NSW government defends controversial workers compensation reform
The workers compensation scheme has 'become a place where industrial relations and general health issues' are being borne out, the NSW government claims as hotly contested reforms are put to the test in the first public hearing.
A parliamentary inquiry into the proposed reforms will hear from a range of government, union, and business leaders on Friday morning, including the NSW Teachers Federation, the NSW Bar Association, and Unions NSW.
Unions NSW secretary Mark Morey, who will give evidence, said 95 per cent of workers with a permanent impairment from a psychological injury would not receive compensation due to the proposed 31 per cent threshold.
The new threshold for damages is part of a raft of proposed changes to overhaul the system and tighten claims for psychological injury, including requiring sufferers of racial, sexual harassment or bullying to obtain a court finding first.
NSW Industrial Relations Minister Sophie Cotsis told the committee in her opening address that there was 'no doubt mental health is a societal issue'.
'But, the increase in psychological claims would indicate that the system has become a place where industrial relations and general health issues are being managed through a system that was designed to support those injured at work, to recover, and to return to work.'
The inquiry was told claims for psychological injury had doubled in just six years, 91 per cent of physical injury claims resolved within 13 weeks, while 50 per cent of psychological claims were not resolved after a year.
Ms Cotsis said there were 3068 NSW public sector workers on workers compensation claims awaiting returning to work.
'Now this is unacceptable because these public sector workers have capacity to work, but the system has these artificial barriers that doesn't allow them to get back into the system,' she told the inquiry.
Treasurer Daniel Mookhey told the hearing the upcoming state budget would report a $2.6bn writedown arising from the Treasury Managed Fund, the government's self-insurer.
'As the TMF continues to deteriorate, the pressure for cash injections grows,' Mr Mookhey said.
'Since I became treasurer, the government has authorised an additional $1.2bn in cash injections to keep the public insurer fully funded.'
Since 2018, the state government has borrowed $6.1bn so that the TMF's assets equalled its liabilities.
'I will not be authorising any further injections,' Mr Mookhey said.
'Not until parliament decides its collective response to a scheme that most acknowledge is failing.
'Not when that money is coming at the expense of schools, hospitals or kids in need of out-of-home care.
'That choice is clear for me.'
Opponents of the changes have accused the government of attempting to rush through the amendments, with the Law Society of NSW calling for a 'pause' so that broader consultation and key changes to legislation can be enacted.
President Jennifer Bell said on Thursday that while the system was under pressure and in need of reform, the 31 per cent threshold would exclude 'nearly all workers with psychological injury' from being able to make a claim.
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