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ACC makes recommendations on $450 million of levy cuts

2 December 2015

ACC makes recommendations on $450 million of levy cuts

Thanks to a new funding policy and public feedback, ACC is recommending the Government makes across the board levy cuts of $450 million next year.

ACC Chair Paula Rebstock said public feedback had resulted in some changes to the proposed 2016/17 levies ACC consulted on in October.

“We haven’t changed the combined value of all the levy cuts we’re recommending, but thanks to feedback during consultation we have recommended changing how we apportion levy cuts across ACC motor vehicle levies,” says Ms Rebstock.

ACC is recommending the following changes to levies in 2016/17:

• 11% reduction to average work levy

• 4% reduction to earners’ levy

• 33% reduction to combined average motor vehicle levies.

“We saw notable support for the user pays aspect of the petrol levy. Many of you agreed with us that setting a portion of the Motor Vehicle levy through petrol is a fair way to collect motor vehicle levies. Basically because the more you drive the more at risk you are and so the more you should pay.

“Given the feedback we received, we’ve recommended maintaining the petrol levy at the current rate of 6.9 cents per litre rather than reducing it to 5.7 cents per litre as we consulted on. Maintaining this rate increases the proportion of Motor Vehicle levy you pay through petrol from 44% to 56%.

“ACC is not recommending cuts to motorcycle levies, as they are already heavily subsidised by other vehicle owners. However, we received some valuable ideas about motorcycle safety which our injury prevention team is considering.”

Ms Rebstock says the changes made to the cuts originally proposed by ACC show the important role that public consultation plays.

“We received some great feedback and ideas from New Zealanders. These have influenced changes to our initial proposals and shows just how important public feedback is.”

For the first time, this year ACC’s levy consultation featured a website – – where people could submit their own ideas and see and discuss ideas put forward by others. You can also find ACC’s full recommendations there.

“The scheme continues to be in a strong financial position, and the organisation is putting a concerted effort into lifting the level of service that ACC provides, to ensure this is a scheme that all New Zealanders have full trust and confidence in,” says Ms Rebstock.

The Government will make the final decision on levies for 2016/17.


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