Gordon Campbell | Parliament TV | Parliament Today | Video | Questions Of the Day | Search


Budget 2011: ACC turnaround delivers taxpayer savings

Hon Bill English

Minister of Finance

Hon Dr Nick Smith

Minister for ACC
10 May 2011 Media Statement
Budget 2011: ACC turnaround delivers taxpayer savings

Improved performance by ACC in the Non-Earners’ Account has freed up $638 million of taxpayer funding over the next four years, Finance Minister Bill English and ACC Minister Nick Smith announced today.

The Non-Earners’ Account covers claims for injuries to people who are not in the paid workforce, such as students, beneficiaries, retired people and children. This account is funded by the Government, using money collected from general taxation.

“The ACC scheme got into real difficulty with claims costs increasing by 57% and liabilities by 109% between 2004/05 and 2008/09. The Government in 2009 initiated changes to governance, reversal of entitlement extensions, putting increased emphasis on improved rehabilitation, containing costs, and increasing levies,” Dr Smith says.

“I am particularly proud of the work ACC has done to turn around rehabilitation rates that have had a huge impact on costs of the scheme. The 70-day rate deteriorated from 73% to 68% in the five years prior to 2009, but has consistently improved and is now back at 71%. Every 1% improvement in rehabilitation rates reduces liabilities by around $500 million.

“These reforms have led ACC back to a path of financial sustainability while ensuring claimants receive proper care, rehabilitation and compensation. This prudent management has resulted in a reduction in funding of $177 million for the ACC’s Non-Earners’ Account in the 2011/12 Budget and an expected $638 million over the four years to 2014/15.”

There was no increase in levies this year and ACC’s financial turnaround will give some room for levy reductions when considered later in the year.

Mr English says the strong turnaround in ACC’s Non-Earners’ Account was not only good news for the many thousands of New Zealanders who rely on it, but it will make a significant contribution to the Government’s wider programme to return to budget surplus as soon as possible.

“It’s important that the Government plays its part in lifting national savings by getting its own finances in order, returning to budget surplus and repaying debt,” Mr English says.

“The Budget later this month will take further steps in that direction by setting a credible path back to surplus. We will do that while continuing to support the most vulnerable and maintaining public services.”

In the past two Budgets, the Government reprioritised almost $4 billion of spending and Mr English says there will be more progress on this score in Budget 2011.

“The significant amount of money freed up by ACC’s turnaround, when added to these other measures, show the Government is taking a responsible approach to managing its finances, while at the same time improving public services,” Mr English says.


Rolling 12-Month
Expenditure against key liability drivers
Click for big version

“Budget” in above graph is reference to ACC’s 2010/11 SOI budget projections

© Scoop Media

Parliament Headlines | Politics Headlines | Regional Headlines

Hope For Nature: A New Deal For The Commons

Joseph Cederwall on The Dig: The disruption and destruction of the interconnected biodiversity of Earth is the most serious challenge humanity has ever faced. This is an ecosystem emergency on an extinction scale. It is also a serious threat to the inherent rights of the diversity of non-human life, ecosystems and human Cultures on Earth to exist and thrive. The current global paradigm is devastating life everywhere by disrupting vital “ecosystem services” like the food, water, and climate regulation systems that both humanity and biodiversity depend on in an interconnected balance. It is increasingly clear that the primary driver of this crisis is the limiting and infectious worldview around land and resource use so central to the global capitalist system. To fully understand the biodiversity crisis and explore what comes next, it is necessary to address this mind-virus at the heart of our modern civilisation – the dominion worldview. More>>


Gordon Campbell: On The Farming Sector’s Persecution Complex

The narrative that our farmers are ‘doing it tough’ plays into a number of wellworn stereotypes ... More>>


corrections, prisonCorrections: Independent Review Of Prisoner Mail Management

The independent review into the prisoner mail system has today been released, with Corrections accepting all 13 recommendations and making a number of changes to strengthen the management of prisoner mail. More>>


IPCA: Unlawful Detention Of Teenager; Influence Of Investigation

The Independent Police Conduct Authority has found that former Inspector Hurimoana Dennis unlawfully detained an Auckland teenager in 2015, and improperly influenced the outcome of a criminal investigation into his own son in 2014. More>>


SOP For Gun Bill: New Measures For Modified Pistols

The new controls will • Prohibit short-barrelled semi-automatic rifles which currently are defined as pistols because they are shorter than 762 millimetres. • Introduce tighter controls over pistol carbine conversion kits… • Prohibit firearms which contain a part known as a centrefire lower receiver… More>>

'Culturally Arranged Visitors Visa': Fix For Marriage Visa Issue

Earlier this year Immigration New Zealand issued guidance to front line Immigration staff that made it significantly harder for people to get visas to visit their partner. That guidance no longer applies with today’s announcement. More>>


Conflict Of Interest For Key Member: Budget Data Breach Investigation Shut Down

State Services Commissioner Peter Hughes has today terminated the investigation into how Budget-sensitive material was accessed at the Treasury and appointed a new inquirer. More>>

RNZ Report: Mysterious Foundation Loaning NZ First Money

A mysterious foundation that loans money to New Zealand First is under scrutiny, with a university law professor saying although it's lawful, it fails to provide the transparency voters need in a democracy. More>>

Justice: Criminal Cases Review Commission Established

“We’ve seen how our justice system can very occasionally get things spectacularly wrong, even with rights of appeals, and there needs to be a chance for the innocent on the right grounds to seek a final review of their case...” More>>





InfoPages News Channels