PSA MEDIA RELEASE

July 2, 2008

PSA Concerned About Job Losses And Increased Costs If ACC Privatised

“Privatising ACC will push up the cost of accident compensation for workers and employers and could result in ACC staff losing their jobs,” says Public Service Association National Secretary, Brenda Pilott.

The PSA has 670 members working for the Accident Compensation Corporation.

“We’re alarmed to see that Australian investment bank, Merrill Lynch, has issued a report stating that it has a clear understanding that National will privatise ACC if it comes to power after the election,” says Brenda Pilott.

Details from the report are published in today’s Dominion Post. This includes the information that privatising ACC would give Australian insurance companies access to $2.1 billion in new premium income. This would provide a $200 million boost to their after-tax earnings.

“All New Zealanders would be the losers if ACC is privatised,” says Brenda Pilott.

“ACC workers could face losing their jobs. And New Zealand workers and employers would end up paying higher accident compensation premiums to overseas owned insurance companies.”

“The fact is New Zealanders pay less for their accident compensation premiums than workers and employers in Australia, where they have privatised schemes,” says Brenda Pilott.

In Australia workers pay on average $2 in every $100 towards their worker compensation schemes. In New Zealand workers pay 78 cents per $100. “And the accident compensation in New Zealand is better than Australia,” says Brenda Pilott.

In New Zealand, people who are not in paid employment such as children and senior citizens, are covered by ACC. New Zealanders also receive accident compensation if they are injured playing sport.

The advantages and benefits that New Zealanders receive from our current state controlled not-for-profit accident compensation are confirmed in an independent report issued by PricewaterhouseCoopers’ Australian office in April this year.

PricewaterhouseCoopers’ report states that the accident compensation scheme provided by ACC “performs as well or better than most other schemes we can observe around the world.”

PricewaterhouseCoopers’ also confirms that New Zealand’s state controlled accident compensation is cheaper than privatised schemes because it doesn’t have to deliver a profit or cover the same marketing expenses as the private companies.

“National needs to tell ACC staff if it is putting their jobs on the line by privatising ACC,” says Brenda Pilott.

“They also need to tell the rest of New Zealand if they are going to increase the cost of accident compensation, and line the pockets of foreign-owned companies, by privatising our accident compensation.”

ENDS

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