FAIR TRADING AMENDMENT
(MOTOR VEHICLE INSURANCE AND REPAIR INDUSTRIES) BILL

Page: 15

Second Reading

Debate resumed from 6 September.

Mr PETER DRAPER (Tamworth) [2.30 p.m.]: I support the Fair Trading Amendment (Motor Vehicle Insurance and Repair Industries) Bill, which is a positive step towards returning fairness and equity to the smash repair industry. Insurance companies have been allowed to dictate terms for far too long both to the industry itself and to motorists so this bill will help restore the balance and fairness and improve circumstances for everybody. I have received many calls from constituents concerned about the heavy handedness of insurance companies in the smash repair industry since my colleague, the honourable member for Northern Tablelands, introduced his anti-steering bill into the Parliament earlier this year.

The feedback has taken two forms: residents were very frustrated they were not able to choose who repaired their car after an accident, and repairers who were not accredited by the major insurers were literally struggling to keep their businesses afloat. This legislation is the result of a co-operative effort between many members of Parliament and, as other honourable members have done, I pay tribute to the Minister for Fair Trading for her very diligent, hard work and understanding of the complexities of the issue, because it was a very complex problem. I am aware of the many discussions and negotiations that have got us to this stage. I also recognise the contribution of the Staysafe committee. Ironically, the Chair of the Staysafe committee did seem to heap undue praise on the committee. However, it did do a very sterling job. The honourable member for Bankstown, the honourable member for Lane Cove and others have contributed. Credit goes to all sides of politics because this issue has been worked through co-operatively and, in my opinion, a sensible decision has been arrived at.

With more than 47,000 road accidents in New South Wales in 2004, the market for smash repairers is clearly large and lucrative, something that did not escape the attention of insurance companies who have used their market power to squeeze out small operators from the business and to coerce motorists into making decisions that they were not comfortable with. This has been very detrimental, in particular, for country repairers because the non-accredited outlets have not been able to continue running an effective or profitable business. They are facing an ongoing drought and very high fuel prices. Shutting the non-accredited repairers out of the market has cost jobs in the country and has forced quite a number to close. Those casualties have meant little to the insurance giants who have simply focussed on maintaining their profits but it means a great deal to country communities.

Due to the small size of many rural towns, smash repair business owners are typically among the most well known in the community. Virtually every resident in a rural town will know somebody associated with the industry, either through a friendship or a family connection, and that connection creates a very difficult circumstance for residents. For instance, I am aware of a local Tamworth resident who was waiting at the traffic lights in Bridge Street when someone ran into the back of his Ford. Luckily for him, his uncle owns a business in the smash repair industry. Unlucky for him, his insurance company said he could not use him. It is ridiculous that somebody in his family who would have done a sterling job and looked after his vehicle was unable to do the repairs. My constituent had no choice but to take his car to a stranger, and I have to say he was not particularly happy with the result.

During this debate we have heard that denying motorists their choice in repairer can lead to inadequate or inappropriate work—I will not go through that except to refer to another constituent who told me about his close relationship with a smash repairer. He had a very close encounter with a kangaroo, which happens all too frequently in the country, and was required by his insurance company to take his car to another repairer, not the one he knew who would have done a good job. The repairs were not appropriate, and the car had to go back. He was without the car for another week. There is no public transport in the country, and taxis are very expensive in comparison to what city people can access. If he had been able to choose someone he knew and trusted, this circumstance would not have arisen. Owing a vehicle is an essential part of living in the country where the risk of accident is much higher. We drive on unsatisfactory road surfaces, we have the risk of rocks breaking a windscreen, and we have the risk of encountering the local wildlife at night going home, which I have experienced personally. Cars are the arteries of our country communities so it is vital to maintain a vehicle in the best condition.

I am pleased that the Government, having listened to the industry and consumers, has developed this mandatory code. As I said, this bill will bring fairness and equity to the industry. I pay particular credit to the efforts of the honourable member for Northern Tablelands, whose original bill brought the matter to everybody's attention, and I give credit to the Minister for getting us to where we are today. I also pay credit to James McCall and Greg Collier who have done a great job. I too have attended meetings with those passionate advocates for their industry. I commend the bill to the House.

Proof, NSW Legislative Assembly Hansard, 22 September 2006