Putting a healthy surplus before personal well-being

Again: the Federal Government must account for distributive outcomes as a consequence of any policy. We do not need disadvantaged Australians to be deterred from seeking medical assistance when they are in need. And neither should we be imposing a surcharge whose structure and impact is similar to a regressive flat tax.

Finally there is the prospect of the privatisation of Medibank Private.

Certainly the Ideology of privatisation has never been more entrenched. And to be honest this is as much Labor's responsibility as it is that of the Conservatives. But without getting in a general debate about privatisation, there are two very likely or certain consequences of any Medibank Private privatisation that deserve attention.

Firstly Medibank Private is paying the government almost half a billion in the financial year up to October 2013. Though Fairfax has its net profit rate after tax at $233 million. This was following a shift on the part of Medibank Private from a 'not for profit' footing to a 'for profit footing' under the Prime Ministership of Kevin Rudd in 2009. Arguably this policy had the effect of undermining the mission of Medibank Private to provide very strong competition in the sector in order to drive the cost of private health insurance for consumers down.

But regardless of Rudd Labor's decision, to forsake Medibank Private's substantial dividends at a time when the government is arguing there is a 'budget emergency' does not make sense. Privatisation, here, will likely cost the Budget bottom line and lead to further austerity against the vulnerable later on.

Yet because of the central historic mission of Medibank Private in injecting a vital dose of competition into a sector which otherwise could be marked by greater collusion in the context of an oligopoly, there is a convincing case to restore Medibank Private to a 'not for profit' footing. Any foregone tax revenue should be made up elsewhere (the alternative is likely a poorer deal for consumers). Privatisation of Medibank Private would undoubtedly cost consumers over the long run 'on two fronts' – not only forsaking dividends, but 'shutting the door' on a return of the enterprise to a 'not for profit' footing.

And what is also notable is that currently a good portion of the Private Health Insurance Rebate is recouped when increasing numbers of health consumers choose Medibank Private for their health insurance policy.

This leaves the Federal Government with little more than an ideological agenda: an outlook which Abbott had disavowed in his book 'Battlelines' – where he claimed to be a 'practical' conservative."

Well: if Abbott meant it when he made those arguments then it is time to put rhetoric into practice.

And for Bill Shorten and Labor: stating that any Medibank Private privatisation will be reversed by an incoming Labor government could also provide a welcome and popular deterrent.

To conclude: others on the Left may be surprised or dismayed that I am arguing for reform of the Private Health Insurance Rebate which do not amount to its outright abolition. In principle certainly I am in favour of a massive injection of funds into socialised health care. I am in favour of a radical expansion and progressive restructuring of the Medicare Levy - with billions injected into dental, mental health, the Pharmaceutical Benefits Scheme - and all areas of need.

I am also genuinely afraid that the mooted $6 surcharge could be 'the thin end of the wedge' for a gradual erosion of public health, and the further entrenchment of a 'two tier health system'. Here arguments about the 'ageing population' need to be met head-on with counter-arguments pertaining to distributive justice: and with reference to the priorities of our welfare state and social wage. Certainly we have one of the most tightly targeted welfare states in the world; and further progressive reform of tax, elimination of 'corporate welfare', and appropriate targeting of some programs (eg: the Private Health Insurance Rebate again) – could save many billions. As Richard Denniss of the Australia Institute also infers constantly: 'welfare for the rich' in the form of superannuation concessions should be abolished – potentially saving tens of billions. This can be extrapolated from his claim that over $10 billion could be saved from removing the concessions from the top 5 per cent income demographic alone. So removing those concessions from the top 15 per cent, say, could go a very long way to neutralising the 'ageing population crisis', with the associated health costs. Do we really need 'welfare for the rich' in the form of superannuation concessions for millionaires? And what rationale is there when such a policy does nothing to further reduce the overall costs to the Budget when both Concessions and Pensions are taken into account ?

Progressive reforms in public health are more likely to occur under a Labor government. But so long as we endure under a Conservative government Labor and the Greens need to be open to compromises which could be of benefit to their core supporters amongst the poor, the vulnerable and the disadvantaged. Apparently no decision has been made yet on the matter of the policies suggested by Terry Barnes. But should some kind of 'surcharge' be implemented the compromises I am suggesting here could matter a great deal for disadvantaged Australians in the meantime.

That is until the next Federal election – when it is to be hoped a renewed Labor government will make the most of a progressive mandate on distributive justice – radically and progressively expanding public health.