Inquiry to delay NSW workers’ compensation changes

The NSW Coalition has challenged Chris Minns to cut his workers’ compensation policy in half after successfully sending it to an inquiry.

NSW Opposition Leader Mark Speakman. Picture: NewsWire / Gaye Gerard

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NSW Labor’s hard-fought workers’ compensation policy has been delayed indefinitely and sent to an inquiry, with the Coalition challenging Premier Chris Minns to tear his bill in half and pocket what savings he can in the short-term.

The Minns government sparked the ire of unions, the Greens, Coalition and segments of its own backbench when it pushed a controversial but fiscally critical workers’ compensation bill that raised the threshold for psychologically injured workers to access compensation and receive ongoing support.

Under the proposal, the whole-person impairment (WPI) threshold for mental injuries would rise from 21 per cent now, to 25 per cent in ­October, and 31 per cent by mid-2026.

Those below the new threshold would be cut from weekly income support after 2½ years.

The opposition on Tuesday said it could not support any rise above 21 per cent, instead promoting six amendments which Mr Minns said would still cost taxpayers $1.9bn over four years.

As the bill reached the upper house on Thursday, opposition Treasury spokesman Damien Tudehope proposed it be sent to an inquiry until August 15. After amendment by independent MLC Mark Latham, it was decided the inquiry would run indefinitely though with a view to speeding up its return time.

The vote passed with the support of the Greens and crossbenchers, leaving the legislation’s future uncertain.

NSW Opposition Leader Mark Speakman challenged Labor to split its bill in half, passing its main components now while saving the controversial WPI threshold changes for a later date.

He said he would seek to recall parliament in order to push the bill through sooner if Labor could come to compromise.

“Those savings that could have been achieved today represent the majority of the savings the government identified in its own calculations,” Mr Speakman said.

“What do we say to the business lobby? Get on the phone to the government and tell the government to pass amended legislation and we can sort WPI out later.

“This problem, falls at the feet of Chris Minns and Daniel Mookhey. They could have sorted this out six months, 12 months, 18 months ago, but instead, they leave it to the heel of the heart.”

Mr Tudehope on Thursday remarked that he and NSW Treasurer Daniel Mookhey had “swapped friends”, as business groups turned on him.

NSW opposition Treasury spokesman Damien Tudehope. Picture: NewsWire / Nikki Short

“This is an issue which seems to have developed a life of its own. The Treasurer and I seem to have swapped friends,” he said.

“This is an inquiry which we should have had. This could have been started last October ... A long inquiry time followed by the introduction of legislation would not have been met with this amount of fire and brimstone within the public sphere.”

Delay was near-inevitable after the Minns government made it clear it would not compromise on changing the WPI threshold.

The average cost of psychological injury claims has nearly doubled in five years to almost $300,000 and all businesses, including those that do not have a claim in the system, face a 36 per cent hike in workers’ compensation premiums over three years.

Mr Tudehope, in a press conference after the vote, said the bill was dividing the Minns government within its ranks.

“I’m not sure that all of Labor are on the same side as the business lobby,” he said.

“I think there are many who sit on the backbench of the Labor Party who are shaking their heads that they have a Treasurer who has gone down this road.”

NSW Treasurer Daniel Mookhey. Photo: NewsWire / Gaye Gerard

Mr Mookhey on Wednesday looked to set aside reports of a disquiet Labor caucus.

“This is a difficult reform, and I respect every Labor Caucus member’s right to agree or disagree with it,” he said.

“I’m not going to vouch for what each one of them thinks, but I can simply say that the caucus did support these reforms.

“I’m sure there are some Labor members who would have wanted more time.”

The inquiry reference vote did not go to a division, sparing MPs any record of their support for the bill and preventing any chance to cross the floor.

While the policy’s passage would have represented a pre-budget victory for Mr Mookhey, he said on Wednesday his June 24 budget had already baked in the assumption that the law remained as is.

A one-day inquiry in May heard that under the planned legislation, only 27 individual claimants would remain on indefinite repayment plans.

“Should the house embrace the shadow treasurer’s suggestion ... the opportunity we will miss is to fundamentally begin repairing a system everyone acknowledges is broken,” Mr Mookhey said before the vote on Thursday.

“As he (Mr Tudehope) styles himself as the champion of injured workers, the injured should know his record, and should know the record of their party when it comes to this scheme.

“It is a tough debate. I understand how contentious it is. I understand how hard it is to make some of these choices, but we can’t duck them. We’re not elected here to simply delay tough calls. We’re elected to make them.”