Legislative Assembly for the ACT: 2002 Week 7 Hansard (6 June) . . Page.. 2073 ..
MR HUMPHRIES (continuing):
We are by no means at the end of the road when it comes to providing relief. This is only the first step, not the last. But the step that is taken I welcome, because it provides means for community organisations to spend to more of their own money on the things that matter, such as the services they provide.
MS TUCKER (6.10): This bill is a response to concern from the community about the growing cost of public liability insurance for community and sporting groups. This bill allows the minister to make guidelines to exempt particular groups from duty on public liability insurance premiums.
There is certainly a crisis in public liability insurance at the moment. Some community groups are having to cancel events because they cannot find adequate public liability insurance. Other groups engaged in low-risk activities and with no history of claims are facing steep hikes in the cost of public liability insurance. Duty exemption is already provided to charitable organisations for some types of insurance, but there are many other not-for-profit community groups that would benefit from the exemption.
State and federal governments are making joint efforts to examine the public liability insurance issue, but it is good that the ACT government is taking its own initiative that will provide some assistance to local community groups. It will also stop the government from making a windfall gain on duty from increased premiums, which would be very unfair to community groups, which do not have much money to spare.
I do not think this bill is a total solution to the problem, but it will help. I am therefore happy to support the bill. Ms Dundas has amendments which I will respond to in the detail stage.
MS DUNDAS (6.12): Unlike other members of this Assembly, I do have a lot to say on this bill. There has been a great deal of discussion about the impact of escalating public liability insurance premiums on all the non-profit organisations that perform so many essential functions in our community. For this reason, I commend the government on its initiative to extend the scope of existing duty exemptions on insurance premiums.
It is essential that governments find a sustainable solution to the broad problem of escalating premiums, but in the short term an exemption from duty payments will take some pressure off non-profit organisations. Duties on insurance premiums currently amount to about 11 per cent of total cost. For organisations currently under severe cost pressure, this could make a significant difference to their viability.
Although I support the objective of the government bill, it could be substantially improved in three areas: firstly, by making the duty exemption effective for many groups from the date the bill comes into force; secondly, by making it clear that exemptions for sporting organisations only go to those organisations that have little sponsorship or other commercial revenue; and thirdly, by making the minister more accountable to this Assembly for his decisions to grant exemptions.
As the Duties Act stands, community organisations are already exempted from duty. The definition of community organisations is quite broad, and I believe that many organisations currently paying duty on premiums are unaware that they are entitled to an