2. Hon DAVID PARKER (Labour) Link to this
to the Minister for ACC
What is the proposed increase in ACC levy fees for a car, and how much would it have been if the date for full funding of the motor vehicle account is not extended?
Hon Dr NICK SMITH (Minister for ACC) Link to this
The Accident Compensation Corporation (ACC) board has recommended an increase in the average motor vehicle levy of $130.28, based on the current law and full funding date of 2014. The changes announced yesterday include deferring the full funding date to 2019, and that reduces that increase to $30.28. The option remains for this to be funded by an increase in the petrol levy or in the registration fee. The board is consulting New Zealanders on those options.
Why did the Minister encourage the media to report the prospect of accident compensation levy increases to car registration and petrol costs of $130—four times the actual $30 increase—and is this not another example of his scaremongering to justify cuts to accident compensation entitlements?
Hon Dr NICK SMITH Link to this
The board of ACC is actually required to follow the law. If the law is followed, that is the figure. If the member was at the press conference, he would have noted that I repeatedly said, and the media has rightly reported, that the highest figure that the Government thinks is realistic is the $30 figure. That is why it is making legislative and other changes. I say to the member opposite that it has been necessary for the Government to communicate with New Zealanders the true financial position of the accident compensation scheme, because the previous Government hid it and breached the Public Finance Act.
Sue BradfordWhich parties have guaranteed their support to the Minister for the accident compensation legislation, which will give effect to the announcements on the future of accident compensation that he has made this week?
Hon Dr NICK SMITH Link to this
On Monday Cabinet approved the bill that has been drafted by the Parliamentary Council Office. I am having discussions with a number of parties to get the necessary support for this legislation to be passed, so that we might be able to limit the increase in levies on New Zealanders.
Does the Minister stand by his comment: “If my doctor told me that I was terminally ill and I had 30 days to live, with the ACC rules the way they are, I’d be finding myself a train to throw myself under on the 29th day because my family would be treated so much more generously” than under the current law; and has he any evidence that New Zealanders have been committing suicide to get accident compensation cover for their surviving children?
Hon Dr NICK SMITH Link to this
That was never the inference. What I was attempting—[ Interruption]—to do was to point out—
Mr SPEAKERI apologise to the Minister. The Labour Opposition asked a question; they might like to hear the answer. I cannot hear it.
Hon Dr NICK SMITH Link to this
The same question was put to me by the media when I came into the House. I said that I am happy to apologise. Suicide is an absolute tragedy, and I would not wish it on anyone. Having said that, I do think it is important to point out that if a family suffers the tragedy of a loved one being lost through heart disease, cancer, or a brain tumour, they are not, in my view, different from those families that suffer it from suicide; I believe it was a mistake and wrong of the previous Government to extend the accident compensation scheme to include suicide, and that was the point that I was attempting to make.
Dr Jackie BlueWhat advice has the Minister received in response to the claim that the levy increases would be less if the Government had pushed out the full funding date to 2019 earlier?
Hon Dr NICK SMITH Link to this
This claim is ridiculous, as it makes absolutely no difference to the levies whether the legislation to extend the full funding date is passed in 2008, in 2009, or in 2010. The key decision is about which date it is extended to. This Government wanted to get a full grasp of the accident compensation scheme’s financial position before making policy decisions, and it has taken the board some time to develop a plan to address that. I find it rich that members opposite criticise the fact that we have not pushed out the full funding date, when they had 9 years in which to do so and did not.
Is the Minister telling the House that he indeed does not have the numbers to get the new accident compensation legislation through, and that that is why the bill is not coming up in the House under urgency today?
Hon Dr NICK SMITH Link to this
I am in consultation with parties to try to get support for the accident compensation reform bill, because I think it is important that we make these changes to the accident compensation scheme in order to make it fair, affordable, and sustainable. I will be having ongoing discussions with other parties to try to get support in this Parliament for sensible change.
Does the Minister accept statements by motorcyclists that they are now paying for accidents caused by cars, and, given Mr Judge’s comments on the radio today that the setting of levies is a political decision, does he accept that his Government has got it wrong?
Hon Dr NICK SMITH Link to this
The interesting thing about motorcycle accidents is that even if we assume that every single accident between a motorcycle and a car is the car’s fault, the levies would still have to be over $750. The actual cost for large motorcycles is $2,700. I think that the increase the board has proposed in respect of motorcycles is a big ask, but this country needs to have an honest discussion about the cost of motorcycle accidents and where responsibility for that should rest. It is a final decision for the Government to make and I look forward to the discussion about it. I make the point that if motorcyclists are not to pay for the cost of those accidents, then someone else has to.
What reports has the Minister received on the claim that accident compensation collected more in levies in 2008-09 than the lifetime costs of claims incurred in 2008-09?
Hon Dr NICK SMITH Link to this
The report I have received from ACC is that this claim is absolute nonsense. The scheme received levies in 2008-09 of $4.2 billion. The lifetime costs of claims incurred in that year, based on the latest valuation, is $7.1 billion. Mr Parker should apologise to the public of New Zealand for misleading them on this important point.
How can it be fair for the Government to charge poor people who can afford only older cars higher accident compensation levies than wealthier people with more expensive, safer, new cars?
Hon Dr NICK SMITH Link to this
The Government has made no decisions about the way in which we can provide better incentives for safety. The legislation we are proposing would, for instance, make provision for no-claim bonuses, which would reward the owner of an old car just as much as the owner of a new car. I think the essential point for this Government is that we need to improve the incentives for safety, for employers, and for motor vehicle owners, and that is why we are progressing with these reforms.
Sandra GoudieDoes the Minister agree that ACC should tighten its procedures in order to limit access to counselling for those injured through serious crimes?
I just wonder how well that question relates to the primary question, which relates to the ACC levies for cars and the motor vehicle account.
Hon Darren Hughes Link to this
I raise a point of order, Mr Speaker. Maybe I can assist the House. I think the member who asked that question on behalf of the Government has actually read out oral question No. 4, which is a Labour question. Maybe if she checks through her patsy question files, she will find the correct question to ask.
Is he aware that falls by the elderly are one of the fastest-growing sources of accident compensation claims and one of the top 10 causes of hospital admissions; if so, why has ACC today advised that its fall prevention programmes, such as the Otago exercise and fall prevention programme, have been cancelled?
Hon Dr NICK SMITH Link to this
It is certainly true that falls by older people have been an area of very substantive increase in claims and cost for accident compensation. The point I would make to the member is that ACC’s board is looking at the cost-effectiveness of those programmes. I put it to the member that if those programmes that his Government put in place were so successful, why is it that claims are ballooning at the rate that they are? The board is saying we need to invest in cost-effective programmes for injury prevention and not just in any old programmes.