A prominent health analyst says it would make more sense to put the money raised from Medicare copayments directly into medical research now, rather than putting it into an endowment fund.
Appearing on the ABC’s Q&A program after the budget, Treasurer Joe Hockey argued the need for increased medical research funding.
“If we are truly going to find the cures for cancer, mental health, illnesses, we’ve got to start investing now,” he said.
The Government’s solution is the medical research future fund, bankrolled by billions in health care savings like the Medicare copayment, hospital budget savings and fee increases.
The fund will grow to $20 billion, generating $1 billion in annual income by 2022, with that money distributed to support medical research.
This year the Government will tip $1 billion in savings into the fund for a payout of just $20 million.
The Grattan Institute think tank says medical research would benefit more if the Government ditched the fund and simply allocated the billion dollars in savings now, instead of waiting for eight years until the fund gets big enough.
“There’s no particular reason why you need an endowment for medical research – it delays the increase in spending that would otherwise have been brought forward,” said the institute’s health program director Stephen Duckett.
“So I think it’s a bad move from a medical research perspective.”
At the same time as the Government is looking to put money into future research, it has stripped funding from some agencies that help commercialise products – a key weakness in Australia’s biotechnology and other research-related industries.
“Money that we know we can access has gone and we’ve been promised money that we might be able to access in the future, so we’ve lost certainty and we’re relying on on a hope,” said Dr Graham Kelly, the chief executive of Novogen, a company that is developing cancer therapies.
Others who’ve been hit by budget cuts, such as CSIRO chairman Simon McKean, are desperate for increased funding.
He is calling on the Government to sever the link between the medical fund and unpopular Medicare copayment.
“It would be a tragedy if it fell over simply because the funding aspect of it wasn’t agreed to by a sufficient number in the Senate,” he said.
This story will air on ABC News at 7:00pm, with an extended version on The Business at 8:30pm (AEST) on News 24 and 11:00pm on ABC1.