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House of Assembly - Fifty-First Parliament, Second Session (51-2)
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WORKERS REHABILITATION AND COMPENSATION (SCHEME REVIEW) AMENDMENT BILL

Second Reading

Adjourned debate on second reading (resumed on motion).

(Continued from page 2346.)

The Hon. K.O. FOLEY (Port Adelaide—Deputy Premier, Treasurer, Minister for Industry and Trade, Minister for Federal/State Relations) (11:49): I do not intend to speak for very much longer at all, particularly given the momentous tabling of the Children in State Care Report which has just occurred. Can I just conclude by repeating the point that the opposition leader and the opposition cannot be allowed to get away with wanting to be able to walk two sides of the street.

Mrs Redmond interjecting:

The SPEAKER: Order!

The Hon. K.O. FOLEY: This is a package of reform by which, on the advice that we have received, the unfunded liability will be extinguished within a reasonable time that is acceptable to the government and which, over time, will give capacity for a reduction in levy rates. It will bring our scheme in line with that of other states; however, importantly, because the Premier has made the very strident point, this will still be the most advantageous and generous scheme in the nation to workers, but it will be a scheme—

Mrs Redmond: Others might differ with that view.

The Hon. K.O. FOLEY: Well, you can vote against the bill if that's your view.

Mrs Redmond interjecting:

The Hon. K.O. FOLEY: Well, thank you.

An honourable member interjecting:

The Hon. K.O. FOLEY: No, no. I am just stating—

Members interjecting:

The SPEAKER: Order!

The Hon. K.O. FOLEY: I am just stating the obvious that—

Mr Williams: You're stuck with it.

The Hon. K.O. FOLEY: No, we are pleased that you are supporting it, because this will fix the problem.

Mr Williams: Such enthusiasm!

The SPEAKER: Order!

The Hon. K.O. FOLEY: We accept the advice of Alan Clayton and John Walsh. We accept the advice of Bruce Carter and the board. We accept the advice and the comments—

Mrs Redmond interjecting:

The SPEAKER: Order! The member for Heysen will have an opportunity to make a speech.

The Hon. K.O. FOLEY: The member for Heysen wants to introduce the third way: that is, they think that what we are doing is bad but they will let it go through but what we should have done is what the WorkCover Board said in the first place, which was a harsher response. We have three options now coming forward from the opposition. The government has dealt and toiled with this issue for some time.

As I have said before, this is clearly not an easy decision for a Labor government. This is a decision that has caused much angst within the Labor caucus, much angst within the Labor movement—

Mr Pisoni interjecting:

The Hon. K.O. FOLEY: Absolutely. There are unions protesting against this, and many of my colleagues are very unhappy about what this government is doing—and I respect their views. The Labor Party has demonstrated that, notwithstanding the fact that this has been an exceptionally difficult decision—and, dare I say, also a very difficult one for the minister—he should be applauded for the way in which he has managed to tackle a fundamental structural flaw in the scheme in the manner in which he has. This has not come—

Mr Pisoni: Now we know you don't believe it.

The SPEAKER: Order!

The Hon. K.O. FOLEY: This has not come easily to the minister, and I know that. It has not come easily to the cabinet, but it is what has had to be done. I think that what demonstrates a government's capacity to govern is that, even though a decision causes much friction, much tension, much emotion within a political party and its constituent bodies, at the end of the day it has the internal fortitude and the structural elements within the party to enable people to voice their opinions but for the party ultimately to reach a landing on a position. I have never been prouder of the Labor Party than I am today, because I think that the Labor Party has demonstrated that we are a natural party of government, that we are a party that can govern, that we are a party that has the inner—

Members interjecting:

The SPEAKER: Order!

The Hon. K.O. FOLEY: —strength to do what is right. I am pleased that the opposition, ultimately, will support this measure, notwithstanding their various positions they want to put. No doubt the shadow minister has obviously been rolled on this one, having said they would never support any changes. Talk about division within a political party! You now have our position and—

Members interjecting:

The Hon. K.O. FOLEY: I have not, for one moment, denied that this has caused tensions in the Labor Party—that is obvious.

An honourable member interjecting:

The Hon. K.O. FOLEY: I will believe that when I see it. This is what makes a government. In a vibrant democracy with parliamentary representation, it is quite natural, quite appropriate and quite understandable that there will be varying degrees of emotion, dispute and unhappiness within a political party when it makes a hard decision. We are not a dictatorship. Our nation, our country, our state and our political parties are organic beings: they all have a view; members are entitled to express their views, and those views have certainly been well expressed.

We have made some modifications to the bill which we think go some way towards addressing some of the serious concerns put forward but, in the main, it still holds the integrity of the piece of work that Alan Clayton has done and what we will accept in terms of getting the system right. I have never been more proud of the Labor Party than I have been today. It has shown that it is a natural party of government because it is prepared to take the hard decisions.

Mrs Redmond interjecting:

The Hon. K.O. FOLEY: The member opposite (the would-be attorney-general) keeps chirping. It is correct that there has been dissent and disagreement on our side internally. However, we are a party that can debate internally and we are a party that can take a landing. Today, the South Australian branch of the Labor Party has demonstrated that it is a natural party of government, that it is a good party for government and that it can take the hard decisions when it is in the community's interest, not within its own self-interest. It can put self-interest aside as the Labor Party and govern for what is in the state's interest. That is the characteristic that makes this a good government and a government that, I think, will continue to lead this state for many years to come.

Dr McFETRIDGE (Morphett) (11:57): I rise as the lead speaker on this bill. I will begin by saying that this is bad legislation. This is legislation that is not going to fix up the mess created by this government—and this is its response to it. During my second reading speech I will be reading into Hansard a number of submissions and, certainly, a series of amendments that have been put by a number of groups, including Business SA.

I ask that the minister take these amendments on board and, before we go into committee, give us the reasons why these amendments have been rejected or whether, in fact, the government has some amendments of its own or whether it is going to adopt any of these amendments as its own amendments, because that will give reason for discussion on this side. Certainly, some of the suggested amendments have been put in various categories: some that must be accepted, some that should be accepted, and some that we would like to have accepted. The amendments come from various groups. I urge the government to consider the submissions that I will be putting into Hansard, including their accompanying amendments.

First, I say that, at least on this side of the house, we can speak up publicly about how we feel about what should be happening in this state, what should be happening with workers' rights, and what should be happening to fix up the financial mess that has been around for a number of years. The government has been in place for six years and we have seen it launch a number of reports. Some of them have been sat upon for quite a while and others have never seen the light of day to any real extent.

I will be referring to a lot of those reports in my second reading speech and making sure that the house and those who read Hansard are aware of the facts of history, not the rewritten history that has been put up by so many members of the government and some commentators around the place. We need to make sure that the full history of WorkCover in South Australia is on the record in an accurate fashion because over the past few months we have seen a lot of rhetoric and spin, and today we see a piece of legislation that is not the answer to the problems we have.

The government has insisted that this is its solution to the problem. Today, we have heard the Deputy Premier say that this is good legislation from solid leadership—that is what he believes—but if leadership is about punishing workers (who do not go to work to get injured, by the way), this government is punishing workers. The retrospective elements of this legislation cause issues for people. Some issues here need to be resolved, but we on this side can count. The government has insisted all along that this is its solution to its problem, and we know what a problem it is.

Tomorrow we understand that the WorkCover Board will be receiving the latest actuarial reports on what the WorkCover blow-out is, and I reckon it is going to be around the $1 billion mark. That is just the WorkCover side of things. I will be reading into Hansard from both the Clayton report and the Statutory Authorities Review Committee (SARC) report details of the history of the unfunded liability and the funding position of WorkCover so that the house and those who read Hansard are abundantly clear on what has happened in the past six years. I will refer to the change in both the unfunded liability and the change in the funding position of the scheme; it has gone downhill so fast.

I will also refer to the fact that the Public Service Association, which represents thousands and thousands of employees employed by one of the biggest employers in South Australia (the South Australian government), came to see us. Who is the CEO of the South Australian government? Who is the boss? The Premier. We will be seeing what he will do to his workers under his piece of legislation.

I will compare the stark difference between the results being encountered by registered employers through the WorkCover Corporation and the single management agent we have at the moment in Employers Mutual Limited; I will be comparing that with the self-insurers' position, which is an entirely different position. People have said it is like comparing apples with oranges, but it is not. The legislation is the same; the range of cases is the same; the opportunity to retrain and rehabilitate workers is the same.

I have mentioned that word 'rehabilitation' because this is what this legislation is all about. It is the workers rehabilitation and compensation scheme. Rehabilitation should be the first emphasis, but we see in this bill very little mention of the R-word. There is some mention of the C-word but all that is about is cutting compensation. We do not see much at all about the R-word. I will read in a submission from some of the rehabilitation providers as well.

It is a completely untenable situation to allow this burgeoning blow-out to continue, so the opposition will not get in the way of what the government considers to be its solution today. We will be making sure that we review all the submissions, all the amendments, and we will be reviewing the whole structure of the workers rehabilitation and compensation schemes in South Australia to make sure that, when we go to the election in 2010, we will have a position that will really fix this for the long term. We will not offer short-term gain for long-term pain, which is what this bill offers.

This bill really is not something that I would be proud of if I were the minister, and certainly I know that several people on the government benches are privately very concerned about this. I will not name and shame those people here; they know who they are, and I feel very sorry for some of them. Some of them are good friends of mine for whom I have a great deal of respect, but I realise the disciplines and the penalties that are in place on the government side, so they are silenced on this matter. We know what they are saying privately, but when they are speaking out publicly, what do we have? We have complete silence from all members on the other side publicly. The Premier has been really quite quiet on this. I understood that he was going to be in negotiations all weekend with stakeholders over this, but I think I was given a bit of a bum steer by senior advisers to the minister.

What I intend to do today—and it will take a while because there are a number of submissions, some of them quite long—is to put some interesting submissions on the record to make sure that they are taken on board by the government—this is post the bill being drafted—and to ensure that the amendments that are being proposed by these various stakeholders are at least considered. As I said before, I would appreciate the minister coming back to the house before we go into committee to give us an idea of what the government is going to support, if it supports anything, and, if it is not going to support anything, why it will not support them. Certainly, I expect that the opposition will be given the opportunity to consider any amendments that the government may be considering.

With that, I will just give the house a bit of a potted history of the Workers Rehabilitation and Compensation Act. I thank Dr Zoë Gill in the Parliamentary Library for the work that she has done on this and also on some of the stakeholders' claims. Members of the Parliamentary Library staff often go without the credit that is due to them for the hard work and research that they do for many members in this place on both sides. The report that was put out by Dr Zoë Gill on 27 February (my late father's birthday) is entitled 'The Workers Rehabilitation and Compensation Act 1986: A Chronology'.

We go back to 1986 and the reasons for the introduction of the bill given in the second reading speech by the Hon. Frank Blevins. He stated that there was a need to introduce legislation for the following reasons:

Increased premiums—including an increase of 160% from 1980 to 1984. Further, whilst premiums had tapered off since 1984, the federal Insurance Commissioner had foreshadowed further increases. This was partly to do with Insurance companies needing to recoup their underwriting losses.

Victoria had recently introduced its ‘WorkCare’ scheme, which had dropped premiums from 4.81 per cent of gross earning to 2.26 per cent—

this is 1986, remember—

and South Australia needed to achieve something similar to remain competitive.

That was 1986—22 years ago. The other reasons for introducing the bill included deterrents to rehabilitation:

...under the then current system it was difficult for injured workers to get [full] employment because of the practice of insurance companies loading premiums of organisations that hired such workers. Lengthy delays in settling disputed claims also inhibited rehabilitation.

The main aims of the bill, according to the second reading speech, were to:

Provide for 'significant reductions in current premium levels and to introduce greater stability in the setting of future premiums'.

Provide for a no-fault system of benefits for injured workers. It sought to overcome the then 'current inequitable system where adequate compensation depends on a worker having to prove negligence under the common law. The prime emphasis under this [1986] bill is to compensate injured workers according to their needs and not on a basis of having to prove fault.'

The aims of the bill continue:

Provide for an emphasis on rehabilitation. With respect to organisations, the Bill encouraged rehabilitation both through reducing disincentives to reemploying injured workers by sharing the costs of secondary injuries and through providing positive incentives to organisations employing injured workers by reducing premiums for organisations that assist in rehabilitation and that provide alternative duties.

That is certainly something that Alan Clayton focused on in his report to the Tasmanian government recently. The Tasmanian return to work incentives were quite highly lauded by Mr Alan Clayton. It continues:

With respect to workers, the bill provided for the suspension or reduction of benefits if workers failed to cooperate with rehabilitation programs. The reduction of the role of the legal system and of the common law was also seen as facilitating rehabilitation.

That was 1986. WorkCover was to be responsible for the first weeks of claims for unrepresentative disabilities, including injuries from accidents on the way to or from work, at the workplace before or after work, or during an authorised break, or while attending an approved training establishment; employers to be reimbursed for any costs over $150 for transporting an injured worker for immediate medical attention. The Sunday Mail said:

If a worker does not lose time from work but needs dental, optical, chiropractic or similar treatment for a work injury, a medical certificate is no longer necessary and WorkCover will pay.

The last point made was as follows:

Domestic workers will be covered automatically, whether they work just once or on a regular basis. Previously, cover was only given to domestic workers who worked for the same household on more than five occasions each year.

Taxi drivers who did not own or lease a plate would be brought under the WorkCover scheme. The last point was that clergymen were to be guaranteed cover, unless protected by acceptable alternative schemes.

Changes were made to the act in 1990, 1991 and 1993. On 11 December 1993, a state election saw the Brown Liberal government replace the Arnold Labor government. In December 1994, the act was opened again, and some significant changes were made. I understand that most of the debate was in 1995, and I will refer to some of the speeches that were made at that time by members who are still in this place. In his second reading contribution on 1 December 1994, the Hon. Graham Ingerson said:

...successive Labor Governments failed in their responsibility to reform the scheme and protect its capacity to meet those high ideals.

The result is that this Government inherited a workers rehabilitation and compensation scheme in need of structural reform to protect its viability and return to employees, employers and the community the benefits of a fair and affordable State based rehabilitation and compensation scheme.

Where have we heard that before? We are hearing it again now. On 18 October 1994, parliament was informed that an independent actuarial assessment of WorkCover's outstanding claims viability for the year ending 30 June 1994 showed that the scheme had unfunded liability of approximately $111 million. It was then 86.6 per cent funded. The Hon. Graham Ingerson continued:

If the scheme continues to lurch into higher and higher unfunded liabilities, it will ultimately have no capacity to provide any level of realistic pension or lump sum support, let alone the unaffordable benefit levels currently provided for by the South Australian scheme. The state government's objective is to achieve a nationally competitive average levy rate of 1.8 per cent.

He went on to say

...reform to the WorkCover scheme in South Australia is not an optional extra. It is essential if this Government and this Parliament are to meet their responsibilities to employees, employers and act in the public interest.

I ask members to remember what I say now because in a moment I will read what the then premier and other members opposite said at that time about the so-called draconian changes the then Liberal government would introduce. On 1 December 1994, the Hon. Graham Ingerson said:

The benefit levels prescribed in the current South Australian workers compensation and rehabilitation scheme are the most generous of any scheme in Australia and at least equal to the highest statutory benefit levels in any Western economy.

We are hearing this again—sometimes it sounds like an echo chamber. He continued:

The consequence of those unaffordable benefits, paid in the context of a pension based no fault scheme, has been to reduce the incentive of rehabilitation and return to work and to guarantee uncompetitive levy rates. As an Industry Commission report has noted, high compensation payouts mean high workers compensation premiums.

I will continue to read from Graham Ingerson's contribution, and the point I make relates to the absolute hypocrisy of those opposite in what they said then and what they are doing now. The 'draconian measures' put in place by the then Liberal government in 1994 included:

The restructuring of worker benefits in this Bill has been designed in a manner which creates a fairer benefit scheme. Benefits for all workers for the first six months on the scheme remain at the maximum 100 per cent level.

We were going to cut it short, but at least we were giving workers time to get themselves organised—six months at 100 per cent. He continued:

For between 6 and 12 months those benefits will reduce to 85 per cent of pre-injury earnings.

That will be not 80 per cent as it is now, but 85 per cent. He continued:

After 12 months this bill proposes that benefits payable to long-term, seriously injured workers be increased from their current 80 per cent of pre-injury earnings to 85 per cent…In doing so the government has recognised the hardship accruing to seriously long term injured workers whose incapacity renders them unable to return to gainful employment. Benefit levels for less seriously injured workers beyond 12 months continue to be payable under the WorkCover scheme, but at a level which will be equated with federal social security payments.

What do we see now? At 2½ years we will just turf off people onto social security. Wait until you hear what the Premier and others who are still in this place said back in 1995. It is just a disgrace. Graham Ingerson continued, 'The state government has not proposed in this bill any direct cost transference to the federal social security system.' And the aim was to give a fair outcome for workers, business and the state generally.

This is what this state government is proposing today, in 2008. The plain fact is that this government will do to workers what it accused the Liberal government of doing in 1995, and I shall read that into Hansard in just a moment.

Since the 1995 changes there were also changes to the act in 1998, and on 9 February 2002 (what a sad day that was for this state!) we saw the Rann Labor government come into power. In May 2002, just a couple of months later, we saw the establishment of the Parliamentary Committee on Occupational Safety, Rehabilitation and Compensation, whose function was to keep the administration and operations of the Occupational Health, Safety and Welfare Act, the Workers Rehabilitation and Compensation Act, and other legislation affecting occupational health, safety or welfare or occupational rehabilitation or compensation, under constant review.

In December 2002 we saw the Stanley review released. The Brian Stanley, Francis Meredith and Rod Bishop review of workers compensation and occupational health and safety welfare systems was in three volumes. It is one of those reviews that have been compiled and looked at, but unfortunately very little has resulted from it. In 2003-04 the Parliamentary Committee on Occupational Safety, Rehabilitation and Compensation produced three reports regarding a review on the Statutes Amendment (WorkCover Governance Reform) Bill. That bill went nowhere. The next changes we saw were that in 2005 the Statutory Authorities Review Committee inquired into the WorkCover Corporation in South Australia and listed the 40th report, to which I will be referring later.

It is interesting to read the chronology of the funding positions of the scheme since the year 2000. Unfortunately, the SARC report goes only to the 2004 figures, and it will be very interesting to see what percentage figures WorkCover releases tomorrow and what the unfunded liability and the funding position will be.

There was also 2006, when WorkCover actually did a review into itself. That went nowhere. The government obviously did not like it reviewing itself, or did not agree with the recommendations, so in 2007 minister Wright announced a review into WorkCover to be conducted by two workers compensation experts, Alan Clayton and John Walsh. The review was due on 30 November 2007, but when did we see it? We saw it on 26 February 2008. And when did we see the legislation? About the same time. There was no consultation on the legislation and there was no wide public review of the legislation. What we have once again by this government is agreement by attrition and lack of consultation. It is an absolute disgrace.

I would just like to say that it is interesting to see how this government's position on Mr Walsh has changed. Some of the things that both the Treasurer and the minister said about Mr Walsh when he was reporting to the Liberal government were not complimentary in any way, shape or form, but now they seem to have changed their opinions.

I refer to 1995 and what the Premier (then leader of the opposition) said about the Liberals' attitude to workers compensation. I will quote from a news release dated 5 February 1995, which is headed, 'Liberals must recognise the human cost of their WorkCover cuts'. The Liberals must recognise them! Well, if Mike Rann has any shred of decency, he will look at the human cost of this legislation. The news release states:

State Opposition Leader Mike Rann says the Liberals must recognise the human toll of their draconian WorkCover bill which will be debated when parliament returns this week...Mr Rann today met with two injured workers and their families and heard first hand their concerns about having their income cut down to below pension level under the Liberals' radical plan.

Mr Rann spoke to Christine Francis, a child-care worker who injured herself saving a child from being crushed in a door. I wonder what Christine Francis thinks of this legislation today. Christine Francis did not go to work expecting to be severely injured. She damaged her hand and seriously injured her back when she went to work in August 1993. I would like to know what she thinks of this legislation. The news release continues:

She has had three operations on her hand as well as a spinal fusion.

How long would that take under the current medical arrangements in South Australia? I suspect not 13 weeks—I expect it would be a lot longer than that—yet someone like her would suffer under this legislation. The news release continues:

'Matt' is a husband and father of two. He was the family breadwinner as a truck driver and furniture removalist until he ruptured a disc in the spine in the course of his work. Mr Rann says the Liberals' WorkCover laws would force these people onto pensions, a situation that would see them lose their homes.

This is what Mr Rann said in his news release on 5 February 1995.

Neither Christine nor Matt want to be injured and they don't want to be on WorkCover.

What has changed? A lot has changed. This government thinks it can fix up its mess with this legislation so that people like Christine and Matt will be under stress and severe financial pain. It continues:

They want to be whole and working again. They are ordinary South Australians who were injured in the course of doing their work and deserve fair compensation under a system that will get them back to work.

This news release was aimed at Dean Brown, but one could change 'Brown' to 'Rann'. It continues:

There are better ways of attracting business than on the broken backs of workers.

That is what we are getting from this legislation. Mr Rann then itemised some of the things in the so-called draconian bill of the then Liberal government. It was going to cut income maintenance to the social security level after 12 months. Now, I do not think that was quite what was intended and certainly it was not the end result. The news release continues:

Presently under WorkCover injured workers receive 100 per cent of their average wage for 12 months and 80 per cent for the next 12 months. This bill will cut that to 85 per cent after six months.

What we are seeing here is 100 per cent for 13 weeks and then its being cut to 80 per cent—not 85 per cent—after 13 weeks. It is not after six months but, rather, 13 weeks. This bloke will say anything and do anything at the appropriate time to ensure he gets elected. He just cannot be trusted. He has betrayed the workers and the businesses of South Australia. They all need to re-examine this legislation; and I will be reading their submissions and their proposed amendments into Hansard on a later occasion. This Premier cannot be trusted. It is just a disgrace that the workers compensation scheme in South Australia has got to this position and that this is the government's solution to the mess.

Other interesting comments were made at the time by a former member of this place, Mr Ralph Clarke (then deputy leader of the opposition). Ralph Clarke said:

It is hard to imagine how anyone could draft a more vicious and uncaring piece of legislation than this.

I will repeat that: 'It is hard to imagine how anyone could draft a more vicious and uncaring piece of legislation than this.' One could say that about today's legislation. It is just a piece of legislation that is a quick fix to an absolutely terrible mess that has been brought about by the mismanagement of this minister and this government.

Let us go to the Hansard now. Let us see what Mike Rann said in the debate on the changes the Liberal government intended to bring in—this 'draconian bill' the Liberal government introduced back in 1995. On 7 February 1995, the Hon. M.D. Rann, leader of the opposition, said:

It represents an assault on the rights, dignity and lives of workers and their families.

The then leader further said:

...this is no reform; this is no fine-tuning of the system...this legislation has one fundamental purpose: it is designed to destroy a fair workers' compensation system in this state...The Liberals are not interested in the human side of WorkCover.

That was Mike Rann, the Premier who is leading the Labor Party in 2008. This is what he said in 1995. Well, how things have changed! I wonder what Matt and the other lady, Christine, would think of this legislation and what Mike Rann is saying today. Would they be standing by his side saying, 'This is good legislation'? On 7 February 1995, Mike Rann, leader of the opposition, mentioned Christine in his speech. He said:

Christine did not want to be injured; she does not want to remain injured; she wants to be whole and working again. It was not her fault that she was injured, but she told me and she told the media at the weekend that she would lose her house if this bill becomes law. That is not right; it is unjust; it is unfair; and it is unnecessary.

This government has got its own board, its own CEO and its own provider now, which was all going to reduce the unfunded liability by 2012 to 2014. It said that in 2006. If that was going to be the case, what has gone wrong? I know what has gone wrong, and we will be talking about that as we go through this legislation. Mike Rann continued on, and said:

The greater tragedy is that Christine is not alone. Hundreds—if not thousands—of injured workers and their families will be hurt. Thousands upon thousands will be affected adversely by this legislation. It is not enough that they are racked with pain; it is not enough that their injuries put their marriages and their family lives under intolerable strain, but now the Brown Liberal government [and one could now read in there 'the Rann government'] wants to take their homes and a decent income away from them...It seeks to enshrine in legislation a system that blames workers for their injuries and punishes them if those injuries do not heal.

How things have changed! Mr Rann continued, and this particular sentence, I think, is really quite condemning of what his position is now:

One just has to read through those contributions to see the sneering, patronising, offensive attitude towards injured workers.

He was saying this about the Liberal Party. If members opposite had the courage of their convictions and were not bullied, harassed and threatened with everything from not being preselected to just being ostracised then, perhaps, they would be standing up in this place and we would not be in any way lumping them in with the sneering, patronising and offensive attitude of this government to the injured workers of South Australia. Mr Rann continued on and talked about the Brown government, but you could now substitute 'Rann government'. Mr Rann said:

The Brown government says that it wants to protect the viability of our workers rehabilitation and compensation scheme; it says that it wants to preserve the benefits of a fair and equitable state-based rehabilitation and compensation scheme, but this legislation does not do that at all. Behind the rhetoric and behind the weasel words lies a proposal to cut significantly the income of most injured workers. The government claims that this will provide a greater incentive for workers to return to work; it says that this is a worthy social objective because it will protect workers from being 'pensioned for life on the WorkCover scheme'...

That is what Mike Rann said in 1995, and look what he is doing now. He further said:

If this logic were not so diabolical it would be laughable. Why and how does the government think that injured workers, whose benefits are cut, will be better able to get a job out there in the private or public sectors? What will really happen is that these workers and their families will have to manage on a social security level of pension, and they will live in poverty as a result. So much for the Liberals' [but it could now be Labor] so-called commitment to a no-fault workers' compensation scheme!

This is what Mike Rann said in 1995, 'It is an absolute disgrace.' He did not leave it there, but continued on and talked about fairness and justice. On 7 February 1995 he said:

There is a fundamental point about fairness and justice. Let us not be ashamed that our benefit levels are amongst the best in the country. Let us be proud that in South Australia we do not settle for the lowest common denominator when it comes to the care of injured workers. The government says—

and he was talking about the Brown Liberal government then—

that the current benefits are unaffordable. It says that so-called restructured benefits will save $80 million a year.

The restructured benefits here, according to what the minister said on FIVEaa, will save about $20 million a year. Mike Rann continued:

Yet, it also claims, when criticised, that the cuts it proposes will affect only a small proportion of claimants. The government's rhetoric simply does not add up.

That is the case here: the government's rhetoric simply does not add up. Mike Rann continues to focus on the notions of justice. I hope everyone out there who has been affected by the changes to this legislation listens to this.

Let us return to the notion of justice. The government proposes that payments may be stopped without notice when it is decided that the worker is fit to return to work. Too bad if that decision is wrong! I will talk later about the medical panels, which have been described by one lobby group as being akin to Stalin's star chamber. There is no right of appeal and absolutely nothing in it for the workers. There may be some merit in implementing medical panels, but not the way they will be used by this legislation. We had medical panels years ago, but how they will be used under this piece of legislation needs to be reviewed. Mike Rann continued:

The government's bill is not about preserving the integrity of our workers compensation system and it is not about fairness and equity. It is about forcing injured workers into a situation where they cannot afford to live as their job previously enabled them to live and expects them and their families to cope not only with the injury and financial hardship, but the notion perpetuated by this government and through this bill that it is somehow their fault.

That is what he was saying about the Liberals in 1995. This guy has now betrayed every Labor principle of protecting the individual and the workers out there. He has done absolutely nothing in the past six years to solve the mess we are faced with today. I hope that tomorrow we will see the full realm of the mess when the unfunded liability hits the big 'B'—the $1 billion figure. The Premier continued in 1995, as follows:

WorkCover cannot substantiate any savings from privatising claims management, except on the basis of an ideological assumption.

If that is the case, Mike, you have not gone to multiple claims agents such as those in New South Wales and Victoria on which the Clayton report models its recommendations: you have gone to a single claims agent. If you find it so bad, why have you done that? In 1995 you had a different picture. You wanted to insource it then, but you have an opportunity to change this legislation now: it is open, and it is up to you. This is the last bit I will talk about on Mike Rann's contribution back in 1995.

This is what Mike Rann said in 1995—and it did not apply to the Liberal Party then, because the cuts were nowhere near as draconian as they are now, but it certainly applies to this Labor government. 'This bill is an attack on families.' That is what Mike Rann said in 1995 and that is what I say today: this bill is an attack on families. Yet the government comes in here and tries to pretend, as we have heard the Deputy Premier come in here today and say, that this is good legislation. Read Hansard, because that is what the Deputy Premier said. Let us see what the Hon. Kevin Foley, the member for Hart (as he was then), said on 7 February 1995. He said:

...I have a different perspective on WorkCover than I have ever had before.

Ain't that the truth. His perspective on WorkCover has just changed completely. The Hon. Kevin Foley, now Deputy Premier, then member for Hart said:

I want to talk a little about the hypocrisy of this government.

He is referring to the Dean Brown Liberal government. Go out onto the front steps of Parliament House, Kevin Foley, and tell the workers who are complaining about this legislation that this is not hypocrisy: it is good legislation. Kevin Foley went on to say:

This government, this Premier, this minister and all the economic ministers, the Treasurer included, are always telling us how good they are about getting the state going.

They are telling us how good they are about getting the state going. We heard it today; we hear it all the time—the AAA rating. Who made the hard decisions to get that AAA rating back? The Liberal government. Who lost it? The Labor government. We know that is an indisputable fact—just read Standard and Poor's. Let us continue with what Kevin Foley said on 7 February 1995 about the then Brown Liberal government. It is completely applicable today. I do not think it was applicable then. He was unfairly slating the then Liberal government's changes. Kevin Foley said:

They bring into this place legislation such as that relating to WorkCover—the same matter they brought to this chamber six months ago and said, 'This is it: this is our change to WorkCover.'

What do we have today? The Deputy Premier, Kevin Foley, said, 'This is it.' He did not say those words, but that is what he meant. He said, 'This is good legislation.'

I am telling the Deputy Premier that this is it: this is your legislation. Interesting news—all will be revealed. I think that they have a heart on that side. It is not a big heart: it might be palpitating rather than actually beating. Let us see if we can get the defibrillator on it over the next few hours to see whether we can get a decent beating heart on that side. All will be revealed, but interesting developments from the other side. The thing is that this government has now realised that the good legislation about which the Deputy Premier spoke not so long ago in this place was not quite as good as he thought it was. We will see some changes now.

Let us revisit where he was in 1995, because certainly he is revisiting his position now and so is the government—and we will see that this afternoon. Let us see what he said in 1995. On 7 February 1995 Mr Foley said:

I find it the height of hypocrisy that the government dares to say to the people in the community who have suffered legitimate workplace injury that they have to pay for the economic revival of this state.

The opposition knows that one of the main concerns which has been put to this government by various economists and actuaries around the place is that, if the WorkCover unfunded liability continues to blow-out, it could put the AAA rating under threat. Woe betide anyone who gets in the way of the Treasurer and his AAA rating: they will be made mincemeat. We are seeing that this government certainly has very little heart for people who get in its way, including members of this place.

I will continue with what the now Deputy Premier and Treasurer said, but I point out that there was a slightly different balance in the house at that time. At that time the seats of Hanson, Elder, Reynell and Kaurna were held by the Liberal Party. This was after the 1993 changes. He said:

I can tell the members for Hanson, Elder, Reynell and Kaurna that, if they want a career in parliament beyond four years, they had better start making noises in their caucus. If they are fair dinkum representative members of parliament, they should be standing in their caucus—

Well, I say to the members for Mawson, Bright, Newland, Light, Morialta and Hartley that they had better start making noises in their caucus. They should be doing what the then deputy premier said to the members for Hanson, Elder, Reynell and Kaurna back in 1995. They had better start making noises in their caucus. If they are fair dinkum representative members of parliament, they should be standing up and speaking in their caucus. They might have done so.

I do not know, but I doubt it very much because certainly there has been nothing outside and, if they were fair dinkum representative members of parliament, I am sure we would know about it on this side; and the media would certainly know about it because over there there are one or two people who like to chat up the media. They accuse us sometimes of being a little bit loose-lipped, but let me tell members that some of the feedback we get from the media about the other side shows that the treachery is just atrocious. Mr Foley continued in 1995 by saying:

—and thumping this government for some of the most malicious legislation that any government has introduced.

But what do we see from the members for Mawson, Bright, Newland, Light, Morialta and Hartley? And I know there are others on the other side who are very concerned about this legislation, both in this house and in the other place. What do we find out? We hear nothing from them. I hope today's changes that I am hearing about are as real or effective as we would like them to be, and I implore them to make sure that those members (the members for Mawson, Bright, Newland, Light, Morialta and Hartley) do stand up in their caucus if these changes that we are hearing about are not sufficient. The member for Hart continued:

...at the end of the day, we on this side of the chamber will acknowledge that the care, the financial security and the well-being of members of the workforce who are injured are our paramount priority.

This is what Mr Foley said back then:

At the end of the day, we on this side of the chamber will acknowledge that the care, the financial security and the well-being of members of the workforce who are injured are our paramount priority.

We know what the Treasurer's paramount priority is today. We all know that. It is his AAA rating. That is not to say it is not important—it is vitally important for a prosperous state—but, do you do this, as Mike Rann said back in 1995, on the broken backs of workers? Mr Foley then said, and he was addressing this to the various members on the then government side who he accused of being oncers, 'I say, 'Stand up for once.' So I say to every backbencher on the government side, and some of its frontbenchers who I know are being torn apart by this piece of legislation, what the Deputy Premier (the then member for Hart) said on 7 February 1995, and that is: stand up for yourselves and have the guts. He said:

It is about time a few of you showed a bit of guts, took on this front bench and stood up for the people who voted for you. If nothing else, if you have no compassion, have some political brains.

Let me repeat that. This is what Kevin Foley said to our backbenchers, who he said were sitting silent, and I say this to all the backbenchers on the other side and all the people who have sat silent on this legislation and watched it go through the various parts of the machinery of the Labor Party:

It is about time a few of you showed a bit of guts, took on this front bench and stood up for the people who voted for you.

We saw 'Fix-It Pat' trotted out to do some heavying on this. He was a WorkCover lawyer. I was talking to some unionists over the weekend and I asked, 'How long was Pat Conlon a WorkCover lawyer?' One said, 'A couple of weeks,' and another one was a bit kinder and said, 'A couple of months.' I do not know, but that is what I have been told. It is a shame that the government has to bring in the heavies—

Mr VENNING: Madam Deputy Speaker, I rise on a point of order. The Attorney-General is continually trying to interject and prolonging the debate. He ought to provide a better example.

The DEPUTY SPEAKER: I ask all members to hear the speaker in silence.

Dr McFETRIDGE: The Attorney-General cannot escape being part of this frontbench on the Labor Party side, and I say to the backbenchers that it is about time a few of them showed a bit of guts, took on this frontbench and stood up for the people who voted for them.

Let me continue to cite what was said in this place a little over 12 months ago, on 29 March 2007. I suppose it is April Fools' Day today, but the sad part about it is that this legislation is no joke. Let us see what was said in this place by Premier Rann, the Hon. Patrick Conlon and also by the minister when they were talking about changes to WorkCover. The Premier said:

The independent review will consider proposals by the WorkCover Board together with alternatives to reform the scheme to make it fully funded, fair to workers and affordable to business. I believe that it can be both.

Certainly, if one asks the workers who are out the front of Parliament House, one will find that they do not believe it is fair to workers—and I understand that the government has had a slight change of heart there, but I am yet to see whether that is a bit of a fibrillation or a real change of pulse. The Premier also said on 29 March 2007:

Any changes to the scheme will be directed towards three objectives: injured workers should receive fair financial and other support...

It depends on what is meant by 'fair financial support'—whether they have enough money to pay the power bills and to buy some bread and milk, and whether they have enough to pay their mortgage payments, with interest rates rising, and with the possibility of further interest rate rises under the federal government. This government does not seem to be able to stop them, yet it got stuck into the former Liberal government for that. The fair financial outcome with respect to this legislation is not what the Premier Mike Rann said on 29 March. Workers should receive fair financial support.

In 1995, the then minister (Hon. Graham Ingerson) said that we had a fair compensation scheme. The Premier also said on 29 March:

I want to repeat today that this government is committed to maintaining the best and fairest workers compensation scheme in the nation.

Do not forget that in 2003 there was a new board, and we ended up with a new CEO, Mr Carter, after a hiatus of about 12 months, I think; then later we had a change from the multiple claims agent to the single claims agent. So, in the last couple of years we have had exactly what this government wanted. However, the mess continues to explode: the unfunded liability is burgeoning. The Premier continued in his speech on that day and said: 'I have absolute confidence in my minister.'

Well, how come Pat Conlon, the Minister for Transport, had to run out the other day and do some of the heavy lifting on this? Was that because he was a WorkCover lawyer? I would like to think that was the case, but I doubt it very much indeed. Fix-It Pat was sent out there to try to fix it. We have been tantalised with the news of some changes that we hope will be announced, not because of Patrick Conlon's work but I think because the back benchers of this government may have done something and, as we know, this government does respond to the media, and having a thousand workers out the front is not good media for Mike Rann.

The member for MacKillop, Mitch Williams, the former shadow minister for industrial relations, also made some interesting comments. I respect his input on this legislation and the comments he has made in the past and I thank him for his assistance. On 29 March 2007 in this place Mr Williams said:

The bubble has burst, and we have a minister whose incompetence has come to the surface.

Mr Williams then went on to say that, while we had achieved a 20 per cent fall in the injury rate in workplaces in South Australia over a five year period, we also had a growth rate in the workforce of 10 per cent. What have we seen? A blow-out in the unfunded liability. We are experiencing some of the best economic times this country has ever seen. We have record unemployment rates, but we are seeing a WorkCover scheme that is out of control.

I will talk about the history of the WorkCover scheme in a few moments, but what this government did to try to solve the problem was bring in Alan Clayton to carry out a complete review. After WorkCover, SARC and Stevens had each done a review, we had the Clayton review. I will refer to the review undertaken by Alan Clayton in a few moments, but I go back to some of the concerns that were being expressed about the Clayton review by SA Unions back in March 2007.

On 30 January, Nick Thredgold, the President of SA Unions, said on Adelaide radio that 'this minister is a man of his word and he has reassured the union movement there will be no cuts to benefits.' That is not the way the statement read on that day when the minister stood in this place and talked about some of the aims of the review of the proposed legislation.

The member for Elder cannot go completely unmentioned in my contribution. He does have some expertise, or experience, as a WorkCover lawyer. For how long I do not know, and I am happy to be corrected but—

The Hon. M.J. Atkinson interjecting:

Dr McFETRIDGE: I actually trust unionists not to lie to me. I get on very well with unionists, and when they tell me something, I do not assume straightaway that they are lying, as it appears someone opposite seems to think is the case.

On 29 March 2007, Patrick Conlon, when he was trying to shift the blame back to the Liberal opposition, said, 'How dishonest you people are with workers' rights.' How dishonest we are with workers rights? What is happening to the rights of workers now? We saw this government give the unions free rein to advertise on any government building or on any government equipment to campaign against John Howard's WorkChoices, but what happened when the PSA wanted to put an advert on the outside of a tram—which may or may not have been appropriate—that was going to have a significant impact against this WorkCover legislation? It was canned. That may have been a TransAdelaide decision, it quite possibly was, but my impression is that there may have been some other pressure applied to ensure that the adverts were only put in places where they would not be noticed.

In bringing in this piece of legislation, the government is doing a 180-degree turnaround—it is not a backflip; with a backflip you end up in the same place—on what its members were saying in 1995. It is interesting to see how this government, which has its roots in the union movement, has ignored the unions this time. We have heard what Janet Giles has had to say, and I will read some of that into Hansard a little later. This government has betrayed all of its principles, and this was well illustrated back in March 2007 by the member for Mitchell, Mr Kris Hanna.

I should preface these remarks by saying that I think it was in the mid-eighties that a document, 'Limbs, Lungs and Lives: Occupational Health and Safety Reform', was produced by Mike Rann. In it he discussed how workers compensation in South Australia was hardly new in 1978. Jack Wright (I understand the father of the current minister) established the Byrne committee, which was aimed at introducing workers compensation legislation that would be fair and equitable. As Mike Rann said in 'Limbs, Lungs and Lives' (page 24):

For workers [at the moment] coverage is pretty much a lottery.

I go back to what the member for Mitchell said about this in March 2007:

...the government has done practically nothing to implement the many recommendations to make the system more rational and fair as His Honour Judge Stanley recommended. What else did the government do? The Labor government also created a monopoly by allowing EML to be the sole claims agent and Minter Ellison to be the sole lawyers representing the employers through the claims agents.

This resulted in a significant dislocation in claims management. Neither of those firms was fully equipped to handle the large volume of WorkCover cases that then came their way. They had to employ a lot of new staff, there was a lot of inexperience and for a while we were back to the chaotic days of the 1980s when so many claims managers did not seem to know their business, and it became a lottery...

So, in 1984 Mike Rann was saying how it was a lottery but the legislation was going to make sure that at least you were able to win a minor prize, if not the major prize, in the lottery that is sometimes WorkCover. That is the whole problem with WorkCover: it should be more consistent. It should not be about winning a prize but about getting back to work.

Let us just see what exemplifies the fact that this government has really turned around on its own roots and introduced this legislation that will not fix the problem it has created over the last six years. The member for Mitchell said:

I am having a go at the Labor Party members who are copping these cuts to workers' benefits.

He continues:

I was going through the list of Labor Party members who have spent a lot of time advocating for injured workers...

The member continues on for a short period, then switches to naming various members of the government and illustrating some of their background, as follows:

I had just been referring to Pat Conlon (the member for Elder) when I was interrupted, and I was questioning why he built up the left faction in the ALP to develop a position where it had policy influence only to squander it on a move to cut workers' benefits.

I was going to refer to Michael Atkinson, the member for Croydon. He had a history in the Shop Distributive and Allied Employees [Union]...Michael Wright...a former advocate for the AWU...Jay Weatherill, the member for Cheltenham...his legal career acting for injured workers. Paul Caica, the member for Colton and the former secretary of the [United] Firefighters Union, has seen plenty of injured workers. He knows what it means for a guy who has had his arm badly burnt or chopped off in a bloody accident inside a burning house somewhere to have his wages cut by a quarter after three months when he has bills and a mortgage to pay. He knows what it means...John Rau, the member for Enfield, who in his career has acted for many injured workers.

Debate adjourned on motion of Hon. M.J. Wright.


[Sitting suspended from 13:00 to 14:00]


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