Abbott to sell Medibank

[i-need-a-martini]

There goes the benchmark that keeps our insurance premiums at a decent level.

I don't even understand why this is even necessary given that Medibank makes a profit? It's as if decisions are being made without any thought goig into it other than they promised to do it in 2007 so this is their way of punishing voters for not voting for them in at that time.

What other reason could there be?

http://www.smh.com.au/federal-politics/political-news/abbott-moves-towards-medibank-private-selloff-...

[monman12]

TB: "didn’t the cost of every product or service privatised go through the roof subsequent to privatisation."
As I have provided an answer to your earlier question by referring to banking,  I will answer your statement with an emphatic "It certainly did not"

TB: "do not the cost blowouts to the consumer post privatisation prove that “regulations and oversight” does not protect the consumer, in the way you say it would."
What cost blowouts?

The government regulations in force prior to 1990 apropos the banking sector were ill considered, and led to State banks demise/inefficiency because they were limited to state boundaries, once sold the geographic restrictions were removed.
"The position of government owned banks and insurers prior to privatisation had an important bearing on the outcome of the process. With one exception these institutions had been limited in their ability to develop and grow market share in their core business by the geographic limits of the respective regulatory jurisdiction. With a few exceptions they were slow to move into new product markets and develop a competitive culture."

TB you write "......as a publically owned bank the consumer was protected......." I would suggest you research the losses that accrued from the lending activities of the State Bank of Victoria and the State Bank of South Australia. The Rural and Industries Bank also ran into trouble in 1991 but unlike the state banks of Victoria and South Australia it survived the experience. The former  were sold and the related governments picked up the "tab", meaning the consumer/taxpayers.

The position of government owned banks and insurers prior to privatisation had an important bearing on the outcome of the process. With one exception these institutions had been limited in their ability to develop and grow market share in their core business by the geographic limits of the respective regulatory jurisdiction. With a few exceptions they were slow to move into new product markets and develop a competitive culture.

TB: "So compare the above to what is happening now."

I have done that already TB, but will  spell it out regarding banks:  regulation, competition,  and  the  history of current regulators, because the private financial sector is now well regulated/controlled by: 

APRA oversees banks, credit unions, building societies, friendly societies, general insurance and reinsurance companies, life insurance and most members of the superannuation industry. It was established on 1 July 1998

ASIC was originally formed as the Australian Securities Commission (ASC), which came into being on 1 January 1991

Note the dates and the history of the deceased government run banks, then those of APRA and ASIC..

   

"It's not actually legal for sheep or goats to vote"

[lakeland27]

when does the new JCW mini turn up MM ?  is it endowed with more grunt than the one you currently have ? i must say they have a high standard of build and finish.. pass the one pound coin test i'd say .

[i-need-a-martini]

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monman12 wrote:

INAM: "........ If I recall correctly, last year Medibank Private returned the government a profit of $400m last year."
FN: "Medicare brings in about $400million a year"

Medibank made (after tax) a profit of $233 million in fiscal 2013.

_____________________________________________________________________________________________

Before tax profit of $450m.

The government takes $227m in tax.

What's left is profit. That the government takes as well.

Like I said - medibank makes around $400m. It all goes back to the government. So nitpicking over whether $227 mill goes to the government or $450 mill goes to the government is neither here nor there as it all finds it's way to the same pool.

[lakeland27]

thats a lot of revenue to give up on a misguided principle.

[i-need-a-martini]

Apologies.

Profit before tax is $320m.

Not exactly a small figure.

[tall_bearded]

The customer I am speaking of is the consumer: the person who deposits or borrows money; the person who pays the account keeping fees and interest.  Not the  shareholder.

[boris1gary]

I suppose we should take some comfort from hockeynomics -

hockey in todays Age.

''We need to facilitate private-sector investment in infrastructure, and in Australia in particular, because mining investment is coming off,'' he said. ''We've got to recycle precious capital - taxpayers' capital. It's not a case of selling the family jewels, it's asking another member of the family to buy the jewels so that we can then go down the road and buy some more.

[the_hawk*]

nearly all services that have been sold off like telecoms, power and water have gone up many times the claimed inflation rate in SA 

[*crikey*mate*]

still not a fan of selling the assets, BUT, to be fair, health insurance has gone up to the point that it is oput of a lot of people's reach, even with Medibank as a regulator.

As more people drop their private health, the profits will decrease.

and now that legislation favours the insurers, it'll only get worse.

yep, so glad we had that fake insurance crisis

[boris1gary]

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@crikey*mate wrote:

still not a fan of selling the assets, BUT, to be fair, health insurance has gone up to the point that it is oput of a lot of people's reach, even with Medibank as a regulator.

As more people drop their private health, the profits will decrease.

and now that legislation favours the insurers, it'll only get worse.

yep, so glad we had that fake insurance crisis

---

that phony insurance crisis has had a knock on effect with jobs in the insurance industry as well, in  NSW  insurance companies involved with Workers Compensation started job cutting almost immediately after the legislation went through. Have heard recently (very reliable source) that one insurer just retrenched an entire office in a regional drought stricken area. Other's sacked local caseworkers and the work went offshore.