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ACC Shines Against Its Australian Peers

Media Release
4 December, 2003

ACC shines against its Australian peers

ACC levies cost New Zealand employers less than half on average the workers' compensation premiums they would face in Australia, says a just-released Australian government report.

According to the Comparative Performance Monitoring report, ACC excelled on virtually all fronts, costing around a fifth of Australian schemes to administer and resulting in far fewer disputes.

ACC Chief Executive Garry Wilson said the differences were striking, whether it were for claim management costs or levies paid.

"New Zealand's no-fault ACC scheme really shines by comparison. The number of disputes is a fraction those in Australia, and so are the legal costs," he said.

"Just about any New Zealand employment grouping you can think of pays levies less than half those in Australia, be it farming or forestry, financial services, manufacturing or education."

Australian levies average 2.47 percent of payroll, going as high as 2.80 percent of liable earnings. This compares with less than 1 percent in New Zealand. (On a like-with-like basis, the Australians estimate New Zealand businesses pay 0.86 percent.)

"Only Queensland, with levies at an average 1.55 percent provides a comprehensive scheme coverage at a rate close to ACC's," Mr Wilson said.

While ACC entitlements are sometimes less generous, particularly for lump sums, they continue for the life of the injury and do not taper off over time as they do in Australia.

In Queensland, claimants whose disability is assessed at less than 15 percent go onto a sickness benefit after five years, while compensation for normal weekly earnings reduces to 65 percent for those whose disability exceeds 15 percent, Mr Wilson said.

"ACC claimants get 80 percent of their weekly earnings for as long as they are on the scheme."

Mr Wilson said Australian schemes have come under pressure and that had not been helped by several earning negative returns on their investments. ACC's investments returned 12 percent last year, or $437 million.

In a comparison of specific rates, New Zealand's non-residential construction levy of 2.97 percent of liable earnings compared with between 3.43 and 9.85 percent in the Australian states, New Zealand hotels at 0.97 percent compared with between 1.42 and 4.46 percent and nursing homes at 1.82 percent compared with between 3.25 and 7.64 percent in Australia.

The Comparative Performance Monitoring report can be found at http://www.workplace.gov.au/WP/Content/Files/WP/WR/Publications/CPMReport1103FifthReport.pdf

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