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Is the post-welfare state inevitable in Australia and if so, is it of value? Discuss this by focusing on health. Essay Example

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Post-Welfare State Inevitable in Australian Health Industry


Global nations have over the years sought to establish a balance in economic and social status in their respective societies. In this regard, a majority of the governments have over the years developed social policies, management structures and regulations through which societal resources are redistributed in the economy. Traditionally, this was achieved through communism and socialism systems of administration. For instance, nations such as Germany, in the World War 1 period applied this governance structure (Rahden, 2008, p.299). Through this approach, all citizens were made dependent on the state for their well being and social needs satisfaction. However, these dependencies posed threats and challenges in the long run. Consequently, the systems were abandoned. However, due to the potential merits derived from the adoption of such practices, global governments re-invented the systems through the welfare State principles. The welfare state programs seek to provide social services to the community on an equality basis regardless of their earnings and social status. As such, global governments resulted to the provision of key fundamental social services such as healthcare and education services.

This has been the case in the Australian economy. The Australian government through regulatory processes introduced a healthcare program through which subscriptions enhanced the provision of free healthcare services to all. Consequently, the Australian healthcare industry model has become a template for other global nations in their strive to increase healthcare services quality (Behan, 2006, p.56). This essay reviews the merits of the Australian welfare state healthcare system, its current and future challenges as well as the rationale for a post-welfare state on healthcare provision in the economy.

Merits of Welfare State in Australian Healthcare

The Australian healthcare system program has over the years grown in popularity and fame. To this extent, the nation’s healthcare model has been replicated in many nations in a bid to achieve its merits. On one hand, the health care program increased the healthcare system. Traditionally, healthcare services were based on the available funds by the individual patients. Consequently, patients received differing healthcare services qualities in the market. As such, there was quality irregularity with the rich in society acquiring quality healthcare and the poor low quality or no healthcare services at all. The introduction of the welfare state principles in the nation’s healthcare industry hanged on this trend. On one hand, the government funds all the health facilities equally. Therefore, as Thomas (2012, p.275) argued, regardless of their location or size, healthcare facilities in the Australian economy have relatively equal Medicare facilities of similar quality. Thus, such facilities allow for equal and quality healthcare services provision across the societal status regardless of individual status or earnings. As a result, this has facilitated increased national health status improvement. The current quality and efficiency levels in the Australian healthcare system can be attributed to the welfare state principle that has not only facilitated increased facilities funding, but also their widespread as well as the recruitment of enough and qualified staff workforce. In addition, the development and establishment of the healthcare program resulted to increased national productivity.

Currently, Australia is acknowledged as one among the most developed nations in the globe. This is attributed to a robust and highly skilled national workforce. Reviews on human resource development create links between human resource health and productivity. A study by Shiu-Yun, FuDebra, Courtney and McAvan (2006, p.29) established that a healthy labour market registers increased productivity levels that an unhealthy labour market. This is as a result of the increased devotion and dedicated time to production services and the subsequently increased motivation to production emanating from social needs satisfaction. The study concluded that an economy’s growth is dependent on its labour market status. Therefore, based on this analysis, it can be established that the Australian economy development to its current global leading status is directly attributable to its quality and efficient healthcare industry. Thus the Australian welfare state healthcare programs have facilitated and enhanced its economic development.

Further, reviews in the Australian society life expectancy levels registered increased life expectancy levels. This implies that the mortality rate in the market has significantly reduced. This is evidenced by the increased percentage of successful births as well as the increased elderly population base. Unlike in the past when the national senior citizens died off due to increased health complications and the lack of proper and quality Medicare, the current Australian healthcare systems treats this group with due care facilitating its eventual life expectancy increase (Perenboom, Herten, Boshuizen and Bos, 2004, p.27). The healthcare system has special care and programs for the elderly in the society. As such, this shields the elderly people for infections by the opportunistic diseases associated with old age. The increased number of elderly senior citizens in the Australian society is a clear indication of the increased healthcare quality, efficiency and influence in the market. Bed on a review of the merits accrued since the inception of this system it is evident that the Australian society has tremendously benefited from the welfare state provision of healthcare and services system.

Challenges of the Welfare State in Australian Healthcare

Despite the merits of the welfare state approach in offering health care services in the Australian market, the system faces a large number of challenges in its execution. These challenges have accrued on the system in the long run and lead to the debate and discussion of whether a post welfare state on the Australian healthcare system is inevitable and of much value to the society into the future. In order to address the value of a post welfares state approach on the healthcare industry, this section reviews on the challenges facing the current healthcare system.

Shamsullah (2011, p.27) stated that on one hand, the Australian healthcare faces the risk of fiscal illusion. Currently, the government funds the healthcare system through funds collected as deposits by all working citizens in the economy. Through these pooled together funds, the government funds the healthcare industry right from the facilities establishment, equipping them, drugs provision, all through to the recruiting and retaining of qualified healthcare providers. Although this system has worked to the merit of the disadvantaged society members its cost implications are g-huge. Unlike in the past, the current global market has increased competition for qualified healthcare staff.

As a review by Christmas and Hart (2007, p.176) established, the global healthcare industry faces an increasing shortage of qualified medical professionals. Therefore, this has increased to the high costs of recruiting and retaining such staffs. Therefore, this has increased the cost on the Australian government healthcare provision costs. As such, the government has to source funds from other avenues besides the nation’s direct contributions. If the government raises the current contributions rate, the healthcare system would emerge unaffordable to the poor in the society of whom the program targets. Therefore, instead of raising the current subscriptions the government has resulted to utilizing funds from other government revenue sources to fund the healthcare system. Although this is an ideal redistribution strategy in the society, it has negative implications in the long run. Funds targeted for long term development projects are currently diverted into the healthcare industry a trend that is only in the short run. Therefore, the welfare state system in the Australian healthcare system risks failure into the future for lack of sufficient funds. The system is currently depriving the economy is much needed investment and long-term development funds.

An additional challenge on the system is the increased life expectancy in the market. As discussed under the merits part in this essay, the Australian healthcare system has enhanced quality healthcare to the elderly consequently increasing their life expectancy rates. Although this is a positive development, it increases the dependability nature. The elderly in the society have no direct employment or incomes to contribute the health subscriptions from. Therefore, their services costs are born by the economically viable generation. However, the Australian population structure has changed over the years. Currently, the society has a large number of elderly members that the young and working population. This structure is a major challenge to the existing healthcare system. The Australian healthcare system is structured on a pay –as –you-Go (PAYGO) structure (Esping-Andersen, 2002, p.201). Under this social structure funds are collected from the existing working population and simultaneously disbursed to the needing society. This form of societal funds management serves as an ideal wealth and resources re-distribution approach where funds are collected from individuals earning them and availed to those in their need at the time. The working of this principle is based on the pyramid approach in its management. As such, the contribution base must at all times be larger and broader than the receiving base. Through this PAYGO approach, if the receiving base extends more than the contributing base, the system collapses.

A case study of the application and failure of this system can be cited in the USA social securities fund. Sawant (2010, p.23) argued that iinitially, when the baby boomers population was at its prime, the fund had a pyramid structure with its base wider than the recipients, however, a change in the nations population structure and the increased number of retired baby boomers and a small base of the working population led to the funds negative cash flows and its current management and funds repayment challenges. The USA example is a clear indication of the future awaiting the Australian healthcare industry. As the life expectancy levels rise, the population is increasingly growing dependent on the working small base Thus, the system faces the risk of increased contributions into the future or the eventual collapse of the systems administration.

Besides the costs aspect, the Australian healthcare system costs have increased due to misuse of the facilities. The society has developed a culture and perception that the services are free and thus ought to be entertained irrespective of the expenses implications. Consequently, services that were traditionally offered by other societal structures such as the orphanages and homes for the elderly in the society no longer exist. Instead of family members catering for such expenses and services on their family members, the services are left at the hands of the health facilities. In essence, there is little difference between illness and sickness arising from such neglecting. Therefore, the healthcare facilities incur costs in the provision of services that do not fall under their mandate. As a result, this increases the overall societal costs of healthcare provision. With the already existing costs and funding constraints, the Australian healthcare system is bound to fail in the long run. Based on the above analysis, it is evident that the welfare state system administration on the Australian healthcare is bound to fail. This raises the need for the establishment of alternative healthcare management systems besides the welfare state system. As such, the development of a post welfare state healthcare system in the Australian system is inevitable in a bid to resolve the existing and forecasted Australian healthcare industry challenges.

Post Welfare State on the Healthcare System Value

As already established the current welfares state approach in the Australian healthcare industry is not performing as expected. Therefore, it is imperative and inevitable for the society to adopt alternative healthcare systems under the post-welfare state healthcare systems. In this regard, the economy has a range of options for adoption yielding a wide range of merits on the society. One among the post welfare state alternative include the establishment of friendly associations’ society’s membership programs. Friendly associations are groups formed by individuals with similar interest in order to safeguard their interests. Through the friendship associations, individuals offer regular subscriptions in return for support in the event unfortunate events occur in their lives. Such events include sickness or death. Through the adoption of these associations, the poor and less advantaged in the society can poor resources together to facilitate the repayment of healthcare expenses when need be. Through the development and growth of these associations the societal culture will change. Currently, the society perceives the healthcare services as free and thus misuses the facilities. However, through the association regulations, the healthcare facilities and services utilization will be controlled. For instance, the membership benefits will stipulate the nature and kind of sickness and diseases on which members expenses would be covered (Jamrozik, 2009, p.280). As a result this would reduce the current rate of healthcare facilities misuse. In addition, the membership groups would facilitate the development of other social institutions such as institutions caring for the elderly and homeless in the society.

Through the establishment of these alternative institutions in the Australian society, the burden and scope of services in the healthcare facilities would be significantly reduced. As evidenced, a major drawback and failure contributor in the welfare state healthcare system is the existing wide services scope in the industry leading to increased cost implications in the industry. Therefore, the establishment of these alternative social institutions and the eventual reduction in services scope will significantly reduce healthcare services costs in the Australian market, making its relatively affordable.

In addition, the adoption of the alternative post-welfare state in healthcare services in Australia will allow the government an opportunity to focus on development agendas rather than on the recurrent social services provision. Currently, as evidenced in the challenges analysis section, the Australian government allocates a proportion of the national GDP towards healthcare services provision. As such, funds that would have been allocated to developmental activities in the economy such as in infrastructural development are channelled towards the healthcare industry recurrent budget on drugs and healthcare providers’ acquisition and remunerations respectively. As such, the current opportunity cost of providing free healthcare services in the Australian market is high on development projects. Therefore, he adoption of an approach that would relive the government of this recurrent expense burden would significantly increases the process overall development expenditure. Through the post welfare state approach in managing the Australian healthcare expenses, the citizens and the membership groups will fund the industry recurrent expenses.

These expenses include the hiring and retention of qualified medical staffs as well as the acquisition of appropriate medical drugs. On the other hand, this will enable the government concentrate on the funding and development of developmental and capital aspects in the healthcare industry. For instance, such an alternative adoption will enable the State acquire increased funds for the establishment of new healthcare facilities in the economy. Further, the government will invest in other capital expenditures in the industry as such as the acquisition of modern and appropriate medical equipment in the market. Medical technology and practices change continuously. Therefore, it is imperative for health care industries to invest heavily in research. Although the Australian healthcare industry focuses on research, funds challenges have been a major hindrance in its execution. However, if the State is relieved off the recurrent expenditures it is most likely to increase its allocations to the capital ventures in the healthcare industry. As a result, the Australian healthcare industry will acquire increased research, facilities and equipments in the long run. A study by CDISC Clinical Research Institute (2011, p, 21) argued that Medicare services quality are determined by the nature of research and equipments available to the healthcare providers. Therefore, based on this study analysis, it is apparent that the Australian healthcare industry will acquire increased quality status higher than the current status.

Finally, the adoption of a post welfare state approach to the Australian healthcare industry will relive the nation of the increased taxation rates. Opponents of the welfare state approach in social services provision argue that the approach leads to increased government spending. As such, the government expenses on the social services provision increases the respective governments need for increased revenue collection. As such, the opponents argued that the respective government ventures resulted to increased tax base and scope expansion. Consequently, the tax burden on the population is increased. Therefore, relieving the Australian government the burden of providing affordable and free healthcare services, and instead laying the burden on civil societies and self help groups as well as other non governmental agencies, will substantially reduce the government expenses and thus lead to the development of tax laxed policies substantially reducing the overall tax burden on the entire population base (Karagiannis and Madjd-Sadjadi, 2007, p.122). This will enhance personal development as well as an increase in the economy disposable income base, a prerequisite for future economic growth and development. Therefore, based on this analysis, it is evident that the establishment and development of a post –welfare state approach in the Australian market is inevitable. Moreover, it is clear that the adoption of this alternative will yield increased benefit to the entire population and thus of value to the society.


In summary this essay reviews the concept of welfare state approach in the provision of social services such as healthcare and education. In this regard, the essay argues that despite the merits accrued from the development and adoption of such systems by global governments, they have a range of challenges warranting a perception change and social services change. In order to develop a practical approach on the issue, the essay evaluates the nature merits and challenges of the welfare state in the Australian healthcare industry. In its analysis, the essay establishes that the welfare state approach has enhanced healthcare quality improvement in the Australian society. Further, the approach has enhanced increased life expectancy as well as equality in healthcare services provision in the market regardless of the society member social and economic status. However, the essay analysis establishes that the welfare state management of the Australian healthcare industry faces a range of challenges both current and future.

On one hand, the system faces a misuse culture with an increased failure in other social structures. For instance the review establishes that traditional structures such as family systems to care for the elderly, homers for the homeless and centres for caring for the senior citizens in the society have since declined. As a result, these have increased healthcare provision costs. Further, changing population structures in the Australian society and the increased dependency by the aged population has altered the PAYGO principle in the welfare State management systems. Therefore, based on these principles, it is apparent that a post-welfare state approach is inevitable. Finally an analysis on the industry reveals that the post welfare state approach is of value to the society as it will facilitate re–establishment of social support structures, reduce government spending, increased healthcare capital investments and finally reduce the tax burden on the society in the long run.


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