Budget, PBS, Coalition merger – Interview with Matt Abraham, 5AN

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Budget, PBS, Coalition merger – Interview with Matt Abraham, 5AN


Interview with Matt Abraham


Thursday, 23 May 2002

11.30 am



SUBJECTS: Budget, PBS, Coalition merger


… joins us now. Good morning.


Good morning, Matt.


You’re in Adelaide?


Yes, I am in Adelaide today. I am doing some functions, and I believe you are

having morning tea down in the mall. And congratulations. I think it is a great



Yes, we are having a, it’s a part of, as you know, Australia’s biggest morning

tea for the anti cancer effort.


Yes, which is great. We have been having a morning tea in our own office, so

we are trying to support it as well.


Now, Treasurer, yesterday you were on the New South Wales south coast. Today

you’re in Adelaide. This is part of your post Budget sales, sales spiel, is



Yes. After the Budget, I try and get around Australia as much as possible,

and I have been to Queensland and New South Wales and now South Australia. And

explaining to people about the Budget, and where the economy is, and talking

to them about issues that are of interest. And it is a great opportunity, actually.

We have a week off Parliament to go around Australia.


The latest Newspoll, yesterday I think, showed that it’s the first Budget since

the Dawkins, last Dawkins Budget, that has not had a very positive reaction.

Are you, are you troubled by that?


Well, the poll actually showed that the majority of Australians thought it

was good for the economy. That is what it showed. And I, when people said, “Well,

you know, do you think this gives benefits to you?” then they said, “Well,

we, it wasn’t one of these, what we call an election, a pre-election Budget.”

But when people were asked, “Is it good for the economy?” “Yes,”

they said. “Do you support the Government’s spending on defence?”

“Yes.” “Do you support the Government’s spending on security?”

“Yes.” “Do you support the Government securing our borders?”

“Yes.” So, it was a fair Budget, but it was not an easy one. I think

the public recognises that.


We’re getting a lot of callers in our programme, people particularly worried

about the Pharmaceutical Benefits Scheme, the cuts to that Scheme, cuts to the,

to the disability pensions, tighter requirements. Are you getting your message

across that it’s not as bad as it first appears?


Well, the changes are that if you are a pensioner, the cost of a prescription

is going to be $4.60. Now, that is not the cost of the medicine. Some of these

medicines are $100, $200, $300. But whatever the cost of the medicine, the taxpayer

provides the subsidy and the pensioner co-payment is $4.60, which is an extra

dollar. But after you have had 52 in a year, they are free anyway. So, it is

not a large rise. It is an additional dollar. And the object of this is, to

try and make sure that we can continue to bring new medical treatments onto

the Pharmaceutical Benefits Scheme.


And have you managed to get that message across to the Democrats, because the

Democrats have sent a very clear message soon after you handed down your Budget,

that they would, they would join with Labor to block those, those changes, particularly

to the Pharmaceutical Benefits Scheme?


Well, I think if they were to sit down and to actually think about it carefully

and to look at it, they would see that there is a lot of sense in this, because

no Government is going to be able to afford to bring new, effective but highly

expensive, drugs onto the Pharmaceutical Benefits Scheme if the taxpayers do

not have the capacity to pay for it. And you have got to have a fair way of

bringing these treatments on. For example, we listed a new treatment last week,

which cost $6,745 for a prescription. Now, a pensioner can buy that for $4.60

and the taxpayer subsidy is $6,740.40. So, even though the pensioner pays $4.60,

it is not the full cost at all. The full cost is picked up by the taxpayer,

and you have got to have a way of making that affordable. And this is my point:

That we want new treatments all the time, they are expensive treatments which

have to be bought principally from overseas from the drug companies. We have

got to have a sustainable way of financing that.


Peter Costello, what if, though, that they, they remain locked against this,

the Democrats and the Labor Party? What is your fallback position?


Oh well, if we do not make this Scheme financially sustainable, the Scheme

will just crack under its own weight. That is why it is completely opportunist

to say, “Oh well,” as the Labor Party is saying, “Oh, we’ll oppose

making it financially sustainable.” If you do not make it financially sustainable,

it will not continue to operate.


Are you saying that you, if the Democrats and the Labor Party don’t pass these

rises in the Budget process through the Senate, that you’re going to have to

have a look at the Benefits that are offered under the PBS?


What I am saying is, if we do not make this sustainable now, in, you know,

four, five years’ time, certainly in 10 years’ time, the cost of the flow-out

in this Scheme will be so great, it just will not be sustainable. The do-nothing

is not an option. There are two options here. We start with small measures now

to make it financially sustainable or, if we do not, you will have more drastic

measures later on. And the people who say, “Oh, do nothing,” are really

just sitting around waiting for this big financial trouble to come along in

four, five, 10 years’ time. And they are essentially trying to fool the public,

trying to fool the public into believing that this Scheme can continue on a,

on a basis which is not financially sustainable. And that is why I say do not

listen to that nonsense. Nobody believes that you can have the best medical

treatments in the world for free. It cannot be done. I think the public is smart

enough to realise that, and when they hear the Labor Party and the Democrats

say, “Oh, there’s no problems. No, it will all continue.” They know,

they know that is not right. And the important thing is to make sure it is sustainable.


Peter Costello, isn’t it about time the National Party and the Liberal Party

buried their differences and merged?


Well, look, there’s been talk of a merger for a long period of time but it

is not something that I think should be part of the public debate. I think it

is for the Parties themselves to discuss within their own private Party forums



So, it was, it’s not a crazy idea though is it, it almost, I mean you would

think a logical fit?


Oh, look, it has been around. We have been in Coalition for a very long period

of time and I am a great supporter of the Coalition. And, it has been said over

the years by some that we should go further than just Coalition, others take

the view that we shouldn’t. But these discussions happen from time to time and

I think it is a positive development within the confines of the Party. I think

it is up to the Parties themselves to conduct this discussion.


Can you tell us what you personally think?


Well, I will do that within the confines of the Party.


So, Nick Minchin was a bit silly, was he?


Well, the only point I would make is, it is not something to go out in, into

the public debate. You have got governing councils of each of the Parties. If

there were to be new arrangements it would be a matter for them, and it is really

something that should go to the governing councils, I think, of the Parties.

If they are interested you would get progress, if they are not interested you

wouldn’t. But, you have got to first assess the views of the governing councils

I think.


Now, Peter Costello, I saw you with a golf club, a photograph of you with a

golf club – I am a bit worried about your grip – in the paper…


It looked very bad, didn’t it.


…and then I thought, he’s on the front lawn of The Lodge, he’s trying

out Bob Hawke’s putting pitch. You’re not? No truth to that?


I was actually in Merimbula, and we were at a golf club and they asked me to

go outside and hit off the first tee, and it was a pretty awful sight. It wasn’t

just the grip that was bad, the swing was even worse.


Peter Costello, thank you.


Thank you very much for your time.


Thank you.