New South Wales taxpayers are facing a voracious monster that is five billion dollars in debt. It is called " Workcover " - and unless it is tamed it will continue to bleed the tax system and reduce funds for other essential services.
When a person is injured at work, Workcover springs into action and provides both immediate sustenance to get the injury healed - and that person back into the work force. It is also responsible for supplying compensation when the injury leaves permanent damage. Workcover has an annual budget cost of $ 13 billion - and serviced 28,000 injured workers in the past financial year.
The government is looking at restructuring the scheme, and this will not be popular with many people. Lump sum compensation is likely to be scrapped in favour of regular monthly payments, and restrictions will apply by way of a time frame. There will be a cut off point at which payments cease, except for those that are totally and permanently incapacitated.
It sounds harsh, but then all compensation schemes are prone to rorts and in a time when jobs are hard to find there is a tendency for people to prolong recovery and extend the time they take while receiving compensation payments. The emphasis of Workcover will change from merely paying sustenance - to giving the injured training to learn new skills and re-enter the workforce in a new job where that old injury is no longer a handicap.
One of the problems with lump sum compensation payments in the past has been the ability of receipients to manage the money. Money that is supposed to last a lifetime can be easily squandered if it is not invested wisely, Regular payments remove this hazard, and they can be indexed for inflation.
There seems no doubt that a revamped Workcover will be less generous than the old scheme, but the present system is unsustainable, and if left unchecked it will continue to accumulate debt until sheer necessity forces drastic change.
Few would object to realistic rules to cover worker's compensation, provided that the guidelines that apply are crystal clear - and fair. Hopefully, this new approach will remove the " lottery " mode that exists at present, when similar cases deliver very different outcomes because of the skill of the lawyers presenting each case - and the attitudes of different judges.
Certainty in compensation would be a welcome factor !
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