The number of injured workers covered under changes to controversial scheme

An average of 28 people a year would be covered under a compromise on the controversial workers’ compensation reforms, new figures show, as thousands with psychological injuries stand to lose access to long-term medical payments.

As the controversial legislation returns to parliament, the Herald can reveal that of the 11,649 claims lodged since 2013-14, only 54 workers reached the proposed whole of person impairment threshold (WPI) of 30 per cent that would be required to access long-term medical payments.

The severe curtailing of injured workers’ access to the scheme has been at the crux of a months-long debate over the government’s contentious effort to reform the scheme. WPI is a measurement of how much an injury has permanently reduced a person’s function.

NSW Treasurer Daniel Mookhey’s proposed reforms of the state’s workers’ compensation system remain in flux.Credit: Kate Geraghty

The government says the reforms are necessary to ensure the financial viability of a scheme that has suffered under soaring psychological injury claims.

The vote comes after five months of frustration for the government, which sought to legislate the reforms in June. During that debate, the upper house moved to examine the legislation in more depth, culminating in a scathing report in early November.

The core concern of MPs opposed to the reforms is the proposal to severely curtail access to the scheme. Under the original proposal, the entitlement threshold for weekly payments would be lifted from 21 per cent to 31 per cent. The ability to claim lump-sum damages from employers would more than double from 15 per cent.

There are more than 3700 injured workers with a WPI of 20 per cent or above.

Last Thursday, an eleventh-hour compromise that would lower the “whole of person impairment” (WPI) required for psychologically injured workers from 31 per cent to 29 per cent was proposed as a circuit breaker.

The state’s chief psychiatrist would also be tasked with devising a tool to determine “psychological impairment” within 18 months of the bill passing. The State Insurance Regulatory Authority (SIRA) has previously said that work considering “the appropriateness and effectiveness” of the tool has been under way for at least 18 months.

MPs who have requested a copy of SIRA’s review have so far been rebuffed, according to two sources speaking on the condition of anonymity to detail private discussions.

A ratchet clause in the compromise solution would result in the WPI cut-off increasing from 25 per cent in July next year to 29 per cent reached by 2029. Government data shows 338 of the 11,649 WPI claims since 2013-14 were assessed as being greater than 25 per cent, an average of 28 each year.

As the Greens and Liberals are expected to oppose the legislation, the government needs the backing of both Jeremy Buckingham and Taylor Martin. While Martin was among those who proposed the compromise, Buckingham’s vote remains “in flux”. The votes of Shooters, Fishers and Farmers MPs Rob Borsak and Mark Banasiak were unclear, according to MPs involved in negotiations. Banasiak was contacted for comment.

Those who had spoken to Mookhey said he appeared confident he would land his preferred position.

A report released by the Business Council of Australia on Tuesday intensified pressure on the Coalition to strike a deal with the government. It found NSW’s workers’ compensation premiums were the second-highest in Australia, following the Northern Territory.

Opposition treasury spokesman Damien Tudehope, one of the leading opponents of the government’s reforms, has faced calls to find a solution. Tudehope was contacted for comment.

Businesses have privately threatened withholding donations, while skittish MPs are nervous about being blamed for premium hikes during an election year.

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