"The NSW workers' compensation scheme plays a crucial role, but it needs to remain sustainable and focused both on delivering support to workers who have an injury with a clear connection to work and encouraging those employees who are able to work to maintain their engagement in employment," said Innes Willox, Chief Executive of industry peak body the Australian Industry Group.
"The average premium for employers in NSW increased by 8% in 2023/24 and a further 8% in 2024/25; industry is bracing for further significant premium increases in 2025/26. This has in part been a product of a dramatic and rapid rise in claims connected with the complex circumstances of employees dealing with psychological illness.
"On any reasonable assessment, both the current costs of the system and the trajectory of future increases in premiums are unstainable.
"Industry welcomes the Government's determination to grapple with the need to ensure the workers' compensation system remains viable. There is clearly a burning need to adopt sensible measures to constrain premium costs. Addressing the complex issue of how claims connected with psychological illness are dealt with is a necessary part of the puzzle. We need to continue to look at ways to enhance industry's ability to improve the management of workplace health and safety, as well as the management of claims.
"Parliament must not lose sight of the desperate need to tackle the unstainable cost impact of ballooning premiums on employers in NSW. Those ballooning costs mean employers are less able to invest in people, plant and equipment at a time when we are becoming less productive and competitive by the day," Mr Willox said.
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