Legislative Assembly for the ACT: 2005 Week 06 Hansard (Friday, 6 May 2005) . . Page.. 1953 ..
from a low-risk agency to a high-risk agency. I obviously am interested in knowing why one approach is favoured over another.
Subject to hearing some elaboration from the Treasurer on these particular questions, we are pleased to support the government’s moves to improve the effectiveness of the insurance authority and will broadly support the promotion of best practice risk management in the territory.
DR FOSKEY (Molonglo) (10.31): I support the Insurance Authority Bill. It appears to be quite straightforward, noting that the scrutiny committee had no comment to make in its report of 4 April. As I understand it, the bill allows for the ACT Insurance Authority to be more aligned within Treasury, similar to the central financing unit and the superannuation unit.
The bill is also beneficial in that it gives the insurance authority greater ability to request up-to-date reports on claims from ACT government departments and agencies. That appears to have been an issue for the authority and may have contributed to major blowouts until now.
However, once the bill is enacted, the structure of the insurance authority’s board will change considerably, moving from a six-member governing board to a two-member advisory board. While I accept that the responsibility of the authority will now lie wholly within Treasury, I am concerned as to why the board should be reduced to only two members.
Another item of major interest to the Greens is the nature of the insurance authority’s clients. The authority’s 2003-04 annual report notes that the authority insures all ACT government agencies but has no external clients. However, the bill before us demonstrates, under clause 11, the ability for the authority to indemnify a third party that is not of the ACT government if there is some risk to government.
The Greens see this as an opportunity for the ACT government to provide insurance to community organisations, as currently occurs under the Victorian government. Community organisations operate on limited funding and are subject to the rise and fall of private insurance costs, which can significantly eat into their financial resources. Community organisations such as ACTCOSS have commented that, although insurance costs are stable for the time being, this is an important and complicated ongoing issue for the sector that needs to be addressed to ensure the sustainability of our community organisations.
Some community organisations have requested an increase in government funding over time, just in order to meet rising insurance premiums. However, the government has not heeded such requests. The government has previously offered community organisations the use of a government insurance broker to assist in finding cheaper insurance deals. However, some deals this broker found were actually more expensive. As the ACT community organisation sector is small, any chance of making cost savings through bulk purchasing of insurance is negligible and, due to the insurance categories some community organisations are placed in, which they have little control over, they face greater insurance premiums than they would like.