9 Dec 2015

ACC changes mean most car owners $65 better off

7:44 am on 9 December 2015

Most car owners will save more than $65 a year on their vehicle registration after major levy reductions announced by the Accident Compensation Corporation (ACC).

Traffic north of Wellington.

Heavy traffic north of Wellington. Photo: RNZ / Alexander Robertson

The ACC cuts come in from the middle of next year and would add up to $450 million in savings. The move follows recent changes to an annual warrant of fitness (WoF) for vehicles built in 2000 or later.

The drop will be the second fall in two years. An annual registration for the 2015/16 year costs on average $194.25 - down from about $330. For the 2016/17 year the average cost will fall to $130.26.

Ginny Carey's family has several cars to register, so the savings will be significant.

"We've got three vehicles that we register so it would make my life happier, but I am wondering what affect it could have on what the ACC levies provide," she said.

Issac Wihongi said the changes would leave him with more cash to spend on car maintenance.

"What do I think of it? I think it's actually good, the less you pay because other things you have to pay to get a warrant that does cost alot," he said.

ACC Minister Nikki Kaye said the reduction meant the vehicle levy was now at a historically low level.

The Automobile Association's (AA) Mark Stockdale said these cuts should have come sooner.

"Because they were record high levies and some motorists were finding it difficult to pay those levies and were only licensing their vehicles for six months of the year," he said.

The petrol levy paid at the pump is not changing and stays at 7 cents a litre, but Mark Stockdale said only a 1 cent reduction was being proposed, so it would have made little difference.

Another car owner Hayley Jones said a less pricey registration was timely for her family.

"We're expecting a baby so every dollar counts as we'll be going down to one income so extra dollars do count for us," she said.

Motorcycle registrations will come down by $5 but the ACC Minister, Nikki Kaye, said a range of new safety initiatives would be rolled out next year. And as the Automobile Association pointed out, in the event of a serious accident, motorcyclists were 20 times more likely to be injured.