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Natural disaster crop insurance



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NO. mi

TREASURER

PRESS RELEASE

EMBARGO

STATEMENT BY THE ACTING TREASURER, THE HON. ERIC L. ROBINSON, MP NATURAL DISASTER CROP INSURANCE

In December 1976, as the then Minister Assisting the Treasurer, I

announced that the Government had the question of natural disaster crop

insurance under consideration in conjunction with the insurance industry.

The Insurance Council of Australia submitted a report to the Government

in October last year on the feasibility of increasing the availability

of crop insurance in Australia. This report has been considered in

detail by the Government together with a recommendation on the question

of rainfall insurance by the Industries Assistance Commission in its

report of 10 Feb 1978 on rural income fluctuations.

The Government has concluded that it should not proceed with either the

development of a Government sponsored natural disaster crop insurance

scheme or with a crop insurance scheme based on rainfall criteria.

A number of considerations were taken into account in arriving at this

conclusion, including:

the current availability of insurance for crops together with the

Commonwealth's natural disaster relief arrangements with the

States and other specific assistance measures tailored to the

needs of the rural sector;

2

the apparent lack of demand for wider insurance cover for crops

unless heavily subsidised by government;

the inequities and inefficiencies that such a scheme could well

introduce into rural operations; and

Government policies of firm restraint in public sector expenditure

and minimal intervention in areas traditionally the responsibility

of the private sector.

I take this opportunity to thank the Insurance Council of Australia for

the substantial assistance it provided to the Government in preparing a

detailed report on this matter.

CANBERRA ACT

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