Richard Boyd Barrett (Dún Laoghaire, People Before Profit Alliance) | Oireachtas source

I will focus in particular on health and car insurance. One also could throw in flood insurance and other insurance issues. Insurance is one of the biggest rip-off scandals affecting ordinary citizens nationwide. It speaks to a fairly dramatic policy failure on the part of the current and previous Governments. As for what I mean by that, the problem is one of constantly rising premiums that cost people an absolute fortune and I refer to trying to understand how to deal with this problem, which is crippling many people who are paying out for private health insurance, the premiums for which have rocketed in recent years, or car insurance, the cost of which increased dramatically again last year by an average of 30%. When one cuts through all the chatter about it, what is at its base is profiteering by private companies. It is as simple as that.

The Minister, in his speech to which I listened and through which I have read, pretty much admitted this. To get to the bottom of this issue, instead of simply spouting hot air, an explicit acknowledgement is needed of what is at its base and how the reality of what is happening in insurance has debunked the ideological inclinations and prejudices of Fine Gael in particular but one possibly could throw in Fianna Fáil as well. The Minister said "healthy competition within the insurance industry should facilitate" reasonable insurance costs. He said it should, as that is the market belief. If one has competition between private insurance providers, such competition should, according to market theory, reduce premiums. Strangely, however, it does not. The opposite happens, premiums go up and it costs people a fortune. Why does the reality defy the theory consistently? A page or so further on in his contribution, the Minister gave the game away. He stated:

Until recently firms enjoyed a prolonged period of reasonable investment returns on the asset side of their balance sheets. This income stream provided firms with the scope to compete aggressively on price. However, recent reversals in investment markets worldwide have generated investment losses.

Consequently, in layman's language, when the insurance companies are not making a profit, premiums go up regardless of how much competition there is in a market. The idea that there would be competition and that this would put downward pressure on premiums simply does not translate. This was further confirmed at the beginning of 2016 by Standard & Poor's, one of our favourite international players. These are the guys who tell us what is happening on the bond markets and who rate states and their bonds on their creditworthiness, and in January 2016 the agency stated that Irish insurance companies would need to hike the costs of car insurance if they were to return to profitability any time soon. This was a senior analyst for Standard & Poor's explaining why, to get to profitability, they would be obliged to hike up car insurance costs and boy, did they do that to ridiculous and obscene levels, such as increases of 30% and young people being asked for up to €9,000 to be insured in some cases. This is absolutely unbelievable and is simply all about them making money. If they are not making money, they must jack up premiums and crucify people.

Is it not obvious that Members must cut these gombeen men out? That is what they are: they are fancy, global, nicely branded gombeen men. The middlemen profiteering in the area of health, car insurance, flooding or whatever it is are the problem. Their hunger for profit and the fact they operate purely on that basis dictates everything and currently is dictating extortion in the area of insurance. They must be taken out of the equation and profit must be taken out of the equation, most obviously in health. Five years too late, the Government acknowledged this with the abandonment of the universal health insurance policy. The Economic and Social Research Institute, ESRI, hardly a radical think tank of the left, confirmed what some Members on this side of the House had been saying for five years, namely, that involving private health insurance companies and claiming one could deliver universal health using private insurance companies would not work because one was not factoring in their drive for profit. One could add to that all the other unnecessary costs that go with private for-profit companies in this area. I would love to know how much they waste on advertising. I do not have the figures to hand but it would be nice to find out because one hears and sees their advertisements every day on television, on billboards and on the radio advertising private health or car insurance. How much money is wasted on that totally needless expenditure? All this stuff like branding, public relations consultants, administration and billing is absolute waste and profiteering. That is why the ESRI finally concluded with regard to universal health insurance, and the Government finally was obliged to admit five years too late, that the universal health model was going to cost €600 million to €2 billion more than currently is being spent on health and the Government was obliged to abandon it.

However, the Minister of State should take the next step and recognise that the involvement of the private health insurance industry in health care at all is a disaster. It is not just that we need to abandon universal health insurance; we need to get the private health insurance industry out of health, full stop. All it is doing is leaching money out at the expense of people who are forced into private health insurance because of fear of what is happening in the public system.

This relates to the debate we had earlier. I have here a very interesting paper, called "Creating Two Levels of Healthcare," which I invite the Minister of State to read. It was produced by Claire Finn and Niamh Hardiman at the Geary Institute in UCD. There are a couple of interesting passages in it. They explain the relationship, if one likes, between the private system - private health in general and private health insurance - and the mess in the public system. They state:

... the quality of the public sector is kept at a level that induces those who are better off to leave the public sector and seek private treatment ... Waiting time induces patients with high waiting costs to choose private treatment...

In other words, no one would take out private health insurance if there were no waiting lists. The private health insurance industry would not exist and people would not have to pay out €2,000 or €3,000 a year - and those costs are rising all the time - were it not for the waiting lists. Why would one possibly do it? It is only because there are waiting lists and accident and emergency units are a mess, meaning people are frightened to go into them. That is the only reason one would possibly take out private health insurance. The viability of private health insurance depends on the existence of a crisis in the public health system. The private insurance companies need it. Without it, no one would go to them. Therefore, they leach money out of the system. Billions of euro are spent.

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