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30 Apr 2015

The AMA has written to Assistant Treasurer, Josh Frydenberg, urging the Government to adopt a cautious and consultative approach on any reforms to tax concessions for public hospitals.

AMA Vice President, Dr Stephen Parnis, said today that media reports suggest the Government is actively considering making changes to tax concessions for public hospitals in the May Budget.

“The Government is currently in the middle of a broad consultation on tax reform, which includes the future of public hospital tax concessions, so it would be inappropriate to introduce a Budget measure that would disadvantage hospitals and all their staff without proper consultation,” Dr Parnis said.

“The AMA has warned that ill-conceived and rushed reforms could significantly affect the ability of public hospitals to recruit and retain staff.

“Traditionally, public hospitals have been a less attractive area of practice for doctors because private sector work generally attracts greater remuneration when compared to the salaries and conditions available to most doctors who work primarily in public hospitals.

“Australia’s public hospitals are world class. They are the mainstay of acute care for the majority of Australians, particularly the most vulnerable members of our society.

“Timely access to high quality care for many people depends on public hospitals being able to recruit and retain sufficient numbers of doctors and other staff.

“The current framework of tax concessions for the Not For Profit sector, including public hospitals, reflects good public policy, developed over more than 25 years.

“These concessions have been designed to support the recruitment of suitably qualified staff to work in important institutions that would not otherwise be able to compete against the salaries offered by the private sector.

“Regional public hospitals would be particularly vulnerable to any changes to the current system of tax concessions, because the concessions are important to the recruitment of permanent staff as well as locums.”

Dr Parnis said that public hospitals are already stressed and under pressure, with capacity stretched to the absolute limit.

“The Prime Minister, the Premiers, and Chief Ministers will be discussing the broad funding and governance issues of public hospitals at their July retreat, and a Tax White Paper consultative process is underway with stakeholder groups,” Dr Parnis said.

“These consultations should be allowed to run their course.

“It would be disruptive and counterproductive to hit the overburdened public hospital sector with another Budget shock.

“The AMA is asking for urgent assurance that changes to existing tax concessions for public hospitals will not be a feature of the upcoming Budget.

“The AMA supports the current process of consultation.

“It would be premature for the Government to do anything until this work is completed.”

30 April 2015

CONTACT:        John Flannery                     02 6270 5477 / 0419 494 761

                            Odette Visser                      02 6270 5412 / 0427 209 753

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Published: 30 Apr 2015