Strong stand on scrutiny shows PM's mettle

JULIA Gillard appears to have succeeded in transplanting the transparency-first approach she brought to the nation's schools to its struggling public hospitals.

After a long meeting with state and territory leaders, the Prime Minister emerged last night with a deal to invest $16.4 billion in the nation's public hospitals over the next decade in exchange for much greater scrutiny of the relative performance of hospitals and health systems.

Just as parents can examine the relative performance of schools, in the future states will be found out if they cannot run hospitals properly. The public will be able to hold them accountable.

Despite the push by the premiers to resist transparency, Gillard was right to stick to her guns.

On the face of it, she appears to have rescued Labor's reform push, which became bogged down after some states resisted Kevin Rudd's earlier reform proposals.

In Gillard's "year of decision and delivery", failing to win agreement for national health reform was not an option.

After all, it is now more than three years since Labor promised to "end the blame game" between the federal government and the states over health services.

Had Labor gone to the next federal election with nothing to show on health, voters would have been entitled to see the Prime Minister as a dud and a fraud.

This political reality explains why Gillard has been so intent on accommodating the state and territory leaders on health reform.

However, she proved her mettle by refusing to cave in to pressure to win a deal at all costs. In short, she did not allow the premiers to treat her as a sucker.

Her bottom line was simple -- there would be no more money without reform. And it worked.