News National Govt to get Medibank sale advice this week

Govt to get Medibank sale advice this week

Twitter Facebook Reddit Pinterest Email

Advice on how to proceed with the sale of health insurer Medibank Private should be in the hands of the federal government this week.

The government is hoping to raise $4 billion from the sale.

The scoping study report will advise whether market conditions are right for a sale, while making recommendations to its structure and timing to maximise the net proceeds.

“There is no public policy reason for the government to continue to hold a private health fund,” Finance Minister Mathias Cormann told a Senate estimates hearing in Canberra on Tuesday.

As well, continued public ownership could be viewed a conflict of interest because the government regulated the health insurance sector, while running the nation’s largest fund.

The cabinet will consider the scoping study in the context of budget preparations for 2014/15.

A provision for a $100 million special dividend to be paid to the government by the insurer was factored into the budget by the previous Labor government.

Senator Cormann denied that he had hired a “spin doctor” in January to help with the sale of Medibank Private before seeing the scoping study.

However, finance deputy secretary Jan Mason told the hearing the department had hired a communications adviser, in line with other previous asset sales.

“When an asset is being considered for sale there is heightened media interest in that activity,” she told the hearing.

“It is important that the responses that are provided are co-ordinated and do not have the impact of potentially damaging value for the commonwealth.”

View Comments