Thanks to the Accident Towing Group for sending in this article about their campaign to change the economic regulation of accident tow truck in Victoria.
In August 2014 the Victorian Government issued terms of reference to the Essential Services Commission (ESC), providing scope for the ESC to conduct a wide ranging review of the Accident Towing Industry within Victoria.
The inquiry was to review the economic regulation of accident tow trucks within Victoria, and to consider the costs and benefits of alternative forms of regulation.
Following a lengthy period of consultation with industry and importantly, predominantly with the major insurers, the ESC released a draft report to Government on 30 September 2015.
The draft report took the entire accident towing and body repair industry by surprise as a result of some of the detail, or indeed lack of detail, contained within the report and which had been used by the ESC to reach and then make draft recommendations.
It was clear from the draft recommendations that had been made and the data upon which the ESC had relied to make those recommendations, that the ESC had effectively been misled by the major insurers.
Alarmingly in making some of the draft recommendations, the ESC appeared to have acted outside of the terms of reference that were set by the Finance Minister, the Honourable Robert Clark, as he was then.
With some of the draft recommendations having potential disastrous consequences for independent body repairers and importantly for consumers also, a group of towing operators joined forces and attempted to navigate their way through the minefield that was the draft report.
Within seven days of the draft report being published the group of 24 towing operators had formed a consortium and pooled funds to engage legal and economic experts in this area to assist with preparing and publishing a detailed and considered response to the ESC’s draft report.
This group then engaged;
Mr Rex Deighton Smith, principal of Jaguar Consulting, an economic expert who has provided high level advice to governments across the globe on regulatory economic matters, including acting for the ESC, at times.
Mr Lyndon Kenyon of Kenyon Ahmet Lawyers, a well-known insurance and tow truck legal expert.
Ms Mary Anne Hartley QC, a senior member of the Victorian Bar, who importantly, sat as a Commissioner at the Essential Services Commission.
Mr Anthony Murdoch, Principal of Patten Robins Lawyers, who has significant experience in the towing industry, including acting for a large number of towing operators.
With only 5 weeks to prepare a submission to the ESC’s draft report, the group went to work. What resulted was the compilation of a significant and detailed submission that was formed using the detailed industry knowledge of not only the team briefed to author the submission, but using the varied and wide knowledge of all of the 24 members of the industry group.
The submission outlined the views of industry members which appeared to be missing in the ESC’s draft report, however and perhaps most importantly, illustrated a clear alternative view to the ESC and Government that perhaps the insurers are not always necessarily acting in the best interests of the consumer, instead concentrating on acting in the best interests of the shareholder.
As a result of the varied and detailed submissions received by the ESC in response to their draft report, the ESC sought an extension of time from the Minister for Finance, in order to finalise their final report. The final report was released publically in mid January and it appears that the ESC did in fact take note of the detailed submissions that were made by industry.
The ESC’s final report to Government removes the most intrusive recommendation and then significantly watered down a number of other recommendations that were contained within the draft report. It is no coincidence that the submission made by this independent group of towing operators focused heavily on these important areas.
Anthony Murdoch, Principal of Patten Robins Lawyers, who was ultimately responsible for the drafting of the submission said:
“I am particularly pleased with the amendments to the report. It shows that the majority of the industry, which we represent, were heard by the ESC. I hope the ESC now realise that the industry should be genuinely consulted on any future reports on Tow Truck Regulation.”
This effort by this group must be recognised for its stance against the major insurers and the fact that they came together so quickly and were able to deliver such a detailed and influential submission, that ultimately put a spot light back onto the insurers, with a recommendation that Government should consider holding a wide ranging enquiry into the smash repair industry.
The ATI Group (Accident Towing Industry) consisted of: Sheen Group Towing, Goumas Towing, Code 12 Towing, BTS Towing, Yarra Valley Towing, Bulleen Towing, Bacchus Marsh Towing, Melville Towing, VicWide Towing, Auz National Towing and Transport, Spot On Towing, Mill Park Towing, Warragul Towing, Accident Towing Pty Ltd, Geelong Accident Repair Centre, Geelong Towing Services, Winter and Taylor Motor Group, Fyans Street Panels, Torquay Towing, Allcar Towing, Fixwell Smash Repairs, Burchell Panels, Auto Care Towing and Local Towing & Salvage.