Tuesday, December 16, 2008

Giving With One Hand…

From January first, the price that pensioners must pay for their prescriptions will increase from $5.00 to $5.30. Although thirty cents doesn’t sound like much, it represents a jump of 6%, well above the inflation rate which has been at 5%. Many pensioners find themselves dependent upon several different medications, in some cases as many as ten. Even if each needs to be renewed only once a month that is still 120 scripts per year. Thankfully, there is a threshold beyond which pensioners will get their medications for free.

But wait a minute! Adding injury to insult, that threshold is set to increase from 58 to 60 prescriptions in the course of a year. Presumably somebody somewhere thought that the pensioners wouldn’t mind if the figure was increased to make it a nice round number. Whatever the reason, it simply adds just a little more to the cost burden to be born by the pensioner. The individual amounts may be small but they add up to a death by a thousand cuts.

It is particularly ironic that this follows not only the debate about the inadequacy of the base rate of the aged pension, but also the dramatic round of cash bonuses delivered this month. While telling us all that the cash bonuses will be good for the economy and that pensioners deserve a bit of a boost, it turns out that pensioners might be better off saving up their bonus money to pay for the increased cost of their medications. It’s a classic example of the government giving with one hand and taking away with the other.

The Federal Government has responded to concerns by pointing to the review of pensions which will be completed in February. The health minister has stated that the review includes an investigation of the effectiveness of benefits such as the pharmaceutical subsidy. So while the price goes up in January, the inference which is encouraged is that relief will be delivered after the review is completed. Presumably, whatever reforms or adjustments are finally adopted will be delivered in July after the next budget.

Once again, the government has deflected concerns about pensioners by indicating that those concerns will be addressed in the outcome of the review. It has actively raised expectations in the community that pensioners will get a better deal. If that is to be genuine, it must include not only pharmaceutical benefits, but the entire range of benefits and concessions available to seniors, and it must leave pensioners tangibly better off than they are now. Anything less would be seen as simply more of the same old double dealing.

The government has been very careful not to make specific promises, but that won’t prevent a massive backlash if the people are left feeling that they have been dudded again.

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