Abuse compensation claims has cost ACC $50 million so far

RNZ News

3 days ago

ACC estimates 262 people have been accepted for Loss of Potential Earnings payments, but initially estimated it would affect around 100,000.
Photo:
Supplied
A Court of Appeal ruling that's blown a multi-billion dollar hole in ACC's books has so far cost it $50 million.
The
TN vs ACC
ruling in 2023 allowed more childhood
sexual abuse survivors to receive financial compensation
from the corporation.
ACC estimated the ruling, plus another Court of Appeal decision
expanding cover of the scheme
, could cost it more than $3.6 billion in outstanding claims liabilities. This contributed to
ACC's $7.2bn deficit
last year.
Between July 2023 and April this year, ACC estimated 262 people had been accepted for Loss of Potential Earnings (LOPE) payments as a result of the TN vs ACC decision, at a cost of $50 million, according to newly released figures under the Official Information Act.
TN's lawyer Beatrix Woodhouse said many survivors might not know they were eligible for financial compensation.
"ACC initially estimated it would affect around 100,000 so 262 does seem very small.
"There's not much visibility in terms of the new law, and I imagine that a lot of climates don't actually know that they are now eligible or can apply. In my experience, I'm making my clients aware of the change in law," Woodhouse said.
Previously, childhood abuse survivors were only entitled to LOPE if they sought treatment for a mental injury arising from sexual abuse before they were 18 years old.
The appeal court ruling changed this to the date on which the mental injury first occurred.
In the case of TN, the claimant was abused from the age of two and prevented from seeking help by her family.
Her family prevented the woman, who has name suppression, from seeing a doctor unaccompanied. This meant she could not tell anyone about the abuse before she was 18.
When she eventually did seek help decades later, her father and uncle were convicted and sent to prison, but her first ACC claim for LOPE was rejected despite being so severely affected by the abuse she was unable to work as an adult.
ACC deputy chief executive service delivery Michael Frampton.
Photo:
Supplied
ACC said it was still working through the details of
how it would "fully operationalise" the TN ruling
.
"When it was announced, we reached out to relevant professional bodies so they could let their members know and providers could advise their clients of this ruling," ACC deputy chief executive service delivery Michael Frampton said in a statement.
"We've provided interim guidelines to staff handling requests for weekly compensation or Loss of Potential Earnings for sensitive claims. Our recovery partners have been responding to requests from existing sensitive claims clients and discussing financial entitlements with new clients who request them," Frampton said.
ACC said the 262 claims were only an indicative figure because it did not have a specific way of knowing a claim receiving LOPE was a result from the TN case.
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