CTU Submission on the ACC 2010-2011 Levy Rate Consultation Document

November 2009

Click here for a copy of the full submission: MS Word 110kb

The CTU has argued that the history of  levy reductions demonstrates that extreme caution should be taken in setting levies and that a generous prudential margin should be allowed.

We have also noted previously that the cost of restoring fairness (both in terms of entitlements and the administration of them) should be factored into the projected ACC costs, in particular in relation to: the requirement in ILO Convention 17 that all necessary treatment should be provided for people who are injured in accidents at no cost to the injured person; and the requirement in ILO Convention 42 to provide the same compensation to workers incapacitated by occupational disease as is provided to workers incapacitated by industrial accidents.

The CTU has supported enhancements to the scheme such as: cover for a mental injury caused by exposure to a sudden traumatic event in the course of employment;  changes to the provisions for work-related gradual process, disease, and infection, to provide more clarity around whether cover is available and how it is determined, and to remove some existing barriers to cover; changes that allow greater flexibility to amend the list of occupational diseases provided in schedule 2; removal of the age-limits for eligibility for vocational rehabilitation; and better compensation for seasonal workers. These changes are fully justified. For instance, we believe that the greater support for occupational disease treatment indicates that there have been and still are significant costs for workers who suffer from occupational disease.

While we support a generous prudential margin we have included comments in this submission about the pressures introduced by requirements for full-funding to cover the lifetime costs of treatment and rehabilitation and we suggest a more balanced approach.

The CTU has always seen workplace health and safety as a core issue for unions and workers. In the context of ACC levies, reducing workplace injuries and occupational disease is not only a matter of safe workplaces and prevention of injury or death, but also a way to contain costs and hence levy increases. New Zealand's accident rate demands attention from a range of government agencies. In 2003, New Zealand was 23rd in a ranking of fatal accident rates in developed countries. It had 5.3 fatal accidents per 100,000 employees compared to just 0.8 in the first ranked nation, the U.K. The UK's fatality rate was 0.7 per 100,000 in 2007, but according to Statistics New Zealand ("Injury Statistics - Work-related Claims"), work place fatalities in New Zealand were 5.2 per 100,000 in calendar year 2004, 5.0 in 2005, 5.5 in 2006, 4.7 in 2007, and 3.3 for 2008.

The CTU with the support of ACC is a major provider of workplace health and safety training. The primary motivation of this training is to reduce the numbers of deaths and injuries of workers. But effective training that can reduce the incidence of injury also contributes towards minimising the costs of accident compensation. Due to funding cuts, training has had to be reduced. This will lead to increased claims.