Insurance and Care NSW

Ms ABIGAIL BOYD ( 18:08 :07 ): I move:

(1)That this House notes that:

(a)on 17 June 2025 the Treasurer, the Hon. Daniel Mookhey, MLC, gave evidence to the Public Accountability and Works Committee inquiry into the Workers Compensation Legislation Amendment Bill 2025, in which he said about the Nominal Insurer's finances: "I can report that icare has advised me that the scheme deficit is expected to rise from $4.9 billion at 31 December 2024 to nearly $6 billion in the absence of reform by 1 July"; and

(b)on 13 October 2025, The Daily Telegraph reported data not yet publicly released but provided to them by the Government that based on its June valuation the Nominal Insurer deficit has a reported $5.4 billion deficit, that is, a $600 million lower deficit than that predicted by the Treasurer in June 2025 to justify the proposed cuts.

(2)That this House further notes that:

(a)according to the Government's own data, the scheme financial position is around half a billion dollars better off than predicted when the Government embarked on its proposed cuts to workers compensation entitlements; and

(b)in response to question on notice No. 4129, icare confirmed it is expecting a $4.5 billion claims valuation benefit to the scheme over the next 10 years, however due to actuarial valuation rules that assumption is not incorporated into the scheme's liability estimates and, during budget estimates on 1 September 2025, icare CEO Geniere Aplin and icare Workers Compensation Group Executive Tony Wessling confirmed that this remained icare's assumed impact and reconfirmed it had not been incorporated into the scheme valuation.

(3)That this House calls on the Government to cease providing misleadingly worded statements to the media that imply a worsening financial outlook for icare when the Treasurer's own statements indicate the opposite.

Back in May when we referred the Government's proposed workers compensation reforms to inquiry, I spoke about the profound harm that the Government's bill would have on injured workers in the State. Noting that profound harm, I asked members to think very carefully about whether that harm was justified in the circumstances. For the reforms to be justified, we would need to satisfy ourselves that, firstly, the New South Wales Government compensation scheme was in such dire financial straits that we had no choice but to undertake such radical cuts to workers' entitlements; and, secondly, that if we were so satisfied, that the reforms are the fairest and most effective way of stabilising that financial position. If we are not satisfied of those matters, then we cannot in good conscience vote through a bill that would have such a devastating impact on workers in this State.

Through the Public Accountability and Works Committee inquiry that I have been proud to chair into the Government's proposed bills, we have established a number of matters. Above all, and thanks to the incredible testimony of so many who would be directly impacted, we have established that the harm and damage that would be wrought upon injured workers if we allow the workers compensation bill to go through would be devastating—as bad, or even worse, than I imagined when I gave that speech five months ago. As I made clear then, deciding whether to pass the bill is literally a matter of life or death. We have also clearly established in our inquiry that the financial case for these reforms has not been made out.

As suspected, the Government has been putting forward information that, in the most generous interpretation, is misleading or—more generous still, perhaps—driven by errors. In a less generous interpretation, it is simply the Government lying, catastrophising icare's finances in order to bolster their arguments for introducing such a cruel bill. That brings me to the text of the motion before us where, once again, we have numbers that on the face of them perhaps could be correct, but in the context in which they are put imply a worsening of icare's finances. When we look at what is being said and compare it with what data we already had, it becomes clear that we actually have seen an improvement in icare's finances since the Treasurer first began to catastrophise and tell us that the sky was falling in.

Nowhere is it clearer that the Government and the Treasurer are trying to catastrophise and build a case of fear and imminent disaster than in the Treasurer's insistence on describing contributions to the Treasury Managed Fund [TMF] as a bailout. Alternatively, they are just woefully misguided and do not understand what they are doing. But the Treasurer knows full well that we cannot bail out the TMF. The Treasurer is quite proud of himself for playing his part in instigating the McDougall review of icare. This is what McDougall had to say about the economic literacy of people who criticise the scheme as requiring bailing out:

I add that the opportunistic usage of the term 'bailout' misrepresents the truth, which is that the payment into the TMF was a normal, although in monetary terms very large, incident of the designed operation of the NAHLP.

There is nothing of substance in this allegation. The emotive and pejorative term 'bailout' is unjustified. The report is, factually inaccurate. And, to the extent that the media commentary sought to assign to icare responsibility for the need for the transfer of cash into the TMF, it was wrong.

Let's not get hung up on the Treasurer's florid language, despite his stubborn insistence on continuing its use. It is to be expected when the policy unit of this Government is really a media strategy, utterly lacking in intellectual rigour. The Treasury Managed Fund, according to the Treasurer, is incurring liabilities solely, or at least predominantly, as a result of psychological injuries. The Treasurer made the point—in inaccurate and misleading language, but the core of it remains—that the Treasury Managed Fund has received $6 billion between 2018–19 and 2023–24. He would have us believe that was due to psychological injury payments, but that would be a lie, because between 2018–19 and 2023–24, grants totalling $6.1 billion were transferred from the Consolidated Fund to the Treasury Managed Fund under the Net Asset Holding Level Policy. Of the contributions, $3.7 billion is for general lines, including for COVID, natural disasters and historical abuse claims.

The latest icare annual report reads total liabilities were $2 billion unfavourable to budget, driven by the increase in the provision for outstanding claims liabilities. The TMF workers compensation outstanding claims liabilities were unfavourable to budget largely due to higher claims numbers, lower return to work, an increase in psychological claims—mostly in the non-emergency portfolio—and slower work injury damages finalisations and higher weekly active claims in the New South Wales police portfolio. The TMF general lines outstanding claims liabilities were unfavourable to budget due to the significant increase in child abuse claims, event losses largely relating to floods, a large property claim and the impact of a discrimination class action. I have run out of time. t I commend the motion to the House.

The Hon. ROSE JACKSON (Minister for Water, Minister for Housing, Minister for Homelessness, Minister for Mental Health , and Minister for Youth) ( 18:13 :22 ): I speak on behalf of the New South Wales Government. The Government refutes the points raised by Ms Abigail Boyd in the motion. The statements made by the Treasurer are accurate, or were accurate at the time. The figures provided are point in time. Changes in the share market this year—obvious to anyone who has watched the financial markets closely since June, which the Treasurer certainly has; I make no comment on my own attention to them—would note that they have deflated and then inflated investment forecasts, including investments icare holds against its liabilities. The share market has not, and cannot, change the declining nature of our workers compensation system. Despite stronger than expected returns on investment, the scheme has deteriorated by $1.7 billion over the past financial year. The deficit is getting bigger. That does not seem to be in dispute.

How large the deficit is going to be seems to be the only area of disagreement. The only statements making an ignorant or misleading interpretation of those facts are contained in this motion. I think the Treasurer should be commended for his transparency in regularly reporting updated figures. I think he should be commended for acting to reform the system. It seems that everyone is in agreement about the need for some reform. This House should act quickly to fix a system that is broken for both workers and employers. On that basis, the motion should be opposed.

The Hon. DAMIEN TUDEHOPE ( 18:15 :10 ): I thank Ms Abigail Boyd for bringing this motion to the House, because it clears up, in some way, the fog which the Treasurer, either deliberately or inadvertently, has sought to develop in relation to his vicious attacks on seriously injured workers and the manner in which he has portrayed those attacks since March. Make no mistake, the Treasurer's approach to workers compensation is to attack the most vulnerable. That seems to be lost in this. He is obsessed with using a set of figures to demonstrate his entitlement to attack the most vulnerable. The Treasurer's real concern is to prop up his out of control budget by cutting the liabilities of the Treasury Managed Fund through axing financial and medical support for public sector workers—such as nurses, teachers and Corrective Services officers—with serious psychological injuries.

To achieve this, he has been shamelessly alarming businesses, disability service providers and not‑for‑profits with threats of 36 per cent premium rises based on dire predictions about the Nominal Insurer deficit increasing by $6 million per day. Day after day we hear that outside this place and inside this place, often from members opposite who have been given a speech to read by the Treasurer. The Nominal Insurer "deficit" is not a cash deficit based on income and expenditure over a single year but is rather the difference between total current assets and long-term liabilities. The calculation of long-term liabilities is complex and uncertain. It includes an 11 per cent "risk factor" added on top of all the other elements. The Treasurer has recently revealed that the Nominal Insurer deficit as at 30 June 2025 was $5.4 billion—up $0.5 billion in the six months since 31 December 2024.

This increase was at $2.76 million per day. Not good, but less than half the daily increase predicted by the Treasurer. This 50 per cent plus reduction was achieved by icare without the passage of either of the Government's harsh workers compensation bills. But rather than welcome this good news, the Treasurer is yet to correct his $6 million per day figure. This is being quoted by Labor members of Parliament, the media, alarmed businesses and not-for-profits. This motion should be supported, because the language of the Treasurer has been nothing but disgraceful.

The Hon. STEPHEN LAWRENCE ( 18:21 :40 ): I did not intend to speak, but I am moved to do so. I speak against the motion. The Government refutes the points that have been raised and is very firmly of the view that all the Treasurer's statements on this matter have been accurate—or were accurate at the time. Things change and figures are provided at a certain point in time. The changes in the share market this year have been obvious to anyone who has watched the financial markets since April. They deflated and then inflated investment forecasts, including investments that icare holds against its liabilities. Obviously, that cannot be avoided and not necessarily predicted.

The share market has not and cannot change the unfortunate reality of the declining nature of our workers compensation system. Having been a part of the first and shorter inquiry into the bill, I did not hear any evidence from anyone who proposed that no change was necessary. There seemed to be consensus that change is necessary, and the argument is about the nature of that change. The fact is that the only statements that are misleading or contain a misleading interpretation of the facts are the statements in the motion. The Treasurer should be commended for his transparency.

The Hon. Rose Jackson: Point of order—

The DEPUTY PRESIDENT ( The Hon. Emma Hurst ): The Clerk will stop the clock.

The Hon. Rose Jackson: I understand that this is a heated debate. Government members listened in silence to some pretty hostile contributions yet every single Government member who has spoken has been peppered with interjections that have been really quite nasty at times. It is not becoming. If members cannot have the discipline to sit and listen to other members respectfully, they should go to their office and watch the debate on television.

Ms Abigai l Boyd: To the point of order: I agree that we need to have respectful debate and that interjections are disorderly at all times. But last Thursday night I was on the receiving end of some of the nastiest comments I have ever experienced in this place from members on the Government benches, so it is a little hypocritical.

The DEPUTY PRESIDENT ( The Hon. Emma Hurst ): I will not call any member to order but I remind members—particularly those who have been called to order several times—about their behaviour in the House. The Hon. Stephen Lawrence has the call.

The Hon. STEPHEN LAWRENCE: I was so engrossed in my submission that I did not notice what was going on. I address the issue of the $4.5 billion referred to in the motion in paragraph 2 (b), which states:

… in response to Question on Notice 4129, icare confirmed they are expecting a $4.5 billion claims valuation benefit to the scheme over the next 10 years, however due to actuarial valuation rules that assumption is not incorporated into the scheme's liability estimates, and during budget estimates on 1 September 2025, icare CEO … and icare Workers Compensation Group Executive … confirmed that this remained icare's assumed impact and re-confirmed it had not been incorporated into the scheme valuation.

The motion makes assertions in respect of that, but the Government's position is that the $4.5 billion represents avoided liabilities.

The Hon. DAMIEN TUDEHOPE ( 18:25 :53 ): Mada m Deputy President—

The DEPUTY PRESIDENT ( The Hon. Emma Hurst ): Is the Hon. Damien Tudehope seeking to speak further?

The Hon. DAMIEN TUDEHOPE: I seek to speak a second time. This arises pursuant to Standing Order 92, "Explanation of speeches". A member who has spoken previously may speak a second time to explain a matter that has been misunderstood. I suggest that in his contribution to debate, the Hon. Bob Nanva certainly misunderstood my position.

The DEPUTY PRESIDENT ( The Hon. Emma Hurst ): Is the Hon. Damien Tudehope seeking to clarify his position?

The Hon. DAMIEN TUDEHOPE: Yes. I put to the member that the Treasurer understood the state of the scheme at the time he was making submissions. It is directly relevant to the heart of this motion that he understood the true position of the scheme but continued to represent the old position in relation to the scheme. An additional point is that the Treasurer can make misleading statements through neglect. A member should not hide something they know to be true. Members should be transparent and identify the truth. The case in point is that the Treasurer knows icare advised him that it expects a $4.5 billion in claims valuation benefit to the Nominal Insurer over 10 years, but this expectation is not reflected in valuations by the actuaries.

It can be, and ought to be, taken into account by the Minister for Work Health and Safety when she has the power to give a statutory direction capping the average rise and the Nominal Insurer premiums. If this $4.5 billion is fully taken into account, there is no reason premiums should rise and cannot be capped around consumer price index rises. The Treasurer made the misleading statement that he knows material to be true. Icare told him about the revaluation of the scheme based on available material, yet in all his public disclosures about that the Treasurer seeks to scare businesses, the not‑for‑profit sector and the disability sector into thinking their premiums will increase.

The Hon. Bob Nanva: Point of order: The member sought to make an explanation under Standing Order 92, which is to explain a matter on which the member has been misquoted or misunderstood. I suggest that he is now introducing new matters into the debate.

The DEPUTY PRESIDENT ( The Hon. Emma Hurst ): In regard to Standing Order 92, a member may speak a second time if their remarks are strictly confined to matters upon which they feel they have been misunderstood. I remind the member that he may not introduce new matters. I think he was skating close to moving on to new matters.

The Hon. DAMIEN TUDEHOPE: I acknowledge that, but it goes to— [Time expired.]