Government agencies will fork out $15 billion a year from insurance claims by 2028, a 36 per cent surge that threatens to rock the state’s already struggling finances.
Victorian government agencies are expected to pay out $15 billion a year from insurance claims by 2028, a 36 per cent increase that could wreak havoc on the state’s finances and leave taxpayers facing huge top-up payments to keep the organisations solvent.
Victoria’s budget is already under significant strain. Ballooning net debt, racked up during the pandemic, is forecast to reachThe department’s forecasts predict even more pain on the horizon for the agencies known as public financial corporations. These agencies are meant to fund themselves, but taxpayers have topped them up when they have fallen short.The forecasts show that in the 2023-24 financial year, it was expected the agencies would pay out a total of $9.
The state government will hold an independent review of WorkSafe by the end of the year to check whether these changes are working and whether the WorkCover compensation scheme is sustainable. “If something is damaged, it’s costing more to either replace or rebuild it,” Oliver said. “When the value of claims goes up, you run down your reserves.”Oliver said governments couldn’t prevent weather events but could attack the problem by reining in inflation across the economy.
“The continued multibillion-dollar losses year-on-year in this sector are simply unsustainable, and whether through higher premiums, poorer services or taxpayer-funded bailouts, Victorians ultimately pay the price.” “Furthermore, according to Safe Work Australia, there are trends indicative of an increasing level of psychological injuries in workers’ compensation claims in recent years.”
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