Editorial: Financial health is the real priority

For any government, health spending is the most tempting of bottomless pits. No other source of funding is so much about life and death, or has quite the potential to excite dissent at the ballot-box. And no other group has quite such a receptive public ear as medical professionals when they covet state-of-the-art equipment, new procedures or even a pay increase.

But a government must balance the voter-friendly impulse to satisfy such demands against the well-being of the economy and the needs of education and suchlike.

Such an exercise in counterpoise was attempted in this year's Budget. Hospitals received only a $900,000 top-up as part of a slimline overall increase in health spending. The Minister of Health was almost apologetic. The Government would like to spend more, said Annette King, but had to balance that wish against a determination to be fiscally responsible.

Such tough decisions face all administrations. Making them, no matter how great the potential cost to popularity, is a measure of their integrity.

The need for Government steadfastness has not waned since the Budget was delivered in May. The terrorist attacks of September 11 have prompted an even more subdued economic outlook for the next half-year, reinforcing the need for restraint. Unfortunately, the Government seems about to shelve its determination.

The reasons are not difficult to discern. In the past few months a flood of bad publicity has come from the health sector. Most dramatically, perhaps, some cancer patients have had breasts removed rather than face a wait of five to six months for radiation therapy.

And even as belated Government financing for treatment in Australia patched up that crisis, strikes by health workers in various centres have reinforced the widespread sense of unease.

It is an impression that may not be assuaged by the creation of, so far, compliant district health boards. The Government came to power promising big improvements in health care and asked the better paid to pay higher taxes for that and other benefits. As an election year looms, it has not only failed to produce much improvement but fallen victim to its own raising of public expectation.

The Government's response is as predictable as it is short-sighted. Health will receive a far greater proportion of public spending. Of the $815 million budgeted for new spending in the next financial year, additional health spending could account for about $400 million, possibly more. The money will probably be given to hospitals to use in existing programmes rather than new activities.

In effect, that is an admission of an unrealistic emphasis on illness prevention in this year's Budget. Hospitals have had to absorb the costs of inflation, increased expenses for medical supplies and staff wage demands. The Government's call for economies gained little traction. Instead, public pressure came into play when health sector leaders talked of only two options, a reduced standard of patient care or increased deficits.

This year's Budget held out the prospect of more public health spending in the next financial year. The Government doubtless recognised the sector could be its Achilles' heel in an election year. It knew the Opposition would emphasise spending on healthcare, as has happened with the plan to use money gained from cancelling the Government's huge superannuation fund.

But its plans surely never encompassed employing half the money for new spending in next year's budget on basic hospital services. What that munificence means, of course, is that other sectors will inevitably suffer cuts, some utterly unwarranted. And that a tight rein on public spending, necessitated by the gloomier economic tidings since May may be loosened.

The Government must keep the need for fiscal responsibility uppermost in its mind. Understandably, it worries that health's high profile may undermine its chances of re-election. But it can tackle that fear most effectively by rejigging its health priorities.

It is fine in theory to direct money towards the primary care arena of illness prevention, and to give hospitals the status of ambulances at the bottom of the cliff, but only if the primary care is of sufficient quality to reduce the pressure on hospitals. Clearly, that is not the case, and hospitals deserve a higher funding priority - but mainly from within the health vote.

Money must not be dispensed at the expense of other important sectors or at the cost of economic prudence.