WorkSafe Victoria weathers financial storm

WorkSafe Victoria has improved its financial position with a solid increase in its performance from insurance operations and a record reduction in workplace injuries in the first half of this financial year.

WorkSafe’s performance from insurance operation (PFIO) - the key measure of the scheme’s financial performance - rose to $288 million for the half year compared with $168 million at the same time in 2008-09.

PFIO is the most accurate measurement of the scheme’s performance, as it reflects the matters WorkSafe can control (such as claims management) and excludes the impact of fluctuating investment markets.

An actuarial release (improvement on forecast claims liabilities) of $57 million is up from $7 million at the same time in the previous year. Also adding to WorkSafe’s positive financial position is a funding ratio of 109%.

An improving investment market has driven a $686 million after-tax profit compared with a paper loss of $1.42 billion at the end of the first half of the 2008-09 financial year.

The interim figure on workers compensation claims per thousand workers stands at 10.32, down from 10.8 per 1000 workers at the end of the last financial year.

The Chair of WorkSafe, Elana Rubin, said while the financial results and the reduced injury rate pointed to a financially sound and well-managed workers compensation system, reduced hours worked during the economic downturn may have helped cut the injury claims rate.

Rubin added that now is not the time to be complacent. The scheme continues to face many challenges - including continuing to provide leadership in the move to uniform OHS laws, the implementation of the Accident Compensation Act reforms (currently before Parliament) and addressing the growing concerns regarding common law plaintiff legal costs and lodgements.

“While injury rates dropped, there has also been a significant increase in work-related deaths with 14 work-related fatalities reported between June and the end of December and five more since then,” she said. “This is a shockingly high number and requires broad community involvement if it is to be reduced.

“Our system is set up to encourage prevention, enforce the law and support those who have been hurt, but the obligation begins in every workplace to ensure employers, managers, supervisors and workers do what they can to build safer workplaces.

“With this input, there will be human and commercial benefits and the Victorian community will continue to have a sustainable and soundly managed scheme with competitive premiums, ensuring injured workers get the help they need.”