Mathias Cormann (WA, Liberal Party, Minister for Finance) Share this | Hansard source

Let me just answer that final comment first. Yes, the government did make a commitment in the lead-up to the last election that there would not be any cuts to health in the period of the budget forward estimates from the time of the last election, and indeed there will not be. What we are doing is reprioritising some of the expenditure inside the Health portfolio. Something that Labor never understood in government and clearly still do not understand in opposition is that there is no magic pudding. If you want to spend more money on a higher priority, you have to spend less money on a comparatively lower priority in the circumstances. That is exactly what we are doing in this circumstance, so in the same way that the Health and Hospitals Fund initiated by the previous government replaced an initiative of the previous government before that—the Howard government—we have made judgements in all of the circumstances about what the best and most appropriate priorities in the Health portfolio should be moving forward. That is why we have decided that, as part of boosting investment in medical research, we would transfer about $1 billion in uncommitted funds from the Health and Hospitals Fund to the Medical Research Future Fund. The Health and Hospitals Fund moneys are uncommitted, so they are not currently being used for health purposes. The Health and Hospitals Fund was always intended to be a time-limited fund—that is, it was always intended by the previous government to be a time-limited fund—which would eventually be exhausted, unlike the Medical Research Future Fund, which will exist in perpetuity and will deliver health benefits to the Australian community in perpetuity. The Medical Research Future Fund allows the balance of these funds to be used for health purposes that are both wider and more strategic than the Health and Hospitals Fund allowed. This redirection will be more beneficial to long-term improvements in public health than leaving the funding in the very narrowly focused and dormant Health and Hospitals Fund. The early injection of these funds is very important to ensuring that the Medical Research Future Fund is scaled up quickly and makes the strongest contribution possible to medical research and innovation as early as possible. With this money, Australia will be well advanced towards building what should prove to be the largest sovereign medical research fund in the world, but without this seed capital the timing and scale of that ambition would be set back. For those reasons, the government does not support these amendments.