Wednesday, 28 May 2025

WorkCover premiums

David LIMBRICK (South-Eastern Metropolitan) (18:37): (1671) My adjournment matter this evening is for the attention of the Minister for WorkSafe and the TAC. I have recently met with several stakeholders to discuss yet another pressure on businesses that is making it difficult for people to succeed in Victoria. First, I met with a young couple that are trying to expand their tiling and interior design business. They expressed frustration with the difficulty of shifting from being sole traders to establishing a business with the potential for growth. The challenges they experienced included difficulty in estimating the up-front costs, making it difficult to budget for expected outlays; high premiums despite no claims history; and no differentiation between costs for staff doing admin tasks and staff doing site work. It was a really difficult meeting with them. They are a couple with a great business idea to provide for their family, but the escalation in materials, costs, taxes and other charges and then a much higher than expected insurance premium just slow any progress.

But they did not come with just their own story; they brought several case studies from other businesses. These included one that experienced an over 600 per cent growth in premiums over six years, with no claims history and an unblemished record, another business that collapsed after an incorrect charge that was not rectified quickly enough to save the business and one that suspected they might have been targeted after receiving several audits after raising concerns, despite no history of claims or safety issues. It is tough out there in business, but these are not isolated concerns.

I also met recently with South East Melbourne Manufacturers Alliance. They also raised concerns our WorkCover premiums are impacting manufacturers in the south-east. This relates to the impacts on 50 per cent of manufacturers in Melbourne that employ over 250,000 people. Of the members that they surveyed, 100 per cent of them had experienced an increase in premiums, with the average range from 25 to 55 per cent, and 100 per cent of them said that they would be forced to increase prices, reduce spending on capital investment or delay hiring new staff. They also noted other likely impacts, such as creating a deterrent to employment and incentives for under-reporting incidents.

To reflect some of the key concerns raised with my office, my request to the minister is to review premium calculations to ensure fairness and account for specific circumstances of businesses, to improve consultation and communication and to consider tax deductions or credits for businesses with a good safety record of no claims.