Submission from the National Committee of The Ulysses Club of New Zealand Inc.
Submitted by
Howard Mansell, National Secretary
This is the official and agreed submission by the National Committee of The Ulysses Club of New Zealand Incorporated. This Committee comprises seven elected members representing approximately 3,200 members nationwide. Our Club is a social club for people over 40 years with an interest in motorcycling.
We make this submission after considering arguments and debates on both sides and especially after listening to our members’ expressed concerns.
Our submission comes in seven parts, some of a philosophical nature and some specifically relating to motorcycling issues. We believe that although our submission has been sparked by the proposed increase in levies, this proposal has opened a much wider debate and our submission reflects that.
1. The Design of ACC (Model)
The entity called ACC was established after extensive and robust public debate via the Royal Commission process headed by Sir Owen Woodhouse, started in 1967 and finally established in 1974, seven years of debate. As such the citizens of New Zealand are partners to an agreement between themselves and the Government as to the form and shape (model) of ACC. We accepted the loss of the right to sue on the basis of the agreed model of ACC being maintained. Government does not have the mandate to change this. The increase in ACC levies for motorcyclists had been brought about because of the desire to make ACC a fully funded system. It will be at the Government’s peril that it makes policy changes that move ACC’s model dramatically away from that originally agreed. We ask that all proposed changes be put on hold and that a Royal Commission or other robust public forum be set up to consider the change in the model of ACC.
2. Incremental Drift
Over the years there has been an incremental drift in ACC away from the original model. This is a natural and positive process but we as a community have obviously reached a point where the entire system has moved so far away from its original design that it is almost unrecognisable and by its own admission has become unable to continue to operate effectively. We suggest that it is now time to reassess the processes and policies of ACC using the originally agreed model as a reference; or to, by way of a new Royal Commission or other such robust public forum, come to a new agreement establishing an acceptable modernised model between the Government and the citizens that suits the needs of today’s society. This must include a full reassessment of the benefits paid by ACC. We believe that this is the better way to attack the stated monetary shortfall (if there truly is one that hasn’t resulted from a change in policy, which we doubt). New Zealanders must be asked what they want ACC to provide, if we as a Nation can’t afford that then we have to accept a reduction in benefits or an increase in levies, but only when that new agreement is established can major changes be made that are acceptable to all parties.
3. Factionalising
Attempts by senior politicians and officials of ACC to factionalise the general driving public away from the road registered motorcycling section of society has cast doubt on their integrity and competence to lead debates on these policy changes. The $77.00 per car owner (approximately $200,000,000) being required to prop up the $62,000,000 “deficit” between motorcyclist’s contributions and costs statement is an example, primary school maths easily shows these statements as contradictory and serious doubts have now also been cast about all figures and statistics touted in recent statements. Independent auditing is now required, of the presented figures and statistics and the methodology of acquiring the statistics, and the analysis of them, that has resulted in the proposed changes. The Government and ACC must show transparency and integrity on these matters before changes of the magnitude proposed can ever be acceptable.
It should not need to be pointed out that motorcyclists are also almost universally motorists as well, we are also citizens, not an singular group which can be targeted in isolation. There is plenty of evidence that the attempts to turn motorists against motorcyclists has failed miserably and that we have a great deal of support from the general population. The increasing level of protests not just by motorcyclists but by members of other groups of the community are an indication that the general populous do not trust and do not agree with ACC’s figures, nor with the direction that ACC appear to be heading.
4. Multiple vehicles
This is something that now needs to be examined for all private vehicle registrations. The ACC component of motor vehicle registrations is in essence a payment for an agreed indemnity against losses resulting from an accident whilst using that vehicle which on the face of it appears fair enough. The problem with that is that perhaps unlike the times in 1974 when the policy was set up many people now have a number of different vehicles which allow them to indulge in different activities. People can only indulge in one activity at a time so we are effectively paying many times over for a single indemnity. In the original model the ACC component of registrations was a small, nominal amount not a targeted fully funding tax. We believe that it is time to consider whether this is a fair way to acquire funding for this cover. If this situation is accepted as unfair then there may potentially be a legitimate case for our registration fee ACC levies to go down, not up!
The ACC statement that a person having more than one motorcycle will loan or lend the spare to friends is another clear example of the lack of consultation that ACC has initiated with motorcyclists before putting this proposal. The number of people willing to share their bike with others is miniscule. Today’s bikes are very fragile and extremely expensive to repair if dropped. The cost of insuring motorcycles will substantiate that. Motorcycles are also seen as an extension of a person’s character and personality, something that non-motorcyclists will have trouble grasping; generally we don’t see our machines as utility transport. It takes a great deal of trust for a person to allow others to ride one’s bike and it almost never happens.
5. Targeted or Community Funding (No Fault policy)
What we believe the population really want is indemnity against losses resulting from any accident that should happen to them from any activity that they are indulging in. Is it fair that one group of society be targeted and expected to pay huge sums of money towards the expected costs of caring for their treatment because they are easy to target? Many identifiable groups of the community indulge in activities which are inherently more dangerous and are more likely to result in injury than others. Examples are road cyclists, mountaineers, many team sports such as rugby and netball, boaties and divers, horse riders, we suggest that a new approach (or is it the old approach?) be considered that accepts this situation as an inherent part of a healthy community and something that the community as a whole must accept and ultimately pay for. Targeting these groups will only act as a disincentive for people to walk away from the couch and the TV and this will adversely affect our society as a whole. As well many of our community are inherently more at risk to injury, the very young and the very old have a higher likelihood of injuring themselves, should we massively tax these groups based on their higher risk?
It is a community issue and should be addressed in a fair and equitable way.
Also, if it is decided to make judgements on the degree of risk or “fault” that a person has in an accident that has resulted in their injury there must also be a method of judging the level of fault, is the fault shared in that accident, for example was the accident the fault of the car driver 55% and bike rider30%, city council 15% because of road conditions or poor signage, very cumbersome and expensive to process. Then there will need to be the process of looking at what the person has done to negate the risks and as well looking at this person’s history of hurting themselves, in insurance terms, a no claims bonus. Has the person proven themselves to be willing to accept training on how better and more safely to indulge in the activity? Have they proven themselves capable and competent by having no accidents in the last 20 years whilst indulging in this activity? These aspects must be considered, it is patently unfair to only consider the fault aspect without including the fault sharing and negating aspects. This then becomes clumsy and difficult and will result in huge administrative difficulties and costs to all parties.
We suggest that the original design of the no fault system is vastly better.
We also ask that clear, accurate and verified data be made available that shows the levies paid to ACC, and the cost resulting from injury for the last five years, for: motorcyclists ( broken down by road registered and non road registered, racing, off road groups) and also many of the other high risk activities such as rugby, league, skiing, cycling, mountaineering, horse riding. This information will either support or dispel the perceived notion among motorcyclists that they are being unfairly targeted.
6. Fees structure based on CC rating
ACC claim to have statistics to prove that injuries in accidents happening on higher CC rating machines are more severe and cost more to treat. We have already talked of our mistrust of ACC’s statistics so that is a given. Looking at this logically we have to question the concept from a ratio point of view. We are told that 60 to 80% of multi-vehicle crashes involving a motorcycle are accepted as not being the motorcyclists fault. If for this discussion we accept that 20 to 40% of all motorcycle accidents are due solely to rider error a large number of those accidents must involve learner riders on small capacity machines (legally a maximum of 250cc), (learner and novice riders are inherently less likely to have a good perception of dangers than experienced riders).
Also, there are a large number of midsized capacity machines registered so that leaves a small percentage of the whole of motorcycling accidents being the riders fault on a large capacity machine. We have to ask “what is the true ratio of costs relating to rider at fault, large capacity bikes against smaller capacity bikes?” Is it really as significant as ACC are saying?
Choosing any arbitrary size ie: 600 cc’s makes absolutely no sense to people in the motorcycling community because we know that a modern sub 600cc machine is easily as capable of travelling far in excess of the speed limits and being involved in a serious accident as a larger capacity machine. By the same token an older large capacity machine with a much higher weigh to power ratio is capable of much less speed and performance than some modern 250 cc “learner” bikes.
If you get hit by a car it makes absolutely no difference whether you are on a 50cc scooter or an 1800cc Goldwing. It really comes down to the rider and the level of skill, training and hazard awareness that the person has. The CC rating has no more relevance on bikes than it does in other motor vehicles and we note ACC are not suggesting a CC rating differential in any other type of vehicle.
We simply do not believe that there exist any accurate statistics that prove ACC’s statement that crashes on higher CC rating machines result in significantly higher cost treatments relative to lower capacity machines. In fact, looking at it logically because of the higher level of experience and generally the age of the riders of larger capacity machines, the higher visibility, better braking systems and better lighting systems on larger machines we believe that the opposite may well be true.
7. Rider and Driver Training
ACC sees accidents happening that involve motorcycles as a motorcycling problem but at the same time accepts that in most cases there is a car or other vehicle involved and in most of those cases it is the other drivers fault, not the motorcyclist. Would it not be more rational and sensible to be working pro-actively trying to change the level of skill and driving habits of all licence holders thereby increasing safety on the roads for all, than an “Ambulance at the foot of the cliff” approach of punishing a select group for getting injured by our generally lowly skilled and poorly trained driving licence-holders? Acquiring a driver’s licence in New Zealand is a vastly simpler challenge than in many other countries in the world, for example Switzerland and Japan. This results in our average driver having at best a poor average driving skill and not really valuing their licences once they have them. A higher training and skills threshold for achieving a licence would result in a greater level of skill, and a higher value being placed on having a licence to drive/ ride. If this was backed up by a higher level of enforcement this would result in getting the many unlicensed drivers off the road. This shift in policy would result in a large decrease in accidents overall and would negate the need for massive increases in levies to be paid by the victims such as is being proposed at present.
Summary: We submit
• that the present processes and future direction of ACC be investigated using a robust and transparent independent process such as a Royal Commission which asks the citizens who are partners in this agreement what they actually want and finds a way to fund it in a practical way.
• that all presently proposed changes making ACC fully funded be held back until the results of the above investigation has produced its findings.
• that proposals removing the “No Fault “ policy be reconsidered and preferably scrapped.
• that proposals relating to a levies structure based on engine capacity (CC rating) be scrapped.
• that better driver training and better policing of unlicensed drivers is a more logical way to approach the problem of excessive road accident costs/ receipts imbalance to ACC.
ACC's answer
Te Kaporeihana Awhina Hunga Whara
Corporate Office
Shamrock House
81-83 Molesworth Street
P0 Box 242, Wellington
New Zealand
Ph o4~918 7700
facsimile 04-9187701
1 6 March 2010
Howard Mansell
National Secretary
The Ulysses Club of New Zealand Inc
Dear Mr. Mansell
Thank you for your submission on the 2010/11 proposed levy rates for the Motor Vehicle
Account. You will have already received a letter from ACC that outlined the general
concerns raised in the submissions to ACC and the final levies agreed by Government.
This letter responds to the points raised your submission.
The Design of ACC (Model) and Incremental Drift
The design of the ACC scheme is the mandate of the Minister for ACC and the Government, As such the comments in this area of your submission cannot be considered by the ACC Board while they are developing their recommendations on funding and levy requirements.
Advising the Government on changes to the design of the ACC model is the responsibility of the Department of Labour. Your submission has been forwarded to the Department for consideration as part of the Stocktake of the ACC Accounts which is scheduled to report
Factionalizing
Unfortunately the figures used in the community discourse during the levy consultation process (and in subsequent letters to the Minister and ACC) on motorcycle levies mixed cash and lifetime cost data.
The expected lifetime costs for injuries sustained by motorcyclists in 20 1 0/1 1 are in excess of $256 million (in today’s dollars). The levies announced by the Government will see ACC collect approximately $58 million (23% of lifetime costs) from owners of motorcycles. Owners of other vehicles will fund the rest of the costs associated with the injuries that are sustained by motorcyclists.
The estimated future costs of claims have been developed by actuaries and reviewed by two independent actuarial organisations and have been found to be fair. The documentation provided to the public by ACC has made these figures clear and presented the methodology used to determine them.
Multiple Vehicles
The argument presented in your submission (and many others) does not take into account the situation where a single person registers multiple vehicles but the vehicles are operated by other individuals. This situation was highlighted by Peter McIntosh, National President of the Ulysses Club, at a meeting with ACC during the levy consultation period. To overcome this ACC could apply levies to motorcycle licence holders. However this would raise the situation where people who want to continue to hold a motorcycle licence but do not own or use a motorcycle would have to pay a levy. This would be unfair. While other systems of collecting levies from riders have been suggested, none are convincingly more equitable or cost-effective than the current situation.
Your submission states that motorcyclists are reluctant to share their bikes, This may not be correct for other forms of vehicles which must also be considered by ACC when looking to change pricing or collection approaches.
The current collection mechanism places some limitations on ACC’s ability to create options for levy payers such as multiple vehicle levies. ACC will explore the idea of a multiple vehicle levy with our collection agent (NZTA) to determine its feasibility.
Targeted or Community Funded (No Fault Policy)
The proposed levies from ACC and the levies agreed by Government are based on a non-fault policy. The differential levies are a mechanism to provide a fair allocation of where the funding for the costs of the Account should come from and provide appropriate pricing signals for injury prevention activities.
Fundamental premise for this approach is based on the observation that travel in different types of vehicle present different injury cost consequences for the scheme (and therefore its levy payers). Applying the principles of fairness and equity to this situation suggests that the funding for the injuries should be drawn at different rates from the classes of vehicles.
The relativities used by ACC are the outworking of the application of fairness and equity principles when looking at the entire levy payer group.
Fee structure based on cc rating
ACC has provided its analysis in the technical document during the consultation. The document is attached to this response. Your submission neglects the single vehicle crashes which account for 26% of reported motorcycle crashes. The funding collected from the Government agreed levy equates to 23% of the total funding required to cover the costs of motorcyclists injures.
The argument made on behalf of larger motorcycles has not considered the fact that the cost of income replacement associated with these riders/pillions is often much higher than that associated with injuries on smaller bikes or mopeds.
Rider and Driver Training
ACC views injuries that occur to motorcyclists as an issue that affects all vehicle owners as all contribute to the cost of the injuries and in many cases other vehicles are part or all of the reason the injury occurred. The Government has signalled that it is concerned with the amount of investment made by ACC and other road safety agencies towards motorcycle safety by establishing a Motorcycle Safety Levy. It is hoped the additional funding ~~~ill improve the safety of motorcyclists on New Zealand’s roads and led to reductions in the levies paid by owners of motorcycles.
Thank you again for the submission from Ulysses. If you have any more questions or require further information please contact Paul Gimblett directly on (snip)
Yours sincerely
Keith McLea
General Manager
Product, Pricing and Distribution
Reply With Quote
Originally Posted by Okey Dokey
and now I'm a furthur hundred bucks out of pocket. Fuckers.
I didn't think!!! I experimented!!!
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