HOST: Prime Minister, good morning.
PM: Thanks for having me on the program.
HOST: That was a fairly large concession, wasn't it, to allow the states to control their own pool funding? You always said the buck would stop with you. Why did you buckle to the Premiers on that?
PM: Well let's be very clear about it. First of all, we said we'd bring about a new National Health and Hospitals Network which is funded nationally, and run locally. We've delivered on the system being funded nationally, that is, for the first time the Australian Government will be the dominant funder for the system. Secondly, we've also said that local hospital networks, rather than state health bureaucrats, should deliver the system, and that those local hospital networks should have a core and greater role for local clinicians, doctors and nurses, to have their say.
On your point about the actual delivery model or the delivery agency of funding on the ground to local hospital networks, what we've agreed to with the states and territories is not a state delivery agency, what we've agreed to is a joint State-Commonwealth statutory body which becomes the payment authority. In fact, it's better than what we've planned before. Our money goes through this payment authority to the local hospital networks, and the states' money does as well. There'll be full transparency, therefore, about how the money is being delivered to each of the local hospital networks of Australia. It's actually better than what we planned for.
HOST: But those networks remain managed by the states. Under your original plan- well, it wasn't clear, was it- the original plan, they were going to be managed by the Commonwealth, weren't they?
PM: No, that's not correct. What we put forward was- in our blueprint that we released at the National Press Club about six weeks ago- was a system funded nationally, run locally, but local hospital networks, as we stated then, would negotiate their service contracts with the state health departments. What we would do is pick up the funding that was necessary to deliver those programs on the ground. There's no change there.
On the question of the actual funding authority, it's better than what we had before, because the funding authority now brings together both the Australian Government's funding and the States' Government funding through a conjointly controlled mechanism, and pays that through to the local hospital networks. That is better, because it actually produces greater transparency, on all the money reaching frontline services, as opposed to being siphoned off in the state health departments.
HOST: Okay Prime Minister, let's talk about WA, Colin Barnett refusing to sign up for the plan. Does that put the deal in doubt, or can you cut him out? Or does it scuttle the deal? Or will you need two deals? What will happen if he sticks to his guns?
PM: The bottom line is, the agreement we reached yesterday to deliver 1300 new hospital beds, to deliver some 6000 new doctors in terms of medical training places, as well as some 2500 new aged care places. This has been delivered and agreed with Governments representing 90% of Australia. Now, as far as Western Australia is concerned, look, this has happened before. We've already got a couple of intergovernmental agreements from which the Western Australians have decided not to become engaged. That's, I think, important for people to understand.
The delivery for the rest of the country flows as per the agreement yesterday. I'm confident we'll work our way through with the Premier of Western Australia. I've got to know him quite well over the years, the last year or so that he's been in the job. And we must make sure that these extra hospital beds, extra doctors, extra aged care places are delivered on the ground for the long-suffering people of Western Australia as well.
HOST: But if not, the deal with the other states will stand?
PM: The deal with the rest of the states proceeds anyway. That's just the bottom line here. Let me be absolutely clear about that. There will be a fundamental change to the way in which health and hospital services across the country are funded and delivered through this reform plan, which is the biggest change to the health and hospital system since the introduction of Medicare.
As for WA, we can find our way through. I'm sure we'll be able to sort something out. But I think it's really important for people, including in the West, not just to hide behind, sort of, accounting tricks. Let's just go to the basics here. Why did we ask for one third of the GST to be retained and directed into a national hospitals fund? We've got to make sure that this system is properly funded for the future, that's been the problem in the past.
HOST: And Prime Minister, sorry to jump in on you- but how will you fund it? That's a lot of money we're talking about.
PM: Well, I've always said to the states and territories there's no free money here. There's no blank cheque. That is why one of the most controversial aspects of this reform has been to get agreement from seven of the eight State and Territory Governments of Australia for the Australian Government to retain one third of the GST, put it into a national hospitals fund, for it to form the basis for the funding properly for the system into the future.
The second part of it is this- we can't transform this system overnight. That is, make sure that all of the changes that we need to see, in accident and emergency and elective surgery, are all delivered within the next two or three weeks. It won't happen that way. Therefore, what we have done is also provide additional investments right now to flow through for the next three or four years, to enhance accident and emergency, so that we can bring about a four hour target. Extra resources now to enhance elective surgery, so we can have 95% of patients treated within clinically accepted times, and we'll fund that within the budget.
HOST: How much is that worth? $5 billion, I think you said yesterday.
PM: Between 4.9 and 5.1.
HOST: Over what period?
PM: Between 2010- that's 1 July- through until 2014.
HOST: So you're going to have to make cuts elsewhere in the budget to accommodate that $5 billion?
PM: John, what we have done is worked long and hard over the last several months making sure that this allocation can be met-
HOST: Can be funded.
PM: Can be funded within the Commonwealth's overall budget discipline. But if we were not to do this, and to provide the extra doctors now and the training places necessary, the extra enhancements to the surgeries- in which people need to get their elective surgery done- more bays and more assessment units attached to accident and emergency, frankly, it would be a paper reform, that is, people would pretend that something was going to happen, as opposed to the substance being delivered.
So what I'm trying to do is bring about those extra doctors and nurses and hospital beds now, that is, in the period that's immediately ahead. That costs money. In order for us to deliver these improved targets for A&E and for elective surgery etcetera, into the long term future and put the system on to a secure funding base.
HOST: Sorry, I'm not the Treasurer, but I can see- you've got $3 billion of BER funding that's yet to be contracted, and I think you've got the insulation program due to start from July 1. Are they areas you could look at, in terms of trying to find the money for what you've just outlined?
PM: John, we have done this through our budget process, in a highly fiscally disciplined manner. Everything that I spoke to the Premiers and Chief Ministers about yesterday we had budgeted for. It is in the budget. And it will be delivered within our budget disciplines.
HOST: So those areas, that'll all still be delivered? You're not going to scale back the stimulus money, are ya?
PM: We have- let's just deal with that question in terms of the overall impact of making sure the economy keeps performing. If you go out into regional Australia right now John, you'll find that many parts of our country have unemployment rates in excess of 10%. Far North Queensland, 12.4%, other parts of the country, high single digits. This is not an even recovery across the country. And what we have done through the national economic stimulus strategy is keep hundreds of thousands of Australians in work, that task remains ahead.
HOST: (inaudible) yeah?
PM: We'll continue to implement our national economic policy and our fiscal policy, consistent with each other. But let me tell you, getting this country out of the events of the last 18 months, when every other country- major advanced economy- went into recession has been hard work. We're not out of- fully out of the woods yet in certain regions of Australia. But we have done this health and hospitals policy in an entirely fiscally disciplined fashion.
And I'd simply contrast that with our political opponents, who despite the public revenue being awash from the proceeds of the mining boom starting in the early 2000s. What did Mr Abbott do for five years as Health Minister? He ripped, instead, $1 billion out of the public hospital system, that is wrong.
HOST: Prime Minister, speaking of Tony Abbott- I know you've got to go- but a quick question, what's your reaction to his proposal, well, he's floated the idea reasonably well in Perth of banning the dole for people under 30 to try and get them to perhaps move to WA to fill the job vacancies that occur over there.
PM: It seems that Mr Abbott does a whole lot of policy on the run. Because I noticed when that statement was made yesterday, the Liberal party quickly went out and said it wasn't Liberal party policy. So we've seen a bit of this. Also, policy on the run, like Mr Abbott's great big new tax for his proposed paid parental leave scheme which would flow through to extra costs to working families, that is, cost to businesses and costs flowing through to the price of milk and the price of bread.
But can I just say this on health and hospitals reform- Mr Abbott has already unfortunately come out and opposed the Government's reform plan and our investment plan. I would appeal to him today, to come out and make absolutely clear that he will not use his numbers in the Senate to block these fundamental reforms to our health and hospital system, to deliver the biggest change in health and hospitals in Australia we've seen- since the introduction of Medicare about 30 years ago.
HOST: Prime Minister, thank you for your time this morning.
PM: Thanks for having me on the program.