Why the carbon tax is literally bad for your health
If you transferred millions from a public hospital budget to the Cayman Islands, it would be a national scandal. But transferring the same millions to Canberra in the name of a carbon tax has evoked not even a whisper in our four Labor states and territories.
It is not like they can afford it. Tasmania just pleaded for and secured a $325 million bailout. That total will now be deducted a carbon tax. Northern Territory is in meltdown attempting to meet the needs of remote Aboriginal populations. South Australia and the ACT are little better.
Thankfully the four Coalition states have now completed their carbon tax analysis. This week, Western Australia became the fourth jurisdiction after New South Wales, Victoria and Queensland to report the carbon tax impact upon its hospital system.
Calculating the carbon tax on these public health facilities is a complex, incorporating grid power, gas consumption, the carbon price on every consumable and the freight costs of delivery. Hospitals are massive energy consumers, emitting five megatons of CO2e annually. Beyond grid-supply, they consume co-generated power, natural gas, LPG and raise steam.
Victorian grid supplied energy is predicted to rise 14% in real terms. LNG will increase 16%, rising to 19% in 2020. Capital expansion of hospitals is also affected, even though energy intense trade exposed sectors like aluminium, cement and steel are partially assisted.
It is a vital calculation to perform because unlike the rest of the economy, public health services don’t charge their patients. Unable to pass the carbon tax along a supply chain through price adjustments, state governments have little option other than to deliver fewer services.
Less health care is a logical outcome because Canberra remains wedded to an economy-wide tax, refusing any compensation or exemption to state emergency, health, education and social services.
That means the carbon tax will hit any health service with a power point, including the small facilities like alcohol, drug and mental health services which don’t have the luxury of juggling budgets and programs to come up with the cash for Canberra.
The first state to report was New South Wales where Treasury revealed the carbon tax hit on their health services would be $26.5 million per year or $1,965 per bed. They forecasted an overall impact of $212 million by 2020. Next, Victoria estimated a $13.5 million hospital carbon tax this year, rising to $21 million annually by 2020 per annum.
The dispersed Queensland population faces the highest carbon price of the Coalition states, with a $30 million bill in 2013 or a $2,425 annual hospital bed tax. With health spending in that state growing at around 11% per annum, this figure will also rise dramatically to $280 million by the year 2020.
New Western Australian analysis approximated Victoria’s with a direct impact of $6-7 million per year, $1,477-$1,724 per bed and a $60 million money-go-round to Canberra by 2020.
Obviously none of this money circulation cools the planet, let alone saves it. Already grinding out efficiency dividends, it is pretty obvious that most state hospital systems will simply pay the tax as they go, cut services or rack up more debt.
Remarkably, half of Australia doesn’t even know carbon debiting is occurring at hospital level. That is because the four Labor states and territories refer all inquiries to the Commonwealth. Remaining mute to protect Julia Gillard clearly trumps protecting their populations’ health.
Sure a million here and a million there is only a fraction of a ten billion dollar state health budget. But government was once a game of millimetres, where finding scarce dollars to efficiently serve citizens was an immutable ideal. How that has changed. Minister Combet now casually claims the costs to the health system will only be 0.3% without ever explaining that such a fraction of Queensland Health is $30 million dollars annually.
The other brush-off from Canberra is that federal funding has been more than generously indexed. This year’s 6.7% increase however doesn’t come close to the year-on-year 11% budget blow-outs in Queensland Health. Indexation was determined years ago, long before the carbon price was even conceived.
Next week, COAG meets. It is the ideal time to ask why Commonwealth special purpose payments to states are now being recycled in the name of a carbon tax. For Australians desperately reliant on public hospitals, they can only hope that the services they need don’t end up being carbon taxed away to the Caymans in the form of foreign carbon credits.
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