What to do about ACC?

It may be that Judith Collins was handed the ACC portfolio as a poisoned chalice, to kill off her leadership pretensions. If she manages to do a good job of it, on the other hand, it may prove to be the opposite.

Once the scandal about leaks of personal information, emails, etc, has died down, the real test for Collins will be to turn the ACC ship around, get it performing satisfactorily for New Zealanders (not just for Treasury), and above all get it off the headlines.

If she were to ask me (yeah right!), I'd recommend that the first step is to delete the section of the ACC law that requires the scheme to be fully-funded. It's this unnecessary policy that is at the root of the problems. It was Labour that first put that requirement into law, but my hunch is that, provided the Minister were serious about genuine culture-change at ACC, they'd now support its removal. Treasury would probably not like that idea, on the other hand; and it would require a change in the way ACC figures are presented in the government's balance-sheet. But tough.

We don't yet know, however, what Collins means by 'culture-change'. She may have in mind something worse than before! (If they're a nuisance, put the claimants in the Crusher?)

There are, however, some matters (aside from privacy) that do need to be addressed:

1. The balance between controlling long-term 'tail' claims and claimants' rights to fair, genuine rehabilitation needs to be more sensitively negotiated. Rehabilitation and the return to employment and social activity were always at the heart of the Woodhouse vision for ACC, but so was the elimination of litigation between the claimant and administrators. Claimants should be focussed on return to work, and not on doing battle with the Corporation.

2. There needs to be fairer policy around that grey area between the effects of aging (or degeneration) and the effects of personal injury caused by accident. As I recall from the Trapski Report 1994 (which looked into some troublingly similar concerns), the 'egg-shell skull' principle should apply. That is, even if a person has a non-injury-related degenerative or congenital disorder that has exacerbated the harm caused by an accident, the compensation authority is bound to cover the injury and its consequences as they find them. Having said that, ACC law is clear that it does not cover age-related or degenerative conditions on their own.

3. Claimants need to have confidence that 'independent' medical assessors (presently chosen and paid by ACC) are genuinely independent enough to give the best possible medical opinions, devoid of influence from either the claimant or the Corporation.

4. The new ministerial appointees to the Board, and the CEO that the Board will hire, will be crucial. Reporters and bloggers will be scouring the CVs of all new top-level appointments to ACC, and questions will be asked about their expertise and about the policy intentions signaled by their selection. That could be the next big political test for Collins – as well as the turning-point (up or down) for ACC itself.

Enough for now. ACC was never insolvent, it is affordable, and it is cheap compared to other countries.