Page 3361 - Week 08 - Thursday, 23 August 2012
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downward pressure on premiums. Indeed, it is not the case that the 2008 reforms have failed or have had no impact. That is not why we have brought these current reforms before the Assembly. The benefits of the proposed reforms include the potential for competition in the market as well as curtailing claim cost inflation.
Importantly, our current amendment addresses a technical deficiency in the 2008 legislation. The 2008 reforms were intended to cap the maximum legal fees payable for small claims, which are claims less than $50,000, excluding pain and suffering. There is, however, a drafting loophole in the CTP law in this respect. Clause 17 of the government bill would correct this issue by making the exclusion of pain and suffering explicit and securing the original intent to encourage people with minor injuries to pursue early intervention, treatment and rehabilitation. In the absence of this particular change, it appears that any gains from the 2008 reforms would be quickly undone, and this would place immediate and upward pressure on premiums of somewhere between $25 and $40 per annum. This would amount to a further premium increase of between 4.8 and 7.6 per cent, in addition to the recent 10 per cent increase.
The government stands by CTP reform. The benefits of the reforms are for all the households in the territory. The benefits of the reforms are for those unfortunate enough to be in an accident, by focusing on early rehabilitation and the speedy resolution of CTP claims. There is no doubt that, in the context of seeking to eliminate economic rent and undertake the sort of microeconomic reform that is necessary in this country, it requires hard work and hard yards. There are always those who will take the cheap and easy option. It is always easy—
Mr Doszpot interjecting—
MR ASSISTANT SPEAKER (Mr Hargreaves): Mr Doszpot, we have got a list started; let’s not add to it.
MR BARR: It is always easy to squib on an important reform. But this problem will not go away. Unless we address it, it will just grow and grow, and the sort of remedial action that will be necessary for some future parliament will be even more significant. The one thing I know with absolute certainty is that, if we do not deal with this now, someone else will have to deal with it later, and the problem will be worse and the challenges that confront legislators will be even more significant. That is the challenge for all members: when we go to the detail stage later in this sitting of the Assembly, who will have some courage for real reform? We will see that tested.
Question resolved in the affirmative.
Bill agreed to in principle.
Detail stage
Clause 1.
Debate (on motion by Mr Barr) adjourned to the next sitting.
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