Gordon Campbell on the life and ACC work of Sir Owen Woodhouse

With the death of Sir Owen Woodhouse, the founding father of the Accident Compensation Scheme, New Zealand has lost one of the titans of its post-war social policy. In its original incarnation in the early 1970s, ACC had been a globally innovative “no fault” scheme whereby accident victims surrendered their right to sue those responsible – on the understanding that they would receive compensation at a level that, as Woodhouse famously stated, would be sufficient to enable accident victims to fully participate in social life.

Unfortunately, the politicians who came in his wake have welshed on the state’s side of the bargain, lowered the payment levels, introduced destructive forms of competition and tightened the rules of eligibility – thereby turning a scheme that was meant to protect vulnerable people into an instrument for persecuting them. In recent years, the ACC has become a byword for ministerial and departmental incompetence, petty mindedness and spite towards claimants. Woodhouse lived long enough to see all of this happen – and in late 2009, when he was well into his nineties, Woodhouse was willing to publicly criticise the latest round of ACC changes as being “uncaring and predatory.”

Sir Owen, 93, says proposals to double and treble levies on motorcycles and mopeds, and to push accident victims back to work on much lower incomes than they earned before their accidents, breach the principles of the scheme he authored as head of a royal commission in 1967….He [also] opposed the Government proposal that accident victims should lose earnings-related compensation as soon as they were capable of going back to work in any job, regardless of what they did before their accidents. “I think it’s an uncaring and predatory attitude to people who are handicapped,” he said. “It’s pinch-paring and unnecessary. It’s all due to the fact that they regard it as an insurance scheme.”

To Woodhouse, ACC was an extension of the welfare system, and not primarily an insurance scheme. As the NZ Herald report pointed out in 2009:

The scheme, implemented in 1974, was the first comprehensive “no-fault” accident compensation scheme in the English common law world, ending centuries of costly legal battles to force employers to pay compensation for work injuries…Its five principles were community responsibility for causing and then supporting accident victims, comprehensive entitlement regardless of what caused the accident, complete rehabilitation, real compensation for the whole period of incapacity at 80% of previous earnings, and administrative efficiency. Sir Owen said he saw the scheme as part of the social welfare system – not as an “insurance” scheme where all future cost of this year’s accidents needed to be funded immediately.

As the NZ Herald pointed out, the alleged “blow-out” in ACC costs trumpeted by the government in 2009 as the rationale for raising the levies – which it has just lowered again, in election year – were actually the by-product of National’s own decision to introduce private sector competition for accident insurance in 1998. Again, Woodhouse had opposed that move, on both efficiency and fairness grounds:

He said competitive private insurance was appropriate for fire insurance, “but there are some things that the state does better, and one is education and another is the hospital system. If you have children you’d be concerned if you found that they estimate your child will be at school for so long, will or won’t go to university and will cost so much, and that that full cost has to be paid at the age of 5 when they start school. It’s the same thing with accident compensation.”

Perhaps fittingly, Woodhouse has died in the same week as ACC is being rocked by yet another scandal, this time concerning its abuse of its power to infringe on the privacy rights of claimants. The court system – which Woodhouse graced as one of our most eminent judges and president of the Court of Appeal in the 1980s – has just ruled against ACC, for the way it has routinely and unlawfully forced claimants to sign a sweeping and intrusive privacy waiver in order to lodge their entitlement claims. Furthermore, ACC Minister Judith Collins is being accused of knowing for some time about this instance of departmental abuse, while doing nothing to stop it.

During the war, Woodhouse had been seconded to the British Navy and was decorated for his bravery during his liaison work with Yugoslav partisans. His war work had called for people skills that were to come in handy in later life as well. On the bench and in his role as president of the Court of Appeal, Woodhouse was able to manage the talents and egos of such larger-than-life figures as Sir Robin Cooke with rare good humour, and sensitivity. Too bad that the visionary work of this extraordinary New Zealander should have fallen into the hands of political pygmies like Nick Smith and Judith Collins.