Thursday, November 12, 2009

Worked out your ACC account yet?

Maintaining existing ACC levies under the current regime is clearly unsustainable with expenditure doubling over the nine years of the Labour government against inflation over this period of only 30%. 

It is clear that ACC should be substantially reformed and opened up to competition. Employers should have a choice of cover and benefits with policies that recognise good management practices. With the tail of economic crisis still with us, now is the time to curtail the entitlement mentality by qualifying and capping claims to affordable levels. The costs of maintaining the current bureaucratic regime would appear to be out of sync with the benefits delivered. 

While motorcycle enthusiasts have grabbed headlines rallying against proposed hefty ACC increases, media reports on the proposed levy increases to businesses have kept a relatively low profile.

So what are the proposed ACC increases?

According to the Tourism Industry Association (TIA), the accommodation sector will be facing a levy hike of over 80%. Other "tourism operators" will also face substantial levy increases of between 30% and more than 100%.

The TIA along with other trade associations have spoken on our behalf, however their stance is somewhat disappointing. They have simply rolled-over and have accepted that the tourism industry should absorb these increases. Their only concession is to suggest that the increases should be staged to give the industry time to manage and adjust.

The Motel Association of NZ has other priorities and doesn't appear to have a position on the proposed hefty increase in levies to be imposed upon its membership? 

The industry inactivity/acceptance of ACC's proposed increases to be imposed on its members is disappointing. The only voice of reason that has been reported has been from Hospitality Association NZ chief executive Bruce Robertson that urged ACC to undertake a rigorous cost-cutting approach.

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