2015 Federal Budget-Health Professional wages in the firing line?

The 2015-16 Federal Budget appears, on its surface, to be a kinder, less ideologically driven economic plan than its predecessor. A closer inspection of the details however suggests otherwise.

Certainly the cuts to welfare payments, overt attacks on Medicare and billions stripped from education are not there this time. Nevertheless, this is a staunchly ideological budget and one that we believe will have a significant and detrimental impact on healthcare and healthcare workers over the next five or more years.

Of primary concern to the health workforce is the removal of nearly $2 billion from the health system over the next five years. This comes on top of the $57 billion removed from the public health system at the last Federal budget.

While there is some clarity regarding areas slated for cuts much remains hidden. We are told that savings will come from ‘rationalising and streamlining’ a range of health programs. This level of imprecision is not uncommon for budgets, which are built on assumption and by their very nature rely on forecasts.

Having said that, there is a great deal of concern around the Abbott government’s ideological motives. Healthcare workers should be concerned as there are strong indications suggesting that there is an ideological commitment to cut wages. Indeed, the Abbott government holds a clear position on this matter.

Joe Hockey’s 2015 Intergenerational Report is a central mechanism used to set the scene to justify further shifting the costs of health care from government onto families and individuals.

Worryingly, the 2015 Intergenerational Report suggests that “non-demographic factors, including higher incomes, health sector wages growth and technological change, are more significant drivers of the projected increase than demographic changes.”

That is, the Report claims health sector wages are a more significant problem with regards to health spending than the aging population in terms of health costs. This is an assertion that governments may use to justify a freeze or even cuts to wages for Health Professionals.

We know, in terms of the public hospital system, that Victoria is ‘the most cost-efficient state’. We also know that Victoria’s Medical labour costs are the lowest in the nation. This is no happy coincidence. Efficiencies are easily found where wages are lowered and productivity rises. That means, you to work harder for less.

At this stage there is no clarity on what sort of approach the Andrews government is going to take to deal with the federal funding shortfall in health. This will become clear over the coming months.

The VHPA position is clear: we want good healthcare jobs that provide fair and reasonable remuneration and importantly jobs that will attract the best people for years to come—our children don’t just need good healthcare, they need good jobs with good pay.