Cheers all round as the Federal Government succumbed to the pressure on Friday and agreed to amend the Trade Practices Act to enforce a national approach to professional standards legislation and proportionate liability.

State and federal ministers meeting in Perth discussed issues relating to affordability and availability of insurance and confirmed their ongoing support for consistent reform.

Assistant Treasurer Helen Coonan said all states have now taken significant steps to implement nationally agreed law reforms.

A major focus of the meeting was the difficulties faced by all professionals in obtaining professional indemnity insurance at a reasonable price. Proportionate liability was considered as one way of dealing with the issue.

“The Commonwealth and all states and territories have committed in principle to adopt proportionate liability for economic loss,” Senator Coonan said. “This will mean that a defendant will only be liable to the extent that they have contributed to the plaintiff’s injury.”

The meeting also considered doctors’ concerns about “blue sky” claims in excess of indemnity limits. The examination of professional standards legislation will take into account potential application for medical practitioners.

The Insurance Council of Australia (ICA) was one of many organisations to applaud the agreement. President Raymond Jones said the inconsistency in legislation between states and territories has become “more of a problem”, and the second stage of reform could only occur when the Federal Government put its foot down.

He acknowledged some politicians’ desire to have an immediate reduction in premiums, but said the reform process is far from over. So far only NSW has successfully completed its commitments to legislative change.

ICA Deputy Chief Executive Dallas Booth says the council and insurers will work with ministers to assist further legislation. He said the industry acknowledges that the ACCC is continuing to closely monitor insurers’ pricing responses to liability reforms.

The Trade Practices Act decision has been particularly welcomed by the industry. Mr Booth said this will “prevent forum shopping, and will support a consistent legal regime across Australia”.