Christopher Back (WA, Liberal Party) Share this | Link to this | Hansard source

We now have the third of the three Gs: we have had the GST under the Howard government, we have had the GFC and of course now we have the GBP, the government of broken promises. You will recall, Madam Acting Deputy President, that this is the government that came in on the promise of honesty, transparency and, as Senator Collins knows, accountability. Do you remember Prime Minister Gillard saying, 'Let the sun shine in'? Well, it is the fact that it has been a very short summer here on the east coast and a very short summer of honesty, transparency and accountability. This is the government about whom the former Prime Minister, then Minister for Foreign Affairs and now backbencher, Kevin Rudd, said recently:

… Julia has lost the trust of the Australian people and … if we don't change, the Labor Party is going to end up in Opposition.

This is also the government about whom the former Attorney-General Robert McClelland only recently said:

I don't think we have captured the attention or the support of the broader Australian community, and obviously if we want to win an election, they have to listen to us, they have to trust us, they have to have empathy with us …

This is not my side of the chamber saying this; this is the government side. Only last week I was at the Wagin Woolorama in the Great Southern region of WA. I overheard a mother scolding her daughter for telling porkies, and the little girl looked up and said, 'Why can't I? The Prime Minister can and the Prime Minister does.' She looked at me and I had no answer, of course.

But what day is it today? Is it carbon tax day? Of course, no; that was last week. But I will remind you of the words of this Prime Minister: 'There will be no carbon tax under the government I lead.' Her Treasurer and Deputy Prime Minister said at the same time—amazingly enough, just before an election in 2010:

Well, certainly what we rejected is this hysterical allegation somehow that we are moving towards a carbon tax from the Liberals and their advertising. We certainly reject that.

So it is not carbon tax day. Is it audit compliance day? No, that was Wednesday. That was the day, if you remember, when we had the Australian National Audit Office undertaking an audit of none other than Ms Gillard as Minister for Education and reporting to the parliament that on more than three occasions Ms Gillard approved grants to schools in defiance of the recommendations of her department and also failed to undertake the requirement of the then Prime Minister to report her decision to the then Minister for Finance and Deregulation. What a great group of four it must have been. How wonderful to have sat around the table and listened to them agreeing with each other. But it does not stop with the Prime Minister, as is often the case, because most organisations learn from the top. News filters downhill more quickly than it does uphill. In that same audit report from the ANAO we learnt that there were no less than 33 cases where ministers failed to alert the finance minister to the fact that they had made grants in their own electorates—11 of those 33 instances against the advice of their own department.

But it is not carbon tax day; it is not audit compliance day; it is Thursday—it must be private health insurance broken promise day. Let me go back to then shadow minister Ms Julia Gillard writing in the Courier Mail:

YOUR correspondent Russell McGregor … should have no concern that Labor will "erode" or abolish the 30 per cent government rebate for private health insurance. Labor is committed—

said Ms Gillard—

to the maintenance of this rebate and I have given an ironclad guarantee of that on a number of occasions.

Is it any wonder that the little girl in Wagin, reflecting the rest of Australia, has lost all patience with this government and its credibility? Again, Ms Gillard, complaining in a newspaper, the Weekend Australian, in October 2005:

The truth is—

she wrote—

that I never had a secret plan to scrap the private health insurance rebate, and contrary … do not support such a claim.

We go from Ms Gillard to then shadow health minister Roxon—again, prior to an election—in 2007. This is what she said at the annual conference of the Australian Health Insurance Association: 'This is why we have committed to the current system of private health insurance incentives,' she said, 'including the package of rebates, the lifetime health cover, the surcharge. Labor understands that people with private health insurance, now around nine million Australians, have factored the rebate into their budgets, and we will not support taking it away.' She went further in September: 'We have committed to it. We have committed to the 30 per cent.' The journalist must have had some understanding of the future because she was asked again, 'So you will not wind back the 30 per cent private health rebate, despite the fact,' the journalist asked, 'that Labor has been ideologically opposed to it in the past?' And guess what her answer was? 'No we won't.' She went on to say: 'For many occasions for many months we have made it crystal clear we are committed to retaining all of the private existing health insurance rebates.' She went on to say: 'The Liberals continue to scare people'—doesn't this remind you of Mr Wayne Swan's comments about the carbon tax?—'into thinking that Labor will take away the rebates.' This, according to Ms Roxon, is absolutely untrue.

We then go to the leader of the then opposition, Mr Rudd, speaking to the same organisation, the Health Insurance Association, prior to the 2007 election. This is what he said: 'Both my shadow minister for health, Nicola Roxon, and I have made clear on many occasions this year, that federal Labor is committed to retaining the existing private health insurance rebates.' And in February 2008, after becoming Prime Minister, he said:

The Private Health Insurance Rebate policy remains unchanged and—

by way of emphasis—

will remain unchanged.

How much longer do we have to listen to these statements which we now know to have never been the intention of the government?

Just yesterday, we had the gross misfortune of listening to a tirade by Labor Senator Cameron, trying to vilify the then coalition government in terms of its expenditure and its commitment to health. Let me place these figures on record. It is an area, of course, in which you, Madam Acting Deputy President Moore, have a particular and keen interest. Health and aged care spending: 1995-96, $19½ billion dollars spent by the Commonwealth government, increasing to $52 billion by 2007-08. Public hospital spending: 1995-96, $5.2 billion; 2007-08, more than double, to $12 billion. Funding to the states to support their health initiatives: 1993 to 1998, $23 billion; 1998 to 2003, a leap to $31 billion, and, in 2003 to 2008, $42 billion. And we continue to hear stupidity and nonsense from intelligent and otherwise honourable senators of the other side talking about the apparent billion dollars of Mr Tony Abbott when he was health minister. There never was $1 billion taken out of the health budget. It simply was a forward estimate in the forward papers of that era. There never was a $1 billion black hole by Mr Abbott.

Senator Jacinta Collins interjecting—

There never was, Senator Collins.

Jacinta Collins (Victoria, Australian Labor Party, Parliamentary Secretary for School Education and Workplace Relations) Share this | Link to this | Hansard source

Well, he was planning—

Christopher Back (WA, Liberal Party) Share this | Link to this | Hansard source

Let us go forward. Do not speak about—through you, Madam Acting Deputy President—what people might have been planning to do; listen to the quotes I gave in the last few minutes from Ms Gillard, Ms Roxon and Mr Rudd. What were they planning to do? Heavens above!

We then learn that, under this government, in June 2010, the highly respected Professor John Mendoza resigned as chairman of the National Advisory Council on Mental Health. Why? Because of the lack of action of this government in the area of mental health. So it begs the question: why has Labor changed this policy?

There are several reasons. One is on the corner to my left: because it is driven by the Greens political party who want to see the destruction of private health. Another is: because of the massive budget blowouts of this government, because of the incredibly high levels of debt, because they know they are facing another deficit this year, as they will be next year. Let me just remind you: the last time Labor was in government in the Hawke-Keating era the coalition was left to repay a debt of $96 billion a year, then costing some $6 billion—thousand million—a year in interest alone. We know now that that figure is $230 billion, racing towards $250 billion. And this government continues to borrow $100 million a day, every day of the week—not the working week, the entire week. So if you want to start to try to ramp back, who do you attack? You attack hardworking, middle-class Australians.

But this is bad policy. Why is it bad policy? Let me give you the analogy of a pool—a pool of money—into which the government puts 30c of each dollar, that being the private health rebate. But on the other side of the coin, the person taking out that insurance puts in the other 70c. How smart is it to remove that 30c, or a proportion of it, only to have the private health insurer taking out either their 70c or a significant proportion of it by reducing their level of cover? Where is the validity of such a decision? We all know what happens to the pool of money—the pool dries up—and we know that it drives people back to an already overstretched public health system.

These are the facts. The private hospital system in this country currently treats 40 per cent of all patients, being more than three million a year, and, more importantly, performs over 60 per cent of surgeries. Six out of every 10 surgeries in this country are performed in the private hospital system. The Productivity Commission found that the private hospital network treats patients more cheaply and at least as safely as public hospitals, if not more safely. In 2007-08 the government spent $31 billion on the public health system and, in contrast, only $1.7 billion on private hospitals through the private health levies.

We are all acutely aware that we have a rapidly ageing population in this country. Why would we place at risk the medical and hospital care of an ageing population by removing the 30 per cent rebate? The very group that we will be driving out of private health are the young people of this community—the ones who draw least on the health system, be it private or public.

Let me give you some examples. We have heard from the current Minister for Health, Ms Plibersek, who has decided to demonise high-income earners and even middle-income earners who, she says, should not receive subsidies from the lower income areas of this community to support their private health insurance. The minister should be reminded that, as she well knows, there is already a 1.5 per cent Medicare levy on taxable income to support the public health system. Furthermore, if high-income earners fail to have public health cover they can add a one per cent Medicare levy surcharge to their payments to the community. There is the subsidy from higher income earners. Quick calculations: somebody earning $80,000 a year together with superannuation and fringe benefits who does not take out private health cover will be paying $2,000 per annum towards supporting Medicare. There is the support from higher income earners. Even if that person takes out private health, at 1½ per cent on their $80,000, they will be paying $1,200 in Medicare levy a year. As I was reminded recently, that taxable income includes overtime and zone allowances. What we are really doing is saying, 'The harder you work, the more overtime you work and the more you earn, the more you will be imposed with a levy.' This, apparently, is what this government wants to move towards.

Why is it so dangerous? Why is it such bad policy? As we know, older people in the community have the greatest demand and the greatest draw on the health system, and that is getting even greater. My understanding is that these figures are accurate: people under the age of 19 years would exercise about 15 per cent of the national health budget; from 20 up to 65 it is about a quarter, about 23 per cent; and from 65 onwards, 60 per cent of the nation's health budget is spent on that age demographic. The more we keep young people in private health, where they are not drawing on the need for health and hospital cover, the better it will be for older members of the community. The Labor government might say, 'Yes, but of course the reduction of the rebate is limited and therefore lower income people will be less disadvantaged.' The simple fact of the matter is that, as the pool of private health funding reduces, the inevitable outcome must be that premiums will go up and people will start to take a reduced level of cover, if they take out cover at all. These are the sorts of areas that we need to be addressing and that this legislation will strike right at the heart of.

We hear from Minister Plibersek that this is only a tax on wealthier people. It is an interesting statistic in Australia that one million-plus households earning less than $26,000 per annum take out private health cover. Private health is not something for wealthier Australians—it is across the board. It is something that young families, middle-aged families and families with younger children and teenagers engage in, and it is an area that older Australians value very deeply. Why does this government want to attack the very surcharge levy that it said it would never touch?

I come to the reaction from people in my own community of Western Australia regarding the feedback from the Hospital Benefit Fund, which is a not-for-profit fund. This is not a fund that is trying to extract vast sums of money from its members, it is one that pours its funds straight back into members' conditions. Already, HBF estimates that 25 per cent of its members will see a big hike in their premiums, and this will increase to 43 per cent. That is an increase in premiums for those who will be hardest hit. We know already that the funds are battling to keep their premium increases to a minimum. The Minister for Health, Ms Plibersek, has only recently approved an average increase of 5.06 per cent. Many members are already anxious about the implications of the removal of the rebate of up to 30 per cent.

Another point made to me by this organisation is the sheer complexity of the processes as they are now being presented to the parliament. The legislation, which applies a means test to the rebate and further complicates the Medicare levy surcharge, will only serve to compound this complexity. It will only serve to discourage those who are already planning to come into private health. It may also accelerate the move of those who now believe they cannot afford it or they must reduce their premium levels. These are great concerns.

We have a wonderful health system in this country. We have a combination of public and private health care. There are all sorts of models. Models that would be best in this country have been put to me. These models suggest we move everybody into private health cover and then provide premium relief or payments for those unable to afford those premiums. We must continue to have competition to drive prices down, to keep quality up and, above all, we must do what we can to preserve and protect both the private health and the public health systems. This legislation is simply a grab for money. It is not about health policy. It should not be supported.

Sean Edwards (SA, Liberal Party) Share this | Link to this | Hansard source

I rise to speak on the Fairer Private Health Insurance Incentives Bill 2012 and related legislation. These bills will see the private health insurance rebate means tested and the Medicare levy surcharge increased for those who choose not to have private health insurance. The private health insurance rebate, a coalition initiative, saw private health insurance membership climb during the Howard years from 30 per cent in the 1990s to 47 per cent in 2008. On most recent industry figures, some 52.9 per cent of the Australian population have some form of private health insurance. The Howard government provided the incentive and increased the choice for individuals and families to take out private health insurance. I support a mixed public and private healthcare system where Australians have the choice to take out private health insurance. I also support the rebate for increasing the choices available to all of us.

Australia has one of the best healthcare systems in the world. We should strive for improvement and for it to cost less. Our healthcare system is a delicately balanced mixture of public and private. In my home state of South Australia, with a population of just over 1.6 million people, there are some 1,008,334 holders of private health insurance, according to private health industry figures. However, the cost of providing health care continues to rise. Figures from the Australian Institute of Health and Welfare reveal that in the 10 years to 2009-10 health spending grew in real terms by an average of 5.3 per cent, compared with an average real growth in GDP of 3.1 per cent a year. Spending on health in Australia costs the Commonwealth, state and territory governments over $120 billion a year. Therefore, it makes sense to encourage wherever possible individual investment in our healthcare system through individuals' choices to co-invest in their own private health insurance. It simply makes no sense to remove the incentives for individuals and families to invest in their health provision.

Currently we have over 11 million private health insurance members who are contributing extra financial resources to the health sector, so that all Australians can benefit from a stronger health system. Both public and private must continue to co-invest. But rather than rewarding these members this legislation seeks to disincentivise this private investment in our healthcare system which could have some quite significant impacts over the next five years. Labor is pulling the rug from money that could be co-invested in our healthcare system.

We draw on research by Deloitte, which Senator Williams so succinctly drew on in this debate, that shows that up to 1.6 million Australians will drop their private hospital cover over five years, and up to 4.3 million will downgrade their hospital cover. A recent iSelect survey found 49 per cent of people would review their cover as a result of the rebate changes. Further, the Deloitte report found that by 2016 private health insurance premiums are expected to be 10 per cent higher than they otherwise would have been. The research also shows that between 2012 and 2016 an extra 845,000 Australians would be admitted to public hospitals as a consequence of these bills before us today. Deloitte estimates that the average waiting time in public hospitals would increase from 65 days to a staggering 259 days if no additional public capital investments were made in the next five years.

The impacts of this legislation are widespread. As one example, the Australian Physiotherapy Association claims that ancillary treatment cover, also known as general treatment or extras cover, pays rebates for visits to physiotherapists and other general providers such as dentists and podiatrists. A reduction in the number of Australians holding ancillary cover will reduce access to physiotherapy and other ancillary services which are, for the most part, not covered under the Medicare Benefits Scheme. According to the Physiotherapy Association, even if a small proportion of the current private health insurance members were to drop their ancillary cover, this could have a dramatic impact on the thousands of private physiotherapy practices around Australia, and that would be magnified in the regional and country areas.

In rural Australia we are already facing a number of serious problems in the health sector and country folk do not need the additional burden of having their private insurance health rebate ripped off them. Just as those living in the cities are facing cost-of-living pressures so are those in the bush, and the means testing of the rebate represents another increased cost to rural families. For example, there is already a chronic shortage of doctors. A rural doctors workforce agency report showed that 53 doctors needed to be recruited to fill vacancies in rural South Australia alone to meet the growing demand. With all this mining going on in regions, and we are all very proud of it and all very keen for it, we actually have to service it as well. Service means doctors, and we do not need doctors' incomes being undermined by the pulling of this rebate.

Add to this the growing trend of an ageing workforce. One hundred and five out of the 423 rural GPs are over 55 years old and expected to retire within the next 10 years. In my own home town of Clare there has been a position for an obstetrics trained GP vacant for the past four years. Some people are waiting more than five weeks to see their GPs! What these people do not need is to have more money removed from their pockets when they already have average access to health services. The government's co-investment in health is and should remain paramount. Governments cannot 'rat' the budget to achieve fickle surpluses over on the economic side of their problematic government.

While only a third of all hospital beds are private, 40 per cent of hospital admissions and 64 per cent of elective surgery admissions are private. Out of the hospital network, 86 per cent of all dental services are delivered in the private sector. Clearly, the private sector has an important role to play in delivering health services to Australians under our public-private health care system. In 2010 the Productivity Commission acknowledged that private hospitals were on average more efficient than public hospitals. It also found that smaller public hospitals, many of which are located in more remote communities, were found to be less efficient than similar-sized private hospitals. Therefore, any policy change that reduces funding to the private sector, which means-testing the private health insurance rebate will do, will mean underfunding the most efficient hospitals in our country.

Even the South Australian state Labor government acknowledged the role of the private sector in supporting the entire health system. Way back in 2004 a background paper, 'Challenges for health services in rural, regional and remote South Australia: achieving better health outcomes' said:

Private in-patients in public hospitals significantly contribute to the revenue of public hospitals, as private health insurers pay costs to the public hospital just as it would to a private hospital—

It is not complicated. This basic analysis does not change over the years! That whole proposition still remains in play in 2012.

While Labor preach that this is about a fairer health system and use divisive rhetoric that private health insurance is for rich people only, some 5.6 million of the 12 million private health insurance holders have a household income of less than $50,000 per year. Clearly, private health insurance is seen as an essential part of a household's expenditure and highly valued by a significant number of Australians. While all of these households will not have the rebate removed, they will feel the impact of the changes ripple through as a result of those people who have been slapped with a rise in their health cover drop their private health insurance and premiums begin to rise. It just makes sense. Insurance is always about the money pool. If you have more people contributing, the less they have to contribute. You take people out of the pool, then the cost of cover will always increase for the remaining participants. All this on top of the extra cost of living with the introduction of a ridiculous carbon tax!

The Labor Party and Greens continue to peddle the concept that cleaners should not subsidise millionaires' private health insurance. In reality, however, low-income earners pay no tax, or very little tax, and are not subsidising high-income earners' private health insurance. The top quarter of income earners pay two-thirds of the total tax. It is just another shadowy attempt to vilify those who see in Australia the hope, reward and opportunity the coalition sees.

Now we see private health fees set to rise by another 5.06 per cent, which equates to an additional $150 a year extra for families. This means that some families will be slapped with a double-hit—higher premiums for private health insurance and less or zero government assistance via the rebate. And of course, health costs are also expected to rise because of the impact of higher energy costs associated with the carbon tax. The Treasury modelling claims health services will only rise by 0.3 per cent, but it seems inevitable that costs for patients will rise as energy, catering, key medical supplies and other input costs increase. Not only will there be pressure on the public hospital sector, but private hospital providers will also face a likely 16 per cent hike in their energy bills, all of which is likely to be passed on to consumers and patients. Where else can the pain be transferred?

Labor talk about their fairer health care, but their poor policy choices will only result in more expensive health care for all Australians and, unfortunately, it will be those on lower incomes, working Australians whom Labor claim to represent, who will be the hardest hit.

In my home state, the state where I live, where has the Labor member for Wakefield been on this issue? As a man who knows what it is like to be a working person—being a former salesman, cleaner and a trolley collector—he should understand.

Sue Boyce (Queensland, Liberal Party) Share this | Link to this | Hansard source

What—not a union rep?

Sean Edwards (SA, Liberal Party) Share this | Link to this | Hansard source

He did finish up there, but this is his earlier life. However, he has supported the Gillard government's continued assault on health care through means testing the rebate and the carbon tax. We have not heard a single utterance on private health insurance from the local member who is responsible for a seat where there are doctor shortages right throughout his rural communities. The Lyell McEwin Hospital, a very important hospital in Elizabeth Vale at the southern end of Wakefield, and the other hospitals in the electorate in Balaclava, Clare, Kapunda and Gawler are all facing substantial increases in electricity, catering and medical supply costs. The member for Wakefield, Mr Champion, certainly has not been a champion on health care for the 155,000 working men, women and children of Wakefield. The member of the House of Representatives who does not live up to his surname recently demonstrated how broken promises are the hallmark of the Labor government. The member for Wakefield last month was only too happy to stand on the same platform as his Prime Minister and welcome Ms Gillard to his electorate, nodding at every word she said when the television cameras were operating, yet within 48 hours this same individual abandoned the Prime Minister to support Kevin Rudd's leadership bid.

Cory Bernardi (SA, Liberal Party, Shadow Parliamentary Secretary Assisting the Leader of the Opposition) Share this | Link to this | Hansard source

I was appalled.

Sean Edwards (SA, Liberal Party) Share this | Link to this | Hansard source

That was quite shocking, Senator Bernardi. He witnessed all this going on in his home state.

Cory Bernardi (SA, Liberal Party, Shadow Parliamentary Secretary Assisting the Leader of the Opposition) Share this | Link to this | Hansard source

I was appalled.

Sean Edwards (SA, Liberal Party) Share this | Link to this | Hansard source

Appalled. A man whom he wanted to support, Kevin Rudd—

Jan McLucas (Queensland, Australian Labor Party, Parliamentary Secretary for Disabilities and Carers) Share this | Link to this | Hansard source

Mr Rudd.

Sean Edwards (SA, Liberal Party) Share this | Link to this | Hansard source

Mr Rudd—in his effort for leadership bid was described by some of his parliamentary colleagues as a 'psychopath'. So much for what passes for judgment within the parliamentary Labor Party. This is the same mob that tried to foist Mark Latham onto the people of Australia, then Kevin Rudd, and now they want Australians to believe—

Jan McLucas (Queensland, Australian Labor Party, Parliamentary Secretary for Disabilities and Carers) Share this | Link to this | Hansard source

Mr Rudd.

Sean Edwards (SA, Liberal Party) Share this | Link to this | Hansard source

Mr Kevin Rudd—and now they want Australians to believe that they can improve the private health system with a means test on the rebate. They might also try to get pigs to fly. Sadly, as is so often the case with Labor, this legislation represents yet another broken promise. Labor failed to have similar legislation passed in the Senate in May 2009 and again tried and failed in November of the same year. This was despite a commitment to not change the private health insurance rebate.

Let us face it: these bills are more about the ideological obsessions of the Labor Party. Because of their socialist DNA, they have a hatred of private enterprise. What pushes their collective button is the redistribution of wealth, taking it away from those families who work hard and smart to get ahead so that Labor can reward its camp followers, those who expect everybody else to pay for them. The ALP's contempt and disdain for private health funds is obvious. Class warfare is alive and well and, whenever Labor gets the chance to target the private sector, it does so. It is a big target for the Labor Party.

The ALP in 2012 has two themes: tax and spend. The thrust of its revenue gathering is to make those who largely do not vote for Labor pay more, yet in its smug arrogance that it knows better than others it does not seem to have dawned on the Gillard-Greens alliance that any exodus from the private funds because of the higher fees will lead to the overwhelming of the public hospital system.

I do not support these three bills because they will ultimately lead to an erosion of our healthcare system for everyone—increased health insurance premiums, increased demand on our already strained public system, reduced accessibility to ancillary services, increased cost-of-living pressure on individuals and families, and decreased choice for all Australians. These bills are not about better health outcomes. This is a cash clawback to fund Labor's growing and increasingly fanciful budget surplus and to cover up for their financial mischief in other areas. I will not be supporting these bills. I urge all members of the Senate not to support these bills in the interests of keeping health care in this country growing and improving for all Australians.

Sue Boyce (Queensland, Liberal Party) Share this | Link to this | Hansard source

It is interesting that the government seems to think that putting 'fair' in front of a bill title somehow makes it so. We have the Fair Work Act, which in the coalition was referred to as the so-called Fair Work Act because it is only fair in the term of this government.

Carol Brown (Tasmania, Australian Labor Party) Share this | Link to this | Hansard source

Work Choices, no choices.

Jan McLucas (Queensland, Australian Labor Party, Parliamentary Secretary for Disabilities and Carers) Share this | Link to this | Hansard source

Work Choices, no choices.

Sue Boyce (Queensland, Liberal Party) Share this | Link to this | Hansard source

There was such a cacophony of comment there. That was a unity ticket, was it, Madam Acting Deputy President?

Claire Moore (Queensland, Australian Labor Party) Share this | Link to this | Hansard source

Order! I remind senators on my right that shouting across the chamber is not parliamentary.

Sue Boyce (Queensland, Liberal Party) Share this | Link to this | Hansard source

Nevertheless, no matter how much protesting goes on from the other side, putting 'fair' in front of the title of a bill does not make the bill fair. It has been interesting to watch the development of these so-called 'fairer private health insurance incentives' bills over the three attempts to have them passed, the third of which is now being made by this government. It has ratcheted up from being allegedly good policy in the first place, through a number of iterations, to now, where the situation is the government using the politics of envy as the only reason why this legislation would be a good thing. Of course, they cannot talk about the real reason they need this legislation: they are desperate for cash, having wasted and mismanaged a surplus and having now got themselves in a situation where they have an accumulated budget deficit of $167 billion. What on earth are they going to do about it other than play semantics around the word 'fairer' and rip money in an erratic way out of any cash cow they see lying around? We do not know and, unfortunately, the Australian people do not know, but the Australian people are getting very sick of it.

Both Ms Gillard and Ms Plibersek have used the example of the poor apprentice subsidising the frontbencher, the millionaire or the billionaire through the Medicare rebate. It is quite true that irrespective of your income you get the same rebate, set at 30 per cent by the Howard-Costello government. It was deliberately set at that so there was no unfair advantage for people on high incomes over those on lower incomes. Of course, what Ms Gillard and Ms Plibersek neglect to mention when they paint their little scenario of the poor apprentice subsidising the rich frontbencher or rich minister is that everyone pays a 1½ per cent Medicare levy which is based on income; so, the more money you have, the more you pay in the levy. If you want the real picture of how health is funded in this country, you need to include both figures. No-one has any objection whatsoever to the Medicare levy being set as a percentage of income, but to try to pretend that that is a completely separate and different issue from the private health insurance rebate in terms of funding health in Australia is ridiculous and arcane.

We then move on to the grand advocates of the politics of envy, Senator Cameron and Senator Thistlethwaite, who would have you believe that only people who are millionaires and billionaires have private health insurance. It would be lovely if there were 11 million-plus millionaires and billionaires in Australia, but there are not. There are 11 million people, however, who have private health insurance, and very few of those are millionaires and billionaires. I am sure that, if the government would like to rejig this legislation so that it only applied to millionaires and billionaires, they would have no disagreement on passing it. But they want to just pretend somehow that it is not everyday Australians who have private health insurance and have it for very good reasons. They often go without in other areas so that they can have private health insurance, and they are prepared to pay the costs involved in having private health insurance. As Senator Edwards pointed out so well, if the number of people with private health insurance drops substantially, the effects on public health and public hospitals are going to be extraordinary. It is going to cost vast amounts more money. It is going to put waiting lists out extraordinarily. It is going to affect all health professionals. It is going to affect the availability of health professionals and the number of people going into professions if there is not sufficient work to make a profit.

As I said, half of Australia's 11 million privately insured people have incomes of less than $50,000. Last time I looked, that did not constitute a millionaire or a billionaire. Of those people, 3½ million have an income of less than $35,000. But the costs will continue to rise for everyone who remains in private health insurance if the government persists with their so-called fairer system.

It seems quite illogical and a little difficult to understand how on earth taking 2½ million people out of the rebate system will assist the development of private health in Australia. I listened with interest to the figures that Senator Edwards gave us on the effects on the public health system that will follow. I do not think the government care about that. I think we have here an ideological issue. Concerns about how the public health system cope are not their problem. They do not want to know how successful or efficient the private health system is; they just want to work out ways to diminish it and get rid of it—and at the same time find themselves a little bit of money to try to fix up the deficit mess they have got themselves in. There was, of course, argument. I was part of the inquiry the first time these bills came before the Senate Community Affairs Legislation Committee, which seems a long time ago now.

The modelling from the government says there will only be 27,000 people dropping their cover as a result of these changes. Some of the academics that the government lined up to follow on from this described private health insurance as 'sticky': people do not want to let go of it. No, people do not want to let go of it, but push them far enough and they will have to let go of it because the costs will rise. So the government say only 27,000 people will drop out, but Treasury, of course, did not do any modelling for them, because they did not want to know what the real answer was. But their own insurer, Medibank Private, has said that 37,000 of their members alone will drop their cover and 92,500 will downgrade. That is what the government's own private health insurance body says. If you look at the Deloitte figures, they say that in the first year you would expect 175,000 people to drop their private hospital cover and 583,000 to downgrade their cover. They say that, over five years, 1.6 million people will drop cover and 4.3 million will downgrade. They say—and this is where, irrespective of whether you earn $35,000 or not—private health insurance premiums will rise 10 per cent above what they would otherwise be. We are looking already, right now, at increases in private health insurance premiums averaging about five per cent, so we are talking about 15 per cent. Deloitte's analysis says there will be $3.8 billion in additional recurrent costs in the public hospital system as a result of these people dropping out of private hospital cover. They say that 2.8 million people with general treatment cover will withdraw and 5.7 million will downgrade over five years. And yet, of course, the grand experiment of this government continues in terms of ideological fixing.

We have not even yet spoken about the broken promises aspect of this legislation. On a quick count, there are at least seven examples of Ms Roxon, as Minister for Health and Ageing, Ms Gillard before that and then-Prime Minister Kevin Rudd promising absolutely that there would be no change to private health insurance rebates. Ms Gillard, as the shadow minister for health in September 2004, said, 'I grow tired of saying this: Labor is committed to the 30 per cent private health insurance rebate.' It is funny that she has somehow not quite managed to do that. In October 2005 she said: 'The truth is that I never had a secret plan to scrap the private health insurance rebate. For all Australians who wanted to have private health insurance, the private health insurance rebate would have remained under a Labor government. I gave an ironclad guarantee.' It goes on, of course, right up until 2009—almost on the eve of the introduction of this legislation, when the then health minister, Ms Nicola Roxon, said, 'The government is firmly committed to retaining the existing private health insurance rebates.'

Not long after the election of the Rudd government, I had a phone call from a woman who had been solemnly promised by the Labor policy secretariat that there would be no changes to the baby bonus. And yet, less than nine months—and the number is, of course, relevant—after that, the baby bonus was cut for couples over a certain income. Again we had the fallacy that somehow people with annual incomes over $50,000 are rich.

The other question that arose during the inquiry into this legislation was: if this legislation were to pass, how would health insurance companies know whether you were entitled to a rebate or not? How is that to be done? Is every Australian supposed to ring their insurer and say: 'My income for the year will be X amount. So tell me: do I get the rebate or do I not get the rebate?' Are we actually suggesting that, without any sort of coverage in the legislation—there certainly were not any answers available at the inquiry—I have to give my income to a health insurer? Is that what we are suggesting would happen? There was a vague suggestion during the inquiry that perhaps it could be done in blocks: 'Do you earn between $50,000 and $6,000' or whatever. I am sorry, but why should any Australian have to give that figure to a health insurer? It is a matter of privacy and there are no restrictions or regulations around how that would happen. Yet again we have this government getting yet more data collected up on people all over the country, for no good reason except to satisfy their own ideological whims.

I have mentioned already how the costs of private health insurance will rise because there will be fewer people, there will be fewer healthier people, in private health insurance. It would seem axiomatic, but apparently it is not, to this government. We have also recently had reports from Sinclair Knight Merz on the cost of the carbon tax for hospitals in Australia. They say that the carbon tax will add $100 million a year to health sector energy bills. In some areas the health sector is a very high user of energy. Other than that, it uses energy at similar rates to the commercial sector, with lights needing to run 24 hours a day in most parts of hospitals. You have the idea that key hospitals will have an extra $1 million-plus put onto their energy costs. So hospital costs will go up, and ambulance costs and cemetery costs are also going to rise as a result of the carbon tax, and this will come out across the board. The head of Ramsay Health Care, which is Australia's largest private hospital provider, said that they can see no way out of this except to pass on these cost increases. They expect that there will be a 16 per cent increase in their energy costs by 2013—and that is 66 private hospitals. There is no reason to think that this would not apply to the majority of hospitals, be they public or private, across Australia. Perhaps instead of stopping the poor apprentice from having to subsidise the wealthy frontbencher, this will end up being the poor apprentice subsidising the government's carbon tax, irrespective of whether they use public or private hospitals.

We are looking at a tsunami of cost increases. If public and private hospital costs are to rise and if people outside the mining industry are already suffering from a very depressed job market and depressed growth market, then, surely, what we need here is incentive for people to stay in private health, not sticks to drive them out and especially not sticks disguised as fairer ways of doing anything. There is absolutely nothing fair about this legislation except that it very fairly reflects this government's attempts to use the politics of envy to bludgeon their way through with ideology that is designed to stop incentive amongst individuals in Australia and designed to attack the private sector in every industry. I am happy to join the coalition in opposing these bills.

Nick Xenophon (SA, Independent) Share this | Link to this | Hansard source

I again rise to speak on the policy behind the Fairer Private Health Insurance Incentives Bill 2012 and related legislation. Again I oppose it. Just a few minutes ago, I had a meeting with representatives of the Australian Physiotherapy Association. What they said to me was that they are very concerned about this bill because of the effect it will have on ancillary cover, such as physiotherapy. The concern is that many Australians, because of the ham-fisted way this bill has been structured, will end up dropping out of their ancillary cover. They will still stay within a private health scheme in order not to be penalised with this carrot and stick approach, but, because of the lack of the rebate, they will cut back on their cover. Where will they cut back on their cover? On ancillary cover: physiotherapy, optometry, occupational therapy and a whole range of associated services will be left behind. Australians will not get the additional help they need on a whole range of preventative health measures, such as seeing a dietician or getting psychological help for stress. These are the sorts of things that will suffer as a direct result of this bill.

I fear this bill will have all sorts of unintended consequences for all Australians and their access to health care. One of the challenges in health is getting the right funding mix between government, private health insurance, individual out-of-pocket payments and third-party payments, all of which are important parts of our health system. It is about equilibrium and achieving an equilibrium that gives all Australians access to affordable, high quality health care. I firmly believe that private health insurance plays an important part in the mix of health funding and the delivery of health services and that as many people as possible should have access to the highest quality and affordable health care. I believe this is best achieved by the right mix of private and public health care.

I note that 45 per cent of Australians hold some form of private health insurance cover and in my own state of South Australia that number is in the order of 56 per cent. That makes a bill such as this very important as it has the potential to affect a lot of people and the decisions they make about their private health cover. The government has advocated means testing the current 30 per cent rebate on health cover on the basis of equity and sustainability. But let us analyse that. I strongly support a healthcare system in Australia that is equitable and accessible for all Australians and sustainable to the taxpayer. I do not believe that the government's proposal to means test the rebate and create a tiered health system will achieve this outcome. Rather it will create a lopsided system and damage the equilibrium between the public and private health systems. We must always be wary of unintended consequences.

As I have said before, what makes private health insurance accessible and affordable for many Australians is the 30 per cent rebate. There are many Australians below average weekly earnings who sign up to private health cover because they can see the important benefit for them. Most Australians on an average salary would struggle to afford private health insurance, especially during times when so many are struggling to balance the family budget and so many are worried about job security. Health is not something that can be taken for granted. You can see that in the almost 50 per cent of Australians who do what they can to budget for private health insurance for their wellbeing and that of their families.

In December 2009 the Productivity Commission released its report examining comparative hospital and medical costs for similar procedures in public and private hospitals, the rates for fully informed financial consent, relative performance indicators and most appropriate form of indexation. That report arose from an agreement I reached with the government when I raised concerns about the lack of information about how our health system worked, about comparative funding and even basic information on health outcomes, particularly on comparisons between the public and private systems. That was in the context of the Medicare surcharge legislation at the end of 2008. That was at a time when the way I voted did make a difference on the outcome of some legislation and I am pleased to have been able to secure that concession from the government. I thought it was a very good and valuable exercise in informing public policy in this area.

We need to reflect on some of the aspects of the Productivity Commission report. That report made it clear that both the public and private systems work best side by side. The report says:

The strength of interaction between the two sectors—

that is, public and private—

has led some to describe them as ‘interdependent’ … reflecting the fact that the services and functions of each sector help to support the other. The interaction between the sectors may be demonstrated by, for example: the sharing of resources in co-located establishments; medical staff working across both sectors and the exchange of spillover benefits (the private sector benefiting from the public sector’s investment in medical training and research).

The AMA's submission to the commission's report summarises this well in saying:

… the plural nature of the public and private hospital system is one of the strengths of Australia's health system. It is readily apparent that taxpayer sourced funding cannot bear the whole load of financing health care … Australia gets its best result when the two sectors have a strong symbiotic relationship …

My concern is that that strong symbiotic relationship will be frayed and could well be damaged beyond repair as a result of these proposed changes.

At the time of the report there were 768 public hospitals and 556 private hospitals in Australia, providing 4.7 and 3.1 million episodes of care respectively for admitted patients in 2007-08. It is a delicate balance between the two, with their services often being complementary. For example, public hospitals handled around three-quarters of all medical separations—that is, episodes of care—while private hospitals performed around 60 per cent of all surgeries and nearly 70 per cent of other procedures in 2007-08. Around 95 per cent of outpatient occasions of services, including emergency department presentation, were handled by public hospitals, while nearly two-thirds of elective surgery separations were performed by private hospitals. I think these examples show just how much the public health system needs the private health system side by side and vice versa. If even some of that demand shifted to public hospitals then before long something would have to give.

Public hospitals do a great job in providing acute care and a whole range of other care but, the more pressure you put on them, the result will be longer and longer waiting times in areas such as elective surgery and for the ancillary cover, as the Australian Physiotherapy Association quite rightly pointed out. This is a clear example of how private and public health systems do complement each other to provide better health care for Australians, and it is an equilibrium that could be put at risk if the means-testing of the current 30 per cent rebate results in people pulling out of or downgrading their private health insurance. Back in 2009, when the government first announced means-testing the 30 per cent rebate, the Treasury projected that as a result of the policy change 225,000 high-income consumers would withdraw from private cover. My concern is that higher premiums mean less affordable cover for all people, resulting in fewer people having access to private cover and putting more pressure on the public system.

The government has argued that this 25,000 figure from Treasury is inconsequential, that it would have no significant impact on the numbers of people with private health insurance cover. But the modelling that this is based on has not been tested and is not transparent. The assumptions have not been spelt out. It does not consider just how price-sensitive people are when it comes to the cost of their private health insurance going up. Also, there is no modelling at all when it comes to the issue of ancillary cover. We can explore this, I hope, in the committee stage, but if the Australian Physiotherapy Association tells me—and I accept fully what they say to me—that there is no modelling on the impact on ancillary cover then how on earth is this going to be modelled in terms of the impact it will have on the public system? How many more people will be queuing up to get physiotherapy and occupational therapy and to get advice from dietitians and psychologists—a whole range of health professionals in the public system—because people will drop out of the private system, at least in terms of ancillary cover?

Getting the policy settings right on public health insurance is very important. Sadly, the government seems more interested in getting its budget in the black by, in effect, putting household budgets in the red. The government really needs to seriously consider the consequences of this bill. I note that a number of my colleagues have mentioned Deloitte's research. Deloitte produced its report for the Australian health insurance alliance—so it is a report for an industry group, and that needs to be taken into account. But I think it is fair to say that Deloitte as a consultancy service is well respected and has done some rigorous work in this field, and the onus is on the government to rebut it. I think that what Deloitte has put up is very compelling. It talks about the fact that in the last full financial year, 2010-11, private health funds have paid $12.4 in benefits towards the health care of 11.7 million Australians who hold some form of private health cover. That is no small amount of money or people. Just imagine if significant numbers of those people—even 10 per cent—withdrew from private health cover or downgraded their cover.

Let us consider the picture that Deloitte has painted. Deloitte estimates that in the first year of a means-tested rebate, 175,000 people will withdraw from private hospital cover and a further 538,000 will downgrade. In addition, Deloitte estimates 554,000 people will withdraw from general treatment cover and another 803,000 will downgrade. Over five years, Deloitte estimates that 1.6 million people will withdraw from private health insurance and a further 4.3 million will downgrade their cover. Further, people who withdraw from their private health cover are less likely to have claimed healthcare benefits than those who choose to remain.

As people withdraw from their private cover, they become more reliant on the public healthcare system. Or, worse still, they just do not seek help, which can have catastrophic consequences for the health of those individuals. Between 2012 and 2016, Deloitte estimates 845,000 additional separations will need to occur in public hospitals as a consequence of the means-testing of the rebate. This translates to $3.8 billion in additional operating costs over five years to the public health system, with $1.4 billion in the fifth year alone. That is not a pretty picture for the future of Australia's health care system. As Deloitte says in its report:

As people withdraw from private health insurance, the burden on publically provided healthcare rises. The findings indicate that the cost of treating consumers in the public hospital system are expected to rise substantially above what is currently anticipated by Government.

These numbers I have just mentioned are staggering and highlight that, if people leave the private health system, the burden on public health care does not just rise; it escalates. We have a government that wants to get its budget in the black by in effect putting household budgets in the red.

I know the government disputes the findings of the ANOP/Newspoll survey that Deloitte's figures are based upon, but I think Rod Cameron and ANOP/Newspoll are well respected in terms of the work that they do. It is a prospect we need to seriously consider, especially when Deloitte is such a well-respected and reputable firm. A more pressured public health system with less affordable private health cover is a serious matter. It is a recipe for policy failure within a healthcare system that is neither equitable nor sustainable—the very opposite of what the government says it is trying to achieve. The government might mention that the predictions of people dropping out due to the Medicare surcharge legislation back in 2008 did not come to fruition. That is the case because the legislation was significantly amended. I think in a way that was tempered; it did not push those price sensitivity points, in a sense, with the Medicare surcharge legislation. I can foreshadow, in case we do not have time to properly debate this bill in the committee stage, that I will be moving an amendment, which I will now briefly outline. My idea for this amendment came to me after an ABC journalist at the Senate doors one morning was grilling me about whether or not I would support an independent body for collecting information on the composition of health funds, which I think I alluded to. George Roberts was the journalist, and I am not sure that the ABC wants to be pulled into policymaking, but I am grateful to Mr Roberts for his question because it has led to me having an amendment drafted, which I will name the 'Roberts amendment,' which probably horrifies Mr Roberts.

The amendment I propose is that the Productivity Commission, in its independ­ence, reports annually on the composition of private health funds. It is vital that we know from an independent source just how many people drop out of private health insurance or reduce their cover as a result of means-testing the 30 per cent rebate. I believe that the Productivity Commission is well placed to do this, particularly given its previous report that comprehensively looked at the mix between the public and the private health systems. By reviewing annually the composition of health fund membership we will be able to see precisely just how many people drop out or downgrade their membership. It is almost a rule of public policy that there will always be unintended consequences, and in this case it is important that these consequences be monitored, because I believe they could well be severe. That is why it is essential to have the Productivity Commission take on the role of monitoring the impact of these changes.

My question, respectfully, to the government will be: if the government does not support the amendment in its current form, what assurances can it give to this place, to the people of Australia, that there will be a mechanism to monitor the number of people dropping out or downgrading their cover? The downgrading of cover is where I think the sting is in the tail with this piece of legislation and the impact it will have. I would be grateful if the government could provide me with a comprehensive answer in relation to that. Surely there must be some responsibility mechanism, an independent and robust mechanism, to determine what the impact will be.

I believe we owe it to the Australian people to not take risks with their health but to give Australians the options they need to get the best possible health care and to give Australians a healthcare system where private and public work side by side in a symbiotic relationship, complementing each other to achieve the best health outcomes. This legislation does not do that.

Fiona Nash (NSW, National Party, Shadow Parliamentary Secretary for Regional Education) Share this | Link to this | Hansard source

I always think that the Australian people are very positive and are always looking for the bright light at the end of the tunnel. They have a positive outlook on the future of Australia, which is why they get so incredibly frustrated and disappointed that this Gillard-Rudd-Smith-Shorten-Carr-Greens-Independent Labor government keep giving the Australian people such bad policy. I had better correct that. I was referring to Senator Bob Carr and not Senator Kim Carr; Senator Bob Carr is clearly the smart one.

We have the Australian people in the situation where the government is continuing to foist upon them bad policy. It is happening time and time again. As I travel through mostly regional communities, there is a sense of a lack of confidence in this government that it can actually deliver anything properly for this nation. As somebody said to me the other day, 'This Labor government is choking this country,' and it is. It is doing it because there is so little good policy, substantive policy, that we see coming from the government. This private health insur­ance legislation is absolutely no different.

Isn't it interesting, colleagues, that on the other side of the chamber with the Labor government over there and in the other place, they are continuing to harangue the coalition and harangue the leader, Tony Abbott, about being negative and about saying no. If the government could at any stage give us some good policy for the Australian people, we would not have to keep saying no. The only reason we are saying no is because the government continue to give us such bad, ill-thought-through policy on the run. We only have to look at the private health insurance legislation before us to see yet another example of this.

It is just stupidity to take away the incentive and place an impost on the Australian people which is going to lead to them dropping their private health cover and is going to push them into the public system. That is just completely stupid. The public system is already completely overloaded. I take my hat off to the men and women, the doctors, the nurses and staff, in our public health system who work so hard in very, very difficult situations. But here we have a government that is planning on making it more difficult for those health workers, making it more difficult for the public system to cope because it is planning to put more pressure on that system through the people who are going to leave private health insurance. It is just completely illogical for the government to come up with a policy that says, 'We're going to make things even worse for the public health system.' The health system cannot bear any more; it is at stretched point. There is no doubt about that.

What else are we going to see? We see a deterioration of the risk pool. What is that going to do? That is going to increase premiums for those still remaining in private health insurance. The government come up with arguments that they think are appropriate for why this should be happening, but at the end of the day it is going to put costs up for those people who are going to remain in the private health system. It is interesting, isn't it? We often see the Labor government implying that private health insurance is for the rich. It is not. It is actually for people who are taking the opportunity to make sure that they have the financial support they need at times when their health is at risk. That makes sense, and that is why we brought it in in the first place. But this government is prepared to say that private health insurance is for the rich.

It is interesting: 5.6 million people with private health insurance have an annual household income of less than $50,000, and 3.4 million have an annual household income of less than $35,000. I know that the government will argue that that does not apply under the changes. But it does. By association, by those risks that are put in place, the costs are going to go up for people remaining in private health insurance, because of the critical mass of people who will now shift out of private health insurance into the public system. Those people will be affected, and they will be affected quite badly. So for the government to say in any way shape or form that those people are not affected is simply untrue.

When we look at the Medicare system and how it is going to be impacted by this, it is just extraordinary that the government clearly does not realise what the impact of this is going to be. I take Senator Xenophon's point that he made earlier about unintended consequences. I think that there are going to be many. Coming back to my initial point, the government is simply not thinking through policy properly. And, as Minister Conroy has just joined us, the NBN is a classic example of policy that has not been thought through properly—but I will get to that a little bit later.

I also just want to touch on another point that Senator Xenophon raised, about ancillary cover. This is the importance of allied health and the fact that the work has not been done to see what the impact is going to be from the resultant changes on those who have ancillary cover now. This is a real problem. It is going to be a real issue, particularly for regional communities, where getting access to allied health is a real problem, as my good colleague Senator Macdonald would know very well. So what impact is this change going to have on the provision of those services, particularly to people in regional communities?

I doubt that the government has an answer. Perhaps, if we have time, during the committee stage we may be able to get some kind of response from the government—perhaps a few moments here or there, seeing that they are keen on guillotining just about everything at the moment. But what impact is that going to have? I suspect that the government have absolutely no idea what that impact is going to be. I suspect that the government have not even considered it, because it has become quite obvious over many months and years of Labor government now that the government simply do not understand regional Australia. They do not understand the impact that their bodgie, ill-thought-through policies are having, particularly on our regional communities.

When we look at the changes and the direct analysis of what this is going to do, there are going to be 2.4 million people directly affected with the immediate increases in the premiums at 14 per cent, 29 per cent and 43 per cent in the respective income tiers for those under 65. Isn't that interesting? Reflecting on what I said before, I will just quote the shadow minister, Peter Dutton, because I think he put it very clearly: 'There are 12 million Australians who have private health insurance. It is not the playground of the rich, because, of that 12 million, almost six million people are on incomes of less than $50,000, and over time everybody's premiums will go up if you drive the healthy and the young out of private health insurance.' It says it all, really, and the government clearly do not understand that implication. They clearly have no understanding, even though the government owned insurer, Medibank Private, predicted 37,000 of their members alone will drop their cover and that 92½ thousand will downgrade.

I know that many of my colleagues have quoted the Deloitte analysis, but I think it is worth while doing it again. In the first year, 175,000 people would be expected to withdraw from private hospital cover and a further 583,000 to downgrade it. Over five years, 1.6 million will drop cover and 4.3 million will downgrade. Private health insurance premiums will rise 10 per cent above what they would otherwise be, there will be $3.8 billion in additional recurrent costs for the public hospital system and there will be $4.6 billion in revenue removed from the private sector as a result of consumers withdrawing and downgrading their private health cover.

How can anybody look at those facts and think that this is any kind of sensible, balanced, well-thought-through policy whatsoever? You cannot. You simply cannot do that. Again, the government in its inability to properly think through policy has come up with yet another dog. Why should we be surprised, colleagues? We have had years and years of shambolic policy from this government, and this is just another example.

I think it is worth while, for the benefit of the Senate and those who may be listening, running through some of those shambolic policies to show the form that the government has in its absolute inability to govern this country properly. Firstly—and I know that my very good colleague Senator Cash will know all about this one—Labor's failed border protection policies, which have blown out the immigration budget by around $4 billion over the last three years and where more than $5 million has been spent on preparing the government's abandoned Malaysian people swap deal. I have to commend Senator Cash for the work she has done in this area. Very few people understand it better than she does. But what a mess! What an absolute mess! And it is all the fault of this government. It changed a policy that was working. There were no boats. And yet now we see from this government an absolutely shambolic piece of policy that has resulted in the chaos that we have when it comes to our border protection.

And who could forget the Home Insulation Program, the pink batts? There was $2.5 billion mismanaged, with at least $500 million to be spent fixing the mistakes. Computers in Schools: a $1.4 billion blowout and way behind schedule. Green Loans and Green Start: $175 million for the Green Loans Program mismanaged and then eventually dumped, then replaced with the $130 million Green Start program that never started! The solar homes program: $850 million blowout and the program cancelled. The program was originally meant to cost $150 million. There was the set-top box program at an average of $350 a home, but interestingly—

Stephen Conroy (Victoria, Australian Labor Party, Deputy Leader of the Government in the Senate) Share this | Link to this | Hansard source

Why do you hate pensioners? You voted for it, you hypocrite! You voted for it!

Fiona Nash (NSW, National Party, Shadow Parliamentary Secretary for Regional Education) Share this | Link to this | Hansard source

Ah—good to see you have woken up, Minister. Just let me finish and we will come back to that later.

Let us have a look at Harvey Norman. Gosh, they are offering the same deal for $168. Hm, let's see: government, $350 a home and Harvey Norman, $168. It does not seem to really stack up that well, does it, colleagues?

Senator Conroy interjecting—

Louise Pratt (WA, Australian Labor Party) Share this | Link to this | Hansard source

Order! Senator Conroy!

Fiona Nash (NSW, National Party, Shadow Parliamentary Secretary for Regional Education) Share this | Link to this | Hansard source

Absolute mismanagement! And then we get to the Labor talkfests—

Senator Conroy interjecting—

Louise Pratt (WA, Australian Labor Party) Share this | Link to this | Hansard source

Senator Conroy, please come to order!

Fiona Nash (NSW, National Party, Shadow Parliamentary Secretary for Regional Education) Share this | Link to this | Hansard source

Speaking of talkfests, we can see why they do that. Senator Conroy is having a good go from the other side. Labor's talkfests include the 2020 Summit for $2 million, the Henry tax review for $10 million, the tax summit for $1 million and the jobs summit, but with hardly any outcomes. Here are two the people of Australia were absolutely enamoured of: Fuelwatch and GROCERYchoice! Weren't they great? Remember those, colleagues? Fuelwatch was going to fix the problem! GROCERYchoice was going to fix the problem! Nearly $30 million was spent setting them up, and then what happened? Any good outcomes? Let me see. No. Oh, gosh. What happened? They were dumped—$30 million and they were dumped. I am sure there are plenty of people in regional communities who think that $30 million could have been much better spent out in the regions, but no; we had it for Fuelwatch and GROCERYchoice.

Then, of course, there is Senator Conroy's NBN. What was that? Was it $4.7 billion to start with, blown out to more than $50 billion? The other thing is: was there ever a proper business case to justify the spending? Let me see, colleagues. Guess what the answer is: clearly no. This is yet another example of policy on the run from this government, which is simply inept. It cannot run the country. I have people saying to me they just wish we had a grown-up government that was able to run the country properly.

We saw the absolute debacle of the live cattle export trade. The fact that the government, panicked and on the run, shut down the live export trade was absolutely appalling and an indictment of this government, and it was yet another example of the government's complete lack of understanding of regional Australia. I say to those on the other side that if they had been travelling around during the inquiry, talking to the people on the ground and seeing how that stupid, stupid decision affected people in their homes and businesses then they would know that they are simply inept.

In all of this, we also see the government promise 64 GP superclinics. They have delivered 19 and scrapped two in the process. Here is my particular favourite—this one I love. We were talking about waste, mismanagement and government being inept. The government sold the parliament­ary billiard tables for $5,000 and then spent $102,500 finding out whether we got true value for money. If that does not encapsulate the absolutely inept nature of this government and its absolute inability to run the country properly, I do not know what does.

What really gets to people is being lied to. They really are starting to get hot under the collar, because every single time they turn around something else comes out from the government that is yet another backflip, another lie or another untruth, and they are sick of it. These are people out there in the communities—particularly, as I say, in regional communities—that I am talking to and that are trying to bring up their children, run their families, homes or businesses and instil in their children good ethics about how not to lie, how to be straight and how to tell the truth, and then they look at this government and every single time they turn around there seems to be another untruth.

I know some of my colleagues have raised these already, but as examples of the fact that you cannot trust this government these are absolute corkers. When it comes to the private health insurance legislation, we look at the then health minister, Nicola Roxon, saying on 24 February 2009:

The Government is firmly committed to retaining the existing private health insurance rebates.

Mr Kevin Rudd said on 25 February:

The Private Health Insurance Rebate policy remains unchanged and will remain unchanged.

This is Mr Rudd again, in 2007:

Both my Shadow Minister for Health, Nicola Roxon, and I have made clear on many occasions this year that Federal Labor is committed to retaining the existing private health insurance rebates, including the 30 per cent general rebate and the 35 and 40 per cent rebates for older Australians.

One perhaps thinks that if Mr Rudd had got a few more votes then maybe we would not be having this, but who would know? That is a story for another day that I suspect may well come back another day. Then we look at the now Prime Minister, Julia Gillard, saying back in 2005:

The truth is that I never had a secret plan to scrap the private health insurance rebate … For all Australians who wanted to have private health insurance, the private health insurance rebate would have remained under a Labor government. I gave an iron-clad guarantee of that during the election.

The difference between Tony "rock solid, iron-clad" Abbott and me is that when I make an "iron-clad commitment", I actually intend on keeping it.

Absolutely extraordinary. They are the words out of the mouth of the woman who is now the Prime Minister of Australia, who has put the private health insurance legislation in front of us today.

So how on earth can anybody across this country believe anything this shambolic Labor government says? They heard those words coming from the Prime Minister in 2005. Obviously she was telling an untruth, because we now have changes to private health insurance in front of us. What does that do for people? That twigs another memory and another recognition from before the last election which goes something like, 'There will be no carbon tax under the government I lead.' This is the Prime Minister of Australia, Julia Gillard. What are we having in about 109 days from now? A carbon tax. What is that carbon tax going to do? It is going to hurt every Australian, and it is going to hurt regional Australians harder than anyone else. It is going to hurt our farmers harder than virtually anyone else, with fuel, electricity, fertiliser and transport costs right across the board, and those farmers have nowhere to pass those costs onto. That is only a little more than 100 days away. We sit on this side of the chamber looking at the other side, at the government, every day and saying: 'You are appalling. You have no ability to run the country. You are completely inept.'

We see again with this piece of legislation in front of us the inability of this Labor government to properly think things through, to properly look at the consequences of its actions and to properly provide decent, sound, well-thought-through policy for the people of this nation. Colleagues, I tell you what: Australians around this country are fast, fast coming to the conclusion that this government is unable to run this country and it is time for a change.

Ian Macdonald (Queensland, Liberal Party, Shadow Parliamentary Secretary for Northern and Remote Australia) Share this | Link to this | Hansard source

I want to commence my contribution to this debate on the Fairer Private Health Insurance Incentives Bill 2012 and the associated bills exactly where Senator Nash finished off, and that is by quoting our current Prime Minister, the leader of the Labor Party, who said this in a letter to the Hobart Mercury:

I grow tired of saying this—Labor is committed to the 30 per cent private health insurance rebate.

That was said by our Prime Minister. How can any Australian trust anything this person says? Indeed, how can any Australian, or Queenslander, accept anything any Labor Party leader says? Ms Gillard again, writing to the Courier-Mail in Queensland, responding to another letter to the editor, said:

YOUR correspondent … should have no concern that Labor will "erode" or abolish the 30 per cent government rebate for private health insurance. Labor is committed to the maintenance of this rebate and I have given an iron-clad guarantee of that on a number of occasions.

That is our Prime Minister. What an embarrassment to Australia that person is. You simply cannot believe anything she says. We all know—it is part of the lexicon now—that Ms Gillard promised, just before the people went to the polls at the last election, 'There will be no carbon tax under a government I lead.' And in a few short days that tax, which has already passed through this parliament, thanks to the Labor Party and the Greens political party, will be imposed upon all Australians—the greatest carbon tax in the world.

As my colleagues have clearly demonstrated, once you remove this rebate people will drop out of the private health insurance system and they will then rely more and more on public hospitals. I cannot talk about public hospitals elsewhere in Australia, but I can talk about the public health system in Queensland, which is an absolute shambles after practically 22 years of Labor rule in Queensland. Do not take my word for it; just go online and google 'Wikipedia Queensland Health', and you will see a litany of the way that Labor cannot run the public health system as it is. In my home town of Townsville, there is a great set of staff at the Townsville general hospital—very dedicated doctors and nurses—but there are never enough of them. And of course the nurses are not very happy because they do not get paid in Queensland because the Labor government in Queensland simply cannot even arrange the payroll for the nursing staff in Queensland Health. This is a typical Labor government administration of health, and it is a typical Labor government administration of the country's—or, in my case, the state of Queensland's—financial system.

In Queensland we had an announcement by Ms Bligh, the leader of the Labor Party there and the current—for another couple of weeks—Premier of that state, that she was going to abolish Queensland Health. She was going to get rid of it; she was going to cut it into two and restructure it. That followed the incident where a supposed Tahitian prince just cleared off with $16 million from Queensland Health. He had been rorting the system for years, but no-one in the Queensland Labor government had any idea of that. Their administration of health in Queensland is legend, and it is legendarily bad. Yet it is to this system which the current federal Labor government, which promised never to interfere with the 30 per cent private health insurance rebate, is going to send Queenslanders. This federal government, by taking away the private health insurance rebate, will indeed send more people to the public health system, which, in Queensland, is almost like sending people to their greater detriment, and, in cases where you are dealing with matters of life and death, could be sending them to a more terminal future. That is what this legislation will do.

Time is not going to allow me to go through how the public health system in Queensland will become more overtaxed as a result of this legislation. But now that I see that a number of Labor members have come into the chamber to hear me make this speech, can I just repeat again, in case they did not quite hear me before, this quotation from the Labor Party leader, and our current embarrassment of a Prime Minister, Ms Gillard, who said:

I grow tired of saying this—Labor is committed to the 30 per cent private health insurance rebate.

Can I also repeat what Ms Gillard said in responding to a letter to the editor of the Courier-Mail in my state of Queensland:

YOUR correspondent … should have no concern that Labor will "erode" or abolish the 30 per cent government rebate for private health insurance. Labor is committed to the maintenance of this rebate …

Can I repeat that, Mr President?

Labor is committed to the maintenance of this rebate …

And she goes on to say, in writing:

… I have given an iron-clad guarantee of that on a number of occasions.

Can you believe anything this Labor leader will say? Can you believe anything the Labor leader in Queensland will say when it comes to health ministers? Can you believe anything any Labor member will say? The evidence, the examples, of Labor leaders telling untruths in making commitments is legend. And I fear for my state of Queensland that the Labor leader there will be, as I speak, up in Queensland promising everything to everyone. She will be promising, probably, not to sell the railways—

Senator Furner interjecting—

And you, Senator Furner, should know. Did you agree with the sale of the railways when they promised not to do it? Of course you did. What a disgrace any Labor leader is. You simply cannot believe them.

Debate interrupted.