At his press conference on Sunday announcing the privatisation of Medicare, Finance Minister Mathias Cormann made the case for privatising the government owned and protected Australia Post retail outlets.
There is absolutely no good reason for the Federal Government to own a private health insurance business today. Medibank Private is a commercial business, operating in a well-functioning, well-regulated competitive market with 34 private health funds. There is no reason as to why the Government should be involved in that commercial, competitive market. Furthermore, by selling Medibank Private we will remove the current conflict which the Federal Government has by being both the regulator and the largest market participant.
The justification used for privatising Medicare applies 100% to the Australia Post corporate store network: these are commercial businesses operating in a well-functioning, well-regulated competitive market. The government is the regulator and the operator.
The only difference between the Medicare situation and Australia Post corporate store situation is the size of the competitors. Medicare’s competitors are big businesses whereas Australia Post’s competitors are small businesses, like newsagents.
If this government was fair dinkum about competition, government ownership of businesses and small business it would sell off Australia Post owned retail stores. Further, it would sell them to small business operators as part of a strengthening of the franchised network trading under the Australia Post name. This would end government owned retail outlets from competing with small businesses.
Further on in the press conference the Finance Minister is clear about the privatisation case:
REPORTER: What do you say to policyholders, particularly older Australians, who specifically joined Medibank Private because it was Government-owned. I spoke to one this morning and he was pretty annoyed, he did join because it was Government-owned and he was pretty upset.
MATHIAS CORMANN: The Government has made a judgement that in 2014 it was no longer appropriate for the Government to run a private health insurance business. Private health insurance is a very well functioning competitive market which is well regulated. There is no public policy reason for the Government to continue to be involved in this market. We believe that on behalf of taxpayers that the capital that is currently tied up in Medibank Private can be used better. Furthermore, I would say to the member of Medibank that you spoke to, that he or she will be able to have access to at least the same level of services into the future if not better because in our view without public ownership, without the restrictions that public ownership brings with it, Medibank Private will be able to go to another level.
Australians would be better served with locals awning and operating Australia Post shops and these being on a fairer competitive footing than the government owned outlets today.
Australia Post should be fair to both LPO’s and Corporates. By saying this – they should allow both the opportunity to sell the same products and services – thereby competing on a fair and level playing field.
As it currently stands Corporates get the cream and the LPO’s get the crumbs.
……. look at the higher attracting commission services of Passport Application, Working with Children etc – the quality of our staff is no less inferior, it really comes down to a $$$$ issue – and keeping it inhouse.