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ACC 2003 Annual Report shows excellent performance

ACC 2003 Annual Report shows excellent performance

The annual report of the Accident Compensation Corporation for the year ended June 30, 2003 shows the Corporation exceeded its targets and produced excellent outcomes for New Zealanders.

ACC completed one of its best years yet, Chief Executive Garry Wilson said.

"We expanded our focus on injury prevention and rehabilitation with the aims of stopping New Zealanders from getting hurt and getting them on their feet as soon as possible when they did," he said.

Key developments were record levels of claimant satisfaction, the implementation of a Code of ACC Claimants' Rights and the establishment of a Consumers' Outlook Group.

Net revenue from levies of $2.57 billion was $228 million ahead of budget, while expenditure was down $122 million at $1.98 billion.

Investment income of $437 million – or $200 million more than budget – was a return of 12 percent.

The operational surplus before investment income of $597 million was more than double budget.

But adverse interest rate movements beyond ACC's control and changed assumptions about the life of long-term claims were responsible for a $1.65 billion adjustment to the claims liability, leading to a $615 million deficit for the year.

Interest rates and other economic factors accounted for around $1.15 billion of the claims liability increase.

In addition, the projected time a claim can remain on the ACC scheme increased from 30 to 50 years which boosted the claims liability by a further $250 million.

The remaining increase was caused by normal budgeted price and claim volume changes. "Interest rates movements since have meant that we have a $500 million gain so far this year," Mr Wilson said.

"That, in turn, will be influential when ACC makes recommendations on next year's levy rates to the Minister for Accident Compensation."

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