Page 2876 - Week 13 - Wednesday, 22 November 1989
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ANSWERS TO QUESTIONS
The following answers to questions were provided:
Hospitals
Ms Follett: On 21 November 1989 Mr Kaine asked:
I would like to direct a question to the Chief Minister and Treasurer. I refer to the Hansard of last Wednesday when we were debating the hospitals and the blow-out of costs. The Chief Minister, in explaining that $2.5m overrun, said that current expenditure is abnormally inflated by workers compensation payments which will be refunded under new arrangements with COMCARE - and the amount we were talking about was $2.2m. Chief Minister, was this $2.2m an amount that was actually budgeted for an expected payment that was then made? Secondly, is it not true that this is not a refundable amount but a prepayment, and under no circumstances would the money ever be refunded? If that supposition is incorrect, when would you expect it to be refunded and under what conditions?
My answer is as follows: on Wednesday, 15 October, I provided some preliminary information to members from the Treasury review team which is currently investigating hospital finances. In the course of my speech I indicated that current expenditure was abnormally inflated by workers compensation payments which will be refunded under the new arrangements with COMCARE. I can confirm that the payments to which I referred are indeed refundable by COMCARE and do not represent an item allowed for in the budget.
I believe Mr Kaine's confusion arises from an incomplete understanding of the arrangements in place since 1 July 1989 between COMCARE and the ACT Department of Community Services and Health. Under these arrangements, hospitals pay an annual premium to COMCARE for workers compensation coverage. The premium has been set at $3.112m in 1989-90. I believe it is this premium to which Mr Kaine is referring. This amount is included in the budget figurings and it is not a refundable amount.
For agencies on the Commonwealth Department of Finance payroll, workers compensation payments are coded to COMCARE and payment is made directly by COMCARE. Since the ACT Government is not on the Department of Finance payroll, direct payment by COMCARE is not possible. Consequently, workers compensation payments continue to be made by the hospital to its employees and these actual payments are subsequently refunded by COMCARE. It is these payments which are abnormally inflating expenditure for the first quarter, as the refund has not yet been received.
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