Health Services Amendment (Local Health Districts and Boards) Bill 2011



About this Item
SpeakersSkinner Mrs Jillian; Speaker; McDonald Dr Andrew; Humphries Mr Kevin; Tebbutt Ms Carmel; Constance Mr Andrew; Hay Ms Noreen; Deputy-Speaker (Mr Thomas George)
BusinessBill, Bill Introduced, Agreement in Principle, Motion



HEALTH SERVICES AMENDMENT (LOCAL HEALTH DISTRICTS AND BOARDS) BILL 2011
Page: 209

Bill introduced on motion by Mrs Jillian Skinner.

Agreement in Principle

Mrs JILLIAN SKINNER (North Shore—Minister for Health, and Minister for Medical Research) [10.03 a.m.]: I move:

      That this bill be now agreed to in principle.

I am pleased to bring before the House the Health Services Amendment (Local Health Districts and Boards) Bill 2011 as the first piece of health-related legislation by the O'Farrell Government. The bill paves the way for giving effect to one of our key election promises, that is, devolution of responsibility and accountability in the health system and a return of decision-making closer to our patients. A key problem of the former New South Wales Labor Government's management of the health system was its policy of overcentralisation, added layers of bureaucracy and red tape and remote decision-making. When Peter Garling, SC released his report on the review of acute hospital care he warned that the New South Wales health system was on the brink. The Garling report focused on the disconnect between clinicians and local communities and the administrators who made decisions about hospitals and health services.

The New South Wales Liberals and Nationals believe that those closest to the patient are best equipped to make best decisions about improving health care. We need to ensure that local clinicians and the local community have a real say in decision-making at their local hospital or health service and that they have access to transparent information to make those decisions. That is why we committed to removing the huge, inefficient area health services and creating a flatter administrative structure based on districts that cover hospitals and other health services in a particular region. We said in our policy that health districts would facilitate the development of partnerships to provide seamless health care to people, whether that involved hospital treatment or community-based health care services provided by general practitioners, pharmacists or other allied health professionals. We announced that board members would be appointed on merit to include people who have medical expertise, financial and risk management skills and good standing in local communities. We committed to further develop clinical networks that link medical experts across the system. We pointed out that certain back-office corporate support functions would continue to be provided as a centralised service.

Our 2009 policy titled "Making It Work" was about devolution. I emphasise the date of that policy—March 2009. It proposed a flatter management structure with devolution of responsibility to health district boards and hospital general managers, doctors and nurses in charge of units and wards having a say in running their services. The requirement to wait for approvals from distant administrators should be reduced. As I said, our policy was released in March 2009. In response, the former New South Wales Labor Government took every opportunity in Parliament, through the media and in speeches to criticise our policy. It did so relentlessly until former Prime Minister Kevin Rudd announced before the National Press Club the Council of Australian Governments [COAG] reforms, which were based on giving greater control of health care to local communities. New South Wales Labor had to eat its words, get rid of the dysfunctional area health services and create local health networks. The problem is that it did not go far enough. It did not give proper control to the networks and governing councils that were established. That is the basis for this bill, which I introduce to Parliament today as my first piece of legislation as Minister for Health. I am proud that in the first sitting week of the new Liberals-Nationals Government I am introducing legislation that we promised.

The key changes in this bill are to provide for local health districts and district health boards in lieu of the 15 geographic-based local health networks and their governing councils. I trust that the Parliament will support this legislation so that local clinicians and local communities will have a greater say in how their local health services are run and another election commitment is kept. The revised structures will allow us in an orderly process and fashion to transfer greater degrees of responsibility and accountability to locally based decision-makers where the interests and involvement of patients and community can find a more immediate expression and response. As I previously indicated, changes were made to the structure of the New South Wales public health system in 2010, including the abolition of the area health services. The focus of these changes was to bring the New South Wales governance structures in line with the April 2010 Council of Australian Governments agreement on health reform, to which I previously referred.

A revised emphasis on local responsibility and accountability in part will be built upon two changes that will be made by this bill. First, item [1] of schedule 1.1 replaces the geographic local health networks with local health districts. The districts will retain the primary purpose of public health and hospital services, which is to provide relief to sick and injured persons through the provision of care and treatment. There will be a clear identification of each local health district with a particular geographically defined region, reflecting the broad remit of local health districts for the overall health of their communities. The districts will be responsible for the delivery of safe, high-quality and appropriate clinical services to their local communities as well as facilitating access to clinical services outside their districts where necessary and appropriate. At this stage I am not planning any revision of the existing geographic boundaries. However, I have indicated to the chairs of the current local health districts—or networks, as they are presently referred to—that minor variations may be contemplated at some time in the future, although none of these would be undertaken without a detailed process of local consultation and discussion. That includes discussions with local clinicians, communities and members of Parliament.

The second change set out in item [2] of schedule 1.1 to the bill concerns the governance of the local health districts and specialty health networks. The term "governing council" directly reflected the provisions of the National Hospitals and Health Network Agreement. I intend to adhere to the localism provisions dictated by that agreement. However, the policy of this Government is to ensure that the governing bodies function as the core accountable bodies and undertake the core accountabilities of boards of statutory corporations, with significant public responsibilities and accountability. It is proposed to reflect that through greater statutory recognition by replacing governing councils with district health boards and specialty network boards. The latter are non-geographic health providers such as the forensic mental health network, which provides mental health services to people in custodial care, and the Children's' Hospital network. The St Vincent's speciality network already has its own board.

The role of the boards will be focused on leading, directing and monitoring the activities of their services in a way that is responsive to their local patients, clinicians and communities. The functions are set out in the legislation and include: ensuring effective clinical and corporate governance frameworks are established, and approving those frameworks; approving systems that support the efficient and economic operation of the district, to ensure that the network manages its budget to ensure performance targets are met and to ensure that resources are applied equitably to meet the needs of the local community; ensuring strategic plans to ensure the delivery of services is developed and approving those plans; conferring with the chief executive in connection with the operational performance targets and performance measures to be negotiated in the service agreement for the network and approving the service agreement; providing strategic oversight of financial and operational performance in accordance with the statewide performance framework; seeking the views of providers and consumers of health services and the local community on policies, plans and initiatives; providing information on the district's policies, plans and initiatives to the community; liaising with other districts and speciality networks on both local and statewide initiatives for the provision of health services; and approving the annual report.

The chief executive of each health organisation will be responsible for controlling and managing day-to-day operations and performance of his or her district or specialty network in line with the Government's policies and local needs or priorities identified by the board. The chief executive is accountable to his or her board for the way in which he or she undertakes these functions. The board has the power to recommend the appointment or the removal of the chief executive. No board can be effective unless this central responsibility lies clearly with it. Devolving this responsibility to the boards is the clearest possible indication of how serious this Government is about enhancing local responsibility and accountability.

The boards will comprise 6 to 13 members who will be appointed by the Minister for Health and who have an appropriate mix of skills and expertise to oversee and provide the guidance necessary for a complex health organisation as well as ensuring local community and clinician representation. The current selection criteria for membership will be retained. It is critical that the boards and members of the boards have the necessary skills in health management, business and financial management and expertise as well as experience in the provision of clinical and other health services, research activities and indigenous health. The devolution of new responsibilities and accountabilities to boards in some instances will require that those boards have greater expertise around the board table in matters such as financial planning and strategic asset management or legal services. I identified those skills in my policy entitled "Making it Work", which was released in March 2009, so the expertise required should come as absolutely no surprise to anyone who works in the health system.

At the same time I draw attention to the specific retained requirement that boards also have members with special knowledge of Indigenous health as this Government is determined to work to close the gap in terms of the continuing and unacceptable lower level of health outcomes for our Indigenous people. In my other capacity as Minister for Medical Research I am also determined that board membership will include people who are qualified to provide guidance and leadership in this field, which is a priority area for the O'Farrell Government. As the Minister I also will be responsible for the appointment of board chairs, although I have already indicated that when a particular board wishes to appoint a deputy chair, I will be pleased to leave that decision and choice of such a person up to the board. Most importantly, knowledge and understanding of the community served by a local health district is essential to ensure that local health districts are responsive to their local patient and communities' needs. It is also my intention to ensure that different communities and health service providers at hospitals within a district are fairly represented on boards.

The bill also makes amendments in relation to certain statutory health corporations. Items [3] and [4] of schedule 1.1 amend the Health Services Act to provide for specialty health networks and specialty network boards in lieu of the current non-geographic local health networks and their governing councils. Currently there are two non-geographic based local health networks that will be affected by this legislation—the Sydney Children's Hospitals network and the forensic mental health network. They now will be established as specialty health networks to better recognise the specialist nature of the services they provide. Item [5] of schedule 1.1 completes the changes by applying the local health district board governance structure to these bodies. For the sake of completeness I should note that at this stage changes are not being made in arrangements that cover the operations of Justice Health, nor to the four so-called pillars established as a result of the Garling review of 2008—the Agency for Clinical Innovation, the Bureau of Health Information, the Clinical Education and Training Institute or the Clinical Excellence Commission.

Schedule 2 of the current Act identifies three health reform transitional organisations or cluster services. I have announced already that the Government intends to abolish the clusters as they are an unnecessary level of bureaucracy within the health system and are incompatible with our commitment to devolution. I am currently in discussion with the Director-General of the Department of Health to determine where the existing responsibilities of these clusters should be located and which of those responsibilities is appropriate for delegation to the new districts. I anticipate that the new arrangements will be in place, subject to parliamentary approval of this legislation, by 1 July 2011. I emphasise that in the meantime, until the formal changes are made, all existing arrangements, appointments and responsibilities remain in place exactly as they are at present.

By-laws and instruments of delegation will continue to progress the devolution of accountability for decision-making and performance to the districts and specialty networks. It is my hope that over time as the expertise and experience of boards increases so too will the pace of devolution. The primary instrument of accountability will be the annual service and performance agreement between the State and the district or specialty network. The boards and their chief executives will be accountable for meeting a clear set of financial and service key performance indicators set out in the agreements.

I emphasise that these amendments mark merely the beginning of a process for change. We are nowhere near the end. We are sending a clear message to the community about the Government's commitment to increasing local decision-making and local accountability and to honouring its election commitments in health. More work will need to be done. I have met a number of the clinicians in the workforce in rural New South Wales—in Dubbo, yesterday in Tamworth, and in western Sydney during my visits to Penrith and the Nepean Hospital and to Westmead—and this has been warmly welcomed by all. Clinicians very much want to have the opportunity to influence decision-making at their local level.

There will be incremental devolution of decision-making to the front line as the boards and their executive teams settle into their roles and develop their own expertise and capabilities. At the same time we need to ensure that all local health districts and specialty networks receive equitable access to expert support. In an address I gave to the chairs of existing governing councils in the week I became Minister I assured them of this support. I also advised them that they could call upon the expertise of the department in managing this challenging transitional phase. As I said in my policy "Making it Work", there are functions that will need to continue to operate at a statewide level or to be coordinated between districts. We need to maintain a robust performance management framework for our system.

We also need to support and retain clinical networks that link medical experts across the health system. These and other similar functions will need to operate through statewide structures such as the various statutory health corporations and the Health Administration Corporation shared services program. I have therefore asked the Director General of the Department of Health to undertake a more general governance review of the health system. The outcome of this review will involve further administrative changes to redefine how different functions will be undertaken, all with the aim of supporting a system that has the patient at the front and centre of everything we do.

Furthermore, I am well aware that the transition to the 15 existing networks, soon to be districts, has not yet itself been completed. While I am determined that we move swiftly on the necessary changes, I recognise that there is a need for stability in the delivery of health services as we move forward. The work of the transition will continue and, as I have already indicated, the health reform transition organisations that were established to support that transition will continue this role but only until the necessary administrative changes have been achieved.

Policy and administrative changes such as those proposed in this bill do not occur in a vacuum or without an underlying rationale. In this first piece of health-related legislation to come before this Parliament it is appropriate that I speak in more detail about the policy environment in which the New South Wales health system will be nurtured and developed by the O'Farrell Government. In the first instance this Government requires that everything done and everyone employed in the New South Wales health system has as a principal focus the welfare of patients. Every outcome must have a patient focus and every proposal must include a patient-centred justification. Patient access to timely, quality health care must be improved, and this Government is determined to enhance that at all levels.

Secondly, both best medical practice and simple common sense indicated that our primary activity focus should be upon preventive health measures. Indeed, keeping people out of hospital in a way consistent with their best medical interests is vital. I acknowledge the very important work that my colleague the Minister for Healthy Lifestyles and the Minister for Mental Health will be doing in this regard. Thirdly, in order to allow patients to make better informed decisions about their own health care and that of their families there needs to be greater transparency and access to information across the system. The Bureau of Health Information will have a vital role to play in relation to that and I have already met with the bureau to encourage it to undertake more research and publication of health data and information upon which both governments and individuals can rely to make better decisions and choices. No-one should fear the truth; no-one should fear transparency. The era in which both were actively discouraged and notoriously absent from the New South Wales health system is over.

Fourthly, the entire tenor of this bill is to encourage and promote devolution in decision-making and accountability. New South Wales has some of the best and most qualified health professionals available. But under Labor policy the system has become too centralised and too unresponsive, especially to the needs of patients and the advice of clinicians. Devolution and discussion will be the hallmarks of the new O'Farrell Government. Fifthly, I say quite clearly that no health system can be truly effective if there is not a real culture of service about it. I have already had discussions with the Director General of the Department of Health about the need to eliminate bullying and harassment from any part of the health system and to move towards the development of a new code of conduct based on what I have called the core values of collaboration, openness, respect and empowerment. Culture change is an absolutely necessary precursor to enhanced outcomes for both the patients and all the people working in the health system at whatever level they may be.

Once it is clear that those of us placed at the leadership level of the health system—the Minister, the director general, senior executive staff, all chairs and chief executive officers—are utterly committed to these principles then I have no doubt that we will find willing and indeed enthusiastic supporters of our reform agenda through every nook and cranny of the New South Wales health system. There are wonderful employees in the health system and they have been busting to have the shackles of the policy of the former Labor Government in central control removed, which took no action in relation to bullying and harassment. A commitment to major reform in the health system of this State was at the very front and centre of the last election campaign which resulted in the New South Wales Liberals and Nationals Government, led by Premier O'Farrell, being entrusted with one of the greatest and most comprehensive electoral mandates in the history of not only the State but also of Australia. The damning verdict pronounced upon 16 years of Labor failure and incompetence speaks for itself. Those days are well and truly over.

The SPEAKER: Order! The member for Canterbury will come to order. The member for Wollongong will come to order.

Mrs JILLIAN SKINNER: This bill represents a first step in honouring our commitment to the people of this State to work to make it great once again. I commend the bill to the House.

Dr ANDREW McDONALD (Macquarie Fields) [10.28 a.m.]: The Opposition will not oppose the Health Services Amendment (Local Health Districts and Boards) Bill 2011 but I have some significant concerns about it. As the Minister said, no-one need fear the truth. Yet, the most complex thing the human race has ever undertaken is modern health care. This proposed legislation represents significant change to the way health care is conducted in this State, yet it is being done in one morning. I received no notification prior to 10 o'clock this morning that this bill would be debated today in all stages. The usual protocol for the passage of legislation is that the Minister in charge of a bill will give an agreement in principle speech and then debate on the bill is adjourned for five days in order that stakeholders may be consulted. This major change will not happen on this occasion. If they have nothing to fear from the truth they would have no concerns about consulting stakeholders.

As Garling said, we have one of the world's better health services. In fact, the current health services which the Minister spent considerable time talking down are rated by international agencies as being among the best in the world. Today 90 per cent of patients in the current health system rate their care as good, very good or excellent. We run one of the world's better health systems, but that does not mean there is not substantial room for improvement in some areas, especially in Aboriginal health, to which the Minister alluded. Why is this significant change being rushed through without obtaining a considered response by the many health stakeholders?

This proposal really is a battle between centralisation and decentralisation of health, a battle that exists in all health services across the world. This proposal is a return to the past. In 1990 at a meeting with then director general Dr Bernie Amos I, as a junior consultant in south-west Sydney, was informed in no uncertain terms that the health pie was only so big and the only way I would get more of that health pie was effectively to remove it from another area health service. This was not his job; it was my job. The rest, as they say, is history. The rapid population growth was not catered for under the then Liberal Government. Eventually the demand on health care exceeded the supply of clinicians able to deliver it.

This proposed return to the past should cause concerns to all members who live in growth or rural areas because, despite the best efforts over many years of many people from both sides of government, there remain significant inequities in health care in the peripheral areas of Sydney and rural areas. This bill locks in every health service to a catch-and-kill-your-own mentality. Under this system there will be no mechanism for redistribution of funds. Despite what the Government says, casemix funding has its own flaws, which is why its introduction raises significant concerns worldwide. Removing clusters is regarded by many stakeholders as a retrograde step. It would have been good if supporters of clusters had a chance to advocate for their retention in some way.

Modern health care trends are towards networking care. Clinical networks already cross area health service boundaries. This proposal will mean more boundaries will have to be crossed. Health costs increase by 9 per cent per year; funding cannot possibly keep in line. What will happen through this proposal is that every area health service will become a silo with no mechanism for redistribution to growth or rural areas. This system is a return to the past; it is a system that did not work. I have significant reservations that again it will not work. All stakeholders should have had a chance to discuss the proposal after the Minister's initial speech.

The science on how to run health systems is clear. It matters less how they are run than whether they are funded or staffed properly. That is what it all comes down to. This proposal contains no mechanism for identifying how to properly fund and staff each area health service. What will happen when an area health service proves to be unable to meet its population need? I look forward to hearing the Minister's reply on how she will address the problem of an area health service being clearly unable to meet the needs of the population it serves. An enormous amount of time and discussion has been spent on the makeup of each local area health network. What will happen to them? The Minister needs to tell every member of those local health networks whether they still have a job. I understand and accept the need to possibly increase expertise in some areas, especially as part of financial management. The enormous amount of consultation that was undertaken regarding personnel for each local health network is being undone by this proposal. I want the Minister to indicate clearly that there will be no political appointees of any sort to any of these boards.

We need to hear also from the Minister whether this legislation will put at risk the Commonwealth funding of $75 million in 2011and the 488 extra beds. This bill also will re-create a new bureaucracy. It is well known that the amalgamation of the 17 area health services saved $70 million and 1,100 positions. The Minister needs to identify in dollars and cents how much this re-creation of past infrastructure will cost and whether that money will come out of the clinical budget or is part of an enhancement. As I said before, the future of health care is networking. The Minister needs to identify how clinical networks which cross the boundaries of area health services will be maintained and enhanced. For example, trauma, cardiology, complex ophthalmic surgery or neurosurgery networks need to be encouraged and enhanced as they now will cross numerous health service boundaries. How will the Minister support these clinical networks as distinct from area health services?

I am pleased the Minister said that the four pillars will remain: they are vital to the future of health care. As Professor Michael Marmot, one of the world's great demographers, said, "If you are serious about health care you correctly measure what you are doing." The Bureau of Health Information and the Clinical Excellence Commission are vital for this proposal. For that reason I am encouraged by the Minister's firm statements that these services will continue to be encouraged and enhanced. However, as with everything, the proof will be when it happens. Words are one thing; we will need to see proof. As I said earlier, health costs increase by 9 per cent per year and true funding cannot possibly keep pace. The future of health care with changing technology and demand is networking. This bill flies in the face of that and does nothing to address the projection that by 2040 health will take up 100 per cent of the State budget. We need to know the Minister's plans to rein in health costs under area health services. What will happen to area health services that have difficulty meeting their budget or that do not spend their budget? Will any of those budget surpluses be returned to consolidated revenue or will area health services be able to retain the money for future needs? As I said, growth areas and rural areas are my main concern. I cannot see that these changes will help to provide the expanded services that these areas need.

The proof of the effectiveness of these changes will be what occurs. This system has previously been found wanting in growth areas. We need to know whether the system, which has failed in the past, will now work. The Opposition will be watching closely to ensure that the areas that most need enhanced services—that is, the rural areas and the growth areas—receive them. It worries me that the Minister has said there is more change to come. I can only hope that when these changes are implemented they are foreshadowed and that this is the last time that any Minister for Health treats health workers with contempt by saying that we do not get out of bed every morning with the aim of improving patient care.

Mrs Jillian Skinner: Who said that?

Dr ANDREW McDONALD: You did. I am one of the 90,000 health care workers to whom the Minister referred. As she said, every healthcare worker must focus on patient care. I can assure her that having spent 30 years in the system—
    Mrs Jillian Skinner: Point of order: I ask the shadow Minister to withdraw that remark about my suggesting that healthcare workers do not get out of bed every morning with the aim of helping to improve patient care. I said no such thing and he knows that. That comment is offensive and it should be withdrawn.

    Dr ANDREW McDONALD: I will check Hansard to see what the Minister said about the culture of the health system. There is more change to come. This should be the last time that any Minister for Health makes a fundamental change to the way in which we deliver health care with no notification to either the Opposition or the stakeholders and without any opportunity to consider the agreement in principle speech or the legislation in detail. There was no urgency; this debate could have been conducted in five days time. It certainly could have been delayed until those who oppose it had the chance to be heard. This is sausage-factory legislation and this process should not happen again. However, the Minister will be judged by her actions rather than her words.
      Mr KEVIN HUMPHRIES (Barwon—Minister for Mental Health, Minister for Healthy Lifestyles, and Minister for Western New South Wales) [10.43 a.m.]: I support the Health Services Amendment (Local Health Districts and Boards) Bill 2011. As the Minister for Health stated this morning, the objects of this bill are to amend the Health Services Act 1997 to establish local health districts and boards for such districts and to provide for certain statutory health corporations to be speciality networks with boards, to make related amendments, to enact provisions of a savings or transitional nature and to make consequential amendments to certain other Acts and statutory rules.
        What a fantastic day this is. I congratulate the Minister for Health not only on the work she has done to introduce this bill but also on its framework and context. This bill has been at least 10 years in the making; this is not something that has evolved over the past six months or 12 months, or even over the past two years or four years. This bill is the culmination of 10 years of hard work undertaken by the Minister. The network that she has developed over the years largely involves health professionals, clinicians and community leaders and members who were sick and tired of the centralisation and mismanagement of health services and a lack of leadership in this area. In fact, they have been witness to a revolving door at the leadership level of health services in New South Wales. Members opposite should not have said that they needed five more days to examine the bill. They have had 16 years to consider the Coalition's proposals in this area.
          The Minister for Health has more knowledge of the New South Wales health network than the combined rump of the Opposition has. Health officials who have worked with the Minister were working under the former Government's management. They approached the Minister in her role as shadow Minister expressing concern, fear and angst about the centralisation of services and mismanagement. Members of the Opposition should not say that this is new news; it is not. This Government has a clear mandate from the people—although it is not quite unanimous—given that the Coalition has 69 members in this place. This Government will make a difference and health was clearly highlighted as a major Coalition priority during the election campaign.
            The Minister for Health and the Premier have stated on many occasions that a Coalition Government will serve the people of New South Wales; that is, it does not expect the people to serve the Government. The best way to serve the people of New South Wales, particularly in the health sector, is to give them more say in the provision of services. They should have a say in where those services are delivered and by whom, and how they are managed. If members were to canvass the people of this State they would find that the issue of most concern is the mismanagement and lack of leadership demonstrated by the former Government with regard to health service delivery. The Coalition has committed to changing that culture, not only in the health sector but across the board. If a government disengages from the community, particularly in respect of health services, if it abandons the professional advice of the clinicians in particular and if it sidelines them it invites disaster. That is what has happened in New South Wales.

            Why is the health budget growing by 9 per cent a year? It is because the former Government continued to move health services to a centralised bureaucracy, to reduce frontline services and to increase backroom services to the point at which hospital beds have been closed in many of the areas that I represent. More money was being spent on vehicles to put people on the road to deliver a minimal outcome. Members opposite should not oppose devolution or decentralisation of health services—that is, putting knowledgeable local clinicians, front-line staff and community leaders in the driver's seat. They traditionally provided those services in our communities until the Labor Government deconstructed that system. As the Minister for Health said, the Coalition will reconstruct that system from the ground up.

            The member for Macquarie Fields, for whom I have respect on a number of fronts, said that the health budget has grown by 9 per cent a year. He has probably been expecting me to refer to a rural doctors' meeting held at Bondi a couple of years ago. However, before doing so I will respond to his statement about the increasing health budget. Given the size of this State and its extensive rural and regional areas we cannot continue to centralise health services. The former Government's mantra was that it would bring care closer to home. That cannot happen if local services, particularly in remote areas, are dismantled and people are encouraged to move to major centres for treatment.

            The New South Wales Labor Government had no cancer action plan or diabetes plan for western New South Wales. Members opposite should be ashamed about the disparity between Aboriginal health outcomes and the rest of the community's health outcomes and the fact that the gap is widening. The former Government forced people to travel to major centres for treatment by dismantling local services. Diabetes is out of control in many Aboriginal communities but members opposite failed to provide a service delivery plan. That was despite the numerous attempts made by local people in the regions to restore the balance. How could they target a community with an identifiable problem when the Government would not listen? People in rural and remote areas cannot relate to services provided by metropolitan hospitals. Of course we need clinical networks, and we had them until, to their shame, members opposite dismantled them.

            Our philosophy as a conservative-based Government, with the partnership between the Liberals and The Nationals, is very clear. There is a distinct point of difference between being in government at this point and what those opposite were providing previously. We do not want to go back to centralised command and control. We will devolve services. We will devolve responsibility back to communities. Why could the former Government not get recruitment in some of the harder to recruit places when the agencies could, when other non-government services could? I am not sure the previous health Minister understood that people on the ground who were working for NSW Health said they were sick and tired of the lack of flexibility, the bullying and manipulation that was going on and the lack of continuity in front-line services. No wonder the previous Minister could not get people to work in those hard-to-staff places. Why could she not get people to work at the forensic mental hospital if it was going to be staffed under a NSW Health system? She had to form a partnership with another agency because no-one wanted to work for NSW Health. People were sick of the culture. Why are a third of our nurses sitting in New South Wales, not working—sitting, not working—

            The DEPUTY-SPEAKER (Mr Thomas George): Order! The member for Marrickville will have her opportunity to contribute to the debate.

            Mr KEVIN HUMPHRIES: The member for Marrickville needs a reality check. Those opposite had long enough. They are a disgrace. They failed the people of New South Wales. The nurses supported us in the last election because of the good work the present health Minister was doing but also because they were not going to come back and work for that lousy lot. Because of the inflexibility of the work practices a third of our nurses are sitting outside the system. Why were hospitals such as Lightning Ridge being run by agency staff and locums for years and years? I ask the member for Macquarie Fields: Why should the taxpayers of New South Wales, because of lack of management, be paying top dollar for agency staff coming out of Queensland, not even New South Wales, to run some of our hospitals? It is not because other groups could not recruit to some of those remote places; they could and they were. The police were able to recruit and teachers were able to recruit. People in community services were able to recruit to those places that the former Government could not because the system failed and the locals lost control of how they wanted to deliver that service and have some say. Opposition member should not say that they will be watching; I hope members opposite do watch, because people in our communities want a change.

            Why was the 9 per cent annual growth figure—this is the important figure—growing out of control? Because those opposite were relying more on agency staff, on locums and on centralised services. They dismantled services out of many regional hospitals and smaller hospitals. I suspect the health Minister has a pile she cannot jump over of people who transferred from our smaller hospitals where basic procedures used to be undertaken to major hospitals such as Dubbo for procedures such as the taking out of stitches. This is ridiculous. We have costings on all that. Instead of a basic $75 procedure that could have been undertaken in Coonabarabran hospital people were transported to Dubbo—in the case of one lady, twice—to have a feeding tube inserted at a cost of about $4,000 to $5,000. People were paying not only for the procedure but also for the ambulance transfer and the bed being taken up in a major regional hospital—which was blocking someone else who really needed that service—when that procedure should have been undertaken at the local hospital. The former Government systematically deconstructed services that should have been maintained in those hospitals. Labor went to war with those doctors who knew and should have had more say in how those services should have been delivered.

            When the member for Macquarie Fields attended the Rural Doctors Conference two years ago or two and a half years ago this question came from the floor: What do we have to do to fix health in New South Wales? The reply of the member for Macquarie Fields was, "Join the National Party." He might well have told them to join The Nationals and Liberals, because most of them did. My good friend and a friend of the health Minister, Tony Joseph, head of emergency services at Royal North Shore Hospital, who used to be a supporter of a party that represented working-class people and working families, said, "These people have walked away from all the good advice we have given them. I will not support them anymore." That started a wave of clinicians wanting to have more say in how those services were delivered.

            Take heart that the 69 people on this side of the House took the advice of the member for Macquarie Fields, the shadow Minister for Health. Many people did join the Coalition parties. That is, many members on this side of the House are from the west, led by our good friend the member for Murray-Darling, who won every booth in Broken Hill. Congratulations on that. People wanted change. Members opposite knew that change needed to happen, and we will deliver.

            I commend the bill introduced by the Minister for Health and the fantastic work that she has undertaken. District networks will work. As the Minister said, we will reserve the right to adjust some boundaries. There may need to be some tweaking. Are people looking forward to being involved at the local and regional level? Yes, they are. Are they looking forward to taking on the responsibility? Yes, they are. It is what they want. We need to reinstate order and we need to reinstate a legitimate corporate governance system. That is what we will do. The only way we will get this State back to number one is to be totally committed, and the Premier has given the undertaking to restore community engagement.

            Those opposite disconnected from the people of New South Wales. If 26 March did not send that message strongly enough they have problems. They will be on that side of the House for a long time and they will occupy only one bench after the next election instead of two. They have to reconnect. We will do that: we have been given that mandate. We will not be compromising clinical care, as the health Minister outlined. We will maintain those specialty services, and the vast majority of people will be looking forward to it. I look forward to working with the health Minister over this term of government. We will help to provide the support needed in the community, to have those step-down facilities that will take the pressure off our whole system, not just in mental health care but also when we start to target some of those chronic diseases in the community. I commend the bill to the House. I commend the health Minister. I commend the Government. Most of all, we look forward to working with the community.

            Ms CARMEL TEBBUTT (Marrickville) [10.57 a.m.]: I speak today to the Health Services Amendment (Local Health Districts and Boards) Bill 2011. As the shadow Minister has indicated, the Opposition will not oppose this legislation, although I also echo his comments about the short time we have had to examine the detail of the bill not being repeated with future legislation. There are good reasons why legislation lies on the table for five days: to allow the examination of the legislation in detail. There is a certain similarity and familiarity in comments put forward by oppositions.

            I take this opportunity to congratulate the Minister for Health on her appointment. As a former Minister for Health I have had the honour and privilege of working with the men and women who make up our health system. It is an honour and privilege: they are inspirational people. I know the Minister the Health has long coveted this role. She now has it, and I wish her all the best in making the right decisions on behalf of the patients of New South Wales. As the Minister indicated in her comments on this bill, the bill seeks to replace networks with districts. The Minister has indicated that at this stage no changes are proposed to the boundaries of the health networks, which will become districts, and that the governing councils will be renamed boards and will take on the functions and key accountabilities of boards.

            I am pleased that no significant changes are being made to the boundaries of the existing health networks. There is no doubt that extensive consultation was undertaken by this side of the Chamber when we were in government to develop the local health networks and to establish the boundaries for those health networks. We released a discussion paper that resulted in extensive consultation with clinicians and communities across the State. We received some 400 submissions that culminated in the announcement by the Government of the day of the 18 local health networks in New South Wales.

            Those health networks, now to be known as districts, have really been in operation for only a few months. While the Minister has indicated that she may propose some changes down the track and that there would be extensive consultation if there were changes—and I welcome that—the reality is that change for the sake of change is not usually a good thing, particularly in a system as complex and as large as the New South Wales health system. It is important that the health districts have the opportunity to bed down their operations and to go ahead with their important role without the added pressure that a subsequent change in boundaries would bring, so I think this is a good decision.

            I am concerned, and I would seek the Minister's commitment, that there will not be changes to both the chairs of the governing councils, now to be known as district boards, and their membership because again there was an extensive process of consultation in the appointment of those chairs and also members of the governing councils. Advertisements were placed in metropolitan and regional papers and a rigorous application process was undertaken. Various stakeholders in the health system were involved in putting together a process to appoint the chairs and the governing councils. There is no doubt that it had to be done in a timely way because we were seeking to put those in place to meet the requirements of the National Health Reform Agreement. The Australian Medical Association and other stakeholders were involved in putting together a process that everyone agreed was a very good process. It resulted in chairs and members from a range of different backgrounds such as community leaders, leading clinicians, academics and businesspeople.

            I seek a commitment from the Minister that those chairs and governing council members will continue because those people are just coming to terms with their role; they are just gaining understanding and experience. I have heard that the governing councils, now to be known as boards, are starting to work together effectively and it would be a shame if the membership were to be changed. The Minister may wish to appoint additional people—that would make sense because the boards will take on some new responsibilities, but I would like a commitment that there will not be a dismantling of the current membership of the chairs and the boards.

            I appreciate that these are early days and that the Minister today is focusing particularly on governance changes. However, there is no doubt that if the Minister and the Government are to address the many challenges confronting the delivery of health services in New South Wales, delivering the right care in the right place at the right time, it will take substantially more than simply governance changes. We need to know—and I will be interested to hear from the Minister—whether the Government will sign the National Healthcare Agreement. We indicated during the election campaign that we were committed to signing that agreement. The Coalition did not make any such commitment. Since the election I know the Government has indicated that it is looking very seriously at signing the agreement. The agreement brings major benefits to New South Wales—some $1.2 billion over the next four years. That is money for more beds, more surgery and more equipment for our hospitals. Some 488 new beds are being opened across hospitals in New South Wales as we speak and over the next four years it will contribute to a total of 840 new beds and about 800 additional nurses to support those new beds, as well as extra surgical procedures.

            If the health system is successful in receiving the reward funding, that funding will go towards our emergency departments and hospitals. I seek an indication from the Minister that the Government will commit to signing the National Healthcare Agreement because if it does not, it will place our health services in New South Wales at major risk. Similarly, we have not heard much about how the Government intends to address the pressure on our hospitals and emergency departments from a growing and ageing population, what it intends to do about the workforce challenges of the future or the rising incidence of chronic disease that is impacting on our hospitals. Both government and the community must embrace lifestyle changes in order to reduce the risks and incidence of chronic disease. We will be closely watching these matters into the future to see how the Government will address these key challenges.

            Before I conclude I must address some of the issues that the Minister for Mental Health, Minister for Healthy Lifestyles, and Minister for Western New South Wales raised. It is somewhat unfortunate that the Minister does not seem to have made as yet the transition from Opposition to Government. I am sure he will manage to do that over time but it will take more than rhetoric and mudslinging to address the substantial challenge confronting the delivery of health services, not just in New South Wales but across the country and internationally. These are not New South Wales-specific issues. The delivery of health services is an international challenge with a growing and ageing population and the rising cost of health services. Some of the comments from the Minister demonstrate his failure to make that transition to being a Government member who needs to have a substantial debate about these issues.

            The Minister does not seem to appreciate that New South Wales has the lowest diabetes mortality rate of any State in Australia. When Labor was in government it implemented a chronic disease management program to address precisely the issues that the Minister raised. We established renal dialysis services across New South Wales. Of course there is more to do, there always is, but we have seen a dramatic reduction in the rate of death from cardiovascular disease and from cancer. I urge the Minister to examine these issues and to recognise that if he is to fulfil the responsibilities that the people of New South Wales have now placed in him, we will want to see more than the kind of muckraking that he exhibited in the House today. In the future we want to see clear indications from the Coalition Government on how it will address the very important issues that confront the delivery of health services in New South Wales. For the sake of the patients of New South Wales and the people who work in the health system we will look very closely at these issues into the future.

            Mr ANDREW CONSTANCE (Bega—Minister for Ageing, and Minister for Disability Services) [11.08 a.m.]: I speak strongly in support of the Health Services Amendment (Local Health Districts and Boards) Bill 2011. First, I congratulate the Minister for Health, and Minister for Medical Research not only on her appointment but also on the years of service that she gave as shadow Minister. She spent days and months travelling around the State talking to local clinicians, hospital action groups, mayors, councils, chambers, medical staff councils, nurses and allied health professionals about this exciting new arrangement for the New South Wales health system.

            The Minister and I had an opportunity to meet with the Pambula Hospital Action Group and local medical staff council in the southern part of the State. When the Minister spelt out our intentions, the doctors in particular lit up with excitement about the cultural change that this legislation would bring about. The cultural change is the exciting aspect of this reform. A month into the job we now have what is substantive and major reform that will change the culture. It will devolve decision-making back to local communities. It will empower them to make the right decisions in the interests of patient safety and that is what excites me about this legislation. I believe this reform will now stand the New South Wales health system in good stead for many years to come. I believe that in itself is worthy of reflecting on in the introduction of this bill today. Congratulations to our new health Minister in that regard.

            First I want to respond to a point made by the shadow Minister for Health when he spoke about this legislation. One aspect the member for Macquarie Fields tried to reflect on but did so badly was that establishing local health districts would mean that no networking would take place across district boundaries. The health Minister made it clear in the Making it Work policy that there will be functions that will need to continue to operate at a statewide level and, for that matter, potentially at a regional level, to be coordinated between districts. The health Minister also cited the fact that there is a need to support and retain the clinical networks that link medical experts across the health system. That point did not seem to register with the member for Macquarie Fields. It is important that that be addressed. We will not allow scare campaigns or fear campaigns to emanate from the Opposition when we have clearly made that point and done so strongly.

            One of the key features of the O'Farrell-Stoner Government is the fact that we want to devolve decision-making back to communities as best we can, regardless of whether it is in regard to health, disability services, planning, or the like. This legislation is about that change. It is about putting local people back in charge of their local health system. I do not need to reflect on the history of the area health services regarding the way in which they grew and then were dismantled, and then grew again, and everything else that occurred over the past couple of decades. But the point that needs to be made is that we have to trust people in this State to do the right things at a local level. Certainly the breakdown in trust between medical staff councils and the bureaucracy has been a key problem with regard to health in this State.

            One of the exciting things about this legislation is that it is designed to reassert trust into the health system, and it is designed to get the bureaucracy and allied health professionals, nurses and clinicians back making decisions together, in the interests of patients. As the Minister for Health said, we are committed to ensuring that every decision and every person working in the health system is focused on patient outcomes. One of the key features of this Government is that we want to be open, consultative and transparent in our approach. Therefore we will be looking for ways to improve access to timely, quality health care across the State, and that means ensuring that the doors are open.
              As the member for Bega I can say that in the past 24 hours alone I have started to have constructive dialogue with the chief executive officer of the former local health network. I will now work to make sure that those relationships broaden to the medical staff councils that exist throughout the south-east region. As the Minister for Ageing I can indicate that in the next 20 years we will see a 50 per cent increase in the ageing community over the age of 65. The very clear instruction from the Minister for Health across the board is that we want to avoid unnecessary hospitalisation through a greater emphasis on preventative health and better management of people with chronic disease. That drive needs to happen at a local level, and that is where the board structure becomes incredibly important because of the varying demographics across the State.

              One of the things that worries me also—and this is something that the incoming Government has now inherited following Labor's mismanagement of the health system—is that we do not have a true feel for the extent of the deficits that exist within the current structures. The local health network deficit in my region is unknown, but everyone knows that there is a deficit. This is the type of thing that will continue to present problems as we move on, in relation to what we are inheriting in that regard, the availability of funding, and the pressure the bureaucrats are currently under because of that availability of funding. In our region we also have a unique situation because we have the interface between the Australian Capital Territory health system and what was the local health network, now to be a district health board. That in itself presents some significant challenges, particularly in light of the fact that potentially upwards of $90 million is being sent to the Canberra health system to treat New South Wales patients, and yet New South Wales patients comprise 25 per cent of the waiting lists in Canberra.
                We are dedicated to improving facilities and access to appropriate and timely health services on the ground within local communities. That is the pleasing aspect in relation to seeing new health infrastructure, particularly in the south-east area of the State. I am incredibly grateful for the commitment the health Minister has given of providing $10 million towards the new regional facility to be located in Bega. The Federal budget will be handed down next week, so we will wait to see what happens through that process. However, it was the New South Wales Liberals and Nationals who got the ball rolling in that regard. That new infrastructure development will be well supported, as I said, by the local health district, which will be directly involved in local decision-making and in driving the changes to health that we need at a grassroots level.
                  The New South Wales Liberals and Nationals are about giving real control at a local level. It is terrific that the Minister for Health introduced this bill as her first piece of legislation. I am particularly grateful to the health Minister, who has indicated that some minor changes may be made with regard to demographic aspects because of concerns that might exist given vast distances, particularly for rural areas. Country people, in particular, have been extremely passionate about what this proposal means for their local communities.
                    As I said at the commencement of my contribution, and I will conclude on this note, the health Minister has travelled the width and breadth of this State consulting for many years. This reform is not something that has just popped up in the last five minutes for those opposite. For many years Labor members have commented in this Chamber about the "Making it Work" policy. In fact, both the member for Macquarie Fields and the member for Marrickville have for many years commented on the policy. Although Labor members feign, "We haven't seen this", the fact that Hansard proves that Labor members have been providing comment on the policy for many years puts that issue to bed. It is very exciting and I congratulate the Minister for Health on this. More work is to be done and this is but the first step of many in driving change.

                    The member for Marrickville touched on the healthcare agreement. When the former Labor Government was in power it signed up to an agreement, which was reversed. It then was willing to rush into the next agreement. The former Labor Government was willing to hand over the GST funding willy-nilly, without any thought as to what that would mean to the State's finances. We then had another agreement once Gillard tore up Rudd's agreement, which again the former Labor Government was immediately willing to sign up to. Thank goodness New South Wales now has a responsible government that is prepared to act in the interests of the State and take time to work through the fine print. The Liberal-National Government was not prepared to rush into it. That is a healthy sign for the future of this State. Without doubt this is probably one of the most important pieces of legislation we will see in terms of driving reform in the health system of this State.

                    Ms NOREEN HAY (Wollongong) [11.20 a.m.]: I speak on the Health Services Amendment (Local Health Districts and Boards) Bill 2011. Firstly, I congratulate the Minister for Health on her achievement of that position and I also congratulate the Deputy-Speaker on his elevation. As early speakers from this side of the house have said, the Opposition does not oppose this bill. Following the Council of Australian Governments [COAG] agreement in April 2010 to a $3.4 billion national funding package to improve access to public hospital services, New South Wales immediately began to see the great benefits of those reforms through the opening of additional new beds in our hospitals. These included enhancements at the following sites that have been announced since May 2010: 12 beds, Prince of Wales Hospital; 20 beds, Campbelltown Hospital; 21 beds, Wollongong Hospital, 26 beds, Nepean Hospital, 27 beds, Sydney Children's Hospitals network; 17 beds, Sutherland Hospital; 22 beds, Royal North Shore Hospital; 16 beds, Maitland Hospital; 16 beds, John Hunter Hospital; 19 beds, St George Hospital plus four special care cots; 10 beds, Mount Druitt Hospital—

                    Mrs Jillian Skinner: Point of order: My point of order relates to relevance. Whilst it is very interesting to hear about the number of beds that have been opened under the Council of Australian Governments reforms, this bill is not about the Council of Australian Governments, COAG. The legislation is about the establishment of local health districts, and the member's contribution is not relevant to it.

                    The DEPUTY-SPEAKER (Mr Thomas George): Order! The bill is about health districts and boards. The member for Wollongong will return to the leave of the bill.

                    Ms NOREEN HAY: The COAG agreement was discussed early and this is part of my address on the bill.

                    The DEPUTY-SPEAKER (Mr Thomas George): Order! A previous speaker referred to the COAG agreement, but it is not part of the bill. The member for Wollongong will return to the leave of the bill.

                    Ms NOREEN HAY: An extra 455 beds to date for our public health system will be at risk—

                    The DEPUTY-SPEAKER (Mr Thomas George): Order! Is the member for Wollongong disputing my ruling?

                    Ms NOREEN HAY: No.

                    The DEPUTY-SPEAKER (Mr Thomas George): Order! The member for Wollongong will return to the leave of the bill.

                    Ms NOREEN HAY: I have stopped reading out the list of hospitals. These are my comments in relation to the Health Services Amendment (Local Health Districts and Boards) Bill 2011, how it affects the health system and how it previously affected the health system. There has been ample discussion here about that this morning.

                    The DEPUTY-SPEAKER (Mr Thomas George): Order! The member for Wollongong will return to the leave of the bill, which deals specifically with local health districts and boards.

                    Ms NOREEN HAY: Mr Deputy-Speaker, part of my contribution is that it is a far more important task than introducing a bill to change the names of governing councils to district boards. Our public system could be at risk if the Liberal-National Government does not sign up to the COAG agreement and that will affect the implementation—

                    Mrs Jillian Skinner: Point of order: My point of order is relevance. I do not believe that the member for Wollongong has got it. This is not a COAG bill. It is about governance of the Health system, introducing local health districts and boards. It is not about COAG or individual hospitals. I ask that the member for Wollongong be directed to return to the leave of the bill.

                    The DEPUTY-SPEAKER (Mr Thomas George): Order! The member for Wollongong will return to the leave of the bill. This is her final warning. The bill has nothing to do with COAG.

                    Ms NOREEN HAY: The Opposition considers the move to introduce a bill such as this, which the Opposition does not oppose, is simply to change the names. If I can refer to the former Government's position in relation to health boards, in November 2010 the former Minister for Health, Carmel Tebbutt, announced there would be 15 chairs to lead the governing councils of the New South Wales local health networks. In December 2010 the former Minister for Health announced the membership of those governing councils, and that as at 1 January 2011 the new local health networks would replace the existing health services with their own budgets, management and accountabilities.

                    Those governing councils reflect the former Government's commitment to strengthen local decision-making and clinician engagement. As to the establishment of the proposed new local health networks, the former Government had conducted an extensive consultation process with health professionals and community members across the State to seek their input into the new local health networks; issued a discussion paper and a further round of public consultations to inform the configuration of the new health system and what was proposed; passed an Act of Parliament that established local health networks, the Health Services Amendment (Local Health Networks) Act; appointed a chairperson and members of 15 governing councils, the body responsible for ensuring that the local health networks were accountable and the body that delivered effective and efficient health services and performed against targets; and established 18 local health networks, which were made up of eight geographically based local health networks to cover the Sydney metropolitan region, seven geographically based local health networks to cover rural and regional New South Wales, and three specialty networks for children's health, forensic mental health, and services delivered by St Vincent's Health.

                    Governing council members were appointed by Cabinet following a selection process convened by the chairs, which included independent advice. The final round of recruitment for local health network chief executives was underway at the time of the election. The chief executives were then to report to the governing councils. I place that on the record to illustrate the suggestion that this is merely changing the name of what was the intention as part of the Health Services Amendment (Local Health Districts and Boards) Bill 2011. I am on record several times as saying health service delivery in New South Wales, and indeed, Australia, is the best in the world. Speaking from my own experience, particularly at Wollongong and St Vincent's hospitals, our health service delivery is second to none throughout the world. Without question my youngest son and my grandson, as was recently reported and as I referred to in my inaugural speech, would not be alive today but for the public health service in New South Wales.

                    But the cost of health service delivery increases every year and the demand on our health system is ever increasing. Without stipulating how we will deal with these increases demands and how that growth in need and costs will be meet, it makes it very difficult to see the impact of these kinds of changes. I look forward to the Government providing greater detail. As the Minister has indicated, there will be tweaks and changes. In the future we will have to look closely at the agreement with the Commonwealth in relation to the delivery of health services. I understand that the proposed agreement, which will give additional funds to New South Wales, is required to be signed in July.

                    Very little has been said about the announcements that have been made about the changes. I look forward to increased investment in health infrastructure—particularly for Wollongong Hospital, the main regional hospital in the Illawarra—as has been indicated. The Minister for Mental Health spoke about increased recruitment—how it will be achieved and delivered. I will be interested to see the proposed changes to recruitment processes in regional New South Wales that will achieve the outcomes that have been outlined. I echo the comments of a previous speaker on this side of the House regarding the speech of the Minister for Mental Health. I refer not to what he said but how he said it, which was disappointing. In that regard I hope we see a change in the future.

                    Debate adjourned on motion by Mr Ray Williams and set down as an order of the day for a later hour.