Health and ageing Health infrastructure

Budget Review 2009-10 Index

Budget 2009 10: Health and ageing

Health infrastructure

Rebecca de Boer

The Health and Hospitals Fund (HHF) was announced in the 2008–09 Budget to finance health infrastructure such as hospitals, medical technology, medical research facilities and projects.[1] Although subject to final budget outcomes, when the HHF was first announced the expected allocation was $10 billion.[2] The first allocation to the HHF was $5 billion from the 2008–09 Budget.[3]

The 2009–10 Budget announced a range of health infrastructure projects. These range from hospitals to support cancer services and medical research and amount to around $3.2 billion dollars.[4] In terms of hospital infrastructure, the Budget announced 17 major projects which total  $1.5 billion.[5] This funding will be spent over seven years, with $104.1 million to be spent in 2013–14, and $10.0 million in 2014–15.[6]

Projects funded by the HHF were evaluated by the HHF Board, appointed by the Minister for Health and Ageing, Nicola Roxon, in November 2008. Applications opened on 19 December 2008 and closed on 19 January 2009. Preference was to be given to:

  • projects that improved acute care facilities, including hospitals, paediatric and specialised mental health facilities and equipment
  • health service infrastructure—primary and community care—focusing on facilities or equipment to support a more integrated approach. A balanced program including rural, Indigenous services and outer-metropolitan will be important
  • workforce training infrastructure—to support innovative approaches to improve the health and medical workforce, to deal with the increase in numbers of people training to be health professionals and to assist in improving distribution
  • specialised cancer care—development of integrated cancer care facilities, and
  • research facilities that are integrated with improving clinical care and/or health workforce training.[7]

Other infrastructure funds have been criticised for a lack of transparency and for the failure to conduct a cost-benefit analysis.[8] The principles and evaluation criteria underpinning the HFF were made public at the time of application.[9] However, the absence of further relevant information means that it is not possible at this stage to evaluate the decisions made by the HHF Board .

The HHF will also fund $1.3 billion over six years to deliver a ‘world class cancer system’ in Australia and $430.3 million over six years to translate research into clinical practice in areas such as mental health and neurological disorders, child health, Indigenous health and medical bionics.[10] A complete list of projects funded by the HHF was not included in the budget papers or in the accompanying media briefing.[11]

Over the Forward Estimates period (until 2012–13), close to $3 billion  of the HHF will be spent. It is important to note that the HHF was funded from the surplus of the 2008–09 Budget and, although there is provision for additional money to be allocated to the HHF, this has not yet occurred. When the HHF was first announced, the Government indicated that the Fund could be worth up to $10 billion,  but that this would be dependent on future Budget surpluses. Given the current economic climate, it is unlikely that there will be a budget surplus in the near future. This makes critical evaluation regarding expenditure of the HHF essential.

[1].    W Swan, (Treasurer), Budget Speech 2008–09, 13 May 2008, viewed 15 May 2009,

[2].    Swan.

[3].    R Webb, C Dow and R de Boer, Nation building fund 2008, Bills digest, no. 67, 2008–09, Parliamentary Library, Canberra, 2008, viewed 21 May 2009,

[4].    N Roxon (Minister for Health and Ageing), ‘Keynote address’, Generic Medicines Australia Conference 2009, Sydney, 19 May 2009.

[5].    N Roxon, (Minister for Health and Ageing), Nation-building a hospital system for the future, media release, 12 May 2009, viewed 14 May 2009,$File/hmedia07.pdf

[6].    Australian Government, Budget measures: budget paper 2:2009–10, Commonwealth of Australia, Canberra, 2009, p. 279.

[7].    Refer to ‘Health and Hospitals Fund’ on the Department of Health and Ageing website, viewed online 18 May 2009,

[8].    G Milne, ‘Missing numbers from nation building plans’, The Australian, 18 May 2009, p. 8.

[9].    Health and Hospitals Fund: funding application and guidelines’, viewed 18 May 2009,$file/Guidelines%20for%20Applicants%20final%20approved%2019%20Dec%202008.pdf

[10]. Budget paper 2, pp 280-282

[11]. However, in a speech made the Minister for Health and Ageing, she noted that $3.2 billion for health infrastructure had been allocated from the HHF – for 32 iconic projects. See See N.Roxon (Minister for Health and Ageing), ‘Keynote address’, Generic Medicines Australia Conference 2009, Sydney, 19 May 2009.