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Press release 16 April 2009

OECD prescription for ACC would be a step back for NZ

The OECD prescription for ACC would be a backwards step for New Zealand according to the ACC Futures Coalition.

Spokesperson Hazel Armstrong said that it was deeply disappointing to see the newly released OECD economic survey on New Zealand reaching for the tired and failed policy of opening up selected accounts to private competitors. “This form of privatisation was tried in the 1990s and the results were bad for both consumers and health treatment providers, while even employers strugged to manage the confusing and inefficient outcome.”

“It is also deeply disappointing to see the OECD blindly accept the view that ACC is in serious financial trouble and that this is due to problems associated with a public monopoly not managing costs,” said Ms. Armstrong. “We know that the financial issues ACC is currently facing are primarily due to the global financial crisis reducing earnings, and changed accounting standards. Where costs have risen this has reflected improved entitlements established by government in accordance with the underlying principles of ACC. There are legitimate conversations to be had about all these issues but neither wholesale cuts in entitlements as we saw in the early 1990s, nor privatisation of the work or other accounts, is the way to go.”

“The ACC Futures Coalition does not accept that ACC is a wildly inefficient scheme as implied by the OECD. One of the underlying principles when the scheme was established was administrative efficiency and a public monopoly was deliberately chosen as the best vehicle for delivering that,” said Ms. Armstrong. “The PriceWaterhouse Cooper’s report from last year made it quite clear that ACC was very efficient when compared with equivalent schemes internationally.”

“New Zealanders need to realise that we have a worldclass scheme and it is ours. We need to promote and defend it in the face of superficial analyses such as that provided by the OECD here and reckless proposals to privatise any accounts by opening them up to competition,” said Ms. Armstrong.

The ACC Futures Coalition, which was launched recently, consists of academics, consumers, health treatment providers and unions who have come together around the following aim:

To build crossparty support for retaining the status of ACC as a publiclyowned single provider committed to the ‘Woodhouse Principles’, with a view to maintaining and improving the provision of injury prevention, treatment, rehabilitation and ‘no fault’ compensation social insurance system for all New Zealanders.

12:00AM Sunday, 19 April, 2009

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