THE PRESS MONDAY, FEBRUARY 23, 1987. Time to review A.C.C.

Press, 23 February 1987, Page 20

THE PRESS MONDAY, FEBRUARY 23, 1987. Time to review A.C.C.

The report that the Accident Compensation Corporation has had to borrow “significantly” more than $6O million to cover a shortfall in its reserves is no surprise. In December, when the Government replaced most of the board’s members and when levies on employers were trebled, it was clear that the reserves were going to run out before the end of the financial year. Wherever the fault for it lay, this sudden lack of cash is a hiccup 'in a system the principle of which is accepted now by all reasonable people. Despite the abuses that have shown up in practice, the scheme is still remarkably cheap. In Australia, for instance, the levy for workers’ compensation, which covers employees only while they are at work, is more than double the New Zealand rate, even after the recent increases. This is not to say that adjustments to improve the scheme do not have to be sought and implemented. Employers, for instance, have expressed resentment at having to pay to cover sport and domestic injuries. For sports injuries, a touch of the user-pays notion seems necessary. It would not cover every activity, of course, because so much sport and recreation is unorganised and the business of fairly collecting revenue would be extremely difficult.

A levy made through clubs should not be impossible to collect, and applied on a scale graduated according to the risk of injury; with mountain-climbing, say, at the top, lawn bowls at the bottom, and everything else somewhere in between. People who engage in sport do so knowing of the risk; it is only fair they should pay something directly towards the cost of that risk when relief, in

the event of mishap, comes from the State. People who take their pastimes less strenuously may validly object to underwriting those who seek a thrill. Smokers and drinkers are rightly compelled to pay high taxes to allow for the damage they inflict upon themselves; why not those who engage in hazardous sports also? Employers pay on a scale according to occupational risks. The same idea should be considered for recreation.

The only possible alternative payer for domestic injuries is the general taxpayer. A new tax is highly unlikely in an election year, but the idea of spreading the load a little more evenly through the population has appeal and could be examined later. Another aspect of the scheme, and one that as much as anything got the commission into financial bother, is the loading of unemployment benefits on to the scheme. Rehabilitation was the main mission of the A.C.C. If, after an accident victim has been restored to good health, a job is not available, the charge for the benefit should fall upon the Department of Social Welfare, not upon the commission’s funds.

The accident compensation scheme has been analysed and criticised by officials, politicians, and interested parties at great length. It may be that, after running for more than 10 years, the scheme should be subjected to a cool, detached scrutiny by an impartial, independent individual or group. It was, after all, established after just such an inquiry by a judge of the Supreme Court. Ultimately, though, the decisions on how to run the scheme and how to pay for it are political ones.