Paul Keating, his government still trailing in the polls before next month's general election, yesterday offered Australians the most radical overhaul so far of the country's public health insurance scheme.
The Prime Minister sought to overcome the worries of ordinary Australians about their health-care system, and how to pay for it, by promising A$1bn (pounds 500m) over the next two years to revamp Medicare, the Labor government's public health system.
At the election, on 2 March, Mr Keating will be trying to win an unprecedented sixth term for Labor after 13 years in power. Introduced when Labor took office in 1983, Medicare is a national health insurance system funded by a levy on people's incomes. Doctors work privately, but have the option to obtain payment from patients, who then reclaim money from Medicare, or direct from Medicare itself.
Medicare covers most basic medical services, but it has been accompanied by an ever-increasing growth in hospital waiting lists for non-urgent surgery. It is already the government's largest public spending programme.
Mr Keating promised that the extra money would go towards reducing waiting lists and providing rebates on some services which Medicare does not cover, such as dental work and physiotherapy. The government will also offer rebates of A$300 a year to help lower-income families take out private health insurance, thereby reducing the burden on the public system. If Labor is re-elected, it will spend a further A$400m on revamping Medicare in the third year of its next term.
"It doesn't come any better than this," Mr Keating said of his proposals, which will be funded by cuts to other unspecified, public programmes. Mr Keating hopes his health policy will steal a march on that of the Liberal- National coalition, the conservative opposition, which is due to announce its health plans later this week.
The government has accused the opposition of wanting to tear up Medicare, and return to a system of competing private health insurance schemes.
How Australians respond to Mr Keating's health promises could be crucial to the government's campaign fortunes over the next three-and-a-half weeks. The opposition has maintained an opinion poll lead of 10 points since Mr Keating called the election 10 days ago.
A poll published yesterday, before the health announcement, in the Australian, Rupert Murdoch's national flagship newspaper, showed that Labor had narrowed the gap to 7 points. Mr Keating led John Howard, the opposition leader, as preferred prime minister by 42 points to 38.
Labor suffered a potentially damaging setback last weekend when the Labor government in Queensland lost a crucial by-election, putting the state government's survival in doubt. The impact of this on the election campaign, though, may not be severe. Opinion polls indicate that up to 40 per cent of voters have still not made up their minds.