19 Jan 2010

ACC culls high-cost claimants

6:27 am on 19 January 2010

A new ACC unit targeting high-cost clients has culled more than 700 long-term claimants in the last six months.

The recover independence unit, which was set up in July, is part of an attempt by ACC to cut costs by $1 billion over the next three years to make up for a shortfall in levies paid by employees.

In a normal year, about 700 long-term clients would leave the compensation scheme but that rate has doubled under the new regime.

Critics say many accident victims are losing their entitlements for spurious reasons.

Compensation law specialist John Miller says many claimants have successfully challenged ACC's decision to cut their entitlements - but some were without income for six months and had to sell their homes.

Mr Miller says ACC's drive to cut long-term claimants is a false economy. Most will end up on relying on welfare, he says.

But ACC Minister Nick Smith says he supports the drive, which aims to save $900 million by 2013.

Dr Smith says the Government makes no apologies for the increased focus on just entitlements at a time when ACC faces a massive cost blowout.

He says people who are unable to work as a result of their injuries should get fair compensation. But levy payers should not be expected to support those who are able to work, or who would be more appropriately given an invalids' benefit.