Coleman Jonathan: Injury Prevention Rehabilitation and Compensation Amendment Bill — First Reading 
Coleman Jonathan: Injury Prevention Rehabilitation and Compensation Amendment Bill — First Reading 
[Volume:634;Page:6017] 
Dr JONATHAN COLEMAN (National—Northcote) 
: 
 It is a pleasure to speak in opposition to the Injury Prevention Rehabilitation and Compensation Amendment Bill. I must say that I think the arguments against it have been very well canvassed by my colleagues Dr Paul Hutchison and Dr Wayne Mapp and also by Heather Roy. 
I think that fundamentally we have a situation that encapsulates some of the philosophical differences between Labour and parties that are of a centre-right persuasion. On the one hand the Labour Party wants to put forward this legislation that will make accident compensation less efficient. Labour will undermine workplace safety and it will try to impose a one-size-fits-all solution on everyone in the workplace. We know from experience that that will not work. On the other hand National and ACT are advocating for more competition in accident compensation. We believe that the changes in 1999 although they were in place for only a very brief period made some real differences in accident compensation and in the workplace. The premiums were lower there were incentives for people to look at workplace safety and the system was working more efficiently than previously. The reality when looking at insurance is that if we do not have incentives people will not ensure that workplaces are safe. Everyone will be paying one high premium to a monopoly provider—the situation that we have now—and there will be no incentive for competition in the sector and for enhanced safety in the workplace. 
One of the really concerning things about this legislation is the way it is being rushed through. There is a normally accepted period of 3 months for consultation on changes to accident compensation levies yet twice in the space of a couple of weeks legislation is being rushed through without the normally accepted consultation period. It is legislation that will not be in the best interests of the country. 
I think there is quite a parallel between this bill and the revalidation legislation that was before the House last week. A tired deceitful Government was pushing through legislation to make the illegal legal. I can say that if any of the Labour members have been out in their electorates—those who have them—over the weekend they will know that the revalidation legislation is going down very poorly out there. It will be the nail in the coffin for a lot of the Labour members who sit in the Chamber today. It is striking a very negative chord in the heart of New Zealand society. People are not happy about it. They are seeing this Government as an arrogant tired Government that is trying to absolutely run over the will of the people. I also believe that a lot of the members of the Labour caucus are not very happy about what we have seen in the past week in this House. It has been disgraceful. It has been unprecedented in the history of the New Zealand Parliament and the people of New Zealand will not stand for it. 
It is not very surprising that New Zealand First is supporting the Government on the bill that is before us today. Last week New Zealand First was very happy to support totally undemocratic legislation that made the illegal legal. It was an unprecedented move and that party will be out of this Parliament in 2008. It will disappear. 
R Doug Woolerton 
: We’ll be here. 
Dr JONATHAN COLEMAN 
: Mr Woolerton will not be here reading his newspaper and snoring away on the cross benches. He will be gone as well as some of the Labour members. 
I come back to the bill. The Government’s proposal to merge the two accounts will result in the socialisation of costs and the benefits of accident compensation. It reflects a move away from the clear incentives that are provided by an insurance-based approach. We in the National Party are clearly very opposed to that. In 2008 when we are back in Government we will reintroduce the privatisation of accident compensation and reintroduce competition to the sector because we know that when that was the case in 1999 both premiums and accident rates fell. Labour wants to take a flat approach; Labour wants it to be cost-plus. It does not see the connection between risk and premium. Labour does not recognise that if someone works in a high-risk occupation that person should pay a higher premium than someone who does not. 
It was interesting that when the Minister spoke—she took the first call—she talked about self-employed people. I think it really illustrates how little the Labour Party really understands about self-employment. She says in the explanatory note of the bill that self-employed people are clustered “in particular high injury risk industries and occupations (such as forestry fisheries and farming).” That might have been the case 40 years ago but I can tell members that time has moved on. That sort of thinking takes no account of the fact that many self-employed people now work in fields such as catering the professions and information technology. In fact thousands of people in this country are employed in information technology. Why should people who are employed in low-risk professions like information technology or catering pay the same premium as people who are foresters or fishers? That just does not make sense. 
This bill also shows us that Labour is fundamentally anti-business. It does not want to see any differentiation between people who are putting themselves out there running a business and taking all the risks. It wants to see them pay exactly the same premium as people who are not putting themselves at risk. There will be cross-subsidisation and no strong incentives. This law will not reflect the degree of risk that individuals are taking. 
It is sad that under Labour New Zealanders do not have a choice of insurer when it comes to cover for personal injury. Labour and its union mates want to have a monopoly model in this sector and they want that to continue. They have socialised insurance rather than following basic insurance principles. We have to ask ourselves why after 7 long years in Government Labour is so eager to rush this legislation through in the space of just a few short months—there is a 3-month period before it comes into effect—without giving the New Zealand public the right to be heard on the matter. The unpalatable fact and the unpalatable answer are that this legislation is all about preparing accident compensation for life under a National Government. It will set up an environment whereby it will be a lot more difficult for private insurers to enter the market in 2008 and to make it work. 
Is not this bill all about the Accident Compensation Corporation (ACC) positioning itself for the potential competitive environment once the electorate has finally rejected this tired worn-out Government this deceitful Government this Government that frankly people have had enough of? How exactly will ACC be preparing itself for that change in 2008? Basically ACC will move as many claims as possible to the residual account which it can control now and it believes well into the future. The corporation and the Government do not believe in and will not accept the residual account ever being put out to competition. They will greatly reduce the number of claims under the employers’ account management framework and that will take claims away from the management of employers who are presently within the ACC Partnership Programme. Finally they will reduce the rating structure by a number of means. They will move claims to the residual account discount the rate now and then progressively increase it over the following years and they will remove the rate stability level. They will transfer the liability to the residual account but not the collected premium and there is something deeply wrong with that. All of that will result in fewer claims and a lower rate in the employers’ account and thereby a reduced premium pool. The upshot of it all is that it will be a lot more difficult for private insurers to enter the new market and to make it work when National becomes the Government in 2008. 
So there we have it. A clear philosophical difference between the two major parties surrounds this bill. Members of the Labour Party do not believe in competition. They want everyone to be the same. They believe in a cost-plus mentality and they do not want competition in insurance. The National Party and ACT want to see competition in accident compensation and we will make sure that come 2008 with the change of Government that is exactly what happens.