Parliament

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

 

Mates’ rates for Aussie insurers will cost Kiwis

Hon Maryan Street
Minister for ACC


2 July 2008 Media Statement

Mates’ rates for Aussie insurers will cost Kiwis

Australian insurance company investors are being advised they would reap large profits if the ACC scheme was privatised, but it would come at significant cost to New Zealanders, says ACC Minister Maryan Street.

“The confidential Merrill Lynch briefing to Australian investors, made public today, says National has given insurers a strong message it would privatise the $10.3 billion public asset if ever elected - although the party consistently refuses to provide any policy details to the New Zealand public.

“The briefing says privatisation of ACC could be a “very positive development” for Australian insurers which should be able to “capture” what will become the New Zealand injury insurance market.

“Putting the world-respected ACC scheme up for sale will rob all New Zealanders of the security they have enjoyed in the event of accidents, wherever and however they occur, for several decades,” Maryan Street said.

“Once National has traded away the protection the current state monopoly offers, accident compensation will become a lottery.

“For a start, levies will skyrocket. The Merrill Lynch briefing notes that Australians pay significantly more for injury protection per person than New Zealanders and that they get less cover for the price.

This mirrors independent research by PriceWaterhouseCoopers released earlier this year which showed the same companies Merrill Lynch expects to take over the New Zealand market, charge Australian employers 250 per cent more in levies as a proportion of wages, Maryan Street said.

“That report found ACC employer contributions were 0.78 per cent of wages, compared to an Australian average of two per cent. It found ACC motor vehicle levies were also significantly lower.

“Perhaps most worryingly, the report found that without ACC - and under a scenario similar to that in Canada, the US and Australia – roughly 70 per cent of current ACC clients would only receive benefits through social security and the public health system, a significant erosion of the support they now get.

“Under that scenario, individuals would be forced to take out private insurance in the event they fall off a ladder or injure themselves in a rugby game - and be left without accident compensation if they don’t,” Maryan Street said.

“They may have to pay to battle for their rights in court as do injured people in a number of other countries, including Australia – and if they do win the evidence is that insurers will pay less compensation and invest less in rehabilitation.

“The National Party sold off the railways and we have had to buy it back. Selling off ACC is so much more serious, because it’s playing with people’s health and wellbeing – and that of their families. New Zealanders make 5000 ACC claims a day. Are we really prepared to put that in the hands of Australian companies whose only driver is profit?

“What makes this a particuarly ugly underarm bowl by National leader John Key is that his Merrill Lynch mates and the Australian insurance companies know about his plans and the New Zealand public doesn’t,” said Maryan Street.”

--

Other findings in the PriceWaterhouseCoopers report.

• “The ACC under its current government monopoly structure performs as well or better than most other structures” worldwide, is often considered to be “best practice” and provides broader coverage than any other scheme in the world.

• The best mechanism for delivering the employers and motor vehicle accounts in New Zealand is the current government monopoly.

• ACC clients return to work faster than their Australian counterparts and ACC has lower claim management and administration rates.

• In the US, UK and several Australian states the use of lump sum payments, instead of the weekly compensation paid by ACC, generally disadvantages clients . Lump sum payments are typically used by private insurers and often fail to cover the needs of people with long-term or serious injuries in particular.

• Research shows private insurers are often less concerned about the vocational rehabilitation of injured clients – and that a significant group of people can miss out on injury cover altogether under privatised schemes.

© Scoop Media

 
 
 
Parliament Headlines | Politics Headlines | Regional Headlines

Gordon Campbell: On Our Unreal Optimism About The Economic Impact Of Coronavirus

At this week’s Chinese New Year celebrations, PM Jacinda Ardern was resolutely upbeat that business with China would soon bounce back to normal – better than ever, even - once the coronavirus epidemic has been brought under control. To Ardern, the adversity has only accentuated just how close we are to Beijing Nothing wrong with being upbeat, if it can calm the nerves and turn business sentiment into a self-fulfilling prophecy. The problems begin when the optimism detaches itself from reality. What has been very odd so far about the coronavirus episode is that global share markets – normally spooked by mere sneezes or sniffles in the world’s major economies - have continued to be fairly positive, even as the epidemic has unfolded... More>>

First Published on Werewolf here


 

Gordon Campbell: On The Political Donations Scandals
Even paranoids have real enemies. While there has been something delusionary about the way New Zealand First has been living in denial about its donations scandal, one can sympathise with its indignation about Paula Bennett and Simon Bridges being among its chief accusers. More>>

ALSO:

UN Expert: NZ Housing Crisis Requires Bold Human Rights Response

This is a press statement from UN Special Rapporteur on the right to housing at the end of her 10-day visit to New Zealand. The Government of New Zealand has recognized that the country is facing a housing crisis, said Leilani Farha, UN Special Rapporteur ... More>>

ALSO:

2020 And Beyond: National’s Economic Plan

National Leader Simon Bridges has today outlined National’s economic plan heading into election 2020. “National understands the economy and how it impacts on New Zealanders day to day lives... More>>

ALSO:

Abortion Legislation Committee: Abortion Bill Report Presented To The House

The Abortion Legislation Committee has presented its report on the Abortion Legislation Bill to the House. A copy of the report is available here. The bill seeks to have abortion services provided like other health services... More>>

ALSO:


Auditor-General's Report : Water Management

The Auditor-General’s report Reflecting on our work about water management was presented to the House of Representatives today. Over the last two years we have been looking at how well public organisations are carrying out their water management ... More>>

ALSO:

 
 
 
 
 

LATEST HEADLINES

  • PARLIAMENT
  • POLITICS
  • REGIONAL
 


 

InfoPages News Channels