Brumby won't agree to 'wrong deal'

Shadow treasurer Joe Hockey says Victorian Premier John Brumby is Mr Hockey said "is proving to be a man of courage" by resisting the prime minister's plans for health reform, after expressing serious doubts over the PM's plans.

Brumby has said he's a 'great believer in federalism' and hopeful of reaching agreement with Canberra in the debate over hospital funding reform - but he won't sign up to a deal that won't work for Victoria.

Brumby hit out at critics of his opposition to Prime Minister Kevin Rudd's proposals to increase federal funding of hospitals in return for a share of the states GST revenue, and denied he was playing the role of wrecker before next week's vital COAG meeting.

He said the Victorian government was interested in genuine reform and had a record in putting forward reform proposals.

"But we are not going to agree to the wrong deal," he said.

Coalition keep up 'funding hole' attack

Meanwhile, the Federal Opposition is continuing it's line of attack, saying the government is hiding its proposals for tax reform and for health reform, according to Joe Hockey.

"The government has an $18 billion hole in its health program and it's refusing to release a review that will explain to Australians how they will end up, under Kevin Rudd, paying higher

taxes and perhaps even new taxes.

"Kevin Rudd cannot continue to play this game with the Australian people of not coming clean on what taxes he's going to increase and when."

But he declined to answer questions from reporters on Wednesday about coalition support for proposals for increased taxes on tobacco products, saying tax questions need to be seen within the context of Treasury Secretary Ken Henry's review of the Australian taxation system.

"Now is the time for the government to release the Henry Review," Mr Hockey said in Brisbane.

Victorian success sees Brumby stand firm

Victoria is considered by many to have one of the most successful hospital systems, and while other Labor premiers appear to be leaning towards agreement with the PM, Brumby is standing firmer, along with Western Australia's Liberal leadership.

Brumby said he agreed with the proposal to have local governance of hospitals - something Victoria had pioneered - and that performance reporting should be transparent.

Mr Brumby said all the advice he had received from a variety of health experts, as well as his own health department, was not to sign on to the federal government's plan.

"Anyone who tries to put us in sort of negative territory is being dishonest with the facts," he said.

"In fact, they couldn't be further from the truth.

"We have been in the business always at COAG of getting good, sensible long-term reform but we are not going to be bullied into a position that is wrong for patients and wrong for Australia."

"At the end of the day we have to make sure that the plan that we agree at COAG (Council of Australian Governments) is the right plan," he said in an address to the National Press Club in Canberra on Wednesday.

"It's got to be the right plan for Victoria and it's got to be the right plan for Australia."

Brumby: I want agreement, but PM's funding won't work for us

"I hope that we can reach agreement," he said, adding that he had always been a "great believer in cooperative federalism".

Brumby's assertion comes after the PM said Australians are sick of hearing excuses about delays in reforming the nation's healthcare system.

The Prime Minister says failure to reach agreement at next week's meeting would be bad for doctors, patients and families.

But Brumby hit out at the fiscal arrangements, saying he had "serious issues" with the funding set up proposed.

"In essence, the commonwealth is proposing to pay for its increased contribution towards hospitals by taking states and territories' GST revenue, taking it up to Canberra, recycling it and bringing it back with Canberra label on it," Mr Brumby said.