Motorists will be better off to the tune of $135 a year on average under ACC levy cuts confirmed yesterday but levy reductions for workers and employers recommended by the corporation have again been sacrificed to help the National Government balance the books.
Prime Minister John Key yesterday announced the Government's Budget plan for $480 million of cuts next year would go ahead. About $432 million of that will come from motor vehicle levy reductions including a 3c a litre petrol tax cut, and reductions in vehicle licensing fees based on the safety rating of the vehicle.
The balance of the reduction comes from a cut to the work account levy paid by employers and self-employed people from 95c per $100 of liable earnings to 90c.
However, ACC itself had recommended $658 million in cuts including a 20c reduction in the work account levy and a 6c per $100 of earnings cut to the earners account levy paid by employees as well as the motor vehicle levy reductions.
ACC Minister Judith Collins was upfront about why the Government had ignored ACC's recommendation for bigger cuts for the third year running.