Jeremy at
Aucklander at Large dismisses the call of the Transport Safety Minister
Duynhoven for compulsory third party vehicle insurance and says it simply will not work.
Duynhoven claims requiring third party insurance for all drivers would I have an impact on the
behaviour of the so called boy racers. "That very soon changes behaviour because people realise they are not in a position to drive if they have a lot of speeding tickets, a lot of vehicle offences or a vehicle which is modified with a very high premium because if they misbehave their premiums then go through the roof."
Like Jeremy I think the Minister is dreaming if he thinks the kids think 'premium' when they are burning the premium unleaded.
But unlike
Jeremy would like to see all drivers required to have at least third party insurance, so long as it can be made affordable.
If many young drivers cannot afford insurance, the insurance industry needs to take some
responsibility for this. Simply put, by stupidly inflating the premiums on the young, the insurance industry have told young drivers they are not wanted as customers, even if they have a clean driving record.
As a 31 year old male driving a slightly underpowered Mazda
Familia station wagon I did not expect to be quoted nearly $700 for insurance*. For the crime of not
requiring car insurance for the previous two years (I had been overseas) I did not qualify for any discounts. Now that I have moved to Auckland I am told my premium will nearly double in August, while I will get a 30% no claims discount, my premium it will be more than I paid in Christchurch last year. While the insurance industry may claim it is legal to insist the young pay more, there must also be a point, in terms of degree, where there is a possibility of challenging this under the Human Rights Act.
Before third party insurance could be made
compulsory I believe any social democratic government worth electing should first consider intervening in the insurance market to lower premiums. The introduction of the state owned
Kiwibank into the banking market has lowered fees and forced the other banks to offer banking packages for those with few beans in the beanbag.
So why not also allow
Kiwibank to offer lower cost insurance packages? The only difference between the insurance offered by
Kiwibank and
Westpac would be the cost.
The irony is that the
Government used to operate State Insurance, and this 'brand' is still in use by the private sector many years after privatisation. To my mind State Insurance, and their owners the Insurance Australia Group, continue to trade on the state's good name in false pretences - this has irked me for some years. If 'State' wasn't a commercially valuable brand they would have dropped it by now. Perhaps this also tells us New
Zealanders are not as hostile to the 'state' as the far right would have us believe.
Drivers already pay a kind of insurance premium for accident injuries when they licence their vehicles, so why can't government owned insurance cover the vehicles as well? (though ACC need to be told it is not acceptable to adopt the ethics of private insurers)
I have sympathy for requiring compulsory third party insurance as I believe being hit by a driver without insurance can lead to
unjust and
highly costly situations, for both the person hit and the person having to pay the bill. Messy court action may be required, increasing the costs of time and money for both parties. But more often than not, an insurance company sues or threatens to sue the uninsured driver for
everything they have, and then some. If premiums are simply unaffordable, and a car is the only way to get to work - an accidental swipe of a BMW can cause a person to be financially crippled for years - is that really a just outcome?
A parallel argument could be made here about the ability of those on very low wages to afford the 'premium' to be part of
Kiwisaver (4% of wages). Will we see a future government blame the non savers for not having the disposable income to make contributions, and use this as an excuse to remove universal public superannuation? Will they be left financially crippled in old age?
I would also like to see more restictions placed on the lending institutions to offer easy car finance - as finance on a fast depreciating asset like a car should be subject to greater restrictions to ensure the banks and the loan sharks are not simply ripping people off. Why not teach the boy racers better saving habits?
If all drivers had complusory third party insurance this would be for the benefit of everyone - a public good - so the use of public money to fund state intervention in the insurance market could be justifed IMHO.
* The quote was from State Insurance - I found a slightly cheaper premium elsewhere.
Labels: insurance, privatisation, superannuation
Jordan said
"Imagine, if you will, a situation where the Labour Party and the Alliance re-united in 1994, rather than not, and that as a result the Labour Party of today was a much more left wing creature than it is. (Practically this was never going to happen for a huge range of reasons, but bear with me). Imagine that this more left wing Labour party, with a wider activist base and a more radical policy and caucus, had taken power in 1999, aided by the Greens as a coalition partner."
Jordan then lists a reasonably moderate left wing programme with uncanny similarity to the programme the Alliance would have liked to have implemented in 1999, if we had not faced so much opposition to such a programme from within the parliamentary Labour Party.
Such a programme would have had more chance in 1999 if Labour party activists had not stuck slashes on electoral billboards with the poe faced lie 'Only a party vote for Labour can change the Government', costing the Alliance 2-3% of our party vote.
In any case, this is my response to Jordan's rather hopeful little scenario.
"I think it is pretty well established that Labour have drifted right again over the three terms they have been in government. Perhaps you should not be so ready to blame others for the Labour party lacking vision.
The direction of the programme you outlined would have been more likely if the Alliance had replaced the Labour party as the major party of the left in 1994. It nearly happened. If a few more people had based their party membership on policy and what they actually believed in, rather than party branding, we may have got there.
Without the existence of the Alliance in the first half of the 1990s the time the Labour party would be even more right wing than it is now (the Act people may have stayed and Goff might be the leader). Without the Alliance Labour would have had no reason to change. You can see this by comparing the policy of the Labour party in 1993 and 1996.
Not that I am saying Labour has changed enough to even contemplate the programe you outlined - it hasn't. It may have lost the neo-liberal crusading zeal in some areas (it retains it in trade policy), but this didn't equate to a desire to undo anything the forth Labour Governemnt did. While Labour reversed some of National's policies - they hardly touched their own.
Nor I do not believe it is fair for you to blame the left for failing to advocate an alternative. The Labour party need to take some responsibility for this too - since 1984* Labour have attempted to sell NZ a very limited version of social democracy - if you could even call it that. Labour party ministers regularly defend the neoliberal economy.
The fact that Government spending as a percentage of GDP is now lower than it was under National is not a record any self described social democratic government should be proud of. Perhaps if people had seen more significant increases into health eduction and housing people now would not be so ready to ask for tax cuts."