The Guardian May 3, 2000


The NRMA:
Another step to total privatisation

"Sold: NRMA goes public" screamed a Sydney Morning Herald 
headline (20/4/00). It is just another of the lies that Peter Reith's 
Industrial Relations Department advocates for business leaders and 
politicians. In fact the insurance arm of the NRMA didn't go "public it was 
privatised. It used to be "public but in a short period of time it will end 
up being taken over by the big transnational insurance companies, the banks 
or investment houses. These sharks are already jostling to see who will be 
chosen to arrange the share float.

Far receiving a benefit from this privatisation, the public will be forced 
to pay higher insurance premiums as time goes on.

Although the road service arm of NRMA remains as a mutual organisation, it 
too will eventually be forced to put up its membership fees as it was 
cross-subsidised in the past by the insurance arm. Members of the public 
will be the all-round losers.

NRMA Insurance is the largest general (car, home, contents, etc) insurer 
and second largest insurance company in Australia. As a mutual company it 
was owned by and run in the interests of its members.

This position will be changed for good unless a court challenge by Richard 
Talbot (one of the Board members who opposed privatisation) succeeds.

As a private company its first priority will be to make profits for 
shareholders. Instead of being controlled by the equal votes of its 
members, the big shareholders will have complete control over its affairs.

There is no such thing as one shareholder one vote in private companies. 
The big shareholders appoint the board and determine the chief executive 
officers who will receive million dollar salaries and free bonus shares.

All policy decisions will be made with the interests of these big 
shareholders given first priority.

Previous attempt

The previous attempt to privatise the NRMA in 1994 was defeated by a 
combined legal and public campaign. Nick Whitlam was brought in to clean up 
the mess created by the former Chairman Don Mackay and to steer through the 
second attempt to privatise the insurance organisation.

Nick Whitlam has disgraced the Whitlam name that had stood for some level 
of integrity and progress.

Once again, those who championed privatisation played on the inherent greed 
which is rampant in society.

NRMA members can expect to receive shares which will be valued from a few 
hundred dollars to upwards of $4,000 or $5,000.

As they sell them and take the cash, their shares will be bought up by the 
big finance corporations and investment houses.

Those who retain NRMA road service membership can expect a deterioration of 
services with increased costs. The road service arm which has shared 
premises with the insurance arm will now have to pay for every service 
provided by the insurance arm at cost plus five per cent.

Call centres, internet, country service centres, human resources, finance, 
purchasing, property management, marketing, statistical research, 
investment services, etc, will now all cost the road service arm additional 
money.

We can expect that if you break down on a rainy night in the middle of 
nowhere that you will pay for what has been traditionally part of the 
service and is covered by your yearly membership fee.

Looking after people becomes a victim of the greed of individuals in the 
pursuit of their own interests. Instead of the interests of all, it becomes 
the profit of individuals. That's what privatisation is all about.

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