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APPENDIX 4
Allegations about Senator Helen Coonan
The Hon. Senator Helen Coonan, former Minister for Revenue and
Assistant Treasurer in the Howard Government, was mentioned in this inquiry in
two ways:
- There were allegations that Senator Coonan had received
favourable treatment in her own building dispute in 2001-02. The implication
was that this was done to induce her to form a good view of privatised home
warranty insurance.[1]
- There were allegations that Senator Coonan's position either as a
minister or as Chair of the Senate Regulations and Ordinances Committee, around
the time that Corporations Regulation 7.1.12(2) was made, has some suspicious
significance.[2]
Senator Coonan's building dispute
Vero advised that Senator Coonan made a claim in relation to defective
building works in March 2001 (when the NSW first resort scheme was still in
force). Inspection reports noted significant defects. Vero accepted the claim.
The quote for rectification exceeded $340,000. Vero paid $200,000 in June 2002
as that was the limit under the policy.
An internal review of the decision was undertaken in December
2002 following allegations in the media that Senator Coonan had received
preferential treatment. The review concluded that there was no evidence to
support the allegation.
Vero advised that, contrary to claims in evidence at this
inquiry, [3] paying the policy
limit of $200,000 was not particularly rare. In the period April 2001 to June
2002 Vero paid 18 claims on single dwellings at or near the $200,000 policy
limit.
Vero noted that suggestions that a $200,000 payment was
irregular, on the grounds that 'the insurance pays only 20 per cent of the
contract value',[4]
are unsound because:
- Senator Coonan's policy was issued before the 20 per cent cap
came into force;
- in any case, the 20 per cent cap only applies to non-completion,
not to rectifying defects.
Vero advised that the builder concerned has been the cause of
about a dozen claims, including three claims for the maximum amount.[5]
Senator Coonan and Corporations Regulation 7.1.12
It was suggested that Senator Coonan was 'responsible for this
area' around the time Corporations Regulation 7.1.12 was made, and that this
has some suspicious significance.[6]
Corporations Regulation 7.1.12 was made on 8 October 2001, at which time Senator Coonan was not in the ministry. It came into force on 11 March 2002, at which time the responsible minister was the Parliamentary Secretary to
the Treasurer, Senator Ian Campbell.[7]
It was further suggested or implied that there is some
significance in the fact that Senator Coonan was Chair of the Senate
Regulations and Ordinances Committee around the time the regulation was made.[8]
This misunderstands the role of the Regulations and Ordinances
Committee. The committee scrutinises regulations against general criteria, such
as whether the regulation is in accordance with the authorising act, or whether
it trespasses unduly on personal rights and liberties. The Committee does not
consider policy aspects.
In any case Senator Coonan was not on the committee at the time
the committee considered these regulations (on 11 March 2002). [9]
Senator Coonan's comment on this matter is attached.
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