In NZ accident costs (medical treatment and rehab) is covered by the government. Car owners pay a levy because car accidents are so common. Cyclists don't.

I think that if the country pays your medical costs rather than you having to pay medical insurance or out of your own pocket, then the governemnt DOES have a right to mandate safety things, like wearing a seat belt, or wearing a cycle helmet. Yes, it won't stop an accident but at least hopefully the cost of putting you back together is reduced.