Workers’ Compensation Bill Passes The House

Wanganui Chronicle, 24 November 1950, Page 6

Workers’ Compensation Bill Passes The House

Number Of Amendments Moved By The Opposition Defeated

PARLIAMENT BLDGS.. Last Night (PA)—The House of Representatives tonight passed the Workers Compensation Amendment Bill, a measure which restores to private companies a right to accept workers' compensation for accident insurance. This class of insurance, under an Act passed by the previous Government, was a monopoly of the State. The Opposition moved a number of amendments to various clauses of the Bill, but these were all defeated, the voting being on party lines. The very setup of the Workers' Compensation Board would ensure that abuses would not creep into the svstem, said the Minister of Labour (Mr. Sullivan) in reply to the second reading debate on the Bill. The Minister said that the aim and object of the board would be to reduce premiums and he had been assured by all with whom the legislation had been discussed that a genuine attempt would be made to reduce those premiums. Mr Sullivan said that the Labour Department would continue to pursue the efforts at present being made to curb the accident rate in industry. "We have not gone far enough in this matter," said the Minister. "Bu: the Workers' Compensation Board has authority to make contributions to t department to help it meet the costs of research involved."

The Miniser said he had every confidence that once the board was established ando functioning it would be '"a very good thing’’ for all concerned. The Bill was given a second reading and the rest of the afternoon was devoted to discussion in committee on the short title, which was passed before the tea adjournment.

AMENDMENT WITHDRAWN

An assurance that he would obtain the advice of the Crown Law Office on a point raised by the member for Riccarton (Mr. McLagan) was given by Mr. Sullivan when the Bill was further discussed in committee.

Mr. McLagan moved an amendment to the clause in the Bill setting out that the contract of insurance was to be complete on the delivery by the employer of the required wage statement to the insurer. The amendment provided that the insurer would not be able to repudiate a cover for any subsequent increased liability and that the insurer would not have power to insert in a policy anything to absolve the company from the payment of any additional benefits. such as were proposed in the Bill. Mr. McLagan withdrew the amendment on the Minister’s assurance that the Crown Law Office would investigate the position. Another amendment was moved by the member for Hutt (Mr. Nash) which sought to restore the right of an employer to appeal to the insurer or to a magistrate against the premium he was required to pay. The amendment also provided for the decision of the magistrate to be subject to appeal to the Compensation Court on any question of law or fact. Mr Sullivan said he could not see the need for the amendment. The rates as fixed by the Workers’ Compensation Board would be recommended to the Government for final approval. The board fixed the maximum rates which could be charged. The Prime Minister (Mr. Holland) said the Bill was one of the most important of the session and had been prepared with . great care, because everyone wished to see that the workers received proper compensation if they were unfortunate enough to

STATE DEFENDED

suffer an accident. The Government would, therefore, consider any worth while suggestion, even if it originated from the Opposition. He thought, however, that in this case the amendment was needless. There were 43 insurance companies competing for the business and employers not satisfied with the service given by one company could insure elsewhere. That choice did not exist under the State monopoly. Moreover, there would be a fixed ceiling above which no company could charge and there seemed no point in providing for an appeal against the assessment of premiums.

Mr. Nash said the Prime Minister's ' argument did not bear analysis. Over a period of five years the companies , paid out 47 per cent, of their premium income in compensation, whereas the State, in its initial period, paid out 70 per cent. That suggested the desirability of a right of appeal against premiums fixed by the companies. The Minister of Health (Mr. Watts) said there was no appeal right ' against the fixed rate or schedule rate before 1947, and there was no appeal under the present State monopoly. Mr. Nash said employers were again being put at the mercy of private firms and the Bill would be improved by giving a right of appeal. Mr. Holland, in a tribute to the insurance companies, said competition would ensure much better service. Under the existing State monopoly there was no more variety of service in compensation insurance than in going to the post office to buy a twonenny stamp. Mr. McLagan (Opp., Riccarton) said the post office gave only one quality of service—the best. The competition between insurance companies lauded by Mr. Holland would in fact be collusion, as had been the case in the past. Premium rates would be agreed upon. The experience in other directions this year had been that competition increased prices instead of reducing them, and if the fixing of premium rates was left to “free collusion" the rates would be unjusti-> fiably high. The House divided on Mr. Nash S amendment, which was defeated by 36 votes to 29. An amendment was mo ,’ed by Mr. McCombs which he said was designed to make it profitable for employers to have an accident, free factory by allowing special rebates to those who went out of their way to reduce the accident hazard. It amounted to an incentive payment for safety, said Mr. McCombs. , , .. A division was called for and the amendment was rejected again by a vote of 36 to 29. . . The Opposition called for division on Clause 22, which provides that insurance companies wishing to engage in compensation insurance may notify the Secretary of Labour of their intention to do so after paying the required deposit. The clause was retained bv 37 votes to 29. . Mr Skinner (Opp., Buller) moved an amendment seeking to give representation on the Workers’ Compensation Board to companies not members of the Fire and Accident Underwriters’ Association of New Zealand, I but the amendment was defeated by 38 to 29. „ . A further division challenging another clause in the Bill resulted simiThe Bill was then put through the remainder of the committee stages and passed.