Getting Healthcare Reform Right

5 March 2010

Transcript of comments made by BCA President Graham Bradley to Fran Kelly of the ABC Radio National ‘Breakfast’ program on 5 March 2010

This transcript from Radio National Breakfast, first published by ABC Online, 5 March 2010, is reproduced by permission of the Australian Broadcasting Corporation and ABC Online. © ABC. All rights reserved.

Fran Kelly: A year ago, big business was applauding the Rudd government’s economic agenda. This year, well, it’s sounding like another story. Last month, the Business Council of Australia under the new presidency of Graham Bradley, withdrew its support for the government’s emissions trading scheme and urged a reassessment of the government’s stimulus money not yet spent.

But the peak business lobby group which represents the CEOs of Australia’s top 100 firms, has now given the thumbs up to the government’s plan to overhaul the public hospital system. The BCA President, Graham Bradley, joins us in our Breakfast studio. Graham, welcome again.

Graham Bradley: Good morning.

Fran Kelly: Graham Bradley, the BCA has criticised the federal government for the slow pace of reform. Is this takeover, this planned takeover of healthcare funding announced by the PM, the kind of action you’ve been wanting to see?

Graham Bradley: Well, we’ve nominated health as one of the five major priorities for reform, and it’s a tremendously important thing for us to get right in the long term; so we’ve welcomed the Prime Minister’s leadership in putting this on the agenda.

Fran Kelly: And as, from what you’ve seen, is it the right direction? And if you think it is, I wonder if you’re disappointed then by Opposition Leader Tony Abbott’s immediate dismissal?

Graham Bradley: Well, two comments on that. Firstly, there are many elements of what’s been announced that do seem to be a good attempt to move forward. There’s still more to be announced, as the Prime Minister said; and, of course, the devil’s always in the detail on this.

I think it’s fine for oppositions to oppose, but I think it’s important that they support sensible reform; and we’ve yet to see what the Opposition is going to propose in relation to health.

Fran Kelly: Not all the states are on board either, we’ve just been discussing. The Prime Minister’s threatened them with a referendum, which would be for a full Commonwealth takeover on health if they don’t support the plan. Would you support him in that?

Graham Bradley: Well, look, this is a really complex one and it seems to me rather difficult to frame it as a referendum issue, but let’s focus on what the Prime Minister has put forward and look at the merits of that. And a couple of elements of it seem to be directionally very attractive; firstly, local hospital boards I th… we think is a good proposal; and secondly, focusing on what we can do in the long term to reduce the burden of health cost.

This is not just about more money, throwing more money at health. We’ve got to fundamentally look at what we’re doing, what it’s costing, what’s the most cost-efficient way to provide the services the people need in moving forward. And we’re going to have an ageing population that might need to be served very differently; and that could be done at much lower cost.

So those are the kinds of reforms that are yet to be worked through.

Fran Kelly: That discussion has already led within 24 hours to a discussion about tax; and now there’s a suggestion the Prime Minister is preparing to delay the release of the Henry tax review. What’s your response to that?

Graham Bradley: Well, it’s a tremendously important reform. Tax is another major agenda item for the Business Council. We want to see a thoughtful debate around the key recommendations of Henry. It shouldn’t be rushed, but we’re looking forward to the release of the report.

Fran Kelly: How quickly would you like to see it?

Graham Bradley: It’s – I think it’s important that we realise that not a lot of this reform is going to be able to be done in the context of a constrained budget, which we – which we will have this year; and so it’s important that the good ideas in Henry aren’t too quickly dismissed or endorsed, in fact, by the government.

So it’s going to be a long period of mature reflection and consultation on this. So let’s see it by all means, but there’s no great urgency about when we see it. It’s going to take a long time to think through.

Fran Kelly: Should we see it before the election?

Graham Bradley: Absolutely.

Fran Kelly: Given the election is only, perhaps, six or seven months ago [sic], as we approach the end of the end of the Rudd Government’s first term, how do you rate its performance?

Graham Bradley: Look, the government’s had a global financial crisis to deal with; we give the government good marks for the way it’s responded to that crisis. And we now – got an economy that’s coming through that recessionary downturn, coming through it very well, thanks to many of the policies that the government has put in place.

We now need to step back and say, what do we need to do to secure the next 10 years of growth and make sure we optimise our position here? And one of the things we need to do is to bring the budget deficit down as quickly as possible.

Fran Kelly: And you gave a speech on that recently; you said the government should scale back the stimulus money not yet spent because the economy is starting to pick up. What do you mean there? What do you want to see the government scrap or reassess?

Graham Bradley: Well, it should reassess everything that hasn’t been fully committed, because its priority should be to bring the deficit down, not to keep stimulating the economy in a time when it’s already picking up and when we’re starting to see emerging again skill shortages and the like.

Fran Kelly: So school buildings, for instance? Are they stimulatory in your view?

Graham Bradley: We should … with those were temporary stimulatory measures. We’ve got to look at what the government’s spending its money on and make sure it’s spending it on income-producing productive infrastructure. That was always the priority, but, of course, as you know, Fran, there weren’t enough of those projects around when the GFC hit.

Fran Kelly: Well, now is your chance to get the message clearly to government. Would you like them to stop the school building that hasn’t started yet? Is that a good idea?

Graham Bradley: We’d like them to re-examine all the spending and not just stimulatory spending, but all the budgetary spending, including on the long-term programs that are increasing the cost burden of taxpayers, and re-look at the entire government spending with a view to living within the two per cent commitment the government’s made, the two per cent real growth in spending once the economy returns to its normal settings. And we’re there now.

Fran Kelly: The political debate is very different since the –Tony Abbott took over the political leadership of the Liberal Party – the atmospherics have changed –and also since Copenhagen Climate Change Summit in December, particularly on this issue of climate change.

This issue was a vexing issue for members of the BCA in the past; it’s been reported that the BCA’s decision last year to back the government’s ETS split your membership. Are they all on board now that the BCA has decided to withdraw the support?

Graham Bradley: Well, it was misreported that there was a split. The Business Council has been quite unified on our approach to emissions reduction for many years now. But remember, Fran, we were in an environment for the last three or four years where we had bipartisan support for an emissions trading approach. That is no longer the case. We also ha…

Fran Kelly: Is that what changed your position?

Graham Bradley: It – we haven’t changed our position; we’ve gone back to the fundamental principles that we’ve always espoused which is that whatever the gov… the country ultimately does to reduce emissions should be done at least cost to the economy and should not impair the competitiveness of Australia’s export industries.

Fran Kelly: And I understand it was the Business Council’s position that you were committed to action involving or being focused around a market-based mechanism where possible. Is that still your preferred position?

Graham Bradley: Yes, a market-based mechanism where possible will be part of a multifaceted approach to climate change – there’s no one single bullet here – and it’s likely to give us the lowest cost long-term reductions and that’s why we supported a well-designed and appropriately designed emissions trading approach.

But, of course, that design was forestalled; we haven’t yet got very clear proposals here that meet all of our requirements. And this is a very fluid situation now, Fran; there’ll be a lot of evolution of the policies of both sides in the context of an election. It’s not going to get resolved before the next election.

What we – what we’re trying to do is to remind all parties of the key criteria against which it should be judged.

Fran Kelly: And given – I’m sure you’ve had a look by now at the Opposition’s direct action plan; what’s your view of that?

Graham Bradley: Well, there’s a lot of details there that aren’t yet fully clear. What are the penalties for increasing emissions? How will that work? What will be the limits? So that’s an incomplete policy, too, in our view.

Fran Kelly: What about businesses’ position or commitment to the overall issue of reducing carbon emissions? There’s still plenty of community demand for action on that front; what’s the Business Council’s position in urging business to – what mechanisms for business to take to cut emissions?

Graham Bradley: A lot of businesses are just getting on with looking at their own carbon footprints, Fran, and taking initiatives across all sustainability issues, water as well as emissions and so on. It’s ultimately a matter for government as to what approach we take. And in the business community we’re trying to make sure that the risks associated with whatever plan government espouses are not such as to damage the economy moving forward.

Fran Kelly: Graham Bradley, thank you very much for joining us in Breakfast. Graham Bradley is the president of the Business Council of Australia, joining us in the Breakfast studio this morning.

[ends]