ACC Increase & Labour Party

[Grumpy Gnomb]

Was just wondering if the increase in the ACC Levy was as a result of how the previous Labour Gov't was running it and were the hiding the fact just how much it was in the crap as this would not have happened over night.

To increase by the amounts suggested is also not the right way to fix the problem, as that is a knee jerk reaction and not well thought out.

Under a previous National Govt, the ACC was privatised so is this way to go again??

Something needs to be done, but what and how is the big question and we all need to be involved as it affects us all sooner or later

[vifferman]

Most of the problem is due to the so-called "credit crisis" and poor fund investment choices. ACC doesn't just take money in then pay it out - the money is invested in funds, just like with other insurance schemes, so that they (hopefully) have a buffer against an unexpected and exceptionally large number of claims.

[Mully]

I agree with Vifferman - while Labour failed to disclose the extent of the problem, the blame can't be laid at their door entirely.

Privatisation will probably still happen, IMO. Whether it happens before or after these hikes in fees depends on affected parties (i.e. bikers) taking appropriate action.

[riffer]

Also, ACC has been changed from working like a superannuation scheme, where you have to have enough reserves to cover the claims in any one year, to like an insurance scheme where you must have enough reserves to cover all claims in future and past.

To illustrate, previously, if you broke your back in a bike accident, ACC needed enough reserves in 2009 to cover your claims for that year. Say if you were 30, there would be a reasonable expectation that you'd live to see 75. Also they would expect it would cost at least $50,000 a year to see you right.

Now, they have to have enough reserves in hand NOW to cover you until you are 75 at the date of injury, which means they now need to have 45 X $50,000, or $2,250,000.

Big difference.

They also have to cover all the historical claims now too (the full amount).

See how it adds up fast?

It's like a change in how we do the book-keeping. All of a sudden everything looks bad.

Funny how you can make okay look horrendous just be re-interpreting your statistics.

[Marmoot]

Was just wondering if the increase in the ACC Levy was as a result of how the previous Labour Gov't was running it and were the hiding the fact just how much it was in the crap as this would not have happened over night.

The blow out apparently happened last year. But unfortunately I couldn't remember who was running the government last year and the 3 years leading to that.

Actually...it could be the socialist axis of greens, maori party, and labour combined, playing blind Robin Hood to rob from the poor, distribute to the voters. (Because robbing the rich is more difficult)