Warning as workers thrown off revamped compo scheme
Restricting Victoria’s workers compensation scheme has kicked hundreds of them off payments within months and sparked a $565 million turnaround.
Changes to the WorkCover scheme to restrict eligibility and increase testing requirements in a bid to curtail skyrocketing costs came into effect at the end of March.
The scheme recorded a $389 million profit in 2023/24 after posting a $176 million loss across the previous financial year, WorkSafe’s annual report shows.
That result was $1.22 billion higher than the target, with reduced claims expenses cited as a contributing factor.
The Community and Public Sector Union accused the Labor state government of “profiteering” off injured Victorians, after The Age reported 726 workers had their financial support withdrawn in the first four months since the rules changed.
“The financial turnaround in only a few months confirms the changes went too far,” the union’s Victorian branch secretary Karen Batt said.
“I estimate that from June until the end of 2024 another 1600 workers with accepted claims will come up for assessment.
“And if the percentage thrown off the scheme runs the same that’ll see another 1200 injured workers who will not be entitled to continued support.”
Under the changes, workers suffering stress and burnout are no longer be able to access weekly WorkCover benefits but can still receive up to 13 weeks of provisional payments to cover medical treatments and services.
Workers receiving payments beyond two-and-a-half years now have to undergo another impairment test to determine if they are unable to work indefinitely and meet a “whole person impairment” of more than 20 per cent.
In the face of staunch opposition to the bill from unions and the crossbench, Labor did a deal with the coalition to freeze premiums for businesses for one year to secure its passage through parliament.
Some 98,000 Victorians received WorkCover support in 2022/23 and taxpayers had topped up the scheme with an extra $1.3 billion to offset rising costs.
WorkSafe Minister Danny Pearson said 33,000 injured workers were currently receiving weekly payments, with 26,000 returning to work last financial year.
“The way in which (the scheme) was previously constructed cost business a fortune, it cost the government a fortune and it made injured workers sicker,” he said.
He suggested it was too early to tell if there were any “unintended consequences” that needed to be fixed.
“I appreciate that this is four months’ worth of data,” Mr Pearson said.
“But we need to allow for the time for the scheme to … recalibrate and that will take some time to work its way through the system.”
A panel of independent experts will consider the impact of the reforms in 2027 as part of a statutory review.
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