Workers’ compo threat
Monday, 21st May, 2012
The NSW Government’s review of the WorkCover scheme to reduce its $4 billion deficit could cost workers dearly, according to a local law firm.
Samantha Harvey, from Slater and Gordon which specialises in workers compensation, said the proposal was likely to form the basis of an overhaul of the scheme that might strip away basic entitlements.
“WorkCover NSW has a $4 billion deficit but Government needs to ask why. The answer lies in poor investment decision in the Global Financial Crisis and dysfunctional and costly claims handling,” Ms Harvey said.
“The State Government should not blame the worker. They need to get their own house in order.
“The government says it needs to make reforms, which isn’t a problem. It’s the proposals in the reforms that are a problem.
“The government is focusing on cutting injured workers’ entitlements rather than looking at the huge blowout in red tape, payments to insurance companies and administrative costs which have caused most of the problems.
“They want to cut the amount of payments, limiting them to two years. They want to remove payments from workers with a permanent injury. It is not fixing the problem, it is just a knee-jerk reaction.”
Ms Harvey said WorkCover had released figures showing where the problem was.
“Since the late 1990s the cost of managing WorkCover has gone from $70 million to $630 million by 2010.
“In the same period payments to insurance companies skyrocketed; in 2002 it was $200 million and it went up to $476 million in 2010. But the number of major injuries has halved and the amount of pay outs to injured workers has declined in the same period,” she said.
Ms Harvey said the administration costs need to be fixed or it risked shifting the problem to Centrelink.
“It will not fix the problem, nor would hitting employers with higher premiums,” she said.
“It’s time for administration costs to be addressed. I am very concerned for workers’ rights. I have seen what they go through.”
Ms Harvey said one of the possible reforms could include injured workers who can’t return to their former duties losing payments.
She said this could have a devastating impact on workers in the Broken Hill area.
“For workers in remote communities such as Broken Hill there may not be other opportunities to work, given the small population,” she said.
“There is a limited labour market. Workers want to get back to work but will be severely prejudiced if these reforms come into effect.”
She also said claims by Acting NSW Premier Andrew Stoner that there will be “no loopholes in the scheme” was unfair.
Mr Stoner was reported as saying, by the Sydney Morning Herald on May 14, that the new scheme will not allow for rorts.
But Ms Harvey said there were was no proof that workers were rorting the system.
“Of the 80,000 claims only nine prosecutions have been made for this type of thing. How is that a massive problem? We would like to see the Member for Murray-Darling, John Williams, stand up for workers,” she said.
“Mr Williams needs to stand up for injured workers and not let them be demonised. It is unfair and unjust.”
Mr Williams said that despite everything that was being said, the deficit was still $4 billion.
“The deficit has to be corrected before small businesses across NSW have to pay higher premiums,” he said.
“There is a cross parliamentary committee that will review the situation and make recommendations.”