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Legislative Council - Fifty-Second Parliament, Second Session (52-2)
2013-05-15 Daily Xml
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MOTOR VEHICLE ACCIDENTS (LIFETIME SUPPORT SCHEME) BILL

Committee Stage

Bill recommitted.

Schedule 2.

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

Clause 3, page 37, after line 16—Insert:

(4a) However, a court may award damages for non-economic loss in a case that would otherwise be excluded by operation of subsection (4) if satisfied—

(a) that the consequences of the personal injury with respect to non-economic loss are exceptional when judged by comparison with other cases involving the same injury; and

(b) that the application of the threshold set by that subsection would, in the circumstances of the particular case, be harsh and unjust.

(4b) An assessment of damages for non-economic loss under subsection (4a) must be based on an injury scale value that should rarely be more than 25 per cent higher than the injury scale value that applies under subsection (3)(a) in relation to the injury.

This is an alternative to my previous amendment. It provides the court with the discretion to award damages for non-economic loss in cases that would otherwise be excluded if the consequences of the personal injuries sustained are exceptional when judged by comparison with other cases involving the same injury and the application of the ISV chart threshold would be harsh and unjust. The only proviso to this is that an assessment of damages for non-economic loss must be based on an injury scale value that should rarely be more than 25 per cent higher than the injury scale. The reason for this relates to the government's concerns over situations where a court exercises its discretion to award damages for injuries that would otherwise fall below the scale that are exorbitantly in excess of what another person would get in accordance with the scale itself.

As mentioned earlier, this amendment is consistent with the Hon. Tammy Franks' amendment in relation to economic loss. When dealing with my first amendment, the government indicated its preference for the Hon. Tammy Franks' amendment on the basis that it provides a much clearer test to protect against injustices caused by rigid application of the threshold test in relation to a person's future earning capacity. Whilst this is by no means my preferred position, we are basically at the point where some exception to the general rule, no matter how watered down it is, is better than what the government is proposing.

I remind members that the amendment reads that, and I quote, 'an assessment of damages for non-economic loss must be based on an injury scale value that should rarely be more than 25 per cent higher than the injury scale'. That does not mean that it can never exceed 25 per cent. In those cases where the consequences of the person's injuries are exceptional and the application of the ISV chart threshold would be harsh and unjust, the court is still well within its rights to award damages for non-economic loss over and above the 25 per cent. The question would come down to the individual circumstances of the case.

In closing, I have to express my disappointment with the way the government has handled this bill. Members of this chamber have effectively been backed into a corner and forced to make decisions on the run, which will have huge ramifications for persons injured in motor vehicle collisions. We have been asked to make decisions based on information that has been provided at the eleventh hour with very little opportunity for detailed and considered deliberation.

The ISV table draft, which is some 66 pages long and critical to the scheme, was provided to honourable members at 7.48 on Monday evening. I accept that the revised draft is a far cry better than the original draft, but it is still very unclear as to how it will apply with respect to many injuries that people sustain in motor vehicle collisions. In effect, what the government is saying is, 'Trust us. We've listened and dealt with all of the concerns raised by the legal profession and by members of parliament, and everything will be fine. If not, you can always move to disallow the regulations.' With respect, I think that this is a bad way of dealing with legislation, particularly when it is as important as this.

The bill will change and affect every person involved in a motor vehicle collision. It will, through the introduction of thresholds, reduce the number of people who will be able to avail themselves of compensation through negotiation, pursuant to essentially what is a common law scheme modified by statute over time and, in areas of dispute, determined independently by a court. The legal profession, although unable to speak openly, has done its absolute best and it is still trying to salvage some of those rights by negotiating the least draconian provisions out of what can be described only as draconian legislation.

Those negotiations have been ongoing throughout this whole debate. Rather than having the debate first, reaching a final position in relation to the negotiations and introducing into this place a position that is agreed to by all parties, the government is asking us to simply press ahead and that, if we choose not to do so, we run the risk of being outed as the member who chose not to support a $100 reduction in CTP premiums—never mind that this reduction will be a one-off that will last for only 12 months. This is what the bill is really about; it has absolutely nothing to do with the merits of the legislation we are debating.

This bill will result in the diminution of a person's ability to seek appropriate compensation for at-fault accidents; there is no question about that. Damages for non-economic loss, economic loss and gratuitous services have all been in the firing line. Again, for the record, I support wholeheartedly the introduction of a lifetime support scheme, but this should not come at the expense of existing entitlements. We should not be forced to choose between the two.

I have to say that I think this is a very sad day for justice in this state. Whether or not this bill passes today or tomorrow, the outcome, in my view, would still be the same. We are essentially trying to claw back some of the entitlements the government has ripped away from injured persons. Do I think that it is a good outcome? Save and except for the lifetime support scheme, it is a far cry better than what the bill looked like originally but, no, I do not think it is a good outcome. However, I committed to dealing with the bill this week on the basis that we get something more than we would otherwise get for those injured persons. I commend this amendment to the committee.

The Hon. I.K. HUNTER: The Hon. John Darley's amendment will give the courts a discretion to award damages for non-economic loss, that is, damages for pain and suffering in a case in which the plaintiff's injuries are assessed on the injury scale values being below the statutory threshold. The court would have to be satisfied that the consequences of the injury with respect to non-economic loss are exceptional when judged in comparison with other cases involving the same injury and also that the application of the threshold would be harsh and unjust in that case. If the court is so satisfied, it can assess the damages as if the injury had been assessed at a higher ISV. However, the increase is rarely to be more than 25 per cent higher than the assessed ISV.

The government has obtained actuarial advice from the Motor Accident Commission's actuary about what effect this amendment would have on premiums. The opinion is that it would not impact on the recommended premium, based on the assumption that waiver of the threshold will occur infrequently and that there is no unexpected interpretation by the courts. The government has already today voted in favour of an amendment by the Hon. Tammy Franks to insert into the bill a review clause that will require a review after three years. On that basis, the government will support the amendment in the knowledge that any unexpected consequences of this amendment will be subject to review.

If the three-year review identifies that there are problems, or if it becomes apparent before that that this amendment has caused unexpected pressure on the CTP fund, the government reserves the right to seek to have the provision repealed or amended.

The Hon. R.I. LUCAS: Can the minister indicate for the sake of the record what was the actuarial advice in relation to the Hon. Tammy Franks' amendment? I assume it was exactly the same.

The Hon. I.K. HUNTER: I am advised that the actuary's advice is as per the letters sent to members of the Legislative Council, that is, if interpreted very broadly it may lead to an increase of up to $3 per vehicle, but he believes that is very unlikely.

The Hon. R.I. LUCAS: Just to that end, I seek leave to table a copy of the advice provided to the government on related issues. The government provided me with a copy of this advice and I think it provided it to the Economic and Finance Committee, which is the costings for proposed tort reform. I seek leave to table that advice.

Leave granted.

The Hon. R.I. LUCAS: I did that on the basis that I think it is useful for all members of the committee and those who follow us to at least see part of the actuarial advice that has been provided to the government in relation to this. The minister has just placed on the record further advice in relation to the Hon. Ms Franks' amendment and the Hon. Mr Darley's amendment. I repeat again the comments I made earlier in relation to this particular amendment, and that is that my experience in relation to these things is that invariably they end up differently to the way lawyers and actuaries predict and that inevitably future parliaments and governments come back to have a look at these particular issues and say, 'Hey, it wasn't exactly as we intended.'

I noted the words from the minister's advice that he put on the record. It was something like, 'unless there are unexpected legal interpretations', or words to that effect. Again, I just place on the record that in my experience in relation to these issues the unexpected tends to be more the norm rather than the unexpected. I expect or suspect that a re-elected Labor government or a re-elected Jay Weatherill government, I should say, rather than a Labor government, or a newly elected Liberal government will have to revisit these particular issues because the advice is going to come back saying, 'Look, there were these unexpected legal interpretations by the lawyers and the courts in relation to these issues.'

The opposition's position is that we are very significantly hamstrung in relation to this issue. We do not have direct access to the actuary so that we can actually quiz them and ask them to pursue particular issues; what their assumptions are. I note in this advice that I have tabled that Brett and Watson say that these costings incorporate some changes to assumptions that have resulted from the merging experience of the scheme since the costings of the white paper were undertaken, but do not indicate what those changed assumptions were. I put a request to the minister not to delay the proceedings today, as to whether he is prepared to give an undertaking to provide advice to myself after the passage of the bill and as to what were the changes to assumptions that Brett and Watson and/or the government have made in relation to the costings for proposed tort reforms. As I said, I do not do that to delay the debate here, but I ask whether the minister is prepared to give an undertaking as to what those changes in assumptions have been.

As I said, we are largely hamstrung. We are not in a position to quiz the actuaries. The government gets the advice. The government gets the detailed legal advice and we are left in a position of having to respond by either accepting or not accepting the advice the government has received on those issues.

In relation to the Hon. Mr Darley's amendment, we are further hamstrung in that it was moved at 11.30 this morning and, at 5.30 this afternoon, we are voting on it. The government has now indicated it is supporting the Hon. Mr Darley's amendment. Our understanding is that other minor party and crossbench members are supporting the amendment so that the Hon. Mr Darley has the necessary support in the committee to see this progress, so we will not oppose it. We do not have enough evidence to oppose it. The numbers are there so, as I said, we will not be opposing or calling 'divide' in relation to this particular amendment.

I place again on the record, however, my concerns at these and related amendments and their potential impact on the scheme. I seek an undertaking from the minister as to whether he is prepared, after the passage of the bill, to correspond and provide an answer to the question I put.

The Hon. I.K. HUNTER: I thank the honourable member for his contribution. I think the most I can say is I will take advice on that and come back to Mr Lucas with a response.

Amendment carried; schedule as amended passed.

Bill reported with amendment.

Third Reading

The Hon. I.K. HUNTER (Minister for Sustainability, Environment and Conservation, Minister for Water and the River Murray, Minister for Aboriginal Affairs and Reconciliation) (17:46): I move:

That this bill be now read a third time.

If I can take a moment of the chamber's time, I would like to thank honourable members for their contribution to the debate on this bill. In particular, I thank members for their bipartisan or multipartisan support for the introduction of the new lifetime support scheme.

From 1 July 2014, people who are in the unfortunate situation of being catastrophically injured in motor vehicle accidents in South Australia will benefit from comprehensive lifetime treatment, care and support. They and their families will be grateful for this parliament's efforts to put in place a scheme that will assist them from the moment they are injured in a vehicle accident and on the subsequent journey to rehabilitate themselves and maintain independent and dignified roles in the community, notwithstanding their injuries.

The reforms to the compulsory third-party insurance scheme have not been universally supported by members and the government understands the differing views that members hold in relation to these reforms. Ultimately however, this is a compulsory form of insurance for all South Australian motorists and we need to strike the right balance between compensating people for the effects of a motor vehicle accident injury and the need to ensure that the compulsory insurance premium charge to motorists is not excessive. This legislation tackles this problem by reducing damages paid out for minor injuries. However, it is critical to remember that no-one will lose a right they have now to receive compensation for medical treatment to help them heal from the accident.

Over recent years, we have witnessed rapid growth in CTP premiums, and the government reached the view that the scheme was not only becoming expensive it was not delivering value for money for South Australian motorists. The reforms will mean that all people who pay a CTP premium will receive a 20 per cent reduction next financial year and, after the lifetime support scheme commences, the combined CTP premium and lifetime support scheme levy will still see motorists experiencing cheaper registration costs than they do now.

These are far-reaching reforms and it will be important that the effect of the scheme on injured motorists is monitored. The Hon. Tammy Franks' amendment has ensured that the parliament will conduct a review in three years' time. The Hon. Tammy Franks, the Hon. Ann Bressington and the Hon. John Darley have all moved amendments to the bill, which the government has supported, and I thank those members for their efforts to work with the government to improve the legislation. I thank all members for accommodating the government's timetable in relation to the bill.

Finally, I would like to acknowledge the efforts of my colleague the Minister for Health and Ageing (the Hon. Jack Snelling from the other place) for his strong leadership and vision in championing these reforms. Without such a passionate advocate for a no-fault scheme, these reforms would not have succeeded. I would also like to thank most sincerely my advisers—Ms Lois Boswell, Mr Stuart Hocking and Ms Di Gray—for their efforts in bringing me up to speed and allowing me to take this passage of the bill through the house.

The council divided on the third reading:

AYES (18)
Brokenshire, R.L. Darley, J.A. Dawkins, J.S.L.
Finnigan, B.V. Franks, T.A. Gago, G.E.
Hood, D.G.E. Hunter, I.K. (teller) Kandelaars, G.A.
Lee, J.S. Lensink, J.M.A. Lucas, R.I.
Maher, K.J. Parnell, M. Ridgway, D.W.
Stephens, T.J. Wade, S.G. Wortley, R.P.
NOES (2)
Bressington, A. (teller) Vincent, K.L.

Majority of 16 for the ayes.

Third reading thus carried.

Bill passed.

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