Hawkins George: Injury Prevention Rehabilitation and Compensation Amendment Bill — Second Reading 
Text is incorporated into the Bound Volume 
Hawkins George: Injury Prevention Rehabilitation and Compensation Amendment Bill — Second Reading 
[Sitting date: 19 June 2003. Volume:609;Page:6433. Text is incorporated into the Bound Volume.] 
Hon GEORGE HAWKINS (Minister of Police) 
 on behalf of the 
 Minister for ACC 
: I move  
That the Injury Prevention Rehabilitation and Compensation Amendment Bill be now read a second time 
. This bill performs a number of functions. Its primary focus is to establish an Accident Compensation Corporation petrol levy and to provide for changes to that levy. Previously an accident compensation “amount” was collected alongside the petrol excise duty but it was not an Accident Compensation Corporation levy. Consequently it was not possible to change the petrol amount without either making legislative amendments to the Customs and Excise Act or alternatively affecting Crown revenue. 
The bill will enable changes to the rate of petrol levy without requiring further legislative amendments. It will also ensure that the fiscal impact of raising the petrol amount is not borne by the Crown. That change was to be introduced in the Injury Prevention Rehabilitation and Compensation Act. However technical errors in the drafting of that Act meant that the intended changes were not given effect. 
By establishing the petrol amount collected alongside the petrol excise duty as a petrol levy the bill also sets the levy at 5.08 cents per litre. It enables the levy to be applied to petrol and any other category of fuel that may be prescribed by regulations therefore providing for any future contingencies. It provides for the levy to be amended accordingly through regulations and provides for regulations to be created to administer the refund of the petrol levy for off-road commercial uses of petrol such as in farm vehicles marine vehicles and other machinery. 
The last function the bill serves is unrelated to the Accident Compensation Corporation’s motor vehicle account. The bill reverses changes to the accident compensation appeal regime that came in by way of the District Courts Amendment Act 2002. The bill preserves the requirement under section 162 of the Injury Prevention Rehabilitation and Compensation Act and under section 165 of the Accident Insurance Act that leave of the District Court is sought prior to an appeal to the High Court. The retention of that requirement to obtain the District Court’s leave ensures that a significant filtering mechanism remains in place and that the costs associated with the appeals process can be managed in a practical way. 
The Accident Compensation Corporation’s motor vehicle account covers the cost of all motor vehicle - related injuries. The motor vehicle account has recently faced a significant increase in costs. Those increases have resulted primarily from improved estimates of long-term rehabilitation costs for seriously injured claimants and underlying cost increases. As the motor vehicle account has the highest proportion of serious injuries of all Accident Compensation Corporation accounts the improved estimates affect the motor vehicle account disproportionately more than the corporation’s other accounts. 
The Government considered the options on the best way to fund the Accident Compensation Corporation’s motor vehicle account in December last year following public consultation. In recent years any increases in the corporation’s motor vehicle account costs have been absorbed into the annual vehicle-licensing fee. The Government considered that the cost of vehicle licensing may have reached a point where further increases could lead to adverse social impacts. Some people already have difficulty in paying the licensing fee resulting in a number of people not licensing their vehicles. Therefore funding the increased costs through an accident compensation petrol levy is considered to be a fairer approach than increasing the licensing fee. People generally have greater choice over how much they drive and how much petrol they consume. That approach was also supported by a large number of New Zealanders during the Accident Compensation Corporation’s consultation on options for funding for its motor vehicle account. The Government also agreed with that approach and announced that for the 2004-05 levy year the petrol amount would be raised from 2.3 cents per litre to 5.08 cents per litre. 
These changes align with the Government’s intention to improve injury prevention through the development of the New Zealand injury prevention strategy. That includes reducing motor vehicle injuries as a priority. We have also developed the New Zealand transport strategy which has a strong safety focus. Further work is also being undertaken on the long-term funding of the Accident Compensation Corporation’s motor vehicle account in the light of the New Zealand transport strategy. 
Section 162 of the Injury Prevention Rehabilitation and Compensation Act requires that appeals to the High Court are either by leave to appeal being granted by the District Court or by special leave being granted by the High Court. When the District Courts Amendment Act comes into force it will remove the requirement that leave be sought so that people will be free to appeal to the High Court regardless of the circumstances. The effect is that a significant filtering mechanism will be removed. Last year for example 25 of 40 attempts to appeal the Accident Compensation Corporation’s decisions to the High Court were refused leave by the District Court. 
The High Court Rules Committee is concerned about the potential impact on the High Court’s workload as a consequence of the removal of that requirement. I am also concerned at the potential cost implications for the Accident Compensation Corporation. The Minister of Justice agrees that the amendment should be reversed. I believe that the retention of the current repeal requirements is a practical way to manage the costs of the appeals process. The bill therefore ensures that section 162 of the Injury Prevention Rehabilitation and Compensation Act and section 165 of the Accident Insurance Act which provides the same appeal process for appeals under that Act are unaffected. As the District Courts Amendment Act will come into force by Order in Council the bills’ reinstatement of the current appeal provisions is to be brought into effect by the passing of the Order in Council that brings the District Court Amendment Act into force. 
The Transport and Industrial Relations Committee received and considered three submissions on the bill from interested groups. Two of those submissions were heard orally. The themes presented in the submissions to the committee on the bill were that all submitters supported the introduction of a dedicated Accident Compensation Corporation fuel levy to fund the corporation’s motor vehicle account. Submitters differed in their ideas of how the levy should be achieved with regard to the mix of licence-fee levy and fuel amount with two submitters supporting the setting of the petrol levy at 5.08c per litre and one submitter opposing that provision. A range of views on policy issues was raised such as alternative options for risk-rating and the full funding of the motor vehicle account. 
The committee recommended that clause 4 of the bill be redrafted so that it substitutes a new section 162 of the Injury Prevention Rehabilitation and Compensation Act in place of the version set out in the schedule of the District Courts Amendment Act. The committee also recommended that provisions be added to clause 4 to provide that appeals and reviews arising under Part 6 of the Accident Insurance Act preserved by section 391 of the Injury Prevention Rehabilitation and Compensation Act are subject to the new section 162. That will ensure that the requirements for obtaining leave to appeal are consistent in both Acts. 
I support the amendments recommended by the committee. As I have outlined there are a number of reasons that this bill should proceed. On behalf of the Minister for ACC I commend the bill to the members of the House.