#7 - Mark Woodard 2008-07-18 07:43 - (Reply)

I have noted with concern these proposed policy changes. As a voter ‘up for grabs’ in the next election, let me say that your stated position would absolutely result in my vote going to another party. First, one must acknowledge some significant shortcomings in the ACC system, including the potential for bloat and the skewed effects on the health system for ‘injuries’ as compared to ‘illnesses.’ Nevertheless, I feel ACC is a particularly important national resource – and reflection of Kiwi culture. I am a US native, and have noted many salutary differences between New Zealand and the US. One of the most significant is the twin, related characteristics of: a Kiwi willingness to front up and apologise when appropriate; and an absence of a litigation and blame culture. In the US, one is directed to always, always avoid admitting responsibility on pain of litigation to determine fault. If an accident occurs and there are insurers with an incentive to avoid claims payment are involved, it is inevitable that disputes will arise over who must pay. Lawsuits follow quickly, legal costs escalate and a culture of ‘shutting up’ prevails. Ironically, in the US it has become clear that this approach to avoid admitting blame actually results in more anger and frustration; doctors have found that admitting errors actually reduces malpractice suits. Nevertheless, the practice of avoiding blame is now deeply rooted, as in the famous US Presidential statement “mistakes were made.” The New Zealand context is different, as Kiwis are expected to take responsibility and apologise, if appropriate. This salutary cultural characteristic is certainly not achieved in every case and is difficult to maintain, but as a matter of policy it is important not to put barriers to its continuation – such as insurers setting premium differentials based on those who admit responsibility and subsequently pay claims. Or worse, insurers battling it out among themselves over who must pay when an accident occurs. The concept of ACC was a masterstroke at avoiding this whole slippery slope, and is unique in the developed world. I fully support the concept of ACC – if not all of its policies and approaches. I note also, in passing, other key benefits of the ACC system: • The likely breakdown of the insurance system over time as higher risk entities drop out or find ways to minimise their participation in compulsory regimes. • The inability of multiple commercial insurers, each with a relatively small market share, to take the long view and make investments for the benefit of the whole population over time. • The reality of the NZ insurance market is that it is quite small, with only a few participants. Trading a system with one participant in which government – our elected officials – has a responsibility to oversee it for one in which there are likely at most three or four participants with limited oversight does not seem to be automatically superior. In my view, any gains from privatising some or all of ACC are likely to be transient and illusory, and the costs – social and economic – to be long standing and significant. Let me be clear that I have no association with ACC or the sector, and I will be sure to consider National in the next election if you can address these significant concerns.