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House of Assembly - Fifty-First Parliament, Third Session (51-3)
2008-10-30 Daily Xml
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WORKCOVER CORPORATION ANNUAL REPORT

The Hon. P. CAICA (Colton—Minister for Industrial Relations, Minister for Employment, Training and Further Education, Minister for Science and Information Economy, Minister for Youth, Minister for Volunteers) (14:19): I seek leave to make a ministerial statement.

Leave granted.

The Hon. P. CAICA: Today I have tabled the final version of the WorkCover SA 2007-08 annual report. The 2007-08 results are the last that relate to its performance under the former legislation. As at 30 June 2008 WorkCover's unfunded liability increased to $984 million, compared with $911 million at 31 December 2007, after a loss of $140 million for 2007-08. The scheme was 60.8 per cent funded compared with 63.4 per cent at 31 December 2007. WorkCover collected more in levies this year and received fewer claims, and its claims performance improved. However, like other investors WorkCover was impacted by the global downturn in investment markets—which has contributed significantly to its loss in the past year.

While WorkCover has no direct exposure to investments in subprime mortgage debt, the extreme volatility in the day-to-day global investment markets is impacting negatively on all balanced portfolio investors. The extent of these negative impacts going forward will depend on the duration of the current investment market uncertainty, but the below average level of risk that WorkCover has maintained since the inception of the scheme continues to moderate these negative impacts on financial performance, to some extent.

Over its 20-year history, WorkCover has achieved an annual return of approximately 10 per cent, which is better than the appropriate benchmark return for this investment portfolio. Improvements noted in the report include: more positive results in long-term claims and front-end continuing claims; a continued reduction in the duration of disputes; and improved health outcomes for injured workers via partnerships with medical organisations. The government is looking forward to WorkCover maintaining these improvements, as well as improving its financial position.

The overwhelming focus of the government, however, is on WorkCover improving its return to work performance, an objective that is in the best interest of injured workers, employers and the scheme itself.

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