CTU says no need for large ACC levy increases

The Council of Trade Unions says that the government should push out the deadline on the 1999 decision to fully fund the ACC scheme to 2019, instead of trying to meet all the costs by 2014. This would remove the need for major increases in ACC levies.

In 1999 a decision was made to fully fund all of the accident and injury payments ACC makes to meet the need of pre 1999 long term conditions and illnesses. Before 1999 levies were collected each year only in respect of cover for new claims expected in the following year.

“The CTU supports the call for legislation to be enacted to extend the deadline for full funding of the ACC scheme from 2014 to 2019. A big increase in the motor vehicle levy would therefore not be necessary, and a more modest increase in the Earners Levy would be possible for this and other reasons,” CTU Economist Peter Conway said. The CTU recommends an increase that is just over half that consulted on by ACC.

“We need to strike a balance in meeting the needs of full cover for the scheme for previous injuries and the levies on people today, and so extending the deadline for fully funding ACC was the primary recommendation in our submission on the recent levy setting consultation.”

“The CTU has supported enhancements to the scheme, such as cover for a mental injury caused by exposure to a sudden traumatic event at work. We already know that workers bear the brunt of injury in New Zealand – a national health and safety body has estimated that the full cost of occupational disease and injury totals $20.9 billion annually, and that only 2% of these total costs are compensated.

“Continuing to enhance ACC cover is an important part of rectifying this inequity, and address issues like those raised by the train driver who told his emotional story to a select committee this year.”

Download the CTU’s full submission here:
http://union.org.nz/policy/ctu-submission-to-20092010-acc-levy-rate-consultation