Health

Prime Minister: In the future where we see these reforms going is to, as an Australian Government, fund these local hospital networks directly in order that they will have secure, long-term funding to deliver the best possible services to the people of these communities - that's why, the system again, a National Health and Hospital Network funded nationally, run locally though local hospital networks to make these decisions work on the ground.

We've also seen this morning how some of the practical measures that we've taken so far are beginning to take effect.

Outside we saw the evidence of the construction of the new teaching facility, which we are co-funders as the Australian Government. What does that mean? It means that for local hospital networks and local hospitals like this we can bring in the teaching services which are necessary here in this part of Melbourne relevant to the needs of this community. And so what you'll have there is the onsite clinical training of doctors, the onsite clinical training of nurses in much greater numbers than we've ever had before, and we're proud to be co-investors in that.

Under the new National Health and Hospitals Network the Australian Government will become the dominant funders of those sorts of facilities in the future.

Of course the other areas where we've got some runs on the board is the expansion of the operating theatres that we've seen here today as well at Sunshine.

The fact that we're able to invest already several million dollars in building a new operating theatre, enhancing the existing one to lift the overall throughput of this hospital.

We as the Australian Government would take on the dominant funding responsibility for the future expansion of operating theatres and the future expansion of hospitals themselves like the one here at Sunshine; that's why we need to get this reform done.

(The video related to this transcript is available from the Multimedia section of this website.)

PM: It's been good to be at this GP practice in Hornsby in Sydney to hear first-hand from the local GPs and local training GPs about their needs. I've listened very carefully to what the local GPs have had to say about their needs. Essentially, it goes down into two things, if I've got it right. One is there is simply not enough GPs at present and the second is that the biggest complaint from patients is not being able to get an appointment with your GP on time or your preferred GP on time.

That means we've got to deal with this whole question of the medical workforce, and that's why the Australian Government has been very clear-cut about what we intend to do, which is invest in an additional 6000 GP training places and specialist training places over the decade ahead. There's also another program, which we are increasing our investment in significantly. And that is called the junior doctors program, for want of a better term.

The junior doctors program currently runs at about 400 places a year. We're going to be increasing that to something close to 1000 a year. And that's to make sure that young doctors, once they've graduated from university, once they've done their term as interns within hospitals, can have experience here in real live GP practices out in regional Australia and suburban and rural Australia and regional Australia to get a taste of what GP practice is all about, and hopefully stay in GP practice as well.

There is a huge undersupply of GPs across the country. This is an ageing medical workforce. And therefore, we need to get as much young blood in the system as possible. So the way in which we're going to do that is increase the number of training places for junior doctors, increase the number of training positions for GPs and increase of course the number of training positions for medical specialists.

I've also had the opportunity to talk to doctors here from the local hospital here at Hornsby Ku-ring-gai. And I've heard firsthand about the needs there, as well. I understand this is a significant hospital in terms of its overall beds, 200 plus. Medical staff, I think- have I got it right- of 130 odd. And the needs for hospitals like this to have a strong investment in their future. Under the Government's proposals, what we plan to do is for the first time in Australia's history, is for the Australian Government to become the dominant funders of the public hospital system in the country. The dominant funders of the recurrent needs and costs of hospitals like here at Hornsby Ku-ring-gai, the dominant funder for the first time of their capital needs, that's new buildings, plant and equipment, operating theatres and the rest. The dominant funders of also, their teaching, their training, and their research functions as well. In the past, the Australian Government provided 35 percent of the recurrent costs, zero per cent of the capital costs, zero percent of the equipment cost, and effectively zero percent of the teaching and training burden as well.

So for local hospitals like the one at Hornsby, it means that through our proposed new national health and hospitals network, we will become the dominant funding partners for hospitals like this in the future. Therefore, we believe the time for fundamental health and hospitals reform has come. With GP practices like this, so we can make sure we've got a proper GP-trained workforce into the future, but also for important local hospitals like this as well, so they are properly funded for their future as well. Over to you folks.

JOURNALIST: Mr Harris says that part of Hornsby hospital need to be bulldozed. Will your plan include enough money for that?

PM: Well, for the first time the Australian Government becomes the dominant funder of the capital needs of the system. I can't, for example, conduct an on-the-spot analysis about what part of the hospital, quote "needs to be bulldozed", and, quote "needs to be rebuilt". The planners will give us advice on that. But can I say this, for the first time, the Australian Government will be stepping in to the breach, and becoming the dominant funders of the capital needs of hospitals like the one at Hornsby. And of its equipment needs as well.

A lot of the public hospitals across Australia have become tired and old in terms of their plant and equipment. There are 764 public hospitals in Australia. This is one of them. And it's one of the bigger ones. Obviously, the big difference is us becoming the dominant funders, and we will look forward to providing, through that funding, better health and better hospital services for the people of this community as well.

JOURNALIST: You've spoken to a number of Premiers now about your plan. What signals are you getting that the states will agree to your plan, and what other sorts of things are they asking?

PM: We've had good discussions so far with the Premiers of New South Wales, the Premier of Queensland, the Premier of Victoria. That's just in the course of the last week. And in the middle of next week, I'll be heading over to Western Australia to see the Premier there as well. What I sense across the board with all the Premiers is a desire and a determination to move ahead with health and hospitals reform. Plainly, they have raised a number of questions where they want more information.

We have multiple official discussions underway now at the health level, at the treasury level, to work our way through those. But I would still urge and encourage each of them to come on board with fundamental national reform. Let me say one other thing. However, if we can't reach cooperative agreement with the states and the territories on our new national health and hospitals network, as I've said consistently, the Australian Government would then seek a further mandate from the Australian people in order to implement these reforms.

We believe the time has come. I don't think anybody out there is saying the system at present is good enough. People want better health and better hospital services nationwide. It's time we stopped talking about it, and getting on with it nationally.

JOURNALIST: Mr Rudd, there's some concern that Western Sydney hospitals will suffer to (inaudible) they're so busy with emergency procedures that they don't have time to do any elective surgeries (inaudible).

PM: Can I say that there have been a number of scare campaigns launched by various state health bureaucrats in various parts of the country over the last couple of weeks. This is another one of them. Under our proposed funding model for hospitals for the future, including those in Western Sydney, where you've got big population growth, where you've got the delivery of many, many hospital services, those hospitals will benefit from the funding model that we've proposed, and be able to expand their services.

That's what we want to see. I think we've got to be very careful about separating out some fear-mongering on the one hand, from what's necessary for long-term reform of the system on the other to deliver better health, better hospital services for working families right across Australia, including in Western Sydney.

JOURNALIST: Prime Minister, what rules would you like for your debate with the Opposition Leader over health?

PM: I'm pretty relaxed about all that. I'm sure others will sort that out. I think the good thing is this: we are going to have an opportunity to debate the future of the health and hospital system of Australia. The Government has put forward its plan, a new health and hospitals network. It'll be funded nationally, run locally through local hospital networks, and for the first time, the Australian Government taking the dominant funding responsibility for the public hospital system for the future. And we've detailed that in a 72 page plan. And since then, we've also announced a very large investment in 6000 additional medical personnel- doctors, GPs, specialists for the future. That's our plan.

Mr Abbott, of course, will have an opportunity to put forward his plan. That's why I look forward so much to the debate, because it'll be a debate about his record, our record of achievement, our plans for the future, his plans for the future when it comes to health and hospitals. This is fundamental for working families across Australia.

JOURNALIST: How does this marry with the idea of federalism and the states looking after their own affairs?

PM: I think it is important to enable the states and territories to get on with the business of providing the full range of their services. Let me give you one example. If we keep the system as it is at present, apart from delivering less GPs, less specialists, less nurses and can I say, less investment in hospitals like Hornsby in the future, there's one other disadvantage which flows as well, and that is that state budgets in the future cannot sustain the current growth in health and hospitals expenditure, let alone what will be needed in the future.

I think, various of the premiers have said to me, and have said publically, that without change, health and hospitals by itself will consume the entire state budgets of state governments around Australia over the next 20 to 30 years. In other words, not a buck left to do anything else. That is, for schools, for TAFEs, for transport systems, public transport, for road construction, or, for that matter, for law and order. So if you want the federation to work, it's really important that you, as an Australian Government, step in with the biggest single area of growth for the future, namely, health and hospitals expenditure, take on the dominant role, take on the dominant responsibility for the future growth of the system and allow the states and territories to have the financial capacity to deliver the other services for which they are responsible.

JOURNALIST: Mr Rudd, other commentators have said that you came off second best during yesterday's Question Time stoush with Mr Abbott. What's your response to that?

PM: You know something? I value always, an opportunity to debate the future of the health and hospital system because working families across Australia not only want these matters debated, they want action on them as well.

Can I just say one other thing on the question of action? My political opponent, Mr Abbott, the Leader of the Opposition, was Health Minister of Australia for nearly five years, right up until 2007. And in that period of time he said that the Australian Government should take over the hospital system of Australia. Nothing happened.

Instead, what he did as Health Minister was rip a billion dollars out of the public hospital system. Instead what he did as Health Minister was put a cap on GP training places when he was Health Minister. He gave the Australian people a rock-solid, iron-clad guarantee that the Medicare Safety Net would not be touched. That only held up until the election because then it was fundamentally changed afterwards. And remember also, he was part of a Government which abolished the Commonwealth dental scheme, which left 650,000 people out there without any public dental care.

So on the question of compare and contrast, records of what's been done in the past, and plans for the future - I welcome future debates with Mr Abbott on the future of our health and hospital system. His record is not a flash one.

JOURNALIST: Mr Rudd, are you confident that Australian uranium won't be used to produce weapons if we exported it to Russia?

PM: With Russia, we have of course, a country which has signed up to the relevant international instruments, legal instruments. And on top of that of course, we have our own bilateral safeguards arrangements with them as well.

Therefore, that is the system that we have applied in relation to all the other countries that we have exported uranium to for the last 20 to 30 years, and that'll apply in the case of the Russian Federation as well.

JOURNALIST: Do you have any idea what, how long Barack Obama will spend when he comes in June, and whether he can address a joint sitting of Parliament?

PM: The President and I had a good conversation this morning on the phone. He's, of course, sorry that he can't get to Australia right now. He wants to come back at a later stage with a bit more relaxed timing so he can bring Michelle and the kids. I said, 'I think Australians would like that as well'. The President of the United States is a welcome guest in Australia at any time, and that applies to President Obama as well.

But, you know something? A lot of our conversation focussed on health reform, both in Australia and in the United States. The President and I face a couple of challenges in common - the President is trying to bring about health and hospitals reform as I am in Australia and the President is facing a Senate which only seems to know one thing, which is to block reform. So, we had a bit of a conversation about those things.

JOURNALIST: And how important is the health policy for you, given the criticism you're facing over the insulation scheme and the school stimulus, especially in New South Wales?

PM: Look can I say that the Government is committed to keeping the economy strong, protecting hundreds of thousands of jobs of working families, and keeping Australia out of recession, unlike every other advanced economy, practically, in the world. And we did that through a national infrastructure stimulus plan, which provided hundreds of thousands of jobs in Australia and jobs growth in Australia, when you found, right around the rest of the world, millions of people losing their jobs.

That's the first thing. That's on the economy.

Our second commitment is this - to deliver the basics to working families: fair laws for their workplaces; investment in schools and lifting the standards of our schools through schemes like My School; and then, thirdly, delivering when it comes to improved health and hospital services for working families as well.

They are the priorities of the Government. We intend to get on with the business of doing it.

JOURNALIST: Sorry, can I just ask you - on the Senate, Telstra shares are doing really well at the moment (inaudible) plans split up Telstra. Will it pass the Senate before the election, and will you give a commitment that the Government is committed to that, and what would be your message to retail investors?

PM: First of all, I don't provide any advice to anyone of an investment nature. That is a matter for them and those who advise them. Secondly, our policy in relation to Telstra, our policy in relation to the National Broadband Network, has not changed one bit.

And, having, said that, I think I should conclude, but with one final comment about the state elections, which will be held in a couple of states around Australia tomorrow.

Can I say this: that both these state governments, both these state governments, both these state Labor governments, are good governments, but because they are long-serving Labor governments they will go into these elections as the underdogs. Can I say both these elections this weekend are likely to go down to the wire.

I think the people of Tasmania know that David Bartlett has delivered for them and that he has a plan for their future, a clear plan for their future. In South Australia, people know also that Mike Rann has delivered strongly for the South Australian economy, and in other areas as well, and he has laid out a very clear plan to keep South Australian moving ahead.

Both these governments, long-serving Labor governments, go into these elections as the underdogs, and these elections will go down to the wire.

Thanks, folks.
 

HOST: Good morning, Mr Rudd.

PM: Good morning. Thanks for having me on the program.

HOST: Has the President called you yet?

PM: Yeah, I got off the phone from him about an hour or so ago, and we had a good chat. He's sad and sorry that he won't be here in Australia in the coming week or so, but he's looking forward to a more relaxed visit a little later on in the year.

HOST: So a little longer, obviously?

PM: A little longer, because he would like to be here with Michelle and the kids, and he's visiting both here and Indonesia, so there's scheduling there as well, but as it was turning out last time the visit was just going to be too tight and too short, so he's looking forward to something longer later on.

HOST: Who's got the tougher battle to get their health plan up? Him or you?

PM: I think the President and myself face some common challenges. Number one is we're both trying to get health and hospital reform done, and number two is we both face Senates who want to block everything. So, I had a chat with him about how it was all shaping up in the United States.

For your listeners, remember in America there's no Medicare. In America, frankly, the public hospital system doesn't work properly, so if you're a poorer person on lower income there's just nowhere much to go. So, he's trying to fix that, and full marks to him for doing it.

Here in Australia, we've got our own challenges, which is the proper funding, long term, of our public hospital system and health system more generally. So, we have a challenge to make sure we get the states and territories on side with that, but if we don't, as I said, we'll seek a mandate from the people to obtain the powers necessary to bring about these reforms anyway.

HOST: Because it's going to be even tougher after this weekend with Labor tipped to lose both in Tasmania and South Australia.

PM: Well, these will be tough elections for both the state governments in South Australia and in Tasmania. They've been there for some years, but this'll be a tight election campaign, it has been a tight election campaign, and the voters will decide.

But for health and hospital reform, my own view is it should go, frankly, beyond party politics. This is just crying out for change. People want more hospital beds, more doctors, more nurses, but they want to make sure that the system doesn't just keep up this cost-shift, blame-shift, pass-the-parcel exercise we've had for decades now. That's why we've put forward the national health and hospital network, funded nationally, run locally, with the Australian Government for the first time being the dominant funders of the system.

HOST: When we last spoke, you talked about New South Wales health bureaucrats trying to undermine this process. You might notice in the paper this morning there are stories from New South Wales Health talking about big western suburbs hospitals like Westmead which will suffer under your plan. Now, is that true, and is this continuing this battle you're having with New South Wales?

PM: I think these state health bureaucrats should stop running fear campaigns because they are frightened of fundamental changes for the future. What we want is more frontline services, more doctors, more nurses, more hospital beds. That's one of the reasons why the Health Minister and I released earlier this week a plan to invest $600 million-plus for 6,000 new, additional doctors, medical specialists, GPs, because there's a crying shortage around the country. So, I think it's time people got with the program.

HOST: Yeah, but New South Wales is the state that'll, it seems is going to be the biggest stumbling block, has to make the most changes. That meeting you had with Kristina Keneally last week, were you rude to her? Were you deliberately rude to her?

PM: We had a very good meeting, and it was substantive, it was positive, it was constructive-

HOST: -But that image of you looking away and being, you know, ignoring her.

PM: It was substantive, positive - seriously, it was a very good meeting.

HOST: But was it just, were-

PM: -I think both of us were surprised by some of the subsequent media coverage.

HOST: Was it the visual version of verballing, was it?

PM: I think we had a really good meeting. I think we're both surprised. It's Carmel as well, Carmel Tebbutt, we were both surprised by some of the media coverage later.

HOST: Do you like her? Do you like Kristina Keneally?

PM: We get on very well, as do I with the Deputy Premier and Minister for Health, Carmel. I've known both of them for quite some years. It was a really good meeting, as was the one in Queensland with Anna, as was the one in Victoria with John Brumby.

I think people are serious about getting on with the business of health and hospital reform, but you know something? I'm not really interested in atmospherics. I'm interested in substance. I'm interested in getting on with the business of changing the hospital system.

For your listeners this morning, have they got a problem with being able to find a GP on time? Have they got a problem in terms of a waiting list for elective surgery? Did they have a problem last night at accident and emergency at one of the hospitals around here? These are the problems I want to deal with, and that means cutting out waste and inefficiency from the system, because of the Commonwealth-State brawl. It means properly funding the system for the future, hence why, for the first time in Australia's history, the Australian Government would be the dominant funder of the running costs of our hospitals, the capital costs of our hospitals, the equipment for our hospitals.

Just last week I went out to Royal North Shore here, and we had funded a new PET scanner. There's only six of those in Sydney, and we've just opened the sixth, and we've paid for it.

We should have a better system than that, whereby the folk who use the Royal North Shore hospital or who depend on it for cancer services - it goes right through to the New South Wales central coast - shouldn't have to wait for a decade or so for a PET scanner to come on-stream. You need a more rational planning system than that. That's what we want to bring about.

HOST: You talk about atmospherics and how you don't like them - a lot of atmospherics in Parliament yesterday. You and Tony Abbott, it seemed to get almost personal. Do you like Tony Abbott?

PM: I've known Tony for a long, long time, so obviously he has a different set of political views to myself, and a different set of policy views. This was a big debate over health and hospital reform and all I was making a point was that Mr Abbott had four or five years as Health Minister, right up until the last election, to fix the system. He said four or five years ago, the Commonwealth should take over the system - well, he didn't.

During that period of time as Health Minister he took a billion dollars out of the public hospital system. He capped the number of GP training places. And then, hand on heart, said that he'd never, ever change the Medicare safety net, a promise he subsequently breached. So, his record on health is bad.

But you know what I'm more concerned about? What's his plans to fix up health for the future. Our plan's clear: a new national hospital and health network for the nation, funded nationally, run locally, with 6,000 new doctors, medical specialists and GPs. That's what we want to do. We don't have the alternative plan yet.

HOST: In this debate you'll have with Mr Abbott to discuss all this, will it be a freewheeling debate, or is it going to have set times that you can both speak? What will be the format?

PM: The format, I'm sure, will be sorted out in the days ahead. I'm pretty relaxed about that.

HOST: Can we have as few rules as possible, just where you can go at each other?

PM: Oh look, I'm pretty relaxed about all that. The key thing is to make sure that the people listening to the debate and who really care about the future of their local hospitals and enough beds, enough doctors, enough nurses, that my plans are clear in people's minds as to what I propose to do, but so are his.

HOST: Well hang on - because in relation to that, the suggestion is that small, local hospitals that have relied on block funding under your plan will not be able to survive under this casemix funding system that you want to introduce, and that you're going to deal with that down the track aren't you, with some of these other funding announcements? So, will you have those on the table next Tuesday so people can see what the future of that hospital will be?

PM: You mentioned before a fear campaign or the possibility of it from various state health bureaucrats. That's one of them.

Let me say very plainly on your program this morning under our proposals for this new national health and hospital network, there will be nothing in that plan at all which would cause any hospital, large or small, to close - quite the reverse. We see, for example, in western Sydney, where you've got a vastly growing population, the need to expand all those hospital services, and if you're servicing a big and growing community, our funding system would actually support that to grow those services.

At present, what happens is people are given a fixed budget once a year - that's it, goodbye. Now, that shouldn't be the case. We want a new system for the future and I think those who are arguing against it seem to be saying almost by implication that the current system is just fine and dandy, we'll defend it how it is. I don't believe that's the case, nor do I believe that's what working families want in Australia either.

HOST: Because the detail is important in this, and some of the, even in Victoria, where they've got the system operating, they've had to return to that block funding for smaller hospitals to avoid them closing, so would you do that in New South Wales, extra funding for some of those smaller, regional hospitals?

PM: To support the needs in rural and regional areas - remember, I grew up in a small country town, we had a visiting doctor once a month for half a day and the nearest hospital had about 12 beds and it was a while away, so I actually understand this from the point of view of growing up in that area-

HOST: -So would you have that extra funding?-

PM: -Therefore, going on to your point about making sure those services continue, we would absolutely make sure that those services continue and the formula that we are proposing for what's called activity-based funding is entirely tailored to the local circumstances of how far away are you, how difficult is it to deliver those services there, how more expensive it is to get a visiting specialist there, for example - on top of the particular, shall I say, concentrations of health problems in particular parts of the country as well.

So for us, and you go to the question of additional funding grants, we'll be very mindful of particular needs in the system.

HOST: So there could be block funding for some of those hospitals.

PM: We'll be very mindful of particular needs in the system because, as I've said before, there is nothing in what we are proposing which would cause any hospital anywhere to close down. That is, in essence, the fear campaign being run by the state bureaucrats who want to see no change occur.

HOST: But you understand, people criticise you for being verbose. It's a simple question. Are you going to put in block grants to deal with that, and the answer would be either yes, you will, or no, our system will deal with it. So you're saying no.

PM: What I said to you before, John, is there's nothing in our funding system which would cause any of those hospitals to close. That's your direct question, that's my direct answer, and I believe that's the assurance which I've been giving to folk as I've been asked this since the debate on this was first kicked off by state health bureaucrats putting stuff out in the papers a couple of weeks ago, and I've been pretty consistent about that.

HOST: Prime Minister, can I ask you about the school building program which has had so much debate over the past week, and Julia Gillard has been in parliament defending the program and the way it's been implemented. A simple question about the school that's almost become the focus of the program, Hasting Public School at Port Macquarie - how is it that that covered outdoor learning area that was budgeted for, I think, $400,000 or so can suddenly blow out to $900,000? It's a simple question that I don't think anyone's adequately explained yet.

PM: Well, I think from my last conversation with Julia the audit on that one hasn't been concluded yet, so let's just look at the facts once it's through. You ask me about one school. We're currently engaged in building programs for 10,000 schools across the country, 7,500 primary schools, larger scale, as well as science centres, new science centres and language centres in the secondary schools, as well, so I looked at the figures on this the other day in terms of where problems have arisen - across those 10,000 schools, complaints have been raised in terms of 0.73% of them.

Can we just put this into some context? This was done deliberately to keep the Australian economy going at a time when economies around the world were falling into recession - falling into recession. We, Australia, did not go into recession, and one of the core reasons that didn't happen is we decided to use a national infrastructure stimulus strategy, but not just that, to provide state-of-the-art libraries, state-of-the-art science centres, state-of-the-art language centres, multipurpose halls, new classrooms for kids right across Australia.

We're proud of what we've done. There's going to be problems, always, in the implementation of large scale programs. You just deal with them one by one.

So, when the audit's through in the school that you're referring to, I'm sure Julia will come to your program and go through the detail of it.

HOST: We'll remind her of that. We will, thank you.

HOST: Just, finally, Newspoll this week, I think your approval rating's gone down more than 20 percent from its high. What do you say to the more than 20 percent, a quarter of the people in the poll now don't approve of you, who used to approve of you. Why is that?

PM: Well, you know, my job is to take some hard decisions for the nation. Some of those will be popular and others will not be. One of the hardest decisions we took a year and a half ago was decisions to step into the breach with the Australian economy so it wouldn't fall into recession. Now, some of the programs that we've put in have resulted in criticism. You just referred to one of them now.

So, when it comes to election time, people will make their judgement, and my experience of the Australian people is that they are hard judges but they are fair judges, both on your record of what you've done, which is keeping this economy out of recession, protecting the jobs of hundreds of thousands of working families compare with the rest of the world, and then plans for the future - how we intend to deal with the health and hospital system.

It's going to be a huge debate about all these things. I understand that.

HOST: Mightn't it be that they just agree with you that you could have done better? You spent a week telling us that you really thought you could have done better. Do they just agree with you?

PM: Well, the point is that they will mark the Government, they'll mark me, on the basis of what we achieved and our plans for the future, and what I'm saying on that is that in terms of what we've achieved, keeping the economy strong, protecting hundreds of thousands of jobs of working families at a time when the rest of the world crashed into recession, that's not a bad achievement.

And, secondly, not just starting the reform of the health system now - we've increased our investment in the public hospitals of the country by 50 percent already, but this big plan for the future is about how do you deal with the deep surgery it needs for the long-term future? How they judge us in the end, John, that's a matter for the people - as it should be.

HOST: Do you agree that we're in a pseudo-election campaign already?

PM: You know, I presume people were in that frame of mind from the day after the last one. I don't know. My job in these limited, 3-year terms that we have here is to make use of every day to try and make a difference to working families' lives, and I am concerned - as we began this conversation today - about what's happening at the accident and emergency last night, what's happening for elective surgery today, have you got enough GPs in your area, are there enough medical specialists? And, last week, here at the Royal North Shore, to be there to see the opening of a PET scanner, I think the sixth in Sydney, which we funded directly, the Australian Government, which affects so many people-

HOST: -Didn't Tony Abbott approve that, though?

PM: Well, this is a really interesting story. What the locals have said to me is-

HOST: -He claimed to parliament he approved it.

PM: Yeah, well the Royal North Shore started making representations to them, that's the previous government, in 1997. I'm advised by the locals that Mr Abbott supported this on the eve of the last election in 2007. We actually funded it. We actually built it. We've installed it. We've opened it and it has been in operation now for one week. I think the locals are more concerned that it's there.

HOST: OK. So, you don't think you're rattled, because there are commentators lining up to say you're rattled.

HOST: Not only you, but let me say it, the party - panicked and irrational nervousness in the ranks about the next election.

PM: You know something? Political commentators will roll out there, say a whole bunch of things, and guess what? A lot of them may not like us, a lot of them may like us from time to time, a lot of them may loathe us for all the time - that's one of the great things about the democratic system which we are.

Our job is to get on with the business of governing, and on the question of having a debate health and hospitals reform, you know something? I welcome that with open arms. We have a plan for the future, it's clear cut, it's there, it's an extensive document. My opponent doesn't have a plan, and he has a record, and the record on health and hospitals is pretty damn awful.

HOST: Prime Minister, thank you for your time this morning.
 

HOST: Earlier this morning I spoke to the Prime Minister, and asked him what those places will mean for regional Queensland.

PM: Well altogether what we are doing through our national health and hospitals network is funding an extra 6000 doctors over the coming decade. That'll mean 5,500 new or training general practitioners, 680 new medical specialists, as well as about 5,500 junior doctor places as they train within our hospitals.

The second point is this: for regional Australia- and that means places like Far North Queensland, we are for the first time tackling the central problem of not enough doctors nationwide, and a large number of these GP training places and specialist training places will be going to regional areas. That's our best way of tackling the doctor shortage. It's simply been left too long with no concrete action.

HOST: So those training places - assigned to regional hospitals?

PM: For the medical specialists - there are 680 of those- the concentration there is in rural and regional areas. The concentration there is in a whole range of other areas beyond capital cities. On top of that, we of course, will continue to train medical specialists within the major teaching hospitals within capital cities. But this 680 is dedicated in particular to deal with the needs of regional and rural Australia. The second thing though, is on the GPs - and many people, many people right around the country can't get proper access to a GP.

These GP training places will be also available to regional and rural areas, because we want local doctors as they come out of medical school to be trained as GPs in situation, on the ground, in wonderful cities like Cairns and Far North Queensland, then become established in the local community, and stay there.

HOST: How are you going to attract people, though, to do that? It's one thing to allocate the training places, but is there a way to tie these training places to smaller, regional centres, particularly the very small places?

PM: Well one of the initiatives which the Government has taken already is to provide a much greater range of incentives for doctors to go to and to stay in rural and regional centres. In fact, I think we've increased the number of doctors who are eligible for those support payments up to about 2,500 across the country now, and expanded the number of areas which will be included in that as well. That's one thing.

But you know, underneath it all, what the problem is - not enough overall supply of GPs in the first place. And if we increase the supply of GPs nationwide, we will make a huge step forward to dealing with the problem. Right now the projection is that if we don't take action, just to maintain things as they are, we'll need an extra 3000 GPs in the decade ahead. However, we need to improve where we are at the moment. That's why we're aiming to deliver 5,500 new GP training places for that period, because we need to expand in particular what's available in rural and regional Australia.

HOST: Rural GPs say this isn't going to be enough, and that's what required to get GPs to the bush is a lot more money. Is that going to be available?

PM: Well, can I just go for example to the general practice rural incentives program, which the Government has introduced. And that is designed specifically to assist with location grants over a period of time. For example, $4000 in the first six months, $6000 in the first full year, $8000 in the second year, $13000 three to four years on, $18000 five years plus. Put that together, it starts to add up to a sizeable amount of money.

We are always open to further ideas about how we provide incentives in rural and regional areas. This is a program which we are proud of, which we believe will help in areas which currently have an undersupply of doctors. But I keep going back to my original point. You can provide as many incentives as you like- unless you have an overall adequate supply of GPs coming through the system, it simply won't work. And what we've done with this 5,500 additional training places for General Practitioners is extend that out much more extensively into rural and regional Australia.

We can't simply accept business as usual with the health and hospital system. Something has to change. We've put forward a plan for change, a new national health and hospital network, funded nationally, run locally, the first time the Australian Government becoming the dominant funder of the Australian public hospital system. But we need more doctors as well.

HOST: Mr Rudd, you've said you'll use private hospitals and general practices to help train some of these medicos. How will that work?

PM: Well, we'll simply enter into the appropriate arrangements on the ground. You know, right across rural and regional Australia, you have different mixes of private and public services. But we will simply tailor those to the circumstances on the ground. We think that's the right and the practical way to go. We are strong supporters of the public health system, the public hospital system. But where we need to engage and create a partnership with private hospitals, we'll do so as well.

HOST: Mr Rudd, I noticed one of the doctors when you were visiting Queanbeyan Hospital yesterday mentioned that you need to take a look at the Cuban health system. Have you had an opportunity to find out what's so good about the health system in Cuba?

PM: Yeah I sort of let that one go through to the keeper. I just mentioned in passing that I think there's a few problems with things like political freedom in places like Cuba. But it's a rich and diverse country we have in Australia. We're always open to ideas from everybody, but I think we might just leave that Cuban model to one side.

What we're concerned about is just not accepting the continuation of things as they are in the health and hospital system for Australia. That's why we've put together this bold new plan, funded nationally, run locally, and for the first time the Australian Government becoming the dominant funder of the public hospital system of Australia.

HOST: Can I just take up on that funded nationally, run locally point? Because one of the big problems in Queensland is a shortage of doctors and nurses, and employing doctors and nurses is one of the areas that you're still leaving up to the state Governments. So, surely that's not going to make any difference to the quality of healthcare?

PM: I think there are many parts to this. The first and fundamental one is how do you get rid of the game of cost-shift, blame-shift and waste and overlap and duplication between the two levels of government. Our response to that is as follows. For the first time the Australian Government becoming the dominant funder of the public hospital system. Its recurrent needs, its capital needs, its equipment needs, its teaching and training needs. That hasn't been the case ever in Australia's history.

And secondly, to become the exclusive funder of what's called the primary healthcare system, health services delivered outside of hospitals. If you do that, then, in terms of the mindless game which occurs and has occurred over many years between the two levels of government about who's responsible for what, frankly, we take the underpinnings away from that.

Secondly, you've still got to have, however, personnel to run the system. That means more doctors, more GPs, more specialists, more nurses, and what we have made clear in our announcement today is that we're not simply restructuring, refunding the national health and hospitals network- we're actually investing new money in the provision of more than 6000 new doctors and GPs and specialists over the decade ahead. That's what makes the difference. And we, the Australian Government, are responsible for ensuring that we've got a proper supply of GPs nationwide.

HOST: Mr Rudd, The Australian newspaper is reporting that your approval rating is at its lowest since 2006. Are you concerned by that in an election year?

PM: You know something- the key things that Australian working families expect of me is to keep my sleeves rolled up and delivering on the basics. And that means health and hospitals. And that means making sure we get on with the business of reforming the system and delivering better health, better hospitals. More hospital beds, more doctors, more GPs, more nurses, more specialists.

On the question of the upcoming election, as I've said for a long, long time, when an election is held it's going to be very tightly-fought. It'll be a hard-fought election. And I expect that. But I will simply continue in the business of ensuring that we are keeping the economy strong, protecting jobs, protecting the jobs of working families in North Queensland. But you know something, it'll be a tough fight, and that's what I fully expect come election time.

HOST: Kevin Rudd, thank you.

PM: Thanks for having me on the program.
 

MITCHELL: Mr Rudd, good morning.

PM: Good morning, Neil. Thanks for having me on the program.

MITCHELL: Well, thank you for your time. Mr Rudd, President Obama's here in a couple of weeks. Will you be recommending he becomes a Companion in the Order of Australia, as did the Indonesian President?

PM: The reason we've provided this to the Indonesian President is following on a precedent which was established by my predecessor, Mr Howard. He provided an honourary Order of Australia to the former Prime Minister of Singapore. President Yudhoyono, in his previous life, helped a lot in the response to the Bali bombings in 2002 and has done a lot, also to entrench democracy in Indonesia, so we thought this was an appropriate gesture to him.

MITCHELL: Is President Obama in line for one as well?

PM: Not so far as I'm aware, Neil.

MITCHELL: Well, it's your call, isn't it?

PM: Well, it is, but we are very mindful of what President Yudhonoyo has done over a period of nearly eight or 10 years now.

I mean, the Bali bombings went very much to the hearts and lives of many, many Australians, many, many Victorians, and his role, then as Coordinating Minister for Security, in responding to that tragedy, rounding up the terrorists and dealing with them, I believe was worthy of that recognition, together with his role in entrenching democracy in this vast, populous and important neighbour of ours, so that's the reason.

MITCHELL: President Obama's got a Nobel Prize. Maybe he doesn't need one.

PM: Are you in the queue for one, Neil?

MITCHELL: No, I'm an AO.

PM: No, I mean a Nobel Prize.

MITCHELL: Oh, I doubt that very much. The insulation disaster -

PM: - You and me together.

MITCHELL: - looks like costing upwards of $500 million. Hot water systems are being thrown at country footy clubs that don't need them, schools are getting new buildings at four or five times what the buildings should cost. Do you have any idea what this bureaucratic incompetence is going to cost the taxpayers in total?

PM: Well, let's put it in a bit of context, Neil. In responding to the global economic crisis, the Government introduced a national economic stimulus strategy. Our intention was this, and it's been realised: to keep the economy going, to prevent the economy going into recession and to protect hundreds of thousands of jobs.

MITCHELL: But that's not the argument - the argument's efficiency and waste.

PM: No, no, I'm going on -

MITCHELL: - But nobody's arguing about stimulus, they're arguing about, you know, $900,000 for a school building that should have cost $200,000, what, 17 hot water systems for a country footy club that's only got 16 players.

PM: On the implementation of various programs, of course there are going to be problems which have arisen and we have acknowledged those on the way through and we are dealing with them on the way through -

MITCHELL: - What's the total cost of the waste?

PM: The one that you just mention in relation to the heat pumps, the solar pumps, that was a program, actually, which existed, I'm advised, prior to this government taking office. The loophole which was identified in the program was closed in September of last year, and as I've said, anyone abusing programs like that will be met with the full force of the law.

On the question of the schools that you just referred to, we have a huge number of projects out there across 9,500 schools. The overwhelming majority of them are going really well. It follows logically that from time to time problems are going to arise. On the details of the school that you just referred to before -

MITCHELL: - I've got three. I've got one that's cost $931,000 for a library, another that's cost $850,000 for a two-room classroom and another that's cost $200,000 to move a sewer and stormwater drain, all outlined in The Herald-Sun today. I mean, it's just massive waste.

PM: Neil, right across Australia we have 9,500 schools currently benefitting from this program - every primary school in Victoria. And many schools, for the first time, are getting purpose-built libraries, they are getting, for the first time, improved classrooms, for the first time many secondary schools are having access to state-of-the-art language centres -

MITCHELL: - Prime Minister, that's not the argument. The argument is the waste. The argument is not that they need a library and should get one, the argument is that they're paying, you're paying, we're paying, five times as much for that library as we should. It's a waste of the stimulus.

PM: Neil, in response to any problem which arises in implementation, what the Deputy Prime Minister and Education Minister, Julia, has done, is deal with each case in its circumstances to make sure that it's dealt with.

If you're going to roll out a program like this, which, for your listeners has meant a huge amount of work for tradies right across Melbourne last year when the bottom was falling out of the economy, providing jobs for sparkies, for carpenters, for bricklayers, that was the economic driver of what the Government did.

Obviously, problems will arise, from time to time, as they do with any construction project. What the Deputy Prime Minister has done or has sought to do in each case is deal with each problem as it arises.

MITCHELL: But that's my question. You put together the insulation mess, upward of $500 million, you put it together with the other waste in the schools, how much have we wasted?

PM: On the implementation of these programs, obviously in the case of the insulation program there have been real problems. That is being dealt with now by Minister Combet.

MITCHELL: How much will it cost?

PM: Well, what I'll say in response to that, Neil, is that the options we've provided for people in the case of foil insulation is to either have that insulation removed or for a switch to be installed. Now, the -

MITCHELL: - Well, that applies to foil, yeah.

PM: So the cost, therefore, that will arise from that will depend on the choices made by the individual householder. Secondly, we will also meet it within the overall funding which has been allocated for the original program. That's what I'd say in response to that.

MITCHELL: So how much is that?

PM: Well, as I said to you before, it will depend on the choice which individual households make between those two options. So, we accept responsibility for the problems with implementation, but I go back to my point -

MITCHELL: But that's only a small part of it, Prime Minister. What about the pink batts? I mean, in Sydney overnight there's another house fire linked to the insulation. We've had many in Melbourne. Are all these people going to be compensated? What is this going to cost? This is a problem unequivocally caused by your Government.

PM: Well, each of the individual circumstances has to be examined in terms of the cause of a particular problem. You know that it differs from case to case.

Of course, what the Government has said is we accept responsibility for the problems arising in the implementation of the scheme and we will deal with each of these on the way through -

MITCHELL: And do we know what it's all going to cost, all together? Do we know? Have we got a budget for it?

PM: Well, can I say in relation to the program you're talking about, what we have indicated is that we'll meet that within the framework of the budget which is already outlined. Secondly -

MITCHELL: So how much is that?

PM: Well, the program for insulation was originally announced as something in the vicinity between $3 billion and $4 billion over several years. These adjustments will be accommodated within what has already been budgeted for the program.

The other thing I'd say Neil, though, is that stepping back from the detail of each program, and you're right to be critical of any waste which occurs, I don't pretend that I'm happy with that at all, but we need to deal with each of these problems as they arise.

What I would also say, though, more broadly, to you and to your listeners, is that in dealing with these challenges we've also been dealing with the much broader challenge which was presented to our economy when every other economy, major economy, around the world went into recession and millions of people lost their jobs. We currently -

MITCHELL: Yeah but Prime Minister -

PM: We currently, Neil, have the second-lowest unemployment level of all the major advanced economies, and that's partly because government stepped in and stepped into the-

MITCHELL: But Prime Minister, we're not talking about the stimulus. We're talking about how much of the stimulus was actually wasted and could have been spent in another way, could have been spent better. Do you still consider yourself a fiscal conservative with all this?

PM: Neil, the responsible course of action in the face of a global economic crisis which is sending hundreds of thousands of people out of work is to step and to make a difference -

MITCHELL: It is not to waste money, Prime Minister, in a ridiculous way. I mean, seriously, $900,000 for a school library, which you could have built for - I could build a mansion for $900,000.

PM: Well, Neil -

MITCHELL: Well, a big house.

PM: Well, I'm not quite sure where you live Neil, so I couldn't comment on that.

On the individual circumstances concerning each school, what I know what Julia Gillard has done, the Education Minister, is intervene as each particular problem has arisen.

And can I say, if you have 10,000 schools across the country and the vast, vast, vast majority of these projects have proceeded well, can I say this is actually a great addition to the next generation of Australian's educational opportunities.

MITCHELL: At any stage will you sit down and work out how much has been wasted and tell us?

PM: Well, of course, the Auditor-General will go through all of these things appropriately with a fine tooth comb, and that is why we have a system of Government which is designed to do that.

The alternative, Neil, as recommended by our political opponents as the global economic crisis hit - do nothing, and therefore, for hundreds of thousands of your listeners to find themselves out of a job. We were not prepared to do that. We accept responsibility for any problems, however, of implementation on the way through.

MITCHELL: Well, what about, we've got a house fire overnight believed to be caused by insulation. We've got over 100 around the country. What do you say to somebody sitting in Melbourne today with insulation that's been put in their roof and they don't know whether it's dangerous or not? They don't know whether their house is going to catch fire or not? You put it there. What do you say to them?

PM: Well, in response to any concerns which any member of the public has, what Minister Combet has established is a range of services for the public which they can quickly access. Any general inquiries -

MITCHELL: Not quickly. It can take months, if not years, Prime Minister. Years. You can sit there with this stuff in your ceiling for years.

PM: Neil, can I answer your question, which you put to me, which was what can members of the public do? Firstly, they should go to a general inquiries number on 1800 808 571. If you are concerned about safety, on 131 792, and that deals with both foil and non-foil -

MITCHELL: And when will they be inspected?

PM: In terms of the schedule for doing that, the details of that are being resolved by Minister Combet -

MITCHELL: We don't know, that means, Prime Minister. That answer means we don't know, and they're sitting with, 1.1 million houses, potentially, sitting there worrying about it, and we don't know when they'll be inspected.

PM: Neil, based on the initial survey of households out there in the community, the conclusion so far reached by the officials is that 92 per cent of those houses which have had insulation installed do not have any safety-related problems -

MITCHELL: Prime Minister, why should we trust them? They're the people who put it there. These are the very people who implemented the system, and now we're supposed to trust them when they tell us it's safe.

PM: Neil, what we do is we act in response to the information that we receive based on surveys and inspections of what has occurred on the ground. We will do this step by step.

The other thing I'd say Neil, to put this into context, is that when it comes to safety-related issues for insulation in ceilings, these pre-existed the implementation of this program as well. For example -

MITCHELL: House fires have increased dramatically Prime Minister. Ceiling fires have increased dramatically.

PM: The advice that I've received -

MITCHELL: Dramatically.

PM: - is that in 2008, prior to this program being implemented, there was something in the order of 80 or 85 fire-related incidents associated with insulation. In that year, there were some 60-70,000 insulation installations occurring across the country.

What we have had since then is a very large increase in the overall insulation program nationwide. My overall point to you is there have always been a degree of -

MITCHELL: But there's also been a significant increase in ceiling fires.

PM: Well -

MITCHELL: A very significant increase. In Victoria I think it's almost tripled.

PM: Well, the information that I have related to prior to 2008 - and I go back to my overall -

MITCHELL: But that's irrelevant. These are the things that have been put in our houses since under your scheme. Are you denying that there've been ceiling fires, a massive increase in ceiling fires caused by this insulation?

PM: Neil, what I've said is that plainly in the case of the implementation of this program there have been real problems.

I'm also saying to you that prior to 2009 there were also a proportion of homes which had safety-related issues arising from insulation.

And right now, as I'm advised by officials, the rate is something like a fire-related matter is something like 1 in 10,000 homes. Well, we will deal with each of these as we should. And we'll -

MITCHELL: Do you accept that the ceiling fires have increased significantly because of the insulation mess?

PM: We are dealing with the data as it comes in Neil. And we will deal with this systematically and properly, as I'm sure you would expect -

MITCHELL: Okay.

PM: - and we will deal with it step by step, house by house. Minister Combet has put in place a program to ensure that all those who have foil insulation will have their households inspected. Secondly -

MITCHELL: We didn't even know yesterday we've had live ceilings found in Victoria. That's how much your bureaucrats are across this. Didn't even know.

PM: - Secondly Neil, that what he's indicated is that in the case of each of those households, they'll be offered the option of either having that foil removed, or a switch installed. That is the appropriate course of action.

As I've said before, the Government accepts responsibility for any problems which have arisen with the implementation of this program. That is the right thing to do. And again, I make the overall point - the Government, in seeking to implement its overall stimulus strategy, was dealing with the huge challenge represented by the global financial crisis. Obviously, problems have arisen, we accept responsibility for that as well.

MITCHELL: Do you accept, as the Treasurer said, that there may have to be spending cuts because of the amount of money wasted?

PM: In terms of the matters that you've just been raising concerning insulation, they'll be met within the already budgeted amount of money for the program. There will be no increased allocation at all.

MITCHELL: Okay, what about other things? Will there need to be spending cuts because of them?

PM: In relation to the other programs, we have no information before us which causes us to believe that we have any budget problem arising with them at all.

Remember, remember it is very easy across 10,000 school projects across the country to point to individual problems here and there. These will be dealt with on the way through.

I would simply say to you Neil, ask your local P&Cs, P&Fs, parent bodies right across the state of Victoria, what they think about having new classrooms, new school libraries, new multipurpose halls, new language centres, new science centres - I think you'll find there's a lot of positive response out there in the community. I know that there -

MITCHELL: I'll pursue that. I'll pursue that.

PM: Well -

MITCHELL: I'm happy to pursue that. Can you guarantee there will not be tax increases in the budget?

PM: Can I say Neil, our position prior to the election, and since the election, has always been this - we will not increase tax as a proportion of gross domestic product compared with that which we inherited from the previous Government in 2007 -

MITCHELL: Does that mean there won't be tax increases?

PM: As I said Neil -

MITCHELL: For some individuals? I mean, you might, you talk about an overall grab. What about for individuals, or companies?

PM: Neil, our position is economy-wide. We've said that time and time again. You and I have discussed this on air a thousand times before as well. My position hasn't changed. And we won't violate that. We certainly won't be the same high-taxing Government as the one which preceded us.

MITCHELL: Okay, you're saying the overall tax take won't change. But is there going to be a reshuffling of the way it's collected?

PM: Well Neil, obviously we're considering the recommendations for the independent tax review. But our overall discipline remains, we will not increase the overall tax burden on the Australian economy. That is the right way to approach it. And that is a principled approach.

I note my political opponent said on your program six weeks ago that he would not increase taxes. And six weeks later he fundamentally breached it -

MITCHELL: I agree. That was wrong.

PM: - with his great big new tax on everything -

MITCHELL: Okay, but you've had a bit of a -

PM: - I've been very clear on my position-

MITCHELL: - You've had a bit of a habit of taxing the rich, you're talking about the overall take here. Will you be changing the tax on the so-called rich?

PM: Well, I'll simply repeat our position Neil, and that is that prior to the budget and prior to our response to the independent review of taxation, we have nothing further to say on that, because we'll have to consider all the relevant options.

But the key thing is this - do not increase the overall burden of taxation on the Australian economy, and it won't be in aggregate terms any higher which our predecessors had.

MITCHELL: Prime Minister, just to - this might be helpful in the fire discussion - January to June 2009 in Melbourne, there were seven roof fires caused by insulation, the pre-insulation days, seven roof fires caused by various things. July to December 2009, 31 roof fires. This year, more than 15 already.

PM: Well, I'd go back to the figures that I referred to before. There were obviously fire-related events prior to 2009. In that year, I'm advised Neil, these are the figures I've been presented with, that some 60-70,000 insulation installations would occur in a given year. That has increased -

MITCHELL: Prime Minister, they've tripled in Victoria. Roof fires. Since you introduced this scheme, they've tripled.

PM: I was about to add to what I was just saying before Neil, is that in the period 2009-2010, the total number of installations across the country went from 70-80,000 of course to 1.1 million. Right now, the advice that I have is that you have a fire-related event for one in every 10,000. We will therefore monitor this very closely. And we will therefore deal with each individual circumstance as it arises.

MITCHELL: Meanwhile we live with it.

PM: Well, there are problems that we have had to deal with, and we will deal with the practicalities on the ground as we go through.

MITCHELL: I know you need to get away, one final question, and a quick one. About a month ago we talked about the kids out at Terang, under your new laws they're required to work three hours a day under the Award. They can only work an hour and a half because they're leaving school. They lost their jobs. More kids have lost their jobs. You had Work Fair Australia on to it. Nothing's changed. More kids have lost their jobs this week. What are you doing?

PM: Well, on that I'll take that question on notice Neil, I don't have those facts before me. But I will come back to it when we next speak on air.

MITCHELL: When will you release -

PM: - The reason I have to go now, by the way, is that I'm talking to the New South Wales Premier.

MITCHELL: I'm sorry. I'll let you go.

PM: That's fine.

MITCHELL: One question, when will the tax review be released, the Henry review, when will you release it?

PM: We'll sort that out in our own due season. I was asked yesterday whether it would be released before the next election. Yes, that of course will be the case. But we need to make sure we get it right.

I notice by the way that some of the Premiers, including the Victorian Premier, are saying that they can't provide a substantive response to their position on health and hospital reform until they have seen the Government's response to the Henry review or the Henry review being released. Can I just say this? There seems to be a different excuse every day as to why various state Premiers can't take a position on whether they're going to support national health and hospital reform.

And secondly, on your program, let me say this. In response to the independent review of taxation, no individual state will be worse off as far as that plan is concerned.

Therefore, let's put that to one side, get on with the business of health and hospital reform, which the good people of Australia want.

I'm seeing Premier Keneally in New South Wales right now. I'm seeing Premier Bligh in Queensland tomorrow. Premier Brumby wasn't able to see me in Victoria today. I understand he's free at 2pm on Sunday, I'll be flying to Victoria to see him on Sunday as well.

MITCHELL: OK, very final question, the Reserve Bank's accused the banks of gouging on interest rates, gouging extra money unfairly out of homeowners. Do you agree?

PM: The Reserve Bank is absolutely right. They are. And in response to that, watch very closely the impact of the new credit laws which the Government is bringing into force this year.

MITCHELL: Thank you for your time. I didn't get to ask you how you lost weight.

PM: Sorry?

MITCHELL: Everybody tells me you've lost weight. How'd you do it?

PM: I use a, you know, gym equipment, you know, I keep, you know, watching what you eat and you use the gym and all that sort of stuff.

MITCHELL: You could sell the diet to Woman's Day.

PM: Well mate, how's yours going?

MITCHELL: Not good. Not good, but I'm trying. Thank you very much for your time.

PM: Good to be with you Neil.

KOCH: Kevin Rudd, good morning to you.

PM: Good morning Kochie.

KOCH: The Reserve, this report says the banks have added an extra quarter of a percent, particularly to home loan borrowers and small business customers. Can you do anything about it?

PM: First thing is the Reserve Bank is right. The banks have been gouging. That's the bottom line here.

What are the practical things that we have been doing and we can do more about? One is that for the smaller non-bank lenders, what we've been doing throughout the financial crisis is provide them with a continuing source of credit, some $16 billion worth, to keep them afloat as competition opposed to the banks.

KOCH: Yeah.

PM: That has been very important, because we were very worried that some of those smaller lenders would, frankly, go to the wall during the crisis. So that's one thing. The second is, this year there'll come into being a whole new bunch of credit laws, tough credit laws, which will enable the regulators to crack down on gouging, across the financial sector. And this will be an important change for the year ahead.

KOCH: So not only banks, but superannuation funds, the whole lot. Could they go to the banks and say guys, no, you're not putting up your rate?

PM: Well, on the operation of the laws, you know we have independent courts and their independent processes, but the regulators will now have new powers to step in.

Of course, there's one third thing as well, which is, right now, the best thing customers can do is actually walk with their feet, and we have brought in bank switching arrangements which enable you to do that without huge walls of resistance now from the banks. As you know, they can often make it really hard by saying 'well if you exit, you've got these fees to pay, that fee to pay'- we've now made that much easier. And they have a legal obligation to make it possible for you to pull your money out of that bank.

KOCH: Excellent. Okay, we might follow that up with details of where people- of websites people can go to, to find out how to do it. Alright, let's get in to our viewer questions. Rachel Murphy is from Darwin, Rachel, you have the ear of the Prime Minister. What do you want to ask him?

PM: Hi Rachel.

MURPHY: Good morning Kochie, good morning Mr Rudd. My question to you is, why minor dental is not subsidised by Medicare?

PM: Okay, good question about dental care. Have you got kids yourself, Rachel?

MURPHY: Yeah, two.

PM: Okay, how old are they?

MURPHY: Three and five.

PM: Okay. Well, here is one thing we've done for when they get a little bit older. For the first time, we have implemented- delivering on a commitment we gave before the election- what's called a teen dental program, which means that from the ages of 13 to 18, we'll provide up to $150 a year for eligible families, usually those on under about $120,000 a year to get a teen dental check-up. That's because, as you know, kids' teeth change a lot in those years, we want to make sure that we're acting preventatively as early as possible.

But as for littlies like that, I wish I had something additional to say to you, but I don't, other than our continued support for private health insurance in these circumstances as well, and there is a rebate which is offered.

KOCH: Okay.

MURPHY: I do know that the children get it through the schooling, but, just like, adults, you know, like getting- why is it that when you go to the doctors you get a rebate from Medicare, whereas dental you don't get anything from a check-up to a clean? I know that major dental would be quite expensive for them to subsidise, but what about just a preventative measure for adults as well?

PM: Well that preventative measure we've brought in is the first one in Australia's history, and that copes with kids who are teenagers, 13 to 18. We've currently expended some hundreds of millions of dollars on that, and from memory, I think we've- in the first two years of its operation- we've provided, well, nearly one million services across Australia. You raise the point about littlies. Frankly, there's a limit to how far the budget can go on these things.

One other thing we're trying to do on dental, though, is to reintroduce a Commonwealth dental scheme for older Australians who are waiting now on public dental waiting lists, and that is currently being blocked in the Senate.

I wish I could say I could fix all these problems. We can't. One of the proposals put forward to make a system like Denticare come into existence would cost, on their estimates, some $4 billion a year- that's a lot of money. We're trying to do this step by step. When they get to 13, I can do something for you. Right now, it's private health insurance, and what you can get through the schools.

KOCH: Alright Rachel, thanks for that. Now next is Evan Kourambas from Melbourne, Evan, go ahead.

KOURAMBAS: Good morning Prime Minister. My question is about your recent announcement on your intentions to take over funding and operational control of our public hospitals. And furthermore, you announced that if you couldn't get this through Parliament, you're prepared to take it to a referendum. My question is, if state Governments are not capable of running hospitals- number one, what are they capable of running, and secondly, should the referendum question be do we actually need state Government?

PM: That's a good provocative question for this time of morning, Evan. Thank you for asking it.

KOURAMBAS: Thank you.

PM: You know something, for our proposal on health and hospitals, it is big, and it affects, frankly, mums and dads and families right across the country. What we are saying is, a national health and hospitals network, funded nationally, run locally, and for the first time the Australian Government taking dominant funding responsibility for the public hospital system.

Now to the core part of your question, which is why are we doing this with the States given their other responsibilities, here is the key fact. Right now, if we don't make any changes, the health budgets of the states and territories will swamp every other thing that they've got to do within the next twenty or thirty years.

In fact, here in New South Wales where I am at the moment, the Premier told me not long ago that in about 25 years time, their state budget would not have a dollar to spend beyond health and hospitals in terms of the revenues that they themselves raise. We've got to fix this system. And part of the reason we are stepping in, which goes to the other part of your question, is so that we can free up some of the funding for the states and territories to attend to things like transport, infrastructure, schools, law and order, rather than just beating a path to our door for every problem known to man.

KOCH: But Evan's saying should we get rid of the States? Why don't you give us a vote on it?

PM: The key thing is to deal with the health and hospitals system, I think that's what people are worried about most. This is a vast country. For your viewers in Western Australia today, seriously, viewers in Western Australia, viewers in Queensland, a long way from Canberra, a long way from Sydney, and Melbourne where you are Evan, they have a slightly different view about the importance of the federation and state Governments having a continuing role. My job's to make sure they've got the money to do so. And if we don't fix health and hospitals, it's really bad for mums and dads out there, and it's really bad for the future of the ability of the states to fund other services.

I'm seeing Premier Keneally today in New South Wales. We're determined to get as much cooperation from the states and territories as possible to push this reform through.

KOCH: She's got the worst hospital system.

PM: It's not flash.

KOCH: They can't run a chook raffle. Alright, you've got some homework on superannuation for stay at home mums.

PM: Sorry, you caught me in mid-swig. The- I've been doing a bit of homework on the stay at home mums. Can I give you a few points on this one?

KOCH: Yeah, sure.

PM: Firstly- and this was from Naomi I think, no, from Sonia, I got this one- superannuation splitting.

The partner of a stay at home parent can split their concessional superannuation contributions with their spouse, okay. People need to be aware of that, so that the stay at home spouse can also accumulate their own superannuation fund that way. Secondly, the partner of a stay at home parent can get an offset of up to $540 of their end of year tax if they contribute to the superannuation on behalf-

KOCH: And that's the spouse contribution scheme.

PM: That's right.

KOCH: Which is pretty attractive.

PM: The third thing is, of course, stay at home parents can have their own non-concessional superannuation arrangements. They can actually build that up over time. And finally, if the stay at home parent does some paid work during the year, he or she may receive a superannuation contribution if they also contribute to their own super. So there are three or four specific things there, and again go to the Government's super website about those particular contributions. We make it a little easier for stay at home parents to accumulate their own superannuation.

KOCH: Terrific. Thank you for that, good to see you.

PM: Appreciate the time.

DELANEY: The Prime Minister of Australia, Kevin Rudd. Good morning.

PM: Good morning, thank you for having me on your program.

DELANEY: How are you today?

PM: Really well, thank you.

DELANEY: Well, this is obviously a signature reform that you're hoping to take to the next election, but at the same time that's given rise to some criticism that it is nothing more than an election stunt. How serious are you about achieving meaningful reform ahead of the election?

PM: Well, the first thing I'd say is that in the two years that we've been in office so far, the Australian Government has increased its funding to the States and Territories for Australia's public hospital system by 50 per cent - five zero - up to something like $64 billion.

We've also increased the number of GP training places already by 35 per cent, and we're also investing some $3 billion-plus into the hospitals and medical research infrastructure of Australia, including a record investment of more than $1 billion in new integrated cancer care centres right across the country. So if people ask 'well, what have you been doing for the last two years', that's what we've been doing.

Now, for the future, the long-term future, what the Government did two weeks ago was launch its plan for a new National Health and Hospitals Network for the future, funded nationally, run locally, and for the first time the Australian Government becoming the dominant funder of the public hospital system of Australia. That wasn't the case before.

So, for the first two years we've been providing extra resources, significantly, into the system. Now, for the long-term future, we've put forward this plan because we cannot simply accept the hospital and health system as it is at present.

DELANEY: You've proposed a 60-40 funding split. How does that end the blame game? As long as the States have a financial stake in affairs they'll also demand some sort of input into decision making. Once again, there's the opportunity for finger pointing, isn't there?

PM: We think the fundamental change here is as follows: in the past, the Australian Government was only responsible for about 35 per cent of what's called the recurrent funding of our hospitals - effectively, what it costs to run them each year. For the first time, we increase that to 60 per cent and become the dominant funder for the first time in the country's history.

In the past, the Australian Government was responsible for none of the capital needs of our hospital system. That is, none of the building costs, none of the equipment costs, none of the costs, for example, you know, PET scanners and the modern, state-of-the-art equipment which we need right across the system, and now we increase that to 60 per cent to become the dominant funder.

And, finally, for the teaching and training costs of our public hospital system to train properly our nurses and to train properly our doctors within our major public hospitals, we take on that dominant funding responsibility as well. In the past, we did nothing.

So, when you put all those things together, this is a big, fundamental reform.

We become the dominant funders. But on top of that we become the exclusive funders of health care delivered outside of hospitals.

And so many of the problems in the past have arisen because of the brawls between what happens outside of hospitals, where the Federal Government has an historically strong role through Medicare, and what happens inside hospitals.

Now we become the exclusive funder of one and the dominant funder of the other. Therefore, the opportunity for cost shift, blame shift, is reduced hugely.

DELANEY: By re-directing 30 per cent of the GST from the States, aren't you robbing Peter to pay Paul?

PM: What we're doing is making sure that those funds, on average about one-third of the GST, are dedicated to a new National Hospitals Funds.

From that new National Hospitals Fund, we will provide funding and investment for the future expansion of Australia's public hospital system.

But secondly, when you look to the future, at present the health and hospitals budget of the States, on average, is growing by about 11 per cent a year. The GST is only growing by about six per cent a year. That gap is huge, and if you want to know one of the reasons why the system is under such stress at the moment, it's because of that gap.

Now, what we, the Australian Government, are doing is taking on responsibility for funding that growth gap in the future as well, something which the States and Territories would find impossible to do by themselves.

So when you talk about the future funding arrangements between the two levels of government, firstly, we're dedicating that to a new National Hospitals Fund, that one-third, on average, of the GST.

But secondly, we, the Australian Government, are taking on more than $15 billion of additional growth on the hospital system in the decade ahead because of that growth gap between the GST and current State outlays on health.

DELANEY: Are the States right to express concern about the possible interplay between this change to the GST and whatever might be contained in the Henry review of taxation?

PM: No, not at all, and the reason is I've said quite explicitly, on the record and to the Premiers who've asked me about it, that under no circumstances will they be in net terms worse off as a result of any changes to the taxation system which arise in response to the independent review of taxation. So that argument, frankly, is just not relevant, and we can't use that as a reason to delay action on our health and hospital system.

DELANEY: But as long as you're keeping the Henry report to yourself, you're asking people to take you on faith on that point, aren't you?

PM: As far as the States and Territories are concerned, the fundamental maths that I ran through before remain constant. That is, you look at how their hospital budgets are growing at present - 11 per cent per annum- you look at how much their GST is growing at present - six per cent per annum. Someone's got to shoulder that gap. We're putting up our hand to do that, and on top of that to grow the system further.

You know, if we didn't act on this, health and hospitals alone, it has been estimated, will totally swamp the State budgets of the States and Territories over the next 20 to 30 years. That is, they would be incapable of using their own source revenue for funding anything else - that is, schools, law and order, transport, the other things that State Governments are responsible for doing.

In fact, what we're doing through this reform is assisting them in freeing up some of their resources for these other priority areas while we take on the lion's share of the burden for the health and hospital system.

DELANEY: It's a big challenge, isn't it, to get all the States to sign on, to agree to all of the details of your proposal, especially when we don't even know what all of the details are as yet?

PM: Well, we have released something like a 75-page blueprint called the National Health and Hospitals Network, funded nationally, run locally, for the first time the Australian Government being the dominant funder of the system. That was released nearly two weeks ago and there is a lot of information within it.

What I did yesterday was also make a further announcement with the Health Minister, Nicola Roxon, on our new investment in the doctors we'll need as the life blood of this new system over the decade ahead.

This is a most significant announcement - that is, that we would deliver over 6,000 additional doctors over the coming decade through a $632 million investment: 5,500 new or training general practitioners, 680 medical specialists and more than 5,500 positions for junior doctors within hospitals as well.

But one of the key things is this: with these medical specialist positions, there'll be a large concentration of those in rural and regional areas. Similarly, with the GP training places, because in rural and regional Australia there are simply not enough doctors, there are not enough specialists, and we have to fundamentally change the system to make sure it's turned around.

DELANEY: But if you don't get the agreement of all the States, everything falls down, doesn't it. What's your plan B?

PM: Well, what I've said consistently is as follows: if we can't get agreement from the States and Territories on the proposal that we've put forward, then I have said we would go to the people and seek a further mandate for the Australian Government to obtain all the power necessary to bring about these reforms, including moving to 100 per cent funding responsibility over time.

That's what I've said from the beginning. That's what I said prior to the last election, that's what I've said consistently since then. So if the States and Territories do not agree with what we're putting forward, then that is what we would do, and that I believe is the most sensible course of action.

DELANEY: You've been criticised for having failed to meet the timetable, the original promise to arrive at this point by the middle of 2009. Was it more difficult than you anticipated?

PM: Well, there was something called the global financial crisis last year, and while that's not an excuse for being about seven or eight months late in producing our plan, I've got to say it did put a lot into our in-tray.

You see, our job as the Australian Government was to keep the economy strong, to protect the jobs of hundreds of thousands of Australians during the worst global recession since the Great Depression, and to keep Australia out of recession, which we did, when practically every other advanced economy in the world went into recession.

That was our main task last year. At the same time, we were developing our plan for long-term reform of the health and hospital system. We released that about two weeks ago. We've got a Council of Australian Governments meeting coming up in April. As I said, if we reach agreement on that, then that's our blueprint for the future. If not, then we'd be seeking a further mandate from the Australian people in order to implement that blueprint because we believe that's the right way for the future.

DELANEY: In reference to the global financial crisis and the Government's response to that, in big picture terms certainly most observers agree that that has been successful, but in the detail it's been quite an embarrassment for the Government in terms of the insulation debacle and various other allegations of wasted money and no long-term benefit to show for the money spent.

PM: Well, let me just go to the economic impact first of all. The Australian economy has been the only one of the major advanced economies to actually grow in the 08-09 period. That's just a fact.

Secondly, we've generated the second-lowest unemployment.

Thirdly, we've done so with the lowest debt and the lowest deficit, and finally, we've done so without falling into recession, which occurred practically in every other advanced economy in the world.

What's the practical consequence of that for your listeners? Hundreds of thousands of jobs for working families protected, which would otherwise have been lost through people being forced onto the unemployment queues, with huge consequences for families, for kids, and for the general economy as well.

That's what we did, and that's why we're proud of our national economic stimulus strategy.

Secondly, you talk about the impact of that strategy over time. If your listeners were to go and talk to their local schools and their local P&Cs, their local P&Fs, right across the country and ask the question: 'What is being built at my local school at present? Are we getting a new library, are we getting new classrooms, are we getting a new language centre, a new science centre, are we getting a new multipurpose hall for the first time in this school's history?'

Some 10,000 schools across the country are benefitting from these sorts of programs - government and non-government, rural, regional, metropolitan.

And so when we look back in a decade's time with kids now having built in their schools, for example, state-of-the-art, 21st century libraries, I believe this is a good legacy for the future.

DELANEY: Yes, but in practical terms the delivery of the home insulation program was a disaster and an embarrassment for the Government, and people are saying things like if they can't deliver insulation, how can they deliver on health reform?

PM: Well can I just answer that - that is, we have said quite upfront that there've been real problems in the implementation of the insulation program. And what we're doing now through Minister Combet is seeking to deal with each of those problems as they arise. Remember, also, in implementing a massive national economic stimulus strategy to prevent the Australian economy from falling into recession, we had to work and work very hard.

The second thing I'd say, though, is this, and you made a reference to the reforms for the health and hospital system - this health and hospital system we propose is to be funded nationally and run locally.

As I've said consistently, the big problem in the system at present is there are not enough funds dedicated to it in order to provide enough doctors, enough nurses and enough hospital beds. That's why for the first time in the country's history you've got the Australian Government stepping up to the plate.

But secondly, a system that will be run locally through local hospital networks right across the country. We don't want state bureaucrats or federal bureaucrats running local hospitals. What we want are local clinicians, local doctors, local nurses, local finance experts, local management experts through local hospital networks actually running the delivery of local hospital services.

So we believe we've got this balance right - funded nationally but run locally, and this is the reform we believe the nation needs, given that too many governments in the past, federal governments and State, have simply brushed this problem to one side because it was all too hard.

DELANEY: Prime Minister, finally, the front page of The Daily Telegraph today describes the current situation with asylum seekers as the Prime Minister's Tampa crisis - refugees moving to Darwin as more boats arrive. Are your policies to blame for attracting more asylum seekers to try their luck crossing the ocean?

PM: Can I just say that we have sought to just respond to each problem as it's arisen as far asylum seekers is concerned. These problems confronted the Howard government in the past, when you had large numbers, very large numbers, of asylum seekers seeking to come to Australia, and these figures change from year to year.

The second thing is this - that when you come to look at what causes the numbers, so much of it arises because you've got changing patterns of instability across the world. Most recently, the big factor affecting not just Australia but countries right across the world was the civil war in Sri Lanka in the middle part of last year.

These factors are being slowly stabilised within Sri Lanka. There's still a problem out there for not just us but many, many countries around the world as a number of Sri Lankans seek to leave their country. We'll simply deal with each of these practical problems as they arise, and we are doing so.

DELANEY: The editorial in the Telegraph suggests, from their point of view, that it's time for you and the Government to harden up on the refugee issue. Obviously, nothing the Australian Government does can influence the so-called push factors, but what we can do, of course, is determine how we respond to that influx, isn't it?

PM: Well, we believe we've got the response about right at present. I also note that some of the earlier changes that were made to the system in terms of the Pacific solution et cetera were then backed by the Opposition. Can I simply say that we have to deal with each practical problem as it arises. We will do so.

And can I say, this is not unique to this government. We've had boats arriving in this country for the last 30 years or so, and there have been more in some years than there have been in others. You just deal with these things in a practical way as each problem presents itself. We'll do so with these as well.

And remember, also, that on this one we're not alone. Every other country around the world is receiving large numbers of arrivals of asylum seekers - or most are, depending on their geographical location - and therefore it's a problem not just nationally, it's a problem regionally, it's a problem right across the world.

That's why we need to deal with it at countries of origin, you need to deal with it internationally through the right bodies, deal with it regionally in partnership with countries like Indonesia and Malaysia.

You know, there are so many interruptions now occurring in partnership with Indonesia and Malaysia of people-smuggling ventures, most of which never reach the newspapers for the simple reason that they are conducted quietly and done effectively on the ground, dealing with people smuggling networks.

However, these are practical problems which the Government has to deal with, and we'll continue to do so.

DELANEY: If we are to believe what we read in the papers, though, there seems to be a rising tide of opinion that our approach needs to change because our approach isn't making a difference.

PM: Well, can I say, in times past, when Mr Howard was Prime Minister, there were larger numbers of arrivals to Australia. Can I say that this in fact is being driven by so many changes in the global political situation.

Back then, you had instabilities arising from various conflicts around the world, then those conflicts tailed off, now we have new conflicts arising. The one I've mentioned most recently is Sri Lanka.

The important thing is to have a balanced approach to dealing with this and enhancing our cooperation with our regional partners to deal with the real challenge of people smuggling on the ground. As I said, many, many interruptions occurring almost on a weekly basis as our partners in Indonesia and Malaysia crack down with us on people smuggling.

However, these are practical problems which we'll continue to deal with, as are all governments around the region and the world.

DELANEY: Prime Minister, thank you for your time today.

PM: Thanks for having me on the program.
 

The Rudd Government will invest $339 million to increase GP training places to record levels to deliver better health and better hospitals for all Australians.

Due to historic lack of investment, we inherited a situation where workforce shortages are impacting upon 59 per cent of all Australians.

In addition, while the number of medical students graduating from our universities will double over the next five years, there has not been a sufficient increase in GP training places to enable more graduating medical students to become General Practitioners.

The Government will raise the number of places available for medical graduates to train to become a General Practitioner to 1,200 per year by 2014.

This historic investment will:

• double the annual limit of 600 places in place when the Government took office.
• provide a 50 per cent increase on the Government's previous commitment to increase places to 812 per year from 2011.
• deliver around 5 million extra services by 2013, when combined with other investments undertaken since the Government took office.

To maintain current levels of GP and primary care services alone, it is estimated that an additional 3,000 GPs will be needed by 2020.

Australia also needs to reduce its high hospitalisation rates, which is currently double that of Canada and significantly higher than the United States, the UK and New Zealand.

This demands more GPs, not only to meet projected shortfalls, but to improve access and availability of GP services and help take pressure off the hospitals system.

The additional GP training places will commence from 2011 and combined with our existing investments will ensure that there are an additional 1,375 GPs practising or in training by 2013.
Over time, these investments will result in a total of 5,500 extra GPs practicing or in training by 2020.

This major investment will build on the Commonwealth's commitment to taking full funding and policy responsibility for all GP services and primary care as part of the National Health and Hospitals Network.

It will ensure that Commonwealth funded GP services have the workforce needed to properly treat Australians through less expensive primary care services rather than shunting them into expensive hospital services.

This investment is part of our major focus on primary care.

This critical investment will be included and offset across the forward estimates in the 2010-11 Budget, consistent with the Government's strict fiscal strategy.
 

The Rudd Government will invest $145 million to train more specialist doctors where the community needs them, to deliver better health and better hospitals for all Australians.

The Government inherited a situation where estimates from the Australian Medical Workforce Advisory Committee and the Medical Colleges suggest there will be a shortage of around 1,280 specialists by 2020.

The Government's investments will mean that this shortfall will be met.

These investments will:

• more than double the current number places from 360 to 900 by 2014, when combined with existing Rudd Government investments; and
• deliver an additional 680 specialists into the health system by 2020.

The remainder of the projected shortfall will continue to be delivered through the public hospitals system.

Traditionally, medical specialist training has been provided in public hospitals. The private sector has not provided a significant portion of the training of future health professionals.

The overwhelming majority of specialist training is delivered in public settings, but we know that medical practice occurs in a much wider range of settings.

With a significant amount of health service delivery now occurring in the private sector, the Government will draw on the private sector to expand overall capacity for specialist training.

This major investment will be targeted at key specialisations and areas of need.

The increase in Specialty Places delivered through this investment will enhance existing specialist training which must continue.

Training targets will be developed in consultation with the medical colleges and States and Territories to ensure that the additional specialists are being trained in specialties where workforce and training capacity shortages are the greatest.

Specialties where shortages currently exist will be targeted.

These include general surgery, pathology, radiology, obstetrics and gynaecology and dermatology.

The Government will also seek the advice of Health Workforce Australia in accurately planning for future specialist workforce needs.

Priority will be given to providing training places in the communities where Australians need them, such as in rural and regional areas.

Supporting training in the private sector will build on the Government's commitment to permanently fund 60 per cent of the costs of training undertaken in public hospitals - making the Commonwealth Government the majority funder of training future doctors.

This critical investment will be included and offset across the forward estimates in the 2010-11 Budget, consistent with the Government's strict fiscal strategy.
 

PM: It's good to be here with Mike and with Nicola today to talk about an important step forward in health and hospitals reform.

The Australian Government is committed to a strong economy, protecting the jobs of hundreds of thousands of working families, keeping Australia out of recession when most of the world, the rest of the world, has gone into recession.

We're also committed to delivering on the basics for working families. Basics in education, basics in health and hospital reform as well. And there is nothing more basic in health and hospital reform than making sure that we have enough doctors, nurses, specialists, and the allied health professionals to keep our hospital system and our health system functioning.

If you talk to working families right across the country - doesn't matter what hospital you go to or which GP practice you go to, country, city - the constant story is this; there are not enough doctors, there are not enough specialists, there are not enough nurses. We hear this right across the country.

Furthermore, in an examination undertaken by the primary healthcare taskforce, we found that six in 10 Australians live in an area where there are shortages of available doctors. Six in 10 Australians living in areas where there is a shortage of available doctors.

That's why the Government, today, will be delivering more than 6,000 new GP and medical specialists to deliver better health and hospital services for working families. We believe the time for action has come

Let me go to GPs. The Department of Health estimates that to maintain current levels of GP and primary care services alone, we will need a further 3,000 GPs out over the next decade. However, we have to do better than simply fill that gap. We have actually got to improve the level of services that we provide through GPs.

One of the reasons why Australia has one of the highest hospitalisation rates among the developed economies is because we don't have enough GPs out there. And therefore, if you've got GPs, more GPs in the community, it means that patients have more, and different places to go. If they don't, they present at accident and emergency, and often end up in acute hospital settings. Therefore, fixing the GP problem is critical.

Secondly, let me go to specialists. Estimates from the Australian Medical Workforce Advisory Committee and the medical colleges tell us that there'll be a shortage of around 1,280 specialists over the course of the decade ahead. These are big numbers. A projected shortage of 3,000 GPs over the decade ahead. A projected shortage of 1,280 medical specialists over the decade ahead. And that's just to keep things going as they are, before you talk about the growth of the system in the future.

So what are we going to do about this?

Firstly on GPs - the Government will invest $339 million to increase GP training places to 1,200 students per year, starting with increasing it to 900 per year next year. This is double the number of GP training places that existed under Mr Abbott's time as Health Minister. In total, our investments will deliver an extra 5,500 GPs working in the community over the course of the decade ahead. That is, we will fill the estimated gap of 3,000 just to keep services running at their current levels, but we will be going beyond that as well, to make sure that there are further services provided by GPs out there for working families.

Let me turn to what we propose to do on specialists. We'll be investing a further $145 million to train more specialist doctors. This will expand specialist training into private hospitals, into community settings, and into, critically, rural hospitals, and deliver an additional 680 specialists into the health system over the course of the decade. That is within those particular training settings. Of course, beyond that, the Government, through its Health and Hospitals Network plan, will be for the first time taking on the dominant responsibility in the public hospital system for the teaching and training of specialists as well.

So on the one hand, we are adding another 680 specialists across the decade ahead, through these other training settings - private hospitals, community settings, as well as regional and rural hospitals - as well as for the first time the Australian Government becoming the dominant funder for expanded specialist training within the major public hospitals as well. These are the essence of the reforms that we have planned for doctors, for GPs, for specialists. In total, this plan to deal with the shortages in our medical workforce comes to some $632 million. This plan will be fully offset and the details associated with its funding will be outlined fully in the Budget which is due in May.

This represents new money for the system. This is a new investment for the future. We begin expanding these places as of next year.

This is a necessary reform for Australia. We've proposed a new health and hospital network for Australia, funded nationally, run locally, for the first time the Australian Government taking on the dominant funding responsibility for the future of the public hospital system. The exclusive funding responsibility for the primary care system. Exclusive responsibility also for the aged care system.

Can I ask Nicola to add to my remarks, given that she has been integrally involved in this and all other elements of our health reform plan.

MINISTER ROXON: Thank you Prime Minister. I just want to add a couple of extra comments, because today is a very significant announcement, appropriate that we're here with Mike Kelly, someone who deals both with the larger regional hospitals like Queanbeyan Hospital that we're at today, but also deals with the needs of GPs in smaller communities, and has been a very strong advocate for us getting this plan right, in addition to the rural incentives that of course were in last year's budget and commence on the first of July for GPs.

What we're doing today is investing in the lifeblood of our health and hospital system. We know that we cannot fix the imbalances in our system if we don't have a strong primary care system, and GPs are absolutely critical to that. So these extra training places not only will help meet the needs of the community, but will help meet the needs of our hospitals as well.

Of course, Queanbeyan Hospital is run significantly with its medical workforce as visiting medical officers, local GPs come in to the local hospital to provide services. So as well as fixing our primary care system, we're making sure that we're helping fix our hospital system as well.

We're providing more GP training places. We want young graduates, the numbers of which will be increasing over coming years, to see that General Practice is the place to be. It's where they can provide support for the community. It's where they can do a lot of the good work that they're trained for. And up until now there's been a cap on the places that has prevented some of those young students going into General Practice where they're desperately needed by the community.

We're also going to provide more support to doctors in training. For those in the health sector, the PGPPP program is a very important program. It provides young students and new graduates with experience in General Practice, rather than simply training them always in hospitals, exposure to General Practice as a vital part of our health system. And of course, importantly, training for specialists. We know that increasingly, as services are provided in private and community settings, and we want to encourage that, it helps the balance in our system, we need to provide more training in those other components of the system too.

And that's why our specialist program is targeted to rural and regional settings. It's targeted to private settings, and community settings. Of course, the public hospitals have done the lion's share of training before. But both they and our private hospitals and our general practices are calling out for the support that we are providing today to allow specialists to be trained in a better variety of settings, and we'll be working very closely with the colleges to ensure that the specialties that are in high demand and where there are shortages and the communities that are experiencing shortages are those that get the first priority for these new training places.

So I'm very excited about this announcement today, because we know we have to get the workforce right, the lifeblood of the system, if we're going to get health and hospital reform right. So I'm very pleased to be here with the Prime Minister to make this announcement, and we're of course happy to take any questions.

JOURNALIST: The specialist colleges have stood in the way in the past. Are they going to be on-side here? (inaudible)

MINISTER ROXON: Look, I think we've seen a significant change in the approach that many of the colleges are taking, and the virtue of course of us funding more of these places is the conditions that can be attached, whether it's for the specialties where there are shortages like obstetrics and gynaecology or pathology, general surgery can be prioritised, but also making sure that these training places can increasingly be undertaken for example in our major regional hospitals, not just in the CBDs where a lot of training will still be done, but needs to be enhanced in those areas where there are shortages.

JOURNALIST: But the ACCC has made clear as Bonge says - was talking about - that in the past, some specialist colleges have actively sought to limit their own numbers to keep their appointment book full. Are you prepared to take them on if that happens to make this happen? And secondly, you're providing a lot of new doctors, but how do you make sure that they don't all settle within, you know, five kilometres of the GPO rather than going rural?

MINISTER ROXON: Well this is why it's such a carefully designed announcement, and why it complements the initiatives that were announced in last year's Budget in terms of the incentives for rural and regional GPs. It's why we are prepared to put money on the table for specialist training places, and with that will come conditions. And my discussions with the colleges to date have been very supportive of this.

You'll of course - I don't want to put words in their mouth - you'll need to talk to them directly, but if we see any misuse or abuse of these programs, of course we would act strongly. But I'm actually very optimistic that there is a realisation from our community of doctors that some services are not being provided in the community because of a poor distribution of specialists, and a poor distribution of GPs. We can pull our weight, that's what this announcement's doing, and we certainly will be expecting and encouraging the colleges to pull their weight.

JOURNALIST: And if they don't?

MINISTER ROXON: Well, we're making this announcement today and I'm very optimistic that they will be very positive about it.

JOURNALIST: Will you make the places bonded so that people who get (inaudible)

MINISTER ROXON: Well, as I think any one of a number of specialists who are here or working at other hospitals will already tell you, the training period is a long period for specialties. These services can be provided while people are in training. That, in itself, makes a significant difference to the services that can be provided in rural and regional communities, and, of course, when you then balance that with, for example, in general practice incentives that are very generous now being offered, I am confident that we can make a significant difference to the shortages, both in terms of specialties and in terms of regions where there have been shortfalls.

JOURNALIST: Mr Rudd, (inaudible) Victoria, what do you do next - do you override Victoria or do you go to the next election?

PM: All I'd say in response to that, Michelle, is one step at a time. We've had some good discussions with the premiers of NSW, Queensland and Victoria so far. We've got a few weeks to go yet between now and when the Council of Australian Governments meets, but our bottom line hasn't changed one bit.

Can I add also to Nicola's answer concerning rural and regional areas, which was raised, I think, just before?

You know, what's the big problem out there in rural and regional areas? I grew up in a small town in country Queensland. I think we had a visiting doctor once a month for half a day. This pattern across rural and regional Australia, frankly, has not been getting better. It's probably been getting worse. So what can you do about it?

The first thing is to make sure your overall supply of trained GPs increases. This is a very big step forward. We're talking about 5,500 GPs.

The second is this - the distribution of both those GP training places and the distribution of the specialist training places will be very mindful of the needs of regional and rural Australia.

Thirdly, what I find when I go to communities in the bush and elsewhere is that if a GP is trained in a local area and begins to establish roots in that local area, they tend to stay in that local area. The key thing is to make sure that you've properly distributed GP training places out there in regional and rural centres which make it possible, and similarly for specialists as well.

This is an important reform, not just in terms of the overall need for more doctors in our system, and more GPs and more specialists - it's also to deal with what is a chronic shortage of those services out in rural and regional Australia.

JOURNALIST: When will you be talking to Jon Stanhope (inaudible)

PM: Pretty soon. We've had a quick chat on the phone already, and it's less of a commute than it is to Perth, so I'll probably head to Perth before too much longer.

MINISTER ROXON: Can I just add onto that, too, because I've had several conversations with Katie Gallagher, and those of you who cover ACT politics will know that this announcement for GPs is absolutely critical - in fact, their top-order request in terms of health reform - because, surprisingly, there is actually a severe problem with GPs in the ACT, both in terms of numbers and lack of bulk billing. So I am sure that when that conversation is had that these announcements today will be very much welcomed by the ACT Government.

PM: Where the rubber hits the road with a lot of this, it's been useful talking to the health experts here in Queanbeyan this morning, and listening to Mike and his comments about this community and health care services here over a long period of time. I've just been through this hospital, which I'm advised has 32 beds, not many of which are occupied at the moment. That's just the truth. Part of that lies in the fact that we have some real workforce challenges here.

Secondly, we have an operating theatres capacity - three theatres I'm advised by one of the docs this morning, capable of doing, I think, if I can recall correctly, about 120 a procedures a month presently operating with about 20 or 30 procedures a month. Therefore, we've got a problem there.

Thirdly, as Nicola has just said and Mike has certainly been saying to me for a long time, the adequacy of GP services in the community as well, which is why, down the road here, a GP Super Clinic is being put together and I understand will be open sometime in the early part of 2011 so that you've got enough doctors, more flexible hours, operating out there in the community, but also there's enough doctors operating within hospitals like this to actually use them to their proper capacity.

JOURNALIST: (inaudible)

PM: You know something? Hospitals like this have a huge future under the National Health and Hospitals Network of Australia, because what we're dealing with is one - how do we fund the system properly for the long term? Two - how do we make sure we have enough doctors, GPs and specialists to run the system in the future? And three - how do we also make sure that the other necessary reforms are embraced by the states and territories as well.

One footnote on that - again, the locals tell me today that here we are in Queanbeyan, which is part of a health region which is, I think, called Greater Southern Area, which starts up somewhere near Goulburn, goes to the Victorian border, east to the coast and west to somewhere.

Now, can I just say that's a fair bit of turf, OK? And in this part of the world, while I am very reluctant to engage in the business of where you should draw lines around communities of interest, surely we should start thinking about why a local hospital network in this area doesn't bring together hospitals in Canberra, in Queanbeyan, in Yass and Cooma and to make some sensible, local, community-of-interest decisions for the future.

JOURNALIST: Back to this hospital then, there's three or however many operating theatres idle at the moment. Doesn't the real problem, again, get back to the behaviour of doctors? They won't get off their tails in Sydney inner city or perhaps in Canberra, although the customer can't get a doctor there either, and come out here and work? Don't you have to compel them or do something?

PM: Two key things that we're doing here - one-

JOURNALIST: - Well, you know, I'm not joking, you're from Queensland, you can't get a doctor north of Nambour?

PM: Just listening for command and control and civil conscription. Can I just say this? Key problem, key challenge, is where do you physically fund and provide enough GP training places for the future? And what we are doing across this very large increase in the GP workforce is to make sure that they are going adequately out to rural and regional hospitals as well.

And secondly for specialists, this package concerning 680 specialists is focussed on rural settings, it's focussed on community settings, so that we can make it possible for people to become well grounded, well entrenched, well integrated with these local communities, where they want to stay, have their families, grow up, have their kids go to school. You've got to do things that way. Command and control? Well, let's see how this one works.

JOURNALIST: (inaudible) provider numbers on a geographic basis?

MINISTER ROXON: Can I just add one comment to that, which I think really does go to the core of that issue?

One of the most significant shortages in specialties is for general surgery - general surgery that would actually be used in hospitals like Queanbeyan Hospital, so we have to actually deal with the pipeline as well. We have to make sure we are training people in the right specialties and encouraging them to work in the places where there are shortages. We can't just do one or the other.

If we made some rule, as you're suggesting, there would simply not be enough bodies in a number of these specialties to meet the needs across the country. So we have to enhance the training places in specialties where there are shortages and lots of them are the ones that are critically felt in rural and regional Australia.

And we have to get the mix of our other funding right, as the network plan that was released about 10 days ago seeks to do, to get our rural incentives right, so what you see is this jigsaw coming together to meet the demands of the community, the correct demands of the community to have proper services closer to home.

JOURNALIST: (inaudible) suggestion you'll need to pay remote hospitals 55 per cent more than a city hospital to keep it open and regional hospitals will need up to 22 per cent more. Are they going to get that much?

PM: Well, we said very plainly the other day in response to a fear campaign being launched elsewhere that there will be not a single hospital in rural and regional Australia which will be required to close as a result of the introduction of the new National Health and Hospital Network - not one. We've been very plain about that.

Secondly, therefore, we will be designing the way in which hospitals are funded for the future to take into account the different costs of delivering services in rural and regional Australia. That's just a fact. People live out there. Therefore, you've got to make sure that they have decent access to healthcare services. You can't provide those services on the same cost structure as apply in the inner suburbs of Brisbane or the inner suburbs of Sydney. It's just different.

And when you get to Indigenous health, it gets even more of a challenge.

Sorry, you had a question as well.

JOURNALIST: Mr Rudd, you're sympathetic to the problems Barack Obama's facing on health reform. Given the real difficulties he's facing, do you think there is a chance he won't make it to Australia, and given that Hillary Clinton's already had to pull out, what does it say about the nature of the relationship?

PM: Oh, the relationship with the United States is in pretty good working order. I deal with the President a lot, as does Stephen with Hillary, as does Senator Faulkner with his counterpart in the United States.

Barack Obama has challenges when it comes to getting health reform through a troublesome senate. I have a lot of sympathy for Barack Obama because that's part of the democracy that we have to deal with.

JOURNALIST: Do you think he'll still make it to Australia?

PM: Look, our most recent advice is that the visit will be delayed and shortened a bit, but look, we're pretty relaxed about all this. It's a great relationship. I catch up with the President quite regularly, certainly on the phone, and we are meeting constantly at international conferences, and our officials are working together the whole time.

He's a welcome guest in Australia, whenever he can get here and for how long.

And having said all that, folks, we've got to zip and get back to Canberra. See you.