The New Daily: While it is not unusual for government boards to prepare a draft press release in advance of an official decision being taken, such a practice might seem unusual and unfair or, even prejudicial, when a public consultation process is still underway. What is your response to this observation?
Shaun Gath: It was only a draft – we would have been in a position to amend or adjust any of those documents if there had been reason to do so.
You have got to remember we were under statutory rules about how quickly we needed to make a decision, so this was just good administrative practice.”
The New Daily: The PHIAC board had an opportunity to give policyholders more time to prepare submissions. The final decision was made nine days before the statutory deadline.
Shaun Gath: We acted with very senior legal advice. We felt that the significance of the transaction required us to advertise in newspapers across the country calling for submissions from interested parties. We were not obliged by the legislation to do this. Nevertheless, we recognised the potential public interest in the matter and decided to go above and beyond the formal requirements and call for public comments so that everyone got a fair go.
The New Daily: The low number of public submissions was noted by the PHIAC board in the minutes of the 2 July meeting. The council also noted “the paucity of publicly available information regarding MPL’s proposed conversion”. If the board members were concerned about this why did they not extend the deadline for public submissions?
Shaun Gath: We advertised in all the major newspapers and provided two weeks for anyone who had a view on the issue to express it. The submissions that were received were taken into account. The readers of your publication can be assured that the board was well informed about all the relevant matters which informed its decision.
The New Daily: Former Medibank Private chairman Fred Millar told fund members in 1988 that they were the owners of the fund’s assets. How relevant was his statement in helping PHIAC making its decision?
Shaun Gath: They are the views of a former senior office holder of Medibank Private. Our job at the time was to decide an essentially legal question namely “was the proposal in substance a demutualisation?” We concluded, as you know, that it was not. In so doing we took account of a great deal of material including the legal advice of two of Australia’s best barristers, Mr David Jackson QC, a former federal court judge, and Ms Jacqueline Gleeson, who has, herself, recently been appointed a federal court judge. So, our legal advice was right out of the top drawer. We are confident that we got it right.