Finance Minister Bill English says ACC levies could drop more than first thought and pay rates will increase:
The Government is planning to reduce ACC levies by as much as $2 billion over the next two-three years, Finance Minister Bill English said today.
Speaking to Corin Dann on TV ONE’s Q+A, Mr English said that ACC has “by combination of things, including just doing a better job of rehabilitating people sooner” given the Government the opportunity to reduce levies substantially – “the equivalent of a four cent cut in the company tax rate.”
Mr English also told Corin that in the same two-three year time-frame, New Zealanders can look forward to higher pay increases.
““The good news for the punter is that business confidence is at the highest it’s been at for many years. That indicates that in their workplaces, there’s growing confidence that they can sell more, that profits are going to be up, that pay rises are coming.
“There are some things that will force them to do it. One is just their need to get hold of skilled people. We’ve already got skill shortages in some areas. As employment— As new jobs grow, you’re going to see more of that,” Mr English says.
ACC levies and pay rates are related. Lower levies leaves more money with businesses which makes them better able to afford wage increases but the positive outlook is based on much more than that.
The economy is growing and businesses are doing better.
They will have several priorities for increased earnings including reducing debt and investment in their businesses. Included in that investment will be pay increases for staff.
The full interview is here.