Commonwealth and state governments to reduce waste, stop buck-passing and end blame-shifting in our health system.

Access Economics has supported Labor’s view that Tony Abbott has failed to deliver an agenda for the future of the Australian health system and has squandered an opportunity to build a reformed health system with a focus on prevention and early intervention which would meet the needs of average Australian families. An Access Economics report describes the Howard government as ‘slow moving’ and explains that the government has ‘passed up opportunities to improve health outcomes’ and is ‘ducking’ areas like obesity and increasing pressures on public hospitals.

In conclusion: in respect of health, the 2006-07 budget is full of hidden cuts and simply squanders the opportunity to fundamentally reform our health system and invest in creating a much better health system for the future.

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