Julia Gillard (Lalor, Australian Labor Party, Deputy Prime Minister) Share this | Link to this | Hansard source

Mr Speaker, I wish to make a personal explanation.

Peter Slipper (Fisher, Liberal Party) Share this | Link to this | Hansard source

Does the honourable member claim to have been misrepresented?

Julia Gillard (Lalor, Australian Labor Party, Deputy Prime Minister) Share this | Link to this | Hansard source

Yes.

Ms Anna Burke (Chisholm, Deputy-Speaker) Share this | Link to this | Hansard source

Please proceed.

Julia Gillard (Lalor, Australian Labor Party, Deputy Prime Minister) Share this | Link to this | Hansard source

There are claims in the Fairfax papers today that I was made aware of more extensive dealings between the member for Hunter and Ms Helen Liu. This is incorrect. In late March last year, my former chief of staff was contacted by a solicitor at Slater and Gordon. No specific allegations were raised. A subsequent email was sent, containing a photograph of Mr Fitzgibbon on a plane with an unnamed Chinese gentleman. No words or allegations were contained in the email. The government made appropriate checks and, given the lack of specific allegations and no supporting documentation, determined that no further action was required.

Steven Ciobo (Moncrieff, Liberal Party, Shadow Minister for Youth and Sport) Share this | Link to this | Hansard source

I am pleased to rise to speak of the coalition’s point of view—and in particular, I would suggest, that of my electorate—with respect to Labor’s proposed changes under the various bills that are part of this cognate debate today, the Fairer Private Health Insurance Incentives Bill 2009 [No. 2] and the others. In summary, we have before the House again a number of bills that the Labor Party is insistent upon trying to ram through this parliament—bills which go to the very essence of private health insurance in this country. If you look at the journey that Australians have had with respect to private health insurance over the last several decades, there are a number of clear trends in place. The most obvious of those trends is that private health insurance has always been adopted by more Australians under the coalition, and the reason for that is effectively underpinned by ideological belief. Those on this side of the chamber hold the view that, if Australians can afford to provide for their own health cover, they should be encouraged to do so. That point of view stands in contrast to that of the Australian Labor Party, where a very different attitude exists about private health insurance.

We know that deep in the warm bosom of the Australian Labor Party they hold and nurture the view that we should have a global public health system that does not register any difference between multimillionaires and those who unfortunately face the very toughest challenges in Australian society. It is a very different point of view to the coalition’s. The coalition’s view is that our public health system should serve the public but that those that can afford to pay or those that choose to pay for private medical insurance should be encouraged to do so. Fundamentally, the reason for that is a very simple belief, and that is that our public health system already labours to meet the demands of the Australian population. Given that the public health system already labours to meet the high level of demand in the Australian population, why would you seek to put more people into the public health system and make the problem even worse?

That is the fundamental difference in policy between the coalition’s approach—both under the previous Howard government and even before that, in the eighties under Fraser—and the Australian Labor Party’s approach, which attempts to tear down those incentives for Australians to provide for their own private health insurance where they can afford to do so. The Labor Party have the misdirected belief that by doing so they are in some kind of dogged pursuit of ideological nirvana that sees that we should have one health system for all, no matter how bad it is. So what we have before the House in the bills today are a number of policy changes that directly attack private health insurance in this country under the guise of reforms by the Australian Labor Party that will apparently make it a more egalitarian system.

I talk about my own electorate when I consider an issue like this. The Gold Coast is Australia’s sixth largest and fastest growing city. We have a woefully inadequate public hospital on the Gold Coast, in the form of the Gold Coast Hospital in Southport, and a number of satellite health centres that are publicly funded. I do not know the exact number, but I would suggest that it is a hospital that was built and designed to service a city of probably around about 200,000 people, which is a far cry from the 500,000 that currently reside on the Gold Coast. Granted, thanks to both Commonwealth and state government funding, there is a new hospital being built, albeit years late because of the ineptitude of the state Labor government and their inability to ever deliver a single project on time or remotely on budget. That notwithstanding, I think people will accept to some extent that the Queensland state Labor government has a long and unfortunately very undistinguished track record of botching public projects. The new Gold Coast hospital is just the latest in a long list, so people are not surprised that it is now some three years overdue.

But that notwithstanding, there is an important principle that exists in the city in which I live and which I have the privilege of representing. That principle is that there are large numbers of people prepared to pay for their private medical insurance. There are possibly two reasons for that. The first is probably a great degree of scepticism about whether or not the public health system will meet their needs. The second reason that large numbers choose to take out private hospital cover may be that they like the fact that they can choose their doctor in the private system. But that notwithstanding, roughly 50 to 55 per cent of my electorate has private medical cover.

The Southport public hospital is frequently on bypass. In other words, it cannot cope with the demand for its service, so if you have some kind of medical emergency the ambulance actually drives past Southport hospital to go to the next hospital down the road, which in some instances is on the south side of Brisbane. When that hospital already struggles all too frequently with the challenge of being overcrowded and not able to cope with demand, we now have this brilliant and inspired decision by the Australian Labor Party to put more people into the public system! It is going to do that by making private health insurance less affordable. By jacking up the price of private health insurance, the Australian Labor Party somehow and bizarrely thinks that it is going to make the public system better. By making it more expensive and therefore triggering, we estimate, somewhere in the vicinity of one million Australians to transition from private health insurance to the public health system, the Australian Labor Party thinks it has achieved some kind of policy goal. What a strange set of policy goals that Labor would seek, to undertake such a ridiculous course of action in pursuit of ideological dogma.

From time to time we get members of the Australian Labor Party who claim that this is all being done as a savings measure for the government. They have said that they need this policy and they need these laws to go through to savage private health insurance in this country to save the government money. This is a government that has wasted nearly $3 billion on cost blow-outs under the so-called Building the Education Revolution, the pink batts program and the computers in schools program. There have been nearly $3 billion in cost blow-outs by these lazy, incompetent economic managers. But, that notwithstanding, they will still seek to penalise roughly one million Australians and to push them from private health insurance into the public system. As a responsible alternative government we have said to the Labor Party, ‘Offset the impact of our proposals, or rather our refusal to adopt Labor’s failed and short-sighted proposals, by increasing tobacco excise.’ By raising tobacco excise you completely offset the cost of our opposition to the government’s moves. So we are responsible. We say tax those who are a massive burden on the health system—that is, smokers; because they are a massive burden on the health system—and increase tobacco excise. That will raise $1.9 billion over the forward estimates, which completely offsets the cost of our refusal to adopt this short-sighted policy change from the Australian Labor Party.

When I talk to those 50 to 55 per cent of residents in my electorate who currently enjoy private health insurance I cannot possibly argue to them why I would ever support such a harebrained scheme as Labor’s proposal, which will probably result in that figure dropping into the mid-30 per cent range or something like that. I am very happy to outline to them why I stand opposed to it. They understand innately that the consequence of this policy change that Kevin Rudd and Labor are introducing will be that already very long public hospital queues will get even longer. They understand that, because they cannot get an elective surgery operation when they have been on the waiting list for 12 months already, it is going to get even worse as a result of these changes. My constituents innately understand that. That is why I have, with a high degree of confidence, the view that they support the coalition’s opposition to Labor’s proposed health insurance reforms.

There is another issue of principle here—that is, ahead of the last federal election we saw Kevin Rudd and other members of the government frontbench out campaigning on the road, hand on heart saying, ‘The buck stops with me.’ We all remember those immortal words that were uttered by the Prime Minister. ‘The buck stops with me,’ he said. ‘When it comes to fixing the public health system, Australians if they elect me can rely on me to fix it. The buck stops with me.’ That is what he said. And here we are two years since the Rudd Labor government was elected and what has happened? The public health system has gotten worse. The buck never stopped with Kevin Rudd; that is for sure. It just went straight past. We have a public health system that is crippled by this government’s ineptitude. It is no surprise because the same ideological dogma that plagues the Labor Party at a state level and that has caused so many mistakes, problems and such mismanagement at a state level has now been embraced by Canberra. We have the same failed policies in public health that exist at the state level now being brought to Canberra. So it is no surprise that we see our public health system lurching from crisis to crisis.

I want to say that I hold in the highest regard the doctors, the nurses and the allied health professionals who work in our public health system. Indeed I have immediate family members who work in the public health system. I admire not only them and the work that they do but also all those in the public health system who work in hospitals and in other auxiliary services, who provide first-class services in the main. But that stands in contrast to the bloated bureaucracy that lies behind it. Comments are frequently made to me by those who have had an interaction with the public health system. They often say to me that for every doctor they saw, they saw about five or six managers, bureaucrats or people doing paperwork—people not delivering front-line health services but actually sending memos to each other for whatever reason; we do not know. When you look at the billions of dollars of taxpayers’ money that is shovelled into the public health system you do not see it on the front line helping the doctors and nurses; you see bureaucracies that get bigger and bigger and bigger.

Queenslanders remember the great fraud that was perpetrated by the state Labor health minister. A number of years ago the then state Labor health minister stood up and said that he had achieved great reform of waiting lists in the Queensland health system. He held up statistics and talked about how the waiting lists for elective surgery had declined so rapidly under the Labor Party in Queensland. But, you know what? It was not long thereafter that the truth was uncovered. What we uncovered, unfortunately, in Queensland was that they had simply introduced a waiting list to get onto the waiting list. So there were two waiting lists and by pushing people from the waiting list that was measured and accounted for previously they were able to make it look as if the waiting list had become smaller when in reality there was now a second waiting list that patients were stockpiled on. It was almost like a traffic gridlock as they waited for months and sometimes years on the pre-waiting list to get onto the waiting list. Then they waited months and sometimes years to have the surgery. So it is no wonder that when the former coalition government gave people an incentive through the 30 per cent health insurance rebate to embrace private health insurance the level of private heath insurance coverage in this country skyrocketed from down in the 30 per cent range up into the 40 per cent or 50 per cent range. It did so because people wanted to be in the private system because they had confidence in the private system.

The bills that are before the House will do great damage. They will do great damage because they will force another million Australians, or thereabouts, from private health insurance onto the public system. You can look any Australian in the eye and they will understand when you say to them: ‘This is bad legislation. Do you think that the public health system can deal with an extra one million people waiting in its queues, waiting in its emergency departments and waiting for elective surgery?’ The answer overwhelmingly will be, ‘No, we don’t believe it.’

I know the Minister for Health and Ageing will stand up and say: ‘But, hang on, we’re going to pour billions of dollars of extra funds into the public system. It’ll be okay. Trust us.’ There is such a litany of failure at a state level by state Labor governments who, hand on the heart, have said exactly those words that it is no wonder Australians are cynical about Labor’s ability to manage money. If there were genuinely improved patient outcomes and benefits that flowed—and that will now flow with additional funds, Labor will claim—as a consequence of the billions of dollars of taxpayers’ funds put into the public health system, people might be more understanding. But the truth is that the track record of this government, like that of state Labor governments, is one of abject failure when it comes to improving the health system.

More importantly, why would anyone in their right mind truly believe that the health minister or the Prime Minister is actually going to do anything beyond political spin when it comes to improving the public health system? Bear in mind that these same two people, before the last election, went around hoodwinking the Australian people, saying, ‘The buck stops with me and we’ll fix the public system.’ Here we are two years later and nothing has changed.

The simple challenge from the simple task that lies ahead for the Minister for Health and Ageing and for the Prime Minister is to get back the confidence of the Australian people that change will take place. Nothing has happened in two years. Talk of throwing billions of dollars of extra money at the problem will not change. It has not in the past, so why will it suddenly change now? Until rock solid guarantees and KPIs are put in place, the Labor Party should steer away from driving a million people or thereabouts into the public health system. More importantly, the Labor Party should embrace the coalition’s proposal to completely offset the costs of this measure through increasing tobacco excise. That achieves, on even the most straightforward principle, two key outcomes: firstly, it creates a greater disincentive to engage in an unhealthy habit—that is, smoking—and, secondly, it is economically responsible by making sure that the coalition’s opposition to this bill does not have an impact on the budget bottom line.

I am happy to stand here on behalf of my constituents in Moncrieff, the people in Gold Coast City, who are already lumbered with a substandard public health system due to the fact that it is woefully inadequate for a city of 500,000. It is a city which incidentally—and I will take the opportunity to highlight this while the health minister is here—had funding for a large number of its after-hours medical services cut by this government because the government said that it would pursue GP superclinics as its solution. Do you know what? This is the sixth largest city in the country, with 500,000 people, and there is not one GP superclinic from this government.

Nicola Roxon (Gellibrand, Australian Labor Party, Minister for Health and Ageing) Share this | Link to this | Hansard source

Ms Roxon interjecting

Steven Ciobo (Moncrieff, Liberal Party, Shadow Minister for Youth and Sport) Share this | Link to this | Hansard source

Now the minister says that is because we oppose it. So apparently GP superclinics can spring up all across the country, but, where the opposition opposes it, it does not happen—

Nicola Roxon (Gellibrand, Australian Labor Party, Minister for Health and Ageing) Share this | Link to this | Hansard source

Madam Deputy Speaker, I rise on a point of order. I have tolerated a long stretch from the debate. This is not relevant. But I also will not be verballed. That is not what I said. He cannot now ask for a superclinic when their position is to oppose all GP superclinics. Now he is actually asking for one in his electorate, which I note.

Steven Ciobo (Moncrieff, Liberal Party, Shadow Minister for Youth and Sport) Share this | Link to this | Hansard source

Now I am out of time.

Danna Vale (Hughes, Liberal Party) Share this | Link to this | Hansard source

I thank the member for Moncrieff for his contribution.

Nicola Roxon (Gellibrand, Australian Labor Party, Minister for Health and Ageing) Share this | Link to this | Hansard source

in reply—I thank the members for their contribution to this debate. I must admit that the member for Moncrieff did not really take the opportunity to talk about anything particularly relevant to the Fairer Private Health Insurance Incentives Bill 2009 [No. 2] and cognate bills, but I am pleased that he has put on the record his request for a GP superclinic in his area, something that until today he has been vehemently opposed to. We will note his request for that proposal to be expanded into his electorate.

I am pleased to be summing up on these bills, which are very important to us. I am a little disappointed that those opposite who took the opportunity to speak did not really come up with any decent reason for opposing these bills and unfortunately filled their speeches with a whole range of mistruths, including some of the highlights like ‘nothing having happened in two years in health’, when actually we have been rebuilding block by block our health system after the current Leader of the Opposition spent all of his time in government pulling investment out of our health system, capping GP places, ripping a billion dollars out of public hospitals and neglecting our workforce shortages.

I think it is interesting that the member for Moncrieff and others are still using the entirely discredited figure of one million people being anticipated to move as a result of this measure into the public hospital system. Even the private health insurers themselves agree that that figure is no longer credible, and I am surprised that the Liberal opposition are continuing to use these figures.

These bills, a combination of three bills, give effect to our 2009-10 budget measure to introduce three new private health insurance incentive tiers for the rebate. These bills have previously been debated in the House, and after previously being passed in the House were defeated by the Senate at the second reading on 9 September. This legislation is needed to bring fairness to the private health insurance rebate. We believe that reforms are needed to make the rebate sustainable for the future.

The Senate, by taking the action that it did, dismissed one of the government’s key measures to appropriately deal with the global financial crisis. Its obstruction of the government’s budget and the defeat of these bills has caused a $2 billion impact to the budget over the forward estimates. Treasury estimates that, if the bills are not passed, that will increase total health spending by the middle of the century—that is, 2050—to 0.15 per cent of GDP, or by about $100 billion over that period. That is why the government has reintroduced these bills to the House and, after members’ consideration, will be submitting them to the Senate once again.

Government support for private health insurance needs to be directed to those hardworking Australians who need the assistance most, not the high-income earners who do not. Hairdressers, secretaries and taxi drivers will continue to receive benefits but not millionaires or politicians, who do not need it. Importantly, the vast majority of people keep their benefits. It is estimated that 90 per cent of Australians with private hospital cover will be totally unaffected by these changes. The government does support a mixed model of financing and delivery for health services in Australia, but, as the Intergenerational report highlights, private health insurance is going to be the fastest growing aspect of this health expenditure. As I have said, the Commonwealth cost of the rebate—and these figures have been released previously—has ballooned over the past decade from about $1.5 billion in 1999-2000 to $4 billion last year. This spending is not sustainable, particularly in light of the global financial crisis. Since the 2008-09 budget, tax receipts have been revised down by $170 billion, and the $2 billion of net saving in this package will ensure that the government’s commitment into the future for the rebate remains sustainable. I am pleased that the shadow health minister is here. Someone who previously had a role of some financial responsibility in the former government would be very aware that these figures presented a great problem for the budget, for the community and for the sustainability of private health insurance in the past, something that the new opposition finance spokesperson is clearly aware of and the reason he is leaving open the option of supporting this measure when it comes into the Senate.

The way that we can still maintain a high level of insurance is by using the other levers that we have, such as the Medicare levy surcharge and Lifetime Health Cover. A key element of the way this package of bills was designed was to ensure that Australia does maintain a high level of private health insurance membership. In fact, 430,000 more people have taken out private hospital cover since this government was elected, and the opposition’s claims that previous changes were going to lead to a massive decline of people in private health have been shown to be patently incorrect. In fact, the reverse has happened. The opposition at the time inaccurately claimed that previous bills would have an impact, and now they are crying wolf again, claiming that these bills will cause hundreds of thousands of people—or, as the member for Moncrieff just said in his contribution to the debate, a million people—to drop out of private health insurance. There is simply no evidence to support these outrageous claims. They are not based on the facts, and we are very confident that we have the mix of incentives and benefits right to ensure that the participation rate remains at high levels. As I say, this hyperbole is designed more to get on the TV news than it is to actually make sure we have a sustainable health system for the future.

Treasury projections are that only 25,000 people are estimated to drop out of hospital cover. These Treasury estimates have been supported by the independent Ipsos private health insurance survey conducted by the industry, not by the government, where the results show that only 15,900 people would drop their hospital cover, based on members’ responses when the package was explained to them. My department estimates that the small reduction in hospital coverage is estimated to result in only 8,000 extra admissions to public hospitals over two years, and this represents an increase of less than 0.1 per cent of the 18 million presentations to public hospitals over the same period. Even the President of the Australian Medical Association, Dr Andrew Pesce, agreed, saying that the AMA’s own modelling showed ‘there isn’t going to be a huge dropout rate at this stage’. That is something that he said on Meet the Press. The peak public hospital body, the Australian Healthcare and Hospitals Association, an organisation that you think would be fearful of any figures being sustained at the levels that the opposition are suggesting might be, have said that there will be ‘little or no impact on the numbers of people with private health insurance’. But, as I have noticed, there is one politician on the opposition side who has spoken honestly about this legislation. The finance spokesperson, Senator Joyce, who holds the job that Mr Dutton would dearly love to hold, has said that the opposition should consider this legislation with an open mind. He said that if there is a net saving you would have to positively consider it.

The opposition now seems to be in total disarray about this issue. The opposition leader’s response to Senator Joyce’s call was to say:

Politicians should be open-minded in a general sense, but it is a very strong position of the Coalition that we don’t support the Government’s proposal …

This sort of general sense compared to reality—that they are just going to oppose anything that gets put before them—is I think going to present some problems for Senator Joyce. But ultimately he has a vote in the other place, and, when the bill comes to the other place, we will be expecting him to act in accordance with good sense and logic.

We are concerned that the opposition leader’s role, it seems, is just to oppose everything that the government does. He is happy and ready with a complaint about everything in the system, which is something that the shadow health minister is very fond of as well. But they have no solutions—not a single solution—to any problem that they persistently complain about. That is what they did when they were in government, but now that we are in government we are determined to take some of the actions that are needed to have a sustainable health system into the future.

So we call upon the opposition not to be obstructive and threaten the sustainability of the budget but to do what Senator Joyce has called for and support this measure. The Minister for Finance and Deregulation and I have written to Senator Joyce offering him further evidence and briefing and further information if he needs it on how this net saving will be achieved for the budget. This measure will make our private health insurance system fairer and more balanced. It is necessary for our health system and for our federal budget. I would like to thank the departmental advisers who have worked on this legislation in great detail. I commend the bill to the House.

Question put:

That this bill be now read a second time