ACC blunder sees 15,000 denied cheaper car regos

Certain 'sub-species' of cars have been mis-identified by the ACC.

A blunder by ACC bureaucrats is denying about 15,000 motorists the cheaper car registrations promised by Prime Minister John Key.

Officials are scrambling to fix the problem but last night didn't appear sure exactly how many makes of car were affected.

The "data matching" error cancels out the savings which taxpayers stood to get out of the reduction in ACC levies, a contribution made by every motorist through vehicle registration.

The new system coming in on July 1 was meant to assign a "risk rating" to each brand of car and charge motorists less for driving safer cars.

When the Prime Minister announced the levy cuts, he said it would benefit businesses, workers and motor vehicle owners. "This is $2 billion that will stay in the pockets of Kiwis."

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ACC Minister Nikki Kaye said it introduced transparency into the levy-setting and made it "very clear in the ways that levies are set".

The error has come about because ACC's computer system refused to recognise safer "sub-species" of popular vehicles. For example, it has classified the Toyota Corolla Spacio - considered among the safest vehicles - as the marginally lower rated Toyota Corolla.

The difference would see the owner of a 2007 Spacio charged $103.46 for car registration when they should be charged $68.46.

Other makes and models of cars were also affected but ACC spokeswoman Stephanie Melville said last night the agency was not able to provide details showing which vehicles were caught up in the mistake.

She said ACC staff on the helpline number 0800 222 776 should be able to assist.

"ACC acknowledges that the data matching issue was made by ACC."

Ms Melville said it was estimated the number of vehicles put in wrong bands was about 15,000. She said a few hundred motorists were believed to have already paid incorrect amounts for registrations even though the new system is not meant to come into force until July 1.

"In conjunction with NZ Transport Agency, who collect the motor vehicle levy on behalf of ACC, we will be proactively contacting customers to refund them."

She said those who had been invoiced for less than they should have to pay would not be required to pay more.

"This issue is being fixed urgently. ACC apologises to those of our customers affected for any inconvenience this has caused."

The levy-cutting scheme has already faced criticism for targeting older cars with higher rates, bringing accusations of it being a tax on those least able to afford newer and safer cars.

Labour's ACC spokeswoman Sue Moroney said the risk-rating scheme had suffered a "chaotic" introduction. "I don't think it's been at all well-handled."

One motorist who had paid the higher rate said he was told by ACC he wouldn't get a refund.

He said his Spacio was invoiced and paid at the rate a standard Toyota Corolla was charged.