The Australian Labor Party has always known the importance of a sustainable private health insurance sector, and the indexation of the private health insurance rebate is an important part of keeping this sector sustainable. It is often said that one's health is one's wealth. If this is true, it is fair to say that a nation's wealth is the health of its people. No party understands this better than Labor. Time and time again Labor has come to the defence of our nation's health system. Time and time again we have rebuilt it after the conservatives have recklessly slashed budgets and relentlessly sought to tear down Medicare. Time and time again, it has been Labor that has had the courage to tackle the threats to our nation's health by listening to health professionals and formulating sound health policy.
But Labor also understands that this comes at a cost. Health expenses count for 19 per cent of Australian government expenditure. We must always be looking at ways to make savings and strive for efficiency, but not at the cost of the health of our citizens. The indexation of the private health insurance rebate is expected to raise about $700 million in savings over the forward estimates. This is money that can be reinvested into the health system, a system that the Prime Minister himself commended as being 'in pretty good shape' after the stellar work done by the previous Labor government, work led by former health ministers Nicola Roxon and our Deputy Leader, Tanya Plibersek. This bill will not affect the amount of money saved on the private health insurance rebate, and it maintains the integrity of the former Labor government's intent. This bill aims to change the way private health insurers make the calculation to apply and administer it.
I was a school principal in my previous life. I therefore understand paperwork and the burden of administration. I also understand the time and effort required when implementing new systems. As a principal, I was privy to the amount of work involved when new processes were introduced, and I know firsthand how much of my staff's time was taken up with administration. So I am sympathetic to the health insurers and their wish for the quick and efficient implementation of this legislation, and I support this bill and its aim. But I would like to highlight that the rights of policy holders should not be diluted or lessened by health insurers' understandable aim to reduce their administrative burden as a result of this amendment.
When the Labor government introduced this change in May last year, there was a debate centred around whether the indexation of the rebate should be calculated at the product level as implemented, at industry level, or at the individual insurer level. The Department of Health and Ageing was concerned that proposing the indexation at industry level, as this bill does, would put smaller insurers at a competitive disadvantage. We on this side of the House, and I assume many of those opposite, value the importance of not only a competitive private health insurance market but one that offers a diversity of choice. This is why I share the concern held by the Department of Health and Ageing and those raised by the member for Ballarat earlier that this amendment may put smaller insurers at a competitive disadvantage. At the core of Labor's proposed implementation model was an aim to create greater competition and transparency for consumers. It is now up to the government to show how this bill will do just that. It is now up to the government to reassure the smaller insurers that they will not be at a competitive disadvantage. It is now up to the government to reassure that private health insurance consumers will not suffer through lack of choice, and that they will not suffer the adverse effects of being at the mercy of an uncompetitive market.
As I said earlier, Labor is and has been committed to there being a sustainable private health insurance sector, so it stands to reason that we support measures that enhance competition. But we go further—we stand up for consumers too. This is what separates us from those opposite. While the coalition consistently sides with big business, Labor advocates for consumers and stands up to a government that cares little for the rights and needs of the average Australian. Labor is the only party that can see the value of, and advocate for, a competitive marketplace that enhances the health and wellbeing of its population and not just the health and wellbeing of big business.
Like many in this place, I am a student of history and I think that examining the past reveals much. So let us take a look at this government's record when it comes to private health insurance so far. This is the government that has approved the biggest increase to private health insurance premiums in almost a decade. This is the government that tried to sneak through these changes, making it more expensive for every Australian with a private health insurance policy, just two days before Christmas. This is the government that says it wants the private health insurance industry to have a greater involvement in the delivery of health care, but, really, they are seeking to destroy Australia's system of universal health care by creating a two-tier health system. This is the government that, the public are hearing, intends to sell Medibank Private while failing to demonstrate in any way how it will improve competition or help Australian consumers—not a single argument as to why we should sell an asset like Medibank Private.
Despite the constant criticism from the coalition when in opposition, the number of people with private health insurance was at its highest rate in Australia's history under a Labor government. Unlike so many of the Abbott government's assertions, this can be backed up by statistics and data. The most recent data from the Private Health Insurance Administration Council shows that over 105,000 more people took out private health insurance between June and September last year. Compared to the same time in 2012, more than 255,000 Australians had private health insurance cover. In percentage terms, this represents the highest rate of insurance cover ever, with 47 per cent of Australians having hospital cover and 55 per cent having general cover.
It was under the former Labor government that a means-tested rebate for private health insurance was introduced. This meant more money available to invest in our health system, more money to fund much needed and lifesaving medicines, and more money to build important health infrastructure like the network of regional integrated cancer centres. Labor did this because the health of every single Australian has always been our priority. We see this in our proud history in wider health reform. We are, after all, the party of Medicare, the party of the Pharmaceutical Benefits Scheme, and the party of the National Disability Insurance Scheme. Under a Labor government, Australians had greater access to more doctors and more nurses, as well as a record number of GPs and health professionals being trained. It was a Labor government that ensured that seeing a dentist became as easy as seeing a doctor for 3.4 million Australian kids, that pensioners and low-income earners gained access to improved dental services and that our young people gained access to a dedicated and committed mental health service in headspace. It is always Labor that cares about the health and wellbeing of everyone in our community. It was under Labor that bulk-billing became easier and more accessible.
I see Labor's commitment to health demonstrated in my electorate every day. I see it in the tailored and integrated health care provided by our South Western Melbourne Medicare Local. I see it at the Werribee Mercy Hospital, which received $28 million in funding to build a 30-bed sub-acute service and a community rehabilitation centre. I see our commitment to health care when I visit the soon-to-be-opened Wyndham Vale GP superclinic. And I know I will see it when our local headspace opens, providing much needed mental health services to our young people. I see Labor's commitment to health every day, because we believe that every Australian, young or old, wealthy or not, deserves great health care.
But imagine if this free and fair system did not exist: if we had a government that did not recognise how important funding health infrastructure and services was; if, instead of having equitable access, seeing a GP depended on how much money you had in your pocket, not how much your need was; if concessions to business and industry were more important than the health and wellbeing of the Australian population. We do not have to imagine too hard, unfortunately, because under this government it could become reality.
In contrast to Labor, Mr Abbott was the health minister that cut $1 billion from our hospitals and health services. It is his party that has failed to commit to Medicare Locals and that failed to see just how important services like Medicare Locals are to communities like mine. This is also the party that opposed the introduction of GP superclinics, and the party that refuses to acknowledge existing care shortages and see the benefit of holistic health services like the Wyndham Vale GP superclinic. It is also this party that seeks to impose a tax upon the sick—in other words, a tax upon the most vulnerable in our community. Because, despite their promises to the contrary, this is not a party that cares about the health of every Australian. Instead, it is Labor that stands for universal access to health care so the most vulnerable Australians can access the highest quality care available. And it is Labor that supports a sustainable private health insurance sector.