ALP offers the healthier option

Last week, Kevin Rudd and I announced that a Rudd Labor government would undertake one of the most significant reforms of Australia's health system since Federation.

This announcement promises something that the federal Government has failed to do for the past 11 years: take national leadership in health.

Federal Labor will establish a $2 billion national health reform plan to improve health services. We also announced that if - and only if - state and territory governments had not begun implementing an agreed national plan by mid-2009, a federal Labor government would seek public support to take financial control of Australia's 750 public hospitals. A few days later we followed that up by announcing a $220 million investment in new primary care infrastructure called GP super clinics. These are significant commitments to get our health system back on track and equip it for the demands of the future.

These commitments follow federal Health Minister Tony Abbott's decision last month to defer negotiations with the states on hospital funding. His reasons: "The important task at the present time is to get re-elected and that is where my energies are focused."

Labor is taking leadership and is focused on achieving better health outcomes for all Australians. We will work with the states and territories to reduce unnecessary hospital admissions, non-urgent accident and emergency presentations and waiting times for elective surgery, as well as provide more appropriate non-acute care for older Australians.

One of the ways we aim to do this is by investing in more primary care services in local communities, to keep people in good health and take pressure off public hospitals.

Treasurer Peter Costello's comments about changes to the GST, meanwhile, are a desperate ploy. Federal Labor's health reform plan will not, under any circumstances, require any increase in the GST rate.

The interesting thing is that according to an article published on this page yesterday, only the Howard Government has seriously discussed a GST hike. The Treasurer always wanted the GST to be applied to basic foods, so this shouldn't come as a surprise.

Labor has $2 billion on the table to implement our reforms. Additionally, one of the aims of our reform agenda is to unlock efficiencies and reduce duplication and overlap. Efficiencies generated will be reinvested in enhancing health services for the Australian people.

While we're at it, let's address a few of the other sensational claims flying around.

First, it is important to recognise that Labor would seek to assume financial responsibility for public hospitals only if states have not begun implementing the national health reform plan. Our clear preference is to work co-operatively with the states to achieve the change everyone agrees is needed in our health system. If that occurs, there will be no need for a takeover. Even then, we have said we would seek a mandate from the Australian people before proceeding.

Second, if there are changes in the responsibilities of the commonwealth and state and territory governments in relation to hospitals, it is only common sense that funding arrangements be adjusted accordingly. If failing to implement the plan led to a huge state windfall, that would make no sense at all. That would be a clear case of perverse incentives. Any adjustment in funding would only reflect the value of what health services they would no longer have to provide, so in net terms they would be no worse off.