Fed: Walkout by premiers at COAG = 2

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Fed: Walkout by premiers at COAG = 2

"The fact is we are forced to sign this health care agreement with a bayonet thrustin our backs," Mr Carr said.

The states had asked Mr Howard to extend existing funding arrangements, which run outon Sunday, for another 12 months to allow reforms to the health system to be debated.

Options suggested by the states included a national strategy for elective medicine,allowing GPs to set up shop in public hospital emergency departments, and more nursinghome beds.

Mr Howard also rejected a second request to extend the current health agreement for three months.

The states have demanded a 27 per cent increase in health funding but the federal governmentis only offering a boost of 17 per cent, or $10 billion, over the life of the agreement.

South Australian Premier Mike Rann also accused the federal government of attemptingto blackmail the states into the new health care agreement.

"This federal government is committed to trying to ringbark Medicare," he said.

"(We have been) blackmailed into a choice between less or even less."

Queensland Premier Peter Beattie said the agreement would put an extra 61,000 peopleon public hospital waiting lists, and he threatened to write to every one of them pointingout the blame lay with the commonwealth.

Before the walkout, the states had agreed to a plan to save the nation's rivers.

In a $500 million deal, the states and territories have agreed on a framework thatwill effectively give water the same legal right as land.

This has been a long term demand from farmers and environmentalists who believe sucha move will safeguard farming communities and the nation's waterways.

The states will pick up 60 per cent of the total cost in a plan that will pump moneyinto safeguarding the Murray River.

Former National Party leader Ian Sinclair is likely to head the carve-up and implementationof the plan.

Under the deal, the commonwealth will contribute $200 million to the five-year package.

NSW and Victoria will contribute $115 million each, South Australia $65 million andthe ACT $5 million.

AAP kmh/sb/ldj

KEYWORD: COAG WALKOUT SECOND LEAD 2 CANBERRA