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House of Assembly - Fifty-First Parliament, Second Session (51-2)
2008-02-28 Daily Xml
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Question Time

WORKCOVER CORPORATION

Mr HAMILTON-SMITH (Waite—Leader of the Opposition) (14:12): Does the Premier now accept that changes made to the operation, management structures and administration of WorkCover Corporation by him and his ministers after coming to government in 2002 caused the debt, levy and benefits crisis presently before the state? Under the same legislative arrangements that exist today, the former Liberal government delivered, to quote the Clayton report precisely, 'claim payments which were very well controlled, reducing in real terms throughout the five-year period'. Clayton-Walsh observe on page 8 of their report that, under the former Liberal government, 'The scheme began in the 2000s in an apparently healthy position with respect to both financial stability and reputation for forward thinking.'

Members interjecting:

The Hon. P.F. Conlon: You've asked your question.

The SPEAKER: Order!

The Hon. K.O. FOLEY (Port Adelaide—Deputy Premier, Treasurer, Minister for Industry and Trade, Minister for Federal/State Relations) (14:14): The critical word in that is 'apparently'. The legislation that we are dealing with, as it sits in its current form today, is the same legislation that was in place when the former Liberal government left office. What then occurred was that we replaced the board and the board replaced management.

Mr Hamilton-Smith interjecting:

The Hon. K.O. FOLEY: The Leader of the Opposition has just said, 'Oh, well, that was successful.' The Leader of the Opposition continues to criticise and cast aspersions at the—

Mr Hamilton-Smith: Whose fault was it?

The SPEAKER: Order!

The Hon. K.O. FOLEY: —board and management of WorkCover.

An honourable member interjecting:

The Hon. K.O. FOLEY: All right. In this chamber—

Mr Williams interjecting:

The SPEAKER: Order! The member for MacKillop is warned.

The Hon. K.O. FOLEY: —the theatre of politics and the Westminster system can be used to create, or attempt to make, a political point. Obviously, the minister of the day and the cabinet of the day are responsible—and the Treasurer—for financial performance of publicly-owned corporations. Absolutely—there has never been an argument about that—but because we have a structural system, a corporatised system, where we put in place boards of management, we devolve the day-to-day management and the day-to-day administration of these organisations to boards and management.

Members interjecting:

The SPEAKER: Order! The Deputy Premier has the floor.

The Hon. K.O. FOLEY: The government has never walked away from its responsibility; quite the opposite in fact. What we are doing now is accepting our responsibility as a government to fix legislation that is clearly structurally unsound in terms of its ability to support the organisation.

The board itself a year or so ago came to government and released publicly a set of recommendations that it believed were appropriate changes in large part—well, you can shake your head all you like, Mitch.

Mr Williams interjecting:

The SPEAKER: Order!

The Hon. K.O. FOLEY: The board itself put forward a set of recommendations that it believed needed to be made to ensure that the scheme was financially sound going forward. Many of those changes have been picked up by the Clayton review.

Members interjecting:

The SPEAKER: Order!

The Hon. K.O. FOLEY: The essence of what both the board and Clayton have put forward is the level of benefits available to workers in other jurisdictions of Australia, other states and territories of Australia. It cannot be argued that this is other than the truth: that is, that benefits under this state government's scheme, the statutory scheme approved by this parliament, are far more generous than benefits available in other states. It is a simple equation of mathematics that the scheme has been paying out more than it is able to earn to offset its liabilities. It is a simple equation. The board came to government 12 or 18 months ago with its concerns about this matter.

We did not accept those recommendations. We wanted to put them to an independent assessment. That independent assessment has been undertaken. I stand by the board of WorkCover. You may not; I do. I have absolute faith—and I know the minister does and the government does—in all the members of the board.

I note that Janet Giles has recently resigned. Janet Giles has been a very good member of that board. She herself is fully aware of the problems of the organisation. I understand the political need for her now to resign from the board. Janet and all the board members have been fully briefed, fully aware, fully consulted and obviously have been doing their best to ensure that, apart from the legislative reform that is needed, they have reformed every part of the organisation that they can to make it a more efficient organisation.

They have changed the management. They have outsourced—as much as I am sure this will annoy lawyers perhaps not just on that side—so that instead of a number of law firms getting contracts they bulked them all up and put them out to one tender which brought significant savings to the scheme.

Members interjecting:

The SPEAKER: Order!

Mr Williams interjecting:

The Hon. K.O. FOLEY: Yes, I do. What, you wouldn't have done that? You wouldn't let them do that?

Mr Williams interjecting:

The SPEAKER: Order! The member for MacKillop has already been warned.

The Hon. K.O. FOLEY: Another good move of the board was to consolidate and change the providers to EML and service providers. It is hoped that that itself will bring significant savings to the organisation. What cannot be argued—unless people are simply playing politics—is that the structural shape of the legislation—

Mr Williams interjecting:

The SPEAKER: The member for MacKillop is warned a second time.

The Hon. K.O. FOLEY: —means that we need to have reform. One thing this government has been prepared to do is consult.

An honourable member interjecting:

The Hon. K.O. FOLEY: Everyone was asked to consult and invited to put in submissions to the Clayton review. I notice the opposition did not—did not. My understanding is that Clayton spoke to a large number of people during this process to ensure that he heard the ideas, views and opinions of other people. We think that has been a good process, but we do not walk away from the fact that, especially for the Labor Party, this is a very difficult and emotional issue. This is not something we like to do or, quite frankly, want to have to do, and it does come with a degree of pain.

It is due to the great strength of the Labor Party that we have the ability to make a hard decision, even when we know that, if we had alternatives, we would much rather have taken them. What I said yesterday was that the time will come for the opposition to articulate its position, and I look forward to that. I only the hope that the media of this state will ensure that the leader is held accountable for—

Members interjecting:

The SPEAKER: Order!

The Hon. K.O. FOLEY: —his position and not given the free kicks, like he was this morning.

Members interjecting:

The SPEAKER: Order! It is now debate.

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