The Federal Government has decided that the critical issue relating to public liability is one for the states to deal with, and the Constitution prevents it getting involved anyway. Not so, says Shadow Treasurer Bob McMullan, whose advice is quite different.

Not only has the Government been lukewarm – publicly, at least – about what it should do about the causes and effects of the recent rises in public liability cover, but Mr McMullan believes Small Business Minister Joe Hockey is backing out of the issue as well.

While agreeing to host a summit between the insurance industry, state governments and business organisations next month, Assistant Treasurer Helen Coonan – whose role includes insurance regulation – hasn’t done much else. The fact that she has agreed to the summit at all was seen in Canberra as a reluctant response to Mr Hockey’s high-profile comments on the situation.

As the former Minister for Financial Services and Regulation before being demoted in the latest Cabinet reshuffle, Mr Hockey was seen as going in hard on a subject he knew more about than his successor. He has been very quiet on the subject in the past few weeks, leading to speculation that he has been gagged by the Prime Minister.

The sudden silence on the issue from the normally talkative Mr Hockey prompted Mr McMullan to accuse the Minister of abdicating his small business responsibilities.