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Tuesday, 25 September 2001
Page: 31444


Mr HOCKEY (Minister for Financial Services and Regulation) (11:00 PM) —A little earlier tonight, the member for Werriwa made a serious allegation about events involving the NRMA. The member for Werriwa unfortunately chose to take the cowardly approach and made these statements in the House rather than outside the House. He made a number of quite defamatory statements about a number of individuals. I understand that the House can be used for that purpose, but, if the member for Werriwa has any basis in fact for the allegations that he is making, he should refer them to the appropriate authorities.

There is currently a case before the courts involving the former chairman of NRMA, Nick Whitlam; therefore, it would obviously be inappropriate for me to comment on the circumstances surrounding that court case. Secondly, there is another court case involving the dismissal of Eric Dodd, the former chief executive of NRMA, and again it would be totally inappropriate for me to make any detailed statements about that. But I am, for the purposes of responding to the spurious allegations from the member for Werriwa, able to say the following. I have no great truck with Eric Dodd, nor do I have any great truck with Nick Whitlam, but I can tell the member for Werriwa that the collapse of HIH and my previous comments about corporate governance in Australia were at the forefront of my mind when the chairman of NRMA resigned on that weekend, at a time when there was enormous speculation about the reasons for the collapse of Australia's second biggest general insurer.

As a minister, I took the view that Australia could ill afford to have the caucus-like bar room brawl in the boardroom of NRMA spread to the executive of NRMA at a time when the largest general insurer in Australia was under pressure with the collapse of the second largest general insurer in Australia. I rang the acting chairman of NRMA and asked him if the speculation was true: that he and the board had done a deal to dismiss the chief executive of NRMA at the request of Mr Whitlam, who had resigned. He would not respond to me. I reminded him that at that juncture the chief executive of NRMA was also the chairman of the Insurance Council of Australia and was working with the government on a rescue package for thousands of policyholders in HIH, who at that time had no protection whatsoever. In fact, the insurance industry at that moment was working with the government to come up with a solution to respond to the immediate problems of HIH. At that point of time, it was decided within the board of NRMA that they were going to take their bar room political brawls into the executive of NRMA and potentially destabilise Australia's largest general insurer.

I do not apologise for one second for making it obvious to the NRMA, both publicly and privately, that the government, through its prudential regulator, APRA, and through its corporate regulator, ASIC, would carefully monitor developments at NRMA to ensure that good corporate governance was adhered to. I do not apologise for that. That is what any prudential and responsible minister would do to ensure that all appropriate laws were complied with by the board and by the executive of NRMA at a time whenthe insurance industry was under enormous pressure.

The member for Werriwa can make whatever allegations he wants in the coward's castle of parliament, as he has chosen to do, but if he has any basis to his allegations, he should put up or shut up and do it now, rather than under the cover of parliamentary privilege.