Mixed reaction to call for Aussie ACC

SYDNEY - A call for Australia to adopt a New Zealand-style national accident compensation regime has won support from business groups but been rejected by lawyers and some media commentators.

The Australian Plaintiff Lawyers Association labelled the New Zealand scheme an "unmitigated disaster" and the Australian newspaper said support among New Zealanders for ACC was shaky.

The call for an overhaul of Australia's state-based common law system for public liability insurance came from federal Small Business Minister Joe Hockey.

He said spiralling premium costs were crippling small businesses and he pointed to New Zealand's Government-run scheme as having merit as an alternative.

Mr Hockey blamed "greedy" lawyers for the increase in the numbers of Australians suing for personal injury - claims rose from 55,000 in 1998 to 88,000 last year.

Mr Hockey's attack was backed by retailers, tourism operators and small businesses. In New South Wales, the owner of the Big Banana at Coffs Harbour, Kevin Rubie, whose premium has jumped from $A39,000 ($NZ47,760) to $A140,000, said part of his tourist attraction would have to shut unless he got some relief.

In Newcastle, the city's skating rink was forced to close after public liability costs rose from $A8000 to $A86,000 this year, and the Tilligerry Returned Services League Sports Club has had to cancel its annual Australia Day charity day.

But the president of the Australian Plaintiff Lawyers Association, Rob Davis, described Mr Hockey's plan as silly and said it favoured wealthy business interests over victims.

He said the collapse of insurance giant HIH and the world economic downturn - not increased payouts - were causing premiums to rise.

He labelled the New Zealand ACC system an unmitigated disaster that was based on unworkable legislation and was underfunded.

But NZ Council of Trade Unions president Ross Wilson, a former deputy chairman of the ACC, said yesterday that it was not often Australians acknowledged New Zealanders were doing something better than them.

"It is not surprising that they are looking in wonder at ACC, which is delivering more compensation for a fraction of the Australian private insurance premiums," he said.

"From a worker point of view ACC is far from perfect, but business leaders should at least acknowledge that it is cheap compared with what they would be paying the Australian insurance companies who controlled the New Zealand market under the 1998 reforms."

The Australian newspaper has queried which New Zealand scheme Mr Hockey was referring to.

"Does Mr Hockey mean the original 1974 NZ socialist utopian no-fault regime that ended the right to sue over accidents and instead offered set payouts funded by employers and taxpayers?" the editorial asked.

"Or does he mean the 1982 version that reduced premiums but created a surge in unfunded liabilities to dangerous levels?

"Or is it the one that emerged in 1992 when soaring costs forced employees to pay as well, even though lump sums were scrapped, benefits reduced and a range of maladies excluded?

"Or perhaps it's the 1998 scheme started by the conservative National government, which saw private competition as the only way to reduce waste and wean some accident victims off handouts?

"Or surely not the renationalised system Labour has recently built, prompting higher premiums for the self-employed and fanning fears of wider increases. In fact, many Kiwi business people reckon Mr Hockey's preferred option should be dumped."

- NZPA