Wednesday, 14 September 1983 Mr SPEAKER (Hon. Harry Jenkins) took the chair at 10.30 a.m., and read prayers. The Clerk-Petitions have been lodged for presentation as follows and copies will be referred to the appropriate Ministers: Chiropractic Services To the Honourable the Speaker and Members of the House of Representatives in Parliament assembled. The humble petition of certain citizens of Australia shows : That, with the exception of the Australian Capital Territory and the Northern Territory, all State Parliaments have enacted chiropractic legislation. That chiropractors provide a safe, effective and economical health care service that is complementary to medicine. That the introduction of a Federally funded health care system restricted to the services provided almost exclusively by the medical profession restricts the freedom to select the health care practitioner of one's choice and does nothing to reduce the high cost of health care in Australia. That a financial disadvantage will be incurred by those citizens utilizing chiropractic care, many of whom find that their health complaints do not respond satisfactorily to traditional approaches. Your petitioners therefore pray that the House of Representatives in Parliament assembled ensure that chiropractic services are included in Medicare when it is introduced. And your petitioners as in duty bound will ever pray. by Mr Adermann,Mr Andrew,Mr Braithwaite,Mr Cross,Mr Fisher,Mr Ian Robinson,Mr Scott,Mr White and Mr Willis. To the Honourable the Speaker and Members of the House of Representatives in Parliament assembled. The petition of the undersigned citizens of Australia respectfully showeth: That the 1983 Budget imposition of the excise on grape spirit used in fortifying wine places at risk the future of the fortified wine industry in Australia. That the requirement to pay the excise within 7 days of the fortification occurring is inequitable. That the excise will be reflected in increased costs to the consumers of fortified wines of up to 100 per cent and consumer choice will be restricted. That this will cause reduced fortified wine sales which will result in reduced intake of grapes from grapegrowers. Your petitioners therefore humbly pray that the Federal Government will reconsider their previous decision and either withdraw this tax or modify its method of application and collection. And your petitioners as in duty bound will ever pray. by Mr Andrew and Mr Bilney. To the Honourable the Speaker and Members of the House of Representatives in Parliament assembled. The petition of concerned people respectfully showeth their desire to stop the commercial exploitation of the kangaroo. Your petitioners therefore humbly pray that your Honourable House re-apply the ban on the export of kangaroo products. And your petitioners as in duty bound will ever pray. by Mr Cross and Mr Free. To the Honourable Speaker and Members of the House of Representatives in Parliament assembled: The humble petition of the undersigned citizens of Australia respectfully showeth: 1. That an airport in the north-western region (commonly called Scheyville) imposes disastrous economic, environmental and social costs on our community. 2. An airport would destroy 2,000 households and impose upheaval, noise and pollution on one million people presently unaffected. 3. The cost of an airport in the north-western region is greater than the alternatives, whilst fog and close proximity to RAAF Base Richmond would make operations impractical. 4. It would destroy the historic village of Pitt Town, environmentally important wetlands, and their unique adherent wildlife. 5. Your petitioners reject these proposals and call for endorsement of the MANS Committee findings. And your petitioners as in duty bound will ever pray. by Mr Cadman. To the Honourable the Speaker and Members of the House of Representatives in Parliament assembled: The petition of certain citizens of Australia electors of the division of Mallee shows that the terms of the U.N. Convention (treaty) on the Elimination of all forms of Discrimination against Women pose a very real threat to the Church, the Family, and to the Welfare of the Child and increases the threat of international control. And your petitioners as in duty bound will ever pray. by Mr Fisher. To the Honourable Speaker and Members of the House of Representatives in Parliament assembled. The petition of certain citizens respectfully showeth: That we women of Australia feel the threat of the nuclear arms race to our world, our children and our future. That the threat of nuclear war in Australia is greatly increased by the presence of foreign bases. That we affirm Pine Gap near Alice Springs is one such key foreign communication base, is a crucial link in the arms race, used for locating targets and therefore a prime target in the event of nuclear war. That we support the national womens' action to oppose the presence of Pine Gap and call for the removal of all foreign bases in Australia. And your petitioners as in duty bound will ever pray. by Mr Allan Morris. To the Honourable the Speaker and Members of the House of Representatives in the Parliament assembled. The humble petition of the undersigned citizens of Australia respectfully showeth: That the railway crossing situated approximately 5 kilometres east of Port Augusta on highway one (the main highway between Adelaide and all northern and western centres of South Australia and continuing through to Western Australia) has once again been the sight of an horrendous accident. This accident has caused two, possibly three fatalities. Previous requests have been made by the city council of Port Augusta for the construction of an overpass, so that this section of the highway no longer presents a danger to the motoring public and those involved in driving trains over this crossing. Permission for construction of this overpass has previously been refused and the situation has now become critical. Your petitioners therefore humbly pray that the Federal Government will reconsider their previous decision and approve construction of an overpass at this fatally dangerous railway crossing to avoid further loss of life. And your petitioners as in duty bound will ever pray. by Mr O'Neil. To the Honourable the Speaker and Members of the House of Representatives in Parliament assembled. This petition of certain citizens of Australia shows: That payments to contract and sub-contract owner-drivers of trucks are likely to be reduced by ten per cent on implementation of the new system of tax deduction at source from payments for work and services; That profit or personal remuneration constitutes a very small part of payments received by owner-drivers, compared with capital and running costs and government charges; and That a deduction of ten per cent of gross payments would not only be much greater than required to protect the revenue, but would also cause hardship to owner-drivers and their families. Your petitioners therefore pray that the Government will not require tax to be deducted from payments to owner-drivers. And your petitioners as in duty bound will ever pray. by Mr Rocher. To the Honourable the Speaker and Members of the House of Representatives in Parliament assembled. The humble petition of the undersigned citizens of Australia respectfully request: That the Government's decision to introduce a means test for over-70 pensions be reversed, as it will cause undue hardship and an unreasonable financial burden on a significant percentage of the aged population of Australia. Your petitioners therefore humbly pray that the Government will withdraw this legislation. And your petitioners as in duty bound will ever pray. by Mr Shipton. To the Honourable the Speaker and Members of the House of Representatives in Parliament assembled. The petition of the undersigned citizens of Australia respectfully showeth: That the majority of Australian pensioners are denied the human right to share fully in one of the foremost scientific advancement in communication of our time , namely, telephone communication. For 20 years the telephone rental rebate has remained frozen. Successive governments have exhibited a 'deaf ear' and/or a 'stoney-heart' to all appeals that this resource be more readily available at a time when it is most needed to maintain health and well-being. It is regrettable that the Government in announcing the pending increased charges in telephone rental and installation has not shown humane understanding in absolving pensioners from such increases, as indeed, in giving attention in maintaining the service as a vital necessity for daily living-for many, their only contact with the outside world. These facts of life impel your petitioners to call on the Federal Government as a matter of urgency to: Absolve pensioners from increased telephone charges. Adopt a policy that pensioners enjoy the benefits of scientific advancement, only calls be a charge. And your petitioners as in duty bound will ever pray. by Mr Willis. To the Honourable the Speaker and Members of the House of Representatives in Parliament assembled: We the Citizens of the City of Woodville and supported by the citizens of South Australia, being deeply concerned over the threat of closure of the Woodville Plant of General Motors-Holdens, respectfully show- 1. That the management of General Motors-Holdens has failed over a period of more than two (2) years to give any assurances that the Woodville Plant would continue in operation. 2. That a recent statement attributed to the GMH Managing Director, quote: 'The overall objective of our South Australian rationalisation plan has been to eliminate all productive activities on the Woodville site' end of quote. This statement has not been refuted. 3. That the elimination of the Woodville Plant will cause enormous social dislocation, hardship and misery to the citizens of Woodville and South Australia. Your Petitioners therefore pray that the Parliament of Australia will condemn this callous disregard for the citizens of Woodville and South Australia, and do all in its power to force General Motors-Holdens to retain its operations at the Woodville Plant. And your petitioners as in duty bound will ever pray. by Mr Scott. To the Honourable the Speaker and Members of the House of Representatives of the Commonwealth of Australia in Parliament assembled. The humble petition of the undersigned citizens of Mackay respectfully showeth: That the intention of Telecom Australia to close the Mackay Directory Assistance Centre will: downgrade telephone services to Mackay and district. deprive customers of a personalized reliable telephone service. reduce job opportunities in the area. increase the likelihood of the eventual closure of the exchange. We the undersigned believe that Telecom Australia has a social responsibility to provide a sound, reliable, personalized telephone system. Your petitioners therefore humbly pray that your Honourable House will call on the Government to intervene to stop Telecom's proposed closure of the Mackay Directory Assistance Centre. And your petitioners as in duty bound will ever pray. by Mr Cross. To the Honourable the Speaker and Members of the House of Representatives of the Parliament of Australia in Parliament assembled. The Petition of Residents of Mount Riverview respectfully sheweth that: There is a genuine need for a Post Office Agency selling stamps, Money Orders, letter and parcels registration and all business of a normal suburban Post Office, to serve the needs of a large and growing area placed approximately three and a half kilometres from such nearest facilities. The area has many aged and invalid people who cannot reach Blaxland to transact business. The local Chemist, situated in Mt Riverview Shopping Centre, is eager to handle such an Agency, and is a competent and reliable person to do so. Your Petitioners therefore humbly pray that your Honourable House will give earnest consideration to our request for such an Agency at a very early date. And your petitioners as in duty bound will ever pray. by Mr Free. Petitions received. Mr PEACOCK(Kooyong) —I give notice that, on the next day of sitting, I shall move: That this House- (1) Notes with grave concern the recent escalation of violence in the Lebanon and in particular abhors the provocative attacks on members of the multinational peace-keeping force by Syrian backed militia men, and, (2) Urges the phased withdrawal of foreign troops from the Lebanon and the re- establishment of peaceful co-existence amongst the Lebanese people. Mr SINCLAIR(New England) —I give notice that, on the next day of sitting, I shall move: That this House condemns the Government for selectively reducing the terms and conditions of employment of Australian servicemen as distinct from all other sectors of the Australian workforce in that it has- (1) significantly reduced the value to retiring servicemen of their Defence Force Retirement and Death Benefit through increased taxes; (2) removed tax exemption on Defence Force Reserves' pay, and (3) increased unemployment by the announced reduction of 732 in the number of full time uniformed personnel in 1983-84. Mr HODGMAN(Denison) —I give notice that, on the next day of sitting, I shall move-and the honourable member for Braddon will second-the following motion: That this House notes with shame that- (1) notwithstanding the notice of motion of the honourable Member for Denison given on 8 September 1983, the Government has still failed to provide one single job for any of the 377 workers displaced from their employment as a result of its action in halting the Gordon-below-Franklin power development scheme, and (2) the Government at the date hereof has still not paid one cent in compensation to the State of Tasmania. I shall give a similar notice of motion every day until the Government takes the appropriate action. Mr BRAITHWAITE(Dawson) —I give notice that, on the next day of sitting, I shall move: That this House- (1) notes the- (a) extreme difficulties faced by the sugar industry due to drought conditions, low prices and the Government's broken promises; (b) release of the Industries Assistance Commission draft report on the sugar industry; (c) condemnation of the sugar industry and the opposition to the findings of that report; (d) comments of the Minister for Primary Industry that he was awaiting the release of the report before making decisions on underwriting assistance to the industry, and (e) reduction of the Government's research funding to the Sugar Research Institute from $550,000 to $485,000 in 1983-84, and (2) calls on the Government to- (a) immediately implement an underwriting scheme for the sugar industry as promised before the election, and (b) increase the research grant to the level of its real value in 1982-83. Mr SINCLAIR(New England) —I give notice that, on the next day of sitting, I shall move: That this House condemns the hypocrisy of the Prime Minister who- (1) sought through a national advertising campaign to encourage participation in the Citizen Military Forces; (2) subsequently assured the Army Reserve of the Government's support for these forces, and (3) has now decided in the most cynical manner to reduce the numbers of reservists by 1,572 over the next 12 months and to tax the small emoluments received by the members of these forces. Mr IAN CAMERON(Maranoa) —I give notice that, on the next day of sitting, I shall move: That this House- (1) wishes the captain and crew of the Australia II every success in the America's Cup contest being sailed at Newport, Rhode Island, USA, and (2) asks that Mr Speaker send a message of good will on behalf of all from this place to all Australians involved in this great yacht race. Mr ANDREW(Wakefield) —I give notice that, on the next day of sitting, I shall move: That this House expresses its support for almost 3,000 petitioners from the Riverland area in South Australia, who have registered their dismay at the unprincipled decision of the Government to introduce an excise tax on fortified wines. Mr CADMAN(Mitchell) —My notice of motion complements that given by the Leader of the Opposition. I give notice that, on the next day of sitting, I shall move: That this House- (1) deplores the violence and turmoil in Lebanon as being the most significant factor preventing peace in the Middle East; (2) urges that all powers exerting influence in Lebanon to (a) face up to the turmoil, loss of life and lack of human rights they are creating in Lebanon, and (b) recognise the ambitions of Syria and the Palestine Liberation Organisation as being the only reason preventing the withdrawal of foreign forces, and (3) urges the Government to continue to follow the (a) excellent record of the previous Government by supporting the people of Lebanon in their goal of peaceful existence, free from external interference, and (b) leave nothing undone that should be done to aid and assist Lebanon. Bill presented by Mr Willis, and read a first time. Mr WILLIS(Gellibrand-Minister for Employment and Industrial Relations)(10.39) — I move: That the Bill be now read a second time. The purpose of this Bill is to repeal the Salaries and Wages Pause Act 1982. The Act which took effect on 23 December 1982 suspended the powers of various authorities to make or vary awards or determinations in relation to the remuneration and conditions of employment of Commonwealth employees for 12 months. The Act also prevented the Remuneration Tribunal and the Academic Salaries Tribunal from holding inquiries or making determinations or reports. Further, it has maintained the level of remuneration paid to pharmacists for the dispensing of certain prescriptions and has influenced the income of members of the medical profession by maintaining the level of fees approved for payment of benefits from registered health insurance funds. This action was taken by the previous Government prior to its approach to the Australian Conciliation and Arbitration Commission for a general wages freeze in both the public and private sectors. Such moves resulted from the clear disarray in which they found themselves following the wages explosion of 1982. That wages explosion was due in large part to the policies of the previous Government, especially its successful efforts to undermine the centralised wage fixing system which had existed since 1975. Following the destruction of wage indexation, the former Government found itself bereft of any workable wages policy. The encouragement of market-based negotiations on an industry basis clearly had disastrous results. Consequently, it returned to a highly centralised solution in the form of a wages freeze, which depended for its effectiveness on continued high levels of unemployment. After hearing submissions from the parties, led by the Federal Government, the Conciliation and Arbitration Commission decided on 23 December last year to introduce a wage pause for six months until June 1983 when it would review the situation. At that stage, it was decided by the Commission that its wages pause guidelines would remain in place pending determination of a national wage claim lodged by the Australian Council of Trade Unions. Submissions in the national wage case have now been completed and the Commission has reserved its decision. The Government submitted strongly to the Commission in that case that now was an appropriate time to end the wages pause and to introduce a system of centralised wage fixing based on full, six-monthly cost of living adjustments. Such a system, the Government argued, is fully suited to the needs of our times and is clearly in the best longer term interests of Australia. It protects the real incomes of wage and salary earners and provides for real increases over time, thus satisfying the basic demands of the unions for an equitable wages policy. It will also enable us to develop a new era in industrial relations, with an end to the bitterness which inevitably results from a decentralised, confrontationist approach. But, most importantly, it is a wages policy which, in conjunction with the board thrust of other Government policies, is conducive to a sustained economic recovery with greater job opportunities, reduced inflation, greater international competitiveness and improved business profitability. The Government is of the strong belief that, although the economy is only now beginning to emerge from the deepest recession for 50 years, it is the appropriate time to break the wages freeze and establish such a new wage determination system. To attempt to extend the freeze any longer would be a grave mistake. As the economy recovers, during 1983 and beyond, the capacity and determination of an increasing segment of the work force to seek and obtain wage increases will inevitably increase. Sectional claims would become more and more common, with every prospect of a new wages explosion occurring. Thus any effort to extend the wages freeze during a period of economic recovery would, in all likelihood, catapult the economy right back to where we were before the wage freeze-with wages out of control and rising incompatibly with inflation reduction or sustained economic recovery. Now is the time, therefore, before economic recovery takes off, for a new system of wage determination to be introduced. Although such a system will involve a wage increase at this stage, it will be to the long term benefit of the nation as a whole if it introduces a national policy which is acceptable and adhered to by the unions. As the decision of the Conciliation and Arbitration Commission in the national wage case is imminent, the Government has decided that the Salaries and Wages Pause Act should be repealed so that Commonwealth employees will once again be subject to decisions of appropriate arbitral tribunals. To do nothing could result in a situation where Commonwealth employees are unfairly treated vis-a- vis State government employees and the private sector. Repeal of the Act is necessary to ensure that the wage fixation principles determined by the national wage decision can be applied throughout Commonwealth employment without undue delay. Without prompt action, obvious anomalies and inequities will occur which could result in unnecessary industrial problems. Commonwealth employees will thus be treated on the same basis as other wage and salary earners who will be subject to the application of that decision. The Government's industrial relations co-ordination machinery will be used to ensure that Commonwealth employing authorities observe the spirit of the decision of tribunals in respect of employees not covered by awards or determinations. We will, of course, argue for a consistent application of the Commission's wage fixing principles before those other special tribunals whose powers are restored by the repeal of the Act . To facilitate the hearing of the national wage case whilst the Act was in place , a regulation under section 10 (2) of the Act has been made to restore power to the Public Service Arbitrator and the Conciliation and Arbitration Commission in respect to two specific determinations so that the technical opportunity was created for claims covering Commonwealth employees to be referred to the national wage Full Bench. The Act also had the effect of keeping in operation regulations made under section 4 of the Health Insurance Act 1973 which would otherwise have automatically ceased to be in force after the period of 12 months and 15 sitting days of the House of Representatives. These regulations set out the professional services in respect of which Commonwealth medical benefits are payable and the appropriate fee for Commonwealth medical benefits purposes, in accordance with which such benefits are determined. The present Bill, while repealing the Salaries and Wages Pause Act, would provide for the continued operation of these regulations for a maximum period of nine months from the date of commencement of the repeal Act. This would allow adequate time for any inquiry to be held to determine whether new fees for medical benefits purposes are necessary and for the preparation of new regulations prescribing any such fees. The Act also prohibited the Pharmaceutical Benefits Remuneration Tribunal from holding any inquiries for 12 months. That Tribunal is a body set up under the National Health Act to determine the manner in which the Commonwealth prices of pharmaceutical benefits are to be ascertained for the purpose of payments to pharmacists. Section 98BA (4) of the National Health Act requires the Tribunal to issue a report of its findings within 12 months of the date of its last report. When the Salaries and Wages Pause Act came into force the Tribunal had commenced hearings for its fourth inquiry and this inquiry was forthwith suspended. The last determination made by the Tribunal was in June 1982 in respect of the third inquiry. With the repeal of the Act the prohibition of the Tribunal's operations will be lifted and it will be free to complete that fourth inquiry or commence a new inquiry. Section 4 (2) of this Bill provides that a mandatory requirement for the Tribunal to issue a report every 12 months will not apply in respect of the first report after the repeal of the Salaries and Wages Pause Act. The Bill will allow a further six months for the Tribunal to issue its next report. After this, the arrangements will revert to those that are provided for in section 98BA (4) of the National Health Act. Finally, may I say that the Government is presenting this Bill of repeal now so that it will be possible, following passage, to seek royal assent as close as is practicable to the date of the national wage decision, which would then be permitted to apply equally to all in the public sector as well as those in the private sector. If, contrary to our expectations, the Commission decides not to award a wage rise at this time, Australian Government employees will, by passage of this Bill, be in no more advantageous position than employees in the private sector. I commend the Bill to the House. Debate (on motion by Mr Macphee) adjourned. Bill presented by Mr West, and read a first time. Mr WEST(Cunningham-Minister for Immigration and Ethnic Affairs)(10.49) —I move: That the Bill be now read a second time. The purpose of the Bill is to permit increases in overseas student charges which the Government announced in the 1983-84 Budget. Honourable members will recall that when the Overseas Student Charge Act was enacted in 1979 the maximum rate of charge was fixed by Parliament at $2,500 a year in respect of the enrolment of an overseas student in a prescribed course. This maximum level has remained unchanged for the last three years. The rates set in 1979 represented about 40 per cent of the average cost of higher education. To reflect changes in the cost of tertiary education the Government has decided that the charge will, from the beginning of 1984, be increased by approximately 15 per cent-from a minimum of $ 2,150 to a maximum of $2,900 a year. The new rate of charge will represent about only one-third of the estimated average cost of tertiary education in 1983. It is to be noted that, unlike parents of Australian tertiary students, overseas students and their parents do not contribute significantly to the cost of tertiary education in Australia through the taxation system. The charge on overseas students is therefore required to defray part of the cost of their education. The Treasurer (Mr Keating) has stated in the Budget that the estimated total number of students liable for the charge-excluding those whose liability is met by the Australian Government-was about 8,300 in 1982-83, yielding $16.2m of the total revenue of $19m. The number is expected to rise to about 11,300 in 1983-84 and account for $25.6m of the total revenue of $29.2m in that year, the balance being attributable to government sponsored students. The Government will continue to meet the charge for private students from Papua New Guinea and other developing countries in the South Pacific region, and also for students sponsored by the Australian Development Assistance Bureau. This assistance is part of Australia's aid program for this region. In the past few years, particularly in 1983, the numbers of overseas students admitted to Australia increased substantially over those of the previous year. The Government is concerned that as a result Australian students may not have been able to obtain places in the course of their choice at tertiary institutions. On the basis of advice from the Department of Education and Youth Affairs, the Government has decided that the number of private overseas students entering tertiary institutions in Australia in 1984 should be limited to approximately 4,000. This is still an increase of 400 over 1983. Included are 2, 500 overseas students who are now completing their secondary education in Australia. This means that the Government must limit the number of overseas students directly entering tertiary institutions in 1984 to 1,500. Further, we have decided that the number of new secondary students to enter Australia will be limited to 2,000. Thus, the total entry for 1984 will be approximately 3,500 new students, that is 2,000 into secondary institutions and 1,500 into tertiary institutions. I might refer to the lack of control exhibited by the former Government which has created the necessity to now curtail new entry to both secondary and tertiary institutions even though the total entering tertiary institutions will be increased by 400. For instance, total secondary new intakes from Malaysia surged from 1,100 in 1981 to 2,580 in 1983. Mr Hodgman —What have you got against Malaysia? Mr WEST —If the honourable member will listen he will find out the difficulties that can be involved. If we are to control future intakes into tertiary institutions it necessarily follows that we must now control secondary school intakes. Thus, the Malaysians have been restricted to approximately 1,050 new secondary students for 1984, a big reduction on 1983 but nevertheless equivalent to the 1981 total. Similarly, a total of 1,650 new secondary and tertiary students were admitted in 1981 from Malaysia. This rose to 3,200 in 1983. It will be approximately 1,640 in 1984, again, close to the 1981 figure. Mr Hodgman —What have you got against the Malaysians? Mr WEST —I have nothing against the Malaysians. The fact is that the former Government allowed secondary school student intakes to rise dramatically during 1982 and 1983. That now has a repercussive effect on those people entering universities from within Australia. That is the point I am making. I mention these facts to show that if secondary school intakes are allowed to increase dramatically over several years, we can expect pressure to reduce the new tertiary entry figures so that the total intake of private overseas students to tertiary institutions is commensurate with our ability to absorb them. Any criticism of our need to reduce moderately new entries from overseas should be directed squarely at the previous Government. The Government has decided to conduct a review of the private overseas student program, bearing in mind the large demand for places in Australian educational institutions, some existing inequities and difficulties in the administration of the existing program. The Government has appointed a committee under the chairmanship of Professor John Goldring, Professor of Law at Macquarie University. The committee of review has been asked to recommend changes to the private overseas student program which will achieve Government objectives-that is, to encourage private overseas students to study in Australia without reducing opportunities for Australian residents and without dramatically increasing public sector outlays. This is a complex and important task for the committee. Many aspects of the current private overseas student policy and procedures will need to be critically examined, including the proportion of costs of training to be borne by the student, whether priority should be given to students from particular countries, and the basis of future selection methods . The review committee has already called for submissions from interested governments, organisations and individuals. It is hopeful of the wildest possible consultations and participation in the review. Mr Speaker, the Bill substitutes the new maximum level of charges of $2,900 for the current maximum rate of $2,500 in section 6 of the principal Act. The actual fees payable will be specified by regulation as in the past. I commend the Bill to the House. Mr HODGMAN(Denison) —The Opposition intends to study the Overseas Students Charge Amendment Bill very carefully and accordingly I move-- Mr SPEAKER —Order! The honourable member is not entitled to address the House. He may formally move a motion that the debate be adjourned. Mr HODGMAN —I move: That the debate be now adjourned. Question resolved in the affirmative. Debate resumed from 6 September, on motion by Dr Blewett: That the Bill be now read a second time. Mr LIONEL BOWEN(Kingsford-Smith-Leader of the House) —Mr Speaker, may I have your indulgence to suggest that the House have a general debate covering this Bill, the Medicare Levy Bill 1983, the Income Tax Laws Amendment (Medicare Levy) Bill 1983 and the States (Tax Sharing and Health Grants) Amendment Bill (No. 2) 1983 as they are associated measures. Separate questions will, of course, be put on each of the Bills at the conclusion of the debate. Mr SPEAKER —Is it the wish of the House to have a general debate covering the four measures? There being no objection, I will allow that course to be followed . Motion (by Mr Lionel Bowen)-by leave-agreed to: That so much of the Standing Orders be suspended as would prevent the honourable member for Mackellar from speaking for a period not exceeding 65 minutes. Mr CARLTON(Mackellar)(10.59) —The Opposition opposes the Health Legislation Amendment Bill 1983-the Medicare Bill-for the following reasons: The Bill does nothing to improve the quality of health care in Australia. Indeed, it includes measures that will lead to the deterioration of service in doctors' surgeries and public hospitals. It is a major act of nationalisation, increasing taxation by $1.7 billion per annum to cover additional government expenditure previously met by private insurance. It means the sacking of 5,000 low cost private sector health insurance workers and their replacement by at least 2,500 high cost public sector workers and extra computers. It hides the real costs of health care. The $1 billion one per cent levy on incomes represents only one-eighth of the $8 billion spent on health by Federal and State governments. It hides the cost at the consumer level by providing so-called free services in hospitals and doctors' surgeries to people who can afford to insure. It threatens the continuing existence of private hospitals which make a major contribution to health care and puts extreme pressure on the public hospitals. It threatens the future of private medical practice by shackling doctors to a direct government payment system. Mr Deputy Speaker, the Health Legislation Amendment Bill moves health care in Australia substantially away from choice on the part of patients and providers towards increased decision making on behalf of patients by public servants and by politicians. To this Bill I move the following amendment: That all words after 'That' be omitted with a view to substituting the following words: 'the House declines to give the Bill a second reading as it is of the opinion that the Australian system of health care delivery and financing should be based on- (1) the private professional practice of doctors and other health professionals charging a fee for service supported by a private sector insurance system, and sympathetic government assistance to the aged and the disadvantaged, and (2) public and private provision of hospital and other institutional facilities and community health care, accessible to private practitioners for the treatment of their patients, supported by a private sector insurance system, and sympathetic government assistance to the aged and the disadvantaged'. We note that the other three Bills, the Medicare Levy Bill, the Income Tax Laws Amendment (Medicare Levy) Bill and the States (Tax Sharing and Health Grants) Amendment Bill (No. 2) are money Bills associated with this measure. We are, of course, opposed to the introduction and passage of these Bills, but, because they are money Bills, we will not vote against them in this House or in the Senate. However, we place on record our total opposition to the necessity for these three Bills which support what we regard as a thoroughly undesirable piece of legislation. Let me return to the Health Legislation Amendment Bill 1983. I begin by pointing out that the measure contains nothing that will improve health care delivery to the Australian people. It represents a major and disruptive change to the means of paying for health care delivery in Australia. It includes measures that will make it more difficult for doctors to provide an excellent or even adequate level of service to patients, and it includes provisions that will place great strain on our public hospital systems, leading to a deterioration in service in the hospitals and to waiting lists for admission. Medicare is not about improving the nation's health. Indeed, it contains flaws within its structure that will lead to a gradual but definite deterioration of health services. I shall describe these flaws in detail later. Of course, Medicare will not improve the nation's economic health. The second general point I make is that Medicare obscures the true cost of health care in Australia, both nationally and at the point of delivery. The Minister for Health (Dr Blewett) argues that by paying an identifiable health care levy of one per cent of taxable income people will have their attention drawn to the cost of providing health services. He also argues that the net additional cost to government of Medicare will be only $25m in 1983-84 and $62m in a full year. These figures are quite misleading. It needs to be understood that the one per cent levy is a politically determined figure. It bears no relationship to health costs. At current tax levels the one per cent levy on taxable incomes is expected to raise about $1 billion in a full year. The total cost of health care to Commonwealth and State governments in Australia is of the order of $8 billion. So the Medicare levy meets only about one-eighth or 12 1/2 per cent of that part of Australia's health bill financed by governments and, of course, even less of the nation's health bill if we include direct payment by the people themselves. Thus it is clear that the device of the levy, rather than drawing people's attention to the cost of health services, in fact, misleads people by a factor of over 8 : 1 as to the real cost of those services. I am often asked whether I think the Government will need to raise the levy beyond one per cent to cover the real costs of Medicare. At first I tried to estimate what the levy would need to be to make it an honest reflection of the real costs. I tried also to project the increases in costs that will inevitably arise from abuse of the so-called free system. I now realise that such calculations are beside the point. The one per cent levy figure is totally unrelated to costs. As I have already demonstrated, it covers only one-eighth of what taxpayers pay for health to Federal and State governments. It was never designed to be a real figure, it is merely a political device to pretend that Labor's health scheme will be cheaper. I turn now to the net and full annual costs of this scheme. Another aspect of the disinformation campaign being waged by the Government is its claim that Medibank will cost only an additional $25m in 1983-84 and $62m for a full year. Mr Howard —Phoney. Mr CARLTON —It is phoney, as the honourable member for Bennelong (Mr Howard) has said. This claim is arrived at by going through a series of additions and subtractions that obscure what is really happening. The Minister's Press release of 25 August 1983 on this subject included a table. I seek leave to incorporate in Hansard this short table. Leave granted. The table read as follows- FULL YEAR COSTING OF MEDICARE (1983/84 VALUES) Additional Expenditure $m Medical benefits 900 Hospital payments to States 709 Increase in private hospital subsidy 47 Community health services 20 Administration 66 1742 Additional Revenue Levy 1% taxable income 1050 Health insurance rebate 550 Reinsurance pool 80 1680 Net outlay 62 Mr CARLTON —I thank the House. The table shows the figures for the full year costing of Medicare in 1983-84 values and I am using the Minister's figures. In the first full year the additional expenditure on Medicare is as follows: Under medical benefits, $900m; hospital payments to the States, $709m; increase in private hospital subsidy, $47m; community health services, $20m; and administration, $66m-a total of $1,742m. Additional revenue for that period is as follows: A one per cent levy on taxable income, $1,050m, that is, just over $ 1 billion; health insurance rebate, $550m, which is the rebate which was taken away by the Government some months before Medicare came in against its clear promise during the election campaign; and the removal of $80m from the reinsurance pool-making a total additional revenue of $1,680m. The Minister says that this results in a net outlay of $62m. What is important here is not the thoroughly misleading balancing figure of $ 62m but the additional expenditures of $1,742m, offset only by the saving in $ 80m on the reinsurance trust fund. Thus there is a net additional expenditure of $1,662m-nearly $1.7 billion-requiring an increase in taxes of $1,662m to pay for it. This increase in tax is achieved by the one per cent levy which, as taxpayers will discover on 1 February 1984, is just an increase in income tax under another name and the less obvious but, nonetheless, real removal of the health insurance rebate which taxpayers will now not get in their 1984 tax returns. I repeat that, although there was a solemn promise not to remove that rebate until Medicare came in, it was removed on 1 July this year. The simple lesson worth repeating from all this is that the Government has increased government expenditures in the health field by $1,662m and the taxpayers will be paying $1,662m in extra tax to cover it. Once again, there is no free lunch. Let us look at the consumer price index effects of Medicare which were referred to by the Minister. He drew attention to these effects in his speech and he looked at the supposedly favourable effects of this massive increase in government expenditures on the CPI. He pretends that this is a real decrease in the cost of living, or at least a reduction in the rate of increase. The CPI is estimated by the Minister to be 2.6 per cent less than it would otherwise have been in 1984 because of the introduction of Medicare. Let no one be fooled by this piece of trickery. The nation's health costs will not have disappeared or been reduced by this measure. All that will have happened is that those items of health cost currently appearing in the Commonwealth Statistician's basket of goods and services used to measure the consumer price index will have been taken out and put in the taxation basket. Consumers will still be paying, but now through taxes rather than through insurance costs. The Australian Council of Trade Unions has simple mindedly accepted this shonky accounting as part of the prices and incomes accord, and pretended to its members that somehow they will be better off despite the fact that taxes will have gone up to offset reductions in private health insurance premiums. But the public will not be fooled. They know that costs cannot be made to disappear into thin air. The most cruel part of the CPI deception is to be played on the pensioners who are already getting free health care, those with pensioner health benefits cards . Under Medicare they will receive the same benefits, no more and no less, but they will be deprived of 2.6 per cent of their 1984 pension increases because of the artificial reduction of 2.6 per cent in the CPI to which their pension is tied. Mr Howard —Do you mean to say the Government is cutting pensions? Mr CARLTON —Let me correct that. Pensioners will be deprived of 2.6 percentage points in their pension. The Government is indeed-as the Deputy Leader of the Opposition (Mr Howard) points out-cutting pensions. The Minister did not announce that one effect of Medicare then is to rob single pensioners of $2.30 per week and married pensioners of $3.90 per week in 1984. Perhaps the Prime Minister (Mr Hawke) will make the announcement and explain how it squares with his election commitment that a Labor Government would 'not take money out of the pensioner's cheques'. The Government first introduced income testing for the over 70s, then lump sum taxing, then freezing the tax threshold, then assets testing and now this Medicare mugging. What a disgraceful series of hit and run attacks on the elderly. On top of this pensioners will find themselves queueing in doctors' surgeries and for elective surgery at public hospitals because their place will be taken by those who could well afford to pay for health insurance. Let us have a look at this supposed question of free services. At the delivery end of the system the Government again follows the irresponsible policy of disguising the costs of services. In public hospitals we revert to the system of making no charge for public hospital beds regardless of the needs of the patient . There will be no charge for outpatient services and pressure is being put on all doctors to make no charge to the patient for surgery visits but to accept 85 per cent of the schedule fee direct from the Government as full payment for the service. To increase the pressures put on doctors by patients to bill the Government direct, the Government has decided to ban 'gap insurance'; that is, insurance designed to cover the difference between the Government reimbursement of 85 per cent of the scheduled fee and the schedule fee itself. If patients know that it will cost them money out of pocket to make up this difference and if they know that it is official government policy to put pressure on doctors to bill the Government direct and accept the 85 per cent as full payment, many patients will threaten to change doctors in order to get a free service. The Government's aim is to force all doctors to bulk bill for all patients. As with free hospital beds and free outpatient visits, these free doctors surgery visits remove any sense of financial responsibility from the patient and also from the doctor. Ordinarily, the Opposition would welcome an insurance system in which the patient agrees to make a part payment at the point of service and as a result pays a higher insurance premium. However, the Opposition would not seek to prevent people insuring for 100 per cent of the schedule fee and accepting the penalty of a higher premium. We oppose both the compulsory nature of the ban on gap insurance and also the intention to use the ban to put pressure on doctors to move over to bulk billing for all patients, regardless of their means . It is worth pointing out, too, that this Bill imposes a total ban on medical insurance in Australia other than that provided by Medicare and by the Government. There is a parallel between the total ban placed on private hospital insurance under the Canadian system, of which the Minister is so fond. In Canada a person is not allowed under the law to insure privately for private hospital treatment, which I think is a disgrace and a scandalous restriction of human rights. This total ban on medical insurance other than that dished out by the Government is a move in that direction and it signals the intention of this Government, regardless of people's desires and regardless of their wish to exercise choice, to move in the direction of total government control. Implicit in the vast increase in taxation required to finance this exercise, amounting to $1.7 billion in a full year, on the Government's estimates, is a considerable expansion of the public sector. Medicare is not merely a transfer payment system taking money from some in the community and giving it to others to spend as they wish. It is also a nationalisation measure whereby some 60 per cent of the business of the voluntary health insurance organisations within the private sector of the economy is appropriated by the Government without compensation and given to an expanded government instrumentality, the Health Insurance Commission, better known as Medibank. As a direct result of this action by the Government, 5,000 employees of the private funds will need to be sacked from their jobs in February. Some will get jobs with Medibank, but the majority will not. The Minister bears the direct responsibility for these sackings, but his responsibility is now shared by the Australian Democrats, who have gone back on their solemn word to health fund employees. On 13 July this year Senator Haines of the Australian Democrats, at a meeting of the Australian Medical Association in Sydney, said: Now I am not, and never have been, the sort of person to turn my back on a fight. Medibank Private will get the sole agency rights to administer Medicare only after I have tried everything possible to prevent it-everything that is, short of voting against the levy Bill. That is what was said by Senator Haines, the spokesperson on health for the Australian Democrats. On the same day Senator Haines joined with Senator Harradine and me in warning the Minister not to proceed on this action without parliamentary approval, as we intended to disallow the relevant amendments to the Health Insurance Commission Act in the Senate when Parliament resumed. Well, what happened? Last week Senator Peter Baume on behalf of the Opposition moved to disallow the regulation as the first step in saving the jobs of 5,000 health fund employees. Senator Haines behaved in an extraordinary fashion. She voted with the Opposition as a purely technical acknowledgment of her formal commitment of 13 July, but arranged for her four Australian Democrat colleagues in the Senate to vote the other way, thus allowing the Government its way. She also claimed that she was impressed with the concessions she had wrung out of the Minister for Health and used these as an excuse for reneging on her commitment. What are these miserable concessions? The first is laughable; that is, that the funds could act as a post-box for Medicare. The Minister treated this so-called concession with contempt on the television program Sunday, pointing out that anyone could collect application forms and post them on to Medibank at his own expense. Anybody who watched that program-I got up especially to watch it-would have observed the brazen approach of the Minister in telling everybody in Australia, really, that he had conned Senator Haines on this matter, that the great concession she had wrung from him was totally meaningless, a post-box concession, and that anybody could collect Medibank applications and post them on to Medibank at his own expense. This made Senator Haines and the Democrats look absolutely ridiculous. Certainly the funds would not be paid for this task. No jobs would be saved in the private funds. The second concession related to gap insurance, a matter quite unrelated to employment in the private funds, as far as the Minister's decision goes. Senator Haines did not persuade the Minister to allow the private funds to offer gap insurance, a concession which might have saved a handful of jobs. He was persuaded by Senator Haines to spend an extra few million dollars of taxpayers' money on the centralised system Senator Haines had pledged herself to oppose. What was the Minister's proposal, which will come up I understand today in the form of a late amendment to this Bill? It is to set a $150 limit on the outgoings of any patient in summation of that patient's gap payments in the course of a year. This means that if the difference between the 85 per cent paid by Medicare and the schedule fee in total over a year for medical services adds up to more than $150, from then on for that patient the doctor will get 100 per cent of the schedule fee from the Government and not 85 per cent. That is the effect of the amendment as I read it. The amendment takes about five pages to get that particular point over because it is a very bureaucratic and extraordinary system. In fact I believe that gap insurance could be provided by private insurers for less than $150 a year. So the Haines proposal accepted by the Minister gets nowhere. It does not provide jobs in the public sector and it also leaves a loophole for additional overservicing because any patient who goes through a major series of operations or a major surgical incident may well achieve $150 of gap payments. From then until the end of the year any doctor seeing that patient who wishes to do so can get 100 per cent of the schedule fee and not 85 per cent as provided for everybody else in the community. Not only does the Minister deny the private funds the opportunity to provide gap insurance, but he also opens the door for further overservicing by unscrupulous practitioners. Other so-called concessions offered by the Minister direct to the funds but not to Senator Haines related only to the partial preservation of the remaining 40 per cent of their health insurance business after the nationalisation of 60 per cent. With the arms and legs removed, there will be an attempt to seal off the arteries but no microsurgery to restore the limbs. That is some concession from the Minister! While Senator Haines was proclaiming her victory and even being congratulated by the Advertiser newspaper in Adelaide last Saturday, the 5,000 employees she had deserted prepared themselves for the sack in February. Mr Howard —I would hate to see one of her defeats! Mr CARLTON —Indeed, as my honourable friend said, we would hate to see one of her defeats if this is a win. The Australian Democrats still have a chance to regain some measure of credibility in this exercise. The levy measures are separate from the health Bill. Senator Haines can still do what she said that she would do in July; that is, vote for the levy but not for the centralisation. She can also persuade her colleagues to do so. If the Democrats go back on their word once again in the vote on the Bill, their claims to act honourably and truthfully as watchdogs of the Government will forever be regarded as worthless. I will not go again through the Minister's pitiful arguments in defence of his shameful act of butchery. They are revealed once again in his second reading speech to be misleading and contradictory. I simply refer to my remarks in this House on 10 May this year, as reported at page 352 of Hansard, when I forecast this decision and when the Minister accused me of rumor-mongering. The Minister spoke with a forked tongue on that occasion, as in retrospect it is clear that he had already made up his mind. On 24 May the Minister announced the decision to slaughter and again I exposed the fallacies in his argument-page 847 of Hansard. Finally, on 24 August this year, following the presentation by the Minister of the interim annual report of the Health Insurance Commission, Medibank, I pointed out that nothing had changed in the interim to strengthen the Minister's argument-page 179 of Hansard. This Minister remains responsible for the first major cause of unemployment in this Labor Government. It will not no doubt be the last, but it will be noteworthy for the chilling ruthlessness with which it has been carried out and for the vindictiveness against the voluntary funds that lies behind it. It will not be forgotten by the Opposition. Least of all will it be forgotten by the 5,000 innocent victims of this purge and their families. Let me turn again to the Medicare scheme itself. What is its justification? Might it not have been possible to remedy what might have been seen to be defects in the existing system without all this turmoil? I think it is worth recalling what the existing system is. The main features of the existing system of health care are these: Free hospital and medical cards for pensioner health benefit and health care card holders are provided so that pensioners, low income groups and the unemployed can get free hospital and medical care. This takes up about 20 per cent of the Australian population. Under the present scheme the remaining 80 per cent of the population are expected to take out private health insurance to the level they wish to cover themselves for. A basic insurance of about $13 a week, subject to a tax rebate of 30c in the dollar before this Government removed it, covers public hospital costs without choice of doctor and 85 per cent of the schedule medical fee with a ceiling of $10. That is similar to the basic provision of Medicare that the Government wishes to introduce. There are other levels of insurance to cover people for choice of doctor in a public hospital, for a private hospital bed and for additional services such as dentistry, physiotherapy, chiropractic and so on. The Government under the existing scheme subsidises private insurance in four ways. Firstly, there was a 30c in the dollar tax rebate on basic insurance premiums. This was the one removed by the Australian Labor Pary in its May statement from 1 July, costing families an extra $4 a week. There was a 30c in the dollar subsidy of the medical schedule fee paid to the voluntary insurance funds so that every medical visit was subsidised by the Government, by the taxpayer, to the extent of 30c in the dollar. There was a $100m subsidy of the Reinsurance Trust Fund. This is the Fund which the private funds can draw on to deal with the chronic cases. In other words, this was a subsidy by the taxpayers of $100m to ease the burden of those who went into substantial periods of illness. This Government cut that reinsurance pool from $100m to $20m, again in the May statement. It took $80m out of the funds of the contributors to the private funds to make its sums on Medicare look better. There is also under the existing system a $16 a day subsidy for medical beds in private hospitals and a subsidy of $28 a day for surgical beds in private hospitals. These are balanced against charges through the public hospitals, which means that the private hospitals are not disadvantaged under the system. The advantages of this system of health insurance are that it looks after the disadvantaged, the 20 per cent of the population who need free care; it allows wide consumer choice; it provides some discipline in the use of services through user payments; and its promotes private medical practice in private hospitals on which the general health of our health care delivery system depends. It had certain disadvantages which I acknowledged when the Minister felt that we could improve over time. There was concern expressed by the present Minister, which I accepted as a concern, at the sudden death cut-off of the free medicine when one went above the 20 per cent provided free, which was hard for low income families . There was also the delayed action effect of the tax rebate which made the cost of one's weekly outgoings look higher than they would be in the long term. Also I believe there was too limited competition in the insurance market because it was difficult for commercial insurers or prepaid schemes to enter the market. I also believe that there were not enough disincentives for overuse of medical and hospital services within this scheme. These disadvantages, which I certainly acknowledged as Minister and have acknowledged since then, could be removed by fairly simple legislation and by relatively minor adjustment to the scheme. They would have preserved the advantages of the existing system and brought in more competition to the market place and certainly greater disincentives for overuse of medical and hospital services. Was it necessary to overturn the whole of the existing scheme and to nationalise 60 per cent of the health insurance business in order to overcome whatever defects there were in that scheme? The Opposition clearly believes that this is a ridiculous way to go about remedying any defects and that it introduces methods of financing health care which go against and, indeed, reverse the advantages of the existing scheme. Let us look at those methods in greater detail now. First of all, let me look at the effect of Medicare on the doctors. We need to say quite a number of words to the doctors who are very divided in many respects on Medicare. The Minister for Health (Dr Blewett) has noted that the Australian Medical Association has been less vociferous in its opposition to Medicare than to Medibank. Doctors of course have been terrified of the threats made to them by the Minister before he became the Minister during the period of the inquiry of the Public Accounts Committee. Most doctors believe that in taking a strong line to push their ideas they would have been met very publicly with threats by the Minister to leave them less disadvantaged than they might be under the outline of the scheme. I think their fears are justified. The Minister has taken the same line with the Voluntary Health Insurance Association. But doctors generally must understand what this means for them and their profession in the longer term. Fundamentally, this move by the Minister will take us a long step away from the ideal of private professional practice where the contract between the doctor and patient is not interfered with by a third party to the ultimate destruction of that relationship. Let us look at the steps that will occur. The first step is to get all doctors to accept 85 per cent of the schedule fee direct from the Government without any patient involvement in the transaction. The Minister makes no bones about his objective. He has given three options for payment by people of their medical bills. But the one the Government prefers and the one it has backed up by the device of prohibiting gap insurance, making it more difficult for people to pay for the gap-the one it clearly favours-is the direct payment of 85 per cent of the schedule fee by the Government, by the taxpayer. So down the line, doctors will succumb to pressure within particular areas, such as the market forces referred to by the honourable member for Capricornia (Dr Everingham) earlier. These are the sorts of market forces that apply when a government player with a limitless purse is involved. That is the sort of competition to which the honourable member referred. In any locality where some doctors decide to bulk bill and where they get more patients coming into their surgeries other doctors start to lose patients because people see a value initially in a free surgery consultation. The doctors who are left behind find that their practices are operating below their break-even points because their practice costs must be met. They will be bludgeoned into going on to this direct billing process, accepting 85 per cent of the scheduled fee. Dr Everingham —All they have to do is reduce their fees-free market pricing. Mr CARLTON —The honourable member for Capricornia is talking total nonsense. There is no such thing as a free market when one of the players is the Government using taxpayers' money. The honourable member knows that very well. How can one compete with doctors who have an intravenous feed into the Treasury? In competing with them one is competing with their use of taxpayers' dollars. That is no market place and never will be. So the next step if this Government remains in office for very long, and heaven forbid that will happen, is that gradually, inexorably the Minister will achieve his objective of virtually 100 per cent of medical practitioners accepting 85 per cent of the schedule fee from the Government. What happens to doctors placed in this sort of squeeze because, after all they will receive only 85 per cent of the schedule fee and some of them charge a bit more than the schedule fee anyway, as they are entitled to do in a free situation? If they are charging only the schedule fee how will they make up the difference of 15 per cent? Admittedly, some of the difference might be made up by not having to worry about sending out accounts and collecting bad bebts, but that is nowhere near 15 per cent. The way they will be tempted to make up the difference is by seeing people more often and by operating on the schedule so as to improve their income. This is an extraordinary temptation to put before a profession which has already been subject to that kind of temptation by the relatively limited intervention which we had under the previous Government. What will be the response of the Minister? We heard his answer to questions in this House yesterday relating to the doctors. It was the first time that the doctors had come out and said something rather sharp about the Minister's scheme . He responded in the way in which he will increasingly do. He will get back to his hectoring, attacking style in relation to the profession he employed before he became Minister for Health and while the Public Accounts Committee was conducting its investigations. There will be a public outcry then that the doctors will be charging more, the meters will be ticking over faster as they did last time under Medibank. Then the Minister will say: 'We will double up the fraud and overservicing detection system'. He has already announced this. In the Budget the $4m previously spent on fraud and overservicing detection systems is now doubled to $8m-$8m for the policing of doctors because the Government is scared that the meters will tick over faster under a direct billing system. I liken this way of dealing with overservicing to the policeman going down the High Street at dead of night, seeing that the door of Woolworths is open and, instead of closing the door, sitting on the opposite side of the road, counting the goods going out through the night and subsequently trying, on the basis of computer profiles that he has developed of goods going out during the night, to find out who the culprits are. That is the solution of this Minister to any problems of overservicing by the medical profession. By doubling from $4m to $8m of taxpayers' funds the amount spent on the policing and surveillance systems he is introducing a new reign of police state affairs into the control of something which is extended by the very mechanisms which this Government is bringing into force. I think that this is going down a fundamentally mistaken path. If there are difficulties with the amounts going out through doctors' surgeries under the present system there are ways of dealing with them which make doctors and patients more responsible. This method makes the policing system more responsible. Of course it will not work. In any case there will be difficulties initially on the numbering system. In order to take people to medical services committees of inquiry or, if the problem is much more serious, to investigate fraud we must have a series of information which is consistent over a long period. I very much doubt whether the new Medicare card numbering system will be in any way transferable or traceable back to the original numbering system of the private health insurance funds. I will be watching very closely and, indeed, I ask the Minister to respond in the debate during the Committee stage as to whether there is a continuity of numbering between patient records-not just the doctors' servicing, but patient records-in the old system with the private health insurance funds keeping the records and the new Medicare card numbering system. If there is not an immediate transfer of information from one system to the other the historical records on which fraud and overservicing detection systems are based will not be able to be used. There will not be consistent information on patients, although there may be information on doctors, which will enable this system to work. Fundamentally the Opposition is opposed to introducing a system which opens up the door of Woolworths in the High Street at night and lets the goods go out. Instead of shutting the door and looking at the cause of overservicing this system it pushes people into overservicing and then introduces police state methods to try to overcome it. What about the other health professionals in this whole equation? I wish to say something here about such people as physiotherapists, dentists, clinical psychologists and chiropractors. All of them have been making representations to us to support their claims to the Minister that they should be admitted to Medicare. During the period of our Government we received similar claims and representations. I must say that I had a great deal of sympathy for these professions because the doctors were receiving very substantial public benefit through the taxation system while these people, unless they were in the public sector, were left on the outer. These people relied totally on their patients' private insurance. Therefore we knew that anybody going privately to any of these people believed that they were getting good service. I have heard countless stories of the very great contribution to health care delivery in Australia by this group of related professionals. I certainly have great sympathy for them. It would have been my intention to try to even up the situation between them and the doctors over a period; but in all honesty the Opposition cannot support the entry of these additional professional groups to a nationalised, socialist system of health care finance which we fundamentally oppose. I have carefully gone through the difficulties of the medical profession as a result of even the previous system. I have taken those forward into what I think will be increasing difficulties for doctors under the new system. Would any of these professions wish to get into the kind of conflict that the doctors will get into with this Minister by joining this scheme? The Opposition, sympathetic as it is to these groups, cannot possibly support their addition to a system of which on the whole it thoroughly disapproves. I now turn to the effects of the Medicare proposals on the hospital system. The private hospitals have been very worried about what is to happen to them under Medicare. This is not surprising, given the ideologically motivated attacks on them by this Government and its sympathisers and also by State Labor Ministers for Health, who miss no opportunity to express their distaste for any non- government activity in health care delivery. It is a parallel situation to the attacks on private schools by the Minister for Education and Youth Affairs, Senator Ryan. Just as religious schools of all denominations are being squeezed by Senator Ryan, the hospitals operated by religious orders and voluntary bodies are threatened by Medicare and by this Minister. I make it quite clear on behalf of the Opposition that we stand firmly by the private hospitals and nursing homes, whether they are operated by non-profit organisations, including religious orders, or by proprietors honourably earning a profit by providing a desired service. We would like to see such private activities in the health care field extended rather than reduced, thereby providing greater choice to consumers, wider opportunities for innovation, more responsible attention to costs and release from the entangling web of restrictive practices imposed by unions and others with such devastating effect on publicly-owned health services. State Labor Health Ministers should also welcome this kind of competition beside their massive and unwieldy central health authorities. No doubt they would welcome it for purely pragmatic reasons if they were not bound by their political platforms to the mindless preservation and extension of the public sector. The great fear about Medicare-it is not a groundless fear-is that the new insurance and reimbursement arrangements load the dice in favour of the public hospitals without giving those hospitals the additional resources to meet the fresh rush of patients. Under Medicare a patient, regardless of means, will be entitled to a free bed in a public hospital provided he or she accepts the doctor decided on by the hospital. So much propaganda is put out by the Government suggesting that Medicare will cover all health needs that many people will actually believe it and not bother to take out additional private insurance even though they could afford it. That is a particular worry in regard to the pensioners. It would be most unwise for them not to take out additional private insurance, as the choice of doctor in the event of a serious illness is something for which most people giving the matter serious thought would be prepared to make some sacrifice. Any reduction in the percentage of the population taking out private hospital cover will lead to additional claims for admission to free hospital beds in public hospitals. That must follow; it is simple logic. If the public hospital beds are already under pressure, as they are in many city and suburban locations , people will have to wait for admission. One can imagine the results of that. We will finish up with a British national health situation where patients wait ages for necessary operations. Dr Klugman —Even unnecessary operations. Mr CARLTON —The honourable member, being a doctor, should know that many operations decided to be unnecessary by bureaucrats and politicians cause enormous pain and discomfort to many people. Under the British national health system, people with hernias who are supposed to be working cannot get an operation for over 12 months. Of all people in this House, the honourable member should know this. Who decides who needs what? This Medicare scheme determines that the people who decide who needs what will be decreasingly the patients and providers and increasingly the bureaucrats and the politicans. If we wish to take to its extreme what is happening in this case we look at the British situation which the honourable member for Prospect conveniently overlooked. To give an example of this I refer to the Victorian Bush Nursing Association. The Executive Director of this Assocation issued a Press release just over a week ago which stated: Categorisation of private hospitals is a major disaster. Under this proposal- he was referring to the Medicare scheme- benefits payable by the health insurance funds will, for most bush nursing hospitals, be $80 per day. A Commonwealth subsidy of $20 will also be paid providing a total income- to the hospital- of $100 per day. As there are only four bush nursing hospitals with average daily bed costs below $100, it is obvious that thirty-four bush nursing hospitals will be in severe financial difficulty within a matter of months after the scheme is introduced unless patients are prepared to pay up to $55 per day. That cost will not be covered by the basic table. I was given this morning the example of a hospital in Euroa in Victoria, classified as C category, getting this level of benefit. It would get $80 from the funds and $20 from the Commonwealth Government, making a total reimbursement of $100, and the actual cost of a bed is $146. Dr Blewett —Have you checked those absurd figures? Mr CARLTON —So the bush nursing hospital in Euroa will have to ask people to pay an additional $46 for admission. Dr Blewett —You would believe any story you were told by any vested interest. Mr CARLTON —The Minister questions whether I would accept all figures unchecked. I am bringing these figures to the attention of the House because the Minister has refused to see this group. The Press release continued: An attempt to see the Minister for Health, Dr Blewett was unsuccessful and the Department of Health in Canberra 'misplaced' its copy of a detailed submission made to the Minister by the Association. I telephoned the Association this morning. It still had not heard from the Minister even though it had sent him a new copy of its submission. The onus is on the Minister to check out these matters and if necessary to refute them; it is certainly not on me. He is the responsible Minister. I just use this as an example of the grave threat to country health services. There are nearly 40 of these hospitals in Victoria. They make up one-third of the private hospital system in Victoria. Mr Lloyd —Six in the Murray electorate. Mr CARLTON —There are six in the honourable member's electorate. The next step in this process is that some people will realise that they have to take out private hospital cover and will do so at the minimum level, entitling them to the choice of doctor in a public hospital and shared ward accommodation. This will be the category C, where we have this sort of hospital, and other categories that will get higher reimbursement depending on their level of services. If they go to a public hospital, they will be able to get choice of doctor and they will pay nothing. But if they go into a private hospital for a six-day stay, including, say, surgery, they could have to pay up to $40 or $50 a day additional bed charges and perhaps $200 or more in theatre fees which would not be covered by Medicare, and they could be out of pocket by $400 to $500 for an average six-day surgical stay in a hospital. Even if the sum were only $200, surely they would be tempted to try harder to get into the public hospital system and pay nothing, and further pressures are thereby put on the public hospital system. The Minister has suggested that this kind of private cover, at the minimum level, will cost $5 a week for a family. No justification has been produced for this figure, which is one that will be charged by the remnants of the private health insurance industry. How do we know that $5 will be enough for basic private hospital cover? I have heard estimates within the industry as high as $8 a week. What will the figure be? It is of very considerable importance, because it affects the costs of health care for every family in Australia. Until we know what it is, we have no means of judging exactly how false are the Minister's claims for the costs of Medicare for the family. What we do know, however, is that it will cost considerably more than $5 a week to insure for higher levels of private hospital treatment, an insurance that would guard people against the large extra bills that they will meet if they are on the lowest private hospital table. Of course, beyond that, they will want extra cover for dentistry, physiotherapy, chiropractic and the like. Many families will get a nasty shock on 1 February 1984 when their tax rises by one percentage point and they also find, to their dismay, that they must take out a great deal of additional health insurance. Bear in mind, too, that under Medicare, there will be no tax rebate for health insurance premiums. Let me summarise what will be the effects of this scheme on consumers. The first effect is clearly the disruption and uncertainty of a full-scale change to a new system which is totally unnecessary. It will lead to two-stop shopping. If a person wants to take out additional insurance-over half of the people who insure these days do that-it will be necessary not only to deal with Medibank but also to deal with a private fund; that is two-shopping. There is great uncertainty about the costs of this system. The Minister has said that a third will pay more. Maybe more than a third will pay more. This ignores, of course, the taxation situation. It will be recalled that I said that the one per cent levy meets only one-eighth of the government payments for health care in Australia, so what a person pays on the levy is no indication at all of the real costs to the taxpayer of health care. There will be more going out in ordinary unmarked tax dollars from people than there will in the one per cent levy. We must understand that. The one per cent levy is purely a political figure; it has nothing to do with costs. Many people could find themselves uninsured. The Government's propaganda as to how marvellous Medicare will be might fool people into thinking that they can get way without taking out extra private insurance. The pensioners will be disadvantaged, because those who are on pensioner health benefit cards will be affected by the 2.6 percentage points difference in the consumer price index next year, as forecast by the Government. They will miss out on pension increases in 1984 of about $2.30 for a single pensioner and $3.90 for a married couple. Mr Saunderson —Ha, ha! Mr CARLTON —The honourable member may well laugh at this, but they are the figures. Consider the drop in the CPI. These people are getting free health care now. Next year they will be getting exactly the same benefits. The CPI will be down by 2.6 percentage points, and that means that pensions will not rise by that 2.6 per cent for purely artificial reasons, so pensioners will be missing out in this situation. Beyond that, and looking down a bit, because of so-called free treatment in doctors' surgeries, the queues will begin to form in doctors' surgeries. The doctors who provide so-called free treatment will start to get full surgeries. The disadvantaged and the poor will be at the end of the queue, as they have been in Britain. These systems do not work. In the public hospitals , which are already under pressure-there are waiting lists in certain areas, particularly metropolitan areas, for surgical procedures-the same so-called free beds available to people without means test will put more pressure on the public hospitals because the private hospitals will be disadvantaged and will lose patients. The way in which we sum up how the consumer stands in relation to Medicare is best illustrated by going back to the policy speech of the Prime Minister (Mr Hawke) for the election in March. The Prime Minister made this solemn promise: It will mean that nine out of 10 Australians will pay less for the health needs of themselves and their families. At the very time that he made that promise, it was wrong, because two out of 10 already got free cover, so it was impossible in any case from the start. The pensioners and the others still had the cover. Under this scheme, pensioners will still need to take out private cover if they want choice of doctor. So certainly, out of that two out of 10, they do not get anything better than they currently get. The Minister, in using his assessment, says that two-thirds of the remaining 80 per cent will be better off and will pay less under Medicare. Even if we accept that, two-thirds of 80 per cent is 53.3 per cent of the population. The Prime Minister claimed that nine out of 10 Australians will pay less for the health care needs of themselves and their families. We have pointed out that two out of 10 already got it for nothing, so that is impossible. The Minister varied that and said that maybe it is seven out of 10. Now he says that two- thirds of 80 per cent-which is 53.3 per cent by my calculation-will pay less. That is on his estimates of private health insurance extras; and his estimates are not worth a crumpet because he is talking about $5 a week and the funds have not even been able to work out what they can charge yet, and they will not know until 5,000 of their employees have been sacked in February, when they will know what their overhead costs are. The changes are that their overhead costs will be higher in relation to premiums than they were previously because they will have lost economies of scale. So the $5 figure is not worth a crumpet and, of course, it will be higher for private beds in private hospitals and for multicover and the like. What is the Opposition's stance in relation to this legislation? What would the Opposition do in this area? The Opposition is carefully looking at all its policies in each area, carrying out a complete review, and that includes the health care delivery area. Our full policy on this will be announced as soon as we have done the necessary work and checked it out with the various people who will have an interest in it. However, we make it clear that we could not live with certain key aspects of Medicare. Let this be perfectly clear. We cannot live with bulk billing for general patients as opposed to the disadvantaged. We cannot live with so-called free public hospital beds regardless of patient's means. We cannot live with the attacks on the private hospitals. We cannot live with the attacks on private medical practice. We could not, in government, allow such provisions to remain. I make that absolutely clear. I have said that already previously. The Opposition is absolutely united on those four points relating to this scheme, which we would not be able to maintain on a return to office as we see them as being destructive of the provision of good health care in this country. So where do we stand? We stand at a very crucial turning point in the delivery of health care in Australia. The Government, regardless of overseas experience, regardless of experience of certain aspects of the existing scheme, regardless of the inquiries by the Joint Commitee of Public Accounts, regardless of all the available international evidence, has decided to go back on a 20-year-old experiment, an experiment of a kind that will certainly reduce consumer choice, patient choice, and will inexorably move choice in health care away from patients and providers and in the direction of public servants and politicians. There is no suggestion by the Opposition that in the end the Government will not control the costs of this scheme. We are quite certain that in the beginning the costs will start to run away; but by force majeure, as has been tried in England , one can contain costs by squeezing the system dry-squeezing, ultimately and inevitably, the poorest and the least advantaged. That has been the end result of the system in Britain, and the system in Canada in moving rapidly in that direction. If there is so called free provision with no responsibility on the part of the patient and minimal responsibility on the part of the doctor or the provider, subject only to some overall computerised 1984 surveillance system, there will be increasing usage of services which are unnecessary. The figures in Canada certainly show this. The figures in Australia certainly show this, even on the limited subvention that has been given to doctors under the present scheme with the disadvantaged patient. The evidence is there that the kind of experiment on which we are embarking at this nation's expense will lead inexorably to the difficulties in service delivery that have occurred over the last 30 years in Great Britain. What the country also needs to understand is that this is a major, old fashioned, nationalisation measure. We cannot add $1.7 billion to Federal expenditures on any single item without fundamentally altering the balance between the public and the private sectors of activity. Under these provisions $ 1.7 billion is being transferred from the private sector to the public sector. Five thousand employees-low cost ones such as Federated Clerks Union of Australia employees-are to be transferred; they are to be sacked. An additional 2,500 expensive union employees are to be taken into the public sector, with all the managerial apparatus that that involves. The scheme will involve a substantial transfer of resources and authority from the private to the public sector. If this legislation is not rejected by the Senate this nation will take a path which is fundamentally in error and which it will certainly regret in the future . I think it has to be made absolutely clear on behalf of the Opposition that, however awkward and unpopular it might be at this point to seek to illustrate the facts of life in relation to this measure, the Opposition will not draw back from talking about them. The Opposition will point out why this is an historically mistaken step. That will become clearer to people once the scheme gets closer to implementation and aftewards. The end results will become clearer as the months and years draw on. The kinds of things we have to say at this point, however unpopular they might be in certain quarters, will be seen to have been necessary and true. I have a great deal of faith in the Australian population because I think they have learnt over the last 20 years that there is no such thing as a free lunch, that health care is not free and never can be, and that the good health care we have in Australia is worth preserving. It is worth paying for, and it is worth keeping as much of it as we possibly can within the private sector of our nation's activity. Mr DEPUTY SPEAKER(Mr Rocher) —Order! Is the amendment moved by the honourable member for Mackellar seconded? Mr MacKellar —Mr Deputy Speaker, I second the amendment and reserve my right to speak. Dr KLUGMAN(Prospect)(12.5) —I suppose it is not a great secret that I have some reservations about the Medicare proposals. My reservations are exactly the opposite from the predictions of the shadow Minister for Health, the honourable member for Mackellar (Mr Carlton). I think exactly the opposite to what he predicts will happen. He predicts that there will be socialisation or nationalisation of the health care industry, doctors, et cetera. I think exactly the opposite will happen. In fact, my main reservation about the proposal is that it enshrines private fee for service medicine which, I hope to illustrate a little later, is not good not only for ideological reasons but also mainly for medical reasons. The shadow Minister's remarks contained massive contraditions which were repeated again and again. The first point I would like to take up with him, because it is the main point that has been pushed in the Press, is the alleged loss of 5,000 jobs in the private health sector and the implication that those jobs will disappear altogether and 5,000 more people will be unemployed. To me it is a sort of Alice in Wonderland situation that the honourable member for Mackellar, who was trained by McKinsey and Co. Inc. to be a good manager in a capitalist society, attacks us for introducing greater efficiency causing job loss. I am afraid that I do not share his belief that government enterprise is necessarily more efficient than private enterprise. The total number of jobs in the health industry will probably be similar or even greater after the introduction of Medicare. On two occasions during the shadow Minister's speech the honourable member for McPherson (Mr White) by interjection attacked what he sees as a conversion of doctors to Public Service status. It was interesting to hear the honourable member, who as I understand it comes straight from the Services, attack the Public Service status of doctors or of anybody else. It reminds me of President Eisenhower, who had a similar career, although possible on a more exalted level, in both the Services and politics, but the honourable member for McPherson is younger. When President Eisenhower had put to him propositions similar to the ones being put in this legislation he took a similar line in favour of private medicine. Yet President Eisenhower and his wife had always been treated by Army or veterans' affairs doctors. His father was a full time officer. He lived with his father and received treatment from Army doctors. From there he went to the West Point Academy and he went on to receive medical attention continuously from Army and veterans' affairs doctors. When he was President and made that statement he had a full time doctor attached to his staff. He had never paid a cent for health services. His statement was utter hypocrisy. On the subject of public funding, I can give honourable members a similar example of hypocrisy which arose during the last few weeks. The current President of the United States of America, President Reagan, took $31m of public funds for his election campaign and then came out strongly in opposition to public funding. When he had to hand in his tax return he showed in television that he had crossed off the option of having $1 of his tax go towards public funding, but he was perfectly happy to accept $31m towards his election to the position of President. As I said earlier, my main reservation about the introduction of Medicare is that it enshrines fee for service medicine which, to my mind, is bad not only for ideological reasons but also, more importantly, for medical reasons. It brings about excessive surgery and excessive treatment. We get all kinds of excesses. With due respect to my colleague the honourable member for Capricornia (Dr Everingham), we get orthomolecular medicine and like developments in which doctors will send patients for a complete review which will cost $600 or $700. It does not cost the patient anything and the doctor collects his money from the Government. There has to be some restraint on the part of the patients. There has to be a patient moiety which I may mention in a minute. In passing, I refer to the long waiting time, allegedly, in the United Kingdom for surgery. This is, of course, for elective surgery, surgery for such things as tonsillectomies. When I was in the United Kingdom having a look at its system I found that what was happening-I am not necessarily defending its system, as will become clear later-was that when a child had enlarged tonsils he was automatically put on a waiting list at some hospital. There would be a waiting list of some 600,000 kids for tonsillectomies. What is important is that, because they were non-urgent cases, by the time they reached the point when they could be admitted for a tonsillectomy it was no longer necessary. The important point with much of the elective surgery is that it is not necessary. The situation is similar to that pertaining when the shadow Minister for Health was a Minister. In many cases he did not answer letters straight away. If he waited a couple of weeks or even six weeks there was often no need to get involved in a brawl because the problem had solved itself. It is exactly the same in medicine. My rather cynical view on surgery is best expressed by one of my favourite cartoons in which a doctor says to a patient: 'I am afraid the trouble is your appendix'. The patient says to the doctor: 'I would like a second opinion'. The doctor replies: 'It could be your gall bladder'. Mr Hunt —But we will take it out anyway. Dr KLUGMAN —Exactly, one after the other. The only advantage of asking for a second opinion is that only one of the organs will be removed immediately. We can look at some examples of unnecessary surgery. I have the most recent example from the Sydney Morning Herald of 10 January 1983, which gives figures which compare rates of elective surgery in different areas in New South Wales. One gets fantastic variations. We know already that for the whole of Australia surgery rates are much greater than they are for most comparable countries. I come back to the gall bladder operation, the cholecystectomy. Generally medical students are told that the most common candidate for cholecystectomy is a woman who is fat, fair, fecund and forty. Apparently those kinds of people predominate in the Wollongong area of New South Wales. There is a huge difference between cholecystectomy rates in Wollongong and in other areas. In the Wollongong area it is four times the rate of some other areas in New South Wales. It would be interesting to see whether the congregation of people needing such surgery is so much greater in the Wollongong area. Let us look at the figures for the United States of America and compare the situation of people who have private insurance, Blue Cross insurance, where a doctor is paid on a fee for service basis, with that of patients who are insured with a health maintenance organisation, where a doctor does not get paid on that basis. If one compares similar patients of similar ages, similar backgrounds, similar occupations and similar medical histories one gets a factor of 3 and 3.4 for such operations as hysterectomies and back operations. One gets huge differences which can only be explained by the doctor's attempt, conscious or otherwise, to get more money by performing certain operations where he is paid on a fee for service basis. We have had debates on this matter before. I think the honourable member for Gwydir (Mr Hunt) and the honourable member for Warringah, also is at the table-I am sure this would have included the shadow Minister for Health had he stayed long enough as Minister for Health-accepted many of my propositions which they probably did not accept when they first took on the job of Minister for Health. I see they are nodding. The medical profession is no different from other professions in trying to increase its income. That applies also to lawyers. I am sure the people who are performing before or as royal commissions on a daily fee basis are not particularly keen to finish off the job terribly quickly. I have not heard from Mr Costigan that he wants to stop his inquiry. I do not think that we will hear that for some considerable time, judging from the rate at which he is being paid. Let me deal with the Australian Medical Association, especially its New South Wales branch, which is a particularly reactionary body. I do not wish to give the Federal Branch the death kiss but its Secretary, Assistant Secretary and President seem to me to be reasonable people. They are rational people who take a reasonable approach. They support our proposal. The reason they support it, of course, is that it is in the interests of the medical profession and they see it that way. However, people in the New South Wales Branch of the AMA are what in other groups in society one would consider to be rednecks. Last week I received a letter from it in my capacity as a member of the profession, although I am not a member of the AMA. It sent a common letter dated 22 August to the medical profession in New South Wales. Apart from the fact that whoever drafted the letter cannot spell-- Mr Hunt —It would not be George Repin? Dr KLUGMAN —No, it would not; it is the New South Wales Branch. The letter is from somebody called Dr Godfrey Douglas. He spells health with a double 'l' and publicly 'publically'. Mr MacKellar —He must have been talking to Doug Everingham. Dr KLUGMAN —I do not think that the honourable member for Capricornia uses that form of spelling. Dr Godfrey Douglas puts 'greater' when it should be 'lesser' and 'to' when it should be 'too'. I come to the piece de resistance in the letter, which I think got some publicity yesterday in the newspapers. It reads: In view of the nature and objects of the fund-- This is a fund to fight Medicare- and the restriction on the use of monies received, we have been advised by the Deputy Commission of Taxation, that 'in the case of taxpayers deriving assessable income from engagement in the Medical Profession, the nexus between the contributions and the income-producing activities would be sufficient to establish entitlement to deductions in terms of Section 51 of the Income Tax Assessment Act'. Mr Godfrey has obviously had advice from Mr Mike Evans of the National Party in Queensland, who is Secretary of the Bjelke-Petersen Foundation. He told us that we could donate any amount of money to the Bjelke-Petersen Foundation and it would be called advertising. A letter from Sir somebody Sparkes, President of the Queensland National Party, informed potential donors that the Australian Taxation Office would not challenge anybody on whether he was getting value for money for his advertisements, that one could pay $10,000 for a single paragraph advertisement in the National Outlook, the Queensland National Party newspaper. There is an utter hypocrisy on the part of the New South Wales branch of the AMA and on the part of the Opposition, I am afraid to say, at this stage on gap insurance. They argue, and I accept the argument to some extent, that there has to be some payment by the patient so as to restrict unscrupulous patients and unscrupulous doctors from overusing medical services. The only way one can restrict that is by having some sort of patient moiety. In other words, the patient pays a very small amount, but nonetheless an amount, towards the cost so that at least he has an account rendered to him, which he has to pay. I know that many people on my side of the House disagree with that, but I think it would be a restraining influence. It is quite depressing to me that people on the other side of the House argue for gap insurance. The AMA, which has argued for a moiety all the time, is now putting up notices in waiting rooms attacking the Government for not allowing gap insurance. If one has gap insurance one has no patient moiety. The patient never knows how much it costs to deliver medical services. Mr Ian Robinson —Do you include pensioners in this? Dr KLUGMAN —No. Mr Ian Robinson —Why? Dr KLUGMAN —Because I just think there are certain people-- Mr Ian Robinson —They are the best watchdogs. Put them in too. Put everybody in. Mr DEPUTY SPEAKER(Hon. Les Johnson) —Order! I draw the attention of the honourable member for Cowper to the fact that there is only one debate and the honourable member for Prospect has the floor. Dr KLUGMAN —I wish to make a couple of final points. I have taken longer than I intended to, and I apologise for it. My view is that the subsidy for private beds is excessive. The cost of a private bed-I am now talking about a doctor of choice bed in a public hospital-is of the order of $220 or more a day. Yet we are subsidising the cost of that bed so that the patient has to insure himself for only $80 a day. We are subsidising that patient by some $140 to $160 a day. Therefore we are encouraging fee for service medicine in hospitals because we are making it easier for people to take out private health insurance. My view is that people should not take out any private health insurance at all on top of their entitlement under Medicare. Finally, I wish to support strongly the separate identification of the health levy on the tax statement. I think this should be done not only in relation to health but also in relation to social security. It should be done for all kinds of benefits. There is a quite ridiculous attitude in the Australian community, which does not relate tax expenditure to benefits obtained. The only way that can be done is if a significant proportion of the tax that one pays is clearly labelled and related to some benefit. I obviously have no time left to give honourable members my alternative, but I have given it on many, many occasions. I think I do to some extent agree with the proposition that people are motivated by money, and that includes the medical profession. It is just the same as any other group. To be efficient we must have something like the health maintenance organisation in the United States whereby, instead of it being in the doctor's interest to have unnecessary hospitalisation and unnecessary services, the doctor in fact is paying for the unnecessary services and surgery. That is the only way the problem can be overcome. As long as it is in the doctor's interest to do unnecessaary things, as long as it is not in the doctor's interest to have healthy patients, all the concentration on the part of the medical profession will be on treatment and on performing all kinds of services which are particularly well paid. Very little emphasis will be placed by the medical profession on preventive medicine. The only way one can really encourage doctors to go in for preventive medicine is by showing them that it is in their own financial interest to do so. Mr MacKELLAR(Warringah)(12.24) —We have just heard a typically idiosyncratic speech from the honourable member for Prospect (Dr Klugman). I always welcome listening to the speeches of the honourable member for Prospect because he does bring a flexible mind to bear on the problems which confront the Parliament. I would agree with a lot of what he says. He says that fee for service is bad in itself; I do not necessarily agree with him. He does admit that there should be some sort of restraint on the escalation of costs by the introduction of a patient moiety, and in that he agrees with the Opposition's point of view. He then treated us to a dissertation on the excesses of various surgical procedures in various parts of New South Wales. Of course, the Government's scheme does nothing in any way to combat this problem. I believe this has to be combated from within the profession itself. A very effective and thorough peer review system obviously would have some effect in this area. Of course the training of the medical graduates will have a great deal to do with solving this problem. Certainly-and I agree with the honourable member-in some areas it is a problem. But the Government's scheme-I point this out again-does nothing to correct that problem. The honourable member said-I think I heard him correctly- that the Federal Australian Medical Association agreed with the Medicare proposals. That, to my knowledge, is not correct. Dr Klugman —It has not criticised them. Mr MacKELLAR —It has criticised them in a low key way and the honourable member for Mackellar (Mr Carlton) pointed out exactly why. It was because the doctors have experienced the jack-boot of the present Minister for Health (Dr Blewett) and they are frightened of what can happen in the future. And quite rightly they have a degree of concern about that. The honourable member for Prospect did say that he believed there was an excess of private beds. If there is an excess of private beds now, let me assure the honourable member that the Government's scheme will certainly put an end to that, because if this scheme stays in operation for too long there will not be any private hospitals left. What we will have is an escalating and ever-increasing demand on the expensive public hospital beds and a diminution of the private hospital system much to the detriment of the people of Australia. The honourable member also mentioned-and I make some allusion to this-that he believed that we should be looking at things like health maintenance organisations. I agree that we should. The Opposition's position is that our scheme would maintain sufficient flexibility within the health provider services to allow health maintenance schemes to operate in Australia. Again, the monolithic scheme proposed by the Government does not allow this flexibility, this experimentation. It is a typically socialist, monolithic answer to a very difficult problem. Mr Saunderson —That is why it is so good. Mr MacKELLAR —That is why it is so good. It is a typically socialist, monolithic , bureaucratic-ridden scheme; ipso facto it is good. What a typical response. In the introduction of this Bill, we see the absolute cornerstone of socialist thinking in this country. I would not be as unhappy about it as I am if I could see in it any benefits in health care to the people of Australia. This scheme simply brings about no increase in the quality of health care to the people of Australia. It simply does not. In fact, over the longer term, it will lead to a diminution of the very high standard and quality of health care available in Australia at present. If honourable members disagree with that assertion, they should ask the people of England or the people of Canada. The Canadians are luckier than the people of England. They can go south of the border to get high quality health care. If we introduce this scheme, in my view and in the view of a whole host of other people, in the longer term the general high quality of health care in Australia will diminish. We see an almost manic obsession on the part of the Australian Labor Party to re-introduce Medibank-or Medicare as it is called now-in this country. Obviously it is a matter of great concern to the coalition and to a very large percentage of the population, because we all remember the cost explosions, the unnecessary operations and the greed associated with the open-ended system introduced originally by the Whitlam Government and called Medibank, now to be introduced again and called Medicare. It took the coalition many years to pull back the costs of health care caused by the spending during those Whitlam years. I do not believe there is any denying that apart from the name change to Medicare, this is really Medibank Mark II. The Minister for Health admitted this in his second reading speech when he said: The task facing the Hawke Government is thus much the same as that faced by the Whitlam Government, and I am proud that our solutions are much the same. The Minister is proud that his solutions are much the same. What sort of answer is this for the health care system if the Minister intends to use the example- and a very poor example it is, I believe-of Medibank as the scheme that is best for Australia? It is obvious, as the honourable member for Mackellar has pointed out, that this Government has learned nothing from its past mistakes. In fact, it has wheeled out the same tired academic crocks from the Medibank days and told them to implement a universal scheme which it is to call Medicare. Has the thinking of those advisers changed from the Medibank days? Not a bit. They have just been waiting for another chance to take their ideological dream of nationalisation of the health system one step further. Since coming to power a little over six months ago the Labor Government has been fundamentally dishonest in its approach to the taxing of all Australians. It has indexed excises and increased sales tax. That slug will now come every six months. The Government has ceased the rebate on health insurance, breaking its concrete promise-of course we are used to the breaking of promises by the Hawke Government-and has thereby increased the financial burden on many Australians. Next February we can all look forward to a new tax being introduced to pay for Medicare. Call it by any other name, it is just a new tax. Considering the number of tax increases that have occurred under this Government , one wonders when the wealth tax that the Prime Minister (Mr Hawke) has already talked about will be introduced. Mr Chynoweth —Wait for it. Mr MacKELLAR —'Wait for it', the honourable member said. I am glad that he has now acknowledged that the wealth tax is in the pipeline. Perhaps he can tell us when it will be introduced. I am glad he has acknowledged that we have a wealth tax coming up as well as all those other tax increases. When the Australian Labor Party unveiled the Hayden health plan in February last year I described the scheme as misleading. I also stated that the estimates of cost were so inaccurate that it was best described as an attempted confidence trick on the Australian people. On the figures available to me in March of last year it was shown quite clearly that if the Labor Party were genuinely to use an income tax levy to recover the real cost of the scheme, that levy would have to be set as high as 1.2 per cent. 'Not a bit of it', says the present Minister. He said at that stage that it would be 0.75 per cent. He said: 'We will not need any more than 0.75 per cent'. The figure is up to one per cent already. Where will it go from there? As the honourable member for Mackellar pointed out, even that disguises in a very misleading way the real cost of health care in this country. Any shortfall in the cost of Medicare will lead to higher taxation. We will all be worse off. If the costing is wrong the only way in which that shortfall can be made up is by the provision of less health care or by the raising of more taxes from the people of Australia. If this occurs and more and more money is poured into the system we will be in the same position as in the Medibank days when the schedule benefits were paid exclusively by a government agency funded by taxpayers. That is exactly what the new scheme will do. I will mention some of the aspects of the introduction of Medibank mark I. That saw a great change in the proportion of health expenditures borne by the public sector. That proportion rose from 62 per cent in 1974-75 to 72 per cent in 1975- 76, and the Federal Government bore the largest share of 48 per cent. National health expenditure accounted for less than 6 per cent of gross national product in 1973-74 but it jumped to 7.7 per cent by 1975-76. Commonwealth Government outlays on health services jumped from 7.7 per cent of total Budget outlays in1973-74 to 13.5 per cent in 1975-76. It was a time when the Labor Government kept pouring in money and complaining vigorously about the inflation that resulted. I think it is utterly plain to everyone that the escalating costs of the introduction of Medibank were absolutely beyond the imagination of the people who introduced the scheme and were certainly beyond the capacity of this country to pay in the longer term. As I have said, if this blowout occurs again it is obvious that either the levy will have to be increased or Consolidated Revenue will have to be used to prop up the scheme. Let us look further at what happened with Medibank I. In 1973-74 56.62 million medical services were carried out. In 1974-75 the number was 64.03 million, an increase of 13.1 per cent over the previous year. In 1975-76, the first year of Medibank, there were 82.26 million services, an increase of 28.5 per cent over the previous year. That is the effect of introducing a scheme such as Medibank. I believe, as the honourable member for Mackellar has already pointed out, that the reintroduction of the Medibank system will lead once again to the over- utilisation of medical services and to more provision of services by the medical profession than is necessary. That can be combated in various ways, as the honourable member for Mackellar pointed out, but none of them will lead to effective and efficient health care services. The defect of the previous system and, by all appearances, this system, was the temptation which it provided to those concerned with the provision of health care to overservice patients and thus generate higher costs which inevitably must be borne by the taxpayer. The position is further aggravated when universal cover is provided by a single tax-financed government agency which in effect becomes the dominant source of income for doctors in private practice. Another problem which comes to mind in the introduction of Medibank is the desire of the Labor Party to number everybody by issuing them with a card. Mr Deputy Speaker, I am sure you will recall the introduction of Medibank Mark I and the farcical nature of the introduction of the Medibank cards. Cards were issued to people who had been dead for many years and to people's pets. Cards were misused by overseas relatives of Australian residents who came to this country solely for the purpose of having expensive operations, and of course the cost of that misuse was borne by the taxpayer. I note with interest that this rather generous attitude to visitors to Australia has been carried over by the present Labor Government. It seems rather generous to me that visitors who have approval to stay in this country for six months should receive the benefits provided by the tax of permanent residents of this country. I recall the influx of people into Great Britain from other European countries simply to take advantage of the free health care which was available there. Dr Charlesworth —Ha, ha! Mr MacKELLAR —The honourable member for Perth laughs about it. The fact is that it occurred. People from overseas added to the queues of those seeking to use the services that were available in Great Britain. It was no cause for laughter on the part of those people who were disadvantaged by it. Dr Charlesworth —You are suggesting it is going to happen here. Mr MacKELLAR —I am suggesting it should not happen here and that it could happen here with the Government's introduction of this scheme. The fundamental aim of the coalition was to ensure that all Australians had proper access to health services of high quality at a cost which the individual and the community could afford. Our other objectives were: A pluralist approach to health care delivery; preservation of freedom of choice by both providers and users of health care; small government; acceptance by the State governments of their proper role in planning for and providing efficient and economic health care services; encouragement of responsible use by payment of a personal moiety; protection of the needy; encouragement of the private sector; and the fostering of a sense of responsibility among the providers of health care. These objectives are what the coalition stood for when it introduced its health scheme in 1981. I believe that it was a successful scheme. Obviously, as the honourable member for Mackellar pointed out, there were some defects but they could quite easily have been remedied. It was a scheme which was acceptable to the public of Australia and which the Labor Government now intends to dismantle. We should ask: What does the Labor Party stand for and, in particular, where does it stand in relation to the health care of Australians? We know that the Labor Party stands for big government. It obviously stands for higher and higher taxes. It stands for a denial of choice and a distortion of Commonwealth and State priorities. When it comes to health care Labor stands for universal, compulsory centralised, monopolistic government schemes. The danger of centralised government agencies is that they can be impersonal and insensitive to the needs of individuals. I am concerned at the possible unemployment in the voluntary health insurance area, and I am pleased that the Minister has seen fit to give employment preference to employees of the private health funds who seek employment with Medicare and who are affected by the introduction of the new program. It is an empty promise but, nevertheless, he made it. I trust that some of his compassion in this matter will rub off on his Government agency when it comes time to handle the health problems of the community. Another area where I must also congratulate the Minister is his decision not to revert to the open-ended hospital cost sharing arrangements which were in vogue during the Whitlam Medibank era. I note that the Minister said: The Government believes that the States should have the major role in planning the total health services available in the community. The coalition is firmly of the belief that the States should fully accept their constitutional responsibility for the provision of health services and determine their own priorities as to how funds should be allocated to the different parts of the health system. Yet, for all the Minister's words, I can see nothing in his second reading speech which guarantees that health care decisions will not be brought back to the bureaucrats in Canberra as they were during the Whitlam years. The Minister pointed out the benefits of Medicare to the States and he singled out for special attention the State of Queensland. I wonder why he mentioned Queensland? Perhaps it is because there is an election in Queensland on which he thinks he may have some influence. He said: . . . Queensland is the only State Government which has its overall health funding situation improved by Medicare. That, of course, is an absolute nonsense. The original offer made to Queensland was $63m and its population is 2.45 million. In South Australia, where the population is 1.33 million, the offer was $78.7m and in Western Australia, with a population of 1.35 million, the offer was $69.9m. Of course an extra $35m has been found for Queensland since the original offer. But on a population basis the original offer was nowhere near a fair one. One could perhaps question the motives behind the highest increased outlay of $20m to Western Australia now that that State is controlled by Labor. The one per cent levy in Queensland will provide residents of that State only with access to a private medical practitioner as hospital treatment is already provided free through the State's own tax system. Queenslanders will now find that the one per cent levy would be more than they had previously paid for health insurance to cover themselves for visits to the doctor. Rather than being better off, they are worse off. With the coalition's tax rebate on health cover which, as I mentioned earlier, was ceased by the Government on 1 July, single persons could have taken out a health insurance policy for $1.75 each week to cover themselves for visits to the doctor. Under the Medicare levy they will pay a minimum of $2.50 per week. Not even the mathematical gymnastics of the Minister will convince Queenslanders that they are better off paying more. Obviously married couples who are both working will be hit hardest because they will pay the levy twice. This will cause additional hardship to young couples saving for their first home amongst other things. The current Minister for Health, when he was in Opposition, took great delight in knocking our health program, saying that it was confusing. I do not believe that it is anywhere near as confusing as the particular proposition that has now come before us. The Labor Party has had seven years to work on a policy. The present policy was announced over 19 months ago. But, after six months in government, the Labor Party is still not in a position fully to explain to the people of Australia what it all means. I believe that the public are confused. A number of people are fairly concerned about what will happen to their freedom of choice, what will happen in terms of the delays they may experience and what will happen in the general provision of the wide variety of health care services currently available to Australians. It is clear that this scheme, which is a gross deception, will put a grave strain on public hospital services, leading inevitably to queues and delays. It will be a major burden on the nation's economy and will grow substantially in cost year by year, unless services and facilities are curtailed, and it will inevitably lead to higher taxation. The Minister has described his scheme as ' simple, fair and affordable'. It obviously is nothing of the sort. Like so many of the Labor Government's statements and policies, it breaks promises. Its performance will in no way live up to its description when it was put to the Australian people before the last election. Debate interrupted. Sitting suspended from 12.45 to 2 p.m. Mr GOODLUCK —I direct my question to the Prime Minister. Did the Prime Minister say during the election campaign that the price of petrol in Australia would be reduced by 2c a litre? Is the Prime Minister aware that in Tasmania the price of super grade petrol is 52c a litre and the price of liquefied petroleum gas is 33c a litre when, in fact, in Albury-half way between Melbourne and Sydney-super grade petrol is 46c a litre and LPG is 23c a litre? I would like an explanation if we are going to reconcile the problems of Australia and try to bring Australians together. Mr HAWKE —I am very much aware of what is happening in Tasmania. It seems that I am more aware of the attitudes and the feeling of the people of Tasmania than is the honourable member. I certainly would never find myself in a position where I would express myself as being ashamed to be a Tasmanian. Mr Goodluck —Mr Speaker, I raise a point of order. I would like the question answered, not a direction at me. Mr SPEAKER —Order! Mr Goodluck —The Prime Minister is debating Australia's- Mr SPEAKER —Order! I warn the honourable member for Franklin. Mr Goodluck —Get him to answer the question. Mr SPEAKER —I warn the honourable member. He knows what that means. Mr Goodluck —No one says that I am not a Tasmanian. Mr SPEAKER —I name the honourable member for Franklin. Mr Lionel Bowen —I move: That the honourable member for Franklin be suspended from the service of the House. Mr Sinclair —Mr Speaker, I suggest that the honourable member might be prepared to reconsider the remarks in the circumstances and perhaps accept the suggestion you put to him. Mr SPEAKER —The Deputy Leader of the National Party makes a plea on behalf of the honourable member for Franklin. There is a difficulty if one always accepts that plea, in that it affects the sanction that a warning and naming applies. However, having given that warning that an apology will not be accepted subsequently, if the honourable member for Franklin cares to apologise to the House for breaching the Standing Orders I will ask the Leader of the House to withdraw the motion. Mr Goodluck —Mr Speaker, I have never back-tracked in my life, but you are a gentleman and in deference to the Chair-- Government members interjecting- Mr Goodluck —If it meant giving way to the- Mr SPEAKER —Order! The honourable member has been given the opportunity to apologise to the House, not to me. He has broken the Standing Orders of the House. Mr Goodluck —To you, Mr Speaker, I apologise. Mr SPEAKER —Perhaps the motion could be withdrawn. Motion-by leave-withdrawn Mr Lionel Bowen —In the circumstances, in view of the naivete of the honourable member, I withdraw the motion. Mr HAWKE —In respect of the price of petrol, we indicated that certain results would flow from the decision that we would take and we took that decision. In the period since then other decisions have been taken, both by the Government and in the commercial field, which have had effects upon the price of petrol and other sources of energy. In respect of the decisions that this Government took in the Budget-which had its impact in that area-I simply indicate that, if the honourable member wants a judgment about what people think of the Budget, he should look at today's Bulletin, in which it is recorded that for the whole period since the poll has been taken on the reaction of people to the Budget there is a more favourable reaction by the Australian people to this Budget than to any other Budget ever before. Mr CUNNINGHAM —I refer the Treasurer to the many statements by the Leader of the Opposition that the Opposition would repeal the proposed assets test of the Government upon the coalition's return to government. I ask the Treasurer whether he is aware of the extent of support within the coalition for this proposed course of action. Mr KEATING —I suggest that it will be a long time before the Leader of the Opposition will be in a position to repeal anything in this Parliament. Be that as it may, yesterday we were treated to a very curious proposition from the Leader of the Opposition. On a matter of public importance where he was fulminating about the Government's policies in respect of the elderly, saying that the Government had abandoned the elderly. Other disparaging adjectives were thrown into his address. Obviously these views are not shared broadly within his own Party or indeed within the coalition parties. The Leader of the National Party, Mr Anthony, in a letter to Senator Grimes about the assets test on those over 70 to ascertain their eligibility for a pension, a matter to which the Leader referred yesterday, had this to say: Although I have explained that, for the majority of pensioners, the reintroduction of an assets test should not have any harmful effects, I said I would bring his views to your notice as he requested. I find this in sharp contrast to the views being put by the Leader of the Opposition yesterday. One wonders just how broadly the opportunist view put by the Leader yesterday is shared within the coalition parties. I note, in passing, that Senator Chaney in the past expressed views about the reimposition of an assets test. I also note that the Deputy Leader of the Liberal Party was not in the party room the other day when this matter was discussed. He took the opportunity not to second the proposition or move the proposition which was proposed yesterday. So one wonders just how broadly the support within the coalition parties for this opportunist view happens to be. Let me reiterate the fact that the Government believes that in this area of income support for people in retirement there has to be a basis of Commonwealth funding where a need exists. There has been a massive circumvention of the income test in respect of people in receipt of social security pensions. I indicated yesterday how generous the assets test on the pension would be and the fact that the Government will be giving broad consideration to the issue upon taking advice from interested organisations and pensioner groups. But it is very interesting just to note, once again, the divergence of view of the coalition between the Leader of the National Party and the Leader of the Opposition about the severity of the Government's assets test on the over-70s. Mr MacKELLAR —I refer the Minister for Immigration and Ethnic Affairs to an article in today's Bulletin with reference to a visit of a delegation of 11 Libyans to Australia. I ask the Minister: Is the leader of the delegation a Mr Ahmed Shuhati? Was Mr Shuhati formerly director of the Libyan Foreign Liaison Office, a key element in Libya's intelligence network, which has a particularly violent record and has conducted terrorist operations? Did the Minister personally approve the entry of Mr Shuhati and his delegation? Has he, or any other Minister, met with the delegation? Mr WEST —The Government's policy on visitor entry is that, if there is no perceived threat of terrorism, no perceived threat to the security of Australia, no perceived threat of public disorder, and unless there is some matter of particular concern to the Department of Foreign Affairs and to the Government, we should not, on political grounds, debar visitors from entering Australia. Mr MacKellar —Did you get advice from Foreign Affairs? Mr WEST —If the honourable member will just listen he will get the answer. I point out that it is true that at present 11 members of the Libyan delegation are in Australia. I have consulted with the Department of Immigration and Ethnic Affairs. To the best of my knowledge no objection has been put to me as to why they should not be allowed into Australia. They have been processed in the normal way. I had a prior look at their suggested agenda. I noted that some members of the Federal Opposition were listed on the agenda to meet the delegation. In fact, it is no accident that the shadow Minister for Immigration and Ethnic Affairs did not ask this question. He does not agree with the honourable member for Warringah. I noted that a number of State government and State administration people were on the agenda to meet the delegation and that various important people in public life in Australia were to meet them. Their agenda involved visiting prominent Australian universities and agricultural areas. I knew that the previous Government, I think on three occasions, had allowed delegations from Libya to come here. Mr MacKellar —What about the composition of the delegation? Mr WEST —The previous Government allowed three delegations to come here, in the past. Mr MacKellar —I am talking about Mr Shuhati. Mr WEST —With regard to Mr Ashahati, the Department had not put any reason to me , nor had the Australian Security Intelligence Organisation, why he should be kept out of Australia. Mr MacKellar —You asked ASIO, did you? Mr WEST —That is the answer to the honourable member's question. I received nothing from them to say that he should be kept out of Australia. Mr MacKellar —Did you ask them? Mr SPEAKER —Order! The honourable member for Warringah since he sat down has asked a series of questions by way of interjection. I suggest that he should cease interjecting and listen. Mr WEST —This Government allows, as did the previous Government, a bureau representing the Government of Libya to remain in Canberra, although we do not have a post in Tripoli. The Libyan People's Bureau had been here under the previous Government for a long time. I add that there is significant trade-$100m Australia's way-with Libya. That is to our advantage. In conclusion, I suggest that the Opposition, instead of taking its cue from journalists who write for the Bulletin or various other newspapers in Australia, in the future act in a manner which is in accord with the best interests of our international relations . Mr SIMMONS —Is the Minister for Territories and Local Government aware of continuing statements by local government bodies throughout Australia, claiming that while the consumer price index moved by 11.2 per cent in 1982-83 personal income tax collections, which act as a criterion for revenue sharing grants to local government, increased by 8.2 per cent? Can the Minister assure the House that local government will continue to receive sufficient financial support in recognition of its status in the three tiers of government in Australia? Mr UREN —Last year $424m was made available to local government under the income tax sharing arrangements. This year approximately $460m will be made available. That figure represents 2 per cent of last year's income tax receipts. The Cabinet assessed that an 8.2 per cent increase in funds this year would provide a slight real increase over the projected increase of 7.5 per cent in prices during the year. As Minister for Territories and Local Government I examined, together with my colleagues, the moneys to be made available to local government by this Government in this financial year. Last year the former Government made available to local government a total of $687m. This year the amount will be some $994m, an increase of about $300m made available to local government by me and my colleagues. That is an increase this year in the order of 45 per cent. The Government's commitment does not stop there. This Government, with its commitment to local government, for the first time in history has set up a department responsible specifically for local government. I inform honourable members that when I became Minister for Territories and Local Government four bureaucrats looked after the Federal Government's responsibility for local government. This Government set up the Department of Territories and Local Government. It recognised local government at the National Economic Summit Conference; it recognised local government as a member of the Economic Planning Advisory Council. It has moved towards a constitutional recognition of local government and a sub-committee of the Australian Constitutional Convention has been set up to review the role of local government within the Constitution. So this Government has a broad commitment to local government, and has increased substantially the finance available to it. We believe that the only way in which social problems in city and rural areas can be solved is by a real spirit of co- operation between Federal, State and local governments. Mr HUNT —Has the Special Minister of State seen in the media criticism of the recommendations of the Joint Select Committee on Electoral Reform for an enlarged parliament on the ground that we already have a high number of politicians per capita in Australia? Is it fair to compare the United States of America and the United Kingdom with Australia, in view of the much greater powers and responsibilities of local authorities in those countries? Does the Minister agree that the Committee's proposal for a modest increase in the number of House of Representatives electorates is consistent with the Government's one vote one value policy? Mr BEAZLEY —I preface my answer by congratulating the honourable member and all the others who served on the Committee for producing what will be in the history of democratic practice in this country a seminal work, an extraordinarily successful tour of the entire electoral map in all its aspects in this country, and one which will be of very considerable assistance to this Government and the Parliament. I have seen some of the reports to which the honourable gentleman referred, and I will refer first to the last part of his question. An increase or otherwise in the size of the Parliament would have absolutely no impact one way or another on the question of one vote one value legislation. It would be perfectly consistent with it and there would be no problem in that regard. I have also seen the reports with regard to whether the proposition that has come forward is appropriate. I take this occasion to refer to a number of figures in order to look at this matter on a comparative basis. In the case of the United Kingdom, 650 representatives have an average of 65,692 electors in their constituencies. Canada's Parliament, which has 282 representatives in the lower House-I am looking at equivalents, as the honourable member's remarks were directed towards the House of Representatives-has an average number of voters per constituency of 56,349. In New Zealand, with 92 representatives, the average number per constituency is 22,117. In Australia, with 125 representatives, the average is 74,989. So in each of those instances Australia comes out well ahead. Indeed, were we to implement the suggestions put forward by the Committee, all that would happen is that we would come in a couple of thousand below the British average instead of being 9,000 above it, as we are now. It is quite understandable why the Committee would put forward those propositions. Since the Parliament was restructured in 1949 the size of the average House of Representatives constituency has almost doubled from about 39, 900 to 74,000-plus. As the Committee pointed out, in that period there has been about a 70 per cent increase in the size of the Ministry. The increase in responsibilities assigned to individual members of parliament since that point has been almost geometric and there is considerable pressure, well supported on both sides of the House, for the creation of effective committee systems. When I was in the United Kingdom recently I noted that since 1979 the United Kingdom House of Commons has set up a committee system which effectively shadows every department of state, which, given the current size of the Parliament, we would not have the numbers to do. I am convinced on that matter, as I am on most of the matters in the Committee' s report, that the bases on which the Committee arrived at its decisions have been balanced, sensible, well motivated and in the interests of better democratic practice in this country. As I said yesterday when comment on the matter was invited from me by representatives of the Press, all items in the Committee's report, including that one, will subsequently need to be the subject of government decision and the introduction of legislation in the House. So, my comments here are made without prejudice, but I am satisfied with the basis on which the Committee arrived at that decision. I conclude by again congratulating the members of the Committee on the very deliberate and sensible way in which they went about their business. Mr MOUNTFORD —My question, which is directed to the Minister for Finance, concerns criticisms by the Auditor-General of the escalation in the cost of construction of HMAS Success. Can the Minister confirm the increase in the cost of HMAS Success? Can he say how this cost overrun has occurred? Can he indicate what steps the Government intends to take to ensure that such an overrun does not occur again? Mr DAWKINS —It is true that the Auditor-General commented unfavourably on the HMAS Success project which, I might say, is a ship with a rather inappropriate name considering its appalling record. One paragraph within the Auditor-General' s report says: Latest estimates indicate the ship will be completed approximately three years later than previously provided for in the 1979 ship construction contract. In six years, the approved project costs have increased by $114.1m to $187.3m. Audit is unable to state with certainty the extent of the real cost increases. Obviously the project tender price was $88m. It has increased, as the Auditor- General reports, by over $100m, a very substantial part of which is a real cost overrun. The Auditor-General was very critical of a number of aspects of this project, but it is worth pointing out that almost all the criticisms which the Auditor-General made were predictable and in fact predicted by Defence and Navy at the time this contract was considered. The real problem is that this Government inherited from its predecessors a contract the cost overrun and management of which were entirely out of control. I think the point has to be made that the real criticism for this position and the way in which this was handled should be sheeted home to the people who preceded us, particularly the former Prime Minister and his former Defence Ministers-the former member for Moreton and the current Deputy Leader of the National Party. I suppose that, given the latter's record, it is not surprising that he was less than scrupulous in the handling of other people's money. It is an appalling example of the way in which the former Government ignored the very sensible advice which it received at the time this project was considered. Mr Howard —Mr Speaker, I take a point of order. The remark made by the Minister for Finance is not only dishonest but also unparliamentary. I ask that the imputation against my colleague the Deputy Leader of the National Party be withdrawn. Mr SPEAKER —The point having been taken, I ask the Minister to withdraw. Mr DAWKINS —Well, I withdraw. I will leave the House and the nation to make their own judgments. Mr Shipton —Withdraw. Mr DAWKINS —I have. The point is that this is an appalling example of the way in which these kinds of projects can get out of hand when decisions are made by governments for purely political reasons, either to advantage their own friends or for other political purposes. In taking decisions about these kinds of matters, given that these construction projects involving particularly military equipment and ships are extraordinarily complex, governments have to take into account the consequences of the decisions they take. I can assure the House that this Government is trying to ensure that from now on the cost in relation to this project is kept at the lowest possible level, although one cannot be sure that the overrun will not continue, given the circumstances we inherited. We will certainly keep in mind this experience when dealing with similar contracts in the future. Mr Sinclair —Mr Speaker, I ask the honourable gentleman to table the paper from which he has been reading. Mr SPEAKER —Was the honourable gentleman reading from a document on public affairs? Mr Dawkins —It is the Auditor-General's report. You are welcome to it. Mr SPEAKER —The Auditor-General's report is tabled. Mr Sinclair —And the paper from which he was reading. Mr SPEAKER —The Deputy Leader of the National Party asks whether the paper with the report was a document on public affairs. Mr Dawkins —I was not quoting from anything other than-- Mr Sinclair —Just reading from it. Mr Dawkins —I was not even reading from it. Mr WHITE —I ask the Minister for Defence: In view of the Government's recent announcements concerning a review of the Defence Force retirement and death benefits scheme and the subsequent concern those announcements have caused, when is the actuarial report likely to be received by him and when is the review of that scheme likely to be completed? Mr SCHOLES —I thank the honourable member for his question. The actuarial report is not likely to be available until the middle of next year. It will be probably eight to nine months before that report is made. Any review would take place subsequent to that event. So any serving members of the Services who are concerned about any immediate changes or any changes in retrospect can be assured that no changes will take place until that report has been received. At this stage there is no consideration in anticipation of that report. I think I can also say that no benefits which have been accrued by Service persons will be affected by any decisions which may be made in the future. Mr Sinclair —What about the tax? Mr SCHOLES —The Deputy Leader of the National Party apparently is not aware that the major aspect of the decision on tax was that it would not have retrospective application. There have been attempts to undermine the confidence of some people in this respect. The facts are that no person's entitlements at the time of that announcement have been changed. Any member of the Services who may be affected by tax-and that decision has not been made-will not pay tax on any element of his Service pension accrued prior to the date of the announcement of the changes in the taxation of lump sum superannuation. It is a forward application. It has no retrospective effect. I also assure the House that any changes which took place in the DFRDB scheme as a result of a review would not be made retrospective but would apply from the time of the passage of the legislation through this House. Mrs DARLING —I ask the Prime Minister: Has the Federal Government made sufficient progress in implementing the prices and incomes accord to reasonably expect all trade unions party to the accord to confine their wage claims to national wage case rises, as required under the accord? Mr HAWKE —I am indebted to the honourable member for her question because it is perhaps the most important question that can be asked at this time. The prices and incomes accord, as I have had reason to explain to the House on a number of occasions, provides the Government with an instrument in addition to those blunt and indiscretionary economic instruments of fiscal and monetary policy. Indeed, its existence enables the Government to undertake with a greater degree of confidence a stimulatory economic program to try to get this economy going again . It is for that reason that we on this side of the House-and I hope very many on the other side of the House-welcome the fact that yesterday the Australian Council of Trade Unions Congress, the supreme parliament of the trade union movement, unanimously supported that prices and incomes accord. An accord by definition means that there are obligations on the two sides to the accord. Let me very briefly explain that we on this side, as the Government, while making it clear that we could not expect to deliver every element of the accord in a very short time, nevertheless in six months have done a great deal to deliver our side of the accord. We have helped to move back to a centralised system of wage fixation. We have made submissions to the national wage case in respect of a system of wage indexation. We have taken very important action in the sphere of non-wage income. I have personally written to a very large number of major companies in this country and asked that in respect of dividends, directors' fees and other emoluments they exercise restraint in accordance with the principles of the accord. I pay tribute to those companies. Overwhelmingly they have responded positively to that approach from the Government. My colleague the Minister for Employment and Industrial Relations has approached professional associations. Where they are under no formalised fee fixing mechanism, he has suggested that they avail themselves of the services of the Australian Conciliation and Arbitration Commission so that those fees can also be fixed in accordance with the principles of the accord. In addition to that, we have established the Economic Planning Advisory Council . Again, let me pay tribute not merely to the trade unions but also to the business community of Australia, large and small, the State governments, local government and other organisations which have joined with the Government in establishing that central part of the accord. We have also moved-and the legislation will be introduced shortly-to establish the Prices Surveillance Authority. My colleague the Minister for Health has, of course, done a marvellous job in getting Medicare ready. That will be operative early next year . We have introduced the community employment program. I make the point therefore that on the Government's side of the accord the Government has delivered the goods. It follows from that that it is now up to the ACTU to play its part. We have delivered our side. As I said to the ACTU Congress directly on Monday this week, there cannot now be any sectional wage claims under the accord. Unions have to abide by the decision in the national wage case. Only in the most special and extraordinary circumstances ratified by the Commission itself could there be any sectional claims outside the decision in the national wage case. It is the firm view of this Government that any union which is not prepared to sign on the line and say 'We accept this decision and we will not be making sectional claims' is not entitled to any increase under the national wage case. We on this side of the House believe that the trade union movement shares with us a real commitment to the prices and incomes accord . We expect the ACTU and the unions to deliver and we believe that they will. Mr Sinclair —Mr Speaker, I take a point of order. Under standing order 321 I again ask that the Prime Minister table the notes from which he was reading. Mr SPEAKER —The request for tabling can only be for a document on public affairs . The Standing Orders do not refer to notes. Was the Prime Minister quoting from a document on public affairs? Mr Hawke —No, I had notes. Mr SPEAKER —There is no point of order. Mr PEACOCK —I draw the attention of the Minister for Trade to comments made earlier this week by the Foreign Minister on the need to take a more enlightened view of trade and protection policy. Does the Minister agree with the Foreign Minister's interpretation of Australia's trade and protection policies or does he agree with the Minister for Industry and Commerce, who said yesterday that the Foreign Minister's views were 'coloured by the Minister's frequent visits to South East Asia'? If he does agree with the Foreign Minister, what has been the reaction of our regional partners to this important change in trade policies? Mr LIONEL BOWEN —In matters of trade I am responsible; in matters of foreign policy the Minister for Foreign Affairs is responsible; and matters of economics belong to the Treasurer. Last evening I had the opportunity to talk to an Association of South East Asian Nations group. Mr Peacock —So Bill was irresponsible. Mr LIONEL BOWEN —I make the point very clearly that if we followed the policies of the honourable member for Kooyong on protection we would wind up where he is now-and he is one of the best free traders in the business. He has been asking questions in this House on why we want to be so protective. Formaldehyde preserves only the dead. He ought to remember that. However, we agree to disagree on a few minor matters-not matters such as this though. This matter is very important from the point of view of our ASEAN friends. Last evening I was able to enlighten them to the fact that, when one looks at Australia's protection policies and then at all the non-tariff mechanisms that are used by other countries, one finds that Australia is one of the least protective countries. For example, a recent report of the United Nations Conference on Trade and Development, which the honourable member might not have had a chance to read, clearly indicated that there were at least 21,000 instances, across some 2,000 non-tariff mechanisms being used in respect of 42 countries that were analysed. My own Department has also identified some 2,000 instances of non-tariff mechanisms being used by other countries. So it is time we all got up to date, forgot about the tariff and looked at the question of non -tariff mechanisms. If honourable members do that they will find that in respect of our trade with ASEAN countries-I am speaking from memory-Australia imports $26 worth of manufactures per head. That is well in excess of Japan, at $11, and the United States of America, at $23, and far in excess of the European Economic Community, at $12. In other words, Australia gets the gold medal in regard to import penetration. It is about time everybody in this House had a look at what the manufacturing industry has been able to do for Australia. I recognise, of course, that it needs to be restructured. But it should also be remembered that Australia is one of the few countries which take migrants. When migrants come into a country their only chance of employment is in the manufacturing base. That ought to be recognised. It is about time we told all those well meaning economic rationalists to have a look at some of the opportunities that can be provided for migrants and other people when there is a strong manufacturing base. I agree that there has to be a restructuring of manufacturing industry but it ought to be done on an intelligent basis. Of course it is much more important for us to be helping industry to restructure than to be paying unemployment benefit to the unemployed. Mr BLANCHARD —Is the Minister for Science and Technology in a position to announce the Government's decision on the Espie report on the provision of venture capital for the development of high technology industries? Mr BARRY JONES —I thank the honourable member for Moore. I am pleased to announce that I am in a position to answer his question. This morning Cabinet adopted a joint submission from the Minister for Industry and Commerce and me for the provision of tax incentives for private sector venture capital companies, as the Treasurer foreshadowed in his Budget Speech. The Cabinet decision follows the detailed proposals of the Report on Developing High Technology Enterprises for Australia prepared by the High Technology Financing Committee of the Australian Academy of Technological Sciences, chaired by Sir Frank Espie. Shareholders in management and investment companies-MICs-will be entitled to tax deductions at a rate of 100 per cent. Mr Hawke —Micks? Mr BARRY JONES —I do not want to be sectarian. The MICs will in effect be syndicates of investors with a wide range of portfolio investments in high technology companies, not just concentrating in one or two types of technology. It is hoped that the MICs will be geographically spread and not just concentrated in Sydney and Melbourne. A licensing board will be set up to administer and monitor the program and to grant licences to the MICs. The licensing board will be my responsibility, although I will work in close consultation with my old colleague and friend the Minister for Industry and Commerce, because of the enormous implications of the scheme for old and new industries. Mr Cadman —Mr Speaker, I raise a point of order. It has long been the practice of the House that Ministers can make statements following Question Time. I suggest that the Minister avail himself of that process. Mr SPEAKER —Order! There is no point of order. Mr BARRY JONES —This decision is an indication of the Government's commitment not only to sunrise industries but also to using modern technologies to revitalise our existing industrial base. The Minister for Industry and Commerce and I will hold a Press conference this afternoon to provide further details. We are at the beginning of a new industrial revolution for Australia. The Espie mechanism will be a great catalyst and the Commonwealth Scientific and Industrial Research Organisation will be working in it too. Mr HICKS —My question is directed to the Treasurer. Because of the chaos that the imposition of an excise on grape spirit announced in the August Budget will cause in the wine and dried fruit industries, particularly in the Riverina, Sunraysia and Riverland districts, and because of the obvious dissatisfaction of the Minister for Primary Industry with his Government's decision on this matter, will the Treasurer rescind the Government's decision to place an indexed excise of $2.50 a litre on grape spirit? Mr KEATING —The Government has, of course, received quite a number of submissions from the fortified wine industry about the effect upon the industry of an increase in excise on grape spirit. The Government is in the course of considering those submissions. At the appropriate moment I will respond to the industries and as necessary in the Parliament. Mr JACOBI —My question is directed to the Minister for Foreign Affairs. What is the latest situation in relation to the Australian Government's protest and our claim for compensation from the Soviet Union for its destruction of the Korean aircraft which led to the death of 269 people, including four Australians? Mr HAYDEN —Today the Cabinet met to consider this matter further. The latest intelligence assessments available from overseas sources and domestic ones were presented by the Minister for Defence and me. Beyond that we made a review of developments following this disaster. We agreed that the latest Soviet account of events still falls well short of Parliament's proper expectations of a full, truthful, prompt and appropriately regretful account from the Soviet Government. The Minister for Aviation and I outlined the prominent role Australia planned to play in advocating a firm but responsible and measured approach to the Korean Air Lines issue at an extraordinary meeting of the Council of the International Civil Aviation Organisation-ICAO-to be held in Montreal on 15 September, and subsequently at the ICAO Assembly from 20 September to 10 October. The Cabinet agreed that the Australian delegation should fully support the concept of a thorough and exhaustive inquiry into the disaster under the auspices of the Secretary-General of ICAO, and should also support initiatives to strengthen the security of international civil aviation. We examined Australia's relations with the Union of Soviet Socialist Republics in the civil aviation field, in common with many other governments which have been appalled by the Soviet Union's callous disregard of norms of behaviour relating to civilian aircraft. Recognising that our commercial associations with the Soviet company, Aeroflot, are limited, nonetheless we decided that the Government would suspend co-operation with Aeroflot pending a satisfactory response from the Soviet Government to the other requests which Australia had made to it. We approved the terms of the initial Australian approach claiming reparations from the Soviet Union. It was agreed that that claim should be presented to the Soviet Government through diplomatic channels today, and that was done. I table the document. Since the Cabinet meeting I have received advice from Mr Henderson, the Secretary to the Department of Foreign Affairs, that he personally handed the Soviet Ambassador a copy of the note and a copy of the parliamentary resolution which was supported unanimously by this Parliament last week. The Soviet Ambassador read them and responded along the familiar lines about the Soviet version of the facts. The Ambassador declined to accept the note or the resolution. Soviet authorities adopted this practice in a similar set of circumstances quite recently on the occasions when the Government of the United States of America and the Canadian Government sought to present notes to government representatives of the Soviet Union in their countries. Mr Henderson told the Soviet Ambassador that we clearly had a very different view of the facts from that which the Soviet authorities had expressed and which had been replicated by the Soviet Ambassador. However, Mr Henderson said that both he and the Ambassador agreed on one single fact, melancholy as it was-that the plane had been shot down by the Soviet Union. Australia therefore regarded itself as having a strong claim for reparations. Mr Henderson told the Soviet Ambassador that we did not accept that the plane was on a spying mission, or that the weather conditions were as described by the Soviet Union. Furthermore, he told the Ambassador that he could do no more now than report the Ambassador's response to me and to the Government. When Question Time is completed I will take the opportunity of consulting further with the Prime Minister on this matter. I should state for the sake of the record that the suspension of the commercial association with Aeroflot will be for a period of 60 days, or less should a suitable response come forth from the Soviet authorities. Mr LINDSAY(Herbert) —I seek leave to make a personal explanation. Mr SPEAKER —Does the honourable member claim to have been misrepresented? Mr LINDSAY —I do, Mr Speaker. Mr SPEAKER —The honourable member may proceed. Mr LINDSAY —Thank you, Mr Speaker. A misrepresentation occurred in the daily Hansard report of my speech during the adjournment debate last night. I referred to the Cardwell-by-the-Sea sub-branch of the Returned Services League. The daily Hansard shows me as having said: 'It does not have a great sense of service to Australia'. What I said was: 'It does have a great sense of service to Australia '. My statement was correctly reported by Hansard. A correct copy of the Hansard report was forwarded to the Government Printing Office where the error in typesetting took place. I find the misrepresentation by the Printing Office to be highly regrettable. Mr LIONEL BOWEN(Kingsford-Smith-Minister for Trade) —Pursuant to section 6 (2) of the Australian Science and Technology Council Act 1978, I present the annual report of the Australian Science and Technology Council for 1982-83. Mr KEATING(Blaxland-Treasurer) — Pursuant to section 37 (1) of the Petroleum Products Pricing Act 1981, I present the annual report of the Petroleum Products Pricing Authority for 1982-83. Mr PETER MORRIS(Shortland-Minister for Transport) —Pursuant to section 7 of the National Railway Network (Financial Assistance) Act 1979, I present a supplemental agreement between the Commonwealth and the State of Victoria in respect of projects by way of improvement of main railway lines in Victoria, together with a brief statement relating to the agreement. Mr UREN(Reid-Minister for Territories and Local Government) —Pursuant to section 5 of the Parliament Act 1974, I present the proposals for the construction of two standard bus shelters and one additional streetlight in King George Terrace, Parkes, together with a brief statement relating to the proposals. Mr LIONEL BOWEN(Kingsford-Smith-Leader of the House)(2.51) —by leave-I move: That Standing Order 48A, as amended by the Sessional Order of 24 August 1983, relating to the adjournment of the House, and standing order 103, the 11 o'clock rule, be suspended for this sitting. The reason for moving this motion relates to legislation before the House known as the Medicare legislation. It is legislation of some substance, and it is certainly contested. I am aware that the Opposition still has another 13 speakers who wish to participate in the debate, and we want to allow them to participate. That being so, it will be necessary to allow probably another seven hours of debate, or more. The Bills are certainly of national importance. The Government is anxious that they be passed without further delay. There has already been debate today of about one and three-quarter hours but, because of other matters still to come before the House by way of the business before the House, it seems to me to require at least the suspension of the 11 o'clock rule to enable all those listed to speak so to speak. That is why the Government is taking this unprecedented action. Mr SINCLAIR(New England)(2.53) —The Opposition does not resist the motion. Indeed, I am delighted to know that honourable members from both sides of the House will be given adequate time to discuss one of the more fundamental socialistic changes that this Government has, to date, introduced. In the process of nationalisation of medicine and hospitals that we see in Medicare, I am sure that most members of the Opposition would want the opportunity to address themselves to the package of Medicare Bills. However, it is worth commenting that this is the second week under the new sitting times of the House . They are obviously already proving totally unsatisfactory. I am delighted, too , to know that one of the reasons for the introduction of the measure is the recognition that those who serve us in this House-not only the people who sit at the head of the table, but also the parliamentary reporters-are to be given an adequate time in which to eat. The only thing that seems a little incredible is that it should be yet another different break for a meal time from that of the other sitting nights. I understand that from 6.30 p.m. to 7.30 p.m. is perhaps enough to meet industrial terms and conditions, but I should have thought that the Leader of the House (Mr Lionel Bowen) would have realised that most members about this House-even, I suspect, some of those of the Government-have commitments which they meet within this Australian Capital Territory community. I suggest to him that it might have been more suitable had we adjourned from 6.30 to 8 p.m., which is still half an hour less than the standard dinner break which we provided so that committees could meet and so that proper deliberations among the members of the chambers, of both this and the other place, could occur. The Opposition accepts this change. We regret that these sitting hours, so demonstrably and so soon, have proved so inadequate. Perhaps this might yet be another catalyst for change and the Leader of the House might, in his wisdom, be able to persuade those in Caucus who imposed on him the present hours, to try to introduce a sittings pattern which can be consistently maintained and which is something which would meet the needs and requirements of most members of this place. It is rather sad that, in accepting the motion, we have so soon found it necessary to modify the ridiculous sitting hours to which we are now subject. Mr LIONEL BOWEN(Kingsford-Smith-Leader of the House)(2.55) —in reply-I thank the honourable member for New England (Mr Sinclair) for his support of my motion . The reason why we are suspending the rule is to enable 15 Opposition members to participate in the debate. I should have thought that that would have been recognised. Mr Anthony —What about tomorrow? Mr LIONEL BOWEN —There is other business tomorow. Unfortunately, one cannot just do a Bill a week here. We now have 120 Bills listed for this program. I want to assist the right honourable member for New England. I have not moved at what hours we shall suspend for our evening break. If he feels that he needs one and a half hours in which to eat, perhaps we can come to some accommodation. Of course, with the hours listed this evening, I would not have thought that he would have made any other arrangements for dinner, because we would not have been concluding until 8 p.m. under the old rules. Mr Dobie —There is the dining room's capacity to service. Mr LIONEL BOWEN —I appreciate that, and there may be special problems. We are doing this on the basis of assisting the dining room, Hansard and the other staffs, including the Clerks. I know that politicians can go without food, particularly the honourable member for Cook (Mr Dobie). If the right honourable member for New England wants to have a little longer break this evening, I make the point that we still have not moved that motion and will not do so until about 6.30 p.m. Question resolved in the affirmative. Discussion of Matter of Public Importance Mr SPEAKER —I have received a letter from the honourable member for Denison (Mr Hodgman) proposing that a definite matter of public importance be submitted to the House for discussion, namely: The alarm and anxiety aroused in the Australian community by the Hawke Government's radical changes in immigration and ethnic affairs policies. I call upon those members who approve of the proposed discussion to rise in their places. More than the number of members required by the Standing Orders having risen in their places- Mr HODGMAN(Denison)(2.57) —The Hawke socialist Government's radical and dangerous changes in immigration and ethnic affairs policies are arousing considerable alarm and anxiety throughout the entire Australian community. Putting it bluntly, Australia's immigration and ethnic affairs policies, under the new Minister for Immigration and Ethnic Affairs (Mr West), have taken a radical and dangerous turn to the Left. Bearing in mind the Minister's well- known ideological commitment to the socialist Left, this is only to be expected. He is, of course, the only representative of the socialist Left in the inner Cabinet and it is therefore not surprising that he has used his muscle to ensure that under the Hawke Government's new-found immigration and ethnic affairs policies the philosophies which he espouses will be put into effect. The upshot is that in the short period of just six months the character and direction of Australia's immigration and ethnic affairs policies have been radically altered-for the worse. These new policy directions are already causing an enormous electoral backlash and large numbers of the Australian community are gravely concerned about what is going on. In particular, many members of ethnic communities who swallowed the socialist bait and changed their normal vote on 5 March will most certainly be now voting again for the Liberal Party and the National Party at the next Federal election. From the word go, the Hawke socialist Government's attitude to Australia's ethnic communities was, bluntly, having got their votes: We will now do our own thing. To the intense distress of the overwhelming majority of Australians and to the particular distress of many significant ethnic groups in this country, the Hawke socialist Government moved speedily to implement a policy of appeasement towards the Soviet Union by lifting all sanctions which Australia had imposed against the Union of Soviet Socialist Republics following its brutal invasion of Afghanistan. This shameful and disgraceful sell-out provoked many leaders of ethnic groups in Australia to complain bitterly to me that the Prime Minister (Mr Hawke) and his Government were now pursuing precisely the same discredited policies of appeasement as Mr Chamberlain had pursued towards Hitler in the late 1930s and that the Hawke Government's action in lifting the sanctions was just as disgraceful as the Whitlam Government's action in according de jure recognition of Soviet incorporation of the three Baltic States -Estonia, Latvia and Lithuania. Within two months of coming to power the Hawke socialist Government, through this Minister, moved to introduce a harshness and rigidity in Australia's immigration program unparalleled in the history of this nation. The Minister moved to abolish all ministerial discretion in relation to persons in Australia on visas who wish to change to permanent resident status. He bluntly proclaimed that he was abandoning, and in fact destroying, his ministerial capacity to approve a change of status, with only one exception, and that was if the person concerned married an Australian citizen. It was bad luck if the person concerned was already married or did not want to get married. The Minister effectively said to thousands and thousands of talented young people from all over the world , who might, while visiting Australia, by coincidence meet employers who desperately needed their special talents and abilities, that they would not be allowed to stay permanently in Australia but would have to return to their home countries and join the queue in lodging an application for permanent resident status. To put this matter in context, I inform the House that in the whole of 1982 some 15,000 people in Australia on temporary visas sought to change to permanent resident status. After very careful examination of their cases and the proper exercise of ministerial discretion, a mere 1,000 were permitted to remain in Australia and they have become very good Australian residents. Under this new Minister and the harsh new policies of the Hawke socialist Government, only those persons in Australia on visas who marry an Australian citizen have been permitted to stay. The rest of these talented people, most of them young, have been packed off home and told to make their applications at home, in many cases involving a delay of up to 12 months. Sadly for Australia, in the overwhelming majority of cases this country will never see these talented young people again. The loss is ours. If the Minister in his speech again tries to suggest that I or the Opposition are advocating back door or queue jumping immigration, let me nail that argument here and now. It is a gross misrepresentation of the truth to suggest that the addition of about 1,000 new permanent residents in a year will adversely affect Australia's unemployment situation. It is a fallacy to suggest that in an overall migration program of between 80,000 and 90,000 for 1983-84 this small but, I repeat, very talented group of people will in any way affect the unemployment situation, particularly when the Minister and the Hawke socialist Government have faithfully promised the people of Australia that they will create an additional 500,000 jobs in Australia during their present term of office. Mr Groom —They are not going too well. Mr HODGMAN —No, they are not going too well, particularly in Tasmania, where 337 workers were put off. The Hawke Government has not provided a single job for those men who were put off the Gordon below Franklin power development scheme, in the electorate of the honourable member for Braddon (Mr Groom). The Minister, in his ministerial statement on 18 May, announced a massive cutback in the number of people who will be permitted to migrate to Australia under the occupations-in-demand sub-category. Incredibly, this socialist Government has dropped the points for English language in relation to family selection purposes , thereby blatantly introducing into our Australian migration program a deliberate bias-it is almost unbelievable-against prospective migrants who happen to speak the English language. Does the Minister not accept the fact that English is Australia's primary language? Why does he deliberately act in this incredible manner? Furthermore, the Minister personally strongly supports increased refugee intake from Central America and South America. The Opposition is concerned that there are some 300,000 refugees from Central and South America and again calls on the Minister to exercise the greatest care in this matter. If these people are genuine refugees, that is fair enough. If they are something else then Australia, under this Minister, could be importing into this country a veritable time bomb. As if all these matters were not enough, other developments in recent months have shocked many Australians and many ethnic communities. The Government quite deliberately proceeded to appoint the board of directors of the Australian Broadcasting Corporation without including any representative of Australia's ethnic communities, notwithstanding the urgings of Senator Peter Baume and the Opposition spokesman in this House, the honourable member for Murray (Mr Lloyd). The Government, at its first attempt, was prepared to go ahead and appoint political supporters to the Special Broadcasting Service and to leave out totally any representative of Australia's largest ethnic group, the Italian community. The Prime Minister most discourteously and ungraciously offended the Melbourne Greek community and Australian-Greeks throughout this nation by failing, at the last minute, to honour a firm commitment which he had accepted. The Minister was unable to be present, for reasons which I understand, at a New South Wales Ethnic Communities Council forum which was specially televised by Channel 0-28. But the Minister will be interested to know that his representative at that forum was obliged to commence his speech by telling the gathering that the Department of Immigration and Ethnic Affairs had given him the wrong speech. The decision by the Hawke socialist Government in July to issue an open slather invitation to Soviet cruise ships to visit Australia again distressed many ethnic groups and many Australians. The Government's failure to make any real progress on the question of East Timorese family reunions has dismayed everyone genuinely concerned with this major human rights issue. The Hawke Government's recent action in virtually abolishing deportation from the Australian statute books has appalled the entire community. The only people who will be cheering are those non-citizens engaged in organised crime, drug trafficking, and even espionage and the harbouring of spies who are now as safe as a church after 10 years residence in Australia. This was particularly well put by my colleague the honourable member for North Sydney (Mr Spender), whose statement entitled ' Australia-a haven for organised crime' is worthy of special mention in this debate. I will read from this statement, which was written by one of Australia's leading Queen's Counsel. The honourable member states: The Government's amendments to the Migration Act open up a huge gap in Australia's defences against organised crime. Under the amendments, ten years' lawful residence in Australia, or lawful residence totalling ten years, makes non-citizens virtually secure from deportation. So long as a non-citizen is not convicted and sentenced to at least one year's gaol for an offence committed during that ten year period, the Minister is powerless to deport him. After ten years, the Minister's power to deport is limited to convictions for such extraordinary and unusual offences as treason or inciting mutiny. The result is that non-citizens have after ten years' lawful residence in Australia, a licence to do what they will without fear of deportation. It does not matter that they never intend to take up citizenship. It does not matter that their actions constitute a threat to the security of Australia. After ten years they are safe. They are safe after ten years even if they then commit and are convicted of offences such as trafficking in dangerous drugs, organised criminal activities, murder, kidnapping, blackmail and extortion, to name but a few. I add, as I pointed out in another debate, espionage or harbouring spies, including people such as Mr Valeriy Ivanov. The honourable member for North Sydney, and I agree with him, goes on to state: The Hawke Government apparently believes that after ten years these kinds of non-citizens have rights in Australia. The Government apparently believes that Australian society has no right to protect itself against these kinds of people by deporting them. The Government's amendments to the Migration Act show an astounding lack of values and an equally astounding disregard for the need to protect Australians against predators who should never be allowed to live here. I believe that the overwhelming majority of Australians would endorse and applaud those remarks by the honourable member for North Sydney. If we add to all those items the scandalous actions of the sort of people the Hawke Government is now admitting into Australia the picture is almost complete. I have only to mention the names of Professor Hidaka and Mr Brett Collins to make my point. In the Hidaka case the people of Australia are entitled to know why this man is now in this country, bearing in mind the very careful decisions of those most careful former Ministers, the present honourable member for Balaclava (Mr Macphee) and the former honourable member for Petrie. The people of Australia are entitled to know why this man is now in this country, bearing in mind the strong and unequivocal advice of Australia's former ambassador to Japan , Mr John Menadue, now a permanent head under the Hawke Government. They are entitled to know that bearing in mind the strong and compelling security advice provided to the former Government and a public statement by the former Leader of the Opposition, now the Minister for Foreign Affairs (Mr Hayden), that on the basis of the information put before him the Fraser Government's decision on Professor Hidaka, in refusing him admission to Australia because of his proven links with the Red Brigade, was justified. That is what the Minister for Foreign Affairs said just 12 months ago. What new information has come to light which justifies this socialist Minister making a 180 degree turn on the decision in the Hidaka case? As for Mr Collins, I simply say that the Minister's answer in the House last week has raised more questions and more doubts as to what on earth he is doing to Australian migration policies than it has provided answers. If he does not believe me I suggest he talk to some of this Australian Labor Party colleagues in the New South Wales Government and they will put him on the right track. These radical changes, these dangerous changes, in Australia's immigration and ethnic affairs policies have shocked and astounded many, including a large number of traditional ALP supporters. What this socialist Minister is doing today will have a major impact on the sort of Australia we will see a few years down the track. Mr WEST(Cunningham-Minister for Immigration and Ethnic Affairs)(3.11) —I have detected no alarm in the migrant communities. As I have moved around Australia I have detected only support of the warmest kind for all that we are trying to do for the migrants and permanent residents of Australia and for those people who have joined us from other lands and have taken out citizenship. In the short time available to me I want to quickly tell honourable members of a much broader scope of policies that I have not yet had the opportunity of explaining in the House. The Opposition's view has been concentrated on several issues of a most narrow kind. The first decision that I and the Government had to make was whether to continue with a large scale migration program during a time of high unemployment and depression. Of course, because over four million people, who were born overseas, were already in Australia, I knew that we had to continue with the migration program. We are a nation of immigrants, whether we like it or not. We have been a nation of immigrants since 1788, but particularly since the Second World War. So we opted for a program of some 90,000 visaed migrants this financial year, which is slightly more than the former Government achieved in 1982-83. There will be more family reunions-some 57,000-and 20,000 refugees. The reason we were able to attain that number is that we knew it was not viable to continue bringing here people who were allegedly skilled for jobs that no longer existed. That is why I have toned down employer nomination and occupational demand as separate categories. The former Government had commenced winding that down. This financial year we expect about 6,000 in that category to immigrate. I was concerned that, on the instruction of the Department of Employment and Industrial Relations, last year we were receiving schedules of 80-odd different categories. The previous Government had reduced the number of categories to 20 and I am in the process of reducing it further. We found belatedly that boilermakers and stenographers were coming to Australia, when employment collapsed last year, for jobs that no longer existed. In that situation of course I make no apologies for turning the emphasis back on family reunion. I repeat: This year some 6,000 people will immigrate under the business migration, employer nomination and occupational demand categories-about 2,500 workers. The Minister for Employment and Industrial Relations (Mr Willis) and I are now working on a revised schedule, a revised approach, towards ensuring that if an employer really needs a person will skills which are in demand in Australia we can meet that requirement. But we are not going to bring people here when they know that jobs no longer exist. I addressed another issue: The trans-Tasman problem. Everyone seemed to be saying that we have to interfere with the free flow. We looked at that matter, examined the trade implcations, the employment implications, the social and historical implications and, of course, we took the right decision. The Prime Minister of New Zealand congratulated us on it when he was here. What about that decision? Has it not been applauded? I turn to working holidays which honourable members opposite seem to be so concerned about. First of all, it is a complete mistake to say that we are rigid , that I have no discretion, and I have absolved myself of all discretion, simply because I have cracked down on working holiday makers. Let us look at the facts. Working holiday makers agree to come here for 12 months and to work for three months in one job only. It is a cultural scheme. In 1982 under the previous Government's scheme 18,467 came to Australia but only 7,200 Australians went out. Straight away there was an imbalance that had to be corrected. The previous Government allowed 1,000 people, who had said that they did not want to change residence, to change residence mainly on occupational grounds. I make no apologies for this. I do not think that that action is justified. Many hundreds of thousands of young Australians and young permanent residents who join us from other lands cannot get jobs at this time. Working holiday makers sign a piece of paper which says: 'I will not seek permanent residence. I will work for three months in a particular job to supplement my working holiday and then move on'. They then come here, get a job and blatantly continue working for up to 12 months. Then, because the employers think that they are good workers, or because they can get their employers to say that they are good workers to suit their own ends, they seek to change their status to permanent resident. There are some very severe implications if we let people get away with that. We are trying to run a tight, firm but fair immigration policy with emphasis on refugees and family reunions and some emphasis on occupational demand. Whatever the shadow Minister says, it is a back door migration scheme if we let it get out of hand. It is not true to say that no one is changing status. Mr Cadman —But it was not out of hand. Mr WEST —It was out of hand. It was a side door migration intake scheme for people who in many cases did not get through the normal migration system. I am still allowing ministerial discretion, on compassionate grounds, under section 6A (1) (E) of the Migration Act. We are very tight with people seeking employment but not with those seeking to migrate on compassionate grounds. That is the position with working holiday makers. As every honourable member knows, discretion is still being used to allow in people who may not normally get through the points system. I now address myself to the much broader scale of migration policies instead of just working holiday makers. I realised that the system which operated under the former Government-that is, one of sponsored entry-benefited those people who were highly educated, English speaking and quite wealthy. Family reunion, at a time of recession, is a humanitarian program. It should not be seen as a program to bring in people to fill jobs. That is what the former Government did. It had a family reunion program when it was not having a family reunion program. Under the points system a lot of people were more entitled than others to family reunion. What I did was revise it. It is not true to say that English speaking migrants are disadvantaged. All we did was ensure that non-English speaking migrants were not disadvantaged, and that is a different thing altogether. As an inventive I have given more points to citizenship than to permanent residence. That is the sort of thing we are doing in that area. I am quite proud to say that it is now easier for people from the lower end of the socio-economic scale, from non-Commonwealth countries, to get into Australia than it was. However, we are trying not to make that to the disadvantage of English speaking people. I now turn to refugees because that is another significant area in which we have made significant progress. We have held the numbers. We have introduced two programs: The United Nations type assisted passage program of 15,000 funded places with 2,000 in contingency reserve and the special humanitarian program of 3,000 funded places. That is very important. The honourable member for Denison ( Mr Hodgman) mentioned south and central America. I make no apologies for the fact that under the humanitarian program we have provided sanctuary for people from El Salvador amnestyed from prison on civil rights grounds. Almost 100 of them have come here recently. I took action for the Sri Lankans recently. We have made special provisions under the family reunion category and special humanitarian program for Sri Lankans and similarly for the Lebanese. I announced in the House last week how we were ameliorating the entry procedures for the Lebanese. On the other side of the political coin, if you like, I have also approved the entry under an ongoing program-the special humanitarian program-of 400-odd Assyrians who are anchored in, I think, Rome and Athens. They come from the Middle East, from Iraq and Syria, where they have suffered persecution. They will be coming to Australia to join families who are out here. What is more, I intend in the near future to take up the Chilean question once again. If all goes well I may be in a position to announce in the very near future that we will take special measures, taking into account what is going on in Chile at the moment. I make no apologies for all of this. Recently I went to Honolulu to an inter-government consultation on refugees with the Americans, the Canadians and the Japanese. We agreed we would continue with resettlement. We agreed to continue to internationalise the Indo-Chinese problem and to bring the United Nations High Commissioner for Refugees into it more. I pushed a mix of policies, not just resettlement, but the matter of orderly departure from Vietnam, which really means family reunion instead of unorganised departure. I pushed the concept of voluntary repatriation where possible. I then went to the Association of South East Asian Nations and spoke to the Foreign Ministers of Indonesia, Malaysia, Singapore and Thailand. I also spoke to the Prime Minister of Thailand. Every one of them agreed with our current refugee policy. I admit we inherited some of that from the former Government; we have simply diversified it to a great degree. The ASEAN nations have agreed to continue to be places of first refuge. We have agreed to continue with moderate resettlement. They all agree that we should continue, through the Minister for Foreign Affairs (Mr Hayden), to talk to Vietnam about orderly departure from Vietnam and the possible voluntary repatriation of minors and to tackle finally the problem of voluntary repatriation of Laotians and Kampucheans . If we can work with the Vietnamese Government to achieve that instead of seeing them all flee to Thailand, of course we will do so. There would be no more tragic consequence for Australia's relations with the ASEAN nations than to take notice of the conservatives and the conservative organisations in this country who would urge us to break off from these refugee programs. We are not going to listen to them. These are positive things. I say this: We live in a multicultural society. We accept that. Whether we like it or not, it is here. What we will do is try to ensure that the multiculturalism which exists does not become an instrument of class repression in the sense that people who cannot speak English very well are downtrodden socially as a result of their ethnicity. The Government will provide programs for such people. The Opposition while in government did the same thing to a lesser degree through mainstreaming and through providing extra programs. The former Government had got into a position whereby funds for migrant resource centres were pegged and grants-in-aid were not increasing. There had been no progress in devolving NAATI-The National Accreditation Authority for Translators and Interpreters-to the States. Let us look quickly at what we have done in the last Budget. We have provided extra funds for creating permanency in the adult migrant education service. We will move towards that as quickly as we can. We will particularly address the matter of teachers who have had two years or more in full time casual work. We have provided extra funds for 60-odd more grants-in-aid. That means that 140 to 200 more grants will be allocated by December this year. We are expanding the number of English courses available on the job in industry through the adult migrant education program. We will also increase child care facilities by providing some $200,000 during 1983-84. The grants-in-aid will cost us $1.6m extra in a full financial year. The finances of migrant resource centres were pegged for several years. We increased the funding by 45 per cent in the last autumn appropriations and in the last Budget. They are some of the things we are doing for programming. Let us turn to the area of legislation. The honourable member for Denison mentioned the Migraton Act. Yes, we have amended the Migration Act. We removed the discrimination between immigrants and aliens, between Commonwealth and non- Commonwealth citizens. Yes, I have extended the same sort of amnesty on criminal deportation of non-Commonwealth citizens that Commonwealth citizens have enjoyed for many years. In the security area, where it was possible before to deport people at the Minister's whim because he said their character could not stand up to scrutiny, it is now possible to deport only on security grounds people who have had up to 10 years residence, unless they have been convicted under the Act , and then they have a right of appeal. They are the sorts of things we are doing across a whole range of areas-legislation, programming, mainstreaming and the intake program itself. Finally, before this session is over, we will address the long-standing problems in the Citizenship Act. We will address the problem of complaints about the taking of an oath and the necessity to have a commanding knowledge of the English language. We will have a look at the application provisions. I have decided on and set up a review of the Australian Institute of Multicultural Affairs. As I have said, we have devolved NAATI to the States. We have set up a review of the intake of private overseas students, which I mentioned this morning in my address to the House. So we reject everthing that the honourable member for Denison said. We are trying to ameliorate the conditions in the prohibited immigrant detention centres, such as Villawood. The Human Rights Commission report will be taken into consideration. Across that whole range of policies I have proved that the honourable member is not correct. Mr DEPUTY SPEAKER(Hon. Les Johnson) —Order! The Minister's time has expired. Mr CADMAN(Mitchell)(3.27) —The House has listened with interest to the speech of the Minister for Immigration and Ethnic Affairs (Mr West). He has presented a number of interesting ideas. Unfortunately, I feel that his ideology affects his judgment to a fair extent in the way in which he speaks about the important area of migration and ethnic affiars. There have been radical changes in Australia's migration policy. They are changes that are viewed with alarm and anxiety by the Australian community, particularly those sections of the community which have come here from overseas. I wish to list for the House some of the changes that have taken place under the present Government. First of all, the intake of migrants to Australia has been reduced. The Minister cannot explain away the fact that the same plus and minus issues will apply to his programs as applied to the previous Government's. At the end of the year we will find that the intake of migrants for 1983-84 will be down. It will be down because of the Government's agreement with the Australian Council of Trade Unions in the accord-and it is clearly spelt out- that migration will be reduced. The ACTU was careful to have the Government agree to that provision to ensure that job shortages could be created in certain areas so that the demands of those employed in select areas would not be threatened and in fact their bargaining powers would be increased. The sanctions against the Soviet Union have been mentioned by the honourable member for Denison (Mr Hodgman). That is a radical change. Employment demand-that is the category that allowed people to gain entry because there was a shortage of certain skills in Australia-has now been almost removed. The Minister says that some slight modifications are in the pipeline. It will be very interesting when the pipeline produces the results of those considerations. Mr Hunt —It will be a mess. Mr CADMAN —It will be a mess because the Minister has failed to recognise the important and significant interlocking process between family reunion and employment. Many people seeking entry to Australia have moderately high skills and they have relatives in Australia, but on the single criterion of relationship or employment prospects they are not eligible to come to Australia. It is a perfectly reasonable proposition to understand that a person with moderately high skills, who can be supported by a family familiar with Australian conditions who will provide accommodation and maintenance for a short period, is the sort of person who will settle readily in Australia. That sort of person has been removed from the migration program. There is no consideration in the Minister's presentation of the wider family concepts that apply in so many countries from which Australia receives migrants. The whole of Europe and Asia in fact has a different concept of families compared with Australia's concept. Families in those continents extend far beyond the immediate family-husband, wife, parents and children-to cousins, uncles, nephews, and nieces. A very wide network of support and responsibility is felt by families who have come to Australia, especially those from trouble spots of the world where, by economic circumstances or international turmoil, their extended families are being threatened or interfered with. It is perfectly responsible and reasonable that Australia should take some cognisance of that very fine feature of migrants to Australia; that is, their concern and support for families. It is the great strength of migration and it is the great lesson that the Australian community is learning from our migrants. It is a process that needs to be encouraged, but it is a process which, by the Minister's decisions, has been completely denied. The combination of employment and family reunion has now been removed from the whole gamut of our immigration program. The family reunion program has been calculated to involve 57,000 people in 1983-84. I predict that that figure will be considerably less. Substantial changes have also been made to the deportation provisions. Spies or drug runners, provided they stay in Australia 10 years, can stay for ever more and nobody will worry about them. I think that is a very faulty policy. Refugees are allowed into Australia at the Minister's whim. Those who were not refugees are now refugees. They are the refugees you have when you are not having a refugee, to rephrase slightly the Minister's phrase. I think the Minister needs to move around Australia, look at the migrant communities and talk to Australian citizens and Australian residents in much the same way as the shadow Minister does in order to communicate effectively with migrants, to understand their problems, to get to know what their needs are and for them to understand what Australian requirements are. It is all very well to be known as a busy and hardworking Minister, but the people are important. Mr Groom —Face to face. Mr CADMAN —Face to face, as my colleague said. That is what makes an effective policy for government. I suggest that the Minister take a leaf out of the shadow spokeman's book and go out and meet the people. There are some radicalising elements within the change of policy, and these elements are of even greater concern than the policy changes that have been made. I have mentioned refugees who are not refugees and I referred to people being allowed entry from El Salvador and Chile. The Minister said that he makes no apologies for changing our refugee policy so that he can roam the world, identify the groups which suit his ideological outlook and say: 'I will classify you as refugees and you will be welcome in Australia'. That is a phoney approach to the refugee problem. I believe that it completely denies any consideration of the fine program for refugees set up by the United Nations. The office of the United Nations High Commissioner for Refugees is involved in the process of identifying areas of real need. It is a false and dangerous process for any Minister or any representative of the Australian Government to put the High Commissioner aside and say: 'I will set my own criteria for refugees and if I am politically responsive to the group whom I consider to be refugees they will be allowed entry into Australia'. I believe that the Minister could roam the world, identify groups of refugees outside the United Nations charter and allow them entry. I do not know how residents and citizens of Australia who have come from overseas and settled here will feel when the Minister goes off on a world trip and identifies a group in a neighbouring country which is hostile to the country of their relatives who have sought entry for many years. Mr West —Mr Deputy Speaker, I raise a point of order. I suggest that you ask the honourable member to address the problem in truthful terms. The fact is that I do not roam the world looking for refugees. Mr DEPUTY SPEAKER —Order! I ask the Minister to resume his seat. There is no point of order. Mr CADMAN —The Minister said that he makes no apologies for this program, and he is now trying to apologise for it. What criteria will the Minister use for selecting refugees? Who selects the refugees? What are the security checks? We have had changes made to the criteria concerning refugees from Lebanon and I would like the Minister to provide information to the House as to how those refugees will be selected. Will all of those who apply or who have current applications be accepted? Will there be security checks? The process of security checks and the proper identification of suitable refugees and migrants are very significant as can be seen when one reads today's Bulletin which states that Mr Ahmed Shuhati, the former Director of the Libyan Foreign Liaison Office, is currently leading a Libyan delegation. Mr Shuhati is also in charge of Libyan propaganda and cultural centres throughout the world. That delegation leader will make contact with groups who are causing great trouble in ethnic communities in Australia. I mention in particular the problems that have been caused at the Lakemba mosque in Sydney where newspapers, underground groups and other activities have been encouraged by funds flowing from Libya. I am sure that if the Minister had sought and received wide advice from all aspects and all avenues within government he would have been advised that this is a most dangerous process and one that should not be encouraged. We need proper security information and proper decisions on visitors of this type. Mr DEPUTY SPEAKER —Order! The honourable member's time has expired. Mr RONALD EDWARDS(Stirling)(3.38) —I think it is very unfortunate that in the context of this debate this afternoon the Opposition has failed to address itself to one of the really serious issues facing the Australian community; that is, racism. It is also very unfortunate that the Opposition spokesman on immigration tried to blow up divisiveness where there is no divisiveness. There is enough divisiveness facing this community in terms of migrant issues and the mass issues of unemployment, without the Opposition talking as though we run our immigration policy on the basis of some ideology. The Opposition might find it convenient and easy to posture, but the people will not be deceived. One of the major issues we inherited from the lamentable previous Government is mass unemployment. As the electorate well knows, in the face of mass unemployment people begin to wonder why they do not have jobs when someone from overseas has a job. It is a very serious issue. It is not one given to party politics and it is not one that the Opposition should exploit cheaply, but I see that it deceptively does so today, and it is to its own disgrace that it does. I notice that the honourable member for Mitchell (Mr Cadman) is leaving the chamber because he does not seem to want to address these issues seriously. If he had addressed these issues seriously he would have begun to talk about the contribution he can make as a member of the Opposition, to the proper development of immigration policies. We began in government with the belief that there was an opportunity to develop bipartisan policies with respect to a number of matters: Industrial relations, economic planning and immigration. By its moves today the Opposition has indicated that it will seek to behave as divisively as it did in government. The migrant community and the rest of the community will not admire it for that. That is why the former Government is in opposition and that is why it will stay in opposition. It does not have the breadth of vision to come in here with decent proposals or an ability to put together policies to which the rest of the community can relate. Let us go to the details of the matter. It seems to me that when we as a community seek to bring in people from countries such as El Salvador and Chile the honourable member for Denison (Mr Hodgman) says: 'You are bringing in people from left wing backgrounds'. How do Opposition members account for the fact that we inherited from them a policy, which we endorsed, to bring in people from Indo -China? I know it is awkward and I know that honourable members opposite do not find that very straightforward but we did the right thing. We inherited a policy with respect to Indo-Chinese migrants. We have continued that policy and we are seeking to deal positively with that policy. We are also bringing in people from Syria and Sri Lanka. We have sent an immigration officer to Sri Lanka and to El Salvador to try to expedite those processes. These are not easy manoeuvres; they are not things that this community necessarily wants to take lightly. But it places these people in serious danger. Certainly we are removing from serious danger these people whom we are bringing into this country. I believe that this matter of public importance does not address itself to some substantial positions. In our time in government we have sought to expand the family reunion program. We have evidence of this. In terms of family reunion we are increasing the number from 46,000 to 57,000. The honourable member for Mitchell said that we are not concerned about family reunion. Those figures are not an invention; they are a reality. The honourable member for Mitchell will have to deal with that reality, as awkward as that might be. I can understand why he might find that awkward. It seems that many Opposition members find great difficulty in dealing with the facts. One of the facts of life is that they are in opposition, and they will stay there while they act as weakly, incompetently and irrelevantly as they currently do on major issues of policy. It is wonderful to hear such irrelevant posturing from the honourable member for Denison and the honourable member for Mitchell. But let me go on. We have also made some major moves with respect to having multilateral talks. The Minister for Immigration and Ethnic Affairs (Mr West) has recently been to Honolulu to talk about that. The honourable member for Mitchell cheaply seeks to exploit that. What is wrong with talking with other countries about orderly migration programs, with talking with one of our allies, the United States of America, about a decent migration program? Somehow, honourable members opposite seem to find that awkward. I, the Government and the Australian community do not find it awkward because we believe in consultation. Honourable members opposite may believe in conflict and divisiveness and they may think it is easy to snipe. We believe in decent consultation with people to try to get an orderly immigration program going. I believe that there are some other things with which we have to deal. If we look at the overall Budget appropriation for the Department of Immigration and Ethnic Affairs we find that there has been a 14 per cent increase. Again, honourable members opposite find factual information such as this awkward to deal with. It may be too complex but I think it is also too awkward because it tends to tell a story which works in the favour of the Minister for Immigration and Ethnic Affairs-that is, that we have increased the amount we are spending on immigration. If we look at some of the specific areas, we see that in 1983-84 an additional 60 grants will be made for migrants at a cost of $778,000. This will take the total amount, in terms of grants in aid, to $4,878,000, which is up on the amount of $3,150,000 that the former Government spent in its latter, lamentable days. We are spending money in the immigration area because we believe that that is very important. We believe that, in order to try to make this an effective multicultural community, we, as a government, have to take responsibility for matters such as these; we have to have reasonable programs and we have to spend money on them. This is one of those programs. Let us look at the question of assistance to migrant resource centres. In the 1983-84 Budget we plan to spend $1,520,000. During the 1982-83 period the former Government spent $1,320,000. So we have increased the amount we are spending on migrant resource centres by $200,000. It is interesting to see the honourable member for Perth (Dr Charlesworth) in the chamber at present. Both he and I recognise that the North Perth Migrant Resource Centre plays an important role in our community. It has a great deal to do with major issues concerning migrants. We believe that this amount of expenditure is the sort of thing that government should be doing. I had hoped, on coming into this chamber, to hear those on the other side of the chamber say: 'Yes, we endorse that. We believe that that is the right way to move. We want to move that way'. That is why I am suggesting to honourable members opposite in debates of this kind that the community is seeking solutions . It does not want its problems exploited. That is what the previous Government did for seven years and that is why Opposition members are where they are. We are here to try to offer solutions. We are also here in the desperate hope that one day honourable members opposite might actually be able to work without conflict and with consensus. That is why we continue to make these appeals to honourable members opposite. Honourable members opposite should try to support us in some of these manoeuvres rather than simply try to exploit them. We have budgeted $42m for adult migrant education programs. The previous Government expended $36m. Again I am suggesting to honourable members opposite that these are major programs and initiatives. They represent the way in which this Government is responding effectively to the demands of the community. We have a multicultural community and we do not seek to exploit those divisions. In fact, we seek to enhance the nature of our multiculturalism. I note also that there has been some comment on some specifics with respect to someone like Professor Hidaka. I understand that I make it uncomfortable for honourable members opposite when I mention the name of Professor Hidaka because the former Government prevented him from coming to Australia. I congratulate this Government and the Minister for Immigration and Ethnic Affairs for intelligently allowing Professor Hidaka to come to Australia. Honourable members might ask why. I do so because thousands of respectable people believe that Professor Hidaka can make a contribution to the Australian academic community. There are people in the academic community and people in Japan who also believe that Professor Hidaka can make a contribution. I know that honourable members opposite may find this awkward. But we believe that Professor Hidaka has a right to free speech and he has a contribution to make. When we consider that, in the past, previous government leaders were opposed to freedom, particularly within their Party, I can understand how awkward it is for honourable members opposite when people want a free say. Honourable members opposite may have had very desperate and very awkward leaders in the past who did not particularly like people to speak out against them. We are not afraid of that. We do not have things to hide. If honourable members opposite have things to hide they should go away and hide them somewhere else because we are not worried about that. We welcome Professor Hidaka to Australia. We believe that we can build a community that is more fairly based, more equitable, more just, and more honest. We are not afraid to aim for those targets. We are not afraid to do these things. Honourable members opposite cannot contribute to this sort of debate because all they grew up with was seven years of conflict and divisiveness. Their behaviour today is further evidence of that. Mr DEPUTY SPEAKER —Order! The discussion is concluded. The following Bills were returned from the Senate without amendment or requests : Income Tax Assessment Amendment Bill (No. 3) 1983 First Home Owners Bill 1983 Home Deposit Assistance Amendment Bill 1983 Housing Loans Insurance Amendment Bill 1983 Debate resumed. Mr DEPUTY SPEAKER(Hon. Les Johnson) —Before the debate is resumed on this Bill I remind honourable members that it has been agreed that a general debate be allowed covering this Bill, the Medicare Levy Bill 1983, the Income Tax Laws Amendment (Medicare Levy) Bill 1983 and the States (Tax Sharing and Health Grants) Amendment Bill (No. 2) 1983. Mrs KELLY(Canberra)(3.48) —I listened with interest to the previous speaker in this debate, the honourable member for Warringah (Mr MacKellar), and took note of the various criticisms he made of the proposals which we are debating today. He criticised the proposed Medicare arrangements on the grounds that this was a socialist scheme being introduced by a socialist government. I see that the honourable member is nodding his head in agreement with what I say. In that the Medicare arrangement is universal, then indeed this scheme is a socialist scheme . In that it is based on a capacity to pay, again I believe that it is a socialist scheme and I am quite proud of that fact. There is no reason for us to apologise for that because those two fundamental issues are the basis of this Medicare proposal. Mr MacKellar —Nothing about the quality of health care. Mrs KELLY —Firstly, it is a universal scheme and, secondly, it is based on a capacity to pay. The honourable member for Warringah says that it is not based on the quality of health care. Indeed, the very aim of this scheme is to provide adequate health care for all Australians. That situation does not exist in this country today; nor did it exist under the previous Government and, in particular , the honourable member for Warringah when he was Minister for Health. So the whole basis of this proposal is to provide a health care system for all Australians. The honourable member for Warringah argued that the alternative provided by his Government was the solution to all the problems. In fact, it was the cause of many of the problems we have in health care in Australia today. I will just quote one aspect where the honourable member stated that the policy of his Government was based on a 'sense of responsibility of providers'. If a sense of responsibility of providers caused the $100m that has been lost to the taxpayers through overservicing and fraud by providers, I have some queries and doubts about the health system that existed under the previous administration, in fact under the previous Minister's administration. The other issue that was questioned by the honourable member was the problem of curbing costs and the costs of the new Medicare arrangements. I submit to this House that the legislation that we are introducing today-which is to come into effect on 1 February-is based on the assumption that there is a new attitude in the community today about health care costs and about efforts that should be made to curb health care costs. I believe that the investigation through the Joint Committee of Public Accounts of this Parliament into previous medical arrangements and the examination of health costs, overservicing and fraud have in fact led to a different attitude in the community about the costs of health services. I am quite sure that this House will see some major statements in the next few months about this whole issue of fraud and overservicing and how they can be detected. Another issue that was raised by members of the Opposition was the confusion that exists in the community. Any confusion that exists in the community has arisen because of the large number of changes that have occurred to medical arrangements over the last few years. The previous Government was elected on a commitment that it keep Medibank Private. It then changed its arrangements on about five different occasions. So if the community is confused, the only people who are to blame for the confusion are the members of the Opposition. What the Government is doing with the Health Legislation Amendment Bill, the Medicare Levy Bill, the Income Tax Laws Amendment (Medicare Levy) Bill and the States ( Tax Sharing and Health Grants) Amendment Bill (No. 2) which are before us today, is simply to put into effect a promise given to the electorate at the last election. It should be no surprise to the members of the Opposition, nor to the community at large, that we are proceeding to implement an election promise. These health care arrangements we are bringing in are an essential part of the prices and incomes accord, on which we have reached agreement with the unions. We have entered into a definite commitment. It is a commitment we are following through, unlike the previous Government which chose to ignore most of the commitments and the promises it made to the electorate. There has been some criticism about the administrative arrangements of Medicare . I believe that common sense indicates that we should administer Medicare through a single public fund aided by modern computer technology with all Australians being guaranteed medical and hospital insurance cover at the lowest possible cost. It is estimated that a single public fund will administer medical benefits payments for $30m less per annum than the current administrative costs of a large number of private funds that we have today. Both consumers and even doctors will benefit from the quicker payment of claims under Medicare. Doctors will be able to bulk bill and receive 85 per cent of the cost of consultations without incurring the expensive accounting and office overheads. I hope doctors will take full advantage of that system. This will be of benefit to patients who are pensioners, the disadvantaged and the chronically ill. It will provide a simplified and worry-free system for those patients. The Government does not support gap insurance for medical care. I support this view very strongly because I believe, like the honourable member for Prospect ( Dr Klugman) who spoke earlier in this debate, that gap insurance could well further encourage medical overservicing. However, as the Joint Committee of Public Accounts pointed out, there is a potential for abuse in bulk billing. In the progress report of the Public Accounts Committee, the Committee recommended that greater discipline needed to be applied to ensure better scrutiny of bulk billing procedures. I, therefore, welcome the insertion of proposed new section 127 (1) which, for the interest of honourable members, requires a practitioner, when agreeing to accept the assignment of Medicare benefits, to complete the assignment form before it is signed by the patient and to give a copy of the form to the patient as soon as is practicable. A contravention of this is punishable by a fine not exceeding $1,000 or a period not exceeding three months . This puts the onus on the doctor and allows for immediate action if this proposed new section is contravened entailing a substantial fine. I think that will be of great benefit to the cost containment that we are so concerned about as a Government in introducing this scheme. Another positive response to the recommendations of the Public Accounts Committee-I think this goes hand in hand with introducing the new Medicare arrangements-is that a whole new emphasis is being put on looking at overservicing and medical fraud. It has been particularly pleasing to see the build-up of staff in the Department of Health to deal with the problems that were outlined in the interim report of the Public Accounts Committee. I understand an additional 80 staff have been appointed at State and Federal levels through the Department of Health, as well as a task force, to deal with the backlog and complex cases in fraud and overservicing. There is also much greater co-ordination now between the Attorney-General's Department and the Department of Administrative Services with the creation of a central co- ordinating committee at both Federal and State levels to co-ordinate the three departments in relation to fraud and overservicing. These measures will not stop medical fraud and overservicing, but they do demonstrate a new determination and a will to come to grips with this massive problem, not only at the political level, but also at the administrative level. The Government, like the Public Accounts Committee, is very concerned about the need for cost containment. To contain costs we need a national cost control program with adequate statistics for evaluation, planning and control, and the co-operation of health providers-that is the States, the health institutions and the health professions with the public-to understand and work together for cost containment. I believe that over the years we have now got a different attitude in the community which is serious about cost containment. As a result of the medifraud inquiry, the Public Accounts Committee has made a large number of valuable recommendations which I believe the Government will follow-up. From the detailed inquiries of the Public Accounts Committee it is apparent that the user plays very little part in determining health costs. The typical, and usually the only contribution made by the user, is the decision to make an initial visit to the general practitioner or the local hospital outpatients department. The critical and potentially expensive decisions are the pattern of treatment, the referral to a specialist, the recommendation to a laboratory and x-ray examination, the admission to hospital and the prescription of medication. These decisions are made by general practitioners, specialists and hospital administrators. The suppliers, not the users, are the critical determiners of cost in the health area. They should be the prime objectives of cost containment policies. No doubt, if governments made user charges high enough they would have some effect on usage of health services but it would be very much at the expense of the poor, the aged and the chronically ill. The only significant effect of such a policy would be to limit the use of health services by those who need them most. In order to maintain efficient administrative controls over the delivery of health services, it is essential that all payment data is channelled through the one fund; that is, the national Medicare office. Without this control there would be no possibility of monitoring and checking fraud and overservicing which , it is estimated, has already cost the Australian community at least $100m a year. I am very pleased to see that the Public Accounts Committee has extended its terms of reference in the medifraud hearing. I hope that the inquiry goes alongside the further developments in the Medicare proposals. The proposal, for example, to revise the medical benefits schedule will ensure that cost containment is paramount in the implementation of the new Medicare arrangements. In conclusion, I believe that there is now a new awareness of the need to monitor spending on health services. In the long term this will ensure the introduction of more efficient administrative measures and a more equitable and universal system of health insurance. Until now ordinary families on average weekly earnings have paid up to $500 a year in health insurance. Now, under Medicare those families will pay approximately half that, or $4.50 a week, in the form of the one per cent levy. That is very good news for ordinary Australians. I believe it introduces a much more equitable health system into Australia, a health system which is available to all. Mr HUNT(Gwydir)(4.1) —I do not intend to delay the House because I know that many other speakers wish to address themselves to this legislation. However, as a former Minister for Health, I would like to make some contribution to the debate. During the four years I was Minister for Health I suppose I made more speeches on that subject that most honourable members in the Parliament. I compliment the shadow Minister for Health, the honourable member for Mackellar ( Mr Carlton), who very efficiently put the Opposition's case and its opposition to the four Bills-the Health Legislation Amendment Bill, the Medicare Levy Bill, the Income Tax Laws Amendment (Medicare Levy) Bill and the States (Tax Sharing and Health Grants) Amendment Bill (No. 2)-which are designed to restore Medibank under the new name of Medicare. These Bills will do nothing to improve the quality of health care in this country. Indeed, they guarantee, in my view, that health costs will once again explode as they did under Medibank. The honourable member for Canberra (Mrs Kelly) dwelt on the problems of medical fraud and overservicing. As a member of the Joint Committee of Public Accounts she is very well equipped to do so. It was a problem that occupied much of my time in the four years that I occupied the position of Minister for Health, as my submission to the Public Accounts Committee attests. I know that the Department of Health came in for a lot of criticism for not being able to come to grips quickly enough with the problems of medical fraud and overservicing. Nevertheless I must say that the Department of Health, during the time that I was Minister, although having problems with staff ceilings, worked extremely hard to come to grips with what is a very difficult problem. It is not until one becomes really involved in this portfolio that one realises the difficulty people have in trying to detect overservicing. Committees were set up in each State. Their terms of reference may not have been adequate, but enormous amounts of time were necessary to go through documents, case histories and so on in order to ascertain whether a doctor had overserviced in respect of a patient. One of the difficulties, in my view, that Medicare, as a reborn Medibank will face, is that it will undoubtedly encourage the same problems we had when I had charge of the Health portfolio. I know that it is an ideological and philosophical policy of the Australian Labor Party. It is a symbol of its philosophical approach. It is central to its concept of a welfare state, and it is really part of its social contract with the trade union movement. But it is a burdensome philosophical approach to welfare that has catapulted so many Western nations and so many Western economies into economic chaos. In order to make way for the Medicare program the Labor Government has had to tax lump sum superannuation payments and alter pension entitlement arrangements for the aged without giving due consideration to the social consequences of its actions. Canada is often taken as an example, and I know it was an example followed by the Labor Party and those people who advised it prior to 1972. Let us look at the Canadian situation and the problems it faces today. In 1983-84 the Canadian Federal Government will have expenditures of about $Can90 billion and revenues of $Can59 billion-a deficit of $Can31 billion, or one-third of the Budget. Twenty per cent of the Budget will go to service past debts. The Trudeau Government, with its Medicare program and its social welfare extravagances, has placed the Canadian economy in a perilous situation. The Medicare program in Canada continues on its costly way despite the concern of provincial governments , which are fighting a losing battle to contain costs without recourse to savage user charges and some bureaucratic controls. I am surprised that the Labor Party should have such a short memory. The economic rationalists of the ALP and those who seek lower taxation and economic recovery should not forget that when the Fraser Government came to office the rise in health costs in Australia had reached the highest rate of acceleration in our history-in fact, to the extent of 36 per cent per annum. Mr Braithwaite —How much? Mr HUNT —Thirty-six per cent per annum. In 1975 the Fraser Government inherited a shattered economy and a staggering Budget deficit. In 1976 there was no way that the then Liberal-National Party Government could continue to finance the accelerating cost of health care and restore economic stability to this nation. It was necessary to make substantial changes to the universal health insurance system-Medibank-because of the projected increases in health care costs in the Budget. The changes we made resulted in the reduction of health care costs from 36 per cent per annum to 10 per cent per annum by 1979. National health expenditure had more than doubled in three years from $2,505m in 1972-73 to $5, 660m in 1975-76, which was an increase of 125 per cent. After the changes to Medibank Mark 1 we reduced the rate of acceleration of health costs to 40 per cent over a three-year period. Nonetheless, national health expenditure had reached $8 billion in 1978-79. The taxpayers' share of national health expenditure had increased from $783.2m in 1972-73 to $2,736m in 1975-76, which was an increase of 249 per cent over a three-year period. I put those figures on the record because the Government needs to know where its policies are leading it. In the three years to 1978-79 the taxpayers' share of health expenditure increased by only 6 per cent to $2,901m. This was due largely to accountability both by patients and by providers of health care and to more competition in the market place. Let us look at what happened to doctors' fees during Labor's regime in the 3 1/ 2 years from 1972 to 1976. Doctors' fees increased for medical benefit purposes in those three years by 93.5 per cent. Over the next four years our Government had slowed the increase in doctors' fees to 31 per cent. However, the most remarkable consequence of Labor's Medibank was the increase in medical services by 13.1 per cent from 1973-74 to 1974-75 and by 28.5 per cent from 1974-75 to 1975-76. The changes to the Medibank scheme in 1976 resulted in a reduction in medical services of 4.8 per cent in 1975-76 and an increase of only 5.2 per cent between 1976-77 and 1977-78. The Medibank scheme was fraught with all the ingredients of undisciplined encouragements to abuse and overuse. It was described rightly as a pipeline to the mint for some unscrupulous doctors and paramedical practitioners. Mr Hand —It helped the sick, didn't it? Mr HUNT —It helped the unscrupulous providers of medical care more than it provided for anyone. The Labor scheme did nothing to encourage hospital managers to contain costs. I will refer briefly to the very important point that the honourable member for Prospect (Dr Klugman) made about health maintenance organisations. If we really want to contain health costs, I think we need to investigate and encourage the formation of such organisations in this country. Probably one of the best programs in the health area that Labor introduced was the community health program designed by Dr Sax. Of course, that program has now been handed back to the States and, as one would expect, the resources and the program have been gobbled up by the hospital systems. We are back to where we were before, with the resources going to the job security of people in the treatment of illness rather than giving due consideration to preventive health care. If the Minister wishes to make an impact on the total problem of health delivery in this country he needs to encourage the community health program and the philosophy that lay behind that program. I am concerned that Medicare offers the same deficiencies as the Medibank program did. It does nothing-this is the concern of the honourable member for Mackellar-to improve the quality of health care delivery. In its first full year , which let us face it will be its lowest cost year, it will add $1.7 billion to the tax bill and it will add 2,500 extra staff in the public sector, resulting in the loss of about 5,000 people in the private health insurance area. The one per cent levy is only a token levy. It will go nowhere near paying the $8,000m health costs borne by the taxpayers through either the Commonwealth or the State governments. The Goverment will undoubtedly increase the levy year after year to help offset the costs of this system and also no doubt will use it at times to help offset Budget deficits. Medicare will encourage too many people to drop private health insurance believing that it will provide comprehensive cover. In fact it will cover only 85 per cent of doctors' fees with no choice of doctors in hospitals. It will not provide health cover in the private hospital system. At least one-third of the existing insured people will pay more under Medicare than under the existing system. Mr Braithwaite —How many? Mr HUNT —One-third. Indeed, all taxpayers will pay not only the one percent levy but also additional taxation over and above the levy for this ideological extravagance. It will threaten the private hospitals of Australia, which provide about one-third of the available beds in this community. I think that in itself is a very serious prospect of disruption in the delivery of health services. It will reduce the competitive position of private hospitals and threaten to destroy any sense of responsibility in the health delivery system. Bulk billing of medical bills will be extended to all patients instead of being confined to disadvantaged patients. Free public hospital beds will be available to all patients, regardless of means. Medicare is a recipe for irresponsible abuse of the health care system. The existing system, though not perfect, provides universal health delivery to all Australians. It provides for the disadvantaged. It provides wide consumer choice and doctor of choice. It provides some discipline in the use of medical services through user payments. It promotes private medical practice in private hospitals. It provides opportunities for market forces to work. As I said earlier, I believe we will see a return to the explosion in health costs once again in this country. As time goes on we will see the Government desperately imposing all sorts of bureaucratic controls upon the system and the users of health services in a vain endeavour to reduce the ever-mounting costs of health care. Unless a significant percentage of the population insures for choice of doctor, private hospitals and other ancillary services, we will witness public hospital bed rationing, service rationing and the collapse of private hospitals and private medical practice within a relatively short time. I firmly believe the Labor Government will rue the day it resolved to relive its Medibank ideological dream. Three of Labor's socio-economic measures taken together will cause the Hawke Government enormous problems. The first is Medicare, the second is its attack on lump sum superannuation and the third is its badly thought through imposition of an incomes test on pensioners over 70 years of age and the introduction of an assets means test on pensioners. All will have a confusing and disturbing effect on not only the economy but also the social structure of the community. I do not believe for one moment that either the Minister or the Government can prevent an explosion in health costs in spite of all the technology and all the computers under Medicare without imposing the most draconian and socially unacceptable bureaucratic controls and intrusions into the lives of the average Australian. It will ensure that the Hawke Labor Government remains as it began-a high tax government with no hope and no intention of relieving the taxation on the six million Australians that the Prime Minister promised to relieve. I find it incredible that the Hawke Labor Government has learnt nothing from the failures of the Whitlam Labor Government in its health policy. Mr STAPLES(Diamond Valley)(4.17) —I listened with interest to the speech of the honourable member for Gwydir (Mr Hunt). He spoke of millions and billions of dollars in Australia and Canada. I would like to open my remarks in this debate by speaking not of millions and billions of dollars but of one single dollar. Last week a constituent came into my office, which is not a singular event. There are five children in this constituent's family, three of whom are handicapped. One of those children needs immediate surgery to help overcome the physical and social disadvantages of his disability. That family has an income of $294 a week. Members of the Opposition will realise that this family, on an income of $294 a week, fails by $1 to have the advantage of being classified as a disadvantaged family and hence being eligible for a health card. Had it not been for the generosity of some local doctors, the options for that family would have been, firstly, not to receive medical attention, thus continuing the family 's trauma; or, secondly, to pay out more than $50 a month from the meagre income for health insurance under the current system. I have not just made up this example. Under the current health business one does not need to resort to one's imagination to come up with stories of desperation, hardship and deterioration in people's lives and health. It is there in thousands of Australian homes all round us. It is built into the present health business. I stress the word 'business', because what we have seen develop since 27 November 1975, when Malcolm Fraser promised to maintain Medibank, has been a breakdown of a health care system which was understood and accepted by nearly all Australians. In its place we have had forced upon us a succession of confusing arrangements that have spawned a very lucrative health business. If any government wishes to set out deliberately to create confusion, insecurity, inefficiency and opportunities for fraud and abuse it would find in the health business of the former Government's creation a near perfect model. The former Liberal Government never had and, in opposition, still does not have a health care system or program. It had a health business. Health care in a developed, wealthy nation such as Australia has no right, reason or excuse to be anything but a universal system. It should be a co-ordinated program and an efficient, up -to-date, cost-effective, cost-constraining system. That is what we will have in Medicare. At this time nearly two million Australians are without health insurance or Commonwealth health protection. They are mostly lower middle income earners; the same people whom the Opposition, with its crocodile tears and matters of public importance, pretends to be protecting. It did not protect these people in its time in office-those dark ages of Fraserism. It did not protect the troubled family that I spoke about at the beginning of this speech and the thousands of others like them. It did not protect, by the complexity, confusion and inefficiency of its scheme, the half million other people who are entitled to a government concession card but who are unnecessarily paying for private medical and hospital insurance from their meagre incomes. It did not protect the aged people suffering in sub-standard, rip-off, so-called nursing homes. It did not protect the people who had to defer medical treatment because they could not afford to pay $50 a month for insurance. It did not protect the taxpayers from overservicing and the blatant frauds such as rent-a-patient, doctor kickbacks and the unnecessary radiological and pathological procedures. It did not protect the doctors from an inefficient system for the payment of bulk billing accounts and from the mammoth bad debts that come from the current system. But the sad joke is that the Opposition, because of its hang-ups on 'private enterprise-no matter what the cost', and because of its blind adherence to the perpetuation of the golden rule of Liberalism, which is that whoever has the gold makes the rules, it has not worked out a health care system of its own of any credibility to put to the Australian people. For the edification and enrichment of the Opposition I will highlight the cost advantages and efficiencies of Medicare. The Australian electors do not need Medicare explained to them very much at all. They understand and embrace Medicare as they understood and clearly embraced the original Medibank. The Australian Labor Government has a very clear mandate from the Australian electorate to implement Medicare. This time the obstruction in the Senate of 1974 and 1975 will not hinder its implementation or efficiency. First of all, let us get rid of the ruse that provision of universal health care will encourage overuse of health services. There was an increase in the per person use of medical services in the Medibank years. There was a similar increase in the year before Medibank. There have been similar increases in the years after Medibank, clearly without regard to whichever system was in operation. There does, however, seem to be a correlation between the number of doctors, the number of services delivered and the usage rate. It is suppliers, not users who are the principal determinants of cost in the health business. I am sure that once Medicare is well under way we will see an increase in the number of services delivered, but it will not be because people are using the system just because it is there. It will be because there are thousands and thousands of people in this country who have had to defer medical and hospital procedures because they have not been able to afford private health insurance or because they have not had the dubious advantage of being classified as disadvantaged. The Medicare program contains real, effective cost control measures. It is important in any large socio-economic program as fundamental as a health care system that resources are allocated according to the needs of the people, not just to those who can afford it. We have to ensure that the health dollar is spent on providing the health service to the person in need of the service, not to supporting the inefficient private health insurance industry, fraudulent practitioners and boarding houses which masquerade as nursing homes. By not allowing gap insurance for medical services the Medicare program actively discourages the practice of charge above the schedule fee. At the moment, on average, 28 per cent of patient billed services are billed above the schedule fee. The highest incidence of charging above the schedule fee is in respect of consultations with general practitioners and specialists. Approximately 36 per cent of these services are charged above the schedule fee. In 1980-81 the fees charged for non-pensioner patient billed services were $20, 500,000 above the schedule fee for those services. In 1983-84 this represents $ 27m. Delays in payments of bulk billing accounts will be reduced under Medicare in the new improved system from the absurd six to eight weeks which operates now to one to two weeks because of the simplified, streamlined computer operations and single fund operations. I can hardly wait for the flowers and letters of thanks and congratulations which will come in to my electorate office from all the grateful doctors in my electorate who are now complaining about the delays in the payment of their bulk bill accounts. Doctors and hospitals will have their bad debts virtually removed overnight from 1 February 1984. Medicare will reduce their overheads and administrative costs. Mr Hunt —The doctors will love it. Mr STAPLES —They will love it. The efficiency of the Medicare control systems will mean a greater surveillance of medifraud. Medifraud has been around for years but one could not say that the former Government bent over backwards to do much about it. Considering the millions of dollars it costs Australians-apart from the moral argument-one would have thought that the former Liberal Government would have been a bit more active in stamping it out, but I suppose they were too busy stamping out tax evasion and tax avoidance. Medicare and this Government are prepared to tackle the greedy self-seekers in this nation head on . So it is no wonder that these people are trying to organise what opposition they can. Categorisation of private hospitals will overcome more of the obvious wastage of the current health dollar. Let us face it: Many of these so-called hospitals are really only nursing homes, but they are paid the same rate as acute care hospitals which have intrinsically higher cost structures. It has been a free ride for far too long. The claim has been made that Medicare will not improve the nation's economic health. Let us look at a few salient facts. At a time of severe economic stringency the Medicare program will provide at far less cost to the consumer a comprehensive health care system. A family on average weekly earnings currently paying health insurance will save about $10 a week. That saving will be reflected in the consumer confidence of the nation. The obvious increase in family cash disposable income will help stimulate demand in our economy which is starting now on its road to recovery. While on that road to recovery I am sure that the Opposition will remind us that we have to clamp down on wages, so let us look at the statements of the National Economic Summit Conference communique. In recommendation 48 we read: The Summit notes the announced health policies of the Government and believes that it is imperative that at the Commonwealth level a stable system should be introduced as a matter of urgency. Further, we read: The unions reaffirm their commitment that they will accept an offset in wage increases on account of the health insurance scheme. Five months after that, on 5 August, the President of the Australian Council of Trade Unions confirmed this view in a joint statement with the Minister for Health (Dr Blewett) in reference to recommendation 48. They said: This was a unique and important commitment on the part of the unions, as the ACTU believes that Medicare is integral to any successful Australian wage fixative system. This joint statement, endorsed by the ACTU, continued: Medicare, which will reduce the cost of health cover for most Australian families, is viewed by the trade union movement as vital in reducing Australia's inflation rate. Clearly, there is an acceptance and co-operation of the union movement. Clearly, there is a mandate from the Australian electorate to implement Medicare. The benefits to the nation of a simple, yet comprehensive, cost-effective and universal health care system are quite obvious. It was obvious to the authors of the Hospital and Health Services Commission paper in 1978 entitled, 'Paying For Health Care' who pointed out that under Medibank: . . . it became immediately apparent that the goal of basic universality had been achieved with remarkable administrative efficiency. There are no two ways about it; After seven years of dismantling of Medibank, after seven years of a worsening health care situation, we are entering into a new era in health care for all Australians. Medicare will provide universal basic health care for all Australians regardless of the size of their bank account. It will provide security, simplicity and administrative and cost efficiency for this nation. The major advantages of Medicare are unashamedly directed at the long suffering public. Medicare is vital to the regeneration of our national health, and it is not an exaggeration to say that it is vital to our national recovery. When Medicare comes into operation on 1 February 1984 the family about which I spoke, which is suffering because of an application to it of the arbitral standard of an excessive $1 a week, will be a hell of a lot better off. Mr WHITE(McPherson)(4.31) —I enter the debate by taking up some of the remarks made by the honourable member for Prospect (Dr Klugman). He very generously compared me with General Eisenhower in the delivery and use of health care. I have no doubt that had I stayed in the Services I would have reached the exalted rank of general. But the fact is that, as my friend the honourable member for Bass (Mr Newman), with whom I served in the Army, will testify, I was called to higher things. I was called to this Parliament to take on the socialists in Australia. What we are really talking about today is the socialisation of health care in this country. In case there is any doubt let me make it perfectly clear that I am totally opposed to everything relating to health care that is being attempted by legislation in this House today. This legislation is yet another assault by this Government on private enterprise in this country. We are seeing the nationalisation and the socialisation of the health care services in Australia. One of the most curious of all the arguments put up here today is the economic argument. Attempts have been made to disguise this legislation under some sort of vague economic cloak. I quote: 'Medicare will play its part in economic recovery'. The argument in support of that statement entirely escapes me. What does not escape me is the complete disregard of honourable members on the other side of the House for the escalation of costs that this legislation will cause for the taxpayer in Australia. How the Government has the hide to say that the consumer price index will be reduced by 2.6 per cent by taking this area out of the CPI is quite beyond me. Apart from anything else, if the Government uses that sleight of hand trick all those who depend on proper indexation, such as the pensioners, will suffer considerably. Overall, as other speakers have said, all this legislation, all this ballyhoo, will do not one single thing to improve the delivery of health care to Australians. In fact it is my view that it will lead to a significant decrease. The Government is following along the lines of what happened in the United Kingdom, and I will talk about that in a moment. Suffice to say for now that what happened to medicine and health care in the United Kingdom has been nothing short of a total disaster. It is not without interest, if one goes to the United Kingdom, to see that private health care facilities, private practices of medicos and private hospitals are escalating hand over fist. People in the United Kingdom are fed up with the second rate delivery of health care to them and their dependants. Why, we must ask, has the Government embarked on this course? What are its objectives? Quite frankly, Mr Deputy Speaker, if you talk to some Government members you will find that they are at something of a loss to understand why they are committed to this particular ideological line. I suspect that the honourable member for Prospect, a practitioner himself, to whom I listened with some interest, is one of those people. I think he admitted today in the House that he has considerable doubts about several aspects of this legislation. But some honourable members on the other side of the House are in no doubt. They see Medicare as the supreme example of highly centralised control of Australian medicine. More particularly, they delight in the prospect that it will mean the enforced dependency of Australians on this Government. Honourable members on the other side of the House have this firm ideological commitment-I do not say it is not genuine-to this highly centralist, socialist approach to government. I would like them to give an example, if they can, of any government or semi-government authority doing anything as well as private enterprise. I defy them to give me such an example. There are some very good reasons why we have semi-government authorities. There are some very good reasons for the existence of authorities such as Telecom Australia, for example. They provide services which private enterprise would not be able to provide, but there is no way that they are as efficient. The Government is taking all the private aspects out of the delivery of health care in Australia and concentrating them in this Medicare bundle, which will mean less efficient delivery of services and vastly increased costs. It is beyond me why honourable members opposite insist on devaluing the quality of self-help amongst Australian people. We saw it in the confused thinking about the superannuation legislation which they are bringing down. The tax on lump sum superannuation is a complete disincentive for people to save, take their lump sum and establish themselves in retirement. We see the same dead hand of paternalism in the insistence of the Minister for Education and Youth Affairs ( Senator Ryan) on the destruction of the two school system-the private and public school system-in this country. For God's sake, why would honourable members opposite try to force people to send their children to State schools if they did not wish to do so and if they had the opportunity and wish to pay to send their children to another school? That is an example of what is being done here. Until 1972 we had an effective health care system in this country. There was adequate cover for those who wanted it. Because a percentage of people did not choose to take out health care we turned the whole system upside down to force that minority into some health care system. Until that time the private enterprise system was working well. Then we started fiddling it. I must say in all fairness that when the Opposition was in government we did a bit of fiddling too. I speak with due deference to the honourable member who was the Minister at the time. The latest fiddle will cause the sacking of some thousands of people- probably the lower paid staff members-by the private health funds and the employment of another 2,500 fairly highly paid public servants who are eligible for superannuation. To me that is just no deal. I shall take a few minutes to look at where the doctors fit into this scheme. The aim of the Minister for Health (Dr Blewett)-I would be delighted if he would refute this statement because it is firmly fixed in most doctors' minds-is to make doctors totally dependent on the Government. In other words, they will become form-filling public servants entirely dependent for their income on the bulk billing which, hopefully, will be paid once a month. It is interesting that on a couple of occasions during this debate today when I and others said to honourable members opposite 'You are trying to make public servants out of the doctors', nobody on that side of the House denied it. Nobody said: 'No, that is not what we are trying to do'. In fact, a few Government members have said: 'Yes , that is what we are trying to do. The Government will pay the doctors. They will be our servants'. Dr Charlesworth —It is so ridiculous that we cannot be bothered. Mr WHITE —Someone took up that point before. If the Government does not want to make the doctors of this nation public servants of the Government, why is it virtually forcing them into bulk billing? Why is it not allowing gap insurance so that people can at least take out some extra cover for which they have to pay themselves? Dr Blewett —I thought that you wanted to control costs, a moment ago. There is utter confusion in your economics. Mr WHITE —We are talking about doctors in private enterprise who will be forced into the Government system and who will become entirely dependent for their income on the Government. Why do we not give some encouragement to people who want medical services to make some personal contribution? What we shall see shortly after this system is introduced, because doctors are being forced into bulk billing, is continual checks and interference in their private practices. Already-maybe for some good reason occasionally-we are getting public servants telling doctors certain things. I give an example. In my electorate only last week a public servant, firstly, told a doctor that he was taking too much time with his patients, and secondly, told another doctor that he was seeing too many patients. What sort of judgment is that for a public servant to make on a professional man? That is what will happen more and more. Why does the Minister for Health go around the country telling doctors that he is planning to bring them to their knees? If he has not said that, let him deny it; I shall listen with interest. But that is what doctors in my electorate tell me he is saying. Dr Blewett —They have as big an imagination as you have. Mr WHITE —Let us see what the Queensland State President of the Australian Medical Association, Professor David Weedon, has said about it. I refer to an article in the Courier-Mail of 13 September, yesterday. It states: The Federal Government had begun a 'doctor-bashing' campaign, the Australian Medical Association state president, Professor David Weedon, said yesterday. He warned AMA members that they would be committing 'economic and professional suicide' by bulk-billing the Government for their services. That is what the Government is trying to force the majority of doctors to do. As regards patients, that people on low incomes and the disadvantaged need assistance is not in dispute; certainly not in this debate, and certainly not by me. The problem is that many people will abandon private health care because they already believe that they will be paying enough and that the one per cent levy will cover them for everything. Unfortunately, it will not do that. It will certainly not cover them for private hospital cover. The private hospitals will be under serious economic threat. As other speakers in the debate have said, 30 per cent of taxpayers will be paying more, and certainly that includes two- income families, who will be paying double. Patients will not gain. The delays in public hospitals will increase. They are bad enough in some areas now. I sensed again that the honourable member for Prospect seems to think that in many cases long delay will be the natural cure that will do patients good. I turn now to the United Kingdom. I had the advantage of speaking to a couple of doctors in the last week who have just returned from that country. The health care system there is disastrous. It has been getting worse for some years, and in many respects it has now completely collapsed. People are flooding back to private health funds for cover for treatment and for hospitalisation because they want private treatment and efficient treatment. There has been a dramatic increase in the number of private practices springing up; a dramatic increase in the number of private hospitals, many of which are being financed with American money; and a dramatic increase in the return to health funds run by the trade unions. So that is what they think of the health system there. In the Government systems in the United Kingdom, it is freely acknowledged that the priorities go first to research, secondly to teaching and thirdly to patient care. In short, the system is not delivering. We must ask ourselves why, with all these lessons before us, we are putting in place in Australia the same system that has been so thouroughly discredited in the United Kingdom. Let us take a brief look at the costs of this new system. Taxes will rise by an estimated $1.7 billion, which will inevitably lead to an increase in wages. There are to be an extra 2,500 public servants, as a start. There will be an increase in the number of inspectors and interference in private practices. There will be the loss of private fund jobs. There will be the destruction of freedom of choice. Firstly, there is to be a compulsory levy on all incomes; and secondly, the freedom of choice to take out gap insurance has also been taken away. There will be a temporary reduction in the consumer price index, which will have a dramatic effect on the indexation for pensioners. There will be a penalty on two-income families, a penalty on moderate wage earners, and a penalty on single people. Medicare will have a monopoly, which will inevitably lead to inefficient delivery. There will be pressure on private hospitals and probably the closure of some of them. There will be great pressure, which I believe will lead to further problems, on public hospitals because there will be a certain amount of over-use by patients and obviously a certaint amount of overservicing by doctors. If one is a socialist, one can accept what is being put in place here today; as a socialist one accepts it and supports it and believes that it will be good, and one can justify any arguments in support of it. Many of the speakers in the debate and others on the Government benches are no doubt absolutely genuine in wanting to put this scheme in place, as is, probably, the Minister. But I do not accept that approach. I believe that it is the wrong approach, for all the reasons that I have outlined. I believe that on the Government benches there are many honourable members who, in their hearts, know that it is wrong-wrong for doctors, wrong for patients, and wrong for the Australian economy. I object to it. I want to go on record now as objecting to this system, because I know that it will not be any good. I want to be with my Party when it returns to Government and we take the necessary steps to get rid of a system which is no good for this country. Ms FATIN(Canning)(4.47) —I should like first to respond initially to the honourable member for McPherson (Mr White), who told us of his military career. Obviously, the House recognises that he must know a great deal about warfare, but I suggest that he does not know much about keeping people well and alive. I have worked in the medical field for 25 years. The honourable member defied us to show which government authorities can do better than private enterprise. I suggest that he have a look at cardiology units, intensive care units, renal units and neurological units which are staffed by public servants and by very eminent medical men and women in Australian hospitals today. In reply to the honourable member for Gwydir (Mr Hunt) and others who talk of overservicing, I suggest that while doctors' incomes depend on illness levels, in the community, and not on 'wellness' levels, there will always be a problem with overservicing. As a community, that is something that we should examine. In joining this debate on Medicare, I wish to congratulate the Minister for Health (Dr Blewett) and the Government on the handling of this important program . I also congratulate the Australian Labor Party health policy committees which, over recent years, have had a vision for a fair, universal, equitable, simple and efficient health care scheme for all Australians. This legislation embodies one of the major policies that this Government has placed before the people of Australia and, as was said by the Minister in his second reading speech: . . . for which a clear and unequivocal mandate was received from the Australian people. Medicare is the largest social welfare program we have proposed. It will provide every Australian with a simple, fair and affordable form of health insurance. It is the biggest policy reform the Government will implement in its first year. The Government is returning to the basic principles of the original Medibank health scheme and this return to Medibank principles will restore equity in health contribution rates, universality of cover and simplicity and efficiency of operation. The Fraser Government produced five confusing and contradictory health schemes in the last seven years, and I suggest that Australians and Australia deserved far better than that. Today I should like to speak about two matters relating to health care in Australia. The first is the cost of health care to the individual and his or her family and the second the notion of free choice in medicine. Medicare will make health insurance not only fairer but also affordable to every Australian. Everyone will contribute towards the nation's health costs according to his or her ability to pay. The current scheme of flat rate contribution is unfair. For example, today a family on a low to middle income can pay anything up to $1,000 per year for health cover. A family on an annual income of $40,000, $50,000, $60 ,000 or even $100,000 also pays around $1,000 a year. Whilst nearly two million people without health insurance or Commonwealth health protection are mostly low and middle income earners, the complexity of the current arrangements allows the rich to avoid contributing to the community pool of health dollars collected through the insurance system. For many of those who are well enough off to meet their health bills throughout the year, and with a range of taxation deductions available through a careful arrangement of their financial affairs, health insurance is an unnecessary waste of money. Spared the cost of insurance premiums, they also know that the majority of their health bills will be refunded through the taxation system. In contrast to well off people, I example an elderly couple in my electorate who, after a lifetime of hard work, now receive monthly superannuation payments not much higher than the age pension. Because they are not recipients of the age pension they are forced to pay private health insurance. They contribute $900 per year to receive hospital and medical cover. If they did not do this they could face enormous health bills should they fall ill. In a fair society this elderly couple would not have to pay this exorbitant amount for health cover. Of course, after the introduction of Medicare on 1 February next year they certainly will not have to. They will pay a one per cent levy on their taxable income, just as most income earners in Australia will. Of course, some low income earners will not pay the Medicare levy. The income threshold below which no levy will be payable is $128.80 a week for a single person and $214.25 a week for a married couple, increasing by a further $21.15 a week for each dependent child in a family. Medicare will provide the same entitlement to basic medical benefits and treatment in a public hospital to every Australian resident regardless of income. This universality of cover is obviously desirable from an equity point of view. In a society as wealthy as ours people should not be putting off treatment because they cannot afford the bills. Basic health care should be the right of every Australian. I know from personal experience and from looking at statistics that thousands of people in Australia, and a significant number in my electorate of Canning in Western Australia, daily risk high medical bills and exorbitant hospital costs by not taking out private health insurance. They are taking a chance on not becoming seriously ill or being involved in a serious accident. They simply cannot afford to pay health insurance so they take a chance. In fact, they gamble with their health. Other Australians who are ill and in need of care decide not to consult their doctor for fear of the need to be admitted to hospital and such people have visited my electorate office. Hospitals are simply places they cannot afford. None of this should happen. These examples of financial hardship, risk with health and untreated illness all point to a fundamental fault in the current health care scheme, and that fault is the principle of user pays. As a registered nurse of 20 years standing and as a worker in preventative medicine, I have seen Australians ashamed to admit their poverty, ashamed that they carry a health care card, ashamed by their misfortune , and ashamed of what they see as handouts in the medical field. After 1 February 1984 this will no longer happen. Medicare will provide the means for all Australians to have eligibility to a dignified universal health scheme. I now move to my second topic of discussion, the notion of free choice in medicine. It is my view that a lot of nonsense is talked about how a patient's right of free choice will be denied after the introduction of Medicare. This free choice relates to the choice of doctor. Under the provisions of Medicare a patient may freely choose his or her general practitioner, just as happens now. In fact, no one will interfere with that choice. I add as an aside that many people in remote areas in Australia never have the choice of one doctor or another. They consult the one doctor available or go without medical care. After choosing a GP a patient may need a referral to a specialist. Mr Deputy Speaker, I think you will agree that very few patients tell their GP which specialist they should see. Of course, if a patient is able to recommend a specialist, it is not Medicare which will decide whether that specialist is chosen, but the GP who makes the choice, for it will be he or she who writes the referral. All radiology, pathology and other diagnostic services provided by a doctor will be covered by Medicare. General practitioner consultations, visits to specialists, and the services just mentioned will all be covered by Medicare and freely chosen by the patient and his or her doctor. It is nonsense to suggest otherwise . Let me now deal with hospital care, the area about which I consider that most dishonest debate takes place in terms of freedom of choice. Medicare will entitle patients in hospitals to free treatment by hospital doctors and accommodation in a public hospital. The kind of ward allocated will depend on the hospital's assessment of the patient's medical needs. Of course, that happens today in hospitals. I think it is worth while pointing out what freedom of choice in this area of health care really means. At present, even if a patient has whatever insurance he or she may want, or even if a patient pays maximum insurance, he or she rarely gets freedom of choice, if at all. Certain specialists do not operate on given days and ruptured appendixes cannot wait. Some specialists do not visit certain hospitals, and the patient's local hospital may very well be one such hospital. Doctors go on holidays, on leave overseas, and many such things. I assure this House that it is a rare occasion when a patient chooses a specialist or sub-specialist. Most often he is told who is the best man or woman for the job and he accepts that advice. Most people rely on their GP for referral, and it is the GP's choice, not the patient's. I would like to state further that if doctors believe that the patient should have freedom of choice it can be made available, but it has nothing to do with the payment system, in this case Medicare. Doctors, if they choose, can operate on patients in hospitals as hospital patients and get sessional payments and many eminent surgeons do this today. It is up to them whether they choose to allow or not to allow patients to have this freedom of choice. This choice depends on doctors' attitudes, and in the future we may see the current attitudes change. Presently most people when ill or requiring elective surgery leave the choice of doctor and hospital to the doctor. Much of the public debate which has gone on about this choice is nonsense and scaremongering. Most people involved in such debate do not know what they are talking about or, for financial gain, wish to direct patients by suggestion. The passage of the Medicare legislation is of the utmost importance to this Government. It is, as I said earlier, the largest social welfare program that we have proposed because it provides every Australian with a simple, fair and affordable form of health insurance. I firmly believe that Medicare will be the most popular social program of the Hawke Government and I am proud to be associated with it. Mr NEWMAN(Bass)(5.01) —I begin my contribution to this debate by taking up the remarks of the honourable member for Canning (Ms Fatin) when she began her contribution. She referred to my colleague the honourable member for McPherson ( Mr White)-a professional soldier who has campaigned to defend this country, including I presume people such as the honourable member for Canning, as have other soldiers, sailors and airmen who are just across the way. Her remarks are beneath contempt. This is a very significant debate. It is significant because of the changes that the Health Legislation Amendment Bill and the other three measures which we are debating cognately will bring to health care delivery and the problems which , I believe, they will cause. They are bad enough, but this debate goes far beyond those issues. The debate is a necessary one and that is why many of my colleagues are joining in it. I do not think the people of Australia realise the very fundamental changes which this legislation will bring to their way of life. In the last six months this Government has carefully nurtured and projected a very conservative image. It has been very cleverly done, by devices such as the National Economic Summit Conference, by so-called consensus politics and by a soft Budget. However, this legislation reveals the Government's true colours. It is socialist legislation, introduced by a socialist Government. As all the speakers on this side of the House have pointed out, it will nationalise a large part of the health care services of Australia. It worries me that so few people in our community realise what this Government is up to. They do not realise because so far in public comments or public debate many of the people who might speak in our community have been foxed first of all by the excellent propaganda of the Government. They have been foxed by the compliant Labor governments that exist in the States around Australia. They have been silenced by the not too subtle blackmail of people such as the Minister for Health (Dr Blewett), who is at the table. After listening to the contributions that members of the Government have made to the debate today in a naive belief of what all this means, it is clear that they simply do not understand the ramifications of the Bills which they are defending today. This legislation will change the way health care is delivered and it will change the way in which it is received. Unfortunately, it is legislation which will result in poorer health care. Why do I say that it is socialist legislation? Let me pick out some of the characteristics of the legislation. First and foremost, it will severely limit the ability of health care consumers to choose, despite the rather specious and stupid arguments of the honourable member for Canning. A great number of Australians will be led to rely more and more on the state for their health care . Secondly, medical insurance business will be channelled practically exclusively through the Government monopoly, Medibank. Policy, administration and decision making will be concentrated in a large and centralised bureaucracy. Thirdly, doctors will be pressured and finally forced to bulk bill. Again, as my colleague the honourable member for McPherson so properly put it, eventually Australians will be totally dependent on the Government. Fourthly, private hospitals will be squeezed because of the reduction of fair competition between the public and private hospitals. Fifthly, the Medibank levy will result in a very large covert redistribution of income, and from taxpayers who are already paying large amounts of tax. Finally, there is the false representation that it is a scheme paid for by the levy when in fact, as the honourable member for Mackellar (Mr Carlton) pointed out right from the very beginning taxpayers will have to pay extra taxes over and above the levy to pay for the scheme. These are just general points about the characteristics of the legislation. I will go into some specifics and pose some questions for the Minister because there is confusion about what this legislation means. I refer first of all to costs. It has been established by the honourable member for Mackellar that the cost to the Federal Government will be $1.7 billion, only one-eighth of which will be covered by the levy, and the total cost to the States will be of the order of $8 billion. What I do not understand is how the Commonwealth Government is going to meet the costs, to the States particularly, on the assumptions that it has made. I understand that one assumption that the Minister has made is that the cost of hospital care will average out at only about $300 per family of four . As I understand the Tasmanian costs, they will run at something like this for the financial year 1983-84: This year hospital services are budgeted at $130m. There are 420,000 people in Tasmania, so that works out at about $300 per person , not $300 per family. For a family of four the average cost is $1,200. If the Minister's calculations of costs are right, how does he marry that figure with his assertion that the average cost will be $300 per family? If my figures are correct, we have only three choices to make: The State will pay more-and that will be a burden on Tasmanian taxpayers-the Government will have to increase the levy, or the Government will have to increase taxes to cope. Perhaps more of a worry to Tasmania, other than those basic costs which I would be glad to hear the Minister clear up, is the effects of the States (Tax Sharing and Health Grants) Amendment Bill (No. 2) 1983. In the explanatory memorandum on that Bill, the Minister said: In order to participate in the Medicare funding arrangements, South Australia and Tasmania have agreed to terminate their hospital cost-sharing agreements with the Commonwealth with effect from 1 February 1984. The Minister must know that that statement is quite dishonest, that that is not the situation at all. As I understand it, Tasmania as late as just a few days ago but certainly in a letter on 16 August quite clearly pointed out to the Minister, to the Government, that it had not agreed to terminate that arrangement as the Bill stated. If that is the case, what does the Minister intend to do about that? How has he calculated his Budget if he does not know what arrangements he has to negotiate with Tasmania? How can he predicate any of his assertions about the levy or future tax arrangements if he does not know what he is up for in at least one State-Tasmania? Perhaps he could clear up that point as well. The honourable member for Canning, the honourable member for Canberra (Mrs Kelly) and the honourable member for Deakin (Mr Saunderson) have all commented on the question of cost to the average income earner. The proposition that they put to us is that the average family, on average income, will have its health costs reduced to about $350. Of course, this covers only the basic provision of Medicare; it does not cover the family which wishes to insure against costs incurred in having a doctor of its choice and going to a private hospital. The Minister has said that the figure for basic hospital cover will be $5. My colleague the honourable member for Mackellar has already made it clear that on his information this could be as much as $7 or $8 a week. I corroborate that assetion. Could the Minister please clear this matter up? On what basis does he say that $5 a week is the hospital cover for insurance purposes on the basic rate? I was informed as late as several hours ago by several health funds in Tasmania that they will not be able to do this-of course it is not clear yet, because again this is an area of some doubt. It is clear from their calculations on what they do know that they will have to charge $7 to $8 a week in Tasmania. So that bears out the information that the honourable member for Mackellar put to the House this afternoon. It certainly makes a nonsense of the sort of proposition that has been put by those members I mentioned. If the average family wishes to continue to have not only cover for medical services but also proper hospital cover so that it has a choice, it will be up for about $10 to $ 12 a week. The proposition put to us by the honourable member for Canning is absurd. She referred to a couple on superannuation paying $900 a year for cover. That is just not so and she knows it. On that basis that couple must be getting the very top insurance cover so they will also be in the same position. If they wish to cover themselves over and above Medicare the insurance cover will cost them more on top of the one per cent levy. So there are some questions in regard to costs. On the question of doctors- Dr Theophanous —You were never any good at figures. Mr NEWMAN —It will be answered by the Minister. We are putting it on the table; let him answer it. The honourable member may be able to answer it in his contribution to the debate. As to the question of doctors, we believe that the way in which the Government is tackling this matter is a deliberate effort to pressure the doctors to bulk bill. That means that in their practices they will be down by somewhere between 5 and 15 per cent of their income. This will be accepted by the honest doctors, I have no doubt. But for the Minister to assert that the doctors will be able to save some of this money, because of the savings that will occur from less administration, fewer bad debts and so on is just not true, because all the doctors I talk to point to the problems that they will have in administering the new scheme. Some of them now have several secretaries doing nothing else but trying to cope with the administration of the existing system, let alone having to cope with the system that the Minister will produce. Dr Blewett —Because it will be so much more simple. Mr NEWMAN —I am not trying to defend all the aspects of the scheme that exists. The honourable member for Mackellar pointed out some of the disadvantages of it. Dr Blewett —That is the problem. Mr NEWMAN —This is the problem: The administrative burden they will have, I assert, will be more than they have now. Dr Blewett —That is utterly untrue. Mr NEWMAN —This is what most doctors believe. It is certainly what doctors are telling me at the moment. Dr Blewett —And telling each other. Mr NEWMAN —The Minister is only putting a point of view, the doctors are putting a practical point of view. I would like to hear why the Minister says it will not be so. I would be very happy to hear about it. Whatever the argument is about administration, the problem that arises is: How are doctors going to make up for the 5 to 15 per cent drop in income that they will suffer? As I said, the honest ones will cope by just getting on with the job. But as the record shows- the honourable member for Canberra was talking about the Joint Committee of Public Accounts, which looked at the overservicing problem-one of the ways the doctors will cope is to overservice. They will overservice. Mr Chynoweth —Greedy. Mr NEWMAN —Yes, they will be greedy; but we know there are doctors like this. I wish to ask the Minister what his magic solution is for improving the situation. He has talked about $8m going into the system to detect this sort of fraud, but in the practicalities, in the nitty gritty, how will he do it? If he intends to do so by checking on the profiles that presently exist, he knows as well as I do that the profiles are available only in the case of doctors who really get into the system. Those who approach that point are not picked up at all because there are simply no ways, means or resources to chase them. Those doctors who will increase their servicing to make up for that 5 to 15 per cent drop in income will not be caught within the existing system. Again, I ask the Minister another question: What will he do about that? I refer now to the question of public hospital use. This is fairly important. Again, as I understand it, the Minister has said that he believes that there will be a shift of around 2.2 per cent from the private system to the public system. Dr Blewett —No. Mr NEWMAN —That is not so. The Minister might tell us what he is calculating. As I understand it, State authorities and State governments are calculating 2.2 per cent as the accommodation they will have to make because of the shift to public hospitals under Medicare. I put it to the Minister that that is a very modest calculation. In Launceston, on checking with a wide cross-section not only of doctors but also of medical administrators and hospitals, they are calculating that the shift could be as much as 20 or 30 per cent. If this is the case how will public hospitals like the Launceston General Hospital cope? The honourable member for Prospect (Dr Klugman) was talking about the queues which now exist in some hospitals. He was concentrating particularly on ear, nose and throat operations or perhaps plastic surgery which we all know causes queues in the public hospital system. A check this morning revealed, for example , that at the Launceston General Hospital the waiting time for such surgery as a gall bladder operation is up to two or three months while for hip operations it could be over 12 months. That is the position now. What will happen when the system gets over-loaded if the shift of somewhere between 20 and 30 per cent occurs? How in heaven's name, under the new system of Medicare, which will encourage people to make that shift, will a public hospital like the Launceston General Hospital be able to cope? There is no way it will be able to cope. In passing, I ask the Minister what he will do about the Launceston General Hospital because he well knows that it is an uneconomic, inefficient hospital because only stage 1 has been completed. We have to move to stage 2. As I understand it, the Minister is saying that no more funds can be given to the State or that no agreement can be reached until the whole question of the rationalisation of bed space in the north of Tasmania can be realised, when his colleagues in the Labor Opposition in Tasmania are saying that there is no way that any beds can be taken away in the north of Tasmania. It is a dilemma which he has posed. I would be interested to hear today what the Minister will do about providing a local general hospital which will be able to cope with his systems. Because of the shift I have just described and because of the hospital' s inbuilt inefficiency as it is not finished, I want to know what the Minister will do about stage 2 of the financing of that hospital. I now move to the question of private hospitals. It is said by the Opposition that the competition available between private and public hospitals will be reduced by the arrangements which the Minister will put in place. I believe that that will be so because it is a worry as to whether people will insure for private hospital cover when they realise that they will have to pay an extra $7 or $8 a week to do so. More than that, there is the question of the categorisation of private hospitals. So I ask the Minister another question which he may be able to answer and settle. He would be well aware that in Tasmania at least-but I have no doubt it occurs all over the country-a number of private hospitals and organisations are very worried about the category in which they will end up. As I understand it, the principal private hospitals in, say, Launceston will end up in category B. Are these figures correct or not? The Minister may be able to clear them up now. One hospital charges $130 a day for a shared private ward. As I understand it, if someone takes out the basic insurance cover he will get $100 from the insurance company. The Commonwealth will pay-in this case a category B hospital-$28. If that is so, what will happen to the gap which, for a medical patient will be $16 a day or for a surgical patient, $18 a day? In the case of surgery it will build up as well because of operating theatre fees. I am just backing up what the honourable member for Mackellar said this afternoon in this debate. There is a gap of somewhere between $18 and $30 per day in a category B hospital if it charges $130 for a shared private ward. That is quite a different picture from the sort of picture painted by Government members when trying to describe what a beautifully equitable system this is. If that is true, it simply is not fair. It will certainly be a great expense on the system. There are more things I could say on this matter. Hopefully, when we get to the Committee stage, we will be able to go into some more detail. I have tried to put some of the problems which are being debated but are not being answered properly in the community. I conclude on this point: I believe that the Government will rue the day that it introduced this new Medicare policy. I believe these Bills mean that there will be a poorer health service in this country. The levy which the Government has struck will not cope with the escalation in the years ahead. The Government will either have to increase it or it will have to increase taxes to cover the gap. I hope the Government members will read their speeches in a year or two and see the nonsense which they spoke. These are silly Bills. Dr CHARLESWORTH(Perth (5.21) —We really have had a plethora of falsehoods and dishonest innuendo today, and there were no better contributions in that regard than those which came from the two soldiers we heard speak in this debate. The honourable member for Bass (Mr Newman) suggested that we on this side did not understand the ramifications of the Medicare proposals. But for the monumental blunder of the former Prime Minister on 3 February I would still be practising medicine. I believe I have some experience which is relevant to this issue. The honourable member for Warringah (Mr MacKellar) said that he was concerned about a massive migration of free-loading sick people. That statement is laughable and absurd and is clearly an indication of the standard of debate on the other side of the House. The red herrings have been coming thick and fast from the other side of the House. The honourable member for Gwydir (Mr Hunt) talked about percentage increases in the range of 90 per cent under the original Medibank scheme. I must admit that I get really angry when we hear these isolated facts. If honourable members want some isolated facts here is one: The latest Fraser health scheme- the fifth scheme-introduced on 1 September 1981 resulted in a massive increase in bed charges in public hospitals from $50 a day in August 1981 to $110 a day in September 1982. That was an increase of 120 per cent in 12 months. Honourable members opposite want to quote isolated facts! The honourable member for Gwydir suggested that there would be a collapse in private hospitals. Again honourable members opposite choose to ignore the facts. Bed occupancy during the year of the original Medibank scheme was 319 bed days per 1,000. Last year the bed occupancy rate was 292 bed days per 1,000 in private hospitals. I am afraid the facts do not concur with the comments we have heard. The honourable member for Mackellar (Mr Carlton) is concerned about fraud and overservicing. He must have a very low opinion of the medical profession and the people of Australia. He sees doctors being unable to resist the temptations that will be put before them. He suggested that they are greedy rip-off merchants who are waiting-champing at the bit, so to speak-to make huge profits. We on this side of the House do not subscribe to the view that the honourable member for Mackellar holds, but any government would be delinquent in its duty if it did not intend to pursue criminal fraud and overservicing. The honourable member for Mackellar cried tears of blood for pensioners. He suggested that they would be queueing in doctors' surgeries. Perhaps he is suggesting that a number of pensioners will finally have health care available to them at a reasonable cost. Present indications are that more than 352,000 pensioners in this country are without fringe benefits that entail health care. The new proposals will make health care available to pensioners in those circumstances. I could go on talking about things that members on the other side of the House have suggested. The Government's policy-it is tied up in this legislation-is not reactionary and not ad hoc; it is well conceived and it has been well presented. Only one political party in this country has not hidden health policies when elections have come around, and it is the Australian Labor Party. Health policy has been a major plank in our Party's platform. The full details were available for more than a year before the election, and they were responsibly amended during that time. Discussions and negotiations with interested parties have been going on ever since the election. This of course is in sharp contrast to the previous seven years when the Opposition avoided public debate and scrutiny of its health schemes. In government the Opposition made changes that were swift and ruthless. In 1976 the changes to health insurance were accompanied by a unilateral statement that agreements that had been negotiated with the States with regard to cost sharing were invalid. The State health ministers first heard of the quite dramatic changes to the present health system in 1981 when they were announced in the Federal Parliament. The thrust of this legislation will, I hope, finally lay to rest the health care debate in this country, a debate which has for too long centred on health insurance. Hopefully, the fundamental issues of access, equity , efficiency and accountability will be resolved and discussion will then be centred on the role of prevention and the setting of health priorities. The Medicare proposals will move the Government's role to one of balancing its social and economic objectives in a cost-effective and efficient manner. The former Government had great difficulty assessing its health care objectives . The cornerstone of the Labor Party's policy is its social objective of universal cover. We believe it is a right and not a privilege for people in this country to have health cover. Indeed, the former Government's discussion paper in 1978 entitled 'Paying for Health Care' stated: In view of its acceptance and theoretical advantages it should be regarded as a permanent feature of health financing in Australia. I am talking about universal coverage. The paper went on to state: Under Medibank it immediately became apparent that the goal of basic universal cover had been attained with remarkable administrative efficiency. The Labor Party opposed the amendments made in 1981. Indeed, in June 1981 the present Minister for Health (Dr Blewett) made the following chilling predictions : On pre-1975 expectations, at least one and a half million Australians will remain uninsured. If the conditioning of recent years has had any impact that figure may be considerably larger. He went on to outline those people who would be uninsured, and, again with commendable accuracy, he included in that group those who were unable to afford expensive flat rate insurance, those who took risks with their health, those who gambled with their health, the feckless and the confused. Certainly, the policies of the previous Government have been very confusing. It chose to ignore its advice and embarked on a number of programs of short term expediency. The off-shoot was that 2 million Australians were without health insurance, as was so ably forecast by the present Minister. On top of that, the present scheme asks low income earners to pay a much higher percentage of their income than other income earners pay. It is inequitable and regressive. Thankfully, this package of legislation, with its universal coverage and an income-related levy, will redress the socially abhorrent aspects of the present scheme. The next matter we turn to during the health debate is economics. We have heard all the Opposition's arguments before, and it has trotted them all out again today. They talk about the private enterprise panacea-the cure-all. Health is not a perfect market. Unfortunately, or fortunately for whatever the reasons, the suppliers dictate the usage of health care and not the consumers. Therefore the promotion of a free enterprise health system as the most efficient, unfortunately does not carry weight. This idea has been promoted to the extent that even the medical profession has come to believe it. I shall quote from a speech made earlier this year by the retiring President of the Western Australian branch of the Australian Medical Association. I suggest to all honourable members that the AMA is not a hot-bed of socialist or left wing doctrine. The President said: I am continually surprised to learn that many of our profession do not know that for every dollar paid out by a benefit fund for a medical service 30c is supplied by the Federal Government. It is unreasonable then that the Government, or the benefit fund for that matter, should not want to know where every cent of their money is going. The United States has traditionally pursued a free market health care scheme. Only relatively recently has the Government in that country assumed responsibility for disadvantaged people through its Medicaid and Medicare schemes. Despite the pursuit of a competitive health scheme in that country, the bastion of the free enterprise market, the cost of health care continues to rise in quantum leaps. If we look at the figures we see that health care increased by 15 per cent in that country during 1981. As a percentage of gross domestic product the figure was 9.4 per cent in 1980. But across the border in Canada, where there is a universal, publicly funded scheme, as a percentage of gross domestic product 7.3 per cent was spent in 1980. I am suggesting that health schemes, such as the one that exists in Canada and which is in parallel with the scheme the Labor Party is wanting to implement in Australia, contain costs. Cost containment in Canada stems from effective government control on the supply, demand and cost of health care. Centralised administration of Medicare will lead to cost containment. While at present administrative costs consume $1 in every $ 10 in Australia, the administrative and advertising costs consume $1 in every $ 25 in Canada. Mr Deputy Speaker, I suggest to you and to all honourable members opposite that this legislation represents a milestone in health care. I hope that its passage will enable us to put the health insurance debate behind us and to concentrate on reassessing and examining other priorities in the health area. Prevention, health education, research and industrial health are just some of these pressing problems. This legislative package will help to achieve the social objectives of accessibility and equity. The economic aims of efficiency and accountability will also be achieved. The legislation will represent an important part of the social wage concept which is fundamental to the prices and incomes accord. Therefore, I commend the Bills to the House. I support them and I congratulate the Minister for Health on presenting them. Mr ANTHONY(Richmond-Leader of the National Party of Australia)(5.33) —The legislation before the House is bad legislation. It is repugnant legislation. It is legislation designed to destroy what has developed into one of the best health schemes in the world. It is legislation which will force on Australians a massive weight of officialdom and bureaucracy. It is legislation which offers the gravest possible threat to the right of all Australians to the best health care. For these reasons the National Party totally opposes this legislation and fully supports the amendment moved by the honourable member for Mackellar (Mr Carlton). The Minister for Health (Dr Blewett) no doubt believes that he will be remembered as the architect of Medicare. I can assure him that he will be! But if this legislation becomes law he will not be remembered fondly. As the nightmare he has produced takes shape, consuming more and more of the nation's resources and steadily eroding the integrity and efficiency of the nation's health services, his role in this sham operation will be remembered with bitterness, anger and shame. I say that this is a sham operation because that is what it is. The Minister for Health and the Australian Labor Party generally have paraded Medicare as a badge of their concern for the sick. It is nothing of the sort. Like its father, Medibank, Medicare is nothing more than a device for foisting on Australians the big government, anti-free-enterprise philosophies of a socialist government. Those philosophies were exposed as the failures they are by the Medibank experiment. Even in the relatively short period of its operation one would have thought that a Labor government would have taken note of its effect. Health costs mushroomed, fraud exploded and government interference spread throughout the health system. The Labor Party, which has learned nothing and forgotten nothing, now wants to do it all again. This legislation has one aim and one aim alone. It does not improve the health care available to Australians. The aim of this legislation is to bring the entire medical system-the medical profession, the hospital system and the ancillary services-under the control of the Government. It is the aim of this Government to ensure that it controls, directs and funds every facet of this nation's health care system. The standards of that system and the care it offers Australians are very much a secondary matter. To achieve this aim the Labor Party has maintained for many years a campaign of denigration against the medical profession. It has tried to arouse envy in people by attacking the earnings of doctors. It has tried to attack the integrity of doctors by smearing the profession as a whole for the regrettable failures of a few. It has tried to stifle their self-respect and the respect in which they are held within the community by putting the blame for rising health costs on the shoulders of the medical profession alone. In this campaign of denigration the Labor Party has been able to gather a number of allies. The envious and the dissatisfied have rallied to its flag, along with others within the health care system who have seen personal advantage from pulling down the position of doctors. Of course, there have been the front groups such as the so-called Doctors Reform Society which has suffered a savage blow to its credibilty since its chief mouthpiece gained preselection as a left wing Labor candidate in Sydney. I just note in passing that, despite the general willingness of the media to accept Labor's claims in this area as gospel, the general public regards them as rubbish. In any survey of public regard for various occupations, doctors mostly rate first or second. Politicians are well down the list-usually just ahead of trade union leaders and journalists. As a former member for Riverina once said in this House: 'He who throws muck, loses ground'. However, the medical profession has not been Labor's only target. It has also gone after the two other vital components of an effective, efficient health system-private health insurance companies and private hospitals. It has done so because the continued existence of private health insurance and private hospitals alongside the cumbersome, inefficient and costly government-run system demonstrates the failure of the government system only too clearly. Of course, it is too much to expect that a Labor government and a Labor Minister for Health would regard this situation as a stimulus for improving the Government's side of health care. They do not. Instead they see it as a good reason for destroying private health care because, for as long as it exists, people can see how the Government's systems are failing them. The Government's decision to give Medicare a virtual monopoly in health insurance is clear evidence of its commitment to destroy private health care-as is its insistence on discriminating against private hospitals for the payment of benefits and its determination to force bulk billing on as many doctors as possible. This Labor Government, so proud of its commitment to reversing unemployment, is quite prepared to throw 5,000 employees in the private health insurance firms out on to the street, knowing that only a fraction of them will get jobs in Medicare. The Government is doing this in order to create a virtual monopoly for Medicare. It is happy to put enormous financial pressure on hospitals knowing that many of them will fold and, with them, the essential services they provide, especially in country areas, in order to create a virtual monopoly for government-run hospitals. I can illustrate that problem clearly by referring to the Victorian Bush Nursing Association which has 38 hospitals spread throughout the State, 15 of them, incidentally, in Labor electorates. Because of the discrimination on insurance proposed by the Minister for Health, 34 of those hospitals will be in severe financial difficulties within a matter of months after Medicare is introduced unless their patients are prepared to pay up to $50 a day-a cost which, under Medicare, they will insure against. The lack of concern by the Minister for Health for this potentially disastrous situation for country people is shown by the fact that he has refused to see representatives of their Association. A copy of their submission on Medicare to the Minister was misplaced by his Department. There could be no clearer indictment of the shallowness of this Government's claim of concern for the health of Australians. The problems facing Victorian country hospitals because of Medicare will flow on to many people in many regions. There will be similar pressures on private hospitals in country areas in all States. There will also be pressures on individual doctors who have had the enterprise to provide specialised medical services for their patients in country areas. In many cases, discrimination in insurance available to these patients will means that these specialised services will no longer be available. Patients will then have to travel long distances to central public hospitals. Does this mean better health care for country people? Of course it does not. The third of the three elements of the Government's attack on private health care, to which I referred, is the attempts to force doctors to bulk bill. This is a key element in its strategy. It will have two effects: The first is to steadily reduce the independence of private medical practitioners to a stage where the Government is able to bring them under its control; the second is to open the floodgates to cost increases and fraud. If the Government succeeds in its efforts to promote bulk billing it will eventually be providing the total income of all but a few private medical practitioners. When this occurs, the Government will be able to argue that as it is paying the doctors it has become the doctors' employer. When it has become the doctors' employer the doctors will come under the total control of the Government. It will set their salaries and tell them where to work and how to work. This will not happen immediately, but it will eventuate with socialist administration. The renegade doctors will be left out in the cold. If they do not work for the Government their patients will have to pay to consult them while Government doctors will be free. The Government can argue that its system still does provide for private medical care, but the fact is that it will destroy a system which is respected and understood by all Australians and replace it with one that has been discredited in countries around the world where it has been tried, all for the sake of imposing its socialist philosophies on the Australian people. Bulk billing under Medibank Private corrupted some doctors and made possible the fraud that we saw begin in those days. This fraud has been rightly and properly condemned. These doctors who took part in it deserve no sympathy. But even with limited bulk billing that does exist now for pensioners there is the possibility for this abuse to take place. But fraud and abuse of medical services is obvious particularly when it is going to become universal. A bank that puts the contents of its safe out into the street for every passer-by to sample cannot escape blame if its money is stolen, nor can the Australian Labor Party escape blame for making possible fraud on the scale which I have been suggesting. As well as making fraud more easy, bulk billing will mean that every brake is taken off financial restraint both by doctors and patients. Patients, knowing that whatever happens they will not have to pay, will have no reason not to demand and receive unnecessary services. Doctors will have no reason for denying them that service. This will only be magnified by the so-called free hospital care. The Government tells us that everything will be free under Medicare. Of course it will not. Nothing is free. We may not have to pay the doctor or the hospital, but we will have to pay the tax man and we will have to dig pretty deep. The Government is proposing a one per cent levy on incomes to meet its costs. But this levy, like the whole Medibank scheme, is a deception. The total cost of health care in Australia is about $8 billion a year and will increase substantially under Medicare. The proposed levy will raise about $1 billion. So it will bear no relationship to the real costs of health care. Those costs, as always, will have to be paid, and they will be paid by the taxpayer. He will be paying much more than the one per cent levy, which is only just the beginning. Many aspects of Medicare proposals deserve censure. They have been amply dealt with by speakers on this side of the House and by other speakers who come forward and feel so strongly about the grossness of the scheme that is being presented. Today I am trying to warn Australians about the path down which this Government is leading them with this legislation. It all sounds so very easy to say that it is a simplified means of paying for medicine, but it has great ramifications. It is a backward step which all Australians will live to regret because it takes away part of their freedom and erodes health services and standards. With greater demand on public hospitals, long delays and waiting times for admittance and operations will become the order of the day. I will quote from a speech to the Joint Sitting of Parliament on 7 August 1974 by Senator Dame Margaret Guilfoyle which I believe is very timely today. She said: It has been stressed in a cliche that health care is a right. Surely health care is a responsibility. Surely it is a personal responsibility, and it is for each and every one of us for ourselves and our families to accept that resonsibility; but surely it is also a responsibility that should be shared by Government. We do not want a Government takeover but a sharing of responsibility between Government and community. Senator Dame Margaret Guilfoyle also said: The public interest is the interest of every individual in Australia. It is not a collective thing. We are not a collective mass. Each and every one of us is an individual with personal responsibilities to assert. When they are usurped by Government, we have no public interest, we have no private interest; we simply have a government which takes all. Those words are as true in their warning today as they were in 1974. It will be only a matter of time before it becomes obvious to Australians that they have made a great mistake in accepting so calmly the consequences of this legislation . It will lead to poorer health services in this country. As one who represents the great rural areas of Australia, I feel very sad that rural people will suffer the consequences, probably more than most, because the standard of services will decline. These people will be obliged to travel much greater distances to get a service at a public hospital. They may have to wait in a queue for a long time before they are seen to. The National Party rejects this legislation for all it stands for. I hope many people in Australia will stand up and express their abhorrence as they analyse the legislation more closely. Mr SAUNDERSON(Deakin)(5.50) —I support the Health Legislation Amendment Bill, the Medicare Levy Bill, the Income Tax Laws Amendment (Medicare Levy) Bill and the States (Tax Sharing and Health Grants) Amendment Bill (No. 2). I applaud the Minister for Health (Dr Blewett) for doing a fine job in putting together the Medicare proposal. For the first time in eight years Australia will have in February 1984 a national health scheme which will provide universal cover for all. We have seen a number of changes since members of the previous Government set about destroying Medibank within only about 10 months of its inception. They promised that they would maintain it and keep it. But what did they do? They were elected in December 1975 and in June 1976 they made their first announcement to change the way that Medibank operated. The previous speaker for the Opposition, the Leader of the National Party of Australia (Mr Anthony), said that the health care system at the moment is the best in the world. Let us look at how it became, in his view, the best in the world. A number of changes were made by the Fraser Government during 1976 and I have a list of some of the changes in chronological order. I do not know whether I have been able to pick up all of them because there were quite a few. It announced some changes in June 1976 and in July 1976. In August 1976 more changes were announced. In June 1977 and May 1978 more changes to the health scheme were announced. I should have thought that that would have been enough, but there was more to come. More changes were announced in August 1978, November 1978 and May 1979. In June 1980 and April 1981, yet again, more changes were announced. One would have thought that by that stage members of the previous Government would have achieved a system that operated, but they instituted another government review in 1980, and in January 1981 a report was brought down . I will refer to only two of the recommendations. There were 140 of them, indicating how wonderful the system was, even after the 11 changes I have been able to find had been introduced. The first recommendation was that the Commonwealth must set its objectives in the health field by clearly showing what it intended to do and on what conditions. That recommendation indicated that, with all the changes that had taken place, nobody knew where they stood. Obviously, the previous Government did not know. Another recommendation was that a working party be established by the Government-that is, another working party; one wonders what this one was supposed to be doing-to devise a new health insurance system which satisfied the principles of equity, freedom of access, and payment by those able to afford it and which promoted universal participation. The then Government must have looked at the proposition we had in opposition because that is exactly what we are proposing to do under the Medicare scheme. Members of the Opposition-a bunch of mismanagers-set up a confusing, fragmented , expensive, disjointed health scheme during their eight years in government. They were able to drive people away from the health insurance scheme because they could not afford it. Under Medibank, during 1975 and the first part of 1976 we had developed a system whereby everybody in Australia was entitled to coverage and was receiving coverage. By 1979 over two and a half million Australians, or families in Australia, were not covered by private insurance. One can only assume that with the downturn in the economy since that time, that situation has grown worse. The previous Government did make a change to the scheme to look after those people who could not afford private health cover. They could not afford it because it had become so expensive, because of the numbers of changes and because of the way the Government was pandering to the private health insurance companies and the doctors. The previous Government said: 'We understand that some people cannot afford to be covered, so we will look after the socially disadvantaged. We will not give everybody free treatment by right. We will be condescending and call them socially disadvantaged people'. Pamphlets which the previous Government sent to people stated: 'If you wish to talk to your doctor on your next visit about your personal circumstances, you may become entitled if the doctor thinks it is appropriate'. The doctor became the judge as to whether someone should be entitled to some form of treatment. That was the previous Government's consideration of how people should be treated. This legislation gives everybody the right to medical treatment without distinction with regard to status in life, income or whatever. Every Australian will be entitled to treatment. That is something which the previous Government thought was totally incorrect. Members of the Opposition talk about the cost of Medibank. It is quite clear that when they were in government they did nothing really to contain the health costs. They had to be badgered by public pressure and by the Opposition of the day to do something about bottom of the harbour schemes and those who were ripping off the Government. The same situation applied to Medibank. Who was ripping off the system? Was it the patient, the worker? It was the doctor, the man who was already enjoying a fairly good life in Australia. I refer, for example, to three South Australian doctors who were convicted of charges relating to fraud. During a short period of time in 1977-they had had only two years or 18 months in which to achieve this-they were charged and convicted of fraud offences totalling $280,000. Another $210,000 which they had undertaken to repay was not taken into account. So three doctors in 18 months had been able fraudulently to rip off half a million dollars. Some 30 cases of fraud were prosecuted in other areas; twenty-one doctors were prosecuted. Other cases against doctors, not members of the public, who ripped off the system were dropped. What answer is given by members of the Opposition? We must be fair and say that only a minority of doctors find that earning a good living is not enough, and that they want to make an excessive living and rip off the public. But members of the Opposition do not say: 'Let us really sort out these doctors and fix them up'. They simply say: 'Let us change the system so that we can no longer find whether they are ripping off the public because we really do not want to know about it'. That is their answer. We would then revert to their fragmented system . They talk about the cost of Medibank. They want us to keep in operation the current system in which hundreds of agencies operate, all with bureaucracies and administrators. They want us to employ more and more people in Australia to look after health care. They decry the fact that Medicare will provide a national health service employing 2,000 people fewer than the private health funds now employ. Moreover, it will provide a unique Australia-wide service. At the moment , if it is left to the agencies, a person might be insured in Victoria but if he moves interstate he has to go to different agencies. Medicare will provide Australia-wide coverage. The Opposition knows that it is not true to say that 5, 000 jobs will disappear from private health funds. Those people will not be sacked. They know that arrangements have been made so that people will be employed in the other areas, and they know that there is a turnover of some 20 per cent in private health insurance agencies. As I said before, these Bills will provide a proper coverage for all Australians-something which was not attempted by the previous Government. It attempted to ensure that it looked after those who could afford to pay, and those who could not afford to pay simply had to hope that they never fell sick. Honourable members opposite talk about the problems of bulk billing. Who is opposed to bulk billing? The Australian Medical Association has been opposed to it for a long time. The voluntary health insurance funds have been opposed to it ; they do not like it. The public like it. In surveys conducted by the previous Government there were statements such as 'bulk billing is the cheapest and administratively most efficient billing system'. That quite clearly is the case. Today some members of the Opposition have said that those in the medical profession do not want Medicare. I suggest that is not the case. Many doctors out there, having gone through the at least 11 changes of the previous Government with several Ministers of Health, are saying: 'Enough is enough. We want to go back to what we had in 1975 because that was a simple system which we understood. We now realise the error of our ways when we opposed that change and we cannot wait to get back to it'. Not only will this Bill provide access to health insurance for all; it will also provide it more cheaply than the cost people are paying today. Someone who today is paying well in excess of $12 a week for private health cover with the health insurance funds could save as much as $7 or $8 a week when the levy is introduced and still take out private health cover. If that person decides not to take out private health cover and simply have the public cover, he or she will be saving up to $10 a week. These are the facts. We have heard from the Opposition a lot of hysteria and discussion about socialism and that sort of garbage, hogwash and humbug. But the plain facts are that for the first time since 1975 Australia has been presented with a comprehensive program and plan for health cover and health insurance instead of the fragmented and disjointed programs which the previous Government introduced. When it came to power in 1975 all it knew was that it wanted to destroy Medibank . It set about doing that and it had no alternative. It simply set about taking it down brick by brick-with 11 amendments, as I have pointed out. Now we are presented once again with a comprehensive program which provides cover for all, irrespective of status in life and income without the taint of being socially disadvantaged and without the pressures that have been applied. We have maintained freedom of choice. The patient has the freedom of choice. He has the choice of doctor and he has the choice of whether he wishes to accept public hospital treatment. He has the choice of whether he wants to take out private insurance and go to private doctors and he has the choice of his own local doctors. That has maintained his freedom of choice. The doctors have the freedom of choice. They have the choice of billing patients direct or bulk billing. Mr Connolly —But you want them to bulk bill. The Minister said so. Mr SAUNDERSON —It is their choice. It is not being forced on them by the Government. It is not compulsory. It is their choice. Of course, we would like them to bulk bill because, as I pointed out, reviews under the previous Government showed quite clearly that bulk billing was the most efficient method of payment. In winding up, I think we really have to look at the facts. We have heard a lot of hysteria from the Opposition, but the plain facts are that we now have a comprehensive medical insurance program. Everybody who participates in the medical field and those who have to administrate it, both in the States and nationally, now fully understand what is going to take place. They have a program which will be clearly laid out. For the first time Australians can start to breathe easily-particularly the 2 1/2 million who have not had cover and have been in fear of becoming ill-knowing that they will have health cover as a right . Mr COLEMAN(Wentworth)(6.05) —We are dealing with a package of measures that is basically a disguised deceit. Medicare purports to give us a simpler, cheaper, more efficient and more equitable health arrangement than we have now. In fact it will be none of these things. What it will do is simply advance the cause of nationalisation of health care with all that that means in terms of poorer and more expensive services for the patient. It is very important to be clear on this. At the moment the Minister for Health (Dr Blewett) is acting the role of the good fairy distributing free goods and services in a time of economic distress with no mention made of the bill which the taxpayer and the patient will have to meet later-sooner rather than later-and no mention of the debasement of health services threatened by the Government's scheme. The present health arrangements, which are to be changed, involve a balance of public sector hospitals, doctors and insurance, on the one hand, and three fundamental private sector institutions on the other. The first of these private sector institutions is the private insurance funds-some 38 funds throughout Australia-which employ over 8,500 people and which have provided efficient services for over 30 years. The second is the private hospitals which provide 21 per cent of the hospital beds in Australia and in which independent doctors do most of their work. The third is the independent professions, primarily the medical professions, doctors and specialists, but also physiotherapists, chiropractors and so on. Together these three constitute an effective and efficient alternative system of health service sometimes complementing and sometimes competing with the public sector. It is not perfect. There could be more competition among the funds, for example, and there is the problem of medifraud and overservicing, but these problems can be dealt with without overthrowing the whole system. The Bill before the House, however, is an all-out assault on this private and alternative system. The Government's aim is to dramatically reduce the role of the private funds and the private hospitals, if not to eliminate them, and to reduce the role of and ultimately eliminate private fee-for-service doctors and replace them with doctors in government service and on government salaries. The Bill is a giant step towards the nationalisation of health services. Let us take the voluntary insurance funds first since they are the financial pivot of the private and alternative system. Under Medicare many of the funds will close down . They will no longer be permitted to handle medical insurance since the Medicare one per cent levy is to replace that. In a word, Medicare forthwith nationalises medical insurance. The funds will not even be allowed to cover the gap between the government subsidy and the actual fee charged by the doctor. Some 60 per cent of the voluntary funds' business will be taken over by the Government, by Medicare, and, as an immediate result, some 5,000 employees of the funds will lose their jobs. The hostility of the Minister and of the Government to the voluntary funds is great indeed. The Voluntary Health Insurance Association of Australia proposed that the Medicare scheme go ahead as announced, with one exception, that is, that the funds be agents for the Government, for Medicare. They have the expertise, the equipment and the staff. This would be a practical, cost- effective, flexible and convenient arrangement and it would save 5,000 jobs. But , of course, the Minister did not want that. He wanted to knock the funds over. So, with the help of the Australian Democrats in the Senate, he rejected the proposal and is proceeding with his plan. Even in relation to hospital insurance the Minister in his campaign against the voluntary funds is misleading people into thinking that the Medicare levy in effect covers everything and that hospital insurance with the funds is unnecessary when, of course, for private hospitals or for choice of doctor it is necessary. Many people will drop out of the funds and those remaining will therefore have to pay higher premiums, with the probability of more dropping out. No doubt this is what the Minister hopes will happen. He is determined to destroy the financial basis of the private sector, of private non-government health care. Let me turn to the second basis of the efficient and effective private or alternative system of health care-the private hospital. One in five hospital beds in Australia is in a private hospital. Private hospitals complement the public system by handling a type of operation and service largely not provided by the public system. They are usually community hospitals, far more conveniently located in the suburbs and provincial centres than the great public hospitals. I have nine of them in my electorate. They have long been an established part of the Australian way of life. But in the eyes of the Labor Government they are based on the voluntary principle of independence and as part of the move towards nationalisation they too must go. How is this cause to be advanced? Firstly, Medicare will not apply to private hospitals. The levy simply does not cover private hospital accommodation. To be covered for that a patient will, as well as paying the levy, have to take out hospital insurance with the private funds. But the compulsoriness of the levy means that fewer people will use the funds and the premiums will probably rise-a further disincentive. Incidentally, the Minister for Health is also misleading the public about the costs involved. He has said that a mere $5 a week will be enough to insure for private hospitals . Yet, as the honourable member for Mackellar (Mr Carlton) has pointed out, at $ 40 a day for a bed for six days and $200 for theatre charges, a patient would be over $400 out of pocket with the $5 cover. However, the whole Medicare campaign is based on disinformation. As the voluntary funds weaken and people drop away from membership there will be a drop in occupancy of private hospitals as people move to public hospitals. Private hospitals will cease to be financially viable, staff will be retrenched, services will be cut or hospitals will close. This is the way that I am sure the Minister hopes things will go, the way he has planned it. Even in the meantime, before Medicare is established, the Government is moving against private hospitals. The insurance funds have been instructed to reduce the benefits payable to patients by 40 per cent. So that patients can still afford to come to the hospitals-and I have had many cases brought to my attention in my electorate -fees will have to be reduced. The Government has also ordered an 18 months freeze on the benefits payable so that the hospitals suffer a two-pronged attack ; reduced benefits and increased wages at the same time. How can hospitals survive this, even before Medicare is introduced? Let us turn to the third target in the Minister's attack-the medical profession and the fee for service regime. The key to the Minister's offensive is bulk billing and the making of bulk-billing more or less compulsory. I say ' compulsory', because if one practitioner in a community bulk-bills, that is, offers the so called 'free' service, the other doctors will be under great pressure to follow suit or lose their patients. I am sure the Minister is planning and looking forward eagerly to a system in which the overwhelming majority of doctors bulk-bill; that is, are paid by the Government. Once that is established, the profession loses its independence and its morale and it is an easy step to complete government control and nationalisation with all doctors working for the Government on government salaries. Further, bulk-billing-the so called 'free' consultation-debases the doctor-patient relationship as patients tend to demand unnecessary services and doctors are tempted to overservice, subject to the computerised medifraud squad. It is also relevant to note in this respect that clause 18 of the Bill brings the Minister, and consequently the bureaucracy, directly into the making of medical decisions. So let there be no mistake about it. The future of the medical profession is in danger under Medicare. What will be the general result of Medicare? The medical profession will be yoked to government with bulk-billing. Patients will lose their freedom of choice of doctors and hospitals. Their relation with their doctors will be degraded by the illusion of free consultations with a consequent demand for unnecessary services on the one hand and overservicing on the other, the whole system to be policed by computer surveillance and bureaucracy, and moving with increasing speed into full nationalisation. Private hospitals will collapse and those that survive will be weakened. Public hospitals will be overburdened. A third of the people will pay more for a reduced quality of service and taxpayers will meet the disguised cost of free surgery visits and free public hospital beds. All this will destroy the existing system which, while not perfect, is effective and whose defects could be sensibly corrected. This system gives priority to individual choice, independent professions, independent hospitals and independent insurance. It will be replaced with government control and the certainty of reduced quality of health care. To put it another way, we have in this Bill a vast shift from private arrangements to government control. That is why the measure can properly be called one of nationalisation. There will be fewer jobs in the private sector, fewer decisions made by individual patients and less finance in the private sector. For the taxpayer there will be a colossal increase in government spending-some $1.7 billion, taking into account the increased payments to the States to make up for what their hospitals will not get from the private insurance funds, the removal of the rebate for health insurance payments and the Medicare levy. As for the levy, it is obvious that at one per cent it will not pay for Medicare. The levy will raise $1 billion whereas the scheme will cost the Commonwealth and the States $8 billion. The levy is really part of a conspiracy. The real reason for it is not to pay for Medicare-it cannot-but to fiddle the consumer price index so that, since the levy will not be included in the CPI, the CPI will come down and give a false idea of real rate of inflation. All those from pensioners on whose income is linked to the CPI will find that, since the CPI will come down as a result of the Medicare swindle, their incomes will go up less than expected. Their costs will go up, but not their CPI-related incomes at the rate expected. We have seen how the public and the unions reacted to the Government's superannuation lump sum tax rip-off. When the facts are in and when the public sees the levy for the conspiracy that it is, it will be equally outraged. I said at the beginning of my speech that Medicare purports to give us simpler, cheaper, more efficient and more equitable health care arrangements but it does not. How can it be simpler when it is plainly more complicated for those who want more than the minimum Medicare cover and who will have to deal with both Medibank and a private fund? How can it be cheaper when the Minister admits that one third of people now insured will pay more under Medicare and when it adds $1 ,700m to taxes in a year? How can it be more efficient when it undermines the competitive position of insurance funds and private hospitals and when it makes Medibank a medical insurance monopoly with all the inefficiences of monopolies? How can it be more equitable when it starts with the sacking of 5,000 staff in the private sector, ends with a police state approach to doctors by doubling computer surveillance equipment, and is built on the lie that by removing the one per cent levy from the CPI the cost of living is reduced with the result that pensioners will be robbed of the indexed increases to which they would have been entitled? The real medifraud in Australia today is the Minister. Mr MILTON(La Trobe)(6.18) —In speaking in support of the Health Legislation Amendment Bill 1983 and related levy Bills I make one very important point at the outset; that is, we are a government which is committed to consultation. We do not make decisions in stealth, as did the previous Fraser Government. Rather we believe in open government. Because I have only a limited time to speak in this debate I want to confine my remarks to the aspects of the Bill which relate to hospitals. Earlier this year I addressed a local meeting of the Australian Medical Association in relation to Medicare. At that time I was accused of giving a political speech despite the fact that I had been invited as a politician to address the AMA. What else did the local doctors expect? After all, I was supported by the Secretary of the Department of Health, Mr Laurie Willett, who gave full details of the technical aspects of Medicare and its practical application for medical practitioners. Of course, the AMA had hoped to embarrass me at the meeting in the hope that I would show my ignorance of health care needs. Instead, I was able to put before them the views of the people in my electorate of La Trobe who can no longer afford the exorbitant expense of health care which has been caused by seven years of Liberal-National Party Government. In that period of conservative Government five different health schemes were introduced. They were marked by the stealth of their introduction, with no consultation. They had an immediate effect on sick people who had no chance to learn to cope with the changes. Another thing about my meeting with the local AMA is that I was appalled at the irresponsibility of the Victorian President of the Association who advised the doctors present not to co-operate with the Government in the bulk billing aspects of Medicare. For such a negative attitude to be taken by a professional association towards a positive government initiative is probably unprecedented in recent years and will, in my view, mark the decline of the AMA as a professional body with any integrity or social responsibility. Let me say at this point that I bear no ill will to the individual doctors in my electorate with whom I have talked about Medicare and who are also members of the AMA. I only hope that efforts will be made to get rid of the present conservative leadership of the AMA so that those doctors who care deeply for their patients are able to bring their views to the fore, and patients can once again have faith that their doctor is truly catering for their interests. Perhaps I am old fashioned, but I had always thought that doctors studied for the profession because they had a real desire to heal the sick rather than to gain a high salary and status. I have every sympathy with a doctor who has bought an expensive practice and is struggling to meet high capital costs. However, that is no excuse for imposing a high fee structure on sick patients who have no choice but to pay the piper. Now I have those remarks off my chest I wish to talk about the aspects of Medicare which relate to hospitals. The first thing to point out is that if we were not introducing Medicare on 1 February next year the cost of a ward bed in public hospitals throughout Australia would be $130 a day and premiums would be rising even higher. For lower and middle income earners who take out health insurance the costs have become a great strain on the family budget. The arrangements for reimbursing the States will represent a fair reimbursement of the revenue that will be lost through the removal of public hospital charges. Medicare will provide the same entitlement to basic medical benefits and treatments in a public hospital by the hospital doctors to every Australian resident regardless of his or her income. In a society as comparatively wealthy as ours, no one should be deferring treatment because he or she cannot afford the medical bills. Basic health care is the right of all Australians. I do not accept the view of the AMA and members of the Opposition who argue that providing cover to all Australians will encourage the overuse of health services. There is no reason to expect that the two million Australians without cover at present will use medical and hospital services more than will the rest of the community. Those people in the profession, and honourable members opposite such as the honourable member for Mackellar (Mr Carlton), who try to make invidious comparisons with the introduction of the health system in Britain, are distorting the facts. As a resident of Britain at the time of the introduction of the new national health system I can vouch, as a patient, for the success of that scheme. Apart from the great need which all such people have for Medicare, the universality of cover is also most advantageous in terms of efficiency and reduced administrative costs. Doctors and hospitals will find that their bad debt problems disappear overnight. In public hospitals there will be no need to check for free treatment entitlement or for private fund membership; nor will there be any need to hound patients for the payment of bills if they do not fall into either of those categories. Medical benefits will be payable for medical services rendered to in-patients of public and private hospitals. Subject to agreements with each State and the Northern Territory, all persons eligible for Medicare benefits will also be entitled to public hospital in-patient accommodation and treatment without charge when that treatment is provided by a doctor appointed by the hospital. Out-patient treatment in public hospitals will also be provided without charge. A matter which will require attention in the future is the need to cover motor vehicle third party and workers compensation services under Medicare. It is important, in my view, to simplify the administrative procedures in such cases. Possibly such simplification will reduce the high medical costs involved. People wishing to have private treatment in a public hospital or treatment in a private hospital will be able to insure for such treatment. There will be no need for anyone to take out hospital insurance if he or she is satisfied with the care provided in public hospitals by doctors employed on a salary or sessional basis. With the advent of Medicare the private health funds will inevitably expand the range and level of the ancillary cover for dental and paramedical services. People will be able to obtain cover for services such as physiotherapy, chiropractic, chiropody, dentistry and home nursing and the cost of aids and appliances. I have been contacted by a number of constituents in relation to the need for Medicare to cover these ancillary services, but to include such cover at this time would inevitably increase the cost of Medicare substantially and mean a consequent rise in the levy. I can only say that it was important to introduce the basic medical and hospital cover under Medicare and the ancillary services must be left to the next stage of Medicare. We must not move too far too fast without adequate consultation and review of the services supported by Medicare in its first year of operation. With the introduction of Medicare it will be necessary to cover the costs of public hospitals in relation to the removal of all in-patient and out-patient fees for patients who elect to be treated free as public patients and the reduction of fees for private patients in public hospitals. Reimbursement to the States must also be necessary for the payments they must make to private hospitals for daily bed subsidies from the anticipated date of 1 July 1985. Additional grants will be made to the States for the community health centres and the escalation in the cost of the grants. The agreements between the States and the Northern Territory and the Commonwealth Government contained in the Schedule to the Health Legislation Amendment Bill will, amongst others, include the requirement that public hospital admissions be made solely on the basis of medical need without regard to health insurance status. There will be peer review and hospital audits with an expansion of hospitalisation and certificates of need for high technology equipment. Health costs in public hospitals have been escalating over the past few decades. The arrangements contained in this legislation will ensure that the Commonwealth Government plays an important role in the national policy and planning aspects of the medical services provided by public hospitals. The right of private practice for salaried doctors in public hospitals has been a matter of concern to me for some time. I welcome, therefore, the provisions of this legislation which ensure that Commonwealth medical benefits will be payable for diagnostic services provided to in-patients and out-patients of public hospitals only if the service is provided in the form of a contract between the medical practitioner and the hospital and which is acceptable to the Minister. The medical practitioner will be able to draw up to 25 per cent of a full time specialist's salary from charges received under the contract, the residue being used on the basis of State government guidelines. I anticipate that visiting diagnostic specialists will be required to receive comparable remuneration for the services they provide. As the Minister for Health (Dr Blewett) has indicated , this provision will remove the present defective double payment for services offered and introduce some accountability into the right of private practice. It is not, as some commentators have attempted to assert, an attempt to abolish the right of private practice. I wish now to discuss the categorisation of private hospitals which will take effect under the Health Legislation Amendment Bill. Private hospitals cover a wide range, with major surgical hospitals at one end of the range and, at the other, bush nursing hospitals, some of which provide services similar to that provided by nursing homes. Despite the large difference in the cost structures as a result of the different level of care provided, the level of fees is the same and substantial profits can be made by the nursing hospitals while the major hospitals are just able to survive. Thus the Bill proposes a three tiered structure: Category A hospitals will receive $120 per day in basic benefit and $ 40 per day in Commonwealth bed subsidy; category B hospitals will receive $100 per day basic and $30 per day bed subsidy; and category C hospitals will receive $80 per day basic and $20 per day bed subsidy. Each category will respectively therefore receive $160, $130 and $100 per day. From 1 February 1984 these benefits will reflect reasonable cost levels rather than the inflated levels involved in some present private hospital charges. Regulations will lay down the principles of categorisation under the Health Insurance Act and will have regard for the actual services provided in a hospital, subject to the opinion of the State Minister of Health with regard to the relevant category. Appeals against the categorisation can be made to the Minister and to the Administrative Appeals Tribunal. I do not accept the recent newspaper reports that bush hospitals will suffer financial problems as a result of Medicare. As a result of the increased bed subsidies, a total of $113.2m will be paid to private hospitals in 1983-84, representing an increase of more than 50 per cent on the previous allocation for bed day subsidies. As from 1 February 1984, insured patients in a private hospital who are classified as nursing home type patients will be paid $80 per day, less the patient contribution. This amount will be frozen at that level until it is equal to the standard nursing home benefit plus the patient contribution. If the nursing home type patient elects to be treated as a private patient the present arrangements will still apply. There will be no charge for public patients but the patient contribution will still be payable. Having given my own rundown of the provisions of the legislation which will affect the hospital system I indicate again my strong support for the introduction of Medicare. As a result of successive conservative, Liberal-led governments in Victoria and Canberra, Victorian hospitals have severe problems. There have been years of neglect and the State Labor Government has inherited a public hospital system which is in rapid decline. The introduction of the new health Bills in this Parliament is the beginning of a new era for the hospital system. In particular, the consultative process between Commonwealth and State governments will help to streamline and make more efficient hospitals' financial and operational procedures. Audits, peer review and the monitoring of the introduction of high technologies such as nuclear medicine, ultrasound, coronary by-pass grafts and computerised axial tomogram scanners will reduce the escalating costs of modern medicine. These improvements will not occur overnight . I commend these Bills to the House. Sitting suspended from 6.30 to 8 p.m. Mr SPENDER(North Sydney)(8.0) —As other members have remarked, the debate on the Medicare legislation now before the House is a most important debate. Undoubtedly, for different reasons, one can approach the legislation from the point of view that it is all good, from the point of view that it is all bad, or from some point somewhere between those two extremes. I do not for a moment suggest that the previous system was an ideal system. I am not here to propose what would be the ideal system. But with the greatest of respect to those on the Government side who have spoken with sincerity about the legislative proposals, it seems to me that when they extol what is before the House, when they speak of the simple nature of these proposals, when they talk about equity, they are using the buzz words which spring to the mind of the Australian Labor Party when it looks for neat and tidy solutions to human problems-after all, medicine and the provision of medical services is a very major human problem. Their tidy, if unoriginal, minds opt for what appears to be a tidy solution. But in doing so, they have forgotten or put to one side some major defects in their proposals. I should like to say something about funding, about nationalisation by indirection, about the essentially anti-democratic nature of what is proposed, and about the consequences of these proposals, if enacted, for the quality of health care. No one in this House would pretend that the one per cent levy is other than a convenient fiction. The Minister for Health (Dr Blewett), in his second reading speech, in contrasting the proposed system with the Fraser Government's system, said this: Medicare will be substantially self-funding through the one per cent levy and a rearrangement of existing health insurance subsidies, whereas Medibank placed a considerable strain on Consolidated Revenue. Let me make two points. First of all, it could never be said that Medicare will be substantially self-funding through a one per cent levy; secondly, in contradiction to Medibank placing a considerable strain on Consolidated Revenue, or by contrast, this proposal now before the House is in effect to be financed exclusively out of Consolidated Revenue. The Minister for Health would be the last person to deny that one's estimates of the costs of his proposals could vary. On 16 December of last year he was reported as having altered his proposals because of an increase in the expected cost of running the scheme. To refer briefly to an article in the Age of that date, it says: Labor's health spokesman, Dr Blewett, announced yesterday that the main source of finance for the scheme-a proposed levy on people's taxable income-would have to be increased by a third to cover the costs. Dr Blewett said substantial increases in hospital charges during the past six months had made the changes necessary. That, of course, repeats this convenient fiction that we are here only concerned and that the public is only concerned really, with the one per cent levy. But it makes the point very clearly that the Minister for Health there had to reorder his thinking on estimates, and that the making in advance of an estimate of the cost of these kinds of proposals is a difficult and sometimes dangerous exercise . One might turn back to the British health scheme introduced in 1948. The British Civil Service-a civil service of equal competence, one would think, to the Australian Public Service-estimated that it would cost $150m in its first year. The actual expenditure for the first complete year, 1949-50, was $436m, or 190 per cent over the estimate. When we look at what is proposed, let us bear in mind that what we are really talking about is government control, indirect nationalisation, of the bulk of the medical services which are to be provided in this country. I remind the House of something that was said by Dr E. Grey-Turner , former Secretary of the British Medical Association, in May 1980. He said: The demand of treatment is infinite and any government which nationalises the bulk of its medical services as the British Government did in 1946-48 saddles itself with an economic liability which is practically impossible to control. Of course, the economic liability flows from the nature of what is offered. Any service which is offered as free, be it postal, be it the telephone service, be it the train service, be it an air service, will be used, over-used and abused. It is human nature. Here we shall face a situation in which doctors will be under very heavy pressure to engage in bulk billing, and in which patients, in cases in which the doctors charge 85 per cent of the schedule fee, will not have to pay. What will that do? That will provide an inbuilt momentum to the extension of the uses of medical services. When the Minister says-as I believe he has; certainly it has been raised in the debate-that one can, as it were, check the overcharging, and that he proposes to spend much more money for the purpose of detecting medical fraud, let him bear in mind that it is one thing if one can distinguish between the profiles of services provided by various doctors; it is another thing when the whole profile of the service itself changes. If one takes a group of doctors and one sees that, of a group, one, two or three are doing 50 per cent more work or sending out 50 per cent more bills from the same area, one can come to a fairly sensible conclusion that something needs to be looked at. But if one finds that the system itself is just increasing in the work load that it gets through, that the servicing charges are increasing throughout the country, then one is up against a problem of a different kind, which is precisely the kind of problem that has been faced in England. The British National Health Service is now Western Europe's largest single employer. It employs about one million people, and its budget for 1981-82 was #11 billion. In the decade to 1981-82 spending had increased by six times. That gives us a glimpse of the kind of road down which this Government apparently proposes to travel. Let me now say something about nationalisation by indirection. Controls can be so extensive, so pervasive and so rigorous as to amount in effect to nationalisation. That is precisely what is taking place here. As the Minister very directly admits, we have the creation of what is effectively a state monopoly on the provision of insurance. Of course, it is insurance which underpins the provision of services, the whole of the medical scheme in this country. Once one creates that kind of monopoly, effectively one is creating a state monopoly, and state monopolies are not only as bad as other monopolies, they are worse. Established by the state, they can only be disestablished by the state. Nourished, supported and protected by the state, their privileges and powers become entrenched and, as the Minister would understand, they are difficult to remove except by drastic action. It is bad enough to have a state monopoly. It is worse when what we get is a highly undemocratic system, and that is what is proposed in this scheme. These kinds of proposals are often justified as being efficient, egalitarian and democratic. The proposal before the House is not democratic. It pretends to be egalitarian and its efficiencies remain to be tested but, judging on the British experience, the likelihood of efficiency is not good. Let me concentrate upon the democratic nature of what is proposed. Democracy implies choice and, fundamentally, if one does not have choice then to that extent one's democratic rights are eroded. In this proposal one is not free to choose another form of insurance. There is to be only one form of insurance. One will not be free to make other arrangements to finance one's medical care. One will have to pay the levy, which will go some little distance to the financing of the scheme, whether one likes it or not. Nor will people be free to take out gap insurance, and this is a denial of what must be a basic democratic right-the right to insure. Why should people not be permitted to insure for the difference between the 85 per cent of the schedule fee and what may be charged above that? The Minister in his second reading speech stated: In line with the recommendations of the 1980 Jamison Commission of Inquiry into the Efficiency and Administration of Hospitals appointed by the previous Government we will be legislating to prevent both private health funds and general insurers from offering cover for the 'gap' between the Medicare benefit and the schedule fee. The reason for this is quite simple and practical. As the AMA stated in evidence to the Jamison inquiry-- One might think that calling on the Australian Medical Association is somewhat ironic-- 'Doctors generally believe that there should be a charge at the point of service' The Minister went on to state: In this report Jamison noted that 'it'-gap insurance-'underpins the practice of fixing charges above the schedule fee'. After making some other observations, he went on to state that effectively, overall, 'people are financially better off without gap insurance'. Further, he stated: It is only doctors who would be financially better off if gap insurance were permitted. Therefore, the Government knows better than people, people should do what the Government tells them and, of course, doctors are the kind of people who would rip off any system at all. Let us go back to the Minister's real justification. The Minister quoted that the AMA stated in evidence to the Jamison inquiry: 'Doctors generally believe that there should be a charge at the point of service'. The Minister called that statement in aid for his proposal for a law that would prevent a citizen of this country from taking out insurance against the gap. He accepts the rationale of the AMA: 'Doctors generally believe that there should be a charge at the point of service'. Yet that is inconsistent with the plain intent of his proposal, which is, effectively, to force doctors to bulk bill. The reasons for that have been explained by those on this side of the House. The economic pressures upon the doctors will be great. The pressures on doctors from those who go to the doctors for treatment will be great. If the Minister's intent is successfully carried through, as he plans that it should be, the rationale will disappear because there will be no charge at the point of service. I wish to say something briefly about two other matters, private practice and the consequences for quality care. The Government proposals on private practice have been laid out. What is essentially wrong about the Government's proposals for control of private practices in hospitals is that control, effectively, will be reposed in the Federal Government. As the Minister said in his second reading speech, the form of contract between the doctor and the hospital will be a form acceptable to the Commonwealth. That is the beginning of a Commonwealth takeover of private practice by doctors in hospitals and nothing else. The Minister would know that that is inherent in this proposal. Lastly, let us consider the consequences for quality care. It has been said by other speakers from this side of the House that these proposals are not concerned with quality of care. Certainly they are not. They are concerned with administration, with insurance, with financing, and with controls; controls on how health services should operate, controls on how they should be funded, controls on how the services rendered by doctors should be paid for, controls over doctors, controls over hospitals; controls in effects, over most aspects of the provision of medical services in this country. One ties in the control to the source of funding and that, of course, is always the best way of securing control. We are not concerned with quality, but if we look to the consequences we see that it is now proposed that the Government will be virtually the sole provider of funds for the provision of medical services in this country. There will be some form of private insurance but one would expect that that will be of a relatively small nature and, certainly for the great majority of people, the Government will be providing the funds for the services they need. This has happened in the United Kingdom. One of the things we have seen there is that decisions on what services should be provided become part of the budgetary process. When, in the budgetary process, bids are put in for the purposes of expenditures, there are winners and losers. In the field of providing medical services the losers are those who need those services. Take as an example a case where a decision has to be made as to what kind of treatment should be provided on a priority basis. This problem has appeared in England. I think the honourable member for Mackellar (Mr Carlton) referred to an example of a man with a hernia who is denied treatment for a long time because it is not considered to be particularly essential treatment. It may not be essential for the healthy bureaucrat, the healthy government official, or the healthy Minister but it is exceedingly essential to the person who suffers. Those kinds of instances could be multiplied. What will that mean? It will mean that in the end, because virtually there will be little outside finance coming in-under the present system there is the mix of what the Government provides and what comes in through the private insurance system, which is a very flexible system-decisions will have to be made as to what can be done, what treatment is to get priority, and the quality of treatment. Within budgetary constraints the decisions are adverse. That means that the amount available to be spent on providing medical services will be limited. That limitation will be felt in the quality of the medical service and by people who require that medical service but cannot get it because the government of the day decides that the funds simply are not there. That is one of the major problems when governments get fully involved in health care. Quality suffers and those who need the care suffer as a result of that quality suffering. Debate interrupted. Mr SINCLAIR(New England) —Mr Deputy Speaker, I seek to make a personal explanation. Mr DEPUTY SPEAKER(Hon. Les Johnson) —Does the honourable member claim to have been misrepresented? Mr SINCLAIR —Yes, Mr Deputy Speaker. This afternoon in the New South Wales Parliament that aging machiavellian figure, the Leader of the Australian Labor Party, slipping as he is into the depths of political oblivion, made four misrepresentations with respect to the Leader of the National Party of Australia (Mr Anthony) and me. First, he said, on the manner of taking decisions by the coalition Government, that there was an arrangement between my Leader and me with the then Treasurer and the then Prime Minister to get backing for the financing of the Split Rock Dam in the Namoi Valley, adjacent to Manilla in northern New South Wales. While I know that in New South Wales it has been a practice for those who are exercising political power to exercise that power in their relationship with individuals, as has been so aptly demonstrated by the efforts of the Leader of the Labor Party- Mr DEPUTY SPEAKER —Order! The right honourable member is required to show where he has been misrepresented. Mr SINCLAIR —Mr Deputy Speaker, I have just done so. I related what I understand was his statement this afternoon, that my Leader and I went to the then Treasurer and the then Prime Minister to get backing to finance the Split Rock Dam in the Namoi Valley. That is not the way decisions were taken by the coalition Government. Each of the decisions with respect to the funding of the dam was taken in full Cabinet and in a proper way, unlike decisions with the police and the magistracy in New South Wales. In the second misrepresentation it was suggested that I was personally behind the Federal Government's 'bungle on Split Rock Dam finances'. I think the picture needs to be set straight. The coalition Government provided $500,000 on a dollar for dollar basis with the State in 1980-81 and offered New South Wales $1.5m for 1981-82. The State accepted the offer of assistance but claimed only $ 250,000, leaving a shortfall of $1.25m. An offer of $1m from the Commonwealth for 1982-83 under the NWRP was not accepted. An offer made by the then Minister for National Development and Energy, Senator Sir John Carrick, to the New South Wales Government and discussed by him with the then recently appointed New South Wales Minister for Water Resources, Mr Paul Whelan, on 7 February 1983 was to fully fund the Split Rock Dam to the then assessed cost of about $43m, on the figures that had been provided to the Commonwealth by the New South Wales Water Conservation and Irrigation Commission. Contrary to the allegation about the bungle the facts are that the New South Wales Government refused the offer from the Commonwealth. In the misrepresentation, the Premier of New South Wales alleged that my Leader and I reneged on the Commonwealth's offer. Mr Deputy Speaker, the point is that it was the New South Wales Government that rejected the offer; the Commonwealth did not reject the proposition put to it. The fourth misrepresentation was that, according to the Premier, the funds were given by the coalition Government to fund the Burdekin Dam. I am sure the Prime Minister (Mr Hawke) would be delighted to know of our initiative in that respect. I am also sure that the people of north Queensland would be equally delighted to know that it was the result of worthwhile discussions between Mr Bjelke-Petersen, the Premier of Queensland, and the coalition Government that identified-- Mr DEPUTY SPEAKER —Order! The right honourable member is required to confine his remarks to the misrepresentation he alleges has occurred. Mr SINCLAIR —Mr Deputy Speaker, the misrepresentation is that it has been alleged that these funds have gone to fund the Burdekin Dam. They did not go to fund the Burdekin Dam and Mr Wran well knows it. Mr Bjelke-Petersen entered into discussions with the coalition Government. As a result it was agreed that the Burdekin Dam would be included as one of the propositions within the coalition's $640m water resources development initiative. The Queensland Government accepted the proposition and funds are provided for that in this Budget. The New South Wales Government rejected our offer to fund the Split Rock Dam and no funds have been provided in this Budget. The fifth misrepresentation is a suggestion that there was a great betrayal of the country people by my Leader and me. Contrary to that assertion, it is Mr Wran who has betrayed them. It is Mr Wran who refused to purchase the land of settlers who were sadly affected because of the proclamation of land to be dammed. Mr DEPUTY SPEAKER —Order! The right honourable gentleman-- Mr SINCLAIR —Mr Deputy Speaker, these are the misrepresentations-- Mr DEPUTY SPEAKER —Order! I ask the right honourable member to come to order. I remind him that he has no prerogative to make any accusation. He simply has a right to speak of the misrepresentation he alleges has occurred. Mr SINCLAIR —Mr Deputy Speaker, I point our that I am responding directly to allegations made in the New South Wales Parliament about me and my involvement in having funds spent in a way other than that which was provided for in our Budget. The point is that the funds for New South Wales for the Split Rock Dam, provided under the program, were rejected by the New South Wales Government. I reject as totally false the allegations made by Mr Wran. Debate resumed. Mr WELLS(Petrie)(8.27) —The honourable member for North Sydney (Mr Spender), who has just been speaking to us about the Medicare legislation, exercised himself very greatly with gap insurance. The Opposition needs a lot of gap insurance, particularly for its credibility gap, not to mention its power vacuum or its intellectual void. But gap insurance is a non-issue as far as this Parliament is concerned. Recent determinations which have been made and incorporated into this legislation will provide insurance which is better than gap insurance. If any chronically suffering patient incurs, in any year, more than $150 in medical costs above the Medicare rebate, that patient will, after having paid that $150, not be required to pay any more. From then on he will be refunded 100 per cent of the schedule fee. Gap insurance is no longer an issue. Neither is the sinister non-issue which the honourable member for North Sydney addressed himself to and exercised himself with greatly, namely, the alleged creeping tentacles of the Government taking control of medicine. He suggested that maybe a hernia would be given low priority if the Government were making determinations about the allocation of scarce medical resources and that this was a terrible, crying shame. The honourable member for North Sydney should know that, naturally, in any system of medical care there are priorities. The only question is who determines these priorities. What lies behind the honourable member's remarks is the desire that the priorities be determined on the open market; in order that those who have the funds to pay for medical treatment should be able to get that medical treatment at will. In other words, what the honourable member for North Sydney believes is that health insurance, health protection, is not a right. According to the Opposition good health is not a right; it must be earned. This argument is as threadbare now as it was in 1974 when the same Opposition advanced it. My concern is with my home State of Queensland and there is a vast number of reasons why this Medicare legislation is going to be of benefit to Queensland. First of all, the free hospital system in Queensland, which was introduced by the Hanlon Labor Government in 1946 and which has been collapsing under the Fraser Government, is going to be revived. Funding for the free hospital system in Queensland has been doubled by this Government. An extra $99m has been given for hospitals. The sum which was previously enjoyed, and I use that word with irony, was $93m granted by the Fraser Government in the last financial year. That was something close to half the previous funding because the Fraser Government had decided it would destroy the free hospital system. These special Commonwealth grants are now available to the Queensland Government. That does not mean that the Queensland Government has so far demonstrated the competence actually to spend the money. It does not mean that the Queensland Government has actually turned that money into jobs for nurses, although thousands of nurses in Queensland are out of work. It does mean that the money is there and some day the Johannes Bjelke-Petersen Government Ministers, in their tardy way, will get around to actually spending the money. The second advantage which will be enjoyed by Queenslanders and which they did not previously enjoy, is that when Medicare is introduced they will have the opportunity to go to the doctor of their choice. Here I could wax metaphysical, for freedom of choice is something well beloved of the Opposition. However, this is a freedom which will be available to people who were previously in the income bracket which allowed them no choice but to go to the free hospital system. The Medicare scheme will save a lot of inconvenience for many people, particularly those in the outback who do not live near a hospital. It will also save a lot of trouble for pensioners, many of whom have to travel long distances to get to a hospital to get the free treatment which they require. They will be much better off. They will be able to go to the doctor of their choice, and provided the doctor direct bills, all they will have to do is walk into the doctor's surgery, show their card, receive their treatment, then walk out and forget all about it. The third advantage that Queenslanders will experience as a result of the introduction of Medicare will be shorter queues in the public hospitals. Those who, for one reason or another, continue to use the free public hospital system in Queensland-a free public hospital system which I stress is being kept operating by funding from the Australian Government-will find the queues are much shorter. This is because many people will take advantage of the Medicare scheme and go to their local doctors and save themselves the difficulties previously incurred in going to hospitals. The three advantages that I have mentioned are advantages which everybody in Queensland will enjoy, even if so far they have been using the benefits of the free hospital system, which, I repeat, was brought in by the Hanlon Labor Government in 1946. Those who took out private insurance will also benefit. The average family is on an income of somewhere between $300 and $400 a week. There are more average families in Petrie as a proportion of that elecorate than in any other electorate in Australia. The average family will benefit more than will any other group in the nation. On behalf of my constituents I would like to thank the Minister for Health (Dr Blewett) for bringing this great benefit to my electorate. The family on $300 income a week will save $10.20, provided that family is paying the levy and opts for public hospital treatment. If that family decides to go for the levy plus private hospital treatment-which of course was not available under any previous scheme and will not be available under Medicare -it will save $5.20. A family with $400 a week income, if it pays the levy only will save $9.20. If it pays the levy and also pays for private hospital treatment it will save $4.20. Even those who are on a family income of $900 a week will save $4.20. I have to admit that one would break even if one earned $ 900 a week and one decided to lash out and purchase private hospital insurance. At the moment most Queenslanders are paying insurance premiums of 4 per cent of their average weekly earnings. Under Medicare the levy will be one per cent. Almost everybody in Queensland will be better off. Mr White —Except the 30 per cent who will not be better off. Mr WELLS —That 30 per cent is entirely fictitious, like most of the honourable member's delusions. Low income earners in Queensland will receive the greatest benefits of all. The 30 per cent about which the honourable member opposite was hallucinating was perhaps the one-third of Queensland families who will be exempt from the levy by virtue of the fact that their incomes are under $200 a week. The standard of living in Queensland of course is somewhat lower than elsewhere in Australia. People in the Australian Capital Territory, the Northern Territory, Western Australia and New South Wales are all ahead of people in Queensland. The average weekly income of people in Queensland and Victoria is much the same-$370-odd. This perhaps explains why a large proportion of people in Queensland will benefit by being exempt from the levy. Queenslanders as a whole will benefit from the levy. The levy will cost Queenslanders $146m. Mr White —This is the national Parliament, you know; we are talking about Australians. Mr WELLS —I am the member for Petrie. I represent the residents of that electorate. They happen to be Queenslanders, but it is an unfortunate fact that we are still hidebound by the system of State governments which are nothing more than a burden on the taxpayer. However, while that unfortunate fact exists, I nevertheless represent Queenslanders, labouring as they are under the totalitarian yoke of the Bjelke-Petersen Government. Queenslanders as a whole will benefit. They will be paying, in terms of the levy, $146m. Mr Spender —He does not know he is a member of the national Parliament. Mr WELLS —If the bovine roarings from the Opposition would die down, I could give honourable members opposite a little more arithmetic which will probably be a bit beyond them. The sum of $130m in extra reimbursements will flow to Queensland taxpayers as a result of the Medicare system. That is $130m more than they have been receiving under the present health system. Add to that $51m for the Queensland hospital system plus a $35m special grant and that puts Queenslanders $70m ahead on the Medicare deal. Contrary to the seldom argued but often articulated views of National Party members in Queensland and elsewhere, Queensland will not lose out on the Medicare system. It will be a very great benefit to the State to which I belong. It will be a very great benefit to the people whom I represent. Whether they are families, whether they are pensioners, whether they live in the country or whether they live in the city, one way or another these advantages which I have mentioned will accrue. Consequently, I applaud the introduction of Medicare. I applaud it as an improvement on the present health system in the State to which I belong, and I call on all honourable members opposite to support this Bill. Dr BLEWETT(Bonython-Minister for Health)(8.38) —First of all I wish to thank those members of the Government who participated in the debate and who have given the Health Legislation Amendment Bill their support. I am afraid that I cannot say the same about the members of the Opposition who participated, because apart from some rare exceptions, which I will note, their contributions have been simply a collection of slogans, cliches and sometimes simple abuse. Indeed, much of the debate has clearly revealed that the Opposition has forgotten everything and learned nothing from the experience of the health debate of the last 10 years. The one fortunate aspect of that, of course, is that quite a number of statements which have been made today from the Opposition benches will ensure that the Opposition members stay there. One of the saddest aspects of the debate was that we had the gaggle of health Ministers who represented the last Government each making speeches. That is, we had three ex-health Ministers-perhaps I should exclude the last Minister, the honourable member for Mackellar (Mr Carlton), and just take two Health Ministers -who between them managed to produce five health schemes. The three Health Ministers, in what they said, perfectly reflected the frozen state of the debate . They reflected the characteristics which each of them displayed as Minister for Health. The honourable member for Gwydir (Mr Hunt) talked about nothing but the cost of Medibank. He talked about it in terms of six or seven years back, without any recognition of the fact that in recent years most of what he said has been clearly proven to be false. Indeed, most of the analyses of Medibank usually now start off with quotes from the honourable member for Gwydir to show the absurdity of the myths he has perpetrated. He talked about the expense of Medibank. He never bothered to note that in the one full year that Medibank ran it came in under budget. It was not an open ended health scheme; it came in nearly $90m under budget. It was planned carefully, and in that one year it was allowed to operate it came in $90m under budget. The previous Government appointed the Jamison Committee of Inquiry into the Efficiency and Administration of Hospitals to look into the costs of health care in this society. That Committee, in its 700-page report, examined and identified all the major areas of escalating health costs in this country. Not once in those 700 pages is there any suggestion that Medibank as such was responsible for the escalation of health costs in this country. The honourable member for Gwydir has never bothered to tackle intellectually the real problems posed by reports presented by his own Government. I was delighted by his final remark; he talked about how community health had been gobbled up by the States and public hospitals. Yet it was his Government that decided to hand back community health in a block grant unidentified to the States so that gobbling up would occur. Now I turn to the second of these ex-Ministers, the honourable member for Warringah (Mr MacKellar), who of course devoted most of his speech to talking about my fundamentally dishonest approach. He said that somehow we are involved in a gross deception and a confidence trick. Let me say of the honourable member for Warringah that he is certainly an expert in deception. I have a Press release issued by that honourable member when he was Minister for Health in the middle of the election of October 1980. He made three assertions. He asserted that the Government had no intention of scrapping its health insurance policy. He said there was absolutely no truth in the rumour that the Government was planning to restrict patients' free access to public hospitals by re-imposing a means test for hospital care and that the Government had no intention of reducing funding for public hospitals and community health services. Those three statements were made in the midst of the election of 1980 by the honourable member for Warringah when he was the Minister for Health. Within six months each of those three pledges was dishonoured. If we are to have judgments about whether I have been deceiving the public we should look at who makes those statements. Let me say by contrast to the honourable member for Warringah that we have endeavoured on every occasion to present our policies as fairly as we could and admit, as the honourable member for North Sydney (Mr Spender) said, that when certain major changes took place in the cost of public hospitals we would have to adjust the levy-and we have told the public of that. The honourable member for Wentworth (Mr Coleman) accused me of deceiving people about the need for private insurance. In every table we have put out we have presented that private insurance option. In every public statement we have made we have told people that Medicare provides only the basic cover and that they should look, if they want to do so, to the need for private insurance and its costs. The honourable member for Wentworth epitomises, I think, what is wrong with the Opposition; that is, its refusal to examine seriously the proposals being made by the Government. He epitomises the simplistic sloganeering which contributes nothing to the health debate in this country. He said three things which were echoed by many other honourable members. He said that the aim of the Bill is to eliminate the private funds. Let me say quite clearly that the aim of the Bill is not to eliminate the private funds. We do not deny that the object of the Bill is to make basic medical care in this country a public responsibility which should be borne by a public fund. Unlike the previous Government we do not believe that basic health care in this society should be the responsibility of a gaggle of private funds; it should be the responsibility of a single public fund . But that does not lead us to believe that the private funds do not have a significant supplementary role to play. The fundamental difference between us and the Opposition on this point is firstly, not that we wish to eliminate the private funds. We believe that the public fund should bear the basic responsibility for health care and should be supplemented by the private funds. Secondly-this is reflected in much of what the Opposition said-The bill is supposed to eliminate the private hospital sector. It does the very opposite. It seeks to provide and underwrite the best elements of the private hospital system. We have tried to provide a portable, low cost private hospital table, and in order to achieve it we have had to categorise private hospitals so that the moneys go to private hospitals in relation to their costs. I believe that the very best elements of the private hospitals system in this country recognise that that is a fair and appropriate way of doing it. Finally, the honourable member for Wentworth echoed what so many others had said; that is, that we are out to eliminate private fee for service medicine. I share many of the doubts of my colleague the honourable member for Prospect (Dr Klugman). In many ways we are underwriting private fee for service medicine. There is no doubt that this is a measure which serves to underwrite the private fee for service system in this country. It is simply a fantasy to say that somehow this is aimed at eliminating the private fee for service system in this country. Let me turn to the remarks made by the honourable member for Bass (Mr Newman) who, after making the usual ritual obeisance to socialism and nationalisation, raised a number of worthwhile issues which I believe it is the responsibility of the Government to answer. First of all, he asked a question relating to the basis of our hospital cost calculation. We discussed with every State the expectations of the shifts and changes that would take place not only in private to public shifts within our hospitals but also in outpatient areas and in the standard medical fees paid in the public hospitals. We worked out a calculation which proved to be acceptable to most of the States. I believe that the States considered it to be a fair calculation for working out hospital costs. We have also indicated that the calculation must at this stage be hypothetical but we believe that the moneys we have indicated are the most that are likely to move over. We have indicated that every three months we will look at the shifts and changes that take place. I am disappointed that the issue of the cost sharing agreement with Tasmania has been raised because it was my clear understanding from the decision made at the Premiers Conference that: The heads of Government agreed on the revised proposals for Medicare as outlined by the Minister for Health in the Premiers Conference, including the basis of the compensation payments to each of the States. The basis of that statement included the cost sharing rearrangements. Indeed, the arrangements are desirable from Tasmania's point of view because if cost sharing remained Tasmania might well share half of the extra costs. The Commonwealth is prepared to bear the total costs as a result of those shifts. That is the reason we moved in that direction. I have had communications with the Minister for Health in Tasmania and I have done my best to get our officers together so that we can solve this problem. South Australia very clearly accepted that it is advantageous to it to move out of the cost sharing arrangement when the Commonwealth is willing to bear all of the extra costs related to any shifts that might flow from the system. I hope that that point will be resolved. The honourable member for Bass asked me about the estimate of our cost for family cover for private hospitals which I have said will be about $5. That is about all I can say at the moment because it will depend on what the private funds determine in relation to the whole system when they look at it. I can tell honourable members the basis of that $5. As honourable members know, at the moment across Australia the cost of a bed in a shared ward is $122 per day. We have reduced that figure to $80 per day. Of course, over half the private beds in this country are in public hospitals. In addition, we have changed the arrangements for long term patients which will also enable the health insurance funds to reduce their charges. It is on those bases and on the basis of some minor calculations that we are fairly confident-we have had actuarial advice- that the cost will be about $5 for a family, though it will differ a little from State to State and probably from fund to fund. Finally, the honourable member for Bass referred to the complexity of doctors dealing with the direct billing system. The reason they have great problems at the moment and there are great delays is that we have a complicated insurance system. It is necessary for both the doctors and the Government to identify whether a patient is entitled to direct billing. They have to identify whether a patient falls into one of those numerous categories of a health care card holder , pensioner health benefit card holder or health benefit card holder. They then have to check all the numbers to see that they are right. That is why we have so many delays in this system. Under Medicare, as a doctor will be able to bill directly any patient, none of those problems will occur. We are fairly confident that we will be able to return a direct billing payment to a doctor within approximately five working days of its reception. This will be a very big improvement on the present complicated system which, in my view, has quite unacceptable delays. Mr Newman —What about mistakes with paper work? How long do you reckon that would take? It takes six months at the moment. Dr BLEWETT —From the point of view of paperwork, that will be much simplified because in relation to the Medicare card we are offering all doctors a simple direct billing machine similar to that provided through the Bankcard system. So I think that we can fairly competently deal with that problem of delay. No doubt I will have a chance to deal with some of the other particular problems as I gather considerable debate is to take place in Committee. I just say again that I do not believe that the Opposition's sloganeering and cliches have contributed anything to this debate. I would welcome constructive and worthwhile comments from the Opposition. I must say that I have received such comments from the Australian Democrats but, on the whole, not from the Liberal- National Party. Question put: That the words proposed to be omitted (Mr Carlton's amendment) stand part of the question. The House divided. (Mr Deputy Speaker-Hon.Les Johnson) Ayes . . . . . . . . . . . 65 Noes . . . . . . . . . . . 39 —— Majority . . . . . . . . . 26 —— Baldwin, P. J. Keating, P. J.Beddall, D. P. Kelly, R. J.Bilney, G. N. Kent, L.Blanchard, C. A. Keogh, L. J.Blewett, N. Kerin, J. C.Bowen, Lionel Klugman, R. E.Brown, John Lindsay, E. J.Brown, Robert McHugh, J.Brumby, J. M. McLeay, LeoCampbell, G. Maher, M. J.Charles, D. E. Mayer, M. J.Charlesworth, R. I. Mildren, J. B.Chynoweth, R. L. Milton, P.Cohen, B. Morris, AllanCross, M. D. Morris, PeterCunningham, B. T. (Teller) Morrison, W. L.Darling, E. E. Mountford, J. G.Duffy, M. J. O'Neil, L. R. T.Edwards, Ronald Punch, G. F.Everingham, D. N. Saunderson, J.Fatin, W. F. Scholes, G. G. D.Free, R. V. Scott, J. L.Fry, K. L. Simmons, D. W.Gayler, J. Snow, J. H.Gear, G. Staples, P. R.Griffiths, A. G. Steedman, A. P.Hand, G. L. Theophanous, A. C.Hayden, W. G. Uren, T.Hollis, C. Wells, D. McM.Howe, B. L. West, S. J.Humphreys B. C. (Teller) Willis, R.Hurford, C. J. Young, M. J.Jones, Barry Aldred, K. J. Hunt, R. J. D.Andrew, J. N. Lloyd, B.Braithwaite, R. A. McGauran, P. J.Burr, M. A. MacKellar, M. J. R.Cadman, A. G. McVeigh, D. T.Cameron, Ewen (Teller) Macphee, I. M.Carlton, J. J. Millar, P. C.Coleman, W. P. Newman, K. E.Connolly, D. M. O'Keefe, F. L.Dobie, J. D. M. Porter, J. R.Drummond, P. H. Robinson, IanEdwards, Harry Rocher, A. C.Fisher, P. S. Ruddock, P. M.Goodluck, B. J. Shipton, R. F.Groom, R. J. Sinclair, I. McC.Hall, Steele Spender, J. M.Hawker, D. P. M. Street, A. A.Hicks, N. J. (Teller) White, P. N. D.Hodgman, W. M. Wilson, I. B. C.Howard, J. W. Reeves, J. E. Fife, W. C.Dawkins, J. S. Lusher, S. A.Jacobi, R. Cowan, D. B.Child, J. Moore, J. C.Beazley, K. C. Tuckey, C. W. Question so resolved in the affirmative. Amendment negatived. Original question put: That the Bill be now read a second time. The House divided. (Mr Deputy Speaker-Hon. Les Johnson) Ayes . . . . . . . . . . . 65 Noes . . . . . . . . . . . 40 —— Majority . . . . . . . . . 25 —— Baldwin, P. J. Keating, P. J.Beddall, D. P. Kelly, R. J.Bilney, G. N. Kent, L.Blanchard, C. A. Keogh, L. J.Blewett, N. Kerin, J. C.Bowen, Lionel Klugman, R. E.Brown, John Lindsay, E. J.Brown, Robert McHugh, J.Brumby, J. M. McLeay, LeoCampbell, G. Maher, M. J.Charles, D. E. Mayer, H.Charlesworth, R. I. Mildren, J. B.Chynoweth, R. L. Milton, P.Cohen, B. Morris, AllanCross, M. D. Morris, PeterCunningham, B. T. (Teller) Morrison, W. L.Darling, E. E. Mountford, J. G.Duffy, M. J. O'Neil, L. R. T.Edwards, Ronald Punch, G. F.Everingham, D. N. Saunderson, J.Fatin, W. F. Scholes, G. G. D.Free, R. V. Scott, J. L.Fry, K. L. Simmons, D. W.Gayler, J. Snow, D. W.Gear, G. Staples, P. R.Griffiths, A. G. Steedman, A. P.Hand, G. L. Theophanous, A. C.Hayden, W. G. Uren, T.Hollis, C. Wells, D. McM.Howe, B. L. West, S. J.Humphreys, B. C. (Teller) Willis, R.Hurford, C. J. Young, M. J.Jones, Barry Aldred, K. J. Howard, W. M.Andrew, J. N. Hunt, R. J. D.Anthony, J. D. Lloyd, B.Braithwaite, R. A. McGauran, P. J.Burr, M. A. MacKellar, M. J. R.Cadman, A. G. McVeigh, D. T.Cameron, Ewen (Teller) Macphee, I. M.Carlton, J. J. Millar, P. C.Coleman, W. P. Newman, K. E.Connolly, D. M. O'Keefe, F. L.Dobie, J. D. M. Porter, J. R.Drummond, P. H. Robinson, IanEdwards, Harry Rocher, A. C.Fisher, P. S. Ruddock, P. M.Goodluck, B. J. Shipton, R. F.Groom, R. J. Sinclair, I. McC.Hall, Steele Spender, J. M.Hawker, D. P. M. Street, A. A.Hicks, N. (Teller) White, P. N. D.Hodgman, W. M. Wilson, I. B. C. Reeves, J. E. Fife, W. C.Dawkins, J. S. Lusher, S. A.Jacobi, R. Cowan, D. B.Child, J. Moore, J. C.Beazley, K. C. Tuckey, C. W. Question so resolved in the affirmative. Bill read a second time. Messages from the Governor-General recommending appropriations announced. Clauses 1 to 11-by leave-taken together, and agreed to. Clause 12 (Entitled to medicare benefit). Dr BLEWETT(Bonython-Minister for Health)(9.09) —I move: (1) Clause 12, page 7, lines 8 to 22, omit the clause, substitute the following clause: ''12. Section 10 of the Principal Act is repealed and the following section is substituted: Entitlement to medicare benefit '10. (1) Where, on or after 1 February 1984, medical expenses are incurred in respect of a professional service rendered in Australia to an eligible person, medicare benefit calculated in accordance with sub-section (2) is payable, subject to and in accordance with this Act, in respect of that professional service. '(2) A medicare benefit under sub-section (1) in respect of a professional service is an amount equal to- (a) 85% of the fee specified in respect of the service in the table in relation to the State in which the service is rendered; or (b) if the amount calculated under paragraph (a) is less by more than $10 than the fee from which it is calculated-an amount that is less by $10 than that fee. '(3) Subject to this Act, where- (a) a claim (in this sub-section referred to as the ''threshold claim'') for medicare benefit is made by a claimant in respect of a professional service- (i) which was rendered to a person, being either the claimant or another person (in this sub-section referred to as the ''patient''); and (ii) in respect of which the medical expenses are incurred by the claimant in a year, and the claim is accepted for payment by the Commission; (b) the claimant has, or another claimant or other claimants has or have, made other claims (in this sub-section referred to as the ''prior claims'') for medicare benefit in respect of professional services- (i) which were rendered to the patient; and (ii) in respect of which the medical expenses were incurred by the relevant claimant in that year, and the prior claims were accepted for payment by the Commission before the time when the threshold claim is accepted for payment (in this sub-section referred to as the ''relevant time''); and (c) the Commission is satisfied at the relevant time that- (i) the first-mentioned claimant has paid the medical expenses in respect of the professional service to which the threshold claim relates: (ii) a claimant has, or claimants have, paid the medical expenses in respect of professional services to which some or all of the prior claims accepted by the Commission for payment before the relevant time relate; (iii) the sum of the patient contributions in respect of the prior claims referred to in sub-paragraph (ii) is less than the relevant amount for that year ; and (iv) the sum of the patient contribution in respect of the threshold claim and the patient contributions in respect of the prior claims referred to in sub- paragraph (ii) is equal to or exceeds the relevant amount for that year, the medicare benefit payable- (d) in respect of the professional service to which the threshold claim relates -shall be increased by the amount of the excess (if any) referred to in sub- paragraph (c) (iv); (e) in respect of a professional service- (i) to which a prior claim accepted for payment by the Commission before the relevant time relates; and (ii) in relation to which the commission becomes satisfied, after the relevant time, that the claimant has paid the medical expenses, shall be increased by an amount equal to the patient contribution in respect of that claim; and (f) in respect of a professional service- (i) to which a claim for medicare benefit that is accepted for payment by the Commission after the relevant time relates; (ii) which was rendered to the patient; and (iii) in respect of which the medical expenses are incurred by the claimant in that year, shall be increased by an amount equal to the patient contribution in respect of that claim. '(4) Where an amount calculated in accordance with sub-section (2) is not a multiple of 5 cents, the amount of cents shall be increased to the nearest higher amount that is a multiple of 5 cents. '(5) For the purposes of sub-sections (3) and (6), but without prejudice to the meaning of an expression in any other provision of this Act- (a) where a person to whom medicare benefit is payable in respect of a professional service is given or sent a cheque under sub-section 20 (2) for the amount of the medicare benefit, the person shall be taken to have paid so much of the medical expenses in respect of that service as is represented by the amount of the medicare benefit; (b) the question when medical expenses are incurred in respect of professional services relating to prescribed items shall, notwithstanding anything in this Act, be determined in accordance with the regulations; and (c) a reference to a professional service is a reference to a professional service (including a medical service rendered outside Australia)- (i) in respect of which medicare benefit is payable; and (ii) the medical expenses in respect of which exceed the amount of medicare benefit that, but for sub-section (3), would be payable in respect of the service. '(6) In this section- ''patient contribution'', in relation to a claim for medicare benefit in respect of a professional service, means an amount equal to the difference between- (a) the fee specified in respect of the service in the table in relation to the State in which the service is rendered or, if the medical expenses in respect of the service are less than that fee, those medical expenses; and (b) the amount of medicare benefit that, but for sub-section (3), would be payable in respect of the service; ''relevant amount'' means- (a) in relation to a year, being the period of 5 months commencing on 1 February 1984-$62.50 or, if a higher amount is prescribed for the purposes of this paragraph, that higher amount; or (b) in relation to the year commencing on 1 July 1984 or a subsequent year-$150 , or if a higher amount is prescribed for the purposes of this paragraph in respect of that year, that higher amount; ''year'' means- (a) the period of 5 months commencing on 1 February 1984; (b) the year commencing on 1 July 1984; or (c) a subsequent year commencing on a 1 July.'.''. Clause 12 of the Health Legislation Amendment Bill sets out the rate of Medicare benefits which will be 85 per cent of the schedule fee, with a maximum patient payment of $10 for any one item where the schedule fee is charged. The same level of benefit will be payable for all types of patients and replaces the present confusing arrangements which provide for different levels of Commonwealth benefits according to type of patient and method of billing by providers. This essential component of Medicare will provide for equity, simplicity and efficiency. The move to a single level of Medicare benefit for all will mean a reduction in benefits presently payable for pensioner services and disadvantaged persons' services, with an increase in the maximum gap from $5 to $10. However, this will not affect benefits payable for most general practitioner consultations and the effect on other benefits is only marginal. Medicare benefits cover the full range of medical services, including treatment by specialists, surgery and diagnostic services-- Mr Carlton —Mr Deputy Chairman, I raise a point of order. The Minister has referred to an amendment circulated in his name. I am not aware of the amendment having been circulated. Dr BLEWETT —We had to rewrite clause 12. The DEPUTY CHAIRMAN(Mr Rocher) —I understand that the amendments were circulated in this chamber at about 11.10 this morning. Mr Carlton —With respect, if honourable members currently in the chamber do not have copies of the amendment before them, they can hardly debate the matter suitably. I have not been given the amendment during the time that I have been in the chamber. The DEPUTY CHAIRMAN —I am assured that copies were circulated and that they were provided in the chamber. Mr Carlton —May I suggest that copies be made available to those honourable members currently in the chamber so they will be able to debate this matter. Some honourable members may not have been in the chamber at the particular hour at which the amendment was circulated. The DEPUTY CHAIRMAN —I draw the honourable member's attention to the amendments placed at the end of the table, which are available for the use of members. Dr BLEWETT —As I was saying, Medicare benefits cover the full range of medical services, including treatment by specialists, surgery, and diagnostic services such as radiology and pathology. They are also payable for medical benefits rendered to in-patients of public and private hospitals, for certain surgical and orthodontic procedures rendered by approved dental surgeons, and consultation services rendered by participating optometrists. The amendment I have moved makes no change to the provisions currently set out in the Bill. However, the Australian Democrats in another place drew attention to the fact that the original clause 12 of the Bill could impose some financial hardship on individuals who suffered from chronic illness or disabilities. Such hardships would come about because of their requirement for regular medical treatment involving on each occasion the payment of a patient contribution of a maximum amount of $10 for each medical service where the schedule fee was charged. While we believe it is more appropriate for doctors to direct bill Medicare for chronically ill people who run up large medical bills and accept that payment in full settlement, we recognise that not all doctors would do this. The Government, in considering the Democrats' proposal, also recognised that, in addition to those with chronic illness, there are occasions when individuals may suffer catastrophic illness which may involve a large number of medical services during the acute phase of the illness. The Government considers that such individuals should also receive protection against the financial burden imposed by such an illness. The proposed amendment would provide protection for each Australian against any substantial medical costs which must be met by patients in excess of the Medicare medical benefit at 85 per cent, with a maximum of $10 for each service. The amendment proposes that where a person by way of patient contributions is required in any one year to meet aggregate patient contributions of more than $150, being made up of differences between the Medicare medical benefits and the fee charged by the medical practitioners, where these fees are equal to the schedule fee or less, the Medicare medical benefit in respect of medical expenses incurred in that year will be payable by the Health Insurance Commission at the rate of the full medical benefit schedule fee. This means that after the patient has paid an aggregate amount so that the $150 threshold in any one year has been reached, a person will not be required to meet the difference between the Medicare medical benefit and the schedule fee for the remainder of the year. This difference will be paid as an additional Medicare benefit so that each service received will attract a medical benefit of 100 per cent of the schedule fee. This will also apply to Australian residents who have medical services rendered to them overseas. It would not apply to assigned medical benefits accepted in full payment by the practitioner for the service rendered, since there is no patient contribution in such circumstances. In respect of the period from 1 February 1984 to 30 June 1984, that is, the transition period, the full year amount of $150 will be adjusted on a pro rata basis to ensure that individuals are not disadvantaged in the first five months operation of Medicare . The Government considers that the proposed amendment provides substantial protection against episodes of substantial medical costs for all Australians and , in particular, those unfortunate Australians who, because of chronic illness, require regular medical treatment. I commend the amendment to the House. Mr CARLTON(Mackellar)(9.15) —I refer to the provisions in original clause 12 of the Health Legislation Amendment Bill, together with the amendment moved by the Minister for Health. I point out to the House that this clause is the one which extends the Government contribution to medical services in Australia from 30c in the dollar to 85c in the dollar on the schedule fee. This is a critical clause in the Bill as far as we are concerned because it is one of the clauses which shift substantially the role of the Government in intervention in health care delivery in Australia. It is also a clause which extends substantially the clawing back of tax from people in the community for health services, as opposed to the provision of health services by private insurance or by private payment. The additional cost in a year of extending the Commonwealth contribution to the medical service in each individual case from 30c in the dollar to 85c in the dollar is of the order of $800m. It makes up a considerable proportion of the $1 .7 billion additional tax raised from taxpayers in Australia to bring in this Medicare measure. We have the strongest possible objection to this clause. We propose to vote against it. We make it absolutely clear to the House and to the Australian people that we are totally opposed to extending the intervention of the Government into every single medical service from a 30c in the dollar subsidy to an 85c in the dollar subsidy. Let the stand we are making on this particular clause be perfectly clear. The amendment that the Minister has moved to this clause represents the 'substantial' concession wrung from the Minister by Senator Haines of the Australian Democrats. This is the amendment by which the Minister fulfils his contract with the Australian Democrats and enables them to salve their consciences in letting through the Senate last week the Health Insurance Commission regulations. This is the clause which the Australian Democrats will point to as their victory as they preside over the sacking of 5, 000 employees in the private health insurance funds. This amendment will apply to anybody who amasses a total in one full year of $ 150 in gaps. The technical side of this may not be clear to all. If the sum of gaps between what the Government pays-the 85 per cent-and the schedule fee, over a series of medical consultations or procedures totals more than $150 in one year, the Government comes to the aid of the medical practitioners subsequently serving that patient and pays 100 per cent of the schedule fee thereafter. I point out to the House one particular quirk of this procedure. In the five months from 1 February that this will operate during the current financial year, the limit in this case of the sum of gaps is only $62.50. This means that anybody who undergoes any major surgical procedure in a hospital, with substantial medical attention during that period, with prior consultations, surgery visits and various items of attention by doctors in a hospital, may easily amass a total within the first couple of months of that five months period of $62.50 in gaps, if we can call it that. That means that from then until the end of the financial year the person concerned can go to any doctor, who will receive 100 per cent of the schedule fee direct from the taxpayer by agency of the Government. In the subsequent year it will be $150 before that position is arrived at, but again similarly it is possible in any major incident for a person to amass the $150 and thereafter practitioners are able to get 100 per cent of the schedule. What is overlooked in this by Senator Haines of the Australian Democrats and possibly by the Minister, although I do not believe it would have been overlooked by the Minister because he treated the Australian Democrats so cynically in this exercise as he did with the post box proposal for the passing on of Medicare claims, is that it would be quite possible to meet Senator Haines 's original request-to allow the private health funds to insure for the gap-at much less than $150 a year. Was that ever asked of the private funds? Did Senator Haines even for a moment consider that the Minister might have been fobbing her off instead of putting this across to private funds as a possible way of extending their business and saving a few jobs at the edge? Was it even considered that the Minister might, with his alternative proposal, extend the government funds, that is, the taxpayers' funds, by $10m instead of saving jobs in the private funds? We totally oppose the procedure whereby the Government will intervene not to the extent of 30c in the dollar for each surgery consultation or medical procedure but to the extent of 85c in the dollar, with the clear intention of making the 85 per cent 100 per cent and thereby controlling the medical profession. We are totally opposed to the extension in a year of the use of $800m of taxpayers' funds to bring this about. We think it is a thoroughly bad deal. We totally oppose this amendment and we shall vote against it. Mr FREE(Macquarie)(9.22) —I support the amendment moved on behalf of the Government and deplore what is clearly intended to be a series of divisions by way of clause by clause opposition to this important package of Bills. The behaviour of the Opposition is similar to the behaviour of the Opposition during the period when the original Medibank package was introduced, and there is no doubt that this opposition will continue throughout the evening. That is a great pity because, if ever a policy was carefully developed, thoroughly researched and patiently communicated, it is Labor's health program. There is no doubt that this policy is accepted by the public and that it will bring back to health insurance those features of simplicity, fairness and universality so sadly lacking for most of the past seven years. The introduction of Medicare will return health insurance arrangements to those original Medibank principles, this time with a levy instead of general revenue funding. It will bring to an end a period of change and conflict extending over 15 years. Mr Fisher —Mr Deputy Chairman, I take a point of order. I do not believe the honourable member is referring to clause 12 in his remarks. The DEPUTY CHAIRMAN(Mr Rocher) —I remind the honourable member for Macquarie that we are speaking to an amendment to clause 12. I have been listening carefully and waiting for him to get to the point. I would ask him to do so. As he is not continuing I call the honourable member for North Sydney. Mr SPENDER(North Sydney)(9.24) —I wish to raise one or two points on which the Minister may be able to help me. First of all, the Minister said that the amendment which has just been circulated deals with catastrophic cases, when a number of visits or occasions of medical attention may be required, or with chronic cases. I have not had time to read the proposed amendment adequately and to tie it into the balance of the Bill and the principal legislation. Can the Minister tell the Committee where, by definition as it were, catastrophic or chronic conditions are brought into operation in respect of proposed new section 10? Secondly, can he inform the Committee whether the proposed amendment would apply where a charge in excess of the relevant fee specified is made by a doctor and paid, assuming one reaches the relevant amount for the year? Thirdly, has the Government costed the effect of these proposals? If so, were they included in the Minister's original second reading speech? If not, what are the additional costs of the proposals? Mr NEWMAN(Bass)(9.26) —I would like to take up this question of the 85 per cent arrangement. The point made by a number of speakers on this side of the chamber this afternoon and this evening is that this is an open invitation to doctors who are that way inclined to overservice. The problem is that many doctors now, even those who have very large bulk billing practices, will see this as a reduction in their fees. If one accepts the proposition, which I think is a fair proposition, one would have to agree that market forces will force most doctors to bulk bill in the medium term. Some doctors faced with a reduction of between 5 per cent and 15 per cent in their incomes will overservice. I really am interested to know what new measures there will be to check overservicing. I think honourable members will appreciate that there are many ways in which a doctor can quite legitimately increase the amount of consultation he engages in. For example, in the case of a common problem in an ear, something to which children are prone, a general practitioner, having had one consultation, would probably take a look at the child and say to the mother: 'If this discharge from the ear continues, give me a ring and I will see the child again'. In that way he would probably be acting fairly reasonably. But now, trying to make up this gap in income, he will probably say to the mother: 'That discharge does not look too good. You had better come back next week'. There is no way in which computers or an extra $8m of investment in checking doctors' overservicing will pick that up. The point I make is a very important point: What will the Government do to check on this incentive to overservice? Ms MAYER(Chisholm)(9.29) —The 85 per cent of the schedule fee is now accepted by most doctors when they direct bill in respect of pensioners. That amount of the schedule fee is reasonable if one accepts, as we do, the recommendation of the Jamison Commission of Inquiry into the Efficiency and Administration of Hospitals that patients should have some responsibility for the health care they receive; and 15 per cent of the schedule fee represents an amount of money which it is not too difficult for most people in this area to pay. I do not believe there will be an incentive to overservice. In fact I am surprised that the Opposition has such a shady view of doctors in the community. Certainly the medifraud inquiry has revealed that not all doctors are as honest or as straightforward as we would hope they would be. However, the people turned up by the fraud and overservicing detection service do not represent the majority of doctors or even a very large minority of doctors, but very few indeed. I do not believe that a medical service such as this will simply be abused by doctors in the way in which the Opposition is so certain it will. Mr Newman —You are naive. Ms MAYER —Perhaps that belief is naive but I think that basically it is very strange for people on the one hand to cry about fees for service and the rights of doctors in private practice and on the other hand to slander every doctor in private practice in this country. Given the 85 per cent contribution from Medicare, the 15 per cent patient contribution will be made by people whose income is over $128 a week for single people and $214 a week for married couples . Thus the one per cent levy will mean that the very large group of people on very low incomes who at present pay very high health insurance will now pay a very small amount through their Medicare levy and an equally small amount on top of the 85 per cent of the bill if the doctor does not care to direct bill. I think that with the efficiency of the Health Insurance Commission and the reduction of the gap between claim and payment, doctors will be direct billing a great deal more than they are now. The convenience for the patient is one thing to which I am sure doctors will give some consideration. I think they will also give consideration to the cost for chronically ill patients. The limit of $150 which a chronically ill patient must pay to the doctor before Medicare benefits come in at 100 per cent is a fairly high cost for some people. One hopes that doctors will be conscious of the cost in a financial year of $150 to people who may find it difficult to pay-the chronically ill patients for whom they care on a consistent basis. One hopes they will direct bill those patients. One hundred and fifty dollars is the total amount which a chronically ill patient who can afford to pay will have to pay for medical services in any financial year. That total is much smaller than that which many chronically ill patients are paying now for their health care. I believe that this amendment is one of the very important parts of the Bill. It should be passed. Mr CONNOLLY(Bradfield)(9.32) —I must respond to some of the comments made by the honourable member for Chisholm (Ms Mayer). First, I draw her attention to the report of the Joint Committee of Public Accounts on Medical Fraud and Overservicing. I do not know whether she has read it but from the comments she has just made I rather doubt that she has. I think it contradicts quite clearly some of the observations she was making. My colleague the honourable member for Mackellar (Mr Carlton) has been making the very important observation that clause 12 is fundamental to this legislation. It is for that precise reason that the Opposition is objecting most strongly to the philosophical background to it. One can demonstrate easily that most people are attracted to the concept of ' getting something for nothing'. Unfortunately, that seems to be a pretty normal human reaction. As my honourable colleague pointed out, the simple fact is that the increase in the cost from 30c to 85c in the guaranteed coverage from the Medicare fund will cost revenue $1.7 billion this year. It is all very well to suggest- Dr Everingham —Mr Chairman, I take a point of order. Is this relevant to the clause? The DEPUTY CHAIRMAN(Mr Rocher) —I believe from what I have heard so far that it is. Mr CONNOLLY —The additional cost which will be required to apply this amendment to clause 12 will ultimately have a major impact on the overall cost of the delivery of health services to the Australian people. I would be grateful if the Minister for Health (Dr Blewett), who is at the table, would approve the inclusion in Hansard of the table contained on page 136 of the report of the Public Accounts Committee which refers specifically to the medical benefits schedule, which demonstrates quite clearly that unless the Government is prepared to make reforms in those areas as well as meet overall cost of services being given by doctors and the medical profession generally, one is opening up a situation which will be virtually out of control. I seek leave to have the table incorporated in Hansard. Leave granted. The table read as follows- TABLE 11: CHANGES BETWEEN 1958 AND 1978 IN THE COMMONWEALTH MEDICAL BENEFIT REFUND SCHEDULE Number of Items Concerned With Service Type of Item Service Type 1958 1978 Attendance by doctor 4 47 Obstetric service 13 30 Other surgical procedures 700 1 300 Radiology services 50 150 Pathology services 200 250 Anaesthesia 5 100 Mr CONNOLLY —The linkage between proving financial support through Medicare and the medical benefits schedule is fundamental to this question. I urge the Minister to give it further consideration. Mrs DARLING(Lilley)(9.34) —Briefly I want to speak very strongly in support of this amendment. It is about time some money was put forward to help those who are chronically ill and who have been carrying a very heavy burden in past years . I am fascinated by some of the comments made by members of the Opposition. They really should get their act together. The honourable member for Bradfield ( Mr Connolly) said that people are getting something for nothing. But many of his colleagues have been saying that the amount the Government is collecting from the levy is too much. The honourable member for Mackellar (Mr Carlton) said that he does not like intervention by government into medical services but I remember that when he was Minister for Health he absolutely loved intervention. In fact, he intervened to the detriment of all pensioners by bringing in a very confusing number of prescription forms which caused trauma and which were against the interests of those people. Mr Connolly —Mr Chairman, I take a point of order. I ask that the honourable member be brought back to the clause. The DEPUTY CHAIRMAN(Mr Rocher) —I think that the honourable member for Lilley has made a fair enough debating point. As long as she does not dwell on it too long she is in order. Mrs DARLING —It is my opinion that if members of the Opposition can bring forward a point and talk about it at length, as the honourable member for Mackellar did, members of the Government should be able to answer it. My point is just as relevant. I thought the point brought up by the honourable member for Macquarie (Mr Free) was relevant. I do not like the ruling you just made, Mr Deputy Chairman. I would dissent from it. The DEPUTY CHAIRMAN —If the honourable member wishes to dissent from my ruling she may do so. If she wants to reflect on the Chair I remind her that she might very well be in the same position herself. I ask her to reconsider that remark. Mrs DARLING —I certainly do not wish to put you into an awkward position, Mr Deputy Chairman. I will not continue with that point but I certainly imagine that you will accept that I can answer things which are brought up within this debate. The DEPUTY CHAIRMAN —I say again to the honourable member for Lilley that I did rule in her favour on the last point of order. She may proceed. Mrs DARLING —Thank you, Mr Deputy Chairman. A number of Opposition members were also concerned about the cost of bringing in such an amendment in the interests of people. But I point out that again they are not being consistent when one considers that it would cost $30m extra per annum if we were to introduce Medicare and administer it through the private funds which the Opposition members have persistently called for. In other words, they do not mind spending money. They do not mind adding a couple of billion dollars more to a deficit but what they do not like is spending it in the interests of people in very sound legislation such as this. I commend the Minister for Health (Dr Blewett) for his forethought, ability and compassion in bringing forward this amendment. I thoroughly support it. Mr SPENDER(North Sydney)(9.39) —I take up very briefly a point which was made by the honourable member for Bass (Mr Newman) on the question of overservicing. One has a mass of anecdotal evidence about what happens in other parts of the world. One knows that if a service provided is effectively not charged for, such as in this case, there can be a very large tendency to overservice. For example, the same person may see her doctor or take her child to the doctor more frequently than she would otherwise. The honourable member for Bass put that kind of example before the Committee. In my speech in the second reading debate I put to the Minister for Health the proposition that he might see not just a change in the profile of individual doctors but, as it were, a change in the profile of the industry. By that I mean a higher degree of servicing generally might start to spread throughout the medical profession. I am not being critical of the medical profession; I am just making an observation about human nature. That sort of thing can happen. I would like to know whether that point has been considered by the Minister. What kind of checks can he make against that sort of overservicing if, as I think is very likely, that takes place? I would be glad if the Minister would give us his views upon that matter. Dr THEOPHANOUS(Burke)(9.42) —First of all, I totally reject the earlier comments by the honourable member for Bradfield (Mr Connolly) which reflected on the honourable member for Chisholm (Ms Mayer) in relation to the medifraud report. The honourable member for Chisholm is a member of the Joint Committee of Public Accounts. Since she was elected to that position she has taken a very great interest in the medifraud situation. That sort of comment need not have been made. We are talking about the possible difficulties of overservicing in relation to this clause and in relation to the Medicare scheme. I say this about the overservicing situation: First of all, it was many years before the honourable members sitting opposite even realised that an overservicing problem was arising in the medical profession. In fact, had it not been for independent sources coming up with the problem of overservicing we would not even have had a Public Accounts Committee inquiry into the matter. The honourable member for Bradfield knows very well that when these problems of overservicing were being raised under the previous Government we worked in a bipartisan fashion in an attempt to achieve rules and guidelines which would put an end to the problem. Recommendations have been made to the Government by the Public Accounts Committee. This Government and this Minister for Health have acted more quickly on these recommendations than did all the previous Ministers for Health in relation to previous recommendations. Mr Newman —List them. Tell us what they are, one by one. Dr THEOPHANOUS —The Minister has made several statements about the measures to be taken and legislation will come forward at some future time to make sure that this problem is dealt with. Let us deal with the proposition which has been put by two members of the Opposition tonight, namely, that it is human nature to be greedy and therefore that all doctors ought to be condemned. Mr Deputy Chairman, even at the time-- Mr Connolly —Mr Deputy Chairman, I raise a point of order. The honourable member suggested that a certain comment was made by me. I totally reject that suggestion. The DEPUTY CHAIRMAN(Mr Rocher) —There is no point of order. Dr THEOPHANOUS —The honourable member made a comment about it being human nature for everyone to misuse the system. Did he or did he not make that comment about human nature? He certainly did make that comment. Mr Connolly —Mr Deputy Chairman, I raise a point of order. The honourable member has suggested that I said that all doctors were greedy. I reject that observation by him. I did not say that; nor did I even imply it. The DEPUTY CHAIRMAN —Order! There is no point of order. Mr Robert Brown —I take a point of order, Mr Deputy Chairman. I am concerned that the honourable member for Bradfield should be showing such contempt for the Standing Orders and for your ruling. The DEPUTY CHAIRMAN —There is no point of order. Dr THEOPHANOUS —It appears that the honourable member for Bradfield is a little sensitive. He should be more careful about making those sorts of comments. I do not think anyone on the Public Accounts Committee could be accused of being more enthusiastic about stamping out medifraud and overservicing than I was. Nevertheless, I never went to the point of condemning all doctors in relation to this matter or of talking about it being human nature. If procedures are put into place, those procedures will prevent overservicing. The Minister and this Government are determined that this shall happen. Opposition members have raised the matter of overservicing in the context of this clause when it was a problem that existed very much under its administration of its various health systems. I would argue that under the provisions of this clause the possibility of overservicing will be reduced rather than increased, particularly in comparison with the sorts of mad systems which operated under the previous Government. I strongly support the clause. I say to the Opposition: Stop raising these red herrings and irrelevancies about overservicing. We all know the conservatives view of human nature, which is that everyone is mad greedy and trying to take over everyone else. This conservative view of human nature, which has gained some currency among certain pop philosophers in recent times, is totally erroneous and we in the Australian Labor Party reject it. Dr BLEWETT(Bonython-Minister for Health)(9.48) —I just make a few brief comments about the contributions to this discussion. First of all, I am very grateful to the honourable member for Mackellar (Mr Carlton) for having torpedoed much of the argument of his Party in the second reading debate. The Committee will remember that Opposition members were busily arguing that the levy will account for only roughly $1,000m of the $8 billion health bill but the honourable member for Mackellar, in his argument, showed quite clearly that exactly the same is true of health insurance. The present health insurance system does not cover anywhere near the total bill of this country. We have never pretended that the levy will cover the total health bill of this country, just as this Opposition, when it has been honest, has never pretended that the health insurance provisions covered the whole health bill of this country. That point quite satisfactorily deals with one of the major arguments of the Opposition during the second reading debate. As the honourable member for Mackellar rightly pointed out, the Government already pays half the medical bill of this country. When we allow for the 30 per cent Commonwealth cover for everybody and the full cover for pensioner and health care services, we see that already 50 per cent of the bill is paid. All we are doing in this legislation is extending that payment to 85 per cent and funding it in a much fairer way by means of an income related levy. The second point made by the honourable member for Mackellar was his kind of satire on the 'substantial' concessions made to the Australian Democrats. All he talked about was this one concession-and he mentioned the post box; I give him that-and he did so as though that constituted the understandings we made with the Democrats. But, unlike the Opposition, the Democrats have been willing for months to talk with the Government about the problems of this measure. Of course , many of the earlier concessions are already in the Bill; that is, that we should deregulate the private funds considerably to meet many of their demands and place restrictions on the competitive ability of Medibank Private so that it did not piggyback on Medicare. All of those arrangements are part of a much broader set of concessions and agreements that has been made with the Democrats. So, to come here and sneer because there is only this one amendment ignores utterly the agreements and understandings and the quite sensible arguments produced on a range of issues with the Democrats. Let me now deal with the three questions raised by the honourable member for North Sydney (Mr Spender). We define 'chronic' in terms of people reaching that threshold. We have found it impossible to define chronic illnesses as such, and therefore we have a used a threshold basis; that is, a number of gaps. When it reaches $150, this will certainly cover people with chronic illnesses, and people who may have major surgery, or major accidents. We can do nothing about doctors who charge in excess of the schedule fee, just as the present health insurance system can do nothing about them. We are talking only about the gap between 85 per cent and the schedule fee. The approximate cost of the concession is $8m in a full year. The other point raised by the Opposition on this clause is the question of overservicing. No doubt that issue will arise again. I make one general point about overservicing-particularly for the honourable member for Bass (Mr Newman). Overservicing is, in essence, a problem of an insurance system, and not a problem of either a public or a private insurance system. All the evidence is that it occurs under any form of insurance system. It does not seem to make much difference whether it is public or private; we have much the same problems. For instance, one of the disadvantages of the present system is that gap insurance is a way of encouraging overservicing, because if the doctor charges the schedule fee, the patient has nothing to pay in that situation. I accept this problem as a serious problem but not a problem particularly related to a public insurance system as against a private insurance system, because of the problems that have existed under the present system, with its private insurance system. Mr Newman —Except that you reduce their income, if you succeed. Dr BLEWETT —I shall come to the reduction of income shortly. The Joint Committee of Public Accounts drew attention to the fact that the only statistical analysis that had been carried out on bulk billing showed that there was no greater use of services where doctors bulk billed as compared with patient billing; that is, where doctors were already bulk billing-about 30 per cent to 40 per cent of all services are already bulk billed-those doctors did not feel, because they were bulk billing, an inclination or desire to overservice their patients. This means again that doctors exaggerate the kinds of cuts that might be produced in their income by these proposals, because even if they all bulk billed it would not be 15 per cent over their present situation, because their present situation already involves a large amount of bulk billing. Mr Newman —But for someone bulk billing 70 per cent, the calculation is that they would be down about 8 per cent. Dr BLEWETT —Right; then there would be the possibility that it would be done in that way. On the other hand, we know that because there are about two million people in the community who are uninsured, there is a considerable amount of sickness being untreated. In the estimates of costs we have made for next year we expect some increase because those people fearful now of visiting their doctor will come in. So in that sense the doctors benefit; they benefit, of course, in the ending of all bad bills, bad debts. So I doubt whether there will be any serious repercussions for doctors' incomes, for doctors who will charge a majority of their services by direct billing. That does not mean that, just as under the present system, we shall have the same problem of overservicing under the future system. I shall be making a major statement to the Parliament next month about proposals concerning overservicing-for many of which I would be perfectly prepared to give credit to the honourable member for Mackellar (Mr Carlton), who laid many of the foundations of the actions which we are taking, although he does not seem to be so keen on the policies that we here help to initiate. Question put: That the amendment (Dr Blewett's) be agreed to. The Committee divided. (The Deputy Chairman-Mr A. C. Rocher) Ayes . . . . . . . . . . . 63 Noes . . . . . . . . . . . 40 —— Majority . . . . . . . . . 23 —— Baldwin, P. J. Jones, BarryBeddall, D. P. Keating, P. J.Bilney, G. N. Kelly, R. J.Blanchard, C. A. Kent, L.Blewett, N. Keogh, L. J.Bowen, Lionel Kerin, J. C.Brown, John Klugman, R. E.Brown, Robert Lindsay, E. J.Brumby, J. M. McHugh, J.Campbell, G. McLeay, LeoCharles, D. E. Maher, M. J.Charlesworth, R. I. Mayer, H.Chynoweth, R. L. Mildren, J. B.Cohen, B. Milton, P.Cross, M. D. Morris, AllanCunningham, B. T. (Teller) Morris, PeterDarling, E. E. Morrison, W. L.Duffy, M. J. Mountford, J. G.Edwards, Ronald O'Neil, L. R. T.Everingham, D. N. Punch, G. F.Fatin, W. F. Saunderson, J.Free, R. V. Scott, J. L.Fry, K. L. Simmons, D. W.Gayler, J. Snow, J. H.Gear, G. Staples, P. R.Griffiths, A. G. Steedman, A. P.Hand, G. L. Theophanous, A. C.Hollis, C. Uren, T.Howe, B. L. Wells, D. McM.Humphreys, B. C. (Teller) West, S. J.Hurford, C. J. Young, M. J.Johnson, Les Aldred, K. J. Howard, J. W.Andrew, J. N. Hunt, R. J. D.Anthony, J. D. Lloyd, B.Braithwaite, R. A. McGauran, P. J.Burr, M. A. MacKellar, M. J. R.Cadman, A. G. McVeigh, D. T.Cameron, Ewen (Teller) Macphee, I. M.Cameron, Ian Millar, P. C.Carlton, J. J. Moore, J. C.Coleman, W. P. Newman, K. E.Connolly, D. M. O'Keefe, F. L.Dobie, J. D. M. Porter, J. R.Drummond, P. H. Robinson, IanEdwards, Harry Ruddock, P. M.Fisher, P. S. Shipton, R. F.Groom, R. J. Sinclair, I. McC.Hall, Steele Spender, J. M.Hawker, D. P. M. Street, A. A.Hicks, N. J. (Teller) White, P. N. D.Hodgman, W. M. Wilson, I. B. C. Reeves, J. E. Fife, W. C.Dawkins, J. S. Lusher, S. A.Jacobi, R. Cowan, D. B.Beazley, K. C. Tuckey, C. W. Question so resolved in the affirmative. Clause, as amended, agreed to. Clauses 13 to 17-by leave-taken together, and agreed to. Clause 18 (Medicare benefit not payable in respect of certain medical expenses) . Mr CARLTON(Mackellar)(10.03) —In relation to clause 18 the Minister for Health (Dr Blewett) in his second reading speech drew attention to the concern expressed by the Government about the private practice arrangements of medical practitioners in hospitals, which of course are part of the State delivery systems. The Minister said: The concerns about the operations of private practice rights particularly relate to diagnostic services and some therapeutic services-pathology, radiology , radiotherapy and nuclear medicine-where there is not usually any direct doctor -patient contact, where there is substantial scope for generating additional revenue, and where there is a significant technical content to the service which is provided by the hospital rather than the doctor. On those grounds the Minister suggests that the medical benefits will not be paid by Medicare unless the Commonwealth Minister has approved the contract in each individual case entered into by the hospital with the doctor. This can apply to contracts written before the time of this Bill. The Opposition understands quite well that there may be a capacity, in certain situations such as this, for an excessive draw to be made on Commonwealth benefits. That may well be a concern, but the Opposition is very much concerned that the Federal Government should be returning once again to interfere directly in the delivery practices of the State governments and their hospitals and that it should be up to the Federal Minister, advised by the Commonwealth Department of Health, to pass these contracts between doctors and hospitals. I think the Opposition's concerns about this would not be quite so great if the Minister had not demonstrated such an extraordinary view of the doctor-patient relationship in certain of these specialities. It is quite understandable that in pathology there may well not be such a close relationship between the practitioner and the patient. The specimens are sent to a laboratory, the pathologist in charge has various technicians in the laboratory, and there may well, in most cases be no contact with the patient, although in a hospital there is more likelihood of there being that kind of contact. We are talking about hospital pathologists. But to say that there is very little relationship in radiology, radiotherapy and nuclear medicine displays a very peculiar view of the doctor-patient relationship. Anybody who has visited the major hospitals and seen the oncology units, the operation of computerised axial tomogram scanners, and the professionals in these areas making their professional judgments about and dealing with patients I think would be amazed at the statement made by the Minister in his second reading speech. Also I think those in the professions who read the second reading speech of the Minister would be gravely concerned, particularly if they were radiologists, radiotherapists and nuclear medicine practitioners operating in hospitals, that it has been suggested that they have little contact with the patient. The Minister says that there is a significant technical content to the service provided by the hospital rather than the doctor. Certainly in the last three cases the significant technical content is in the nature of the high capital cost machinery which is involved in these services. However, if the person who has the skills is being relegated to a mere servant of those machines , that person would have very grave cause for affront. We are concerned about this and also about the fact that in clause 18 (1) (b), proposed new sub-section (4) (c) seems to be a requirement that the guidelines formulated by the Minister in this case should be published in the Commonwealth of Australia Gazette, but we see no reference to any capacity for parliamentary disallowance of those guidelines. I seek the Minister's information on this matter. Is it the intention in the provisions contained in clause 18 (1) (b), proposed new sub-section (4) (c), to have any capacity for parliamentary disallowance of those guidelines? If the Federal Department is to intervene in the local situation to this extent, at the very least the Federal Parliament ought to be able to oversee that process, particularly since it would have some concern about the Minister's rather peculiar view of at least three of the four specialities. Also, it is not clear to me-perhaps the Minister can also advise about this- whether this provision could be extended to cover visiting specialists, not just the staff specialists within the hospital. That is an important point I would like to have clarified because it is not absolutely clear to me whether visiting specialists are excluded. Mere statements of good intention would not be enough. I would like to be assured that this matter is covered within the provisions of this clause and that it does not relate to visiting specialists. There would be very serious problems with visiting specialists, particularly in country areas, if a provision of this nature were to appear. As the provision stands, we have grave concerns about this clause. We seek assurances about some of it, but I am not certain at all that even those assurances would be sufficient for us to concur with it. Dr BLEWETT(Bonython-Minister for Health)(10.10) —I will respond briefly to the points made by the honourable member for Mackellar (Mr Carlton). First of all, I think it should be pointed out that these decisions have been developed in co- operation with the States and are really part of the arrangements with each State government. In fact most of the State Ministers were eager for us to move in this direction and the guidelines have been developed in co-operation with them. It is not the intention that they be formed in regulations because it is part of the co-operation with the State health Ministers, who have a direct relationship with the doctors concerned in this case. That answers the first point that the honourable member raised. Secondly, on my odd notions about the medical profession in this field, I have relied very much on guidance from the State health Ministers, both in drawing up these guidelines and in gaining information about the services performed. I think that the honourable member for Mackellar ignored the relationship, for instance, between radiographers and radiologists. Much of the radiologists' work is interpreting what is being done by radiographers, so the relationship I talked about seems to apply to radiologists and, honourable members opposite admit, to pathologists. It may not be applicable to a couple of other groups. Finally, I assure the honourable member for Mackellar, although he may be upset by this, that these provisions also include visiting specialists, although, of course, they are somewhat different. Mr MacKELLAR(Warringah)(10.12) —I seek further clarification by the Minister for Health because from my reading of this provision he seems to be saying that he will take particular action against certain sections of the medical profession, particularly in this case the radiologists. The general thrust of the argument seems to be that radiologists use up an excessive portion of health expenditure. In fact, I think it represents a bit less than 7 per cent of total health expenditure. There is a suggestion that radiologists generate extra income by multiple servicing whereas radiologists do only the work that other doctors ask them to do. I refer to the personal relationship between radiologists and patients. There seems to be a suggestion that radiologists peform services for doctors rather than for patients. This is a very sterile argument because what the radiologist is doing is coming in very close contact with the patient and is performing a service for the patient, as are the other doctors treating that patient. I know that radiologists believe that they are being discriminated against as providers of diagnostic services by the suggestion that special conditions be put into their contracts. I would like to hear from the Minister why this apparent discrimination is to be practised. If this is going to be the case the crunch will come not so much in the big teaching hospitals but in the non-teaching hospitals where work is being done on a visiting medical officer basis. If it is alleged that a doctor is double dipping in respect of moneys earned by hospital patients being treated on a contractual basis and private patients being treated at the same time, I think that rather than discriminate against the radiologists this problem could be more easily overcome by writing contracts only for work done on hospital patients and leaving the fee for service arrangements inplace for private patients in public hospitals. It seems to me that there is a suggestion of discrimination against radiologists and some other medical specialists. I would like the Minister to outline whether this is the case. If it is, it could be that it is the thin edge of the wedge and the radiologists and pathologists are being used as whipping boys to gain public approval for this act, with a view to later including other specialities in these arrangements. Mr CONNOLLY(Bradfield)(10.15) —Clause 18 of the Health Legislation Amendment Bill is very significant because it demonstrates the concern, which is to a large degree legitimate, that any government has to face in relation to technology in the medical profession. Having said that, however, I agree entirely with my colleagues in emphasising the fact that specialists in the fields of pathology, radiology, radiotherapy and nuclear medicine have every reason to feel that the provisions included in the Act under clause 18 may unfairly discriminate against them. Notwithstanding that, there is a problem that if doctors, who are either in full or part time service with a hospital and who also in relation to their contract of service have opportunities to take private patients using the facilities of the hospital some recompense must be made to the hospital for those facilities. Of that there is no doubt. The problem rests on the question of whether hospitals have in the past had sufficient incentive to apply a more disciplinary approach to the doctors in their employ to see that the financial structutes upon which hospitals have been providing the very expensive technology which has been used by the doctors for their private patients does bring back to the hospital a reasonable return. It has been pointed out that under present arrangements States do set the paramaters for Commonwealth benefits. Because of this one could argue that the hospitals have never had the incentive to encourage doctors to meet cost requirements which ultimately benefit the Commonwealth because it keeps costs down. Nevertheless, the schedule fees obviously can be adapted from time to time to take this matter into account. The Opposition fears that in the draconian approach which the Government has taken it has not looked at some of these alternatives which need to be considered. The other question raised is in relation to the specifics of the contract which has been proposed by the Government. One could ask whether this contract will meet the requirements for the provision of specialist services, especially in country areas. I note in the second reading speech of the Minister for Health ( Dr Blewett) that he made the point that conditions for visiting diagnostic specialists could be made more equitable when compared with those proposed for salaried staff. I trust that he has the situation of country hospitals in mind. Quite clearly an agreement or a contract of services which may apply to a large metropolitan hospital could well not apply to circumstances outside metropolitan areas. Consequently, while the whole question of diagnostic services being provided under private practice contracts by full time specialists is an issue and one which the Opposition agrees needs to be given some consideration, we do not believe that it should be taken out of the context of the relationship which rightly should exist between a doctor and his patient, on the one hand, and at the same time the fiduciary relationship which should exist between the doctor and his employer, which in most cases is the hospital. Mr CARLTON(Mackellar)(10.13) —The Opposition approached clause 18 of the Health Legislation Amendment Bill with an open mind and sought information from the Minister for Health. But having heard his response I must say that none of our concerns were met; indeed, our alarm has been increased by a substantial measure . What the Minister has said is this: This clause enables the Commonwealth Department of Health, or the Commonwealth Minister advised by the Commonwealth Department, to set the arrangements between hospitals and specialists of any kind, not just the ones mentioned in the second reading speech. I presume it means any doctor in a hospital, a visiting doctor or a salaried doctor. The only way in which we are assured that this is a satisfactory arrangement is that it is a deal between Federal and State Ministers for Health. One of the requirements of the draft contract that has been agreed on with State Ministers is that all charges are to be at or below the schedule fee. That means that any visiting specialist who performs a superior task will be able to charge above the schedule fee. We would hope that, in our society, it is not considered impossible for that to be so. That is something which we would hold as important in order to encourage excellence in professions. That is one of the requirements. It applies therefore to any specialist, or probably to any doctor, or to any visiting specialist to a hospital as well as to salaried doctors. It might be agreed between Federal and State Ministers at some conference of their own but not be subject to any particular parliament. The Minister has also confirmed that there is no disallowance provision at all by the Federal Parliament of the Minister's direction in this matter. So this Federal Parliament is being asked to sub-contract an important matter relating to the regulation of a profession-the interference by the Commonwealth Government into the delivery role of the States. It delegates this responsibility to an extra-parliamentary group or meeting of Ministers, with no disallowance provision to govern the rules that are set down by the agreement between these Ministers. On these grounds, Mr Deputy Chairman, it is not possible for the Opposition to support this clause. Mr MacKELLAR(Warringah)(10.21) —I take up the point again about visiting medical specialists particularly in the non-teaching hospitals and in the country areas of Australia. Mr Cunningham —You would not know anything about it. Mr MacKELLAR —That is something coming from the honourable member. The DEPUTY CHAIRMAN(Mr Millar) —Order! The honourable member will disregard interjections. Mr MacKELLAR —The fact remains, Mr Deputy Chairman, that if this legislation is introduced there will be an extremely strong disincentive for private specialist radiologists and other specialist medicos to work and to provide services in non -teaching hospitals, particularly in country areas. It could be, and in fact it is likely if this legislation is enacted, that people will be very grossly disadvantaged in areas where their alternative sources of health care are very restricted. Dr BLEWETT(Bonython-Minister for Health)(10.22) —I will reply to the points that were raised. First of all, I take the so-called constitutional or parliamentary point. As both the honourable member for Warringah (Mr MacKellar) and the honourable member for Mackellar (Mr Carlton) know, in relation to hospitals a whole lot of arrangements and guidelines are reached between the States and the Commonwealth, which are not subjected to this Parliament because they are of the nature of arrangements between the State governments and the Commonwealth Government. In fact every time the former Government changed the hospital cost sharing agreements, there was a whole lot of arrangements which were never subject to this Parliament's approval. This is just another one of those arrangements in which the honourable member for Warringah and the honourable member for Mackellar were involved inevitably in the relationship between the Commonwealth Government and the State governments in hospital matters. Secondly, there has been widespread concern, about which both the honourable member for Mackellar and the honourable member for Warringah know, amongst all State health Ministers, and I believe it has also been shared by Commonwealth health Ministers, in regard to some problems relating to rights of private practice in public hospitals. In fact, the Jamison Commission of Inquiry into the Efficiency and Administration of Hospitals, when it reported on this issue, recommended that the rights of private practice for salaried specialists in hospitals be gradually wound down. The previous Government did not accept that recommendation, nor do we accept it. What we are trying to do here is primarily not to cut back specifically the income of doctors. If honourable members look at the details of our proposals, which are very closely in accord with many of the practices that already occur in the States, I do not think that they will find them particularly draconian in income terms. First, our proposals will ensure that at last we know the details of such private practice rights, for which we have no national figures at all. Secondly they will prevent those kinds of rights from becoming open-ended. That is the purpose of this arrangement with the States. I say on this matter that there is a considerable degree of co-operation between the States and the Commonwealth, all concerned with this problem. The reason why we have approached the diagnostic services first of all is partly because they can be relatively easily identified in relation to the schedule and because they have raised the greatest concern amongst Ministers and others who have been looking at this matter. Question put: That clause 18 be agreed to. The Committee divided. (The Deputy Chairman-Mr P. C. Millar) Ayes . . . . . . . . . . . 65 Noes . . . . . . . . . . . 40 —— Majority . . . . . . . . . 25 —— Baldwin, P. J. Jones, BarryBeddall, D. P. Keating, P. J.Bilney, G. N. Kelly, R. J.Blanchard, C. A. Kent, L.Blewett, N. Keogh L. J.Bowen, Lionel Kerin, J. C.Brown, John Klugman, R. E.Brown, Robert Lindsay, E. J.Brumby, J. M. McHugh, J.Campbell, G. McLeay, LeoCharles, D. E. Maher, M. J.Charlesworth, R. I. Mayer, H.Chynoweth R. L. Mildren, J. B.Cohen, B. Milton, P.Cross, M. D. Morris, AllanCunningham, B. T. (Teller) Morris, PeterDarling, E. E. Morrison, W. L.Duffy, M. J. Mountford, J. G.Edwards, Ronald O'Neil, L. R. T.Everingham, D. N. Punch, G. F.Fatin, W. F. Saunderson, J.Free, R. V. Scott, J. L.Fry, K. L. Simmons, D. W.Gayler, J. Snow, J. H.Gear, G. Staples, P. R.Griffiths, A. G. Steedman, A. P.Hand, G. L. Theophanous, A. C.Hayden, W. G. Uren, T.Hollis, C. Wells, D. McM.Howe, B. L. West, S. J.Humphreys, B. C. (Teller) Willis, R.Hurford, C. J. Young, M. J.Johnson, Les Aldred, K. J. Howard, J. W.Andrew, J. N. Katter, R. C.Anthony, J. D. Lloyd, B.Braithwaite, R. A. McGauran, P. J.Burr, M. A. McVeigh, D. T.Cadman, A. G. MacKellar, M. J. R.Cameron, Ewen (Teller) Macphee, I. M.Cameron, Ian Moore, J. C.Carlton, J. J. Newman, K. E.Coleman, W. P. O'Keefe, F. L.Connolly, D. M. Porter, J. R.Dobie, J. D. M. Robinson, IanDrummond, P. H. Rocher, A. C.Edwards, Harry Ruddock, P. M.Fisher, P. S. Shipton, R. F.Groom, R. J. Sinclair, I. McC.Hall, Steele Spender, J. M.Hawker, D. P. M. Street, A. A.Hicks, N. J. (Teller) White, P. N. D.Hodgman, W. M. Wilson, I. B. C. Reeves, J. E. Fife, W. C.Dawkins, J. S. Lusher, S. A.Jacobi, R. Cowan, D. B.Child, J. Goodluck, B. J.Beazley, K. C. Tuckey, C. W. Question so resolved in the affirmative. Clauses 19 to 23-by leave-taken together, and agreed to. Clauses 24 to 27-by leave-taken together. Mr CARLTON(Mackellar)(10.33) —Mr Deputy Chairman, our concern about these clauses of the Health Legislation Amendment Bill is that they relate to the bulk billing provisions of Medicare. Also, one of the clauses relates to the sacking of the private health insurance funds as the agencies for handling pensioner payments when doctors do not bulk bill and when pensioners are required to recover 85 per cent of the schedule fee through a private insurance fund acting as an agent of the Government. We indicate to the House our very grave concern at the step being taken by the Government in moving away from the concept of a patient contribution to each service. The fundamental point is that patients ought to be expected to make contributions, if they are able, to medical services. We also indicate our displeasure at the Government's action in sacking the private health insurance funds from yet another of their current functions. Underlying these three clauses are principles which we regard as of fundamental importance. In the earlier part of the debate on other clauses-it also relates to these clauses-certain members of the Opposition expressed views about the medical profession and its propensity to indulge in actions which, if not illegal, are at least against the public interest. I refer to the possibility of overservicing. It should be understood that when I became the Minister for Health a Joint Committee of Public Accounts inquiry was in progress and there was a very substantial amount of public criticism about the medical profession. That criticism was led by the Australian Labor Party and it was very much supported by the Press because bad news is good news for the Press. I do not blame the Press for that but I blame certain members of the Australian Labor Party, including its former parliamentary leader, who made a very vigorous attack on the medical profession in a speech in Melbourne, and I blame certain people outside the Parliament who supported the Labor Party in this action. I refer specifically to the Doctors Reform Society, whose former President, Dr Andrew Refshauge, has now been selected as the left wing Labor candidate for the State seat of Marrickville in New South Wales, and to certain academics who made the same kinds of statements. I took the view that these attacks on the medical profession were utterly unwarranted in respect of 99 per cent of it. I took the view that it was important to support the good members of the profession against such attacks. I took the view that it was important to point out that the parliamentary Public Accounts Committee, under the chairmanship of my colleague the honourable member for Bradfield (Mr Connolly), was taking a middle of the road course to examine the facts but not to carry out a witch hunt of the medical profession. Time and again I spoke in support of what I called the good doctor. My support of the good doctor was certainly upheld by the public in an opinion poll published by the Bulletin during that inquiry which indicated that the esteem of the medical profession still ranked at the very top. Let it be perfectly clear that members of the Opposition have very firmly, both in government and now, supported the good doctor. We are interested in excellence, professionalism, good medicine and good health care. We do not blind ourselves to the possibility that some members of the profession might be tempted to go over the mark and provide unnecessary services and that some may well indulge in fraud for which they should be prosecuted. Let us make quite clear what we are against in this matter. We are against moving the boundary so that more honourable members of the profession, might be tempted into error. In Canada, for example, most patients never see an account. The doctors send the bills directly to the Government, and the only surveillance of their activities is through an overall computer profiling system. We do not believe that that is satisfactory. We believe that more and more people will be tempted to pass across a boundary which will become increasingly blurred in respect of what is an acceptable service. We believe that once we take away the constraint caused by patient contribution, we will be on perilous ground. We acknowledge that we are already on perilous ground with regard to pensioners and the disadvantaged. We accepted in the past that difficulty because we saw no other way of giving taxpayer contributions to the needy. But to accept that for 80 per cent of the population where it does not occur at the moment we regard as being absolutely unnecessary. It also places this profession in dire peril. We believe that these measures-they are certainly embodied in these clauses of the Bill- will put the medical profession in an even closer, more direct relationship with the Government. If the present Minister for Health (Dr Blewett) achieves his objective of having all medical services paid direct from the Government at 85 per cent of the schedule fee, how can he possibly say that the medical profession is not bound hand and foot to the Government? Any professions at the moment that this is only a modest measure are not really acceptable from the present Minister. Over some considerable period he has indicated in speeches that he has made that he believes that private practice, with a fee for service, is a basically unacceptable way for the medical profession to operate. In fact the Minister indicated this in a speech to a meeting of the Australian Hospital Association in Adelaide last year at which I was present. He acknowledged that the general feeling of the Australian community was such at this moment that the Australian Labor Party felt constrained in this matter. It felt it could not go directly to such a system. But he made absolutely clear his personal direction in this matter. Certainly he made it clear to me at that time that any measures he brought in-he has persuaded this Government to bring in this measure-would be stages along the way towards closer control of the medical profession. Anybody in the profession who does not read the Das Kapital or Mein Kampf of this Minister-the things he said earlier-and who does not realise what they might be in for as a result of the clauses in this Bill is living in cloud-cuckoo-land. Fundamentally therefore, we are opposed to these clauses because they embody this movement towards bulk billing and this movement away from the private health insurance sector. These clauses require that that sector will no longer be able to process the claims of pensioners who were not on the bulk billing system. For that reason the Opposition opposes these clauses. Mr NEWMAN(Bass)(10.43) —I would like to reinforce what was said by my colleague the honourable member for Mackellar (Mr Carlton) on this issue. Mr Cunningham —You would not know anything about it. Mr NEWMAN —For heaven's sake, if the honourable member for McMillan cannot make a contribution he should leave the place. Let us have some rational discussion. That is what the Minister for Health (Dr Blewett) has been asking for. I reinforce what was said on this issue by my colleague the honourable member for Mackellar. Many members of the Government have asked how they might help to prevent overservicing if this is encouraged by the existing system. One clear way of doing this is to make sure that there is a contribution from the patient. In that way there is a natural curb on the patient's willingness to go to the doctor time and again. Mr Groom —That is pretty obvious. Mr NEWMAN —As my colleague the honourable member for Braddon has said, that is a very obvious proposition. But of course these clauses remove that completely from the scheme. I would like also to add to what the honourable member for Mackellar said about overservicing. Perhaps I can take it from another point of view. Whilst I think the honourable member for Mackellar said that 80 per cent of the population would now be looking for bulk billing, let us look at this question from a doctor's point of view. I do not think we will have a problem with those doctors who presently bulk bill. I think the advisers of the Minister for Health who are seated behind him in the chamber will agree that these practices that now have large, bulk billing procedures-say 70 per cent-have a very good relationship with the departments in the various States. They are providing a service to those large numbers of people whom they bulk bill. There probably is no question, either in their dealings with their patients or with the Department of Health, that they are trying to overservice. The problem really is this: We believe that the pressures that the Government is putting on other doctors to bulk bill will mean that they will be looking to make up lost income. This could involve up to 15 per cent of lost income. Those are the doctors who will be tempted to overservice as a result of this new procedure. Again I ask the Minister whether he can give us some indication of what he will do about that. He said that, in a month or two, he will be telling us what he will do about the surveillance of the profession and that that will cope with overservicing. He said that the Government will probably take up some of the recommendations of the Joint Committee of Public Accounts. But it would be reassuring if tonight the Minister could tell us how he will cope with this problem. Perhaps I could just put in a nutshell the problem about which we are concerned . We are not worried about those people who presently bulk bill. We are worried about the number of doctors who will be forced to bulk bill in the future. Because they have lost income they will be tempted to overservice. I have previously described the way in which they can easily do this. I ask the Minister please to let us know how he will cope with that very real problem of overservicing so that the cost to the Government will not overreach the Budget that he has placed on the scheme. Mr CONNOLLY(Bradfield)(10.46) —the bulk billing provisions and the related matters concerning persons who are entitled to Medicare benefits covered in clause 24 and the subsequent clauses really are the very heart of the doctrinal reforms contained in this legislation. I find some difficulty in understanding how a government, which was elected, among other things, to restore employment to the Australian people-a government which promised, as I recall it, to create some 300,000 jobs, in its first term-can enter into an arrangement which it knows will cost the jobs of anything up to 5,000 people who are currently the employees of the health funds which, under this Act and, in accordance with these provisions, are excluded from being able to act as agents for Medicare, in relation to pensioners in particular. In other words, those health funds and their personnel will be limited to that section of the population. I have not heard the Minister for Health quantify those people who will be able to continue to finance their medical health coverage in addition to their contributions to Medicare. On the other side of the equation we are told that the Governemnt proposes to employ an additional 2,500 people to cope with the Medicare arrangements. However, there is a simple time problem here. I gather that those are to be employed before December. It is quite likely that most people will lose their jobs in the funds in 1984. Therefore very few, if any, of those people will be able to transfer from the health funds to Medicare. The point made by my colleagues is also very valid. We are concerned about oversevicing. We do not believe that a relationship should exist between the doctor and patient which does not involve at least some element of a fiduciary relationship by which the patient is encouraged to consider whether the additional requirements for medical care and attention are needed rather than leave that decision exclusively to doctors, some of whom-as we have seen in relation to Medibank mark 1 in particular-felt themselves to be in a situation where they would literally delve into the mythical Pandora's box. I agree absolutely with the observation made by the honourable member for Mackellar (Mr Carlton)-that the vast majority of doctors are honourable people who do not actively enter into either overservicing or fraud. This point was emphasised quite clearly in the report of the Joint Parliamentary Committee of Public Accounts into medifraud and overservicing of which I was chairman. Nevertheless, the empirical evidence would suggest, and I think commonsense would support, that if we are not to have a system which encourages some sense of financial restraint while at the same time ensuring that all the people in the community who are in financial distress, for whatever reason, are totally covered by a government-funded scheme, as they have been to date, the remainder of the population who are abe, to some degree at least, to finance their costs and to take out insurance should be expected to do so. The essential problem we have with this proposal is that, once again, we see this doctrinal tendency to remove from individuals any sense of basic responsibility for the manner in which they conduct their lives and the relationships which they wish to develop with their doctors and the medical profession for their health care. Mr MacKELLAR(Warringah)(10.50) —In relation to the clauses which we are debating at present, I would like to reinforce the remarks of the previous speakers who have outlined particularly clearly the fact that a very disreputable campaign was waged last year, spearheaded by the Australian Labor Party in particular and its mouthpieces in the medical profession, the Doctors Reform Society, which has shown its true colours at last by the selection of Dr Andrew Refshauge as a left wing Labor Party candidate in New South Wales. The fact of the matter remains, as other honourable members have pointed out, that the great majority of the members in the medical profession are honourable people. There is the problem of fraud and overservicing and nobody runs away from this problem, but they are very different problems. Fraud is something which can be proved in a court of law and should be proved in a court of law. If doctors are guilty of fraud, the full weight of the law should be visited upon them. But overservicing is a very different kettle of fish indeed. What is overservicing for one person may not be overservicing for another person. One of the tremendous difficulties that bureaucrats and politicians have in relation to medical services not being the provider and the professionals supplying those services is to make decisions as to what is appropriate treatment and what is not appropriate treatment. The only arbiters as to what is appropriate treatment , the frequency of treatment, and the extent of treatment, must be the profession itself. When we have intervention of bureaucrats and politicians into this professional relationship between a doctor and his patient, then we are heading for very serious trouble indeed. We are seeing in these clauses the move towards the cruel deception that somehow we have a free health service because we are removing from the minds of the populace in general the fact that they have to pay something for health services. They go along to the doctor and he agrees to bulk bill, so no moiety is involved. There is no financial or fiduciary arrangement between the doctor and his patient. This removes restraint on both sides of that arrangement. It removes restraint on the doctor and it removes restraint on the patient. What we have is the building up in the population of a view that here we have somehow a so-called free system. It does not cost them anything. With the removal of these restraints, which are very real restraints, we have a very great incentive for overservicing. Then we have the difficulty of defining what is overservicing. In that difficulty of definition we will find a bigger and bigger bureaucracy being built up and more and more intrusion into the affairs and the relationships between doctors and their patients and an inevitable breakdown in that special relationship which I believe is so important between a doctor and his patient. I believe, as the honourable member for Bradfield (Mr Connolly) has described, that this doctrinal obsession by the Labor Party with this particular arrangement can, in the long term, only serve to weaken that very special relationship between a doctor and his patient and remove very proper restraints on both the doctor and the patient in terms of the number of services, the variety of services and the amount of servicing which should be carried out in relation to any particular patient. Mr NEWMAN(Bass)(10.54) —I would like to add to what my colleague the honourable member the Warringah (Mr MacKellar) has just said about the relationship between doctors. In the course of checking on the effect of this scheme on general practitioners in my own electorate, one of the things that has come through very clearly to me is that many genuine doctors-not ones that were rubbished before by the Government when this particular point was made in the general debate-are very concerned about what will happen in the relationship between themselves, their staff and their patients. They are extremely worried about the administration that centralised bureaucracy will impose upon their practice. At present it takes eight weeks for a bulk bill payment to be made. It is worse if a small mistake is made on the documents that are required because then it can take six months to resolve. That means that the doctor's staff is very much concerned with the paper work and the administration and they spend a great deal of time ensuring it is accurate and meeting the other requirements of the Department. The Minister for Health (Dr Blewett), when this was mentioned briefly, did give an assurance that the concern was not warranted. But I would like him to spell out in more detail why it is not warranted. Just to summarise, the point is that the staff which one would expect to help patients coming to a surgery do not have the time to do so as they are preoccupied with the administration of the system. That means that the relationship usually between staff and patients is lost. Could the Minister explain that matter to me? Dr BLEWETT(Bonython-Minister for Health)(10.56) —I have argued at length that the fears of the impact of this measure on doctors' freedom, the fears of the impact of this measure on doctors' incomes and the fears of the impact of this measure on overservicing are grossly exaggerated. But just let me try briefly to deal with a couple of specific points raised on this occasion without going over this whole dreary debate again. I must say that there is illogic in much of what the Opposition is arguing. If it claims that the problem with bulk billing is that it removes the moiety, why does it not strongly argue against gap insurance which equally removes the moiety? It is true that in some ways bulk billing removes the moiety for the poorer sections of the population and removing gap insurance removes the moiety for the better off section of the population, but if there is a problem that arises from people not paying a moiety, that is as true of those who have got gap insurance and are charged the schedule fee as it is of people who are directly billed. I really think that if we look at this overservicing problem we will agree that it is a problem of insurance. I do not think there is much evidence to suggest that this change in direct billing, accompanied as it is by cutting back on gap insurance, will increase that overservicing problem. If honourable members look at clause 57 of the Bill, they will see that we have taken up the specific recommendations made by the Joint Committee of Public Accounts in relation to better administrative ways of dealing with direct billing in order to protect against fraud and overservicing. Those recommendations of the Public Accounts Committee are taken account of in clause 57 of the Bill. In relation to the point raised by the honourable member for Bass (Mr Newman) the problem at present, which explains the very great delays, is that we have got a very complicated system. Each direct billing claim has to be checked to see whether the person who has been direct billed is entitled to that direct bill and the person has to fall into one of those protected categories. Then the numbers have to be identified in relation to pension cards and health care cards . In addition, before this Government rightly fell from office it added to the complications by increasing the social security number by two and adding further checks that had to be carried out. So we are now faced with a bureaucratic maze of cross-checking between the number on the assignment voucher and the entitlement records of the Department of Social Security. This is the major reason for the current-I agree with the honourable member for Bass-quite unacceptable delay in doctors receiving payment for the direct billing claims. Indeed, the introduction of these checks by the previous Government earlier in the year has increased the number of claims being rejected from 5.5 per cent to 14 per cent and therefore increased the number of claims requiring double checking and double handling by over 150 per cent. Under Medicare, because all that type of checking is not required, the doctor will be free to direct bill any patient, and then all of that bureaucratic maze can be avoided, plus the fact that we will be using a much superior computer system through the Health Insurance Commission than the somewhat obsolete system that we have now. I must also point out that another problem that the previous Government bequeathed us was that bulk billing has been increasing because the dole queues have been increasing. The previous Government had made no effort to provide extra staff to handle the increased number of direct billing problems arising as a result of increases in unemployment and, therefore, increases in the number of people entitled to direct billing. We have taken action in that field by increasing temporarily by over 111 the staff dealing with these problems to try to speed up that quite unacceptable delay. I am very confident that under Medicare, because of all of those checks being removed, that will not be a problem. The employment issue was dragged into the debate on this clause. The Deputy Chairman did not object, so I will briefly respond to it. The figure for the potential problem of unemployment in private insurance funds has always been grossly exaggerated. It is not sustainable by any examination of employment in the private funds. These figures have been regularly peddled without any examination, so they are exaggerated figures to start with. Mr MacKellar —How? Detail how they are exaggerated. Dr BLEWETT —If the honourable member looks at total employment in the private insurance industry, he will see that the potential threat is to some 4,000 jobs. Let me talk about those 4,000 jobs. There are some 2,500 positions in the Health Insurance Commission. Some of those are part time, so the total number of jobs would be about 2,800. There is a significant element of part time employment in the health insurance industry. In addition, the honourable member for Bradfield (Mr Connolly) raised the matter of the non-coincidence of the employment pattern ; that we would be taking on employees in the Health Insurance Commission in October-November and the private funds would still require all of their staff until February-March. That has been coped with by providing that, apart from private health fund employees, employees taken on in this early period would be temporary employees. So private fund people would be able to stay on with their fund while they were being used and then transfer to the Health Insurance Commission. Indeed, the efforts we have made to cope with the problems we recognise compares more than favourably with the way the Health Insurance Commission was required to run down its staff in the previous period. If the private health insurance funds are genuinely non-profit organisations, with the protections we have given them in relation to administrative costs, they should be able to cope with perhaps slightly surplus employment for a relatively short period, again given the turnover that takes place in the private health insurance industry. The DEPUTY CHAIRMAN(Mr Millar) —I call the honourable member for Bass. Mr NEWMAN(Bass)(11.03) —Mr Deputy Chairman-- The DEPUTY CHAIRMAN —I believe the honourable member for Bass has spoken twice to this question. Mr NEWMAN —No, only once. The DEPUTY CHAIRMAN —I beg his pardon. I call the honourable member for Bass. Mr NEWMAN —I should like to take up the last remarks of the Minister for Health about the problem of employment in the health insurance funds. The DEPUTY CHAIRMAN —Order! The honourable gentleman was mistaken. He has addressed the question twice. He is not able to continue. Mr MacKELLAR(Warringah)(11.04) —I want to take up the point on which the Minister for Health keeps insisting both inside and outside the House, that is, that we are illogical by saying that we should not have bulk billing but we should have gap insurance. What he conveniently failed to mention at any stage in his rejection of this proposition is that even with the gap insurance the patient gets a bill from the doctor. Therefore, there is a real appreciation by both the medico and his or her patient of the costs involved in health services. In this debate about the costs of health services we must bring home to the practitioners and the recipients the ever-escalating costs of providing high quality health care. When I receive a bill-I do not know whether the Minister is different-whether or not I am insured, I study it very carefully. If there are aspects of the bill which do not accord with my recollection of events, I take action about it. The doctors who provide the bills must check that the services being charged for were actually provided. So there is a double check on both the provider and the recipient of the health services in relation to the services being provided, and there is also a much clearer understanding of the costs of the services being provided. If the Minister wishes to conceal from the public the true costs of providing health care services in this country, one of the best ways of doing it is to insist upon or direct people towards bulk billing. That will conceal the costs. The patients will not know how much it costs when they go to the doctor. As far as they are concerned, it does not cost them anything. So, for sure, they will not have an appreciation of the escalating costs of health care. The only time when they may have some understanding of this is when the results of the increased services come upon them annually, evidenced by the increased taxes they will have to pay to provide for those services. Mr SPENDER(North Sydney)(11.06) —I wish to say something about the question of employment in the industry. As matters presently stand, we have what has been recognised as a health insurance industry. The Minister for Health will no doubt be familiar with the background of the industry and how it has grown up. He will probably also be familiar with some litigation which has been going on for about 10 years in the health insurance industry involving, amongst others, the Federated Clerks Union and, as well, the Australian Insurance Employees Union. If the Minister has caused his Department to examine the matter, he will find-I speak from memory, not from any note that I have in front in me-that in Victoria and New South Wales, in particular in friendly societies and, of course, in registered health funds as well, a very large proportion of the employees are engaged in the business of what is called the medical insurance industry. I am sure the Minister will have had representations made to him by the AIEU and most certainly by the Federated Clerks Union concerning the consequences to employment in the health insurance industry as it is now comprised. Whilst in the health insurance industry, and in particular in the friendly societies, there are cases where dual functions are exercised, that is, where an employee exercises a function in relation to what is purely health insurance and also in relation to other matters which have traditionally been within the province of friendly societies, there is a fairly high amount of demarcation. One could say that a large proportion of employees are engaged simply in health insurance work as it is now set up. I therefore ask the Minister whether he can tell us what are the estimates that have been put to him, in particular by the Federated Clerks Union, as to loss of employment in the health insurance industry on the basis that the private funds are excluded in the manner in which this legislation would exclude them. These details will be known to the Minister. He will have information about the industry. Indeed, I have some passing aquaintance with it myself. I would be very glad if he could tell us what the Department has told him and what the Federated Clerks Union and the AIEU, if it has come to see him, have told him about loss of employment in the industry. Mr GROOM(Braddon)(11.09) —Since the honourable member for Bass (Mr Newman) has used up his opportunities to speak on this clause, he has raised with me an important issue which affects Tasmanians. I would like some answers from the Minister for Health. He said that employment within Tasmania would not be adversely affected. That is certainly not the advice that my colleague the honourable member for Bass and I have received from some funds in Tasmania. For example, we understand from MBF in Tasmania that there is likely to be a loss of some 100 jobs. There is an additional computer capacity which will not be able to be used because of the health insurance changes. That in itself will mean some loss of employment. As we understand it, there will not be a capacity within Medicare to employ those people who might lose their jobs. Another point is: What computer facilities will be used? Will they be based in another State, and not in Tasmania? Generally I would like some comments from the Minister as to how the employment factor will affect Tasmania. I also make the more general point that I think this is a sad day in many respects because we will now have increased control through the bureaucracy. This is an increasing tendency. Life is becoming much more complex and we have much more control by faceless officials within departments. What concerns me very much is what protection there is for the privacy of individuals. A year or so ago I raised with previous Ministers this problem of the privacy of patients. Government interference and control, which is obviously increased by this legislation, means increased government surveillance. Mr Holding —Oh! Mr GROOM —The Minister for Aboriginal Affairs, sitting behind the Minister for Health, says: 'Oh!'. He is not concerned about increased government surveillance . I will not get into the Combe affair and that sort of thing, but 1984 is almost here and we have Big Brother controlling us. The DEPUTY CHAIRMAN(Mr Millar) —Order! I think the honourable member is expanding his remarks beyond the point of relevance. Mr GROOM —I will try to get directly back to the point. My immediate point concerns protection of the privacy of individuals. One case drawn to my attention concerned someone investigating alleged fraud or overservicing by a medical practitioner. A patient received a knock at his door, and there stood an investigator. The investigator asked: 'Were you treated by a certain medical practitioner? Did he see you so many times? Were you treated by him so many times?' This becomes, I think, a very serious invasion of privacy. I hope that the Minister, who I know is a concerned person, will be concerned about this question of the privacy of patients. I would like to know what measures he has introduced to ensure that all the computer details are private and what steps are being taken to protect the privacy of the contract between a medical practitioner and his patient. There are very important issues and we would like answers tonight. Dr BLEWETT(Bonython-Minister for Health)(11.13) —I take up the question of security raised by the honourable member for Braddon (Mr Groom). The Health Insurance Commission, which will be running the medicare system, has an impeccable record for security, as good as any of the other funds, although I am not denying that they have a very good record of security. We are confident that that record will be maintained. Nevertheless, just as under the present system it is sometimes necessary to follow through an exploration of doctor fraud or overservicing, so it will be under the Medicare system. It is no different from the present situation in that at times, in order to examine problems in relation to medical fraud and overservicing, one has to examine a doctor's practice and behaviour. That is a problem in the present system and no doubt will be a problem of the coming system, but the Health Insurance Commission has an impeccable record in regard to the general security of the system. That was one of the reasons for making the decision, and that will be maintained. In relation to employment, I must say that Tasmania has done peculiarly well, I think better than any other State. The regional arrangements we have made, that is, the definition of regional funds, particularly benefit Tasmania. In addition , of course, the other private funds will benefit from the deregulation and diversification concessions which have been made. Also their employment is not as threatened as they once thought it was by the overcompetitive ability of Medibank Private because we have placed strict restrictions on the ability of Medibank Private to expand. I think that whole package of actions has gone a long way toward meeting and undermining many of the exaggerated fears about unemployment in the industry, particularly in Tasmania, which has benefited very much from the decisions in relation to regional funds. Question put: That the clauses be agreed to. The Committee divided. (The Deputy Chairman-Mr P. C. Millar) Ayes . . . . . . . . . . . 67 Noes . . . . . . . . . . . 41 —— Majority . . . . . . . . . 26 —— Baldwin, P. J. Jones, BarryBeddall, D. P. Keating, P. J.Bilney, G. N. Kelly, R. J.Blanchard, C. A. Kent, L.Blewett, N. Keogh, L. J.Bowen, Lionel Kerin, J. C.Brown, John Klugman, R. E.Brown, Robert Lindsay, E. J.Brumby, J. M. McHugh, J.Campbell, G. McLeay, LeoCharles, D. E. Maher, M. J.Charlesworth, R. I. Mayer, H.Chynoweth, R. L. Mildren, J. B.Cohen, B. Milton, P.Cross, M. D. Morris, AllanCunningham, B. T. (Teller) Morris, PeterDarling, E. E. Morrison, W. L.Duffy, M. J. Mountford, J. G.Edwards, Ronald O'Neil, L. R. T.Everingham, D. N. Punch, G. F.Fatin, W. F. Saunderson, J.Free, R. V. Scholes, G. G. D.Fry, K. L. Scott, J. L.Gayler, J. Simmons, D. W.Gear, G. Snow, J. H.Griffiths, A. G. Staples, P. R.Hand, G. L. Steedman, A. P.Hayden, W. G. Theophanous, A. C.Holding, A. C. Uren, T.Hollis, C. Wells, D. McM.Howe, B. L. West, S. J.Humphreys, B. C. (Teller) Willis, R.Hurford, C. J. Young, M. J.Johnson, Les Aldred, K. J. Hunt, R. J. D.Andrew, J. N. Katter, R. C.Anthony, J. D. Lloyd, B.Braithwaite, R. A. McGauran, P. J.Burr, M. A. MacKellar, M. J. R.Cadman, A. G. McVeigh, D. T.Cameron, Ewen (Teller) Macphee, I. M.Cameron, Ian Moore, J. C.Carlton, J. J. Newman, K. E.Coleman, W. P. O'Keefe, F. L.Connolly, D. M. Porter, J. R.Dobie, J. D. M. Robinson, IanDrummond, P. H. Rocher, A. C.Edwards, Harry Ruddock, P. M.Fisher, P. S. Shipton, R. F.Groom, R. J. Sinclair, I. McC.Hall, Steele Spender, J. M.Hawker, D. P. M. Street, A. A.Hicks, N. J. (Teller) White, P. N. D.Hodgman, W. M. Wilson, I. B. C.Howard, J. W. Reeves, J. E. Fife, W. C.Dawkins, J. S. Lusher, S. A.Jacobi, R. Cowan, D. B.Child, J. Goodluck, B. J.Beazley, K. C. Tuckey, C. W. Question so resolved in the affirmative. Clauses 28 to 30-by leave-taken together, and agreed to. Clauses 31 to 45-by leave-taken together. Mr FISHER(Mallee)(11.23) —Clauses 31 to 45 deal with the approval of private hospitals and their categorisation. I want to raise this categorisation factor tonight together with the very real concern of several thousand people in the electorate of Mallee and throughout Victoria who are serviced by the bush nursing hospital system. Medicare will, of course, have a disastrous effect on thousands of patients in my electorate and in other electorates throughout Victoria. Indeed, through all of rural Victoria we will see massive reductions in health care services. As the Minister for Health (Dr Blewett) knows, the Victorian Bush Nursing Association is a unique group. The Association was established to provide in rural areas of Victoria hospital and related services for the care and treatment of people in need of medical care. Currently there are 38 bush nursing hospitals in Victoria with a total bed capacity of 828. There are also 18 bush nursing centres. In my electorate of Mallee there are nine bush nursing hospitals and three bush nursing centres. These hospitals, which are unincorporated, are registered with the Health Commission of Victoria as private hospitals. The hospitals are administered by autonomous committees elected from the hospitals' members and the committee members act in an honorary capacity. The organisation of these hospitals is very similar to that of ordinary small public hospitals, with one major difference. While public hospitals have full time qualified administrators, this is not the case with the bush nursing system . Several hospitals have full time salaried managers or secretaries and some have part time salaried secretaries. Others have secretaries operating in a purely honorary capacity. Like Bush Nursing Association centres, the hospitals in the main are located in small and relatively remote areas. Being private hospitals, the principal source of income is in-patient fees. Contrary to popular belief, bush nursing hospitals are not subsidised by the State Government. With the introduction of Medicare, all these hospitals will face severe financial difficulties because few people will be able to afford them. Mr Leo McLeay —A point of order, Mr Deputy Chairman. I have been listening to what the honourable member has had to say. It does not sound all that relevant to the clauses before the Committee. The DEPUTY CHAIRMAN(Mr Rocher) —Clauses 31 to 45 deal with private hospitals. I have been listening carefully and, as far as I can see at the moment, the comments are relevant. Mr Leo McLeay —Mr Deputy Chairman-- The DEPUTY CHAIRMAN —Does the honourable member wish to take a further point of order? Mr Leo McLeay —Yes. With due respect, Mr Deputy Chairman, my understanding of bush nursing hospitals is that they are public hospitals. The DEPUTY CHAIRMAN —Order! There is no point of order. Mr Leo McLeay —It is a quite relevant point of order. The DEPUTY CHAIRMAN —Order! There is no point of order. I call the honourable member for Mallee. Mr McVeigh —Mr Deputy Chairman, I raise a very brief point of order. I wonder whether the member from the Government side who raised the point of order was confused about loans for housing over lunches. The DEPUTY CHAIRMAN —Order! There is no point of order. I call the honourable member for Mallee. Mr FISHER —Thank you, Mr Deputy Chairman. I will not comment on the quite ignorant point of order raised by the honourable member for Grayndler (Mr Leo McLeay). I ask the Minister for Health: If it was the intention of the Australian Labor Party, as it stated in its pre-election policy, that all Australians would be guaranteed automatic entitlement to medical services without any direct charge, why are bush nursing hospitals being categorised under the private hospitals system? Over one-third of private hospitals in Victoria are bush nursing hospitals and they play a major role in health care services in remote areas. Yet no one-not pensioners and not even the 1 per cent levy payers-will be able to use the facilities of the bush nursing system without cost. People wanting to use a bush nursing hospital will have to take out private health insurance to cover themselves. It will clearly disadvantage thousands of people living in rural areas where the only hospital is a bush nursing one. I ask the Minister: Does he expect these people to travel unnecessary miles-in many cases in my electorate, hundreds of miles-in order to receive hospital care that they can afford? How many lives is the Government prepared to put at risk with this carelessly constructed policy? Is this how the Labor Government intends to look after the sick and the elderly or is this simply another attack on people who live in rural areas? This repressive piece of legislation will put at risk the viability of several hospitals in Victoria, including several rural hospitals. I have spoken to two bush nursing hospitals today. The one at Birchip advises me that it will be losing $1,000 a week under these arrangements and the hospital at Nyah will lose some $2,500 a week. Clearly this cannot be tolerated. Not only are the hospitals threatened with closure but also cleaners, cooking staff, nurses and doctors will also certainly have to leave these country regions. The closure of local bush hospitals will put the medical staff out of work and force them to move elsewhere to look for work. It will also have a serious effect on the unskilled work force. In turn, this downturn in the number of people living in the towns and coming into the towns for medical care will affect small business. The most astonishing aspect of this legislation is that in the drafting of it little consideration was given to discussing the implications of Medicare arrangements, and the categorisation of hospitals such as those which belong to the Victorian Bush Nursing Association. As recently as 31 August the Department of Health was claiming that it had lost the submission sent by the Association to the Minister for his consideration. Despite the fact that the executives of the Association advised on several occasions that they were prepared to meet with the Minister, such a meeting, unfortunately, has not taken place. In fact, although the Department received considerable correspondence from the Association, it was asking what the group was as late as early August. What an admission from the Department of Health to a group which represents over 33 per cent of private hospitals in Victoria, which provides 900 hospital beds and which employs hundreds of staff-a group that, with the introduction of Medicare, will move from profitable, sound growth to possible extinction. I plead with the Minister to review this legislation carefully to ensure that this outstanding and efficient Victorian health care delivery service is protected. Under this legislation people served by and who must attend a bush nursing hospital will have to take out health insurance and will also be compelled to pay the tax levy. They will have absolutely no choice and will pay twice for the privilege. This is an act of gross discrimination. I thought tonight that members of the Australian Labor Party might be prepared to speak on this issue. As we are discussing the very serious issue of the categorisation of private hospitals, I wish to mention those in Victoria that will be affected. In my electorate of Mallee there are nine hospitals-the hospitals of Beulah, Birchip, Charlton, Hopetoun, Murrayville, Natimuk, Nyah, Rainbow and Sea Lake. In the electorate of my colleague the honourable member for Murray, Mr Lloyd, we have the hospitals of Murchison, Nagambie, Pyramid Hill and Tongala. In the electorate of the honourable member for Gippsland, Mr McGauran, we have the hospitals of Heyfield, Mirboo North and Toora. The electorate of my colleague the honourable member for Indi, Mr Ewan Cameron, has the hospitals of Chiltern, Euroa, Violet Town, Walwa and Yackandandah. The honourable member for Wannon, Mr Hawker, has in his electorate the Merino hospital. The honourable member for Corangamite, Mr Street, has Cobden hospital. The honourable member for Bendigo, Mr Brumby has Wedderburn hospital. The honourable member for Isaacs, Mr Charles, has the Chelsea hospital. The honourable member for Flinders, Mr Chynoweth, has the hospitals of Hastings and Mornington, and the honourable member for McMillan , Mr Cunningham, has the hospitals of Neerim, Pakenham, Upper Yarra and Cowes. The Minister for Communications, Mr Duffy, has in his electorate the Berwick hospital. The honourable member for Ballarat, Mr Mildren, has the hospitals of Avoca, Ballan and Trentham. The honourable member for Casey, Mr Steedman, has the Lilydale hospital and the honourable member for Burke, Dr Theophanous, has the hospitals of Gisborne and Lancefield. I mention these hospitals to indicate the very real and serious problem that will be faced in Victoria if these hospitals are forced to close or in any way to reduce their services as a result of the decisions being taken. There is an option. The recommendation is that an additional daily bed subsidy be paid to bush nursing hospitals for each in-patient day for eligible pensioners and persons designated by the Department of Social Security as disadvantaged; and that such a subsidy be not less than the average daily bed cost as reported annually by hospitals to the Victorian Bush Nursing Association, less the standard daily bed subsidy of $30 per day payable to private hospitals, and not more than an approved charge for treatment for a private patient in shared accommodation in a public hospital, which is $80 per day. I ask the Minister to look urgently at this problem in the interests of the secure and safe delivery of medical services in the country areas of Victoria. Mr CUNNINGHAM(McMillan)(11.34) —Although such an important piece of legislation is before the Committee, I for one do not feel that it is the duty of every member of Parliament to spend a lot of time on his or her feet tonight. If that were the case we would be here until 8 o'clock tomorrow morning. However, the honourable member for Mallee (Mr Fisher) has listed all the bush nursing hospitals in Victoria and has sought to make a case against members of the Australian Labor Party to the effect that they are not doing anything on their behalf. Let me put a few facts before the Committee. I do not intend to speak for the Minister for Health because I am sure he is well aware of what is going on and is quite capable of summing up at the end of this stage of the debate. Let us take a few of the points made by the honourable member for Mallee. The Victorian Bush Nursing Association sought to contact the Government first on 7 June 1983. In case anyone thinks we are not interested, I have here the complete file of what is going on. Mr McGauran —What have you done? Mr CUNNINGHAM —If honourable members will just wait I will be able to tell you and the Minister for Health (Dr Blewett) will be able to explain just what is going on. The Bush Nursing Association is unique in Australia. it exists only in Victoria. Here we are dealing with a national Medicare scheme which is designed to assist all Australians. The scheme is designed to assist those people whom the previous Government ignored for seven years when it had the opportunity to do something about its promise to maintain Medibank. Let me take just a few moments to explain to the Committee just what the situation has been. My first contact with the Victorian Bush Nursing Association in regard to any problems in relation to this issue was on my initiative, last Wednesday, when I contacted the Executive Director of the Association and asked him what was the situation. Mr McGauran —It was a bit late. Mr CUNNINGHAM —My contact with the four hospitals in my area has indicated clearly that they were not aware that there were any problems at that stage. They were still quite content. If honourable members opposite would just listen for a while, they might learn something. Let me just explain it to them. Seven members on the Government side have bush nursing hospitals in their electorates. Not one of those seven members was privileged by the Executive Director of the Victorian Bush Nursing Association of any contact whatever. Not one piece of correspondence did we receive. Mr Porter —You should have contacted them. Mr CUNNINGHAM —Let us just put it into perspective. We on our side then made approaches to the Bush Nursing Association- Mr McGauran —Last Wednesday? Mr CUNNINGHAM —Last Wednesday after it had issued a Press release which was the first information we had that it was concerned with any problems with the Medicare situation. The Bush Nursing Association did not make any great moves towards the Government. In fact, even since the announcement by the Medicare organisation, bush nursing hospitals in our electorates have not been racing to us giving us information that they thought the problems that honourable members opposite are telling us about were there. The honourable members of the Opposition side are trying to tell us that we have ignored the bush nursing hospitals in Victoria. Mr McGauran —You are telling us. Mr CUNNINGHAM —What I am telling honourable members is that we have had contact with local hospitals. They have been well aware of the situation with Medicare- Mr Shipton —That you are wiping them out. Mr CUNNINGHAM —We have no intention of wiping them out. In fact their submission to the Minister clearly indicates that they are in support of Medicare, which is not what the honourable member for Mallee had to say. They are very keen to see that they co-operate with Medicare. They are not in a situation of animosity to the Government. Those hospitals realise that seven years ago when Medibank was first instituted they were on a good wicket and that local country hospitals have never received a better deal. The hospitals also believe that the promise made by the former Prime Minister that he would maintain Medibank was something that would be adhered to when he went to the election. They are very keen to see that this Government reinstitutes the philosphy of the Medicare situation. These 38 hospitals have always had difficulty dealing with their local people simply because the private hospital system dealt only with a small group of people who could afford to pay the insurance. The committees of the bush nursing hospitals always had pangs of conscience that there were people in their community that they could not serve, that there were people within the community who, for seven years, the Liberal Government ignored. I have had discussions with the Minister in the last week which I have relayed back to the bush nursing hospital in my area, and they are absolutely rapt in the situation. Opposition members interjecting- Mr CUNNINGHAM —Honourable members will find out when they talk to people in the bush nursing hospitals what the situation is. They will have a system, under the categorised system, which will suit their hospitals. In the future, they can look forward to discussions in which maybe the bush nursing hospitals system in Victoria will be able to provide a service to all of the people in their districts, all of those who contribute to their raffles, and all those dedicated people who work hard to raise money for those hospitals. They will not have to turn them away in the future simply because they do not have the money to pay private health insurance premiums. Medicare will subsidise private health insurance until the situation develops where negotiations can take place and where the views of the people in those areas, in which they want to have a shared ward, will be heard and that will be possible. We look forward to that day. The Opposition's policies over the last seven years did nothing for bush nursing hospitals. Opposition members know that. This legislation is the first step towards improving hospital care for all Australians, which is something that they never considered. Mr RUDDOCK(Dundas)(11.41) —In this discussion of clauses 31 to 45, I want to raise a number of very specific questions which I hope the Minister for Health ( Dr Blewett) will be able to address. I hope that he will be able to allay my concern and that of people in my electorate who are associated with particular private hospitals. In the scheme outlined by the Minister for clauses 31 to 45, I note that private hospitals are to be categorised and that the daily insurance benefit and Commonwealth bed subsidy will vary according to the categorisation. The Minister has indicated the wide variety of hospitals. There are major surgical hospitals and religious and charitable organisations run hospitals providing care and services comparable with the major public hospitals, and he has mentioned others at the extreme. Presumably those major surgical hospitals will be category A, and those that are categorised as bush nursing and other small hospitals in rural areas with few beds of the character of a nursing home, will be categorised as classification C. The Minister gave the details which the Bill does not provide, because clause 9 really empowers the Minister to specify the categories of private hospitals for the purposes of the Act and the daily amount of bed payment and to provide for consultation with State Ministers in relation to categorising those hospitals. Later, of course, in clause 44, there are certain provisions that provide access to premises for the purpose of inspecting books and presumably examining the premises and the like for the purpose of assessing hospitals. Later, in clause 45, there is provision for review of decisions that the Minister might take, and particularly the basis on which he categorises hospitals against certain principles, which he will be enunciating later, in certain regulations. I note that the appeals that can be taken are in relation to approval of premises as private hospital, the conditions of approval of premises as a private hospital, the revocation of approval of premises as a private hospital, the characterisation of particular private hospitals and the conditions attached to approval. The Minister has indicated, in his three tier structure, that category A hospitals will receive a $120 a day basic benefit and the $40 a day Commonwealth bed subsidy, making a total of $160; that category B hospitals will receive $100 a day benefit and $30 a day subsidy totalling $130; and that category C hospitals will receive $80 a day benefit and a $20 bed subsidy, making $100 a day. He makes that point and of course, at this stage, organisations are worried about the category into which they are likely to be placed. I want to develop one other matter before proceeding specifically to the subject of the hospitals about which I am concerned. The Minister made the point that the categorisation that he envisages is necessary because the steep increases that have occurred in public hospital charges over the past two years have allowed some private hospitals to increase their fees in line with those increases in public hospital charges. The Minister ascribes that as a reason for his belief that that has happened. Implicit in his remarks is a suggestion that private hospitals are charging excessive fees and, presumably, as a result of this categorisation, he will be able to bring those fees down significantly and reduce the income of private hospitals. Obviously that would be of very considerable concern to the religious institutions that are involved and to the private businesses that in some cases are involved and particularly if the organisations have not been run on a profitable basis or if the profit is unreasonably low. I note that provision is made for assessment and for officers of the Department to be able to undertake certain reviews. I know that the Minister has received the same brief that I have in relation to a particular hospital in my electorate. I refer to the religious hospital run by the Sisters of the Little Company of Mary-the Mount St Margaret Hospital. This is an approved hospital under the New South Wales Mental Health Act of 1958; it holds a licence for 170 beds; it is a third schedule charitable and religious institution without government subsidy; and it has never received either directly or indirectly government funds for its capital projects. The hospital admits voluntary and involuntary psychiatric patients under the fifth schedule of the hospital system in New South Wales. There are seven specialised areas in the hospital which cater for varying treatments including acute, suicidal anxiety neurosis, psychosis, extremely disturbed patients and psycho-geriatric units including Alzheimer's syndrome and Korsakoff's disease, in various stages. I have particular knowledge of the unit dealing with senile dementia patients. I have been a member of a board of a hospital that has looked for some time at the way in which it might extend its program to provide for those who are suffering from senile dementia. The Mount St Margaret's unit for catering for psycho- geriatric patients is unique. It is one of the leading facilities that are examined by many others that are interested in this work. The sisters have pursued a very worthwhile initiative. The hospital fees are set on the basis of providing sufficient income to cover operating costs and an ongoing program for updating indoor and outdoor facilities for the treatment of patients. The hospital has certainly very excellent facilities. It has a very excellent program for the training of psychiatric nurses. In fact, it is one of the only private hospitals of which I am aware that has a nurses' training school. It has been involved in this work for something of the order of 50 years. It also has a social work department and a pharmacy department serviced by appropriately qualified staff. It had an extensive occupational and diversional therapy program designed for the daily rehabilitation of patients. The hospital also hopes to be shortly accredited under the hospital standards for accreditation. It has recently involved itself in very considerable capital work in updating some of its facilities to ensure that they are able to be fire rated and to ensure that the premises, in a way in which many public hospitals in New South Wales are not, will meet final inspection and approval from the Board of Fire Commissioners of New South Wales. This is an outstanding hospital, yet I am told that it has never been inspected for the purposes of categorisation. All psychiatric hospitals have been categorised in category C and this has caused very considerable concern to the sisters. If, as I see from the smiles on the officers' faces and perhaps the Minister's face, a different system is to operate, hopefully I and other members could be informed. When I last saw the sisters several weeks ago they had not received any news in relation to this. There had been no inspection. Of course they had invited the Minister to visit the hospital. I think this is a very firm case, amongst others, for clear categorisation which takes into account the special nature of this hospital and the service it has given. I understand that the hospital fees will be reduced under the program from something of the order, at the moment, of $140 a day for private patients or $ 120 a day for those in shared ward accommodation, to $100 a day. That involves a very considerable loss to the sisters, who have not been running a profit-making enterprise. This hospital is a very important matter. No doubt others that might be assessed provide very specialised services, services way above those provided in what were described by the Minister as simple bush hospitals somewhat akin to nursing homes. Those factors need to be taken into account. I know there is provision for appeal, and I have mentioned that, but I think it is very important that those who are worried about this categorisation have their anxiety cleared up as quickly as possible. I think it is very unfair that people have been left in this situation where it has been suggested that all psychiatric hospitals will simply be lumped into category C. Dr EVERINGHAM(Capricornia)(11.52) —Mr Deputy Chairman, this vexed question of whether- (Quorum formed). The DEPUTY CHAIRMAN(Mr Rocher) —Order! Before I call the honourable member for Capricornia I remind honourable members-I particularly address my remark to the honourable member for Lowe-that when a quorum is being counted they should remain in their seats. Mr Humphreys —Mr Deputy Chairman, I raise a point of order. If you are going to insist on Government members adhering to the forms of the House you should make sure that the honourable member for Denison does not walk out of the House. He walked in and walked out. The DEPUTY CHAIRMAN —The honourable member is quite right. It did happen, but I did not notice it. Dr EVERINGHAM —We have heard some very exaggerated and hysterical predictions that bush nursing hospitals will close when they have not even been categorised yet. The honourable member for Dundas (Mr Ruddock) has used a little more balanced and moderate language and has recognised that there is provision for assesment of special cases and of all hospitals. He has recognised that there are mechanisms for appeal. If the bush nursing hospitals have to work at a loss as a result of the categorisation that is initially put on them, they have from now until 1 February to put their case. They have already done so. The honourable member for McMillan (Mr Cunningham) has told us that he took the trouble to contact them when they put out a Press release. Not one member of the Opposition who has made hysterical noises has apparently bothered to contact them. On the matter of the special case of the Mount St Margaret Hospital, the honourable member for Dundas has suggested that it is under the impression that all mental hospitals will be in category C. State governments have tried very hard to get all mental hospitals included in the same sort of funding arrangements as general hospitals. Federal governments of both colours have stoutly resisted this and said that it is a matter for the States. If the States are not prepared to meet the needs of those specialised hospitals, as the honourable member for Dundas calls them, which are in the private sector but which are providing servies that would otherwise have to be provided by State mental hospitals, the Federal Government is asked to pick up the bill. If it is already funding in the Mount St Margaret Hospital at Ryde under Medicare provisions, that hospital also will have the right of assessment and the right of appeal to determine in which category it falls. Under the present system a number of hospitals now get $136 a day. When they are sorted into these three categories, as the honourable member for Dundas has told us, they will receive either $100, $130 or $160, depending on their costs, their structure and the services they provide. Obviously, some private hospitals are having a marvellous time, making quite large profits from their $136 a day when really they could make do with the $100 which would meet their costs. Many of those hospitals have patients who are virtually nursing home cases or who come very close to it. The previous Government saw fit to make a distinction between acute care patients in what most of us would call bush hospitals- certainly small country hospitals-where there are no nursing home facilities as such but where nursing home type patients are accommodated in the small local hospitals. The previous Government decreed that certain of those patients should be treated as nursing home patients. The hospitals do not get the bed day subsidy that would apply to a hospital patient. They have to meet some of the costs of accommodation. They may get half of the Federal subsidy and State subsidy that other hospitals are getting. It is not a question of saying that bush hospitals will be closed. I am sure that the Minister for Health (Dr Blewett) will be just as sympathetic and just as easy to approach as was the honourable member for McMillan. Maybe the hospitals have not had an interview with the Minister as yet. They have until 1 February to make their representations. There is a mechanism in the Bill for assessment. There is a mechanism for appeal. No responsible government would close public hospitals when they are providing an essential service. A Labor Government would be the last to do that sort of thing. When we were in office in the Whitlam years we did more for the hospital system than the Liberals did in all their years in power after World War II. Not only did we give them Medibank funding to an extent which they had never had before, by way of maintenance provisions and maintenance costs, but also we provided a hospital construction program which for the first time gave them capital funds to upgrade their standard of buildings in hospitals and nursing homes. That was done on the basis of consensus with State governments of both colours. Joint hospital works councils were set up in every State with equal numbers of State and Federal representatives, bureaucrats, who looked through the States' priorities and determined, in a co-operative way, in a consensus way, what ought to be priorities for hospital construction. Almost half of that money which has transformed the shortage of hospitals and hospital facilities and has upgraded and modernised hospital accommodation in every State including my own, Queensland, which has the lowest State contribution, came from a Labor government initiative. Is a Government of that calibre, of that philosophy, going to close down hospitals? It will do exactly the opposite. These hospitals will receive the same consideration from this Minister-who is the best health Minister we have had since Federation-as they received from the Minister for Foreign Affairs (Mr Hayden) when he was administering Medibank and they received from me when I administered the hospital capital construction program and the community health program, which the Liberals have decimated, eviscerated, cut down, wasted and wizened. The Minister will restore community health services and hospital services to something like the decent standards we had under Medibank. Thursday, 15 September 1983 Mr NEWMAN(Bass)(12.02 a.m.) —I make a general observation. One of the threads that have come through Government members' argument in this debate has been that in talking and promoting Medicare they have all told us how this is the most detailed policy that has ever been put into a Bill and presented to this Parliament and how it has remained a central plank of the Australian Labor Party 's platform for years and years. Yet the honourable member for Grayndler (Mr Leo McLeay) took points of order, obviously out of total ignorance of what the legislation is all about. So much for the knowledge of one honourable member about a Bill which is supposed to have been formulated over so many years. The honourable member for McMillan (Mr Cunningham) tried to excuse his delinquency in his electorate by admitting that after all these years of preparation he had finally got around to dealing with one problem in his electorate last Wednesday. He should hang his head in shame. I return to the clauses that we are talking about. Whilst I appreciate the arguments that the honourable member for Capricornia (Dr Everingham) made, I do not think he understands that categorisation is causing a great deal of concern in the electorate. Whilst there may be provisions for appeal, there is still a great number of questions being asked about the criteria which will be applied to private hospitals in finally geting their certification. I hark back to what I began with. If this is such a well-formulated and well-planned scheme I would have thought that these things would have been a little more clear than they are now. I come to another problem of categorisation that the Minister for Health (Dr Blewett) might be able to deal with. It relates to those hospitals which have a mix of acute beds and long term beds. I pose a problem of a hospital which has, say, 80 beds, of which 30 are long term. If it is a normal, run of the mill, private hospital, the long term beds will have a very high occupancy rate. Those beds will represent about 37 or 38 per cent of total bed space available in the hospital. The remaining, say, 63 per cent will be acute care beds and will have a much lower occupancy rate. The overall effect of this will be that perhaps the long term beds will take up, say, 50 per cent of the bed days in that hospital. I am sure that the Minister would readily appreciate that that would mean that that hospital would have a great deal of trouble qualifying as a category B hospital under the criteria which such hospitals understand now apply. The point I am trying to make is: Would the Minister, when looking at that sort of problem , which is not unusual, take into consideration the separation between long term beds and the acute beds in the hospital and make a determination accordingly? In other words, there would be flexibility within a hospital situation to decide the categories which the Minister would apply to them. That is one problem about categorisation. Another problem which goes very much to the heart of the arguments that have been put by many honourable members on this side of the chamber during the debate is the question of competition. I go back to a point that I made in the general debate. Let us take a category B hospital. As I understand it, the rate which would apply to that hospital would be $30. If we take a case which I think is typical of a category B hospital, it would charge, say $130 for a shared private ward. If a patient is insured he would get back $100 from the insurance scheme from the basic cover. The Commonwealth would offer $28 and so the patient would be left with the basic fee being paid but the additional cost of $16 for a medical bed or $28 for a surgical bed would not be paid. So the patient would be up for $30 a day. The officials advising the Minister are all scratching their heads. The Minister can indicate whether I am right or wrong. But that is a situation that has been posed to me. If it is not a real situation then that is the Government's fault because that is the position private hospitals believe will prevail. I will be glad if the Minister can clear up that point because a number of private hospitals in my electorate would be very pleased to have the matter clarified. I come back to the point again: If a person has basic cover and if the contribution by the Commonwealth is taken into consideration, the fee a patient will have to pay in addition to his medical insurance will be of the order of $18 to $30 a day. The other point I make again concerns the question of just how much patients will have to pay for basic health cover. The Minister said it would cost $5 but, as has been said now on several occasions, it could be raised to $7 or $8. I come back to the point of all this which is the question of competition between private hospitals and public hospitals. If there is to be a shift to the public hospital sector-if the sorts of figures that I have now queried and which the honourable member for Mackellar (Mr Carlton) has put forward in the case of bush hospitals are correct-the competition between public hospitals and private hospitals would be such that the drift to the public hospital area will be quite extreme. In my electorate the various assessments being made indicate that it could go as high as 30 per cent. The whole point is that even if there were a small shift private hospitals would find that they would have a drift away from them which would make them quite uneconomical. Worse that that, the public hospital sector would find that it would be deluged with patients which would absolutely choke their services. I would like a clarification of those points by the Minister. I summarise the points that I have made. The first point I raised concerned the confusion that now seems to prevail in relation to the categorisation of hospitals. Secondly, I hope there is some flexibility in the Minister's determinations which will allow for the sort of situation I described where there is a mix of acute and long term beds. Thirdly, and perhaps most importantly, there is the question of the patient meeting the cost of going into a private hospital whilst on basic cover and the fact that unless that is very carefully assessed it will be found that there will be a drift away from private hospitals. That drift would make many of those private hospitals uneconomical but, worse than that, it would choke the public hospital sector. Mr SHIPTON(Higgins)(12.10 a.m.) —Private hospitals are small business employers of significance. I should like to raise tonight the matter of the categorisation guidelines for private hospitals. Apparently, draft guidelines were circulated to private hospitals only last week, and there is confusion in the private hospital sector as to the nature of those guidelines because, apparently, they are not firm or fixed and negotiations are continuing with the Department of Health. I have heard that the Department of Health has shown some willingness to negotiate and, as has been said by some people, to be reasonable. I hope that it continues to be so reasonable. I should like the confirmation of the Minister for Health that the guidelines are flexible and that the anomalies raised tonight will be looked at. After study of the guidelines I have come to the conclusion that the only hospitals with a real future in the State of Victoria are those ranked as category A hospitals. I should like the Minister's comments on that matter later in the debate. I also ask the Minister to look specifically at foundation hospitals, which are obviously set up for taxation purposes, and see whether they get any special rating under the system of categorisation. In my electorate I have one such hospital with 33 beds. There certainly seems to be a number of anomalies with respect to categorisation. My office and I contacted some hospitals today. I found an anomaly in respect to a hospital in the electorate of the honourable member for Melbourne Ports (Mr Holding) which services my constituents and his constituents . The Avenue Hospital, which has 122 beds and which would be category A, is owned by the same business that operates the Peninsula Private Hospital at Frankston, which has 72 beds and proposes to add a further 24 maternity beds. These are efficient, modern, up to date hospitals providing a first class service. Mr Chynoweth —Hear, hear! Mr SHIPTON —Perhaps the honourable member for Flinders will help that hospital with the problem that it will have only 96 beds and therefore will not be a category A hospital. I look forward to the support of the honourable member in the negotiations concerning the reclassification of that hospital. He has become less cheeerful since it was pointed out that the Mornington and Hastings bush nursing hospitals will be wiped out as a result of the Government's proposal. There are a number of other anomalies in this categorisation. The honourable member for Dundas (Mr Ruddock) quite properly raised the matter of special purpose or specialist hospitals. A number of these hospitals are modern. I know of two such hospitals in Melbourne. One is a medical specialist hospital, the Dandenong Pinelodge Clinic Private Hospital. What is its position? I do not believe that under the bed criteria it is a category A hospital. The other is a psychiatric hospital, the Melbourne Clinic, which I think is in Richmond. What is its categorisation? It is a 100-bed hospital, yet under the categorisation that has been circulated it is not a category A hospital; in fact it is a category C hospital. What is proposed to be done in that direction? I must congratulate the honourable member for Mallee (Mr Fisher) for pointing out that the bush nursing hospitals will be wiped out. We have not heard from the honourable member for Ballarat (Mr Mildren) about what is happening to the Avoca , Ballan and Trentham bush nursing hospitals. Mr Chynoweth —They will be looked after all right. Mr SHIPTON —Listen to honourable members opposite bleat. The honourable member for McMillan (Mr Cunningham) made a faint effort to say that something might happen but he did not explain adequately to the people of Neerin, Pakenham, Upper Yarra and Cowes what is happening to their bush nursing hospitals. Mr Cunningham —They know. Mr SHIPTON —They know they will be wiped out. We have yet to hear from the honourable member for Flinders (Mr Chynoweth) as to what is happening to the Hastings and Mornington bush nursing hospitals. Mr FISHER(Mallee)(12.15 a.m.) —I must again refer to this categorisation proposal because it is obviously a very serious situation, particularly in relation to the Victorian Bush Nursing Association. As I understand it, under the proposal benefits payable by the health insurance funds will, for most bush nursing hospitals, be $100 a day. There will be a Commonwealth subsidy of $20 a day. As there are only four bush nursing hospitals in Victoria with average daily bed costs below $100 it is obvious that 34 bush nursing hospitals will be in severe financial difficulty within a matter of months after the scheme is introduced unless patients are prepared to pay up to $55 a day. Of course we must remember that the gap is non-insurable. If this is not the case let the Minister for Health (Dr Blewett) tell us what is the situation at the end of this debate. I will be very pleased if this debate clears up the problem and, in fact, ensures that the system continues. But I think that we should reinforce to the Minister the argument relating to the efficiency of the system. Mr Campbell —Now sit down. Mr FISHER —I will sit down when I am ready. The very existence and efficiency of these bush nursing hospitals has for some 60 years saved successive governments incalculable sums of money when it is considered that the alternative to a bush nursing hospital would, in all probablility, be the provision by the State of a public hospital. In pursuing this point the average occupied bed costs of bush nursing and public hospitals should be mentioned. Mr Cunningham —That is page 17. They are not even your own words. Mr FISHER —It is a pity the honourable member did not mention it earlier. He was going to forget about it. I am glad I have flushed him out. In 1981-82 a bush nursing hospital bed cost $93.98 and a public hospital bed cost $183.19. This means that there is a variation between the cost in a public hospital and in a bush nursing hospital of 85.2 per cent. If we go over the page we will find-- Mr Chynoweth —We are on the page. Mr FISHER —It is a pity that Government members did not come into this debate a lot earlier before honourable members on this side brought to their notice these very important facts. As the Victorian Bush Nursing Association stated: It is not unreasonable to assume that, if bush nursing hospitals were to be taken over as public hospitals, services identical to those now provided by public hospitals would then be provided by bush nursing hospitals with corresponding cost increases in accordance with the following. As members of the Government have now obtained this submission and are reading about the tremendous discrimination that will exist if this policy continues, they will see that in 1981-82 the cost to the public of bed days in bush nursing hospitals was in excess of $16m. The cost of bed days in public hospitals was $ 31m. This shows that by operating the bush nursing system there is a saving to the Australian community of some $14m a year. I repeat with emphasis that the very existence of bush nursing hospitals has saved governments considerable sums of money over a long period. The honourable member for McMillan (Mr Cunningham) has had a lot to say by interjection. All I can say is that I am glad he has finally acknowledged the importance of the bush nursing system, particularly in light of the fact that the first bush nursing hospital was established in Victoria in 1923 in Cowes in his electorate. Mr CUNNINGHAM(McMillan)(12.19 a.m.) —I have to rise to defend the Government and Government members in this situation. The honourable member for Mallee (Mr Fisher) has come into this House tonight and read from a submission which the Victorian Bush Nursing Association put out in June or July. There is one clear message tonight- Opposition members interjecting- Mr DEPUTY CHAIRMAN(Mr Millar) —Order! The honourable member for McMillan will resume his seat. I suggest to honourable members that this is hardly a laudable way to start a new day. It would be in our best interests for honourable members to address themselves more seriously to the matter and refrain from interjecting . Mr CUNNINGHAM —I do not want to take a great deal of time, but I want to say that my first experience in Parliament was as a member of the Opposition. I learnt very quickly in opposition that if I was to be a responsible member of Parliament and to serve my electorate, if I received a submission from an organisation as far back as July, one of the first things I should do with it was to take it to the appropriate Minister and see that he was made aware of the issues. It is quite clear tonight that members of the Opposition have had this submission but have not taken a sensible approach towards it. As the Deputy Chairman has said, they have allowed this debate to go into the very early hours of the morning before even bothering to read from this submission to the Committee or to the Minister for Health (Dr Blewett). If we are going to talk about serving our constituencies and the private hospitals within them, I suggest that members of the present Opposition have a good lesson to learn. They are not in government. They should learn how to use their position in opposition . They should take the facts on behalf of their constituents- Mr Newman —Mr Chairman, I take a point of order. I think the honourable member should be brought to heel and should be made to speak to the clauses at issue. We really do not need a lecture on how to conduct ourselves in opposition. The DEPUTY CHAIRMAN(Mr Millar) —Order! The honourable member for McMillan was persuading me that he was about to get to the point that he wished to make. I call the honourable member for McMillan. Mr CUNNINGHAM —The point I am making is that we have had presented to us tonight and read into the Hansard record parts of a submission put forward by the Victorian Bush Nursing Association in relation to this legislation. I suggest to the Opposition that, as responsible members of the Parliament, that they have left it a little late for the constituents. Members of the Government have already done the work about which Opposition members have been talking tonight. If members of the Opposition cannot do their own work and discuss this matter with their constituents I suggest- Mr Groom —Mr Deputy Chairman, the honourable member is not making comments that are relevant to the clauses before this Committee. He is making excuses. I suggest that the Chair should sit him down. The DEPUTY CHAIRMAN —The honourable member will resume his seat. The honourable member for McMillan is spending too much time in a character analysis of Opposition members. I suggest that he come more particularly to the matter before the Committee. Mr CUNNINGHAM —In conclusion, I have been in constant touch with the bush nursing hospitals in my electorate in relation to this legislation. I said earlier that the first intimation I had that there was any difficulty in relation to this legislation was when a Press release was put out last Monday, 5 September, by Mr Foyster, the Chief Executive Officer of the Victorian Bush Nursing Association. In my contact with the hospital committees and the people in my electorate I have not found the alarm shown by the chief executive officer . My contact with the Minister has clearly indicated that the clauses in this legislation are not of great concern to those people and those hospitals. The Minister will reply to the debate tonight. I am sure that he will deal with the approach taken by the Opposition, in particular the honourable member for Mallee (Mr Fisher) who just read from paragraphs 8.10, 8.11, 8.12 and 8.13 of the Bush Nursing Association submission. He did not put very much of his own work into the speech. I suggest that the Opposition has very little to hang its hat on. Mr CARLTON(Mackellar)(12.24 a.m.) —Before making any specific points about the clause that I want to refer to, I would like to respond to what the honourable member for McMillan (Mr Cunningham) has said. It is really most unacceptable to be lectured by the honourable member in this manner. If he had been in the chamber when I dealt with the matter of the Victorian Bush Nursing Association in my speech in the second reading debate he would know that the Minister for Health (Dr Blewett) had not responded to representations from the Bush Nursing Association over some period. The Association claimed that its representations had been lost somewhere in the Department of Health. It sent other representations. I checked this morning with the Executive Director of that Association before I came into the House to make certain that I was up to date with information as to whether the Minister had agreed to see that Association. It is claimed that the Association did not call on Australian Labor Party members in certain electorates. Yet the honourable member for Cunningham produced material tonight in the chamber which he said he got in July. Mr Newman —No, it was produced in July. He did not get it until last Wednesday. Mr CARLTON —I am informed that the honourable member got material from the local hospitals of the Victorian Bush Nursing Association last Wednesday. He still failed to make contact with his Minister or, if he did, his Minister failed to get back to the Bush Nursing Association. If there is any embarrassment about this matter in the House today it is embarrasment of the Government, certainly not of the Opposition. It is up to the Government to sort out the matter of the Bush Nursing Association. The other point that I would like to make about this, and it is more general, is that these clauses represent a further development of Commonwealth bureaucratic control of the private hospital system. If there is a problem in regard to payments to private hospitals around Australia and, as would any sensible person, I accept that there could be in respect of some of the payments being made by private funds-most are made by such funds because there are relatively small Commonwealth contributions under the existing scheme-it could be approached by re-ordering the private insurance schemes. But I suggest that to have the Federal Minister and his Department involved to this degree is, going in the wrong direction. If we needed any illustration at all of that we have seen how difficult it is for the Minister to respond in a Federal Parliament to matters concerning individual hospitals when, obviously, there are differences as from one place to another and the Federal department does not even appear to acknowledge the existence of this Bush Nursing Association, for instance. That merely suggests that this whole group of clauses relating to private hospitals is going in the bureaucratic direction in which this Minister likes to see health care delivery going. I want to raise a specific point on clause 40 of the Bill, which repeals existing section 33 of the principal Act and inserts a new section 33 which provides for the making of daily bed payments by the Commonwealth to the proprietors of private hospitals. Sub-section (1) of new section 33 provides for a daily bed payment to be made to the proprietor of an approved private hospital for each day on which an eligible person is an in-patient for a period of more than 12 hours. I am informed that the provision of a 12-hour minimum stay for a day patient has been put in the Bill without adequate consultation, if any, with major private hospital groups. I was speaking to one of these people today in the course of my checking process to make sure that I would be up to date upon coming into the House. I was told by the executive officer of a major group that would expect to be consulted on the matter that there had been no consultation and the 12-hour period had been set arbitrarily. I sincerely ask the Minister to review this provision. It ought to be amended. Perhaps I could state just three of the problems in relation to it. If a 12-hour minimum is to be set down-currently there is not-it will ne necessary to have more than one shift of staff involved. The costs of dealing with day patients will increase enormously if their stay goes across two shifts. From the patient' s point of view it is a very bad provision because normally, for most of these surgical procedures done on a day basis, patients come in at 7 o'clock in the morning and like to get home by 5 o'clock in the evening. Now, unless they stay until 7 o'clock they could get a bill for $70 or $80 which would not be covered by insurance. Mr Leo McLeay —What happens at half past 12? Mr CARLTON —I do ask the honourable member for Grayndler to treat this matter seriously. Previously he demonstrated an extraordinary ignorance of bush nursing hospitals. Someone who has chaired a committee inquiring into the care of the elderly should display more responsibility concerning these matters. Mr Leo McLeay —The Opposition spokesman will be going at half past four-- The DEPUTY CHAIRMAN(Mr Millar) —Order! Honourable members will remain silent. An important matter is before the Committee. I suggest that they address it seriously. Mr CARLTON —I shall continue although I am perfectly happy to resume the debate in the morning. The business of the House is in the hands of the Government. If it wishes to have these important matters debated at sensible hours it can take the necessary steps. It is the duty of the Opposition to raise these very important points. If the Government does not wish us to question a provision which requires a minimum of 12 hours for day patients in private hospitals, let it say so and let it be counted on it. Let me go on to the concern about the patients who are required to come in for a minimum of 12 hours for day procedures rather than the shorter period of eight hours. If they come in at 7 o 'clock in the morning they would usually be ready by 5 o'clock to leave in the ordinary course of events. This would require one shift of the staff. Unless they stayed until 7 o'clock in the evening they would get a bill of $70 or $80 not covered by private insurance. To keep them in unnecessarily for two hours is just lunacy. The third problem is that there is a question of allocating the bed. If the bed had to be allocated until 7 o'clock on a 12-hours basis, the hospital could not admit another patient overnight for other overnight procedures. There may be an operation on a patient the following morning. The patient could be admitted to the same bed after a previous patient had left, say, at 5 o'clock, but that would not be possible. They are just three cogent reasons why this minimum period of 12 hours should be revised. I earnestly ask the Minister for Health ( Dr Blewett) to consider an amendment to that particular clause. Mr GROOM(Braddon)(12.32 a.m.) —People are very confused about this scheme and they are now at the stage where they wish to make decisions about private insurance. I would like to direct a particular question to the Minister for Health (Dr Blewett) who is at the table and trust that he can provide us with some guidance tonight. For example, let me take the St Vincent's Private Hospital in Launceston in northern Tasmania, which will probably be a category B hospital. I am informed that the daily bed cost will be $130 a day. The amount that will be recovered from the Medicare payment will be $30 a day, leaving a balance of $100 plus additions. They are only round figures. Like many other members, no doubt, I have had constituents come to me and say: 'What should I do ? What advice can you give me'? I would like to know whether the Minister can indicate, at this stage, what it is likely to cost a person in that situation if he wants to attend that hospital and be covered for the full costs for care. What is the cost to the individual? What would be the cost to a family? I put this question seriously. If the Minister does not know now from his consultations with the private medical funds, can he say, since the legislation is supposed to start on 1 February, when the public is likely to find out these facts so that it can make decisions? Dr BLEWETT(Bonython-Minister for Health)(12.34 a.m.) —First of all, the honourable member for Dundas (Mr Ruddock) applied what was the first and sensible question; that is, do I believe that some private hospitals have been charging fees which are excessive? My answer to that is, quite clearly, yes. It is an affirmative answer which would be given by anybody who has examined the private hospital situation over the last two years. Some of the sorts of evidence one can bring to having that belief are the way in which private hospital fees have piggy backed on purely arbitrary State government public hospital charges over the last two years as a result of the last health insurance change of the previous Government. One can compare the quite extraordinary narrowness of range of private hospital charges despite the very different costs of those hospitals. Another piece of evidence is to recognise that many of the hospitals we are talking about provide services very similar to good nursing homes and yet charge a bed day charge three times that of the nursing home. All of that evidence is around. If honourable members opposite were at all concerned with issues of cost containment of health in this country, they would realise that an honest government has to face those kinds of problems. The honourable member for Mackellar (Mr Carlton) said: 'Well, I do not think the Commonwealth Government should be getting involved in this issue. I do not think it should be pursuing cost containment in this area'. Not too much money is involved at the Commonwealth level in this sort of issue. I think it is about time that I reminded the House of what the taxpayer does contribute directly out of Commonwealth funds to the private hospital sector. Last year it was some $86.7m. In the first full year of Medicare it will be $133 .2m. If the Commonwealth taxpayer is to be asked to provide those subsidies-all Commonwealth taxpayers, not just the ones using private hospitals-this Government accepts the responsibility that there must be efforts to contain costs in the private hospital area. Let me illustrate what we have tried to do generally with this legislation. We have tried to provide at the cheapest possible level a portable private insurance which would be portable between private sections of public hospitals and a whole range of different cost private hospitals. In order to get that insurance figure down as low as possible, we have to look very carefully at costs in the private hospital area. That is the fundamental assumption which underlines the policy. I think they are perfectly defensible policies for any government which is concerned with cost containment and which has a responsibility for the expenditure of taxpayers' money. However, I think we have tried, as far as possible, to create a system which will, on the whole, benefit the best private hospitals in all catergories. We have tried to provide, through this system, as low a level of insurance rating as possible and to make it portable between the different types of hospitals. A lot of misinformation is being fed around on this issue. I suppose that is always possible because, as with the previous Government's health schemes, these final details of what the private insurance people will actually charge are not usually available when the legislation is drawn up because they relate to that legislation. Let me say, first of all, that there has been no categorisation of any hospital . As part of the Government's consultation with all the groups concerned, the principles of categorisation have been sent to the State governments concerned, the private hospitals associations concerned-that is, the representative private hospital associations-in each State and also to the Voluntary Health Insurance Association of Australia because the insurance industry is equally concerned with this issue. We are waiting for responses to those guidelines. This is part of the consultation which we have embarked upon in relation to this and a whole range of matters in the area. Let me assure people that there has been no categorisation as yet, that the bodies concerned are being consulted for their views on the draft guidelines which have been circulated. When categorisation does take place there will be appeal procedures. We are aware that the two issues which have been raised tonight are peculiarly difficult, that is, the particular nature of the bush nursing hospitals in Victoria and certain private psychiatric hospitals in various parts of Australia . As people have pointed out, the bush nursing hospitals in Victoria are in a unique situation-certainly that pattern of bush nursing hospitals provisions- which is not found in most other States. Much misinformation has been circulated on this matter, some of it, I am afraid, by the Victorian Bush Nursing Association itself. For the past 10 years-whether under the original Medibank scheme or under the five different schemes which were introduced by the Fraser Government-anyone who sought treatment in those bush nursing hospitals, be they a pensioner or a member of the general public, had to have private hospital insurance to cover them for the expense of that stay. They had to have insurance which would provide private hospital cover. Pensioners have not been able to go into those bush nursing hospitals without taking out private insurance cover. Of course, the same is true of ordinary members of the public. That situation has existed for more than a decade. Of course, it will exist under Medicare. If people wish to make use of these hospitals they will have to take out the extra private hospital insurance. As I say, bush nursing hospitals are private hospitals and are not covered, therefore, by the current pensioner health benefit card or the health care card. People will not be able to obtain services through the Medicare system in bush nursing hospitals as in all other private hospitals. They will need that extra private insurance. However, I point out that at the moment hospital insurance costs from the private funds, in order to cover oneself for treatment in a bush hospital, are approximately $8 a week. Under Medicare that extra cover will cost about $5 a week for many of the reasons we have-- Mr Carlton —You do not know that. Dr BLEWETT —It will be about $5 a week for many of the reasons I have already stated. Mr Cadman —But they will pay twice. Dr BLEWETT —We are now talking only about the hospital cover. The levy will cover their medical treatment. So, if we add their income and the figure of approximately $5, we will find that two out of three families will pay less for that cover. The remaining one-third of families will pay more. I point out that if people want private hospital cover they can obtain it at a cheaper cost than they can get it at the moment. Nevertheless in relation to the categorisation, there remain particular issues with regard to bush nursing hospitals in Victoria . I am having consultations with the Minister for Health in Victoria because he is aware of specific problems in this area. We will look very carefully at the points made in the submission, when decisions are made in relation to categorisation. I think we have a unique problem. We will do our best to meet it. I have also assured the private hospitals that we will monitor very carefully the pattern of occupancy over the six months. If problems arise we will look at ways in which we can cope with that problem. On the evidence of Medibank there is no expectation that that will occur. The interesting thing was that in the one full year of Medibank, the 1975-76 year, occupation of private hospitals went up, not down. It may well be that a similar pattern will occur on this occasion. Certainly, the evidence of 1975-76 would suggest that that may occur. We have been made thoroughly aware of the specific problems in relation to bush nursing hospitals. We will have consultations with the Victorian Government over this matter. We will look at it very carefully in relation to categorisation. The same applies to certain psychiatric hospitals which again create problems in relation to the basic principles we have laid down for categorisation. That is why people have sometimes drawn conclusions from those draft principles which may not be applicable when the final principles are arrived at. There is a special problem in relation to certain high quality psycho-geratric provisions in certain States. I assure the honourable member for Dundas that we are aware of both the general problem and the particular problem in relation to the hospital to which he referred. We will do our best to meet it. Finally, I make the point with which I began: We do have cost containment responsibilities. I would have thought that all rational members on both sides of the House would be looking at ways in which we can produce a private insurance system in relation to private hospitals whereby people can pay as little as possible for that insurance and be guaranteed that hospital charges are appropriate. Mr RUDDOCK(Dundas)(12.43 a.m.) —I appreciate the comments of the Minister for Health (Dr Blewett) particularly his last remarks, as they were directed specifically to some of the questions I raised. But I would like to have some further elaboration on the matters that have been of concern to me. I appreciate his acknowledgement that cost containment was very much the principle that was involved in the establishment of these categories, along with the expectation that there will be a reduction in the income of some hospitals. I pointed out in my remarks that that could in some cases cause very considerable hardships. While I recognise that the Health Insurance Amendment Bill will allow for appeals-I recognise also that the Minister has certain responsibilities-I am concerned at the lack of information that I have received. I do not know whether the shadow Minister for Health, the honourable member for Mackellar (Mr Carlton) , has been provided with a copy of the principles that are to be involved in the categorisation of hospitals; I have not seen that information. Yet I learn that it has been made available and is apparently ready to be seen by the State governments and by private hospital organisations. I am not complaining about the fact that it has been made available to them. My concern is that those principles that are very important to the way in which hospitals in my electorate, for instance, are likely to be assessed and to understanding the way in which these clauses of the Bill will operate have not been made available. I appreciate that they have been made available to the Private Hospitals and Nursing Homes Association of Australia, the State governments, and now the bush nursing hospitals, but I have not seen them. A question arose in my mind as I listened to the assurances by the Minister for Health that those hospitals operating particularly in the psycho-geriatric area were going to be especially examined. Do these principles that have been circulated to the Private Hospitals and Nursing Homes Association of Australia and the State governments state that psychiatric hospitals are all to be in one category? I suggest that from the way the Minister answered the question perhaps that is the case. My concern and that of the hospitals is very real. Whilst I accept that the Minister has indicated that he now appreciates that there are special cases that need to be examined-no doubt there will be a number of other special cases that need to be examined-I would like to know whether or not principles are to be amended if, as I have suggested, the Government says all psychiatric hospitals are to be category C. I also extend to the Minister a personal invitation-I know he has received one from the Sisters of the Little Company of Mary-as I have extended a personal invitation to the shadow Minister for Health, the honourable member for Mackellar, to visit the hospital in my electorate which, as I have said, is involved in teaching psychiatric nurses. When I spoke earlier I did not give to the Committee some information about the nature of the program in which Mount St Margaret Hospital is involved as a nursing training school. It has been conducted as a non-funded training school for something over 50 years. That may be because the funds have been used for training psychiatric nurses and it may be the view that they are making too much profit. It may be the view that it is not appropriate for a private hospital to be involved in training. I would argue to the contrary. I think it is a very proper role for the hospital to play. The hospital is affiliated with the Western Metropolitan Educational Centre situated in Parramatta. During its time, over 200 students, not including the religious staff, have graduated from the hospital. Some 27 students are presently involved in that school. For many years-not only in the last two years -graduates from the school have topped the State and have also been recipients of the Norton Manning medal for nursing excellence. That is an indication of the quality of teaching that is offered at Mount St Margaret Hospital and very much reinforces the view I spelt out in my earlier remarks as to why this hospital needs to be considered especially. I know that other hospitals have special problems that will need to be looked at. I have visited a hospital also in my electorate where young babies are cared for. It is a hospital only for babies. It is a unique private hospital, the only one I know of that is very much involved in that work. It has a very different sort of program from those of other hospitals. Of course, hospitals that have a surgical capacity and operating theatres and so on have additional expenses that the categorisation is obviously designed to take into account. But there can be other special facilities hospitals provide that are not of that character that need to be taken into account. That is why I think it is very important that honourable members are able to see these principles, that we are able to look at them and understand, against our own knowledge, the way in which hospitals in our electorates operate and the sort of factors that will be taken into account. I am very concerned that if the extensive appeals procedures that are outlined in the legislation are to be availed of, if hospitals are made uneconomic by the way in which they have been categorised and they have to use these appeals procedures in order to test the decisions that may have been reached by the Minister in concert with his officers, we could run the real risk of some of these hospitals closing. If hospitals are made uneconomic as a result of these categorisation proposals, and if hospitals close, it is very unlikely that those facilities will be re-opened. I think it is important that the principles as well as the decisions reached under those principles be tested, although that is not a matter I have looked at in any detail. I certainly hope that is so. It is important that any appeal be treated expeditiously because, if hospitals are forced to close, it is most unlikely that other entrepreneurs will involve themselves in the expense of opening hospitals and building hospitals. If we are without those facilities, the pressures that might be placed upon our public hospital system will be enormous. In the western region of Sydney we have some very fine public hospitals. I do not want my interest in private hospitals to indicate that I lack an interest in public hospitals or have an unwillingness to use them. I was recently hospitalised. Mr Uren —In a hospital funded by a Labor government? Mr RUDDOCK —The Minister will be pleased to know that my experience was in Westmead Hospital which was planned by a Liberal government in New South Wales and which, at a period when the Labor Party was in office, received some funding to enable it to continue. Of course, it continued to receive funding from Liberal governments over a period until its recent completion. The fact is that both Liberal and Labor governments have been involved in the funding of that hospital. It is a very fine hospital. Of course, I regret that another very fine hospital, the Parramatta Hospital, had to change its role, which caused very considerable anguish in the western suburbs of Sydney. I do not want my interest in private hospitals to indicate a lack of interest in public hospitals, but I want it to be known that that very fine Westmead Hospital in the western suburbs of Sydney is in considerable difficulty in meeting needs because of a shortage of beds and has to postpone elective surgery because it cannot meet present demands. If the surgical hospitals in my electorate were forced to close because of these categorisation proposals, very considerable demands would be put upon Westmead Hospital and other hospitals where there clearly is a shortage of beds. I am very much aware of this problem. I want the Minister to be aware of it. I want him to be aware that I, along with other members, will be monitoring closely what happens. If there are any problems in relation to these matters, I will certainly be prompt in ensuring that they are raised with him not only privately but also in the House. Mr SHIPTON(Higgins)(12.53 a.m.) —I ask the Minister for Health (Dr Blewett) whether he would state to the Committee that he is prepared to be open-minded and reasonable and take a personal interest in this matter of categorisation in the future. Following his statements concerning specialist psychiatric hospitals , I also ask him whether he would regard specialist surgical, specialist medical , specialist maternity and specialist pediatric hospitals in the same light as he would regard specialist psychiatric hospitals. I point out to the Committee the position in relation to bush nursing hospitals as I understand it: Everyone without a pensioner health benefit card would pay the levy and would need to pay private insurance. I take that from what the Minister said a few minutes ago. I am prepared to wager with the Minister that the cost of that private insurance is nearer $10 a week than $5 a week, which means that everyone attending a bush nursing hospital will be much worse off and will be paying nearer double what they pay under the present system. Dr BLEWETT(Bonython-Minister for Health)(12.55 a.m.) —I will reply to the last two points of the honourable member for Higgins (Mr Shipton). If the honourable member had listened earlier in the evening he would know that I explained the reasons why we are fairly confident about the $5 figure. From at least one major fund we have had advice to the effect that the private insurance rate can be about that figure. There are very obvious reasons for that, which I went through at an earlier stage of the proceedings. On the question of specialist hospitals, I think that is not a particular problem about which I have to assure people because the implications of the guidelines are quite favourable to specialist surgical, maternity and orthopaedic hospitals. We are worried about the way the guidelines work in relation to some psychiatric hospitals. Mr Shipton —They say that hospitals have to engage in at least two of certain types of specialist services. I am asking whether one of those types of services would be enough. Dr BLEWETT —As I said, my understanding of hospital concerns is that those in the various categories the honourable member mentioned are not particularly concerned. General small bush nursing hospitals raise a particular problem and specialist psychiatric hospitals seem to be possibly disadvantaged by the guidelines in their present form. In answer to the honourable member for Dundas (Mr Ruddock) I must say that at this hour of the morning one gets a little strained with some of the things that are said. I wish he had displayed the same concern for Australian public hospitals 2 1/2 years ago when his Government was squeezing the States, and therefore squeezing the public hospitals. I wish he really had displayed the same concern then for the public hospital system as he now seems to display for the private hospital system. The second point I wish to make is that the honourable member for Dundas, like many other members of the Opposition, seems to have forgotten that the Opposition is no longer in government. It has never been the practice of this Government, or of the Opposition when in government, to circulate to all members of the Opposition draft guidelines while they are still being prepared by the Government and the organisations concerned. I point out that those guidelines, under this legislation, will have to be submitted to both Houses of Parliament for approval and they can, of course, be disallowed. So I think that we offer sufficient protection with the parliamentary system. Question put: That the clauses be agreed to. (The Deputy Chairman-Mr P. C. Millar) The Committee divided. Ayes . . . . . . . . . . . 64 Noes . . . . . . . . . . . 40 —— Majority . . . . . . . . . 24 —— Baldwin, P. J. Johnson, LesBeddall, D. P. Jones, BarryBilney, G. N. Keating, P. J.Blanchard, C. A. Kent, L.Blewett, N. Keogh, L. J.Bowen, Lionel Klugman, R. E.Brown, John Lindsay, E. J.Brown, Robert McHugh, J.Brumby, J. M. McLeay, LeoCampbell, G. Maher, M. J.Charles, D. E. Mayer, H.Charlesworth, R. I. Mildren, J. B.Chynoweth, R. L. Milton, P.Cohen, B. Morris, AllanCross, M. D. Morris, PeterCunningham, B. T. (Teller) Morrison, W. L.Darling, E. E. Mountford, J. G.Duffy, M. J. O'Neil, L. R. T.Edwards, Ronald Punch, G. F.Everingham, D. N. Saunderson, J.Fatin, W. F. Scholes, G. G. D.Free, R. V. Scott, J. L.Fry, K. L. Simmons, D. W.Gayler, J. Snow, J. H.Gear, G. Staples, P. R.Griffiths, A. G. Steedman, A. P.Hand, G. L. Theophanous, A. C.Holding, A. C. Uren, T.Hollis, C. Wells, D. McM.Howe, B. L. West, S. J.Humphreys, B. C. Willis, R.Hurford, C. J. Young, M. J. (Teller) Aldred, K. J. Hunt, R. J. D.Andrew, J. N. Katter, R. C.Anthony, J. D. Lloyd, B.Braithwaite, R. A. McGauran, P. J.Cadman, A. G. MacKellar, M. J. R.Cameron, Ewen (Teller) McVeigh, D. T.Cameron, Ian Macphee, I. M.Carlton, J. J. Moore, J. C.Coleman, W. P. Newman, K. E.Connolly, D. M. O'Keefe, F. L.Dobie, J. D. M. Porter, J. R.Drummond, P. H. Robinson, IanEdwards, Harry Rocher, A. C.Fisher, P. S. Ruddock, P. M.Groom, R. J. Shipton, R. F.Hall, Steele Sinclair, I. McC.Hawker, D. P. M. Spender, J. M.Hicks, N. J. (Teller) Street, A. A.Hodgman, W. M. White, P. N. D.Howard, J. W. Wilson, I. B. C. Reeves, J. E. Fife, W. C.Dawkins, J. S. Lusher, S. A.Jacobi, R. Cowan, D. B.Child, J. Goodluck, B. J.Beazley, K. C. Tuckey, C. W. Question so resolved in the affirmative. Clauses 46 to 48-by leave-taken together, and agreed to. Clause 49 (Medicare Benefits Advisory Committee). Mr CARLTON(Mackellar)(1.05 a.m.) —Clause 49 relates to the Medicare Benefits Advisory Committee. It amends section 66 of the principal Act to refer to the Medicare Benefits Advisory Committee instead of the Medical Benefits Advisory Committee. The Opposition has no particular quarrel with that, if one has to have Medicare, but paragraph 1 (b) of the clause amends the section so that the Minister no longer has to consult with the Australian Medical Association before appointing the medical practitioner members of the Committee. This Medicare Benefits Advisory Committee is a very important committee because it gives advice to the Minister on what should be on the medical benefits schedule. Therefore, the Opposition would certainly like to know why it is that those who have been involved in at least advising the Minister on the membership of this committee for so long, and who presumably have provided particular skills in that direction, are being excluded from consideration. I am concerned about this because the Minister may well have the intention of stacking this committee with a whole series of people whose views might be inimical to private professional practice. One can consider a committee consisting of Dr Marr of the Doctors Reform Society, Dr Refshauge, the State Labor candidate for Marrickville ; Dr Deeble, the adviser to the Minister; and perhaps Professor Opit from Melbourne. Dr Blewett —They have to be medical practitioners. Mr CARLTON —There is a whole host of names. I was going to say Dr Maddern, but I do not think he is a medical doctor either. The serious point in this is that we are concerned that a body which has the job of advising the Minister on the nature of the medical schedule of fees and on the items that would be on that schedule should include a number of private practitioners, people committed to private practice. If it is dominated by people who are merely representatives of the State or Federal bureaucracies or who are representatives of the kinds of elements in the medical profession that have consistently and publicly supported this Minister in his nationalisation procedures, we would be very concerned indeed. So we ask the Minister why it is precisely that he is excluding the Australian Medical Association from compulsory consultation in the formation of this Committee. Mr SPENDER(North Sydney)(1.09 a.m.) —I re-emphasise the point which has just been made by the honourable member for Mackellar (Mr Carlton). In a later provision of the Health Insurance Act, section 80, which is part of a division which deals with the establishment of a Medical Services Committee of Inquiry- sub-section 3 states: The members of each Committee shall be appointed by the Minister and four of them shall be so appointed after consultation by the Minister with the Australian Medical Association. Section 80 is not in any way touched by any amendment in the proposals before the Committee. If one goes back to clause 49 one sees that in section 66 of the principal Act, the Health Insurance Act, as the honourable member for Mackellar has pointed out, any need for the Minister to consult with the Australian Medical Association is specifically excluded, yet the appointment is otherwise in the same terms. Section 66 (2) in its present terms provides: The members of the Committee- that is the Medical Benefits Advisory Com- mittee- shall be appointed by the Minister and four of the members who are required to be medical practitioners shall be so appointed after consultation by the Minister with the Australian Medical Association. It is obviously not a tidying up provision. If it were a tidying up provision the other sections of the Act would also be tidied up. One asks oneself why this is. The obvious answer is that section 66 and related sections deal with the appointment of a committee which will have the function of determining fees. The other committee, which is dealt with in section 80 and associated sections, whilst it has a very important function to fulfil, does not deal with the subject of fees. The only inference that one can draw in the absence of anything on the subject in the explanatory memorandum or in the Minister's second reading speech, is that the purpose of excluding consultation with the Australian Medical Association on such an important subject is that the Government desires to be in a position to appoint tame appointees who will go along with its views. So for that purpose it wants to put aside any consultation with the Australian Medical Association, because that could be difficult, embarrassing and not in accordance with its desires. We would be very glad to hear from the Minister upon the subject. Dr BLEWETT(Bonython-Minister for Health)(1.12 a.m.) —The new clause 49 does not exclude the Minister from consulting with the Australian Medical Association. It removes the requirement that the only medical body to be consulted in relation to the Medical Benefits Advisory Committee should be named as the AMA. We believe that in the pluralism which is now characteristic of the medical profession it is inappropriate that only one body should be named as the required body with which the Government should consult. It is certainly not my intention to preclude consultation with the AMA but that clause leaves it open for the Government to consult with other bodies as well. Mr SPENDER(North Sydney)(1.13 a.m.) —In that event I ask the Minister why, if he is so interested in pluralism, he does not apply the principle of pluralism to section 80. Section 80 (3), as I have pointed out, states: The members of each Committee shall be appointed by the Minister and four of them shall be so appointed after consultation by the Minister with the Australian Medical Association. Apparently pluralism is not necessary in section 80 or when one is dealing, as that section deals, with the appointment of a Medical Services Committee of Inquiry. But somehow the sacred concept of pluralism creeps into the appointment of a medical benefits advisory committee. The Minister has not answered the question and he has-no doubt unintentionally-not correctly described the operation of section 66. That section in its present form specifically casts an obligation on him to consult with the AMA about the appointment of four medical practitioners to the Medical Benefits Advisory Committee. In view of his explanation I ask: Why does pluralism apply in one part of the Act and not in another part? Will he please come clean on the subject? Dr BLEWETT(Bonython-Minister for Health (1.14 a.m.) —In relation to the point about obligation, we simply desired to remove the obligation to consult a single named medical organisation, given what I say is the pluralism of the profession. This does not mean that we would exclude consultation with the Australian Medical Association, but we may well consult other bodies. On the second point that was raised, this Bill deals with a whole range of issues, including fees, and we have made this change to deal with those sets of problems. I will certainly take on board the point made by the honourable member for North Sydney (Mr Spender) when we deal with legislation affecting inquiries into fraud and overservicing. Mr HODGMAN(Denison)(1.15 a.m.) —The Minister for Health (Dr Blewett) has refused to give a direct answer to the matter raised by the honourable member for North Sydney (Mr Spender). The point is that the honourable member for North Sydney has caught the Minister out. The Minister claims that because he supports pluralism, this provision does not mean the Australian Medical Association will not be consulted but it does take away a statutory provision which hitherto required the Minister to consult with the AMA. I again ask the Minister why he draws a direct distinction between the amendment to this clause and the provisions of proposed section 80. Clause agreed to. Clauses 50 to 56-by leave-taken together, and agreed to. Clause 57 (Prohibition of certain medical insurance). Mr MacKELLAR(Warringah)(1.16 a.m) —Clause 57 is at the very heart of the provisions that have been put forward by the Government in this Bill. Clause 57 prohibits anybody other than the Commonwealth of Australia from operating medical insurance schemes. This is the nationalisation provision in this Bill. This is the clause which we oppose absolutely. We cannot agree to a measure which gives the Commonwealth an exclusive right to operate medical insurance schemes. Indeed, the whole nature of this clause makes one very concerned about the intention of the Government towards the insurance industry as a whole. It is not only a prohibition on medical insurance schemes being conducted by the voluntary health insurance funds but also it is a prohibition on medical insurance being conducted by anybody-by commercial insurers or anybody else. There is also a very serious doubt as to whether health maintenance organisations would be allowed under this particular provision. When I spoke earlier today in the debate at the second reading stage I said that this measure was a nationalistion measure. I referred to the fact that it transferred $1.7 billion out of the private sector into the public sector through additional taxation, in that it got rid of 5,000 private sector employees and built up a public instrumentality, Medibank, into a much larger body. I pointed out that essentially it moved decisions about health care away from patients and providers in the direction of the Public Service and politicians. In the context of those remarks, surely this clause is at the very heart of the intentions of the Government. There is no way that we can support this clause. We will fight it tooth and nail. We will vote against it. Mr HODGMAN(Denison)(1.17 a.m.) —I desire to add to the remarks made by the honourable member for Warringah (Mr MacKellar) in opposing this clause. Indeed, it is the only substantive clause in the Bill on which I will speak at any length and I do so so that the people in Australia and the people who read Hansard will know that this is not only a move to nationalise, but also a move to socialise. It is a move introduced by a socialist government. It did not spell out, prior to 5 March, the precise details of the legislation which it intended to bring in and, as the honourable member for Mackellar pointed out so forcefully this morning, in introducing this scheme, you have committed a major breach of one solemn election pledge in relation to the health rebate. You might think that because you have the numbers in this House you will get away with it. The DEPUTY CHAIRMAN(Mr Millar) —Order! The honourable member will address the Chair. Mr HODGMAN —As I say, Mr Deputy Chairman, in accepting the ruling that you give, your chickens will come home to roost in relation to proposed new section 126. The fact of the matter is that you are rationalising- The DEPUTY CHAIRMAN —The honourable member must not address directly honourable members of the Committee. He must address the Committee through the Chair. Mr HODGMAN —I point out through you, Mr Chairman, as the honourable member for Mackellar has pointed out, that this creates a monopolisation, a nationalisation and a socialisation of what up until now has been the province of private enterprise and the property of the people of Australia. The Government will be taking it out of the hands of the consumers and of the deliverers and placing it in the hands of socialist politicians and bureaucrats who may well become themselves victims of Medicare because, as the honourable member for Mackellar has pointed out, the Government's Medicare of today is a replica of the Australian Labor Party's original horrific Medibank. I am not prepared, on behalf of my constituents and of the State that I have the honour to represent in this Parliament, to remain silent while the Government proceeds to nationalise and socialise. The Minister for Health has always been regarded as a person of considerable intellect. He is an academic. But when it is put to him on the line that he is the principal socialist in this Government, that he is the architect of socialism in relation to the health insurance industry, he coyly says 'No, what we are doing is perfectly reasonable '. What the Government is doing is socialism, it thinks, by stealth-because it did not think that the Opposition, so ably led on this matter by the honourable member for Mackellar, would still be debating this subject at 20 minutes past 1 o'clock this morning. But we shall do that because we believe in private enterprise, the rights of the individual, and a free Australia. We shall not remain silent while this Government, by stealth, converts this country to a socialist republic. I conclude with a prediction. The bank nationalisation scheme of the late J. B. Chifley brought down the Chifley Government. The Medicare nationalisation, the socialisation of health insurance in this country, will bring down Australia's second socialist government in 11 years, the Hawke Government. Last, but not least, I want to throw into this ring-I throw it with some pleasure-a little question. I ask the Minister to tell us under what head of section 51 of the Constitution he bases his power to nationalise the health insurance industry. He might glibly say that it is the insurance power, that it is the corporations power, or that it is the trade and commerce power. I ask the Minister to tell this Parliament here and now on what basis he says that this section of the proposed legislation is constitutionally valid. I make these comments with some feeling because this Government, earlier this year, used its power to introduce into this Parliament, by weight of numbers, legislation in relation to the Constitution. I ask the constitutional question: Tell us on what basis this is valid. I suggest that it is not valid. Dr THEOPHANOUS(Burke)(1.23 a.m.) —We cannot allow the outrageous comments of the honourable member for Denison (Mr Hodgman) to go unchallenged. He appears to perceive socialisation under every bed. The situation seems to be that the honourable member has used the word 'socialisation' in discussion of virtually every measure that has come before the House of Representatives in the last two weeks. His whole conception of what constitutes socialisation is so incorrect as to be laughable. Mr Robert Brown —It is paranoia. Dr THEOPHANOUS —As the honourable member for Hunter says, it is paranoia on the part of the honourable member for Denison. Opposition members interjecting- Dr THEOPHANOUS —The Minister for Health (Dr Blewett) says that the honourable member cannot claim for Portnoy's complaint. The DEPUTY CHAIRMAN(Mr Rocher) —Order! The honourable member for Burke does not need any help. Dr THEOPHANOUS —It is a little difficult to be serious when one is replying to the honourable member for Denison. The fact of the matter is that this is not a measure for the socialisation of medicine. If the honourable member knew anything about the systems which have socialised medicine and has compared what is happening here with what has happened in systems where medicine has been socialised even he, with his thick mind, would be able to perceive the difference. The fact of the matter is that this legislation is designed to overcome the extraordinary problems and the complexities brought about by the multiplicity of mad systems created by the five different schemes of medical insurance of the conservatives. What we are doing in this legislation is putting some kind of rationale into the system. Some principle of efficiency and rationale has to be put into place. The conservatives seem to think that the principle of rationality or efficiency should not ever apply to anything. We will not be deflected from the task of establishing a national insurance system, because national systems are in the national interest. Honourable members opposite have never heard of the national interest. They think that anything that will maximise profit for a few small groups in the community is a sufficient reason to argue for it. They simply are not interested in looking at the national interest in relation to this matter. Let me make it quite clear that we will proceed with this legislation. We believe its context is extremely fair. It takes into account the considerations of the medical profession. Under this legislation people have freedom to choose doctors, and doctors have freedom to charge whatever fees they want. All of these freedoms are part of this system. For the honourable member for Denison to claim that this is socialised medicine is simply absolute nonsense and total rubbish, and ought to be rejected. Mr SPENDER(North Sydney)(1.28 a.m.) —I would like to ask the Minister for Health (Dr Blewett) one or two questions about the rationale for clause 57. In his second reading speech the Minister made it perfectly plain that he was supporting and promoting very directly the concept of bulk billing. Bulk billing , of course, means that doctors will charge 85 per cent of the schedule fee. The Minister gave an explanation in regard to abolishing what was called gap insurance. Of course, gap insurance falls squarely within the clauses we are now looking at. The Minister referred to the Jamison Committee of Inquiry into the Efficiency and Administration of Hospitals. In his second reading speech he said : In line with the recommendations of the 1980 Jamison Commission of Inquiry . . . appointed by the previous Government we will be legislating to prevent both private health funds and general insurers from offering cover for the 'gap' between the Medicare benefit and the schedule fee. The reason for this is quite simple and practical. As the AMA stated in evidence to the Jamison Inquiry: Doctors generally believe that there should be a charge at the point of service . I pointed out in my speech during the second reading debate that if the Minister is successful in getting doctors to bulk bill there will not be any charge at the point of service. Is not the intent to get bulk billing quite inconsistent with the rationale that was put forward in the Minister's second reading speech in regard to clause 57 where the Minister said that if people took out insurance they would be no better off? Does the Minister not overlook the fact that insurance can be obtained on a variety of terms, and one of the terms could very well be that the premium one would pay would be very much less than what one would otherwise have to pay out to one's doctor? Why is it that people are not to be allowed to insure, if they want to, against the contingency of having to meet payments which will not be met under the scheme? I would be indebted to the Minister if he could answer those questions. Dr EVERINGHAM(Capricornia)(1.30 a.m.) —My colleague the honourable member for Burke (Dr Theophanous), who sits on this side of the House, has just pointed out that when one provides medical insurance, medical benefits and hospital benefits one is not conscripting or socialising anybody. The power given to this Parliament under the provisions of the Constitution which enables it to monopolise health insurance was given to it by a referendum of the Australian people, and was backed by the Australian Medical Association and the Menzies Government; that is, the power to provide health benefits and health services to the Australian people. It is the same sort of power which the Tasmanian Government sought when it wanted to monopolise energy production in Tasmania. It is the same sort of power that governments use when they want to monopolise any service that they consider should be monopolised in the public interest, whether it be services in relation to railways, Qantas Airways Ltd, the hydro power authority in Tasmania or the Snowy Mountains scheme. There are plenty of examples of public monopolies in the public interest. Governments of both colours have seen the wisdom of monopolising such things. In fact, when Sir Earle Page brought in the original pre-Medibank subsidy for private fee for service practice he did not say: 'We had better allow people to have 100 per cent cover'. He said the opposite to that. He said that a moiety should be provided by the patient. The clause we are debating provides for that. The patient will provide some of the cost of his health care. Sir Earle Page said that we should be helping those who help themselves, which is going a lot further than we do. The honourable member for Denison (Mr Hodgman) seems to think that he can take this matter to the High Court of Australia and have it thrown out. I can assure him that it will not work that way. The beauty of this system is that it preserves the right of every doctor to charge the patient any moiety he likes. He can charge the patient nothing above the benefit so that the patient pays no moiety at all or he can charge the standard fee which will be met by the Government in cases of hardship. In the case of the person who is up for $150 a year of gap or the patient moiety, that cost will be met by the Government. But if the doctor envisages that that is not enough of a deterrent- the 15 per cent gap-the doctor can charge patients above the standard fee. Even when gap insurance was widespread in this country doctors were doing that because they did not believe in their services being free of charge at the point of service. There is no way that this legislation is introducing any new principle. There is no way that it is introducing any principle that has not been argued for by the AMA and other medical interests. In fact, the medical organisations which have most condemned and opposed Medibank and Medicare have argued for this very principle-that one should not cover 100 per cent of fees. This proposition was put to the Australian people at election time. They have given us a mandate. Nothing in the post-war history of Federal Parliament has been so acclaimed as the Medibank scheme and now Medicare. Another interjection from the honourable member for Denison suggested that people will regret it and that they will have to pay for their unwisdom. Mr Spender —They will find out it is not free. Dr EVERINGHAM —Of course, nothing is free, but there are things that are free of charge at the point of service. Opposition members should talk to their colleagues in Queensland who run what they call a free hospital system. Of course, there is no free lunch. Of course somebody pays for it. But it is free of charge, free of fee, at the point of service. That is what is meant. That is all that is meant by the term 'free hospitals'. It does not mean that it drops from the sky like manna from heaven. No sensible person suggests that it does. I wish that that sort of inane comment would be dropped from the debate. There are many ways in which Medicare will improve on the Earle Page concept of medical insurance and the five steps towards restoring the Earle Page scheme which occurred in seven years of Fraser Government. In that period, the then Government gradually eroded almost everything that Medibank had provided to the Australian people except the cover for pensioners which we brought in. The Earle Page cover for pensioners was about two-thirds of the standard fee. Most doctors joined that scheme and agreed to treat patients for that concessional payment. They then objected to the liberalisation of eligibility for pensions when the tapered means test came in. So a limit was put on the amount that a pensioner could earn and still get medical benefits. Under the Liberal Government, before Medibank, those patients who were eligible for pensioner medical services without means tests were allowed free services under that scheme only if the service was provided by a general practitioner and if the service was either a consultation or a visit. If the doctor was treating a fracture, giving an anaesthetic or performing an operation, there was no medical cover for the pensioners for that specialised care by general practitioners or specialists. Medibank gave pensioners the same benefits as insured patients. It gave them entry to medical services on the same basis as the rest of the community. We are carrying that a little step further and asking the doctors to put everybody on the same basis as pensioners. The doctors will earn a reasonable return. If they want to charge a patient extra, they may do so. It is up to the doctor and the patient to arrive at a private practice free enterprise agreement on what the fee involved will be. That is free enterprise. Nothing in this system will stop that happening. But the Federal Government has been given the power by referendum by the Australian people. This Government has been given a mandate to implement its Medicare policies and to do what we are doing tonight, that is, to provide a monopoly of public service to apply to every Australian just as we have a monopoly on age pensions, on State railways and on all kinds- Mr Howard —Telecom. Dr EVERINGHAM —Yes, Telecom and Australia Post. Mr Howard —And some of you would like a monopoly on education for the States, wouldn't you? Dr EVERINGHAM —We have done more for the private education sector than our predecessors. Private schools were better off during the Whitlam years with the money we gave them when there was an education crisis in this country. The major complaint of the private and public schools was that Liberal-National Party governments had let them run down. We restored decent funding to them. We have done it again in the Budget this year. Mr HODGMAN(Denison)(1.40 a.m.) —My remarks in response to the two doctors, the honourable member for Burke (Dr Theophanous) and the honourable member for Capricornia (Dr Everingham), will be short and to the point. I remind them that this is Canberra, it is not Moscow, and I ask them to look at proposed section 126, as it will be if this clause is passed. Mr Cunningham —Mr Deputy Chairman, I raise a point of order. The honourable member is reflecting on other members of the House by referring to issues in Moscow when we are dealing with a Medicare Bill. I ask you to bring him back to the clause of the Bill we are discussing. The DEPUTY CHAIRMAN(Mr Rocher) —Order! I ask the honourable member for Denison to address himself to clause 57, which, in general terms, deals with prohibition of medical insurance. Mr HODGMAN —Thank you for that ruling, Mr Deputy Chairman. Both honourable members denied, by implication, although I must say in fairness that the honourable member for Burke was slightly more frank, that this is a socialist measure. The honourable member for Capricornia has said that it is a monopolistic measure but it is not a socialist measure; it is not a nationalisation measure. I ask the Minister for Health-I doubt very much whether he will tell us-under what constitutional head of power he claims the right to bring in this legislation? I draw to the Minister's attention what to a lawyer would have to be one of the most extraordinary provisions ever written into any Bill brought through this Parliament. I refer specifically to proposed section 126 (6), in which the Government has the audacity to tell the High Court of Australia: In this section, 'insurance' means insurance to which paragraph 51 (xiv) of the Constitution is applicable. Let me tell the Minister that the High Court of Australia will make up its mind whether or not that is so. If it does apply and if the Minister is relying on section 51 (xiv), will he tell me what he will do in relation to State insurance and State insurance extending beyond the limit of the States concerned? Section 51 (xiv), whether the Minister has looked at it or not, does not just say ' insurance'. It states: Insurance, other than State insurance; also State insurance extending beyond the limits of the States concerned: Mr Groom —Is it section 29? Mr HODGMAN —As the honourable member for Braddon points out, it is not an exclusive power. The next question I ask the Minister is this: Why did he not base his legislation on section 51 (xxiiia), which is the section to which the honourable member for Capricornia referred? It was introduced in 1946 but the Minister has not based the legislation on that section. Thirdly, I read into Hansard a clause which will go down in history as one of the most insane pieces of legislation ever brought in by any government in the Western world. Proposed new section 126 (2) states: Where there is a contract of insurance (whether made before or after the commencement of this section)-- So it is retrospective, which of course we have come to expect from a socialist government- under which the insurer is liable to indemnify a person in respect of loss arising out of the incurring by that person of liability to pay medical expenses in respect of the rendering in Australia of a professional service-- Honourable members should listen to this- there is an implied condition in the contract that the insurer is not liable . . . The Government has legislated that black is white. It makes a nonsense of the statute. It is so committed to its socialist ideology that it is prepared to put a nonsense like this into the laws of Australia. Lastly, I ask the Government to look at proposed new section 126 (3), which states: ''(3) Where- . . . . (b) a contract of insurance contains a term that purports to substitute, or has the effect of substituting provisions of the law of some other country or of a State or Territory for all or any of the provisions of this section, this section applies to the contract notwithstanding that term. What does that mean? It means that the Government uses section 109 of the Constitution to override and trample on every single piece of State and Territory legislation currently on the statute books in this country. The Government is not merely socialist, it is centralist, and it is condemned because what it is doing is wrong. Tonight the Government has the numbers, but on the Federal election day, when it is next forced to the people, it will wish to hell that it had never brought in this wretched, rotten, socialist legislation. Question put: That the clause be agreed to. The Committee divided. (The Deputy Chairman-Mr A. C. Rocher) Ayes . . . . . . . . . . . 64 Noes . . . . . . . . . . . 38 —— Majority . . . . . . . . . 26 —— Baldwin, P. J. Hurford, C. J.Beddall, D. P. Johnson, LesBilney, G. N. Jones, BarryBlanchard, C. A. Keating, P. J.Blewett, N. Kent, L.Bowen, Lionel Keogh, L. J.Brown, John Klugman, R. E.Brown, Robert Lindsay, E. J.Brumby, J. M. McHugh, J.Campbell, G. McLeay, LeoCharles, D. E. Maher, M. J.Charlesworth, R. I. Mayer, H.Chynoweth, R. L. Mildren, J. B.Cohen, B. Milton, P.Cross, M. D. Morris, AllanCunningham, B. T. (Teller) Morris, PeterDarling, E. E. Morrison, W. L.Duffy, M. J. Mountford, J. G.Edwards, Ronald O'Neil, L. R. T.Everingham, D. N. Punch, G. F.Fatin, W. F. Saunderson, J.Free, R. V. Scholes, G. G. D.Fry, K. L. Scott, J. L.Gayler, J. Simmons, D. W.Gear, G. Snow, J. H.Griffiths, A. G. Staples, P. R.Hand, G. L. Steedman, A. P.Hayden, W. G. Theophanous, A. C.Holding, A. C. Uren, T.Hollis, C. Wells, D. McMHowe, B. L. West, S. J.Humphreys, B. C. (Teller) Young, M. J. Aldred, K. J. Hunt, R. J. D.Andrew, J. N. Katter, R. C.Anthony, J. D. Lloyd, B.Braithwaite, R. A. McGauran, P. J.Cadman, A. G. MacKellar, M. J. R.Cameron, Ewen (Teller) McVeigh, D. T.Carlton, J. J. Macphee, I. M.Coleman, W. P. Millar, P. C.Connolly, D. M. Moore, J. C.Dobie, J. D. M. Newman, K. E.Drummond, P. H. Porter, J. R.Edwards, Harry Robinson, IanFisher, P. S. Ruddock, P. M.Groom, R. J. Shipton, R. F.Hall, Steele Sinclair, I. McC.Hawker, D. P. M. Spender, J. M.Hicks, N. J. (Teller) Street, A. A.Hodgman, W. M. White, P. N. D.Howard, J. W. Wilson, I. B. C. Reeves, J. E. Fife, W. C.Dawkins, J. S. Lusher, S. A.Jacobi, R. Cowan, D. B.Child, J. Goodluck, B. J.Beazley, K. C. Tuckey, C. W. Question so resolved in the affirmative. Clauses 58 to 63-by leave-taken together, and agreed to. Clause 64 (Insertion of new Schedule 2). Mr CARLTON(Mackellar)(1.53 a.m.) —Clause 64 of the Health Legislation Amendment Bill seeks to insert a new Schedule containing the heads of agreement for the State governments that the Federal Government wishes to enter into in order to bring about the new Medicare arrangements. The particular concern we have about this proposed Schedule 2, which is attached to the Bill, relates to paragraph (3 ) in the explanatory memorandum, which states that the agreement is to: . . . provide for payments by the Commonwealth to the State for the purposes of reimbursing the States for losses incurred from the removal of all in-patient and out-patient fees for people who elect to be treated without charge as public patients in recognized hospitals, for losses incurred from a reduction in fees for private patients in recognized hospitals and for health expenditure other than hospital services; Our concern about this clause is that it embodies the principle that people will be allowed to partake of in-patient or out-patient services without any charge and regardless of their means. That is one of the principles of this Bill to which we are opposed. I made it clear in my speech in the second reading debate that the Opposition cannot live with measures which provide so-called free out-patient services and free in- patient services without any regard to the means of patients. Therefore we are opposed to this clause. Mr NEWMAN(Bass)(1.56 a.m.) —I would like to pick up the same provision which the honourable member for Mackellar (Mr Carlton) has been referring to. One thing which I think does cause great concern is that this provision will encourage more people to go to public hospitals to get treatment. It is not just a matter of people seeking out-patient treatment with a doctor in preference to their general practitioner; it is the strains that may be caused by people also seeking out other services of the hospital, which could be physiology, physiotherapy, x-ray, speech therapy or voice therapy-a whole range of provisions which a hospital can provide. Perhaps the one which could cause more concern is the question of pharmaceuticals. As I understand it, patients who go to a hospital for treatment from a doctor would then also be able to go to the pharmacy at the hospital and be provided with the drugs, medicines and so on prescribed for their treatment. This, of course will be very attractive to patients. It means that they will be able to avoid any cost of pharmaceuticals which at a minimum would be I think, the $4 prescribing fee that they would have to pay if they went to a normal pharmacy. So I ask the Minister for Health whether in this case he has taken into consideration the fact that there will now be a range of services used in hospitals but particularly this question of pharmaceuticals. If it is correct that people can receive their pharmaceuticals free, I would suggest to the Minister that the question of costs would loom very much in his mind. The second issue, which is perhaps a more parochial one, is the question of the ability of hospitals to cope with any shift that may occur with people who normally go to their own doctors, going to out-patient clinics. I refer to the Launceston General Hospital. The Minister would well know that that hospital is in a state of inefficiency. It has proceeded to stage 1 and because of the way that it has been constructed it is now uneconomic. It simply does not work efficiently. There is a requirement for stage 2 to be completed. This is very much bound up in this new scheme because the Government has been approached by the State of Tasmania to resolve this issue. Unless it is resolved this is one public hospital that will not be in a position to cope with the new services that it is going to have to provide under this scheme. Those are the two points I raise with the Minister: Firstly, the matter of pharmaceuticals and secondly, the resolution of the Launceston General Hospital stage 2 construction. Dr BLEWETT(Bonython-Minister for Health)(1.59 a.m.) —I have two points to make in relation to the issues that have been raised concerning this clause. The honourable member for Mackellar (Mr Carlton) said it was terrible that people would be able to go to public hospitals free of charge. They will not pay any charge at the point of service but they will all pay levies, and those levies are related to their incomes. Therefore it is not a service provided irrespective of people's means, because those on higher means will be paying a higher levy. In relation to the one question that is answerable at this stage from the honourable member for Bass (Mr Newman) concerning pharmaceuticals, it was one of the points of understanding with the various Ministers that those States-I believe this included Tasmania-which wished to make charges for pharmaceuticals would be free to do so in their public hospital systems. Clause agreed to. Clauses 66 and 67-by leave-taken together. Mr MACPHEE(Balaclava)(2.00 a.m.) —I would like to draw the attention of the Committee to the employment implications of the introduction of Medicare through these provisions in particular. Currently 8,500 Australians are employed by private health insurance funds. Yet at a stroke 60 per cent of these jobs-5,000 jobs-will be lost when the Medicare take-over is effected in February next year. These 5,000 people will be dismissed. The offer of the Minister for Health to take on up to 3,000 of them in Medicare is meaningless. The real figure will be more likely to be 2,500 at best and, because of relocation problems and other requirements, few of those 2,500 will be able to take up those positions. The Minister's own admission that there will be a net loss of at least 2,000 jobs is a sad reflection on the Government's priorities, particularly in view of the Government's own admission that its support of full wage indexation from 1 January this year will cause increased unemployment. What happened to the cry of 'jobs, jobs, jobs' at the National Economic Summit Conference that was held in this chamber in April this year? Voluntary health insurance funds have offered to carry out Medicare basic insurance cover under contract at favourable rates using existing equipment and staff. Such an arrangement would aim at preserving the 5,000 jobs now at risk and would enable one-stop shopping for health care. Under an extraordinary proposal Medibank Private will not be allowed to sign up new customers for supplementary health care insurance after 31 January. Medibank Private will not be allowed to locate in the new Medicare offices. The Minister' s response was to let a contract for $14m worth of extra computer equipment to take over the jobs of those 5,000 employees currently working for the private health funds. There is no justification for the Minister's claim that the centralisation of Medicare's basic insurance business is an essential ingredient of the scheme. That is ideology, not efficiency. We do not expect this Government to keep its ceiling on new Medibank Private business. Private fund employees will be further threatened by Medibank's ability to poach supplementary insurance from the private funds. It is important to note that on 5 August, as justification for Medicare, the Minister said: . . . it is an intrinsic part of the Prices and Incomes Accord between the Government and the ACTU. In fact, the Government is sacrificing the employees of private health funds on the altar of what is now regarded as a discredited accord. This is indeed ironic because the accord itself, as implemented through the Budget, with its commitment to wage indexation, envisages an increase in unemployment this year. The Minister says that those who are displaced through Medicare should be handled compassionately. What is the use of that? What is the comfort of that? The compassion which the Government should be showing should be in the form of providing jobs. This the Government has consistently failed to do since it was elected in March this year. Indeed, it has created the grand total of 100 new jobs, seasonally adjusted, since it took office six months ago. It has only 499, 900 to go. The communique from the National Economic Summit Conference states: The unions reaffirm their commitment that they will accept an offset in wage increases on account of the health insurance scheme. What comfort will that be to the 5,000 Australians and their families who end up with no jobs and no incomes as a result of this scheme? In any event, the 2.6 per cent reduction in the consumer price index which the Government estimates will result from Medicare is well on the way to being won in the field by the building industry unions and others. Where do the private hospitals stand, aware that the Government has been stifling debate by keeping private hospitals in the dark as to how they will fit into the system? It is clear that such hospitals will be disrupted. What is the Minister's forecast about the effect of Medicare on their bed occupancy? In any event, this is an ideological approach to the problem and a great tragedy for the people who are unemployed. Finally, honourable members should also consider that as if it was not enough for some people to be caused to be sacked, those who remain in jobs will have to recognise that although they have been told they will enjoy wage indexation in accordance with the accord, the Government is gleeful that, as a result of the introduction of Medicare, the March quarter of next year will have a negligible impact on the consumer price index. That is an easy quarter to index. However, the cost of health care will not have been reduced. Indeed, as the honourable member for Mackellar (Mr Carlton) observed earlier, the items which have been regarded as health care costs and are currently reflected in the consumer price index will now be an important part of the tax burden. This provision, like the others which my colleagues have condemned, will worsen the situation of so many thousands of Australian families. Mr SHIPTON(Higgins)(2.07 a.m.) —I refer to the situation of chemists, those important small business people in the medical care area, their relationship with the new Health Insurance Commission and the financial situation in which they will find themselves. I refer particularly to those chemists who will, as a result of this legislation, no longer be agents for the health funds. They will be hit hard. At present chemists receive an annual commission from health funds. I cannot say accurately what commissions they have received on average but I guess that they would have received, across the country, of the order of $4,000. Mr Mountford —Sit down then. Mr SHIPTON —I am making an intelligent guess. Commissions would range from $1, 000 to $9,000. These commissions, a fact which Government supporters would fail to understand, represent a fair percentage of net profit for chemists throughout Australia. Government supporters should go to the chemists in their electorate and ask them because then they might learn something. After Medicare has been introduced, those who have had their agencies taken away from them will be placed in difficult and stringent financial circumstances. Those who still have a Medicare agency will find that their commissions have been halved. Some chemists-Government supporters obviously do not understand this-specifically employ people to write new business for health funds or to renew customers' medical benefits insurance. As a result of this legislation, chemists will be forced to re-assess their staff needs, to retrench and to terminate. The Minister for Communications (Mr Duffy) who is interjecting does not care about the people in Dandenong who will be put out of work. He will stand condemned in Dandenong because chemists will be forced to retrench, terminate and convert permanent staff to part time staff. A number of chemists will be faced with cash flow problems. Their businesses will be adversely affected by this legislation. The situation in Victoria at present is that the State's private funds ask for payment of premiums at the end of the following month. Medibank's practice is to operate seven days in arrears. I ask the Minister to tell the House the system that is proposed under Medicare because if it is the same as that under Medibank it will impose severe cash flow restrictions on chemists who have Medicare agencies. As a result of this legislation chemists will close. Many will be marginally hit. Many jobs will be lost. I am not being alarmist when I say that in addition to the people that the honourable member for Balaclava (Mr Macphee) says will be thrown out of work by this legislation- Mr Griffiths —You are putting all your colleagues to sleep. Mr SHIPTON —The honourable member should just listen. He does not care about 1, 500 to 2,000 jobs in chemists' shops that will be lost throughout Australia as a result of this legislation. Government supporters are all looking stunned because they have not thought of this implication of the legislation. Mr Morris —Stand up straight when you speak. Mr SHIPTON —The Minister does not care. I cannot even see him over the Treasury boxes. The DEPUTY CHAIRMAN(Mr Rocher) —Order! The honourable member for Higgins will address his remarks through the Chair. Mr SHIPTON —I am sorry, Mr Deputy Chairman, I was intimidated by the Minister for Transport (Mr Peter Morris). The Government does not care. The Minister for Transport does not care about the chemists. He does not care about the small businesses in Newcastle, the small businesses in Australia, those owner-operated businesses providing an important professional health care service to customers. Question put: That the clauses be agreed to. The Commitee divided. (The Deputy Chairman-Mr A. C. Rocher) Ayes 64 Noes 36 -- Majority 28 -- AYES Baldwin, P.J. Hurford, C. J. Beddall, D. P. Johnson, Les Bilney, G. N. Jones, Barry Blanchard, C. A. Keating, P. J. Blewett, N. Kent, L. Bowen, Lionel Keogh, L. J. Brown, John Klugman, R. E. Brown, Robert Lindsay, E. J. Brumby, J. M. McHugh, J. Campbell, G. McLeay, Leo Charles, D. E. Maher, M. J. Charlesworth, R. I. Mayer, H. Chynoweth, R. L. Mildren, J. B. Cohen, B. Milton, P. Cross, M. D. Morris, Alan Cunningham, B. T. (Teller) Morris, Peter Darling, E. E. Morrison, W. L. Duffy, M. J. Mountford, J. G. Edwards, Ronald O'Neil, L. R. T. Everingham, D. N. Punch, G. F. Fatin, W. F. Saunderson, J. Free, R. V. Scholes, G. G. D. Fry, K. L. Scott, J. L. Gayler, J. Simmons, D. W. Gear, G. Snow, J. H. Griffiths, A. G. Staples, P. R. Hand, G. L. Steedman, A. P. Hayden, W. G. Theophanous, A. C. Holding, A. C. Uren, T. Hollis, C. Wells, D. McM. Howe, B. L. Willis, R. Humphreys, B. C. (Teller) Young, M. J. NOES Aldred, K. J. Hunt, R. J. D. Andrew, J. N. Lloyd, B. Braithwaite, R. A. McGauran, P. J. Cadman, A. G. MacKellar, M. J. R. Cameron, Ewen (Teller) McVeigh, D. T. Carlton, J. J. Macphee, I. M. Coleman, W. P. Millar, P. C. Connelly, D. M. Moore, J. C. Dobie, J. M. D. Newman, K. E. Drummond, P. H. Porter, J. R. Edwards, Harry Robinson, Ian Fisher, P. S. Ruddock, P. M. Groom, R. J. Shipton, R. F. Hall, Steele Sinclair, I. McC. Hawker, D. P. M. Spender, J. M. Hicks, N. J. (Teller) Street, A. A. Hodgman, W. M. White, P. N. D. Howard, J. W. Wilson, I. B. C. PAIRS Reeves, J. E. Fife, W. C. Dawkins, J. J. Lusher, S. A. Jacobi, R. Cowan, D. B. Child, J. Goodluck, B. J. Beazley, K. C. Tuckey, C. W. Question so resolved in the affirmative. Clauses 68 to 70-by leave-taken together, and agreed to. Clause 71 (Prescribed functions). Mr CARLTON(Mackellar)(2.19 a.m.) —Clause 71 relates to the same principles as clauses 66 and 67. Clause 71 talks about the setting up of the Health Insurance Commission and provides that the Commission shall perform such functions in relation to health insurance as are prescribed by regulations. These functions would be in addition to the Medicare and Medibank Private functions. The amendment widens the range of additional functions that may be conferred on the Commission to include other matters relating to health. The clause also repeals regulation 3 of the Health Insurance Commission Regulations-the notorious regulation 3-which was promulgated during the recess and on which basis the Minister for Health proceeded to spend his $55m worth of taxpayers' money provided in the Supply Bill in May without proper parliamentary approval as to its use. The regulation was promulgated during the recess and was dealt with in the Senate only last week. This repeals the regulation but at the same time introduces clauses which bring about the same effect. We have exactly the same objections to clause 71 as we have to clauses 66 and 67. These have the same objective of centralising health insurance in the Commission, of giving the Minister very wide powers in this matter and giving the Commission the capacity to carry out a wide range of functions and, indeed, to extend the public sector even further. We are totally opposed to this clause, as we are to clauses 66 and 67. Mr CONNOLLY(Bradfield)(2.21 a.m.) —This clause gives exclusive rights for medical insurance to be the preserve of the Commonwealth. As a result, we will see the transfer from the private to the public sector of at least another $1.5 billion. We will see a further increase in the power of the Department of Health over medical activities of the various professional bodies in Australia as well as over the people. This legislation effectively removes the freedom of choice which Australian people have traditionally believed they had with regard to their health. What is worse, the estimates of the cost in bringing in the Medicare arrangements are obviously incorrect. For example, they obscure the real costs of health care. The one per cent levy will raise only $1 billion per annum. Dr Blewett —Mr Deputy Chairman, I raise a point of order. I was prepared to have a degree of tolerance, but the honourable member's statements bear no relationship whatsoever to the clause. Mr CONNOLLY —It does, because it is relevant to the responsibilty of the Commission. The DEPUTY CHAIRMAN(Mr Millar) —I will hear the honourable member a little further. I ask him to be relevant. Mr CONNOLLY —Thank you, Mr Deputy Chairman. The levy which has been applied falls far short of the fact that Federal and State expenditure is some $8 billion per year on health. Therefore, the Australian people have been given an unrealistic factor on which to make their decision. I say simply that the whole thing is a total subterfuge. Above all, it represents the classic example of double standards because of the significant loss of employment which will be caused as a result of the introduction of this legislation. Mr HODGMAN(Denison)(2.23 a.m.) —This is the most arrogant clause in the Health Legislation Amendment Bill because it provides for socialism by regulation. I completely support the remarks of the honourable member for Mackellar (Mr Carlton) that regulation 3 of the Health Insurance Commission regulations was a scandal. I submit that to socialise by regulation is indicative of the arrogance of the Government in proceeding to impose the Medicare scheme upon the people of Australia at a cost of $1.7 billion. The bank nationalisation legislation brought down the Chifley Government. This Medicare legislation will bring down the Hawke Government. Finally, Mr Deputy Chairman, I put it to you that this legislation is unconsititutional, as witnessed by the refusal of the Minister to tell the Parliament on what constitutional head of power under section 51 he bases this diabolical socialist scheme. Clause agreed to. Clauses 72 and 73-by leave-taken together, and agreed to. Clause 74 (Constitution of Commission). Mr CARLTON(Mackellar)(2.24 a.m.) —I draw the attention of the House to the fact that clause 74 enables the Minister to increase the size of the Health Insurance Commission to seven in addition to its Chairman and General Manager. This is consistent with the expansion of the public sector and is an expansion of the Commission itself. It is indicative of the trend of this legislation. Clause agreed to. Clauses 75 to 84-by leave-taken together, and agreed to. Clause 85. Mr CARLTON(Mackellar)(2.25 a.m.) —I draw the attention of the Committee to clause 85 which is concerned with the protection of the Medicare name and symbol and that it provides for the prohibition of the use of the name Medicare and its prescribed symbol by persons other than the Health Insurance Commission and possibly by certain other people already using the name. I am not sure that that is a proper provision to be in the Bill. I hope that if anybody else is currently using the name, quite legitimately, that adequate compensation will be available for such persons. Clause agreed to. Clauses 86 and 87-by leave-taken together, and agreed to. Clauses 88 to 131-by leave-taken together. Mr CARLTON(Mackellar)(2.26 a.m.) —These amendments to the National Health Act 1953 deal with the new provisions for the registered funds. They represent the miserable allowances that the Minister has allowed the funds to keep with 40 per cent of their remaining business after 60 per cent has been nationalised. There are a number of detailed provisions in the legislation which require clarification. There is certainly a need for the clarification of the diversification opportunities of these funds. I point out that the diversification opportunities which the Minister is graciously allowing the funds will not help except, perhaps, in the very long term to offset the severe employment losses that will be brought about by the nationalisation proceedings. It will take some time for funds to diversify into other areas. It is not easy to build up new business in new areas in this day and age. Certainly the business will not build up quickly enough to save the employees who will be sacked in February 1984. Clauses agreed to. Remainder of Bill-by leave-taken as a whole. Dr BLEWETT(Bonython-Minister for Health)(2.27 a.m.) —I have a further proposed amendment to delete paragraph (g) from Schedule 3 of the Health Legislation Amendment Bill 1983. The corresponding paragraph in the existing Schedule to the National Health Act 1953 is paragraph (h). I move: (2) Schedule 3, page 64, omit paragraph (g) of the proposed Schedule. The intention of that long-standing paragraph was to prevent a registered organisation from offering a so-called basic table that was a variant of the basic table as defined in the National Health Act. However, from 1 February 1984 , the new paragraph (g) is considered unsatisfactory in that it could be interpreted as preventing a registered organisation from offering a table of benefits for shared-ward accommodation in private hospitals that are higher than those that would be offered in the basic table, as defined in the Health Legislation Amendment Bill 1983. It is not the intention of the Government to prevent this. Each organisation that applies for registration as a health benefits fund from 1 February 1984 will be required to offer a basic table as defined in the Health Legislation Amendment Bill 1983 and that any tables offered shall comply with the community rating principle to which I referred in my second reading speech on the Health Legislation Amendment Bill 1983. The application of the community rating principle is seen by the Government as precluding the offering of deductible tables by registered health benefit funds. Amendment agreed to. Remainder of Bill, as amended, agreed to. Bill reported with amendments; report-by leave-adopted. Bill (on motion by Dr Blewett)-by leave-read a third time. Debate resumed from 6 September, on motion by Mr Hurford: That the Bill be now read a second time. Mr CARLTON(Mackellar)(2.31 a.m.) —The Opposition opposes this measure because it is an integral part of the measures we have been discussing and is the Bill necessary to raise the levy of one per cent which, as we pointed out, raises about $1 billion of the $1.7 billion extra taxation being raised by the Government in a full year to support additional government involvement in health care delivery. So, we are opposed to it. We will not vote against this Bill because it is a money Bill, but that is the only reason why we will not be voting against it. Question resolved in the affirmative. Bill read a second time. Leave granted for third reading to be moved forthwith. Bill (on motion by Dr Blewett) read a third time. Debate resumed from 6 September, on motion by Mr Hurford: That the Bill be now read a second time. Mr CARLTON(Mackellar)(2.32 a.m.) —This Bill again is part of the mechanism. We wish to discuss this Bill in a little more detail in Committee. Question resolved in the affirmative. Bill read a second time. The Bill. Dr BLEWETT(Bonython-Minister for Health)(2.34 a.m.) —I move: Clause 3, page 2, after proposed sub-section 251R (1), insert the following sub- section: '' '(1A) Where, during any period, a man and a woman have lived together as husband and wife on a bona fide domestic basis although they were not legally married to each other, this Part and any Act imposing levy have effect in relation to that period as if those persons were legally married to each other and neither of them was married to any other person.''. In the light of concerns expressed to the Government about the levy provisions not recognising de facto relationships for the purposes of the higher levy thresholds and the combined ceiling on the levy applicable to families, we have decided to move that the Income Tax Laws Amendment (Medicare Levy) Bill 1983 be amended to the effect that couples who have entered into a bona fide domestic de facto relationship would be treated in the same way for all levy purposes arising under this Bill and the associated Medicare Levy Bill 1983 as legally married couples. Where a person is legally married but is living apart from the other party to the marriage and is in fact living in a de facto domestic relationship with another, that person will be treated for levy purposes as being married only to the person with whom he or she is living. The effect of the amendment will be that the special levy arrangements that are to apply to Defence Force personnel and repatriation and social security beneficiaries will be operative in the same way for legally married and de facto married couples. I commend this amendment to the Committee. Mr WILSON(Sturt)(2.35 a.m.) —In relation to the amendment moved by the Minister for Health (Dr Blewett), I ask the Minister why the threshold level for a married couple has not been set at twice that for a single person. Furthermore, in view of the Minister's amendment to put de facto spouses in a similar position to legally married people, I wonder whether he could explain to the Committee whether they are placed in a similar position. What for example, is the situation of the application of the end of year date to a married couple when it appears that that date is not applied to de facto spouses? It would appear that in these circumstances de facto spouses may in some instances be advantaged compared with those who are legally married, and it may be that the reverse is true. I wonder therefore whether the Minister could provide me with information on those two questions. I should like to deal with some other aspects, but I would be pleased if the Minister could provide me with that information. Dr BLEWETT(Bonython-Minister for Health)(2.36 a.m.) —I can answer the first point made by the honourable member for Sturt (Mr Wilson). The thresholds have been based on those levels which apply for receipt of benefits under the pensioner benefits card and the health care card. That is why the threshold level for a married couple is not simply double that for a single person. I would have to check further on the other technical point the honourable member raised in relation to de facto couples. Mr WILSON(Sturt)(2.37 a.m.) —I also ask whether either a married couple or a de facto couple, given that the Minister for Health is trying to put them on an equal footing, are required to aggregate their income for the purposes of determining whether they are entitled to the rebate or whether they can fail to disclose in a two-income household that there are two incomes and thereby get the benefit of the two higher single thresholds. If that is the case, it may be that it is in that area that de facto spouses are in a considerably advantaged position. If both of them are earning admitted low incomes they would not be required to pay any levy because each of them could have an income of up to nearly $6,700 without being liable to pay the levy. If a married couple were required to aggregate their income, instead of getting the benefit of a levy- free threshold of $13,396, they would receive a levy-free threshold of only $11, 293. It seems to me that that would be totally unfair because it is very easy to prove in the case of a legally married couple that they are so legally married, but in the case of the de facto spouses it is very much a matter for them to establish that they are living together on a bona fide domestic basis in order to claim relief from the levy. I ask the Minister to deal with that point. Dr BLEWETT(Bonython-Minister for Health)(2.39 a.m.) —As far as I understand it, de facto and legally married couples are treated in the same way for all purposes. If one examines the detail of the Bill, the single threshold applies to all people. If it advantages married couples and de facto couples they may aggregate. Amendment agreed to. Mr WILSON(Sturt)(2.40 a.m.) —I want to raise with the Committee the implications of what I think people will come to know as the meditax rather than the medilevy. It is not really different from a tax except that some subterfuge has been used in order to give it the appearance of having a very much lower impact on average Australian families than in fact it really has. It is well accepted these days that levies and withdrawal mechanisms on pensions are very similar to marginal rates of tax. In determining their impact on families and on households it is quite proper to aggregate those sorts of withdrawal mechanisms and find out what the effect on the incentive is and what the impact on the marginal dollar is. One finds that the effect of this meditax is quite perverse. Although it is true that people are exempt from any levy up to the threshold which the Minister for Health said has been set on the basis of health care cards, the fact is that once the threshold is reached the taxpayer is not liable for an extra 1c in the dollar-it is not an increase in the standard tax rate from 30c to 31c-the taxpayer, be he or she a single taxpayer, or be they a married couple, is liable to pay a catch-up provision at a marginal rate of 20c in the dollar. When that is stacked on top of the standard tax we find that the marginal withdrawal rate for families on very low incomes is in fact 50c in the dollar. So a family or an individual with an income between $6,698 and $7,050 will pay tax at the marginal rate of 50c in the dollar, and a married couple with an income between $11,141 and $11,695 will pay tax over that range at a marginal rate of 50c in the dollar. A lot of public effort by the Government has gone into selling the concept that the marginal rate of Medicare tax is 1c in the dollar. That is also a deceit of the public because when the public thinks of a rate of tax it thinks of the rate in the dollar above the tax free threshold. We know that the standard rate of tax is currently 30c in the dollar. The effect of the meditax is to raise the rate in the dollar from 30c to 50c in the catch-up area. Over a large range of incomes the average rate of tax above the normal tax threshold is not 30c in the dollar plus 1c but, because of the catch-up effects applied in the collection of the meditax, much more. Many people will pay tax at a marginal rate in the dollar far in excess of 30c in the dollar. Let us take as an example a single person on an income of $11,293. At that level of income, in terms that the public and taxpayers understand, the marginal rate of tax being paid by the taxpayer-tax including the meditax and the standard rate of tax-is at the level of 32c in the dollar. In the case of a married couple, their income has to rise to $18,400 before the average marginal rate of tax, combined with the effect of the meditax and the standard rate of tax, falls to 32c in the dollar. Over the range from the tax threshold, once one comes into the catch-up area the marginal rate lifts to 50c in the dollar. But if one averages the marginal effect of the meditax and the standard rate tax, the average rate in the dollar, determined by the normally accepted method, is in excess of 32c in the dollar and falls to 32c in the dollar only when incomes of single people are $11,000 and of married couples are $18,402. The average taxpayer is not the only person prejudiced by the stackup of marginal withdrawal rates. We all know of what the Government has decided to do in relation to the aged. Many aged pensioners who are part pensioners will be adversely affected by the reintroduction of an assets test. The effect will be that they will lose 50c in the dollar of their real income or notional income. If it is real income, people who are part pensioners will lose 50c in the dollar as a result of the income test, they will lose 15c in the dollar as a result of the application of the 30c standard rate of tax and they will lose 10c in the dollar in the catchup area under the mediatax levy. As a result, the marginal withdrawal rate on age pensioners will be 75c in the dollar. For pensioners who are affected by the introduction of an assets test and who have assets that, for quite legitimate and proper reasons and not because they have been trying to dodge any obligations, are locked into low yielding investments-if, for example, those investments are yielding only 6 per cent-the marginal withdrawal rate as a result of the application of the means test on the capital value, the tax on the income that is actually received and the meditax levy in some instances will be well in excess of 90c in the dollar. So here is another way in which people with modest incomes and modest means will be adversely affected as a consequence of the aggregation of these means test levies and ordinary tax rates, all of which can properly be described and categorised as tax. I think it is proper in these circumstances that the deviousness of the Government should be identified, because the Government will trumpet the fact that the levy is only one cent in the dollar. For most people in the range of incomes into which most taxpayers and families fall the rate of tax they will be called upon to pay will represent an increase of 2c in the dollar. In some instances the rate of increase will be 20c in the dollar or more. That will mean that marginal tax rates of in excess of 50c in some cases and 75c in others will be paid by people who are at the lower end of the income scale. The other point I make relates to the way in which the meditax has been excluded from the State-local government formulas for the distribution of State revenues. The Minister has failed to assure this chamber of the proportion that the levy is to bear to the costs of Medicare. So States, and more particularly local government which is totally dependent upon a share of income tax, must necessarily feel gravely worried that next year when the real costs of Medicare are revealed, when the chickens come home to roost, the Government may well change the level of the levy, remove from the tax collections a cost and transfer it to the levy, and at the same time cheat local government and the States of revenue that they are now entitled to receive. I note that the Bill in its final clauses states that unless this Parliament shall otherwise determine the rate of one per cent shall apply in the financial year 1984-85. I wonder whether the Minister can assure the Committee that the Government will not propose to the Parliament that it should otherwise provide in the financial year 1984-85. If he cannot give that assurance it is a clear signal to local government and to the States that they should be very cautious as to the implications of the possible transfer of Medicare costs to the levy. The DEPUTY CHAIRMAN(Mr Millar) —Order! The honourable member's time has expired . Bill, as amended, agreed to. Bill reported with an amendment; report-by leave-adopted. Bill (on motion by Dr Blewett)-by leave-read a third time. Debate resumed from 6 September, on motion by Mr Hurford: That the Bill be now read a second time. Mr NEWMAN(Bass)(2.53 a.m.) —I think the States (Tax Sharing and Health Grants) Amendment Bill (No. 2) poses very serious problems for the Government. I remind the Minister for Health (Dr Blewett) that not only has it been the credo of the Government that a consensus would always be reached but also it was the Minister 's proud boast, as recently as Question Time two days ago, on the question of the introduction of Medicare that a great number of people had been consulted and all States were co-operating and in agreement with the Government. The purpose of this Bill is to change two aspects of the present funding arrangements which presently apply to the States of South Australia and Tasmania which are affected by the introduction of the Medicare scheme. The important part of the explanation given in the explanatory memorandum is this: In order to participate in the Medicare funding arrangements, South Australia and Tasmania have agreed to terminate their hospital cost-sharing agreements with the Commonwealth with effect from 1 February 1984. As I pointed out to the Minister earlier that simply is not the case. I give the Minister credit that somehow or other an error has occurred. I am sure that no Minister, particularly this one, would wish to bring forward a Bill on that proposition, knowing that in fact it simply was not true. There has been a breakdown somewhere between the Minister and his Department, I am sure. This disagreement by the State of Tasmania was, as I understand it, brought to the attention of the Minister on 16 August. Far from the understanding of the Minister that it was agreed at the Premiers Conference on 30 June and 1 July that this should happen, in fact Tasmania is very much at odds with the Federal Government on the proposition. As the Tasmanian Government has pointed out to the Federal Government, the Commonwealth has not put any specific proposals forward as to discontinuing the cost sharing agreement or quantifying the proposed amount of any financial grant to replace it. As a result, Tasmania has not been able to put to the Government its concerns, which cover quite a wide range of issues. I know that the Tasmanian Government has in mind such things as compensation for the nil growth policy adopted by the Commonwealth Government under the cost sharing agreement for several years. It would like to see that changed. Another concern is the need for the State to establish rheumatology, renal and other much needed services. Another very important fact which I have mentioned on several occasions in this debate is that the Commonwealth has shared the cost of building a new hospital at Launceston which is uneconomic, without adding a further stage, and which remains largely unoccupied. Mr McVeigh —They should do that straightaway. Mr NEWMAN —I think so. There is the generosity of the honourable member for Darling Downs at this early hour. I am sure that the Minister would probably reflect the same generosity. The unavailability of additional funding for the necessary staff and ongoing costs, the need to reorganise hospital bed provisions by reclassification of many existing beds and the need for computerised management information services to enable statistics to be provided to the Commonwealth are just some of the issues which apparently Tasmania wishes to discuss with the Minister before it could possibly reach an agreement which would terminate the present hospitals agreement. I remind the Minister that it is a clear proposition put by the Minister that he would not proceed in any of the Medicare arrangements without the co- operation of the States. I believe that, therefore, this Bill is simply unacceptable when we have one of the participants not in fact participating at all. Whilst the Opposition will vote against the Bill, I think the Minister should consider withdrawing this Bill now and not proceeding with it any further until the necessary negotiations are carried out with Tasmania and an agreement reached. I know that the State has said to the Commonwealth that it would wish these discussions to take place at Premier-Prime Minister level and that it is ready for officers to meet immediately to ensure that that happens quickly. The proposition that Tasmania has agreed to this Bill is quite patently untrue. Add to that the problems that have occurred with the State of Tasmania over the dam issue. None of us wish to reawaken the divisions that that caused. But I think that this could have a great deal of political significance in Tasmania if the Minister is going to ride rough-shod over the State this morning. I appeal to the Minister, not only for the sake of his credibility, not only for the sake of being able, at the end of the day, to say that he did achieve everything he wanted to do with co-operation, but in the absolutely necessary spirit which has been ennunciated by the Prime Minister (Mr Hawke) so many times in recent weeks of the Government maintaining a co-operative position with the States of Tasmania so that there will not be accusations again that he is riding over its wishes, the Bill should be withdrawn this morning. Mr CARLTON(Mackellar)(3.00 a.m.) —I do not want to delay the House, except to support the honourable member for Bass (Mr Newman) in what he has quite properly drawn to the attention of the House in relation to the agreement with Tasmania, which apparently not been obtained. The Minister for Health (Dr Blewett) is in a difficult position in bringing this Bill before the House without having obtained the agreement of the Tasmanian Government, as he had claimed. That is a very serious matter to be dealt with by the Minister. This Bill imposes conditions on the States receiving health grants. One such condition is that they will provide accommodation and treatment in public hospitals without charge to all Australian residents who do not elect to be treated as private patients. The Bill, therefore, includes a very important principle and as we have previously stated in debate on the Health Legislation Amendment Bill, we are opposed to that principle. If any members of the Government are concerned that we happen to be debating serious matters such as this at three o'clock in the morning, I remind them that the business of the House is in the hands of the Government. It should not be necessary for us to stay here until three o'clock in the morning in order to provide serious debate on a measure which the Minister claims is the most serious social reform measure of the Hawke Government. It was introduced into the House in a reasonable manner last week. We had no problems in meeting the debate this week. But I cannot understand why the Government has kept the House sitting to three o'clock in the morning in order to enable us to get through the discussion on this Bill. Mr Mountford —Because you wasted time. Mr CARLTON —We have every possible right, I remind the honourable member for Banks, to discuss this matter, which we regard just as seriously as the Government does. I have not been in the House for hours for my health. I have been here, I hope, to discuss the Bill satisfactorily. I think that the honourable members on the Government benches are letting the Minister down, because I am sure that he regards the Bill seriously, as we do, and we have wanted to discuss it. Perhaps the Government merely wishes to keep us talking on this non-broadcasting day so that the actual arguments will be confined to a smaller audience. That may be an objective of the Leader of the House (Mr Lionel Bowen). But if that is so, the Government business managers should say so. All I say, on behalf of the Opposition, is that we have seen it as our duty to oppose Bills which we believe are not in the public interest. We have seen it as our duty to spend the necessary hours in examining these measures thoroughly. They will be examined further, thoroughly, by the Opposition in the Senate. We regard it as disgraceful that we have been required to do this until three o'clock in the morning when it was perfectly possible to reconvene tomorrow, Thursday, and consider the Bill at reasonable length during reasonable hours. We protest very strongly at this mangement of the business of the House, and we protest very strongly, in particular, against the introduction of what the Government regards as one of its most important reform measures in such a high handed and ridiculous fashion. Dr BLEWETT(Bonython-Minister for Health)(3.04 a.m.) —First let me comment on the last remarks of the honourable member for Mackellar (Mr Carlton). Given the enormous amount of urgent business which the Government has to do, I think that we have behaved extremely generously in the time provided for the debate. We have made no effort to prevent a full debate taking place, even though it has had to run into the early hours of this morning. The honourable member should compare that with the number of health Bills that were pushed through this Parliament in his time in government. If he does that, he will find that this Government, despite the urgency of this legislation and a number of other pieces of legislation, has been extremely generous in the provision of time for debate. I refer now to the remarks of the honourable member for Bass (Mr Newman) who appears to act as the emissary providing a new shopping list for the Tasmanian Government in health matters. The reason there are some problems on this issue is that the Government, when it prepared this Bill, was clearly under the impression that the Tasmanian Government had abided by the decisions reached at the Premiers Conference. I just make two points in relation to that. First of all, speaking at the Premiers Conference, the Treasurer (Mr Keating) made it clear, and I quote him: I emphasise that the Commonwealth's attitude towards the amount of any additional borrowing programs it is prepared to support will also be heavily contingent on the States agreeing to the proposals for compensating the States for new health arrangements under Medicare on the basis put forward by the Minister for Health on 15 June 1983, subject to the changes which we will be later proposing at the Premiers Conference. So the whole borrowing program was based on an acceptance by the States of the health arrangements which were being put forward. Later at the Conference the following final communique was issued: The Heads of Government agreed on the revised proposals for Medicare as outlined by the Minister for Health at the Premiers Conference including the basis for compensation grants to each of the States as outlined by the Minister. So it was the Government's understanding, as a result of those agreements reached at the Premiers Conference in preparing this Bill, that the compensation payment provisions had been agreed to by each of the States. When we were aware that at least the Minister for Health in Tasmania did not share the same understanding on what had been decided at the Premiers Conference, we immediately offered officers to talk to the Tasmanian Health Minister and his departmental figures. That offer has not yet been taken up by the Tasmanian Government. Mr Newman —Mr Deputy Speaker, I raise a point of order. I really seek some indulgence on this matter. The Opposition has not taken this legislation to the Committee stage. I agreed with this course of action because we want to terminate debate on the legislation. Perhaps it would clarify the matter if I could incorporate in Hansard a letter from the Tasmanian Minister for Health to the Federal Minister for Health dated 16 August because what is contained in that letter does not match up with what the Minister has just said. It is clear that in the middle of last month the Tasmanian Government made an offer for its officers to meet with Commonwealth officers. The Minister is saying now that the situation is the other way around. Either he is being misled by his officers or he is misleading us. Mr DEPUTY SPEAKER(Hon. Les Johnson) —Order! I think- Mr Newman —Mr Deputy Speaker, I seek leave to have the letter incorporated in Hansard. The House will then be able to make its own judgment. I think it is terribly important to have the letter on the record. Mr DEPUTY SPEAKER —I think the honourable member is pressing the indulgence of the Chair. Leave granted. The letter read as follows- File No. 89/51 16 August 1983 Dr the Hon. Neal Blewett, M.P.,Minister for Health,Parliament House,Canberra,A.C .T. 2600. Dear Doctor Blewett, Introduction of Medicare I have noted the points raised in your letter of 28 July 1983, but I believe you have made a fundamental misinterpretation of Tasmania's position regarding the cessation of the Hospitals Cost-Sharing Agreement. I also believe that this error has occurred due to your assumption in reporting to the Premiers' Conference from the Special Health Ministers' Conference, that all States had agreed to the introduction of the Medicare arrangements, and that the two cost-shared States would move to the same arrangements as the other States. This assumption by yourself was, and still is, fundamentally incorrect. All that Tasmania has ever indicated has been a willingness to examine any proposals put forward for consideration, to discontinue the Cost-Sharing Agreement prior to its expiry date of 30 June 1985. Up to the present time, there has been no formal or specific proposal put forward by your Government to- (a) discontinue the Cost-Sharing Agreement; or (b) quantify the proposed amount of any financial grant to replace it. Rather, there has been general discussion on the options. Until such a proposal is received, preferably from the Prime Minister to the Premier, I do not see that Tasmania will be in a position to consider any such alternative arrangements, nor give a definite reply one way or the other. In considering any such proposal, Tasmania would be looking to the financial advantages that may be available from accepting a change in funding arrangements , and not just to maintaining the 'status quo'. I would have in mind such things as compensation for the 'nil growth' policy adopted by the Commonwealth Government under the Cost-Sharing Agreement for several years; the need for the State to establish Rheumatology, Renal and other much needed services; the fact that the Commonwealth has shared the cost of building a new hospital at Launceston which is uneconomic without adding a further stage, and which remains largely unoccupied due to the unavailability of additional funding for the necessary staff and ongoing cost, the need to reorganise hospital bed provision by reclassification of many existing beds; the need for computerised management information services to enable statistics to be provided to the Commonwealth, etc. These are some of the matters that I would hope your Government would take into account in formulating a proposal for consideration by Tasmania to move away from the Cost-Sharing Agreement. I would be quite willing for our officers to meet to further discuss these matters and I believe that the State Standing Committee would be an appropriate forum to consider such proposals in detail, and it may even be necessary to arrange one or two special meetings to further any negotiations. However, I consider that the initiative for such a meeting should come from your Department in order that any required documentation can be specified. I also note that your Goverment is reviewing the arrangements for funding of the Community Health Program, which remains of concern to me, as previously mentioned. In conclusion, I would again confirm that Tasmania is looking to the Commonwealth Government to put forward a firm proposal for the Cost-Sharing Agreement to be discontinued, and for a specific indication of the actual amount of any grant that would replace it. Until such a proposal is received, then we can only assume that the Cost-Sharing Agreement will continue until its expiry date. Yours sincerely, JOHN CLEARY Minister for Health Question resolved in the affirmative. Bill read a second time. Message from the Governor-General recommending appropriation announced. Leave granted for third reading to be moved forthwith. Bill (on motion by Dr Blewett) read a third time. House adjourned at 3.09 a.m. (Thursday) The following notices were given: Mr Hurford to move- That, in accordance with the provisions of the Public Works Committee Act 1969, the following proposed work be referred to the Parliamentary Standing Committee on Public Works for consideration and report: Perth Airport International Terminal complex and parallel taxiway. Mr Hurford to move- That, in accordance with the provisions of the Public Works Committee Act 1969, the following proposed work be referred to the Parliamentary Standing Committee on Public Works for consideration and report: Australian Wheat Board accommodation at Ceres House, 528 Lonsdale Street, Melbourne, for Head Office and Victorian Branch. The following papers were deemed to have been presented on 14 September 1983 Defence Act- Determinations-1983- No. 15-Recreation Leave No. 16-Linguists Bounty No. 17-Fiji Living Allowance Navigation Act-Navigation (Orders) Regulations- 1983- No. 8-Marine Orders, Part 43 No. 9-Marine Orders, Part 44 Telecommunications Act-Australian Telecommunications Commission-By-Laws- Telecommunications (Charging Zones and Charging Districts)-Amendment No. 37 Telecommunications (Community Calls)-Amendment No. 30 Telecommunications (General)-Amendment No. 37 Telecommunications (Staff)-Amendment No. 42 The following answers to questions were circulated: Question No. 124 Dr Klugman asked the Minister for Finance, upon notice, on 11 May 1983: (1) How many relevant sales tax assessments have been issued by the Australian Taxation Office since allegations of widespread motor vehicle sales tax avoidance or evasion were made in the New South Wales Legislative Assembly by Mr M. R. Egan, M.P., on 23 and 28 September 1982. (2) What are the amounts of each of these assessments and to what periods do they relate. (3) What action is being taken to prevent companies involved being stripped of assets and to ensure payment of the assessed amounts. (4) In view of the comments by the Taxation Commissioner, Mr O'Reilly, that schemes referred to by Mr Egan were ineffective evasion schemes, what action has or is being taken to prosecute those involved. Mr Keating —The answer to the honourable member's question is as follows: (1) and (2) The Commissioner of Taxation has advised that since 23 September 1982, notices of assessment have issued to a further 21 wholesale companies involved in motor vehicle sales tax schemes. He supplied the following assessment details. Period of Sales tax assessment assessed Penalty $ $ 1 1.2.1981-31.5.1982 1,366,543 1,366,543 2 1.4.1980-30.9.1982 4,107,292 4,107,292 3 1.9.1980-31.3.1982 552,844 552,844 4 1.2.1981-30.4.1982 146,297 146,297 5 1.5.1982-16.9.1982 88,520 88,520 6 1.5.1980-30.11.1980 82,892 82,892 7 1.5.1982-25.5.1982 75,797 75,797 8 10.7.1979-7.11.1980 526,223 526,223 9 1.12.1981-15.9.1982 499,639 499,639 10 1.10.1979-31.12.1981 347,780 347,780 11 1.10.1979-31.5.1981 353,711 353,711 12 1.6.1980-30.11.1980 59,192 59,192 13 1.1.1981-31.3.1982 575,651 575,651 14 16.6.1980-4.12.1980 664,945 664,945 15 1.5.1979-31.12.1979 2,908,753 2,908,753 16 9.8.1979-24.9.1982 2,557,345 2,557,345 17 1.9.1979-30.9.1982 2,692,069 2,692,069 18 1.7.1980-30.9.1982 1,074,700 1,074,700 19 1.10.1979-30.11.1980 317,175 317,175 20 5.6.1980-20.7.1981 222,762 222,762 21 1.1.1982-28.1.1983 316,515 . . 19,536,645 19,220,130 The Commissioner has also explained that, in addition to these assessments, assessments have issued in 13 cases to the retail company associated with the wholesaler. (3) In broad terms, the Crimes (Taxation Offences) Act 1980, which came into operation on 4 December 1980, makes it a criminal offence for a person to enter into, or to aid or abet another person to enter into, any arrangement or transaction for the purpose of rendering a company unable to pay sales tax due or to become due. The penalty for an offence is imprisonment for up to five years or a fine of up to $50,000 or both. The Commissioner will be pursuing all avenues available to him to recover the tax assessed in scheme cases. Amongst other things, the sales tax law empowers the Commissioner (by notice in writing) to require payments to him by persons owing money to, or holding money on account of, a taxpayer. The Commissioner has served such notices on debtors (including banks) of numerous taxpayers who have participated in sales tax schemes. (4) The Commissioner confirmed that he does not concede that the schemes are effective under the existing sales tax legislation. Prosecution proceedings have already commenced against several persons implicated in sales tax schemes and other possible prosecution cases are presently under consideration. Question No. 146 Dr Klugman asked the Minister for Home Affairs and Environment, upon notice, on 17 May 1983: (1) What is the procedure for putting the Badgery's Creek-Luddenham area in the electoral division of Prospect on the World Heritage List. (2) Is it a fact that this area is one of the oldest in Australia. (3) Is it also a fact that there is no exact replica of the combination of the flora and fauna of this area anywhere else in Australia. (4) Will he arrange with the Minister for Finance for donations to the local anti-airport organisation to be tax-deductible, if channelled through the Australian Conservation Foundation. Mr Cohen —The answer to the honourable member's question is as follows: (1) It would be expected in the first instance that, if any area is so outstanding as to be considered for nomination to the World Heritage List, it would already be entered on the Register of the National Estate. As the Badgery' s Creek-Luddenham area is not in this category at present, a fully-documented nomination for the Register of the National Estate should be prepared for submission to the Australian Heritage Commission. Otherwise, the normal procedure to initiate a nomination for the World Heritage List would be for the Premier of New South Wales to request the Prime Minister to take the necessary action. (2) Yes, but that does not make it unique. (3) Yes. (4) Donations made to a local anti-airport organisation do not qualify for deduction in terms of the specific provisions of the income tax law relating to gifts. Gifts to the value of $2 upwards made to the Australian Conservation Foundation Incorporated are, however, allowable as deductions under the gift provisions of the income tax law. I am advised that should a gift be made to the Australian Conservation Foundation by a donor who expresses a preference that the gift be applied in a particular manner that is consistent with the objects of the Foundation, the gift would qualify for deduction provided that it was made in such a manner that the Foundation remained free to choose whether or not to apply the gift in accordance with the preference expressed by the donor. Question No. 167 Dr Everingham asked the Minister for Defence, upon notice, on 18 May 1983: Has the Government given a patrol boat to Indonesia as a defence measure; if so , how does this action accord with the federal policy of the political party of which he is a member. Mr Scholes —The answer to the honourable member's question is as follows: Under the Defence Co-operation Program a surplus RAN Attack Class patrol boat was provided to Indonesia on 6 May 1983, along with spares, training, and short term advisory assistance. This was part of an ongoing coastal surveillance project under which Australia has provided Nomad aircraft and patrol boats to assist in developing Indonesia's fisheries protection, anti-smuggling and search and rescue capabilities. The Government has announced its intention to enhance the generally good relationship that has been built up between Australia and Indonesia over a number of years. The Minister for Foreign Affairs visited Indonesia in April this year and held wide ranging discussions with Indonesian ministers. At the conclusion of the visit he announced that existing programs, projects and exchanges with Indonesia would be maintained, while aspects of the bilateral relationship were further explored with the objective of putting the relationship on a firmer, more creative footing. Question No. 174 Mr Blanchard asked the Treasurer, upon notice, on 19 May 1983: (1) Can the Minister say in which countries tax deductions are permitted for maintenance payments by divorced persons; if so, what amount is deductible in each country. (2) Has the Government considered a similar course of action. Mr Keating —The answer to the honourable member's question is as follows- (1) The Government is aware that some countries provide some form of taxation relief for maintenance payments by divorced persons. Such information as is held on this subject is, however, incomplete and it is not possible, therefore, to state with any accuracy the extent of the relief available. (2) No. Question No. 273 Mr Andrew asked the Treasurer, upon notice, on 26 May 1983: In view of the unprecedented fire damage experienced in South Australia, particularly in the Adelaide Hills, South East and Clare District, and the tax deductibility provision granted to donors to fire relief funds, will he consider making private donations for replacement Country Fire Service equipment or additional fire fighting equipment in fire ravaged areas also tax deductible? Mr Keating —The answer to the honourable member's question is as follows: Donations of $2 and upwards to Country Fire Services and Volunteer Fire Fighting Associations registered with the Director of Country Fire Services, South Australia, qualify as income tax deductions under the existing provisions of the income tax law. Question No. 329 Mr Burr asked the Minister for Transport, upon notice, on 23 August 1983: (1) Is there any substance in current media reports that the Australian National Line is negotiating with Shell Australia for the shipment of that company's coal from the mainland to Tasmania. (2) If so (a) is the movement being negotiated at (i) present or (ii) subsidised freight rates, (b) which vessels are to be used and (c) is the land movement of coal from Burnie wharf, Tasmania, to the storage area included in the rate to ship the coal. Mr Peter Morris —The answer to the honourable member's question is as follows: (1) No. (2) Not applicable.