Little more than a week after its second budget, the Abbott government has made its first strategic retreat by abandoning a plan to increase charges for subsidised medicines.

The backdown will blow a $1 billion hole in the budget. 

Speaking to reporters in Melbourne on Thursday, Health Minister Sussan Ley acknowledged the proposal to increase the amount patients must spend on drugs before qualifying for relief under the Pharmaceutical Benefits Scheme safety net would not pass the Senate.

The proposal is part of a bill that would also increase the patient contribution for PBS drugs by $5 a script for general patients, and by 80¢ a script for concessional patients.

"That measure is not going to pass the Parliament," Ms Ley said.

For more details, go to: http://www.theage.com.au/federal-politics/political-news/health-minister-sussan-leys-retreat-on-higher-medicine-charges-to-put-1b-hole-in-budget-20150521-gh6gpz.html?eid=email:nnn-13omn653-ret_newsl-membereng:nnn-04/11/2013-news_pm-dom-news-nnn-age-u&campaign_code=13INO007&et_bid=23509652&promote_channel=edmail&mbnr=NDk5MDMw