Where is the evidence for an Australian Compensation Corporation?

Lets hope that the “more consultation and work”  on National Party  ACC policy which Leader John Key has promised results in a radical re-think  to bring the policy into line with objective evidence and the publicly expressed wishes  of all stakeholders in our ACC scheme.

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Where is the evidence for an Australian Compensation Corporation? 

Dominion Post Column, 11 August 2008
Helen Kelly, CTU president.
 
Lets hope that the “more consultation and work”  on National Party  ACC policy which Leader John Key has promised results in a radical re-think  to bring the policy into line with objective evidence and the publicly expressed wishes  of all stakeholders in our ACC scheme.
 
Public statements on behalf of business, workers, and the medical profession have made clear that there is no major interest which wants to disestablish our public fund accident compensation scheme in favour of a private insurance market dominated by large Australian insurance companies.
 
National has attempted a play on words to avoid admitting that privatization of ACC is its objective, but a cursory analysis confirms that this will be the result. At the very least ACC will become a private insurance market which, the merchant bank  Merrill Lynch report has advised, will enable private insurers to cream off $200 million a year in profits.
 
Only the Australian insurance companies will benefit from the National Party’s ACC policy and it is notable that only the private insurance industry is supporting it. This inevitably gives some credence to the suggestion in Nicky Hager’s book “”The Hollow Men” that Australian insurance companies have made huge financial donations to the National Party.
 
If John Key does undertake that further consultation and work he will find that the evidence shows decisively that New Zealand has the best performing accident compensation scheme in the world, providing world class benefits and rehabilitation at a cost much lower than any comparable scheme.
 
An independent review by Price Waterhouse Australia completed this year concluded, after  a detailed comparison with other public and private schemes internationally, that ACC delivers benefits comparable with the best schemes in the world, has a faster return to work rate at a cheaper cost than comparable schemes, and is unique in the comprehensive no fault cover which it provides to all accident victims regardless of cause.
 
The average employer levy rates in New Zealand are less than half of comparable schemes in Australia..  ACC also has lower claims management expenses (8%) than Australian schemes (up to 32%). Total administration costs are also lower.
 
Price Waterhouse, which is a firm usually associated with private enterprise, also specifically recommended against the private insurance delivery foreshadowed in the National Party ACC policy.
 
Price Waterhouse concluded, after detailed comparative studies of schemes in North America and Australia, that there is no evidence to suggest that there should be any change to the current method of delivery through our national public fund scheme ACC.
 
In summary Price Waterhouse is telling us,  on the basis of clear evidence laid out in its 400  page report, that we have the one of the best performing, cheapest, and fairest accident compensation schemes anywhere in the world.
 
New Zealanders have made a big investment in ACC over the past decades. It is a modern social insurance scheme which makes good use of information technology, and an experienced and committed workforce nationwide, to deliver crucial income and rehabilitation support to injured New Zealanders and their families, as well as investing in injury prevention in our industries and communites.
 
Where is the evidence Mr Key? Where is the evidence  to justify a radical change from social insurance (where injury prevention, effective rehabilitation and income support are the objective) to private insurance (where profit is the objective)?
 
Lets have a debate on what is good for New Zealanders, particularly those who have been seriously injured, rather than what is good for Australian insurance companies.

Ends.  Click here for the CTU's election page on ACC.