ACC warns Brooke van Velden: Your reforms will cost us more in payouts

Friday, 13 June 2025

Proposed changes to health and safety laws would likely see an increase in musculoskeletal injuries as well as slips, trips, and falls, warns ACC - meaning it would have to fork out more to pay for treatments. Explainer Editor Lloyd Burr takes a look.

Ministers are being warned that watering down workplace health and safety laws will likely cost ACC more because it’ll result in more injuries, and therefore more payouts to cover the cost of treatments.

It could also result in higher ACC levies for businesses, official documents show, despite one of the aims of the reforms being a reduction in compliance costs for them.

There are also concerns from some Pike River families that the current law - brought in following the 2010 coal mining disaster that killed 29 men - will be weakened so much, it could see more people killed in workplaces.

The changes to the Health and Safety at Work Act will be introduced later this year and will see employers and other organisations focussing on ‘critical risks’ rather than “addressing every possible risk” as they currently do.

That means the focus will be on risks with the “potential to cause death, serious injury, illness, or catastrophic failure” as outlined in a Cabinet paper by Workplace Relations and Safety Minister Brooke van Velden.

A Regulatory Impact Statement on the reforms makes a similar conclusion: “We are not addressing enough critical risks and are spending too much resources addressing lower-level risks”.

The first draft of the reforms hasn’t been released yet, but it’s expected before Parliament before the end of the year.

ACC’s concerns

ACC has raised a number of concerns about the reforms, and the impact it’ll have on its role as the state-owned provider of compensation for personal injuries caused at work.

“An increased focus on critical risks, to the detriment of more frequent but less severe injuries, could have an impact on AC Scheme costs,” feedback to ministers released under the Official Information Act reveals.

It points out that less severe injuries, or “lower-grade injuries” are responsible for more than 50% of ACC’s current work injury costs, which in 2024 was around $630m.

These are mainly musculoskeletal injuries like fractures, dislocations and high-grade tears as well as those resulting from slips, trips, and falls.

“Lower-grade injuries are also responsible for a large proportion of the productivity costs of injury borne by businesses. ACC sees that this proposed change could contradict the intention of the proposal [to reduce the burden on small businesses],” it says.

ACC has also raised concerns about what exactly constitutes things in the workplace that are deemed ‘low risk’ and ‘critical risk’ and which workplaces will be deemed ‘low risk businesses’.

“Minor risks result in reduced business productivity and higher costs for ACC,” it says as one of the key feedback themes.

Despite this potential impact on ACC, the organisation is not included in van Velden’s Cabinet paper’s list of government departments that were consulted. Nor was ACC listed as an affected group in the Regulatory Impact Statement.

Stuff asked ACC a number of questions about these concerns. They were forwarded to the organisation's OIA department which had not responded at the time of publication.

Minister responds

Stuff asked Minister Van Velden’s office a number of questions about ACC’s concerns, including what advice she’d received about a possible increase in the number of injuries due to her plans to “refocus” the law.

The questions also included whether she was concerned ACC would have to put up levies as a result, and therefore increase compliance costs for businesses.

Her office gave this response:

“The advice I received is that my changes will help to support the continued reduction in the incidence of serious workplace injuries and fatalities, therefore reducing the costs of these incidents for ACC.

“Critical risks are those that cause death, or serious injury or illness. I will be announcing further details in due course on how to define critical and low risk,” she says.

Pike River lessons at risk?

The 2010 Pike River coal mining disaster that saw 29 men killed in an underground explosion on the West Coast completely changed New Zealand’s health and safety framework.

Following the disaster - which the Royal Commission of Inquiry found was in part caused by a corporate culture of lax attitudes to safety and risk mitigation as well as the prioritisation of production - a new regulator was created (WorkSafe) and a new law introduced: the Health and Safety at Work Act 2015.

Anna Osborne lost her husband Milton in the disaster and has since become an advocate for workers’ rights and workplace safety. She’s worried the lessons from Pike, which are entrenched in the current law, will be eroded by van Velden’s reforms.

“Another Pike River will happen if these laws get watered down. I'm telling you that, seriously another Pike will happen. That’s sobering, isn’t it? But I hate the thought of others losing their lives at work.

“How many other people have to die at work in New Zealand before we actually get that we need tougher laws, not dumbed down laws? I just think it's really dangerous what she's doing,” she says.

Osborne adds that she and Sonya Rockhouse - who lost her son Ben and nearly her other son Dan in the disaster - want to meet with van Velden to raise their concerns.

“We've already asked to meet her and at this stage we haven't heard back. I reckon she needs to accept our request so we can actually sit down and discuss all of this,” Osborne says.