Between 2018-19 and 2022-23, WorkSafe recorded a net deficit of $7.1 billion and the value of its outstanding insurance claims has risen more than 97 per cent since 2018-19.
Labor's own admission that the WorkCover scheme is "fundamentally broken" led to a taxpayer bailout of $1.3 billion across 2020-23 to keep WorkSafe afloat.
Victorian businesses were then hit with a punishing 42 per cent average increase in WorkCover premiums.
WorkSafe's outstanding insurance claims reached $31.9 billion in 2024-25, up from just over $10 billion in 2014-15. These claims now make up 59.3 per cent of the State's total insurance liability, which the Auditor General identified as a Key Audit Matter.
Under Labor's WorkCover Scheme Modernisation reforms, the number of accepted mental injury claims more than halved in 2024-25 to 1,790, down from 3,615 the previous year. At the same time, disputes surged.
The Workplace Injury Commission's 2024-25 Annual Report found:
- Injured workers with rejected mental injury claims increased by 40 per cent, following an 86 per cent jump in 2023-24.
- Disputes over the termination of weekly payments for mental injury claims rose 140 per cent.
- There were 14,595 new conciliation requests, up 18 per cent, driven by rejected claims and compensation terminations at 130 weeks.
WorkSafe's new CEO, formerly of Merri-bek Council, could not answer basic questions at the 2024-25 Financial Performance and Outcomes hearing, including about the scheme's financial position or how many workers had been removed from WorkCover under the tightened eligibility rules. The CEO blamed inadequate systems, despite reports that more than 700 workers were cut from the scheme in the first four months of the new laws.
Shadow Minister for WorkSafe and the TAC, Bridget Vallence, said the findings show a broken system hurting both workers and employers.
"Victoria's WorkCover Scheme has suffered a decade of Labor's financial mismanagement, with outstanding insurance liabilities skyrocketing.
"There are significant increases in the number of injured workers being denied WorkCover, or are in limbo with disputed claims, under the Allan Labor Government.
"This is despite WorkSafe's financial ability to support more injured workers after collecting over $1.7 billion from businesses after massive hikes to WorkCover premiums.
"Victorian businesses have already paid a monumental price for Labor having failed to manage its WorkCover scheme for years.
"Will the government now fulfil the promise made by Minister Ben Carroll in Parliament earlier this year to go back to supporting workers and lower premiums for business?
"Victorians deserve a WorkCover scheme that supports injured workers and is responsibly managed to keep premiums lower."
