Budget 2011–12: Health infrastructure


Budget Review 2011-12 Index

Rebecca de Boer

The additional investment in regional health infrastructure announced in this Budget has been hailed as a ‘win’ for the regions.[1] Rural health groups have welcomed the measure, but have sounded a warning about the adequacy of the health workforce to support this initiative.[2]

As part of its agreement with the independents to form government, the Government committed to a Regional Priority Round for the Health and Hospitals Fund (HHF). This has resulted in $1.8 billion over six years to support the development of health infrastructure in regional areas.[3] Of this, $1.33 billion (over five years) has been allocated to 63 projects across Australia, including the Royal Hobart Hospital, Port Macquarie Hospital, Tamworth Hospital, and successful projects in Far North Queensland and regional Western Australia.[4] The remaining $475 million has been placed in the contingency reserve to fund a further Regional Priority Round from the HHF.[5] This Round is due to commence before the end of 2011.[6]

The HHF was first announced in the 2008–09 Budget as part of the Rudd Government’s commitment to ‘nation building’. It was one of three nation building funds and $5 billion was appropriated for it in 2008–09.[7] The outcomes from the first HHF funding round were announced in the 2009–10 Budget, and around $3 billion was committed to a range of health infrastructure projects such as hospitals, integrated cancer centres and translational research and workforce training.[8] To date, 85 health infrastructure projects have been funded.[9]

Information from various portfolio budget statements suggests that the total estimated transfers from 2008–09 to 2014–15 from the HHF are around $4.3 billion.[10] This would suggest that the Government has almost allocated the entire HHF. Despite the Government’s ‘Operation Sunlight’ initiative to improve openness and transparency of government expenditure and financial accountability, [11] there is no way to track actual expenditure from the HHF or expenditure associated with specific projects. While the portfolio budget statements provide estimated transfers from the HHF, estimates of expenditure beyond the forward estimates are not publicly available, making it difficult to know precisely how much money remains in the Fund. Estimates of transfers from the HHF are only available up until 2014–15, but Budget measures: budget paper no. 2: 2011–12 notes that there will be funding ($265.5 million) for specific projects in 2015–16.[12] It is not clear whether the $475 million that has been placed in the Contingency Reserve for the additional Regional Priority Round to be conducted later this year has been included in the estimated transfers.

The investment in health infrastructure in regional areas has largely been welcomed by stakeholders as much of this infrastructure is long overdue for an upgrade. However, the data would suggest that there is still much more work to be done in rural health. People living in rural and regional areas typically have poorer health outcomes than their metropolitan counterparts and have limited access to health services. Many regional areas struggle to attract and retain appropriately qualified health professionals.[13] The newly-created regional health agency which has a mandate to ensure a whole-of-government approach to tackling regional health issues[14] may further help to focus attention on these issues.



[1].          A Dick, ‘Funding a win for the regions’, The Land, 12 May 2011, viewed 12 May 2011,  http://theland.farmonline.com.au/news/state/agribusiness-and-general/general/funding-win-for-rural-towns/2160305.aspx?storypage=1

[2].          M Sweet, ‘Some rural reaction on the budget’, Croaky, 10 May 2011, viewed 12 May 2011, http://blogs.crikey.com.au/croakey/2011/05/10/some-rural-health-reaction-on-the-budget/

[3].          Australian Government, Budget measures: budget paper no 2: 2011–12, Commonwealth of Australia, Canberra, 2011, p. 218, viewed 11 May 2011, http://www.budget.gov.au/2011-12/content/bp2/html/index.htm

[4].          For a complete list of all recipients, see N Roxon (Minister for Health and Ageing), Gillard government delivers $1.8billion to improve health services in regional and rural communities, media release, 10 May 2011, viewed 13 May 2011, http://www.health.gov.au/internet/budget/publishing.nsf/Content/1216C4D1A32575B7CA25788A002F4A62/$File/hmedia03.pdf

[5].          Ibid., p. 219.

[6].          Australian Government, Portfolio budget statements 2011-12: budget related paper no. 1.10: Health and Ageing Portfolio, Commonwealth of Australia, Canberra 2011, p. 304, viewed 11 May 2011, http://www.health.gov.au/internet/budget/publishing.nsf/Content/2011-2012_Health_PBS

[7].          R Webb, R de Boer and C Dow, Nation building funds bill 2008, Bills digest, no. 67, 2008–09, Parliamentary Library, Canberra, 2008, viewed 11 May 2011, p. 9, http://www.aph.gov.au/Library/pubs/bd/2008-09/09bd067.pdf

[8].          Australian Government, Budget measures: budget paper no. 2: 2009–10, Commonwealth of Australia, Canberra, 2009, pp. 279–82, viewed 11 May 2011, http://www.budget.gov.au/2009-10/content/bp2/html/index.htm

[9].          Portfolio budget statements 2011-12: budget related paper no. 1.10: Health and Ageing Portfolio, op. cit., p. 304.

[10].        This does not take into account any expenses associated with management fees or revenue and gains, and is based on information from the following portfolio budget statements: Australian Government, Portfolio budget statements 2011–12: budget related paper no. 1.8: Finance and Deregulation Portfolio, Commonwealth of Australia, Canberra, 2011, p. 58, viewed 11 May 2011, http://www.finance.gov.au/publications/portfolio-budget-statements/11-12/index.html; Australian Government, Portfolio budget statements 2010-11: budget related paper no. 1.9: Finance and Deregulation Portfolio, Commonwealth of Australia, 2010, p. 55, viewed 11 May 2011, http://www.finance.gov.au/publications/portfolio-budget-statements/10-11/index.html;          Australian Government, Portfolio budget statements 2009–10: budget related paper no. 1.8: Finance and Deregulation Portfolio, p. 50, Commonwealth of Australia, Canberra, 2009, viewed 11 May 2010, http://www.finance.gov.au/publications/portfolio-budget-statements/09-10/index.html

[11].        Department of Finance and Deregulation (DoFD), ‘Operation sunlight’, DoFD website, viewed 13 May 2011, http://www.finance.gov.au/financial-framework/financial-management-policy-guidance/operation-sunlight/index.html

[12].        Budget measures: budget paper no 2: 2011-12, op. cit, p. 219, viewed 11 May 2011, http://www.budget.gov.au/2011-12/content/bp2/html/index.htm

[13].        Department of Health and Ageing, Report on the audit of health workforce in rural and regional Australia, Commonwealth of Australia, Canberra, April 2008, viewed 13 May 2010, http://www.health.gov.au/internet/main/publishing.nsf/Content/4F3A981914316A11CA257434008189EC/$File/ruraud.pdf

[14].        Portfolio budget statements 2011-12: budget related paper no. 1.10: Health and Ageing Portfolio, op. cit., p. 288.


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