Ms Catherine King (Ballarat, Australian Labor Party, Shadow Minister for Health and Medicare) Share this | Hansard source

My remarks on the Appropriation Bill and the budget concern health policy. I think the best way to describe this budget when it comes to health, as my friend Lesley Russell from the Menzies Centre for Health Policy has said, is that it is a budget of ad hockery and missed opportunities. It's a budget that has no strategy, no vision for how to prepare Australia's healthcare system for the many challenges ahead. It's a budget that is bereft of big ideas. True, there are some measures in the budget that Labor has welcomed—a new rural health strategy, although I would argue it's actually a new rural health workforce strategy. It's something that is needed, but it's not actually a rural health strategy. There is some investment in the health of mums and bubs and new medical research Future Fund disbursements, some of which of which have been badged as the National Health and Medical Industry Growth Plan.

I want to flag three serious concerns today. First, the budget in health does contain significant new savings. The budget includes over a billion dollars of new savings. This number has so far gone relatively unnoticed, perhaps because, compared to the savage cuts inflicted in previous Abbott-Turnbull budgets, a billion dollars no longer seems that much when it is being cut out of our healthcare system. It's a sad indictment of how much damage the government has done in health since coming to office nearly five years ago. These savings include $416 million from GP visa changes, $336 million from increased use of generic and bio-similar medicines, $190 million from the Medicare Benefits Schedule review, $78 million from improved use of blood products and antirheumatic drugs, and $40 million from the MedicineWise and national return of unwanted medicines project.

Of course not all of these savings are necessarily bad. Labor has offered bipartisan support for the clinician-led MBS review, despite calls for us to do otherwise from some quarters. Indeed, it was Labor who established the framework on which the MBS review is based, in order to improve efficiency, quality and safety in healthcare. Our intention was that the framework was to find smart, sensible ways to update and modernise the MBS, not to provide a fig leaf for further cuts. We are pleased that so far the government has followed the recommendations of the review, although we remain concerned about the government's overall intent. We also have welcomed constructive engagement from the medicines sector, which has led to further savings in this year's budget on top of savings banked last year.

But some of these savings will be contested. In particular, the government must urgently explain the claimed savings from the GP visa changes. Weeks on from the budget, we still don't know the details. AMA president Dr Michael Gannon has argued that these savings won't actually be realised because these patients will move to other GPs. If that's true, the government effectively has a half-billion-dollar black hole in its budget. The only alternative is that these $416 million of savings will be realised, and that means that people's access to Medicare services is being cut. Either way, the government needs to come out of hiding on this point and share the details with the Australian people that that is what it intends to do.

There is a broader question to be answered here. Where are the savings actually going? Where is that $1 billion going across the portfolio and what is actually happening in relation to other cuts that have happened in previous years? The government claims that it will redirect or reinvest these savings back into the health portfolio, but there is no guarantee or detail about how they are going to do so. For example, while there is $190 million in savings from the MBS review, there is just $25 million in new MBS listings, meaning a net cut to Medicare. You might call me a cynic, but I simply don't trust the government when it comes to health anymore. How could I? Nearly five years of broken promises and savage cuts, and trust is pretty low across the sector. Labor will be pushing the government for more detail on this new $1 billion in health savings, particularly in Senate estimates next week.

Our second concern is that the budget includes new listings for the National Immunisation Program in the PBS. Of course that is always very welcome. The minister is right that thousands of Australians will benefit from new drugs to prevent and treat diseases, including refractory hodgkin lymphoma, spinal muscular atrophy—a terrible disease—and breast cancer. These listings are particularly welcomed where they have been delayed, as in the case of the pertussis vaccine, which was recommended for listing almost two years ago. I'm not quite sure why it took the government so long.

I want to make three points about this. First, the Pharmaceutical Benefits Schedule listings are the ordinary business of government. The last Labor government spent over $6 billion to add around 800 new medicines and vaccines to the PBS, the Life Saving Drugs Program and the National Immunisation Program. We understood that the credit for listings doesn't belong to the minister of the day—they are not his personal gift to the nation. The credit belongs to the medicine companies that develop new treatments; the patients, the clinicians and the researchers who build evidence from them; the independent committees that have ensured that the new listings are clinically and cost effective; and the Australian taxpayers, who ensure that we actually have a Pharmaceutical Benefits Scheme.

Second, whether they admit it or not, governments of both stripes have struggled to afford the new high-cost drugs that will increasingly characterise the PBS, but list them we must. The discussion around PBS sustainability is crucial. The $1 billion provision for new listings in this budget is a start and it will go pretty quickly, but it is a drop in the ocean compared to the $20 billion in PBS savings under the Howard, Rudd and Gillard governments through simplified price disclosure. As many of you know, in our second term of government, Labor agreed to establish in essence a notional bank, allowing the health minister to offset new listings on the PBS against those savings. That concept was lost when this government came to office, so we are essentially back where we started.

Third, the PBS has been and always should be defined by a rigorous focus on clinical and cost effectiveness. There are worrying signs that the government has begun to politicise the PBS to secure support for its changes to rebate arrangements. Those changes may prove worthy, but no minister should overrule the respected advice of the PBAC on any issue. When there is a perception that overruling the PBAC has resulted in a drug being listed on the PBS and a company participating in a rebate trial, we have a problem. The politicisation of the PBAC process would be a shocking legacy for any minister and for any government. Of course, we will again be pursuing this in the weeks ahead.

In terms of my overall thoughts on the budget when it comes to health, this budget is notable for what it does not include. The government failed to speed up its very slow thaw of the Medicare rebate freeze, meaning elements still remain in place up until 2020, forcing soaring out-of-pocket costs even higher. They've already banked billions of dollars of savings from this freeze and they are banking billions in savings right now. That is money that has come out of the patient rebate for Medicare services. Billions of dollars have been cut from Medicare.

The government has also failed to abandon its hospital cuts—$715 million between 2017 and 2020. They went to the 2013 election committing to Labor's National Health Reform Agreement and committing explicitly to funding 50 per cent of growth in the efficient price of hospital-based activity. Their policy document stated that. They, of course, in 2014 decided to completely abandon that commitment, ripped up those agreements, started off with a $57 billion cut to public hospitals—a campaign was strongly run by Labor and the states against them for those cuts—came back and said: 'Okay. We'll fund 45 per cent of growth in the efficient price capped at 6.5 per cent.' That is a cut to public hospitals. Those are the facts. It is $715 million from 2017 to 2020. The new agreement the government is seeking to impose on states is the same funding formula, entrenching that level of hospital funding again over the next five years in the agreement.

A number of states have signed, and they have said very clearly to us that they have only done that because of budget certainty; but they recognise that this hospital deal that the government has put on the table is entirely inadequate to fund our public hospitals properly. It does nothing to deal with problems of elective surgery and emergency department waiting times, it does nothing to deal with outpatient waiting times and it basically locks our public hospitals into a funding death spiral when it comes to the Commonwealth. With trying to lock in those similar cuts to the 2025 periods, Labor has said very, very clearly that we will reverse that $2.8 billion with our Better Hospital Fund, as was announced by the Leader of the Opposition in our budget-in-reply speech.

There is also very little in this budget on prevention, other than a continued commitment to provide support and some initiatives in relation to physical activities. There is nothing in this budget on innovation in primary care. There is very little on Aboriginal and Torres Strait Islander health. In fact, there are some concerns about where the government might be going next in relation to savings for Aboriginal medical services. We will be keeping a very close eye on that. There is certainly nothing in the budget that actually starts to tackle health inequalities. In fact, while there is a lot of activity in the budget—listings, disbursements and grants—there is very, very little focused on outcomes or innovations in that long-time future vision that we need for our health care

I am sorry to say that is typical of the government's approach to health. There are plenty of announceable things—anybody would think that maybe we are in an election year—but no overarching strategy for the portfolio itself and no attempt to grapple with the big challenges ahead. After repeatedly attacking health throughout it first term, the government has spent much of its second term settling disputes that have been on it own making. It certainly has taken up a lot of the minister's time over the last 18 months. But what we actually need is a government that is prepared to ask and help to answer the big questions in health and not just clean up the messes of its own making. These are questions like: how do we better promote health and prevent disease; what is the role of the national government in that space; how do we ensure all Australians can access quality, affordable healthcare; and how do we adapt our unique healthcare system to meet our future needs? There isn't the slightest indication in this budget that the government is asking these important questions, let alone seeking to answer them.

In the last few minutes I have got remaining, I would like to talk about the budget in relation to my own constituency of Ballarat. In two words, what does the budget mean for Ballarat? Not much. The budget fails the people of Ballarat pretty badly. It seems like this government would struggle to pinpoint Ballarat on a map, let alone take a look at the worthy list of projects that needed funding in our community. There was a long list: the establishment of an emergency services hub at Ballarat Airport, stage 2 of the Ballarat Western Link Road and waste-to-energy projects that have been pursued by the City of Ballarat and the Hepburn Shire for some time. They are great projects. There is also the Bacchus Marsh regional community sporting hub and the restoration of our historic Her Majesty's Theatre. None of those projects are mentioned in the budget. Hopefully we will see some election announcements, but I am not holding my breath. Under the budget, these projects will have to continue to await funding.

I note the government's previous announcements that they will support the Melbourne Airport rail link, but as with everything the devil is in the detail. The $5 billion looks like it is going to be equity funding; it is not going to be a grant, which makes it incredibly problematic when it comes to public transport infrastructure of this nature. I have also said very clearly it is important that the route—when and if developed; it's in the never-never for this government—must go through Sunshine in order to ensure that the west of the state actually benefits.

Equally, the government has failed to fund aged-care packages to the level that is required. They have basically funded an additional 14,000 packages over the next two years, but taken that money out of the aged-care portfolio overall. When you have 100,000 people there, those circumstances are simply untenable. That includes my own dad—as his local member, the member of Chisholm, knows—who is waiting for a level 4 package. There are continued cuts to public hospitals. In my region, there was a $5.7 million cut. There are continued cuts to TAFE. All of those have significant effects on regional communities such as my own. This budget certainly does very little for Ballarat, very little for Victoria and very little for the nation, particularly when it comes to the vital area of regional services and health. (Time expired)

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