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Minister needs educating on ACC

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Education minister Nick Smith is not comparing apples with apples, when he claims a significant saving for schools and the Ministry of Education from the Government's ACC changes, Labour ACC spokesperson Ruth Dyson said.

"Mr Smith claims the education sector will save $8.2 million when private insurers take over the provision of workplace accident cover. He has deliberately failed to account for four factors.
· He hasn't mentioned the Ministry of Education's ACC rebate, which is due any day.
· He hasn't mentioned the risk-sharing arrangement with the new private insurer. Schools and the Ministry will meet a significant part of each claim themselves. Just like you car insurance, if you pay a large excess, your premium is less. ACC offered full coverage.
· He hasn't mentioned the increased number of Board of Trustee members who are now registered as self-employed, and are not covered by the new arrangements.

"The fourth factor is the advantage of being big. The Ministry of Education is the biggest employer in the country. Insurance companies are prepared to under-price to get the business. It is clear from the cases sent into my office that the cost of this under-pricing is being borne by small employers, who have until tomorrow to find an insurer," Ruth Dyson said.

Examples include:
1. An Auckland commercial milk vendor. His ACC premium was $690pa. His quotes from insurance companies range from $2,000 to $2,500 - a 300 percent increase. He is having to lay off one of his two drivers as a result.
2. A Gisborne family-owned earth contracting business that employs 4 workers and has never had a work-related accident. Their ACC premium was $5,300. Their insurance quote is $17,785.
3. An Auckland wholesale butcher. His ACC cost was $17,000. His new quotes range from $21,000 to $46,000.
4. A Marton retailer. Employs one part-time staff member. ACC cost was $56, the insurance quotes range from $238 to 281.
5. A Wellington charity shop with one part-time worker. ACC accident cover was $54.10. The lowest insurance quote is $337 - a 600 percent increase.

"Once again National is looking after its big business buddies and loading additional costs onto small employers," Ruth Dyson concluded.

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