The Future of ACC: for ACC to Survive It Is Necessary That 'Gap-Fillers' Continue to Narrow Its Scope of Coverage

Abstract

New Zealand will celebrate the golden anniversary of the Accident Compensation Scheme’s (ACC’s) founding document before the end of the decade. ACC continues to fascinate and divide academics, politicians, and voters. Since ACC’s 1974 introduction there have been numerous changes to the Scheme. In considering the future of ACC I have divided this essay into two parts. In the first part of this essay I argue that, in order to survive, ACC must become more limited in its scope of coverage. Some restrictions of ACC’s scope of coverage are already occurring. These restrictions reflect changes in the socio-economic factors that led to the creation of ACC, which were: population size, economic situation, left wing political ideology and a collectivist society. In the second part of this essay I argue that ‘gap-fillers’ continue to narrow ACC’s scope of coverage. ‘Gap-fillers’ are an alternative way of providing accident compensation to ACC. The accident compensation provided by ‘gap-fillers’ generally benefits those accident victims who also have ACC coverage. The argument in the first part of this essay, that narrowing ACC’s scope of coverage is necessary for its survival is constructed in two steps: firstly that narrowing ACC’s scope of coverage reflects changes in the socio-economic factors that led to the Scheme’s creation, and secondly that ACC’s ‘community responsibility’ concept means that narrowing its scope of coverage is necessary for its survival. Narrowing ACC’s scope of coverage ensures continued societal acceptance of ACC’s ‘community responsibility’ concept. As ACC’s core value, the ‘community responsibility’ concept cannot be separated from ACC without destroying the Scheme. By ‘community responsibility’ concept I mean in broad terms that the community should be responsible for paying the costs of people’s accidents. This concept reflects one of the 5 principles listed in the Compensation for Personal Injury in New Zealand Report (Woodhouse Report). The Woodhouse principles provide the framework, and consequently the intended scope of ACC’s coverage according to the Woodhouse Report. In part two of this essay I argue that ‘gap-fillers’ continue to narrow ACC’s scope of coverage by breaching the Woodhouse principles. ‘Gap-fillers’ include: the endurance of exemplary damages, testing the boundaries of the statutory bar against awards of compensatory damages, victim compensation in criminal cases, and government payouts additional to ACC payments.