Smith fails to make case for ACC privatisation

Nick Smith’s blind faith that the market will deliver lower cost accident cover for employers isn’t supported by any real evidence, says Labour’s ACC spokesperson Chris Hipkins.

“Today in Parliament I asked Nick Smith if he expected his ACC privatisation plans to result in lower costs for employers. He said he did, but failed to name any other country in the world that offers accident cover at comparable levels to ACC at a lower cost.

“That’s because there aren’t any,” Chris Hipkins said.

“Nick Smith keeps resorting to beating-up a supposed crisis in ACC’s finances in order to discredit robust, independent research that shows ACC already provides the cheapest cover for work-related accidents in the world.

“The private insurance industry has already said they don’t think they can provide cover as cheaply as ACC because they will have to build in setup costs, profit margins, costs of capital, tax, and other expenses that ACC doesn’t face.

“National’s decision to privatise work-related accident cover is a purely ideological decision. They simply haven’t produced any evidence to suggest it will be cheaper.

“Employers can also take cold comfort from Nick Smith’s less than equivocal commitment to allow ACC to continue to compete in the market. The insurance industry is already lobbying to shut ACC out altogether and there is every possibility the government will acquiesce to their demands.

“Labour has made it very clear to the private insurance industry that they will invest in providing work-related accident cover at their own risk. A future Labour government will reverse this ideologically motivated reform,” Chris Hipkins said.