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Legislative Council - Fifty-First Parliament, Third Session (51-3)
2009-04-28 Daily Xml
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STATUTES AMENDMENT AND REPEAL (FAIR TRADING) BILL

Committee Stage

In committee.

Clause 1.

The Hon. G.E. GAGO: A number of questions were raised during the second reading debate, and I will deal with some of those questions specifically when we deal with the appropriate clause. However, fair trading does not fit into any of those areas, so I will take the opportunity to address that issue under clause 1.

During the second reading debate, questions were raised about the proposed fair trading reforms. Some of the fair trading reforms outlined in the discussion paper, such as the proposal to allow officers to investigate breaches involving South Australian traders, are being considered in the development of a new national consumer law, and it is more appropriate that these reforms are considered as part of that process.

Most of the changes in this bill will strengthen the powers of the commissioner and will allow the Office of Consumer and Business Affairs to take more decisive action and deal with complaints more quickly. This may increase the number of complaints handled by the Office of Consumer and Business Affairs, but these new powers will also allow that office to use resources more efficiently.

Clause passed.

Clauses 2 to 6 passed.

New clause 6A.

The Hon. G.E. GAGO: I move:

Page 6, after line 31—Insert:

6A—Amendment of section 4—Application of Act

Section 4(3)—delete subsection (3)

This is a technical amendment and will remove reference to the Recreational Services (Limitation of Liability) Act, which is to be repealed, from the Civil Liability Act.

New clause inserted.

Clauses 7 to 9 passed.

Clause 10.

The Hon. G.E. GAGO: I move:

Page 7, line 31 [clause 10(1), inserted text]—Delete:

'Division 3A' and substitute:

Division 2A.

Again, this is a technical amendment. Clause 10 refers to Division 3A of the Trading Act. There is no such division or any proposal to create a new Division 3A. Clause 10 should instead refer to proposed new Division 2A. This amendment makes that correction.

Amendment carried; clause as amended passed.

Clause 11 passed.

Clause 12.

The Hon. G.E. GAGO: I move:

Page 9, after line 20 [clause 12, inserted section 8A]—After subsection (8) insert:

(8a) An application to the Magistrates Court under subsection (7)(b) is a minor statutory proceeding for the purposes of the Magistrates Court Act 1991.

This bill provides for consumers and traders to enter into a conciliated agreement. In the event that a party to a conciliated agreement fails to abide by the terms of the agreement, the commissioner or another party may apply to the Magistrates Court for an order enforcing the terms of the agreement. The amendment makes it clear that it is the Civil (Consumer and Business) Division of the Magistrates Court that will deal with these matters.

Amendment carried; clause as amended passed.

Clauses 13 to 34 passed.

Clause 35.

The Hon. J.A. DARLEY: I move:

Page 13, line 14 [clause 35, inserted section 74B(1)]—Delete:

'Subject to section 74I, a term' and substitute:

A term

This is consequential upon my amendment No. 2. It makes reference to section 74I which I will move to delete in amendment No. 2.

The Hon. G.E. GAGO: The government opposes this amendment, which proposes to make the prohibition against unconscionable conduct and the prohibition against misleading and deceptive conduct criminal offences. Neither the prohibition on unconscionable conduct nor the prohibition on misleading and deceptive conduct is a criminal offence under the commonwealth Trade Practices Act. The same is true in most jurisdictions across the country (I think there is an exception for Tasmania). The rationale for this is that unconscionable conduct and misleading and deceptive conduct are concepts that require interpretation and are not clear-cut. It would not be fair to impose criminal sanctions on people when it is so difficult for them to know in advance what steps they must take to avoid those contraventions.

Moreover, it is important to remember that misleading and unconscionable conduct cover a continuum of behaviour that ranges from very serious misconduct to, in some cases, very trivial breaches that can be quite unintentional. Under the proposed amendment, simple mistakes will be raised to the level of a criminal offence. Of course, there will be some forms of misleading and unconscionable conduct that should attract a criminal sanction. I beg your pardon, sir, I have been informed that I am not speaking to the correct amendment. Apparently, we do not have a copy of the amendment that has been referred to. I was assuming it was the next amendment that we had under the member's name.

The government opposes this amendment. The effect of this amendment would be that service providers would be subject to the statutory warranty that requires service providers to provide service with due care and skill. That would mean that service providers would not be able to waiver that statutory duty. So, if the government were simply to repeal the Recreational Services (Limitation of Liability) Act and do nothing more, recreation providers would not be able to use waivers to modify or exclude the statutory warranty that requires services to be rendered with due care and skill.

In effect, the proposed bill before the committee will provide that, under certain circumstances, adults will be able to waiver their rights but our bill proposes that children cannot do so. This amendment would remove the ability for anyone, both adults and children, to waiver their rights and, therefore, the government does not support it.

The Hon. J.M.A. LENSINK: My understanding (and I will take the advice of the mover with respect to his three amendments) is that section 56, which relates to misleading or deceptive conduct, and section 57, which relates to unconscionable conduct, will be made criminal sanctions; that is, subject to a $100,000 fine. I note that the member's next amendment, which I believe is consequential, is to delete entirely section 74I. For the reasons that the minister outlined in the immediately preceding explanation and the one prior to that, the Liberal Party will not be supporting these amendments.

Amendment negatived.

The Hon. G.E. GAGO: I move:

Page 13, lines 27 to 30 [clause 35, inserted section 74C]—Delete the section

Among other things the bill updates and consolidates South Australia's fair trading laws. As part of that consolidation the provisions of the Consumer Transactions Act have been repealed and placed in the Fair Trading Act. The effect of this amendment is to delete proposed section 74C of the Fair Trading Act. That provision has been carried across from the Consumer Transactions Act and is not appropriate in the context of broader provisions of the Fair Trading Act.

The Hon. A. BRESSINGTON: Will the minister make very clear the effect that proposed section 74C would have in relation to proposed section 74I, in particular whether this would prevent recreational service providers, at the compulsion of their insurers, having legally unenforceable waivers signed?

The Hon. G.E. GAGO: The effect of proposed section 74C, I am advised, makes it a criminal offence to require a consumer to sign a waiver where they are not permitted to do so. However, we recognise that some service providers will make genuine mistakes about asking recreational service users to sign waivers when in fact they are not permitted. This amendment ensures that genuine mistakes are not penalised.

The Hon. A. BRESSINGTON: I thank the minister for her answer, but I would like further clarification, because we know for a fact that some insurance providers are insisting that recreational service providers have waivers signed—whether they have validity or legal standing, or whether consumers are of the belief that they are waiving their rights for any sort of compensation for injury due to negligence, or whatever the terminology is. I am looking to see whether the government is providing ample protection for those recreational service providers who are literally forced by insurers to have waivers produced and signed.

The Hon. G.E. GAGO: I am advised that whether an insurer requires a waiver to be signed where they are not permitted they will not be effective.

Amendment carried.

The Hon. A. BRESSINGTON: I will not be proceeding with my next amendment.

The Hon. J.M.A. LENSINK: I move:

Page 17, lines 1 and 2 [clause 35, inserted section 74I(2)(b)]—Delete paragraph (b)

This amendment goes to the most contentious aspect of the bill, that is, the notion of child waivers. If this paragraph is to continue in this bill, our advice from the Insurance Council of Australia is that it will be more difficult and more costly for insurers to price risk, and that the inclusion of it in this bill would create a separate class of consumers, that is, children would be considered separate.

I do appreciate, as I outlined in my second reading contribution, that the common law is very clear in relation to child waivers when matters come before the courts. However, this bill is about recreational service providers—or those aspects within section 74 are about public liability insurance, that is, the ability of insurers to price risk and to provide it at an affordable price. We therefore think that this paragraph should be deleted from the bill.

The Hon. G.E. GAGO: The government opposes this amendment. Under the bill, minors who consume recreational services supplied in the course of a business will receive the protection of the statutory warranty that requires services to be rendered with due care and skill. Neither the child nor a person who acquires services on behalf of the child can waive that warranty or indemnify the service provider for a breach of that warranty.

Child welfare agencies have pointed out that children are the most vulnerable members of our community and are not in a position to clearly understand what rights they are giving away or question the actions of a service provider when a parent or guardian is not present—and parents are not always present during these recreational activities; children are not always supervised by their parent or guardian on all these occasions.

The government has been upfront with recreational providers and has made this very clear. The proposed amendment would only serve to confuse service providers. It will not allow minors to waive their rights to have the services provided with due care and skill. So the effect is that it still, in effect, protects the rights of children. However, the bill would remain silent on that and create ambiguity, leaving open the opportunity for insurers (as the Hon. Ann Bressington has mentioned) to use that as leverage. So insurers could, for instance, require that recreational service providers sign a waiver for children that we believe would be ineffective (and we have put that on record), but it would not make that practice illegal, and therefore could potentially hold service providers over a barrel.

Also, in effect, service users who have signed a waiver could, in fact, believe that the waiver was effective and if there was an accident they might not pursue their legal entitlements for compensation and therefore those children's welfare would be disadvantaged and families could be disadvantaged, because some of these injuries could be quite significant. Just because we are talking about the provision of a service with due care and skill, nevertheless, that could still result in accidents that could have profound and life-long effects on that child and therefore that family, for instance, paraplegia.

So, we believe this would create an ambiguity and uncertainty within the industry. Our view is that good public policy should be clear and unambiguous, and we believe the current bill before us does just that. We believe, as is the case in Victoria, that the insurance industry adapts to circumstances. We believe that, overall, the insurance industry will receive quite a positive effect from this legislation because of the provision of waivers for adults under certain circumstances, so we believe that it is fair and reasonable that waivers for children not be allowed.

The Hon. J.M.A. LENSINK: I have a couple of questions of the minister in relation to this. The minister has stated, both in her second reading contribution and this recent contribution, that this bill is modelled on the Victorian legislation. Can she advise the committee whether such an exclusion is included in the Victorian legislation or, indeed, any jurisdiction in Australia? Secondly, if the exclusion does not exist in Victoria, how long have those provisions been in operation and have they been successful?

The Hon. G.E. GAGO: I have been advised that there are no express provisions that exclude these matters anywhere within Australia. However, we are aware that there have been significant criticisms of, in particular, the New South Wales provision where the provisions for minors remain unclear. We believe that South Australia is in a privileged position. We are now building on work done by other states and we believe we have learnt from their experiences, and we believe that addressing this particular issue in a very overt and clear way improves the legislation and, in effect, provides South Australia with a very strong and clear good public policy.

The Hon. A. BRESSINGTON: I indicate that I do not support the amendment of the Hon. Michelle Lensink, and if I can have the indulgence of the committee I will explain why. I am in agreement with the minister about the ambiguity of the bill should its silence on minors go ahead, and there is also another concern that I have. I could not understand why the Insurance Council of South Australia was so keen either to have waivers signed or to have the bill silent on minors, especially when these waivers are unenforceable legally. Then it occurred to me that, if the bill is silent on minors, insurers can continue to have waivers signed by minors or their parents for what is colloquially known as the big bluff or the bluff effect.

It would be reprehensible of this place to pass an amendment that would basically indicate bad information to the public out there, to parents in particular, that, should their child be injured in a recreational activity, because they have signed a waiver, as the minister pointed out, they have no further claim to compensation, whereas we know they have a claim for compensation under common law. Many people would believe that they had signed away that right. I urge other crossbenchers in this place to consider the situation we would create in South Australia if we were to allow that bluff to continue, as it has for some time. I congratulate the minister for not falling into the trap and being under the pressure of trying to find a way through this to keep everybody happy. We should vehemently oppose this amendment.

The Hon. R.D. LAWSON: I believe the views of the Insurance Council on this point are important. After all, one of the critical issues facing us, and which must be addressed in this bill, is whether or not the providers of recreational services are able to obtain insurance at a competitive price. All of us I imagine believe that recreational services ought to be available, and particularly to those under the age of 18 years. We also believe that recreational service providers ought to be able to conduct their business without negligence and fairly, and ought to be able to obtain insurance because, if they cannot do so, those services will not be available. The Insurance Council says, as has been indicated by the deputy leader, that this provision is not reflected—and the minister has acknowledged this—in the civil liability legislation of other jurisdictions. The Insurance Council reported as follows:

Our members—

that is, the insurance companies—

report that the likely effect of section 74I(2) of the bill, if enacted, will see a significant increase in the price of public liability insurance for providers of recreational services to children, and the potential for some insurers to withdraw from the market.

I am not convinced by the minister seeking to sweep this under the table by saying that we have a unique opportunity in South Australia to do something that no other jurisdiction has done. That is hardly a convincing argument. We are seeking to ensure an adequate balance between the protection of consumers and the availability of these services and the availability of insurance. To sweep it under the carpet in the way the government seeks to do is lamentable.

The Hon. G.E. GAGO: I feel quite confused in terms of the mixed messages coming from the Hon. Robert Lawson, whose views I hold in high regard. He has a great deal of expertise in a range of areas and made a very significant contribution during the second reading debate, so I am most confused now at the position he is taking.

He spoke vehemently against signing away the rights of children. He even stood here in this chamber and said that he would never sign a waiver for a child, that it was a most improper thing to do, and that it would take away the rights of that child, possibly for the rest of their life, in circumstances where the well-being of that child might significantly rely on their potential to have access to compensation in relation to these matters. He spoke very strongly and movingly on this matter. Yet today he is supporting a provision that would allow exactly that to happen, even though inadvertently.

We have said that there is a possibility that insurance companies will use their bluff factor and will lean on service providers to require them to sign waivers for children and be invited to receive a particular insurance rate because of that. We are deeply concerned that the insurance industry could, by accepting the amendment moved by the Hon. Michelle Lensink, have that effect and insurance companies could lean on service providers, who would then be required to have waivers signed, even though they know it is ineffective and even though the Insurance Council knows that these waivers are virtually ineffective—it has admitted that publicly. Given that, why on earth would it want this important piece of public policy to be silent and ambiguous on this most important matter?

The Insurance Council itself has identified the ineffectiveness of these waiver provisions, so why on earth is it requiring that this bill remain silent? I am at a loss to know why the Hon. Robert Lawson would support such a provision that could very well have that effect. He stood there with his hand on his heart and said that as a parent he would never sign a waiver for a child.

The Hon. R.D. LAWSON: The minister suggests that this provision is necessary to stop insurance companies leaning on policyholders to seek invalid waivers. She points to no evidence at all of that happening. This bill, told by the government, is based on the Victorian model, which has been introduced. In the Victorian model this explicit provision does not apply.

The Hon. G.E. Gago interjecting:

The Hon. R.D. LAWSON: In Victoria the common law applies, and I am perfectly content for the common law to apply in relation to this matter. This provision, dreamt up in the minister's office as a unique provision for South Australia, will create uncertainty and make it more difficult for recreational service providers to obtain insurance in this state. For that reason the opposition believes that this explicit provision ought be taken out of the legislation; it has nothing to do with its ultimate effect. The provision is unique to South Australia. There is no need for it; it is not in the legislation on which this bill is modelled. Leave it out and let our recreational service providers obtain their insurance.

The Hon. R.L. BROKENSHIRE: I would like the mover of the amendment to advise the committee what evidence the Insurance Council of Australia has provided. In my second reading contribution I highlighted the frustration and annoyance experienced in trying to get basic facts and figures from the Insurance Council of Australia to find out why the premiums are going up so much. The insurance council alleges that so many people are putting in claims and getting massive payouts, but if it wants this committee to withdraw the amendment on the basis that it claims it will be cheaper and more affordable (and we all want that), then I ask: what categorical evidence has the insurance council given that premiums will be cheaper for those people if we remove this clause?

The Hon. J.M.A. LENSINK: First and foremost, the premiums will be cheaper with the repeal of the Recreational Services (Limitation of Liability) Act, which has been an unmitigated failure in this state. That will, of itself, have an effect. The evidence to which the honourable member can refer—which is the evidence to which the minister has also referred—is that these provisions have been successfully operating in Victoria since 2003. Thanks to those provisions, that state has been able to obtain affordable insurance; we cannot obtain affordable insurance in South Australia because we have a completely different regime.

Rather than just adopt the Victorian model holus-bolus, the government has sought to insert a clause which exists in no jurisdiction in Australia. An email from the Insurance Council of Australia, dated 24 February 2009 (and to which the Hon. Robert Lawson has referred), states:

Our members report that the likely effect of that section of the bill, if enacted, is to see a significant increase in the price of public liability insurance for providers of recreational services to children and the potential for some insurers to withdraw from this market.

That is the advice we have received. The insurance council advised that it will find it more expensive to price because it will be a different regime. This will be the only regime in Australia which operates differently to the other states, and therefore it is about pricing risk. I do not know what more evidence than that I can give. If you want cheaper and more affordable insurance, support the amendment; if you would like to see insurance less affordable for recreational service providers and for them to be unable to continue to operate as a result, oppose it.

The Hon. A. BRESSINGTON: I would like to ask the minister for some clarification. Do not the other states to which the Hon. Michelle Lensink has referred, which do not have this particular provision in their legislation, also have waivers, which could be somewhat responsible for the downward pressure on insurance policies for recreational services? If we are not supporting waivers, it is curious why we would want to be silent on children. I do not see the logic. We will keep this big secret that children who sign waivers will still have access to common law compensation if it is because of the misconduct of a service provider. I just do not understand the logic; why would we not want to make children's rights very clear in this legislation if we are not having waivers and if service providers are being forced to have waivers signed on behalf of children?

The Hon. Robert Lawson has said that he has not heard of any examples of that but, in fact, in my second reading contribution I gave a very clear example where a recreational service provider was forced by their insurer to have those waivers signed. I ask the minister: is there any evidence that not having this provision interstate but also having waivers is, in fact, responsible for affordable insurance? If we have decided not to go that way, why are we doing half of one and not the other? I am going round in circles here, but why would the opposition even suggest that it would be an acceptable way forward for the bill to be silent on children? I know I have not been very clear on the question, but are the waivers having an effect interstate?

The Hon. G.E. GAGO: My advice is that we know that Victorian's legislation is silent on the issue of waivers for children, but we are not sure whether or not the industry uses waivers. I do not have that advice with me. The New South Wales legislation is quite different but, again, generally speaking it is ambiguous about the provision of waivers for children. The advice I have is that the industry does use waivers for children. I am not aware of any major price differentials; I have not been informed of any significant price advantages that that creates across jurisdictions. However, the information is rather sketchy; it is not easy to get information from the insurance industry, as we are all aware.

The bottom line is—and let us be really clear about this—first of all, South Australia should not be afraid to lead in good public policy. Since when have we been afraid to provide leadership, sound direction and clear legislation in relation to good public policy that protects the fundamental rights and interests of our children? Since when have we in this state been afraid to show some leadership?

In relation to the effectiveness of waivers, we know from the Crown Solicitor's advice to us—and I know everyone has received similar advice, although there is a degree of ambiguity—that these waivers are ineffective; they are an ineffective means of dealing with the issue of warranty. So, this legislation seeks to ensure that waivers are not made available to remove the rights and protections of children.

In relation to price, the insurance sector is already likely to gain significantly from this piece of legislation so, because of the waivers around provisions under certain conditions for adults (and even the Hon. Michelle Lensink has put that on the public record), in terms of pricing there are likely to be significant positive effects for insurance companies with the successful passing of this legislation as it stands, without amendment.

We know that the insurance companies are ahead; why on earth would we want to go back to a situation where we know the law is unclear and ambiguous and gives the insurance industry an opportunity to use, as the Hon. Ann Bressington has clearly stated, a bluff factor that could potentially result in removing the important protections and rights of children?

The Hon. J.M.A. LENSINK: In answer to some of the Hon. Ms Bressington's questions, the New South Wales legislation is quite different, in that it specifically states that recreational service providers can provide child waivers, and it might be argued similarly that they are not worth the paper they are written on so why are they allowed to do it? One might ask the New South Wales parliament that. My understanding is that there is not a great deal of differential in pricing between Victoria and New South Wales; that is, the effect is similar.

I would ask the minister in a rhetorical question: since when has she protected the rights of recreational service providers? The answer is: not since 2002, because the existing legislation has been an unmitigated failure. What this is about is affordable pricing for insurance providers. We all agree that we would like recreational service providers to continue to be able to provide services, which means they need to have appropriately priced insurance.

Our best advice, and the experience over the border in Victoria, is that to take out this clause would provide that. So, notwithstanding all these arguments about protection of children, we know that at common law their rights are protected, and the matter before us is not whether they will continue to be protected—because they will—but whether those recreational activities they wish to participate in will still be available if this amendment is not supported. I commend the amendment to the committee.

The Hon. A. BRESSINGTON: The Hon. Michelle Lensink just stated that we know that children are still afforded those rights under common law and, yes, we do know but, once they sign a waiver, many parents do not know and believe they have no further recourse if their child is severely injured. If we propose that this bill remain silent on children we can only assume then that we are saying in this place that it is okay for insurance companies to continue to bluff members of the general public who do not have any further knowledge of how this legislation would work. We are here making the law; we understand these things. The average Joe Blow out there does not and often is bluffed by lawyers and insurance companies saying, 'You signed the waiver, mate; you should have thought twice.' It is happening.

The Hon. R.D. LAWSON: First, the minister suggests that the insertion of this provision which we seek to have removed will remove some ambiguity that exists currently about the status of waivers on behalf of children. There is absolutely no ambiguity about the status of waivers purportedly given on behalf of children. The common law position is perfectly clear; it has been clear for centuries. There is no need to insert some legislation to try to modify or even reinforce the common law. That will only create ambiguity, and it is for that reason that we do not believe this clause is appropriate.

The Hon. Ann Bressington says that people are being bluffed into signing waivers, that insurance companies are heavying people and that the rights of individuals are being jeopardised because of the existence of waivers which may not be effective. I do not believe that is the case. Everyone knows about the fine print on insurance policies and bills of lading and every other form of contract. People do not simply assume that what might appear to be the effect of that clause on their rights is the case. They consult a lawyer, who will advise them about the effectiveness.

I simply do not know of cases where people, for example, drive their vehicle into a car park which has a big sign saying 'Enter at own risk' and when their car is damaged they say, 'Oh well; there's a sign saying I entered at my own risk; therefore I have absolutely no claim at all, because I accept that there is a sign saying I entered at my own risk,' and that sign might well have been put on the door as a condition of an insurance policy.

All sorts of claims are made by people about their liability for damages. Ultimately, people do have to take advice and, when someone is seriously injured, there is no doubt that they do seek advice. There are lawyers who are prepared, on a 'no win, no fee' basis, to act for people who are injured. It is wrong to suggest that people out in the community will be confused about the effect on their rights if this particular provision, which is not found anywhere else in the commonwealth, is removed.

For the minister to say, 'Well, we're going to take the lead. We don't shy away from the fact that we will lead the nation in this particular area,' is a little like the proud mother at the ANZAC parade saying, 'Look, little Johnny is in step, and all the others are out of step.' We ought, in this case, stay in step to ensure that our recreational service providers have the opportunity to provide the services they seek to provide.

The Hon. R.L. BROKENSHIRE: I think that most members would acknowledge that waivers do not work and that we all want common law to be available to ensure that there is some legal recourse for anyone who is seriously injured. After taking advice in relation to this bill, we made a decision to support the government's removing the codes of conduct, which were introduced by the Hon. Kevin Foley back in 2004 or whenever it was, because they simply have not worked.

However, I was advised to be very careful in supporting the mechanisms the government will implement to replace the codes of conduct. I ask the minister whether she, on behalf of the government, can categorically assure the committee that she is absolutely confident that, if the committee supports retaining paragraph (b) as it stands, it will not increase insurance premiums.

The Hon. G.E. GAGO: The honourable member knows very well that it would be impossible to give that guarantee. The insurance industry is very complex, and its prices are affected by a wide range of factors not only within this state but also, more importantly, nationally and internationally. There are no guarantees around these things. The honourable member is an experienced member of parliament, and he would know that such a guarantee could not be given.

However, what we can do is look at some of the principles around this issue. As I have said in this place previously, we know, for instance, that the bill as it stands is likely to provide a particularly positive impact on the insurance industry by potentially bringing down the cost of their premiums. This bill provides for waivers, in some circumstances, in relation to the rights of adults and, overall, the insurance industry will potentially benefit from this provision. The insurance industry will receive a big positive from this legislation. So, they will be winners from the introduction of this legislation.

Let us now look at the other players. We have recreational service providers that have been faced with the imposition of codes of practice. I have already put on the record that these codes of conduct did not work, and I have also put on the record the reason why this government chose to go down the road of putting in place codes of practice during that time of insurance crisis rather than choosing other ways of dealing with the crisis. We believe that it was a more balanced and a fairer way to go. We tried something, but it was shown that it did not work. So, after a number of years of concerns being raised about the way in which it was working, we are now seeking to change the process.

This bill will provide much clearer certainty and surety for recreational service providers. We believe that, overall, it will potentially provide an opportunity for insurance premiums to be reduced, and recreational service providers will therefore benefit from that reduction in premiums. We believe that the provisions around the waivers for both adults and children are quite clear and overt in this legislation, making it possible for service providers to know where they stand in relation to the legislation. So, we believe that service providers will be winners in terms of this legislation.

In accordance with the advice I have received, our view is that these changes are unlikely to have a significant impact on insurance premiums imposed on services provided for children. It is on the record that these waivers are ineffective, so why would providing clarity about that provision have the effect of increasing insurance premiums? What we are saying is that, if waivers are in place, they are ineffective and are not offering insurance companies any protection at all. So, why would introducing legislation that makes that issue clearer, given that the advice is that waivers are ineffective, suddenly produce an adverse pricing outcome? It does not make sense.

I want to briefly place on the record my views in relation to the very unclear position put forward by the Hon. Robert Lawson. This provision about waivers for children makes it clear that this bill is overtly consistent with common law. How much clearer can you get? Yet, he is suggesting that somehow that provision produces an ambiguity. I fail to understand the logic of that statement whatsoever, because this provision makes it absolutely clear that, in relation to waivers for children, the bill is consistent with provisions under common law, and I think that that is a clarity everyone can benefit from.

The Hon. C.V. SCHAEFER: Having listened to this debate for some time, I want to put some of my personal concerns on the record. I happen to be someone who had children who did undertake high risk sports. They rode horses competitively, many of their friends rode motorbikes competitively and, indeed, one of my children was seriously injured. However, I believe that they had the right to participate in those high risk sports and that I had the right, if not the duty, to support them when they did so.

I cannot see that, under this proposed legislation, my grandchildren will enjoy the same freedom. I believe that, having participated in those sports, my children became stronger people both physically and mentally. They took risks which were legal and, in my view, healthy, in spite of, as I say, a fairly major accident.

I am currently on the board of management of Riding for the Disabled. I know that Riding for the Disabled parents sign a waiver. Is this legislation going to preclude people from participating in Riding for the Disabled? Is it going to so frighten country shows that they will no longer have showjumping? Is it going to preclude riding schools from having children participate? Many of us have been swamped with emails about this.

If adults want to do those things, they will be able to because they can sign a waiver, but will those people who conduct those businesses quite legitimately now be so frightened of the consequences that they will allow adults to participate but not children? Suddenly, we are going to have adult people who want to learn to ride and do the things they should have done and participated in as children.

What of Learn to Swim? Where is this going to stop? The Hon. Michelle Lensink's amendment does not seek to make the rights of parents to sign a waiver mandatory. It simply seeks to make the legislation open. As a parent whose children are now adults, I would be horrified to think that my grandchildren could not participate in what are, I am the first to admit, high risk sports because we have such a nanny state that they have to stay home and be very careful.

The Hon. G.E. GAGO: We have already dealt with these issues much earlier on in the debate, but I am quite happy to go over them yet again. People can still participate in all the same recreational activities that they have in the past. This legislation will have no impact on people's ability to participate in recreational activities.

The advice I have received is that children, whose rights are fundamentally protected under common law, cannot waive their common law rights and that waivers are therefore ineffective. They do not have the effect that people might think they have. The advice I have received is that, in effect, they provide a false sense of security for those people who are using them to reduce their liability. That is the best legal advice we have at the moment.

Currently, the legal advice is that the waivers people sign are ineffective. The Hon. Robert Lawson outlined this meticulously and at length in his second reading speech (I think it went for an hour and a half or so), and he outlined these very facts meticulously: given that currently waivers are ineffective, according to the advice that we have, people using them have a false sense of security.

The advice we have is that they have no effect in reducing the liability of service providers. If they have no effect, why would making that clear in legislation have a different effect? Why would that make any change to the price of insurance policies, given that we know that insurance companies receive the same kind of advice we have about the ineffective provisions of waivers? As I said, the best advice available is that waivers are ineffective because you cannot waive the rights of children under common law, whereas you can, I understand, waive the rights of adults under common law.

So, that is the crux of the issue. Fundamentally, the level of protections is the same under this bill as it is currently. The only difference is that this bill provides a consistency between this bill and common law and makes it very clear, in terms of the provision of waivers for children.

The Hon. J.M.A. LENSINK: Has the minister sought the advice of the insurance industry and, if so, what was it?

The Hon. G.E. GAGO: The same as what everyone else has received.

The Hon. J.M.A. Lensink: Have they told you?

The Hon. G.E. GAGO: That is their point of view. We have received a range of other advice. I have been open about what we have received, and it is on the record.

The Hon. R.L. BROKENSHIRE: I appreciate and accept what the minister has generally said; that this should be a better framework for insurance premiums than what we had in the past. However, in order for members on the crossbench to make a decision as to whether or not we support the government, I need an indication of whether the minister, on behalf of the government, is comfortable. I am not asking for a guarantee but I need an indication. Obviously, she has done some work, because I am told that this clause is different from other states. The minister has done this work and added this additional clause. Is the government comfortable that this clause will not have a negative impact on insurance premiums that will work against what we are all trying to achieve, and that is opportunities for people to be able to recreate, and so on?

The Hon. G.E. GAGO: The short answer is yes: the government is comfortable that it will not have a negative impact. However, as I have put on the record, there are no guarantees around this, given the complexity of the industry.

The Hon. R.I. LUCAS: This has been a confusing debate in some respects. The mere fact that we are debating the legislation is confusing, given that we were advised by the whips at lunch time today that this legislation was not coming on for debate and then, all of a sudden, mid afternoon it was brought on for debate.

The Hon. G.E. Gago: Oh, you poor thing!

The CHAIRMAN: Order!

The Hon. R.I. LUCAS: If the minister wants to operate that way, that is fair enough.

The Hon. G.E. Gago: Do you think that our priorities are moving?

The Hon. R.I. LUCAS: No, it is not a priority; it was further adjourned for the day. It was not a priority. It was indicated to all members that we would not even debate it today. I think that is the first—

Members interjecting:

The CHAIRMAN: It was a priority on my Notice Paper, I think.

The Hon. R.I. LUCAS: You obviously have one that is different from everyone else's, because your whips provided a copy to all other members that indicates that it was to be further adjourned today.

The Hon. G.E. Gago interjecting:

The Hon. R.I. LUCAS: I did not say anything to you.

Members interjecting:

The CHAIRMAN: Order! The Hon. Mr Lucas has the floor.

The Hon. R.I. LUCAS: The second point of confusion was that, over the past couple of weeks, I have been contacted by a number of recreational service providers—

Members interjecting:

The Hon. R.I. LUCAS: Have you finished squawking?

The Hon. G.E. Gago: You shouldn't call your colleague a squawker.

The Hon. R.I. LUCAS: I was talking to you. The second part that confused me is that, over the past couple of weeks, a couple of recreational service providers have urged me to support the Hon. Ms Bressington's position in relation to waivers.

The Hon. A. Bressington interjecting:

The Hon. R.I. LUCAS: I know. That is what I am saying; that is the confusing part. I am not criticising the Hon. Ms Bressington; I am just saying that a number of people asked me to support her position, because she was the person who was defending the rights of the recreational service providers. As I entered the debate I still had an open mind but, as my colleagues will know, I had a view that I was prepared to consider sympathetically some version of the amendment that the Hon. Ms Bressington was proposing.

Based on the advice of my learned colleague the Hon. Mr Lawson, we did not want to make allowances for waivers in the case where, as he colourfully described to us, the operators of the Spin Dragon carelessly leave a bolt off the bottom of the machine, but where you prevent negligence being condoned in any way—what you might call, as I presume my colleague the Hon. Caroline Schaefer might term, an accident occurring, when the operator has done everything humanly possible to prevent an accident occurring; that is, there has been no negligence—that was the general frame in which I was entering the debate.

As I said, it was only when I caught up with the fact that we were debating it that I realised that the Hon. Ms Bressington had removed her amendment and had changed (as she is entitled to do) her position somewhat significantly, if I could perhaps understate the position. So, for those of us who were being urged to support the Hon. Ms Bressington, I was listening to her argument and wondering why I was being urged to support her position when she appeared to be arguing completely the reverse of what I had been told her position would be. Those aspects have made it harder for some of us who are trying to follow the intricacies of this debate.

The third point I would make is that, with the greatest respect to my learned colleague the Hon. Mr Lawson, when you put eight lawyers together there is every potential that you will get eight different opinions. As an economist, I accept the same criticism if you put eight economists together. So, when the minister says to me it is absolutely clear that the law says this, this or this, I think the minister just does not understand the complexity of the law in relation to this issue.

As the Hon. Ms Lensink indicated, one other Labor-led parliament, supported by a number of other parties, I assume, and based on the best legal advice available to the New South Wales parliament—and I am advised that my colleague the Hon. Mr Evans, the member for Davenport, has supported provisions and a position which makes allowance for these waivers, which everyone says is absolutely clear—there is no doubt at all in the law that there is no point in having them.

I have not had a chance to talk to the lawyers who advised the New South Wales Attorney-General, the New South Wales opposition shadow attorney-general and all the members who supported it, but the one thing I have learnt in my long career in parliament is that those people who say that the law is absolutely clear are likely to be somewhat wide of the mark on most occasions. In my view it is always arguable, and clearly the New South Wales legal advice and parliament have taken a different view. We appear, as I understand it, to be adopting a similar legal view, position and process to the Victorian parliament in relation to that.

The fourth point I will make is to support some of the views my colleague the Hon. Caroline Schaefer put, as well as a question from the Hon. Mr Brokenshire to the minister, in relation to what will be the impact of this legislation. What we as individual legislators are being told is that some recreational service providers' views are that if this legislation goes through they will not be able to continue to operate. They will not operate. They will not provide those services they currently provide. The minister is saying that that is not the case. I am not in a position to agree or disagree because, in the end, we will not know, assuming this legislation passes.

I guess that it is my concern that there has been such a depth and breadth of concern from some recreational service providers that we may well find that the degree of comfort the minister is giving, that this will not impact on the industry and recreational services, will be wide of the mark. We were in fact given indications that the legislation of four or five years ago—however long ago it was—would solve all these problems, and it did not. We are now being told, 'Don't worry. We've sorted it all out. The law is clear and this will not impact.'

Well, I am a cynic in relation to these things. I guess that, whilst I cannot prove it and I am not in a position to prove it, all I can say is that, for those who accept the minister's position on this, only time will tell. I hope you are right. I hope that those of you in the majority, the Hon. Ms Bressington and the government, are right. I sincerely do, because I hope that the recreational services industry can continue to provide the services they have got, that young people can continue to take reasonably based risks in terms of horse riding, motor biking and a range of other things such as that, that the industry can continue to operate and that the rights of those who are injured are protected as well.

I do hope that you are right, but there is the cynic or the doubt in me which says that, in a year or two or in a few years, this parliament will be asked again to revisit this legislation and we will see that the impact has been significant on some sections of the recreational services industry, contrary to the assurances being given by this minister and this government that it is quite clear that the law is clear on this issue.

The Hon. A. BRESSINGTON: First, I made very clear in my second reading contribution that I would be withdrawing my amendment on waivers. Perhaps if we took more time to read second reading explanations we would all be up to scratch. However, it has not been a backflip or a turnaround. The reason I withdrew my amendment on waivers—and I will be quite honest about this—is that, in the beginning, I took advice from the member for Davenport who was very clear in his support for waivers for children. However, when we looked into this further we realised that waivers for children were not effective, that they were not legal.

We still have children who are participating in recreational activities being threatened with no cover. Recreational service providers are being threatened by insurance companies that if waivers are not signed then children will participate without coverage. It is that bluff factor that should get under our skin. Insurance providers are hiding behind this waiver and relying on the fact that not all people will be conned, but some will. If this was to go head, that is what would put the downward pressure on insurance premiums. If we are going to support dishonesty—let us call it what it is—if we are going to support that in order to keep the insurance industry happy, then shame on us.

It started out to be clear for the Hon. Rob Lucas that this is not a last minute backflip by me. This position was considered. I know that this particular debate on waivers did cause problems within the Liberal Party—and rightly so. When I realised that it was not Liberal Party policy for waivers and realised the reasons why, I withdrew that particular amendment.

The committee divided on the amendment:

AYES (12)
Brokenshire, R.L. Darley, J.A. Dawkins, J.S.L.
Hood, D.G.E. Lawson, R.D. Lensink, J.M.A. (teller)
Lucas, R.I. Parnell, M. Ridgway, D.W.
Schaefer, C.V. Stephens, T.J. Wade, S.G.
NOES (9)
Bressington, A. Finnigan, B.V. Gago, G.E. (teller)
Gazzola, J.M. Holloway, P. Hunter, I.K.
Winderlich, D.N. Wortley, R.P. Zollo, C.

Majority of 3 for the ayes.

Amendment thus carried.


[Sitting suspended from 18:10 to 19:45]


The Hon. G.E. GAGO: I move:

Page 17—

Lines 3 and 4 [Clause 35, inserted section 74I(2)(c)]—

Delete paragraph (c) and substitute:

(c) the supplier has given the consumer a notice in a form approved by the Commissioner setting out—

(i) the terms of the exclusion, restriction or modification; and

(ii) any other information that the Commissioner thinks fit; and

Line 5 [Clause 35, inserted section 74I(2)(d)]—

Delete 'term was' and substitute:

terms of the exclusion, restriction or modification were

Lines 7 and 8 [Clause 35, inserted section 74I(2)(e)]—

Delete 'term in the prescribed manner' and substitute:

Terms of the exclusion, restriction or modification in a manner approved by the Commissioner

I have just filed these amendments and I draw them to the attention of—

Members interjecting:

The CHAIRMAN: Order!

The Hon. G.E. GAGO: They are an excited lot, Mr Chairman. I filed these amendments around dinner time as a result of the opposition's successful amendment just before dinner to remove the provision that made—

The Hon. S.G. Wade: Well, you should have tabled them before dinner.

The Hon. J.M.A. Lensink: You have had them for weeks.

The Hon. G.E. GAGO: I would like them to listen so I do not have to repeat this, which inevitably I will have to do.

The Hon. S.G. Wade: We know what is happening. You are just trying to ambush the debate.

The Hon. G.E. GAGO: If they could just calm down, Mr Chairman. Right on dinner time—

The Hon. S.G. Wade: We can see. You tried to do the same thing with equal opportunity.

The CHAIRMAN: Order! There might be some others who want to hear it, Mr Wade, if you do not. You might want to leave the chamber.

The Hon. G.E. GAGO: We just need to do the business of the chamber. There is no need to get excited. Everything is all right. Democracy will be upheld.

The CHAIRMAN: The minister will help by not exciting members any more.

The Hon. G.E. GAGO: Thank you for your guidance, Mr Chairman. So, right on dinner time an amendment by the opposition that made waivers for children ineffective was upheld. I had considered what I would do if that occurred. I believe that this provision helps damage control, if you like, the effects of that provision, so that is why it was filed at the time that it was.

The Hon. S.G. Wade: It should have been tabled before dinner.

The Hon. G.E. GAGO: The amendment was only passed—

The Hon. S.G. Wade: Yes. Well, table it straight after that.

The Hon. G.E. GAGO: We did, but there were no attendants in the chamber at the time.

The CHAIRMAN: Order! It would be best if the minister does not respond to interjections that are out of order.

The Hon. G.E. GAGO: Democracy will prevail because I am just drawing it to people's attention now. We do not have to deal with it now. I have filed it now. It is a very simple amendment, so I am happy to test the waters but, if the prevailing mood is that members need more time to think about it, I respect that. What I would then do, after hearing from people, is I would be prepared to withdraw it and then recommit it, perhaps tomorrow, after people have had time to sleep on it, if that is what they believe that they need to do.

No-one needs to feel that they will not have adequate time to think about this. It is a very simple amendment. I take the opportunity now briefly to describe the effect of this amendment. There has been some concern that the reference to 'prescribed particulars' may not allow the government to prescribe a waiver that includes information about the rights of consumers.

In relation to some of the discussion that occurred previously, a concern was raised by me and other members of the bluff factor. I am sure that no-one would like a provision to prevail within the industry whereby insurance companies could bluff recreational providers into signing waivers. I am sure that no-one here would like that to occur. This allows a provision that would enable us to inform consumers, through information on the waiver, as to their legal entitlements under certain provisions.

The purpose of amendments Nos 1, 2 and 3 is to ensure that the government can require waivers to include information about the effect of the new law on the rights of consumers. It may be appropriate, for example, to explain on a waiver that there are other laws that affect people's rights to claim compensation, such as their common law rights, and amendments Nos 1, 2 and 3 ensure that this can happen.

The prescribing information would be done through regulation, which is a multipartisan committee structure. So, again, everyone would have plenty of opportunity to see those details. This is a provision that would enable us to damage control, if you like, any potential bluff factor effects.

The Hon. J.M.A. LENSINK: I indicate that we will not be happy to proceed with this. I feel somewhat ambushed. Clearly, the minister has had our amendment on the record for weeks and was well aware of it, as we have had discussions about it, and she has had this prepared and brought to our attention just as we resumed debate. So, I am not happy to discuss this until we have had due chance to consider it.

The Hon. R.D. LAWSON: I have a couple of questions for the minister in relation to this late amendment. First, has she had any discussions with the insurance industry to indicate whether it regards this proposal as facilitating the provision of insurance in South Australia at the same rate as is offered in other comparable jurisdictions? Secondly, will the minister indicate to the committee the model, if any, adopted for the introduction of this provision? Thirdly, how is this seen as consistent with the model adopted in Victoria, which was allegedly the basis of the bill before us?

The Hon. G.E. GAGO: The answer to the first question is no. Clearly I did not know the outcome, although, as the Hon. Michelle Lensink indicated, her amendment had been on file for some time. I have many gifts but telepathy is not one of them, so I did not know the outcome or numbers. Many members held their cards very close to their chest on how they would vote on that matter. I was not able to predict the outcome of that and was not able to predict the outcome of that particular amendment until that matter was put.

With regard to discussing it with the industry, no, I have not, but I am quite happy to consult with industry—that is not a problem. In terms of the model, I have talked about South Australia providing some leadership in terms of addressing the ambiguity identified and criticised in other jurisdictions. The Victorian model was something on which we based our legislation, but I have never indicated that our legislation was identical to that. In fact, I have always indicated that our version was an improved and unambiguous piece of legislation.

I have been advised that the amendment as put is in a form approved by the commissioner. That has just been drawn to my attention. I requested that that be done through regulation, which is not indicated in this amendment. As I indicated, I am happy to do the amendment here and now, but I am more than prepared to withdraw and recommit, perhaps tomorrow.

The Hon. R.L. BROKENSHIRE: Whilst Family First would need some time to deliberate over this late amendment, will the minister in lay language explain the intent of the amendment for the bill and for consumers?

The Hon. G.E. GAGO: It informs and educates consumers as to their rights in terms of their protection under law. For instance, some of the prescribed information we could give to consumers that might be included on the waiver might, for example, indicate that there are other laws, such as common law, that enshrine consumers' rights, particularly the rights of children. It is to educate and inform.

The Hon. A. BRESSINGTON: I ask the minister to clarify this for me: will the information included on a waiver be the responsibility of the insurance providers, or will it be a separate piece of information that the commissioner will provide?

The Hon. G.E. GAGO: My advice is that this information will be included on the waiver and the waiver will not be effective unless this information is included, and that information will be prescribed, as always intended, by regulation.

The CHAIRMAN: I am in the hands of the committee to decide whether this amendment is dealt with now or, as the minister has indicated, whether we soldier on and the minister handles it by recommitting it.

The Hon. G.E. GAGO: Given that the opposition has indicated that it needs more time, I am happy to withdraw the amendments. I indicate that I will recommit and will look to do that at our earliest convenience.

The Hon. R.D. LAWSON: I pose a question for the minister to answer in due course. I do not expect an answer now. I certainly agree with the course of action she has proposed. One of the real difficulties about waivers and children is that a child is entitled to bring an action up to three years after it achieves its majority. For an injury suffered to a child aged, say, five, we are talking about the possibility of an action being brought some 15 years subsequently. In those circumstances, the proof of waivers and other events that occur at the time are extremely difficult or may be extremely difficult to establish. Perhaps the parties at the particular time will realise how seriously the child is injured or will realise the importance of keeping records and documents. We know, for example, that medical records and the like are ordinarily kept but does that also apply to things like waivers and notices in forms prescribed by regulation by the minister? Are they signed? I raise that as yet another difficulty in the way of the government endeavouring to improve, in some way, the common law in relation to this matter.

The Hon. G.E. GAGO: I seek leave to withdraw my amendments.

Leave granted; amendments withdrawn.

The CHAIRMAN: The next indicated amendment to clause 35 is in the name of the Hon. Ms Bressington.

The Hon. A. BRESSINGTON: I move:

Page 17, line 12 [clause 35, inserted section 84I(3)]—

After 'established' insert:

(by applying the general principles set out in section 34 of the Civil Liability Act 1936).

As I detailed during my second reading contribution, this amendment seeks to make sure that the courts, when determining whether a recreational service provider's reckless conduct causes significant injury, that they apply the current principle of causation codification by section 34 of the Civil Liability Act 1936.

Much of the angst about this bill has arisen due to the new language to be introduced into what was otherwise a largely settled area of law. While the test of negligence is now largely directed by statute, each component has undergone thorough litigation and it is now predominantly clear about what a plaintiff must successfully allege to be awarded damages. A fundamental component of this test is that of causation which not only requires the plaintiff to demonstrate that the defendant's negligence was a necessary cause of the injury but also that it is appropriate to hold the defendant liable for the injury sustained.

The concern in the bill before us is the new definition of 'cause' which includes the phrase 'contributes to'. This would be the only instance of a statutory definition of 'cause'—other than the Civil Liability Act—and, when one compares the requirements of section 34 to the term 'contributes to', one sees the potential for a plaintiff lawyer to argue that causation, as set out, does not apply as this is much more restrictive than 'contributes to'. This amendment, which works in tandem with my other amendment that removes the definition of 'cause' from the bill, directs the court to apply the principles as outlined in section 34. In addition to the consistency provided, this is what I consider a preventative step and I hope, if passed, it goes towards ensuring that the balance struck by this bill is not undermined during the process of litigation.

The Hon. G.E. GAGO: The government supports this amendment. Amendments Nos 1 and 2 deal with the definition of the term 'cause'. The amendments make it clear that the ordinary principles of causation applied in the cases of negligence are to be used when assessing whether a provider's reckless conduct caused a consumer's injury, and we think the bill benefits from this clarification.

Amendment carried.

The Hon. R.L. BROKENSHIRE: I move:

Page 17, after line 20 [clause 35, inserted section 74I]—After subsection (5) insert:

(5a) A person who, under a contract of insurance, agrees to indemnify a person who supplies recreational services in relation to any liability that may arise out of the provision of those services must—

(a) within 30 days after a claim is made under the contract—notify the Commissioner of the claim; and

(b) within 30 days after the claim is finalised—notify the Commissioner of the outcome,

in a manner and form approved by the Commissioner.

Maximum penalty: $2,500.

Expiation fee: $210.

(5b) The Commissioner must include in the report under section 12 statistical information about the claims of which the Commissioner has been notified under subsection (5a), including information about the supplier, claimant, type of conduct giving rise to the claim and outcome.

The reason for moving this amendment is quite simple. After consideration of the debate on removing part B of the opposition's amendment, I stand by the fact that Family First has enormous concern when it comes to the transparency and credibility of a lot of insurance company claims, about how much claim and liability they have in respect of sporting and recreational activities.

I think it would be appropriate and in the interests of this legislation if there were transparency when claims occurred. In a nutshell, this amendment sets out a framework for a reporting process and, most importantly, it requires the commissioner to include in the report 'statistical information about the claims of which the commissioner has been notified under subsection (5A), including information about the supplier, claimant, type of conduct giving rise to the claim and outcome'.

Whilst I do not want to see a rise in premium for or an impost placed on people participating in these kinds of activities, there needs to be this sort of transparency, and pressure needs to be placed on these insurance companies to provide transparency. I think it is time that the community and the parliament had some transparency, and that is why I move this amendment. I see this amendment as a simple reporting process to put pressure on insurance companies to provide transparency.

As the Hon. Rob Lucas has said, we do not want to be revisiting this legislation time and again, particularly when insurance companies are a bit like fuel companies in that any excuse will do to put up their price. I want to see some factual evidence that claims are occurring so that in the future the parliament and the community have the right to see that proper transparency and consideration are given to claims, and that is what this amendment is about.

The Hon. G.E. GAGO: The government opposes this amendment. It requires insurers to notify the commissioner of insurance claims and the outcome of those claims. The commissioner must then include that information in his annual report. This places an administrative burden on both insurers and the Office of Business and Consumer Affairs for no real benefit. Although the Office of Business and Consumer Affairs would collect information about the number of claims made and resolved, there is little to be gained from the collection of that information. It would also be very difficult for the Office of Consumer and Business Affairs to enforce this requirement on overseas insurers. For those reasons, we oppose the amendment.

The Hon. J.M.A. LENSINK: I commend the honourable member for this initiative. I understand his frustrations in relation to the collection of statistical data relating to this industry. However, I agree that it would place an unreasonable administrative burden on both OCBA and the insurance industry without a huge amount of gain. I note that the relevant monitoring body in the first instance for the insurance company rests with the responsible commonwealth agencies; therefore, it is more than likely more information is available that is collected at that level.

Amendment negatived.

The CHAIRMAN: The next indicated amendment is in the name of the Hon. Ms Bressington.

The Hon. A. BRESSINGTON: Mr Chairman, I withdraw the amendment.

The CHAIRMAN: I do not think so.

The Hon. A. BRESSINGTON: You do not think so?

The CHAIRMAN: It is up to you, of course.

The Hon. A. BRESSINGTON: I move:

Page 17, after line 20 [clause 35, inserted section 74I]—After subsection (5) insert:

(5a) The Commissioner must publish information setting out the rights of consumers in relation to contracts for the supply of recreational services on a website determined by the Commissioner.

This amendment requires that the rights of consumers be posted on the OCBA website by the commissioner so that service providers can refer their customers to that website to be informed of their rights, as well as the information that is included on the waiver. I thought that, because of the waiver amendment, this particular amendment would not be necessary, but then I realised that we have not voted on it` yet, and so that is why I am moving this.

The idea behind this is that service providers can be forced by their insurance companies to have waivers signed. I have an example, whereby they can try to explain that the waiver is not lawful for children but the insurance company will still insist that parents sign those waivers on behalf of their children.

The service providers can then refer such customers, who are being forced to sign waivers, to the OCBA website to get the information about their particular rights for damages or for compensation if a serious injury occurs rather than having to take the recreational service provider's word for it. Some of them have not been believed when they have informed their customers that these waivers are nothing more than a bluff. That is the reason for this amendment, and I commend it to members.

The Hon. G.E. GAGO: The government supports this amendment. I know that, even though we indicated a further amendment, it would still be complementary to this. The government is very pleased the honourable member is continuing with this amendment, which aims to inform consumers about their rights and the effect of waivers.

I believe that the information will help consumers understand their rights and the effect of the new law, and I think that is a very good thing. They do this by accessing a particular website. I understand that information about the website for consumers is made in a discretionary way. There is no significant impost on either service providers or service users.

The Hon. R.D. LAWSON: Can the minister explain to the committee what she means by this provision being 'discretionary' in some way?

The Hon. G.E. GAGO: There is no requirement on the service provider to provide information to the recreational service user that the website is available or what information is on it. So, there is no impost. The information would be made available on the website—that is my understanding—and it would be up to service providers to make consumers aware of that information, or, for that matter, recreational providers initiating an interest and accessing it. What I am trying to indicate is that there is no requirement that that information be made available or reference be made to the availability of that information on that particular website.

The Hon. R.D. LAWSON: The minister's statements have re-undermined any confidence that one might have ever had that this minister has any grasp of this provision, with the government agreeing to a proposal that you put on a website something that will give consumers information about their rights. Their rights will actually be determined in the particular contractual arrangements that might have been entered into, in relation to the particular transaction, in relation to the particular waiver (if there be a waiver) or, generally, in relation to many factors. The idea that you can actually put up a website that describes the rights in anything but the most general possible way is absolutely ludicrous.

The Hon. G.E. Gago: What are you so afraid of, then?

The Hon. R.D. LAWSON: Well, I am not afraid of anything. It is misleading to suggest that we put up a website, and then you will say to consumers, 'Well, you should've looked at the website; that will tell you what your rights are.' This website could never tell them what their rights are.

The Hon. G.E. Gago: So, what are you afraid of?

The Hon. R.D. LAWSON: I am not afraid of anything. The job of this committee is to ensure that this legislation is workable and is useful and that it does not create websites and suggestions that, if you just look at the website, you know everything. The Hon. Ann Bressington had the good sense to say in the first place that she was not going to move it. Unfortunately, she changed her mind with the encouragement of the minister and you, Mr Chairman. I am frankly staggered, but not surprised.

The Hon. A. BRESSINGTON: I thank the Hon. Mr Lawson for commending my common sense; it is going to be on the public record. I think we need to clear this up. The intention is to post on the website information about the legality of a waiver that parents are being forced to sign for their children to participate in recreational services. They are being forced to sign the waiver because the insurance company is forcing the recreational service provider to insist on that.

As the Hon. Michelle Lensink mentioned earlier in this debate, people know their rights—they just know them! Well, people do not; people get conned by this. This is again trying to eliminate the insurance providers' bluff that if you sign a waiver you sign away your rights to compensation for serious injury.

For the commissioner to post this information on the website of the Office of Consumer and Business Affairs, it gives the explanation of the invalidity of these waivers some weight when recreational service providers are trying to keep contracts and trying to keep people from participating in their activity who really do not feel comfortable about signing away the rights of their children.

Every member in this chamber got the letter from the lady who runs the riding school. She was told by her insurance provider that the parents of those kids must sign a waiver, and she tried to explain to the school and to the parents that it meant nothing if their kids were seriously injured through negligence. Still, the parents would not sign the waiver, and she lost that contract.

This is a mechanism to help provide some sort of protection to those recreational service providers who are literally being bullied by the insurance companies to have waivers flaunted and consumers made to sign in the belief that maybe even 10 per cent of them will think that they have signed away their right to compensation for serious injury.

The Hon. M. PARNELL: I will weigh into the debate at this stage to say that I will be supporting the amendment. If there is anything that has characterised all the debate so far, it is that this is a complex area of law that most members do not fully understand. The idea of the commissioner putting on a website even basic information about how the statute operates—things that might be legal or illegal to put into a contract, whether they be the issues raised by the Hon. Ann Bressington or other issues—is no different to the sorts of websites that tell people what to look out for when buying used cars and a whole range of other things where you do need to have some basic information.

I accept what the Hon. Robert Lawson says: this is not specific legal advice. There will be other things in contracts that determine whether or not the person has any rights. The website cannot answer all those questions, but it might be able to tell them whether or not certain clauses are likely to stand up. I think that, given members' difficulty understanding liability and the interaction between the common law and the statutory protections offered by the bill that we are now amending, any regime that proposes more information and more clarity is to be supported.

The Hon. J.M.A. LENSINK: I do not think that too many people would agree with the Hon. Mark Parnell. The more information the better and the clearer the information the better, but there is no need to do it through a clause in a bill, particularly when the terminology is used in relation to contracts. As I think the Hon. Robert Lawson was indicating, how can you possibly provide information on a website, or put a clause in a statute, that will cover every possible form of contract? It is rather preposterous. We support the principle, but it just does not belong in an act of parliament.

Amendment carried.

The Hon. A. BRESSINGTON: I move:

Page 17, lines 22 and 23 [clause 35, inserted section 74I(6), definition of cause]—

Delete the definition

As stated earlier, this amendment removes the definition of 'cause' from the bill and, with it, the contentious phrase 'contributes to'. It is consequential to the amendment previously agreed to.

Amendment carried; clause as amended passed.

New clause 35A.

The Hon. J.A. DARLEY: I move:

Page 21, after line 2—After clause 35 insert:

35A—Amendment of section 75—Offences against this Part

Section 75(1)—delete '(other than section 56 or 57)'

This amendment is aimed at permitting the Commissioner for Consumer Affairs to issue fines against persons or corporations that contravene sections 56 or 57 of the Fair Trading Act, which relate to misleading and deceptive conduct and unconscionable conduct. I outlined in my second reading contribution circumstances in which consumers are left with no other alternative than to sue rogue traders for misleading and deceptive conduct, because OCBA does not have the power to issue fines for this type of conduct. I think that the commissioner's role should include powers to issue fines to send a real message to those people who prey on consumers.

The Hon. G.E. GAGO: This amendment proposes to make the prohibition against unconscionable conduct and the prohibition against misleading and deceptive conduct criminal offences. Neither the prohibition on unconscionable conduct nor the prohibition on misleading and deceptive conduct is currently a criminal offence under the Trade Practices Act. The same is true in most other jurisdictions (I understand that there is an exception in Tasmania).

The rationale for this is that unconscionable conduct and misleading and deceptive conduct are concepts that require interpretation and are not clear cut. It would not be fair to impose criminal sanctions on people when it is so difficult for them to know in advance what steps they should or could take to avoid that potential contravention. Moreover, it is important to remember that misleading and unconscionable conduct cover a continuum of behaviour that ranges from very serious misconduct to quite trivial breaches that can be unintentional. Under the proposed amendment simple, unintended mistakes would be raised to the level of a criminal offence.

Of course, there will some forms of misleading and unconscionable conduct that should attract criminal sanction in specific cases where it is easier to tell whether conduct is misleading. The Fair Trading Act does create criminal offences. Take section 58, for example. Under that section, a person must not falsely represent that goods are of a particular standard, quality, value, grade or model, and so on. Traders clearly know that false representations about the quality of goods are misleading and that they will be guilty of an offence if they make false representation.

Although opposing the proposed amendment, the government agrees that more needs to be done to help consumers resolve disputes involving allegations of unconscionable and misleading conduct. We certainly are sympathetic to the sentiments underlying this particular amendment. The government therefore has included a provision in the bill that will give the commissioner the power to conciliate disputes on behalf of consumers and compel traders to attend conciliation conferences. We have included that provision in the bill, but we are unable to support this amendment as it stands.

The Hon. A. BRESSINGTON: I seek clarification from the Hon. Mr Darley. Is your amendment to do with, say, some of the incidents we see on Today Tonight—the rogue builder who keeps going around ripping off people and is never brought to justice? Is that the type of conduct you are talking about, where there never seems to be any sort of recall for people and they are not stopped from continually ripping off one person after the other? Is that the intention of your amendment?

The Hon. J.A. DARLEY: Yes, that is the intention, because these particular rogue traders know that no action will be taken by OCBA. They go through the conciliation process, but nothing ever happens.

The Hon. R.D. LAWSON: I should indicate that, whilst I have every sympathy for the sentiments behind the Hon. John Darley's amendment, I do not think it should be supported, not only for the reasons given by the minister but also by reason of the fact that this legislation, the Fair Trading Act, follows the model of the federal Trade Practices Act, which does not provide for specific criminal penalties for misleading and deceptive conduct or unconscionable conduct. However, the legislation does provide a civil remedy, which is available to anyone who suffers loss in consequence of misleading and deceptive conduct or unconscionable conduct.

As the minister quite correctly says, this does not mean that rogue traders are free to engage in fraudulent activities, because there are other provisions in the act—notably section 58 (I think it is)—which contain a long series of prohibitions which will catch any rogue trader engaging in the sort of false and misleading representations that ought be stamped out.

New clause negatived.

Clauses 36 to 45 passed.

New clause 45A.

The Hon. R.L. BROKENSHIRE: I move:

New part, page 23, after line 35—Insert:

Part 5A—Amendment of Government Financing Authority Act 1982

45A—Amendment of section 11—Functions and powers of Authority

Section 11(1)(d)—after 'the State' insert:

, including, for example, acting as the insurer of first choice for persons who supply goods or services on a not-for-profit basis

I am moving this amendment because, frankly, I think it is a good bit of social policy. It seems to be that, these days, more and more is to be done by the private sector, but every now and again there needs to be a check and a balance. We continually see premiums going up with no explanation, no transparency and no opportunity for little organisations to combat what effectively almost puts them out of business, or, in many cases, stops that organisation from continuing and therefore deprives our community of the pleasures and enjoyments we have been able to have during our lifetime.

SAICORP, as a government insurance company, was set up primarily to look after government insurance requirements, but I point out that a number of voluntary organisations are already covered by SAICORP. There is no reason why the government could not run efficiently additional policyholders for not-for-profit organisations, such as those we have mentioned today that are so valuable. It would put a bit of pressure on the private sector in terms of stopping what I see as a rip-off. I have no evidence to say otherwise (because you cannot get the evidence from the insurance companies), but I am not advocating that the government gets into the business of insuring the private sector that is in there for profit. That would be wrong.

I am simply saying that we have a fundamental problem with not-for-profit organisations that are providing great recreational sporting services and services that are vital to the wellbeing of the community. This would allow, as a first choice, those organisations to go to what was known as SAICORP—it has changed its name now as it has come under new management authorities; but effectively it is what we knew as the South Australian Insurance Corporation, government owned. It would give those people a chance to say, 'This is the sporting or volunteer organisation I represent,' Trees for Life as an example, 'what premium can the government offer?'

I think that would put a lot of pressure back on the private sector to clean up its act. I have thought about this since way back in 2002. I did not put it up at that time in another place because the Treasurer indicated that he had things under control. Here we are now, seven years later, and they are not under control at all. I am sick and tired of decent South Australian volunteers trying to do the right thing for our community who are getting done over by ridiculous insurance premiums. I see this as part of the core business of government, that is, providing an insurance opportunity for not-for-profit organisations that, at the end of the day, are often providing services from which governments today have withdrawn or which they are not providing. I therefore commend this amendment to the committee.

The Hon. G.E. GAGO: The government opposes this amendment. The Government Financing Authority Act is administered by the Treasurer. The Department of Treasury and Finance advises that, apart from a small number of cases where organisations are involved in service delivery activities funded by the state government, it is not current policy to insure risks outside the public sector. Consistent with this, the government does not believe that amending section 11(1)(d) in the manner proposed is appropriate for extending or clarifying SAFA's functions to provide this type of insurance.

The government believes that section 11(1)(d) should be left in its current form for the purposes of addressing circumstances determined by the Treasurer to be appropriate as and when they arise and without interfering or constraining the nature of the activities which the Treasurer should or should not determine to be in the interests of the state. The insertion of this specific example as to the use of section 11(1)(d) will do this, implying that the Treasurer will or should extend SAFA's functions so as to become an insurer of first choice for not-for-profit bodies generally, and certainly it is not the government's intention to do so. The government therefore opposes this amendment.

The Hon. R.L. BROKENSHIRE: Will the minister explain to me why some chosen not-for-profit organisations—and I do not care whether it is one, two or 50—do get the benefit of insuring through SAICORP? Who is the judge on making the decisions that a few groups are eligible but the rest can take a running jump and have to go out into the private market and be done over?

The Hon. G.E. GAGO: It would be Treasury.

The Hon. M. PARNELL: I am very attracted to this amendment, but I am not entirely sure of its consequences. By including these words, which talk about the state insurer acting as an insurer of first choice, does this amendment oblige them to act generally as an insurer of first choice for all not-for-profit organisations or does it simply not shut the door on that happening?

The Hon. R.L. BROKENSHIRE: My understanding of the drafting of this amendment is that it gives the government insurance company the opportunity to open the door. As a first choice those not-for-profit organisations that are struggling with high premiums can go to the government through SAICORP (or its new name) and say, 'This is the service I provide; what is the premium?' It is opening a door for an alternative opportunity to the private sector and I believe that it puts pressure back on the private sector to show a bit of decency when it comes to some of the exorbitant premiums confronting the organisations which are providing services to the community.

The Hon. DAVID WINDERLICH: I support the amendment. This legislation is complex and there has been some great effort applied to understanding it and explaining it tonight, but most of the discussion has been irrelevant in relation to the community sector and small private organisations that offer some of the high risk activities, such as horse riding, and so forth.

This amendment is the only amendment that gets to the heart of the issue; that is, the benefits provided by these community organisations accrue to us all because they provide opportunities for the community, individuals and young people to develop by taking risks. Those opportunities are valuable to the entire community. We all get the benefits of the services these people provide, but the risks fall narrowly on the service providers, even though the rest of us benefit from their activities and services.

This amendment is the only one that addresses that fundamental issue. Everything else I have heard tonight has been an assertion made without evidence. There is no evidence that any of the amendments that have been moved will improve the situation. There is absolutely no evidence that somehow insurance premiums will drop as a result of the amendments moved by the opposition.

The central issue is that the benefits fall to us all and they fall widely, but the risks are concentrated on the service providers. This is the only amendment that attempts to address that situation and, therefore, I support it.

The Hon. R.D. LAWSON: I, too, have some sympathy for what the honourable member seeks to achieve here. I am not surprised that the government has adopted the attitude that the financing authority would not be interested in conducting this sort of business. It seems to me that the real weakness of the proposal is that the expression 'acting as an insurer of first choice' sounds good, but it is actually acting as the insurer of last resort for persons who supply goods and services on a not-for-profit basis.

Without some indication that the Treasurer would be interested in actually providing this service at a cost that would be affordable, clearly with the attitude expressed by the minister, Treasury, if it was required to engage in this business, would simply offer it at a higher rate or at the same rate that current insurers are offering and it would be to little avail.

I also take up the point made by the Hon. David Winderlich a moment ago. This is only available to those organisations who provide services on a not-for-profit basis. The principal opponents of the current regime have been the private providers of horse riding services and the private providers of recreational services; and there are as many private providers as there are public providers. I readily admit there are some, like the boy scouts association, for example, which are conducted on a non-for-profit basis, but I also cannot see the equity in allowing this form of insurance—if, indeed, it were to be allowed—to be available only to the not-for-profit sector. There is nothing wrong, in my view, with people providing recreational services with a view to making a profit; conducting a business. That is an entirely legitimate exercise, and I do not believe they should be excluded from an opportunity of this kind. Personally, they are the reasons why I would not support this amendment.

The Hon. M. PARNELL: Having heard the debate, I support the amendment. I perhaps would not do so if the intent of the amendment was to open up an insurance opportunity that had only ever been used by government activities but, as the minister said, if it is already able to be used by groups that are funded by the state government, then we could extend it to groups that are part-funded. We could make it an extension of the government's own volunteering support programs, because these non-profit organisations rely very heavily on volunteers.

I am not persuaded by the Hon. Robert Lawson's argument that somehow we need a level playing field between profit and non-profit providers. I am more than happy to give a leg up to the non-profit sector—groups such as the scouts—and, if this government insurance is already available to some non-profit organisations, let us keep the door open. I guess my support for it is on the basis that it does no harm. I do accept that the Treasurer's attitude may be that if they do not want this clientele they will make the premiums so high that no-one in the non-profit sector will choose to use the government service because it is more expensive, yet I am more than happy to keep the door open.

The Hon. DAVID WINDERLICH: I think the Hon. Robert Lawson makes a fair point. There are private organisations that offer these services and they can be valuable, too, and, indeed, the lines between profit and not-for-profit can blur—they can overlap quite a lot. You can have ostensibly profit-driven organisations that are effectively community organisations. That is the reality. However, I think this amendment represents some progress. It is not perfect and we need to do more, but it feels to me that it is at least a step towards fixing this issue, which is really an issue about insurance.

I note that SAPOL has an agreement with Neighbourhood Watch whereby Neighbourhood Watch volunteers are insured by SAPOL. So, there are examples of this sort of thing around already, and there are probably more if we care to look. I think there is progress in this debate. Most of the amendments tonight I do not think took us anywhere—I think we were playing with fig leaves. I think this one takes us somewhere and might actually improve the situation for at least the community sector organisations, and that will be of benefit to all of us.

The Hon. A. BRESSINGTON: I rise to indicate that I also support this amendment. I come from the non-government sector and, in 2002 when this public liability crisis took hold on the non-government sector, it was the arrangement for non-government with government insurance that basically saved our bacon and allowed us to continue to keep the doors open. It was a valuable rescue, I might say, and it ended up saving us—when I say 'us' I mean the organisation I previously worked for—a great deal of angst and heartache that the government provided this opportunity to our organisation as a state-funded organisation. So I believe that this amendment would go a long way, as other members have said, to partly solving this particular problem for not-for-profit services, and I support the amendment.

The committee divided on the new clause:

AYES (5)
Bressington, A. Brokenshire, R.L. (teller) Hood, D.G.E.
Parnell, M. Winderlich, D.N.
NOES (16)
Darley, J.A. Dawkins, J.S.L. Finnigan, B.V.
Gago, G.E. (teller) Gazzola, J.M. Holloway, P.
Hunter, I.K. Lawson, R.D. Lensink, J.M.A.
Lucas, R.I. Ridgway, D.W. Schaefer, C.V.
Stephens, T.J. Wade, S.G. Wortley, R.P.
Zollo, C.

Majority of 11 for the noes.

New clause thus negatived.

Remaining clauses (46 to 59) and title passed.

Bill reported with amendments.

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