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Coalition blows budget on workers' entitlements.

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20 June 2002

Coalition blows budget on workers’ entitlements

A $20 million blowout in the cost of the Coalition’s taxpayer-funded workers’ entitlements scheme shows the need for Labor’s national insurance scheme to cover 100% of workers’ entitlements.

The Government has been forced to ask for the Department of Finance for extra funds to cover the $20 million blowout this year alone in the cost of its taxpayer-funded scheme.

A document tabled in the Senate yesterday (attached) shows that the Department of Employment and Workplace Relations had to go cap in hand to the Department of Finance to seek extra money to meet an “urgent need to meet GEERS payments for the remainder of the 2001-2002 financial year”.

The blow-out comes on top of revelations in Senate Estimates that the Government has managed to process only 54% of claims within 4 months of receiving them (its target is 80%), and that due to caps on the scheme workers have missed out on $9.4 million of their legal entitlements.

Under Labor’s scheme - backed up by a Private Members Bill presented in the Parliament on 11 March 2002 - employers would also have a choice between paying an insurance premium or making alternative arrangements for the protection of entitlements.

Large businesses would be required to contribute to an insurance fund that would ensure that 100% of workers’ entitlements were covered in the event of insolvency. The Federal Government would make payments on behalf of smaller businesses.

Businesses, which propose other methods of protecting workers’ entitlements - such as an industry trust fund - would not be required to contribute to the insurance scheme.

It’s time now that the Government admitted that its taxpayer-funded workers’ entitlements scheme has been an expensive failure and put in place a national insurance scheme to ensure that 100% of entitlements are protected.

For further information: Andrew Dempster 0419 290 610

Shadow Attorney-General and Shadow M inister for W orkplace Relations

Robert McClelland MP