Providing a comprehensive and exhaustive comparison of the principled or pragmatic basis of all policy within Australia s two major parties is clearly beyond the compass of a monograph such as this. However, a carefully framed case-study might give an indicative portrait of the broader situation with the two parties. For a case study to be useful in this regard if it is to throw light on the manner in which a party s policies reflect its core values or not then two basic matters need to be settled. Firstly, a defensible choice needs to be made as to which of the parties policies to focus on and compare in the case study. If the case study is to illuminate the broader situation, then the policies chosen will need to be representative in some way. Secondly, a defensible case needs to be made as to what the parties core ideals are in terms of which those chosen policies are to be assessed and compared. The next few sections will take up these two groundwork issues. As for the manner in which the assessments and comparisons of the case-study are to be made, as said earlier, these will ineluctably be qualitative and interpretive in nature.
Which of the two parties policies or policy areas should be focused on in a case study to give a representative portrait of the parties justificatory dispositions? One possibility is to focus, for the ALP, on policy areas that are often considered traditional strengths of ideologically left parties (e.g. health, education, and welfare); and for the Liberal Party, traditional strengths of the ideological right (e.g. security, economic management and foreign affairs). Though this has some attractions, it also harbours some important drawbacks. It presupposes that the two Australian parties clearly divide in their left-right ideological positions. But those positions may not be as determinate or straightforward as might be thought.(1) Such an approach might, therefore, end up tagging the parties with policy areas that they might not be (or be seen as) central or important to their current political mission. Arguably, this should be one of the crucial considerations focusing on policy areas or positions that the parties themselves consider of greatest importance or centrality. It is likely to be in these policy areas that the parties invest most justificatory energy, and where the dynamics of principle and pragmatism might be more prominently within view. These policy areas could, in other words, be viewed as best practice cases that provide a benchmark to indicate the situation within the broader gamut of party policy. If, for example, core party values are reflected at a moderate or low level in a party s best practice policy areas, then that might be taken as an indication that across most policy areas for that party, it is unlikely that party values will be reflected more strongly. So, a case-study focusing on policy areas that the parties consider most important might at least have some representative or indicative potential. Of course, it is not only the degree of integrity with party principles that we wish to assess and compare in the parties policies. A central interest is the degree to which they might also reflect or promote party values in the indirect strategic sense, and connected with this, the degree to which policies of that strategic nature run the risk of the parties compromising their philosophical identities. The choice of policy areas to focus on in a case-study should keep these interests strongly in view also.
What are the policy areas or positions that Australia s two major parties respectively consider most important to them? Arguably, one good indicator of the priorities and importance a party gives to its various policies is the degree of emphasis it gives to them in its election manifesto and/or policy launch speeches.(2) During Australian elections, competing parties present their policies broadly under the same circumstances of competing for office, and are faced with the task in policy launches of prioritising the policies and positions they wish to emphasise to the public. What they emphasise to the public in those election policy launches, is arguably a strong indication of what they want the public to see them as standing for. Certainly, policy launch speeches are very interest-driven documents, and they are targeted to maximise a party s chances of winning. But, for our purposes, this is a fact to be welcomed. It can provide insight into the strategic compromises of principle, where policy content diverges from strict adherence to party principle in the name of what might be necessary to win the election, and thus to strategically maximising realisation of the party s values.
Given this, the policy areas selected for our limited scope portrait of principles and policy, will be ones that were most emphasised in each of the Labor Party s and Liberal Party s 2004 election policy launch speeches. Moreover, given that there may be important principled differences within the one party between its economic policies and its social policies, the case study will include policies from each of these domains.(3)
A credible measure of the relative emphasis a speech gives to a policy is the proportion of statements in the speech that mention the policy. Of the 354 specifically policy related statements made in the ALP 2004 Campaign Launch Speech,(4) by far the greatest proportion (33 per cent) was devoted to health policy. In the social domain, the next most emphasized policy area was education (14 per cent of all policy related statements). The most emphasised policy areas in the economic domain were tax policy (12 per cent) and responsible economic management (7 per cent). This suggests that, for our purposes, the dominant or flagship ALP policy areas to focus on in the social domain will be health and education, and in the economic domain, tax policy and responsible economic management.
For the Liberal Party, of the 323 policy-related statements in John Howard s address to the Coalition campaign launch,(5) by far the dominant focus in the economic policy domain was responsible economic management (22 per cent). However, apart from an emphasis on the importance of productivity and low interest rates, there was little identified in the way of specific policies or measures representing responsible economic management. Not unrelated, though, were the next most emphasised cluster of economic policy areas tax policy (10 per cent), small business (10 per cent), and industrial relations (10 per cent). The focus when it came to small business, was on tax incentives and the freeing up of industrial relations provisions to facilitate further business entrepreneurialism. Effectively, then, the dominant policy foci in the economic domain for the Liberal Party could be argued to be tax and industrial relations. In the social domain, the greatest single policy focus was on health (13 per cent), and then school education (7 per cent), and vocational education and training (8 per cent). Altogether, this suggests that the flagship Liberal Party policies to focus on for our case-study will be tax policy and industrial relations in the economic domain, and health in the social domain.
It is notable that the policy areas that have emerged from the selection process for this case-study turn out to be very similar for both parties. Of considerable interest also, is evidence that these two policy areas were considered by non-committed voters to be important during the 2004 election campaign. Of those voters surveyed as part of the 2004 Australian Election Study who did not always vote for the same party, the highest proportion (27.8 per cent) identified Health and Medicare as the most important election issue. Education was identified by the second highest proportion (17.5 per cent), closely followed by Taxation (15.2 per cent). Of those surveyed voters who were not very strong supporters of their party (i.e. less party-committed), the highest proportion (34.1 per cent) considered Health and Medicare the most important election issue, and the second highest proportion (19.1 per cent) nominated Taxation as the most important issue.(6)
In line with this, the following Liberal Party 2004 election policies will be examined:
100% Medicare: Making GP Services More Affordable than Ever Before (incorporating the Medicare Plus policy, and with reference to pharmaceutical subsidy policy) (7)
Promoting an Enterprise Culture and Flexibility and Productivity in the Workplace , (supplemented by A Stronger Economy, A Stronger Australia )
And the following ALP 2004 election policies will be examined :
Medicare Gold (with reference to Dental Policy, and pharmaceutical subsidy policy)(8)
Rewarding Hard Work: Labor s Tax and Better Family Payment Plan (9)
Having identified these policies as the subject matter for the case-study, it now remains to identify, for each party, the appropriate party principles and values that should be applied in assessing those policies. Not surprisingly, this will not be a straightforward matter. The next sections take up some of the complexities involved in isolating which, of the many candidate conceptions of the two parties fundamental values, might be the most defensible to refer to for the purposes at hand.
Clearly, to determine how faithfully a party s flagship policies reflect its core ideals, and where strategic compromises might occur, we need to develop a defensible conception of what those ideals are. Some would argue, and not implausibly, that a party s real values are the ones that are revealed in what the party actually does, rather than what it says or advocates. There is a strong sense in which that is the case. But even if it is the case, the task in this monograph is to assess the parties policies what they do or undertake to do against the ideals they advocate. It may well turn out that that assessment reveals there is sufficient discrepancy for us to question in the end whether the advocated ideals are the operative ones. This would be an important outcome. But it will only come to light if the assessment takes as the central indicator of a party s core ideals and values, what the party advocates to be just that.
Australia s two major parties are pluralist in nature. The Labor Party is known for its factions, and the Liberal Party considers itself a broad church , that does not seek to impose a robust conception of the best or most worthwhile life on its members. It was also noted earlier that a party s ideals and values are not necessarily immutable, indefeasible, axiomatic and unbreachable. The fact that there may be a plurality of perhaps competing values at the heart of a party s overall philosophical approach, means that a decision needs to be made as to which to focus on as the yard-stick for an assessment of principled justification.
David Kemp neatly sums up the nature of political party philosophies, as follows:
A political party s philosophy is not like that of the professional philosopher. It is generally not written down at length nor is anyone charged with ensuring that it is fully coherent. Insofar as political parties can be said to have philosophies, they are amalgams of values and beliefs which are articulated in the party s platforms and by its leaders, and appeal to various elements of the party s base of support.(10)
For the purposes of constructing our case-study, the appropriate core values will be identified through certain authority texts that the parties themselves take as expressive of their principled goals or perspective. The texts will include the parties platform statements, as well as extended statements of the party leaders or party authority figures that are specifically devoted to characterising their parties basic philosophical positions. Through these it may be possible to pin down the plurality of values and ideals within a party s philosophical repertoire that are especially privileged, and contemporary in a way that makes them applicable in the context of the 2004 election.
Liberal Party Core Values
There is no shortage of commentary and historical scholarship on the philosophical perspectives that have informed the activities and approach of the Liberal Party since its inception. It would be safe to say that those philosophical perspectives mostly fall within the scope of small l liberalism.(11) Conspicuously, though, the Liberal Party has not been philosophically uniform throughout its history. The Liberal Party under Hewson, for example, was different in certain ways from the Liberal Party under Menzies, and Fraser s Liberal Party was not exactly the same as Howard s. Liberal leaders play a significant role in setting the philosophical emphasis and agenda of that party, and under different leaderships the Liberal Party has embraced different aspects and emphases within liberalism. Even within the reign of a single leadership, the emphasis may shift. This suggests that a good source of authority texts for the Liberal Party s current philosophical positions will be certain speeches made by its current leader John Howard, which are expressly intended to outline that party s values.
Since 1995, John Howard has made a number of key speeches directly relating to the guiding principles and values of the Liberal Party.(12) Though there have been changes in the manner and the metaphors Howard has employed since 1995, there have been four basic themes that have consistently typified the political ideals he has avowed economic liberalism, social conservatism, populism, and a commitment to the devolution of decision-making and responsibility away from the state toward individuals and civil society. On face value, some of these themes are conceptually in tension, particularly liberalism and conservatism. All of the themes, however, are interlinked, and teasing out the linkages and priorities between them can serve to reveal how they might act in consort. Indeed, this prioritising is necessary if we are to identify what might defensibly be considered the core values and imperatives driving John Howard s Liberal Party. The contention, defended shortly, is that the fundamental and driving theme among the four is the last theme concerning devolution. It is arguably in terms of this theme that the other seemingly incompatible themes can be sensibly brought together. Moreover it can be argued that it is this theme that forms the central philosophical parameter along which the Liberal Party and the ALP currently differ.
It is widely agreed that John Howard is economically liberal. John Howard consistently takes himself, and the Liberal Party under his leadership, to be that. Howard s economic liberalism has been expressed (since 1995) in terms of expanding and enhancing individual liberty and opportunity in and via the marketplace, providing incentives for individuals to take risks and display business entrepreneurialism, promoting financial deregulation, competition and privatisation, encouraging the decentralisation of economic enterprises, the importance of economic growth as a provider of enhanced opportunities, and people s right to choose and voluntarily negotiate their individual workplace arrangements.
While the economic liberalism of John Hewson (under the policy direction of Fightback!) was more libertarian and lassez faire, Howard tempers his economic liberalism with the importance of a government provided safety-net, a leg-up or what he has more recently come to describe as ensuring a fair go for all. Modern liberalism, according to Howard, must be concerned not just with economic efficiency, but also equity and fairness and caring.(13) Howard sees this as a consistent feature of Australian liberalism since Menzies, and cites the development since Menzies leadership, of the social security safety-net, child endowment, health services and pharmaceutical benefits, and age pensions.
The socially conservative element in Howard s liberalism is also prominent. Howard takes the defining feature of Liberal Party philosophy to be its blending of classical liberalism and conservatism. The social conservatism it adopts is an amalgam of a number of imperatives, including: the preservation of those traditions and characteristics of the past that remain relevant to the present and serve the national interest; retaining institutions and practises that serve the best interests of the community; strengthening Australia s sense of community by redirecting the policy focus to what unites and binds Australians rather than ways in which they are different; engendering a sense of common purpose and community cooperation; and strengthening the importance of the traditional family in policy making.
Closely connected with this social conservatism in Howard s liberalism, is its element of populism . Rather than populism being a totally distinct philosophical theme, it tends to have more the character of a prominent dimension of the other three. Howard s liberalism can be seen as populist in a number of respects. It takes its decision-making not to be ideologically based, but sourced in elements of the Australian national character . The values that the Liberal Party stands for, according to Howard, come from the community itself, rather than being imposed from outside it. According to Howard, the Liberal Government (between 1996 and 2000) has succeeded in creating a correlation between the principles, priorities and aspirations of ordinary Australians, and the Government s own policy development framework.(14) Liberal Party policy is also seen by Howard not as being driven by prominent or sectional interest groups, but as being responsive to the broad Australian mainstream. Liberal Party decision-making is seen as drawing on the numerous community-based organisations that are the natural expression of neighbourhood.(15) The liberalism of Howard is therefore populist in two senses its decision-making purports to be based on shared community values, and its decisions purport to reflect the interests of the middle Australian community. Populism in these respects can be seen as an expression of economic liberalism (responding to free choice and not imposing a particular way of life); as reflecting social conservatism (acts to reinforce the social role and efficacy of middle Australia); and also as sourcing the authority for political decisions as being in characteristics of the Australian community itself.
The devolution theme in Howard s brand of liberalism has perhaps been the most persistent one since 1995. There has, however, been a shift in the way this theme has been expressed between 1995 and more recently. Where, in 1995 and 1996, Howard spoke of devolution and decentralisation in the terminology of strategic and limited government,(16) he has more recently spoken in terms of the importance of individual self-reliance, mutual obligation, people taking responsibility for themselves and their families, and citizens forming social coalitions and pulling together as a community .(17) The message has remained the same that more of what was considered within the purview of state action and government responsibility (by way of service provision) becomes the responsibility of individuals and voluntary associations interacting in the private and civil domain. The emphasis in this message has shifted, however from the contraction of state and public sector responsibilities, to the expansion of individual and private sphere obligations.
The theme of decentralisation/devolution is driven by the values of civic responsibility in public life, and the importance of a sense of community in Australian life. Much of the Howard agenda toward voluntarism, community-business partnerships, philanthropy, localised community-based service provision, and community capacity-building initiatives, can be seen as expanding the role of civil society in providing those services, social goods and needs that are often seen as the responsibility of the state. The role of government, according to Howard s liberalism, is to foster the community conditions to allow individuals, through their communities and families, to help themselves. The role of government is not to always help individuals directly. Indeed, Howard has said that the only real freedom is the brave acceptance of unclouded individual responsibility.(18)
On the face of it, there are tensions between some of these themes. The most obvious is the incompatibility between Howard s liberalism and his conservatism between the importance he accords to individuals free choice, but also to government actively maintaining certain values, traditions and ways of living (regardless of whether individuals all hold those values or prefer those traditional institutions and ways of life). It is true that Howard wants to confine the conservatism to the social sphere, and the liberalism to the economic, but it is not immediately clear that that is easily done from a conceptual point of view. Individual freedom is important in the economic market presumably because it is paramount for people to be able to pursue their own preferences in line with their individual values. Why are individuals chosen values, regardless of tradition, not similarly paramount in the social sphere? Moreover, it is not clear that the division between the social and the economic spheres of personal activity is sufficiently sharp to simultaneously support philosophical commitments as distinct as liberalism and conservatism.
So, is John Howard a liberal or a conservative, and is he mistaken in thinking the Liberal Party of Australia can be both? If we are to discern the core values of the Liberal Party, these questions need to be answered. It is implausible to suppose that liberalism and conservatism can simultaneously and equally feature as fundamental Liberal Party values. But this does not mean that they could not co-exist if they could both be shown to be central dimensions of another, deeper philosophical commitment in Howard s liberalism. It will be held here that this is indeed the case, and that a qualified economic liberalism and a qualified social conservatism are both instrumental to devolving responsibility for people s well-being and opportunities away from the centralised collective of the state and public sector, toward individuals and civil society. In fact, reconciling these apparently disparate themes in this way is the best way of rendering Howard s liberalism as philosophically unified and coherent. Moreover, adopting that view might throw some light on the basic respects in which the Liberal Party and the ALP differ philosophically.
What is being devolved or decentralised in Howard s devolutionist program is the responsibility for ministering to individuals social and personal well-being. That responsibility is to be shifted away from government and toward individuals and the civil sector. According to Howard, the role of government in this devolutionist program is ideally to ensure that the basic social, political and market conditions prevail that make possible this assuming of civil and individual responsibility, and no more. In other words, the role of government is merely to capacitate. To fully achieve the devolutionist goal, that capacity building needs to be comprehensive and strategic, and encompass both the social and economic domains. However, it need not encompass each in the same way. Capacity-building may warrant intervention in one domain, but non-intervention in the other.
This is arguably the case in Howard s liberalism. If individuals are to effectively assume more responsibility for their well-being and life outcomes, they need to be sufficiently resourced. This argues for measures that maximise wealth and the availability to individuals of material resources. In other words, an efficient and productive economic market. A capacity-building government might then opt for two things. Firstly, it would likely opt for minimal or no government intervention in the economic domain, to free it up, in the hope of enabling individuals to take initiative and assume risks, in turn increasing the range of economic choices and efficient, market productive outcomes. Secondly, it would endorse an economic safety-net to ensure a minimal level of well-being for those who cannot, due to circumstance, ensure it themselves.
Civil society is another domain within which there are resources for individuals to more effectively assume responsibility for their well-being. Howard emphasises, throughout, the importance of people assisting each other through the medium of the various voluntary associations in civil society that they can form and participate in. Voluntarism, local community or neighbourhood action, and community-partnerships are recurrent motifs in Howard s approach to government. But if the interactions and associations of civil society are to play this supportive role effectively, civil society needs to be a sufficiently stable and predictable forum for individuals to engage with each other in an enduring way.
This suggests that capacity building in the social sphere, unlike the economic market, might call for government interventions of certain sorts interventions that either reinforce (or prevent challenges to) the traditions, institutions, shared life and common values, goals and purposes that help to bind, and give identity to, the mainstream Australian community. In other words, to emphasise in policy or in rhetoric, the things about social life and civil society that unite rather than highlight differences between citizens. Understood like this, capacitating civil society is a matter of strengthening civic bonds, commonalities and continuities. And, as mentioned, this may entail government policies and approaches that promote traditional values (e.g. the primacy of the family unit), or defeating challenges to tradition (e.g. as with gay marriage or assisted reproduction for lesbian women), or emphasising the policy importance of circumstances and events that mobilise social dispositions to unity (e.g. terrorism and threats to border security). Populist policy formation can indirectly play a role, as well, to the extent that it allows government to present itself as a reflector, and reinforcer, of something like the general will, or the common voice.(19)
Once the goal of devolution is seen as primary and fundamental in Howard s philosophy, the other two seemingly antithetical goals of (qualified) non-intervention in the economic sphere and (qualified) intervention in the social sphere, can be reconciled with each other. Economic liberalism and social conservatism are central to Howard s conception of Liberal Party commitments not as somehow coexistent, fundamental values, but as necessary conditions for effective devolution, each targeted to the different sorts of capacity that devolution requires in different spheres of life.
Balancing the Liberal and the Conservative Strategies
None of this changes the fact that Howard s economic liberalism and social conservatism are still in tension, even if they do aim to serve the same fundamental goal. This means each can defeat the other if they are not pursued in the right balance. Promoting individuals freedom in the market, although it may be efficient, resource maximising and capacity-building, inevitably disposes individuals to pursue their personal values and choices in the social sphere. And those personal values and choices may be ones that do not conform to the social continuities, institutions and traditions that a social conservative like Howard might see as essential to social unity. They may, on the contrary, contribute to strengthening those differentiating identity groups and special interest groups (based on ethnicity, sexual preference, social class, etc.) that Howard s brand of social conservatism rejects as socially divisive. Or else, they may act to undermine common social values and traditional stabilising institutions, as, say, gay marriage and lesbian access to IVF might with regard to the traditional nuclear family.
Similarly, the active state promotion and sponsorship of traditional social norms has the capacity to restrict the openness of the economic market. Promoting the traditional family and maternal carer, may limit who can enter the market, and how much in the way of personal resources individuals can accrue in order to be self-supportive .
Checking and moderating the impacts of the liberal strategy against the conservative will be an ongoing and difficult task. There is danger also of confusing the electorate, which may come to see freedom and choice as values extolled in the one domain of life, but down-played at significant points in the other domain. Negotiating this potential confusion would call for careful and targeted political communication.
Collective Responsibility versus Civic and Individual Responsibility Where Does John Howard Draw the Line?
Devolution of obligations and responsibilities away from the public sphere and toward the private, is something that occurs on a continuum, as a matter of degree. There can be more or less of it. Clearly, from what has been argued just above, John Howard appears to conceive the current mission of the Liberal Party to be that of bringing about more devolution. But how much more? At what point, in John Howard s conception of good politics, is it no longer justified to expect individuals, or the supportive neighbourhood associations they might form in civil society, to bear responsibility for their own well-being? Up to what point, and in what conditions and circumstances, should the state accept responsibility for its citizens wellbeing?
Howard does say some things that give an indication of this. For example, the state is obliged to provide a safety-net, a leg-up , for those who need it. There is an obligation on government to ensure that all have a fair go , an equal opportunity:
We want a united Australia, proud of its distinctive identity and history in which all Australians, irrespective of social background, ethnic heritage, religion or nationality have an equal opportunity to achieve what they might want for themselves and their families.(20)
Little of any systematic nature, however, is said about what Howard s conception of an appropriate safety-net, or equal opportunity is. Even less is said as to why these responsibilities should be collective ones, discharged through the agency of the state.
The upshot of this is that even if the apparently conflicting political themes in Howard s Liberal Party philosophy can be woven together by taking devolution as its underlying and primary philosophical goal, it is still relatively unexpressed as to just what degree of devolution is justifiable, and what the justification for that degree consists in.(21)
A Deeper Theoretical Basis?
As has been argued, Howard s economic liberalism and his social conservatism are means of realising the more basic decentralist/devolutionist ideal. This, though, still leaves open the question of what fundamental political perspective that decentralist ideal is pursued in the name of. Does Howard hold that the relation between state and society should be one of devolution and decentralisation because he sees this as required by basic liberal political principles, or as required by basic conservative political principles? The truth is, elements of both philosophical liberalism and philosophical conservatism support the idea of the non-interventionist state. It can be seen as an implication of the view that individual freedom or autonomy is the paramount political ideal, and control over individuals lives should ultimately be theirs. Or devolution to the civil sector, and the capacitation of its unifying neighbourhood associations, can be seen as a reflection of the conservative communitarian view that the true source and moral authority of individual s choices resides in the communities they inhabit. Little, if anything, that Howard says throws light on this important question. And indeed, the unresolved issue of where the line should be drawn between collective and individual responsibility, is symptomatic of the absence of this deeper theorising.
Are the key election policies most emphasised by the Liberal Party in its 2004 election campaign launch consistent with this devolutionist ideal, or what might be required in either the social or economic domains to facilitate it?
To a significant extent, the 2004 election was perceived by both of the competing major parties as turning on issues of health, education and economic management (particularly tax policy). The issues in the health area were primarily focused on Medicare and declining bulk-billing rates, and to some extent, pharmaceutical subsidies. The health policies of both parties reflect this focus.
What might be expected in health policy from a party committed to small government and the devolution of responsibility to individuals and civil society? Arguably, it would be expected that there would be a tendency toward decreased (or at least, not increased) commitment on the part of government to subsidise the costs of people s health care, and an increased commitment to individuals themselves paying their own costs. Some existing elements of the Howard Government s long term health strategy namely, its sponsorship of private health insurance, and its policy to increase the patient co-payment for pharmaceutical benefits are very consistent with these expectations. However, when it comes to its specific 2004 election policies concerning Medicare, there is significantly less consistency.
The original purpose of Medicare was to ensure as much as possible that a person s access to medical care did not depend on his or her capacity to pay. The availability of bulk-billing plays an important role in Medicare achieving this purpose. In the years preceding the 2004 election, however, there had been a consistent decline in the rate at which services were bulk-billed, particularly among GPs. Correspondingly, there had been an increase in patient-billed services, where patients were asked to contribute an out of pocket payment for their medical services.
The avowed thrust of the Liberal Party 100% Medicare policy measure, which incorporated parts of the Strengthening Medicare strategy announced earlier in 2003 04 (including Medicare Plus and other incentive measures to encourage GPs to bulk-bill), was to stem the decline in bulk-billing rates, and to also reduce the corresponding rise in patients out-of-pocket costs. The two central components of that policy that are perhaps of most interest to the issue of principled justification were its creation of a new concessional safety-net for out of pocket costs (as part of the Medicare Plus measure), and its raising of the Medicare rebate for all GP services from 75 per cent or 85 per cent to 100 per cent (whether the service is bulk-billed or not).
It should be observed straight off, that the idea of a state-based social insurance scheme where health risks are pooled and the state acts as insurer, does not fit easily with the devolutionist push in current Liberal Party philosophy. Certainly a health-care safety-net arrangement is consistent with that approach, but Medicare is more than that, given its subsidies are available to all, regardless of their independent capacity to pay.
One possible explanation for this ongoing endorsement of Medicare is the Liberal Party s recognition that it is a solidly established feature of Australia s institutional landscape, and is generally accepted by Australians of all political persuasions. Arguing against it now would be an electoral liability, (although that may not have been as true in the early days of Medibank or Medicare, when there was opposition to it from within the Liberal Party.) This acceptance of the status quo, however, does not explain the two central elements of the Liberal Party s 2004 Medicare policy which seem most incompatible with the party s devolutionist, privatising theme.
The proposal to increase the Medicare rebate to 100 per cent of the scheduled fee reduces the need for the users of the health insurance scheme to pay. Those users include doctors as well as patients. When 100 per cent of the scheduled fee is covered by Medicare for bulk-billed services, doctors do not have to absorb (i.e. pay) any balance of the fee, as they would have under the previous arrangements where only 75 per cent or 85 per cent of the fee was covered by Medicare. Similarly, whereas previously, if a service was not bulk-billed, patients had to pay the remainder of the asked fee. Under 100% Medicare, they would only have to pay what the doctor charges over the scheduled fee, which would typically be less than under the previous arrangements. In both cases, the users pay less, and more is paid collectively, through the agency of the state. A situation that seems quite inconsistent with the user-pays thread in devolutionist politics.
This philosophical inconsistency becomes even more pronounced in relation to the proposal to introduce a safety-net for out of pocket costs for concessional patients (i.e. those who are welfare recipients). There is no doubt that the notion of a safety-net is central to the capacity building dimensions of Liberal Party devolutionism. Those who are unable to afford those costs should have the leg-up John Howard speaks of. But clearly, only when they need it. The data and evidence existing at the time indicated that there may not have been any need for such a new safety-net, and that concessional patients were not at any greater risk of high out of pocket costs than general patients.
Proposing a separate concessional safety-net with a lower threshold than for general patients presumably reflected a view that concessional patients were at a higher risk of being faced with unaffordable medical costs than general patients. There are three possible ways in which this risk might be higher:
Concessional patients were more likely than general patients to access services that are not bulk-billed (and have to pay out of pocket costs). The evidence, however, suggested that GP bulk-billing rates did not vary greatly between different income groups.(22)
Concessional patients accessed a higher number of medical services than general patients. There was little data comparing services accessed by concessional and non-concessional patients. However, a proxy measure of medical services accessed by over 65 year olds does not support the contention that concessional patients accessed more services than non-concessional.(23)
The same level of out of pocket costs would have been less affordable for concessional patients than for non-concessional. It is generally the case that concession card holders have less disposable income, and the same out of pocket costs for them will be a higher proportion of their income than for non-concession card holders. With this said, however, concessional patients are, on average, charged less for services than non-concessional, and the rate of increase in average patient payments was less for concessional patients than non-concessional between 1996 97 and 2002 03.(24)
The available evidence, therefore, did not support the need for a concessional safety-net. That evidence, moreover, was departmentally held, public or publicised (through Senate Estimates hearings) and openly available to the Health Minister at the time the Liberal Party developed its Medicare policy. The upshot of this is that the Liberal Party, in the case of its Medicare policy in the 2004 election, acted contrary to its avowed political ideals, even when this involved measures that were not supported by the best available evidence. The push away from the party s core ideals in this case, must have had a strong motivation.
What might that motivation have been? One likely explanation revolves around the fact that the situation with Medicare was a primary focus of inter-party competition in the 2004 election. For the Liberal Party, that competition could arguably have taken two forms. The first option would have been to have maintained integrity to its principles of devolution and user-pays, and to have decided not to support Medicare. However, given the popular support for Medicare, that option would likely have led to significant electoral loss. The other option was to recognise the popularity that the health insurance scheme had, acknowledge that declining bulk-billing had come to reflect poorly on the government s health-management, and to compete with the ALP on its own ground by seeking to do better what the ALP presents itself as doing well. Of these two options, it could be argued that the Liberal Party opted for the latter because it sought to maximise its electoral advantage.
Harking back to the conceptual distinctions made earlier, this suggests that the Liberal Party made a strategically principled trade-off. It may have decided that to act with strict integrity to its devolutionist principles in this instance would have been to create a very serious impediment to winning the election, and to maximising the realisation of its ideals overall (including in other key areas such as industrial relations, security and education). Given the pivotal role of Medicare issues in the election, the choice for the Liberal Party was to stick to its user pays principles in health, and jeopardise the election (and the broader realisation of its ideals), or to avoid that serious potential loss and reconcile to acting against the grain in the case of Medicare. In doing the latter, the Liberal Party arguably acted in a strategically principled way.(25)
While this strategic approach may have made sense, another quite similar high profile aspect of Liberal Party health policy was not pursued in the same strategic vein, but strongly in line with the party s devolutionist principles. This was the case of the Liberal Party s proposal to increase the patient co-payment for medicines subsidised under the PBS. This proposal was very consistent with the user-pays dimension of devolutionism, and the Liberal Party s adherence to it can be seen as a strong example of integrity to its principles.
But strangely, this policy issue shared some of the key characteristics that argued for a strategic approach in the case of Medicare. As with health-care subsidised under Medicare, the heavy subsidisation of medicines under the PBS was a well-established and broadly popular arrangement. There was considerable public and political opposition to the idea of increasing the share of costs paid by individual patients, and decreasing that paid collectively through the state. From a strategic point of view, it was reasonable to suppose there were significant electoral risks in sticking to principle and pushing for a co-payment increase. Moreover, that increase was not strongly warranted by the evidence, contrary to what was portrayed by the Coalition Government. The Government had consistently publicised, as its justification for the rise, that the cost of the PBS to the Government (i.e. to society collectively) had been rising at an average annual rate of around 14 per cent over the previous decade and would continue to do so, if left unchecked. However, a closer look at the cost trends for the PBS over this period suggest that that average was high due to a glitch during 1999 2000, and also that the future rate of increase could be expected to be significantly lower.(26) In view of this again information available to the Minister through the Department one might have expected a less aggressive push for a co-payment rise (i.e. a push for a smaller rise), especially in view of the possible electoral impacts that may have eventuated.
The important point to emerge from this is that, in the context of very similar policy options under similar background conditions, the Liberal Party acted inconsistently when it came to pursuing its core values. In the one case, the Liberal Party saw it as important to forego strict adherence to its core values in order to strategically maximise them overall. But in the very similar other case, it saw it as more important to stick to its principles at the risk of jeopardising its potential electoral success and strategically maximising achievement of its ideals overall. It is not clear why the two policy cases were treated differently why, with one, the core principle of user-pays was paramount, but with the other very similar issue, that principle was tradeable.
While the Liberal Party s 2004 election flagship social policy diverged from the party s core philosophical commitments in various ways, this is not so with its flagship economic policies.
The Liberal Party s small business policy was very much devolutionist in thrust. Its two components increasing the resources to small businesses via tax reductions and discounts, and reducing regulatory burdens on small business were a reflection of the devolutionist commitment to capacitate the civil and private spheres so that individuals could exercise their freedom and take responsibility for their well-being. Business entrepreneurialism is highly consistent with themes of private and civil responsibility and individualism central to Howard s devolutionist approach.
The situation was similar with the Howard Government s workplace and industrial relations measures. Those measures again reflected John Howard s commitment to business entrepreneurialism and individual initiative in the domain of civil society. Elements in the policy that related to standardising and reducing the complexity of awards and regulations, and providing for mediation to resolve workplace disputes, all strongly reflected a push away from centralised oversight and regulation of the workplace. Consonant with this, and the perceived importance of individual choice and responsibility, was the policy s reinforcement of individually negotiated Australian Workplace Agreements as an alternative to collective agreements. Throughout the policy, the rationale given for devolving workplace discretion and responsibility away from the state and toward the civil and private domain, was that this would increase efficiency, productivity and, in turn, living standards.
The Liberal Party s tax policy has consistently been one of tax cuts, reflecting the view that resources are most effectively used in private hands, and that individuals ought to benefit as much as possible from their initiative and enterprise.
Keeping in mind that this brief survey of policy is a snapshot, the impression emerges that when it comes to its flagship economic policies, the Liberal Party was very faithful to its avowed ideals and principled commitments, with few if any strategic trade-offs being made. In the social domain, however, this principled integrity was less apparent. Although Medicare policy did not exhaust the Liberal Party s social policies, it was nonetheless high profile, and in its detail, the thrust appeared directly contrary to the party s core values. As was suggested, perhaps the most charitable way to explain this is in terms of inter-party competition and the party acting in a strategically principled way. It is also true that another key element of the Liberal Party s health policy strategy its private health insurance incentives and rebate was heavily consistent with devolutionist principles. So, taking health policy more broadly, it was not as unfaithful to principled integrity as the Medicare component of it.
With this said, however, the running together of inconsistent value perspectives in the one policy area ran the risk of confusing the message the party wanted to convey about its values. Even when strategic considerations were factored in to make sense of this, a further inconsistency in approach came to the fore the Liberal Party s policy on pharmaceutical subsidies and co-payment increases. The very factors that may have pressed for a strategic approach to principle in the Medicare case, all applied in the case of the party s proposed co-payment rise. But a similar strategically principled approach in that case was not adopted, and the party strictly adhered to its core values.
As was said, the analysis here is brief, and the range of social policies analysed is limited. But, they were nonetheless policies at the centre of competition between the parties, and on which a lot of attention may have been focused by those interested in discerning and differentiating value differences between the parties at election time. The impression has emerged here that the Liberal Party did not do as good a job as it might have in communicating what it stood for with these most prominent of its social policies.
These internal value inconsistencies in the social policy area could have been due to a range of possible factors. For example, polling information available to the party may have indicated that the electorate was tolerant to PBS co-payment rises, but less so to the then current state of Medicare out-of-pocket costs. But there is another possibility one connected with the observation made earlier that Liberal Party values are unclear on when a citizen s well-being is their own responsibility, and when it is the responsibility of society collectively through the state. The Liberal Party drew that line differently in the case of citizens out-of-pocket costs for medical treatment, and their out-of-pocket costs for medicines. Moreover, in the absence of a determinate conception of what costs are the individual s responsibility, and what are society s collectively, there will be no determinate way of deciding what is being lost and what is being gained by way of party values when the party makes strategic trade-offs such as the one conjectured above with Medicare.
There has been considerable debate, reflection and energy spent by the Labor Party in recent years on how best to refine, re-define or reinvigorate its philosophical identity. That sort of activity, along with changes of leadership and rumours of change, is not unique for a political party that has been out of power for some time, after having a long run in government. The Liberal Party underwent similar experiences in the 1980s after losing power to Hawke s ALP. Recently, the Labor Party has undergone a review of its policies (conducted internally by Jenny Macklin), as well as an external review of party structure, conducted by Bob Hawke and Neville Wran.(27) There have also been calls for further diagnosis of party policy in the wake of the Labor Party s defeat at the 2004 election.
This indicates that the Labor Party s principled commitments are in a transitional condition. Moreover, even within the one set of commitments, different emphases and priorities may be endorsed by different factions within Labor. With this said, however, the Labor Party does have a substantially sized party platform in which it expressly documents its values and principled commitments. Also, both before and immediately after the 2004 election, the then Labor leader Mark Latham made a number of key speeches which indicate where the Labor Party saw its principled commitments around the time of that election. Both of these sources will be relied on here to discern a conception of the core values that the Labor Party generally endorsed at the time.
It does not take long to recognise that there are intersections and points of overlap between the values and principled commitments expressed by the Labor Party in its current Party Platform document, and those endorsed by the Liberal Party under John Howard s leadership. The Labor Party endorses the standard small l liberal commitment to the freedom of individuals, and equal opportunity to social benefits, for instance, as well as the opportunity for individuals to reach their full potential(28) all of which have a strong presence in Liberal Party philosophy. Similarly, the Labor Party, along with the Liberal Party, expresses a commitment to a strong and productive economy, to ministering to those in need through state provision of welfare, to the role of the community, the private sector and the associations of civil society in achieving important goals and outcomes, as well as government-community partnerships.
While the Labor Party embraces these same ideals of equality, individual freedom, self-development, individual initiative, individual responsibility, and civil associations and community partnerships, it differs from the Liberal Party in a number of important ways. Firstly, it does not attach the same relative priorities to these ideals as the Liberal Party. While the Liberal Party gives primary importance to the place of the private sector and civil associations, the Labor Party Platform statement ranks these as seventh in importance, after the likes of fairness, freedom, compassion and democratic participation. Similarly, Labor gives first importance to the state provision of welfare and caring for the needy, while the Liberal Party does not treat the safety-net as its first priority. Secondly, the Labor Party sees a central role for the state in maintaining certain social outcomes or ongoing social conditions, while the Liberal Party sees the role of the state largely in terms of setting in place certain initial baseline conditions for citizens to have the same opportunity to engage in social life. The Labor Party, for example, sees certain outcomes as important (e.g. an equitable distribution of wealth, income and status; that the benefits of productivity are not concentrated in the hands of the few). It also sees as important the ongoing participation of citizens in social decision-making, and workers in workplace decisions. These sorts of outcomes require government to play an ongoing monitoring, interventionist and re-distributive role. The emphasis for the Liberal Party, on the other hand, is on ensuring basic initial conditions , namely, resources and capacities on the part of individuals and civil society, so that responsibilities for social and personal outcomes can be effectively devolved from the collective public sphere to the private civil sphere.
Though there are other differences between the Liberal Party s values and the Labor Party s commitments and priorities as expressed in the party platform,(29) the central dimension along which they differ can be characterised in terms of the relative role in politics and society of the state or public domain and the individual or private domain. While the devolutionism of the Liberal Party commits it to according government less and less a role, Labor s platform sees the state as having a much more robust and active part to play. For Labor, the state is essential in sponsoring and coordinating social programs to achieve and maintain fairness, and ratifying and enforcing the entitlements of workers to collectively participate in workplace decision-making. For Labor, the state and its institutions are also essential for citizens to equitably and effectively participate in decisions that affect social outcomes, and to participate in the benefits of national prosperity and economic productivity. Even when the Labor Party, in its 2004 platform, notes the importance of civil society and community organisations in building a sense of community and serving people s needs, this is still seen in partnership with the state.
The Platform statement accorded special importance to the role of government in achieving a more equitable distribution of wealth, income and status, and a secondary, more supplementary role for the community and private sector in serving social needs and goals (and even then, only in partnership with government). However, the party vision and values speeches by Mark Latham just before the 2004 election and immediately after it, provide a different emphasis in relation to these themes. While fairness for the Platform meant equal opportunity and equitable distributions of wealth and status, for Latham a fair society was one in which government helps out people willing to help themselves.(30) Hard work, reward for effort individuals taking some responsibility for their life outcomes were strong features of Latham s ladder of opportunity views. These are less prominent in the party Platform. This is not to suggest that the social investment role of government was not present in Latham s portrayal. It was. But the emphasis was weighted toward equalising people s life opportunities (via e.g. early childhood education, secondary and tertiary education, etc), and resourcing families and capacitating communities (e.g. public housing) for them to be in a position to care . Latham s vision of the Labor way was to build that powerful combination of hard work, good families and communities, and the collective civilising role of government .(31) While the party Platform shared elements with the principled commitments of Howard s Liberal Party, those commitments especially their devolutionist flavour echoed more strongly in the Laborism depicted by Latham. For Latham s Labor Party, fair and just life outcomes for people were those that emerged from individual initiative and responsibility, exercised in the context of an equal life start for all and an effective private and civil sector. The role of government was to coordinate the equal start and capacitate the civil sector to allow people to be more fully and effectively self-reliant (32), an agenda familiar from Howard s Liberalism. Latham s Laborism diverged from party platform Laborism in the stronger emphasis it placed on individual and civic responsibility for individuals well-being and life outcomes.
This emphasis is even more pronounced in Latham s post-election analysis of what he took to be Labor s need to revitalise and modernise itself, especially with respect to economic management.(33) The central thrust of Latham s view here was the need for Labor to base its economic strategy on economic flexibility, enterprise and upward mobility. It needed to recognise that working life had become decentralised in the sense that individual workers were more entrepreneurial and self-reliant, and increasingly geared to small business enterprise. Inequality was still a central concern for the Labor Party, but Latham claimed that it is inappropriate to tackle inequality by levelling down economic success, by punishing the successful to make the less successful feel better .(34) What was needed instead, were enterprise, creativity and entrepreneurialism fuelled by skills and education, and a rising tide of economic growth based on increased productivity and competition in an inclusive economy. For Latham, social justice was upward mobility for all meeting the aspirations of the middle class while providing life opportunities for the poor. Reminiscent of the Howard devolutionist agenda of government capacitation of the private sector, Latham claimed that the role of the modern Labor Party is to establish fair market rules to empower workers, contractors and entrepreneurs to do more for themselves .(35) And all of this was to be underpinned by surplus budgets, a lean public sector and downward pressure on interest rates. (36) This was what Latham described as upward mobility all-round .
There was a distinct devolutionist thrust in the economic strategy Latham proposed for Labor, with government providing the background conditions and opportunities for individuals to thereafter assume responsibility for their life s economic outcomes. On this economic picture, individuals and the state would share responsibility for individuals economic outcomes. And individuals wealth (privately acquired resources) should not be unduly appropriated (through extensive redistribution/high tax rates) by the state, for public use. There was a move away in emphasis from the re-distributive thrust of the party platform, and earlier interpretations and emphases of Labor values.
When it comes to social policy strategy, however, what Latham proposed for Labor was more in line with the emphasis of the party Platform, and less devolutionist. It endorsed the public provision of universal access to the likes of e.g. health services and educational opportunities to all, along with the public provision of whatever social and economic programs might be needed from time to time to facilitate the goals of economic aspiration (climbing the ladder of opportunity), and the avoidance of poverty traps. By public provision was meant public payment, and not necessarily centralised delivery of programs and services by government. Latham, like Howard s Liberals, advocated the decentralisation of social (and other) service delivery from the state to the civil sector. This outsourcing of service delivery where government pays for services provided by the private sector with its existing service infrastructure, was in keeping with the goal of a lean public sector . Latham described this harnessing of private sector resources for progressive public purposes as an efficient way of achieving equity goals. Unlike Howard s Liberalism, however, this did not mean devolving to the civil or private sector or to individuals, the responsibility for sharing the costs of social service provision. Social programs for the public benefit are still paid for collectively by the state.
In summary then, the Labor Party in the context of the 2004 federal election, tended toward being economically liberal and individualist and socially collectivist. Outcomes in the economic domain the distribution of wealth and income were to be a shared responsibility between individuals and society collectively. Outcomes in the domain of social needs, however, were primarily a social responsibility, to be assumed by the agency of the state, and in turn, society collectively.
How faithful to these commitments were the ALP s flagship economic and social policies in the 2004 election? What degree of principled integrity did they reflect, and to what degree might there have been strategic trade-offs, and at what risk to the Labor Party s philosophical identity?
Along with health and education, tax policy was one of the major foci of policy competition between the two major parties in the election. The Coalition s campaign strategy against the ALP ostensibly involved two dimensions. The first was arguably to compete with Labor on its own ground and to present itself as better than Labor at what Labor traditionally presents itself as doing best health and education. The second was to accentuate what Labor is sometimes regarded as not doing as well as the coalition economic management and fiscal policy. In line with the second dimension, there was considerable attention on Labor s tax policy. As it turned out, whatever else might be said about the tax policy Labor put forth, it was arguably highly consistent with the principles avowed by Latham for the economic domain as outlined above.
The Labor Party tax policy package had a number of components:
- The Working Tax Bonus delivering tax cuts through changes to the income tax thresholds;
- The Better Family Payment Plan simplifying the existing family benefit arrangements and increasing financial assistance to families;
- The Tax Free Guarantee for Families allowing families with dependent children under 18 to split incomes and pay less tax; and
- Families in Work increasing the level of support to jobless families to facilitate their return to work.
The avowed aim of the increases in the income tax thresholds was to reduce the penalties for hard work . This fits strongly into the Latham philosophical themes of rewarding effort, climbing the ladder of opportunity, helping individuals to help themselves. The Working Tax Bonus also reflected Latham s de-emphasising of redistribution in the economic domain. Not only were tax thresholds increased for lower and middle income earners, they were also increased for high income earners who, as a consequence, also end up with higher disposable income. There was no levelling down or levelling up in the income tax policy. There was also a clear devolutionist element in Labor s approach to the existing contributions tax on superannuation contributions, which was to reduce it from 15 per cent to 13 per cent. Its long-term plan was to eliminate contribution tax altogether, completely removing the disincentive for people to fund their own retirement through superannuation savings. Compulsory superannuation was initiated by Labor originally, and its clear aim was to devolve responsibility for individuals retirement support to those individuals themselves, rather than the state through pension assistance. Reducing the tax by 2 per cent per annum was a further devolutionist step in the economic area.
The Better Family Payment Plan and The Tax Free Guarantee for Families measures sought to provide greater disposable income, fewer disincentives to work (as opposed to welfare), and flexibility in working arrangements for parents with dependents. All of these were very consistent with the choice, flexibility and initiative themes in Latham s economic principles for Labor. And again, where a re-distributive levelling out element may have been expected from earlier Labor ideals, it was absent with the Better Family Payment Plan measure. Those families with a combined income of nearly $90,000 per annum were still intended to be eligible for payments under the measure, and moreover, higher payments than under the existing coalition arrangements.(37) Finally, the Families in Work measure was designed, as the policy document says, to help jobless families to help themselves, and to remove inter-generational poverty traps.
Just as Labor s flagship economic policy was highly consistent with its avowed principles in the economic domain, so too was Labor s flagship policy on Medicare consistent with its core values regarding social policy. However, reminiscent of the Liberal Party, the Labor Party can be seen to have made certain strategic trade-offs in connection with another high profile health policy area again the proposed patient co-payment increases for the PBS.
As with the Liberal Party, Labor took the problem with Medicare to be declining bulk-billing rates. However, unlike the Liberals, Labor consistently described this as a problem of universal access to publicly funded health services, and the measures Labor proposed in its Medicare policies were geared to increasing access and universality. Those measures included:
- Providing a 100 per cent rebate to doctors who bulk-bill;
- providing monetary incentives to doctors to bulk-bill, with higher incentives targeted to areas of need; and
- extending the health-care workforce, including provision of extra training places and incentives for after hours services;
While the New Deal to Save Medicare proposal addressed problems within the existing framework of Medicare, Medicare Gold sought to extend that framework to provide free hospital treatment to those over 75, regardless of means. The New Deal initiative was motivated primarily on grounds of concerns about universal access to health care. Medicare Gold had universal access as a motivator, but it was also put forward in the name of promoting health-care efficiencies, more timely provision of needs-based access, and reduced private health insurance costs for individuals (including those under 75 years). Medicare Gold sought to achieve these through the following means:
- increasing the funding to public hospitals to provide free services to over 75s;
- negotiating fee schedules and services with private hospital providers for in-hospital services to over 75s;
These measures were proposed to bring about the following health care benefits:
- reduction in waiting times in public hospitals for all age groups;
- reduction in private health insurance premiums for all subscribers through reducing the costs of providing services to over 75s by private health insurers (where reduced costs would be passed on as reduced premiums for all);
- removal of existing incentives for the Commonwealth to under-fund aged care by shifting costs to the state-based public hospital system. If the Commonwealth took over funding for public hospital beds for over 75s, there could be no cost shifting between jurisdictions, and this would have been an incentive for the Commonwealth to provide sufficient aged care places.
Both of these flagship Labor Party social policies strongly reflected a commitment to collective responsibility for the costs of individuals health care. Individuals health is a shared responsibility, discharged through the state and its public instrumentalities, rather than an individual user pays responsibility. For example, all the initiatives designed to facilitate bulk-billing, have the effect, if not the purpose, of reducing out of pocket costs and the extent to which the individual user pays for their health care. The same applies with free hospital treatment for over 75s users who are in a generally weaker position to pay. The shift away from the individual toward collective and shared responsibility in the Labor Party health policies even extended to transactions in the private sector, in the way of reduced premiums for individual consumers of private health insurance. The Labor Party s philosophical theme of centralisation collective and shared rather than individual responsibility for costs was very strongly reflected in the Labor Party s 2004 flagship social policies.
There are, of course, exceptions to this high degree of principled integrity. One obvious, and frequently cited, instance was Labor s position regarding the Private Health Insurance Rebate (PHIR). It would be reasonable to assume that a political party geared in principle to treating health care as a shared and public responsibility would be unhappy with the idea of publicly subsidising (through a rebate) individuals payments for their own health care. Principles of centralised collective responsibility for people s health would not easily countenance an individual user-pays regime, nor the public subsidy of such a regime.(38)
There was another principled tension in the health policy domain, one that was relatively prominent in the context of the 2004 election. This is in the case of what has sometimes been described as the Labor Party backflip on PBS patient co-payment increases.
The PBS Co-payment Rise Labor Values in Tension
In 2002, the Coalition introduced a bill to increase the patient co-payments for medicines subsidised under the PBS. The Labor Party had been consistently and overtly opposed to this increase for the two years since. To increase PBS co-payments is to increase the amount that users of subsidised medicines have to pay. It is a user-pays social policy measure, and ostensibly at odds with the standard Labor philosophical approach to health policy. But in the context of the 2004 election, the ALP changed its position, and agreed to let the bill proposing this increase pass. The reason presented for this change was Labor s perceived need to have sufficient revenue to finance its election undertakings, were it to win office. Internal party assessments would have judged those undertakings unlikely to be fully funded under the rising costs to government of subsidised medicines. Moreover, it was unclear how great the savings would be from reforms Labor proposed in relation to generic medicines. Given this uncertainty, Labor undertook to allow the coalition s co-payment bill to pass. Importantly, it also undertook to review this decision once it became clear what level of savings would accrue from the generic medicines reforms.
In the circumstances then, Labor could not adhere fully to its collectivist social principles without compromising its economic policy principles of sound economic management. Labor had the choice of sticking to its egalitarian guns about affordable access to medicines and leaving itself with a funding deficit for future programs; or it could accede to the co-payment increase and secure itself as a sound economic manager, capable of balanced budgets.(39) Ostensibly, the Labor Party s social principles were traded-off against its economic ones, and its values of sound economic management prevailed.
As was said in the previous chapter, it is sometimes the case, and not unusually so, that a party s own principles compete with each other for priority. Sometimes they just cannot all be respected to the same degree, and a choice needs to be made between the values to realise in the situation, and the ones to let go by on the occasion. What is important, and most revealing, however, is what trade-offs are actually made, and on what basis.
In acceding to the co-payment increase, the Labor Party acceded to a measure that was in direct tension with its avowed principle that individuals health needs are substantially a shared social responsibility. Compounding this, 43 per cent of the revenue raised by the co-payment increase would have come from those on concessional incomes. Labor could be seen to have made these substantial compromises of principle in order to give priority to the party s value of sound economic management low national debt, low inflation and balanced budgets.(40) However, as important as economic management (understood as balanced budgets, low debt, etc.) is in Labor Party ideals, it is generally given less priority overall than social support for citizens needs. This raises the question of why, on this occasion, the former value was elevated to a priority it does not traditionally have. One possible explanation is that Labor considered it crucial for electoral reasons to be seen as economically responsible, particularly in view of a strong push by the Liberal Party in the 2004 election campaign to label the Labor Party as a poor economic manager. Seen in this way, the Labor Party can be understood as having made a trade-off on strategic grounds so as not to allow itself and its policy agenda (and ultimately the realisation of its broader ideals) to be disadvantaged electorally.
There is a strong sense that in the special context of the 2004 election, the Labor Party was competing with the Liberal Party on Liberal Party ground. Just as the Liberal Party sought to compete with Labor by extending the Medicare safety-nets, the Labor Party arguably sought to compete with the Liberal Party on sound economic management, an area the Liberals traditionally portray as one of their strengths over Labor. In each case, the motivation was strategic, and designed to maximise each party s prospect of realising its ideals and values more broadly and substantially, through winning the election.
As was the case with the Liberal Party, there was a risk of the Labor Party confusing the electorate as to what that party actually stood for. This was especially so in the context of a high profile issue like PBS co-payments, and the Labor Party s strong previous public commitment not to do what it eventually did.
The Relative Philosophical Directions of the Parties
The foregoing case-study of the parties flagship social and economic policies has provided some detailed insights into how each party modified and negotiated its philosophical commitments and priorities in the context of electoral competition. As it turns out, this case-study also yields some observations about how these internal negotiations have resulted in the parties being situated relative to each others core values. That is, the respects in which the parties expressed values have become further similar or different from each other in the context of the 2004 election competition.
Clearly, the case study indicated that the policy emphases of both parties during the election converged, and ostensibly on those issues that non-committed voters considered most important. This is fairly unremarkable in itself. But in the present case, convergences of a deeper philosophical kind also accompanied this shared policy emphasis in both economic and social policy domains. As noted, the Liberal s flagship economic policies remained faithful to the rendition of Liberal Party values in the economic domain which John Howard had portrayed for some time. However, the ladder of opportunity theme in Mark Latham s portrayal of Labor values in that domain (and the economic policies he put forward in 2004), diverged from party platform Laborism in the greater emphasis they placed on individual and civic responsibility for individuals economic outcomes. This emphasis, it was observed, echoed some of the key elements of Howard s devolutionism. The appearance this gives is that the economic policy principles of Latham s Labor Party were converging on those of the Liberal Party.
In the social policy domain, there is reason to think that both the parties converged on each other in certain respects. The Liberals approach to Medicare concessional benefits suggested a downplaying of their usual user-pays principle, and increased emphasis on collective responsibility for people s needs something more typical of Labor Party social policy values. Similarly, the Labor Party s decision to accede to increased PBS co-payments, betokens a more prominent role for user-pays values and individuals bearing responsibility for their well-being principles more at home in Liberal Party philosophy.(41)
The question these observations immediately present is whether this snap-shot view of values-convergence is representative of the broader, longer-term situation between the two parties. This issue of trends in ideological position and convergence between the major parties will be taken up in the next chapter.
- That the left-right ideological positions of the two major Australian parties are not static or straightforward will become apparent in the next chapter.
- For a fuller defence for using election policy launch speeches for this purpose (and related ones) refer to Chapter Four of this monograph.
- It should be acknowledged that there will be other indicators of parties policy priorities. One such indicator might be the relative amount of funding the parties undertake to devote to the competing policy areas. This may give a rough indication of priorities, but it will be a qualified one given that some policy areas will be intrinsically more expensive to resource than others.
- Latham, 2004b.
- Howard, 2004.
- See Bean, et. al. 2004.
- The policy document for this policy and the other 2004 Liberal Party policy documents cited here are available on the Liberal Party of Australia website at http://www.liberal.org.au/default.cfm?action=2004_policy
- This policy document can be accessed at http://parlinfoweb.aph.gov.au/piweb//view_document.aspx?TABLE=PARTYPOL&ID=853
- This policy document can be accessed at http://parlinfoweb.aph.gov.au/piweb//view_document.aspx?TABLE=PARTYPOL&ID=758
- David Kemp, 1994, p. 49.
- But not entirely, as will be noted shortly.
- John Howard, 1995, The Role of Government A Modern Liberal Approach ; John Howard, The Liberal Tradition: The Beliefs and Values which Guide the Federal Government The 1996 Menzies Lecture; John Howard, 1999, Address to the Tasmanian State Council ; John Howard, 2000, Address to the Melbourne Press Club; John Howard, 2002, Strategic Leadership for Australia Policy Directions in a Complex World . Also appealed to as a source is The Liberal Way Federal Platform, Liberal Party of Australia, 2004.
- Howard, 1996.
- Howard, 2000.
- Howard, 1995.
- Howard, 1995 and 1996.
- Howard, 2000 and 2002.
- Howard, 2000.
- There is also reason to suppose that Howard sees the economically liberal market as playing a capacitating role for the civil sphere as well, when he claims that he had never seen economic rationalism or economic efficiency as an end in itself or a stand alone political credo, but as necessary for united families and communities. See Howard, 1995.
- Howard, 1988, p. 89.
- These absences are of some note, since it is arguably in this matter of the degree of devolution (and why that degree) that the ALP and Liberal Party differ in their core values.
- Department of Health and Ageing, December 2003, p. 4.
- For details, see Rickard 2004b, p. 17.
- Senate Community Affairs Legislation Committee, November 2003, p. 86.
- Another trade-off reflected in the Liberal s policy on the Medicare safety-net was in relation to economic management. The new safety-net was an expensive measure, and its costs subsequently escalated beyond projections made around the time of the 2004 election.
- See Rickard, 2004a.
- Australian Labor Party 2002.
- Australian Labor Party, 2004, Chapter 1.
- For example, the Labor Party s emphasis on reconciliation, respect for difference, and its focus on employed people, compared to the greater emphasis in the Liberal Party on employers (especially small business).
- Latham, 2003.
- op. cit.
- Latham, 2004a.
- Latham, 2004c.
- op. cit., p. 10.
- op. cit., p. 15.
- Approximately 40 per cent higher than existing arrangements. See Rewarding Hard Work , p. 10.
- But, as was conjectured earlier, the position Labor has taken on the rebate might perhaps best be seen as a response to the fact the PHIR is a solidly entrenched feature of the Australian health-care economy, particularly at the micro-level of individuals and families calculating their life-expenses. Even though removing the rebate would be consistent with the letter of Labor principle, doing so (at least all at once) could be seen as counter-productive in various ways.
- Rickard 2004c.
- It might be thought that Labor did this because it would not otherwise be in a position to pay for its broader social program. But this is not the case. Governments have the option, just like individuals, of undertaking some debt to fund its preferences. Schools of thought even advocate this as a quite legitimate ongoing strategy if social circumstances call for it. The fact that the ALP did not opt for this approach suggested that its operative value was not making sure its policy program would be realised, but ostensibly ensuring it would be realised in the context of a balanced budget.
- These case study observations will be corroborated in the next chapter by independent systematic measures of the parties relative ideological positions at the 2004 election.