Tabuteau Fletcher: Accident Compensation (Financial Responsibility and Transparency) Amendment Bill — First ReadingText is incorporated into the Bound VolumeTabuteau Fletcher: Accident Compensation (Financial Responsibility and Transparency) Amendment Bill — First Reading[Sitting date: 02 June 2015. Volume:706;Page:4210. Text is incorporated into the Bound Volume.]FLETCHER TABUTEAU (NZ First):I do actually stand in support of this piece of legislation. It is the first reading and it is definitely a piece of legislation that needs to go through this stage and into the select committee process because as noted in the stated objectives within the legislation itself we do need a higher level of transparency and accountability. There does seem to be an element of debate—and I would actually agree with my previous colleague’s position—about a level of redundancy in regard to the legislation itself in its entirety. As section 6 of the Accident Compensation Act does point out decisions around these areas can be made already the scheme has to be fully funded and it does give account to the fluctuations already in terms of the levy itself. So I do worry that the bill as insinuated earlier actually kind of gives another level for the Minister to come in with this legislation where it is not necessary and it just adds to the complexity and takes away from that transparency and accountability that we were talking about.However the stated intent of this bill is “to improve the framework for determining how ACC’s levied Accounts are funded so it is clearer more transparent has a longer-term focus and supports more stable levies:” and very important “to ensure that the residual levy is not over-collected.” I stand here on behalf of New Zealand First and say that those goals and those stated aims are to be highly commended. If that is what we are seeking to do with this piece of legislation then New Zealand First could not be more supportive.ACC itself just recently re-evaluated the liability of the three accounts that it manages and so we know that the specified amounts defined by the Acts are actually no longer relevant. New Zealand First believes that the objectives are on track like I have just said. This legislation in its stated aim is doing the right thing. We would insist though that the residual levies on the earners account the motor vehicle account and the work account should be collected only until the costs of shifting to the lifetime cost model are absolutely required and obviously no longer. In undertaking this legislative change ACC and the Minister will be required to be more transparent and consultative in the way the current levy regime is set. New Zealand First suggests that the more the public and those who are involved or affected by ACC can be involved the more seamlessly this process will work.But there are several issues to consider and it has been spoken about tonight already about putting ACC as a whole in context—a recent history if you will. The other is to ensure that going forward this Government actually chooses what we would consider to be the right option and not any option to facilitate these changes. The Government has a very poor record when it comes to ACC. It has abused the ACC system ignoring good advice and subsequently has overtaxed New Zealanders by stealth.The average New Zealander especially small business has borne the brunt of this deliberate inaction. Mr Foss for example has a small-business development group whose purpose is to advise the Government on small-business issues but he has not had the ACC conversation with it. The reality is that the burden that business has had to bear because of this Government’s inaction has been huge. Further he admitted to this House that he has not advocated a reduction in levies with this Government’s Cabinet. Broadly speaking everyone in this House knows—and ACC has stated unequivocally for some time now—that the levies paid by businesses especially the self-employed need to be reduced.It has taken far too long. There is no doubt that reducing red tape and improving cash flows are critical issues for small business. The Government has sat on this opportunity to help small businesses for far too long. That refusal to budge has been costing businesses and individuals thousands a year. The frustration out there is palpable. New Zealand First insists that these changes not only in terms of the general levy but the residual levy are well past due and our New Zealanders have been paying into ACC at too high a level for far too long.Additionally this Government is well aware that over-collection especially in the work account is creating distributional consequences that create constraints on the equity and the incentives for some of our businesses. The Government knows that there is no justification for creating this distortion given that the repayments are actually now well ahead of schedule. The Minister for ACC needs to be reminded that the residual portion of the work account is spread across businesses based on risk relativities that are actually now 10 years old in their calculations.The identified problem is a large one. Given a legislative stop date of 2019 by current rates of collection the Government will have over-collected $852 million from the work account $155 million from the earners account and $468 million from the motor vehicle account. I do not think that anyone in this House would agree that this should be allowed to happen and I acknowledge that that is why we are here today.Let us be very clear: there has been next to no time for this consultative process especially around the residual levy collection. It has been put to this House that the residual levies be discontinued by Order in Council but New Zealand First wants to point out the reality of the Government going down this path—that is if we actually acknowledge that some of the debate tonight has been fair and relevant because it is still in debate whether in fact this legislation is needed in the first place. But that is what consultation is about and I acknowledge that from here we go to a consultative phase.New Zealand First disagrees in principle with these council structures and legislation. I have stood up many times and spoken out against this method of consultation and interference with the process with Government entities State-owned enterprises and the like. It gives too much power to the Minister and his or her chosen few. Give the Minister the power to make this decision and unsurprisingly it has been stated in the consultation that there are concerns around additional risks on transparency and certainty.Putting these calculations and dates into legislation now would actually achieve the goal as set out by this Government which New Zealand First does applaud. Continuing to collect the residual levies given in the legislation cannot be justified because it would be a disincentive to businesses that are working to lower their operational risks. But because the residual levy component is so high as a proportion of the total levy collected any discounts that businesses are entitled to are actually barely noticed when they do their job right. At the moment because the residual levy is such a high proportion of the total levy counted it takes away the incentive to make those changes. The incentives are not there yet. So in bringing the residual collection date forward we actually support and reward businesses for undertaking their business in a safe and professional manner. Making this change in legislation would mean it would be debated in the House and would be offered to a select committee round and therefore the implications would be made clear through the debate and submission process.Business needs certainty to operate. We need to be certain about what it is that this Government is hoping to achieve and New Zealand First puts it to the Minister and to this Government that the best way to do that is actually by legislating the date now. Do not give the power to the Minister to act ad hoc. It is even noted that in doing so the time line may in fact be pushed out. We support this bill through to the select committee. Let us have the debate. Let us see whether this legislation is actually needed and New Zealand First reserves the right to consider the opinion of businesses and New Zealanders from that point. Thank you.