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Catholic Health urges tax breaks to pay for aged care

In the midst of debate over how to fund the country's increasing aged care responsibilities, Catholic Health Australia has urged a "social insurance scheme", where workers would receive tax breaks for saving to cover their future health care.

Under the scheme, three per cent of taxpayers' taxable income would become tax-free if placed into an account earmarked for health.

"It's a savings vehicle, not a tax," said chief executive officer Francis Sullivan. "You get tax relief because you will save."

Mr Costello will release a Treasury report with the May 14 Budget, understood to show the twin costs of ageing and new medical technology will be up to $50 billion more than it is now.

Mr Sullivan said a report explaining the future of post-retirement health costs is not enough.

"If the government simply comes out with a report without a strategy for paying for the future, they are being irresponsible," he said.

Mr Costello, who has heralded the coming Inter-generational Report on health costs as a visionary document, declined to elaborate on health levies.

Minister for the Ageing Kevin Andrews, who had told the Herald Sun a 3% worker contribution plan was "an option", backpedalled yesterday after Mr Costello's comments.

"I have no idea of the details of it and it's not something which I'm proposing within government," Mr Andrews said.

Sources said the Government was anxious to avoid superannuation-style health accounts being seen as taxes.

Catholic Health Australia
Australian Department of Health and Ageing


23 Apr 2002