'Pay as you go' ACC model short sighted – Banks

An article from the National Business Review by Caleb Allison

ACT leader John Banks says pay-as-you-go for ACC may save money now but future generations will have to pick up the tab.
ACC is now a fully funded model whereby the corporation builds up enough cash reserves to cover existing and potential future claims.
Labour is advocating a return to pay as you go, which means ACC only needs enough income to cover a year's worth of claims, plus a little extra for unexpected costs.
The plan would see levies go down by 20% to 25%, Labour says.
However, Mr Banks says claiming the pay as you go model would reduce levies is a false economy.
"The costs remain the same, but its tomorrow's levy payers that are forced to pick up the tab," he says.
The model does not adequately factor in the risk that some people's injuries require lifetime support from ACC, meaning the costs are transferred to future generations of levy payers, Mr Banks says.
"The best strategy is to open up ACC to real competition so customers can punish bad service by voting with their feet."
National is not ruling out abandoning the fully funded model, with ACC Minister Judith Collins saying "no decisions have been made".

Copyright 2012 National Business Review

http://www.nbr.co.nz/article/pay-you-go-acc-model-short-sighted-banks-ca-121576

Has Key avoided a Darren Hughes moment?

An article from the National Business Review by Bryce Edwards

This afternoon Nick Smith told Parliament that he resigned all of his ministerial portfolios this morning following two errors of judgement regarding Bronwyn Pullar’s ACC case.
In delaying Smith’s resignation, did John Key risk making the same mistake with Nick Smith that Phil Goff made with Darren Hughes? Only this morning, Adam Bennett reported that Key was backing Smith, although the Prime Minister had said ‘that may change’ – see: Key backing Nick Smith – for now.
Pressure was rapidly mounting on Smith over his reference for his friend Bronwyn Pullar and Tracy Watkins argued that Key’s continued backing of Smith would come back to haunt him, particularly as there is the possibility of further revelations – see: Nick Smith's letter a step too far.
The issue had taken on all the ingredients of a classic political scandal which, as Vernon Small reports, Winston Peters was taking full advantage of. In parliament yesterday Peters described it as ‘a shabby little case, involving blackmail, sex, a minister with a conflict of interest’ – see: Calls for Nick Smith's head over ACC. That prompted media to further question Smith on the exact nature of his relationship with Bronwyn Pullar, which he has so far refused to elaborate on.
Smith’s mistakes are bad enough, but the involvement of Pullar – a former National party official – and high-profile ex-party president Michelle Boag, add to the perception that the National Party is involved in cronyism or even corruption. This is the word that John Armstrong uses when he suggests that Smith should have at least offered to resign yesterday – see: Nats left wide open on ACC fiasco.
The chorus calling for Smith to resign, or at least be stood down pending an investigation, extended beyond the usual suspects on the Opposition benches. The Herald editorial (see: Apology not enough for Smith's folly) points out that a minister was suspended during the first term for charging two bottles of wine to a ministerial credit card.
Duncan Garner argues the 20-year veteran minister should have known better and advised Key to Sack Smith Now. Right-wing blogger Cathy Odgers knows Pullar personally and has a very sympathetic analysis of the situation but is nevertheless adamant that Smith had to go. She said that with Winston Peters having so much ammunition ‘something has to give’ – see: Another Reason To Privatise ACC.
The task of defending Smith and Key seems to fall solely on David Farrar (see: The ACC saga), who also praised David Shearer for not immediately demanding Smith’s resignation. Patrick Gower, however, has a different take, saying that Shearer mistakenly allowed other Opposition spokespeople, including other Labour MPs, to make the running in the twelve hours after the Herald broke the story. Gower argues that, despite Shearer trying to cultivate an anti-politician image, sometimes being Opposition leader ‘means putting a bullet in the gun. And firing it. Or someone else – one of the other Opposition leaders – will do the job’ – see: Shearer's shocker on Nick Smith scandal.
Scandals like this not only impact on those directly involved, but can tarnish a party’s image and, as Phil Goff found last year, dent a leader’s credibility if they are seen as indecisive and only responding to political fallout, rather than doing the right thing in the first place.

Copyright 2012 National Business Review

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'Sex' didn't mean what you think it meant, says Peters

An article from the National Business Review by Rob Hosking

New Zealand First leader Winston Peters is backing away from any suggestion of an improper relationship involving National minister Nick Smith and party official Bronwyn Pullar. He did not mean what everyone seems to have assumed he meant, Mr Peters told NBR Online.
The row, which blew up when Ms Pullar was accidentally sent a spreadsheet containing sensitive ACC claims data, and when it subsequently emerged that Dr Smith had written a letter support Ms Pullar against the corporation, was the subject of an urgent debate in Parliament yesterday. Mr Peters described the affair as "a shabby little case involving blackmail, sex, a minister with a conflict of interest" during that debate.
Dr Smith has subsequently declined all comment on the issue, saying only "I'm just not commenting on my private life."
Yet Mr Peters now says he was not suggesting, for even a second, anything about Dr Smith's private life. The "sex" reference was only to the fact that some of the information accidentally leaked to Ms Pullar was about people who were claiming accident compensation for sexual assault, he says. The confusion arose, Mr Peters insisted this morning, because he had omitted a paragraph in his prepared speech because he was running out of time.
"I'm glad I kept this," he says about the notes he prepared for the speech, which he happened to have on him when contacted on his cellphone by NBR Online. He was to have said, about the private information, that "this included data which identified some as making sensitive claims for injuries resulting from rape or other forms of sexual assault.
"So there it is: a scandal from a government which holds itself as cleaner than the driven snow, a shabby little case involving blackmail, sex, a minister with a conflict of interest. He should go now. "
He was not trying to suggest any improper relationship between Dr Smith and Ms Pullar at all, he says, but, "unfortunately, in the time I had available, I don't think I got to deal with the third to last paragraph of my speech."
The issue of Dr Smith and Ms Pullar is to feature further in question time at Parliament later today.

Copyright NBR 2012

http://www.nbr.co.nz/article/sex-didnt-mean-what-you-think-it-meant-says-peters-rh-p-113755

ACC leaks: your questions answered

An article from the National Business Review by Rob Hosking

What the hell is going on at ACC?
Leaks, apparently. More leaks than a nervous, incontinent Welsh chef.
So if I’ve got this right: someone was sent a lot of personal accident claim data, some of it from the sensitive claims unit at ACC. And she threatened to go public with it unless she got some sort of guaranteed cover for the next couple of years?
Well, that’s what’s being alleged. The first bit is fairly clear: ACC accidentally sent the woman, who has been ‘on claim’ for nearly a decade, a spreadsheet containing information about around 6700 other people, including a number in the “sensitive claims” –that is, rape and sexual abuse – area. There’s a few odd aspects to all this though.
You mean that in itself isn’t odd?
Not as odd as it should be. A number of people – mostly medical people and lawyers – are now making it known they get sensitive material accidentally mailed to them by ACC on a not-infrequent basis.
How come we haven’t heard about that?
There's a sinister possibility - and more on that below - but probably the main reason is because on the whole they just email the stuff back, perhaps with a terse note suggesting ACC staffers be a bit more careful in future.
Which sounds like a fairly obvious thing to do.
Obvious, straightforward, and above board. For whatever reason, that didn’t happen in this case, which is the first thing about it which smells. The stuff was mailed to the woman – Bronwyn Pullar – last August, and it has only come to light recently.
Why?
Well, it’s pretty hard to avoid the conclusion that someone is trying to use it for its embarrassment-value.
Has it worked?
ACC’s looking pretty red faced. Chief executive Ralph Stewart effectively delivered a public reprimand to the manager concerned. Stewart himself doesn’t have to worry about embarrassment – he was still working at Axa when the events in question took place, and only came on as CEO late last year.
Are heads going to roll?
Stewart says not, at this point anyway. The worrying thing about the other emails which have been published is that Pullar is saying she has enough dirt on “corruption” at ACC and the tone suggests she is going to blow the whistle and embarrass the government. The message to then- minister Nick Smith is pretty clearly in that direction. ACC itself say Pullar tried to use the embarrassing leak of the private files of 6700 other claimants to get ACC to pay her a two-year guaranteed benefit.
Couldn't that be interpreted as blackmail?
Well, it could be, yes. Pullar denies she ever made such a threat.
Doesn’t that make the ACC’s accusation defamatory?
Uh huh. That would be Pullar’s next move, if  the accusation isn’t true.  The other thing she may do is follow up her threats to expose what she calls ACC's 'rotten to the core' culture.
What did she mean by that?
Not clear at this point, but here's the thing:  if other people have used such embarrassing leaks to get what is effectively 'hush money' out of ACC, this could blow up very big.
Is there any evidence of that?
None, not at the moment any way.  The thing is, if Pullar did try to use that as leverage for more money, she is also doing what she accusing ACC of doing.
What, bullying?
Heh. No, or not just that anyway.  One of her complaints - and it is one you hear a lot about ACC - is that it all too often tries to over-ride medical advice with its own interpretation of someone's medical conditions. The golden rule of insurance in these areas, whether it it is public or private, is that the medical diagnosis, prognosis, and treatment is the job of the medical specialists involved, not the insurer or anyone else. ACC has for a long time - going back well before the change of government, by the way - had a reputation for constantly pushing through that boundary.  I've heard a number of GPs say ACC is worse than a lot of private insurers in this regard, going back a decade or more.  But the funny thing is that if Pullar did what ACC say she did - and I stress at the moment it is ACC's word against hers - then she did that herself, by demanding a fairly specific payout regardless of any medical advice about her condition.
What is Michelle Boag’s role in all this?
She’s a National Party chum of Bronwyn Pullar’s, apparently. Just a mate. Nothing political going on here at all. Perish the thought.
Really? Michelle Boag is involved, and there’s nothing political going on?
Apparently. Well, it could happen.
It’s a bit of a stretch though, isn’t it?
Well ... you ever seen the photo of the world’s largest rubber band? Something a bit like that. The story is they are both old National Party mates but Boag says she hasn’t been 'involved' in the party for nearly a decade. She was president back then, but hasn’t held an official position since.
So there’s no National Party connection now?
She says, not. She was quoted as saying she’d had no involvement with National for a decade. Apparently she finished as party president and then severed all ties. Didn’t use those contacts she’d built up in that time at all.
You’re not serious?
No, I’m not serious. Apparently Boag is, though.

Copyright 2012 National Business Review

http://www.nbr.co.nz/article/acc-leaks-your-questions-answered-subbed-rh-p-113495

Leak recipient tried to blackmail ACC

An article from the National Business Review

A woman mistakenly emailed the personal details of 6752 ACC clients tried to blackmail senior managers, the agency says.
An ACC "Situation Report", made public today, says the woman was mistakenly sent an email, with sensitive claimant detail in an attached file, on August 5.
ACC first learned of the privacy breach on December 1, when two senior managers met with the woman on December 1. At the meeting, "the client proposed that in relation to her own individual case, she would like to negotiate a guaranteed benefit payment for two years," according to the situation report.
"She made threats that if her demands were not met she would not return the information and she would inform the media of the alleged privacy issue."
It appears that, earlier this week, the client did just that, with the first article on the affair appearing on Tuesday this week.
The Situation Report was written for ACC Minister Judith Collins, who has demanded answers from the agency over how the breach occurred. ACC has also laid a complaint with police.
The two senior managers did not take the woman's threat to higher management. The woman erroneously claimed the email was sent to her by one of the two senior managers she met with. In fact, it was sent by a more junior staff member, whose account was not included in an email sweep that followed the December meeting.
The report released today did have one positive for ACC. It said no personal claim details or personal claim history in the file - although it did include a person's name, the category of their claim  and whether it was accepted or not.

RAW DATA: The Situation Report (PDF)

Copyright 2012 National Business Review

http://www.nbr.co.nz/article/leak-recipient-tried-blackmail-acc-ck-113288