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Thursday, 5 December 2002
Page: 7318


Senator COONAN (Minister for Revenue and Assistant Treasurer) (5:22 PM) —I can certainly appreciate the good intent behind the amendment that has been moved by Senator Murray for the Democrats and that will be supported by Labor, but I just want to put a couple of comments on the record in response. The amendment would require injured persons to obtain independent financial advice before entering into a structured settlement. There are serious difficulties in defining an independent financial adviser in a strict sense and so the provision would be difficult to enforce. Moreover, in practice, a person who is seeking a structured settlement or a structured judgment will typically have a number of advisers or representatives with a suite of legal, medical, financial planning and other skills. Dare I say it, I may be the only senator who has actually run one of these settlements and I can assure Senators Sherry and Murray that people in this unfortunate situation have a great deal of advice and their needs are very carefully assessed, as you would expect and as is needed in cases where a person has been catastrophically injured. As such, the government does not see a specific need to mandate that an injured person receive advice from a person in one field of expertise that relates to their future care and not others. It is somewhat illogical to be picking out financial advice as opposed to a separate medical assessment, for instance.

More broadly, the government's policy of encouraging structured settlements or court orders through providing a tax concession is certainly likely to encourage financial planning relative to the current arrangements. This is because plaintiffs and their representatives will of course be looking to ensure that the outcome, in terms of annuities and deferred annuities, meets the ongoing needs of the plaintiff. Whilst I hear what has been said in support of the amendment, I did think it appropriate to put on record that the government does not support the amendments and the reasons why it does not support them.