Page 3282 - Week 12 - Thursday, 19 November 1992
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MRS CARNELL (3.26): The matter of public importance we are debating today is the importance of the Medicare agreement to the health of the people of Canberra. I have assumed that, as Mr Berry has already agreed to sign the new Medicare agreement, Ms Ellis is referring to the new Medicare agreement. I could not be more happy to debate this topic today. It is quite clear that the proposed agreement compromises the health and finances of the people of Canberra. The development underpinning the new agreement is the rise in the Medicare levy from 1.25 per cent to 1.4 per cent. Let me first state that the Federal coalition opposes this rise in the levy. It will hurt people on low incomes and it will hurt retirees. The Liberal Party, and most people within the health sector, think we should get additional funding for health not from imposing taxes but by more adroit management of health financing. In particular, by encouraging private health funds we could get substantially more money into the public health system.
The Medicare levy is a propaganda tool. It is simply a tax, and the Liberal Party believes that there is no coherent reason, apart from the Labor Government's propaganda purposes, for keeping this tax separate from the rest of the taxation system. The Liberal Party would dispense with a separate levy and would raise funds for Medicare through the normal taxation system. Why is the Medicare levy a propaganda tool? Because it leaves people with the impression that health provision is very cheap and that all they have to do to get good health care is to contribute what was 1.25 per cent and is now 1.4 per cent of their income. In fact, the Medicare levy pays for barely 12.5 per cent of total government outlays on health.
Mr De Domenico: How much does it pay for?
MRS CARNELL: Only 12.5 per cent. If the Medicare levy were to pay for the Australian health system in its entirety, we would have to raise the levy not just from 1.25 per cent to 1.4 per cent, as announced in the budget, but from 1.25 per cent to 6 to 8 per cent of every person's income. In fact, most of the money for our health system comes from normal State and Federal government taxation, and a substantial amount from private health insurance. A separate Medicare levy is a propaganda tool because its sole purpose is to suggest to the Australian public the very false idea that public health provision is cheap. I totally support Medicare, as does the coalition in Fightback. But I do not support measures that are designed to stifle debate and to deceive the public about the real costs of Medicare. However, this is an aside.
As I said, the principal development underlying the new Medicare agreement is a rise in the levy from 1.25 per cent to 1.4 per cent. Nationally, this increase in the levy will make extra funds available. The extra funding will be distributed to the States through the so-called bonus pool and through incentive packages. However, so far as the ACT is concerned, the prospect of any additional funding is superficial. You have to look behind the facade of the Medicare agreement if you are to know how the ACT will fare. You will soon see, when you do this, that the ACT will fare very badly indeed.
Mr De Domenico: How much more will it cost us?
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