House of Assembly Fifty-Fourth Parliament, Second Session (54-2) 54 2 Parliament of South Australia House of Assembly published Bills Fair Trading (Motor Vehicle Insurers and Repairers) Amendment Bill Fair Trading (Motor Vehicle Insurers and Repairers) Amendment Bill Fair Trading (Motor Vehicle Insurers and Repairers) Amendment Bill Final Stages Final Stages Consideration in committee of the Legislative Council's amendments. The Hon. D.C. VAN HOLST PELLEKAAN House of Assembly The Hon. D.C. VAN HOLST PELLEKAAN: Acting Chair, I draw your attention to the state of the house. The Acting Chair House of Assembly Mr Pederick The ACTING CHAIR (Mr Pederick): Attention has been drawn to the state of the house. There not being a quorum, ring the bells. A quorum having been formed: The Acting Chair House of Assembly Mr Pederick The ACTING CHAIR (Mr Pederick): Member for Waite, do you wish to make any comment on amendment No. 1? Mr DULUK House of Assembly Mr DULUK: No, sir. The Hon. S.C. MULLIGHAN House of Assembly The Hon. S.C. MULLIGHAN: I would like to make a brief contribution, thank you, sir. This bill was conceived as a result of work done by the Economic and Finance Committee. The member for Waite introduced this bill to this house. It has been upstairs and returned with these amendments. Some of the original intent of the bill has been maintained but, unfortunately, not all of it. As we saw in the discussion we had on this bill in this place, the government has watered down this bill to the greatest extent possible. Let me remind those who might not be following this as closely as some others, this bill was designed to ensure that people who have a motor vehicle insurance policy, who might need the services of a South Australian motor vehicle repairer, were better protected under consumer law here in South Australia. The Liberal government has done its level best to water down the provisions that the member for Waite and the members of the Economic and Finance Committee, who participated in this review, recommended to the parliament. I want to place on record that I am particularly disappointed with some of the representations that I and other members of parliament have received from some of the stakeholders, in particular the completely bogus claims that were put by some members of the insurance industry who quite frankly should know better. I will be particular about this: one of the recommendations from the committee would require that on the front page of a notice of offer from an insurer to somebody wanting to take out a comprehensive motor vehicle insurance policy, or on a renewal notice for one of those policies, the insurer would have to make a very simple, very brief declaration on that front page about whether that policy offered the policyholder, the motor vehicle owner, choice of repairer—very straightforward and completely in the interests of consumers. Members who were involved in the committee—the member for Waite and I, the member for Enfield, the member for Wright and others—all thought that this would be an absolute no-brainer because even South Australia's proud motor vehicle insurer, the Royal Automobile Association (the RAA) offer choice of repairer in their policies. So you can imagine my bewilderment when I received representations from the government relations officer of the RAA saying that requiring this—parliament imposing this requirement—meant that the RAA's actuaries would have to recommend an increase in premiums to motor vehicle policyholders. What rubbish, what absolute rubbish! Of course, when I asked that representative of the RAA to provide information to me as a member of parliament having to consider the amendments that were coming back from downstairs, 'What sort of impost would this cause to motorists?' the response was, 'It doesn't matter anymore. It is all done. It is all par for the course. We don't need to worry about that.' I have to say, I expected better behaviour from the RAA than this. They are at a clear market advantage in this state and for good reason—because they are a better corporate citizen than other insurers, they provide choice of repairer and they provide their signage and affirmation for South Australian family-owned small businesses that are motor vehicle repairers saying that they are RAA-approved repairers. That is all really good. That is all something we should support. So I cannot understand why they would not take advantage of a bill and a piece of proposed legislation within that bill that would make it absolutely clear to all and sundry that the RAA is the sort of insurer you want to be with as a motorist, that they offer choice of repairer. Instead, unfortunately, the representations we got saw effectively the RAA's lot cast in with the other insurers who do not offer choice of repairer, the other insurers based in other parts of Australia and overseas. Those are the insurers—not the RAA—who have sought time and time again to do over South Australian family-owned small business motor vehicle repairers and the South Australians who hold their policies, and that is what we were aiming to fix up. I am not going to stand in the way of these amendments. The member for Waite is leaving this situation better than it was without this bill. The complaint I make is that it could have been even better than that had the Liberal government and Liberal MPs not stood in the way of consumers and holders of motor vehicle policies getting a better deal, more transparency, and also the hundreds of South Australian small businesses—those locally owned motor vehicle crash repairers—not being done over by greedy, corporate insurance companies based overseas and interstate. But that is how Liberal members of parliament think our laws should be drawn. It is clear that they have the majority here. I thought that not only were we on the side of consumers but we could stand lock step on the side of the RAA in making it clear that they are a better type of insurer than those other people out in the market. Unfortunately, I have been proven wrong. The Hon. J.B. TEAGUE House of Assembly The Hon. J.B. TEAGUE: Can I just indicate that the government will be supporting the amendments and will be pleased to step through those in an orderly way. I indicate that it may be appropriate to step through them in due course. Amendments Nos. 1 to 7 and 10 to 13 of the Treasurer, and Amendment No. 1 [Bourke-1] and Amendment No. 1 [Bourke-2] in the other place might be capable of being dealt with en bloc. I am very conscious of the mover and if there are any necessary contributions to be made in relation to those, or other observations to be made about where we have got to in terms of amendments in the other place, then I am in the house's hands. The Acting Chair House of Assembly Mr Pederick The ACTING CHAIR (Mr Pederick): Minister, just to help me, how many amendments do you want to move en bloc? Mr DULUK House of Assembly Mr DULUK: I suggest that we accept all amendments en bloc, so I move: That the Legislative Council's amendments be agreed to. The Acting Chair House of Assembly Mr Pederick The ACTING CHAIR (Mr Pederick): It has been moved by the member for Waite that all 12 amendments be agreed to. The member for Lee can make a contribution. The Hon. S.C. MULLIGHAN House of Assembly The Hon. S.C. MULLIGHAN: I am not going to stand in the way of that, but there was one other comment that I did want to make, and it was about the penalty provisions. I indicate that we will be supporting the member for Waite in moving these amendments en bloc. Aside from that declaration on the front page of the motor vehicle insurance policy was the initial desire of this bill to substantially increase the penalty provisions for noncompliance with the new code of conduct. The government sought to water that down. I just want to walk you through the following scenario, sir, because it is one that might appeal to your heart in particular. Imagine you are driving along on a country road in a large vehicle like a Toyota LandCruiser and some T-rex size marsupial jumps out in front of your vehicle, sir, and you are unable to either— An honourable member House of Assembly An honourable member: And shoot it. The Acting Chair House of Assembly Mr Pederick The ACTING CHAIR (Mr Pederick): Order! The Hon. S.C. MULLIGHAN House of Assembly The Hon. S.C. MULLIGHAN: —shoot it, as one of the members opposite suggests or perhaps, more to the point, avoid it, and you come a cropper running into— The Acting Chair House of Assembly Mr Pederick The ACTING CHAIR (Mr Pederick): Member for Lee, just as a good bit of advice to everyone, it is not a good idea to dodge a kangaroo because you may roll and either injure yourself severely or die. But I will hand it back to you in this running commentary because it does have a minor personal connection to me. The Hon. S.C. MULLIGHAN House of Assembly The Hon. S.C. MULLIGHAN: Somebody with less dust on their boots than you, sir, is certainly me, so I take that advice gratefully. Let's say you are about to slam your 200 series LandCruiser into this T-rex size marsupial, sir— Mr Whetstone House of Assembly Mr Whetstone: Or even a 300. The Hon. S.C. MULLIGHAN House of Assembly The Hon. S.C. MULLIGHAN: —or even a 300; yes, that's right, the market is changing now—and that vehicle has to go in for extensive repairs. It would not be uncommon in such a significant front-end collision for the cost of those repairs to well exceed $30,000, $40,000, $50,000 and then in particular, particularly with the 300 series LandCruiser the member for Chaffey makes reference to, there are all sorts of embedded safety systems in that car. If an insurer places pressure on the motor vehicle repairer to cut the cost of that repair so that it is not done properly despite its extensive cost, that there is not enough time allocated to calibrate those necessary safety systems, sir, next time you are out driving, servicing your electorate in that vehicle, you may not be as safe as you should be in a properly repaired vehicle. The reason why it was initially sought to increase the penalty provisions up to I think it was $100,000 in the original bill was to reflect the real risk to a consumer like you, sir, of having an expensive vehicle that might have extensive damage that needs to be repaired thoroughly and properly. The existing penalty provisions do not adequately reflect the real figures and the real risk that poor quality repairs might have. I realise this has all been organised now between a majority of members to get those through and, as I said, I am not going to stand in the way of that, but I do want to place on the record that there was a real reason the penalty provisions were proposed to be increased. It is regrettable that they are not, but perhaps that is something that will have to be fixed up at some point after the next election. The Hon. J.B. TEAGUE House of Assembly The Hon. J.B. TEAGUE: I will be very brief about this point, and indicate that, for consistency with existing industry codes under the Fair Trading Act, the government maintains a view that the civil penalty of $50,000 for body corporates and $10,000 for individuals is most appropriate. The member for Lee's contribution just now reminds me of some of the jibes in a previous set of circumstances involving capacity to open doors and things in car parks. I would hate to be in a situation where the member for Lee's circumstances were such that damage arising might require him to rely on these matters. Otherwise, I am glad to get an indication that we might be coming in to land at a suitable point on this score as well. Motion carried.