Damien Grant: ACC has taken a turn for the worse

ACC Minister Judith Collins. Photo / Ross Setford

In 1974, we gave up the right to sue for personal injury in return for a benevolent government department that would take care of us when we were injured.

How has that worked out? The ACC is enduring some undeserved criticism for being mean to fit people choosing to linger on the corporation's largesse.

The ACC's annual reports make it clear that these delinquents are responding to a harder line and are moving off the ACC's books.

This is not a cause for criticism; this is a cause for celebration, even if some of these professional beneficiaries have managed to transition to the less generous sickness benefit.

The ACC is getting some additional free publicity over its offer of $250 compensation to weeping invalids who are meant to have had their privacy breached when Bronwyn Pullar was inadvertently emailed their names.

Sure, that was a blooper, but in a world where people post pictures of their genitals on Facebook, the idea you are entitled to compensation because your name is in a spreadsheet, that no one you know saw, is pathetic.

Of more concern is the ACC's insolvency.

Under the fully-funded model adopted in 1999, the corporation has liabilities of nearly $27 billion, this being the future cost of providing for all those who have claims.

To cover this cost, the ACC has only $20b in assets, and, disturbingly, a quarter of this is Government debt.

The ACC is a government department. It is an accounting fiction to record an inter-departmental balance as an asset; the corporation is $12b in the hole.

Twelve billion. I cannot comprehend that number, my brain is too small, but if we have three million taxpayers that works out to $4000 each. I can understand $4000 and I know a Ponzi scheme when I see one.

To plug this gap, the ACC is fee-gouging. Last year it collected $4.8b in revenue and paid out $2.5b in claims. No insurer in a competitive market could sustain such margins.

In addition to being a financial disaster, the ACC has been plagued by allegations of poor customer service, denying legitimate claims and, most recently, psychological testing of claimants.

We should not be too quick to criticise; a frontline job at the ACC would be enough to turn the sweetest maiden into a hardened shrew but the ACC is a monopoly and monopolies have a deserved reputation for shocking customer service.

So, how it is working out? You cannot sue. It can be hard to get a legitimate claim paid. You are being overcharged and you cannot choose an alternative insurer. It is time to abolish the scheme; let the lawyers and the insurance firms back.