The Medicare Safety Net Broken Promise – 2004 Election Promise

During the 2004 Federal Election, Tony Abbott, the then Minister for Health and Ageing, made a promise that the Medicare Safety net would not be raised.

This is part of the interview that went to air on the ABC’s 4 Corners, on September, 6, 2004.

TICKY FULLERTON: Will this Government commit to keeping the Medicare-plus-safety-net as it is now in place after the election?


TICKY FULLERTON: That's a cast-iron commitment?

TONY ABBOTT: Cast-iron commitment. Absolutely.

TICKY FULLERTON: 80 per cent of out-of-pocket expenses rebatable over $300, over $700?

TONY ABBOTT: That is an absolutely rock solid, iron-clad commitment.


However, in 2005, Tony Abbott and the Howard Government raised the Medicare Safety Net threshold from $300 to $500 for lower income families, and $700 to $1000 for everybody else.

In an interview with Laurie Oakes that took place April 17, 2005, Tony Abbott defended his broken promise by stating:

“Well, Laurie, when I made that statement, in the election campaign, I had not the slightest inkling that there would ever be any intention to change this. But obviously when circumstances change, governments do change their opinions, and that is actually the responsible course of action.”

The problem for Tony Abbott is that he made a promise that he knew he couldn’t keep.

The interview continues:

LAURIE OAKES: You say you had no inkling it was likely to change, but Treasury knew that there'd been a blow-out, didn't it?

TONY ABBOTT: Yes. We certainly were aware the costs were increasing, and there was no secrecy about this, Laurie. The, the pre-election financial outlook statement revealed that there had been a substantial increase in the cost of the safety net, and obviously since the election the Government has had the opportunity to consider this blow-out — to look not just at the current quadrennium, but to look at the long term — and has made the decision that the thresholds had to be lifted.

LAURIE OAKES: So it didn't bother to look at the long term before the election?

TONY ABBOTT: Well, we, we were looking at the long term before the election. But obviously in a budget context you can focus even more directly on the long term, and that's what we've done.

Tony Abbott also went on to say:

“And I can certainly understand the dismay of — of some electors. I can obviously understand that. But there are all sorts of values here. One value is obviously keeping commitments. But another important value is economic responsibility, and another — a third important value is solidarity with the team.”

And later in the interview:

LAURIE OAKES: The lies are still being told, aren't they? We now find out that Treasury, when it costed Labor's policies under the charter of budget honesty, said that to abolish the safety net would cost $1.3 billion. In other words, they knew that was the cost of this scheme.

That was known before the election. Yet John Howard claimed the other day that it's only recently they've become aware of the extent of the blow-out. So we're still getting lies.

TONY ABBOTT: Well, no. The Government was aware of a significant blow-out...

LAURIE OAKES: Well, that's...

TONY ABBOTT: ...before...

LAURIE OAKES: ...that's a trebling.

TONY ABBOTT: ...before the election.

LAURIE OAKES: It had trebled before the election, and you claim you still didn't think there was any need to do anything about it.

TONY ABBOTT: Well, Laurie, again let me say that I can understand why people are dismayed by this decision. But in the end governments have to balance a whole lot of objectives. And sometimes you have to choose between a range of difficult, even unpalatable, alternatives.

And we could stick with the pre-election position. And further blow out the cost of the safety net. Or we could make a change. And we thought on balance it was best to take the economically responsible position now.

LAURIE OAKES: On balance wouldn't it have been better to be honest before the election? Acknowledge it had blown out to $1.3 billion and make the changes then?

TONY ABBOTT: Well, Laurie, we did acknowledge in the pre-election financial outlook statement that there had been a very significant blow-out in the cost of the safety net. I think the, the first year cost of the safety net had blown out by some fifty per cent in the pre-election financial outlook statement, and obviously there had been a commensurate blow-out in the forward estimates.

LAURIE OAKES: Now, Peter Costello also knew the figures were phony, didn't he? In fact he said the parameters of the Medicare safety net will not change. In other words, he committed himself as much as you did.

And yet he's led the charge now to break the promise. What do you think of that? This is the bloke who wants to be prime minister.

TONY ABBOTT: Laurie, again, I can understand your dwelling on this. But, but sometimes governments have to choose between a range of unpalatable alternatives. Now...

LAURIE OAKES: One of the unpalatable alternatives is telling the truth, presumably.

TONY ABBOTT: We set up this safety net back in March of last year. Thinking that it was going to cost $440 million.

LAURIE OAKES: You knew by the election it was $1.3 billion.

TONY ABBOTT: We, we discovered in September-October that it was going to cost a lot more. We made a decision in a budget context that the best thing we could do for the long-term health of the economy, and indeed for the long-term health of the Medicare system, to change the thresholds.

LAURIE OAKES: And con the people through the election.

TONY ABBOTT: Look, we, what we, what we said to people back then was what we honestly believed to be the case. And...

LAURIE OAKES: But how could Peter Costello believe it to be the case when his Department knew it was going to cost $1.3 billion? Knew there was a trebling?

TONY ABBOTT: But, but Laurie, the point I make is that there was no deception about the cost blow-out. The cost blow-out was there for all to see in the pre-election financial outlook.

LAURIE OAKES: The deception's about what it meant.

TONY ABBOTT: Well, Laurie, the thing is this: obviously when you have time to reflect and consider these things, as governments obviously do in a budget context, you've got to make a decision. And the decision was to be economically responsible.


The fact is that Tony Abbott (along with John Howard and Peter Costello) knew that it was a promise that they could not and would not keep, but Tony Abbott did nothing to forewarn voters that he had lied to them before and/or after the election.

But let’s reflect on some things that Tony Abbott stated in his interview with Laurie Oakes:

1. Tony Abbott knew the costs of the Medicare Safety net were blowing out, but he still gave “an absolutely rock solid, iron-clad commitment” to keep it as it existed before the election.

2. Tony Abbott believes that Governments should be able to change their minds and break their promises after an election because “governments have to balance a whole lot of objectives” and “sometimes you have to choose between a range of difficult, even unpalatable, alternatives.”

It's a far cry from Tony Abbott's hypocritical stance now, where Tony Abbott believes that he can say and do whatever he wants.

Additional sources: