NO.076

JOINT MEDIA RELEASE

PRODUCTIVITY COMMISSION INQUIRY INTO THE COMMERCIAL RELATIONSHIP

BETWEEN THE SMASH REPAIR INDUSTRY AND THE INSURANCE INDUSTRY

The Productivity Commission is to inquire into the commercial relationship

between the smash repair industry and the insurance industry at the request

of the Treasurer, Peter Costello, and the Minister for Small Business and

Tourism, Joe Hockey.

The Productivity Commission will investigate ways in which transparency,

competitiveness and consumer protection in the smash repair industry can

be improved.

“Smash repairers have told me that they are concerned about their

ongoing viability as a sector. They are worried about the difficulties they

face when presented with commercial arrangements over which they feel they

have little or no control,” Mr Hockey said.

The Commission has been asked to report on –

• the appropriateness and transparency of criteria used by insurance

  companies to award ‘preferred smash repairer’ status to smash

  repairers;

• the financial relationships between smash repairers and insurance companies;
• arrangements for consumers to have a reasonable choice in the selection

  of repairers; and

• the extent, adequacy and independence of dispute resolution systems

  between the smash repair industry, insurance companies and consumers.

“This Government is about ensuring that we have vigorous competition

in markets to drive good outcomes for consumers. And a key element of a

vigorous market is informed parties and transparent commercial arrangements,”

Mr Costello said

The Commission is to provide a draft report within three months of receiving

the reference and a final report within five months.

Mr Costello also announced the appointment of Mr Curt Rendall as an Associate

Commissioner to the Inquiry.

“As a current member of the Board of Taxation’s advisory panel

and former member of the Dawson Review of the Trade Practices Act, Mr Rendall

brings a broad understanding of competition and finance related issues to

the position.”

Mr Hockey said the Commission would soon seek expressions of interest

from parties wishing to participate in the inquiry.

“I urge all interested parties to take part and make a submission,”

he said.

To register interest in the inquiry or find out more, details are available

from the Productivity Commission at www.pc.gov.au

or phone 02 6240 3239. Terms of reference for the inquiry are available

from the Productivity Commission website.

CANBERRA

31 August 2004

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