By Rich Bowden:

The Victorian and NSW premiers have agreed to back the Commonwealth health care reform package after another day of tight negotiations in Canberra. The announcement leaves WA as the sole state holding out against the deal.

NSW Premier Kristina Keneally announced she will back Prime Minister Kevin Rudd’s health reform saying her back flip was due in part to “protect her [state's] budget position.”

Victorian Premier John Brumby, who has led the opposition to the federal use of GST money for healthcare, also agreed to the package after Mr Rudd agreed to an additional $800 million for extra hospital beds, according to the Sydney Morning Herald.

Premier Keneally’s agreement to cede 30 percent of NSW’s GST funding to fund Mr Rudd’s contentious health reform plan will pressure Western Australia, the only state left opposing the reform.

Speaking on Sydney radio 2UE, Ms Keneally said she had gone to the premier’s meeting in Canberra with key demands for the state including guaranteed funding and “protection of the state’s budget position.”

However Mr Rudd still needs to win support from the West with Premier Colin Barnett still refusing to budge on GST.

“As far as I’m concerned Western Australia’s position won’t change,” he said. “We will not concede on the GST. That’s immovable as far as I’m concerned.”

However he appeared to hold out some hope of compromise earlier in the day when Mr Barnett said to reporters: “Everyone has given some ground here. And now Victoria and Western Australia are saying we will provide the money, exactly the same amount of dollars, but we will pay it directly into the pool.”

“It is within the Prime Minister’s grasp to achieve his health reform very quickly he will achieve everything he set out to do so long as he doesn’t try and retain one third of the GST,” he said.

The move from NSW and Victoria is seen as a major victory for Mr Rudd’s goal to transfer control of hospitals to the Commonwealth as the fulfillment of an election promise.

Tags: COAG, john brumby health, kevin rudd health, kristina keneally health