NIBA HAS welcomed the fact that the Victorian Government has released a Green Paper on fire services funding but is not entirely happy with what it calls errors and omissions in the paper.

The insurance brokers association at the weekend began preparing a response that will be sent to all Victorian politicians.

“We are also letting members know so that they can advise clients and all other concerned parties,” said NIBA chief executive Noel Pettersen.

The association already sees problems with the Victorian Fire Services Funding Review.

NIBA supported “the concept” of the Green Paper review because Victoria should have a pilot study of non-insurance and under-insurance.
It was also important that the Victorian Government again considered the appropriateness of funding fire services by a levy on property insurance, Mr Pettersen said.
The pilot study and Review must be undertaken in a professional, transparent and independent way.
“Independent outside experts should be engaged in all stages of the pilot study and the Review to ensure that the resulting reports are balanced and of a high standard and can be relied upon for effective decision making,” he added.
“NIBA supports the Review but is concerned about a number of statements, errors and omissions in the Green Paper released by the Victorian Treasurer October 30,” he added.
“The Green Paper outlines a number of options for reform. It states, however, that the government’s preferred option is a continuation of the existing system for funding fire services by way of a levy on insurance.”

The Review should be conducted in an independent and professional way and not simply be used as a way of justifying the current arrangements.

Mr Pettersen said in this regard NIBA noted a number of misleading or important omissions from the Green Paper.

These included the interpretation in the Green Paper of the 2003 Department of Treasury and Finance Report on the Review of Fires Services Funding.

There was “a further misunderstanding of the link between the risk of fire and fire services contributions payable by the individual.”

It missed confirming that in reality the fire services contribution falls on insurance policyholders and not insurance companies.

Mr Pettersen said NIBA also was concerned with the method of determining under-insurance in the pilot study.

The study also failed to consider the implications of GST and stamp duty paid on policyholder contribution and Government Revenue.


This article is kindly reproduced with the approval of John Heath –