- ACC proposes annual levy rises for motorists, employers, and workers over the next three years.
- Rising injury numbers and rehabilitation costs are driving the proposed increases across major levy groups.
- Changes include higher levies for motorbikes, ballet dancers, and high-risk sports, with discounts for safety measures.
The Accident Compensation Corporation (ACC) has proposed a series of levy increases to address rising injury numbers and the associated costs of treatment and rehabilitation. The proposed changes, which could affect households and businesses by hundreds of dollars annually, are now open for public consultation.
The plan includes increases of 7.5 percent a year for motor vehicle levies and 4.5 percent a year for both employer and worker levies over the next three years. ACC says these rises are necessary to maintain financial stability as injuries and rehabilitation expenses continue to climb.
Chief executive Megan Main explained that the current levies collected were insufficient to cover the expected costs of claims. "The levies we currently collect are lower than they need to be to cover the forecast cost of claims we expect each year," she said. Despite efforts to manage costs, rehabilitation is becoming more expensive and lengthy, reflecting global trends. "It is taking longer and costing more for injured New Zealanders to recover," she added.
Although the increases may be challenging for some, Main emphasised they were crucial to ensure future claimants would not bear the financial burden of today’s accidents. Deputy chief executive Stewart McRobie noted the ACC was facing a financial shortfall of between $1 billion and $2 billion, which further necessitates the levy adjustments.
Proposed Levy Increases
The suggested increases will impact all major levy groups, with variations depending on the perceived risk of specific vehicles or activities. For employers, the levy would rise from the current $0.63 per $100 of payroll to $0.72 in 2027/28. Workers’ levies would go from $1.39 per $100 of wages to $1.59 over the same period.
Motorists face increases as well, with motor vehicle levies set to climb from $113.94 per vehicle to $141.69 by 2027/28. This could mean an additional 17 cents a week for a retired couple with one car, and up to $40 more a week for households with multiple vehicles.
Motorcycle levies are set to rise by 33 percent, though discounts will be offered to riders who complete safety courses. Owners of electric vehicles will lose their current subsidy, while low-powered mopeds will see a levy reduction.
Changes are also proposed for sports and artistic activities. Amateur and community sports groups not employing players may see levy decreases, while sports like rugby and football, known for higher injury risks, will face increased levies. Ballet dancers are another group likely to experience higher levies due to their high injury rates.