Leaked budget memo reveals massive drop in state contribution to health spending

Figures revealed: The document shows the state government plans to cut its contribution to health spending from $2040 per person in 2016-17 to $1849 per person in 2020-21.
Figures revealed: The document shows the state government plans to cut its contribution to health spending from $2040 per person in 2016-17 to $1849 per person in 2020-21.

The state government is planning to slash its “real per capita” contribution to health spending by almost 10 percent over the next few years – and by more than five percent in 2018-19 alone – according to a leaked budget briefing note.

The document, which is marked “for the Minister for Health only”, has emerged in a row over funding for Mandurah’s Peel Health Campus and led to calls for the government to announce plans to expand the hospital in May’s state budget.

It details how much the government will spend per person in the health budget after including inflation and excluding non-state funding such as Commonwealth grants, private patient revenue and donations.

According to the briefing note, real per capita health appropriations will drop from $2040 per Western Australian in Labor’s first budget delivered in 2017 to $1849 in 2020-21.

Health Minister Roger Cook and Mandurah MP David Templeman at the Peel Health Campus before the state election in 2017. Photo: Amy Martin.

Health Minister Roger Cook and Mandurah MP David Templeman at the Peel Health Campus before the state election in 2017. Photo: Amy Martin.

The biggest cut is a planned 5.17 per cent drop in real per capita health appropriations for the 2018-19 financial year.

Health Minister Roger Cook said it was “very misleading” to rely on government appropriations alone as a measure of health spending.

“The measure of the government’s investment in health service delivery is the total expenditure approved for health services over the forward estimates,” he said.

“On this measure, the 2017-18 Budget and forward estimates provide for average growth in total health expenditure of 1.1 per cent per annum, and average growth in total expenditure on hospital services of 3.1 per cent per annum.

“The government has budgeted for the total cost of health services to rise from 8.8 billion dollars (2016/17) to 8.9 billion dollars (2017/18).”

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But the opposition’s Peel region spokesman Zak Kirkup said the government was using accounting tricks to siphon money away from health spending to the detriment of the Peel region.

“At a time when we need more health funding for our community, when we need our hospital emergency department to be expanded and a long-term plan for the delivery of health services in the Peel region, I find it absolutely disgraceful that this government has gutted 10 per cent out of its health budget appropriations per capita,” he said.

The Dawesville MP said no matter which way the government characterised the figures, less state government money in the health budget would impact health services in Mandurah.

“This makes the situation at Peel Health Campus even worse when you consider we need this expansion, the minister has admitted that and yet they are reducing their overall contribution to health funding,” Mr Kirkup said.

“That doesn't make sense. It shows to me that once again this is an arrogant government that is out of touch with the concerns of the people in the Mandurah community and I think it’s a very real concern and one of the issues I’ll be raising at our health rally on May 1.”

Mr Cook said the Sustainable Health Review, which is due to deliver its report in November, would “inform future health service planning decisions”.

“The interim report has already identified the Peel region as a pressure point,” he said.