Dr BURNS - 2001-10-18
Can the minister tell the House what the government has done to reduce the burden on Territory businesses from the collapse of HIH Insurance?
ANSWER
I thank the member for Johnston for his question. HIH is another story in the Northern Territory. It is another example of the previous government’s deceit in regards to what they were telling Territorians …
Mr DUNHAM: A point of order, Madam Speaker! Unless this answer can actually demonstrate that, I ask that you ask him to withdraw that word.
Madam SPEAKER: Yes, I think you should withdraw it. Couch it in another term. You cannot throw allegations across the floor without a motion of censure. This was going to be the new raising of debate, right?
Mr HENDERSON: I withdraw, Madam Speaker. I will move on.
The collapse of HIH Insurance, under the watch of the federal Coalition government - which is now the subject of a Royal Commission - has led to an unfunded workers compensation liability in the Northern Territory estimated to be around $50m. Northern Territory employers and workers whose workers compensation policies or claims were with HIH are protected under the Work Health legislation. In this regard, the nominal insurer is established to protect injured workers whose employers do not have workers compensation insurance and protect employers and injured workers where an insurer defaults in the payments of the compensation.
At the time of the HIH collapse in March this year, the funding provisions of the nominal insurer would have required each insurer and self-insurer to contribute according to their market share, which would have placed an enormous burden on those insurers. This could have impacted unfairly on small business if insurers sought to pass on the costs of the levy in an equitable basis. There was also the real possibility that an insurer may have found the levy to be too onerous and chosen to leave the scheme, as many have done over the years, and we have far too few insurance companies offering workers compensation at the moment in the Northern Territory.
The previous government introduced legislation in May to amend the Work Health Act to fund …
Mr Baldwin: Which you supported.
Mr HENDERSON: Yes, I will get to that. … to fund the nominal insurer and yes, we did support that, as the member for Daly correctly states.
The Minister for Industries and Business at the time, the current member for Daly, when introducing the bill stated:
In any event, there will be no levy imposed between now and January 2002, during which time all possible funding options
will be explored.
He said that, and this is where the deception occurred - if I can use the word, Madam Speaker - and I will get to it:
The government has already advanced $3m to the nominal insurer …
Mr Ah Kit: Trickery!
Mr HENDERSON: Trickery - I will withdraw ‘deception’ - trickery.
… has advanced $3m to the nominal insurer to cover claims during the first three months since the HIH collapse.
And he further stated:
We are not about putting undue economic stress on Territory employers and we would make every effort to ensure any
levy is affordable and fair to all employers.
The minister at the time said: ‘We are not about putting undue economic stress on Territory employers’. What the previous government failed to tell Territory business is the advance was, in fact, a loan to be …
Mr Baldwin: You asked me and I told you what it was.
Mr HENDERSON: Yes, but you did not tell business. The Minister for Industries and Business did not tell business.
It was an advance, ‘We kicked the money in’. The Treasurer at the time on ABC stated: ‘We kicked the money in’. Business in the Northern Territory thought: ‘How wonderful, the Northern Territory government has given this money to support injured workers for the next three months’. When we asked for the details about this advance - was it a loan or was it a grant - it comes back, it was a loan.
Mr Reed: Yes.
Mr HENDERSON: That is right, you did not tell business, we had to ask the question. Trickery …
Mr Baldwin: Of course we did.
Mr HENDERSON: Oh no, you didn’t, no you didn’t. Madam Speaker, no he did not. I am sure that the Chamber of Commerce, the Territory Construction Association, the Motor Traders Association …
Members interjecting.
Mr Stirling: Timmy, Timmy!
Mr DUNHAM: A point of order, Madam Speaker! The member for Sanderson is offended by people using first names instead of their electorate, and the Deputy Leader of the Opposition has been calling out the first name of the member.
Mr Stirling: I apologise, Madam Speaker, I will not call him Timmy again.
Madam SPEAKER: I think I am going to have to put a penalty board up here soon. That is about three or four times you have been told about that, so please refrain. Otherwise, I will be putting little ticks against your name.
Mr HENDERSON: Trickery, this is the trickery. When I hit the phones later that afternoon to talk to the major employer groups in the Northern Territory, it was news to them. In the briefings that they had had from the minister in regards to this advance, it was portrayed to them that this was a grant. There was no mention that this would have to be repaid by way of a levy at a later time - with interest. In fact, the TCA went as far as to produce in one of their shortcuts, that this new tax was news to them, at the time. So, here is the trickery of the previous government. This would then have been passed onto consumers with a significant impact on jobs, on investment.
Mr Baldwin: Tell us what you are going to do about it?
Mr HENDERSON: So what have we done? What have we done, is the call from the member for Daly? Well, this new Labor government, within 53 days of coming to office, has said that not only would we grant the $3m, we would grant an additional $6m into the scheme, to provide funding until well into 2002, whilst we look at all options as to how we recover and how we fund the rest of this liability. Within 53 days of coming to government, what this Labor government has done, it has taken a tax off business in the Northern Territory that would have been imposed by the previous government, $9m worth of tax, with interest. That is how we have contributed significantly to business in the first few weeks of our government.
ANSWER
I thank the member for Johnston for his question. HIH is another story in the Northern Territory. It is another example of the previous government’s deceit in regards to what they were telling Territorians …
Mr DUNHAM: A point of order, Madam Speaker! Unless this answer can actually demonstrate that, I ask that you ask him to withdraw that word.
Madam SPEAKER: Yes, I think you should withdraw it. Couch it in another term. You cannot throw allegations across the floor without a motion of censure. This was going to be the new raising of debate, right?
Mr HENDERSON: I withdraw, Madam Speaker. I will move on.
The collapse of HIH Insurance, under the watch of the federal Coalition government - which is now the subject of a Royal Commission - has led to an unfunded workers compensation liability in the Northern Territory estimated to be around $50m. Northern Territory employers and workers whose workers compensation policies or claims were with HIH are protected under the Work Health legislation. In this regard, the nominal insurer is established to protect injured workers whose employers do not have workers compensation insurance and protect employers and injured workers where an insurer defaults in the payments of the compensation.
At the time of the HIH collapse in March this year, the funding provisions of the nominal insurer would have required each insurer and self-insurer to contribute according to their market share, which would have placed an enormous burden on those insurers. This could have impacted unfairly on small business if insurers sought to pass on the costs of the levy in an equitable basis. There was also the real possibility that an insurer may have found the levy to be too onerous and chosen to leave the scheme, as many have done over the years, and we have far too few insurance companies offering workers compensation at the moment in the Northern Territory.
The previous government introduced legislation in May to amend the Work Health Act to fund …
Mr Baldwin: Which you supported.
Mr HENDERSON: Yes, I will get to that. … to fund the nominal insurer and yes, we did support that, as the member for Daly correctly states.
The Minister for Industries and Business at the time, the current member for Daly, when introducing the bill stated:
In any event, there will be no levy imposed between now and January 2002, during which time all possible funding options
will be explored.
He said that, and this is where the deception occurred - if I can use the word, Madam Speaker - and I will get to it:
The government has already advanced $3m to the nominal insurer …
Mr Ah Kit: Trickery!
Mr HENDERSON: Trickery - I will withdraw ‘deception’ - trickery.
… has advanced $3m to the nominal insurer to cover claims during the first three months since the HIH collapse.
And he further stated:
We are not about putting undue economic stress on Territory employers and we would make every effort to ensure any
levy is affordable and fair to all employers.
The minister at the time said: ‘We are not about putting undue economic stress on Territory employers’. What the previous government failed to tell Territory business is the advance was, in fact, a loan to be …
Mr Baldwin: You asked me and I told you what it was.
Mr HENDERSON: Yes, but you did not tell business. The Minister for Industries and Business did not tell business.
It was an advance, ‘We kicked the money in’. The Treasurer at the time on ABC stated: ‘We kicked the money in’. Business in the Northern Territory thought: ‘How wonderful, the Northern Territory government has given this money to support injured workers for the next three months’. When we asked for the details about this advance - was it a loan or was it a grant - it comes back, it was a loan.
Mr Reed: Yes.
Mr HENDERSON: That is right, you did not tell business, we had to ask the question. Trickery …
Mr Baldwin: Of course we did.
Mr HENDERSON: Oh no, you didn’t, no you didn’t. Madam Speaker, no he did not. I am sure that the Chamber of Commerce, the Territory Construction Association, the Motor Traders Association …
Members interjecting.
Mr Stirling: Timmy, Timmy!
Mr DUNHAM: A point of order, Madam Speaker! The member for Sanderson is offended by people using first names instead of their electorate, and the Deputy Leader of the Opposition has been calling out the first name of the member.
Mr Stirling: I apologise, Madam Speaker, I will not call him Timmy again.
Madam SPEAKER: I think I am going to have to put a penalty board up here soon. That is about three or four times you have been told about that, so please refrain. Otherwise, I will be putting little ticks against your name.
Mr HENDERSON: Trickery, this is the trickery. When I hit the phones later that afternoon to talk to the major employer groups in the Northern Territory, it was news to them. In the briefings that they had had from the minister in regards to this advance, it was portrayed to them that this was a grant. There was no mention that this would have to be repaid by way of a levy at a later time - with interest. In fact, the TCA went as far as to produce in one of their shortcuts, that this new tax was news to them, at the time. So, here is the trickery of the previous government. This would then have been passed onto consumers with a significant impact on jobs, on investment.
Mr Baldwin: Tell us what you are going to do about it?
Mr HENDERSON: So what have we done? What have we done, is the call from the member for Daly? Well, this new Labor government, within 53 days of coming to office, has said that not only would we grant the $3m, we would grant an additional $6m into the scheme, to provide funding until well into 2002, whilst we look at all options as to how we recover and how we fund the rest of this liability. Within 53 days of coming to government, what this Labor government has done, it has taken a tax off business in the Northern Territory that would have been imposed by the previous government, $9m worth of tax, with interest. That is how we have contributed significantly to business in the first few weeks of our government.
Last updated: 09 Aug 2016