Senator the Hon. Mathias Cormann
Minister for Finance
Date: Friday, 29 November 2013
The Government continues to progress its considerations of a sale of Medibank Private through a careful and methodical process.
Today we are pleased to announce the appointment of key advisers to conduct the scoping study into the sale.
The appointments are Lazard Pty Ltd as Business Adviser, Herbert Smith Freehills as Legal Adviser, Ernst and Young as Accounting Adviser and the Australian Government Solicitor as Process/Probity Adviser.
The appointments followed a competitive procurement process conducted by my Department.
The advisers will prepare a scoping study report that will provide recommendations to the Government on all relevant aspects of the proposed sale process, including the sale method, the readiness of Medibank Private for sale, optimal timing, cost, relevant regulatory issues and estimated proceeds.
The procurement processes were very competitive and we thank all those organisations who expressed interest in assisting the Government through this process.
The scoping study will be provided to the Government by the end of February 2014 to enable consideration of the report in the 2014/15 Budget context.
The scoping study will be framed around the Government's objectives for a sale, which are:
- to contribute to an efficient, competitive and viable private health insurance industry;
- to maintain service and quality levels for Medibank contributors, including in regional and rural Australia;
- to ensure the sale process treats Medibank employees in a fair manner, including through the preservation of accrued entitlements;
- to minimise any post sale residual risk and liabilities to the Government; and
- having regard to all of the above objectives, to maximise the net sale proceeds from the sale.
The Coalition has long been committed to the sale of Medibank Private.
Medibank Private is a commercial business operating in a well functioning and competitive market with 34 competing funds.
As such there is no compelling policy reason for the Government to continue to own Medibank.
The Coalition is committed to progress the sale of Medibank Private through a proper and methodical process provided market conditions are right for the sale.
It is important to stress again that the Government has not made any decisions yet regarding the timing and structure of any sale.
We will await the findings and recommendations of the scoping study before making those decisions.
As previously indicated, during this process Medibank Private will continue to operate as usual and services to policy holders will not be affected.
Karen Wu 0428 350 139