NRMA

National Roads and Motorists' Association Limited

Motto	Helping people every day
Formation	1920
Type	Mutual
Headquarters	Wynyard, New South Wales
Location	New South Wales, Australia
Membership	2.5 million members
Key people	Kyle Loades, President Wendy Machin, Deputy President Tony Stuart, Group CEO
Website	www.mynrma.com.au

NRMA refers to two historically related Australian companies:

• The National Roads and Motorists' Association, known as NRMA Motoring and Services, is a member-owned mutual organisation offering roadside assistance, motoring advice, International Drivers Licences, travel and other services in New South Wales and the Australian Capital Territory.
• NRMA Insurance is a brand and operating unit of Insurance Australia Group, a national insurance and financial services company. NRMA Insurance and NRMA Motoring and Services are independent companies and are both in agreement to use the same brand and name. Both companies are responsible for distinguishing the difference between the two organisations.

Early history

National Roads Association

The Australian National Roads Association, which would become the NRMA, was launched in 1920. Its original aim was not to provide road service or insurance, but to obtain “reasonable and just legislation” to fund and improve roads.^[1]

At this time the planning and financing of main roads, in particular, had fallen into chaos following the defeat of the Main Roads Bill in 1911. Subsequent attempts to create a board to oversee main roads and distribute funding had also failed. The 1919 Local Government Act left all decisions to local councils, where decisions were made "from the point of view of local utility". Through-routes and main roads were assigned a low priority.

The role of the RACA

The Royal Automobile Club of Australia (RACA) had been campaigning for better roads since its creation. The Club had initiated a Good Roads Association in 1912, and its work was supported by the newspapers, notably the Sydney Morning Herald.

The National Roads Association was to be a broader and stronger pressure group seeking the same ends, and it received full support from RACA. When the Association was formally established on 4 February 1920, its provisional committee included RACA President, WJ McKinney, and RACA's Roads and Tours committee chairman, DM Cooper. There was also AR Bluett, secretary of the Local Government Association, who had held office with Cooper in the Goods Roads Association.

Creation of NRMA and continued RACA involvement

John Christian Watson (Australia's third Prime Minister in 1904), became NRMA President in 1920 until his death in 1941. The NRA restructured as the National Roads and Motorists' Association at the beginning of 1924. The aims of the NRMA were to "cover everything necessary for the advancement and protection of motorists in all circumstances", a goal strikingly similar to that of RACA. This positioned the NRMA as a competitor as much as collaborator, particularly when it began to employ its own road service "guides". These returned servicemen "of exemplary character" patrolled specific areas, including the popular beaches of Coogee, Bondi Beach and Bronte, or were based at congested spots on the roads out of the city where they could receive messages by phone or relayed by other motorists.^[1]

RACA and the NRMA continued, nevertheless, to work together on issues of shared concern, such as continued lobbying for better roads. They shared the same solicitor, McCartney Abbott. In a joint initiative the Princes Highway was "blazed with a red colour trail". Strips of colour banded by white were painted on telegraph posts, fences and trees as part of a network of trails along State highways.

The NRMA attended a 1925 meeting convened by RACA on traffic regulations, prior to a government traffic conference. Together with other motoring lobby groups, including the Motor Traders Association and Newcastle Automobile Club, they resolved to draft suggested reforms. Particular concerns included the need for a special traffic court, and a change to the "plethora of danger signs" that had appeared in the streets, accompanied by "frequently incomprehensible signals of police" at intersections. As an alternative to the red triangle placed by police at danger spots, the NRMA favoured (and sponsored) the highway lighthouse, a beacon powered by acetylene that could flash for as long as four months without attention.

Launch of NRMA Insurance

The NRMA's membership was growing rapidly, nearly doubling to 7637 in the year to June 1925. An added incentive was NRMA Insurance, formed in 1925 and reestablished in 1926 as a private mutual company. By becoming a sub-agency of Lloyds of London, NRMA Insurance was able to offer household policies in addition to motoring insurance.

NRMA Insurance is a provider of car insurance, motorcycle insurance, home insurance, business insurance, travel insurance, boat insurance, caravan insurance and life insurance, Green Slip Insurance, Landlord Insurance, Income Protection Insurance, Bicycle Insurance,Comprehensive Car Insurance in New South Wales, Queensland, Australian Capital Territory & Tasmania.

Cessation of RACA

As the Depression took hold in 1928, it was apparent to both the NRMA and RACA that the two organisations were pursuing similar goals and duplicating services that might be combined. According to NRMA records, it was RACA that approached the NRMA regarding a merger. The NRMA went as far as examining RACA's books, but its Council voted against the merger. RACA subsequently rejected affiliation proposals put by the NRMA.

In 1939, the NRMA had 66,234 members and a huge road service operation. When the war in Europe began, it made a £10,000 donation to Australia's war effort, and followed RACA's early lead in forming the NRMA Transport Auxiliary. This force of 500 owner-drivers would provide rapid troop transport if required. Staff member, Miss K Broadbent, organised a Women's Auxiliary Transport Corps and successfully trained 506 women to handle trucks, lorries, ambulances and motor cycles.

RACA and the NRMA were both involved in information campaigns during the war, including the discouragement of petrol hoarding, considered both unpatriotic and dangerous. After the war, lobbying by the NRMA, RACA and affiliates in other States had a direct effect on the 1949 Coalition Government’s promises to end petrol rationing and give a better deal on road grants and petrol tax.

At the end of the war RACA took the decision to cease its road service operations. The NRMA's growth had made its rival operations considerably wider in scope and reach. RACA's members were better served by an agreement concluded with the NRMA whereby RACA membership included entitlement to full NRMA services, an arrangement that still exists today. For many years an NRMA officer was based full-time at the RACA Club House.

Recent history

Growth

The 1950s heralded the beginning of a huge surge in the number of cars on Australian roads, and NRMA membership increased in kind. They hit one million members in the 1970s, and by the late 1980s that number had doubled. To ensure the fleet of NRMA Patrols could find their members they adopted new technologies at the time like the two-way radio and the latest Holden station wagons.^[1]

Demutualisation

The combination of NRMA's continued financial success and ongoing board conflicts led to the proposal of demutualisation, first anticipating and then riding the wave of demutualisations that swept Australia in the 1990s.

NRMA Insurance's financial success led to a surplus in funds which could not easily be distributed back to members. Insurance premium rebates to members had the effect of artificially and harmfully deflating the price for NRMA's insurance products. Demutualisation, whereby members exchanged membership rights for shares in a listed company, allowed funds to be distributed to members without affecting longer term product pricing.

At the same time demutualisation would address the perceived corporate governance issues that centred on the long-standing board conflict. For example, institutional shareholders (who out of necessity would become significant owners of the large, newly listed company) would likely enforce a greater level of rigour and discipline on the board of directors. However, demutualisation would give control away from individual members and to institutional investors, with the result that motorists' interests would have less representation in governance.

When demutualisation was first proposed in 1994, conflict on the NRMA Board was described by an independent report as "of such magnitude and nature that it is debilitating to the organisation and potentially destructive". This first demutualisation, dubbed "Share the Future", initially received member approval. However, a successful court challenge mounted by some of the board's directors (Fraser v NRMA Holdings Ltd (1995) 127 ALR 543) derailed the plan, with the Federal Court of Australia describing the initial information material distributed to members as "misleading and deceptive". "Share the Future" proposed demutualising the entire company, i.e. both insurance/financial services and membership/road service. Member concerns centred on possible increases in insurance premiums and road service fees and decreases in service quality brought about a more profit-oriented company.

After much discussion and some acrimony, the NRMA successfully demutualised in August 2000, forming two separate organisations in August 2000 – National Roads and Motorists' Association Limited, and NRMA Insurance Limited (later the Insurance Australia Group Limited).

Separate paths

National Roads and Motorists' Association Limited, now trading as NRMA Motoring and Services Ltd, remains a mutual company owned by its members. Insurance Australia Group Limited is a listed company owned by its shareholders. It has a number of operating subsidiaries using the NRMA brand, including NRMA Insurance Limited, as well as a number of other insurance and related brands.

During 2004-2005, NRMA, in a joint venture agreement with JF Meridian Trust, acquired the Travelodge Hotel Group chain of hotels in Australia.^[2]

In September 2006, NRMA Motoring and Services acquired 75% of the car rental company Thrifty Australia from troubled Mitsubishi Motors Australia Limited in a multi-million dollar deal,^[3] however the deal was highlighted in the media and in NSW Parliament (Hansard extract, NSW Legislative Council, 19 September 2006, page 75 (article 46)) as potentially involving conflict of interest with the board member Gary Punch. In 2008, Thrifty became a wholly owned subsidiary of NRMA Motoring and Services.^[4]

It has also continued to grow its travel and holiday operations by investing in tourist parks, and most recently in January 2007, acquired a major stake in the travel wholesaler Adventure World.^[5]

Awards

NRMA won the Australian Business Awards for Service Excellence for the fourth year in a row in 2012.^[6] They also won, for the third year running, the ABA Award for Innovation. This award recognises NRMA's contribution to industry and to its Members by introducing new and beneficial technologies, ideas and processes.

Education and charity support

NRMA’s has well-established road safety programs aimed at all age demographics. NRMA provides free educational resources to preschools and schools to teach road safety and works with Kidsafe (Child Accident Prevention Foundation of Australia) and supports NSW Police Legacy’s Child Safety Handbook.

In 2012 NRMA Safer Driving School Road Safety Grants totalling $100,000 to was distributed to 54 new road safety programs. Child road safety remained a focus, with 80% of programs supporting school and youth projects.^[7]

NRMA has seven charity partners: The Leukaemia Foundation, Royal Society for the Prevention of Cruelty to Animals (RSPCA), Youth Off The Streets (YOTS), Sunnyfield, Starlight Children's Foundation, Conservation Volunteers Australia and UNICEF. Employees of the organisation are able to volunteer and fundraise for these charities. For example, the NRMA supports the free 'Mission to Care' patient transport vehicle for the Leukemia Foundation with Patrols and office employees driving leukemia patients to their appointments.

Environment

NRMA Motoring and Services operates one of the largest private vehicle fleets in NSW with over 400 Patrol vans and other vehicles. The company undertook a mandate to convert the Patrol fleet to LPG in 2006/2007 in order to reduce its environmental impact. The LPG conversion has led to a 30% reduction of NRMA’s Roadside Assistance fleet emissions. The organisation also purchases carbon offsets for NRMA-owned Roadside Assistance and for Thrifty corporate vehicle fuel usage. Currently NRMA Motoring and Services has reduced their overall carbon footprint by 35% since the baseline of 2009/2010 and are progressively moving towards carbon neutrality by 2020.^[8]

NRMA Motoring and Services has shown an increasing commitment to the environment over the past decade. NRMA commissioned the Jamison Group – an independent group of energy and transport experts to provide a roadmap to reduce Australia's dependence on oil, and to highlight the issues facing Australian motorists, the economy and the environment.^[9]

In 2012 the NRMA opened free public charging stations for electric vehicles in Sydney and Canberra, the first in a network that will help this emerging market to grow. They are also trialing an electric Patrol car to service urban areas.^[8]

Criticism

The NRMA has been criticised for its anti-cycleway stance. The Sydney Lord Mayor, Clover Moore said the NRMA, like big petroleum companies, has a vested interest in campaigning for car use. ^[10]

Greens MP, Lee Rhiannon said the NRMA has an anti-cycleway agenda. Said Rhiannon: "The NRMA's anti-cycleway campaign is a crude attempt to boost money for road building. It's time the NRMA leadership came into the 21st century and recognised that encouraging more cyclists is an easy way to reduce road congestion." Rhiannon accused the NRMA of using misleading statistics in its campaign. ^[11]

Advocacy

In addition to roadside assistance, NRMA continues to advocate for safety and improved infrastructure. In 1982, the NRMA worked with the NSW Government to improve road safety by introducing random breath testing, and in 2001 they fought hard to have the fuel excise capped – saving motorists about 10 cents per litre.^[1]

To ensure that all motorists are safe, NRMA has been lobbying for more safety education campaigns paired with enforcement, tougher laws for repeat offenders, along with a fairer licensing system. NRMA Motoring and Services has also been championing for better infrastructure and more transparent petrol pricing.

In 2012 the annual Seeing Red on Roads survey asked NRMA members to 'red flag' the roads that frustrate them the most. With 15,500 responses received, motorists again voted the Pacific Highway the worst road in NSW and ACT.^[12]

Other recent campaigns include:

• Hypothecation: In 2012 over 10,000 Members signed a petition to ensure that all revenue collected by the NSW Government from speeding fines be directed into improving roads, driver safety, and more highway patrols. Although the Government agreed there was a clause that allowed the Treasury to reclaim the money into consolidated revenue. Within hours the NRMA exposed this loop hole and were able to have the clause removed.^[13]

• Courtesy campaign: The community campaign including an Etiquette Guide and a ‘Courtesy Crew’ with billboard in Sydney. The campaign has expanded to lobby the government on drink driving penalties.

• Petrol pricing and the Bowser Buster: The Bowser Buster is an online petrol ranking system for over 50 locations in NSW and Canberra is publicly available.^[14]

Open Road magazine

Open Road was launched more than 90 years ago by the National Roads and Motorists Association (NRMA) to inform its Members about the activities of the NRMA, including campaigning governments for improved roads, road safety and information about motoring. It was launched in 1921 under the name, Good Roads, and was renamed Open Road in 1927.^[1]

In 2013, Open Road is the largest Membership magazine in Australia and is delivered to 1.6 million households every two months, making it one of the most read magazines in the country. It continues to inform NRMA Members about all things motoring, including car reviews, road rules and the work of NRMA in lobbying governments for a better deal for motorists. It also includes content reflecting NRMA’s other services for Members such as Travel, Safer Driving School, special Member deals and roadside service.

References

Wikimedia Commons has media related to NRMA Motoring & Services.

External links

• NRMA Motoring and Services
• NRMA CarWise
• NRMA Insurance