Medibank Private members have called on the federal government to explain why their claims to the health fund’s assets would not be recognised in the upcoming float of the business.

Many longstanding policyholders joined the fund before 1997 when directors were adamant that Medibank’s assets were the property of its members.

The Abbott government intends to pocket all of the proceeds of the float, despite the fact that longstanding members were told they were owners.

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Finance Minister Mathias Cormann yesterday ruled out a special share allocation to Medibank’s 3.8 million members, arguing that they are customers rather than owners of the health fund.

“Customers of Medibank Private have been purchasing health insurance not an ownership stake in Medibank,” he told ABC Radio.

“I mean it’s like any other business that somebody purchases a product or service from, you don’t become an owner by purchasing a product or service.”

While Mr Cormann’s comments reflect the Abbott government’s position on who owns Medibank, they do not address the assurances given to members by federal governments before 1997.

The government’s decision to exclude other claims to the float’s proceeds has angered thousands of members who are demanding compensation.

A lobby group acting on behalf of the health fund’s members has sought legal advice with a view to mounting a constitutional challenge to the structure of the Medibank float.

Medibank policyholders told The New Daily they wanted to know why the federal government was ignoring their ownership rights, which were recognised by the Fraser, Hawke and Keating governments.

“As a long-term policyholder with Medibank Private I feel that the Howard government ‘stole’ Medibank from members,” said Malcolm Chew, who has been a member for more than 30 years.

“If previous federal governments have tried to sell but have reconsidered this action then this forced sale just shows that this present federal government has a total lack of respect for peoples’ rights.”

Finance minister Mathias Cormann. Photo: AAP

Another longstanding member, Richard Urquhart, described the government’s move as a rip-off.

“If the policyholders are entitled to shares, then why is the government covering it up?” he said.

“I have been a policyholder since before 2000 and would feel ripped off if the policyholders do not receive what they are entitled to.”

Many Medibank Private members have threatened to leave the fund if the Commonwealth does not issue free shares or a slice of the sale proceeds.

The New Daily reader Leigh Scott said it was “crazy” that the only benefit members would receive was a preferential allocation of shares.

“I will be transferring to another fund as soon as the sale is a fait accompli,’’ he said.

Medibank members can submit comments on whether they should share in the proceeds of the sale by email to [email protected], or leave a comment below.