Editorial: ACC sickness payouts too costly

Last updated 05:00 10/11/2012

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OPINION: ACC was a revolutionary concept when it was introduced 40 years ago. Originally envisaged to end anomalies in the way workers were compensated for injuries on the job, it was soon expanded to include non-earners in a no fault scheme that commands broad, and rare, support across the political spectrum.

Now, Labour ACC spokesman Andrew Little wants it expanded further to include workers who are incapacitated because of ill health. He says it is unfair that someone who has to stop working as the result of an accident is covered by ACC, while someone who has to stop working as the result of sickness or disease gets nothing.

On the face of it, Mr Little is correct. It does not seem fair, for example, that a building site worker who is severely disabled as a result of a fall would be entitled to ACC coverage while someone doing the same job on the same site, and who is disabled as the result of a stroke, gets nothing.

However, the reality is that ACC is essentially a system of compulsory, and collective, income protection insurance. In order to keep levies to an acceptable level, New Zealanders have chosen to restrict it to injuries caused by accidents, in the same way as motorists wanting to keep a lid on their insurance premiums elect to take out third party policies instead of full cover. Despite the royal commission that led to the birth of ACC suggesting sickness and disease should eventually be included, successive governments have not gone down that path simply because there has not been a public clamour for them to do so.

The reason for that is obvious. Excluding workers whose incomes are affected by ill-health might be unfair, but including them would certainly be unaffordable.

Even within ACC as it presently exists, there is unfairness aimed at controlling costs. Cover for mental injury, for example, is not comprehensive, and is restricted to cases in which it is the result of sexual abuse or assault or due to a physical injury.

If Mr Little wishes to spark a debate on the future of ACC – he has also called for full funding to be dropped – it would be helpful if he spelt out in detail exactly what extending the scheme to cover illness and disease would involve. Would it cover, for example, only workers who are permanently incapacitated as a result of ill health, or also those off work sick for only a few weeks or months?

If it is the former, then how is that fair, when ACC injury cover includes workers who are only temporarily off work? If it is the latter, it will mean a big hike in levies.

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Also, why draw the line at workers? Many present ACC entitlements include non-earners and injuries outside the workplace, so why would it be fair to restrict cover for health issues to the employed?

Without those details, it is impossible to gauge how much extending the scheme would cost. However, it is likely that even in its narrow application, it would result in levies rising significantly. That risks a loss of public support for a scheme which, while perhaps not entirely fair, has served New Zealand well.

IN PRAISE OF ... CRAFT BEER

IS not that long ago that New Zealanders were defined as much by their choice of beer as their choice of car. Holden or Ford? DB or Lion?

The sale this week of pioneering Dunedin brewery Emerson's to Lion is a reminder of how much the beer scene has been transformed by the craft beer industry. In place of two ubiquitous brands of insipid New Zealand draught, beer drinkers can now choose from a lengthening list of offerings: malt-driven stouts and porters, crisp pilseners and hoppy pale ales and indian pale ales, not to mention weird and wonderful experimental concoctions cooked up by brewers in their spare time.

Brewing appeals to our No 8 wire mentality. It's the new winemaking with the added benefit that getting started is simpler and cheaper. It's also becoming big business. While total beer sales are declining, sales of craft beers are rising exponentially – which explains why Lion, to the horror of some purists, has swooped on Emerson's.

However, those affronted by the sale will have no shortage of alternatives. The industry is growing like topsy. Keeping track is almost as difficult as keeping up with what's happening in the wine industry. But that's part of the charm. There's always something new to taste

- The Dominion Post

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