Because of the breadth and complexity of the Terms of Reference this report needs to be read in its entirety as most of the issues and recommendations interrelate. This also will explain why some areas will appear repetitive.

We have concluded that many of the issues affecting recruitment and retention of the medical workforce in Victoria have been identified in the past, and are not specific to Victoria.

The considered opinion of the Panel is that the public health system in Victoria is under significant stress with low staff morale. Senior medical staff are disillusioned with the public hospital system, which they believe places greater emphasis on throughput and budget accountability than on quality of care and outcome. They feel that their views are rarely taken into account in decision-making relevant to their work.

The Panel has been unable to find other than isolated anecdotal evidence that the relative remuneration packages offered in the various Australian jurisdictions are playing any significant part in the capacity or success of Victorian public health services in recruiting and retaining medical staff. However, accurate interstate salary comparisons are inordinately difficult for both employers and employees to make. In contrast with other States, senior doctors employed by Victorian public hospitals and health services typically enjoy considerable flexibility in the negotiation of salaries and conditions.

Consequently, we believe that the greater risk is not that senior medical staff will relocate to other states but that they will withdraw from or reduce their commitment to the public sector in favour of the private sector. It has always been accepted that earning capacity will be higher in the private sector, but as many of the factors that have traditionally attracted specialists to public hospitals such as teaching, complexity of patient problems and clinical meetings become available in private hospitals, the incentives to remain in the public sector will decrease.

Many different issues need to be addressed to overcome low morale and disillusionment, the most important being to demonstrably value the work, commitment and opinions of clinical staff. It is vital that such steps are taken expeditiously; otherwise patient safety, health care quality, staff recruitment and retention will continue to be adversely affected. It is imperative that managers and Boards recognise that their primary responsibility is to use the resources that are available to create an environment in which clinicians can best do their job in order to provide best care for patients.