Page 4173 - Week 14 - Wednesday, 23 October 1991
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So, the projections of very difficult times for insurers have not occurred, as a result of both increased road safety, for which governments can take credit, and better practices in relation to fraudulent claims, for which essentially the NRMA can take credit.
So, this has happened despite advice to government on the appropriate level of premium, and it was advice that came to government, it must be said, from a community committee. There has been for many years a third-party insurance premium advisory committee in this Territory, which has been chaired for many years by Mr Barry Reid. It has a number of community representatives on it, including Mr De Domenico, who I notice is seeking public office in the Territory for the Liberal Party. It also has some NRMA representatives and some government representatives. That committee over the years has looked at what should be an economic premium. But, because of the reduction in the number of claims and the holding steady of the pay-out per claim, those projections have been shown to be incorrect, and the NRMA has made a quite substantial profit.
Unique amongst business enterprises, the NRMA brought this profit to the attention of ACT authorities, and offered up negotiations to enter into a profit share arrangement. That first occurred in 1989, and this was brought to the attention of my predecessor Mrs Grassby. She set in train a process of negotiation. Like a lot of things, it started with action under the previous Labor Government; then there was a period of perhaps little happening; and now it is being brought to a successful conclusion.
Be that as it may, the point remains that after the 1980s - referred to by commentators as the decade of greed; the era of Wall Street characterised by "greed is good", and "profit is the ultimate ambition of a commercial enterprise" - uniquely, the NRMA has come to government and said, "We have made far more profit out of Territory motorists than we expected, and we are prepared to negotiate with you about putting some of that profit back, not into the pockets of government, not into Consolidated Revenue, but to the motorists".
We would all recall the period in the late 1980s when it seemed that the boom was endless, when corporate profits from year to year were announced at record levels and when banks, manufacturers and insurance companies were all announcing record profits. I do not recall one single solitary instance of a company proudly announcing its record profit and then offering to put some of that money back into the pockets of the community; back into the pockets of the people from whom that profit was made.
So, the NRMA must be congratulated for entering into this initiative. The talks have been fruitful, and we were able to announce a week or so ago what the Government is proposing to do. What the Government is proposing to do, with the NRMA, is indeed, as I announced at the time, good
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