Kevin Andrews (Menzies, Liberal Party, Shadow Minister for Families, Housing and Human Services) Share this | Hansard source

As the Minister for Families, Housing, Community Services and Indigenous Affairs has indicated, this bill has come back from the Senate with schedule 4 withdrawn. That schedule would have had significant implications for the regulation of insurance and compensation payments and would have thrown Commonwealth law into direct conflict with the laws of the states and territories. Indeed, this was something which I raised in the debate when the bill was in the House previously, and the parliamentary secretary—I do not think the minister was present on that occasion—assured me that the amendments the government was then moving would address the issues that the insurance industry had in relation to the bill. It turns out that those amendments did not address those issues, and that has been disclosed in evidence before the Senate.

Schedule 4 in the form in which it is currently drafted would require that compensation payers advise Centrelink of information on the payment of any compensation under an injury compensation scheme or insurance contract in advance of the payment occurring. The submissions received during the Senate inquiry make it clear that schedule 4 would place a signifi­cant administrative and financial burden on insurance companies as well as on government agencies. It is also clear that a burden would also be borne by the wider business community, including small and medium businesses and non-government charity and not-for-profit groups. In their submission to the inquiry, for example, the Allianz company outlined the scope of notifications that would be required under the legislation. According to their subm­ission, some of the payments that would be required to be reported included past economic loss, future economic loss, gratuitous care, general damages, compen­sation for relatives, funeral expenses, and medical and related expenses. Were schedule 4 passed in its current form it would cause financial hardship to those recipients of injury compensation, including their families. Under the provisions of the bill it is not only individual Centrelink payments that would be affected but also those such as carer and family payments. As a result, the impact extends beyond any one person. Of particular concern to the coalition was the potential cost to industry if the legislation in its current form were to be enacted. According to one submission to the Senate inquiry, the cost would be tens of millions of dollars. Indeed, Allianz submitted:

The administrative and financial burdens on workers compensation payers if this were the case would be significant, amounting to over $100 million per annum just in the wage costs of additional staff that would be required to meet the Bill's proposed notification requirements.

Also of concern was the time impact on the organisation, as Allianz further submitted:

If it took 15 minutes to complete the notification for each payment, the estimated number of hours required to provide such notifications in relation to workers compensation payments alone would be 5.35 million hours.

I note that the Commonwealth's own insurer, Comcare, in evidence to the Senate raised similar concerns in relation to the unworkability, in effect, and the enormous expense that the schedule in its current form would have imposed upon insurers and therefore upon the community generally. So the coalition is pleased that the government has noted these concerns and has decided to split schedule 4 from the bill. We look forward to the way in which, I presume, the minister will look at these concerns that the insurance industry has raised, and we will look at the detail of any further proposal that comes before the parliament.

Question agreed to.

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