EMBARGOED AGAINST DELIVERY

Hon Peter Dunne
MP for Ohariu
Leader, UnitedFuture

Address To The Rotary Club Of Western Hutt
Boulcott Golf Club
Lower Hutt
Tuesday 9 June 2009 At 7:00 pm

We live in truly remarkable times – economically to be sure, politically and socially.

A year ago no-one would have imagined the depth of the international economic crisis now facing the world.

Nor would we have imagined that the decade of budget surpluses would be replaced by the decade of deficits we are now facing.

A year ago, as Minister of Revenue, I was collecting consistently more revenue than forecast – now we face significant revenue shortfalls.

This time last year the National Party looked odds on to win the election all by itself, and return the country to one-party majority government.

But today, while we certainly have a National-led government, it is supported by ACT, the Maori Party and UnitedFuture, and even the Greens on specific issues.

A year ago, who would have thought Helen Clark and Michael Cullen would be off the local political scene by now, and knights and dames would be very much back in the picture?

This Alice in Wonderland turn of events seems set to continue for the foreseeable future, as international and domestic events unfold as unpredictably as ever.

This is especially so in politics, where the impressive new intakes of both National and Labour MPs at the last election are already having a significant influence.

These new MPs reflect today’s instant world, where decisions are made quickly and decisively, based on a combination of intuition and diverse experiences, and often on a no-regrets basis where it is no big deal to admit things did not work out as intended and have to be changed, and then just move on without recrimination to the next issue.

This is in many senses a refreshing approach, which the Prime Minister typifies, and is one which people are responding to warmly, but, and perhaps because, it is in marked contrast to the way in which politicians of recent generations have behaved.

References to what happened in the 1990s, let alone what side one was on during the Springbok Tour or, heaven forbid, the Vietnam War are utterly irrelevant to the values of this new generation, as Helen Clark found out dramatically last year, and Phil Goff is continuing to find out.

It all serves to reinforce the fact that besides the specific party political changes that occurred, the last election was a generational change in New Zealand politics – in the same way that the elections of 1935, 1972, and 1984 broke the mould that went before them

Since the advent of MMP in 1996 the norm had become for the process of government to be more considered, and risk averse than in the high wire act era of the 1980s and early 1990s.

This new generation of politicians makes that norm look rather staid, but without showing too many signs of reverting to the recklessness of the earlier period.

They are achievers, focused on outcomes, and genuinely keen to make a difference, before moving on to what comes next.

Yet that is not to say there is no place for moderation or reason in today’s politics.

If anything, the current environment should strengthen the hand of the reasonable moderate, more inclined to the long view, than the lead story on the next news bulletin.

There is still a place in New Zealand politics for a party committed to the enduring liberal principles of freedom of expression, conscience and belief, which promotes economic and individual freedom but accepts these must be tempered by social responsibility, and which regards families and communities, in all their richness and diversity, as the basis for a thriving society.

There is still a place for a party that speaks for those many thousands of politically dispossessed New Zealanders who continue to see the National Party as simply too flinty-faced and conservative, the Labour Party as too focused on yesterday’s glory and on promoting the power of the state, and the rest as just too dogmatic or extreme to be a credible political home.

And there is still a place for a party that is proud to seek New Zealand’s future as the best multicultural country in the world, and is unafraid to promote the political and constitutional changes necessary to achieve that.

UnitedFuture’s flame may flicker faintly at the moment, but for those who hold dear those values, and who yearn for centrist politics that seek to draw out the best from both sides of the line in the common interest, it will continue to burn, as a rallying point to ensure balance, reason, and dignity still play a part in our political process.

Just as the last election may have torn up the political rule book, the global financial crisis has torn up the economic management manual.

By the early 1980s, the old-style welfare state had almost had its days across the western democracies, and, starting with Thatcher and Reagan, gave way to a new, and more rampant round of laissez-faire capitalism which swept through the west, and eventually the European communist bloc , like some new liberation wave.

New Zealand was not immune from that process – which led to a form of harsh extremism most people, the ACT Party and Sir Roger Douglas excepted, have long since abandoned.

Now, as it excesses lie exposed, governments are searching for a new way that does not involve either too much welfarism or New Right economics.

We are all looking for a balance between the extremes that allows the restoration of our economies, without the social dislocation of the 1980s, or the only government knows best approach of earlier years.

This tone has been evident in the New Zealand Government’s response to the Jobs Summit, and the “rolling maul” of initiatives arising from that, through to the recent Budget.

It goes well beyond the “Third Way” politics Tony Blair and Bill Clinton espoused of a middle path between old style socialism and capitalism.

It is not about picking one’s way between the shibboleths of the left and the right, but about doing things that work.

Today’s “right” answers come from across the political spectrum, with practicality and feasibility the key tests, not their ideological acceptability.

It is why, for example, the National Party continues to do so many unthinkable things, wrong footing the Labour Party constantly in the process – from bringing the Maori Party into government (in one fell swoop doing more to honour Maori political aspirations than any previous government, and thereby completely smashing Labour’s self-assumed monopoly on Maori voting loyalty since the 1930s), through to implementing a home insulation programme with the support of the Greens, more generous and comprehensive than the Greens were ever able to achieve working with Labour

The lessons from all this are important for a centre party like UnitedFuture.

Major change can be achieved, if it is properly focused on resolving a particular problem, rather than satisfying an ideological craving.

Let me take health policy as an example – and my remarks here are made primarily as the leader of UnitedFuture, but who just happens to be Associate Minister of Health.

Over the last 60 years, healthcare in western countries including New Zealand has gone in three broad phases.

The first phase emphasised promoting and extending universal healthcare and equal access for all, consistent with the mainly post war development of the welfare state.

New Zealand’s health system followed this phase through until at least the late 1970s.

But as the system grew, containment pressures did likewise, leading to the introduction of spending caps and various forms of rationing.

This was certainly a dominant strand of New Zealand’s health policy in the 1980s and 1990s, as successive governments grappled with the issue of cost containment on the one hand, while maintaining reasonable levels of access on the other.

The emphasis from the time of the infamous Gibbs Report, through to the establishment of Crown Health Enterprises was on gaining efficiencies through greater competition, but on a business, not a service basis.

Today’s emphasis around the world is on the introduction of competition and incentives to make health services more efficient and responsive to patient needs, the critical element left out of the earlier reforms.

New Zealand has not yet followed this path, with government priorities in the last decade seeing a dramatic rise in the level of public spending on health, but without any commensurate increase in the level of service provided, despite the goodwill of health professionals

We are now at a crossroads.

The limitations of the centrally provided, taxpayer funded public health system are becoming obvious for all to see, as government budgets tighten in the wake of economic contraction.

Yet the alternative of a fully privatised business approach to healthcare is understandably socially and politically unpalatable, and no-one is seriously advocating that.

Instead, what we need is a way of preserving universality, while meeting the currently unmet needs of patients.

A universal national health insurance scheme, along the lines of that currently applying in the Netherlands is therefore an option I think we should consider.

Under such a scheme health insurance scheme, taxpayers would pay their premiums directly to competing health insurance companies, who would then buy particular specialist and elective services from healthcare providers.

The premiums payable by individual contributors would approximate to the current cost of the public hospital system, and could be offset against personal tax rates, so that no-one was paying more overall than at present.

An insurance based approach to social provision is not unknown in New Zealand – it is after all the model ACC has operated under since 1974, and there is no reason why ACC coverage could not be included within the ambit of a national health scheme, eventually providing comprehensive coverage for all health and disability issues.

Nor should we necessarily stop there –the Canadians include coverage of high cost medicines within their insurance models, and that is something we should consider here as well.

In essence, the model I am proposing would be based around competing health insurance companies using their premium power to strike better deals than the state for more innovative, timely and responsive services to patients.

The state, however, would retain important overall roles.

Because the system would be funded mainly through taxes which would now be diverted directly to health insurance companies as patient premiums, the state would remain the major funder of health services.

It would also be the ultimate guarantor of the system, as is its appropriate responsibility.

Such a scheme would clearly take time to develop, and should not be viewed as an immediate panacea.

But carrying on the way we are now will not significantly reduce waiting lists or waiting times, especially if the health expenditure increases of recent years cannot be maintained.

Wholesale privatisation of the system is clearly neither a viable option nor a likely political reality.

So we need to learn from the experience of other countries which suggests very strongly that a universal national health insurance scheme is an option we can no longer afford to ignore.

In the meantime, while we are developing the national health insurance scheme, there are interim steps we ought to be taking, particularly focused towards reducing elective surgery waiting lists.

Elective surgery waiting lists are still far too high, with many patients failing to get treatment within the Ministry of Health’s six month elective surgery goal.

Meanwhile, we continue to have surplus private sector surgical capacity which we need to be making greater use of to bring these numbers down.

Our current practice of approaching the private sector late in the financial year to carry out a number of operations in short time, when it is clear that public hospital targets are not being met is a lazy approach that does not work, nor serve patients well.

Often the private sector is unable to respond thoroughly enough because it has not had the time to plan throughput, thus leaving the cynics in the public sector to claim that when given the opportunity, the private sector cannot meet the challenge.

Instead, we should be setting a fixed target at the start of the financial year for procedures to be provided privately – say 25% – and then contracting with private providers for their delivery, and holding them accountable for achieving that level of service.

And we should also look again at incentivising people, particularly older New Zealanders, to retain their private health insurance through partial tax deductibility of private health insurance premium payments by those over age of 65.

It strikes me as absurd that mounting costs currently force many older New Zealanders to give up their health insurance at the very time they are likely to need it most.

However, the introduction of tax deductibility for private health insurance could not be on an unconditional basis.

I was interested to hear the Health Funds Association reporting recently that there was increased interest in taking up health insurance, and then in almost the next breath advising that significant rises in premium costs were likely.

If a tax incentive was to be introduced, I would be insisting strongly that part of the trade-off would have to be stability in premium charges.

A tax incentive should not be an opportunity to gouge more out of policy holders, let alone at the taxpayers’ expense.

In time, the national health insurance scheme would deal to this through the competition it would engender amongst health insurance companies, but in the interim, governments would need to be vigilant to prevent price gouging.

As a small party, with a demonstrated and unique record of being able to work constructively in government with both National- and Labour-led administrations, UnitedFuture is ideally placed to make the running on an issue like this, and to be able to bring a fully-fledged proposition to the table in future government formation negotiations.

While I have focused my remarks this evening on health policy, our detailed policy work continues in other areas that will also have an impact on our nation’s future – such as the conversion of the disparate communities around Wellington into one cohesive supercity, ideally in time for next year’s elections; continuing to develop a culture of giving, a stronger commitment to philanthropy and a stronger role for the charitable and voluntary sector; and, resolving our nation’s constitutional future, to name a few.

But each of them is an address in itself, so will have to await another occasion.

ENDS

© Scoop Media