When ACC became a welfare agency

A column from the Dominion Post by Karl Du Fresne

Much has been said about the blowout in ACC spending that resulted when the Labour government extended coverage to include medical misadventure and free physiotherapy.
But anyone seeking to identify the point when ACC strayed from being an insurer to a welfare agency should go back to the 1980s, when it began subsidising the sexual-abuse counselling industry.
In 1988, ACC accepted 221 claims for sexual abuse or, more precisely, mental illness arising from alleged abuse at a cost of $1.9 million. By 2004, claims were running at an average of 5000 a year and annual costs had risen to more than $27 million.
One claimant got more than $150,000 in backdated compensation and several were being paid more than $60,000 a year in weekly compensation payments based on their earnings before their "injury" was diagnosed.
No doubt many claims were legitimate but 5000 a year? And was compensation for alleged sexual abuse ever envisaged by the architects of the scheme?
No corroboration of the alleged abuse was required, other than a supporting statement from an ACC-registered counsellor. There was no requirement that the supposed victim lay a complaint with the police, still less obtain a conviction. The alleged abuser didn't even have to be identified.
In many cases the alleged abuse was far in the past, raising suspicions about "recovered memory" syndrome.
This was a tidy little racket that benefited both the claimants and the burgeoning counselling industry, which pocketed generous fees from ACC for two-hour assessment sessions which invariably resulted in the counsellor confirming that sexual abuse had taken place. Acceptance of a claim usually led to further counselling sessions, thus ensuring a steady income stream for the therapists.
"Counselling" was a rubber-stamp process similar to the charade women go through when seeking a state-funded abortion.
The Bolger government curbed the worst excesses of the scheme in 1992 by stopping lump-sum payouts, but otherwise the rort continued. I remember questioning the then ACC minister, Bill Birch, about the potential for bogus claims and being fobbed off with bland non-replies.
One of the few politicians with the guts to speak out was ACT MP Heather Roy, who in 2004 compared sexual-abuse payouts with Lotto prizes. By then Labour had reinstated lump-sum compensation, which predictably led to a quadrupling of costs.
At the same time ACC funded a $600,000 study of the mental effects of sexual abuse a nice gravy train for Labour-voting academics and spent $200,000 bailing out an Auckland counselling service that was about to fall over. Whoever said New Zealand governments had given up subsidising industries?
Interestingly enough, an Auckland survey of women being counselled for sexual abuse found that 30 per cent had undergone 100 or more ACC-funded sessions of therapy. Despite that, many expressed disappointment that they were not getting enough.
This confirms that in a grievance-obsessed culture, there can never be enough nannying.

© 2010 Fairfax New Zealand Limited
http://www.stuff.co.nz/blogs/opinion/columnists/2269246/When-ACC-became-a-welfare-agency