by Kevin Hague
On Friday, the Government released consultation papers on levy increases and experience ratings for ACC. They are calling for submissions by 29 October. Let them know what you think!
Reading between the lines, the papers also make clear that there is no financial crisis in ACC. As we have pointed out all along, ACC is taking significantly more money than it is spending. The so called crisis was a result of ACC investment portfolio taking a hit during the global financial crisis.
Last financial year ACC took in a surplus of $1.5 billion dollars, this year it has a surplus of over $2 billion dollars.
It is now clearer than ever that John Key’s Government manufactured a crisis in ACC to justify cutting services and raising levies. Their long-term aim is the privatisation of ACC so they want it to run more like an insurance company. They seem ideologically committed to a private model for injury compensation, despite the international evidence that this will reduce coverage and raise costs.
So where does experience rating fit into this picture? Experience rating links ACC levies to the safety record of the individual employer, which on the face of it doesn’t seem like a crazy idea. But as Helen Kelly of the CTU has pointed out, the evidence shows that all this does is incentivise the under-reporting of accidents.
Nick Smith has claimed that employers won’t be able to hide serious accidents but when this system has been trialled overseas (pdf) this is exactly what happens with accidents being downplayed or not reported at all.
What works in terms of reducing accidents is providing staff training, information in the workplace and health and safety standards. But the budgets for these types of programmes are being slashed under John Key’s Government.
The Key Government’s attempts to undermine ACC are unfair and unnecessary. Our no-fault system is a world leader, and while not perfect it provides a fair go for people regardless of their job, income or the sports they play.
The time has come for an impartial review of the sweeping changes the Government is making to ACC to see if reducing services and moving towards privatisation will benefit the people or the insurance companies.
If you are concerned about the direction that John Key’s Government is taking ACC, let them know. Submissions close on the 29th of October.
Help us to keep them honest. Truth to power!