The residual portion of the Work Account levy cover the ongoing cost of work injuries that happened before 1 July 1999 and non-work injuries that happened before 1 July 1992, for which ACC still provides treatment, rehabilitation and compensation benefits.
Types of residual portions of levies
There are two types of residual portions of levies:
- The residual portion of the Work Account levy – covers the ongoing costs of work injuries that happened before 1July1999 and non-work injuries suffered by workers before 1July1992
- The residual portion of the Earners’ levy – covers the ongoing costs of non-work injuries to workers that happened between 1July1992 and 30June1999.
Why do I have to pay for old injuries?
Before 1992, self-employed people paid a single levy to cover their work and non-work injuries. Employers also paid a single levy to cover their employees’ work and non-work injuries. Recognising this was unfair for employers, ACC set up the Earners’ Account in 1992. The Earners’ Account covered the costs of employees’ non-work injuries.
In 1999, the Government changed how the ACC Scheme was funded.
- Before 1999, ACC levies were 'pay-as-you-go' – they only covered the claim costs for the year in which they occurred.
- After 1999, ACC levies had to cover the full lifetime costs of injuries that occurred in that year (serious injuries often have costs that extend for many years).
In summary, the residual portions of levies are required to pay for the ongoing costs of claims that occurred before 1999, when not enough was collected to cover the full cost of the claims.
Last updated: 23June2010