Senate Chamber
9th December 2002 Senator CHAPMAN (South Australia) (3.22 pm) - We see again this pathetic opposition coming into this chamber trying to beat up an issue where absolutely no issue exists, because the Minister for Revenue and Assistant Treasurer, Senator Coonan, has shown strong leadership with regard to dealing with the issue of public liability insurance. Indeed, on 15 November the minister met for the fourth time with relevant state and territory ministers as well as with a representative of the Australian Local Government Association to discuss public liability insurance. As a result of those meetings, there is agreement between all levels of government on the need for the introduction of measures aimed at reducing and containing claims costs and improving the affordability and availability of public liability insurance. This follows the historic in principle agreement reached at their previous meeting to move to a nationally consistent law of negligence. At that meeting on 15 November, the ministers agreed to a package of reforms implementing key recommendations of the review of the law of negligence: the so-called Ipp report, to which Senator Ludwig referred in his remarks. The government has taken leadership, brought the states together and achieved an agreement on a package of reforms. The governments have agreed that the key Ipp recommendations that go to establishing liability should be implemented on a nationally consistent basis. The suggestion that the states and territories will not introduce uniform legislation is false. Each jurisdiction has agreed to introduce legislation on a nationally consistent basis as a matter of high priority. Each of the states and territories recognises the importance of consistent legislation to ensure that the common law does not diverge over time. At that meeting it was further agreed that a system of thresholds or scales for general damages coupled with restrictions on legal costs is an imperative; it is noted that most states are moving in this direction. The minister also confirmed that the federal government would amend the Trade Practices Act to support reforms that were nationally consistent, and they agreed in principle to amend areas of inconsistency. Ministers agreed that the national package should have a significant impact on alleviating the public liability crisis and reinform insurers of the importance of quickly and fully passing on the benefits of reform to consumers. An actuarial assessment of the economic impact of national reforms to negligence law on the affordability and availability of public liability insurance was also presented to ministers at that meeting on 15 November. The assessment noted that, if key quantifiable elements of the review of the law of negligence were implemented, an initial reduction in public liability premiums of 13½ per cent could be expected-a significant achievement. The assessment also suggested that the behavioural effects of adopting the suite of recommendations on the definitions of `negligence' and `duty of care' and other Ipp recommendations on liability reform should result in significantly larger savings over time. The actuarial report was supported by industry representatives present at the meeting. The representatives assured ministers from the states and the Commonwealth that adoption of the Ipp recommendations will increase the availability of public liability insurance, particularly in the community sector, and bring certainty and stability to pricing. They agreed with the findings of the PricewaterhouseCoopers report that the reduction in claims costs due to the Ipp reforms will flow through to reduce premiums by an estimated 13½ per cent. At that meeting, ministers also agreed to consider in detail the merits of proportionate liability and professional standards legislation as a means of addressing problems surrounding professional indemnity insurance. There was strong agreement on proportionate liability for economic loss, with some jurisdictions committed to implementing legislation and others close to finalising their position. All of that has been achieved as a result of the four meetings that Senator Coonan initiated with representatives of the states and territories. The achievements to date and the forward work plan were therefore put to the meeting of the Council of Australian Governments for endorsement. That was achieved last Friday. (Time expired) |
