Presented by Robert Clark MP		www.robertclark.net

REPORT SHOWS $237M INCREASE IN WORKCOVER BURDEN

News Release - Thursday, 14th March 2002

The latest figures released by the Victorian WorkCover Authority show that unfunded WorkCover liabilities are $237 million higher than when the Bracks Government came to office, Shadow WorkCover Minister, Robert Clark, said today.

Mr Clark also said the Government was counting its chickens well before they were hatched in suggesting that WorkCover costs were under control.

"When Labor came to office, unfunded WorkCover liabilities stood at $296 million. The latest estimate now places unfunded liabilities at $533 million," Mr Clark said.

"As the Opposition has pointed out previously, what has happened over recent months is that some of the more outrageous claims that were lodged prior to the amended deadline of 31 August 2000 set by Labor for lodging serious injury claims under the pre-1997 common law rules have been cleared out of the system for less than the original cost estimates.

"This is not surprising, because the actuaries initially valued those claims based on historical claims patterns, without fully taking into account the fact that law firms and unions had deluged the WorkCover system with hundreds of dodgy claims following Labor's rule change.

"The Auditor-General's report in June last year found that Labor's legislation changing the deadline for lodgement of common law claims was the most significant development contributing to the massive unfunded liability figure.

"WorkCover's own actuaries confirmed in their December 2000 report that the last minute surge of claims before the 31 August 2000 deadline was unexpected because plaintiff law firms had indicated previously they did not have a significant backlog of claims to be notified.

"In short, Mr Cameron was dudded by his Labor lawyer mates and by the unions. Once he changed the cut-off date, they emptied out their bottom drawers to lodge every dubious claim they could find. Labor has well and truly re-ignited the 'compo culture'.

"Even after eliminating or revaluing some of the more outrageous claims, there has still been a $237 million deterioration since Labor has been in office. When they came to office WorkCover was on track to return to the black by February 2001 with a premium rate of 1.9%. Now even with a premium rate of 2.22% it is not expected to return to the black until more than three years later in June 2004.

"This is the exactly the same date for reaching full funding as was estimated as at June last year, showing that over the last 6 months there has been no real gain compared with estimates.

"It is also far too early to conclude that the costs of Labor's new common law system can be controlled - there have just not been enough new common law claims handled through the system to reach that conclusion."