The Report of the Statutory Authorities Review Committee into WorkCover had now been completed and published.
“The Committee’s Report highlights that Premier Mike Rann had broken another key promise by not reducing the WorkCover average levy rate by June 2009,” Shadow Minister for Finance Rob Lucas said today.
The following graph shows the average levy rates in SA are now the highest of all states in the nation and second highest to the ACT.
(Please refer to attached table)
“It is clear that the promise by Mr Rann of achieving a 2.25-2.75 per cent levy rate by June 2009 had not been achieved, therefore continuing to leave SA’s businesses in an uncompetitive position,” he said.
“This is just another key broken promise by Mr Rann and shows why most South Australians no longer trust him and his Labor Government.”
“To quote a popular television advertisement: “Trust! Who can yah?”
“The Report also highlights the unacceptable nature of our WorkCover scheme with unfunded liabilities still over $1 billion.
“The Report shows that the unfunded liability in June 2001 under a Liberal Government was only $55.5 million, but has now exploded to $1,059 million in June 2009 under the Rann Government.”
Year Ending Unfunded Liability ($m) % Fully Funded
2000/2001 55.5 93.5
2001/2002 192.4 79.7
2002/2003 591.1 55
2003/2004 572.1 60.4
2004/2005 652.1 63.2
2005/2006 694.1 67
2006/2007 843.5 64.4
2007/2008 984.0 60.8
2008/2009 1,059.0 56.7
“Liberal members of the SARC also expressed concern that Rann Government Members and WorkCover had prevented the public release of more information on the renegotiated contract between WorkCover and Employers Mutual Limited as claims managers,” Mr Lucas said.
“In particular, the Rann Government and WorkCover were refusing to provide details of increased payments of $17.2 million in 2008-09 to EML under the renegotiated contract.”
The Majority Report of the Committee (comprising Liberal MLCs Rob Lucas and Terry Stephens, and Independent MLC Ann Bressington) had strongly recommended that the monopoly claims management contract be opened up to competition as soon as possible.
The Majority Report also recommends that the Rann Government and WorkCover should stop the current practice of significantly increasing ‘exit or discontinuance’ fees to try to stop employers fleeing the uncompetitive WorkCover system to become self-insurers.