Opposition health spokeswoman Anne Ruston and independent senator Jacqui Lambie moved the motion to discharge the Private Health Insurance Amendment (Modernising the Private Health Insurance Rebate) Bill on Tuesday afternoon. The move, an alternative to voting the bill down, received support from the Coalition, Greens, One Nation and independent senators, meaning the legislation cannot continue through the Senate in its current form.
Butler held a snap press conference on Wednesday afternoon to vow the government would bring the exact same bill back on Thursday. "This is an absolute travesty … that flies in the face of what I thought was a clear understanding across the parliament of the need to fund better aged care services," he said, blaming what he called "a rush of blood to the head by the new leadership of the Greens party, that's all become a bit of a pile on in the Senate and a discharge of a bill instead of a reasoned debate."
The bill would have wound back the rebate Australians aged 65 and over receive on their private health cover from April next year, banking $3 billion over four years to be spent elsewhere in the aged care sector. Butler has said the savings would provide an additional 5000 aged care beds per year.
Opponents argue low- and fixed-income pensioners would be least able to absorb the extra costs, estimated to run to hundreds of dollars a year for those with the highest cover. The ABC has reported about $1.6 billion of the forecast savings would be clawed back from pensioners.
Ruston said Butler should "take the hint" and drop the cut for good. "Today the Senate stood with older Australians. Labor was left standing alone with its cuts," she said. Greens leader David Shoebridge said his party would support the legislation if pensioners were exempt, arguing it was "plain offensive to see Labor looking for over a billion dollars in savings from cutting rebates to pensioners when they refuse to even consider taxing record gas export profits." Lambie accused the government of trying to "balance the budgets on pensioners."
The defeat is Labor's latest in the Senate over reforms to the $40 billion aged care budget. The Greens-Coalition alliance had already forced the government to spare Meals on Wheels from a merger, provide more human oversight of algorithmic assessments of clients' needs and fast-track 20,000 home care packages.