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Thursday, 24 February 1977
Page: 430

Mr HUNT (Gwydir) (Minister for Health) -The Leader of the Opposition (Mr E. G. Whitlam) has indicated his Party's approach to the reform of the compensation systems in Australia. I now intend to outline how the Government proposes to approach this matter. There is a fundamental agreement on many aspects of a national compensation program. In 1973 the previous Government established a committee of inquiry into rehabilitation and compensation in Australia under Mr Justice Woodhouse of New Zealand. Mr Justice Woodhouse of course had previously headed a royal commission of inquiry in New Zealand which ultimately resulted in the introduction of an accident compensation scheme in 1974. The committee's report was tabled in the Australian Parliament in July 1974 and it included a draft national compensation Bill. That Bill was modified, introduced into Federal Parliament and passed by the House of Representatives in October 1974. In the same month the clauses of the BUI were referred to the Senate Standing Committee on Constitutional and Legal Affairs. The Committee reported to Parliament in July 1975, raising many objections to the Bill. As the Leader of the Opposition knows, the then Government was in the process of reviewing the Bill when Parliament was dissolved in November 1975. Enormous efforts would have been required, however, before the scheme could have been regarded as generally acceptable and workable. For instance, the scheme was not supported by all sections of the community. Its financial and economic implications had not yet been fully resolved. The States did not support all the proposals and the constitutional validity of the proposed authorising legislation was also in question. In view of these difficulties the new Government decided not to proceed with the Bill.

Before outlining the weaknesses which exist in the current compensation system it is necessary to describe the present position. The existing systems which provide monetary benefits to those who suffer incapacity as a result of personal injury or who are dependent on or related to a person killed as a result of personal injury include common law, including fatal accidents legislation, workers' compensation, no-fault motor accident compensation, criminal injuries compensation, air accidents liability, social security, superannuation, sick leave and private loss insurance. Many of these systems fall within the jurisdiction of the States, although the lack of rationalisation results in unnecessary expenditure and produces difficulties for victims. Some of these have been referred to by the Leader of the Opposition.

The weaknesses which led to the Woodhouse inquiry still exist. I shall outline some of them as we see them. Most self-employed persons are not covered by workers' compensation. This group is estimated to comprise over 10 per cent of the work force. There is a lack of uniformity as to benefit structures, entitlements and administrative practices. For example, unlike the rest of the Australian working population, 20 to 30 per cent of workers in Victoria and New South Wales do not receive weekly compensation of 100 per cent of award wagesin the first 26 weeks of injury. Over 30 per cent of motor accident victims, due to the absence of negligence on someone else's part, are unable to sue for damages at common l aw. However, there would be an entitlement for hospital and medical expenses under health insurance arrangements, as well as income maintenance for short term injuries under sick leave provisions.

Settlements of common law damages are slow. Damages are reduced by contributory negligence irrespective of the needs of the injured person and are adversely affected by inflation because they are paid in a lump sum. There have been high losses by State government insurance offices and private insurers in both workers compensation and third party fields. Premiums charged to employers for workers compensation insurance and to motorists for compulsory third party insurance, which amount to over $ 1,000m a year, have become a real burden and further increases will be necessary. Some relief is provided to employers, however, by allowing these premiums as tax deductions.

Mr DEPUTY SPEAKER (Mr Lucock)Order!As it is now 2 hours after the time fixed for the meeting of the House, consideration of notices is interrupted.

Motion (by Mr Hunt) agreed to:

That the time for the discussion of notice No. 1 on the general business paper be extended.

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