63/2009
1 October 2009
Medibank Private has today completed its conversion to become a for-profit Government Business Enterprise.
The Rudd Government announced the conversion earlier in the year as part of the 2009/10 Budget.
Lindsay Tanner, Minister for Finance and Deregulation said the conversion will improve competition in the private health insurance market by ensuring that Medibank Private is on an equal footing with its major competitors.
He said: “This important change will ensure competitive neutrality in the private health insurance industry. With this conversion, over 70 per cent of health fund members are serviced by for-profit health insurers who pay tax and dividends.
“Medibank Private will now be treated like other Government Business Enterprises such as Australia Post. This conversion will provide Medibank Private with additional freedom and incentives to continue innovating.”
The Government has worked closely with Medibank Private to implement the conversion. Medibank Private received approval for the conversion from the Private Health Insurance Administration Council (PHIAC) on 2 July 2009.
The amount of tax and dividends payable is linked with Medibank Private’s future profitability. Medibank Private continues to be required to meet prudential standards set by PHIAC which provide protection for health fund members.
Medibank Private has assured the Government that the conversion will not affect its members and more importantly, the conversion itself will not put upward pressure on premiums.
The Government remains committed to retaining Medibank Private in public hands and will remain the only shareholder of Medibank Private.
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| Media Contact: | Website: |
|---|---|
| Nardia Dazkiw - 0418 144 690 | www.financeminister.gov.au |
