29 August 1996
JOURNALIST:
Prime Minister, it is all very well to blame a deparnent official for the premium rise, but you knew that rise was coming before the lection.
PRIME MTIiSTER:
I didn't blame themt I was just explaining what had happened. Cani you guarantee that there will be no rise..
PRIME MINISTER:
I have never said, and nobody in their right mind would cver say that there will never ever be increases in health insurance premiums. ftat is plainly ridiculous. What I am saying is that I will pt in place arrangements that will ensure that in future no rise occurs without the cxprcss approval, of the Government and ftht any rise in future is completely justified. Now, the rise that has already occurred is a direct result of the conditions that existe before the change of Government, a direct result of the conditions that existed before the change of Government, and that rise was sanctioned in accordance with a procedure that had existed at least ftbr some yars, perhaps for the whole time, that the former Government was in power. There was no covert conspiracy, there was no political deceit by the Coalition. We promised a health insurance rebate in the election campaign because we believed that if you subsidised the cost of private health insurance through the tax system, then youa arc more likely than not to got more people to go into health insurance. At no stage did we promise that there would never ever be any increases. That's unrealistic and I'm niot promising that now, aind anybody who seeks from me an absolute guarantee that something will never happen in the future, I can't give it What I can give is an absolute guarantee that any change in future will be as a result of a decision taken at a
political level in a way and in circumstanvcs whore we ame satisfied that the rise is completely justified.
JOURNALIST: Is it now highly unlikely that there won't be another increase before the rebate kicks in?
PRIME MINISTER~:
I can't say yes% o r no on that without getting some advice on the situation of the funds.
What I can tell you is absolutely likely. and absolutcly correct, is that any increase
from now on will have to be approved at a political level and it will only be if we are
completely satisfied that that increase is justified. Now thc point I made in my speech
today. and I just made a moment ago, is that the rise that's already occurred was tho
product of circumstances of the last few years and not circumstances of the last seven
mont.
JOURNALIST: Mr Howard if you can't guarantee that rebate are you disappointed at those rises?
PRIME MWJSTER:
Well I guess in my situation you're always disappointed when the price of anything
goes up. I mean that's human nature. Nobody likes the price of anything going up
but it is obviously unrealistic of any politician be that person in Government or in
Opposition to say ' look, I can promise you the price of this will never ever go up in
the future'. I mean. any politician who runs around sayIng that is talking through his
or her neck and should be discounted accordingly. All I can honcstly guarantee to
you and promise you is that we will put in place angeinents that ensure that any
future increases will be as a result of a political decision and only if those in charge of
the decision are completely satisfied, completely satisfied, that the increase is
justified. Now I can only repeat in relation to the increase that's already occurred the
circumstances in which it has occurred. I think it is regrettable that the Minister was
not directly iniformcd, but equally P'm not expressing a view without possession of all
of the facts on the quality of the decision that was taken hy the Department. It may
have been a justified decision, I don't know without having the opportunity of
examining all the facts. But I think in future, particularly where you have a
circumstance that the G3overnment is providing on behalf of the tax payar a subsidy of
half a billion dollars, the political arm of that Government is entitled to have a say in
whether health insurance premiums should go up or not.
JOURNALIST: Prime Minister are you worried you've got a fight On Your hands? I mean the health
industry is profit driven, that's their bottom line. 2
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PRIME MINISTERt
Well they're like a large section of the private sector of the Australian economy.
They are interested in making sustainable profits. that is understandable. Our
responsibility is to see that the rules OTC fair so that the premiums are no higher than
necessary and also that the full value of the tax concession, the tax subsidy, is
dclivered to the consumer of the health insurance product. I don't object to the profit
motive, it's part of the private enterprise system, and I'm not going to pretend that
people donit do things for a profit motive. It's a question of whether the profit is
reasonable and it's a question of whether what they're doing is fair and it's our
responsibility to satisfy ourselves in the future of any, in relation to any increases, that
they are completely j stified.
JOURNALIST:
The Democrats today have threatened not to pass the rebate unless you bring in to, rope in the medical funds. What's your rcaction to that?
PRIME MINISTER:
Well I'd be quite astonished if the l) emocrats voted against giving tax subsidies to
low and middle income careers. I can't, for the life of me. understand how anybody
could think knocking back our proposal will make people better off. I mean, that's
the bottom line will our proposal make people better off? I can't understand the logic
of people who would vote against somethitig that will, in fact, result in a lower net
cost of private health insurance than would be the case if the subsidy weren't given.
I've outlined to you steps that we're going to take to ensure that any future increases
are the subject of proper surveillance and I think that's only fair and reasonable.
JOURNALIST: Do you believe the Senate will pass these rebates, you can't imagine them knocking..,
PRIME MINISTER:
Well I can't guarantee how other people are going to vote. There'll be 37 Liberal and National Party Senators voting to give low and middle income earners a tax break and I'll be looking for two more votes and any Senator who votes against giving low and middle income earners a tax break for their health insurance will have Australians to answer for, over and above anything I might have to say.
JOURNALIST: ( inaudible)... Mal Colston again Prime Minister?
PRItME MINISTER:
Well I haven't had any discussions with him.