Bills

Motor Vehicles (Compulsory Third Party Insurance) Amendment Bill

Second Reading

Adjourned debate on second reading.

(Continued from 2 April 2019.)

The Hon. R.I. LUCAS (Treasurer) (11:02): I thank members for their contributions to the second reading debate. I understand there is an amendment in the committee stage, and we will address the government's position during the committee stage of the debate. We are happy to proceed to committee.

Bill read a second time.

Committee Stage

In committee.

Clauses 1 to 7 passed.

Clause 8.

The Hon. K.J. MAHER: I move:

Amendment No 1 [Maher–1]—

Page 4, line 31 [clause 8, inserted section 129A(2)]—Delete 'of a class approved by the Minister from time to time' and substitute 'of a prescribed class'

This amendment is moved to ensure that there is greater transparency around the regime of the Treasurer considering and approving inducements from insurers. Under the terms of the bill as introduced, clause 8 prohibits commissions and other financial benefits without ministerial approval. This is the first time that insurers have provided insurance in the market. There are also four insurers competing for business from 1 July 2019, each with a different market share. I understand these are: QBE with 35 per cent, Allianz with 15 per cent, AAMI with 30 per cent and SGIC with 20 per cent.

Whilst the Treasurer's advisers have informed the opposition that the approval of any commissions and inducements will be published, the bill does not specifically provide that publication is required, let alone how that might be published. The amendment removes the minister's discretion here and requires that commissions and inducements are to be approved by regulation or, as it technically reads in the drafting of the amendment, be of a prescribed class.

Essentially, commissions and inducements will be prescribed by regulation. In practice, it will be the minister who receives and recommends commissions and inducements to cabinet. Upon cabinet approval and consideration by the Governor, these regulations will lie on the table of the parliament for the required period before coming into effect. We think these are sensible amendments that actually give this chamber an opportunity to play a part in the process of making sure that everything is fair and above board because, once regulations are laid, members can have a good look at them.

This amendment would not see the regime becoming overly onerous or unwieldy, either for the government to make regulations or for the insurers to seek them. I am conscious of the desire of the government to move quickly in this area so that the terms of the CTP regime are settled and CTP bills can go out for the new financial year. The government may argue that this time frame does not allow for the regime of commissions and inducements to be considered and approved by cabinet and the Governor and laid before the parliament in time. In this first instance, coming to the commencement of full competition, the regulations can be made and approved with a certificate of early commencement.

This amendment provides greater regulatory transparency in the process. This transparency is important for two reasons. Firstly, it allows all insurers competing with each other for the first time in the South Australian market to understand what inducements are available to them to offer to consumers. This is important for competition. It would be unsatisfactory if one insurer had sought and received approval for commissions and inducements, had them approved by the minister and was able to start off with them exclusively.

Under the terms of the bill as it currently stands without this amendment, this is possible, particularly without the requirements of the minister's approval and the detail of what commissions and inducements have been approved to be published. This would be an unfair advantage over other insurers and would mean that there is less competition in the market for consumers, as an insurer would be able to gain an unfair advantage over its competitors by offering those commissions or inducements.

Secondly, the requirement that the commissions and inducements are able to be scrutinised by parliament is critical for public confidence in this new regime. We cannot have any government of any persuasion approving commissions and inducements that are out of step with community expectations or even threaten the viability of the insurer or the CTP market in SA. By giving the parliament a role, particularly by giving parliamentarians in the Legislative Council a role, that transparency is ensured. In this regard, parliament is an important watchdog that must be left to be able to guard against this behaviour.

The Hon. R.I. LUCAS: The government opposes the amendment. At the outset, I would just say that there is a touch of irony in relation to part of the argument for this particular amendment, that is, that it is so important that there be transparency and accountability by the parliament in relation to this process because, I remind the Leader of the Opposition and all members, this was actually a privatisation done by contractual arrangement without approval and accountability to the parliament. The whole deal that the former government did in relation to the privatisation of CTP insurance was done by contractual arrangement outside legislative change in the parliament.

So there is the irony of, at this stage of the debate, arguing passionately for transparency and accountability, when the whole basis of what we as a new government have inherited was, in essence, by contractual arrangement outside any parliamentary accountability at all. I put that to the side in relation to the argument about transparency and accountability.

In relation to the specifics of the amendment, I am indebted to Ms Kim Birch, who is the regulator and who has considerable experience in other jurisdictions, in Queensland in particular, in relation to managing these processes. That is not an experience I have had, and I suspect no other member has had, in relation to how you manage these sorts of processes, so I am indebted to her and her staff in terms of the advice they have provided, to not just me but to crossbench members and others, in terms of what are the various options and the implications of the options.

This is a system the new government has inherited. The offering of insurance had been privatised. We supported the notion the former government brought for independent regulation by an independent regulator and supported that particular legislation after the decision had been taken to privatise. We accept that, but we have nevertheless inherited it. One thing the former minister and government promised was that there would be multipolicy discounts and various other benefits in relation to private sector provision of compulsory third-party insurance, that is, consumers would benefit through a range of incentives or inducements—whatever word we wanted to use (multipolicy discounts was but one example)—in terms of the new privatised, competitive CTP market.

Where we have arrived at at the moment, and certainly the strong advice from the regulator—and to a large part the contracts that are currently being negotiated with the four CTP insurers and others, decisions that the independent regulator takes in terms of the ongoing discussions that have gone on and are continuing in relation to the issues—her experience has been, and the way this scheme has been structured, is to ban what the regulator saw in Queensland in terms of inducements that go directly to motor vehicle dealers. It was her very strong advice to the new government that those sorts of commissions and/or inducements were counterproductive in terms of consumer benefits, and the government has accepted that advice in relation to ensuring that that is not going to be possible and is not going to be the case.

So I think our regulator comes to the table with considerable experience in terms of looking after the consumers' interest, considerable experience in terms of managing these complicated schemes, and as minister and as a parliament we ought to give considerable weight to the advice she shares with us all in relation to these issues.

Her advice to me—and I know to individual members that she has briefed—is that these are not going to be hidden inducements, they will be published on the independent regulator's website. In relation to the contractual discussions that are going on, the regulator has advised me that each of the insurers have been made well aware of the fact that, in terms of the contractual arrangements, these particular inducements, if ultimately approved, will be published immediately on the independent regulator's website, so people will be aware of those.

However, it is a competitive market. The former government introduced competition: it is not going to be a monopoly provider, it is not going to impose the idea that everyone has to operate in exactly the same fashion in a competitive market. The former government adopted a position, which we are now implementing, where four private sector insurers will compete with each other for market share.

The Leader of the Opposition has highlighted recent figures in relation to market share, but the former government's vision was that those companies would be competing with each other and taking market share from each other through competition. The former government's vision was that that would be a good thing for consumers in South Australia because, through competition, it would help place downward pressure on prices. Downward pressure on costs would not just be competing with compulsory third-party insurance, because you cannot do that, it would be competing with the other benefits or inducements that might ultimately be approved through this particular process.

The final point I want to make is an important one, as someone who has lived through many, many years of disallowance motions in relation to regulations. As members would be aware, our procedures are such that, if a government brings down a particular regulation, any individual member of parliament has up to, I think, 14 sitting days—which is five sitting weeks, which could be, given the way we sit, three or four months, and if it is over the Christmas break or the midyear break, it could be four or five months—to move a disallowance motion.

So an individual member can delay for three, four or five months a motion to disallow. Then, of course, the individual member, having moved the disallowance motion or given notice, can leave that particular motion sitting on the Notice Paper for however long they wish before ultimately there is a decision for a vote.

Our convention, which I have always supported and will continue to support, is that it is up to the individual member to bring his or her private members' motion to a head. So, under our conventions, that disallowance motion can sit there for however long that individual member wishes. If it is ultimately voted upon, there is nothing that prevents the individual member, as we have seen on a number of occasions, to immediately move a further disallowance motion. In relation to fabled examples in the past, such as fishing regs, there may have been examples of up to three occasions when disallowance motions continued to be moved.

It is correct to say that, in some cases, it is a moot point because it can have legal effect immediately. It gets disallowed, and you then have to move through the process, potentially, again. However, in this competitive market, it makes no sense at all. If you are a major private sector insurer and you have a disallowance motion hanging over your head, even if it takes legal effect almost immediately you will not go through the process of putting in all your policies and bills, etc., and an inducement and implementing all the processes to implement that inducement knowing that there is some prospect that it might get disallowed a few months down the track and the parliament might then say that it does not support that particular proposition.

In terms of practicality in the market that the former government's vision outlined for us—and we are just implementing it—it really will make it impractical if we are going to go through this particular process. The other point I make about the former government's vision of a competitive market—and the regulator has advised the government and other members who have been briefed on it—is that private sector insurers need to be able to move and move relatively quickly; for example, if a competitor introduces some form of inducement, or for whatever other reason.

It may well be because the regulator, in a very new innovation, is going to have a sort of housekeeping seal of approval—a service standard is what it is called, I think—so individual consumers will be able to see, in essence, the customer performance rating of the individual insurers. So an individual consumer will be able to compare the price of one company. It might be cheaper than the other three, but if the customer performance ranking—whatever that is called—is appalling compared to the other three, as a consumer you might make a judgement the slightly lower price for a poorer performance record is not worth it and you will stick with the person or the company that is slightly higher priced that has a much better performance record in terms of customer service. That is more information that will be available in this particular competitive market.

If, for whatever reason, a company sees significant loss of customer share or market share, they are going to want to move, and relatively quickly. They may well decide they are going to have to offer a more significant discount in terms of comprehensive insurance or household insurance or whatever else it is. If it was customer performance, they might want to do something about their customer performance, but in relation to the inducement that they might be able to offer, they need to be able to react relatively quickly.

To have a notion where, through a regulatory system, it could be months and months before there was ultimately some determination would be counterintuitive to the sort of system the former government was envisaging—that is, a competitive market with private sector insurers competing with each other for market share to the benefit, ultimately, of consumers. That was the vision of the former government, that is what the former minister talked about and that is what we are seeking to implement to the best extent possible.

In conclusion, the very best advice that we as a parliament have from an independent regulator, who has had experience in the system and who is strongly advising me, the government and anyone else who is prepared to listen to the advice, is that we as a parliament should not support this particular amendment.

The Hon. C. BONAROS: I have indicated already in this place my concerns with the CTP scheme more generally and especially in the context of the dissenting report that I gave to this Social Development Committee inquiry. I will not go into those details, but in relation to this amendment, I would like to make a few points. The amendments were filed this week, so in the short time available I have been seeking advice from the Treasurer and the regulator with respect to their effect. The first thing to note is that the model proposed by the government already goes beyond any jurisdiction in that it codifies classes approved by the minister. That does not exist elsewhere, and the regulator has, as I understand, recommended that for good reason.

I will canvass a few of the points that the Treasurer has already spoken to, but the issues that have been highlighted to me are that putting the class into regulations affects both the competition model and the flexibility of how the regulator sees that operating. In effect, it would slow down the opportunities for communities to benefit from the inducements that are to be proposed and would dampen competition between competitors. The reason for that is that, generally, when these things are proposed, insurers want to assess what the market is doing and move very quickly to go out to market with any inducements. If this had to go through regulation, that process would be severely impacted and slowed down. That is the first issue.

Again, as I said, our jurisdiction is codifying the inducements insofar as the minister will have to approve the class, from time to time, that he is proposing. We already have built into the legislation an extra layer of protection, if you like, for the community. The types of inducements the Treasurer allows are going to be monitored by the regulator both in terms of their appropriateness and also, importantly, in terms of value for money. I think that is key. That is, in effect, the regulator's job in this regard.

The other thing to remember—and I think this is also a very important point—is that the minister can go away and come up with this prescribed class, but the regulator can then issue, as I understand it, rules around that class if required, so it is very clear to the insurers what they are and are not able to do, even within the class that has been approved by the Treasurer in this instance.

If there are unforeseen circumstances, however, or consequences, the current model will enable the regulator to immediately recommend to the Treasurer that the inducements either be pulled or be changed. That is not the case if they are dealt with by regulation, and I think that is a very important point that we need to take into consideration in the context of this amendment. That simply would not be the case for a whole host of reasons, which the Treasurer has already outlined, if we were dealing with these by way of regulations.

While I appreciate what the opposition is trying to achieve, my concern is—and I think the regulator has certainly put us at ease in terms of the impacts—that the amendment proposed would actually make the provisions unworkable and impractical to such an extent that it is just not an option that we ought to be considering.

The Hon. K.J. MAHER: I have a question for the Treasurer. I think the Hon. Connie Bonaros mentioned the tight time frames we are working with with this. What does the Treasurer say is the date that this has to be passed by, and why?

The Hon. R.I. LUCAS: I think the notice that went out to all members last week in terms of the priority order for the government was that we need to pass this through our house by 4 o'clock this afternoon. There is a drop-dead date in relation to what the regulator is doing, so we have to get it through this house this week. It then goes on the Notice Paper in the House of Assembly, officially this afternoon. They then debate it in their next sitting week, or two sitting weeks, to allow them time to consider it.

I think the drop-dead date is some time in May. We have to go through processes with cabinet and government, and the regulator has deadlines because there are processes with DPTI with their TRUMP system. I am sure the minister will be aware that there are other processes in relation to EzyReg or the forms that have to go out to people for renewals and those sorts of things. We have worked back from the regulator's deadline in terms of when the parliament needs to consider things by.

The Hon. K.J. MAHER: The Treasurer mentioned a drop-dead date. What exactly is the drop-dead date that he refers to?

The Hon. R.I. LUCAS: About the third or fourth week of May is the drop-dead date from the regulator in terms of what then needs to be done for a 1 July start-up process.

The Hon. K.J. MAHER: When did it become apparent that the drop-dead date was the third and fourth week of May? How long has the government, or the regulator for that matter, known that this is the date that it has to be completed by?

The Hon. R.I. LUCAS: It has been a little while. I cannot give you an exact date as to when we were first advised, but we have had to go through a cabinet process to get the bill to where we are. When we did that, we worked backwards on the basis of when we needed to get the cabinet submission in. You have to give notice for cabinet submissions. All those sorts of things have been working. I cannot give you an answer as to exactly when, but as we were doing the cabinet submission, we were working backwards from when we needed to give sufficient time to the Legislative Council to consider the bill, given that you do not want to walk it in and require a vote that week.

We have introduced the bill, given the requisite week for people to consider and to consult, and advised that we would like the bill considered by the end of this particular week, which is this afternoon. Then it can go down to the Assembly and go through their processes as well. If ultimately there were to be amendments that were successfully passed in the Legislative Council—which is what the Leader of the Opposition is proposing—we would potentially have to budget for the bill to go to the House of Assembly and, if the amendments were then rejected, to come back to the Legislative Council. If they were rejected again, they would go through a conference of managers process to meet the drop-dead date.

The Leader of the Opposition is aware of what can go on if amendments are moved successfully in terms of the passage of legislation between the houses. We are in a situation where we cannot afford to not be ready to implement the former government's vision of a competitive insurance market from 1 July.

The Hon. K.J. MAHER: If I can ask the Treasurer, this drop-dead date of the third or fourth week of May so that the scheme is operating by 1 July (I think the Treasurer said) where does this come from? This legislated provision about—

The Hon. R.I. LUCAS: 1 July? That is yours.

The Hon. K.J. MAHER: Where does it come from? Is it by legislation that has previously passed parliament?

The Hon. R.I. LUCAS: It was a policy of the former government—your government—that there would be this three-year transition period that expires on 30 June and the new competitive market that you envisaged would start on 1 July. So it is not a time line we have imposed; we inherited it and we are working toward it.

The Hon. K.J. MAHER: I think that is the exact point I am trying to make. This is not something that has crept up on a new government suddenly in the last few months, as the Treasurer now admits to the chamber. This is something that the government has known about since they first got into government more than a year ago. As the Hon. Connie Bonaros said, the time frames are quite short, even if it is one sitting week's notice, to then bring the vote on.

I think members and particularly crossbenchers who have to be across every bill that comes into this chamber are at a disadvantage when bills are only given a few weeks, particularly a bill that, on the Treasurer's own admission, there is no reason it could not have been introduced a year ago on the government's very first sitting day. They knew this was the date that was coming up, yet have waited until what is, as the Treasurer admitted, as tight a time frame as possible to keep within conventions. That puts pressure on both the opposition and on crossbenchers, who cannot necessarily properly consider the bill, let alone amendments.

The Treasurer has been here for something like 40 years, and I acknowledge that he is a very cunning politician and works very cleverly at how he does stuff. For something that he admits he has known has been in place since they got into government a whole year ago to be put into a time frame that is as short as possible to give people as little as possible time to consider it I think does not pay the respect that is deserved, not just to this chamber but particularly to crossbenchers. Why was this not introduced some time last year? Why did it wait until, as the Treasurer has admitted, the shortest time frame as possible to abide by conventions?

The Hon. R.I. LUCAS: I am not going to revisit a long debate about transparency and accountability, but the irony of the Leader of the Opposition arguing about giving short time lines to parliament—at least we are debating it in the parliament. The former government did not even bring the privatisation to the parliament. Give me a break. Do not talk about this new government abusing the processes of parliament by trying to shorten the debate times. At least we are having a debate. Anyway, put that to the side; it is an unnecessary and unhealthy diversion.

The notion that the new government, having been elected in March last year—and we all knew that the competitive process had to start from 1 July—could have introduced the bill straight away is foolishness in the extreme. Of course everyone knew, because the former government introduced the legislation, that the competitive market was starting on 1 July, but there is a considerable amount of work that the regulator had to do. To be honest, there was a considerable amount of work, as the new Treasurer, that I had to do to try to work out exactly what the former government had agreed to.

In some of the contracts in unrelated areas, having gone through the contracts after a period of months, we found all sorts of provisions within them that we were not aware of. That is the land services contract and others, but I will not divert to those areas. The new government had to have the opportunity to be properly advised by the regulator, by Treasury and others as to what the former government had actually agreed to.

There has been considerable discussion with the industry and with the regulator about the whole issue of commissions and multipolicy discounts. It is fair to say there have been varying views as to whether or not we should actually do what we are currently doing and that is offer multipolicy discounts. There have been varying views that have been put. Industry groups have put varying views, both to the regulator and to the government, in relation to what the appropriate response is.

There has been an ongoing debate about whether or not we should, as we are doing in this, ban commissions with motor vehicle dealers. There were industry people who were saying that is unfair because it gives a competitive advantage to a couple of the insurers and that the way their business model is structured gives them an advantage over a couple of the other insurers. So there has been a competitive market during this particular process in terms of the discussions with the regulator, discussions with Treasury and discussions with me as Treasurer.

This is not a 'slam dunk, here is the bill, just introduce it' situation. It was not there when we arrived in government: 'Here is the bill to introduce.' There has been a complex, complicated ongoing debate with a lot of industry people, with the regulator and with other stakeholders in relation to what ultimately should be put to the parliament. So on behalf the government, I certainly reject that there has been any deliberate strategy to shorten the time frame.

The time frame we are using for this process is the accepted time frame in terms of consultation in the parliament and it is certainly not, as has occasionally occurred, the telescope process where a bill is introduced on the Tuesday and jammed through by the end of the week. That is not the process we want to adopt and we are not adopting it here. There has been the appropriate conventions adhered to and we have proceeded according to that. Yes, we do have a deadline and the process we have outlined would allow us to meet that particular deadline.

The Hon. K.J. MAHER: I thank the Treasurer for his answer and the acknowledgement that it took a number of months and, in doing so, admitting that there is absolutely no reason whatsoever the bill could not have been presented to this parliament sometime last year for proper consideration. That being the case, can the Treasurer inform the chamber if the regulator has always published or made publicly available information about the CTP regime?

The Hon. R.I. LUCAS: I am advised, yes.

The Hon. K.J. MAHER: Specifically, was information about the findings of the 2017 review of the CTP vehicle class relatives made public or published anywhere?

The Hon. R.I. LUCAS: Sorry, could you say that again?

The Hon. K.J. MAHER: The 2017 review of the vehicle classes within the CTP scheme.

The Hon. R.I. LUCAS: I think the leader will have to explain. The regulator is not sure what the leader is referring to. Can you explain what review you are talking about?

The Hon. K.J. MAHER: I might get more information to be able to ask you between the houses or in the assembly.

The Hon. C. BONAROS: There is one point that I think I missed when I made my previous comments, which is something that I think we need to keep in mind, and that is that these inducements are not necessarily fixed in time. They can change as insurers change their models and come up with new proposals. That is also a very important consideration that we need to make. It is not that we have this list of inducements today and that is going to remain fixed into the future; it is very likely that it will continue to change and change often, I expect. That is the first point.

I want to address the comments of the Hon. Kyam Maher. He does, quite rightly, point out time frame issues, particularly with the crossbench. We often struggle to keep on top of all the bills that are before us and so sticking to time frames is important. But I think it is only fair to indicate in this instance that I certainly did seek all the briefings that our party required in relation to the bill when they were offered.

I should also indicate that I made clear our willingness to proceed with this bill on the basis that I was satisfied with the response enquiries I had made. I accept that amendments will be filed late from time to time—I am guilty of the same, as I think we all are—depending on the circumstances. In this instance, the comments I made referred to the late addition of amendments, which resulted in the additional enquiries that we made. We certainty undertook to make those in time for today's debate, knowing that there were deadlines in place. I just wanted to place that on the record.

Again, we were satisfied with the feedback we received, firstly in relation to the bill—and that is the basis on which we indicated our willingness to proceed—and secondly, in relation to the feedback we received on the proposed amendments.

The Hon. M.C. PARNELL: Before I put on the record the Greens' position in relation to the opposition's amendment, I want to make some brief observations about some things that have been said in the debate so far. When it comes to essential services—and in particular, compulsory services—the starting point for the Greens is that we believe, on the whole, they should be provided by the state. That was, in fact, the case until a few years ago.

The reason that compulsory education is palatable to the community is not just because education is a good idea; it is because the state provides it. If you make things compulsory, the state should provide the way for citizens to comply with their obligations; however, when it comes to compulsory third-party insurance, we appreciate that the horse has bolted. I note the Treasurer's comments that this particular privatisation went ahead without going through parliament, yet the parliament is now mopping up the consequences of that decision.

Given that the privatisation horse has bolted, the Greens' position is that we want the market to work as fairly as possible, and we want it to work to the advantage of the consumers of the services. In this case, it relates to motorists—people who have registered and compulsorily ensured their cars.

I will make another observation: the political rhetoric of Labor, especially as we come up to a federal election, is to attack the Liberals for real or imagined privatisation. When it comes to privatisation, Labor's practice in government has been as guilty as the other side, so we have to take some of this with a grain of salt.

The Greens take some comfort from the fact that this bill does not provide open slather in relation to inducements. We particularly like the fact that there will not be kickbacks to motor vehicle dealers. As people are aware, when cars are advertised, there is a lump sum called 'on-road costs'. It would be very easy for motor vehicle dealers to have kickbacks with insurance companies to make sure that the insurance company received the insurance work for that new car.

By way of an aside, I am in the process of ditching a mortgage, having discovered that a certain finance broker has been receiving trailing commissions at my expense for four years. I am over it and I am going to move.

In relation to the nature of these inducements, there has been mention of multipolicy discounts. If you comprehensively insure your car and you insure your home and contents and all the rest of it, then you may receive a discount. Whilst it is not on the original list, I would imagine that if the RAA were to enter this market, for example, they would probably throw in roadside service if you insured through them.

A lot of comprehensive insurance companies give you discounts if, for example, you do not drive very much, if you lock your car in a garage and things like that. Some companies will give you a discount on your home insurance if you have deadlocks on the windows. There is a whole range of incentives. I do not know whether there is scope for that type of discount or inducement in relation to this. I do not require an answer now, because I do not think the scope of inducements has been settled, but maybe there is.

The next thing I would say is that I did speak to Mr Mullighan, the shadow minister in the other place. He made some good points and I was inclined to think that he was on the money, but I made it clear that we are also keen to talk to the regulator. My staff did take up the offer of a briefing, which clarified the situation in my mind somewhat. The minister has alluded to some of the arguments against the amendments.

In relation to the idea of putting things in regulation so that they can be disallowed, generally the Greens' position has been, more often than not, that that is the position that we take. Disallowance of regulations is an important element of parliamentary scrutiny over the actions of the executive and, more often than not, the Greens will vote to put things into disallowable instruments in order to keep a level of supervision and control. However, I do take the point that we also want this market to work as effectively as possible. That will require rapid response in the market, which is not facilitated by an unwieldy regulation disallowance process.

Noting that the independent regulator intends to publish all this material without being required to by legislation and without it having to go through a regulation-making process, the Greens, on balance, have weighed up the arguments for and against it, and we are siding with the government in this case. We will not be supporting the opposition's amendment.

The Hon. J.A. DARLEY: I am well aware of the problems and the time required in dealing with disallowance motions, and I think that that would only lead to the disadvantage of the buying public. I thank the Leader of the Government for his explanation. I will not be supporting the amendment.

The Hon. K.J. MAHER: I have just a couple more questions by way of clarification on a question I previously asked. Was there a review in 2017 of vehicle class relatives; that is, the amount that is paid by taxis or hire cars versus the amount paid by normal cars?

The Hon. R.I. LUCAS: I am advised that the review to which the member is referring is probably an independent actuarial assessment that the regulator sought in relation to not just the issue the member has talked about but also to the appropriateness, or otherwise, of the price the former government had set at 3 per cent—CPI light increases. This is not advice to the regulator, but, as a cynic and from talking to people in the industry, the view from someone in the industry was that the government locked in the 3 per cent increase because it increased the price that they could get.

Of course, the CPI has been lower than 3 per cent over the transition period that the government locked in. By locking in a higher price, the government got a higher price for the privatisation. I hasten to say that that is not the advice of the regulator; that is my view, having discussed the issue with industry people and others.

The regulator took actuarial advice that was independent. That sort of advice is not what we are talking about here. We are just publishing inducements and things like that. That is informing the regulator in terms of the decision that she has to take, independently, about the appropriate premiums and premium bands that she will set sometime in May, or which will be released in May sometime, for the competitive model. There will be bands where the regulator will state the maximum and minimum for a particular band, and there will also be a decision the regulator will take in relation to the issue the member has talked about in terms of classes. There is a related debate going on about taxis, ride-sharing vehicles, chauffeured vehicles and others like that.

The regulator got independent actuarial advice in about 2017, which assisted her in developing her thinking. However, independent actuarial advice is not what we are talking about here. We are talking about inducements and those sorts of things—those sorts of decisions that are announced. Clearly, when she announces the premium classes and those sorts of things, that will all be public information—it has to be.

Her decisions about what happens with ride-sharing vehicles and taxis and those sorts of things are not decisions that she is in a position to opine on at the moment. She is still making her decisions in relation to that particular issue, and ultimately she will come to her conclusion as the independent regulator.

The Hon. K.J. MAHER: Advice was provided that looked at the relative price that ought to be paid within a class; that is, taxi or ride-share cars, versus—is it class 1 light vehicles—I am not sure if I have my definition right, but just normal private cars?

The Hon. R.I. LUCAS: The advice was, as I said, broad actuarial advice, which did provide some information to the regulator about premium classes, and that in and of itself would relate to taxis, ride-share vehicles and others, but that was not the purpose of the actuarial review. The actuarial review was actually looking at whether or not 3 per cent over the transition period would have been the appropriate rate.

It also informs the regulator, and there was nothing the regulator could do about that because the 3 per cent CPI light numbers for the transition period were locked in. But the actuarial advice that she got then, and also subsequent advice that she has got herself, is informing her in terms of the critical decision the regulator will make in terms of both the premium classes, to which issue the honourable member is referring, but also the premium bans for each of those premium classes.

The Hon. K.J. MAHER: This advice or review on the relative premium classes, where was that published in 2017 after it was received?

The Hon. R.I. LUCAS: I just said, it is internal independent actuarial advice; it was not published. Actuarial advice provided to the regulator, as a matter of course, is not published publicly. So what I am saying is that, when we are talking about publishing information publicly, like inducements and those sorts of things, that is not what we are talking about here. This was independent actuarial advice she got, internal, to inform her about the appropriateness of what had occurred or what was occurring during the transition period in terms of premiums, and also informs the regulator in terms of the decisions she has to make on what price she will set from July onwards.

The Hon. K.J. MAHER: I think the Treasurer can see the problem that is being created here, in that there was a secret review that talked about what the price ought to be for private vehicles compared with taxis, and that was not published, yet we are to rely on the word that in the future things will be published, when in the past they have not. Can I ask then: what was the result of this review in terms of the relative price between taxis, ride-share cars and private vehicles? Did it recommend that cars should go up relative to taxis, or that taxis should go up relative to cars?

The Hon. R.I. LUCAS: I do not propose to enter into any discussion about internal advice the regulator has taken about premiums. I would be delighted, I suspect—not that I have seen it—to see the results of the report in relation to whether or not the former government had set premiums at too high a level just to jack up its asset sale price.

The purpose of this review was not for the issue to which the honourable member is referring. The purpose of the review was to, in essence, look at the appropriateness of the 3 per cent CPI. As part of that, the actuary looked at a whole series of issues in relation to premium classes. Let us be quite clear: no report was done specifically on the issue of ride-sharing vehicles, taxis and those sort of issues.

It was a report on the appropriateness of the premium setting that the former government had entered into in the transition, and also to provide advice to the independent regulator to inform her about what is the appropriate level of premium she might set for all premium classes from 1 July. So I do not propose to answer any questions because I do not know the answers, and I do not propose to ask the regulator for the answers.

This is information she has to inform her about a decision that will be made public in July. To try to characterise that as the regulator being secretive and not releasing information that she should release, and to say that the regulator's commitment to publish inducements on her website in some way should be lumped together as, therefore, some doubt about the stated intentions of the regulator, I think is beneath the Leader of the Opposition in terms of that inference.

The Hon. K.J. MAHER: With respect, the Treasurer has outlined the problem very well, but how can we rely on this scheme when there is not even a requirement to publish? In the past, things that I would suggest have a massive amount of public interest have not been published. What has not been published is information that I think the public has a huge amount of interest in. That is, in terms of the premiums of taxis, those in the taxi industry would have a huge interest in knowing what that advice was two years ago. I disagree with the way the Treasurer is characterising the decision to keep private this report that I think has a huge amount of public interest. Has the Treasurer seen the secret 2017 report that was not published?

The Hon. R.I. LUCAS: No.

The Hon. K.J. MAHER: Why has the Treasurer not seen this report? Has he asked for it or has he been provided with it at any stage?

The Hon. R.I. LUCAS: The decision for premiums is a decision for the independent regulator. This seems to have escaped the Leader of the Opposition. The Leader of the Opposition was part of a government which privatised the Motor Accident Commission, set in place a private sector competitive model and authorised and approved an independent regulator. The independent regulator makes decisions about premiums. It is not appropriate for me to be grilling—and I have not—the independent regulator about what the level of premiums will be for the future for all classes, whatever that class might be.

I know there has been an ongoing issue about taxis, ride-sharing vehicles and chauffeur vehicles. Ultimately, whatever decision the regulator takes will be public for all to see come May. It is as simple as that. This is a scheme that the former government, of which the Leader of the Opposition was a member, established. The independent regulator is independent. We do not, I do not, direct the independent regulator about independent decisions that she will take about setting premiums.

The Hon. K.J. MAHER: Once the decision is made in May, will the Treasurer commit to publishing the secret review that has been held back for two years?

The Hon. R.I. LUCAS: No, I will not commit because I do not have a copy of it.

The Hon. K.J. MAHER: In terms of the bill before us, is there any requirement for the publication of inducements that are being offered anywhere?

The Hon. R.I. LUCAS: In relation to that last question, I will take on notice, once we get into the competitive market, whether the regulator has a view about the publication of her independent advice from an actuary. As I said, it is a decision completely for her to take. I do not have any concern about the independent actuary's advice about the former government's premium setting during the transition period because I suspect—as I said, without knowing because I have not read it—it will be a source of some considerable embarrassment to the Leader of the Opposition and his party if it is released publicly.

In relation to the second issue, we are retracing old ground. The independent regulator has given a commitment to publish this claim about the independent actuary's report being put into the same category. Therefore, I reject the inference that we cannot trust the word of the independent regulator.

The Hon. K.J. MAHER: Are there any other reports or information that the independent regulator will give a commitment to publish?

The Hon. R.I. LUCAS: That is a decision ultimately for the independent regulator. I am sure the independent regulator has taken a lot of advice from a lot of people and commissioned a lot of reports. It is ultimately her decision, and I suspect the vast majority of those will not be released.

The Hon. K.J. MAHER: Just to be clear, the Treasurer is telling us that there are many reports or advice that the independent regulator takes, and the Treasurer is suggesting that the vast majority of those will never see the light of day to the public. Is that what he is saying?

The Hon. R.I. LUCAS: I do not know what the number is. I am just saying I would assume there would be considerable advice the regulator would take. She is an independent regulator and, yes, I would assume, and I am happy to say, and I do not have a problem with an independent regulator taking advice and not publishing all of that advice, if that is her decision.

The Hon. K.J. MAHER: Is the Treasurer able to inform the chamber how many reports or pieces of advice the regulator has received and how many of those have been published, if any? If the answer is that nothing has ever been published, I am happy for the Treasurer to get up and inform the chamber of that.

The Hon. R.I. LUCAS: No, I am not.

The Hon. K.J. MAHER: Is the Treasurer himself aware of a single report or piece of advice that the regulator has published?

The Hon. R.I. LUCAS: I am not going to go down this particular path. It has nothing to do with the clause.

Amendment negatived; clause passed.

Title passed.

Bill reported without amendment.

Third Reading

The Hon. R.I. LUCAS (Treasurer) (12:02): I move:

That this bill be now read a third time.

Bill read a third time and passed.