Legislative Assembly for the ACT: 2005 Week 05 Hansard (Thursday, 7 April 2005) . . Page.. 1548 ..
emergency reinsurance fund that comes into operation only in the event of a terrorist attack. Its effect is that insurance cover will continue to be provided and that premiums will be contained to reasonable levels. Accordingly, the opposition supports this bill.
I must point out that this measure is necessary only because the reinsurance industry has declined to cover acts of terrorism. I acknowledge, of course, that covering acts of terrorism is not risk free, but I do believe that the refusal of the reinsurance industry to underwrite the ACT workers compensation scheme does reflect a level of disinterest in the territory, and a culture of palming off risk to someone else whenever possible. I have had discussions with the Treasurer informally over some of the difficulties facing industry and individual consumers in the ACT when dealing with the insurance industry, because too often I get the impression that the moral is “socialise your losses and pocket all the gains”.
Going back to first principles, the whole concept of insurance is to spread and share the risks. I am grateful to the minister and her office for working cooperatively with my office and briefing me on this matter. I am disappointed, after six months in this Assembly, that the Insurance Council of Australia is yet to cross the doorstep of my office. I really think that there is scope for us to look more closely at other issues relating to insurance in the territory on another occasion, as I have many examples of, and have had personal experience with, the approach of that industry, which I think is less than satisfactory in terms of consumer expectations and business expectations. I certainly will be looking to bring some suggestions forward to my colleagues and also to the government to consider on another occasion.
The matter before the Assembly is the Workers Compensation Amendment Bill 2005. It makes sense to implement these changes. They are designed to protect the interests of employees in the territory and to prevent businesses facing unreasonable hikes in premiums and, therefore, we are pleased to support the government in this initiative.
DR FOSKEY (Molonglo) (4.20): The ACT Greens support the Workers Compensation Amendment Bill 2005. After the attacks on the World Trade Centre and the Pentagon in the United States in 2001, reinsurers withdrew their coverage in respect of acts of terrorism and, without reinsurance, insurance companies are not prepared to cover events that may result in such sizeable payouts.
Although on past evidence terrorist acts are a small risk in the ACT, there is, nonetheless, that potential. This legislation expires next year and I understand the urgency of passing this bill today. However, as I have noted during past debates when legislation has passed through the Assembly within a week, this is not ideal.
In 2002 the ACT Greens accepted that it was incumbent on the ACT government to take temporary responsibility for this insurance. It is disappointing that the reality is that three years later the government has to continue to provide this insurance. If workers compensation, like public liability and other essential insurance products, is to remain a primary function of business, we need to think carefully about how we manage it.
In 2002 the Greens argued the need for long-term solutions to be pursued at a national level, at the very least, in order to give the large international reinsurance companies greater confidence in the Australian system. I support the bill today, but I am interested