Workers compensation: an update
The most recent major reforms were enacted in 2001 when the Scheme had a deficit of over $2 billion. As outlined in a 2001 Briefing Paper, these reforms met strong opposition from unions and the legal profession.1
There was a substantial turnaround in the Scheme's finances by 2006 and this led to some increases in entitlements. However, since 2008 the Scheme's solvency has deteriorated and the latest actuarial report estimated a deficit of over $4 billion as at 31 December 2011.2 According to the report, this decline was partly due to external influences impacting on investment returns and partly due to an increase in compensation claims.
On 26 March 2012, the Premier, Barry O'Farrell, announced, in an address to the Business Council of Australia, that the Government would be initiating "a process to repair this broken system".