THE High Court’s decision to force Bupa Ireland to pay more than it earns in profits every year to the VHI could be the death sentence for the 10-year-old company in Ireland. Its 500,000 customers may have no choice but to join or rejoin the wholly government-owned VHI or opt for the No 3 player, Vivas.

The decision may be appealed to the Supreme Court, but for the moment the judgment is clear: Bupa must pay VHI, which is four times its size, as much as €161m over the next three years in risk equalisation payments.

These will subsidise VHI for having proportionately more customers who are elderly and who are, VHI says, turning into an expensive burden under the community rating pricing system, whereby everybody who buys private health insurance pays the same price, regardless of age.

The nature of the health insurance industry is that most of its customers tend to be young when they join. VHI has been in the market 40 years longer than Bupa or Vivas, both of which are required to take members of any age, including anybody who wanted to transfer from VHI.

VHI’s financial difficulties have as much to do with being a monopoly for those 40 years as they are with having competitors with younger, less expensive members.

Too bad the judge didn’t think that sharing VHI’s ageing members among the three companies — as Bupa itself would have welcomed — would have been a fairer solution. In fairness, though, that solution was probably not open to him. It is open to the government and our reforming minister for health.

VHI and the Department of Health claim this ruling will save our community rating system and provide “intergenerational support”. We’ll see.

But surely nobody can miss the irony of this decision in the week that the government and Aer Lingus unions are crowing that they defeated Michael O’Leary’s bid to create what they claim would have been a huge airline monopoly.

Stop foreign home rip-offs

Our widespread lack of financial education is one of the reasons so many people take so many risks. Young people blithely borrow more than they can possibly repay, middle-aged people invest in risky assets they don’t understand and older people leave their life savings in deposit accounts that don’t even beat inflation.

Risk is something actuaries know a lot about, and last week they were revelling in their favourite subject at a conference about consumer risk that was attended by Mary O’Dea, the Financial Regulator’s consumer director. The regulator has statutory responsibility for “monitoring the provision of financial services to consumers, providing consumer information and education, issuing codes and generally promoting the interests of consumers of financial services”.

The actuaries, like the Irish Association of Investment Managers before them, have again warned that overseas property investment poses a real risk to Irish consumers. Sellers of overseas property are not regulated in the way that domestic and even foreign sellers of shares and other assets must be.

Not only does overseas property advertising exaggerate the potential returns, but it also often claims that those returns are guaranteed when they are not. Costs aren’t transparent and there are no warnings about potential currency exchange or capital losses, say the actuaries.

You can’t legislate against people’s stupidity, and the Irish are breaking all records when it comes to stupid property investing. But that doesn’t mean that conmen should be allowed to stroll into the local hotel ballroom with a pile of brochures and cheesy backdrops and leave a few hours later with their wallets stuffed with cheques.

O’Dea and her colleagues need publicly and categorically to state that they should be given the authority to regulate overseas property promoters. It isn’t good enough for them to pass the buck back to the politicians. If they had been doing their job in the first place, this type of investment would have been included in the existing consumer legislation.

Poor need jobs not handouts

Poverty is relative — just ask anybody who has visited a Third World country or who tried to raise a family here 30 years ago on social welfare benefits.

It’s an emotive issue, too, especially when anti-poverty agencies try to highlight the problem by using the example of a family of two unemployed parents and six children receiving benefits worth €600 a week (as they did on a recent RTE radio report).

A net payment of €31,200 a year is not a lot to provide for such a big family. But as callers to RTE pointed out, it’s about the equivalent of the current average industrial wage. Lots of people manage on this kind of income, which they’ve earned and paid tax on.

Twenty years ago, a lot more people fitted into the CSO definition of poverty, mainly because they didn’t have jobs, were disabled or were pensioners. The same sort of reasons keep people poor in 2006. Breaking through that poverty floor for the able unemployed is going to take more jobs, not more handouts.