Change in Levy Collection Makes Better Business Sense

Address to announce transfer of collection
3pm
ACC Boardroom, Shamrock HouseMolesworth St, Wellington

Thank you for giving me the opportunity to speak to you, some of our key stakeholders, on the transfer of the residual claims levy from the Inland Revenue to the Accident Compensation Corporation.
The Labour-Alliance Government believes in the future of ACC and this transfer is a reflection of that trust.
The transfer indicates ACC’s continuing effort to streamline its business practice.
I have taken on the role of Minister for Accident Insurance at a very positive and progressive time for the Corporation.
ACC has been back in the employer accident-cover fold for almost two years now and has clearly showed that its costs can be lower than the private insurance market.
ACC now offers employers cover at an average rate of 85c per $100 of employee wages – compared to the private insurance level of $1.20 -$1.25.
The transfer of responsibility for collecting the residual claims levy from the Inland Revenue to ACC is just one more step in ACC carrying out its own business.
The residual claim levy is something that confuses many employers – especially when they get one bill from ACC and then another turns up from the Inland Revenue for what appears to be the same thing.
Although the residual claims levy is a separate component of cover, the current dual invoicing process is not necessary.
When ACC was re-instated into the employer market it started collecting its own levies for Employer and Self Employed, however the residual component remained with the Inland Revenue. As ACC now carries out most of its own invoicing it is not necessary for ACC to have the Inland Revenue act as an agent on its behalf to collect the residual claims levy.
Obviously, it makes better business sense for ACC to take control of the residual claims account and integrate the billing into one invoice.
One invoice for one business from one source.

A very important driver for this change in collection is that it will reduce compliance costs, as this was a recommendation of the Business Compliance Costs panel. And we see those compliance costs savings being achieved as a result of single-source billing, and having one source of data retention and maintenance.
Although ACC is taking care of its own business more, we still have a very important partnership with the Inland Revenue.
The Inland Revenue will still collect levies on ACC’s behalf for the Earners Account and continue to supply ACC with information.
The residual claims levy transfer becomes effective on 1 April 2002. Thank you.