Smash repair firms in St George and Sutherland Shire are becoming increasingly concerned about insurance companies operating their own repair shops and directing work to businesses prepared to work for lower rates.
Their concerns were supported by a bipartisan parliamentary committee, which found ‘‘a significant number’’ of vehicles were receiving poor quality repairs, ‘‘potentially increasing safety risks to road users’’.
The committee’s mid-year report rejected the need for insurers to be banned from operating their own repair centres, but made 21 recommendations to address problems.
In this special report the Leader examines the problems confronting the vehicle repair industry.
A BIPARTISAN parliamentary committee has found ‘‘a significant number’’ of vehicles are receiving poor quality smash repairs, ‘‘potentially increasing safety risks to road users’’.
The committee’s mid-year report rejected the need for insurers to be banned from operating their own repair centres, but made 21 recommendations to address the problems.
They included measures to provide more accountability for loss assessors and repairers; improve the balance in the power relationship between insurers and repairers; increase the transparency of the repair process and insurer practices for consumers; and make the industry’s code of conduct more enforceable.
Fair Trading Minister Matthew Mason-Cox was told of concerns in the shire when he visited Callaghan Collision Centre at Taren Point to promote the new Motor Dealers and Repairers Act, which starts on December 1 (see breakout below).
Proprietor Jason Hornby said his independent business, which repairs about 50 vehicles a week, was one of many which were worried.
‘‘I believe the government needs to look at an insurer having a vested interest in a shop, otherwise we are going to end up [with a situation] very similar to the Coles and Woolworths supermarket chains,’’ he said.
‘‘Coles owns the supermarket, the fuel station, the liquor shop, the pub, and now they are into insurance.’’
Mr Hornby said Suncorp Insurance, which also owned the brands AAMI, GIO, Apia, Vero, Bingle, Just Car Insurance and Shannons, had major interests in several repair businesses.
He said IAG (NRMA Insurance) did not now have its own ‘‘shops’’ but was undoubtedly looking at the Suncorp business model.
Mr Hornby said big insurance companies linking with large repairers with many sites could also disadvantage smaller operators.
‘‘I always say ‘no one does it like the bloke who owns it’, ’’ he said.
‘‘You can put managers wherever you like, but no one runs his business like the guy who owns it.’’
Mr Mason-Cox rejected opposition claims that the new Motor Dealers and Repairers Act included only one of the the committee’s recommendations.
He said the legislation was passed by Parliament late last year, and it would have been unfair to the industry to delay implementation while the committee’s recommendations were considered.
The government had until January 2 to respond to the committee’s report, he said.
Mr Mason-Cox said that the evidence was ‘‘mixed’’ on claims of sub-standard repairs being done.
‘‘Last financial year, we had 89 complaints relating to smash repairers across NSW,’’ he said.
Mr Mason-Cox said he did not believe a government should dictate how businesses should be run.
It was ‘‘a matter of getting the balance right’’, he said.
‘‘One of the committee’s key recommendations involved the code of conduct, and we are looking at how we put some teeth into that,’’ he said.
The committee said Suncorp and IAG controlled over 60 per cent of the market.
NAME, SHAME
A new ‘‘name and shame’’ register for motor dealers and smash repairers, together with heavier fines for tampering with odometers, will start on December 1.
Fair Trading Minister Matthew Mason-Cox promoted the new Motor Dealers and Repairers Act with the Liberal candidate for Miranda Eleni Petinos.
He said the register would include a firm’s licence details and any offences and disciplinary action.
He denied opposition claims it would be a pale imitation of the register for the food industry.
‘‘It will be very clear what their misconduct has been,’’ he said.
Mr Mason-Cox said the maximum penalty for altering a car odometer would be doubled to $22,000.
Dealers would also have to disclose information about a vehicle offered for sale, including whether it had suffered any hail or flood damage.
‘‘NSW Fair Trading inspectors will have new powers to issue orders to licensed dealers and repairers to fix faults without a consumer having to take legal action,’’ he said.
Mr Mason-Cox said the Opposition was wrong to say consumers would have less recourse to Fair Trading.
See related story on car repairers hitting out at spread of 'dodgy' work done to save costs: http://www.theleader.com.au/story/2669477/car-repairers-hit-out-at-spread-of-dodgy-work-done-to-save-costs/?cs=1507
Do you think changes are needed in the smash repair industry?
