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Issue #1639      May 21, 2014


Research Fund hoax

The government attempts to pit the billions of dollars in cuts and charges against medical research, by claiming the savings (including from co-payments) will be invested in a new Medical Research Future Fund. The Fund’s target is $20 billion with its interest income allocated to research programs. (Not the $20 billion just the interest for research.)

The relatively small amount that it would provide could be better taken out of general revenue as a progressive tax, but the government’s way will see average income earners and poor Australians who see the doctor most pay for the research fund with their co-payments.

Over three years medical research will get $276 million but almost $10 billion will be taken out of hospitals and from the sick through the co-payment in that same period.

The people, mostly those on low incomes, who are paying for the Fund, are hardly likely to afford the benefits of the research when they cannot afford a visit to the GP or their medications. This is simply a trick so that Abbott can destroy health care but not be accused of a broken promise not to cut health funding – he can still claim the research fund as a part of the health budget – even though he has slashed front line services for health care.

Thin edge of wedge

Governments make what sound like small incremental increases but which add up over time. This can be seen from the history of Pharmaceutical Benefits Scheme co-payments for age pensioners. Prior to 1990, scripts for pensioners were free. Then a fee of $2.50 was introduced which cut out after a threshold of $130 (52 scripts) was reached. Pensioners received a “pharmaceutical allowance” to cover 52 scripts to soften public opposition – no one would be worse off.”

But once the principle of free pharmaceuticals was breached, it was only a matter of time before the co-payment and threshold crept up in small annual increments, first under the Howard government then the Labor Rudd and Gillard governments. The pharmaceutical allowance did not keep up – it is only $3.10 a week, almost covering the cost of 27 scripts but the threshold after which they become free is 60 weeks. Pensioners who rely on four or more scripts a month are already $200 per annum worse off and the government is determined to widen the gap.

If the budget measures were passed the proposed Medicare and PBS increases could see pensioners out of pocket by close to $500 per annum before being eligible for free medical services and scripts.

The Medicare co-payment is set at $7 – as if it’s not much – but it will not remain at $7. And even so there is a high chance that GPs will simply now choose to charge the full AMA fee of $72. Australians’ rights to health care are being scrapped and patients will again become beggars in the GP waiting room, i.e. begging to be bulk billed. It is the thin edge of the wedge and spells the death of bulk billing and Medicare.

Likewise the government’s advice to state governments to introduce fees for “GP equivalent visits to emergency departments” is unworkable. It is the thin edge of the wedge for introducing fees for public patients in public hospitals.

The amount of the co-payment may not sound large to Treasurer Joe Hockey who compares it with a couple of middies of beer. But to an unemployed person who is about to spend six months with no income under the government’s vicious new legislation, or for a pensioner, a sole parent or family on low wages, it could prove beyond their means.

In addition to the attack on bulk billing and the PBS, mental, dental, Indigenous and a range of preventative health programs face defunding. National Partnership Agreements with the states also face the axe. States face an $80 billion shortfall in anticipated income over the next ten years and do not want to wear the unpopularity of pushing for an increase in the GST.

The main agenda is to cut costs, cut corporate taxes, raise the GST and privatise the public health system. The 2014-15 budget takes the first steps in the National Commission of Audit’s agenda for the complete privatisation and Americanisation of Australia’s health system. (See Guardian, “National Commission of Audit Report: Destruction of Medicare”, #1637, 07-05-2014) Written by the Business Council of Australia, its members, stand to be the main beneficiaries.

Next article – Abbott govt promotes climate change, rewards polluters

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