Monday, 27 February 2012
Fairer Private Health Insurance Legislation
I seek leave to move a motion in the terms circulated in the chamber relating to the Fairer Private Health Insurance Incentives package of bills.
Leave not granted.
Pursuant to contingent notice of motion, and at the request of the Leader of the Opposition in the Senate, Senator Abetz, I move:
That so much of the standing orders be suspended as would prevent Senator Abetz moving a motion to provide for the consideration of a matter, namely a motion to give precedence to a motion relating to the consideration of the Fairer Private Health Insurance Incentives Bill 2012 and related bills.
I move this suspension because this is yet another betrayal of the Australian people by the Australian Labor Party. It is another betrayal from the most serial of betrayers, the Prime Minister herself. This is the Prime Minister who betrayed the Australian people with the carbon tax, and she is at it again with private health insurance. Julia Gillard and other Labor members have, over many years, repeatedly ruled out any changes to the private health insurance rebates. They have been totally and utterly false about their positions.
I take the Senate back, if I may, to the then shadow minister for health, Julia Gillard, on 2 September 2004:
I grow tired of saying this: Labor is committed to the 30 per cent private health insurance rebate.
In the Courier Mail, on 23 September 2004, she reiterated her commitment. She did it again in October 2005, saying:
The truth is I never had a secret plan to scrap the private health insurance rebate and, contrary to Mr Latham's diaries, do not support such a claim. For all Australians who want 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.
But wait for the punchline:
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.
What a joke! The hypocrisy of the woman! Then we had Nicola Roxon on Meet the Press, on 23 September 2007, saying, 'We are committed to the 30 per cent.' Then, when she was asked by Steve Lewis, 'So you won't wind back the 30 per cent private health rebate, despite the fact that Labor has been ideologically opposed to it in the past?' Nicola Roxon replied, 'No, we won't.' On 26 September 2007, the former Minister for Health and Ageing, Nicola Roxon, said:
The Liberals continue to try to scare people into thinking Labor will take away the rebates. This is absolutely untrue.
Then we have the letter of 20 November 2007 from then Prime Minister Rudd to the Australian Health Insurance Association, reiterating this commitment in writing, but the letter was not even worth the paper it was written on. After that federal election, former Prime Minister Rudd said that the private health insurance rebate policy 'remains unchanged and will remain unchanged'. We kept getting these promises that Labor would retain the rebate.
In a speech in October 2008, Nicola Roxon was again making this commitment, yet during Senate estimates it was revealed that, while Minister Roxon was giving that public assurance behind closed doors, she and other senior members of the government were seeking advice on how to progress changes to those private health insurance rebates. They were firmly committed to retaining the existing rebates in public, while secretly working on plans to reduce and scrap them. We know that Minister Roxon first obtained advice from her department on 12 January 2009, and the advice on how to change the rebate was being sought by the health minister's office as early as December 2008. Treasury provided advice on means testing the rebate on 20 February 2009 at the request of the Treasurer.
This is the hallmark of the Rudd and Gillard governments. They say one thing and they do another. We know that these cuts will affect and further add to Labor's cost-of-living burden on working Australians. After years of waste and mismanagement, Labor is hiking up prices for working Australians. We know that Labor's premium hikes will force people to drop private health insurance and will downgrade their cover, and this will further stretch the overstretched public hospital system. Labor is wrong to imply that private health insurance is only for the rich—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. Given this government's history, we are very concerned that, unless these bills are discharged from the Notice Paper, the Australian public will be hit again. Consequently, I seek support for a suspension to enable this discharge motion. (Time expired)
The government's decision to abolish the private health insurance rebate for millions of Australians is just another example of the bad and ideologically driven policy we get from this very incompetent and deeply divided Labor government. This broken promise on the private health insurance rebate is bad policy, it is bad for our health system and it is bad for patients right across Australia. Before the 2007 election the coalition was somewhat suspicious about the Labor Party's intentions in relation to private health insurance. So we made the assertion that Labor in government would do what they have done before—that is, undermine those Australians who take additional responsibility for their own healthcare needs by taking out private health insurance, who are putting additional money into the health system and who received a tax incentive from the Howard government to encourage them to put more of their own resources into the health system. Of course, whenever we made the assertion that Labor would do as they have always done—that is, make people who take additional responsibility for their own healthcare needs pay the price for the government's reckless and wasteful spending in other areas—Labor put their hands on their hearts and said: 'We wouldn't do that. We're not going to touch the private health insurance rebate. We're committed to the private health insurance rebate.' This government, which is completely untrustworthy—this Labor administration which made promise after promise before the election only to break them after the election—is now trying to put through the Senate a piece of legislation which has previously been rejected by the Senate.
As Senator Fierravanti-Wells has just reminded me, the Senate very sensibly rejected this bad legislation on two occasions. And why did the Senate reject Labor's attempts to make people who take additional responsibility for their own healthcare needs pay for Labor's own reckless and wasteful spending in other areas? Because the Senate knew that this piece of legislation will push up the cost of private health insurance, put it beyond the reach of a number of Australians and see more people leave private health insurance, which will push up the cost of health insurance for everyone, including low- and middle-income earners who are currently making significant sacrifices in order to be able to afford their private health insurance every year—the people who are most likely to leave private health insurance after the cost increases by 42 per cent immediately.
Courtesy of this decision, many Australians will have to pay 42 per cent more for their private health insurance just like that, without even taking any of the flow-on consequences into account. As those Australians who are least likely to need private health insurance in the foreseeable future leave private health insurance, the cost for all of the remaining Australians, including those who are most likely to need private health insurance in the foreseeable future, will go up. This will take us back to the vicious cycle where past Labor administrations have taken us before, where we see the cost of private health insurance go up and people leave, and then the cost goes up more and more people leave. Of course, we end up with a downward spiral of additional pressure on our public hospital system, with more people having to join public hospital queues, when quite frankly what the government should be doing is providing well-targeted incentives to encourage more people to take out private health insurance and put additional resources into the health system.
All of the evidence that has been presented over the last 10 or so years since this very sensible and very successful Howard government policy was put in place has demonstrated that this has been part of a highly successful package of policy initiatives. It was of course the Howard government that reversed the decline in private health insurance when it came into government in 1996. The private health insurance rebate, lifetime health cover and the Medicare levy surcharge were a successful package of initiatives that helped restore the balance in our health system. We need both a strong public system and a strong private system so that all Australians can have timely and affordable access to high quality health care.
It is groundhog day again for those opposite. We have heard this debate twice over now. They get up on procedural matters and suck up oxygen which could be used for the merit of the debate when we have the second reading debate and the committee stages of the bill. Rather than wait for that, they use a cheap political stunt such as a procedural motion to argue the point again. What we did not hear from those opposite is the actual argument for why Senator Fierravanti-Wells's motion should get up—not the merit of the actual debate. Senator Fierravanti-Wells and Senator Cormann can have their say, for 20 minutes a pop, during the second reading debate to argue their case and convince those here in this chamber. But we did not hear one jot about why we should up-end the Senate and pay attention to the false and pitiful motion that Senator Fierravanti-Wells has put up, which would ultimately stop the bill from proceeding. Forget about the fancy words that are put in front of it; it would stop the bill from proceeding. And what would we be doing? We would be denying reform by a Labor government committed to improving the lives of working people and creating greater fairness for them and their families. This legislation is a win-win for working families, and those opposite do not want to participate in it. I understand that. They have a different view. They have a very different view on this legislation. But this is not the time for that debate. They will all have an opportunity to debate that in due course.
We are now having a debate on this motion, put up by Senator Fierravanti-Wells, that is simply a procedure device. They have used it before; they will do it again. As I said, they have not learnt from the last time. All you are doing is using procedural devices to try to change the course, to say that your particular motion should have precedence. This would effectively mean that your motion would take precedence in the Senate. There is no argument for that. There is no argument as to why your motion should take precedence. No specific issues were raised other than the same arguments that were raised in the lower house about the merits of the bill. It is quite appropriate. You can have your say when the second reading debate comes on. That is the place to say it, not here. If we start to add them up, it becomes very clear to me that you are simply into delay and Senate time-wasting opportunities.
In recent years, it seems those opposite have been unable to contain themselves. They find procedural devices to give the debate some more currency—wake up to yourself. Use the force of the second reading debate to make your point in committee rather than try to use cheap political stunts such as this to rerun your argument. Alternatively, subscribe to the groundhog theory that you simply want to rerun the argument time and time again without recognising that what you are doing has little merit. In my view, it has no merit at all.
Five bills have been introduced. This is the point where we introduce the bills for debate. It is usually non-controversial. We bring these bills in, we put them on the Notice Paper and they are there for debate. Unfortunately those opposite seem unable to resist the temptation to use the time of the chamber for procedural shenanigans on the introduction of the Fairer Private Health Insurance Incentives Bill 2012 and related bills. Let us be clear: this debate is using up the time of the Senate for a cheap, political stunt on a procedural motion that cheapens the opposition's ability to argue during this second stage. Quite disappointingly, those opposite seem only prepared to rerun the arguments without— (Time expired)
Welcome back, Senator Ludwig, for what may be a cameo appearance as Manager of Government Business. We all wish Senator Arbib well. It is nice to see Senator Ludwig again.
Senator Ludwig said that coalition members in this place are running the same arguments that had been run by the coalition in the other place. He is quite right. We are. They were valid there, they were valid then and they are valid now. The purpose of this procedural motion is to seek the opportunity to have the order of the day for this legislation discharged from the Notice Paper. Why do we seek to have this matter discharged from the Notice Paper? It is so that this legislation is not further considered and does not proceed through this chamber. That is the purpose. We have been denied leave to move the motion so we are now debating that standing orders be suspended to enable this particular debate. I hope that the chamber agrees for that to happen.
This is yet another clear-cut case of a government breaking its word. We all know of the now infamous commitment by the Prime Minister that there would be no carbon tax under a government she leads. She lied; she fibbed; she broke her word. This case is as clear-cut as that. Election after election this party went to the Australian people—
Madam Acting Deputy President, I rise on a point of order. I normally do not interrupt the flow of a speaker in full flight. In this instance, the point of order is that he may have inadvertently slipped into language that is inappropriate and unparliamentary in this place. I am sure he did not do that on purpose. I know, Madam Acting Deputy President, you were changing place with Acting Deputy President Back at that moment, but I ask Senator Fifield to reflect on that and to withdraw.
I think the word 'fib' is well within the bounds of discourse in this place but thank you, Madam Acting Deputy President. I was saying that this is as clear-cut a case of breaking one's word, of fibbing, as was the broken carbon tax promise. At successful elections members of the Australian Labor Party—candidates, members and senators—put their hands on their hearts and said, 'We will not touch the private health insurance rebate.' I recall the member for Griffith saying, 'Not one jot; not one tittle.' I am not sure what that was but I took it to mean he was not going to change it in any way, shape or form. That is the commitment they made. They said: 'Trust us, we love private schools—no schools hit list.' They said, 'Trust us, we love private health insurance. We're not going to touch the private health insurance rebate, in any way—not even a means test.'
Minister Roxon made that commitment. Minister Rudd made that commitment. Prime Minister Gillard made that commitment. Each and every one of the them said: 'No way. Trust us. We've changed. We're not the party of envy any more. We don't believe in the politics of envy any more. We've changed.'
You know what? A lot of Australians at successive elections took them at their word. I know because I had members of the public come to me and say, 'Look, Labor don't want to attack private schools. Labor don't want to attack private health insurance. I have heard Labor senators and members say that.' That is what they say to me. I would explain, calmly and patiently, 'Don't believe them; they haven't changed.' It is clear that nothing has changed about the Australian Labor Party. Its traditions and its roots in class envy and envy politics go deep.
This is bad legislation. We want to encourage Australians to make provisions for themselves. We believe in both the carrot and the stick. We believe that if you do not take out private health insurance and you have the capacity to, above a certain income level there should be a penalty. We believe there should be that stick. But we also believe that there should be a carrot—encouragement and reward for making provision for yourself. This legislation seeks to attack that very idea of making provision for yourself when you have the capacity to do so.
It is the politics of envy. It should be condemned. We do condemn it. We are moving this motion to suspend standing orders because we believe we should be able to move a motion seeking the discharge of this legislation from the Notice Paper. The legislation should not have got this far. Members in the other place should have stopped this legislation in its tracks. They failed to do so. We have an obligation to hold this government to its word—to hold the Australian Labor Party to its word. It is time they were called on it. We want to call them on it.
The Senate should support this motion to suspend standing orders so that Senator Fierravanti-Wells can move her motion to seek to have this matter discharged from the Notice Paper.
I indicate that I will not be supporting this motion. I think it is important that I outline the reasons for doing so, so that it is not misinterpreted as in any way supporting the government's position, in a substantive sense, with respect to the legislation that is being put up.
Firstly, I do not think it is appropriate to use this vehicle of the suspension of standing orders in relation to a motion with respect to legislation that will be coming to the Senate shortly. The fact is the legislation has passed the House of Representatives. The fact is we will have ample opportunity to debate this. Provided there is not a gag motion applied there will be a fulsome debate on this piece of legislation. So my issue with Senator Fierravanti-Wells is not with the substance of what she is trying to achieve—that is, to highlight the inadequacies of this legislation—but I do not think it is appropriate for there to be a suspension of standing orders so that the bills are not debated at all.
I do have concerns about the government's bills. I will be opposing the government's bills for the same reason that I opposed them previously. I think that this legislation will have a number of unintended consequences. Those consequences will be that people will drop out of private health insurance. It will mean that more and more people will go to the public system. It will place an undue and unnecessary burden on the public system.
We need to bear in mind what the impact of that will be. It could mean a spiralling of increased premiums in the private health insurance system. It could mean a greater burden on the public purse in terms of the public system. I think it is worth reflecting on the work of the Productivity Commission. Some three years ago I negotiated with the government, in return for my support for changes to the Medicare surcharge thresholds, that a report be undertaken by the Productivity Commission into the different outcomes between the public and private systems. Something like that was never done before. I thought it was a very fair report. It was a robust report, as is generally the case from the Productivity Commission. That report, I think, is worth reflecting on in the context of the legislation that this motion refers to. I am worried that we will disturb the equilibrium between the public and private systems as a result of the government legislation that has already gone through the lower house.
I am worried that the government has not adequately modelled a whole range of issues in terms of the impact of this legislation, including the issue of people dropping out or downgrading their cover because, if that is the case, expect to see—with respect to physiotherapy, some help with dental work, occupational therapy and a whole range of ancillary covers—a massive shift to the public system. In order to avoid any levies and in order to avoid any penalties people will simply downgrade their cover to the absolute minimum. That, to me, will have all sorts of dire consequences to the private health system, with a significant flow-on effect to the public health system.
These are matters that I think ought to be ventilated at the second reading stage. So I agree with Minister Ludwig in relation to this. That stage is the appropriate time to debate them. I certainly hope there will not be a gagging of debate either at the second reading or committee stages.
I do not quite understand that this motion to suspend standing orders is appropriate. I think we should subject this legislation to the robust scrutiny it deserves. I will be voting against the legislation but I am looking forward to the committee stages. For those reasons—those technical reasons, if you like—I cannot support what Senator Fierravanti-Wells is proposing. But I do share her deep concerns about the impact of this legislation.
There is nothing wrong with stunts, Senator Xenophon. I think you got the prize today! But this is another stunt. If the motion were carried—let us be very clear about what this means—we would not allow the Senate to do what it is noted for, and that is to scrutinise legislation.
The upshot of this being carried would be that we would not debate a series of bills that have been passed by the House of Representatives. We would not be able to do what the Senate is noted for—scrutinise, amend, negotiate, and work with the crossbenchers to get a better outcome for the Australian community. I believe that the bills represent very good policy—great policy—but there are people in this place who have a different opinion. And Senator Xenophon has said as much in his contribution. This is a procedural motion—a procedural motion that would mean, if it were carried, that we would not debate significant changes to the private health insurance levies system in our country. Let us go to why the Liberal Party does not want to have a fulsome debate about this particular set of bills. We know that this legislation will save taxpayers $2.4 billion over the next three years or $100 billion over the next 40 years. We also know that the opposition leader had said that, if he were to become prime minister, the proposal that Labor is putting forward would be repealed. That is another $2.4 billion that he has to find in the forward estimates. It is another $100 billion over the next 40 years if these changes to the private health insurance rebate are not carried.
If we carry this motion we will not have the opportunity to refute the absolutely incorrect assertions that private health insurance membership will decrease. We know Treasury modelling estimates that, after these changes come into effect, 99.7 per cent of people will remain in private health insurance as a result of incentives such as the Lifetime Health Cover and the Medicare Levy Surcharge. Any time there is a change to the way the premium subsidy works, we get railed by that side about how everyone is going to leave their private health insurance and that the public hospital system will be inundated. Can I say that that has never happened. That has not happened any time there have been changes to the private health insurance modelling even under previous governments.
The facts are that 90 per cent of lower income adults should not subsidise the private health insurance of the top 10 per cent of contributors. It is not fair, in our view, that a bank teller who is earning $50,000 should be subsidising the private health insurance of a banker who is taking home $260,000. That is not fair. I think if you go out there and talk to those wealthier Australians, they are probably a bit embarrassed that the people they are employing in their businesses are subsidising their private health insurance. It will not result, in my view or Treasury's view, in an exodus from private health insurance coverage. In fact, eight million Australians will not even be impacted; 2.4 million people will be; 930,000 of those will have their rebate reduced by 10 percentage points; and 780,000 will have their rebate reduced by 20 percentage points. We are talking about 700,000 of the wealthiest Australians who will no longer receive the rebate; 700,000 of the wealthiest Australians who currently have their rebate subsidised in many cases by the people they employ. This is a stunt of the first order and should be opposed.
Before I start talking I notice that the acting Manager of Government Business spoke about the fact that we were not addressing the motion but rather the substance of other issues and then moved straight away to talk about the substance of other issues. I feel as if I have a licence to do so.
Clearly, what we have seen today is another broken promise from this Labor government. When Senator McLucas says the outcome of this motion getting up would be to remove these bills from the Notice Paper, she is absolutely right. That is exactly what we want to do. We want to remove this because we want to keep you to the promise you have made over successive elections. We want you to keep your word to the Australian people, as you did before the last election and the election before that, about what you were going to do. It reminds me of what you have done in relation to the carbon tax, another broken promise. You go into election campaigns, say one thing and then do another.
Do you know how many people supported you on the back of your firm, non-negotiable commitment to keep the private health insurance rebate? Tens of thousands of Australians were warned you would do this, but they said, 'No, surely not.' As Senator Fifield said: 'They believed you. We warned them of what you were going to do.' You sit here and laugh as if it is funny that you can break an election commitment and it is worth giggling about, Senator McLucas. If you find those sorts of things funny, then I think that is a gross indictment on the party that you represent. You broke this promise. You went to two elections saying you would not do it and you have broken it. You went to the last election with a promise on the carbon tax and you broke that. (Time expired)