Govt signals around $1b of ACC levy reductions

Continuing improvements in ACC provide an opportunity for significant levy reductions to benefit businesses and households, ACC Minister Judith Collins says.

“The Government is confident that a decrease in ACC levies is sustainable and is allowing for a reduction of around $300 million for 2014/15, increasing to a reduction of around $1 billion in 2015/16,” Ms Collins says.

This follows a $630 million reduction in levies for households and businesses in 2012/13.

“Over the past year, ACC has focused on regaining the trust and confidence of New Zealanders and on improving the service it provides to claimants.

“I am very pleased to see ACC continuing to work on these priority areas and investing in better quality outcomes, improving privacy, culture change, customer service, and importantly, injury prevention.

“This is alongside continuing high performance in its investments. At the end of February 2013, ACC’s investment returns were $1.1 billion ahead of budget.

“This continued improvement reflects prudent management of ACC, particularly given its new leadership and the significant challenges it has been dealing with.

“The potential 2014/15 levy reductions would leave around another $300 million in the economy for businesses and families.

“The Government is currently working with the ACC board to review its funding policy, with the aim of improving the governance and transparency of the levy-setting process, while ensuring that it reflects the Government’s objectives for the ACC scheme.

“Already there is general consensus that the improved performance of the ACC scheme makes substantial levy reductions appropriate and sustainable. Therefore, I am signalling a likely further reduction from 2015/16.

“Final decisions on levies for 2014/15 will be made later this year, following public consultation.

“The future for ACC is bright and will be of significant benefit to households and businesses alike,” Ms Collins says.