Rudd's Health Reform Plan Hinges on GST Decision

Kevin Rudd's ambitious plan to overhaul the Australian health and hospital network is on the line at a critical Council of Australian Governments (COAG) meeting, where the decision on the Goods and Services Tax (GST) could make or break his proposal. The federal government has locked in its commitment to meet future additional health costs, estimated at A$15.6 billion, but the states and territories are still holding out on the GST. Prime Minister Rudd has warned that if a deal is not reached, he will take the issue to a referendum, but Western Australian Premier Colin Barnett suggests that this may not necessarily resolve the GST dilemma.

Key Takeaways:

• The COAG meeting has turned into a high-stakes game of chicken over the GST, with the federal government and states and territories still at odds.
• The federal government has committed to meeting future additional health costs, estimated at A$15.6 billion.
• The states and territories are willing to dedicate 30% of GST funds to health, which would flow into a common pool.
• The federal government wants to seize about 30% of states' GST revenue in return for taking control of 60% of hospital funding.
• Western Australian Premier Colin Barnett suggests a referendum may not necessarily resolve the GST dilemma.
• The meeting is expected to run late into the night, with no guarantee of a conclusion on Monday.

Statistics:

• A$15.6 billion - estimated future additional health costs.
• 30% - percentage of GST funds that states and territories are willing to dedicate to health.
• 60% - percentage of hospital funding that the federal government wants to control.
• A$ billion - estimated annual revenue from the GST.

Sources:

• Asia Pulse, April 19
• Australian Associated Press (AAP)
• YouTube: Prime Minister Kevin Rudd's message