Further premium's cut on the way for business as workcover returns to surplus

Published 30th October, 2013 in Economy

NSW Premier Barry O’Farrell and Minister for Finance and Services Andrew Constance announced a further reduction to WorkCover premiums while confirming the scheme is now back in the black for the first time since 2008.

It means 200,000 employers across 376 industries will benefit from an average premium rate reduction of five per cent – saving them more than $130 million a year.

Mr O’Farrell made the announcement at Aldridge Traffic Systems at Rhodes along with Mr Constance, Member for Drummoyne John Sidoti and Vice President of the NSW Business Chamber Tony Dormer.

“The NSW Government’s reforms are delivering a fairer system, with more generous payments being provided to severely injured workers and businesses receiving incentives to improve workplace safety,” he said.

“The premium cuts announced today are on top of an average 7.5 per cent rate cut that came in earlier this year for 167,000 employers.

“With these reductions combined, NSW businesses will receive an average 12.5 per cent rate reduction in the 2013 premium cycle, returning $330 million to help grow the economy.

“The NSW Government's action to fix the scheme means no employer will receive a rate increase in 2013.

“These reforms are great news for a business such as Aldridge Traffic Systems which will receive a further WorkCover premium rate reduction of 7.5 per cent.

“The NSW Government’s reforms are freeing up businesses to grow and are providing better support for injured workers to help them return safely to work sooner.

“Returning to work early and safely is good for recovery and helps workers regain financial independence sooner.

“Safe Work Australia has reported that in 2012/13, NSW’s return to work rate improved by three per cent to 88 per cent - making it higher than the national average of 86 per cent.

“This result is a key driver in WorkCover’s improved performance, with the scheme accumulating a $309 million surplus as of 30 June 2013.

“This is a great result for the workers and employers of NSW. There is now adequate funding to protect injured worker payments while rewarding employers for good safety performance.”

Small employers are continuing to benefit from incentives introduced in June including:

  • an Employer Safety Incentive (ESI) premium discount at each policy renewal
  • a Return to Work Incentive for employers who have an injury in the workplace. An employer can retain their ESI discount provided injured workers return to work within 13 weeks
  • an increased discount to five per cent for paying the premium in full by the due date.

The NSW Business Chamber estimated that without the NSW Government’s reforms to the WorkCover Scheme 12,600 jobs and job opportunities would be have been at risk.

“WorkCover’s improved financial performance proves that looking after people who are injured at work and lower premiums are not mutually exclusive,” Mr Dormer said.

“Apart from the reduced premiums, it is particularly pleasing there has been a reduction in the number of claims and the improvement in the return to work rate.

“NSW now has the best return to work rate in the country,” he said.

Published 30th October, 2013 in Economy