House debates
Thursday, 21 June 2007
National Health Amendment (Pharmaceutical Benefits Scheme) Bill 2007
Consideration of Senate Message
Bill returned from the Senate with amendments.
Ordered that the amendments be considered immediately.
Senate’s amendments—
(1) Schedule 1, page 22 (after line 10), after item 73, insert:
73A After section 98AA
Insert:
98AB Notification by Department of alterations to pharmaceutical benefits scheme
The Secretary must cause to be made publicly available on the Department’s website information on the outcomes of the changes to the pharmaceutical benefits scheme resulting from the introduction of the National Health Amendment (Pharmaceutical Benefits Scheme) Act 2007.
(2) Schedule 1, item 81, page 29 (after line 3), at the end of subsection 99ACC(3), add:
Note: The new price for the single brand of the combination item may be the same as the existing agreed price.
(3) Schedule 1, item 81, page 29 (lines 4 to 12), omit subsection 99ACC(4), substitute:
(4) If the Pharmaceutical Benefits Advisory Committee gives advice to the Minister under subsection 101(4AC) in relation to the combination item, then, in working out the new price of the single brand of the combination item, the Minister may have regard to that advice in considering the extent (if any) to which to reduce the existing agreed price.
(4A) If:
(a) subsection (4) applies; and
(b) the Minister decides to reduce the existing agreed price;
then, in agreeing the new price of the single brand of the combination item, the Minister:
(c) may have regard to the advice referred to in subsection (4) in relation to the combination item; and
(d) must take into account, in relation to the listed component drug, or each listed component drug, that became subject to statutory price reduction:
(i) the approved price to pharmacists, on the reduction day, of each brand of a pharmaceutical item that has the drug that is the listed component drug; and
(ii) the quantity of the listed component drug contained in the combination item.
(4B) If subsection (4) does not apply, then, in agreeing the new price of the single brand of the combination item, the Minister must take into account, in relation to the listed component drug, or each listed component drug, that became subject to statutory price reduction:
(a) the approved price to pharmacists, on the reduction day, of each brand of a pharmaceutical item that has the drug that is the listed component drug; and
(b) the quantity of the listed component drug contained in the combination item.
(4) Schedule 1, item 81, page 31 (lines 17 to 23), omit subsection 99ACD(3).
(5) Schedule 1, item 81, page 31 (line 28), omit “reduction”, substitute “determination”.
(6) Schedule 1, item 81, page 31 (line 35) to page 32 (line 5), omit subsection 99ACD(6), substitute:
(6) If, on a day before the determination day:
(a) one or more of the listed component drugs contained in the drug in the existing item had been subject to a 12.5% price reduction; and
(b) because of that price reduction, the approved price to pharmacists of the existing brand of the existing item was reduced;
then the reduction referred to in subsection (5) is to be adjusted to reflect:
(c) the extent to which the 12.5% price reduction was taken into account in working out the amount of the reduction to the approved price to pharmacists; and
(d) the quantity of the listed component drug contained in the drug in the existing item.
(7) Schedule 1, item 81, page 34 (lines 21 to 27), omit subsection 99ACE(5), substitute:
(5) If, on a day before the reduction day:
(a) one or more of the listed component drugs contained in the drug in the related item had been subject to a 12.5% price reduction; and
(b) because of that price reduction, the approved price to pharmacists of the related brand of the related item was reduced;
then the reduction referred to in subsection (3) or (4) is to be adjusted to reflect:
(c) the extent to which the 12.5% price reduction was taken into account in working out the amount of the reduction to the approved price to pharmacists; and
(d) the quantity of the listed component drug contained in the drug in the related item.
(8) Schedule 1, item 83, page 62 (after line 18), after subsection 101(4AB), insert:
Function relating to Minister’s decisions about prices of combination items
(4AC) If the Committee is satisfied that therapy involving a combination item provides, for some patients:
(a) a significant improvement in patient compliance with the therapy; or
(b) a significant improvement in efficacy or reduction in toxicity;
over alternative therapies, then the Committee must advise the Minister accordingly.
(9) Schedule 1, Part 1, page 63 (after line 14), at the end of the Part, add:
93A After section 104A
Insert:
104B Report on impact of National Health Amendment (Pharmaceutical Bene-fits Scheme) Act 2007
(1) The Minister must prepare a report on:
(a) the impact of the reforms made by the National Health Amendment (Pharmaceutical Benefits Scheme) Act 2007; and
(b) the impact on the cost of pharmaceutical benefits to patients as a consequence of the reforms.
(2) The preparation of the report must be completed by 31 December 2009.
(3) The Minister must cause a copy of the report to be laid before each House of the Parliament within 5 sitting days of that House after the day of the completion of the preparation of the report.
(10) Schedule 1, page 66 (after line 23), after item 99, insert:
99A Transitional provision—approved price to pharmacists
If the determination day or reduction day referred to in subsection 99ACD(6) or 99ACE(5) of the National Health Act 1953 is a day that is on or after this Schedule commences, then the reference in those subsections to the approved price to pharmacists on a day (the relevant day) before the determination day or reduction day is a reference to the approved price to pharmacists within the meaning of subsection 98B(3) of that Act as in force on the relevant day.
10:56 am
Christopher Pyne (Sturt, Liberal Party, Minister for Ageing) Share this | Link to this | Hansard source
It is my duty to make a statement to the House concerning a Senate amendment with respect to this bill and the matter of constitutional principle it raises.
Proposed Senate amendment No. 3 is expected, if enacted, to have the effect of increasing payments to suppliers of pharmaceutical products. That is, it is expected to have the effect of increasing expenditure under the standing appropriation in the principal Act.
There is doubt that the Senate may proceed in these circumstances by way of amendment because of section 53 of the Constitution. Among other things, this section prohibits the Senate from amending a bill so as to increase ‘any proposed charge or burden on the people’.
The view has been taken that where expenditure is appropriated in these circumstances, section 56 of the Constitution requires that the proposed appropriation must be recommended by a message from the Governor-General. I understand that such a message has been obtained in this case.
The House will need to consider the way in which it should proceed to deal with the matters raised in Senate amendment No. 3. If it wishes to entertain the proposal reflected in the amendment, it may choose to proceed by alternative means.
The matter for consideration is not so much one of the privileges and rights between the two Houses but observance of the requirements of the Constitution concerning the appropriation of revenue.
I move:
That the House endorses the statement of the Speaker in relation to the constitutional questions raised by Message No. 554 transmitted by the Senate in relation to the National Health Amendment (Pharmaceutical Benefits Scheme) Bill 2007.
Question agreed to.
I indicate to the House that the government proposes that Senate amendments (1) and (2) and (4) to (10) be agreed to, and that amendment (3) be disagreed to but that an amendment be made in place there-of. I suggest, therefore, that it may suit the convenience of the House to first consider amendments (1) and (2) and (4) to (10) and, when those amendments have been disposed of, to consider amendment (3). I move:
That Senate amendments Nos 1, 2 and 4 to 10 be agreed to.
11:00 am
Nicola Roxon (Gellibrand, Australian Labor Party, Shadow Minister for Health) Share this | Link to this | Hansard source
The Minister for Ageing might be able to assist in this process. My understanding is that the amendments that were moved in the Senate will be moved here. I understand that, with the constitutional restrictions, an identical alternative amendment will be moved. The minister might be able to explain whether that is his understanding of the pro-cess that is going to be followed. Clearly, the amendment that was moved, with the support of the government and Labor, in the other place is an agreed position between the government and the opposition, and with the minor parties as well, as a result of the Senate committee process. It was my understanding that that amendment would be moved here as well. Certainly, I am happy to speak on the others. I understand that it is more about the technical nature of what can be moved in the Senate compared to what can be moved in the House, rather than any opposition to the content of the amendment. Could the minister clarify whether that is the government’s intention before I make some short comments.
11:01 am
Christopher Pyne (Sturt, Liberal Party, Minister for Ageing) Share this | Link to this | Hansard source
I do not propose to get into a debate about this. Obviously, I am not the minister responsible for the Pharmaceutical Benefits Scheme. My understanding is that the minor parties’ amendment is being disagreed to by the government, but we are enacting our own amendment this morning which is virtually in the same detail as the Senate amendment, which I understand has been agreed to by the opposition and the government. So we are disagreeing to their Senate amendment (3) but substituting our own government amendment.
Nicola Roxon (Gellibrand, Australian Labor Party, Shadow Minister for Health) Share this | Link to this | Hansard source
Thank you for that clarification. That was my understanding as well, but I thought it was important that we have that on the record. Labor does support the passage of the National Health Amendment (Pharmaceutical Benefits Scheme) Bill 2007 and the amendments that have been passed in the other place. We are disappointed that a number of the issues that were raised during a fairly truncated Senate committee process have not been able to be explored adequately. When such major changes are being made to the PBS—a very important part of the health support that the government gives to the nation—we need to make sure that we get the detail of these changes right. We are pleased, given our concerns about some of the issues that have been raised both on behalf of consumers and on behalf of the generics industry, that a number of the changes that have been accepted during the Senate process will at least allow for a proper and adequate review of whether these measures do have the intended effect.
I think everybody is in furious agreement about the intended effect. Whether or not there might be some extra impact or burden on consumers—we have some fears that it may—will now at least be able to be properly monitored and reported on at the end of a review process. The government has agreed, following the Senate inquiry, to include that provision in this legislation. We welcome that and believe that it will be of benefit to consumers and that it will provide some extra protection and confidence which were not really able to be provided to the broader community during the very quick Senate inquiry process.
We are also pleased that a number of the amendments will ensure that the departmental processes for implementing these reforms will be made more transparent. Other players in the pharmaceuticals industry will understand that, with respect to negotiations which are quite rightly held between the department, Medicines Australia and other pharmaceutical companies, there will be an extra level of scrutiny of those negotiations so that we can maintain the community’s confidence that this scheme is getting the best value for government and also protecting the needs and interests of consumers. I welcome the fact that these amendments have been agreed to, and I commend them to the House.
Question agreed to.
11:04 am
Christopher Pyne (Sturt, Liberal Party, Minister for Ageing) Share this | Link to this | Hansard source
I move:
That Senate amendment No. 3 be disagreed to.
Question agreed to.
Message from the Governor-General recommending appropriation announced.
I move:
That Government amendment No. 1 be made in place of the Senate’s amendment No. 3 which was disagreed to.
I think the debate has been covered by both the member for Gellibrand and me, so I will not give any further explanation.
Question agreed to.