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Thursday, 17 October 2002
Page: 5406

Senator SHERRY (3:13 PM) —My question is to Senator Coonan, the Assistant Treasurer. Can the minister confirm that, during a speech to the Australian and New Zealand Institute of Insurance and Finance on 16 April 2002, she encouraged more use of pre-trial dispute resolution as a means of resolving claims? Isn't it true that the minister said:

The insurers and the legal profession need to carry out much more focused work in exploring the value of these techniques.

Can the minister explain what she is doing to promote alternative dispute resolution as a way of reducing crippling insurance costs?

Senator COONAN (Minister for Revenue and Assistant Treasurer) —Thank you, Senator Sherry. I am a bit like Senator Vanstone; I cannot believe my good luck in getting such a great question. This area is a very important part of the suite of measures that have been discussed by federal, state and territory governments. And I must say that we have had a great deal of cooperation from state Labor governments—quite opposed to the federal opposition—who have seen the great good sense of needing to work further towards trying to obviate the need to litigate and to therefore drive up the cost of claims.

Many measures that are being discussed with the heads of Treasury—and that includes the Treasury heads of every state and territory government as well as the federal government—look at how one can better do further work to encourage mediation and pre-trial dispute resolution. In fact, even with structured settlements, they are looking at a recommendation that, before any verdict over $2 million is entered, the parties attend compulsory mediation to see whether or not a structured settlement, which is much more aligned to the needs of someone who is catastrophically injured, can apply instead of a verdict being entered and therefore a lump sum being either a windfall or a shortfall.

With no help and certainly no encouragement from the opposition, this government is getting on with the job of taking a leadership role of coordinating the states and territories in a substantial program of law reform, a program that will see some consistency across states in terms of not only damages but also rules. Although it is largely up to the courts and the court rules as to how they actually implement pre-trial procedures, insofar as I understand it, every single jurisdiction has asked its chief justices to assist it to implement the rules to better target pre-trial dispute resolution, mediation and conciliation to avoid verdicts.

Senator SHERRY —Mr President, I ask a supplementary question. The minister might have some further important information to give us! Can the minister explain why she not only attended but also gave a PR pitch about the insurance law firm Lee and Lyons on 2 October 2002, the same day the final IPP report was issued, as reported in the Australian Financial Review on 4 October? Isn't it true that a founding partner of this insurance law firm is the partner of the minister's stepdaughter? Does the minister regard it as appropriate to promote a law firm which has such a close connection to her family, given her ministerial responsibility for insurance and the current focus on containing the ever-increasing costs to the community of insurance?

Senator COONAN (Minister for Revenue and Assistant Treasurer) —If I may say so, that question is almost beneath contempt. Obviously those on the other side, and particularly Senator Sherry, have absolutely no idea about any conception of reforms of the insurance industry and how legal firms that run insurance cases can play an absolutely vital part in how those reforms are implemented. If the opposition do not understand that how you handle claims also relates to how legal firms handle claims, I hope those people who elected those on the other side have a good think at the next election, because we need some serious cooperation in relation to something that has been a national problem. The best that Senator Sherry and the opposition can do is to talk about my opening a small boutique law firm. It is just beneath contempt. (Time expired)

Senator Hill —Mr President, I ask that further questions be placed on the Notice Paper.