Self-employed face rise in ACC levy

By KEVIN TAYLOR

About 70 per cent of New Zealand's 300,000 self-employed will be paying increased ACC premiums from April 1.

The Government said yesterday that the self-employed levy on each $100 of payroll would rise on average from $1.35 to $1.75, particularly affecting forestry and farming, which have high accident rates.

Levies for the self-employed were reduced from $1.85 in 1999-2000 to the present $1.35.

The Auckland Regional Chamber of Commerce chief executive, Michael Barnett, accused the Government of reneging on its promise when it renationalised ACC that prices would remain competitive.

The rises would hit self-employed people who, while not contributing greatly to the economy, were not a drain either.

Accident Insurance Minister Lianne Dalziel blamed the rises on increased numbers of claims.

Of the 300,000 self-employed in New Zealand about 70 per cent would pay levy increases and the rest would have levy cuts or no change.

The increases were criticised by farmers, who face rises of around 40 per cent.

Federated Farmers president Alistair Polson said the rise reinforced farmer concerns at having no choice of accident insurer.

While no farmers would be forced off their land, he said, their costs would increase.

Mr Polson was also concerned that a 15 per cent margin had been built into levies.

He agreed that injury rates were too high among farmers, but Federated Farmers was working with ACC to reduce them, and the injury rate was slowly declining.

Ms Dalziel said the Government had adopted a precautionary approach after last year's $313 million ACC loss.

It was not prepared to have ACC draw on its reserves again this year.

ACC was preparing a safety campaign targeting the self-employed to lower the cost of the account after a 40 per cent average monthly rise in the number of claims by the self-employed compared to the year before.

"But it's not just a financial issue here - we are talking about people's lives," she said.

Ms Dalziel also announced that employer average levies would stay unchanged at 90c for each $100 of payroll.

She said the decision to not change the levy went against recommendations from ACC and the Labour Department to lower it to 85c.

Business NZ said that while it was good news that employer levies would not rise next year, they still did not accurately reflect the state of the accident insurance market.

Executive director Anne Knowles said the rate had a substantial margin built in, which, with a reduced number of workplace accidents, could not be justified.