Injury Prevention, Rehabilitation, and Compensation Amendment Bill (No 2)

Hon MARYAN STREET (Minister for ACC) Link to this

I move, That the Injury Prevention, Rehabilitation, and Compensation Amendment Bill (No 2) be now read a third time. This bill continues to progress this Government’s commitment to a fair and sustainable accident compensation scheme by making changes to cover for work-related injuries; to eligibility for, and entitlement to, weekly compensation; and to entitlement to, and processes for, vocational rehabilitation.

The bill introduces cover for a mental injury caused by exposure to a sudden traumatic event in the course of employment. This is a major development for the scheme, and brings New Zealand’s cover into line with the cover offered to workers in many other countries. The bill is not intended to provide cover for work-related mental injuries caused by a gradual process such as mental stress caused by work overload, or the temporary distress that constitutes a normal response to trauma.

The bill introduces changes to the provisions for work-related gradual process, disease, and infection, to provide more clarity around whether cover is available and how it is determined, and to remove some existing barriers to cover. It does this through amending the test of work-causation set out in the existing Act. The bill also introduces changes that allow greater flexibility to amend the list of occupational diseases provided in schedule 2. The bill updates the weekly compensation framework in order to improve access to weekly compensation, particularly for seasonal and casual workers. It provides fairer and more straightforward weekly compensation for seasonal and casual employees through improving access to weekly compensation for people who are injured while temporarily between jobs. It allows earlier access to minimum weekly compensation for certain claimants, and increases the rate of weekly compensation paid to potential earners.

The bill also enhances the existing legislative provisions for vocational rehabilitation in order to provide better outcomes for claimants. The changes include removal of the existing age-limits for eligibility for vocational rehabilitation. The bill also addresses a number of other policy issues and improvements aimed at making the scheme clearer and more responsive to the needs of claimants.

The Injury Prevention, Rehabilitation, and Compensation Amendment Bill (No 2) builds on the framework provided by the existing legislation to provide a fair and sustainable accident compensation scheme for reducing the incidence and impact of personal injury. It enhances the scheme’s responsiveness to the needs of claimants. I commend this bill to the House.

PANSY WONG (National) Link to this

We have seen the headline in the New Zealand Herald today: “More price hikes in the pipeline for drivers” due to the Accident Compensation Corporation (ACC) levy increase through the petrol tax as well as motor vehicle registration fees. We can be assured that with the passage of this bill with the support of New Zealand First, there will be continuing price hikes for employers and for the self-employed in terms of their ACC premium through the work accounts.

Last night we had the revelation from the Minister for ACC, the Hon Maryan Street, that she and the ACC actually have no idea of the cost of some of the new coverage that is introduced by this legislation. For example, the estimated cost for mental injury caused by witnessing a traumatic event ranges between $7.6 million and $76 million. That is a wild guess—I would not even use the word “estimate”. According to the Minister, it does not matter to her that they do not know how much, roughly, the changes will cost, so long as New Zealand can lead the world. We are quite fed up with the Labour Government wanting to lead the world and leaving New Zealanders behind to cope with the increased living costs—those arising from the emissions trading bill, the regional petrol tax, and now the ACC premium—so that the Government can stand up and say it is leading the world. Last night we heard the expression “leading like a pack of lemmings jumping off a cliff”. That expression kept resurfacing, and it is very appropriate.

Let me go into a bit of the detail of this legislation. I will cover the three major changes or new areas of coverage introduced by this legislation. The interesting thing is that the first two—mental injury caused by witnessing a traumatic event, and the changes in the onus of proof with regard to injuries caused by gradual process—are all changes that would apply to those we call workers, but it would not apply to non-workers or non-earners. The reason the Labour Government so boldly introduced those changes is that they have to be funded by employers and the self-employed. When it comes to non-earners, the Government suddenly says providing cover would be too expensive and is not affordable. Indeed, officials have produced reports stating that it is too expensive to extend the coverage to non-earners, so it cannot be done. It is interesting that the Labour Government is blatantly making the statement that an earner’s life, his or her well-being, is worth more than that of a non-earner. If women who are not in the workforce suffer the same traumatic experience, then they will not be covered. There is a problem of equity. If new coverage is to be funded by employers and the self-employed, then the changes will be introduced, but when it comes to non-earners and the cover is to be paid for from general taxation, then it will not be funded. That is the equity issue.

There is also another problem. I am not sure whether this is true, but someone has told me—this has still to be checked out; I learnt this only yesterday—that in respect of volunteers, the Volunteers Employment Protection Act means that when volunteers attend their voluntary work they are assumed to be in the normal workforce. The Minister may think that volunteers who attend the same traumatic event as, for example, a firefighter, would be treated as if they are in the normal workforce, which means they would be covered. We were told that volunteers will not be covered. Of course, that is also a contradiction, given that the Minister said that the cost of providing cover is not a concern because such events will not happen very often. After 9 long years, Labour has suddenly felt the need to rush this legislation through. On the one hand it is confessing that it does not know the cost of providing cover, and on the other hand it is saying we should not worry about the cost and this provision is being introduced because such events will not happen very often. I am afraid that with law and order being an issue and crime getting out of control, they may happen quite often.

The other issue I want to point out is that this legislation is not very fair to employers. Representatives from Massey University came before the Transport and Industrial Relations Committee and said they had tried very hard to be good employers and had introduced good work practices to avoid injuries due to the height of laboratory bench tops or using a keyboard all the time, yet no matter how much good work practice the employer introduces into the workplace, when there is an injury the employer will assume the liability for it. At present, there is a need to prove that the injury was more likely to have occurred at work than after work. My good colleague Colin King raised a very good point. He is a champion shearer, but he is too modest to admit it, and he is also a rugby player. Last night he gave us some personal examples of the difficulty of holding the employer totally liable for back pain, for example. He asked how we could know how much of it was attributable to shearing work, and how much was because the individual also engaged in rugby activities. It was very, very unfair to make that change in the onus of proof, even though a provision has been put in to say that where there is doubt, the ACC can investigate. We all know that the Privacy Act and all sorts of legislation will make it difficult for employers, or even for the ACC, to inspect any individual’s home environment in order to decide whether it has contributed more than the work environment has to those gradual injuries.

The last matter that I want to raise is one that I think is really outrageous. For a long time the legislation has had a provision that if an individual intentionally inflicts self-harm, then he or she would not be entitled to accident compensation. Labour, with the support of New Zealand First, has repealed that provision. That means that an individual who intentionally inflicts self-injuries, or who attempts to commit suicide, will now be entitled to compensation as well as to treatment. We would feel appalled about anyone in New Zealand going out there to encourage or entice people to commit suicide. But we in this House are now passing legislation that is against the objectives of the accident compensation scheme. One of the scheme’s principal purposes is to minimise injury. We are now sitting here and debating the passing of legislation that says it is OK for people to inflict injuries on themselves, and in fact the corporation will pay them compensation. What a nonsense that is. In 2005 there were an estimated 5,000 reported cases of attempted suicide, and the Minister and the officials did not even bother to estimate the costs relating to that. But what is the message we are sending out here to people—that it is OK to inflict self-injury? Is that why the corporation is spending $5 million on a campaign—to say that is OK? It is appalling, it is an outrage, and National will vote against this bill.

Hon DARREN HUGHES (Deputy Leader of the House) Link to this

It is an extraordinary admission that one’s plan for the future is as pessimistic as that of that member, Pansy Wong; that one can be an Opposition spokesperson and longstanding member of Parliament—as that member is—whose main criticism of the Injury Prevention, Rehabilitation, and Compensation Amendment Bill (No 2) is that one does not want New Zealand to be a world leader in the area of injury prevention and compensation for working people. That shows a remarkable lack of optimism for our country and security, and a lack of confidence in our people. I am staggered at the contribution that member has made, because if there is one area where New Zealand has an extraordinarily proud record, it is accident compensation. I say to Mrs Wong that we can be very proud of this scheme, and that her speech and lack of policy detail and vision in this area are extraordinary. To criticise something around the edges then say she will not vote for the whole thing is absolutely unbelievable.

Labour is very proud to support this legislation in Parliament this afternoon because in Government we have continually expanded, extended, and maintained the protections for our accident compensation scheme. That has been an important principle underlining our policy whenever we have brought bills like this to Parliament. The Minister for ACC, the Hon Maryan Street, has outlined the two key areas that the scheme will now cover: workers who suffer a sudden traumatic event, and casual and temporary workers in our economy. The passing of this bill alone could benefit up to 400,000 people. I find it unbelievable that any party could vote against a bill that could potentially extend the hand of support from our society to 400,000 temporary workers. That is why this bill is so important and why our plan for the future is so important, as well.

The National Party’s record on accident compensation is woeful. We are more than happy to debate that with National members on the campaign trail, because National’s policy will always mean less cover, not more, for the most vulnerable workers. That is the stark reality of National’s privatised model, and the fact that National members will not talk about it in the debate shows how embarrassed they are about it. It is not aimed at helping the many; it is aimed at delivering to the few. That is why that party will not talk about it. But we know from National’s record in Government that the people it puts in charge of accident compensation are the likes of Jenny Shipley and Murray McCully. Those two names are an open-and-shut case as to National’s commitment to accident compensation.

We know from the work that has been published—I know that the Minister recently launched a book by Hazel Armstrong and Rob Laurs that covers this area—how important this scheme that Sir Owen Woodhouse brought to our country has been. I say to Mrs Wong and the other members of her party that when we debate in Parliament the importance of the scheme, we ought to debate how to improve the scheme—how to make it better and take it—

Dr PAUL HUTCHISON (National—Port Waikato) Link to this

Thank you, Mr Deputy Speaker, for the opportunity to speak on this third reading of the Injury Prevention, Rehabilitation, and Compensation Amendment Bill (No 2). I must say that the previous speech was a somewhat self-righteous contribution by the Hon Darren Hughes. He forgets who introduced accident compensation back in 1974.

PETER BROWN (Deputy Leader—NZ First) Link to this

Just on that point—about self-inflicted harm—I agree with the member that it is a sad day. But the bill actually reflects what is happening in society, and there is little anybody can do about it. New Zealand First members checked into the issue and we felt as concerned about it as the member obviously does, but the bill reflects what is actually happening, and it is better to have legislation that covers it.

Let me just say that the accident compensation scheme legislation that the National Government brought in, in 1974, was good, but, by crikey, subsequent National Governments decimated it—cut it to shreds. In 1974 it was good legislation, but then that Bill Birch and a few others got on to it, and they tore it to shreds.

New Zealand First will be supporting this legislation, but we think it should have gone further. For example, we would like to extend the coverage, and we would like to blur the line between accidents and sickness, and that can be done. Years ago—

Mr DEPUTY SPEAKER Link to this

Before I call the next speaker, I want to apologise to Dr Paul Hutchison, the speaker before the previous one. He was due to speak for another 4 minutes, but because of an equipment malfunction that time was taken off him. I say to Dr Hutchison that he has 4 minutes remaining. I know that the member was just warming up, and he is most welcome to take the remainder of his call now if he wishes to seek leave to do so.

Dr PAUL HUTCHISON (National—Port Waikato) Link to this

That is very generous of you, Mr Deputy Speaker, and very generous of the House, because the Injury Prevention, Rehabilitation, and Compensation Amendment Bill (No 2) is important legislation that needs to be properly aired.

One of the things I wanted to speak about was the fact that it was Sir Owen Woodhouse who acknowledged, in a piece he wrote entitled Rebuilding ACC Beyond 2000, that the “basic principles which support the accident scheme have been under the closest scrutiny for about 30 years, both here and overseas.” His piece continues: “Except for the occasional ideologue they have been regularly approved during that long period. In Government circles, for example, they were expressly endorsed by Sir William Birch on 11th November 1991, and as recently as 2nd May 1995 by the Honourable Bruce Cliffe.”

The concern that National has had today involves the excesses that Labour has gone to in terms of this legislation. If the amendments that Labour proposed to put in had been well thought-out, equitable, and not inconsistent, then maybe we could have achieved a bipartisan approach to them.

In my last few minutes of speaking time I want to express the fact that good employers such as New Zealand Steel—employers that took a very practical aspect and view towards accident compensation—were horrified by some of the things in this legislation. In relation to cover for work-related mental injury, New Zealand Steel stated: “the proposals offer an increased level of cover, but only to one group of levy payers—those funded by employers. This creates further inconsistencies in the recognition of a condition suffered by an individual.”

When New Zealand Steel goes on to talk about personal injury caused by work-related gradual process, it states: “The proposed changes remove all onus of proof from an individual … the ACC scheme should not be a default for what the New Zealand public health system cannot cope with.” That indeed is a very important and appropriate point to make. The company says it is virtually impossible to investigate a person’s non-work environment without encroaching on an individual’s right to privacy.

Finally, New Zealand Steel made the point about self-inflicted personal injuries and suicides. We heard time and time again about the awful incident involving the train driver and the mental injuries that he received. But if there happened to be a young woman with a child at that rail crossing who witnessed that horrific scene, that young woman would not be covered under this legislation. That is why National will not support this legislation. It is inequitable, it is inconsistent, and, as well as that, it has been hopelessly costed in terms of the realities of the funding. Thank you, Mr Deputy Speaker.

Dr PITA SHARPLES (Co-Leader—Māori Party) Link to this

Tēnā koe, Mr Deputy Speaker. Last night, as the debate raged on about this Injury Prevention, Rehabilitation, and Compensation Amendment Bill (No 2), I thought back to when I was the chief executive of the Race Relations Office, and to the incidents that happened at my workplace. Someone collapsed in our office and we tried CPR. Green stuff started coming out of his mouth. It was pretty yucky, and he died. I remember another time when a young man’s face was half shot away by a gang member in front of us. It is 30 years later, and I remember every incident so very clearly, so it gives me a real understanding of some of the issues that this bill is trying to address.

The mental injury arising from a sudden traumatic event, such as a death in the workplace, is not something that one can address just as an agenda item at the weekly staff meeting and then hope it is the end of the matter. Mental injuries are not that easy. Fortunately, the level of awareness around mental health issues has advanced dramatically over recent years. In fact, in a recent infamous poll, veteran rugby hero John Kirwan was ranked at the top end of the list; he was placed sixth for being open and honest about mental health issues. In a poll of 85, politicians were ranked at an all-time low, stuck between slot 66 and 82—that is, the dozen of us who even made the grade. Although the poll did not do much for our collective mental health, I did think it was interesting that the public mood was so positive about the way in which Mr Kirwan has brought a taboo subject out into the light. So it is pleasing that today we have legislation in place to ensure that there will be cover for the appropriate treatment to facilitate rehabilitation for mental injury from such traumatic events.

The Accident Compensation Corporation (ACC) currently compensates for mental trauma for victims of sexual abuse and physical injury, and we are glad to support the extension to cover mental trauma resulting from workplace incidents. It is indeed progress, as the Aotearoa New Zealand Association of Social Workers found, that we have legislation that appears to reflect an improved understanding of mental injury. Of course, there is probably no more stark example of the need for an appropriate response to workplace trauma than the tragedy that occurred in my own electorate of Tamaki Makaurau in 2001—the horrible triple murders at the Mount Wellington - Panmure Returned Services Association—that were experienced by a survivor who has suffered years of serious injury and rehabilitation. I place on record here my acknowledgment of the significance of the recent decision by the Supreme Court in upholding the appeal for the right to sue the Department of Corrections, which manages Parole Board orders. But for the purposes of this bill today, I simply say that when we consider the types of workplace incidents in which trauma may be experienced, there is no more powerful justification for the need of such support than when one considers the horrific violence witnessed in the RSA murders.

There was, however, a very good point made in the course of the bill by Victim Support and the Employers and Manufacturers Association (Northern), which has been spoken about today. Both of those groups highlighted the fact that treatment for mental injury from witnessing a trauma should be available to all people, not just to employees. The Employers and Manufacturers Association (Northern) gave a recent example of the horrific effects that would play out for years to come in relation to that 8-year-old boy—again in my electorate—who witnessed his mother being attacked in the Manukau City shopping centre car-park. The association submitted that it was blatantly unjust that although a young boy would not be eligible under this scheme because he is not a worker, an employee of the supermarket who witnessed the event would be covered. The distinction between compensation in respect of whether mental harm occurs in the workplace or elsewhere is an arbitrary one, and we sincerely hope that the Minister is able to give priority to ensuring that appropriate cover is in place to support all persons.

The recent case before the Human Rights Review Tribunal gives us considerable confidence that this Minister is prepared to respond quickly. My colleague Tariana Turia is responsible for having brought to the House a ruling from the Human Rights Commission of 19 May 2008, which was described as a “landmark in human rights law in that it shows how any New Zealander can challenge legislation they believe to be discriminatory and impacts upon them adversely”. The decision made on that day concluded that provisions in the accident compensation law are inconsistent with the right to freedom from discrimination, specifically on the grounds of age. And here we are, just a month later, with amendments that stipulate that age limits for weekly compensation cannot be used as a factor in deciding whether vocational rehabilitation would be cost-effective. So I congratulate Minister Street, Tariana Turia, and, of course, the plaintiff, John Howard, on a successful action across all fronts.

I can only hope that it paves the way for another ground-breaking ruling to be made on another case now before the Human Rights Review Tribunal. I refer to the case taken by the Child Poverty Action Group, in which it alleges the in-work tax credit discriminates against 220,000 children on the basis of work status. This is an act of discrimination that leaves around 150,000 children in severe or significant hardship because their families are denied at least $60 a week in family support.

We support the changes to provisions for vocational rehabilitation and independence. The bill gives ACC the discretion to extend the 3-year limit on vocational rehabilitation, recognising that for some claimants rehabilitation cannot be easily wrapped up within the defined time frame. We are pleased also to support the repeal of section 119, so that ACC can provide entitlements to claimants suffering wilfully inflicted injury. There is still much to do to address the gaps in the protection of young and older workers, the disabled, and those who have been affected by asbestos or chemical solvent exposure. But this bill makes significant steps to improve access to compensation for previously disenfranchised groups, particularly those engaged in non-standard work, those mentally injured by trauma, those between work, and those in seasonal and casual work. The Māori Party has always taken an active interest in both workers’ rights and the right to work, and we are happy to support this bill at its third reading. Kia ora.

DAVID BENNETT (National—Hamilton East) Link to this

It is a pleasure to rise to talk on the Injury Prevention, Rehabilitation, and Compensation Amendment Bill (No 2). This is the third reading of a bill that we have had substantial debate on over the last couple of days.

I think there is an element of irony in that we are about to farewell one of, I guess, the personalities of this House, who is known as somebody who will stand up and say what he believes in. It is very good to see that such a good-sized audience has come here to hear him. I will try to stretch out my speech to 5.30 p.m., when Nandor Tanczos will come here to give his valedictory speech. It is good to see that so many people have come here so early to support him.

This bill is an example of ideology not being implemented in reality. If the ideology behind this bill were taken to its full extent, the bill would not have the limitations that Labour has put in it. Although it recognises that mental injury deserves accident compensation treatment and support in the future, it has a number of fish-hooks that limit the application of accident compensation coverage.

The biggest delineation in the bill is that between work-related and non - work-related injury. The bill applies only to work-related injury. A number of submitters suggested to the Transport and Industrial Relations Committee that it was unfair that there was no encompassment of non - work-related injury. If we were to take the ideology, the pure basis for the legislation, to its full extent, we would have the legislation cover both work-related and non - work-related injury.

One of the submitters gave a very clear example to show when mental injury is covered and when it is not covered. The New Zealand Institute of Safety Management gave an example that had a number of possible scenarios. A motor vehicle accident could create two classes of injury. First of all, the employee, who was driving, will have his or her physical injuries covered, which is what happens now, plus any mental harm that may arise—that is the additional component under this legislation. The pedestrian who was hit by the employee, not being at work, will have his or her physical injuries covered, and any mental harm that is caused by those injuries will be covered under this legislation. That is pretty much as one would expect for those two cases. However, the witness, who was mentally injured, not being at work, will get nothing. That situation is not covered by this legislation. That non - work-related injury is exempt from receiving the benefits of the accident compensation system. But an ambulance employee who experienced mental trauma from seeing the event is entitled to claim; because that employee was at work, he or she will be covered under the legislation. Many submitters raised that concern in the select committee.

Another big concern that was raised in the select committee related to the examples that were provided. A number of examples were given of train drivers and dairy company tanker drivers who, in circumstances totally beyond their control, had suffered mental injury because of somebody else’s actions affecting them when they were driving in the normal course of their work. Such situations will be covered when they arise in the future, but the examples that were given to the select committee will not be covered under this legislation, because there is no element of retrospectivity in it. The point that was being made last night was that if we are going to provide cover for people, then, taking it to its pure policy extent, we should also provide cover for the examples that had come before the select committee—people who, while being engaged in their normal work conduct, had experienced circumstances beyond their control that had resulted in their suffering mental injury. Those people had quite horrific stories. I do not think anyone on the select committee would wish those experiences on anyone. I think the select committee members would certainly want to see some kind of recognition of the injury that those people had sustained. But they will not get anything under this legislation. This legislation will not provide any support for people who have suffered that kind of mental injury in the past.

That is a shame. If Labour, in promoting this legislation, had really wanted to deal with the issue, it would have dealt fully with it. It did not. Labour members picked out only what they felt they could deal with in terms of this situation, because they had looked at the numbers, and, from the way that the numbers stacked up, it would be very expensive to extend this legislation in the way that New Zealand First had proposed earlier. Full coverage across a whole range of situations would be a major expense for the accident compensation system and on the Government of the day.

This legislation also will be a major expense for the employer. There is no definite indication of what the actual cost will be. The cost to the employers is up in the air; there is no definite figure that can be plucked out as being the amount that the employers will have to cover in the future. There was a range of estimates, from the extremely low—say, $30 million—to a much higher figure that would be well beyond the means of many employers.

So there are three problems with this legislation. The first is the exemption of non - work-related injury. The second is that it does not cover all situations, in the sense that the people who provided their stories in front of the select committee will not be covered by it. The third problem is that the costing of it is not identifiable; there will be major costs for the employers, but those costs have no formal basis in the sense that they have not been promoted and we do not have a concrete figure to work with.

We are getting close to 5.30 p.m. and Nandor Tanczos’ valedictory speech. Nandor has not arrived yet, but I say to the Green Party members that, as a National Party MP and also as somebody from the Waikato, it has been a privilege to have Nandor represent the Waikato and his party in Parliament. He has been a national figure, and I think everybody in this Parliament will treasure his having been here. The personalities who make up a Parliament are something that we look forward to, and something that I think the public look forward to, as well. The personalities are the ones who get the coverage; they represent different points of view, different beliefs, or different expressions.