KEVIN RUDD said three years ago that the Commonwealth could take GST revenue from the states to fund its health plan, challenging claims by Victoria and Western Australia they have been ambushed by the Prime Minister.But the Victorian Premier, John Brumby, who yesterday categorically ruled out making any deal with Mr Rudd at the Council of Australian Governments meeting on Monday, said Mr Rudd had given a subsequent assurance not to touch GST money.Mr Brumby is leading the resistance to Mr Rudd’s plan, with his fundamental objections being the Commonwealth’s control over health and the proposal to withhold 30 per cent of GST revenue, rebadge it as federal money, and spend it directly on health and hospitals. ”[They] are two key reasons why Victoria will not and cannot support the Commonwealth proposal.”Mr Brumby told the National Press Club yesterday there had been ”no sign they would steal GST from the states”. ”That one just came out of the blue,” he said.But in August 2007, when Mr Rudd, as Opposition leader, launched his policy, it said money the Commonwealth gave to the states to spend on health would be clawed back.It said increased Commonwealth funding for all public hospitals ”would require a parallel reduction in Commonwealth outlays to the states and territories at the point of transfer”.”There would therefore be no windfall gain of any description to the states and territories.”Mr Brumby said yesterday he was unaware of this. His office later furnished a transcript of remarks by Mr Rudd and Wayne Swan during the election campaign when they said they would not ”reassess the GST formula in terms of the distribution between the states”.The NSW Premier, Kristina Keneally, has also expressed concern about losing GST revenue but yesterday, after meeting Mr Rudd, was pushing for a deal on Monday. She has called a special meeting of her cabinet for Friday.Tasmania is also on board but a briefing paper by its treasury, obtained by the Herald, urges caution in allowing the Commonwealth to claw back GST, which under the 1999 Intergovernmental Agreement, was to be allocated entirely to the states.”Once the [agreement] has been breached and the GST arrangements overturned for this particular reform, the Commonwealth may see accessing the GST to be the solution to fund other Commonwealth priorities,” it says. It warns the states are setting ”a very significant precedent”.Mr Rudd has promised the states $3 billion in inducements if they sign up to his plan. The money would be injected primarily into aged care, elective surgery, emergency departments and primary care.But Mr Brumby said Mr Rudd should hand over the extra money anyway. ”To deny that funding does not punish premiers, it punishes patients.”Mr Rudd said to do so ”just means more business as usual and [this] means the same old hospital system with the same old problems”.