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Legislative Assembly for the ACT: 1998 Week 7 Hansard (22 September) . . Page.. 1998 ..

MR HUMPHRIES (continuing):

The amount that each insurance company contributes towards that $10m is based on the number of policies it writes, in effect, or the proportion of the market that it has in the ACT. I think that explains the reference Mr Kaine made to property within the ACT.

But there is no requirement in the legislation, as I last read it, to suggest that you have to necessarily translate the levy on the insurance companies into a levy on a particular property that might be retained in the ACT, upon which a calculation is based, as to the share of each insurance company of that $10m.

Now, if the insurance companies decide not to levy motor vehicles or any other part of their enterprise, that is entirely up to them. The amount of $10m spread across an entire industry could be a relatively small amount for each particular player in the industry. In some cases they could well decide to simply pass on the cost to their shareholders, take it out of their annual profits, or rest it on one particular area of business that they might happen to write. I think Mr Kaine should go back and read the legislation. I do not believe it requires anywhere that a particular part of their business, a particular part of their policy writing, should bear any burden of this insurance levy.

MR KAINE: Mr Speaker, I ask a supplementary question. I am sure I am no clearer on what is encompassed with this Act than the insurance companies are, because Mr Humphries says - and I am coming to my question - that motor vehicles are not included and the insurance companies believe that they are. Will the Minister take steps to make sure that all of those affected by this new Act know clearly and without any equivocation whatsoever what they are expected to pay this levy on - because I do not think I know and the Minister's answer does not help me?

MR HUMPHRIES: Mr Speaker, my answer is not what Mr Kaine needs to rely on. He has to rely on the legislation which he saw, like everybody else in this chamber, which he read and which is perfectly clear. Indeed, it is based almost entirely on the New South Wales legislation which has been in force now for some years. So if you or the insurance companies are in any doubt about the way it operates, I suggest that someone is closing their eyes deliberately to what is the reality of a system which is not only quite clear but also operational just across the border and has been for a number of years.

The insurance industry has been mounting a campaign against this levy based on misinformation. I can understand why members of the public might be sucked in by that, why they might be misled by the sort of campaign that the insurance industry is running, but there is no excuse really for members of the Assembly to be similarly misled about that. The legislation is quite clear. It makes it clear what the obligations are. I go back to the comment by Mr Quinlan just after the budget was brought down that it is only fair that we make sure our revenue effort in the ACT replicates that in New South Wales and is of the same standard as that in New South Wales. Once we get that clear I think the insurance industry ought to simply sit down and shoulder its burden in exactly the same way as it does in New South Wales.

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