Workers miss out on cheap healthcare

By FRANCESCA MOLD POLITICAL REPORTER

Nearly 50,000 working New Zealanders will miss out on a community services card, even though beneficiaries and superannuitants on the same income will still get cheap healthcare through the scheme.

The anomaly - which risks alienating core low-income Labour voters - was defended by senior ministers, who said the Government would not provide the extra $14 million needed to extend the card system to workers on the same basis as beneficiaries.

The Green party criticised the move for creating "gross inequities."

On April 1, benefit and pension payments were increased by 3.98 per cent to compensate for inflation.

As a result, about 1270 superannuitants and 40 beneficiaries found their income level had risen above the limit for a community services card.

So these people would not lose access to cheap healthcare, the Government had to lift community card thresholds to match the new benefit rates.

But the cabinet decided yesterday to exclude 48,000 working New Zealanders who would otherwise have become eligible for the card if their income threshold had also been lifted.

The community services card subsidises doctors' visits and the cost of medicines for low-income New Zealanders.

Health Minister Annette King also announced an immediate review of the community services card, with a view to scrapping it.

"We're not cutting anything out for people who have got something now," said Mrs King.

"What we are not going to do is to lift it to take in a whole lot of other people when we'd rather look at the community services card itself."

But baulking at the $14 million pricetag shows how tight a hold the Government is keeping on any extra spending ahead of its May 24 Budget.

"Everybody knows the Government's budgeting is extremely tight ... We have to look at the money carefully and Mrs King's view, which the cabinet accepted, was that if she had $14 million to spend this would not have been her top priority," said Prime Minister Helen Clark.

The decision lowered the cost to $150,000 to $200,000.

Under the present system, a single person living alone receives a community services card if earning less than $19,689 a year. A couple with no children or a single parent with one child must earn less than $29,398 to be eligible. A three-person family has to earn up to $34,243, a four-person family up to $39,089, and a family of six less than $48,782.

These limits will rise by almost 4 per cent for beneficiaries after yesterday's move.

The card entitles adults to $15 off the price of a visit to a GP, and a child over 6 to a $20 subsidy.

Cardholders pay only $3 per Government-subsidised prescription.

Mrs King criticised the card as a "blunt instrument" for giving low-income earners access to affordable healthcare.

She said getting rid of the card, which relies on the fee-for-service system most GPs are financed under, would fit better with the Government's plan to move to bulk-funding doctors based on the population they served.

A replacement system would not be in place until the 2002-03 financial year, she said.

But the Greens' welfare and employment spokeswoman, Sue Bradford, said the scheme had fundamental problems and should be scrapped now.

She said yesterday's decision was surprising from a Labour-Alliance Government which was expected to have a far more egalitarian approach.

National's health spokesman, Roger Sowry, called the move a huge slap in the face for low-income working families and said it reflected a major policy change.