What we are seeking to achieve over the next 3-5 years and why it's important

New Zealand has a world-leading approach to compensating and rehabilitating people who have been injured in work or in their daily activities. The Department is responsible for advising on the effective design and operation of this accident compensation scheme.

The accident compensation scheme provides comprehensive 24-hour, no-fault cover and entitlements for all New Zealanders, residents and temporary visitors to New Zealand. The scheme aims to prevent injuries and, where injuries occur, restore people's health and independence to the maximum extent practicable and provide compensation for injury losses.

The accident compensation scheme impacts on businesses and the community through its focus on the prevention of injuries and provision of financial support when injuries do occur. The accident compensation scheme contributes to New Zealand's economic growth by ensuring people return to work, thus reducing the economic costs to employers and the government and by supporting people until they can return to work.

The current settings of the scheme and its management mean that the scheme itself is not stable. In recent years claims and liabilities have increased rapidly (from $9 billion to $23 billion between 2005 and 2010) which has resulted in higher costs for taxpayers and levy payers. Significant reassessment of the scheme is needed to mitigate further increases in costs for families, businesses and the government to ensure that the scheme remains affordable.