ACC levies to remain stable in 2013/14

The Government has decided to keep ACC levies in the Work and Earners’ Accounts unchanged for 2013/2014, ACC Minister Judith Collins announced today.

“This Government is committed to rebuilding ACC’s long-term sustainability, so we can invest in its systems, its people and the services it delivers on behalf of all New Zealanders.

“That means making sustainable change over time, and reducing levies over a longer-term framework,” Ms Collins says.

Levies were substantially reduced in 2012/13 by $630 million, with a 22 per cent reduction in the Work Account and a 17 per cent reduction in the Earners Account. Average Work Account levies are now at an historic low.

“While there is scope for levy reductions in the medium term, we need to have confidence that reductions are stable and sustainable. This has not always been the case,” Ms Collins says.

In making its decision, the Government has also considered recent volatility and continuing uncertainty in world financial markets and the effect these can have on the significant assets and liabilities held by ACC.

“Changes in economic conditions have been a major factor in recent deviations from ACC’s budgeted surpluses. Therefore, we have decided to err on the side of caution with a longer-term framework for levies.

“This approach enables ACC to focus on rebuilding the public’s trust and confidence, and rebalancing its priorities. It’s important that ACC’s focus on levy and financial stability is combined with an equally clear focus on providing high quality services to claimants and levy payers,” Ms Collins said.

Ministers have also taken into account that a reduction in ACC levies would have a direct impact on the Crown’s operating balance.

The Government has mapped a path to fiscal surplus and ministers have agreed that it is in the public interest that this is achieved.

Levy rates for 2013/14:

	Work Account Average levy per $100 liable earnings	Earners’ Account Levy per $100 liable earnings incl GST	Motor Vehicle Account Average levy per vehicle
2013/14 levy rates	$1.15	$1.70	$334.52