Judi Moylan (Pearce, Liberal Party) Share this | Hansard source

I feel fortunate indeed to have the opportunity to speak on this package of the bills, the Fairer Private Health Insurance Incentives Bill 2009, the Fairer Private Health Insurance Incentives (Medicare Levy Surcharge) Bill 2009 and the Fairer Private Health Insurance Incentives (Medicare Levy Surcharge—Fringe Benefits) Bill 2009. I am fortunate that I have the opportunity to represent every single person within the electorate of Pearce that will be affected by this package of legislation.

I recently conducted an electorate-wide survey that asked people which issues concerned them the most. The top priority for my electorate of Pearce was fixing up the hospital system. That was followed by ensuring that the government spends taxpayers’ money wisely. These are issues that I am sure rank highly with all people across Australia. Health is clearly a major issue for most families and most people and it is too often politicised. I think governments know that, if they get the politics of health wrong, it often spells political disaster. These bills are a clear example of how even the most ambiguous election promises on health mean nothing once the votes are counted. The Australian health system is the one area in which ideas should always prevail over ideology and good policy should always prevail over politics.

The package of bills before us is, in the government’s words, designed to make the private health insurance rebate and the Medicare levy surcharge scheme fairer. In essence, this is nothing more than a crude money-grabbing exercise by Treasury and Finance to pay for the reckless spending and gratuitous handouts, I am sorry to say. These bills will reduce the incentive to take out private health insurance but also increase the penalty for relying on Medicare and the public health system for many Australians. The political spin used to sell this new policy is based, as my colleague the member for Kalgoorlie so eloquently put it, on ‘Robin Hood economics’. We have heard that this measure will cost those that can afford it to help those who cannot. There seems to be something fundamentally wrong with that proposition, as I hope to outline in this speech on the legislation tonight.

To take from the rich and give to the poor in principle may have some appeal to some people, and obviously it does to the government, but our health system, as I said, is too important to be the subject of political spin. We need to look beyond that to the objective facts and to logic and reason. The fact is that this package of bills is about taking from each and every individual, whether they be rich or poor, to give to an ailing federal budget. Let us be absolutely clear: every Australian, regardless of their wealth and regardless of whether they have private health insurance, will be robbed by this new policy. So let us get beyond the rhetoric and let us look at the fact. It becomes patently clear to most people that this is not a system designed to be fair, it is not designed to fulfil an election promise to fix up the public hospital system and it most certainly is not a logical scheme that puts good policy over good politics.

Over 11.1 million Australians currently have private health insurance. Depending on their income and age, these people ordinarily receive a rebate on their insurance as an incentive for them to continue not to use the public health system. According to government figures, 1.7 million Australians will be affected by this new scheme which cuts the rebate, although industry analysis shows the figure will be closer to 2.4 million Australians. Using the government figures, 1.7 million have private health insurance and earn over $75,000 and, logically, this means that 9.4 million people have health insurance and could hardly be classified as wealthy. In fact, these figures mean that about 85 per cent of people with private health insurance do not earn enough to be directly affected by this scheme. In short, while Australians who earn less than $75,000 may not be directly affected—their rebate will not be changed—there can be no doubt that this scheme will have a massive effect on their hip pocket. That is why, when the government says that the scheme will affect only the very wealthy who can afford the extra burden, its statement flies directly in the face of the facts, for every Australian that retains their private health insurance will be hit by this scheme as, inevitably, the premiums that they pay will rise considerably.

There has been a 4.4 per cent increase in the number of young Australians joining private health insurance within the last year. If younger and healthier people drop out of private health insurance because of reduced incentives for them to participate, it then leaves the elderly, the chronically ill and the more vulnerable people in our community to pay. Currently, there are over one million Australians who earn less than $26,000 who still put money aside to pay for private health insurance. Not only do they prove that private health insurance is not just for the rich but also they show that, for many, having the choice of doctors and hospitals and the reassurance of private health insurance is worth the sacrifice. When I am out in the electorate, pensioners often discuss this issue with me and they say they are willing to pay for private health insurance because their health care is the one area that they are simply not prepared to sacrifice and they want to have a choice in the kind of health care that they need. I have met many pensioners who have had to wait for months and months, often in considerable pain, to have joint replacements, particularly knee and hip replacements. So many people do make sacrifices to ensure that, when they need elective surgery, they can get it in a timely manner and also so that they can have a choice about who provides their healthcare services. These are not wealthy people. Most are, as I said, elderly people who want the peace of mind that private health insurance brings. They make many sacrifices to be able to pay for it.

The Australian Health Insurance Association has said that every single one of the more than 11 million Australians with private health insurance will have to pay more for their private health insurance as a direct result of this policy. Clearly, it is not just the rich that will be affected. I know that sometimes people scoff at the statements from the private insurance industry. They say, ‘Well, of course, they are protecting their back, they are protecting their income stream,’ but it does not take a lot of grey matter to actually figure out that if you have people exiting—particularly, as I said, young people—this will have a dramatic effect on the cost of health insurance premiums. Because there are fewer people in the system the premium is likely to go up.

I think it is a pity that this policy is forged from an ideological position rather than being what is best for Australian people. For the 85 per cent of people that are insured and will have to pay more for their insurance, despite not earning over $75,000, they will have one choice to make: they could continue being insured and pay more or they could drop out of insurance and move to rely on the public health system. Michael Roff, CEO of the Australian Private Hospitals Association, has said:

The current system works well to provide an appropriate balance between public and private healthcare. Even the Government concedes these new measures will lead to thousands of Australians dropping out of private health insurance and as a result, put more pressure on our already overstretched public hospitals. Destabilising the current balance between public and private is not just bad policy; it is ultimately unsustainable and therefore irresponsible.

I say ‘Hear, hear’ to that. As I said, this seems to me to be a policy forged in ideology, because it will not be so difficult for the government in perhaps a year’s time or so to come into this place and say, ‘The whole system is collapsing, so let’s nationalise the health system in Australia.’ I think a lot of Australians can actually see through that, and that is why in the lead-up to the election the Prime Minister made a promise not to do what this legislation is now going to allow. He also made promises to fix the public hospital system. Further, Dr Armitage of the Australian Health Insurance Association has said:

… while higher premiums put greater pressure on every person privately insured, particularly those one million Australians with private cover who reside in households with an annual income of less than $26,000, longer hospital waiting lists affect the health of every Australia.

So who exactly is this measure aimed at helping? It clearly is not any of the 11.1 million Australians with private insurance. It is also clear that this will not benefit the uninsured Australians, who will now find themselves lining up in ever increasing numbers to access the public health system.

The government paints a simple dichotomy, where those with insurance are rich and those without are poor. We know from the figures discussed that this is simply not the case, and we know that those who do not have private health insurance are not going to be assisted. In fact, the already ailing public health system on which they rely is going to be placed under greater pressure. This goes for those who deliver the health services to the public. The Australian Medical Association have said:

… we aren’t happy about the government’s broken promise on the 30% private health insurance rebate.

I think many Australians would say ‘Hear, hear’ to that. They feel betrayed, and so they should. The Australian Medical Association sees this as a measure to take money out of health. I need not remind the House that this measure comes from the same government who promised, as I said, reform in the public hospital system and that if they could not reform the system with the states, they would take it over. Not only have they broken their promise on removing the 30 per cent private health insurance rebate; there was a lot of rhetoric before the election and absolutely nothing happening on the reform of the hospital system. There has certainly been no indication that the federal government is moving to take over the system, despite the fact that in my electorate the hospital system comes up as the number one concern of my constituents. We had over 2½ thousand responses to the electorate wide survey, and we are continuing to get those coming into my office. This is what has clearly come out as the number one priority issue.

So, not only does this scheme fly in the face of reason; it also flies directly in the fact of election promises and assurances. As recently as 24 February 2009—just earlier this year—the health minister publicly assured Australians that there would be no changes to the private health insurance rebate. This was either blatantly dishonest—and I don’t believe that, because I have not found that the minister for health engages in blatantly dishonest conduct—or, I can only assume, the government, having thrown a lot of cash around the community gratuitously, now have grave concerns about the biggest budget deficit in Australia’s history. They need to claw back the large amounts of cash that they have handed out. If the health system is to be guided by sound policy and not politics, there are other options. The most rational of those options is one that was recommended by the Leader of the Opposition: to increase tobacco excise.

I have heard the Minister for Health and Ageing—and I support the minister in this—speak on the determination of the government to try to ensure that health problems are prevented. I have heard the minister speak on this on many occasions. As I say, it is totally supportable. But you have to wonder again about the genuineness of those statements when there is a solution put forward by the Leader of the Opposition to raise the additional funds. We understand there are problems now with the budget, but the money required for the health portfolio could much more effectively be raised by increasing tobacco excise. That would more than cover the savings expected to be delivered by this particular package of bills. So it is very difficult to reconcile the rhetoric from the reality.

If the tax on each cigarette was increased by just 3c, which equates to about a 12.5 per cent increase in tax, the government could raise about $2.2 billion in the budget forward estimates over four years. While these figures have been skewed by those opposite, the figures do speak for themselves. The best policies of all are those that create a win-win situation. Not only would increasing the cigarette excise bring in additional revenue, so the lose-lose situation of altering the private health insurance rebate could be avoided, but it would also offer the additional benefit of discouraging smoking across the population. I was listening this morning to a radio broadcast. Some commentators were saying that there is a clear link to the cost of cigarettes and the ability to reduce the number of people who smoke them. It is not the only part of the story—it would be dishonest to portray it as such—but it definitely is one factor that might discourage people from taking up or continuing that habit. As I said, for a government whose rhetoric has been about preventative health, one is at a loss to really understand why this measure would not be adopted. Dr Lyn Roberts of the Heart Foundation noted recently—and I think I heard Lyn Roberts speaking on radio this morning:

Price increases are one of the most effective best ways of encouraging smokers to quit as well as deterring young people from starting.

A very important part of this suggestion is that we would have a greater chance of deterring young people from ever starting cigarette smoking if the cost were a bit higher.

Again the evidence is clear. This is not about politics; this is simply about bringing the best possible policy initiatives. I have no doubt that there is universal agreement within the House that we must act upon any opportunity to reduce the rate of tobacco consumption in Australia. Quit Australia has said:

There is absolutely no doubt that increasing cigarette prices will save thousands of lives that otherwise would be lost to the devastating harms of tobacco. Research consistently shows increases in the real price of cigarettes are crucial to reducing smoking rates.

This to me is very desirable because I saw a dear friend pass away from the effects of smoking, from lung cancer, earlier this year. It is devastating. So many people prematurely lose their life or their quality of life because of this dreadful habit.

The time for playing politics over health has well and truly passed. It is no longer acceptable that governments of any persuasion put their ideology ahead of funding and finding practical solutions. The government promised the Australian electorate that they would deliver real improvements in the public health system, particularly in public hospitals, but what we have seen is not just a long list of shattered promises but the continual use of politics and ideology over sound policy. From my point of view—and, more importantly, from the point of view of the people of the electorate of Pearce—this is totally unacceptable.

When we look at the facts behind the proposed scheme and we look at the reality behind the rhetoric, it is clear that this is fairly crude politics and the cost of all of this will ultimately fall on the shoulders of each and every Australian. Seventy-five per cent of people in my electorate have private health insurance, but 100 per cent of my electorate will suffer the consequences of this ill thought out and ideologically driven scheme. One hundred per cent of Australians will pay the price for this poorly drafted legislation and policy, which seems to be driven purely by the ideological position of the Australian Labor Party. I think the end point will be to show that the private health insurance system has failed and, therefore, they can then move to nationalising medicine.

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