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The case for a Royal Commission into Accident Compensation, Disability and Income Support

by Hilary Stace

In 1967 Owen Woodhouse proposed a principles-based comprehensive no fault compensation scheme. The principles were: 

  • Community responsibility,
  • Comprehensive entitlements,
  • Complete rehabilitation,
  • Real compensation,
  • Administrative efficiency.

It was a world-leading vision but one which has never been fully implemented. The Accient Compensation Commission was established in 1973, but has only ever partially addressed the Woodhouse principles.

Previous Labour government ministers Geoffrey Palmer, Ruth Dyson and Iain Lees-Galloway left the work required too late in their terms for significant extensions to be implemented. Dyson and Lees-Galloway both said they doubted public support for change. But a large number of media articles shows public support is now building.

The ACC Act is long and complex, full of amendments, and susceptible to cutbacks which take years to patch up. For example, Nick Smith’s 2010 cuts to entitlements have still not been addressed.

In his 2018 Sir Owen Woodhouse memorial lecture, Sir Geoffrey Palmer (who started his career assisting Woodhouse) outlined what was still required to implement Woodhouse’s vision, and described a simple comprehensive universal system of disability and income support. 

The ‘window of policy opportunity’ is opening. This current government has started to tackle the big issues of education, health and welfare. A major reform of the health system was announced last week, although ‘disability’ has been parked for a few months as it requires more work.

Government policy now encourages ministries and ministers to work together. There is now the same Minister (Carmel Sepuloni) for ACC, Disability Issues and MSD, and the Minister of Health (Andrew Little) is a former ACC board member who has in the past supported extension/reform of the scheme. The ACC policy team in MBIE has been strengthened and the Finance minister has expressed an interest in expanding social insurance. 

The Christchurch terrorist attacks highlighted the inequity in the way those witnessing violence but not physically injured are not covered by ACC. The issues raised by the mosque terror attacks were covered in a recent interview on Radio NZ with Andrew Little and Susie Ferguson. (Incidentally Susie Ferguson chaired a disability election forum last year in which the topic of extending ACC to non-accident disability was strongly supported.)

Other examples of significant inequities include whether a person’s need for a wheelchair is because of a traumatic spinal cord injury (covered by ACC) or an illness or congenital condition (not covered by ACC and reliant on rationed/means tested support through Ministry of Health/ Work and Income). These disparities in support and income are currently lifelong and have a significant impact on individual’s health and wellbeing. There are also gender and ethnic disparities in coverage.

The 2020 Labour Party election manifesto included:

Labour will also work to return ACC to its original purpose of assisting all New Zealanders who have had an injury

This will involve:

Addressing the changes National made when last in office, which unfairly disadvantaged tens of thousands of disabled workers

Considering the range of conditions ACC covers and taking an evidence-based approach and updating the list of chronic illnesses caused through workplace exposure to harmful environments

As part of the welfare overhaul, Labour will examine inequities between support through ACC and the welfare and health system for disabled people and people with health conditions

We will also continue the business transformation of ACC to support a customer centric approach to engaging with clients, business customers, health providers and transforming ACC culture.

As various inequities are becoming newsworthy and politically challenging, the time is now politically palatable for an independent ‘Woodhouse Part 2’ Commission of Inquiry or a Royal Commission. This could also look at what new funding arrangements would be required. Sir Geoffrey Palmer is the perfect person to head it, or he should at least be consulted about who would be suitable.

We currently have a Royal Commission on Historic Abuse but it was only established after many years of lobbying politicians and advocacy by survivors of state care and their allies. The election of the Labour-led Government in 2017 presented a window of policy opportunity for its establishment. The time for an independent inquiry reviewing ACC with a view to recommending one equitable, sustainable and future-proofed universal system of disability and income support has now come. We must then be ready to have input into possible Terms of Reference to make the most of the opportunity.

An advocacy group ACC Futures is holding a forum in Wellington on 30 April looking at various ways to re-envisage ACC for the 21st century. 

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