Options for Extending the Accredited Employers Programme and Introducing Choice in the ACC Work Account

This submission is in response to the Department of Labour‘s (DOL) discussion document called ‘Increasing choice in workplace accident insurance’. The CTU is concerned with the Government ‘s proposals to expand risk sharing initiatives in the delivery of ACC by:

• extending the Accredited Employer Programme (AEP) to medium sized employers from 1 April 2012, and
• introducing private competition into workers compensation from 1 October 2012.

The CTU opposes both of the above Government proposals for three reasons:

• The introduction of competition into the Work Account is a form of privatisation of ACC which will add to overall administration costs (through duplication) and by the pursuit of insurance companies profits.  It will in our view reduce the potential outcomes for claimants, increase costs to employers, increase litigation and see technicalities being used by insurers to reduce and deny benefits to injured workers.  It undermines the principles of the current highly valued and world recognised scheme: comprehensive entitlement, real compensation, complete rehabilitation, community responsibility and administrative efficiency.
• Expanding the Accredited Employers Programme (AEP) to an increased number of employers including smaller companies expands a scheme that the CTU already views as having flaws.  The proposal for expanding the AEP also includes weakening some of the safeguards that are fundamental to the concept of the current scheme such as reducing audit standards and financial security requirements for those employers that choose to participate.  This will in our view further diminish the AEP.
• The current ACC scheme is a world leader. The proposals threaten to undermine many of its best features and expose both workers and the Government to additional risk.

See below for our full submission.