February 4 Edition
Here is some other of the recent other news and analysis.
Clearly the big news in the last few weeks has been macroeconomic. Last week we saw Japan decide to move to negative interest rates on some deposits in an attempt to force more economic activity. The markets saw this as good - but I fear it may be the opposite!
This week - we have seen a bit of a rally in markets - so what happens next week will be interesting.
Out of the blue we now see a bun-fight on health insurance costs. Will be fun to watch.
In OZ we are sort of stuck in a rut and seeking direction. With Parliament back all may (or may not) become clearer!
Here is a summary up until the end of last week (and zilch seems to have changed since up till the time of posting):
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General Budget Issues.
Tax reform: Morrison pours cold water on adding GST to health and education
Date January 24, 2016 - 7:23PM
James Massola
Political correspondent
Treasurer Scott Morrison has pledged Australians will be "winners" when the Turnbull government finally reveals its election-year tax reform package, while effectively ruling out imposing the GST on health or education.
In a pitch to households and the Liberals' core small business constituency, Mr Morrison said the government would seek a strong mandate for tax reforms that are likely to include changes which reduce personal and business tax rates to drive economic growth.
And in a sign the federal government will attempt to limit the scope of direct compensation paid to households arising from any tax changes, as recommended in modelling leaked to Fairfax Media last year, Mr Morrison pointed out the carbon tax compensation package put in place by Labor had been kept by the Coalition, despite the repeal of the tax, and therefore a "lag compensation" was already in the system.
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- Jan 24 2016 at 8:19 PM
- Updated Jan 24 2016 at 8:19 PM
Australia can't tax its way to surplus, Scott Morrison says
Scott Morrison has said Australia should aim for a "desirable" surplus. Andrew Meares
by Primrose Riordan
Treasurer Scott Morrison has warned against aiming for a surplus when spending is higher than a quarter of GDP, saying higher taxes is not a good way to fix the budget.
The Treasurer also said the government needed to get a firmer grip on new expenditure such as spends on infrastructure and security.
"We have to work harder on curtailing the new expenditure because ... there's been spends on infrastructure, increased security requirements, things like this – we have to get that under control," he told Sky News on Sunday.
The most recent budget update revealed the federal budget deficit has blown out by $26 billion over four years since May and the forecast return to balance has been pushed out by at least another year, to 2020-21 at the earliest.
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Tax reform: Economists urge Treasurer Scott Morrison to 'have guts'
By business reporter David Taylor
Posted
The Commonwealth Treasurer may be talking about keeping the tax debate open, but economists are calling on Scott Morrison to show some policy "guts" and get real about tax reform.
For a government undertaking a once-in-a-generation economic balancing act, tax reform is a daunting but necessary task.
However complicated it becomes, the Treasurer has it boiled down to just one catch phrase.
"How is the tax system actually stopping people who are actually out there backing themselves, achieving the goals they want to achieve?" Treasurer Scott Morrison said on Sky News yesterday.
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Morrison builds case for GST reform
- Paul Kelly
- 25 Jan, 12:05 PM
Scott Morrison has foreshadowed a likely ambitious election-year contest over the GST with his declaration that only a tax package with a major GST reform can deliver the government’s goal of a growth agenda with serious income tax relief.
Setting the benchmarks for the year, the Treasurer said yesterday he wanted a “strong mandate” at the election for a tax reform agenda. He said it was a “fantasy” to think increasing taxes on multinationals or other measures short of a GST package would deliver meaningful income tax and company tax cuts.
Interviewed on Sky News’s Australian Agenda program yesterday, Morrison gave the firmest sign so far that the Turnbull government will seek re-election on an ambitious agenda designed to lay the foundations for a long-run Coalition government.
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Treasury secretary John Fraser: Australia has a spending and a revenue problem
Date January 29, 2016 - 8:59AM
Gareth Hutchens
PM denies triple-A credit rating at risk
Malcolm Turnbull denies Australia's credit rating is at risk from debt, telling 3AW's Neil Mitchell rating agencies had already given the government's fiscal strategy "big ticks". Courtesy ABC News 24.
Treasury secretary John Fraser says it has been getting harder to forecast budget deficits and surpluses, and aggregates like GDP growth, as the global economy becomes more integrated.
He has also challenged the claim by Treasurer Scott Morrison that Australia does not have a revenue problem, saying successive falls in tax receipts have been the "main driver" of every budget downgrade since 2014.
Speaking publicly for the first time in 2016, Mr Fraser has set out the budgetary problems facing the Turnbull government this election year.
- Jan 28 2016 at 5:27 PM
- Updated Jan 28 2016 at 9:14 PM
Morrison already sweating MYEFO trade forecast
by Jacob Greber
Australia's terms of trade look to be falling faster than the government forecast in its budget update just six weeks ago, raising the spectre of multi-billion dollar write-downs in projected revenue that would make it even harder for Treasurer Scott Morrison to balance the budget.
Lower prices for iron ore, coal and liquefied natural gas accelerated a five-year-long plunge in the terms of trade in the December quarter.
The measure of Australia's export income, which is a crucial driver of the budget, is now about half its 2011 peak and at a decade-low. The terms of trade fell between 4.5 per cent and 5.2 per cent last quarter, according to estimates by four analysts based on Australian Bureau of Statistics trade data out on Thursday.
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Australia’s AAA credit rating not at risk says Scott Morrison
- The Australian
- January 29, 2016 12:58PM
Rosie Lewis
Scott Morrison says Australia’s prized AAA credit rating is not at risk, as he backed Treasury secretary John Fraser’s call to rein in government spending.
The nation’s top economic adviser last night warned the Turnbull government its credit rating would be in jeopardy unless urgent efforts were made to cut spending, raising the spectre of a federal interest bill of more than $2 billion a month within a decade.
In a landmark speech to the Sydney Institute, Mr Fraser sounded the alarm about Australia’s chronic fiscal malaise, arguing that weaker-than-expected revenues, falling commodity prices and forecasting errors were no excuse for not taking tough decisions about the nation’s budget deficit.
He called for further cuts to the government’s ballooning welfare bill and for spending promises to be offset with new savings. He also signalled that federal government spending of more than 25 per cent of national income was unacceptable.
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Business Day Economic Survey: budget outlook bleak but housing market will have soft landing
Date January 30, 2016 - 1:32AM
Gareth Hutchens and Peter Martin
BusinessDay survey points to major concern over China
The results of the annual BusinessDay financial survey paints a gloomy outlook with startling responses around China's reporting of growth rates.
Treasurer Scott Morrison faces a bleak economic outlook framing his first budget in May with leading economists warning of weakening growth and stagnant wages through the rest of 2016.
More than two dozen economists from leading banks and universities have warned that Australia will face below-trend economic growth this year, a further collapse in mining investment, and a lacklustre 12 months on the sharemarket.
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Health Budget Issues.
Cancer survivors slam Federal Government pathology cuts
January 26, 2016 12:00am
Moorabbin Kingston Leader
CANCER survivors say Federal Government plans to slash pathology funding will force the needy to choose between the crucial testing and comfortable living.
Government plans to slash bulk-billing incentive payments to pathologies — providing services such as pap smears and blood tests — from July saving $650 million over four years.
Ormond resident Jan Armstrong said an intense round of pathology in 2012, after her breast cancer diagnosis, uncovered kidney cancer.
“If I didn’t have those tests the kidney cancer wouldn’t have been found. It would have killed me,” she said. “I’d hate to see someone else go undiagnosed because of funding changes.”
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Hospital performance getting worse and now facing budgetary 'black hole', says AMA
Date January 28, 2016 - 1:31AM
Harriet Alexander
Health Reporter
The federal government is under pressure to reform taxes following a report card on public hospitals that shows the most urgent patients are waiting longer at the emergency departments, bed ratios are deteriorating and elective surgery waiting times are static.
The Australian Medical Association is using its annual report on the performance of public hospitals to call for an overhaul of health funding, which faces slower growth from July next year when new funding arrangements come into effect.
AMA president Brian Owler said hospitals would be insufficiently funded to meet the rising demand from 2017, when the states and territories were facing a "black hole".
A Treasury analysis found $57 billion would be removed from the health system over 10 years.
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Public hospitals face funding crisis warns AMA president Brian Owler
- AAP
- January 28, 2016 10:18AM
Australia’s already overstressed public hospitals are facing a funding crisis, doctors warn.
The Australian Medical Association says its latest hospitals report card points to an imminent crisis due to federal funding cuts.
“Things will get much worse in coming years unless the Commonwealth reverses its drastic cuts from recent budgets,” AMA president Professor Brian Owler said.
“The states and territories are facing a public hospital funding `black hole’ from 2017 when growth in federal funding slows to a trickle.” The report found 68 per cent of emergency department patients classified as urgent were seen within the recommended 30 minutes, while bed number ratios had deteriorated.
Elective surgery waiting times and treatment targets are largely unchanged.
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Public hospitals to be ‘biggest financial challenge’ faced by state governments
Just 68% of emergency department patients classified as urgent were seen within 30 minutes, a report from the Australian Medical Association says
Thursday 28 January 2016 06.16 AEDT Last modified on Thursday 28 January 2016 08.36 AEDT
As of next year public hospital funding will become the biggest financial challenge faced by state and territory governments, a report from the peak organisation representing doctors the Australian Medical Association, warns.
The annual assessment of the country’s public hospital system, launched by the association’s president Professor Brian Owler on Thursday, found many hospitals failed to meet key performance benchmarks for emergency department waiting and treatment times in 2014-15.
Only 68% of emergency department patients classified as urgent were seen within half an hour, a reduction of 12% from the previous year and well short of a performance target of 80%, the report found.
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28 Jan 2016 - 4:34pm
Funding crisis for public hospitals: AMA
The AMA is calling for the federal government to fix health funding in the next budget, saying Australia's public hospitals are facing a crisis.
Source: AAP
28 Jan 2016 - 7:56 AM UPDATED YESTERDAY 4:34 PM
Australia's already over-burdened public hospitals are facing an imminent funding crisis, doctors warn, as debate continues over increasing the GST.
"The states and territories are facing a public hospital funding `black hole' from 2017 when growth in federal funding slows to a trickle," said AMA president Professor Brian Owler.
"If we want people living their full life expectancy, if we want to see people living longer, being healthier out there in the community, we have to resource our healthcare system."
The AMA's latest public hospitals report has found that overall, performances were "virtually stagnant and even declining in key areas" despite improvements in previous years.
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MEDIA RELEASE
Friday, 29 January 2016
Wise budget should ensure health and wealth
As the Turnbull Government talks of the importance of innovation to all sectors of the economy, it is time to ask what of innovation in healthcare?
Released today, the Consumer’s Health Forum submission to the Federal Budget provides ideas on where we need to centre the debate: investments in prevention, primary health care, new ways of keeping pressure off hospitals and infrastructure that will drive a truly people-centred health system.
Instead of short-range strategies that see cuts in health as a federal debt-reduction strategy, we need a long-term health plan that looks at how we distribute and get better value out of our existing health dollar, as well as where we need to make wise investments in health as a nation, the Consumers Health Forum says.
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Health Insurance Issues.
- Jan 29 2016 at 5:27 PM
- Updated Jan 29 2016 at 5:27 PM
Turnbull government urges health funds to reduce premium increases
by Ben Potter
Health Minister Sussan Ley is urging private health funds to pare back premium increases in the $19 billion sector amid a pitched election year battle over health spending.
The federal health department emailed the funds on Friday asking them to resubmit claims for premium increases of about 6 per cent to take effect on April 1.
"The fact that they have come back and asked for a resubmission at this late stage makes the intention very clear," said Rachel David, chief executive of Private Healthcare Australia, the funds' lobby.
"They are seeking a discount on behalf of the consumer and we as an organisation understand that."
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Ley blocks health fund rises
Andrew Tillett
January 30, 2016, 12:45 am
The Turnbull Government is trying to minimise an election-year backlash from health fund members by ordering insurers en masse to scale back their requests for premium increases.
In an unprecedented move, Health Minister Sussan Ley yesterday told all 35 funds to resubmit their applications for premium rises — some of which would have been three times the inflation rate.
But the decision to reject all of the funds’ proposed increases risks opening a new front in her war with medical stakeholders after already getting doctors and pathologists offside.
WA’s main fund HBF criticised Ms Ley for her blanket approach, warning that forcing insurers to absorb rising health costs was unsustainable.
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Fee hikes crackdown on health insurers
- The Australian
- January 30, 2016 12:00AM
Sean Parnell
Private health funds have been ordered to open their books and justify their bid to increase premiums, in what the insurance industry last night described as an unprecedented departure from regulatory process.
In an effort to secure a better deal for members, Health Minister Sussan Ley yesterday wrote to insurers formally requesting they either seek a lesser premium increase or provide the financial statements to prove it was necessary to pass on higher costs.
Ms Ley’s intervention comes only a week before health funds have traditionally been notified of the outcome of the application process. Premiums normally increase on April 1.
Annual premium increases of about 6 per cent have prompted many members to claw back their level of cover to reduce costs, inevitably leading to an increase in complaints. Regulators and some industry figures fear the premium increases are unsustainable and last year convinced the government to consider major reforms to prevent members dumping their cover altogether and flocking to the public system.
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Sussan Ley orders private health insurers to justify their premium increases
Date January 30, 2016 - 9:37AM
Adam Gartrell
National Political Correspondent
The Turnbull government has ordered private health insurers to justify their planned premium increases in an effort to secure a better deal for consumers.
In what's being billed as an unprecedented intervention in the normal regulatory process, Health Minister Sussan Ley has written to all private insurers asking for "additional information" regarding possible premium increases this year.
"I have held increasing concerns the current process used to assess and approve premium increases does not allow government a rigorous assessment of an insurer's full financial position," Ms Ley said in a statement on Saturday.
The federal government holds a significant stake in the private health sector by providing about $6 billion in rebates every year, Ms Ley says.
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Health insurers defend premium increases
- AAP
- January 30, 2016 1:49PM
Private health insurers are warning the Turnbull government there are no short-term fixes towards achieving affordable healthcare.
Private Healthcare Australia, which represents the insurance industry, also defended premium increases, saying insurers are working to keep them as low as possible.
The comments from the group's chief executive, Dr Rachel David, came in response to an announcement by Health Minister Sussan Ley that she was stepping in to demand insurers justify their increase requests.
Ms Ley has asked all providers to resubmit an application for a lower premium increase or to provide evidence of extenuating circumstances.
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Pharmacy Issues.
Pharmacy under review
The Federal government’s controversial Review of Pharmacy Remuneration and Regulation has kicked off.
A number of industry sources have told Pharmacy News the review panel has commenced preliminary consultations with industry stakeholders.
A spokesperson for the Department of Health confirmed that the review "has commenced, including initial stakeholder meetings".
"The Review Panel is committed to consulting broadly to gain an extensive view of the pharmacy sector in Australia and the factors contributing to patient health outcomes and the quality use of medicines," the spoesperson said in a statement.
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Health is also clearly still under review as far as its budget is concerned with still a few reviews underway and some changes in key strategic directions. Lots to keep up with here with all the various pre-budget kites being flown! Enjoy.
David.
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