[Greens-Media] MARK PARNELL MLC: WorkCover admin fee blowout

[Parnell]

Media release
Friday 14th November, 2008

WorkCover admin fee blowout

	
Greens MLC Mark Parnell has raised concerns in Parliament about a 26%
increase in fees paid to the WorkCover claims manager, despite the
failure to deliver a promised reduction in the Corporation's unfunded
liability. 

In 2006, WorkCover CEO Julia Davison, when announcing the appointment of
Employers Mutual Limited (EML) as WorkCover's sole outsourced claim
agent, promised the new arrangement would cut claims liability 'by up to
$100 million a year after only two years', and stated EML's remuneration
would be 'tightly linked' to 'reducing WorkCover's liabilities'.

In the Corporation's 2007/08 Annual Report, the cost of claims
management has increased from $25.1 million to $31.8 million in 12
months.  Yet, since EML became sole claims agent, WorkCover's unfunded
liability has increased by $600 million.  

"Outsourcing WorkCover's claims management is a failed experiment.
Admin costs have jumped by a quarter in just one year at the same time
as WorkCover's unfunded liability has ballooned.  All the heart-ache for
workers through the slashing of their benefits has come to nought," said
Greens MLC Mark Parnell, an outspoken critic of the Rann Government's
changes to WorkCover that passed Parliament in August this year. 

"Not only is WorkCover in a far worse financial position, the claims
agent who promised to slash admin fees has pocketed a 26% increase in
just one year.

"Rann's WorkCover priorities couldn't be any clearer: employers and the
private claims agent make windfall gains, while employees' benefits are
slashed and WorkCover's financial position sinks. The Rann Government
has punished injured workers, while allowing WorkCover's poor management
to lurch on with their poor performance.  

"Instead of outsourcing, WorkCover should take back claims management.  

"Ensuring a safe return to work for injured workers is a core WorkCover
function, not an add-on," he said.

 

	
For further comment contact Craig Wilkins on 0434 007 893

	
 


---------------------------------------------------------------------
"The information in this e-mail may be confidential and/or legally privileged. If you are not the intended recipient, access to it is unauthorised and any disclosure, copying, distribution or action taken or omitted to be taken in reliance on it is prohibited and may be unlawful."