Judith Adams (WA, Liberal Party) Share this | Link to this | Hansard source

My question is to the Minister representing the Minister for Health, Senator Ludwig. In light of the recent statement about changes to the Medicare surcharge policy, can the minister inform the Senate whether any modelling has been undertaken on the impact on the cost for private health insurance policyholders as a result?

Joe Ludwig (Queensland, Australian Labor Party, Manager of Government Business in the Senate) Share this | Link to this | Hansard source

In terms of the Medicare surcharge threshold, on 10 May 2008 the federal Treasurer, the Hon. Wayne Swan, announced that, as part of the budget, the Commonwealth government will increase the Medicare levy surcharge threshold to $100,000 for individuals and $150,000 for families from 1 July 2008. So that the opposition can fully appreciate what the question is, if you look at the issue of whether or not pressure will be put on public hospitals, it is about giving people choice. When somebody takes out a private health insurance policy just to avoid getting hit with the tax slug, that is not a real choice.

This government has quite clearly kept its promise in respect of the Medicare levy surcharge and it has kept its promise to keep the 30 per cent private health insurance rebate. In the first six months in government, this government announced $1 billion in extra funding for hospitals, beginning to reverse the 11 years of neglect by the Howard government—$600 million to slash elective surgery waiting lists, something that the opposition did not do; and incentives of up to $6,000 to deliver 10,000 nurses into our health and aged-care system, something that the opposition did not do when they were in government. The government also announced the establishment of the National Health and Hospitals Reform Commission, to develop a long-term plan—

Eric Abetz (Tasmania, Liberal Party, Deputy Leader of the Opposition in the Senate) Share this | Link to this | Hansard source

Mr President, I rise on a point of order. Could I, with respect, suggest to Senator Ludwig that he follow your example in relation to answering questions. Specifically my point of order is: the question was very specific as to whether or not any modelling had been done in relation to the impact on the cost for private health insurance policyholders. Our being told about the number of nurses et cetera is very interesting but completely and utterly unresponsive to the question that was actually asked.

Alan Ferguson (President) Share this | Link to this | Hansard source

Senator Abetz, as I have said a number of times today, I cannot direct the minister on how to answer a question. As long as he is being relevant—and, in this case, I do believe he is being relevant—

Opposition Senators:

Opposition senators interjecting—

Eric Abetz (Tasmania, Liberal Party, Deputy Leader of the Opposition in the Senate) Share this | Link to this | Hansard source

On the point of order—

Alan Ferguson (President) Share this | Link to this | Hansard source

Order! Senator Abetz, I believe the minister is still being relevant. We have allowed a lot of latitude in the past when ministers were answering questions. I will listen carefully to what Senator Ludwig says, but at this stage I believe he is still being relevant.

Joe Ludwig (Queensland, Australian Labor Party, Manager of Government Business in the Senate) Share this | Link to this | Hansard source

Thank you, Mr President. In relation to the Medicare levy surcharge threshold, the government strongly believe that a mixed model of private and public health services is essential. We have also invested in primary care to help take pressure off our public hospital system. We know that there are 500,000 preventable hospital admissions each year, including 50,000 admissions for preventable dental conditions. Unlike the opposition when they were in government, we have said that we will invest in GP super clinics in areas that need them, invest $290 million for a Commonwealth dental health program and invest $360 million for a teen dental plan, and name obesity a national health priority area. What the previous government had to say—

Eric Abetz (Tasmania, Liberal Party, Deputy Leader of the Opposition in the Senate) Share this | Link to this | Hansard source

Mr President, I rise on a point of order. We have now had nurses canvassed and we have now had obesity canvassed. Is it allowable for the minister to canvass anything that might happen to appear in the health portfolio when a specific question is asked in relation to modelling on the cost of private health insurance? With great respect, Mr President, I believe he has now strayed well and truly out of the province of the question.

Honourable Senators:

Honourable senators interjecting—

Alan Ferguson (President) Share this | Link to this | Hansard source

Order! It is a rather all-encompassing answer, as was interjected from the government benches. Senator Ludwig, I would remind you of the question relating to modelling and ask you to continue with your answer, unless you have finished.

Joe Ludwig (Queensland, Australian Labor Party, Manager of Government Business in the Senate) Share this | Link to this | Hansard source

In respect of the particular modelling question that was also raised, those costs and savings will of course be in the budget tonight. I am sure the opposition will be keen to be here to look at the budget tonight, to examine those issues in detail and to see for themselves what is there.

Judith Adams (WA, Liberal Party) Share this | Link to this | Hansard source

Mr President, I ask a supplementary question. When before the election did Labor say that they would force private health insurance policyholders to pay more for private cover? Did Mr Garrett know that Labor would sting private health policyholders even more when, before the election, he said, ‘Once we get in, we’ll just change it all’?

Joe Ludwig (Queensland, Australian Labor Party, Manager of Government Business in the Senate) Share this | Link to this | Hansard source

It may be worth going back to what Dr Michael Wooldridge, the then health minister, said in his media release on 20 August 1996:

High income earners will be asked to pay a Medicare Levy surcharge if they do not have private health insurance.

For this initiative, high income earners are defined as single people earning more than $50,000 or couples and families earning more than $100,000.

These are the people who can afford to purchase health insurance, and this measure will relieve some of the pressure on the public hospital system.

That is what the then health minister said in 1996. But he did not leave it there. In 1997 he said in a media release:

High income earners who still haven’t joined a fund need to understand that the extra 1 per cent Medicare tax surcharge will start to be levied on their income from the 1st of July. (Time expired)

Trish Crossin (NT, Australian Labor Party) Share this | Link to this | Hansard source

My question is to the Minister for Superannuation and Corporate Law, Senator Sherry. Could the minister please update the Senate on the approach the government is taking to the formation of today’s budget? Could he also inform the Senate of any alternative views on the need for a fiscally responsible approach?

Nick Sherry (Tasmania, Australian Labor Party, Minister for Superannuation and Corporate Law) Share this | Link to this | Hansard source

I thank Senator Crossin for her particularly timely question, given the budget tonight, and for her ongoing interest in the economic health of our country. Tonight’s budget will be the first for the Rudd Labor government, and it will be based on sound principles of fiscal discipline. During the election campaign and in the period leading up to election of the Labor government, the Prime Minister, Mr Rudd, said time and time again that he was an economic conservative and fiscal discipline—

Opposition Senators:

Opposition senators interjecting—

Nick Sherry (Tasmania, Australian Labor Party, Minister for Superannuation and Corporate Law) Share this | Link to this | Hansard source

Those opposite can laugh. But the proof will be presented to the Australian people tonight. The Prime Minister, Mr Rudd, meant what he said. When the government delivers the budget tonight, through the Treasurer, Mr Swan, it will be delivering on this promise.

But tonight’s budget will not be delivered in an environment without some challenges. We have the legacy left to us by those opposite, the Liberal-National Party, now on the opposition benches. We had government spending that was out of control and we have a cost of living legacy that is hitting hardworking families in this country. We have had a massive under investment in education, health and infrastructure and we have had a complete rejection by those opposite of climate change. We also face a very difficult international financial environment, with the consequence of the US subprime meltdown. None of this is good enough for a modern, efficient Australian economy. These issues cannot be ignored, and we do intend to tackle them in tonight’s budget. Tonight the Rudd Labor government will show the people of Australia and the Liberal-National Party opposite just how it can be done.

Fighting inflation is a central challenge facing our economy today. Headline inflation rose by 1.3 per cent in the March quarter of 2008 to be 4.2 per cent higher throughout the year. That, of course, is well above the Reserve Bank’s medium-term target band of two to three per cent. The higher inflation that was occurring under the previous Liberal-National government is slowly increasing and it has put upward pressure on interest rates. This government inherited the highest inflation in 16 years, and higher inflation has led to higher interest rates. The Labor government recognise the hurt that higher inflation directly causes to hardworking Australian families. We have the right monetary policy framework to deal with inflationary pressures. We have an independent central bank. But this has to be matched by an equally disciplined fiscal policy framework. We cannot rely on increasing budget revenues to deliver a higher budget surplus. The Labor government has indicated that it will be delivering a minimum budget surplus of at least 1.5 per cent of GDP. In January the Prime Minister announced his five-point plan to fight inflation, and we will be delivering on that tonight. It is very important to tackle inflation head-on with a tight budget framework and a significant budget surplus. This will put downward pressure on inflation and result in downward pressure on interest rates.

Of course, the shadow Treasurer, Mr Turnbull—soon to be elected as the Leader of the Opposition—does not believe we have an inflation problem. He recently described it as a fairytale. I have a list of the inflation rates of some 30 OECD countries, which unfortunately shows that Mr Turnbull’s description of inflation as a fairytale— (Time expired)

Gary Humphries (ACT, Liberal Party) Share this | Link to this | Hansard source

My question is to the Minister representing the Minister for Health and Ageing, Senator Ludwig. In a triumph of hope over experience, I would like to ask the minister about modelling. Has the minister undertaken any modelling on the impact on alcohol consumption of the government’s new $2 billion tax on premixed drinks? If so, would the minister share with the Senate what that study revealed? If not, why not?

Joe Ludwig (Queensland, Australian Labor Party, Manager of Government Business in the Senate) Share this | Link to this | Hansard source

It is recognised that alcohol plays a significant role in Australian society. Many Australians drink alcohol and most do so responsibly. Despite this, there is still a major problem that centres on the 35 per cent of people who drink at a level that places them at a significant risk of harm in the short term and the 10 per cent of people who drink at a level that places them at a high risk of harm in the long term. The government supports the measure to reduce alcohol related harm in the Australian community and change Australia’s unhealthy drinking culture. This government is committed to developing a preventive health strategy and has established a preventive health task force. When one hears the questions and interjections from the opposition, one wonders whether they do in fact support the measures that are being taken to reduce the level of alcohol consumption amongst young people.

The government has announced a national strategy to address binge-drinking and has increased the excise on ready-to-drink products. On 10 March 2008 the Minister for Health and Ageing, Nicola Roxon, announced a national strategy worth $53 million to address the binge drinking epidemic among young Australians. The national strategy will begin with three new practical measures to help reduce the misuse of alcohol and binge drinking among young Australians. I would encourage the opposition to support that position. The strategy includes $14.4 million to invest in community-level initiatives to confront the culture of binge drinking, particularly in sporting organisations; $19.1 million to intervene earlier to assist young people and ensure that they assume personal responsibility for their binge drinking; and $20 million to fund advertising that confronts young people with the costs and consequences of binge drinking. A key part of this strategy is to engage sporting organisations from the elite level down to the community level. I would encourage the Liberals to engage in this as well and undertake support and assistance to ensure that the youth of today do not suffer the consequences of binge drinking. A key part of this strategy also includes Nicola Roxon meeting—

Gary Humphries (ACT, Liberal Party) Share this | Link to this | Hansard source

Mr President, on a point of order: I think lecturing the Senate on the evils of alcohol is somewhat redundant. My question was about modelling. What modelling has the government done before deciding to impose this $2 billion tax on Australian drinkers?

Alan Ferguson (President) Share this | Link to this | Hansard source

Senator Ludwig, I would remind you of the question.

Joe Ludwig (Queensland, Australian Labor Party, Manager of Government Business in the Senate) Share this | Link to this | Hansard source

Thank you, Mr President. I am concerned about the impact of binge drinking on Australia’s young people, but I am also concerned about the impact of alcohol on our wider society. On 26 April the government announced that it would restore the excise on ready-to-drink alcoholic beverages to the spirit levels that previously applied. The government’s decision to lift the excise on RTD products will help tackle binge drinking, as research shows that price is an effective measure in reducing alcohol consumption, especially by young people.

When we look at the opposition’s engagement in this, they are not serious about assisting in how you tackle binge drinking in youth and how you ensure that the youth of today will not suffer health problems in later years. What the opposition is concerned about seems to be a mile away from where the young people are at now. The strategy that the Rudd government has announced will provide assistance not only at the community level but also at the advertisement level to ensure that they would— (Time expired)

Gary Humphries (ACT, Liberal Party) Share this | Link to this | Hansard source

Mr President, I ask a supplementary question. I take it from the minister’s answer that there was no study conducted, and I assume therefore that Labor decided before this recent election that it intended to impose this new tax. How does the minister rebut the charge that the Labor Party were cowardly in formulating a decision to have a new $2 billion tax on drinkers to pay for their unfunded election promises but were not prepared to take the electors of Australia into their confidence before the election last year?

Joe Ludwig (Queensland, Australian Labor Party, Manager of Government Business in the Senate) Share this | Link to this | Hansard source

In rebutting the charge that the opposition makes, what they did not do in their 11 long years in government is deal with these significant health issues around ready-to-drink products and around alcohol. The Australian government is committed to a comprehensive strategy to address binge drinking among young Australians. More than $53 million will provide support to the strategy which will be implemented by the Department of Health and Ageing. In rebutting your charge, you have done nothing to assist in this area. You, in fact, ensured that you neglected the youth of today in this area. You, in fact, did not assist. In addition, the National Health and Medical Research Council is currently—

Alan Ferguson (President) Share this | Link to this | Hansard source

Senator Ludwig, I would appreciate it if you address the chair and not senators across the chamber.

Joe Ludwig (Queensland, Australian Labor Party, Manager of Government Business in the Senate) Share this | Link to this | Hansard source

Sorry, Mr President, I will address you. In addition, the National Health and Medical Research Council is currently finalising revised draft Australian alcohol guidelines for low-risk drinking; something that the opposition did not do when they were in government. (Time expired)