It is a great honour to kick off 2016 with the first contribution. I am in continuation on a speech that I think I gave back in May last year, so forgive me if I am a bit rusty on some of the details of this bill. I had a lovely break with the family over Christmas and, during that break, I forgot most of what was in the Safety, Rehabilitation and Compensation Legislation Amendment (Exit Arrangements) Bill 2015. But I swotted up on it this morning and I am ready to make a further contribution on this very important bill.
It is rather an administrative and process driven bill, but nonetheless it is important because it is about ensuring, ultimately, that we have a more financially robust and sound way of ensuring people who are injured at work receive appropriate compensation.
As I am sure you are aware, Mr President, the Comcare scheme is the Australian government scheme to help and rehabilitate workers who are injured, largely in Commonwealth workplaces but other agencies can be members of this scheme. Some Commonwealth agencies have their own arrangements and are not members of the Comcare scheme. The ACT previously had an arrangement where it was a member of this scheme for the purposes of its employees and was defined as a Commonwealth agency for those purposes.
The need for this bill to amend the Safety, Rehabilitation and Compensation Act 1988 has largely been brought about because the ACT has made a decision to leave this scheme, which is their right. They have previously been a member of the scheme, but they have decided that it is too costly and there are too many delays, and they are going to seek their own arrangements for their public servants and employees. It is perfectly their right to do so. This decision was announced last February; on 26 February The Canberra Times reported that the ACT government would be leaving the Comcare scheme. Because of that, the Commonwealth government has decided that it is important to ensure the continuing financial viability of the Comcare scheme, notwithstanding the ACT leaving, because many of the employees or former employees who require compensation under the scheme are or were ACT public servants. Of course, with the ACT government leaving the scheme, there will be fewer premiums going forward to fund those costs. Indeed, my understanding is that the ACT government is the fourth-largest premium payer in the Comcare scheme, so it is a sizeable contributor to the overall budget. Given the sizeable number of ACT public servants, there would also be a sizeable number of those receiving compensation through the Comcare scheme. So the ACT's leaving will leave a financial burden for Comcare, and is very important we maintain its financial viability. To do so, the government has proposed providing arrangements for an exit fee for members who seek to exit the Comcare scheme. In this case, when the ACT exits, a fee will be calculated based on the actuarial value of the future commitments for those former ACT public servants and their compensation needs, and the ACT government will pay to leave the scheme.
It is not a particularly novel approach to these arrangements. I made the point back in May that we have similar arrangements for irrigators who leave an irrigation scheme without paying or amortising the full cost of the network. When they leave, they have to pay an exit fee so that the rest of the irrigators are not left with those costs. The same arrangements will apply here. The ACT government will be asked to pay a fee so that all the other Commonwealth agencies are not asked to pick up the bill for ACT government employees.
It is also something that exists in other parts of the country. While this is the first time we will establish such an arrangement for Commonwealth workplace compensation, my understanding is that workplace compensation arrangements in New South Wales, Victoria, Queensland and South Australia all allow for an exit fee to be charged to agencies or organisations that leave their schemes. Those arrangements are similar to what we are proposing. It is a perfectly sensible approach to this particular issue that has arisen as a result of the ACT decision. While it is the first time we will set up an ongoing, committed and generic arrangement for exit fees, the Commonwealth parliament established similar arrangements when Medibank Private was privatised and it left the Comcare scheme. A fee was calculated for it, and special legislation was agreed to by the Australian parliament at the time to establish the authority to levy that fee. What we are doing here is simply repeating that approach, but we are not doing something specific for the ACT government. Instead, we are setting up a process which would apply if, in the future, any payer that is currently a Comcare premium payer decided to leave the Comcare scheme.
The Senate Education and Employment Legislation Committee, chaired by my colleague Senator McKenzie, has looked at this issue as well. It recommended we should pass this particular scheme. It noted in its report that the current Comcare scheme is actually not fully financially funded. It is not fully funded right now because, over time, premiums in the past were not set based on actuarial values. Premiums paid into the scheme did not fully cover the costs of workplace injuries. However, there has been a slight improvement over the past year. I believe it had 68 per cent of funds available for what was measured as the actuarial funds needed. Around 68 per cent were covered. I believe that has gone up above 70 per cent in the past year, but there is still a sizeable unfunded gap there. Given that gap, we cannot afford to have that gap grow by not appropriately levying the ACT government for the ongoing costs imposed on the Comcare scheme by leaving and, of course, no longer paying premiums for its workplace employees who have been injured.
As I said, the Senate committee in its majority report recommended the bill be passed. However, I note that Labor senators on that committee did not quite agree. I do not believe they made a recommendation, but in their report Labor senators urged the government to request that the ACT government provide written assurances to ensure its workers would not be worse off. What that was going to was that the ACTU made a submission to the inquiry, saying that the new ACT workplace compensation scheme that could be established may not fully compensate workers for their injuries to the same level that the Comcare scheme does. As the government said in response to that, it is a matter for the ACT government. It is not a matter for the Commonwealth government. The Comcare scheme was not established to take care of ACT government employees. It was set up to allow the ACT government to have access to a well-funded and liquid pool of workplace insurance to meet its required needs—needs that it would establish. It is not our job to establish those needs; it is up to the ACT government. It is not the Commonwealth government's responsibility to decide how the ACT wants to deal with and fund workplace injuries in its own workplaces. We had this option available as a product. The ACT government has decided not to buy our product going forward. That is their right, but it is not our job to try to second guess what they want to do over the other side of the lake in their legislative assembly.
What was also a little bit unusual and perplexing about the Labor senators' recommendation that we request the ACT government to provide such assurances is that, as I said earlier, the ACT government made this decision and it was announced on 26 February last year. As many senators would be aware, the ACT Chief Minister at that time was Katy Gallagher, who is now a Labor senator in this place. Labor senators are saying that the decision made by that ACT government in February last year was insufficient and denied workers their proper rights. Well, instead of asking the ACT government, could they not just ask their colleague Senator Gallagher? That would be a suggestion for the Labor Party if they have concerns about this.
If they have concerns about the decision that the ACT government made last February, surely they could ask the former chief minister, who made that decision and signed off on that decision last February. They signed off on that decision last February. It was a decision made by Ms Katy Gallagher. I make no particular complaint about that decision. I do not know the specifics of what the ACT government had to consider when they decided to leave the Comcare scheme, but they made a considered decision to do so. Ms Katy Gallagher is now Senator Gallagher, senator for the ACT, and surely if they want an explanation about the decision making of the ACT government they could go to their own senator.
What this indicates to me is not that the Labor Party have some principled objection to the arrangements that are being put in place here—which, as I said, are rather technical and are replicated over the rest of the country, but that the Labor Party simply want to oppose everything that is put up by this government. They do not want to do anything that may be constructive and forward moving for our country, as limited as this particular issue is. They are simply on the lookout for particular political differences that they can abuse and take advantage of for political purposes, not for national interest purposes. That to me needs to be called out. Why are they really opposing this bill? Is it because the ACTU have said to do so and they have made a submission against it? Is it because some of them see Senator Gallagher as a threat to their future positions? She has just been promoted recently. Is that the reason? Why are they opposing this? A territory government of their own political colour has decided to do this, and they are still opposing it. This is a legislative amendment being proposed as a consequence of that ACT decision, but it is being proposed by a Liberal-National government and not by a Labor government. That is why they are opposing this.
I know the federal Labor Party seem to like to pick fights with state and territory governments at the moment. They are warring with at least one state Labor government at the moment, South Australia, about their confused position on how to fund policies. At the moment it is World War III between South Australia and the federal Labor Party over the GST. But you would think they could at least get their story straight on something as administrative as workplace compensation arrangements. But they cannot even do that. They will oppose everything we put up.
I think later this afternoon or this evening we will debate in this chamber a motion about how the Liberal-National party coalition have not changed. We have not changed, because we are continuing to provide good government and are continuing to make decisions like this in the interests of the nation. But the Labor Party also have not changed. A new year may have ticked over, but it is the same Labor Party opposing everything we put up. It is the same Labor Party simply wanting to make political points and not wanting to deal with issues overall in the national interest. They just oppose everything that the coalition government does. They are good at negativity, but they are not good on policy, and that is what their approach is here today.
Maybe I am being too pessimistic, Mr President. Perhaps I should be less cynical in my first contribution here today in this chamber. Maybe I should be more positive. I did say that I would turn over a new leaf on a few things. So maybe I should give the Labor Party a bit more of a fair go. Perhaps the next speaker on this bill will get up and say that over the break the Labor Party have reconsidered, they have turned over a new leaf, they have made a new year's resolution not to simply oppose everything, and they will come out and support this bill because it is pretty simple, it is technical and administrative and it happens in other states. Perhaps they will get behind the government and support this bill. Perhaps that is what they will do.
It is a new year and it is a new opportunity. Hopefully they have made some new year's resolutions, like the rest of us, and perhaps that is what they will do. If they do, I will have to come into this place and eat humble pie and I will have to say, 'The Labor Party have turned over a new leaf and they are going to support this.' Perhaps their next step will be to support more transparency and oversight of trade unions that have shown themselves to be completely worried about their own back pockets and not their workers' interests. Hopefully their next step will be that they join us in making sure that we reform those arrangements.
Maybe their next step will be to actually join us in how to fix our budget situation, which is still far too negative. We need to do more on that front, but the Labor Party have produced no suggestions to help fund budget repair over the longer term. Perhaps they will join us in a proper tax reform debate, rather than going around and eating lettuce and annoying mums and dads in supermarkets and running a ridiculous scare campaign. Perhaps they will do that as well but, I am sorry, Mr President, despite it being a new year, I am not that hopeful that the Labor Party will be dragged that far. But let's just hold our breath and hope that they will reconsider and join the coalition government here, the Liberal Party, the National Party, many of the crossbenchers and at times the Greens and actually help us to get something done for this country and move this place forward.
As I said, this issue in front of the government is not a nation-changing issue. This is not going to be a watershed moment for our Commonwealth. But it is small example of how an inflexible negative approach stops us from making the little decisions that add up to making this a better place and enabling better government and better governance for our whole nation. So I implore the Labor Party and other senators to look at the detail of this bill. It is a sensible bill. It builds on what is already a good scheme in Comcare. It uses other states as examples of what should be done in this scheme. It will help make sure that we have a sound financial footing for what is a very important scheme and it will help ensure that we can continue to pay those unfortunate workers who are injured while at work for the Commonwealth.