University of Otago research has, for the first time, confirmed New Zealanders are indeed better off if they become disabled through injury rather than illness.
Researchers from the Otago University's preventive and social medicine department have shown people who become ill or sick and cannot work are socially and economically disadvantaged by the financial supports they receive from welfare benefits, compared with the financial supports people receive from the ACC system, if they cannot work because of injury.
Dr Susan McAllister led the research for her PhD, conducting a comparative study of 109 people aged under 65 years who had a stroke and comparing their outcomes with 429 people who had a similarly debilitating injury.
The study, which has been published in the international journal Social Science and Medicine is the first to compare the socio-economic consequences of different financial supports after illness or injury in New Zealand.
The study found people who were injured were more likely to get back to work in 12 months, had a better standard of living, and maintained a higher level of income over their recovery period because they had extra financial and return-to-work support from the ACC scheme.
And while people who fell ill were eligible for sickness benefits and had their treatment costs covered, their weekly allowances on the benefit were means-tested, compared with compensation under the ACC scheme, which pays out up to 80% of a person's weekly wages while recovering, plus treatment and rehabilitation supports.
The research found the median personal income of the stroke group declined by 60% over the years, compared with a 13% decline in the injury group.
A significantly greater portion of the injury group (79%) was back at work after 12 months, compared to 49% of the stroke group.
The differences were most likely due to the extra financial and return-to-work support ACC offered injured people, through its rigorous case management of individuals, to try to get them back to work as soon as possible.
Dr McAllister said the findings had implications for welfare policies and, while the welfare reforms were more focused on getting people back to work, the new benefits would still remain at more or less the same level and be means tested.
It would still need a much more comprehensive package to close the gap in socio-economic outcomes of those who were injured and those who were ill.
She said the original recommendation made in the 1967 Woodhouse Report was for both illness and injure to become part of an ACC-type scheme, but it never happened and the apparent unfairness of the scheme had been the subject of considerable controversy over the years,''Our study suggests these concerns are indeed well founded.''
ACC Minister Judith Collins dismissed a suggestion from Sir Geoffrey Palmer last year that illness should be part of the ACC scheme, saying the scheme was never designed to be health insurance.
A spokeswoman from social development minister Paula Bennett's office said the reforms going through Parliament provided for more support for getting people on sickness benefits back to work.
