Competition for ACC?
October 17th, 2009 at 10:04 am by David FarrarNational actually won an election mandate for introducing competition and choice to ACC. It shouldn’t need ACT to push it in that direction.
The 1998 changes were a win-win. Not only did employers get choice, and lower levies, but workplace accidents fell as other insurers provided incentives to employers to have safer workplaces.
Related posts:
- National’s ACC policy
- Rewarding safe workplaces
- Reason #51 to change the Government
- Experience rating for ACC
October 17th, 2009 at 10:07 am
In the place I worked when the company took cover with a different insurer than ACC, we got software installed on our machines that made us take compulsory micro-pauses and a five minute break fro the keyboard every hour. You could put it off for a couple of hours but in the end it locked your PC. When we went back to ACC, all that went by the wayside. As a worker, the private insurance route made for a better work environment in my case.
Vote:October 17th, 2009 at 10:17 am
You are so correct David: The Nats shouldn’t need Act to push them in the direction this country needs to go but they do! I hate to say it but Key is beginning to look like Helen with a slightly larger appendage and straighter teeth.
The same old we know best (Anti-smack), the smell of snouts in troughs (English, Smith, Lee etc) having to help out incompetent (possibly dodgy Ministers [Coleman]) all I wait for is retrospective legislation.
Oh Wait? Maybe this is a cunning plan to look like Labour Lite so that MMP is thrown out OR this is a cunning plan to move so far to the left that Act gets over 10% and shores up the right?????????
Either way i am still waiting to get what we voted for!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!
Vote:October 17th, 2009 at 10:20 am
All of the above.
The reason ACT exists is because Gnational is so spineless. This is just another example of their wimpishness.
Vote:October 17th, 2009 at 10:47 am
Couldn’t agree more, get some spine Nats, at least introduce policys in ACC that incentivise safe behaviour.
Vote:October 17th, 2009 at 10:53 am
Thank you for stating explicitly what many of us fear some of your preferred government wish to do – privatise ACC so the finance sector can appropriate profits from what will inevitably over time be a reduced and poorer quality service. Equally, however, I don’t understand why you agreed yesterday with Mr Hooten about the ‘audacity’ involved in a Left narrative about privatisation. There is nothing audacious in such a narrative, as you illustrate with this posting. It is a simple fact – National would like to privatise ACC, but is profoundly worried about the political fall-out of such a measure. It will be calculating the risks of that fall-out as it develops its manifesto for the 2011 election. And Mr Key, vital for electoral success, is proving to be too pragmatic (so far) when it comes to the neo-liberal agenda. It is so obviously galling for many on the Right.
[DPF: You need to learn the difference between privatisation and competition. No one is selling ACC and no one would want to buy it. Competition gives customers choice. For example we have three stated owned energy generators, but also some privately owned ones. This does not mean Meridian is privatised - it means you have competition and choice]
Vote:October 17th, 2009 at 10:55 am
“but workplace accidents fell as other insurers provided incentives to employers to have safer workplaces.”
I would be interested to see the data for this statement. Is it a global figure or an accident rate figure? Did the rate of declined claims increase? As it is obvious privatisation is once again on the agenda, and someone on just the average wage is already paying $1000/year to ACC, it is a debate worth having if we could just get full disclosure. But do facts ever get in the way of ideology?
And isn’t it a shame that employers (humans) need incentives to provide safe workplaces for their employees (humans).
Vote:October 17th, 2009 at 11:06 am
National are proving to be wimps. They have a mandate to get the country moving. That means policies other than Labour-Lite. I don’t expect anything to change so roll on the next election when those who are disappointed can shift their votes from National to ACT and thereby inject some focus and spine into the government. Until then I fear we will tread water, or more likely continue to go backwards despite the commitment to catch Australia.
These fine sounding targets are all cool until it comes to policy time then they go weak at the knees and just sign on to continuing Labour’s legacy. Wonderful!
Vote:October 17th, 2009 at 11:15 am
We’ve already given ACT our party vote and look forward to doing so again in 2011.
Vote:We fully intend to give The National Party MP’s a corrective smack on election day.
I just hope enough Kiwis have the balls to do the same and kick it to the liberal lefties in National & Labour instead of moaning at their dinner parties and doing the same old same old.
October 17th, 2009 at 11:23 am
Mr Winter arrives on cue with his Hitlerite lies. (See Chris Trotter)
The word competition is not spelt with a P, Mr Bullshit artist Winter and you mate Luc.
MikeNZ, a hell of a lot of your collectively smacking mates appear to be telling that nice Mr Morgan something different.
Vote:October 17th, 2009 at 11:27 am
LUCY (284) 7 0 Says:
October 15th, 2009 at 7:52 pm
In the late 90’s the National Government changed the law to allow employers to have a choice as to the type of provider they wanted. They could stay with ACC or go with a Private Insurance company.
I was contracting for a large company (5000 employees) and they chose to go private. The costs to the company were 60% of those charged by ACC. We monitored the provider closely and I can honestly say that the service and coverage was superior to that provided by ACC.
ACC lost 90% of its customers. The scheme worked very well.
What did Uncle do as soon as they were in power?Changed the system back to a state monopoly within a year.
Why cant National change it back? It was proven to have worked.
I posted that on the 15 Oct.
I now think the answer may be that no private company would be prepared to cover the ‘entitlements’ the taxpayer has to fork out for and National knows that.
Instead of taking a hard line and cutting riduculous ‘entitlements’ so it can be put out to competition they have put it in the too hard basket along with every thing else.
And before you lefties start jumping up and down yelling about ‘selling off the family silver (-not) please note that opening it up to competition is not selling it off. If ACC is a good scheme it will survive and Im sure you will all be happy to put YOUR money where your mouth is and support it. If it doesnt survive well………………….
Vote:October 17th, 2009 at 11:33 am
Lucy – the problem is that the family silver, in most cases, it silver plated junk and not really worth the effort of keeping other than for sentimental reasons.
Vote:October 17th, 2009 at 11:36 am
Ignoring the whole PWC report which states the status quo is the most beneficial outcome from NZs interest.
Vote:October 17th, 2009 at 11:40 am
Brian Smaller (1899) 1 0 Says:
October 17th, 2009 at 11:33 am
Lucy – the problem is that the family silver, in most cases, it silver plated junk and not really worth the effort of keeping other than for sentimental reasons.
Brian Never a truer word was spoken!
Vote:October 17th, 2009 at 11:52 am
I think you’ll find the PWC report (which I’ve read but don’t have time to dig out just now) was favourable towards non-workplace insurance staying centrally provided, but opening up workplace risk & injury insurance to competition.
Vote:October 17th, 2009 at 12:07 pm
getstaffed, see how they lie?
Vote:October 17th, 2009 at 12:28 pm
“National shouldn’t need ACT to push it in that direction.”
Spot on. Apparently someone needs to remind the incompetent Nick Smith that a previous National government opened ACC to competition.
It’s time his boss, “Malleable” Key finds a replacement for Smith, the unabashed tree-hugger.
Vote:October 17th, 2009 at 12:57 pm
Good intermediate steps would be to open up work place cover, also sports organisations etc ie any who runs an ‘affiliated membership’ would run their own accident cover as part of their subscriptions. This will automatically incentivize the more injury prone sports to manage the safety of their participants rather than having all the patronizing ACC promotional blather.
In due course the public can decide whether the benefits of private cover should be spread to personal injury. There is no particular reason why a private market in cover cannot operate in a ‘no personal fault/ non-lawsuit’ legal context, this would still be far more efficient and just to individual claimants than the present ACC which bears all the hallmarks of successful socialization of risk and of what happens when you treat people as population groups rather than as individuals.
Vote:October 17th, 2009 at 1:03 pm
DPF said: …workplace accidents fell as other insurers provided incentives to employers to have safer workplaces.
Do you have any evidence of that DPF?
And wouldn’t workplace accidents also fall if employers and their insurers collaborated to deny that there was any injury at all or, if that couldn’t be denied, to deny that it happened at work? There is plenty of financial incentive for both employers (lower premiums) and insurers (lower claims expenditure) to do that.
And they did do that in 1999-2000 when private insurers were involved in workplace injury insurance. I know this because I was working as a claimant advocate at the time and had to deal with numerous instances where claims for workplace injuries were wrongly, and I believe deliberately wrongly, declined.
Vote:October 17th, 2009 at 1:21 pm
@DPF: one understands the difference between competition and privatisation, and one also understands the fundamental neo-liberal opposition to state ownership of any provision (even in situations of market failure). I do not doubt that a competitive model is possible, but, if enacted,as a stepping stone to a preferred private-sector delivery model. It is the political fall-out of sich a transition that haunts neo-liberalism – it can’t win elections on that basis (at least, under MMP).
@Adolf Fiinkensein: ad hominem, so either rattled or simply grumpy.
Vote:October 17th, 2009 at 1:36 pm
Funny old question.
My wife works in a medical center. Apart from the numerous sprained wrists, broken bits etc from sports and workplace injuries, they put all sorts of other things on ACC.
Girl after girl comes in wanting an abortion.
I’m wondering, who pays for these – are they covered by ACC?
If so, what the hell for? There’s definately “fault” there – the guy and the girl both for not using “protection”!
Open it up to competition.
It annoys me that I look after myself, minimise my risk at work and play, have only ever made 2 (minor) claims when I worked on a farm as a teenager, and I’m paying for all these ridiculous entitlements.
Rufus
Vote:October 17th, 2009 at 1:52 pm
“if employers and their insurers collaborated to deny that there was any injury at all or, if that couldn’t be denied, to deny that it happened at work”
Do you have any evidence that such illegal and immoral activity would actually occur inside NZ, toad? Doesn’t sound like the NZ I know. Might happen elsewhere, but in my experience, NZ’s employers don’t actually operate along such Dickensian lines as you seem to suggest they would, if given the slightest opportunity.
Vote:October 18th, 2009 at 8:44 am
Robert Winter, can you speak plain english? I want to understand what you are saying because I enjoy a good debate but why all the 10 syllable words?
Vote:October 18th, 2009 at 11:46 am
ACT should push national further than just opening up the employers part of ACC to competition, they should open up every part of ACC to competition. I would rather have my family and I be able to go through normal underwriting for Accident insurance. This could be modeled similar to kiwisaver where the default insurer is the government run ACC but with the option to change if the individual wishes to. This would also have the effect of making people live safer in an effort to decrease their premiums.
Vote:October 18th, 2009 at 11:50 am
Robert Winter – I hate it when idiots refer to market failure. “Market failure” is more often than not a case of market correction. And this correction, more often than not, is required because idiotic governments intervene in markets to achieve some sort of social goal, eg, forcibly loosening lending requirements in america for certain demographics.
Vote:October 18th, 2009 at 12:49 pm
Welcome to socialist wealth transfer, rather is poorly disguised as insurance
Vote:October 18th, 2009 at 2:50 pm
Employer costs may not go down for GP visits this time round. Last time the private ACC insurance was a complete administrative debacle – injured people would turn up at the ED or their GP without knowing their insurer, or having the correct forms. Even if they did the forms were cumbersome triplicate jobs, and even once computerised, the insurance paperwork typically took quite a bit longer than the consultation.
By the time ACC took back over again, many GPs had begun to charge for their time on a pro rata basis, and the costs per consultation to employers was double, occasionally treble, that of a normal consultation.
Also, insurers often were slow to reimburse practices, or failed to do so at all, inviting service refusal from practices.
Vote:October 18th, 2009 at 4:22 pm
@ jackp: a fair point, courteously put. I will try harder
@ CharlieBrown: presumably, then, most economists are also idiots (which you may well think), for most orthodox economists recognise that markets rarely, if ever, function perfectly (hence the orthodox focus on imperfect competition) and that ‘perfect’ information is also rarely, if ever, possible. Interestingly, you presumably think the two recipients of the Nobel Economics prize this year are idiots too, for both, in different ways, are responding to imperfections in the market. Hmm – apologies to jackp again.
Vote:October 18th, 2009 at 5:25 pm
Robert Winter… define market failure and try to apply it to the recent recession? And to be honest I hadn’t even heard of those two recipients of the prize, and anyway, going by recent cases, the norwegians are losing their knack at handing out nobel prizes to deserving recipients.
One of the most respected schools (Austrian) of economic thought considers market failure to be a fallicy, so I am not alone here. Others (eg, Milton Friedman… one of the greatest economists of our time) believe that market failure is usually preceded and caused by a failure of government.
Vote:October 18th, 2009 at 9:29 pm
I am spewing, one of the substantial reasons I voted for National was for the ability to choose my own insurance cover and level of cover. I am sick of being raped by ACC. Thieving, inefficient bastards.
Vote:October 18th, 2009 at 9:37 pm
kaya, you obviously didn’t check out the policy detail sufficiently before the election, so I hope you have a big chunder bucket while you are spewing.
National only ever promised to “investigate” private insurance competition in the work account. They have investigated, and have decided it is not a runner at present. Now Rodney has spat the dummy.
Yaboosucks!
Vote:October 18th, 2009 at 11:49 pm
@CharlieBrown: notwithstanding Von Mises, Hayek and others, the Austrian School is a minor player in contemporary economics, compared with mainstream, orthodox neo-classical economics, which offers a variety of definitions of market failure, You are perfectly able, I am sure, to explore these via the Internet. However, the current recession is full of examples of imperfect information (deliberate and systemic), which, if addressed, might have caused people to act differently, be it in terms of borrowing or investment behaviours. Empirically, most international institutions – OECD, World Bank, IMF, dor example, most central banks, most Treasuries and Finance ministries have supported the need for intervention to rectify market failure in the last two years.
Elinor Ostrom is perhaps less known in economic circles (but very highly regarded elsewhere), but Oliver Williamson has been a major international figure in Economics for many years.
Vote:October 19th, 2009 at 1:10 am
Theres no such thing as “market failure”….it makes as much sense as “nature failure”. As in nature (which the free market is actually part off…being the natural way free people interact with each other when guns and Governments aren’t threatening them to act otherwise)) the market just IS….If a tree was struck by lightning we would not call that a “failure of nature”..it IS nature,tress and lightening are natural occurances….and lightening destroys trees when it hits them.So it is with the market….when a business falls over or someone gets rich by inventing the better mousetrap thats the market at work….either way.
Also the lefty notion of “perfect information’ is bullshit too……all a person needs to know is the market price of something.He doesn’t need to know that a cold front destroyed the Brazillain banana crop….only that the price of bananas has gone up in his local supermarket and that he has a choice about wheather to buy them or not.
Vote:October 19th, 2009 at 9:04 am
@ James: it is surprising the number of acolytes of the Austrian School in the thread. It is a pity, then, that most economists (and economic policy makers) think you are wrong. And by any standards, the idea that perfect information is ‘Lefty’ is odd. It is, of course, a classical feature of market-based economic theory of all sorts. And the idea of ‘price’ as a single dimension factor, about which more information is unimportant, is again something lots of people would challenge. For example, the ‘price’ of an invedstment is not reducible simple to a figure, as, for example, the Chicago finance tradition (the one that is in some ways at the root of the current crisis) shows.
The funny thing about this exchange is that I think much of the reasoning that I have laid out is wrong, but for quite different reasons. One simply likes one’s opponents to be represented fairly.
Vote:October 19th, 2009 at 9:35 am
toad – my decision was based on a response to an email I sent to Pansy Wong. She clearly gave me the impression that opening ACC up to competition was one in National’s plans. Weasel word politicians.
Vote: