Windfall hope from Motor Accident Commission sale
The proposed privatisation of the Motor Accident Commission (MAC) could deliver a larger than expected windfall to the State Government, the Treasurer admits.
The State Budget had estimated a return of $500 million – but Treasurer Tom Koutsantonis said today he hoped the MAC sale would net considerably more.
MAC manages the Compulsory Third Party insurance (CTP) scheme for South Australia to meet the current and future cost of personal injury claims arising from road accidents.
Koutsantonis announced in the June State Budget the State Government had decided to offer the business to private insurance companies.
“Writing third party insurance policies is not an essential service that should be delivered by government,” Koutsantonis said.
“This initiative is anticipated to allow MAC to pay $500 million in surplus net assets to the government by the end of 2016–17.
“Money from investments that reside within the MAC will be returned to government and placed into the Highways Fund to allow for future road improvements.”
Asked today is this estimate could be higher, the Treasurer said he would welcome a bigger number.
“Two billion dollars would be a good windfall,” he told ABC radio.
The MAC maintains an investment fund that includes shares, cash and property totalling more than $3.1 billion, the MAC’s latest annual report (2012-13) shows.
In 2013 it purchased a 50 per cent interest in 400 George Street, Brisbane, for $195.8 million, adding to its already solid portfolio of commercial property holdings in Adelaide, Melbourne, Perth and Brisbane.
Stay informed, daily
Koutsantonis said an actuarial analysis will be made to decide which part of the investment portfolio will be “surplus net assets”.
He confirmed that money currently paid by MAC to community organisations for road safety programs would now be raised by a new levy of insurance premiums.
“The levy would be a flat fee, indexed to maintain payments MAC makes to community groups.
“We may levy the insurance premium policy or levy the private insurance company.”
