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House of Assembly - Fifty-Second Parliament, Second Session (52-2)
2013-10-31 Daily Xml
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WORKCOVER

Mr WILLIAMS (MacKillop) (14:57): My question again is to the Deputy Premier. Can the minister explain to the house the government's various redemption policies within WorkCover over the last 12 years, with particular reference to the current policy of severely limiting redemptions, compared with the policy of 2011 of seeking to redeem as many claims as possible? It indeed led the then CEO of WorkCover to state:

EML did an appropriate strategy around the redemptions which actually dealt with a significant portion of the liability that existed.

The Hon. J.R. RAU (Enfield—Deputy Premier, Attorney-General, Minister for Planning, Minister for Industrial Relations, Minister for Business Services and Consumers) (14:58): Again, another excellent question, and a very good point. The first point I want to make is that I am not sure it is correct to characterise the redemption policies from time to time as necessarily the policies of the government, because ultimately it is the WorkCover board and the way they function which deals with that thing; but let me leave that to one side.

There are, as some members would know, and I am sure the member for MacKillop knows, basically two schools of thought out there in relation to workers compensation. One of them is to redeem people and get them off the system, and thereby you deal with the tail issue for the scheme. You pay an amount of money upfront, in exchange for which people terminate their relationship with the scheme; they leave the scheme, and you create a fall-off in the tail of the scheme.

There is another entirely different school of thought, which is not necessarily completely inconsistent, but it is another way of looking at the same problem. It is what I would call the 'redeem them and they will come' type school, which is: the more you start redeeming people the more people think it is in their interest to remain somehow unwell, so that they get to the point that eventually their unwellness is recognised by the scheme and the scheme then redeems them. So you actually reward illness behaviour, either deliberate or not deliberate illness behaviour. Either way, by making a reward for demonstrating entrenched sickness behaviour, some people become encouraged to remain in that entrenched position.

Those are two contending schools of thought. Over time they have battled for the heart and mind of WorkCover. The honourable member points to a point in time, back in 2011 or whenever it was, when we had a high watermark of the 'redeem them and get rid of the tail' thinking: 'Oh good, let's redeem everybody, the tail will disappear, and the world will be happy.' Then, there was a change in management and the new thinking came in. The new thinking was, 'No, redeeming is bad. You are just rewarding bad behaviour by paying them a big pot of money; don't redeem them.' That got to the point where nobody got redeemed. In fact, last year I think there were only two for the whole year.

In my opinion, the answer is, obviously, not either of those polar opinions. There are occasionally intelligent reasons for a redemption to be offered, and should be offered, but not to the extent where everybody who becomes ill has a reasonable expectation that, if they just stay ill, they will be redeemed, because that would be counterproductive to the whole scheme. That is the position in respect of that.

The charter responsibilities that the Premier and I signed off on recently made it clear to the corporation that, as far as we are concerned, where there is common sense to the scheme and it will not become an attractor of illness behaviour, rational redemption should occur.

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