Budget Night was May 12, 2015.
Since then the selling has been at full throttle and we have all gradually come to grips with what it means for all sorts of groups.
We have seen the childcare package come under all sorts of criticism re ‘double-dipping’ and the like, some continuing cuts to health and a pension package that seems to have many loosers.
Changes to super have been scrapped and sorting out the relationship between super and the pension system is also off the table apparently. Not credible I believe.
Pharmacy has a lot going on and continuing news seems to come from the sector.
The first Budget Back Down happened a few days ago. We have to wonder how many more will follow.
Published: 17:43 EST, 21 May 2015 | Updated: 17:43 EST, 21 May 2015
Health Minister Sussan Ley has conceded the government won't get a $1 billion budget saving on subsidised medicines through parliament.
The 2014 budget measure - which the government stood by in its second budget released a week ago - raises the safety net for general patients by 10 per cent above CPI each year over four years.
The changes, which were originally earmarked to start in January this year, would have meant general patients pay $5 more in subsidised PBS prescriptions and concessional patients would pay 80 cents more.
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There is a lot more that may fall over:
Senators are threatening to veto $7 billion in savings in the budget as the federal government admitted defeat on last year’s $1.3bn plan to charge patients more for subsidised medicines.
An exclusive survey of crossbench, Labor and Greens senators reveals three new budget measures are set to fail despite the government’s attempt to retreat from some of the harsh policies it advocated one year ago.
The $3.5bn childcare package, removal of “double-dipping” for paid parental leave and one-month wait for the dole for young people would not pass the upper house in their current form, according to The Australian’s analysis.
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Here are the other articles I found helpful this week.
General Budget Issues.
Date May 18, 2015 - 12:15AM
John Menadue
Australia's capacity to tackle important public issues – such as climate change, growing inequality, tax avoidance, budget repair, an ageing population, lifting our productivity and our treatment of asylum seekers – is diminishing because of the power of vested interests, with their lobbying power to influence governments in a quite disproportionate way.
Lobbying has grown dramatically in recent years, particularly in Canberra. It now represents a serious corruption of good governance and the development of sound public policy.
In referring to the so-called public debate on climate change, Professor Ross Garnaut highlighted the "diabolical problem" that vested interests brought to bear. Ken Henry, a former secretary of Treasury, says he "can't remember a time in the last 25 years when the quality of public policy debate has been as bad as it is right now". He was followed as secretary of Treasury by Martin Parkinson, who has warned about "vested interests" who seek concessions from government at the expense of ordinary citizens. The former ACCC chairman, Graeme Samuel, has cautioned that "A new conga line of rent-seekers is lining up to take the place of those that have fallen out of favour". And in referring to opposition to company tax and carbon pollution reform policies, Fairfax columnist Ross Gittins says: "Industry lobby groups have become less inhibited in pressing private interests at the expense of the wider public interest. They are ferociously resistant to reform proposals."
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Date May 18, 2015 - 12:15AM
Senior columnist at The Age
Budget 2015: The aftermath
The economy can't be run efficiently with one foot on the budgetary brake and the other foot on the monetary accelerator – not without serious damage to the growth engine.
The Reserve Bank's recent decision to lower the cash rate to 2 per cent was a signal to the government that it believes the contraction in the economy is serious, that joblessness and no real wages growth will be with us for much longer than expected, that the bank is doing its job to aid recovery and, by implication, that the federal budget should be expansionary to support aggregate demand – the prime engine of economic growth.
Tight monetary policy, by restricting the money supply and forcing up interest rates, can halt spending. Easy money can finance asset and property bubbles – as is arguably the case now. But where consumer and business confidence is low, expecting easy monetary policy to instigate spending is like pushing on a string: it doesn't work in the absence of spending initiated by the private sector or the government.
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Australia’s overdependence on income and company tax to achieve a surplus has made any changes to GST, negative gearing and superannuation unlikely
Monday 18 May 2015 11.39 AEST Last modified on Monday 18 May 2015 11.51 AEST
Last week’s budget attempted to show a path back to surplus. But it is a questionable path based on spending cuts from last year that have not yet passed, cuts to state funding that have yet to be agreed and projected taxation where revenue returns would need to be at the levels of the Howard years.
The dependence upon strong taxation growth from income and company tax however also throws into question the government’s taxation review. Having already ruled out a number of changes to the tax system, the reliance on revenue growth means any changes to income and company taxes will almost certainly destroy chances of a return to surplus.
When Joe Hockey released the “Better Tax” discussion paper the rhetoric at first was that very much that everything was up for discussion. For example, unlike the ALP’s tax review conducted by then treasury secretary, Ken Henry, this review would consider GST.
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The government attempted to justify all their broken promises in the 2014 budget by relying on an overriding principle that these broken promises were necessary to return the budget to surplus.
But this year, there is a change of alibi. Gone are the dire warnings about Greece and the lectures about there being no alternatives to budget repair.
The implications of the moving reeds on which the Abbott government is based go further than the anger that the last election campaign from Tony Abbott and Joe Hockey was fundamentally dishonest.
It goes to the future. Anything Abbott and Hockey say between now and the next election is likely to be trashed after the election, should they win.
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Date May 22, 2015 - 9:14AM
Reporter
The number of Australians expected to be worse off in retirement is set to boom, with some facing a 10 per cent cut to their overall income following the government's proposed pension changes.
That is the argument of Industry Super Australia, which estimated middle income Australians would be dealt the heaviest blow - losing more than $100,000 over their retirement period if changes to the asset test get the green light. The Federal government is looking to tighten pension qualification tests in a move that has drawn criticism from across the superannuation industry.
Analysis by Rice Warner, which was engaged by ISA, found that the number of new retirees affected by the proposed changes will more than double from one in three retirees today, to around seven in 10 by 2055.
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Joe Hockey has ordered ministers to find alternative savings for budget measures that fail in the upper house after a surprise surrender on the government’s plan to add a $5 charge to subsidised medicines, amid signs the Senate will veto more reforms.
The Treasurer is insisting that the retreat on the medicine co-payment will not hurt the budget bottom line, setting a challenge for Health Minister Sussan Ley to find at least $1.3 billion in other savings within the health portfolio.
Patients are yet to be told where the alternative cuts will fall but appear likely to escape the increase in the Pharmaceutical Benefits Scheme co-payment announced last year, which is being shelved in the face of objections from crossbench senators.
Doubts hang over at least $7bn in other savings unveiled in this year’s budget, including a childcare package that is conditional on the approval of cuts to paid parental leave and family tax benefits.
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Date May 23, 2015 - 12:01AM
Nassim Khadem
EXCLUSIVE
By keeping most of the last year's budget cuts, and introducing new ones in the May budget, the Abbott government is stripping more than $15 billion over four years from families and lower-income Australians, new analysis by the Australian Council of Social Service shows.
The report, obtained by Fairfax Media, says most of the $800 million revenue increases projected over the next five years come from income tax bracket creep and projected economic growth.
The combined impact of the two budgets for low and middle income people was "devastating", ACOSS chief executive Cassandra Goldie said, with almost two thirds of the family payments cuts hitting low to middle-income households.
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Health Budget Issues.
- May 18 2015 at 5:01 PM
- Updated May 18 2015 at 8:58 PM
Private health insurance customers are switching providers at an unprecedented rate because of confusion about their coverage, putting $2 billion of revenue at risk each year, according to industry consultant Avnesh Ratnanesan.
Just under one million policyholders, or about 10 per cent, are switching providers in the $21 billion industry each year.
The main driver of that customer churn is confusion about the 48,000 different products being sold by funds, private health insurance executives told Dr Ratnanesan as part of a report to be released on Tuesday by his advisory outfit Energesse.
"Choice is not always a good thing for customers," head of customer experience at market leader Medibank Private, Harriet Wakelam, told the report.
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Date May 18, 2015 - 11:41PM
Pharmacists could receive public funding to dress wounds, deliver vaccinations and give weight loss advice under a $19 billion deal between the Abbott government and the powerful Pharmacy Guild.
Under the five-year agreement, announced by Health Minister Sussan Ley on Monday, patients could pay $1 less per script from July under a change the government hopes will promote greater competition among pharmacists.
It will be up to pharmacists to decide whether to offer the $1 discount, and pharmacists that do offer the discount would have to absorb its cost.
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Date May 18, 2015 - 11:40PM
Health Editor
A comprehensive health check for children aged three to five has been scrapped by the federal government to save about $144 million over four years, angering GPs and speech pathologists.
In last week's budget, the Abbott government axed Medicare funding for the "Healthy Kids Check", a consultation with a nurse or GP to assess a child's health and development before they start school. Funding for the program will stop in November.
The scheme, introduced by the Labor government in 2008, includes assessments of a child's height and weight, hearing, eye sight, oral health, toilet habits and known or suspected allergies to ensure parents understand the risk of anaphylaxis and how to prevent it.
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Incentive schemes fail to woo GPs
20th May 2015
More GPs pulled out of financial incentive schemes than the number who joined in a recent four-year period, apparently reflecting slim rewards for the time involved.
Writing in the current edition of the MJA, Professor Jane Hall of the University of Technology, Sydney, Business School, says the study confirmed previous findings that the proportion of income derived from incentive schemes and grants was not large.
Less than half of GPs (47%) reported earning any income from incentives in 2008, and three years later the proportion had slipped to 43%, according to data from a Medicine in Australia: Balancing Employment and Life (MABEL) sample.
“More in-depth analysis of changes across the four years of our study shows a more surprising trend – that there was a high rate of turnover among GPs who used these schemes, with some starting to use them, but a larger number ceasing to do so,” Prof Hall writes.
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Federal budget 2015: side-effect means sickest patients are to pay more for drugs
Date May 20, 2015 - 9:32PM
Health and Indigenous Affairs Correspondent
Some of Australia's sickest people will pay more each year for their medicines due to a little-noticed change in last week's federal budget.
Health Minister Sussan Ley on Monday announced an agreement with the Pharmacy Guild which she said would deliver "cheaper, more affordable medicines for consumers", partly because pharmacies will have the option of cutting the patient contribution by $1 per script.
However, from January the government proposes to increase the amount patients have to pay each year before they qualify for free or more heavily discounted scripts under the Pharmaceutical Benefits Scheme safety net.
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Andrew Tillett Canberra
May 22, 2015, 12:30 am
A $5 rise in co-payments for medicines will not go ahead after staunch Senate opposition forced the Federal Government to dump the proposal.
But it leaves Health Minister Sussan Ley scrambling to plug the $1.3 billion hole, a week after the Budget was handed down.
The co-payment increase was announced in last year's Budget, with the Government wanting to raise the price of a script by 80 cents to $6.90 for concession cardholders and $5 to $42.70 for everyone else.
As part of the change, the Pharmaceutical Benefits Scheme safety net thresholds were going to rise.
That would have meant patients had to spend more on medicines before they qualified for free or deeply discounted scripts.
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Date May 20, 2015 - 9:32PM
Health and Indigenous Affairs Correspondent
Some of Australia's sickest people will pay more each year for their medicines due to a little-noticed change in last week's federal budget.
Health Minister Sussan Ley on Monday announced an agreement with the Pharmacy Guild which she said would deliver "cheaper, more affordable medicines for consumers", partly because pharmacies will have the option of cutting the patient contribution by $1 per script.
However, from January the government proposes to increase the amount patients have to pay each year before they qualify for free or more heavily discounted scripts under the Pharmaceutical Benefits Scheme safety net.
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The Federal Government has hit back at claims it "sneakily" scrapped the after-hours GP helpline, saying funding will be redirected to a more efficient service.
Labor has accused ministers of abolishing the service in Tuesday's budget without warning or an up-front announcement, suggesting the move could put pressure on hospital emergency departments.
The $42 million helpline is used by over 200,000 people a year seeking advice on medication and minor health issues.
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May 22, 2015
The Hunter's GP Access network has been given a lifeline with the Federal Health Department guaranteeing funding for the next twelve months.
The after hours GP service had threatened to close its doors on June 30 saying without funding it could not guarantee around 100 staff positions.
The clinics treat over 50,000 patients a year, relieving pressure on hospital emergency departments.
Medicare Local, which runs the service, had expected an announcement of ongoing funding in the Federal budget.
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Pharmacy Issues.
Taxpayer savings of $5 billion-$6bn across the drug supply chain appear likely after the government reached in-principle agreement with the Pharmacy Guild on major script dispensing reforms.
The next five-year Community Pharmacy Agreement — valued at $18.9bn, as foreshadowed by The Australian last week — will see the existing mark-up system replaced with a volume-based payment that provides more protection from the variability in prices brought by other reforms.
Federal Health Minister Sussan Ley has also persuaded the guild to not stand in the way of pharmacists being given the option of competing on price by absorbing $1 of the patient co-payment under the Pharmaceutical Benefits Scheme. The guild remains opposed to the measure, however, which suggests it may have to be legislated rather than specified in the agreement.
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- Updated May 17 2015 at 7:52 PM
The Abbott government has struck an $18.9 billion deal with pharmacists to dispense taxpayer-subsidised medicine for the next five years.
Full details of the deal could be announced on Monday but industry sources have confirmed a "letter of intent" has been signed that sets out the elements of the deal.
The Pharmacy Guild, which represents pharmacy owners, had been pushing for a $21 billion deal amid difficult negotiations.
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Date May 18, 2015 - 1:30PM
Health and Indigenous Affairs Correspondent
Rules that restrict new pharmacies from opening near existing pharmacies will be extended for another five years despite numerous government-commissioned reviews recommending they be abolished.
Health Minister Sussan Ley announced on Monday that the rules would be extended until July 2020 as part of an $18.9 billion agreement with the Pharmacy Guild of Australia, which will also allow pharmacists to discount the fee patients pay for prescription drugs by $1 a script from next month.
Ms Ley said the agreement would deliver "cheaper, more affordable medicines for
consumers".
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A consensus looks to have been finally reached on the Sixth Community Pharmacy Agreement, with the Pharmacy Guild of Australian and the Federal Minister for Health signing a letter of intent.
The sixth agreement will commence on 1 July 2015 and run till 30 June 2020.
The widely touted pre-announcement lump sum of $18.9 billion over five years was the final amount agreed upon, despite reports the Guild had been arguing for a higher figure.
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- Sue Dunlevy National Health Reporter
- News Corp Australia Network
- May 20, 2015 12:30AM
CHEMISTS have a scored an average $117,000 per pharmacy per year pay rise — nearly twice the inflation rate — while every other area of health faces cuts in this year’s Federal Budget.
News Corp has calculated it will take a worker on average earnings six and a half years to pay enough tax to cover the pay increase to one pharmacy under Treasurer Joe Hockey’s new Budget fairness test.
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- May 22 2015 at 3:15 PM
- Updated May 22 2015 at 3:15 PM
Why waste time on a pharmacy review when the problem and the answer are simple? Alan Mitchell asks.
by Alan Mitchell
Tony Abbott is popular now because his budget was full of handouts. But his popularity may quickly fade when the public discovers that Australia is unprepared for the post-mining boom challenges.
Soaring iron ore and coal prices and the mining investment boom allowed Australians to ignore the economy's slowing productivity growth. But economists warned the mining boom would be temporary, and it was. Now the cost of Australia's extended bout of "reform fatigue" is starting to become apparent.
For economists the answer is crystal clear: growth-boosting economic reform of the kind that occurred under the Hawke, Keating and Howard governments.
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It is going to be very interesting to see what happens to the polls and consumer confidence over the next 2-3 months - especially if we see the Senate knocking more savings back!
Enjoy.
David.
