Workers Compensation in Victoria: From WorkCare to WorkCover

Abstract

When the Victorian Labor government created the WorkCare system in 1985, it believed that the government takeover of the workers compensation system from private insurers would permit the creation of a system that could provide more generous and compassionate benefits for injured workers. while first containing and then reducing costs to employers. The WorkCare system never succeeded in reconciling these goals. Instead, it became enmeshed in financial difficulties and failed to acquire either stability or political legitimacy throughout its seven years of existence. This failure made it possible for the incoming Coalition government to bring down the curtain on the WorkCare system at the end of 1992, and to replace it with a scheme based on harsh and ungenerous treatment of injured workers. Coalition policy is that this new 'WorkCover' scheme will be privatized once its financial position is stabilized. However. there is considerable uncertainty about whether privatization ultimately will occur.