Nick Minchin (SA, Liberal Party, Minister for Finance and Administration) Share this | Hansard source

I am interested that the Labor Party is now, under its new leadership, so cocky that it says ‘when’ Labor wins the next election. We note that with great interest. We are much more humble and are prepared to concede that it is possible that we could lose the next federal election. But we will be working hard to ensure that that does not occur.

Senator McLucas insisted that this should have been sent to a references committee. I have been wondering whether the Qantas or Commonwealth Bank sale legislation was referred by the then Labor government to a references committee; somehow, I doubt it. It is normal for legislation in this place to be referred to a legislation committee. It is then open to the whole community to submit as many submissions as they like to that committee for it to consider the submissions put before it. This bill has been dealt with in a perfectly normal and appropriate fashion, albeit I note that Senator McLucas is not actually supporting Senator Murray’s amendments.

With respect to Senator Murray’s arguments in relation to his amendments, the government is not in a position to support those amendments. I outlined a number of the reasons for that position in my speech on the second reading. We have thought about Medibank Private for any number of years within the coalition. We do genuinely have an in principle position that modern Western governments should, prima facie, not really be running businesses in competitive industries when they have the role of regulating them. We have been talking about and thinking about Medibank Private for many years and have been generally of the view that there is no public policy case for the government owning a private health insurance business. We have been the ones most profoundly committed to having a viable private health insurance industry, unlike the Labor Party and certainly the Greens. But, given our support for that industry, we do not see the need for the government to own one of those businesses. That has been our strong view.

In the course of our discussions, we have of course talked as a government, and as a coalition, about what the future ownership arrangement should be. After much advice and much consideration, we came to the view that the most appropriate method of sale is a public offering, as was the case with Qantas, the Commonwealth Bank and Telstra—other major government businesses which were properly sold to the Australian public by way of public floats. We think that is the appropriate method of sale in this case. In those cases, there was no contemplation of selling those businesses either at all or in the first instance to their customers, and we do not think that is the appropriate arrangement with Medibank Private. As I said before, we do not accept in any respect the false assertion that somehow when you take out an insurance contract with Medibank Private you acquire some proprietary interest in the business. That is simply not a valid argument.

Of course we have, as advised by our lawyers, allowed for every single theoretical possibility. As Senator Murray himself noted, the evidence before the finance and public admin committee was that it is standard practice, whether it is our government or any other government, based on the best legal advice, to allow for all of the most theoretical possibilities. And of course it is the case that you cannot, in a democracy like ours, and with a judicial system like ours, stop people either asserting that they will make various claims or indeed making claims. It is our strong position than any such claim with respect to Medibank Private has no standing and would not succeed.

But it is proper and appropriate as a responsible government to draft legislation to allow for theoretical possibilities. We have done that before and other governments have done that before, and that is the case with this legislation. But we do not concede that that argument holds any water; nor do we propose in the sale legislation and in the method of sale to concede that argument. We think, if you are going to have a public float, having decided that that is the best method of sale, that therefore the sale should be offered on the widest possible basis for every Australian to participate in, albeit acknowledging, as we have done with other sales, that there should be some form of entitlement to recognise the loyalty of Medibank Private’s many customers. On balance, and having considered Senator Murray’s amendments properly, we, given our policy position with respect to the method of sale, see no advantage to be gained by accepting those amendments.