The Labour Party has been accused of loss-leading in its spending promises.
Accident insurers say Labour has under-priced the cost of its election promises by $1 billion.
Accident insurers say Labour's plans to nationalise accident insurance will be made up by the following contribution
from taxpayers:
1 reintroducing lump-sums - an additional $145 million
2 ACC cover for illness - an additional $572 million
3 reintroducing pay as you go - an additional $300m,
4 and in addition loss of set-up costs for private insurers of $100m
Insurers have repeatedly confirmed that safe work places for workers reduced accidents and better health care for
injured workers will be the key to succeeding not price.
The Insurance Council of New Zealand is surprised the Labour Party has failed to account for the cost of nationalising
accident insurance in its alternative budget released yesterday.
"We expected Labour to have worked the nearly $1 billion cost of restoring nationalised accident insurance into its
spending calculations", Chris Ryan, Chief Executive of the Insurance Council, said today.
"If Labour intends to nationalise accident insurance, which it has been saying it will do, it is very disturbing that
this hefty expense has been omitted from the alternative budget. Adding $1 billion to Labour's $4.35 billion spending
pledges will affect its ability to implement election proposals", Mr Ryan said
"If Labour has chosen not to factor the cost of nationalising accident insurance into its calculations, it must be
because it does not intend to do it, and that is a policy change all workers, employers and insurers should applaud", Mr
Ryan added.
"The introduction of the new accident insurance environment in July released $300m of employers' funds that would have
otherwise been committed to ACC payments under the old scheme", Mr Ryan said.
"In addition to the major long-term benefits of the employers' account - fewer work place accidents and better
rehabilitation for injured employees, reduced premiums for conscientious employers will result in the savings being
invested in the New Zealand economy", Mr Ryan said.
"Privatising accident insurance cover must surely rate as one of the largest investments in industry, particularly in
small and medium sized enterprises, that a government has ever made", Mr Ryan said.
"The size of this investment in the New Zealand economy has meant current and potential investors have watched the
development of the accident insurance environment very carefully", Mr Ryan said.
"We must continue to remind New Zealanders that the $100m cost of establishing private accident insurance in New Zealand
was largely covered by international investors", Mr Ryan
"There has been overwhelming support for the new accident insurance environment from policyholders, and that cannot be
ignored", Mr Ryan said.
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