And despite backing from the NSW business lobby, the reforms have raised the eyebrows of the NSW Coalition. Shadow treasurer Damien Tudehope said that while the Coalition would not adopt a position on the reforms until the government releases a bill, expected next month, any move to double the level of impairment required for lump sum damages required scrutiny.
NSW Treasurer Daniel Mookhey criticised icare from opposition.Credit: Sam Mooy
“The current method of calculating the whole-of-person impairment percentage for psychological injuries is extremely complex,” Tudehope said.
“Before simply lifting it from the current 15 per cent to, say, 30 per cent, which has been mooted, it would be necessary to understand from the relevant experts what this would mean in practical terms for injured workers.
“Any change to the workers compensation scheme needs to be carefully examined for its long-term impacts, and not rushed.”
Parmegiani, who led the design of the Psychiatric Impairment Rating Scale used to measure serious psychological injuries in NSW, has no doubt about the impact of the change. He said the scale, which has been adopted with variations across Australia and in the US, rates a person’s impairment based on factors including their ability to keep up personal hygiene, enjoy social activities and maintain relationships.
“The benchmark is already very high,” Parmegiani said. “At 15 per cent, a person is not functioning in their day-to-day life. You’re not able to enjoy yourself, you’re not leaving the house, your marriage has broken down, you’re not showering or looking after yourself.
“At 30 per cent, you’ve basically got to be in an institution, or at home with carers.”
Now retired, Parmegiani is a Liberal Party councillor in Woollahra. But after spending more than a decade in workers compensation, he lays much of the blame for the increasing cost of psychological injury on icare itself.
“Their board doesn’t have a single occupational psychiatrist on it, and most of their business is psychiatric impairment and function,” he said.
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With the government yet to reveal the legislation, it remains unclear whether it will push ahead with all the proposals floated so far. The NSW Police Association says it believes it will be exempted from some of the changes.
In opposition, Labor mounted a long-running campaign against icare’s management. Mookhey attacked its executive pay and the lavish contract spending at the nominal insurer.
Tudehope said that while Mookhey was “quick to criticise the Coalition for perceived flaws in how workers compensation schemes were managed” from opposition, he was “ready to diminish access to workers compensation to solve his problem with Labor’s bottom line”.
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