Tony Abbott (Warringah, Liberal Party, Leader of the House) Share this | Hansard source

The sale of Medibank Private is an important topic and I will do my best to do it justice, even though it certainly has not had justice done to it to by the member for Lalor. Let no-one be under any doubt: this government is perfectly upfront and open about its desire to sell Medibank Private. Yes, members opposite can campaign from now until the next election on this issue, if they wish, and we will meet them every step of the way, because this government believes that privatisation is, generally speaking, a good thing where we have government owned enterprises engaging in business in a competitive market. That is why this government believes that Medibank Private ought to be sold; that is why this government believes that Telstra ought to be sold. That is why this government supported members opposite when they were in government when they thought that the Commonwealth Bank should be sold; when they thought that Qantas should be sold; when they thought that TAA, as it then was, should be sold; when they thought that CSL should be sold; and when they thought that Defence Industry should be sold. We supported them because these were all government business entities operating in competitive markets.

Our principle has been absolutely crystal clear from the late 1980s to the present time. We will stand on this principle and on this practice from now right through to the next election and, if we are lucky enough to be returned, we will happily keep standing on this principle for as long as there is breath in this government’s body. There is no deceit, no subterfuge and no confusion. This government believes that Medibank Private should be sold. We think that selling Medibank Private would be good for policyholders, good for taxpayers and good for the health sector generally. That is what we believe.

I am disappointed that the advice we have had from our financial advisers is that it would be best not to sell Medibank Private in close proximity to the sale of Telstra, and that is why we cannot do so until the second half of next year. But, as there will be an election then, we will be precluded from going ahead with this by the caretaker conventions, and that is why it now will not happen until 2008. But let everyone be in no doubt: if this government is returned, there will be a sale of Medibank Private early in 2008. Let there be no doubt about that whatsoever.

I accept that privatisation is often not popular but, unlike members opposite, sheer gutless populism is not the stock in trade of this government. We are prepared to do what we think is right. We accept that the general public might not immediately agree with us, but the fact is that we know, in the end, the public expects governments to make decisions based upon principles, not on sheer gutless populism, which is what we increasingly get from members opposite.

Let me do my best to address some of the specific criticisms that were made by the member for Lalor in her MPI address. She suggests that there was something deceptive about the government’s April announcement that we intended to go ahead with the sale of Medibank Private. I was there with Senator Minchin. This morning I have had drawn to my attention aspects of the transcript, and it was always made crystal clear by Senator Minchin that the government’s first priority was the sale of Telstra and that the sale of Medibank Private was contingent upon the government’s arrangements to sell Telstra, which was our first and foremost priority. We knew we wanted to sell Telstra back then, but no final decision had been made. It is only in the last few weeks and days that we have had advice from our financial advisers that the best and fairest deal for taxpayers and for those who are contemplating buying shares in what are currently government owned or government part-owned entities would be to keep a reasonable distance between these two floats.

The member for Lalor claimed that there was some kind of reprehensible or incompetent confusion as to who owned Medibank Private. There has never been any confusion in the government’s mind. We had clear legal advice from start to finish that we were perfectly entitled to sell Medibank Private and that the government clearly owned Medibank Private. I accept that members opposite, in running the kind of interference that they normally run, sought legal advice of their own. The instant they got that Parliamentary Library advice, we sought through a distinguished city law firm a QC’s advice, which confirmed the original advice that the government had.

The next claim from the member for Lalor is that the government’s strong belief that premiums would be under less pressure in a privatised Medibank Private than is currently the case is laughable. She says, ‘A privatised Medibank Private would inevitably rip the public off through unconscionable increases in premiums.’ The logic of the member for Lalor and some of the people whom she cited was that a private business is always going to be more expensive for purchasers than a government owned business because a government owned business does not have to satisfy, in her mind, the evil profit motive; it does not have to satisfy the need to provide a rate of return on shares. If that is the case, we should nationalise every private business in this country because every private business, according to the member for Lalor’s logic, is ripping off its customers because it is demanding a profit. Would it not be so much better if they were all in government ownership or run by charities or community groups of some sort so that we could dispense with the evil profit motive?

I certainly think there is a place for charities and community based businesses to operate in our market; but there is nothing wrong with the profit motive. The reason why the private sector is so consistently better than government operations at producing goods and services is that the efficiencies that the private sector is capable of enable it to make a profit and deliver the goods and to still do it significantly cheaper than government owned enterprises.

The logic of the member for Lalor, at the very least, would have the Commonwealth Bank renationalised, and then, because the Commonwealth Bank was renationalised, it would have lower interest rates and lower charges than the other banks, so we should nationalise them. Then we would nationalise Qantas and, because it would be so much cheaper to fly in a nationalised Qantas, the opposition would say, ‘Let’s nationalise Virgin and all the other companies currently providing aviation services.’

I know the member for Lalor gets upset when it is said by members of the government that Labor are still socialists at heart, but the truth is that, on the logic that she has put forward today, they must be socialists at heart because, by definition, once the profit motive is involved prices go sky-high. That is the logic that she gave us this afternoon. Of course it is not true, and if it were true—

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