Murray Watt (Queensland, Australian Labor Party, Shadow Minister for Northern Australia) | Hansard source

I'd like to make a contribution on what is a really important piece of legislation, particularly for people in North Queensland, who have suffered under astronomical insurance premiums over recent years and who have been waiting very patiently for nearly 10 years for this government to do anything about it.

Before I get into the substance of the Treasury Laws Amendment (Cyclone and Flood Damage Reinsurance Pool) Bill 2022, though, I do want to pick up on some of the comments that Senator Bragg just made. I was concerned to hear what he said, and I'd invite the minister to address this when she wraps up. What I think I heard Senator Bragg say was that the reinsurance pool should not be a permanent feature of the insurance system for North Queenslanders. I'm wondering whether Senator Bragg is suggesting that at some future point the government will remove the reinsurance pool. That is certainly not what people in North Queensland have been told by this government; they have been assured by this government that this reinsurance pool will be around for a long time to come and will save them money. To hear a Liberal senator now question whether this is something that should remain in place I think would be quite worrying to people in North Queensland, and it certainly goes against what several ministers of this government have spent months telling people in North Queensland. So, as I said, I invite the minister, in her summing up, to comment on what Senator Bragg said and whether in fact this is just an election manoeuvre from the government and something that they will withdraw at a future date if they are re-elected.

I'll now turn to the bill itself and what it seeks to do. As I said, I do not need to be persuaded one little bit that insurance premiums and insurance availability are a genuine problem for people, particularly in North Queensland. It's increasingly a problem in other parts of the country as we face more frequent and more intense natural disasters which, as much as this government might not want to admit it, are a direct consequence of climate change. We know that if we're just prepared to listen to any reputable scientist they will tell us climate change will be driving more frequent and more intense natural disasters in the future. The fact that many people across the country, particularly in North Queensland, cannot afford insurance currently or obtain insurance currently is extremely worrying when we think that we're likely to see more natural disasters in the future.

I don't have the figures before me about the premium rises, but I know from having spoken to homeowners, businesses, community organisations and others across North Queensland that it is becoming increasingly difficult even to get insurance, as a result of the heightened risk of cyclones, floods and other natural disasters. For those people who are fortunate enough to be able to obtain insurance, the sums of money that they have to pay are, frankly, beyond most working families' budgets. And they're getting worse, with premiums increasing exponentially year after year.

As I said, this is something that the government has been promising to fix for at least 10 years. Warren Entsch, the member for Leichhardt, has been in this parliament for the best part of 25 years, and for the best part of 25 years he has been promising people in his electorate he'll do something about insurance premiums. For all the time that he has been here all that has happened is that the insurance situation in North Queensland has got worse. So in his nearly 25 years in parliament he has not delivered on his promises to do something about insurance premiums and availability. The same goes for the member for Herbert, Phil Thompson; the member for Dawson, George Christensen; and senators from North Queensland. They have spent so much time promising to do something about insurance premiums and availability in North Queensland and have done so little. Now, on the eve of an election, literally in the last couple of sitting days before an election, all of a sudden they rush some legislation into parliament to establish a reinsurance pool and they're making more promises to North Queenslanders that this is going to be the fix.

As I say, Labor is going to be supporting this bill. We absolutely recognise the problem that people in North Queensland are experiencing when it comes to insurance and we support anything this government is prepared to do to do something about it. We're pleased that finally the government is doing something which might offer some relief. As I say, it's just disappointing that it has taken nearly 10 years and an imminent election before we've seen any action from this government.

The government has had ample opportunity to do something about this. We have had inquiry after inquiry throughout this government's life, which have pointed to the problems in the insurance market in North Queensland and have put forward recommendations, but nothing has been done. Most recently, we saw another ACCC inquiry into the matter. It made dozens of recommendations about what could be done to improve insurance availability and price for North Queenslanders. You'll be shocked to know that this report is still sitting on the shelf, along with every other one that this government has commissioned—not acting on those recommendations.

It goes beyond taking legislative or other steps in relation to insurance that this government's failure to deal with this problem is truly evident. It also goes to the matter of disaster mitigation. If you talk to any of the insurers who cover the North Queensland market or those who have been chased out of the market because it's just not viable for them to insure people, if you talk to any local governments in North Queensland, if you talk to businesses in North Queensland, if you talk to home owners in North Queensland—if you bother to speak to anyone in North Queensland—what they tell you, as they have told me, is that the best thing this government can do to reduce the risk of damage to homes and businesses from natural disasters is to invest in disaster mitigation. The reason that matters is that, if you can bring down the risk of damage to homes, businesses and other things by investing in disaster mitigation, that reduces the risk for insurers, that reduces the premiums.

There are examples all across Queensland already that we can point to where investment in disaster mitigation has brought down premiums. I know Senator Chisholm has spent some time around Roma inspecting the flood levy there. I think he was there with the member for Kingsford Smith, Matt Thistlethwaite, a little while back looking at the flood levy there. Again, I can't remember the figures—Senator Chisholm might have them—but the fact that a flood levy was built in Roma has significantly reduced insurance premiums for people in that area, which tends to get floods on a regular basis, so investment in disaster mitigation works. It saves people's lives, it saves their properties, it saves taxpayers the billions of dollars in repair costs after natural disasters and it can actually put some controls around spiralling insurance premiums.

Yet, despite all of that—despite report after report, stakeholder after stakeholder, insurer after insurer, local government after local government saying that we need this government to invest in mitigation—instead what we've seen from this government is the world's biggest piggy bank, otherwise known as the Emergency Response Fund. It's a fund that was set-up by this government three years ago with, at the time, about $4 billion in it. As is often said by the government, yes, Labor did vote with the government for that legislation. We did vote to create the Emergency Response Fund because we thought it was a good idea for the government to put money aside to invest in disaster mitigation and to have at hand for disaster recovery. But, as I think all of Australia has now learnt after the tragic floods in northern New South Wales, the Emergency Response Fund has now been going for three disaster seasons and this government has still not spent a cent from that fund on disaster recovery. They haven't even started building a single disaster mitigation project from that fund, let alone completed one.

The one thing they have done with that fund is earn themselves a tidy $830 million in interest. That fund was established to assist Australians with disaster recovery and disaster mitigation. It could've been used to build the flood levies, the drainage improvements, the bushfire evacuation centres, the firebreaks, the telecommunications improvements—all the kinds of things that we know keep people safe in a disaster and can actually make a practical difference to insurance premiums. It could have been used for those purposes, but instead it just sat there, earning interest for the government and making their own bottom line look better.

Whether it be the ACCC report, the numerous other inquiries that have recommended changes to insurance to look after North Queenslanders or investing in disaster mitigation, this government has failed over and over again. They—led by Mr Entsch, the member for Leichhardt, but the others are just the same—make promise after promise after promise to do something about insurance, but when it comes to action it's failure after failure after failure. So now, two sitting days before an election, the government has finally decided to do something. Let's hope it works. Let's hope that this reinsurance pool works. Labor are backing it because we want to give it a chance to work. We're just so happy to see the government do anything at all that might make a difference to insurance premiums in North Queensland.

I have to say that this government's track record makes us very sceptical about what difference this will actually make in practice. That scepticism is only heightened when we see the way the government has behaved around the claims it has been making about the savings that will be generated from this reinsurance pool. Several weeks ago the government put out a press release claiming that it had modelling that showed that the reinsurance pool would deliver massive savings to people in North Queensland. That was what got reported in the media, but look at the press release that the minister put out at the time—and this was a few weeks ago. It always pays to look at the fine print when it comes to the Morrison government. The press release said that it was only 'homeowners in northern Australia with the most acute cost pressures' who would be expected to benefit from up to 46 per cent premium discounts.

We asked about this at estimates. I know Senator Chisholm asked about this at the Senate inquiry into this bill as well. We were trying to establish who we are talking about when we say 'homeowners in northern Australia with the most acute cost pressures'. Is that five people in northern Australia who might benefit from this? Is it 500? Is it 5,000? You're out there making the claim that this is going to save people a lot of money, but how many people are we actually talking about? We couldn't get answers from the government about that. I flag to the minister that we will be asking those questions again in this debate.

When we asked about this at estimates we asked to see this magic modelling that tells us that people are going to be saving up to 46 per cent. Minister Hume, who was there at the table, said: 'No. We can't release the modelling, because it's not in the public interest.' How arrogant of this government to say to North Queenslanders: 'We're going to save you all this money with this reinsurance pool, even though we've done nothing for 10 years. Vote for us again and you'll get some savings, but we won't show you how much and we won't show you any of the proof we've got that backs up our claims.' Do you know what was worse? Minister Hume said it was not in the public interest for North Queenslanders to see that modelling. How arrogant! North Queenslanders apparently can't be trusted by this government to see the modelling the government claims it has that backs up its claims about how much people will save.

I still want to know from this government how much the average homeowner in North Queensland will save from this reinsurance pool and how many people will actually save 46 per cent. Is this just more misleading tripe from a government that has spent 10 years doing absolutely nothing to fix the insurance crisis in North Queensland? I foreshadow that I will move a second reading amendment that seeks to obtain that modelling.

There are numerous other issues. In the very little time I've left I want to address the Greens amendment that seeks to extend this reinsurance pool to flooding in other regions. We think this is an idea worth considering, but the Greens have dropped this on the eve of this debate, with no information about what it will cost taxpayers and what impact it will have on premiums. We think this should be considered as part of the review of this legislation going forward.