New Zealand's Accident Compensation Corporation (ACC) has released its 2026/27 Turnaround Plan against the backdrop of an outstanding claims liability of $63.6 billion, an investment fund of $51.1 billion, a confirmed CEO departure, and an independent government-commissioned review that found serious issues with the organisation’s governance, case management, and performance culture.
ACC is a statutory monopoly under the Accident Compensation Act 2001, administering a compulsory, no-fault scheme funded through levies on employers, earners, and motor vehicle owners, as well as general taxation. Every dollar of scheme underperformance feeds into future levy rounds – a direct cost for New Zealand businesses and workers.
The 2026/27 plan is the second phase of a reform programme responding to an external review commissioned by the Minister for ACC following levy decisions in December 2024. Finity Consulting Ltd, engaged by the Ministry of Business, Innovation and Employment (MBIE), found that ACC had experienced a loss of operational focus over time with inefficient claims management and a decline in effectiveness of rehabilitation support and identified a weak performance culture driven by a lack of incentives for people to come off ACC and weak accountabilities across the system. An earlier change in case management had not worked, and concerns were not taken seriously. Those findings sit behind every metric in the turnaround plan. The 2026/27 document states that 79% of the 48 actions from the first phase are now complete.
In 2024/25, ACC’s Outstanding Claims Liability (OCL) rose $3.3 billion to $63.6 billion, while the investment fund stood at $51.1 billion. The gap reflects a decade in which total rehabilitation and treatment spending rose from $2.3 billion to $5.0 billion – well above demand, population, and inflation growth, according to the 2026/27 plan document. Sensitive claims – covering people who have experienced sexual abuse or assault – have been a material driver. In 2024/25, sensitive claims contributed $541 million to the OCL strain, with weekly compensation payments increasing significantly due to backdated payments linked to a December 2023 Court of Appeal ruling that expanded eligibility. The 2026/27 plan identifies sensitive claims as an ongoing pressure on both the long-term claims pool and the Non-Earners’ Account. A legislative response – the Accident Compensation (Scheme Boundaries and Other Matters) Amendment Bill – has been under ministerial consultation, according to Treasury documents, as a mechanism for addressing court-driven liability expansion.
That financial pressure is already flowing into levy rates. Cabinet confirmed in December 2024 that levy rates across all three levied accounts would rise across 2025/26, 2026/27, and 2027/28, with the Earners’ levy moving from $1.39 to $1.59 per $100 of liable earnings over that period and the average Motor Vehicle levy rising from $113.94 to $141.69 per vehicle. Levies are intended to cover the lifetime cost of rehabilitating those injured in a given year, meaning sustained underperformance compounds future rounds.
ACC’s June 2026 Monthly Turnaround Plan Report shows mixed results against 2025/26 targets, though materially better than pre-turnaround projections. Three of four short-term return-to-work measures fell short of target: the 28-day rate reached 36.6% against a 37% target, the 10-week rate 62.2% against 63%, and the nine-month rate 89.7% against 91%. The one-year rate exceeded its 92% target at 92.2%. The long-term claims pool stood at 24,454 – above the 24,000 target but well below the pre-turnaround forecast of 26,180. Weekly compensation costs came in approximately $250 million lower than expected.
The 2026/27 targets require a further performance lift across every measure, with the long-term claims pool targeted at 23,000 to 23,500 this year and below 20,000 by 2029/30. Board chair Jan Dawson acknowledged the distance remaining: “While these results show ACC is moving in the right direction, they also underline that the turnaround is not complete, with more work needed to achieve key performance targets.”
For insurance professionals working with large employers, the 2026/27 plan sits alongside a separate structural change that took effect on April 1, 2025. Revised Accredited Employer Programme (AEP) rules introduced a new performance monitoring model, updated health and safety assessment requirements including ISO 45001 certification as an option, and expanded pricing choices under the Partnership Discount Plan. The 459 employers in the programme cover 21% of New Zealand’s workforce. Under AEP, accredited employers take on ACC’s role in assessing and managing work injury claims in exchange for a reduction of up to 90% in their Work levy – making scheme performance directly relevant to their cost base.
Outgoing CEO Megan Main confirmed in December 2025 she would not seek reappointment when her five-year term ends in late 2026. ACC has appointed Sid Miller OBE – former general manager of claims management at ACC and former CEO of EQC – following an international recruitment process. Miller begins on September 21, with deputy CEO Stewart McRobie acting in the interim. Miller’s EQC tenure encompassed a full operational and cultural restructuring following a public inquiry – a direct parallel to ACC’s current position. Whether the 2026/27 plan’s 13 actions can be sustained through a chief executive transition remains the near-term question for scheme stakeholders.
