NEWS THAT MATTERS

Hundreds of thousands of small

businesses face massive premium hikes

If you own a business on the Central Coast, like thousands upon thousands of other businesses in NSW, you are likely to suffer a massive workcover premium hikes because of the Perrottet Government's 'jobs and benefits for mates' attitude.

Despite  dire warnings of a  financial crisis within iCare, Treasurer Matt Kean failed to apply the brakes, allowing more than a hundred of the agencies top executives to receive obscene pay increases.

22 November 2022

 

THE NSW Treasury secretly warned Treasurer Matt Kean and Minister for Finance Damian Tudehope in August that the finances of the state’s main workers compensation scheme are in a dreadful situation and have deteriorated to levels considered to be a ‘financial crisis.’

 

The Treasury goes on to warn that iCare’s is intending to hike premiums to the highest levels seen this century. More than 300,000 businesses will be hit with a 33% increase by July 2025 compared to 2021.

 

“Treasury assesses that it will be difficult for the Government ever to judge that such rises would be affordable for businesses.”

 

Yet despite this warning, neither the Treasurer nor the Finance Minister stopped iCare from giving more than a hundred of its top executives huge pay increases.

 

The Ministers stood by as iCare’s CEO got an additional $240,000 - making him the only NSW Government employee to earn more than $1 million - despite forcing frontline workers to accept real wage cuts.

 

NSW Shadow Treasurer Daniel Mookhey said the government was ‘engaged in a cover-up’ about the true state of iCare’s finances.

 

“Top ministers know that the state of iCare’s finances is catastrophic. This agency remains a basket case. But instead of fixing the problem, the government has engaged in a cover-up,” Mr Mookhey said.

 

“There is no way the 326,000 employers who pay for iCare can afford the massive increase in premiums about to hit them after the system fell apart on Mr Perrottet’s watch.”

 

The Treasury briefing note was handed to the NSW Legislative Council after Labor issued a ‘call for papers’ in October.

 

The document also confirms that:

 

  • The finances of iCare’s main workers compensation scheme ‘has materially worsened’ since Labor forced Dominic Perrottet to order an independent review into iCare in 2020 following scandal-after-scandal:

 

  • “The situation since the McDougall Review has worsened. First, actual performance in FY21 and FY2 was worse than forecast at the time.

 

  • iCare’s turnaround plan now depends on premium increases that ‘may not be achievable':

 

  • “icare now forecasts a large premium rise for FY24, with smaller ongoing increases thereafter…these premium increases are the main factor that improves the Nl's financial position… the forecast increases would result in premium levels not seen since the mid-2000s.

 

  • Treasury ‘has significant concerns about the current financial position’ of the state’s main workers compensation scheme:

 

  • “The funding position has fallen well below its target, will remain below target for the rest of the decade, with the target funding range only projected to be reached in FY31.”

 

NSW Shadow Treasurer, Daniel Mookhey, “If the government is re-elected, as night follows day, they will try to eject even more injured workers from the scheme. They will be forced to suffer for the mistakes made by Mr Perrottet.

 

“Mr Perrottet must take responsibility for this disaster. He should have stopped iCare from handing massive pay rises to its top executives. His government needs to start telling the truth about dire state of the workers compensation scheme.

 

"iCare provides workers compensation insurance to more than 326,000 businesses. It insures 3.6 million employees. The agency’s investment portfolio is worth $38 billion. The Premier created iCare in 2015. Until last year, it had only ever answered to him."

 

To rub more salt into the iCare wound, this notorious agency failed to index the weekly wage payments it paid to thousands of workers for an unknown number of years.

 

iCare was already under fire for underpaying NSW workers with deadly dust diseases up to $93 million. iCare’s previous CEO also had to resign when it emerged that the insurer failed to pay 53,000 workers up to $80 million worth of their entitlements.

 

Yet despite these failures iCare recently gave more than a hundred of its top executives huge pay increases.

 

NSW Shadow Treasurer Daniel Mookhey said that iCare deserves its' renown as one of “Australia’s most notorious wage thieves.”

 

“Asbestos victims, as well as tens-of-thousands of injured workers, have been denied millions because the government has let iCare get away with breaking the law,’ Mr Mookhey said.

 

“iCare is still free to write too many of their own rules. The government has not bothered to change even one law to stop these scandals from happening.

 

“iCare continues to spend more time playing down, and then covering up, their wrongdoing than they do avoiding them in the first place.”

 

It was Dominic Perrottet, when NSW State Treasurer, who set up iCare and who set the the path for the worker's compensation agency to feather the nest of executives instead of looking after workers.

 

Ironically, these same executives continually managed to hike their own pay at warp speed, while injured workers were repaid at a snail's pace. It will be years before iCare manages to repay underpaid injured workers and businesses will be expected to 'foot the bill' with massive premium increases.

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