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Motion: General Practitioner Payroll Tax

20 March 2024

The Hon. R.A. SIMMS (16:40): I move:

That this council—

1. Acknowledges that:

(a) the Royal Australian College of General Practitioners South Australia (RACGP SA) has launched a campaign for the state government to stop applying payroll tax to general practitioners; and

(b) South Australia is in the middle of a cost-of-living crisis and many people are already struggling to cover the costs of essentials like medical appointments.

2. Notes that:

(a) the patient engagement platform HotDoc has released figures that show that 95 per cent of clinics are planning to increase patient fees by an average of $12 per appointment in response to the payroll tax and only 28 per cent of patients would continue to see their regular GP (albeit less regularly), if fees increased; and

(b) the Queensland government has provided a payroll tax ruling clarifying that patients' fees paid directly to a GP for their services would not be subject to payroll tax.

3. Calls on the Malinauskas government to align with the Queensland government's approach to rule out payroll tax on patients' fees paid directly to GPs for their services.

This is a really important issue for this parliament to deal with. I note that the Hon. Connie Bonaros advanced a motion on a similar topic and I certainly share the concerns that she has expressed, but this motion from the Greens goes a little bit further than that because we are not just calling for an amnesty, we are calling for the Labor government to go a step further and that is actually rule out applying this payroll tax to GP services.

Queensland has done that. They have actually provided a payroll tax ruling that clarifies that patients' fees that are paid directly to a GP for their services would not be subject to a payroll tax. Well, the patients and medical practitioners of our state do not simply need an amnesty—in effect, a stay of execution—what they need is certainty going forward and for this money grab to be ruled out.

I understand that the state Labor government are in a difficult financial position. I understand that and that is through no fault of the government. We know of course the significant costs that have been associated with managing COVID, not just here in our own state but right across the country. But budgets are about choices and this government does not have to go down the path of slugging medical practitioners, and slugging, by extension, patients with increased fees. There are lots of other alternatives.

The Greens have referenced previously work of the Australia Institute, which finds that there was about $150 million that is going to fossil fuel companies in subsidies, direct money from the state government. That money could be put into our health system to deal with the crisis that we are facing. That would be an appropriate course of action, rather than a money grab that is going to cause vulnerable South Australians to be paying more to go to see a doctor. That is not something we want to see.

The Greens certainly support the campaign of the Royal Australian College of General Practitioners for the government to stop applying payroll tax to the work of general practitioners, indeed all healthcare professionals. We are concerned that going to the dentist could also become more expensive in South Australia should this medical tax get the green light from the Malinauskas government.

I want to reference some of the work of the Royal Australian College of General Practitioners (RACGP). They claim that the payroll tax for GPs would result in higher fees for patients, reductions in bulk billing or more GPs leaving the workforce. That, of course, would not be a good outcome for patients or the medical profession in general. We look at that with the backdrop of the ramping crisis that is getting worse and worse in this state.

Some might say, 'Do not trust politicians when they talk about dealing with these matters.' I will not repeat the phrase, but some say, 'That is all BS'. The reality is that people do rely on parliaments to deal with these sorts of matters. People do rely on governments to solve these sorts of matters and they do not expect budget black holes to be plugged by the sick in our community.

Out-of-pocket costs for medical services are rising and South Australians are unable to afford basic health care and the Greens believe, of course, that everybody is entitled to that. Last year, a Productivity Commission report showed that there was a 50 per cent increase in Australians who delayed or avoided seeing their doctor because they could not afford it. That was up by 2.4 per cent of people to 3.5 per cent. At the same time, GPs are increasingly being forced to stop bulk billing to ensure they can afford to stay afloat.

That same report also revealed there are approximately three million avoidable presentations to public hospital emergency departments that could have been handled by a GP. The reality is that if we do not fund GPs appropriately, if we do not invest in preventative care, you are going to see more people presenting in emergency and we know that our hospital system is already struggling to cope.

As we face both a cost-of-living crisis and an emergency health system at full capacity, we need to be looking at what we can do to relieve the pressure, not just compound it. In June last year, the Treasurer issued an amnesty on payroll tax to tenant GPs to 30 June of this year. This came after the Supreme Court of New South Wales Court of Appeal found that tenant GPs who pay a percentage of their earnings to a clinic rather than being paid a wage count as employees for payroll tax purposes.

The decision by the New South Wales court caught practices by surprise and according to the RACGP gave them no choice but to raise patient fees. The state government amnesty was welcomed by the RACGP to give them time to work through the implications for tenant GPs.

It is my understanding that it is not just general practitioners who fall into this category. Yesterday, a dentist contacted my office and reported that dental and psychology practices are also potentially impacted by this ruling, so the Greens call on the government to rule out applying this new tax not just to GPs but also to medical practitioners. It is important that we consider the impact that this could have on our health system in the middle of this health crisis.

Data from HotDoc reveals that 95 per cent of clinics are planning to increase patient fees by 12 per cent in response to this payroll tax. That is a terrible outcome for patients who are already feeling the pinch. Research from The Pharmacy Guild of Australia has shown that 48 per cent of patients would move to a different GP if they stopped bulk billing. Any sensible person would look at this and realise that this will end up with bulk billing facilities being overrun and being more burdened than they are at present. It will also result in patients either delaying their health care or forking out money they cannot afford to pay for the services they need.

On 21 February this year, the Queensland government issued its own ruling that patient fees paid directly to a GP for their services will not be subject to a payroll tax. The Queensland ruling applies to medical centres where medical practitioners are conducting business or providing medical services and I note that this would capture dentistry, psychology and other medical services in addition to GPs.

This motion aims to put into action the calls from the RACGP for the Malinauskas government to match Queensland to exempt medical practitioners from payroll tax both to support healthcare professionals and to also ensure patients are not being slogged for extra fees in the middle of this cost-of-living crisis.

This is a government that was elected on a platform of fixing our health system. Well, you cannot fix our health system if you price South Australians out of getting in to see a GP. You cannot fix our health system and you cannot get ramping under control if you make it more difficult to get in to see a doctor, dentist or psychologist.

All of these things are fundamental to our health system, and we cannot see South Australians being priced out of getting the care that they need. So I really urge the Malinauskas government not just to extend the amnesty but to actually rule it out, knock the nail on the head and bring this matter to a close so that there is certainty for our medical professionals and certainty for vulnerable people in our community: the sick who need the support of those professionals.