Five Million Voices

Should ACC have explicit legal authority to charge debit interest on levies paid by instalment, including retrospective validation of its past practice of charging?

The bill retrospectively validates ACC's past practice of charging debit interest on work-account levies paid by instalments and creates explicit legal authority for ACC to continue charging it, with a regulation-making power to set future interest rates.

⚡ Taken under urgency

Parliament advanced this bill under urgency (committee of whole house, first reading, second reading, third reading) — moving it through faster than usual, with less time than normal for public submissions.

MPs’ arguments for and against the bill

Why support it
  • Supporters said the bill confirms ACC's legal authority to charge debit interest and resolves uncertainty about its past and current practice, reducing the risk of litigation against the Crown.
  • Supporters argued that instalment plans are a useful option for small businesses and sole traders who might otherwise have to use more expensive forms of finance, and that charging interest reflects the administrative and opportunity cost to ACC.
  • Supporters said charging debit interest ensures that levy payers who pay in lump sums are not disadvantaged compared with those who pay by instalments.
Why oppose it
  • Opponents and critics questioned the retrospective element, saying the House should be cautious about passing laws that apply backwards and that retrospectivity runs against principles of good lawmaking.
  • Critics raised concern about the use of the regulation-making power, saying secondary legislation limits Parliament's ability to decide rates and could allow future increases above the current zero percent for three- and six-month plans.
  • Critics noted the bill was passed under urgency without a select committee process, which they said reduced the opportunity for public scrutiny and debate.

These are claims MPs made in Parliament’s debate — not verified facts.

Full bill summary & link to official bill page

The Accident Compensation (Interest on Instalment Plans) Amendment Bill amends the Accident Compensation Act 2001 to deal with interest ACC charges on levies. Businesses and self-employed people who pay their ACC levies can spread the cost over the year by paying in instalments instead of a single upfront sum, and ACC adds interest for that option. The bill gives ACC clear, explicit legal authority to charge this interest, and it retrospectively validates the interest ACC has already collected under its past instalment arrangements, confirming those earlier charges are lawful.

This is a Government bill introduced after it emerged that ACC's authority to charge instalment interest was not clearly set out in law. Supporters argue it simply confirms a long-standing, optional convenience that many levy payers choose, and avoids the disruption and cost of unwinding or refunding past charges. Critics object to validating charges retrospectively when the legal basis was unclear, arguing that fixing a shortfall after the fact raises rule-of-law and fairness concerns for those who paid.

See the Parliament.nz ↗ site for the full bill.

Oppose (No) Support (Yes)

Accident Compensation (Interest on Instalment Plans) Amendment Bill · Third Reading, 25 Jun 2024
Parliament voted 102–15 — it passed.