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

There is Senator Cormann, as usual, with a very useful interjection. Senator Cormann, I think that South Australians, in my home state, will be much better off with what the government is proposing than they would be with the status quo. South Australians have accessed only something like two to three per cent of that funding, which is a disproportionately poor outcome for South Australians. I think public dental waiting lists are missing out because the money for the acute care program has not been used as effectively in some cases as it should have been. That is a separate issue but I would urge the government to sort that out as a matter of urgency. I am willing to continue to talk to the government about that because it is long overdue that we have some changes to that.

Under Treasury estimates, the provisions of this bill would mean that means testing the rebate will impact around 2.3 million Australians who currently hold private health insurance, with incomes above $75,000 for singles and $150,000 for couples. The AHIA estimates that these Australians will see their cost of health insurance increase by between 14.3 and 67.7 per cent. Those with private hospital insurance and incomes below the rebate reduction thresholds will be faced with increased premiums as a result of the members who will cancel their private health insurance plans.

This presets a real risk of adding further pressure to an already struggling public health system and I do not believe there has been any specific modelling done on that. One of the questions I will ask the government—should this go into committee—is what modelling has been done on people downgrading their private health cover so they are not caught by the surcharge changes. It has been estimated by Catholic Health Australia that means testing and a tiered approach to the 30 per cent rebate will result in an additional 36,000 people joining public hospital waiting queues.

While I applaud the work of those in the public health sector and praise our public hospitals for the tremendous work that they do on a daily basis, there is no denying that our public health system is struggling. Waiting lists are already considerable at public hospitals around the country. Non-emergency operations are repeatedly cancelled at the last minute or postponed often only to be postponed again and then once again. Put simply, our public health system cannot afford more patients than it already cares for.

It is against this background that I wish to make two more points that will influence my final position on this bill. I said this before during the Nation Building Funds Bill debate last December when I referred to these words of social commentator, Hugh Mackay:

A culture of broken promises in politics increasingly erodes public confidence in our political institutions.

With every broken promise or policy backflip, the level of cynicism grows and grows. By the government’s own admission, this is a broken promise and a policy backflip. In 2007 Australians were promised by the then opposition leader, Mr Rudd, and the then shadow health minister, Ms Roxon, that Labor would not alter the private health insurance rebate if they were to win government. It was an explicit promise. I quote from a letter from the then Leader of the Opposition to the CEO of the Australian Health Insurance Association confirming:

… Federal Labor is committed to retaining the existing private health insurance rebates, including the 30 per cent general rebate …

It was an explicit promise; no ambiguity whatsoever. And yet here we are. Firstly, the introduction of this bill is a broken election promise. But, secondly, to me this bill represents another broken promise, in a sense. It is a promise that is perhaps not as formal as an election promise but it was a promise made in the spirit of good faith in negotiations over the Medicare levy surcharge in October last year. By way of history, that bill also sought to change the funding underpinning private and public health through changing the Medicare thresholds.

When faced with the complex cases for and against these changes, I was struck by the lack of information about how our health system worked, about comparative funding and even basic information on health outcomes, particularly of comparisons between the public and private systems. It was in response to these concerns that I sought a Productivity Commission inquiry as part of securing my support for passage of that bill.

Minister Roxon, to her credit, established this inquiry in May of this year. The Productivity Commission has commenced its examination of comparative hospital and medical costs for similar procedures in public and private hospitals, the rates of fully informed financial consent, relevant performance indicators and the most appropriate form of indexation. Clearly, the changes to funding, indexation and the public/private balance that will result from this bill should be informed by the Productivity Commission’s considerations of such matters. If not breaking the spirit of a promise made through genuine negotiation, then these bills pre-empt important information that should be available so that the Senate might responsibly consider this bill.

One of the mantras of this government has been to use an evidence based approach to decision making. I commend the government for that approach and I am all for that too. I am a strong believer in the principle of keeping governments to their election promises but I am also aware that, on rare occasions, circumstances and context may require a change in policy. The onus is then on the government to provide compelling evidence for the need to change. Only then can senators ascertain whether policy should be opposed, policy should be changed or policy should be returned to the people to decide. I do not believe that a compelling and complete case can be made for this change in position without the results of the Productivity Commission’s inquiry into public and private health.

It is for this reason that, at this second reading stage, I move the amendment that has been circulated in my name:

        At the end of the motion, add “but the Senate:

(a)

notes that the measures in these bills pre-empt the findings of the Productivity Commission inquiry into the relative performance of the public and private hospital systems; and

(b)

resolves that further consideration of the bills be an order of the day for the first sitting day after the final report of the Productivity Commission on that matter is laid on the table.”

I cannot support this bill at the second reading stage unless this amendment is successful and the government commits to await the outcome of the Productivity Commission inquiry. To do anything else would involve recklessly risking the balance between our public and our private health systems.