May 2

“Reform” gone wrong

It is not surprising that the insurance industry is so extraordinarily profitable.  This has been achieved at the cost of some terrible injustices imposed by so-called law “reform” on the most vulnerable Australians.  And who is to blame?  Let’s look at the facts, and you decide.

The return on net assets for the general insurance industry in the year to December 2006 was a handsome 19.4 per cent, and in the year before it was 21.4 per cent.  This is a direct result of so-called tort law “reform”.  This was recommended in a report by Mr Justice David Ipp in 2002 to address the problem of increasing litigation for all manner of losses incurred as a result of accidents.  When the politicians received the report, each government listened to further submissions from the insurance industry, and then they legislated.  The overall effect has been to remove or significantly restrict the legal rights of those who are injured in accidents on the roads and at work, and transfer the resulting benefit to the insurance companies. Threshold tests have restricted access to the court system and damages payouts for pain and suffering have been capped at different levels around the nation. The Carr Government introduced probably the worst example of tort law reform in the Commonwealth  – at least from the point of view of those injured.  There are three separate and inconsistent compensation systems now in NSW, so that people suffering the same injury receive different compensation payouts depending on whether they are covered by the Civil Liability Act, the Motor Accidents Compensation Act or the Workers Compensation Act. .  Some NSW government agencies are even immune from civil liability.  The result is not only a confusing mess, it is a public scandal.  You can read about some of the terrible injustices which have been perpetrated against the most vulnerable in our society at “A Fair Go For Injured People,”


Now, the author of the original tort reform proposal, Mr Justice Ipp, has come out and called for changes.  In “Liability of flawed law reform” in The Weekend Australian, 14-15 April 2007, Chris Merritt reports on this timely call from the bench for some restoration of the peoples’ rights.



And what has this to do with ACM?  This was a case where there was some need for reform to cap excessive claims.  But the reforms swung far too far the other way, to the great disadvantage of people at their most vulnerable. 


That is what concerns us.  The republicans demand that Australians forthwith change that part of the constitutional system that is in no need of reform.  In fact, they are targeting the one institution which works superbly.  And they have done it so badly, now pretending that they have no model.  Just remember those two half baked republican models which they seriously proposed in the nineties.  Tort law is of great importance, and just look at what happened to that.  The constitutional system is fundamental to the future of the nation. 



Look at the republicans’ record.   Before the 1998 Constitutional Convention, then during it, then in the drafting of the referendum bill and its consequences, the republicans did everything on the run.  They were even famously ill informed about what happens in the Commonwealth of Nations.




It was a mistake to let the NSW government near tort law reform. This has worked out to be disastrous, and against the interests of those battlers who are injured in an accident in New South Wales. We must never let these republicans do to our constitution what they have done to tort law.


Si fractum non sit, noli id reficere.



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