Return to Work Bill

Committee Stage

In committee.

The Hon. I.K. HUNTER: I want to remind the chamber that in my closing remarks on this bill, I indicated there were a number of members who could not make a contribution at that stage. We would seek the indulgence of the chamber for them to do so now. Now is an appropriate time and I think we have agreement to do that.

The Hon. K.L. VINCENT: I thank the chamber for its indulgence. I will speak briefly today, giving Dignity for Disability's very reserved and trepidatious support for the Return to Work Bill 2014. I say very reserved support for a number of reasons. Dignity for Disability supports the premise of this bill, a WorkCover improvement project which I believe started in 2012, knowing that our current WorkCover system is certainly not working. Prior to my entering this place, this government's attempt at reform in this space has been an abject failure.

In the 2012-13 year, I understand that the cost of WorkCover was some $1.34 billion. The premium rate being charged to employers was 2.7 per cent, yet the real cost in terms of liability was more like 3.4 per cent, but this extraordinary cost to businesses, employers, taxpayers and many not-for-profits, as we saw on the front cover of yesterday's The Advertiser, has not resulted in injured workers receiving a good deal. So, Dignity for Disability does agree that we need significant reform of our WorkCover scheme.

I can think of no-one, whether it is an injured or unwell worker, a union, a doctor, a physiotherapist or other healthcare professional or other employers, for that matter, who has a happy tale to tell about their experience with WorkCover. For this reason, I think Return to Work is a good title and a worthy aim for this bill, this legislation, and we certainly want to see that aim become reality. My support for this bill is very reserved because I cannot agree with many of the features in it. I do not think the capping of the scheme is fair, as it currently stands.

I am also concerned that a number of features of our health and welfare sectors have not been dealt with at the same time as these reforms. For example, a number of people in the most difficult to manage WorkCover cases experience chronic pain. Chronic pain, of course, is a difficult health complaint to manage. There is an 18-month waiting period to see a chronic pain specialist in South Australia, and many people with chronic pain need access to Schedule 8 medications.

No-one can tell exactly how many people with chronic pain require access to Schedule 8 medications, and no-one can tell me how many people with chronic pain, also often caused by workplace accidents, will be impacted by the changes brought about through this potential legislation. This creates reservations for Dignity for Disability—very serious reservations at that.

I also agree with a number of the issues and questions the Hon. Ms Tammy Franks has raised in this place in her second reading, and I look forward to those matters being addressed by the minister in his or her remarks. I would also like to draw attention to the speech given by the Hon. Steph Key in the other place—a long-time and passionate advocate for workers—and some of the concerns that she has echoed. If she is worried, then Dignity for Disability again believe that we have reason to be as well. She has immense experience in this area.

I believe that some of the errors being made by the government with the CTP legislation are being made again here, sadly, denying claimants their rights. I reserve further judgment until some questions are answered. I am yet to have time to analyse the government amendments, and also the amendments filed today by my colleagues the Hon. Ms Tammy Franks and the Hon. Mr John Darley, so I do not believe that we can proceed further with this bill today, and I understand that that is the opinion of some of my parliamentary colleagues as well.

This bill, and its partner bill, the South Australian Employment Tribunal Bill, are lengthy complex pieces of legislation aiming to fix a very broken system. This chamber needs to be given time to consider very seriously and comprehensively the amendments and improvements needed to do this, so I would ask the government to allow the chamber of the council, crossbenchers in particular, some time and due process to analyse and assess the impacts of amendments.

The Hon. J.A. DARLEY: I rise to speak on the Return to Work Bill 2014, and I appreciate the chamber's indulgence in enabling me to do this during the committee stage of the debate. The bill seeks to repeal the existing scheme established by the Workers Rehabilitation and Compensation Act 1986 and replace it with a new scheme, the return-to-work scheme, aimed at supporting workers and employers where there is an injury.

Some of the key features of the new scheme include the following: 'injuries' covered by the scheme will be those that result in a physical injury arising out of or in the course of employment where the employment itself amounts to a significant contributing cause of the injury. For psychiatric injury claims, the employment must be the significant contributing cause and it cannot arise from any one or more exclusionary factors listed in the legislation.

There will also be a distinction between seriously-injured and non seriously-injured workers. Seriously-injured workers will be those with an assessed whole person impairment of 30 per cent or more and non seriously-injured workers will be those with an impairment between five per cent and 29 per cent. Only one assessment of a worker's whole person impairment will be able to be made in respect of impairment resulting from one or more injuries arising from the same trauma.

Seriously-injured workers will be able to pursue one of three options: they can choose to be supported with income maintenance payments until retirement age and receive lifetime care and support; they can choose to take a redemption in lieu of weekly payments until retirement; or they can choose to pursue common law damages for economic loss where their employer's negligence caused or contributed to the injury in addition to rights of action against third parties and also receive lifetime care and support.

If they are unsuccessful with a common law claim for negligence against their employer, they will still be entitled to income maintenance payments. Non seriously-injured workers, on the other hand, will receive income maintenance support for up to two years on a step-down basis, and medical expenses for a further year after their income support ceases.

Income maintenance will be provided at a notional rate of 100 per cent during the first year and at a reduced notional rate of 80 per cent during the second year. They will also be entitled to a lump sum payment for permanent impairment and an additional lump sum payment for economic loss, provided that in the first instance the injury is not associated with noise-induced hearing loss, and in both instances the whole person impairment is not less than 5 per cent and the injury is not associated with a psychiatric injury.

The restrictions that currently apply to redemptions will be removed, and where there is agreement between workers and employers redemptions will be able to be paid in place of weekly payments. That said, it is envisaged that redemptions will only be used in exceptional circumstances when recovery and return-to-work options have been exhausted. As already alluded to, if a seriously-injured worker elects to receive a redemption, he or she will be precluded from accessing common law damages.

The South Australian Employment Tribunal will be solely responsible for resolving disputes that arise under the new scheme, and the only matters that will be the subject of appeal to the Supreme Court will be those that involve questions of law. On the face of it, the changes seem fair and reasonable, but as we all know the devil is always in the detail. Make no mistake about it, in this instance the detail could have devastating implications for injured workers and their families.

For example, the government says it has conceded to calls to bring back entitlements to claims for common law damages, yet the provisions around common law claims are so restrictive as to render them futile. As some commentators have put it, it is Clayton's common law, nothing more, nothing less. The bill provides that, in assessing whether the 30 per cent threshold has been met, impairment resulting from physical injury is to be assessed separately from impairment resulting from psychiatric injury, and in assessing impairment resulting from physical or psychiatric injury no regard is to be had to impairment that results from consequential mental harm.

In assessing the degree of impairment resulting from physical injury, no regard is to be had to impairment that results from psychiatric injury or consequential mental harm, and the 30 per cent threshold is not met unless the degree of permanent impairment resulting from physical injury is at least 30 per cent, or the degree of a permanent impairment resulting from psychiatric injury is at least 30 per cent.

An injured worker is precluded from an entitlement to both a redemption and damages for future economic loss. The usual heads of damages for common law claims have also been restricted, so an injured worker will not be able to claim, for instance, for pain and suffering, past and future loss of earning capacity, voluntary services, care and maintenance, future medical treatment, gratuitous services and loss of superannuation.

I have always advocated for the return of common law rights, but this bill will not deliver. The bar has been set so high that it is going to be virtually impossible for injured workers to attain it. According to the Australian Lawyers Alliance, it is anticipated that the number of injured workers who would qualify would be as low as 1 or 2 per cent. There will be a number of injured workers who are currently on the WorkCover scheme who will be transitioned to the new scheme. Many of those workers will not meet the new 30 per cent impairment threshold that will apply to seriously-injured workers. As such, they will only be eligible for payments for a further two years; after that their entitlements will cease.

Rightly or wrongly, some of these workers have been left to rely on these payments and have probably structured their lives around them. It will come as very little surprise to me if we are left with a number of injured workers unable to meet their financial commitments as a result of the changes.

Moving on now to the feedback I have received on the bill. It stands to reason that the Law Society of South Australia and many members of the legal profession generally are opposed to the key elements. Specifically, concerns have been raised about compensability and restrictions around entry into the scheme, the unfairness of the 30 per cent whole person impairment, uncertainty in determining the start date of incapacity and the two-year cut-off for non seriously-injured workers, costs and the recovery costs for representation, the assessment method for permanent impairment, and issues involving medical expenses.

The Law Society is also critical of the one-month time limit that applies to reviewable decisions under clause 100 as this prevents access to justice, and the 30 per cent threshold for common law damages is also considered to be too high for there to be any sort of meaningful entitlement to damages.

Lastly, it is a concern that significant provisions in relation to the bill are dependent upon the contents of regulations which are yet to be provided. Many of these concerns have also been echoed by the Australian Lawyers Alliance. In particular, it is concerned that the changes to the test for compensability will significantly reduce the number of injured workers entitled to compensation and that the new changes to the test for compensability of medical expenses will have a double limiting effect on the ability to claim and is inconsistent with one of the overarching objectives of the act, namely to ensure that workers who suffer injuries at work receive high-quality service and are treated with dignity and supported financially.

With respect to the termination of medical expenses after 12 months, the ALA considers that the proposed changes are problematic and the current test should be retained and lifetime medical expenses with ability to redeem should also be retained. In terms of permanent impairments, the ALA also considers the requirement that only one claim may be made fails to recognise the medical reality that there are conditions that may worsen and there is no concession for this. The government's failure to provide the impairment assessment guidelines has also made it difficult to provide appropriate feedback. The ALA considers that the restriction on combining physical and psychological injuries only serves to continue the current discrimination against psychological injuries.

Although the guidelines have not been published, the ALA states that it is not inconceivable that in many instances the physical and psychological injury would not reach the 30 per cent threshold and that there would be many examples of, say, emergency workers who deal with trauma who would fall into this category. Overall the ALA says that the application of the strict threshold will have unfair, harsh and unjust consequences on injured workers who would be regarded as seriously injured but who do not meet the threshold and that the WPI is a blunt tool for an assessment of the worker's incapacity for work and treatment needs.

With respect to weekly payments, the ALA recommends that injured workers should be entitled to weekly payments of up to two years but if it is determined that a boundary should be placed around these payments, then it would be appropriate for the entitlement to have been taken within a five-year time frame from the date of incapacity.

Whilst the ALA supports the concept of lump sum payments, it also believes that the formula for these payments requires adjustment with respect to the worked hour, as the current proposal will discriminate against those workers such as parents raising children or school students who are engaged in part-time work but intend to work full-time in the future.

As alluded to earlier, in terms of common law claims, the ALA considers that the 30 per cent WPI results in restrictions are such that only 1 or 2 per cent of injured workers will be eligible to claim for common law damages. Its position is that if the government is genuine in its desire to reintroduce common law, then that threshold should be set at 10 per cent.

Lastly, there are also concerns over the introduction of additional restrictions to seek an extension of time on applications to review decisions, especially given that those more stringent requirements will disadvantage those of non-English speaking backgrounds, those suffering from poor understanding, literacy problems and those who are having difficulty dealing with matters as a result of their injuries.

Generally, the feedback appears to be that the legal profession will not be adversely impacted by this bill, so suggestions that personal injury lawyers, the ALA and the Law Society are speaking out against it purely out of self-interest seemed to be rather unwarranted and baseless. The fact that the Australian Medical Association has also highlighted a number of similar issues certainly supports this position.

Very briefly, these issues include concerns that the 30 per cent whole person impairment is an imperfect measure for major injuries, which will result in the need for further recognition of exceptional conditions. The 104-week prescribed period post injury is not long enough for some conditions, especially because some psychiatric injuries may not be fully exposed or stabilised within the two-year limitation requirement, and the absence of any payments of economic loss for hearing and psychiatric injury in relation to redemptions.

The AMA is also concerned about the corporation being able to determine who will be a recognised health practitioner, the insertion of additional tests in consideration for the payment of medical expenses and the scale of charges intended to be used. Above all, I think it is fair to say the AMA is particularly concerned about what it calls the continuation of the current discriminatory approach towards workers suffering psychiatric injury, which is further exacerbated by some of the new provisions being proposed under the bill. Following on from personal discussions that I have had, it would seem that these concerns are also shared by the Royal Australian and New Zealand College of Psychiatrists.

There have, of course, been those organisations that have contacted me in support of the bill. Most acknowledge that there are pitfalls in what is being proposed but support making compromises in the hope that it will result in a better outcome than what we have at present. I respect those views and accept that for some organisations it has become an issue of something has got to give to get our WorkCover system back on track and, importantly, to reduce the associated costs for employers. I think it is fair to say that Aged and Community Services and Leading Age Services Australia fall within the category of respondents.

One thing that has stood out like a sore thumb throughout this debate—and some of my colleagues in this place, including the Hon. Robert Brokenshire and the Hon. Tammy Franks, have highlighted the same point during their contributions—is the deafening silence of the unions. Given their conduct during the election, it would have been a fair assessment for me to think that I was the only one who had missed out on the usual barrage of requests for meetings that we receive when debating WorkCover legislation, but it seems that is not the case this time around.

I am glad it is not just me that finds their absence in this debate to be absolutely remarkable, especially given the magnitude of the changes that are being proposed for the workers they represent. In fact, it is extremely disappointing that union representatives appear to have been hushed into submission by the government. I acknowledge that there is no easy fix to this problem, and I am acutely aware that businesses can no longer afford to bear the brunt of a broken system. That said, I cannot accept that injured workers should become the scapegoats for a problem that was created by this government.

Most of us were here in 2008, urging the government in the strongest possible terms to implement real reform. Those pleas were ignored, and so we sat and watched the government move ahead with yet another failed approach at fixing a broken system. Last year, the Attorney came out and told us the system was buggered and he was going to fix it. With all due respect to the Attorney, fixing a broken system by adopting the measures in this bill is like trying to piece together a broken glass with a glue stick—it just does not gel.

Like the opposition, I am firmly of the view that instead of establishing a new tribunal we should also be trying to ensure that the return-to-work scheme move into the jurisdiction of the SACAT. I would ask the minister to provide an explanation as to why this cannot be achieved in the given time frame, and whether any changes to that time frame would make this a plausible outcome.

In closing, I foreshadow that I will be moving a series of amendments aimed at addressing some of those concerns that have been raised with me. From what I understand there will be some overlap with the amendments that are being proposed by the Hon. Tammy Franks, and I certainly commend her for taking on board the concerns of injured workers and pursuing this further. I hope that, despite what is anticipated this week in terms of the speedy passage of this bill, this chamber will lend itself to a considered and constructive debate.

The Hon. T.T. NGO: I rise to support this bill, and I thank honourable members for allowing me to speak to the second reading on clause 1. I do so not in ignorance of the repercussions that it will have for some South Australian families. Why do we need this reform? The Attorney-General has said that the WorkCover system is buggered.

The scheme is more expensive than any other state's; the return-to-work outcome for injured workers is worse than any other state's as well; the unfunded liability has ballooned out to $1.13 billion and the scheme is unsustainable; and, most importantly, both employers and injured workers are not very happy with the current system. The minister and the government should be congratulated for recognising that the current system is not working.

The Hon. R.I. Lucas: Twelve years!

The Hon. T.T. NGO: Twelve years—it is not very often that politicians accept that their policies have not worked. For so long, different ministers have tried to fix WorkCover by tinkering around the edges hoping that it would fix the problem. We all know the result of that: one of the worst schemes in the nation, as I outlined earlier. During the second reading the Hon. Tammy Franks used the example of a buggered knee and a buggered elbow to express her views on this bill. I would like to use one of my best friends (who also had a buggered knee) as a way to demonstrate why we need this reform.

My friend Young Yin injured his knee playing soccer five years ago. He needed a minor knee reconstruction to fix it up. However, he thought that going to the physio and rest would fix his knee so he rested for three years before taking on indoor soccer. In his very first game back my friend Young lasted 30 seconds. The knee buckled under the real game pressure. Because he ran a small Thai restaurant by himself—and I must say it was one of the best Thai restaurants in South Australia—

The Hon. R.I. Lucas: Where is it?

The Hon. T.T. NGO: It is closed now. He decided to rest his knee and, like last time, give it a rest and hopefully it would be fixed. A few months ago he felt such an incredible pain in that knee that he was unable to stand. The doctor told him that because he had kept deferring his knee reconstruction the injury got to the point where it was no longer able to carry his body weight and, instead of a minor knee operation, he required a full knee reconstruction immediately.

Obviously, it will take him a year to rehabilitate and all sorts of other things. He had no choice but to shut down his restaurant so that he could take at least a year off for rehab after the operation. He ran the restaurant by himself and his wife came home at night, after full-time work, to assist him. Because he was the main chef there and he had a buggered knee he was no longer able to do that. I am told that recently he had a successful knee reconstruction and walks about. He told me he regretted not making a tough decision a lot earlier.

Minister Rau ought to be congratulated for making a tough decision to start the scheme from scratch. By starting from scratch, we can focus resources and make the scheme solely focus on getting the injured workers back to work as soon as possible. If the injured workers are permanently injured, then they ought to be looked after for the rest of their life. That should be the number one focus. Obviously, the current WorkCover system does not seem to be doing that.

I must use this opportunity to congratulate the Leader of the Opposition (the member for Dunstan, Mr Steven Marshall), for his leadership in working with the government to have this bill passed and expedited in the other house. Obviously, the Leader of the Opposition and the Liberal Party recognise the benefits to both injured workers and their employers of having this Return to Work Bill pass and having it in operation as soon as possible.

This house should also thank the Hon. Rob Lucas for his part. I am told the Hon. Rob Lucas has the lead on this bill for the opposition in this house. Last week, when the ALP had its caucus gathering in Clare, I was sitting next to minister Rau at the dinner table and I was told the Hon. Rob Lucas has been fair, genuine and constructive in working with the government in support of this bill. The Hon. Rob Lucas should be congratulated for wanting to see the system working.

As honourable members are aware, in the Hon. Rob Lucas's second reading speech on this bill he gloated about how he raised his concerns in this house over many years regarding elements of the WorkCover system that are not working. I would not go as far as calling him a messiah, but maybe a grandfather who has a lot of life experience, and time has proven that the Hon. Rob Lucas was right about some of the issues that he spoke about over those years. We must praise him for his genuine leadership in wanting to fix the scheme.

We now have both the government and opposition working in a bipartisan way, for once, to have both injured workers and employers in a position to make the scheme work. I have every confidence that this proposed system, once up and running, will be better for many injured workers and employers. We are already seeing some signs that it has gone in the right direction, as shown by WorkCover's latest annual report. Since the system has put an emphasis on early intervention, it has delivered financial returns and more people have returned to work.

During the second reading debate, the Hons Rob Lucas, Tammy Franks, Rob Brokenshire and John Darley made some remarks about the lack of commentary by the union movement on this debate. I am by no means a spokesperson for the union movement nor am I a spokesperson for the SDA on this matter. However, I will say this: I do believe the SDA has a good track record in dealing with the business community and being open to reforms by promoting collaboration rather than antagonism. The results achieved by Mr Malinauskas and Business SA on the issue of penalty rates are a good example of this.

In my very first speech to this house, I said that during my time at the SDA I had never seen the SDA go out on strike. Very often, the SDA would work with employers to sort out issues behind the scenes. In my opinion, under the current WorkCover scheme workers are not being looked after. You only have to listen to talkback radio to hear criticism of the scheme from injured workers, how unfairly they have been treated and the lack of respect with which they have been treated.

When I was at the SDA I noticed that the WorkCover unit was the busiest area. The WorkCover officers would spend most of their time fixing problems for injured workers that they would not have had to do if the scheme were working. The SDA would be constantly taking employers to the commission to get things resolved; likewise, the employers would be doing the same.

I believe the unions have also realised that the current scheme is not helping their members, and that could be one of the reasons they have not objected to the proposed changes as furiously as previously. I know that minister Rau has consulted with them intensively, and they have put forward many amendments to this bill. The unions have shown their willingness for a system that would give their injured members every opportunity to return to work.

I know, from my previous job as an organiser at the SDA, that I would not like a system that is working well. A system that runs well would be less of an issue in the workplace and would make it really hard to recruit new members into the union. Some people do not want to join a union if they are happy in their workplace, and that would make recruiting for the union a lot harder. Therefore, the unions are putting their own interests aside to work with the government, employers and the opposition to, hopefully, improve the life of many working South Australians.

On the specific issue of advocating for workers rights within this bill that is being proposed, I say this: there is no point pretending that everything will be rosy for every single worker with this proposed legislation. Indeed, the minister has acknowledged this. I am well aware that changes to the scheme will hurt some workers, and of course that is of concern to me, but there is no silver bullet here. This parliament needs to move to ensure that we have a WorkCover scheme that will be sustainable for all workers for many years to come. Before I get into specific discussions on the bill, this is really the heart of the matter. We are here to make tough decisions and supporting this bill is one of them.

The current WorkCover system has been plagued with a number of issues and has let down our workers and employers. Employers have endured high premiums, as I said, while workers, many of whom want to return to work, have not received enough support to do so. This bill will introduce a new scheme that aims to strike a balance between workers, employers and the corporation. It focuses on workers returning to work rather than on what a worker cannot do. It will provide support, including retraining if necessary, for the worker to enter suitable employment.

Under the current system South Australia has a low threshold for an injury to be classified as a work injury, one of the lowest in Australia. It requires only that the injury be sustained during the course of employment. This bill will increase the threshold. For a physical injury to fall within the scheme not only must it be sustained during the course of employment, but the employment must be a significant cause of the injury. This threshold is the same as New South Wales, which has been interpreted by the Supreme Court to require a link between employment and the injury that is 'real and of substance'.

For a psychiatric entry to fall within the scheme it must arise out of employment and employment must be the significant cause. It also provides the same exception as the current legislation: that the injury does not arise wholly or predominantly from the reasonable actions of the employer, for example, not giving a promotion on reasonable grounds.

Currently, there is a distinction between primary injuries and secondary injuries for premiums. If an injury is classified as a secondary injury (for example, a worker's employment aggravates an existing injury from previous employment), then WorkCover bears the responsibility with no impact on the current employer's premium. This encourages employers to classify injuries as secondary to avoid their premiums being increased. In turn, the cost of secondary injuries is passed onto all businesses insured by WorkCover.

This bill seeks to eliminate that distinction. Employers will be responsible for the injury to the extent that the worker's employment by them was a significant cause of the injury. This will encourage employers to focus on safe working practices. It will put an end to all businesses footing the bill for the behaviour of some.

Return-to-work plans will be required earlier than before: within four weeks as opposed to 12 weeks (previously). These plans outline the steps that the worker and the employer will undertake to get the worker back to work as early as possible. There are also more clear obligations on employers to offer suitable employment to their injured workers. This requirement is also fair to employers, as they are required to appropriately pay the employee for the job they are performing and not what they were doing prior to the injury.

Changes to income maintenance also focus on workers returning to work. Income maintenance will now stop two years after the injury is sustained, unless the worker is seriously injured. It is here where I am completely aware that the scheme may not improve the outcomes for all workers but it is designed to ensure the sustainability of the scheme far into the future.

Workers who are seriously injured will no longer be expected to return to work. However, if they wish to they will receive support to do so. They will no longer have to undergo assessments every two years to continue to receive income maintenance. They will receive weekly income maintenance until retirement age (like some of our members of parliament here), unless they opt to receive a lump sum redemption or, if eligible, pursue common law damages. A medical practitioner who is accredited by the minister will assess whether a worker is seriously injured. The accreditation scheme will ensure that suitable medical practitioners receive accreditation.

Finally, I want to return to the issue of premiums. With the introduction of this new return-to-work scheme, the majority of small businesses should be paying lower premiums. It will aim to achieve an average premium of 2 per cent. Currently, the average premium is around 2.75 per cent. By removing the 7.5 per cent premium cap, businesses in low-risk industries will no longer subsidise businesses in high-risk industries. It will allow the industry premium base rate to accurately reflect the risk associated with each industry. It is estimated that these reforms will save $180 million per year, which will be passed onto businesses insured by the scheme.

I notice that in today's paper the opposition and the government are working through some of these points to maybe defer some of the high-risk industries for a few more years to, hopefully, give them some time to adapt.

As I said previously in my other speech, the government is willing to listen and negotiate with the opposition and, hopefully, we will get this scheme up and running very soon. Let me take this opportunity to also acknowledge the input that all members have made to this debate, and we can all be proud that we have made a contribution in rectifying this area of important public policy. I commend the bill to the house.

The Hon. I.K. HUNTER: I would like to put on the record some responses to questions that were asked during the second reading stages on the last day but have not yet been addressed. I note that a number of amendments have been tabled today, a couple in my name, a set in the name of the Hon. Mr Lucas, a set in the name of the Hon. Mr Darley, and a set in the name of the Hon. Ms Franks. I understand that there is no desire to proceed with this debate past clause 1 today, but I also understand that some further questions are to be put on the record, so perhaps we could do that at least when I have completed my answers.

The Hon. Tammy Franks spoke about a number of scenarios where workers will be denied access to surgery because the surgery would be required after their entitlement to medical expenses ceases. However, workers can apply to the corporation before their entitlement to medical expenses ceases for the cost of surgery undertaken at a future date to be covered.

The scenario the honourable member spoke about where a worker may have a work-related knee injury and foreseeably require knee reconstruction into the future is a good example of where these provisions will be used to enable the cost of the surgery to be met by the scheme. Additionally, workers are able to receive up to an additional 13 weeks supplementary income support if they are incapacitated because of this surgery to support their recovery at that time.

The Hon. Ms Franks also raised a concern about the provisions for a single assessment of a worker's degree of whole person impairment. In the scenario described by the honourable member, where a worker suffers a disc bulge as a result of a workplace injury, and then subsequently suffers a second disc bulge which is connected to the original trauma, the second disc bulge would be compensable if the worker's employment was a substantial contributing cause of the subsequent injury also. In such a case, the worker would be eligible for an assessment of whole person impairment for the second disc bulge, I am advised.

The Hon. Tammy Franks further questioned the requirement for an assessment of whole person impairment to be undertaken 'at a time determined by the corporation'. I can draw the honourable member's attention to the fact that this provision was the subject of a government amendment in the House of Assembly and has in fact been removed. The Hon. Ms Franks referred to comments made by the Law Society that the requirement that the tribunal only allow an extension of time if satisfied that good reason exists is potentially harsh.

I draw the honourable member's attention to the provision in the bill before the council which was the subject of a government amendment in the House of Assembly. This amendment was in response to comments made by the Law Society. Part of their concern was with a requirement for the tribunal to be satisfied that 'special circumstances exist'. It was for this reason that the test was amended to be that 'good reason exists' as this was considered to be a more reasonable test. In the context of aiming for a more expeditious dispute resolution system, it is appropriate that the tribunal have some parameters for when to accept or reject an application for an expedited decision.

The Hon. Tammy Franks indicated her intention to move amendments to ensure the reverse onus of proof provisions that apply to firefighters are equally available to CFS volunteers. The government has since announced its intention to reconcile this issue and will be moving amendments to the Return to Work Bill that include consequential amendments to the Workers Rehabilitation and Compensation Act 1986 such that our Country Fire Service firefighters can enjoy the same access to compensation as career firefighters. I know everyone in this place is keen to see this change and understands its importance.

The Hon. Mr Finnigan mentioned his concern that this bill creates 'two classes of injured workers', to use his words, those who are seriously injured and receive ongoing support and those who are not seriously injured. A fundamental change with the return-to-work scheme compared with the scheme we currently have is that it no longer pretends a one-size-fits-all approach is appropriate. The return-to-work scheme recognises that workers who are seriously injured need more support, financial assistance and case management than less seriously-injured workers who have the ability to recover their work capacity and return to work, and this should be seen as a positive change.

With regard to ensuring employers are afforded protection from any sudden premium increase as a result of some of the premium changes included in this bill, I would like to confirm that the WorkCover board chair, Ms Jane Yuile, has written to the Deputy Premier on 27 October and provided the following statement:

At its board meeting today the WorkCover Board resolved to provide for a five-year transitional period in respect of premium changes that could otherwise result in large and sudden increases in employers' premiums as a result of the removal of the industry cap or inclusion of secondary injuries within the workers compensation scheme, as proposed by the Return to Work Bill 2014 scheme, or as a result of any non-legislative improvements to the premium system.

With regard to consultation, I am advised that WorkCover will establish a stakeholder group, which will include key people in organisations that advocate on behalf of injured workers, and WorkCover will consult with this group on an ongoing basis. I invite other members of the chamber who wish to place further questions on the record for me to respond to early tomorrow or the following day to do so now.

The Hon. T.A. FRANKS: I place on notice for response a few questions, but also I reiterate my strong interest in seeing the actuarial report, the Finity report on the CFS cancer compensation presumptive laws issue. Having had such a debate before, where we have had to wait in this place for the previous Taylor Fry actuarial report on that very issue, I eagerly await seeing the most recent Finity report. My further questions are:

1. How many injured workers were retrenched from their pre-injury employment from 2011 to 2014?

2. How many applications were received from employers to terminate the employment of injured workers?

3. How many applications were approved by WorkCover?

4. How many applications were withdrawn following interventions by WorkCover or its claims agents?

5. How many applications were later rescinded where there was an improvement in the worker's capacity for employment or the employer's ability to provide suitable duties?

I look forward to the continuation and speedy response and the tabling of that actuarial report tomorrow.

The Hon. R.I. LUCAS: I rise to indicate from the Liberal Party's viewpoint our proposed course of action for debate on this bill this week. We accept the position from the minor parties and Independent members of the chamber that, with the final tabling of amendments this morning from all and sundry, proceeding with detailed discussion on those particular amendments today will not be possible. We note, as the Hon. Mr Darley indicated, that his amendments are significantly similar to the Hon. Ms Franks' amendments. The Hon. Mr Brokenshire's amendments have been on file for a while now and relate to a specific issue.

We acknowledge that it is probably the first time members would have seen the actual drafting of the amendments for the CFS cancer compensation from the government, although it had announced the details of the scheme, and I will address some comments to that in a moment.

From our viewpoint, we have indicated to the government that on behalf of Liberal members, and within the parameters the member for Dunstan has outlined right from the debate in the House of Assembly, we are broadly supportive of the reform to WorkCover. I outlined our position during the second reading, that we think this is a mess of the government's creating over 12 years. We have been cynical of the attempts that have been made in the past.

We hope this one is more successful, but only time will tell. Some of us have other views on what could or should have been done, but we do not intend to delay the committee stages with exploring those views. We are prepared to work with the government on their proposed changes and, as I said, we can only hope that this endeavour to fix the WorkCover scheme will be more successful than any of the others the government has attempted over the 12 years.

We have outlined to the minister and the government that from our viewpoint we are prepared to sit tomorrow morning, as we have just been advised, and tomorrow evening to pursue the detailed discussion of the amendments that have been tabled. We are also prepared to sit on Thursday morning and through Thursday in a genuine endeavour to see significant progress made or potentially even the passage of the bill through the Legislative Council.

We have not, as has been demonstrated by the Hansard record, engaged in delay or filibuster during this debate. I think that whilst I made an extensive contribution on behalf of all my colleagues, there has been precious little additional time taken up during the second reading. During the committee stage of the debate we will ask questions of the minister and the government in a number of particular areas, some of which have been canvassed already with the government, but we will not be seeking to delay.

We will be ready to go from 11 o'clock in the morning. Well, frankly, we are ready to go now but we understand the position of the minor parties and the Independents. I am anticipating that the government's position will be to oppose each and every one of the amendments moved by the Greens and the Hon. Mr Darley, but to be fair to the government and its advisers they would have only received the amendments from the Hon. Mr Darley and the Greens—

The Hon. T.A. Franks: Some of them made copies, so I imagine they might.

The Hon. R.I. LUCAS: I beg your pardon?

The Hon. T.A. Franks: Some of them have copies themselves.

The Hon. R.I. LUCAS: Well, then they will probably agree with those. We will be interested to receive them, and we have asked the minister and his advisers to indicate whether they will be supporting any of the amendments that have been tabled by the Hon. Mr Darley and the Greens. We have today circulated copies of those amendments to stakeholders seeking urgent responses from stakeholders before that continuation of debate at 11 o'clock tomorrow. We have had a quick response from a couple of employer groups but a number of others have not yet responded, and that is understandable in terms of the short turnaround time. For all those reasons, it makes sense to proceed as has been outlined by the minister and by other members as well.

I want to address some general comments at clause 1 because, whilst we will not be debating particular amendments, I think there are some issues that we can explore at clause 1 which will expedite passage of the bill during the actual clauses that are addressed. Some of these issues I have already raised with the government and its advisers. I seek when the minister responds tomorrow to be able to put formally on the record some of the information that has been provided to me as a result of questions I have asked since the last sitting of the parliament. One or two of the questions are actually new questions as well.

The first couple of points I want to make are in response to the minister's response to the second reading—and also I think to some comments made generally and reinforced by the Hon. Tung Ngo in his contribution at clause 1—and that is in relation to the lack of engagement from the union movement in South Australia. I addressed some comments during the second reading and I will not repeat those.

The only point I would make in response to what the Hon. Mr Ngo has put on the record is that if, as he indicates and the government has indicated, the unions are either happy with or prepared to support the position of the government in the interests of compromise and reform of WorkCover, it is entirely possible for the union representatives to actually express that view to members of parliament as well. They do not actually have to come in and say, 'Hey, we are opposing the bill. It is the worst thing that the Labor government has ever done.'

If they are actually adopting the position that is suggested by the government and some of its advisers that there are elements of the bill that have led to them to believe that they are prepared to support the legislation, then there would have been nothing wrong, in our view anyway, in them responding to the requests for comment from those of us who asked them for comment by saying, 'It ain't the best thing in the world, but we are prepared to accept it for these particular reasons.' It appears that all of us, or most of us, have been ignored from that viewpoint. We have requested comment and have received virtually nothing from unions. That is, I think, the point to be made in relation to the lack of engagement of unions on behalf of workers in South Australia.

The second point I make is in response to one of the issues that mainly the Hon. Mr Brokenshire raised, and about which I made some comments, in the second reading. It is an issue that I have addressed for four or five years and relates to former board member Sandra De Poi and the access of her companies to a significant degree of contracts over a long period of time with WorkCover. This is an issue that I have pursued for a number of years, I think going back to the Statutory Authorities Review Committee inquiry into WorkCover in about 2007, an issue that had been raised by many people in the rehab industry, the union movement and a number of other stakeholder groups as well.

I do not intend to go back over all the detail of that, other than to quickly record the extent of the contracts that Ms De Poi's companies enjoyed from WorkCover during that period, as recorded by the Auditor-General's Report: in 2007-08, total contracts to the value of $2.7 million; in 2008-09, total contracts of $3.1 million; in 2009-10, $5.9 million; in 2010-11, $8.4 million; in 2011-12, $8.6 million; and in 2012-13, $4.3 million; so a total over those years of around about $33 million worth of contracts.

The minister and the government's position all along—and the minister repeated it again, so I make no specific criticism there—says that the Auditor-General has recorded in a number of reports in the following terms; that is, WorkCover Corporation found that the terms and conditions of Ms De Poi's contracts were 'no more favourable than those available, or which might reasonably be expected to be available, on similar transactions to non-board member related entities on an arm's length basis'.

The point that I have made previously and I make again today is that that begs the real question, which is that the particular allegations that were being made were not that the details of the contract Ms De Poi was receiving were different but that it was through personal contacts and arrangements through the then claims manager or senior people in EML management that contracts were being awarded to Ms De Poi's companies to a much more significant degree than other providers, and that that was on the basis of connections that Ms De Poi's companies had with a senior manager within EML at that particular time.

The oft quoting of the Auditor-General's reports, as if that resolves all the issues, misses the significant point that those who complained about the arrangements at the time continue to complain about the arrangements made in relation to those particular contracts. I do not intend to pursue that issue now, but I just wanted to respond quickly to the indication on the public record that there was to be no further correspondence entered into in relation to that issue of Ms De Poi's access to a significant degree of contracts.

On other issues, the minister, on behalf of the government, has just read onto the public record two particular statements. The first one is on behalf of the WorkCover board, and that relates to the very significant issue of the removal of the industry caps. This has been raised in public debate, it has been raised in the second reading debate. The current bill proposes the removal of industry caps. As drafted, this bill would mean that a small number of employers in industries like the racing industry, meat processing industry, and some of the heavy metal industries as well, from 15 July next year would see a very significant increase in WorkCover premiums as a result of the instant removal of the industry cap.

Some of those increases, we are told, would be so significant that a number of employers may well have their future existence threatened; that is, they may well go out of business in a short space of time, given the significant size of the WorkCover premium increase. Credit goes to a whole range of people, particularly a number of the employer organisations (Business SA, the Australian Industry Group, and a whole range of others as well), which have engaged in fruitful discussions with the government and WorkCover on this issue. We raised the issue in the second reading and indicated that we were contemplating amending the bill to provide for a compulsory transition period of five years, or up to five years, for the removal of the industry cap unless the government could indicate, together with and on behalf of the WorkCover Corporation, the implementation of such a policy.

What we have heard this afternoon from the minister in this chamber is the announcement of a policy decision from the WorkCover Corporation, which will mean that the minister for WorkCover will not have to issue a ministerial direction to the board, which, I think, if push came to shove, he may well have been prepared to contemplate, but would have preferred not to. The board has made a sensible decision. I do not have the exact words—I heard what the minister was reading out, but I will have a look at it overnight—but my recollection of the words is to, in essence, implement a five-year transition period for the removal of the industry cap, which will mean that those industries over a period of time will have to prepare themselves for the eventuality that they will have to significantly reform their work performance and their activities or else they are going to have to financially prepare themselves for a very significantly increased WorkCover premium rate, potentially, over that five-year period.

Given that a significant number of these employers would appear to be, potentially, in regional areas as well (meat processing is certainly likely to be concentrated in regional areas, the racing industry will obviously be both regional and metropolitan), it will be important for those industry sectors and employers in those industry sectors—and we have been told the estimate is about 99 employers who might be impacted—to begin to prepare for change over that five-year period. The Liberal Party, on the basis of that undertaking from the WorkCover Corporation, will not be moving amendments in that particular area.

The next area that I want to address is the issue of SACAT and the employment tribunal. I will address some comments to this in the Employment Tribunal Bill, as well. In summary, as we outlined in the second reading stage, the Liberal Party parliamentary party room had a very strong view, and some significant people within the parliamentary party room had a very strong view that we could not and should not support the transfer of the jurisdiction from the Workers Compensation Tribunal to the employment tribunal; and that particularly in a climate where the government was getting rid of 100 plus boards and committees, why would the government be not taking the opportunity to transfer the jurisdiction to SACAT?

It is fair to say that the government's position has been to strongly oppose that. We have had amendments drafted along those lines. We had further consultation and we also met with Judge Parker from SACAT in relation to the issue of the practicality of a start-up date from July of next year. Without, at this stage, placing on the record all of the details of those discussions—because they can come perhaps in the detailed section of the clauses in the Employment Tribunal Bill as well—the Liberal Party room has adopted what we believe is a compromise position in relation to this transfer, recognising the argument that the minister has put publicly, that it was just impossible to achieve this by July 2015; that it might have been possible in the medium term to transfer responsibility; and that is broadly the same position that Judge Parker put on behalf of SACAT, whilst recognising ultimately that it is up to the parliament to decide what it wishes to do. However, when asked for advice that was the general nature of the advice that he provided.

On that basis, we have tabled amendments today which we ask the crossbenchers and other members in this chamber, including the government, to consider as a genuine endeavour to compromise from our original position of an immediate transfer. This will be a transfer recognising that it cannot occur straightaway but not until July 2018, a period of 3¾ years almost from today—a transfer period. That is generally the time frame that Judge Parker and a number of others, who are familiar with the jurisdiction, have indicated would be a reasonable period to allow SACAT to do all the other things that it is being asked to do, and then be ready to accept responsibility for this particular part of this particular bill.

We will debate that and we have tabled those particular amendments. I think there are seven or eight pages of amendments, but just for the benefit of crossbench members, all of the amendments, with the exception of one, relate to that simple policy issue—that is, transferring responsibility 3½ or 3¾ years down the track to SACAT.

The only other policy issue that we canvass in our amendments is a simple one, I think in relation to clause 137 of the bill or around about there, where the current bill requires the WorkCover board, if it cannot meet the 2 per cent average premium target in any particular year—if the GFC has just descended again on the world economy or whatever and the WorkCover board makes a decision that it cannot meet a target of 2 per cent average premium or less, in those circumstances it has to provide a report to the minister indicating why it has not been able to meet that legislated target, and also to indicate how it sees the potential for meeting the target in the following year.

Our simple amendment is that that particular report from the WorkCover board to the minister should be tabled in parliament within six sitting days. In my discussions with the minister he has indicated that it is likely that the government would be prepared to support that particular amendment so it may well be that it is not an issue of dispute between the government and the Liberal Party on that amendment. For the benefit of crossbench members, they are the only two policy issues at this stage that the Liberal Party has canvassed by way of amendment.

I indicated earlier that we had canvassed the possibility of an amendment in relation to a transition period for the removal of industry caps. The other area where we had been consulting about potential amendments but have decided not to proceed is in relation to a particular lobby that group training organisations, through Group Training Australia, had raised through my hardworking colleague the member for Unley, as the shadow minister responsible for this area. The Liberal Party had amendments drafted. We consulted on those with a significant number of employer groups and, suffice to say, in the end, there were a number of reasons why employer groups argued against the Liberal Party proceeding with these amendments.

The more significant arguments that were put to the Liberal Party were, first, to address what Group Training Australia argued was the issue where host employers are not really the employers of the apprentice or the trainee: the group training organisation is. If an apprentice is injured working with a host employer, the apprentice can sue the host employer for negligence and, whilst the injured apprentice might have received, say, $50,000 in medical expenses and income maintenance from WorkCover, if the injured apprentice is then successful in legal action in suing the host employer and gets a payment of $200,000, under the current act WorkCover recovers its $50,000 from the payment and the injured apprentice gets the $150,000 difference.

Group training organisations were arguing that this was impacting on host employers—their access to public liability insurance and the premiums that they might have to pay for that, and there were a lot of related issues that I will not go into that they raised with the member for Unley and the Liberal Party.

As I said, we explored those issues in great detail but virtually all of the other employer groups came back and said, 'If you are going to make changes to the benefit of group training organisations here in relation to the particular legal position of having host employers, you will have to do exactly the same thing with other industry sectors such as the labour hire industry and the construction industry.'

For those reasons, we certainly did not propose to go down that particular path. We have given an overall commitment not to move amendments or make changes to the bill which will make it harder to achieve the 2 per cent or less average premium target and to remove the $1.1 billion unfunded liability; and these particular amendments, if we were to pursue them, and their flow-on implications, potentially might have impacted in that particular area.

The government and WorkCover also—and we thank them for the detail that they provided us—did indicate that the scheme already provides significant financial subsidies and support to group training organisations to encourage them to employ apprentices and trainees, and did indicate that the equivalent to WorkCover in virtually all other jurisdictions did have the power to recover costs in the sort of circumstances that were being canvassed. For those reasons, and for others, whilst we have consulted with the business groups, and some members might become aware that draft amendments had been circulated, the Liberal Party has decided that it will not be proceeding with those amendments.

The Hon. R.L. Brokenshire: You will or you won't?

The Hon. R.I. LUCAS: We will not be proceeding. So, for the benefit of the Hon. Mr Brokenshire, we are addressing only two policy issues in our amendments (and I think I have indicated that in an email to the Hon. Mr Brokenshire): the issue of SACAT and the issue of the tabling of reports—

The Hon. R.L. Brokenshire interjecting:

The Hon. R.I. LUCAS: On a delayed basis to July 2018. I am happy to speak to the Hon. Mr Brokenshire on that issue after my contribution.

The Hon. R.L. Brokenshire: That's a long way away.

The Hon. R.I. LUCAS: It is indeed, but it is for the reasons I have already outlined (I will not repeat them). However, I am happy to have a discussion with the Hon. Mr Brokenshire after my contribution. The other area I should address is that the minister made another statement on behalf of the government and WorkCover today. I will perhaps leave the detailed discussion on this issue to the amendments the Hon. Mr Brokenshire has moved, but in the second reading explanation I did raise the issue of groups that worked on behalf of supporting injured workers.

I also raised the issue that what used to occur, back a number of years ago, was a regular stakeholder forum where groups like that—and others, union representatives and others—were able to meet on a regular basis with WorkCover management to raise issues or concerns they might have about the general operations of WorkCover. It also provided the opportunity for WorkCover management to outline to those groups—unions, and those who advocate on behalf of injured workers—major changes, policy directional changes, that WorkCover might be implementing or particular issues that were confronting WorkCover at any particular point in time.

In our discussions with the government and WorkCover we sought some commitment from the government to, in essence, reinstitute that. Whilst I do not have conveniently in front of me the precise form of that, the minister has today put on the public record a commitment to the reinstitution of a stakeholder forum which will incorporate those who advocate on behalf of injured workers and allow them an opportunity to put a point of view. When we get to the debate on that particular issue I know the value of that will become apparent.

I know a number of letters have just recently been sent to minister Rau from one of those groups, letters dated on 12 and 13 October sent from Work Injured Resource Connection Incorporated, raising a series of questions about this bill and the new scheme, and the impact on injured workers. The letter of 12 October, for example, talks about seeking clarification in regard to the transition of injured workers from the current scheme to the new process. It states:

My reason for writing is the large number of injured workers who have been contacting me in regard to what they are being told by the claims agent in that as of midnight June 30^th 2015 if the injured worker is over 130 weeks their compensable claim will cease. There is a massive amount of confusion in regard to what the process will be.

Clearly, when there is major change there is concern, particularly among groups of injured workers, their families and friends, and I think these sorts of issues can be handled through a forum like this where, on a regular basis, issues can be raised.

It might mean that the minister of the day does not get quite as many letters from people advocating on behalf of injured workers if management at WorkCover, on a regular basis, is meeting with those who do have questions. They can raise issues and, hopefully, management can raise with these groups (unions and those who advocate on behalf of injured workers) and say, 'Okay, this is the change we're implementing. We're going to have a new rating system,' or, 'We're going to be paying rehab providers under a new contract,' or whatever it might happen to be.

That forum will give the opportunity for both information and education to be provided to some in these particular stakeholder groups and equally, as I said, for them to be able to raise questions and hopefully head off some of the misinformation that eddies around any major change that goes on. We can address the detail of that in the particular amendment the Hon. Mr Brokenshire is moving. I did indicate that we were seeking a commitment along those lines and we welcome the announcement from the government today.

I need to place on the record now that the Liberal Party in the House of Assembly did indicate that it would not oppose the three new sets of government amendments moved to the original bill on the basis that we had not had an opportunity to consult with industry and we would reserve our position in the Legislative Council. I place on the record now that we have advised the government that industry groups have indicated their support for those original three sets of amendments which are incorporated in the bill we have before us now, and we will be supporting those aspects of the bill that are currently before us.

In relation to the three new sets of amendments the government is now tabling, I think since the introduction of the bill in the House of Assembly there have been six separate sets of amendments moved by the government to its own legislation. In relation to the three most recent sets of amendments, thus far the response we have had from employer groups is—and if I can separate out the CFS cancer compensation for the moment; the other two sets—to support them. So, the Liberal Party's position is to support them.

We have had no opposition from unions or anyone else to those particular amendments either; we have had no opposition from anyone to those amendments at this stage. Subject to not receiving any strong opposition from any groups before we can recommence the debate at 11am tomorrow, our intention will be to support those two further sets of amendments the government has made to the bill in the Legislative Council.

The sixth and final set of amendments are the CFS cancer compensation amendments, which have been tabled as well. My colleague, Dr Duncan McFetridge, has contacted the CFS volunteers in relation to these amendments. They have indicated to him, and to the Liberal Party, that they support the government amendments and would like the Liberal Party to support their inclusion into the bill. There was an alternative that the government could have introduced separate legislation, which would mean a slightly longer delay before that could have been introduced and passed through both houses of parliament. The Liberal Party's position, on the basis of the advice we have received from the CFS volunteers, is to support the CFS cancer compensation clauses.

I do put a question to the government, however, and it is similar to questions the Hon. Tammy Franks has put; that is, that the costs of this particular package are significantly less than what the claimed costs of the package were to be that the Liberal Party and others canvassed prior to the state election. We are interested in seeing on the public record a response from the government to the actuarial advice it has received as to what particular aspects of the scheme have resulted in the significant reductions in the estimated total annual cost of the CFS cancer compensation. So I flag, together with the Hon. Tammy Franks, our wish to explore that during those particular clauses, and we would hope the government would be ready when we debate that tomorrow potentially to answer questions in relation to specifically what aspects of the new arrangements have led to the significant reduction in the estimated cost of the scheme.

An issue I have raised privately with the government, and I wish the response to be placed on the public record, is the removal of the position of the WorkCover Ombudsman. My questions to the minister and to the government are: given the removal of this position, what was the current contractual arrangement with the WorkCover Ombudsman; that is, was he on a five-year contract and, if he was, how much of that period was left to run, and what are the termination arrangements in relation to the current incumbent for the position if this bill passes?

My understanding from the discussions with the government is that if the bill passes, the only payment the WorkCover Ombudsman will receive will be any accrued long service leave and untaken recreation leave, but I want to see on the public record the government's response to that particular question. I also ask whether, given if the bill is passed that position disappears, has any alternative offer been made to the current incumbent? Does he have a long-term position within the state public sector within any government department or agency once this position is abolished and, if he does not have a long-term position to return to, has the government made any offer to him of alternative employment with any government department or agency once the bill has passed?

The other issue that I want to place on the public record, and I will seek some answers, is in relation to the issue of claims management contracts. This is an issue that has had a long history as well. The Liberal Party's position dating back to 2006-07 when the government installed a monopoly claims manager, was to oppose that particular position and support a position of competition in terms of claims management. We were critical at the time of the very big increase—and I think I made comment in the second reading so I will not repeat it—in claims management costs which jumped from $25 million in 2007 to $48.9 million in 2009.

The Auditor-General's figures, as I read them since that big jump to $48.9 million in 2009, have shown that in the following year, 2010, it was $44 million and then in 2011 it dropped to $31 million. In 2012 it jumped to $42 million; in 2013 it jumped to $44 million; and in 2014, the most recent year, it actually jumped to $65 million in claims management fees being paid to EML and Gallagher Bassett. So the total claims management fees in the space of seven years have jumped from $25 million to $65 million. That is a very significant increase, and I seek a response from the government and from WorkCover as to the reasons for the $21 million increase in claims management fees from one year to the next, from 2013 to 2014.

That is an increase of almost 50 per cent in one year in the claims management fees. Under the new scheme it would appear that there should be a significant reduction in claims management fees, because under the new arrangements there will be much less required of claims managers. I seek a response from the government and from WorkCover as to what they believe will happen to claims management fees should this bill pass.

I guess the first issue I ask is: what is the estimate for claims management fees for this year, 2014-15, because that will all occur under the current legislation? It will not be until 2015-16 that we will see the impact of the new legislation. Are the government and WorkCover anticipating total claims management fees in 2014-15 around the $65 million that was paid in 2013-14 and, if so, why is that the case? I then assume that the government and WorkCover will be seeing, potentially, a significant reduction in claims management fees under the new scheme. Each year the Auditor-General will report on this, so we will have a chance to monitor it.

I also ask whether WorkCover has commenced discussions or negotiations with claims managers about the arrangements to be entered into for 2015-16. My understanding is that they have commenced. I also understand from discussions I have had thus far with WorkCover representatives that there will be some things that WorkCover will not be able to put on the public record as a result of commercial confidentiality. I recognise that that is the case, but I think that the parliament should be able to ask these questions and we should be able to receive some general information from the government and from WorkCover about the expectations for claims management and whether or not there are discussions about claims managers taking on other roles in relation to workers compensation management.

I put those questions to the government and minister today and would like to explore them during the appropriate stages later in committee. That is a general indication of the Liberal Party's approach to the committee stages of the debate. By raising a number of those issues at clause 1, given that we are about to report progress, I assume, from our viewpoint that will mean that in a number of those cases we will not need to address them in any great detail on the specific clauses later in the debate, and we hope that will help expedite the committee stages of the debate tomorrow and Thursday.

The Hon. I.K. HUNTER: I thank honourable members for their contributions and cooperation during the debate. Given that we will address this issue again tomorrow, I suggest that we report progress.

Progress reported; committee to sit again.