ODT on ACC

Today’s ODT editorial:

There is no doubt the Accident Compensation Corporation faces considerable funding challenges, but such is the intemperate tenor of ACC Minister Dr Nick Smith’s pronouncements and actions – the latest being his unheralded and reportedly overbearing appearance at the transport and industrial relations select committee last Thursday – the suspicion arises he is unduly trying to “soften up” the public for as yet unannounced and radical changes to the scheme.

I doubt there will be radical change. For the most part the Government is doing what Labour would do – increasing levies and delaying the date we move to full funding. But there may be some pruning of the scheme – but this would merely take it back to where it was a few years ago – hardly a radical change.

Even the possible competition in workplace insurance cover is far from radical, and was explicitly mentioned in the pre-election policy.

Dr Smith and, to a lesser extent, Treasurer Bill English, have been right to draw attention to the problems at ACC.

Former finance minister Michael Cullen and ACC minister Maryann Street were technically exonerated in a report released last week of obscuring the corporation’s true financial position for the pre-election financial update, but National may have genuine cause for alarm at the “hospital pass” it has received over the state of ACC’s finances.

However, Dr Smith is almost certainly incorrect when he says ACC is “technically insolvent” and with his more extravagant pronouncements appears to be gilding the lily.

With a new chairman and board appointed, he needs to tone down the rhetoric and get on with sorting out the problems – in a calmer and more confidence-inspiring manner than he has done to date.

The status quo of $47 a week levy increases for the average household is clearly unacceptable.