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Select Committee's recommendation heralds new era

“The ACC Select Committee’s recommendation to Parliament to pass the Accident Insurance (Transitional Provisions) Bill opens the way for the rebuilding of a new social insurance scheme where injury prevention and the needs of injured people come first,” says Associate ACC Minister Ruth Dyson.

“That has not been the case in the past and it certainly is not the case at present, where insurance company profits and employer costs are driving the schemes.

Ms Dyson outlines the key features of the new public scheme in an address to the Industrial Relations Conference for 2000 in Wellington today, as well as responding to the opponents of the planned changes.

“Injury prevention will be the primary objective and role for the scheme. Where an industry is driving a good safety and health message, the Government will support it. If it isn’t, our intention is to provide the tools and the resources – and the financial incentives – to build it,” says Ms Dyson.

“Removal of points of litigation is vital in rebuilding integrity in ACC. The definition of accident will be broadened – any argument delays rehabilitation and a potential return to work. It is simply common sense to address the injury as a primary consideration rather than the cause.

“The next key function of the corporation must be rehabilitation. In the Government’s new scheme there will be social and vocational rehabilitation as well as medical rehabilitation. It must start early, it must have the active cooperation of employers, and the aim must be to return to the maximum degree of bodily health, social independence and vocational ability in the minimum of time.

“Too often in the past, people have been turfed off ACC prematurely to save corporate costs. The priorites are about to be reversed.

“It must be accepted that, without the right to sue, compensation must be fair. Current levels of earnings-related compensation will be retained but we will also be reintroducing a fair and sustainable lump sum compensation arrangement for those who receive serious injuries.

"The funding of the scheme has been the area of the most shallow public debate. The main problems in the past have been caused by political interference. Lack of transparency and volatility in the levy setting has caused, justifiably, the biggest concerns. This is the last thing that I believe that New Zealand employers want, deserve or need.

"This is a real opportunity for employers who follow best practice to be involved in driving its rebuilding. It is an opportunity for employees to share in the responsibility for their health and safety management, in partnership with their employers, with legislative back-up. And it is an opportunity for us all to address seriously the injuries that impair and kill so many of our citizens," says Ms Dyson.

The main issues raised through submissions to the Select Committee were:
 Reduced levels of employer premiums
 Under-reporting of work-related accidents
 Restrictions on accident insurance coverage
 Different interpretations of evidence from overseas.

"The majority of members on the committee are satisfied that concerns about premium levels will be allayed when employers consider the average premium rates they will pay over the longer term," says Ms Dyson.

"Evidence suggesting widespread under-reporting of accidents points to a fundamental weakness in the private model. This will be addressed in the new public scheme.

"Listening to all of the arguments on overseas experience, we are satisfied that, on balance, the evidence supports public schemes over private schemes.

"Some groups, such as the Insurance Council, presented information to the committee which, on close scrutiny, seemed designed more to grab the headlines than reflect reality.

"The majority of the committee is strongly of the view that the new public scheme will deliver a fairer, more effective and more cost efficient scheme," says Ms Dyson.


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