Hipkins Chris: Injury Prevention Rehabilitation and Compensation Amendment Bill — In Committee 
Hipkins Chris: Injury Prevention Rehabilitation and Compensation Amendment Bill — In Committee 
[Volume:660;Page:9167] 
CHRIS HIPKINS (Labour—Rimutaka) 
: 
 I intend to take only a fairly brief call on the Injury Prevention Rehabilitation and Compensation Amendment Bill. I know that is not something I have managed in the past but I will give it a go. I stand to say at this point that Labour supports the 24-hour no-fault accident compensation scheme which the National Government seems to be intent on undermining at every available opportunity. 
Just by way of introductory comment I say that late last year I had the opportunity to meet with some visiting US senators. They were here to look at our health system. When I asked them which two things about the New Zealand health system they were most interested in they said those were the accident compensation scheme and Pharmac. Those were the two things that they were the most envious of because they believed that if they had similar schemes to those in the United States then much of the health debate that people have there would be mitigated. So it is very concerning to see some of the provisions in Part 1 of this bill which to my mind undermine the very good accident compensation scheme that we have without a clear case having been made to support them. 
There appears to be very little evidence here and the National Government instead appears to be undermining the scheme so that it can get away with doing what it has wanted to do all along which is to introduce privatisation into the scheme to a much greater extent than currently. It seems to me that National is relying on the old Roger Douglas theory of never wasting a good crisis and if there is not a good crisis then simply trying to create one. From listening to the Minister for ACC Nick Smith speak earlier one would think that all of the problems with regard to accident compensation relate to a massive increase in the scope of the scheme under the previous Labour Government. In fact only 6 percent of the increase in liabilities I have been advised results from the increase in the scope of the scheme under the previous Labour Government. So Nick Smith’s claim that the scheme was somehow left completely high and dry by the previous Labour Government because of a massive blowout in its scope is simply untrue. 
As Darren Hughes pointed out Nick Smith appears to be arguing the same logic for cutting into accident compensation as the National Government has used for cutting into the New Zealand Superannuation Fund. He argues that because the investments that the Accident Compensation Corporation (ACC) has been able to make on the international market have gone down in value in the recession somehow that means we should make savage cuts into the scheme. Of course the New Zealand Superannuation Fund has rebounded significantly during that time. I am sure that ACC will have made back a significant amount of the losses it made as well. 
I also note at this point that Labour supports the extension of the date for the full funding of historic claims but we oppose the bill overall. If the National Government was really interested in and really supportive of extending the date for the full funding of historic claims it would have supported the bill that Labour has had in the ballot since the last election. In fact David Parker sought leave last year to introduce that bill and the National Government blocked that. So if it wanted to extend that date there was already a bill there. It chose instead not to do that and to come up with its own bill which it is using as a vehicle with which to push through a number of other changes that are detrimental to the scheme. 
I will talk about the cost of accident compensation because many of the changes that the Government is proposing are being put forward on the basis that they will lower the cost particularly for employers. When we look at the evidence of how the scheme stacks up internationally we see there is not a great deal to support the notion that employers in New Zealand are paying a particularly high cost. In fact Treasury advice to the Government stated that it is not clear that accident compensation costs are excessive. I refer to the minority view of my Labour colleagues on the Transport and Industrial Relations Committee. They noted: “At the request of the committee officials provided advice comparing New Zealand levies for employers to premiums in Australia.” The advice showed that “ACC costs for New Zealand employers are substantially lower than the costs paid by Australian employers.” I could be mistaken here but this could be one of the National Government’s key initiatives to catch up with Australia. It wants to catch up with Australia by making our employers pay the much higher accident-related levies that employers pay in Australia. I think National members have abandoned the idea of catching up with Australian incomes so perhaps they are now going to console themselves by increasing the levies paid under the scheme by our employers instead.