ACC fracas ‘truly dumb’

Written By: - Date published: 2:51 pm, October 20th, 2009 - 5 comments
Categories: ACC, articles - Tags:

Tim Hazledine, a professor of economics at the University of Auckland, has a nice piece in the Herald today that lays out just how absurd National’s spin about the ACC “blowout” really is.

Suppose you and your spouse are in charge of a family of, say, three young children. That means you are legally responsible for bringing them up to school leaving age and morally responsible for helping them in further training or education after that.

So how much is this going to cost you? A lot… It all adds up to many hundreds of thousands of dollars of expenditures. And just how are you planning to pay for this?

You need to be able to show unencumbered funds of at least half a million dollars right now to guarantee the future income stream necessary to meet your obligations to your children.

And you haven’t got that, have you? You’ve got about $20,000 in KiwiSaver accounts. You’ve a bit of equity in your house, but, hey, you can’t bring up your children in a tent, can you? Let’s face it. Strictly speaking, you are broke; busted; bankrupt. And so are several hundred thousand other New Zealand families just like you – billions of dollars of unfunded liabilities, in total.

It’s the “biggest loss of any entity, public or private, in New Zealand history”, to slightly paraphrase Dr Nick Smith on the $4.8 billion “loss” recorded last year by the ACC. If you think this is silly, then the ACC fracas is truly dumb.

If ACC’s broke then so is every family in New Zealand. Perhaps we should hand the whole country over to the Australian insurance industry.

The fact is there is no crisis at ACC. Nick Smith and John Judge have tried to convince us there is one by exploiting public ignorance over how full-funding works. It’s the oldest trick in the book – bandy around a few big numbers, call it a ‘blowout’ and then build the case for major reform.

Don’t let them play you for a sucker.

5 comments on “ACC fracas ‘truly dumb’”

  1. TightyRighty 1

    turning into a one issue party over here isn’t it? you should rename yourselves “the standard of acc”

    [It’s the single most important political issue at the moment. If you don’t like it, don’t read. I can’t help notice though that you have no critique beyond empty National Party talking points.]

  2. Walter 2

    And I am still having absolutely no luck explaining this to my Nat voting friends! Time and again I try to explain it, and the best I get is, “I suppose it all depends on how you look at it.”

    I guess the alternative proposition, that our duly voted in government is owned by overseas corporations is just too fantastic to believe.

    This whole thing sickens me. I’ve been invited to join the protest and ride my (motor) bike to parliament in protest of the fee increases. But I get the feeling the more we squeal, the more we are playing into their hands. What can we do?

    F**ked if we do – f**ked if we don’t.

    Well played National, you’re not as dumb as you seem.

  3. BLiP 3

    And then on the opposing page you have the New Zealand Fox News Editorial describing National Ltd®’s plans to introducing a $100 charge for making a claim as “brave”.

  4. dan 4

    Part of the problem Labour had at the last election was the notion it was “time for a change, give the other team a go, we’re fed up with Helen and her lot”!!!

    The hassle was that there were nine years worth of new voters who had never experienced the gauchness and fundamental greed of the NACTS. They had not experienced Ruth Richardson or the mindlessness of the electricity reforms.
    And now we have Murray McCully, running around like the spoilt brat young Nat that he was, bullying his way through the rugby shambles; Nick Smith, totally out of his depth; and Nat HQ paying back the Insurance boffins for their support in the election.

    I would agree the Labour needs to be making more noise. There is so much that is wrong at the moment that they should be having a field day. The support for ACC as it is is coming from people right across the spectrum. It is only the idealogues, and the need to pay back the overseas-owned insurance companies for their electoral support, that is driving the Nick Smith nonsense.

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