Firms to benefit from ACC changes
Cuts to Accident Compensation Corporation (ACC) motor vehicle levies and the introduction of risk ratings for cars are likely to benefit businesses with fleets, while most motorists will miss out.
Public consultation has started on a proposed drop in ACC levy rates for the next financial year of 15 per cent off motor vehicle and earners' levies, and a 17 per cent drop in the average work levy paid by employers and self-employed people.
Average petrol and motorcycle safety levies are expected to remain unchanged.
ACC is planning to base risk ratings for cars on real-world crash results, which would mean people with "safer" cars would pay less.
While no-one would pay more than they do now, people with safer cars will pay less in levies than those driving cars deemed riskier.
Automobile Association principal adviser Mark Stockdale said he supported giving people incentives to buy safer vehicles. However, the average New Zealander could not afford to own a new or late-model car.
In New Zealand 80 per cent of new cars were purchased by businesses for fleets and the average age of cars was 13 years, he said.
Stockdale said the difference in levies between categories was relatively small, with people whose vehicles were deemed to be the safest saving about $100 a year in ACC levies.
It remained to be seen whether the risk rating would have a significant bearing on motorists' vehicle-purchasing decisions.
There were safer vehicles in every budget category, he said. While charging based on risk was a new concept for New Zealand, it was common overseas.
Consumer NZ research and testing manager Hamish Wilson said the risk rating would end up as a tax on people who could least afford it. "People who drive around in older, riskier cars drive around in those cars because they can't afford newer cars."
However, he said the logic behind the proposed changes seemed "pretty reasonable".
ACC was relying on a testing model used in a study by Australia's Monash University.
The corporation said it had engaged the university to expand its methodology to include 95 per cent of the light passenger vehicle fleet in New Zealand - about 2.6 million vehicles.
Some new and rare vehicles did not have sufficient crash information to be categorised and would go into the second-safest risk group until a score could be assigned, ACC said.
Very few of New Zealand's passenger vehicles would fall into this category.
Wilson said the risk rating system favoured vehicles that did the least damage to the driver and passengers and these vehicles were typically larger or newer.
Bigger cars used more petrol and had a more severe impact on another driver in a crash and it would be fairer if ACC reduced the levy for everybody, he said.
BusinessNZ chief executive Phil O'Reilly said the proposal to introduce risk rating was a positive move, as safety features in newer cars could significantly reduce the number and severity of road injuries.
ACC chairwoman Paula Rebstock said various changes had been made to levies because of ideas raised by the public as part of the consultation process. Public consultation on the proposed levy rates is open until October 15.
- © Fairfax NZ News