Cuts to entitlements of injured workers in New South Wales are likely as the state battles to deal with a ballooning deficit in the WorkCover scheme.
Announcing a parliamentary inquiry into the scheme on Monday, NSW Finance Minister Greg Pearce says the state’s WorkCover scheme is not viable in its current form.
According to a report on Australian Associated Press, Pearce says the scheme has a deficit of $4.1 billion and that urgent changes are required in order to avoid a dramatic rise in premiums.
According to the report, Pearce says he cannot guarantee that no worker will be worse off as a result of any changes made as some form of change is inevitable.
“We want to be as generous as we can to injured workers,” he told reporters in Sydney on Monday. “We want to see injured workers looked after and return to work as quickly as they can, but the scheme has to be viable. Our problem is that at the moment it is not viable.”
Pearce stresses that the government has not made any firm decisions as of yet, adding that the inquiry will be transparent and will give all relevant stakeholders an opportunity for input.
However, he has ruled out addressing problems by simply raising premiums by 28 per cent – the amount required to address the current deficit as it stands. This means that some form of rationing of worker entitlements is more than likely.
Both the state opposition and the Greens Party have slammed the inquiry as an attack on workers’ rights to fair compensation for injuries suffered as a result of their work.
NSW Opposition Leader John Robertson, who has predicted ‘massive cuts’ to entitlements, describes the current safety net as ‘the difference between families losing their house or being able to pay their bills while they are rehabilitated to make their way back to work.’
Greens MP David Shoebridge, who says the committee will have the remit to brutally attack workers’ rights’, backs Robertson’s claims, saying that injured workers and their families will be forced into poverty if any cuts are brought about.
The AAP report says both the opposition and the Greens accuse the government of stacking the parliamentary inquiry with conservative MPs from the coalition, Shooters Party and Christian Democrats to ensure it recommends cuts to compensation payments. There are only two Labor MPs on the eight person committee, while the Greens have been excluded entirely.
Unions New South Wales says it will participate in the inquiry, but Secretary Mark Lennon says the one-month time frame given to the committee to report back to the government is insufficient given the nature and complexity of the issues involved.
The inquiry comes amid a state of turmoil in the New South Wales construction industry. Already, 102-year-old building firm Kell & Rigby has been liquidated, and another firm, Reed Constructions, is in financial distress. These issues could potentially leave more than one-thousand contractors unpaid for government work. The latest developments also follow union calls for an inquiry into the industry amid concerns that nonviable tendering bids are forcing building firms to take shortcuts on safety.