Hague Kevin: Accident Compensation (Financial Responsibility and Transparency) Amendment Bill — Second ReadingText is incorporated into the Bound VolumeHague Kevin: Accident Compensation (Financial Responsibility and Transparency) Amendment Bill — Second Reading[Sitting date: 17 September 2015. Volume:708;Page:6808. Text is incorporated into the Bound Volume.]KEVIN HAGUE (Green): I rise to continue the Green Party’s support for the Accident Compensation (Financial Responsibility and Transparency) Amendment Bill and given this is a second reading debate I want to begin by thanking the submitters. They were relatively few in number but their submissions were of pretty high quality. I also want to thank the officials who served the Transport and Industrial Relations Committee very well and I want to express my personal appreciation to the other members of the select committee and especially Jonathan Young its chair for enabling me to participate in at least part of the committee’s process. Unlike I think the National and the Labour parties the Green Party policy around funding for ACC is that the scheme should be funded as it was originally intended through pay as you go and a moderately sized reserve to be able to deal with fluctuations from year to year. We oppose full funding or future funding or as I like to call it full future funding for ACC—a principle that is enshrined in the existing legislation and is also specifically enumerated in this bill as one of the financial responsibility principles.We oppose full future funding because it mimics the way that private insurance works. A private insurance company needs to use full future funding because the person who pays a premium this year and who makes a claim on an insurance policy may not be a policyholder for that insurance company next year and the liability would none the less still exist. So it needs to be able to capture that with full future funding but that same principle does not apply to ACC because if one is intent on ensuring that ACC remains a core Government service then the person who pays a levy to ACC this year and may make a claim will still be a levy-payer next year and the year after and the year after that. So the case for needing full future funding simply is not made out in the case of ACC unless that is the intent of the Government is to privatise or at least to open up the scheme to competition from the private sector. Iain Lees-Galloway has in fact spoken in this debate about that dishonourable history around the ACC scheme.I will give some of the reasons we oppose that full future funding. First of all actually because of the uncertainty around valuation of future liabilities that Jonathan Young and the previous Government speaker Alastair Scott have spoken about that uncertainty about the value of future liability leads in fact to the kind of volatility in levies that all speakers in the debate so far have said they are interested in trying to control. This bill contrary to what several speakers in the debate so far have spoken about is not intended to actually address that volatility. It is about ensuring transparency which is a different but worthy goal. The other problem with future full funding—funding ACC as if it were a private insurance company—is that then that starts to create some of the behaviour that you might expect to see in a private insurance company. It starts to create what I have called in this House over a number of years now a culture of disentitlement where people working on the board of ACC in its management and at all levels think that their job is to be able to say no to claims rather than to honour the social contract on which this great scheme is actually founded. As I say I think the Greens are pretty alone in the House as advocates of pay-as-you-go funding. We would if we had the opportunity return the scheme to that basis. But actually since the scheme is now more or less fully funded that debate for the sake of this bill at least is largely academic. For this bill as we have indicated and as all of the submitters indicated the purpose of improving the transparency of the levy-setting process for ACC and making sensible adjustments around residual levies is absolutely a sensible thing to do. I think both the small number of submissions and the content of the submissions indicate that most people accept that these are worthy things to try to achieve.I want to talk about two particular things in relation to the detail of the bill. One is around the process for levy setting. Several submitters commented that the existing process for levy setting involved a process of consultation that was sometimes tokenistic and actually bore little relationship to the results that actually came about in the levy-setting process—in other words a disingenuous process. That is because of the conflation of both technical and political goals in the levy-setting process. I indeed have expressed some criticism of the Government for its use of both the ACC reserve and its levies as a kind of ballast for the Government’s overall financial position which I believe to be inappropriate. I accept the point that Labour speakers have made that that is not properly addressed in this bill and the bill would be improved if it were properly addressed. Both unions and Business New Zealand would agree with that being done. If the Government is serious about what it said about the purpose of the bill it too will agree to making that specific and clear.I thank the select committee for picking up my proposal that the setting of the funding policy statement should also be the subject of consultation because that is the political part of the process. So separating out the political part from the technical part is important but the consultation is actually more important about the political settings that levies are based on rather than the technical side of things which actually is really not amenable to all that much change. So it is great that that change has been made by the select committee. The funding policy statement will then be tabled in Parliament and I think that is a very useful stage in the process. I want to take that further still and say that once that statement has been tabled in Parliament it should then be subject to parliamentary debate. I am not sure whether it is the place of this bill to make that explicit or whether Parliament needs to express to the Business Committee and to any future Business Committee that it is the expectation of Parliament that there should be debate around that policy statement but it should certainly occur.I just want to say something briefly around the residual levies process. The changes that are being made in the bill and actually improved by the select committee are sensible ones. But there was also an important submission made by New Zealand Council of Trade Unions around occupational disease and the poor basis that exists in legislation and in ACC processes for setting levies appropriately to deal with occupational disease. The advice the select committee received was that that was outside the scope of this bill. I guess I have to accept that. But if that is indeed the case then it now becomes incumbent on Government and on this House to create a process where it is appropriate to discuss the ongoing basis of funding occupational disease claims appropriately. It is certainly my hope that one of the things that can come about as a result of this bill is perhaps a cross-party negotiation so that we can achieve some consensus around the basis for ACC going forward that enables us to discuss those outstanding issues—the culture of disentitlement the basis on which occupational disease will be dealt with and potential expansions of the scheme—as was originally intended. In other words we should be creating the basis and creating the platform for us to return to honour that original ACC social contract and to return integrity to the scheme. Thank you.