Page 5097 - Week 14 - Tuesday, 17 November 2009

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have considered, particularly Dr Dwyer’s contributions to the debate. Not making an investment on the north side has consequences for the delivery of healthcare services and for the productive capacity of our economy.

The financial analysis that was undertaken by Treasury—and I have to say it still remains unchallenged—on the three options for Calvary Public Hospital include maintaining the current arrangements, constructing a new hospital on the north side of Canberra or the government purchasing the hospital from the Little Company of Mary. The financial analysis indicates that the acquisition of Calvary Public Hospital for the estimated book value of $77 million is a more prudent financial proposition than maintaining the current arrangements or constructing a new hospital on the north side of Canberra.

There are potential budgetary and economic impacts of maintaining the status quo. The most effective option for the government—and this is outlined in the financial analysis—is to purchase the hospital and to make the necessary investments. It is cost effective for our budget and it is beneficial for the economy in avoiding potential economic costs.

There are further benefits from the acquisition of Calvary Public Hospital. Hospitals work best as networks, and having two separate public hospitals with separate management in a town with two hospitals is less than optimal. The acquisition will provide an opportunity for the government to create a seamless, integrated and coordinated public health system. This will allow for efficiencies to be maximised through a single government arrangement, consistent policy planning and management, which will lead to improved health outcomes for the community.

The proposal is good for the territory’s health system. It allows us to make the necessary investments prudently. It is good for the budget and it avoids the deterioration of our financial position.

MR SPEAKER: Ms Porter, a supplementary question?

MS PORTER: Thank you, Mr Speaker. Minister, you mentioned that gifting $200 million has economic consequences. Can you further elaborate on what those consequences are?

MS GALLAGHER: I can. The potential budget impact of maintaining the status quo has been dismissed by some, including the opposition, as a simple accounting issue. To do so, however, trivialises a significant fiscal policy decision. I am not sure whether Mr Smyth agrees with his colleagues on the analysis that the opposition has put forward, because it is an unusual position, you would have to argue. But there we go.

It is an important question because it relates to policy considerations that a prudent government would have, considerations that do not appear to matter to the opposition. The position of a jurisdiction’s balance sheet and operating budget is an important determinant of our financial position and the capacity of a state or territory, and havs flow-on economic impacts. A grant of this magnitude—can you think of a grant of

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