Page 1249 - Week 04 - Thursday, 4 May 2006
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$565 million—a jump of $97 million. In 2004-05 the original budget was $561 million. The outcome was $637 million—a jump of $75 million. Mr Corbell is no longer the Minister for Health because he could not live within his means. He could not control his budget. At the same time, with an extra $225 million above expectation, he still could not bring the waiting list down. Over the three years for which details are available, the Stanhope government has exceeded its budget estimates by a total of $225 million. Let me repeat that. In just three years the Stanhope government has spent an aggregate of $225 million more on health than was estimated in its first three budgets.
Now is not the time to debate health policy as such, although these numbers suggest that a robust debate is well in order. I understand that Mr Costello has told the government that, unless savings of around $200 million are made in the outyears in the health portfolio, the ACT budget will potentially be in deficit by $390 million. If the government saves $200 million, it will bring the deficit down to $190 million.
I am told that Mr Costello said that, in terms of GFS, the deficit would be $360 million, possibly elevating to $560 million. On page 44 of the government’s own 2004-05 Mid Year Review, which clearly the Chief Minister has not read, GFS net operating balance for 2008-09 is shown as $332 million. The figures being quoted are not far off the mark. These numbers reveal the magnitude of the task facing the Stanhope government. But what does it mean for the ACT community? In three years the government has spent $225 million more on health than was budgeted for. This represents an average overspend of $75 million on health each year—an overspend of around 12 per cent in the health budget. This is a serious issue when we consider that the average CPI increase in health is six or seven per cent.
The Stanhope government has overspent its health budget by an average of 12 per cent, or $75 million, each year to date. The Stanhope government has now received advice that it has to make substantial savings in the health budget of perhaps as much as $200 million. At $75 million times four, it is easy to see where the number comes from. The Stanhope government has to make some dramatic savings to the health budget if it is to even start bringing the ACT budget back into surplus.
Anyone with a sense of history will recall that in each of my three replies to the budget, I have placed on the table warnings about the Chief Minister’s ineptitude and lack of control of the ACT budget. The sad reality of the ACT budget is that what I have said over the last three years is now confirmed. What has been the response of the Chief Minister, the Treasurer, to the position of the ACT budget? First and foremost, he decided to stare down the budget deficit. Secondly, he instituted a review of the ACT bureaucracy and budget. It is a case of being seen to be doing something—anything at all. As an outcome of that review, he has decided to repeat the folly of Rosemary Follett and propose the centralisation of some shared services.
At a time when the Australian economy is performing soundly, the ACT budget is in deficit. The ACT economy itself remains extremely buoyant. No other jurisdiction is budgeting for a deficit this financial year. The only conclusion is that the economic managers of the ACT economy, the Stanhope government, have no idea of the principles by which an economy should be managed.
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