Page 2587 - Week 12 - Wednesday, 15 November 1989
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The Government cannot continue to allow hospitals to be a large and uncontrollable drain on the Territory's resources. It is because of that responsible financial approach that the Government has sought continual monitoring of the health budget, and it is our vigilance in that matter that has brought about the current focus on budgetary issues.
Unfortunately, publicity has been given recently to figures which do not represent a true picture of the situation. Our information does not support the recently publicised figures suggesting a $10m so-called blow-out in the hospitals' budget for the 1989-90 financial year.
I repeat that it is very important that we keep this matter in perspective. To call the current situation a crisis is humbug. Such talk alarms the staff, the unions, the patients and the wider community, and I reject such an approach to a very serious part of our social fabric here in Canberra.
In the normal course of responsible financial management, we are fully investigating the reported overrun, how that overrun has been calculated, and its causes. Members will know, and many of them have mentioned it, that a review team from the Treasury is currently investigating these matters. This investigation is still under way. However, at this stage, I can give some preliminary indications of the findings of that review team.
The $10m figure was derived by a straight line projection of a reported overrun of $2.5m to the end of September. However, both these figures are based on a number of assumptions which do not represent a true picture of the budget outlook. I think it would be useful to point out some of the factors which must be taken into account in providing a more accurate picture of the potential budget outcome for the year.
In-patient activity levels in our hospitals are measured in terms of occupied bed days. In the first quarter - that is, to the end of September - activity levels rose by 4.5 per cent over figures for the previous quarter and for the comparable period in the previous financial year. We are looking at the reasons for this abnormally high level of activity. It largely occurred at Woden Valley Hospital and appears to have dropped off again in October. Indications are that it will not be sustained. Because of ACT staffing policies, this increased activity flows directly and quickly into higher levels of expenditure on salaries. There is also a flow-on effect to the other costs involved in providing hospital services.
At this stage, analysis of the impact of this abnormally high activity on the year's expenditure pattern has not been completed. Other fluctuations in activity levels will affect the total picture for the year. The traditional
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