Sharing the load !

When we make a 000 call, different financial outcomes result.   If we need the police they do not submit a bill for their services.   If  we need an ambulance, the service is free for those on a pension, but all others are charged a mileage rate if they are conveyed to hospital.  To avoid this, they need to have their health insurance company pick up the tab.    The anomaly is the funding arrangement that covers the cost of the fire brigade.

Seventy-four percent of the funds needed to provide Fire and Rescue services ( NSW ), the Rural Fire service and the State Emergency service ( SES ) come from a compulsory levy on each and every home insurance policy issued by an insurance company in this state.   The state government contributes the balance.

None of these entities send in a bill when they attend a house fire, work on extinguishing a bushfire, or search for missing hikers.  It has long been a gripe of the insurance industry that this emergency service tax inflates the cost of their policies, but those who do not insure their homes get a free ride at the expense of those that do.

The state government is taking steps to correct this anomaly.   It is proposed that the insurance tax be lifted and replaced with a state wide levy on land values.  As a result, the premium for home insurance is expected to drop sharply, but all owners of property will be forced to share the load of financing a service that covers all property without a direct bill for services.   With lower premiums, many more people will probably insure their homes.

The sticking point seems to be how this tax will be collected.    The logical method would be to have it collected by local councils as an adjunct to rate notices.  The mechanism is already in place to establish each property value and collection would be a simple matter of including the levy in the rates bill.
Councils insist that this would be seen by some people as a council charge and councils would be unfairly vilified.  They want collection to be made the responsibility of the state debt recovery office.

This would add another level to the bureaucracy.  If nothing else, why add a postage charge to every property in the state when each council is already tasked with mailing out rate notices ?  Collecting this levy through the rate system is clearly the most cost efficient way of handling the matter.

This funding change delivers the best outcome for equally sharing the cost load.  It delivers an incentive for people to insure by way of reduced premiums, but it prevents the uninsured from opting out of paying their share - but still availing themselves of the service provided.