ANNUAL REPORT 2005-06 - comcare.gov.au · australia’s safest workplaces 5 table of contents letter of transmittal 3 the director’s report 10 comcare overview 13 legislation 14

ANNUAL REPORT 2005-06

2

PUBL ICAT ION DETA ILSPublished by Comcare

© Commonwealth of Australia 2006

PUB 1 – 2005/06 edition

ISSN 1325-1031 (hard copy)

1832-0260 (online)

ISBN 1 921160 02 0 (hard copy)

1 921160 03 9 (online)

ABN 41 640 788 304 (Comcare)

This work is copyright. Apart from any use as permitted under the Copyright Act 1968, no part may be

reproduced by any process without prior written permission from the Commonwealth available from the

Department of Communications, Information Technology and the Arts. Requests and inquiries concerning

reproduction and rights should be addressed to the Commonwealth Copyright Administration, Intellectual

Property Branch, Department of Communications, Information Technology and the Arts, GPO Box 2154,

Canberra ACT 2601 or posted at www.dcita.gov.au/cca.

REPORT ACCESSTo obtain further information about the contents of this report, please contact

Corporate Management Division

Comcare

GPO Box 9905

Canberra ACT 2601

This publication is available on the Comcare website at www.comcare.gov.au

Design: Comcare

Printing: Goanna Print #55

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Australia’s Safest Workplaces

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LETTER O

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TABLE OF CONTENTS

LETTER OF TRANSMITTAL 3

THE D IRECTOR’S REPORT 10

COMCARE OVERV IEW 13

LEGISLAT ION 14

ROLE 14

THE SAFETY , REHAB IL I TAT ION AND COMPENSAT ION COMMISS ION 15

ORGANISAT IONAL STRUCTURE 15

STRATEG IC PLAN 17

KEY RESULT AREAS 17

PERFORMANCE SNAPSHOT 19

REPORT OF OPERAT IONS 25

STRATEG IC IN IT IAT IVES 26

KRA 1 : IMPROV ING THE SAFETY AND REHABIL I TAT ION OF EMPLOYEES AND 26 THE COMPENSAT ION SERV ICES WE PROV IDE

ACT IV ITY 26

Leadership and Accountability Strategy 26

Safety Leadership 26

Target setting 27

Review of self-assessment tools for return to work management systems 29

Body Stressing Research 29

Psychological Injury Strategy 30

Interagency Job Placement Program 30

KRA 2 : ENGAGING OUR STAKEHOLDERS AND CUSTOMERS 30

ACT IV I TY 30

2005 Comcare National Rehabilitation Conference 31

Whole of Agency Strategy 31

Customer Seminars 31

External training 31

Commonwealth Compensation Liaison Committee 31

Licensee/Comcare Consultative Forum 32

Customer Information System User Group 32

National Public Sector Injury Prevention & Management Forum 32

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KRA 3 : SUPPORT ING OUR PEOPLE 32

INVEST ING IN OUR PEOPLE 32

ACT IV I TY 32

Leadership 32

Organisational Development 33

People Management Committee 33

Staff Survey 33

Recruitment and Selection 33

Employee Relations 33

Agreement making 33

Flexible working arrangements 33

Performance management 33

Learning and development 33

Studies Assistance 34

General learning strategies 34

Occupational Health and Safety 34

Sign-on 34

Absence management and the Action Plan for Improved Safety and Attendance 34

Health and Wellbeing 34

Health and Safety Representatives 35

Workplace incidents 35

Prevention 35

Investigations under s74(1)(f) of the OHS(CE) Act 35

Workplace harassment policy and contact officers 35

Employee Assistance Program 35

Workplace diversity 35

Reward and recognition 36

PERFORMANCE AGA INST OUTPUTS 37

COMCARE ’S OUTCOME AND OUTPUTS FRAMEWORK 38

RESOURCES FOR OUTCOME 39

F INANCIAL PERFORMANCE 42

REGULATORY SERV ICES 43

OUTPUT 1 .1 – SRC ACT REGULAT ION 43

SAFETY , REHAB IL I TAT ION AND COMPENSAT ION ACT 1988 43


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KEY PO INTS 43

ACT IV I T IES 43

PERFORMANCE 46

OUTPUT 1 .2 – OHS(CE) ACT REGULAT ION 47

OCCUPAT IONAL HEALTH AND SAFETY (COMMONWEALTH EMPLOYEES) ACT 1991 47

NAT IONAL OHS STRATEGY 47

KEY PO INTS 48

ACT IV I T IES 48

PERFORMANCE 51

CLA IMS MANAGEMENT 52

OUTPUT 1 .3 – MANAGEMENT OF PREMIUM CLA IMS 52

OUTPUT 1 .4 – MANAGEMENT OF PRE-PREMIUM CLA IMS 52

OVERV IEW 52

OUTPUT 1 .3 – MANAGEMENT OF PREMIUM CLA IMS 55

KEY PO INTS 55

ACT IV I T IES 55

PERFORMANCE 58

OUTPUT 1 .4 – MANAGEMENT OF PRE-PREMIUM CLA IMS 60

OUTPUT DESCRIPT ION 60

KEY PO INTS 60

ACT IV I T IES 60

PERFORMANCE 60

OUTPUT 1 .5 – REGULAT ION OF THE SEACARE SCHEME FOR WORKERS ’ COMPENSAT ION , 61REHABIL I TAT ION AND OCCUPAT IONAL HEALTH & SAFETY

KEY PO INTS 61

ACT IV I T IES 62

PERFORMANCE 62

OUTPUT 1 .6 – MANAGEMENT OF ASBESTOS RELATED PERSONAL INJURY COMMON LAW 63D ISEASE CLA IMS AGA INST THE COMMONWEALTH

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KEY PO INTS 63

PERFORMANCE 63

COMPARAT IVE PERFORMANCE INFORMAT ION 65

PERFORMANCE AGA INST TEN-YEAR TARGETS 66

COMMISS ION IND ICATORS AND ANNUAL TARGETS 68

PERFORMANCE AGA INST COMMISS ION IND ICATORS AND ANNUAL TARGETS 68

EMPLOYER PREMIUM OUTCOMES 70

PUBL ICAT ION OF PREMIUM RATES 70

NAT IONAL RETURN TO WORK MONITOR 74

MANAGEMENT AND ACCOUNTAB IL I TY 77

CORPORATE GOVERNANCE 78

COMCARE EXECUT IVE AND D IRECTOR’S MEET ING 79

AUDIT COMMITTEE 79

INTERNAL AUDIT 80

R ISK MANAGEMENT 80

FRAUD CONTROL PLAN 80

PROCUREMENT FRAMEWORK 80

RECORDKEEP ING 81

MANAGEMENT OF HUMAN RESOURCES 81

SENIOR EXECUT IVE SERV ICE (SES) REMUNERAT ION 87

PERFORMANCE PAY AND BONUSES 87

CONSULTANTS AND COMPET IT IVE TENDER ING AND CONTRACT ING 87

POL ICY AND PROBITY 87

CONSULTANCY SERV ICES 87

DETA ILS OF CONTRACTS LET FOR CONSULTANCY SERV ICES 87

COMMONWEALTH D ISAB IL I TY STRATEGY 88

F INANCIAL STATEMENTS 89

COMCARE 92


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APPENDICES 133

1. FREEDOM OF INFORMAT ION 134

2 . PR IVACY 136

3 . EXTERNAL REV IEW 137

4 . PROCEED INGS 138

5 . SOC IAL JUST ICE AND EQUITY 139

6 . INDEMNIT IES AND INSURANCE PREMIUMS 140

7 . ADVERT IS ING AND MARKET RESEARCH 141

8 . ECOLOGICALLY SUSTA INABLE DEVELOPMENT AND ENV IRONMENTAL PERFORMANCE 142

9 . COMMONWEALTH D ISAB IL I TY STRATEGY 143

INDEXES 149

CONTACT INFORMAT ION 150

TABLE INDEX 151

GLOSSARY 152

ALPHABET ICAL INDEX 156

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THE DIRECTOR’S REPORT

THE DIRECTOR’S REPORTComcare’s priorities are to promote safe and healthy

workplaces; provide accessible and affordable

compensation services; and encourage and

support the early and safe return to work of injured

employees.

The last 12 months have been a busy time for

Comcare. We have bedded down several important

changes to the legislation under which we operate,

including the strengthening of powers and penalties

in relation to workplace health and safety. Further

legislative changes have been announced by the

Australian Government to reinforce the connection

between employment and eligibility for workers’

compensation. There has also been an increase in

the number of businesses obtaining self insurance

licences under the Commonwealth scheme.

These changes required us to review and refine

our corporate governance structure and business

practices and to adjust our priorities so that we

maintain the right level of staff and resources.

We have reviewed and enhanced Comcare’s legal

capacity, increased the number of OHS investigators

and provided more staff to deal with increases in

complex workers’ compensation claims. We have

also made a considerable investment to improve

the collection of data and information. This will

let us develop a better picture of performance and

outcomes in prevention, workers’ compensation

and injury management. The result will be better

targeting of our research program and strategies and

the services available to employers.

The workers’ compensation scheme under which

Comcare operates, like those in most jurisdictions,

has in recent years been under considerable

pressure due to a significant increase in complex

injuries and compensation costs. It is pleasing to

see that there are early signs these trends have

stabilised. However, we know that much still needs

to be done to turn these issues around. We continue

our work to encourage and share best practice

examples with employers to assist them in reducing

workplace illness and injuries.

In relation to the important issue of workplace

health and safety, Comcare will continue to focus

on prevention and voluntary compliance, rather

than punishment after an event. At the same

time, the Australian Government’s decision to

strengthen Comcare’s enforcement powers reflects

an expectation that we will rigorously enforce the

legislation where necessary. We at Comcare believe

that a good health and safety regulator should not

only enforce legislation, but do so in a manner that

is transparent, proportionate and consistent and we

seek to do this as a matter of practice.

These changes have been made to ensure that

Comcare is well placed to meet future challenges

flexibly and responsively. We are already alert to

some of the issues we will need to deal with over

the coming years, including: the evolution of the

regulatory roles we undertake; the changing profile

of the jurisdiction, with an increasing number of

private sector businesses eligible to join the scheme;

and the need to ensure that our people are skilled

and supported to undertake the job ahead.

As well as my role as CEO, (and associated role

with the Safety, Rehabilitation and Compensation

Commission), I have also had the opportunity as a

member of the Australian Safety and Compensation

Council and the Military Rehabilitation and

Compensation Commission to contribute to a

broader leadership, policy and OHS environment

committed to achieving the National OHS Strategy.


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THE DIRECTORMs Barbara Bennett

Chief Executive Officer (CEO)

Ms Barbara Bennett is CEO of Comcare by

appointment under the Safety, Rehabilitation and

Compensation Act 1988. As a consequence, she

is the sole Director of Comcare for the purposes

of the Commonwealth Authorities and Companies

Act 1997 (CAC Act). There is no Comcare ‘Board’.

Ms Bennett was appointed as CEO of Comcare on

5 May 2005. Ms Bennett has some twenty years’

experience in the public sector. Most recently

she worked in the Department of Employment

and Workplace Relations as Group Manager,

Workplace Relations Policy. She had responsibility

for advising the Government on workplace

relations, occupational health and safety and

workers’ compensation policy.

As Comcare CEO, Ms Bennett is ex officio

a member of the Safety, Rehabilitation and

Compensation Commission (the Commission). She

is also the nominee of the Minister for Employment

and Workplace Relations on the Military

Rehabilitation and Compensation Commission

(MRCC) and a member of the Australian Safety

and Compensation Council (ASCC).

PRINCIPAL OFFICELevel 1

14 Moore Street

Canberra ACT 2601

Telephone: 1300 366 979

Facsimile: (02) 6248 0322

Website: www.comcare.gov.au

AUDITORSAustralian National Audit Office

These activities have confirmed for me the important

ongoing work required to prevent workplace injuries,

apply effective regulation and improve compensation

and rehabilitation arrangements for all Australians.

The people who work at Comcare have shown a

great willingness to respond to these changes and

to work with all our clients, both employers and

employees, to ensure that Comcare provides fair and

affordable workers’ compensation and contributes

to improving health and safety outcomes. I would

like to thank all Comcare staff for their hard work,

dedication and professionalism.

Finally I would like to thank the Chairman of

the Safety, Rehabilitation and Compensation

Commission, Mr Les Taylor and Commission

members for their support.

Barbara Bennett

Chief Executive Officer

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COMCARE OVERVIEW

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LEGISLAT IONComcare is a Commonwealth statutory authority

established under the Safety, Rehabilitation and

Compensation Act 1988 (SRC Act) and covered

by the Commonwealth Authorities and Companies

Act 1997 (CAC Act). Comcare administers the

Commonwealth’s workers’ compensation scheme

under the SRC Act and also administers the

Occupational Health and Safety (Commonwealth

Employment) Act 1991 (OHS(CE) Act).

Since October 2005, Comcare has also been

responsible for managing the Commonwealth’s

asbestos-related liabilities under the Asbestos-

related Claims (Management of Commonwealth

Liabilities) Act 2005 (ARC Act) and Asbestos-related

Claims (Management of Commonwealth Liabilities)

(Consequential and Transitional Provisions) Act

2005 (ARC(CTP) Act.

Two amendments to the Occupational Health and

Safety (Commonwealth Employment) Act 1991

(OHS(CE) Act) were tabled in parliament during

2006. The OHS and SRC Legislation Amendment

Bill extends coverage of the OHS Act to all self-

insured licensees under the SRC Act. The Bill will

also change the name of the Act to the Occupational

Health and Safety Act 1991 to reflect its extended

application beyond Commonwealth workplaces. The


Employment) Amendment Bill 2005 requires

employers to develop health and safety management

arrangements in consultation with the employees

and facilitate genuine consultation between

employers and employees.

Comcare provides support to the Seafarers Safety,

Rehabilitation and Compensation Authority

in administering the Seafarers Rehabilitation

and Compensation Act 1992 (Seafarers Act),

the Occupational Health and Safety (Maritime

Industry) Act 1993 (OHS(MI) Act), the Seafarers

Rehabilitation and Compensation Levy Act 1992

(Levy Act) and the Seafarers Rehabilitation and

Compensation Levy Collection Act 1992 (Levy

Collection Act).

Comcare reports to the Minister for Employment and

Workplace Relations, the Hon Kevin Andrews MP,

and in addition to its statutory functions, undertakes

a range of activities under the auspices of the Safety,

Rehabilitation and Compensation Commission.

ROLEComcare works in partnership with its customers to

reduce the human and financial costs of workplace

injuries and disease. Comcare seeks to achieve this

by

• improving the safety and rehabilitation of

employees in the Commonwealth jurisdiction

and the compensation services we provide

• engaging our stakeholders and customers in

achieving that improvement and

• supporting our people to enable them to best

contribute to improving our business.

Comcare undertakes both regulatory and claims

management activities in relation to Commonwealth

employees, in accordance with the SRC Act

and the OHS(CE) Act. A key role undertaken by

Comcare is the setting of workers’ compensation

premiums and occupational health and safety

regulatory contributions for the Australian and ACT

Governments.

Comcare’s regulatory activities cover the workers’

compensation and occupational health and safety

functions for the Commonwealth, Commonwealth

COMCARE OVERVIEW


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Authorities and eligible corporations, as defined by

the legislation. Its claims management functions

cover premium paying agencies, including the ACT

Government, and management of ‘pre-premium’

claims (i.e. claims with a date of injury before July

1989 for the the Australian and ACT Governments,

excluding the Australian Defence Force and licensed

self insurers).

Comcare provides advice to the Minister for

Employment and Workplace Relations on

issues relating to the administration of the

Commonwealth’s occupational health and safety

and workers’ compensation frameworks.

Comcare supports the Safety, Rehabilitation and

Compensation Commission in exercising the

Commission’s functions and powers. Broadly, these

relate to regulation and administration of the SRC

Act and the OHS(CE) Act.

Comcare provides support services to the Seafarers’

Safety, Rehabilitation and Compensation Authority

to assist in the regulation of the Seacare scheme

for workers’ compensation, rehabilitation and

occupational health and safety.

Comcare also has management of common law

injury claims for asbestos related conditions and

diseases against the Australian Government and its

agencies, with certain exceptions.

THE SAFETY , REHABIL ITAT ION AND COMPENSATION COMMISSIONThe Safety, Rehabilitation and Compensation

Commission (the Commission) is established under

the SRC Act. The Commission is a statutory body

with regulatory functions in relation to Comcare

and other authorities which determine workers’

compensation claims under the Commonwealth

scheme. The Commission also has regulatory

functions under the OHS(CE) Act.

The Commission administers the regulatory

functions of the SRC Act and the OHS(CE) Act, other

than those functions ascribed to Comcare.

The major functions of the Commission are to

• provide advice to the Minister in relation to the

SRC Act and the OHS(CE) Act

• develop and implement policy to allow

Commonwealth authorities and eligible

corporations to self-insure and/or to manage

their own claims under licence

• provide strategic direction for occupational

health and safety in the jurisdiction and

ensure compliance with the OHS(CE) Act

• develop general policy direction for

determining authorities on the operation of the

SRC Act

• ensure, as far as practicable, no inconsistency

in the administrative practices and procedures

used by determining authorities and

• act as a review body for premiums and

regulatory contributions.

The SRC Act provides for the Commission to have

eleven members. Each member is appointed by

the Governor-General of Australia. Members other

than the Chairman and Comcare’s Chief Executive

Officer (CEO) may appoint a deputy, subject to

the Minister’s approval. A member, other than

Comcare’s CEO, holds office on a part-time basis for

a term, not longer than three years, specified in the

instrument of appointment. Members are eligible for

reappointment.

In accordance with the SRC Act, Comcare

provides funding and administrative support to the

Commission. The Commission produces a separate

Annual Report that is available on Comcare’s

website at www.comcare.gov.au.

ORGANISAT IONAL STRUCTUREComcare has been structured in such a way as

to recognise its different activities in occupational

health and safety and workers’ compensation.

Comcare’s senior management structure consists of

the Chief Executive Officer, Deputy Chief Executive

Officer and six General Managers. The following

diagram shows the structure as at 30 June 2006.

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DIAGRAM 1 : COMCARE ORGANISAT IONAL STRUCTURE

Minister for Employment and Workplace RelationsThe Hon Kevin Andrews MP

Comcare CEOBarbara Bennett

Safety, Rehabilitation andCompensation Commission

SRC Act Policy and Support

Martin DolanDeputy CEO

Compensation and rehabilitation policy

Scheme funding

Commission secretariat

Licensing of self-insurers

Injury Management

Stewart Ellis

Management of Australian and ACT Government premium claims

Management of Australian and ACT Government pre-premium claims

Provision of rehabilitation/return to work advisory services

Administration of Seacare Scheme

Claims Policy and Systems

Matt Goldrick

Information systems

Operational Policy and support

Fraud control

Compensation payroll

Internal and external review of decisions

Complaints handling and quality assurance

Internal and external training

Transactions

Corporate Management

Penny Weir

People management

Financial management

Records and Mail Centre

National Call Centre

Marketing and communications

Corporate services

Research and Strategy

Jane Romeyn

Research and analysis of emerging issues and jurisdictional performance issues

Strategy development, coordination and evaluation

Monitoring and analysing scheme and agency performance

Management of the Customer Information System

Workplace Health and Safety

Janette Davis

Safety policy and programs

Compliance and enforcement

Communication and coordination

Legal Services

Janean Richards

Legal support services

Management of common law litigation for asbestos related diseases

Defence of common law claims against the Commonwealth

Third party recovery action


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STRATEGIC PLANVision:

Purpose: Work in partnership with our customers

to reduce the human and financial costs

of workplace injuries and disease.

Values: Comcare expects everyone within the

organisation to uphold the APS Value

and the APS Code of Conduct. Within

that framework, we will particularly

• accept responsibility and

accountability for our actions at work

• contribute to the full extent of our

knowledge, skills and abilities, and

acknowledge the effort of others and

• continue to improve the quality

and service orientation of all our

activities.

KEY RESULT AREAS

KRA 1 : IMPROVE THE SAFETY AND REHABIL I TAT ION OF EMPLOYEES IN THE COMMONWEALTH JUR ISD ICT ION AND THE COMPENSAT ION SERV ICES WE PROV IDE .Strategies: Using the full range of Comcare’s

services, develop strategies to

• reduce the number of injuries in

Commonwealth employment

• reduce the time off work for those

who are injured

• develop best practice injury

prevention and management systems

for the Commonwealth

• ensure that long tail claims are

managed effectively.

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Comcare Executive

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KRA 2 : ENGAGE OURSTAKEHOLDERS AND CUSTOMERSIN THE PROCESS OF ACH IEV ING THAT IMPROVEMENT .Strategies: Strategically, using the full range of

Comcare’s services to

• actively work with employers to

implement best practice injury

prevention and management systems

• communicate professionally,

effectively and appropriately with

stakeholders and

• provide high quality injury prevention

and management products including

consultancies, training and systems

improvement tools to improve injury

management within the jurisdiction.

KRA 3 : SUPPORT OUR PEOPLE TO ENABLE THEM TO BEST CONTR IBUTE TO CONT INUOUSLY IMPROV ING OUR BUS INESS .Strategies: Comcare’s People Management

Objective is to attract, develop and retain

the right people and to support them

to ensure they contribute effectively to

continuously improving our business.

The people management priorities for

2005-06 were to

• reduce the human and financial

costs of workplace injury within our

own workplace

• build the culture, work practices and

values at all levels of the organisation

to improve workplace health, safety

and attendance

• ensure that the Performance and

Development Framework (PDF) is

implemented effectively and fairly,

consistent with its objectives and

• improve the effectiveness and

efficiency of merit-based recruitment

and selection processes.

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PERFORMANCE SNAPSHOTS

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TABLE 1 : SRC ACT SCHEME PROF ILE (EXCLUDING L ICENSED SELF INSURERS)

2002-2003 2003-2004 2004-2005 2005-2006

Comcare Insured employees

Australian Government 158,267 160,500 161,027 168,184

ACT 15,852 16,250 17,121 17,291

Total 174,119 176,750 178,148 185,475

Total wage and salary bill - $ million

Australian Government 8,650 9,320 9,903 10,715

ACT 823 916 1,026 1,131

Total 9,473 10,236 10,929 11,846

Total Premium Pool - $ million (1)

Australian Government 97.7 133.5 165.0 189.7

ACT 25.3 28.6 31.5 34.9

Total 123.0 162.1 196.5 224.6

Administration component of premium pool - $ million

13.6 15.9 17.9 23.5

Premium Rate %

Australian Government 1.13% 1.43% 1.67% 1.77%

ACT 3.07% 3.13% 3.07% 3.08%

Average Claim Cost forecast when each pool was calculated

Australian Government $19,295 $22,662 $28,424 $27,960

ACT $27,328 $27,893 $30,175 $31,219

Claims per 100 FTE forecast when each pool was calculated

Australian Government 2.82 3.11 3.14 3.24

ACT 5.31 5.50 5.36 5.55

Estimated outstanding liability at 30 June each year (with risk margin) - $ million (2)

Premiums 787 808 949 1,059

Pre Premiums 606 619 610 504

Total 1,393 1,426 1,559 1,563

PERFORMANCE SNAPSHOTS


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2002-2003 2003-2004 2004-2005 2005-2006

Estimated reserve as at 30 June each year (with risk margin) - $ million

81 107 53 34

Estimated outstanding liability at 30 June each year (without risk margin) - $ million (3)

Premiums 712 730 858 958

Pre Premiums 548 560 551 455

Total 1260 1290 1409 1413

Estimated reserve as at 30 June each year (without risk margin) - $ million

156 184 144 135

Total workers compensation costs - $ million (4)

190.4 197.6 216.2 219Notes

(1) Premium pools include GST.

(2) Outstanding liability estimates include a risk margin of 10.6%. Statutory asbestos claims under the SRC Act where the date of injury has not yet been determined are treated as contingent liabilities, and are not included. Common law asbestos liabilities payable under the ARC Act are also not included.

(3) Outstanding liabilities without risk margin.

(4) Excludes third party recoveries and claims administration costs.

The following graphs show forcasts of the number of claims per 100 full time employees (FTE) and lifetime

average costs for injuries suffered in each year.

Upward trends in the frequency of claims for psychological injuries and payments for time off work

and medical costs increased the forecast average cost of claims. The average lifetime cost of claims for

psychological injuries incurrred in 2005-06 for Australian Government premium paying agencies is forecast

to be around $115,000 if costs for those claims continue the trends of recent years.

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$5,000

0

$10,000

$15,000

$20,000

$25,000

$30,000

2001-2002 2002-2003 2003-2004 2004-2005 2005-20060

6

Forecast average cost of claims Forecast claim frequency

GRAPH 1: FORECAST CLAIM FREQUENCY AND AVERAGE COST – AUSTRALIAN GOVERNMENT

Year

Fore

cast

ave

rage

co

st o

f cl

aim

sFo

recast claim freq

uen

cy per 100 F

TE

$35,000

1

2

3

4

5

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Upward trends in the frequency of claims for psychological injuries, and payments for time off work and

medical costs also increased the forecast average cost of claims for the ACT Government. The average

lifetime cost of claims for psychological injuries incurred in 2005-06 for the ACT Government is forecast to

be around $80,000 if costs for those claims continue the trends of recent years.

Note: Tables 2 and 4 classify injuries by ‘mechanism of incident’ and ‘nature of injury/disease’ using

the Type of Occurrence Classification System, 3rd Edition (National Occupational Health and Safety

Commission, March 2004). The mechanism of incident is intended to identify the mechanism or process

that best describes the circumstances in which the injury/disease occurred while the nature of injury/disease

is intended to identify the type of hurt or harm that occurred. Thus (in this report and in other publications

and information material), mental stress is a mechanism of incident that can result in mental disease such

as psychological injury .

$5,000

0

$10,000

$15,000

$20,000

$25,000

$30,000

2001-2002 2002-2003 2003-2004 2004-2005 2005-20060

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Forecast average cost of claims Forecast claim frequency

GRAPH 2: FORECAST CLAIM FREQUENCY AND AVERAGE COST – ACT GOVERNMENT

Year

Fore

cast

ave

rage

co

st o

f cl

aim

sFo

recast claim freq

uen

cy per 100 F

TE

$35,000

1

2

3

4

5

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TABLE 2 : WHAT CAUSES IN JUR IESThe following table identifies the causes of injury and disease for claims accepted by Comcare with a date

of injury in 2005-06. While representing a relatively low percentage of claims, mental stress accounted

for almost 20 per cent of total claims cost. The majority of claims resulted from body stressing injuries (i.e.

muscular stress associated with manual handling, as well as repetitive movement) and falls, trips and slips.

Comcare has developed guidance material for employers to assist them in preventing these types of injuries.

Mechanism (i.e. cause) of incident Percentage of claims Percentage of total cost**

Body stressing 42.5 43.5

Falls, trips & slips of a person 22.0 17.4

Other & unspecified mechanisms of incident* 15.4 11.6

Being hit by moving objects 8.0 5.0

Hitting objects with a part of the body 4.8 2.2

Mental stress 4.4 19.8

Chemicals & other substances 1.4 0.3

Heat, electricity & other environmental factors 0.7 0.1

Sound & pressure 0.6 0.1

Biological factors 0.2 0.0

* Includes motor vehicle accidents

** Total cost represents cost to date (money already paid on claims) and an estimate of future liabilities

TABLE 3 : WHEN IN JUR IES OCCURThe SRC Act provides workers’ compensation coverage for injuries sustained by employees in the course

of their employment – (including during normal work breaks, travelling between their work and home and

while travelling on an approved work activity). The following table analyses claims accepted by Comcare

with a date of injury in 2005-06 by duty status. This shows that while the majority of injuries and diseases

still occur in the workplace and account for over 80 per cent of the total cost, a significant proportion of

injuries occurred while travelling to or from work.

Duty status Percentage of claims Percentage of total cost*

Working at usual workplace 73.3 80.9

While travelling to/from work 14.7 11.0

While working elsewhere 3.6 2.2

During authorised sport 2.1 1.2

While having a break 2.1 2.0

Traffic accident while working 0.8 0.6

While attending approved study 0.6 0.6

Other (incl. home based work) 2.6 1.6

* Total cost represents cost to date (money already paid on claims) and an estimate of future liabilities

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TABLE 4 : NATURE OF IN JUR IES/D ISEASESThe following table identifies the nature of injury and disease for claims accepted by Comcare with a date

of injury in 2005-06. It shows that the majority of claims in 2005-06 were for injuries, with 51 per cent

for traumatic joint/ligament and muscle/tendon injuries. Diseases of the musculoskeletal system were the

predominate cause of claims for work-related diseases. Claims involving mental disorders remain costly in

relation to the low number of claims made.

Nature of injury/disease Percentage of claims Percentage of total cost**

Traumatic joint/ligament and muscle/tendon

injury51.2 38.9

Wounds, lacerations, amputations and internal

organ damage9.0 2.4

Fractures 6.7 8.4

Other injuries* 2.7 2.2

Musculoskeletal and connective tissue diseases 21.1 22.7

Mental diseases 4.2 20.6

Nervous system and sense organ diseases 2.2 2.6

Other diseases* 2.6 2.1

Other claims 0.1 0.0

* Other injuries/other diseases include nature of injury/disease groups where the percentage of claims was <1%

** Total cost represents cost to date (money already paid on claims) and an estimate of future liabilities

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STRATEGIC IN IT IAT IVES

KRA 1 : IMPROV ING THESAFETY AND REHABIL I TAT ION OF EMPLOYEES AND THECOMPENSAT ION SERV ICES WEPROV IDEA cornerstone of the scheme administered by

Comcare is the recognition of the importance

of an integrated approach to health and safety,

rehabilitation and compensation policies and

processes within workplaces. The proper interaction

of these elements helps to minimise the incidence

and duration of work-related injury.

ACT IV I TY• Promoted senior management commitment to

safe and healthy workplaces.

• Reviewed audit and assessment approaches

for OHS and RTW management systems.

• Researched ‘body stressing’ injuries as a major

cause of work related injuries.

• Completed implementation of the

psychological injury strategy.

• Continued with the interagency job placement

program.

LEADERSHIP AND ACCOUNTAB IL I TY STRATEGY

SAFETY LEADERSHIP

In 2005-06 Comcare continued to implement the

Leadership and Accountability Strategy. The focus

of this strategy is to improve senior management

commitment to safe and healthy workplaces in

Australian and ACT Government agencies. A key

message of the strategy is that the prevention and

management of workplace injury and illness must

be integrated into human resource management,

REPORT OF OPERATIONS

risk management and corporate planning, making it

an integral part of day-to-day business.

As previously reported, Comcare managed a project

on behalf of the National Occupational Health and

Safety Commission to improve safety leadership in

government workplaces and to progress ‘National

Priority 5’ under the National OH Strategy 2002–

2012. The project, developed in consultation

with state and territory jurisdictions, resulted in

the report Safe and Sound: a discussion paper

on safety leadership in government workplaces.

In May 2005, the Workplace Relations Ministers’

Council agreed to the framework and associated

recommendations identified in the Safe and Sound

paper. In July 2005, the National Occupational

Health and Safety Commission (NOHSC) agreed to

an implementation action plan to give effect to the

Safe and Sound recommendations.

Implementation of the action plan is being

coordinated by the Office of the Australian Safety

and Compensation Council (OASCC), with Comcare

playing a leading role in relation to employers within

its jurisdiction.

The Australian Safety and Compensation Council

(ASCC) is the successor organisation to NOHSC. The

action plan covers a range of activities including

• distribution of the Safe and Sound paper and

the preparation of other guidance material

• information sessions for leaders

• the promotion of target setting in line with the

National OHS Strategy

• benchmarking best practice strategies across

and within jurisdictions

• reporting public sector performance to improve

accountability and

• establishing national public sector awards to


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encourage and reward excellence in OHS and

injury management in the public sector.

To support the action plan the Safety, Rehabilitation

and Compensation Commission’s Safety Awards

have been aligned with the new National Safe

Work Australia Awards. This will enable winners

in relevant Commission award categories to be

nominated for the national awards and demonstrate

how Australian Government employers are

contributing to national objectives.

TARGET SETT ING

The promotion of target setting is a key activity

under Comcare’s Leadership and Accountability

Strategy. The targets are linked to the National OHS

Strategy, but for premium-paying organisations, are

reinforced by two additional rehabilitation targets.

The four targets are to

• reduce the incidence of workplace injuries and

diseases by 40 % by 2012

• eliminate all fatalities due to workplace injury

• reduce the average lost time rate by 40 % by

2012 and

• reduce the average time taken for rehabilitation

intervention by 90 % by 2012.

As at 30 June 2006, 54 premium paying employers

had signed a ‘statement of commitment’ (see Table

5). Based on full time equivalent (FTE) employee

data, this group of employers covers more than

83% of the workforce employed by Australian

Government premium-paying employers.

In implementing target setting, employers have been

encouraged to monitor their performance using their

data available through Comcare’s on-line Customer

Information System (CIS) and to report their

performance in their annual reports.

TABLE 5 : L IST OF EMPLOYERS WHICH HAVE S IGNED A ‘STATEMENT OF COMMITMENT ’ AS AT 30 JUNE 2006

Aboriginal Hostels Limited

Airservices Australia

Army & Air Force Canteen Service

Australian Broadcasting Commission

Australian Bureau of Statistics

Australian Crime Commission

Australian Customs Service

Australian Electoral Commission

Australian Federal Police

Australian Industrial Registry

Australian Institute of Aboriginal and Torres Strait Islander Studies

Australian Institute of Marine Science

Australian Maritime Safety Authority

Australian National Audit Office

Australian National University

Australian Nuclear Science and Technology Organisation

Australian Pesticides and Veterinary Medicines Authority

Australian Prudential Regulation Authority

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Australian Public Service Commission

Australian Reinsurance Pool Corporation

Australian Research Council

Australian Securities and Investments Commission

Australian Taxation Office

Australian Trade Commission

Centrelink

Civil Aviation Safety Authority

Comcare

Commonwealth Ombudsman

Commonwealth Scientific and Industrial Research Organisation

Comsuper

Defence Housing Authority

Department of Agriculture Fisheries and Forestry

Department of Defence

Department of Education, Science and Training

Department of Employment and Workplace Relations

Department of Family, Community Services and Indigenous Affairs

Department of Finance and Administration

Department of Foreign Affairs and Trade

Department of Health and Ageing

Department of Human Services (including CRS Australia and Child Support Agency)

Department of Industry Tourism and Resources

Department of Parliamentary Services

Department of the Senate

Department of Transport and Regional Services

Department of Veterans’ Affairs

Family Court of Australia

Federal Magistrates Court of Australia

Great Barrier Reef Marine Park Authority

Medicare Australia

Human Rights and Equal Opportunity Commission

National Library of Australia

Private Health Insurance Administration Council

Professional Services Review

Torres Strait Regional Authority


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As previously reported, in February 2004 the Chief

Minister of the ACT, Mr Jon Stanhope, launched

‘Workplace Injury Improvement Targets’ for the ACT

public sector, a strategy which adopted the four

targets mentioned earlier in this section for ACT

Government employers.

REV IEW OF SELF-ASSESSMENT TOOLS FORRETURN TO WORK MANAGEMENT SYSTEMSThe SRC Act provides for the safety, rehabilitation

and compensation of employees injured or ill as

a result of their employment. It gives employers

responsibility for and authority to manage the

rehabilitation and return to work of their injured

employees.

Comcare’s Return to Work Management Systems

Self Assessment Tool (RTW self assessment tool)

was developed under Comcare’s Leadership and

Accountability Strategy. The tool is designed to

assist employers to review their RTW management

systems and establish benchmarks for improvement.

It is based on the Victorian Workcover Authority’s

InjuryMAP.

In 2005-06, Comcare undertook a review of the

RTW self assessment tool. The aim of the review

was to consider its application and usefulness.

It was also to identify improvements to assist

employers with implementation and to ensure

consistency with revised SRC Act Section 41

guidelines issued by Comcare during the year.

The revised guidelines set out the basis on which

employers must meet their responsibilities as

rehabilitation authorities.

The review highlighted the need for a range of

guidance materials and tools to assist employers at

different levels of maturity in their RTW compliance

and management systems implementation. To

meet this need, Comcare commenced work on

a new systems improvement tool. This tool will

complement the existing audit tool, but will provide

employers with guidance on improving core aspects

of their RTW management systems. The project is

due for completion in 2006-07.

BODY STRESS ING RESEARCHA key driver of claims costs over recent years

has been injured employees staying off work

for longer periods. Comcare undertook research

to better understand how claims management

and rehabilitation processes were being applied

and how such processes might be improved

to reduce the duration of time off work. ‘Body

stressing’ claims were selected as the focus for the

research, as these claims are a significant driver

of workers’ compensation costs for Australian and

ACT Government agencies. Body stressing is also

a significant mechanism of injury for self-insured

licensees. Such claims cover a range of muscular

and soft tissue injuries to different parts of the body.

SANO Consulting (SANO) was engaged to review

a sample of body stressing claim files, data reports

and Comcare systems and processes. SANO also

met or conducted structured telephone interviews

with key stakeholders.

The resulting report, Comcare Body Stressing

Claims Review 2005, found that in many cases,

time off work for body stressing claims is extending

beyond the normal recovery period of 6 –12 weeks

for such injuries, including cases where the initial

injury was apparently minor.

The report highlighted that opportunities for

early recovery were being missed due to delays

in providing rehabilitation assistance to injured

employees. In some cases, assistance is not being

provided until after the normal recovery period for

the injury.

A growing body of international research has shown

that personal and environmental factors are more

important predictors of delayed recovery than

medical or physical factors relating to the nature

of the injury. These predictors of delayed recovery

include psychosocial factors, perceived features

of the work and social environment and certain

employment policies and practices. However, SANO

found that non-medical factors were generally not

well addressed in rehabilitation assessment and

planning. This problem was compounded by a

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lack of structured communication and collaborative

problem solving by stakeholders.

Further work has been undertaken in 2005-06 to

progress the SANO recommendations. The findings

of the report and their implications were also

the focus of Comcare’s 2005 National Customer

Seminars.

PSYCHOLOGICAL IN JURY STRATEGYA key contributor to the level of premiums in recent

years has been increased numbers and costs of

accepted claims for psychological injury. These

claims generally involve extended periods of time off

work and higher medical, legal and other payments

than for other types of claims.

In response to the rising costs of these claims,

Comcare implemented a Psychological Injury

Strategy, commencing in 2004-05. This strategy

has delivered a number of significant initiatives

to improve the prevention of injury and the

management of claims.

Key elements have included

awareness raising targeted at agency heads,

corporate managers and line managers

advisory assistance to employers

development of guidance on model

approaches to prevention and early

intervention (Working Well: An organisational

approach to preventing psychological injury)

and

the development of training programs to

assist line managers to implement effective

prevention and early intervention strategies.

Over the course of 2005-06, advice and support

has been provided to employers through Comcare’s

OHS helpline, presentations, briefings, conferences

and through Comcare’s Whole of Agency strategy.

Comcare’s online information portal continues to

provide easy access to a range of information, and

practical advice on this issue and includes links

to key international and Australian research and

publications.

During 2005-06, Comcare commenced work

to improve the capacity of its OHS investigation

program to address claims of bullying and

harassment (reported at Output 1.2 OHS(CE) Act

Regulation).

Psychological injury claim numbers appear to

have stabilised, but it is too early to suggest they

are in decline. Psychological injury will continue

to be a priority for Comcare because of the high

cost of these injuries to individuals and employers.

While key elements of the strategy have now been

implemented, it remains to be seen whether, and to

what extent, employers will continue to implement

the approaches advocated through information

sessions and guidance material. The psychological

injury strategy will be evaluated in 2006-07.

INTERAGENCY JOB PLACEMENT PROGRAMThe Interagency Job Placement Program (IJPP)

which commenced in March 2005 continued

throughout the 2005-06 financial year. IJPP

provides a forum for participating Australian

Government employers to explore alternative

employment opportunities for injured employees

on workers’ compensation who can not return to

their previous place of work or employer. Network

groups operate in all mainland states and are

locally coordinated by representatives of Australian

Government employers. Comcare continues to

provide strategic support nationally.

KRA 2 : ENGAGING OURSTAKEHOLDERS AND CUSTOMERSDuring 2005-06 Comcare continued its

commitment to work in partnership with employers

and stakeholders to achieve improvements in injury/

disease prevention and management. Comcare

has a key role in raising awareness of current and

emerging issues and influencing outcomes.

ACT IV I TY• 2005 Comcare National Rehabilitation

Conference

• Whole of Agency Strategy

• Customer Seminars


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• External training

• Commonwealth Compensation Liaison

Committee

• Licensee/Comcare Consultative Forum

• Customer Information System User Group and

• National Public Sector Injury Prevention and

Management Forum.

2005 COMCARE NAT IONAL REHABIL I TAT ION CONFERENCEIn November 2005, Comcare’s third National

Rehabilitation Conference was held in Canberra.

The conference theme was Early Intervention

– the key to prevention and management of

workplace injuries. The conference was fully

subscribed and attended by 280 delegates from

both the public and private sectors. Presentations

focussed on the benefits of early intervention in

response to workplace injury and as a mechanism

for claim prevention. A fourth National Comcare

Rehabilitation Conference is scheduled for the

2007-08 financial year.

WHOLE OF AGENCY STRATEGYDuring 2005-06 Comcare continued to work with a

range of medium and large Australian Government

employers. The aim was to assist these employers to

develop and implement effective, targeted strategies

to reduce the number and duration of their workers’

compensation claims and to reduce the direct and

indirect costs of their work related injuries and

illnesses.

Comcare met regularly throughout the year

with senior managers from these employers to

review their data and progress in developing and

implementing injury prevention and management

strategies.

CUSTOMER SEMINARSIn 2005-06, Comcare convened two rounds of

customer seminars nationally, one in October 2005

and the other in May 2006. This year, customer

seminars moved away from traditional presentations

towards more practical workshops. The themes of

these workshops included risk management, early

intervention and practical solutions to preventing

and managing body stressing injuries.

EXTERNAL TRA IN INGComcare delivered an extensive range of learning

and development programs to Australian and ACT

Government employers, service providers and self-

insurers during 2005-06.

Supporting its vision of Australia’s Safest

Workplaces, Comcare expanded its suite of

development programs with the introduction of

• Creating a Healthy Workplace

• Introduction to OHS in Contracting

• Making the Most of Your Influencing Skills and

• Update for Experienced Approved

Rehabilitation Program Providers.

Over 1,700 participants attended training programs

delivered by Comcare during 2005-06. This was

an increase on the number of participants attending

Comcare courses over the previous twelve months. It

is indicative of the value employers and employees

place on these practical training programs which are

tailored to meet employers’ specific injury prevention

and management needs.

A calendar detailing the full range of programs and

activities is available on Comcare’s website at www.

comcare.gov.au.

COMMONWEALTH COMPENSAT ION L IA ISON COMMITTEEThe Commonwealth Compensation Liaison

Committee (CCLC) was established by Comcare

in 2003-04. The CCLC provides an avenue for

communication between plaintiff lawyers, Comcare,

Comcare’s legal panel members and licensed self

insurers amongst others on a wide range of legal

issues arising from the operation of the SRC Act.

In 2005-06, Comcare used the CCLC as an avenue

for consultation on the implementation of the

Second Edition of the Guide to the Assessment of

the Degree of Permanent Impairment under the

SRC Act.

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L ICENSEE/COMCARE CONSULTAT IVE FORUMThe Licensee/Comcare Consultative Forum

(LCCF) is one of the established mechanisms for

communication between licensed self insurers

(licensees) and Comcare (in its role of assisting the

Commission).

Forums are generally held following meetings of the

Commission to allow discussion of the outcomes of

these Commission meetings and to provide Comcare

with the opportunity to seek input from licensees on

future Commission agenda issues.

The LCCF is also used to identify and discuss

particular items or issues relating to the regulation

of self insurance under the SRC Act. This may result

in additional meetings with licensees and/or the

establishment of working parties to progress such

matters.

During 2005-06, the LCCF met four times. In

addition, Comcare organised a Licensee/Comcare

business planning meeting on 14 July 2005. One of

the outcomes of this meeting was the formation of

several joint working parties, the aims of which were

to progress and finalise components of a regulatory

review of self insurance arrangements under the

SRC Act.

CUSTOMER INFORMAT ION SYSTEM USER GROUPComcare’s Customer Information System (CIS)

provides employers with access to on-line claims

data and reporting mechanisms. Through CIS,

customers can measure and monitor their injury

management and claims performance.

The Customer Information System User Group

(CISUG) was established as a forum for customers

to provide feedback to Comcare on CIS. The CISUG

enables Comcare to gauge the functionality of CIS

and to develop ways to improve the service and

information CIS provides to the customers.

The first meeting of the CISUG was held in July

2005. Members recognised the benefits of the

forum and agreed to conduct future meetings

on a quarterly basis. In conjunction with the

establishment of the CISUG, a CIS Bulletin was

developed as a means of conveying information

to all CIS users. The Bulletin is distributed

quarterly and includes information on planned

enhancements, tips and hints and answers to

frequently asked questions.

NAT IONAL PUBL IC SECTOR INJURY PREVENT ION AND MANAGEMENT FORUMComcare participates in the National Public Sector

Injury Prevention and Management Forum to share

strategic initiatives with other Australian jurisdictions

and to engage in benchmarking of agreed strategies

and initiatives.

KRA 3 : SUPPORT ING OUR PEOPLE

INVEST ING IN OUR PEOPLEComcare has continued to provide a supportive work

environment through a range of people management

initiatives and activities with a view to motivating its

staff and continuously improving its business.

ACT IV I TYThe activities outlined below are organised against

the Best Practice framework of

• Leadership

• Organisational development

• Recruitment and selection

• Employee relations

• Performance management

• Learning and development and

• Organisational health and wellbeing.

LEADERSHIPComcare recognises the importance of leadership

capabilities such as innovation, flexibility,

collaboration, ongoing learning and the capacity

to respond quickly to change. It encourages the

development of these capabilities through leadership

training and the operation of the Comcare Executive

Leadership Team (ELT). The ELT has a key role

in building a supportive organisational culture and

fostering leadership at all levels. This is achieved

through improving coordination and integration

across functional areas and locations, achieving a


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shared understanding of the organisation’s purpose

and directions, undertaking and evaluating progress

with strategic initiatives and forecasting and

responding to emerging issues.

ORGANISAT IONAL DEVELOPMENT

PEOPLE MANAGEMENT COMMITTEE

The People Management Committee (PMC) advises

Comcare Executive on strategic people management

issues within the organisation.

Key issues taken forward by this committee in

2005-06 included Attendance Management and the

OHS Management System.

STAFF SURVEY

On 11 April 2006 Hinds Workforce Research, on

Comcare’s behalf, conducted a survey of Comcare’s

staff to allow Comcare to assess the motivation and

satisfaction of its employees. The survey achieved a

97% response rate. Action plans will be developed

in 2006-07 to address areas highlighted by the

survey.

RECRUITMENT AND SELECT IONDuring 2005-06, Comcare continued to recruit at

all job levels. Ninety four new ongoing and non-

ongoing staff were appointed in 2005-06.

EMPLOYEE RELAT IONSComcare’s staff-management consultative forum,

the Comcare National Consultative Committee

(CNCC) met in December 2005 and May 2006 and

discussed a range of staff concerns, particularly the

attendance policy and recruitment.

AGREEMENT MAK ING

Comcare’s current Certified Agreement

2005-07 (CA) was made under section 170LK of

the Workplace Relations Act 1996 and certified by

the Australian Industrial Relations Commission on

30 June 2005 and will remain in force until June

2007.

As at 30 June 2006 a total of 73 Comcare staff

(20%) were covered by AWAs, including SES and

EL2 staff and the majority of EL1 staff.

FLEX IBLE WORK ING ARRANGEMENTS

Comcare’s CA provides a range of flexible working

arrangements and conditions to support employees

in achieving an appropriate work/life balance. At 30

June 2006, 44 staff (11%) worked part-time. Seven

staff (2%) used purchased leave arrangements. Staff

were also encouraged to make use of home-based

work and other employment flexibilities to enhance

organisational effectiveness.

Comcare’s Carer’s Room policy was revised and the

facility revitalised to a more child-friendly, work-

friendly environment, assisting employees to achieve

a better balance between work and their caring

responsibilities.

PERFORMANCE MANAGEMENTThe key feature of the CA is a continued focus on

the Performance Development Framework (PDF)

as a means of aligning individual efforts and

organisational goals.

Managers at all levels in Comcare are accountable

for implementation of the PDF and compliance

with the different phases of the PDF cycle. A PDF

assessment rating of at least satisfactory is required

for pay-point advancement within a classification

level under the current CA and a salary increase

under the CA and individual AWAs.

LEARNING AND DEVELOPMENTComcare’s framework for managing learning and

development is built on seven principles

• aligning learning with our business

• integrating learning with HR and business

processes

• creating a learning culture

• providing a range of appropriate learning

options

• managing learning effectively

• supporting the application of skills in the

workplace and

• evaluating learning and development.

These principles are given effect through the

PDF to ensure that individual learning needs are

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met. Training programs were delivered through

a range of mechanisms including in-house and

external providers. During 2005-06, Comcare’s

staff completed 14,662 hours of focused learning

and development activities. This equates to

approximately 5.5 training days per person

excluding studies assistance.

Training programs included

• OHS Legislative Training Program

• SRC Act Legislative Training Program

• Leading by Learning (APS5-EL1)

• Leading by Learning – Diploma of Business

(Frontline Management)

• Foundation Program Certificate IV in

Government

• Corporate Induction for new employees

• Graduate Development Program.

STUDIES ASS ISTANCE

Comcare actively supports continued learning

through its Studies Assistance Policy. During

2005-06, 26 staff undertook additional study in a

range of areas relevant to Comcare’s business.

GENERAL LEARNING STRATEG IES

Comcare also provided staff with access to a

range of other development activities designed to

meet individual and group learning needs during

2005-06.

OCCUPAT IONAL HEALTH AND SAFETYComcare’s OHS Agreement sets out responsibilities

for maintaining a safe and healthy work

environment. It provides the basis for continuing

consultation on occupational health and safety

matters between Comcare and its employees,

including through a National OHS Committee.

Comcare reviewed its health and safety

management arrangements in the light of

developments with the Occupational Health and

Safety (Commonwealth Employment) Amendment

Bill 2005, introduced into Parliament on 23 June

2005. As a part of this, Comcare’s internal auditor

conducted an audit of Comcare’s OHS Framework.

The audit found that there were no issues of non-

compliance and that Comcare had adequate policies

and procedures in place in respect of the health and

safety of its staff.

A series of toolbox sessions were held to familiarise

staff with ‘Sign-on’ (see below).

S IGN-ON

Comcare’s ‘Sign On’ intranet site is based on the

Commission’s Risk Management Model and is

designed to provide information about the six

elements of that model, namely

• senior management leadership and

commitment

• active involvement of individuals in the

workplace

• effective communication through consultation

• provision of appropriate information, education

and training Hazard identification, risk

assessment and risk control and

• OHS management information systems.

The ‘Sign-On’ site is a portal for staff to access

information about Comcare’s OHS Management

System.

ABSENCE MANAGEMENT AND THE ACT ION PLAN FORIMPROVED SAFETY AND ATTENDANCE

Following a series of discussions with staff of

Comcare conducted by the Chief Executive Officer

during July and August 2005, an Action Plan for

Improved Safety and Attendance was developed and

circulated to all staff.

Absence management has been a focus of all people

management activities and unscheduled absence

data was regularly reported to the Executive.

HEALTH AND WELLBE ING

Comcare continued to implement its Health and

Wellbeing strategy which focuses on three areas

• educating staff and motivating them to take

responsibility for their own health

• identifying a range of physical and social

activities and encouraging and supporting

participation in those activities and


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• providing facilities, incentives and financial

assistance where appropriate to further assist

staff to maintain a healthy lifestyle.

HEALTH AND SAFETY REPRESENTAT IVES

Under Comcare’s OHS Agreement, there are three

designated work groups in Comcare covering

Canberra, Melbourne and NSW/SA/Qld. Each

designated work group has a Health and Safety

Representative (HSR) and Deputy HSR.

WORKPLACE INC IDENTS

Two incidents were notified under section 68 of the

OHS(CE) Act.

PREVENT ION

In the light of Comcare’s workers’ compensation

injury profile, a high priority in 2005-06

was targeting the prevention of occupational

overuse injuries. Comcare’s focus is on creating

a performance and safety culture, with staff

encouraged to take greater responsibility for their

own health and safety. Accountability for this is

included in AWAs and IAPs.

The development of risk assessments and

management of unscheduled absences have been

used to address these issues. Comcare continued to

raise awareness of potential injury risk factors and to

encourage early incident reporting and rehabilitation.

INVEST IGAT IONS UNDER S74(1 ) (F ) OF THE OHS(CE)ACT 1991

No investigations were conducted under the

OHS(CE) Act in 2005-06 in relation to Comcare’s

undertakings.

WORKPLACE HARASSMENT POL ICY AND CONTACT OFF ICERS

In 2005-06, information sessions on Comcare’s

workplace harassment policy and guidelines were

offered to managers and team leaders.

The policy and guidelines establish preventative

measures designed to reduce the incidence of

harassment and bullying. They include

• education, training and awareness through

a number of learning and development

programs, and information on Comcare’s

Intranet including the screening of a video on

bullying to trigger team discussions

• procedures for Resolving Workplace Issues that

are relevant to handling any type of workplace

grievance

• staff support mechanisms through the

Harassment Contact Officers Network,

Employee Assistance Program and the Human

Resources Group

• management accountability and individual

responsibility in the CA and AWAs

• monitoring and responding and

• investigation of allegations.

Harassment Contact Officers are provided with

appropriate training with refresher training provided

where necessary.

EMPLOYEE ASS ISTANCE PROGRAM

Employment Assistance Program services continued

to be well utilised by staff for both work-related and

non-work related issues. Comcare receives quarterly

reports on the use of the program, the results of

which are made available to and discussed by the

People Management Committee, OHS Committee

and CNCC.

WORKPLACE D IVERS ITYComcare has a Workplace Diversity program in

place for 2004-08, the objectives of which are to

• increase awareness of diversity principles

amongst all staff and assist them in meeting

the objectives of the program

• reinforce the APS and Comcare values relating

to diversity through recruitment and selection

practices, learning and development programs,

performance and development framework and

other HR policies and guidelines

• encourage and support a workplace

environment that is flexible, satisfying and

rewarding and

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• bring about positive attitudes to diversity and

increase accountability for practicing diversity

in the workplace.

Some key initiatives in 2005-06 included the

introduction of Workplace Diversity information

sessions for new staff and participation in the

Australian Public Service Commission’s Indigenous

Cadetship and Graduate recruitment programs.

A range of activities were also organised to celebrate

events such as International Women’s Day and

NAIDOC Week.

REWARD AND RECOGNIT IONUnder Comcare’s reward and recognition program,

Comcare’s Executive considers nominations against

a set of criteria. Awards were made throughout

2005-06 to many individuals and teams. All awards

are published in the internal staff bulletin and on

Comcare’s Intranet.

In January 2006, Australia Day Medals were

awarded to

• Comcare’s Recordkeeping Unit (Brian Bourne

and Gwenda Morrison) for modernising

Comcare’s Recordkeeping system, bringing it

to a level consistent with National Archives

of Australia requirements, and enhancing

Comcare’s efficiency

• SRC Secretariat (Jackie Cody and Maree

Sherwood) for organising the Commission’s

Safety Awards, and enhancing Comcare’s

reputation with the Commission and its

customers

• Anne Laisk for her significant contribution to

the Australian Public Service and in particular

to Comcare where she was responsible

for many corporate initiatives and policies,

particularly in the areas of Performance

Management, Occupational Health & Safety

and Recruitment and Selection

• Toni Diehm for improving Comcare’s claims

management systems and services and

managing her teams so they were professional,

positive and productive, and

• John Dann for his outstanding contribution

to the organisation over many years and

demonstration of Comcare’s value of accepting

responsibility and accountability for his actions

at work.

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PERFORMANCE AGAINST OUTPUTS

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COMCARE’S OUTCOME ANDOUTPUTS FRAMEWORKThe 2005-06 Portfolio Budget Statements (PBS)

define Comcare’s outcome as to

‘Minimise human and financial costs of workplace

injury under schemes administered by Comcare

and ensure that claimants receive compensation in

accordance with Commonwealth obligations.’

Comcare achieves this by

• improving the safety and rehabilitation of

employees in the Commonwealth jurisdiction

and the compensation services we provide

• engaging our stakeholders and customers in

achieving that improvement and

• supporting our people to enable them to best

contribute to improving our business.

PERFORMANCE AGAINST OUTPUTS

The key priorities for Comcare in 2005-06 were

• ensuring the continued financial viability of the

premium scheme

• ensuring active and effective management of

claims, including in relation to any movement

in claims costs due to changing claim profiles

and

• continuing to improve health and safety in

the jurisdiction by active regulation and by

encouraging appropriate prevention and return

to work activities.

In October 2005 Comcare reviewed its outcome

and output framework to reflect the Australian

Government’s decision to centralise in Comcare the

management of common law injury claims against

the Australian Government and its agencies for

asbestos related conditions. Comcare has added

Output 1.6 ‘management of asbestos related

personal injury common law disease claims

against the Commonwealth’ to recognise Comcare’s

additional function.


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RESOURCES FOR OUTCOMETable 6 shows the total resourcing for the outcome, including

• total administered revenue

• revenue from Government (appropriation) for outputs

• revenue from other sources and

• total price of outputs less administered revenue.

Outcome 1Minimise the human and financial costs of workplace injury under schemes administered by Comcare and

ensure that claimants receive compensation in accordance with Commonwealth obligations

Output 1.5Seafarers' Act Regulation

Output 1.6Management of asbestos related personal injury common law disease claims against the Commonwealth

Output 1.4Management of

Pre -premium Claims

Output 1.2OHS(CE) Act regulation

Output 1.3Management ofPremium Claims

Output 1.1SRC Act regulation

DIAGRAM 2 SHOWS THE RELAT IONSHIP BETWEEN THE OUTCOME AND THE CONTR IBUT ING OUTPUTS FOR COMCARE .

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TABLE 6 : TOTAL RESOURCES FOR OUTCOME

Outcome 1: Minimise human and financial costs of workplace injury under schemes administered by

Comcare and ensure that claimants receive compensation in accordance with Commonwealth obligations.

(1) (2) (2) - (1)

Budget# Actual

expenses

Variation Budget

2005-06 2005-06 2005-06 2006-07

$’000 $’000 $’000 $’000

Administered expenses

to Special Account for Seafarers’ Rehabilitation

and Compensation

298 95 (203) 222

Total administered appropriations 298 95 (203) 222

Price of Departmental Outputs

Output Group 1.1 - SRC Act Regulation 3,676 3,547 (129) 4,225

Output Group 1.2 - OH&S(CE) Act Regulation 7,496 7,489 (7) 8,676

Output Group 1.3 - Management of premium

claims

200,918 188,013 (12,905) 201,734

Output Group 1.4 - Management of pre-premium

claims

61,379 55,276 (6,103) 59,412

Output Group 1.5 – Seafarers’ Act Regulation 421 421 - 426

Output Group 1.6 - Management of

asbestos-related diseases

18,817 7,743 (11,074) 22,797

Subtotal output group 292,707 262,489 (30,218) 297,270

Total revenue from government (appropriations)

Revenue from Government (Appropriation) for Departmental Outputs

Output Group 1.1 - SRC Act Regulation - - - -

Output Group 1.2 - OH&S(CE) Act Regulation 341 341 - 300

Output Group 1.3 - Management of premium

claims

- - - 0


claims

61,379 55,276 (6,103) 59,412

Output Group 1.5 – Seafarers’ Act Regulation 421 421 - 426

Output Group 1.6 - Management of asbestos-

related diseases

13,782 5,234 (8,548) 22,797

Subtotal output group 75,923 61,272 (14,651) 82,935


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Outcome 1: Minimise human and financial costs of workplace injury under schemes administered by

Comcare and ensure that claimants receive compensation in accordance with Commonwealth obligations.

Revenue from other sources

Workers compensation premiums 208,654 212,177 3,523 196,768

Regulatory Contributions 8,300 8,286 (14) 8,900

Dividends 200 - (200) -

Interest 7,000 9,244 2,244 9,000

Licence fees 2,572 2,586 1 3,700

Miscellaneous 5,522 3,963 (1,546) 498

Total revenue from other sources 232,248 236,256 4,008 218,866

Total price from departmental outputs (15,464) (35,039) (19,575) (4,531)

TOTAL FOR OUTCOME 1 (15,166) (34,944) (19,778) (4,309)

2005-06 2005-06 Variation 2006-07

Average staffing level (number) 370 374 4 374

Funding related to non cash movements in the net outstanding claims liabilities (based on actuarial

assessments as at 30 June 2006) are not included in the above figures. The movement is

Output Group 1.3 - Management of premium claims 55,300 99,820 44,520 61,400


claims

(35,700) (46,600) (10,900) (34,600)

Output Group 1.6 - Management of asbestos-

related diseases

(305,400) 51,700 357,100 -

Total (285,800) 104,920 390,720 26,800

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FINANCIAL PERFORMANCEComcare is a body corporate with reporting and

accountability responsibilities in accordance with the

CAC Act.

In the 2005-06 financial year some 60% of

Comcare’s revenue was from cost recovered services

(primarily workers’ compensation premiums,

regulatory contributions, and licence fees) with the

remaining revenue provided through Government

appropriations.

The most significant financial issues during the year

related to

• the impact of the Australian Government’s

decision to centralise management of common

law injury claims against the Australian

Government and its agencies involving

asbestos related diseases. All liabilities

have transferred to Comcare (totalling

$808.8 million), although claims against

the Department of Defence continued to be

processed by the Department of Defence

pending a review which was expected to be

completed before July 2006 and

• the Federal Court decision, Comcare v

Etheridge and Ors [2006] FCAFC 27, where

it has been held that the inhalation of an

asbestos fibre by an employee was not an

‘injury simpiciter’ or frank injury. Accordingly

the date of injury must be determined in

accordance with the SRC Act which fixes

the date of injury according to the earliest

of the dates an employee dies, becomes

incapacitated, impaired, or seeks medical

treatment as a result of the disease. As a

result an amount of $38.9 million has been

identified as contingent liabilities (these would

otherwise have been recognised as claims

incurred but not reported). The financial

impact of this to future years is now under

consideration.

The financial statements show

• an operating result of $35.0 million ($25.6

million in 2004-05) and

• total equity of $71.3 million ($35.8 million in

2004-05).

The financial statements in this Annual Report

are the first to be reported using the Australian

Equivalents to International Financial Reporting

Standards (AEIFRS). For accounting purposes under

AEIFRS, Comcare’s workers’ compensation business

does not meet the definition of general insurance

contracts and as such the provision for outstanding

claims has been determined in accordance with

AASB 137 Provisions, Contingent Liabilities and

Contingent Assets and not AASB 1023 General

Insurance Contracts.

Consistent with the requirements of AASB 137,

Comcare’s financial statements report the best

estimate for workers’ compensation liabilities as the

central estimate determined by its actuaries.

At 30 June 2006 the ratio of assets to liabilities

under this standard was 114.2% (116.8% at

30 June 2005) and the estimated reserve at

30 June 2006 was $135.8 million ($144.1 million

at 30 June 2005).

Previous to AEIFRS, the provision for outstanding

claims also incorporated a risk margin of 10.6%.

Under this previous standard, Comcare would have

reported the ratio of assets to liabilities as 103.2%

(105.6% at 30 June 2005), and the estimated

reserve at 30 June 2006 as $34.3 million ($53.4

million at 30 June 2005).

Despite the change to the basis of valuation

of the outstanding claims provisions in the

financial statements under the AEIFRS, Comcare

continues to have regard to the risks associated

with the uncertainty inherent in the valuation in

the prudential management of post 1 July 1989

workers’ compensation claims business.


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REGULATORY SERVICES

OUTPUT 1 .1 – SRC ACTREGULAT ION

SAFETY , REHAB IL I TAT ION ANDCOMPENSAT ION ACT 1988The SRC Act establishes a fully funded premium

based system of compensation and rehabilitation

for employees who are injured in the course of

their employment. There is also provision for

Commonwealth authorities and eligible corporations

to self insure under a licensing system. The SRC Act

covers Commonwealth employees1 and employees

of certain private sector corporations. ACT

Government employees are also covered as a result

of a declaration made under the SRC Act in 1994.

The SRC Act empowers employers to provide active

rehabilitation programs to achieve early and safe

return to work for their work injured/ill employees

together with active claims management by

determining authorities (Comcare and the licensees).

It has a comprehensive benefits structure with

limited common law rights.

This Act operates in conjunction with the OHS(CE)

Act to provide an integrated framework for workplace

injury/disease prevention and management and

workers’ compensation.

KEY PO INTSThe focus of this output in 2005-06 was on

• assisting Australian and ACT Government

agencies to improve their rehabilitation

performance

• the continued provision of jurisdictional

policy advice on workers’ compensation and

rehabilitation

• regulation of self insurers and

• monitoring and reporting on the performance

of the SRC Act scheme.

ACT IV IT IESA range of activities was undertaken during 2005-

06 under this output.

COMPENSAT ION AND INJURY MANAGEMENTPOL ICYComcare continued to provide advice on ways of

improving compensation and injury management

systems while maintaining accountability and

retaining the integrity of the workers’ compensation

scheme.

LEG ISLAT IVE REFORMDuring the year Comcare continued to provide input

on the operation of the SRC Act, including possible

SRC Act amendments. In its 2006-07 Budget,

the Government announced plans for a number of

amendments to the SRC Act including strengthening

the connection between employment and eligibility

for workers’ compensation, increasing the required

employment threshold for disease claims and

removing coverage for journey and recess claims.

Also announced were proposals to change the

way in which retirees’ incapacity benefits are

calculated so that the deeming rate for interest on

superannuation lump sums better reflects real rates

of interest being earned. An increase in funeral

benefits, as well as a number of minor changes to

assist Comcare in its administration of the scheme,

were also proposed.

NEW SRC ACT SECT ION 41 GU IDEL INESThe SRC Act provides for Comcare to prepare

and issue guidelines to employers (Rehabilitation

Authorities) on performance of their functions

and powers under the Act (s36, s37 and s40 of

the SRC Act). Comcare issued new Section 41

Guidelines effective from 1 September 2005. The

new Guidelines were developed through extensive

consultation with representatives of premium paying

employers, licensees and rehabilitation providers.

The new Guidelines emphasise the employers’

obligation to take all reasonable steps to provide

an injured employee with suitable employment or

to assist them to find such employment. The new

Guidelines require premium paying employers

1 Until 30 June 2004 the SRC Act also covered members of the Australian Defence Force (ADF). From 1 July 2004 the SRC Act covers members of the ADF only in respect of injuries or diseases related to ADF service prior to that date. Responsibility for the management of the ADF’s SRC Act claims was transferred to the Military Rehabilitation and Compensation Commission from 1 July 2004. Accordingly, outcomes relating to the management of those claims are no longer reported by Comcare.

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to advise Comcare where they have been unable

to achieve this. The Guidelines are available on

Comcare’s website at www.comcare.gov.au.

MID-TERM REV IEW OF APPROVEDREHABIL I TAT ION PROV IDERSComcare completed a mid term review of Approved

Rehabilitation Provider performance as part of its

process for approving providers under the SRC Act.

The mid-term review found that providers were

generally achieving Comcare’s outcome standards

(achievement of at least a 90% RTW rate, RTW

programs achieve a median cost under $1,590 and

a median duration of under 19 weeks), but that

improvements can be made.

Comcare provided to approved providers feedback

on their performance against the outcome standards

as well as qualitative feedback from employers.

Comcare will be reviewing the outcome standards

prior to inviting rehabilitation providers to submit

applications for the next three year approval period

which commences 1 July 2007.

Information about how to apply for approval as a

rehabilitation program provider is available through

Comcare’s general enquiry number or by contacting

[email protected]. A directory of

approved rehabilitation providers is available on

Comcare’s website at www.comcare.gov.au.

PERMANENT IMPA IRMENT GU IDE – SECONDEDIT IONOn 1 March 2006, the second edition of Comcare’s

Guide to the Assessment of the Degree of

Permanent Impairment came into effect. It applies

to all permanent impairment applications from that

date.

The new Guide was approved by the Minister

on 8 September 2005 after a wide consultation

process including specialist medical groups, plaintiff

lawyers, licensees and other interested parties.

The new Guide updates the previous Guide which

had been in place since 1988. The new Guide is

based on the 5th edition of the American Medical

Association’s Guides to the Evaluation of Permanent

Impairment and as such, is now more consistent

with the majority of state and territory schemes

which base their assessment guides on either the

4th or 5th editions of the American Guides.

Comcare has instituted a comprehensive

implementation program for the second edition. This

has included

• the provision of training to more than 300

specialist doctors in conducting assessments,

with further training to be held as required

• briefing of legal firms, the Administrative

Appeals Tribunal and other interested bodies

• training of determining authorities’ claim

managers and

• development of new claim forms and reporting

formats.

The new Guide, claim forms and doctor’s reporting

format are on the Comcare website, as well as a

list of the doctors who have undertaken Comcare’s

training.

SELF INSURANCEThe SRC Act provides for the Minister to declare

certain Commonwealth authorities and corporations

eligible to apply to the Commission for a licence to

self insure their workers’ compensation liabilities

under the Act.

When considering applications for a licence

from organisations that have been declared, the

Commission assesses applicants’ capacity to meet

established licence conditions and the requirements

of the SRC Act. These include prudential and

financial requirements, the capacity to meet the

Commission’s standards with respect to prevention

and rehabilitation, and the capacity to manage

workers’ compensation claims in accordance with

the Commission’s standards.

During 2005-06, the Minister declared K&S

Freighters Pty Ltd, Linfox Australia Pty Ltd, Linfox

Armaguard Pty Ltd and Snowy Hydro Limited

eligible corporations under the SRC Act.

The Commission granted a licence to both Linfox

Australia Pty Ltd and Linfox Armaguard Pty

Ltd which commenced on 3 April 2006 and to

K&S Freighters Pty Ltd which commenced on 1


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July 2006. Snowy Hydro Limited withdrew its

application for a self insurance licence due to a

change in its circumstances and its application was

therefore not considered by the Commission.

At 30 June 2006, there were twelve entities with

self insurance licences under the SRC Act. These

were

• ADI Limited

• Australian air Express Pty Ltd

• Australian Postal Corporation

• CSL Limited

• K&S Freighters Pty Ltd

• Linfox Armaguard Pty Ltd

• Linfox Australia Pty Ltd

• Optus Administration Pty Limited

• Pacific National (ACT) Limited

• Reserve Bank of Australia

• Telstra Corporation Limited and

• Visionstream Pty Ltd.

During 2005-06 the Commission endorsed a

number of enhancements to its self insurance

regulatory model. These included

• the introduction of a tier model that relates

the intensity of regulatory oversight to licensee

performance which then influences the annual

licence fees charged

• the provision for extension of licences to

existing licensees to apply for a period of four

years

• the redesign of audit tools for prevention,

rehabilitation and claims management and

• the introduction of a data integrity tool.

A major achievement in 2005-06 was the

replacement of the existing Management Systems

Review and Improvement Program (MSRIP), the tool

used by the Commission to monitor performance of

licensees, with the ‘Licensee Improvement Program’

(LIP). The overall objective of the LIP is to provide

a regulatory framework for the management of self-

insurance arrangements under the SRC Act scheme

that

• reflects the Commission’s principles of

regulation

• links the level of regulatory oversight to

performance

• is easy to understand and administer and

• focuses on a holistic approach to performance

evaluation.

The LIP involves the annual evaluation of licences

with respect to

• compliance with prudential and financial

conditions of licence

• reporting against Commission performance

indicators

• audit outcomes in prevention, rehabilitation,

claims management and data integrity and

• results of any OHS investigations.

Licensees are required to provide an annual

performance report to the Commission which

identifies the key activities and outcomes for the

reporting year and key objectives for the coming

year. The Commission evaluates the licensee’s

performance when considering the level of regulatory

oversight to apply to the licensee’s prevention,

rehabilitation and claims management functions for

the coming reporting year. For further information

refer to the Commission’s Annual Report.

REPRESENTAT IONComcare is a member of the Heads of Workers’

Compensation Authorities (HWCA). HWCA

comprises the chief executives from Australian

Government, State and Territory workers’

compensation schemes and the New Zealand

scheme. Its prime purpose is to share information

amongst jurisdictions and promote increased

national consistency in the design of Australian

workers’ compensation schemes. It generally meets

four times each year. During 2005-06, HWCA

discussed a range of issues, including achieving

national uniformity in the regulation of self-insurers

under the various schemes.

Comcare is also a member of the ASCC. The key

role of the ASCC is to provide leadership and

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coordination for national efforts to prevent workplace

death, injury and disease. It also works to improve

national workers’ compensation, rehabilitation and

return to work arrangements and provide advice to

the Workplace Relations Ministers’ Council (WRMC)

on national directions, particularly on arrangements

to deliver nationally consistent frameworks in these

areas. Its Workers’ Compensation Working Group is

chaired by Comcare’s CEO. The ASCC held its first

meeting on 20 October 2005.

PERFORMANCE

OUTPUT DESCR IPT IONThis output encompasses activities carried out by

Comcare in relation to the administration of the SRC

Act. It covers

• workers compensation and injury management

policy

• assistance to the Commission, particularly

in relation to self-insurance licensing and

associated compliance monitoring functions

and

• evaluation of scheme performance.

OUTPUT PERFORMANCE MEASURE

QUANT ITY /QUAL ITY /T IMEL INESS

• Performance meets Commission requirements.

Throughout the year, the Commission considered

performance against a range of key measures which

address claims management and rehabilitation

functions performed by Comcare, premium paying

agencies and licensees under the SRC Act.

In relation to scheme performance overall, the

Commission noted that claim trends which

have driven significant premium increases in

recent years have now stabilised. While this is

encouraging, injury rates continue to be too high.

The Commission recognised that Comcare has put

in place strategies to reduce injury rates. But more

needs to be done and the Commission has asked

Comcare to assist poorly performing agencies and

employers.

PR ICE

• Budget estimate $3.7 million

The actual price for delivering Output 1.1 was $3.5

million.


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OUTPUT 1 .2 – OHS(CE) ACT REGULAT ION

OCCUPAT IONAL HEALTH AND SAFETY (COMMONWEALTH EMPLOYMENT) ACT 1991The objects of the OHS(CE) Act are to promote the

health, safety and welfare at work of Australian

Government employees and the protection of third

parties at the workplace.

An Australian government employee is a person

who is employed by an Australian Government

department or agency, a Commonwealth authority

or an Australian Government Business Enterprise.

Consistent with the objects, the OHS(CE) Act places

a general duty of care relating to OHS on Australian

Government employers, employees, manufacturers,

suppliers of plant and substances and persons

erecting and installing plant in the workplace.

The obligations in the OHS(CE) Act are supported by

additional requirements set out in the Occupational

Health and Safety (Commonwealth Employment)

Regulations 1991 (OHS(CE) Regulations) and the


Employment)(National Standards) Regulations

1994 (National Standards Regulations).

The OHS(CE) Regulations set out mandatory

supplementary provisions about various procedures,

responsibilities and obligations associated with

the OHS(CE) Act such as incident notification and

incident investigations. The National Standards

Regulations set out mandatory requirements with

respect to risk assessments, competencies and

certification standards and control of specific risks

in the workplace such as plant safety, occupational

noise, manual handling, hazardous substances and

confined spaces.

The OHS(CE) Act, OHS(CE) Regulations and

National Standards Regulations are supported

by codes of practice. These codes of practice are

approved by the Minister for Employment and

Workplace Relations.

The purpose of approved codes of practice is

to provide practical guidance to employers and

employees about ways of achieving compliance

with the obligations imposed by the OHS(CE)

Act. They are designed to be used in conjunction

with the OHS(CE) Act and Regulations, are not

legally binding, but may be used in evidence in a

prosecution under the Act.

There are currently 27 approved codes of practice

covering issues such as vibration, first aid, HIV and

hepatitis, and safety in laboratories.

One of the hallmarks of the Australian Government

jurisdiction is that voluntary compliance is

encouraged to the greatest extent. Comcare adopts

an holistic approach to securing compliance which

emphasises prevention and includes employer and

stakeholder engagement, training and education,

cooperative programs and compliance assistance.

However, the OHS(CE) Act does contain a strong

enforcement regime that includes both civil and

criminal enforcement mechanisms and penalties. All

Australian Government employers, employees and

other parties who have duties under the OHS(CE)

Act and Regulations are subject to the compliance,

enforcement and penalty provisions.

NAT IONAL OHS STRATEGYIn May 2002, the WRMC endorsed the National

OHS Strategy 2002-2012, encompassing five

national priorities and two national targets. The

National OHS Strategy provides a framework to

bring about short and long-term OHS improvements

and longer-term cultural change.

Comcare’s activities are aligned with and contribute

to the implementation of the strategy in the

Australian Government OHS jurisdiction.

The national priorities are to

• reduce high incidence/severity risks

• develop the capacity of business operators and

workers to manage OHS effectively

• more effectively prevent occupational disease

• eliminate hazards at the design stage and

• strengthen the capacity of government to

influence OHS outcomes.

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The Strategic Initiatives section of this report

provides information on the two national targets as

well as the additional targets implemented by the

Commission.

KEY PO INTSThe focus of this output in 2005-06 was

• developing regulations, codes of practice and

other guidance material

• developing amendments to the OHS(CE) Act

• HSR course accreditation and

• ensuring compliance with the OHS(CE) Act.

ACT IV IT IESA range of activities was undertaken during

2005-06 under this output.

LEG ISLAT IVE AMENDMENTSThe OHS and SRC Legislation Amendment Bill was

before the Parliament at the end of the 2005-2006

reporting period. The amendments extend coverage

of the OHS(CE) Act to all self-insured licensees

under the SRC Act. The Bill will also change the

name of the Act to the Occupational Health and

Safety Act 1991 to reflect its extended application

beyond Australian Government workplaces.

The Occupational Health and Safety

(Commonwealth Employment) Amendment Bill

2005 was also before the Parliament at the end of

the 2005-06 reporting period. The amendments

require employers to develop health and safety

management arrangements in consultation with

the employees and facilitate genuine consultation

between employers and employees.

NAT IONAL STANDARD REGULAT IONSTwo important amendments were made to the

National Standards Regulations this financial year

which were

• amendment to Part 6 to implement the

new National Code of Practice for the

Preparation of Material Safety Data Sheets

[NOHSC:2011(2003)] and

• addition of a new part, Part 8 – The Storage

and Handling of Dangerous Goods.

Work has also progressed on regulations relating to

• Major Hazard Facilities

• Management of asbestos in situ

• Storage and handling of explosives and

• Construction.

Consultative working groups comprising employer

and employee representatives were established

during 2005-06 to assist with the development and

implementation of proposed regulations on

• Dangerous Goods

• Major Hazard Facilities and

• Management of asbestos.

APPROVED CODES OF PRACT ICEA comprehensive review of all codes of practice

commenced this year. The review aims to improve

workplace health and safety outcomes by ensuring

that codes of practice efficiently support the

OHS(CE) Act and comply with the Australian

Government’s regulatory policies.

The Minister approved a new code of practice

for Dangerous Goods (2006) to provide practical

guidance to duty holders on ways to fulfil their

duties under the regulations.

L ICENS ING OF PLANTComcare administers Part 4 of the National

Standards Regulations which requires employers to

licence certain items of plant with the Commission.

Details of the number of licences granted, renewed

or varied are provided in the Commission’s Annual

Report.

REPRESENTAT ION ON NAT IONAL IN IT IAT IVESComcare represents Australian Government

employers on a number of OHS related committees

and working groups.

Comcare is a member of the Heads of Workplace

Safety Authorities (HWSA). HWSA provides a forum

for discussion of matters of interest to agencies

responsible for the regulation of OHS in Australia

and New Zealand. HWSA considers practical issues

associated with the administration of OHS legislation

and agrees to national approaches. Comcare, is a


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member of the ASCC OHS Working Group. Comcare

also participated on various National Standard

development groups run by the Office of ASCC

including Certification, Plant, Manual Handling, and

Hazardous Substances.

HAZARDOUS SUBSTANCES EXEMPT IONSComcare advised the Commission on applications

from the Australian Defence Organisation (ADO)

for exemptions in relation to the use of Chrysotile

Asbestos for mission-critical items where there

are no reasonable alternatives. The Commission

approved 7 applications. ADO notified the

Commission that exemptions were no longer needed

for 206 items and 178 new items were identified.

The ADO now holds certificates of exemption for

327 items, a reduction of 7% since June 2005,

indicating progress is continuing towards to the

elimination in the use of chrysotile by 2007.

PUBL ICAT IONS AND GUIDANCE MATER IALA report by Dr Peter Cotton, Preventing

Psychological Injury: A report for Comcare on the

pilot prevention project was produced this year.

This report was based on a consultancy project

conducted for Comcare by Dr Cotton and includes

background research and case studies. The report

will be published early in August 2006.

The following new guidance materials were

developed

Guidance on the Management of Eye Health in

the Workplace

Call Centres: A Guide To Safe Work and

Safety at Work: What you should know.

The following guidance material was revised

• The Principles of Effective OHS Risk

Management, based on the Commission’s

model

• Avian Influenza (Bird Flu) (Fact Sheet)

• Dangerous Goods (Fact Sheet)

• Security Incidents – suspect mail (Fact Sheet)

• Guide to Incident Notification and Reporting

• When an Investigator Calls and

• Introduction to the OHS Regulatory Framework

(webpage).

Work has progressed in the researching and

developing guidance material on the following issues

• Major Hazard Facilities

• Construction

• Electrical safety

• Explosives

• Bullying and

• Influenza Pandemic – OHS preparedness.

A comprehensive review of all OHS publications

continued with the objective of improving the

accuracy, consistency and accessibility of OHS

information. The review will ensure all Comcare’s

OHS publications are up to date and consolidated

into a single OHS Resources Suite. The structure

for the new suite has been refined and an holistic

publishing policy and guidelines has been developed

for the ongoing review project.

THE COMMISS ION ’S PREVENT ION PROGRAMComcare is responsible for implementing the

Commission’s Prevention Program. During

2005-06, program activity focused on promoting a

risk management approach to the management of

OHS issues, highlighting the benefit of integrated

safety management systems, and responding to

emerging risks. Work on preventing psychological

injury continued, including promotion at a number

of seminars and conferences of the findings of the

pilot psychological injury project conducted by Dr

Cotton. Dr Cotton’s report detailed both prevention

and early intervention strategies. Work has also

commenced on strategies for the prevention of body

stressing injuries.

PROV ID ING OHS INFORMAT ION AND ADV ICEComcare provides advice and information in relation

to the requirements of the legislation and associated

regulations and codes of practice through its

online advisory service - OHS.help, as well as by

telephone. Comcare also provides advice through

the specific online advisory/help services in relation

to the Plant and Dangerous Goods Regulations.

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PROMOT ING OCCUPAT IONAL HEALTH AND SAFETY MANAGEMENT SYSTEMS

In 2005-06, Comcare considered the need for

greater use by employers of Occupational Health

and Safety Management Systems (OHSMS) and

the capacity of employers to self assess and self

audit their OHSMS. Work is continuing on the

development of OHSMS self assessment tools

matched to the levels of maturity of individual

employer’s OHS management systems.

HEALTH AND SAFETY REPRESENTAT IVE TRA IN ING

Comcare convenes the OHS training panel which

accredits HSR training courses on behalf of the

Commission. There are 10 such accredited courses

currently, nine of which were reaccredited during

the year. In December 2005, the Commission

endorsed new guidelines for the accreditation of

health and safety representatives training courses.

These guidelines were developed in response to

an evaluation of the HSR training course program.

The new guidelines provide significantly greater

clarity about the accreditation process and will assist

organisations to provide higher quality courses with

a focus on continuous improvement.

SUPPORT ING COMPL IANCE AND ENFORCEMENT

Comcare developed a Compliance and Enforcement

Information Portal on its website. The Portal allows

public access to a range of policies and guidance

material that underpins Comcare’s Enforcement

Policy. The website will be launched in July 2006.

Comcare also developed new Guidelines for

investigations conducted under the OHS(CE) Act.

The introduction of the new investigation guidelines

was supported by a number of training workshops

for investigators, reinforcing the principles and

processes that support Comcare’s compliance and

enforcement action.

COMPL IANCE ACT IV I TYComcare has responsibility for conducting

investigations to determine compliance with the

OHS(CE) Act and may do so on its own initiative or

in response to a direction from the Commission.

There are two types of investigations – reactive

and proactive. A reactive investigation may be

undertaken in response to an incident. The OHS(CE)

Act requires employers to notify certain incidents to

Comcare. Such incidents include those that resulted

in a death, serious personal injury, incapacity, or a

dangerous occurrence that could have resulted in

these outcomes. Notifications are a key trigger for

reactive investigations.

A proactive investigation is generally scheduled in

advance as part of a targeted compliance program.

In 2005-06, Comcare undertook such a targeted

investigation program focussing on compliance

with the requirements of the National Standards

Regulations relating to manual handling.

Whilst most proactive investigations are scheduled

in advance, Comcare does have the power to

conduct a random investigation at an employer’s

workplace. Comcare also undertakes review

investigations to ensure recommendations made

in previous investigations have been appropriately

actioned by employers.

During the year, Comcare commenced a total

of 189 investigations made up of 76 reactive

investigations, 64 proactive investigations and 49

review investigations.

CONDUCT ING INVEST IGAT IONSThe OHS(CE) Act provides that arrangements may

be made under the Public Service Act 1999 for

officers of the public service of a State or Territory

to exercise the powers and perform the duties

of investigators under the OHS(CE) Act. To this

end, Memoranda of Understanding have been

agreed between the Commonwealth and most

State/Territory governments which allow Comcare

to appoint certain State/Territory officers as

investigators under the OHS(CE) Act to undertake

investigations when requested by Comcare.

Comcare also contracts a panel of private sector

organisations and appoints appropriately skilled

and qualified people from these organisations as

investigators under the OHS(CE) Act to undertake

investigations when requested by Comcare.


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As at 30 June 2006, there were 268 people

appointed as investigators under the OHS(CE) Act.

ENFORCEMENT ACT IONDuring the year, statutory enforcement notices were

issued pursuant to Sections 45, 46 and 47 of the

OHS(CE) Act.

Section 45 notices are ‘Do Not Disturb Notices’

issued by an investigator to ensure that a particular

workplace, part of a workplace, or piece of plant,

substance or thing is not disturbed for a specified

period of time. A ‘Do Not Disturb Notice’ is designed

to allow inspection, examination, measuring or

testing to take place. Sixteen Do Not Disturb notices

were issued during the year.

Section 46 notices are ‘Prohibition Notices’ issued

by an investigator prohibiting an activity that the

investigator believes involves, or will involve, an

immediate threat to the health and safety of a

person. Ten ‘Prohibition Notices’ were issued during

the year.

Section 47 notices are ‘Improvement Notices’ issued

by an investigator requiring a person to undertake

certain action if the investigator forms the opinion

that a person has breached, is breaching, or is likely

to breach the OHS(CE) Act or its regulations. Twelve

‘Improvement Notices’ were issued during the year.

Pursuant to subsection 53(4) of the OHS(CE) Act,

seventy-seven requests were made to employers to

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provide Comcare with particulars of actions taken

as a result of conclusions or recommendations

contained in a report of investigation.

PERFORMANCE

OUTPUT DESCR IPT IONThis output encompasses activities carried out

by Comcare in relation to the administration of

the OHS(CE) Act, including in support of the

Commission.

OUTPUT PERFORMANCE MEASURE

QUANT ITY /QUAL ITY /T IMEL INESS

• Incidence of workplace injuries

Target: 40% reduction by 30 June 2012

• Incidence of work-related fatalities

Target: 0 by 30 June 2012

• Performance meets Commission and CEO

requirements.

Throughout the year, the Commission considered

performance against a range of key measures

relating to the prevention activities of Comcare,

premium-paying agencies and licensees.

PR ICE• Budget estimate $6.8 million


million.

TABLE 7 : OHS(CE) ACT SCHEME PROF ILE

2001-02 2002-03 2003-04 2004-05 2005-06

Employees covered by OHS(CE) Act (FTE) 279,198 284,584 284,490 285,518 291,535

Number of employers paying an OHS

regulatory contribution 171 177 175 168 172

OHS budget ($m) 5.7 5.7 6.1 6.4 6.8

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CLAIMS MANAGEMENT

OUTPUT 1 .3 - MANAGEMENT OF PREMIUM CLA IMS

OUTPUT 1 .4 – MANAGEMENT OF PRE-PREMIUM CLA IMS

OVERV IEWComcare provides workers’ compensation coverage to over 185,475 Australian and ACT Government

employees for employers covered by the SRC Act. Claims are divided into two main groups — premium

claims (claims with a date of injury post July 1989), and pre-premium claims (claims with a date of injury

pre-July 1989). This split is based on changes in 1989 to the legislation covering workers’ compensation

arrangements for Australian and ACT Government employees and provides the delineation for Outputs 1.3

and 1.4.

COMCARE ’S ROLE IN MANAGING CLA IMS IS TO• ensure active and effective management of claims by determining claims and paying workers’

compensation benefits in accordance with the SRC Act and

• assist employers to achieve early and safe return to work of their injured employees.

TOTAL WORKERS ’ COMPENSAT ION EXPENDITUREIn 2005-06, total workers’ compensation expenditure for premium and pre-premium claims was $243.3

million (excluding the movement in outstanding liabilities and including claims management administrative

expenses).

PAYMENT ELEMENTS FOR TOTAL WORKERS ’ COMPENSAT ION EXPENDITUREThe major areas of expenditure for 2005-06 reflect

• payments to injured employees for time off work (incapacity payments) of $131.3 million or 53% of

costs and

• medical costs (including costs paid by Comcare for rehabilitation and travel) of $63.12 million or 25%

of total costs.


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TABLE 8 : PREMIUM CLA IM COSTS

PREMIUM CLAIMS EXPENDITURE2004-05

$’m

2005-06

$’m

Incapacity 90.00 95.05

Medical 43.27 53.61

Legal, Common Law and Lump Sums 24.36 20.04

Other 0.16 0.33

Administrative Costs 21.23 23.05

Sub Total 179.02 192.08

less Third Party Recoveries (5.26) (4.07)

Total Premium Expenditure 173.76 188.01

TABLE 9 : PRE-PREMIUM CLA IM COSTS

PRE-PREMIUM EXPENDITURE2004-05

$’m

2005-06

$’m


Medical 9.28 9.51


Other 0.29 0.14


Sub Total 63.39 55.50

less Third Party Recoveries (0.40) (0.22)

Total Pre-Premium Expenditure 62.99 55.28

TABLE 10 : TOTAL WORKERS ’ COMPENSAT ION EXPENDITURE BY PAYMENT TYPE

TOTAL PROGRAM EXPENDITURE2004-05

$’m

2005-06

$’m


Medical 52.55 63.12


Other 0.45 0.47


Sub Total 242.41 247.58

Less Third Party Recoveries (5.66) (4.29)

Total 236.75 243.29

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PREMIUM EXPENDITUREWorkers’ compensation payments and

administration costs associated with premium

claims were $188 million in 2005-06. This

expenditure was $18.5 million less than the

$206.5 million contained in the 2005-06 Portfolio

Budget Statement.

PAYMENT ELEMENTS FOR PREMIUMEXPENDITUREThe major areas of expenditure for 2005-06 reflect

• payments to injured employees for time off

work (incapacity payments) of $95 million or

49% of costs and

• medical costs (including costs paid by

Comcare for rehabilitation and travel) of $53.6

million or 28% of total costs.

PRE-PREMIUM EXPENDITUREWorkers’ compensation payments and administrative

costs associated with pre-premium claims were

$55.3 million in 2005-06. This expenditure is

$6.1 million less than the $61.4 million contained

in the 2005-06 Portfolio Budget Statement.

PAYMENT ELEMENTS FOR PRE-PREMIUMEXPENDITUREThe major areas of expenditure for 2005-06 reflect

• payments to injured employees for time off

work (incapacity payments) of $36.2 million

or 65% of costs and

• medical costs (including costs paid by

Comcare for rehabilitation and travel) of

$9.5 million or 17% of total costs.

MANAGING WORKERS ’ COMPENSAT ION CLA IMS

KEY DATAIn 2005-06, Comcare

• managed a total of 19,380 claims upon which

a payment was made under the SRC Act

• received 6,308 new claims and determined

6,168 — of these, 5,306 were accepted

(4,156 of which had a date of injury in

2005-06)

• decided 1,374 requests for reconsideration

• received 512 appeals to the Administrative

Appeals Tribunal (AAT) — 407 matters were

decided and

• took, on average, 25 days to determine new

claims and 28 days to decide reconsiderations.


55

OUTPUT 1 .3 - MANAGEMENT OFPREMIUM CLA IMS

KEY PO INTSThe focus of this Output in 2005-06 continued to

be on

• delivering benefits consistent with the SRC Act

• setting of premiums and regulatory

contributions

• assisting agencies to ensure injured and ill

employees stay at or return to work as quickly

and safely as possible

• quality decision making and

• improved dispute resolution processes.

ACT IV IT IESA range of activities was undertaken during 2005-

06 under this output.

WHOLE OF AGENCY STRATEGYComcare continued to work with a range of

employers to develop and implement effective,

targeted strategies to reduce the incidence and

duration of their workers’ compensation claims. The

Whole of Agency Strategy was initiated in 2002-03.

During 2005-06 Comcare worked closely with

the Australian Bureau of Statistics, the Australian

Taxation Office and the Child Support Agency.

On a less formal basis, Comcare also worked with

the ACT Government, Centrelink, CRS Australia,

the Australian Federal Police, the Department of

Employment and Workplace Relations, and the

Department of Defence to assist them in their

efforts to prevent work related injuries and achieve

early and safe return to work of their injured or ill

employees.

CUSTOMER SEMINARSIn 2005-06, Comcare convened two rounds of

customer seminars nationally, one in October

2005 and the other in May 2006. Seminars were

conducted in all capital cities and Townsville. In

May 2006, following requests from employers,

a seminar was also convened in Centrelink’s

Call Centre in Cairns involving several Australian

Government agencies.

This year, customer seminars moved away

from traditional presentations towards more

practical workshops around themes including risk

management and early intervention. Workshops

in May 2006 trialled an integrated approach to

considering better practice solutions to preventing

and managing body stressing injuries in

employment. The workshops involved employees

with responsibility for OHS and case management

and approved rehabilitation providers. Feedback

from these sessions was extremely positive.

In May 2006 a breakfast leadership session was

introduced to the seminars which was targeted at

senior managers from Australian, ACT Government

and self insured agencies. These leadership

seminars provided an opportunity for Comcare to

raise awareness about prevention and management

of body stressing injuries specifically with agency

heads, senior managers and regional office

managers.

2005 COMCARE NAT IONAL REHABIL I TAT ION CONFERENCEIn November 2005, Comcare’s third National

Rehabilitation Conference was held in Canberra,

entitled Early intervention - The key to prevention

and management of workplace injuries. The

conference was opened by the Minister for

Employment and Workplace Relations, The

Honourable Kevin Andrews, MP and was attended

by 280 delegates from both the public and private

sectors. Delegates included injury management

practitioners, allied health professionals and staff of

state workers’ compensation authorities.

Papers exploring a range of approaches to early

intervention were presented by representatives from

private industry, ACT and Australian Government

employers and injury management practitioners.

The conference provided practical advice on

the benefits of early intervention in response to

workplace incidents or injury as a mechanism for

claim prevention.

Participant feedback overwhelmingly confirmed

the success of this conference. A fourth Comcare

Rehabilitation Conference is scheduled for 2007-08.

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INTERAGENCY JOB PLACEMENT PROGRAMThe Interagency Job Placement Program (IJPP) was

a Comcare initiative which commenced in March

2005 with 33 Australian Government premium

paying employers committing to participate. The

program continued during the 2005-06 and is

coordinated through network groups in all mainland

states.

The purpose of the IJPP is to provide a forum for

participating employers to consider alternative

employment opportunities for employees on workers’

compensation who are unable to return to their

original place of work or employer following serious

injury. Placements between Australian Government

employers occurred throughout the financial year.

Some of the identified injured employees achieved

long term placement, while others completed short

term work trials as part of the IJPP process. Where

an employee completed a work trial they remain

candidates for long term placement.

The network groups have taken advantage of the

IJPP process to arrange placements other than

formerly through IJPP, such as placement of non-

compensation rehabilitation cases.

RETURN TO WORKComcare works with Australian and ACT

Government premium paying employers to

promote an early intervention approach to injury

management. Early intervention means identifying

and responding to symptoms, early warning signs

and reports of accidents and incidents so that

assistance can be provided to an employee before

they develop protracted injury or disease. However,

where injuries do occur Comcare continues to

provide employers with assistance from qualified

rehabilitation advisors with experience in injury

management, to achieve early and safe return to

work of injured or ill employees. Early intervention

was the theme of Comcare’s 2005 National

Rehabilitation Conference.

Comcare’s focus has been on

• actively working with all stakeholders,

including the injured employee and their

treating medical practitioner to develop and

implement an appropriate, tailored and

effective Return to Work Program

• assisting all parties to identify solutions to

impediments that may impact on the safe and

timely return to work of the injured employee

• ensuring employers work effectively with

Comcare’s claims managers to facilitate a

common understanding of return to work

issues

• advising employers on better practice injury

management protocols, such as early

intervention and active case management and

• reviewing tools and guidelines available to

employers for the management of injured

workers’ return to work programs.

Comcare’s Rehabilitation Guidelines for

Employers (section 41 guidelines) set out the

employers’ responsibility to commence appropriate

rehabilitation and return to work activities as soon

as possible after becoming aware of a work related

injury or illness. Where an employer considers that

it is not practical to provide an injured employee

with suitable duties, the guidelines now require that

the employer (other than licensed self-insurers or

the Defence Force) outline to Comcare that a proper

process has been undertaken to evaluate options for

return to work.

In addition, Comcare reviews potentially high

risk claims such as psychological injury and

occupational overuse injuries upon receipt.

Following review, Comcare contacts the employer

to discuss appropriate rehabilitation action. Early in

2006, Comcare refined its management of these

cases to enhance its ability to assist its stakeholders

to identify potentially complex cases and apply

return to work strategies aimed at facilitating early

and durable return to work outcomes. This follows

from the Comcare Body Stressing Claims Review

2005 completed by SANO Consulting.


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FACT F IND INGIn 2004-05, Comcare piloted an approach to

improving fact finding at the initial decision stage.

This model sought to streamline the collection

and documentation of facts around an injury. It

was expected that this in turn would assist the

claims decision making process and contribute to a

reduction in disputes, particularly where claims were

of a complex nature.

Comcare completed a review of the model in

2005-06. The review concluded that the model was

useful in circumstances where a claim warrants a

more arms length or independent approach to the

gathering of information. The review recommended

the tool be available for use in conjunction with

instruments available under s58 and s71 of the SRC

Act.

INFORMAT ION FOR EMPLOYERSDuring 2005-06, Comcare issued a guide for

employers to explain the process followed by

Comcare in the determining compensation

claims made under the SRC Act. The guide, How

Comcare determines claims made under the

Safety, Rehabilitation and Compensation Act 1988

(Pub61) is available on Comcare’s website at

www.comcare.gov.au.

MANAGEMENT SYSTEMS REV IEW & IMPROVEMENT PROGRAM (MSRIP )Since 2000-01 Comcare’s claims management

activities have undergone an annual audit using the

Commission’s MSRIP audit methodology. Audits

have been carried out by Comcare’s internal auditor.

The findings of the MSRIP audit in 2005-06 were

that

• Comcare had demonstrated a robust decision

making process. In each of the cases selected

for testing, Comcare was found to be making

appropriate determinations in line with the

requirements of the SRC Act.

• Comcare was making accurate payments to

claimants in line with the medical certificates

and treatment plans in 100% of cases

audited.

• Comcare had been effective in communicating

promptly with claimants in respect of their

claims under the SRC Act and

• the training program in place for claims

managers was of a high standard.

FRAUD CONTROL PLAN AND FRAUD DETECT ION & CONTROLComcare has fraud prevention, detection,

investigation and reporting procedures in place and

utilises fraud control data in its operations.

During 2005-06, Comcare undertook a risk

assessment of its operations and developed

a revised Fraud Control Plan for the following

two years. This activity incorporated fraud

risk management into a general business

risk management approach detailing specific

management accountabilities and responsibility for

fraud control across program lines.

One hundred and sixty investigations of suspected

fraud were completed during the year resulting in an

estimated reduction in liabilities of $2.1million.

IMAG ING TECHNOLOGYIn May 2006, Comcare concluded a trial to

establish the benefits or otherwise of scanning

documents and files instead of using hard copies.

Approximately 40 staff were identified to participate

in this trial across three Comcare worksites at

Mitchell ACT, Canberra Corporate Centre, ACT and

Melbourne, Vic. A significant sample of scanned

files and documents (approximately 10% of all files/

documents) were used in the trial. Based on the

outcomes of the trial, Comcare will be implementing

scanning of documents and files more broadly in

2006-07.

COMPLA INTS HANDL INGIn 2005-06, Comcare received 396 formal

complaints representing a decrease of 3% on

complaints received in the previous year. Of these,

142 were representations (63 to the Minister, 79

to the CEO) with 42 enquiries received from the

Ombudsman. Comcare experienced a reduction in

complaints made to external bodies and the majority

of formal complaints were made directly to Comcare

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58

as many claimants find it an easier alternative to

call Comcare’s own complaints area for resolution of

their problem.

The bulk of these matters were raised by claimants

or their representatives. The main concerns were

claims administration, the application of the

provisions of the SRC Act and communication

issues.

DISPUTE PREVENT ION AND MANAGEMENTThe SRC Act allows for a two-tiered review process

in relation to certain decisions made under the Act.

The first tier is a request for reconsideration. Once a

reconsideration decision has been made, it becomes

a ‘reviewable decision’ and a review of that decision

may then, if requested, be undertaken by the

Administrative Appeals Tribunal (AAT).

Comcare, in conjunction with the AAT, continued in

2005-06 to trial an approach to dispute resolution

which focused on facilitating resolution conferences

earlier than the formal AAT arrangements currently

provide. Comcare continues to engage the services

of contracted Legal Panels for advice and assistance

in managing applications before the AAT.

Comcare continued to work towards reducing the

number and complexity of disputes in relation to

compensation claims decisions. During 2005-06,

1,374 requests for reconsideration were decided

by Comcare compared to 1,545 in 2004-05. The

number of requests for review made to the AAT was

512 in 2005-06 compared with 575 in 2004-05.

The average time taken by Comcare to decide

reconsiderations reduced from 35 days in 2004-05

to 28 days in 2005-06.

TH IRD PARTY RECOVER IESSection 50 of the SRC Act enables Comcare to

take action in the name of an injured employee

or dependant for the recovery of damages in

circumstances where another person is legally liable

for the injury or death of the employee. This is

referred to as a “third party recovery”. An example

is where an employee is injured in a motor vehicle

accident and it is the fault of the driver of another

vehicle.

During 2005-06, Comcare recovered $856,912

in damages from third parties under section 50 of

the SRC Act. In addition, Comcare also recovered

$355,808 which was paid directly to claimants.

Of the funds paid directly to claimants, the

claimant must spend the relevant amount on the

compensable injury before they are entitled to make

further claims against Comcare.

PERFORMANCEThis output encompasses activities carried out by

Comcare in relation to the management of claims

with a date of injury from 1 July 1989.

OUTPUT PERFORMANCE MEASURES

QUAL ITY /QUANT ITY /T IMEL INESS

• Total assets (including notional surplus)

exceed total liabilities

• Premiums reflect sound actuarial assessment

of costs of claims

• Average time for rehabilitation intervention

Target: 90% reduction over the 10 years to 2012

• Average weeks lost time per 1,000 employees

Target: 40% reduction over the 10 years to 2012

• Performance meets Commission requirements

Target: Satisfactory or above

PR ICE• Budget estimate $206.5 million

The actual price for delivering Output 1.3 was

$188.0 million (excluding the movement in

outstanding claims liabilities).

ASSETS EXCEED L IAB IL I T IESEach year Comcare contracts consultant actuaries to

estimate outstanding liabilities for premium funded

claims. As part of the external audit process, the

ANAO contracts separate consultant actuaries to

review the estimate.

As at 30 June 2006, notional net assets ($1,093.5

million) exceeded the estimate of outstanding

liabilities ($957.7 million). This means that the

scheme remains fully funded with a notional surplus

of $135.8 million or 14%.


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PREMIUMS REFLECT EST IMATED COSTS OFCLA IMSUnder the SRC Act, annual premiums fund the costs

of claims for workers’ compensation for injuries

suffered after 30 June 1989.

Before setting the total of all premiums that it will

collect each year (the pool), Comcare considers

advice from consultant actuaries on the overall

amount that should be collected in premiums.

The actuaries estimate the total for Australian

Government employers separate from the total for

the ACT Government.

Comcare set the 2006-07 pool rate for Australian

Government employers at 1.77% of payroll,

unchanged from 2005-06. Comcare has set the

2006-07 pool rate for the ACT Government at

3.08% of payroll, unchanged from 2005-06.

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OUTPUT 1 .4 – MANAGEMENT OFPRE-PREMIUM CLA IMS


Comcare in relation to the management of claims

with a date of injury pre 1 July 1989.

KEY PO INTSThe major issues in pre-premium claims

management for 2005-06 were

• the ongoing management of outstanding

liabilities

• the continuation of the pre-premium project

and

• ongoing review of all claims to ensure that

entitlements are being managed correctly.

ACT IV IT IESA range of activities was undertaken during

2005-06 under this output.

PRE-PREMIUM PROJECTComcare maintained a specialist team during

the year to review long term claim processes and

practices and to improve the overall management of

these claims. In 2005-06, 87 claims were reviewed

under this project. Claims considered for review

were those where the claimant was in receipt of

ongoing incapacity payments, but had in recent

years claimed little or no medical and like expenses.

As at 30 June 2006, 52 claimants were found to

have a continuing entitlement to compensation, 22

were determined to have no ongoing entitlement

and 11 were issued with determinations requesting

further medical evidence. The preliminary results

from this project show an estimated reduction in

liability of $9.5 million.

INFORMAT ION FOR EMPLOYEESComcare provides a plain English publication about

workers’ compensation specifically designed for

injured employees with pre-premium claims. This

periodic newsletter, Comcare News, was issued

to ex-employees to inform them about such topics

as: redemption payments, understanding payment

advices, updates on superannuation and its effect

on workers compensation, and changes to statutory

benefits.

PERFORMANCE


Comcare in relation to the management of pre-

premium claims under the SRC Act.

OUTPUT PERFORMANCE MEASUREThe measures in the Portfolio Budget Statements for

Output 1.4 for the 2005-06 financial year were

QUANT ITY /QUAL ITYOutstanding claims liabilities valuations reflect

sound actuarial assessment of cost of claims

PR ICEBudget estimate $61.4 million

The actual price for delivering output 1.4 was $55.3

million excluding the movement in outstanding

claims liabilities.

OUTSTANDING L IAB IL I T IES VALUAT IONS REFLECT SOUND ACTUAR IAL ASSESSMENT OF THE COST OFCLA IMSCosts relating to injuries suffered before 1 July

1989 are funded from the Budget. Each year

Comcare contracts consultant actuaries to estimate

outstanding liabilities for these claims. Also, as part

of the external audit process the ANAO contracts

separate consultant actuaries to review the estimate.

As at 30 June 2006, the estimate of outstanding

liabilities for these claims was $455 million.


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OUTPUT 1 .5 – REGULAT ION OF THE SEACARE SCHEME FORWORKERS ’ COMPENSAT ION , REHAB IL I TAT ION ANDOCCUPAT IONAL HEALTH & SAFETYThe Seafarers Safety, Rehabilitation and

Compensation Authority (Seacare Authority)

administers the Seafarers Act, the OHS(MI) Act, the

Levy Act and the Levy Collection Act (collectively

referred to as the Seacare Scheme). It performs the

regulator role in relation to these Acts and has as

its mission: ‘to take a leading role in minimising the

human and financial costs of workplace injury in the

Australian maritime sector’.

Under the SRC Act (s72A), Comcare is required to

(a) give the Seacare Authority (established under

section 103 of the Seafarers Rehabilitation

and Compensation Act 1992) such secretarial

and other assistance and

(b) make available to the Seacare Authority the

services of such members of Comcare’s staff

and such other resources

as the Seacare Authority reasonably requires from

time to time for the proper performance of its

functions or exercise of its powers.

Comcare has operational responsibility for the

Seacare function; however the Australian Maritime

Safety Authority (AMSA) performs the inspectorate

function under the OHS(MI) Act and the Department

of Employment and Workplace Relations

(DEWR) provides policy advice to the Minister for

Employment and Workplace Relations regarding the

Seacare Authority and the Seacare legislation.

KEY PO INTSIn 2005-06 Comcare assisted the Seacare Authority

by

contributing to the WRMC Comparative

Performance Monitoring (CPM) seventh

report on Australian & New Zealand OHS

and workers’ compensation schemes,

including participation in the companion report

Comparison of OHS Arrangements in Australia

& New Zealand.

• contributing to the Australia & New Zealand

Return to Work Monitor prepared for the

HWCA, as well as the Comparison of Workers’

Compensations Arrangements report.

• auditing the workers’ compensation insurance

policies held by employers with reference to

section 93 of the Seafarers Act.

• introducing a new Seacare Authority Guide to

the Assessment of the Degree of Permanent

Impairment (2nd edition) on 1 March 2006

and provided training program on the new

guide for claims managers and interested

parties.

• revising and setting an appropriate target

reserve level for the Seafarers Safety Net Fund

taking into account assessments of future

default events and provisions for liabilities

incurred but not reported.

• seeking the Ministers’ approval to reduce the

rate of levy payable by employers quarterly to

the Seafarers Safety Net Fund from $53 to

$35 per seafarer berth on 1 April 2006.

• continuing to work on recommendations to

the Minister and DEWR on the adoption of

national OHS standards and codes of practice,

to the extent that they are applicable to the

maritime industry, and on the introduction of

appropriate regulations under the OHS(MI)

Act. In 2005-06 a manual handling regulation

and code of practice has been substantially

drafted and a regulatory proposal on entry and

work in confined spaces has been developed.

• monitoring the continuation, by the OHS

Inspectorate, the Australian Maritime Safety

Authority (AMSA), of regime of proactive OHS

inspections.

• signing a Memorandum of Understanding

with the member organisations of the Heads

of Workplace Safety Authorities (HWSA)

establishing protocols for information exchange

and to facilitate cooperation between the

operational divisions of each jurisdiction.

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• commencing work on the Seacare Awards 2006 program to recognise and acknowledge

the best positive initiatives by employers,

shipping operators, seafarers and others who

are leading the way in OHS and rehabilitation

and return to work practices.

• aligning three Seacare Awards 2006categories with national Safe Work Australia Awards.

• developing and preparing material for the Seacare Conference 2006 to be held on 26

October 2006, as part of Safe Work Australia Week supported by all Australian governments

and OHS jurisdictions and authorities.

• liaising with insurers providing cover under

the scheme and facilitating communication

between a principal insurer and scheme

employers.

• engaging employers and maritime industry

stakeholders through promotion of Sea Safe-Work Day on 28 April 2006, at a series of

industry briefings in various capital cities, and

via the Authority’s newsletter Seacare Newsand its website.

• enhancing the online reporting facility Seacare Online to provide employers with an efficient,

user-friendly and secure means of meeting

their statutory reporting obligations and

providing the Seacare Authority with timely

and high quality scheme data.

ACT IV IT IESComcare continued to provide secretarial and

other support services to the Seacare Authority, to

enable it to meet on a regular quarterly basis and

on other occasions as required and to perform its

statutory functions. A key element of Comcare’s

support is provision of legal advice to the Authority.

In addition, Comcare provided policy and strategic

advice to the Authority and administered statutory

functions under delegation from the Authority.

During 2005-06 Comcare administered the financial

aspects of the Seafarers Safety Net Fund consistent

with obligations under the Financial Management and Accountability Act 1997, and a levy collection

regime to support the Fund.

PERFORMANCE

PRICE• Budget estimate $0.42 million

The actual price for delivering Output 1.5 was

$0.42 million.

IND ICATORThree indicators or measures for assessing the

performance of the Seacare Authority in meeting

Output 1.5 are identified in the Portfolio Budget

Statement for 2005-06. These are

• the incidence of workplace injuries (target:

40% reduction by 30 June 2012)

• incidence of work related fatalities (target:

zero for the 10 years to 30 June 2012) -

both targets are consistent with the NOHSC

National Strategy Targets and

• Seacare scheme performance meets Seacare

Authority requirements.

Achievement of the first performance measure

would require, on average, a 4% reduction in the

incidence of injury each year from the base year

(2001-02), using NOHSC injury definitions (injuries

and musculo-skeletal disorders of one or more week

off work). In 2001-02, the incidence of injury in the

maritime industry covered by the Seacare scheme

was 32.33 per 1,000 employees. In 2005-06,

the Seacare incidence of injury rate had reduced to

27.79 per 1,000 seafarers. The rate of reduction

is consistent with that required to meet the interim

target of a 20% reduction by 30 June 2007, or a

rate of 25.86.

The scheme met the second performance measure

as there has been no work related fatalities in the

maritime industry covered by the OHS(MI) Act since

2001-02, indeed in the last 11 years.

With respect to the third performance measure, the

Seacare Authority has explored and continues to

explore strategies to address claims trends so that

better OHS and injury management performance

can be achieved.

The Seacare Authority produces an Annual Report

that is available on its website at

www.seacare.gov.au.


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OUTPUT 1 .6 – MANAGEMENT OF ASBESTOS RELATED PERSONAL IN JURY COMMON LAW D ISEASE CLA IMS AGA INST THE COMMONWEALTHThe Australian Government announced

centralisation of the management of common law

asbestos liability claims in the 2005-06 Budget.

The ARC Act and ARC(CTP) Act were enacted

to give effect to this decision with the operative

provisions came into force on 26 October 2005.

That legislation

• transferred to Comcare any common law

liabilities of the Commonwealth and with

certain exceptions, of Commonwealth

authorities, for asbestos-related conditions and

diseases with effect from 26 October 2005 or

the subsequent making of a claim

• appropriated to Comcare from the Consolidated

Revenue Fund payment of the amounts

necessary from time to time to discharge those

liabilities and

• authorised Comcare to manage those

liabilities, by managing records in relation

to those liabilities, responding to claims and

pursuing contributions from other defendants.

KEY PO INTSThe legislation did not

• transfer liabilities under, or recovery of

contributions in respect of, judgments or

settlements made before 26 October 2005 or

• transfer liabilities of the Australian Postal

Corporation, Telstra Corporation Ltd, and any

subsidiary of either corporation.

The Minister for Employment and Workplace

Relations has authority to declare that the legislation

does not apply to a named Commonwealth

authority. No such declarations had been made as

at 30 June 2006.

Asbestos claims against the Department of Defence

and claims made by former Australian Defence

Force members and their dependants are exempt

from the centralisation arrangements in the first

instance, subject to a review within twelve months.

The Department of Employment and Workplace

Relations has overall policy responsibility to ensure

consistency in management of the Australian

Government’s asbestos related disease liabilities.

The Minister announced on 10 May 2005 that

common law asbestos-related personal injury

claims against the Australian Government would be

managed by Comcare from 1 July 2005.

Although the legislation commenced on 26 October

2005, Comcare had been managing claims

made against the Department of Finance and

Administration, and the Department of Transport

and Regional Services since 1 July 2005 under

interim administrative arrangements.

PERFORMANCENo performance information was specified in

the 2005-06 portfolio budget statement for this

new output. Since it has been responsible for the

function, Comcare has

• developed and implemented a purpose

designed case management and statistical

business information system

• developed and published an Asbestos

Litigation Policy Statement

• published an Asbestos Litigation webpage on

its website and

• investigated procurement of an evidentiary

and reference material business information

system.

Comcare received or took over 189 common law

asbestos-related claims during the year, including

50 mesothelioma, 89 asbestosis claims, 24

asbestos-induced lung carcinoma claims and 26

other asbestos-related pleural disease claims.

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This involved 137 proceedings in the Dust Diseases

Tribunal of New South Wales, 32 proceedings in the

Supreme Court of Victoria and 11 proceedings in the

Supreme Court of Western Australia.

Fifty-nine claims were resolved during the year,

with 54 being settled, 3 being discontinued and 2

proceeding to trial and judgment. There were 130

unresolved claims as at 30 June 2006.

The above figures include 6 claims jointly managed

by Comcare and the Department of Defence but do

not include other claims managed by Defence nor

those reported on in the Department of Defence

Annual Report.

PR ICEBudget estimate N/A


million (excluding the movement in outstanding

claims liabilities).

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COMPARATIVE PERFORMANCE INFORMATION

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PERFORMANCE AGAINST TEN-YEAR TARGETSComcare’s Leadership and Accountability Strategy targets are linked to the National OHS Strategy 2002-12,

but go further to not only cover workplace injury but also work-related disease. Targets for premium-paying

organisations are reinforced by two additional rehabilitation targets identified by Comcare. In the 10 years to

30 June 2012, the four targets aim to

• reduce the incidence of workplace injury and disease by 40 per cent (T1)

• eliminate all fatalities due to workplace injury (T2)

• reduce the average lost time rate by 40 per cent (T3) and

• reduce the average time taken for rehabilitation intervention by 90 per cent (T4).

Variable results against the targets have been achieved by premium-paying employers during 2005-06.

Since the 2001-02 base year, premium payers have recorded

• a two per cent increase in the incidence of workplace injury and disease

• a 16 per cent increase in the average lost time rate and

• a 12 per cent reduction in the average time taken for rehabilitation intervention.

C0MPARATIVE PERFORMANCE INFORMATION

8

0

12

16

20

2001-02

Actual Incidence Rate Target Incidence Rate

GRAPH 3: CURRENT PROGRESS AGAINST THE REDUCTION IN CLAIMS INCIDENCE RATE (T1)

4

2002-03 2003-04 2004-05 2005-06 2006-07 2007-08 2008-09 2009-10 2010-11 2011-12

Financial Year

Cla

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per

100

0 F

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200

250

GRAPH 4: CURRENT PROGRESS AGAINST THE REDUCTION IN LOST TIME INCIDENCE RATE (T3)

50

2001-02

Actual Lost Time Rate Target Lost Time Rate

2002-03 2003-04 2004-05 2005-06 2006-07 2007-08 2008-09 2009-10 2010-11 2011-12

300

350

400

Financial Year

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GRAPH 5: CURRENT PROGRESS AGAINST THE TARGET IN TIME TAKEN FOR REHABILITATION INTERVENTION (T4)

2

2001-02

Actual time for intervention Target time for intervention

2002-03 2003-04 2004-05 2005-06 2006-07 2007-08 2008-09 2009-10 2010-11 2011-12

12

14

16

18

Financial Year

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COMMISSION INDICATORS AND ANNUAL TARGETSIn addition to the national targets, the Commission established key performance indicators to measure

the scheme’s performance in the areas of prevention, claims management, rehabilitation and scheme

administration. The Commission sets annual targets for its performance indicators and periodically monitors

the performance against these targets of Australian and ACT Government premium paying employers,

Comcare and licensees.

The objectives upon which these indicators and targets are established are

• Prevention ‘P’ indicators—a reduced level of workplace injury and disease

• Claims management ‘C’ indicators—accuracy and timeliness of determinations

• Return to work ‘R’ indicators—timeliness of access to appropriate rehabilitation assistance and

• Scheme administration ‘SA’ indicators—effectiveness of scheme administration.

PERFORMANCE AGAINST COMMISSION INDICATORS AND ANNUAL TARGETSThe following table provides details of the performance of Australian and ACT Government premium paying

employers and Comcare against the Commission’s indicators and targets for 2005-06.

The Commission’s Annual Report for 2005-06 includes a report by licensees and Comcare on their

performance against these measures. The Commission’s Annual Report also includes information on the

15 largest Australian Government premium paying employers’ performance against a selection of these

measures.


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TABLE 11 : PERFORMANCE AGA INST COMMISS ION IND ICATORS

Commission Indicator 2004–05 2005-06Target 2005-

06

P1—Incidence of claims resulting in 5 or more days of

incapacity per 1,000 FTE employees15.8 14.5 11.7

P3—Incidence of death claims per 100,000 FTE employees

– injury1.1 No cases Set at Zero

P3—Incidence of death claims per 100,000 FTE employees

– disease and commuting3.4 3.8 n/a

P4—Frequency of lost time claims per 1,000,000 hours

worked12.0 11.0 9.7

C1—Average time taken in calendar days to determine new

claims (from date of receipt)21 25 18

C2—Percentage of new claims determined 89% 87% 95%

C5—Average time taken in calendar days to decide

reconsideration requests (from date of receipt)35 28 35

R1—Percentage of claims with 10 or more days of

incapacity with a RTW plan58% 60% 60%

R3—Incidence of claims resulting in 30 or more days of

incapacity per 1,000 FTE employees (formerly P1.6)7.6 7.5 5.4

R4—Incidence of claims resulting in 60 or more days of

incapacity per 1,000 FTE employees (formerly P1.7)5.2 5.1 3.6

SA3—Outstanding liability $1,559m $1,413m n/a

SA4—Premium Rate – Australian Government 1.67% 1.77% n/a

SA4—Premium Rate – ACT Government 3.07% 3.08% n/a

Note: RTW – ‘return to work’

n/a – ‘not applicable’ as no targets are set by the Commission.

While these indicators measure only a subset of activities they are indicators of performance.

There remains a need for improvement across all prevention, rehabilitation and claims indicators. To this

end, Comcare continues to develop and implement strategies to improve its own performance and to assist

premium paying employers to improve their performance as detailed in this report.

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EMPLOYER PREMIUM OUTCOMES

PUBL ICAT ION OF PREMIUM RATESThe premium rate that Comcare sets for each

employer responds to that employer’s claim

frequency and average claim cost, as well as to

overall claim trends and the total amount that

Comcare needs to collect from all employers to cover

the cost of work related illness and injuries.

Therefore, the rate for each employer provides

an indication of the employer’s effectiveness in

preventing injuries and in helping its employees to

return to work quickly and safely after a work related

injury or illness.

Comcare and the Commission consider that

publication of employers’ premium rates over a

number of years should contribute to increasing

leadership accountability for prevention and injury

management.

The following table shows premium rates for

employers that had more than one hundred

employees in 2005-06 and in the previous three

years. Employers with fewer employees are not

shown because premium rates for small employers

respond more slowly to changes in the employer’s

claim performance than do premium rates for larger

employers. The 2006-07 rate is an initial rate for

2006-07, whereas the rates shown for 2003-04,

2004-05 and 2005-06 are revised rates. The

initial rate for 2006-07 takes into account the early

development of claims for injuries suffered in 2005.

It will be revised in 2007 when more information is

available on those injuries.

Caution is needed in interpreting premium rates for

employers because

• as noted above, the premium rate of each

employer responds to overall claim trends and

the total amount that Comcare needs to collect

as well as to each employer’s claim frequency

and average claim cost. The response to the

employer’s claim performance is faster for

larger than it is for smaller employers.

• comparison between employers may not

be valid because employees in different

organisations may face inherently different

risks. For example, the nature of duties and

type of workplace may be different.

• year-to-year comparisons for some employers

may also not be valid due to machinery

of government changes where parts of

organisations with higher or lower risk have

moved between employers.


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TABLE 12 : EMPLOYER PREMIUM PERFORMANCE

Customer name

2003-04

Revised

Rate

2004-05

Revised

Rate

2005-06

Revised

Rate

2006-07

Prescribed

Rate

2006-07

Rate

Quartile

Aboriginal Hostels Ltd 4.60% 5.30% 4.76% 4.62% 4

ACT Government (1) 3.13% 3.07% 3.08% 3.08% 4

Administrative Appeals Tribunal 0.77% 0.74% 0.79% 0.78% 1

Airservices Australia 0.66% 0.47% 0.46% 0.36% 1

Army & Air Force Canteen Service 3.47% 3.87% 4.08% 3.91% 4

Attorney-General’s Department 1.91% 1.82% 1.37% 1.62% 3

Australian Broadcasting Corporation 0.64% 0.80% 1.17% 1.12% 2

Australian Bureau of Statistics 1.50% 1.80% 1.66% 1.69% 3

Australian Communications and

Media Authority 1.29% 1.02% 2

Australian Competition and

Consumer Commission 0.81% 1.17% 1.11% 0.95% 2

Australian Crime Commission 0.53% 0.47% 0.44% 0.35% 1

Australian Customs Service 1.50% 2.34% 2.28% 2.29% 4

Australian Electoral Commission 0.85% 0.85% 1.72% 1.35% 3

Australian Federal Police 3.84% 3.52% 3.33% 3.87% 4

Australian Film Commission 1.51% 1.12% 0.92% 1.03% 2

Australian Film, Television and Radio

School 2.05% 1.60% 2.39% 2.11% 4

Australian Fisheries Management

Authority 0.82% 0.82% 1.25% 1.05% 2

Australian Government Solicitor 0.78% 0.69% 0.77% 0.59% 1

Australian Hearing Services 0.66% 0.74% 0.61% 0.75% 1

Australian Industrial Registry 0.85% 0.86% 0.80% 0.66% 1

Australian Institute of Health and

Welfare 1.12% 0.98% 1.31% 1.08% 2

Australian Institute of Marine Science 0.79% 0.64% 0.53% 0.70% 1

Australian Maritime College 1.90% 1.79% 2.15% 1.98% 4

Australian Maritime Safety Authority 0.88% 0.63% 0.47% 0.38% 1

Australian National Audit Office 0.90% 0.94% 0.72% 0.83% 2

Australian National Maritime

Museum 1.63% 1.63% 1.47% 1.33% 3

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Customer name

2003-04

Revised

Rate

2004-05

Revised

Rate

2005-06

Revised

Rate

2006-07

Prescribed

Rate

2006-07

Rate

Quartile

Australian National University 0.87% 1.28% 1.25% 0.95% 2

Australian Nuclear Science and

Technology Organisation 1.22% 0.68% 0.83% 0.59% 1

Australian Pesticides and Veterinary

Medicines Authority 0.92% 0.71% 0.56% 0.86% 2

Australian Prudential Regulation

Authority 0.92% 0.71% 0.71% 0.70% 1

Australian Public Service

Commission 1.09% 0.82% 1.29% 1.25% 3

Australian Radiation Protection and

Nuclear Safety Agency 0.64% 0.90% 1.02% 0.84% 2

Australian Rail Track Corporation Ltd 0.29% 0.21% 0.32% 0.45% 1

Australian Securities and Investments

Commission 1.21% 1.19% 1.20% 0.86% 2

Australian Sports Commission 1.09% 1.73% 1.85% 1.92% 3

Australian Taxation Office 1.62% 2.16% 2.74% 2.71% 4

Australian Trade Commission 0.55% 0.45% 0.48% 0.46% 1

Australian War Memorial 1.58% 1.55% 1.44% 1.39% 3

Bureau of Meteorology 1.01% 0.98% 1.24% 1.18% 2

Central Land Council 0.91% 0.82% 0.87% 0.81% 2

Centrelink 1.96% 2.41% 2.46% 2.61% 4

Civil Aviation Safety Authority 0.81% 1.36% 1.24% 1.26% 3

Comcare 2.00% 2.44% 2.79% 2.30% 4

Commonwealth Scientific and

Industrial Research Organisation 0.75% 0.70% 0.68% 0.83% 2

Commonwealth Superannuation

Administration 0.87% 1.72% 1.54% 1.66% 3

Defence Housing Authority 1.18% 1.37% 1.30% 1.34% 3

Department of Agriculture, Fisheries

and Forestry 2.02% 1.99% 2.26% 2.51% 4

Department of Communications,

Information Technology and the Arts 1.39% 1.63% 1.70% 1.28% 3

Department of Defence 1.11% 1.53% 1.47% 1.41% 3

Department of Education, Science

and Training 1.33% 0.95% 1.21% 1.52% 3


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Customer name

2003-04

Revised

Rate

2004-05

Revised

Rate

2005-06

Revised

Rate

2006-07

Prescribed

Rate

2006-07

Rate

Quartile

Department of Employment and

Workplace Relations 1.02% 0.87% 1.02% 1.08% 2

Department of Families, Community

Services and Indigenous Affairs 1.23% 1.34% 1.82% 1.81% 3

Department of Finance and

Administration 1.43% 1.24% 1.17% 1.04% 2

Department of Foreign Affairs and

Trade 0.65% 0.71% 0.51% 0.61% 1

Department of Health and Ageing 1.69% 1.28% 1.77% 1.70% 3

Department of Immigration and

Multicultural Affairs 1.67% 1.63% 1.39% 1.77% 3

Department of Industry, Tourism and

Resources 1.13% 1.45% 1.34% 1.33% 3

Department of Parliamentary Services 1.80% 1.71% 1.92% 1.55% 3

Department of the Environment and

Heritage 1.64% 1.52% 1.67% 1.65% 3

Department of the House of

Representatives 1.34% 0.85% 0.83% 0.74% 1

Department of the Prime Minister

and Cabinet 1.00% 0.53% 0.90% 0.85% 2

Department of the Senate 2.08% 1.41% 1.56% 1.40% 3

Department of the Treasury 0.91% 0.85% 0.65% 0.59% 1

Department of Transport and

Regional Services 0.97% 0.97% 1.19% 1.10% 2

Department of Veterans’ Affairs 1.61% 1.81% 2.68% 2.56% 4

Family Court of Australia 2.30% 2.21% 2.02% 1.99% 4

Federal Court of Australia 1.57% 1.25% 1.12% 1.06% 2

Food Standards Australia New

Zealand 0.58% 0.54% 0.57% 0.58% 1

Great Barrier Reef Marine Park

Authority 0.66% 0.64% 0.53% 0.67% 1

Health Services Australia Ltd 0.99% 1.04% 1.44% 1.06% 2

Insolvency and Trustee Service

Australia 1.03% 0.73% 0.73% 0.67% 1

Medibank Private Ltd 1.16% 1.40% 1.06% 0.90% 2

Medicare Australia 2.04% 2.17% 2.55% 2.23% 4

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Customer name

2003-04

Revised

Rate

2004-05

Revised

Rate

2005-06

Revised

Rate

2006-07

Prescribed

Rate

2006-07

Rate

Quartile

Melbourne Symphony Orchestra Pty

Ltd 1.50% 1.92% 1.89% 2.21% 4

National Archives of Australia 1.41% 1.08% 0.86% 1.02% 2

National Gallery of Australia 1.92% 2.40% 2.29% 2.40% 4

National Library of Australia 1.59% 1.64% 2.22% 1.79% 3

National Museum of Australia 1.23% 1.45% 1.83% 2.14% 4

National Native Title Tribunal 1.01% 1.33% 1.34% 1.34% 3

Northern Land Council 1.34% 2.09% 2.58% 2.14% 4

Note Printing Australia Ltd 1.23% 1.57% 1.71% 2.11% 4

Office of the Commonwealth Director

of Public Prosecutions 0.73% 0.69% 0.88% 0.81% 2

Productivity Commission 0.50% 0.53% 0.70% 0.61% 1

Queensland Orchestras Pty Ltd 5.74% 6.25% 6.40% 5.66% 4

Snowy Hydro Limited 0.73% 0.95% 0.64% 0.52% 1

Special Broadcasting Service 0.72% 0.77% 1.04% 1.27% 3

Sydney Symphony Orchestra

Holdings Pty Ltd 1.21% 1.16% 1.60% 2.03% 4

The Australia Council for the Arts 0.78% 0.66% 0.67% 0.58% 1

Tourism Australia 0.43% 0.35% 0.34% 0.26% 1

West Australian Symphony Orchestra

Holdings Pty Ltd 3.81% 3.68% 4.02% 3.91% 4(1) ACT Government does not receive a “Revised Rate”. These are “Prescribed Rates”.

NATIONAL RETURN TO WORK MONITOREach year, Comcare participates in a national survey of return to work outcomes. The National Return to

Work Monitor (the RTW Monitor) benchmarks rehabilitation outcomes and compares the performance of the

premium paying employers under the SRC Act to other jurisdictions in Australia and New Zealand.

The survey is conducted by an independent research company in May and November each year. The

sample of employees surveyed is drawn from those employees who lodged a compensation claim seven

to nine months prior to the survey and who have spent at least ten days away from the workplace on

compensation. The results of the survey are used to target areas of rehabilitation management for

improvement.

Table 13 reports key results from the 2005-06 RTW Monitor and compares these to the national average as

well as outcomes from the previous year. The 2005-06 RTW Monitor showed premium paying employers

generally achieved improved RTW outcomes compared to the national average.


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TABLE 13 : RETURN TO WORK MONITOR RESULTS 2005-06

Premium paying employers* (%) National

average

2005-06 (%)2004–05 2005-06

Employees who had returned to work at

some point since injury91 92 87

Employees who had returned to work -

returned to their original employer93 94 83

Employees who were still working** 85 89 80

RTW plan developed 69 70 51

Employees involved in development of RTW

plan88 87 78

Helped to follow RTW plan: main supervisor 22 19 15

Helped to follow RTW plan: rehabilitation

provider20 36 18

Helped to follow RTW plan: case manager 17 15 8* comprises Australian and ACT Government premium payers

** injured employees who had returned to work and were still working at the time of the interview

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CORPORATE GOVERNANCEComcare’s role is defined in the SRC Act, the OHS(CE) Act, the Seafarers’ Act and the ARC Act. Comcare is

a statutory authority with body corporate status, managed under the provisions of the CAC Act. Comcare’s

corporate governance framework is directed at supporting the achievement of organisational goals and

ensuring that all legal and regulatory requirements are met.

DIAGRAM 3 : CORPORATE GOVERNANCE FRAMEWORK

MANAGEMENT AND ACCOUNTABIL ITY

Director’s Meeting

focuses on corporate governance obligations. The CEO is the sole

Director of Comcare

Claims Management Executive

provides strategic advice and reports on achievements in

relation to claims management activities including operational policy, performance, customer

service and business processes.

Comcare Executive

comprising the Chief Executive Officer (CEO), Deputy CEO and

the six General Managers, oversees the strategic operation of Comcare and makes decisions on the application of policy across

the organisation

Corporate Management Executive

provides strategic advice and reports on achievements in

relation to corporate activities including business, financial,

people, information management and corporate services.

Audit Committee

manages the audit program

Comcare National Consultative Committee (CNCC)

provides a joint employee and management forum that enables

consultation on matters which have a national focus

National Occupational Health and Safety Committee

an internal committee that advises Comcare Executive about

protecting the health and safety of its employees.

People Management Committee

advises Comcare Executive on strategic people management

issues

Executive Leadership Team (ELT)

comprising the CEO, DCEO, General Managers and Group Managers (EL2s) works collaboratively to improve coordination and integrationacross the organisation, evaluate progress with strategic initiatives,

and forecast and respond to emerging issues

CEO


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COMCARE EXECUT IVE ANDDIRECTOR’S MEET INGFor the purposes of the CAC Act, the Chief Executive

Officer is the sole ‘director’ of Comcare. She is

assisted in her corporate governance functions by

Comcare’s Executive team. The team consists of

the CEO, Deputy CEO and General Managers and

meets fortnightly. In particular the team oversees the

corporate and strategic direction of Comcare.

A Comcare Director’s meeting is held every three

months. This meeting includes the independent

chair of the Audit Committee, members of

Comcare’s Executive Team, Comcare’s legal

adviser and financial adviser. These meetings

focus attention on the three areas of Comcare’s

governance obligations

• Accountability (Stewardship)

• Performance (Leadership)

• Conformance (Control).

These meetings establish and maintain frameworks

for management in these areas and allow monitoring

and review by management.

The Executive Leadership Team (ELT) meets

monthly to evaluate the progress of strategic

initiatives, and forecast and respond to emerging

issues.

Three committees provide strategic and operational

advice to Comcare Executive in relation to claims

management, regulatory services and corporate

management activities. These committees meet

regularly and consist of General Managers and

Group Managers in the various Divisions.

AUDIT COMMITTEEComcare’s Audit Committee comprised the

independent chair, together with three Comcare

General Managers. Comcare’s Chief Financial Officer

(as observer), the internal audit provider (outsourced

to KPMG in 2005-06), and the Australian National

Audit Office attend as observers.

There were four meetings held during 2005-06. All

members or their nominees attended.

During the year both the Audit Committee Charter

and the Internal Audit Charter were reviewed and

updated to ensure that they continue to reflect best

practice.

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INTERNAL AUDITA three year internal audit plan was updated, taking

into consideration

• Comcare’s strategic plan

• Comcare’s strategic risks, which have been

identified and agreed by Comcare Executive

• discussions with Comcare Executive,

and knowledge of internal audit in other

Commonwealth public sector organisations

• previous audit programs and

• consultations with management by the Audit Committee Chair, including assessment of

current risk management and assurance

measures.

The plan was developed using a risk-based

approach to identify focus areas for inclusion in the

audit work program. Audits were undertaken in the

following areas

• Financial compliance

• Management Systems Review and

Improvement Program

• IT access controls

• Business continuity planning

• Effectiveness of fraud controls

• Performance management

• Self insurance licensing regime

• Post implementation review of X-pay (claimants’ incapacity payment system) and

• Data integrity audit of the claims management

system.

RISK MANAGEMENT Comcare’s business planning framework is

underpinned by strategic and operational risk

assessments. Ongoing risk management is the

responsibility of all Comcare Executive members as

part of their normal operations. It is reviewed by the

Audit Committee and monitored quarterly by the

Director’s Meeting.

The risk management framework for purchasing is

being reviewed and updated in consultation with a

member of Comcover’s Risk Management Panel.

Comcare participated in Comcover’s risk

management benchmarking program for 2005-06.

FRAUD CONTROL PLANComcare manages its fraud control activities

in accordance with the Attorney-General’s

Department’s, Commonwealth Fraud Control

Guidelines. The guidelines take into account

developments in corporate governance, business

practices and fraud control and require agencies to

continue to undertake fraud risk assessments and

prepare fraud control plans.

Comcare’s Fraud Control Plan was revised in

2005-06 to reflect Comcare’s commitment to

minimising the risk of fraud to reputation, assets

and programs through

• investigating and prosecuting instances of

fraud against Comcare’s programs

• maintaining and publishing a fraud control

plan in accordance with the Commonwealth

Fraud Control Guidelines

• maintaining and improving awareness of fraud

• documenting fraud control procedures, policies

and procedures

• encouraging professional and ethical conduct

by Comcare, employers and providers

• maintaining, supporting and fully respecting

confidentiality in accordance with the Privacy

Act 1988

• seeking to recover Comcare’s losses and taking

appropriate action against offenders and

• monitoring, reviewing and continually

improving our performance.

PROCUREMENT FRAMEWORKA Comcare Procurement Framework is being

developed in accordance with the Commonwealth

Procurement Guidelines and Audit Reports

on Purchasing Procedures and Practices, and

Reporting of Expenditure on Consultants issued by

the Australian National Audit Office.

Chief Executive Officer Guidelines have been

updated to provide Comcare staff with concise and


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up-to-date guidance to ensure compliance with legislative requirements as well as best practice.

Detailed business reviews are scheduled in the forthcoming financial year to assess adherence to the

Procurement Framework, Purchasing Guidelines, and Asset Management.

RECORDKEEP INGA renewed Records and Mail Centre (RMC) was established (formerly the File Centre) to better manage

Comcare’s mail and records. The Centre was relocated to new premises which will allow a better standard

of storage of records and more space and facilities for the advancement in technology that will allow imaging

(scanning) of correspondence and files.

Ministerials, Complaints Handling, Claims Operations and legal workflows are being integrated into the

TRIM system as part of a continuing transition to ‘best practice’ recordkeeping. Comcare also provided 629

hours in records management training to its staff.

MANAGEMENT OF HUMAN RESOURCESTABLE 14 : STAFF ING OVERV IEWAs at 30 June 2006 Comcare employed the equivalent of 359.43 full time operative staff Australia wide

under the Public Service Act 1999.

Classification Female Male Total

APS1 2.4 1 3.4

Cadet 1 1

APS2 19.27 18.64 37.91

APS3 34.16 14 48.16

APS4 41.83 15.8 57.63

APS5 36.06 16 52.06

APS6 42.14 32 74.14

LA 2 2

SLA 6.4 1 7.4

PLA 2 2 4

EL1 23.41 19.85 43.26

EL2 7.67 12.8 20.47

SES Band 1 4 2 6

SES Band 2 1 1

CEO 1 1

Total 223.34 136.09 359.43

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TABLE 15 : SALARY RANGES AS AT 30 JUNE 2006

Level Salary Range ($)

APS 1 19,006-34,970

Cadet 31,676-34,970

APS 2 35,797-39,657

Graduate APS 35,797-40,722

APS 3 40,722-43,923

APS 4 45,343-49,200

APS 5 51,154-55,220

APS 6 56,583-63,375

EL 1 69,344-79,500

EL 2 79,945-96,331

Legal Advisors 41,946-55,220

Senior Legal Advisors 56,583-69,344

Principal Legal Advisor 74,887-89,345

SES 98,000-153,000

TABLE 16 : STAFF ING BY FUNCT IONAL AREAThis table reports on full time equivalent operative staff employed under the Public Service Act 1999 as at

30 June 2006.

Division Classification Female Male Total

Office of the Chief Executive Officer

APS5 1.00 - 1.00

CEO 1.00 - 1.00

Sub Total 2.00 - 2.00

Claims Policy & Systems

APS1 1.8 1.00 2.8

APS2 10.67 3.64 14.31

APS3 3.67 3.00 6.67

APS4 4.40 6.00 10.40

APS5 1.00 2.00 3.00

APS6 13.87 10.00 23.87

EL1 4.00 4.00 8.00

EL2 1.00 3.00 4.00

SES Band 1 - 1.00 1.00

Sub Total 40.41 33.64 74.05


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Injury Management

APS1 0.6 - 0.60

APS2 5.6 4.00 9.60

Cadet 1.00 - 1.00

APS3 20.67 5.00 25.67

APS4 26.52 7.8 34.32

APS5 26.06 10.00 36.06

APS6 14.07 7.00 21.07

EL1 5.8 2.00 7.80

EL2 2.00 3.00 5.00

SES Band 1 1.00 1.00

Sub Total 102.32 39.80 142.12

Workplace Health & Safety

APS3 1.00 - 1.00

APS4 5.70 - 5.70

APS5 1.00 3.00 4.00

APS6 11.00 8.00 19.00

EL1 4.88 6.00 10.88

EL2 1.00 1.00 2.00

SES Band 1 1.00 - 1.00

Sub Total 25.58 18.00 43.58

SRC Act Policy & Support

APS5 1.00 - 1.00

APS6 2.60 1.00 3.60

EL1 3.00 3.85 6.85

EL2 1.00 2.00 3.00

SES Band2 - 1.00 1.00

Sub Total 7.60 7.85 15.45

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Legal Services

APS3 - 1.00 1.00

APS4 0.60 0.60

APS5 1.00 1.00

LA 2.00 2.00

SLA 6.40 1.00 7.40

PLA 2.00 2.00 4.00

SES Band 1 1.00 - 1.00

Sub Total 13.00 4.00 17.00

Research and Strategy

Graduate 1.00 - 1.00

APS3 1.00 1.00

APS5 1.00 1.00

APS6 0.60 1.00 1.60

EL1 3.73 1.00 4.73

EL2 0.80 1.80 2.60

SES Band 1 1.00 - 1.00

Sub Total 7.13 5.80 12.93

Corporate Management

APS2 2.00 11.00 13.00

APS3 8.82 4.00 12.82

APS4 4.61 2.00 6.61

APS5 5.00 - 5.00

APS6 - 5.00 5.00

EL1 2.00 3.00 5.00

EL2 1.87 2.00 3.87

SES Band 1 1.00 - 1.00

Sub Total 25.30 27.00 52.30

Total 223.34 136.09 359.43


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TABLE 17 : STAFF ING BY LOCAT ION AS AT 30 JUNE 2006

Location No. staff % total staff

Australian Capital Territory 297 78.57

New South Wales 8 2.11

Queensland 4 1.06

South Australia 4 1.06

Victoria 65 17.2

TABLE 18 : EMPLOYMENT STATUS BY GENDERThe figures in this table reflect actual head count.

30 June 2005 30 June 2006

Female Male Total Female Male Total

No. of full-time staff 220 136 356 200 134 334

No. of part-time staff 33 5 38 40 4 44

Total staff 253 141 394 240 138 378

STAFF RETENT ION AND TURNOVERThese tables report on movements into or out of Comcare during 2005-06, specifically the number of

ongoing and non-ongoing employees who commenced in or separated from Comcare during the period.

TABLE 19 : ONGOING STAFF

Female Male Total

SES

Commencements 2 1 3

Separations - 2 2

EL 1-2

Commencements 3 3 6

Separations 9 12 21

APS 1-6

Commencements 34 14 48

Separations 46 16 62

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TABLE 20 : NON-ONGOING STAFF

Female Male total

SES

Commencements - - -

Separations - - -

EL 1-2

Commencements 2 1 3

Separations 2 1 3

APS 1-6

Commencements 33 18 51

Separations 26 11 37

TABLE 21 : WORKPLACE D IVERS ITY PROF ILEThe figures in this table reflect actual head count of all employees (including inoperative staff) employed

under the Public Service Act 1999 as at 30 June 2006.

Inclusion in the categories Indigenous Australians, People with a Disability and Non-English Speaking

Background (NESB) is based on voluntary self-identification by employees.

30 June 2005 30 June 2006

Diversity Group No. % total staff No. % total staff

Women 253 64.21 242 63.9

Indigenous Australians 4 1.02 3 0.08

People with a disability 12 3.05 11 2.9

NESB1* 42 10.66 24 6.3*NESB1: people born overseas whose first language was not English.


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SENIOR EXECUT IVE SERV ICE (SES)REMUNERAT IONThe CEO of Comcare negotiates the nature and

amount of remuneration for SES officers and the

results of the negotiations are reflected in individual

AWAs made with each SES staff member.

PERFORMANCE PAY AND BONUSESPerformance bonuses totalling $128,000 were

paid in respect of the 2005-06 financial year. This

amount was paid to eligible staff under the Comcare

PDF.

CONSULTANTS AND COMPETIT IVE TENDERING AND CONTRACTING

POL ICY AND PROBITYIn line with the principles of the Commonwealth

Procurement Guidelines (CPGs), the Comcare policy

on selection and engagement of consultants is

based on the principles of

value for money

open and effective competition

ethics and fair dealing

accountability and reporting

national competitiveness and industry

development and

support for other related Australian

Government policies.

CONSULTANCY SERV ICESConsultancy services are one particular type of

service delivered under a contract for services. They

are distinguished from other contracts by the nature

of the work performed. A consultant is an entity

(individual, partnership or corporation) engaged

to provide professional independent and expert

advice or services. Typically, the term consultancy

services is used to describe the application of expert

professional skills to

• investigate or diagnose a defined issue or

problem

• carry out defined research, reviews or

evaluations or

• provide independent advice, information

or creative solutions to assist the agency in

management decision-making.

A consultancy contract will typically define the

nature, purpose and duration of the task to be

performed but does not detail the manner in which

the task is to be performed. The consultant is

usually paid on completion of milestones or in

a lump sum. Consultants are not employees of

Comcare and are not paid wages or other employee

entitlements. A contract for consultancy services is

based on a principal/consultant relationship.

DETA ILS OF CONTRACTS LET FORCONSULTANCY SERV ICESIn 2005-06 Comcare let four new contracts

for consultancy services with a total spend of

$157,642. No contracts were ongoing from

previous years.

The following table provides details of the

consultancy service let during 2005-06 with a

contract value of $10,000 or more, GST inclusive.

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TABLE 22 : CONSULTANCY SERV ICES

Consultant Description of

Service

Contract Price Selection Process Justification

Dale Boucher Legal Review $15,999 Direct Sourcing Specialised Skills

& Independent

Assessment

SANO Consulting Body Stressing

Research

$42,500 Tender Process Tender Selection

Hinds Workforce

Research

Staff survey $27,643 Existing Provider Provided service

for previous staff

survey. Selected to

ensure consistency

Palm Consulting

Group

Review of

Comcare’s

Integrated

Customer Service

Arrangements

$71,500 Request for

Quotation

Specialist Skills &

Availability

C333 Develop a report

into establishing

a communication

plan

$32,000 Direct sourcing Relevant skills and

availability

COMMONWEALTH DISABIL ITY STRATEGYComcare recognises the importance of the Disability Discrimination Act 1992 in ensuring the identification

and removal of barriers preventing people with disabilities from access to its programs and services and the

elimination of discriminatory practices. Comcare endeavours to meet its obligations under the Act through

implementation of the Commonwealth Disability Strategy.

Comcare recognises that people with disabilities have the right to participate in all aspects of its operations.

At each stage of the development of programs and services, Comcare takes into account the needs

of disabled people. Comcare provides an environment that recognises, values, and encourages the

contribution of employees with different backgrounds and experiences as well as physical and intellectual

capabilities.

Details of Comcare’s performance during 2005-06 in implementing the Commonwealth Disability Strategy

are set out in Appendix 9.

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lFINANCIAL STATEMENTS

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FINANCIAL STATEMENTS


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COMCAREINCOME STATEMENT for the year ended 30 June 2006

Notes2005/06 2004/05

$’000s $’000s

INCOME

Revenues 5

Revenue from Government 5 (A) 166,192 180,352

Goods and services 5 (B) 14,781 10,944

Workers’ compensation premiums 5 (C) 212,177 191,580

Interest 5 (D) 9,244 6,792

Other 5 (E) 54 623

Total Income 402,448 390,291

EXPENSES 6

Employees 6 (A) 24,862 22,879

Suppliers 6 (B) 14,268 12,933

Depreciation and amortisation 6 (C) 1,585 1,383

Net loss from sale of assets 6 (D) 52 2

Workers’ compensation claims expense 6 (E) 268,401 310,672

Common law asbestos related disease claims expense

6 (H) 58,241 16,800

Total Expenses 367,409 364,669

OPERATING RESULT 35,039 25,622

The above statement should be read in conjunction with the accompanying notes.

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COMCAREBALANCE SHEET as at 30 June 2006

Notes2005/06 2004/05

$’000s $’000s

ASSETS

Financial Assets 7

Cash and cash equivalents 7 (A) 83,494 47,309

Receivables 7 (B) 2,247,144 1,396,546

Other financial assets 7 (C) - 20

Accrued revenues 7 (D) 180 86

Total Financial Assets 2,330,818 1,443,961

Non-Financial Assets 8

Intrastructure, plant and equipment 8 (A) 4,291 4,569

Intangibles 8 (B) 281 302

Other non-financial assets 8 (C) 294 393

Total Non-Financial Assets 4,866 5,264

TOTAL ASSETS 2,335,684 1,449,225

LIABILITIES

Payables 9

Suppliers 9 (A) 1,381 1,190

Workers’ compensation claims payable 9 (B) 2,723 2,711

Other payables 9 (C) 3,527 1,106

Total Payables 7,631 5,007

Provisions 10

Employee provisions 10 (A) 6,657 6,312

Workers’ compensation claims 10 (B) 1,440,720 1,384,700

Common law asbestos related disease claims 10 (C) 808,800 16,800

Other 10 (D) 551 585

Total Provisions 2,256,728 1,408,397

TOTAL LIABILITIES 2,264,359 1,413,404

NET ASSETS 71,325 35,821

EQUITY

Contributed equity 605 605

Asset revaluation reserve 341 84

Retained surpluses 70,379 35,132

TOTAL EQUITY 71,325 35,821

Current assets 342,997 269,034

Non-current assets 1,992,687 1,180,191

Current liabilities 275,984 221,075

Non-current liabilities 1,988,375 1,192,329



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COMCARECASH FLOW STATEMENT for the year ended 30 June 2006

Notes2005/06 2004/05

$’000s $’000s

OPERATING ACTIVITIES

Cash received

Goods and services 18,036 12,470

Appropriations 58,930 67,732

Interest 9,171 6,799

Workers’ compensation premiums 232,571 209,859

Other 54 623

Total cash received 318,762 297,483

Cash used

Employees 24,517 22,513

GST paid to the Australian Taxation Office 19,008 17,598

Suppliers 15,997 14,905

Workers’ compensation claims 215,573 211,602

Asbestos related disease claims 6,541 -

Total cash used 281,636 266,618

Net cash from/(used by) operating activities 12 37,126 30,865

INVESTING ACTIVITIES

Cash received

Proceeds from sales of property, plant and equipment 102 103

Proceeds from wind-up of subsidiary 228 -

Total cash received 330 103

Cash used

Purchase of property, plant and equipment 1,272 2,223

Total cash used 1,272 2,223

Net cash from(used by) investing activities (942) (2,120)

Net increase in cash held 36,185 28,745

Cash at the beginning of the reporting period 47,309 18,564

Cash at the end of the reporting period 7 (A) 83,494 47,309


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COMCARESTATEMENT of CHANGES in EQUITY for the year ended 30 June 2006

Accumulatedresults

Assetrevaluation

reserve

Contributedequity/capital

Total equity

2005/06 2004/05 2005/06 2004/05 2005/06 2004/05 2005/06 2004/05

$’000s $’000s $’000s $’000s $’000s $’000s $’000s $’000s

Opening Balance 35,132 9,510 84 84 605 605 35,821 10,199

Income and Expense

Net operating Result 35,039 25,622 - - - - 35,039 25,622

Revaluation adjustment

- - 257 - - - 257 -

Transactions with Owner

Contributions by Owner

Wind-up of subsidiary

208 - - - - - 208 -

Closing Balanceat 30 June 70,379 35,132 341 84 605 605 71,325 35,821


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COMCARESCHEDULE OF COMMITMENTS as at 30 June 2006

2005/06 2004/05

$’000s $’000s

BY TYPE

Capital commitments

Infrastructure, plant and equipment 124 -

Total capital commitments 124 -

Other commitments

Operating leases 11,807 11,515

Other commitments 201 111

Total other commitments 12,008 11,626

Commitments receivable (1,121) (1,057)

Net commitments by type 11,011 10,569

BY MATURITY

Capital commitments

One year or less 124 -

Total capital commitments 124 -

Operating lease commitments

One year or less 3,004 2,686

From one to five years 7,355 8,829

Over five years 1,448 -

Total operating lease commitments 11,807 11,515

Other commitments

One year or less 201 111

Total other commitments 201 111

Commitments receivable (1,121) (1,057)

Net commitments by maturity 11,011 10,569

Operating leases are effectively non-cancellable and comprise:

Leases for office accommodationCanberra• Lease payments are subject to annual increases of 4%• A rent review is due on 1 July 2006 and 1 July 2009Melbourne• Lease payments are subject to annual increases of 4%Sydney• Lease payments are subject to annual increases of 4.5%Adelaide• Lease payments are subject to annual increases of 4%Brisbane• Lease payments are subject to annual increases of 4%

Leases for storageCanberra• Lease payments are subject to annual increases of 4%

Agreements for the provision of motor vehicles – senior executivesNo contingent rentals exist. There are no renewal or purchase options available to Comcare.

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COMCARESCHEDULE OF CONTINGENCIESas at 30 June 2006

Future statutory asbestos related disease claims

Legal actions TotalContingent liabilities

2005/06 2004/05 2005/06 2004/05 2005/06 2004/05

$’000s $’000s $’000s $’000s $’000s $’000s

Balance from previous period 32,500 - - - 32,500 -

Revaluation (1,300) 32,500 - - (1,300) 32,500

New 7,700 - 22,500 - 30,200 -

Total contingent liabilities 38,900 32,500 22,500 - 61,400 32,500

Details of each class of contingent liabilities are disclosed in Note 14 : Contingent Liabilities.The above schedule should be read in conjunction with the accompanying notes.


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COMCARENOTES TO AND FORMING PART OF THE FINANCIAL STATEMENTSfor the year ended 30 June 2006

Note Description

1 Summary of Significant Accounting Policies 2 The impact of the transition to AEIFRS from previous AGAAP3 Disclosure of Funding for Comcare4 Critical accounting judgements and estimates5 Income6 Operating Expenses7 Financial Assets 8 Non-Financial Assets 9 Payables10 Provisions11 Restructuring12 Cash Flow Reconciliation 13 Compensation and Debt Relief14 Contingent Liabilities15 Appropriations16 Financial Instruments 17 Reporting of Outcomes and Outputs18 Reinsurance19 Remuneration of Auditors20 Remuneration of Directors 21 Executive Remuneration22 Related Party Disclosures 23 Average Staffing Levels24 Resources Provided Free Of Charge 25 Assets Held In Trust

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COMCARENOTES TO AND FORMING PART OF THE FINANCIAL STATEMENTSfor the year ended 30 June 2006

1 — SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES1.1 Objectives of Comcare

Comcare is structured to meet one outcome.

Outcome 1: Minimise human and financial costs of workplace injury under schemes administered by Comcare and ensure that claimants receive compensation in accordance with Commonwealth obligations.

Agency activities contributing toward these outcomes are classified as departmental. Departmental activities involve the use of assets, liabilities, revenues and expenses controlled or incurred by the Agency in its own right.

Departmental activities are identified under six Outputs as follows:

Output 1.1 SRC Act regulation

Output 1.2 OHS (CE) Act regulation

Output 1.3 Management of premium claims

Output 1.4 Management of pre-premium claims

Output 1.5 Regulation of the Seacare scheme for workers’ compensation, rehabilitation and occupational health and safety

Output 1.6 Management of asbestos related personal injury common law disease claims against the Commonwealth

The continued existence of Comcare in its present form and with its present programs is dependent on Government policy and on continuing appropriations by Parliament for its administration and programs.

1.2 Basis of Preparation of Financial Statements

These financial statements are required by clause 1(b) Schedule 1 of the CommonwealthAuthorities and Companies Act 1997 and are a general purpose financial report.

The statements have been prepared in accordance with:

• Finance Minister’s Orders (being the Commonwealth Authorities and Companies Financial Statements for reporting periods ending on or after 30 June 2006 Orders);

• Australian Accounting Standards issued by the Australian Accounting Standards Board that apply for the reporting period; and

• Interpretations issued by the Urgent Issues Group that apply for the reporting period.


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The Income Statement, Balance Sheet and Statement of Changes in Equity have been prepared on an accruals basis and are in accordance with historical cost convention, except for certain assets which are at valuation and provision for outstanding claims and the provision for long service leave which are valued on a net present value basis. Except where stated, no allowance is made for the effect of changing prices on the results or the financial position.

Assets and liabilities are recognised in the Balance Sheet when and only when it is probable that future economic benefits will flow to the agency and the amounts of the assets or liabilities can be reliably measured. Assets and liabilities arising under agreements equally proportionately unperformed are however not recognised unless required by an Accounting Standard. Liabilities and assets which are unrecognised are reported in the Schedule of Commitments and the Schedule of Contingencies.

Revenues and expenses are recognised in the Income Statement when and only when the flow or consumption or loss of economic benefits has occurred and can be reliably measured.

The preparation of financial statements in conformity with Australian Equivalents to International Financial Reporting Standards (AEIFRS) requires the use of certain critical accounting estimates. It also requires Comcare management to exercise its judgement in the process of applying these accounting policies. The areas involving a higher degree of judgement or complexity, or areas where assumptions and estimates are significant to the financial statements have been disclosed in Note 4.

All amounts in the financial report are presented in Australian dollars.

1.3 Statement of Compliance

The financial report complies with Australian Accounting Standards which include AEIFRS.

This is the first financial report to be prepared in accordance with AEIFRS and comparatives for the year ended 30 June 2005 have been restated accordingly. AASB 1 First Time Adoption of Australian Equivalents to International Financial Reporting Standards has been applied in preparing these financial statements. Reconciliations of AEIFRS equity and operating result for 2004/05 under AEIFRS to the balances reported in 30 June 2005 financial report are detailed in Note 2 below.

Australian Accounting Standards require Comcare to disclose Australian Accounting Standards that have not been applied, for standards that have been issued but are not yet effective. The AASB has issued amendments to existing standards, these amendments are denoted by year and then number, for example 2005-1 indicates amendment 1 issued in 2005.

The table below illustrates standards and amendments that will become effective for Comcare in the future. The nature of the impending change within the table, has been out of necessity abbreviated and users should consult the full version available on the AASB’s website to identify the full impact of the change. The expected impact on the financial report of adoption of these standards is based on Comcare’s initial assessment at this date, but may change. Comcare intends to adopt all of the relevant standards upon their application date.

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1.4 Principles of accounting for workers’ compensation claims

Comcare manages workers’ compensation claims for Commonwealth employees under the SRC Act. Workers’ compensation claims for work related injuries and illness sustained on or after 1 July 1989 are referred to as ‘premium claims’ or ‘premium business’. Workers’ compensation claims for work related injuries sustained by Commonwealth employees prior to that date are referred to as ‘pre-premium claims’ or ‘pre-premium business’.

Title Standardaffacted

Application date* Nature of impending change Impact expected

on financial report

2005-1 AASB 139 1 Jan 2006 Amends hedging requirements for

foreign currency risk of a highly probable

intra-group transaction.

No expected impact

2005-4 AASB 139

AASB 132

AASB 1

AASB 1023

AASB 1038

1 Jan 2006 Amends AASB 139, AASB 1023 and

AASB 1038 to restrict the option to fair

value through profit or loss and makes

consequential amendments to AASB 1

and AASB 132.

No expected impact

2005-5 AASB 1

AASB 132

1 Jan 2006 Amends AASB 1 to allow an entity to

determine whether an arrangement is, or

contains, a lease. Amends AASB 139 to

scope out a contractual right to receive

reimbursement (in accordance with

AASB 137) in the form of cash.

No expected impact

2005-6 AASB 3 1 Jan 2006 Amends the scope to exclude business

combinations involving entities or

businesses under common control.

No expected impact

2005-9 AASB 4

AASB 1023

AASB 139

AASB 132

1 Jan 2006 Amended standards in regards to

financial guarantee contracts.

No expected impact

2005-10 AASB 132

AASB 101

AASB 114

AASB 117

AASB 133

AASB 139

AASB 1

AASB 4

AASB 1023

AASB 1038

1 Jan 2007 Amended requirements subsequent to

the issuing of AASB 7.

No expected impact

2006-1 AASB 121 31 Dec 2006 Changes in requirements for net

investments in foreign subsidiaries

depending on denominated currency.

No expected impact

AASB 7FinancialInstruments: Disclosures

1 Jan 2007 Revise the disclosure requirements for

financial instruments from AASB132

requirements.

No expected impact,

changes disclosure

requirements

Notes to and forming part of the Financial Statements

* Application date is for annual reporting periods beginning on or after the date shown.


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For premium claims, premiums are received from employers covered under the SRC Act. They are calculated using a system and methodology developed by an independent actuary and are intended to fully fund all liabilities incurred over the life of these claims. All premiums are charged up front for the full financial year. As a result there are no unearned premiums or deferred acquisition costs at the end of the financial year. Changes to premiums arising from wage and salary adjustments are recognised in the year in they become payable or receivable.

Premiums are not levied in respect of pre-premium claims as they are funded by parliamentary special appropriations on an emerging cost basis.

In accordance with Section 128A of the SRC Act, provision is not required to be made for liabilities incurred prior to 1 July 1989 in respect of Public Trading / Government Business Enterprises.

As a result of a Federal Court decision there has been a change in accounting policy relating to the treatment of statutory workers’ compensation claims for asbestos related diseases. Previously, workers’ compensation claims for asbestos related diseases were recognised by reference to the date of inhalation. As a consequence of the Federal Court decision, these claims are now recognised on the earliest of dates on which the employee dies, becomes incapacitated, impaired, or seeks medical treatment as a result of the disease. The financial effect of this change in accounting policy at 30 June 2006 is a reduction of claims provisions of $38.9m and a reduction in appropriations receivable of $38.9m. Further details of the impact of the Federal Court decision are disclosed at Note 10(F).

1.5 Claims Provisions

The liability for workers’ compensation claims (both premium and pre-premium) and common law asbestos related disease claims are determined in accordance with the requirements of AASB 137 Provisions, Contingent Liabilities and Contingent Assets. Provisions for claims are recognised when: Comcare has a present legal or constructive obligation as a result of past events; it is probable that an outflow of resources will be required to settle the obligation; and the amount has been reliably estimated.

Where there are a number of similar obligations for each claim type, the likelihood that an outflow will be required in settlement is determined by considering the class of obligations as a whole. A provision is recognised even if the likelihood of an outflow with respect to any one item included in the same claim type may be small.

The value of each claims provision is measured as the central estimate of the present value of expected future payments against claims incurred at the reporting date. The expected future payments are discounted to present value using a risk adjusted rate.

The expected future payments include those in relation to claims reported but not yet paid, claims incurred but not reported (IBNR) and anticipated claims handling costs. Claims handling costs include costs that can be associated directly with individual claims, such as legal and other professional fees, and costs that can only be indirectly associated with individual claims, such as claims administration costs.

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1.6 Revenue

The revenues described in this note are revenues relating to the core operating activities of Comcare.

Revenues from government: The full amount of the appropriation for departmental outputs for the year is recognised as revenue.

Special appropriations are available to meet both workers’ compensation related expenses and asbestos related disease settlement claims. Where special appropriations are drawn down in excess of that estimated to meet expenses in the financial year, the excess is offset against the special appropriation receivable asset. Special appropriation revenue is reduced by this amount in the following year.

Revenue from the rendering of a service is recognised by reference to the stage of completion of contracts at the reporting date. The revenue is recognised when:

• The amount of revenue, stage of completion and transaction costs incurred can be reliably measured; and

• The probable economic benefits with the transaction have flowed to the entity.

Receivables for goods and services are recognised at the nominal amounts due less any provision for bad and doubtful debts. Collectability of debts is reviewed at balance date. Provisions are made when collectability of the debt is no longer probable.

Revenue from disposal of non-current assets is recognised when control of the asset has passed to the buyer.

Interest income is recognised on an effective interest basis taking into account the interest rates applicable to the financial assets.

1.7 Transactions with the Government as Owner

Restructuring of Administrative Arrangements

Net assets received from another Commonwealth agency or authority under a restructuring of administrative arrangements are recognised at their book value immediately prior to transfer.

1.8 Employee Benefits

Liabilities for services rendered by employees are recognised at the reporting date to the extent that they have not been settled. Liabilities for short term employee benefits (ie. wages and salaries, a designated portion of annual leave etc, expected to be settled within 12 months of their reporting date) are measured at their nominal amounts. The nominal amount is calculated with regard to the rates expected to be paid on settlement of the liability.

All other employee benefit liabilities are measured as the present value of the estimated future cash outflows to be made in respect of services provided by employees up to the reporting date.


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Leave

The liability for employee benefits includes provision for annual leave and long service leave. No provision has been made for sick leave as all sick leave is non-vesting and the average sick leave taken in future years by employees of Comcare is estimated to be less than the annual entitlement for sick leave.

The leave liabilities are calculated on the basis of employees’ remuneration, including Comcare’s employer superannuation contribution rates to the extent that the leave is likely to be taken during service rather than paid out on termination.

The liability for long service leave is recognised and measured at the present value of the estimated future cash flows to be made in respect of all employees at 30 June 2006. In determining the present value of the liability, attrition rates and pay increases through promotion and inflation have been taken into account.

All annual leave liabilities have been classified as current on the basis that Comcare does not have an unconditional right to defer settlement of the liability for at least twelve months after reporting date. Similarly with long service leave only those liabilities where an unconditional right to settlement exists have been classified as current.

Separation and Redundancy

Provision is also made for separation and redundancy payments in circumstances where Comcare has formally identified positions as excess to requirements and a reliable estimate of the amount of the payments can be determined.

Superannuation

Comcare employees contribute to the Commonwealth Superannuation Scheme (CSS) and the Public Sector Superannuation Scheme (PSS) which are both defined benefit schemes. The liability for their superannuation benefits is recognised in the financial statements of the Australian Government and is settled by the Australian Government in due course.

Comcare makes employer contributions to the Australian Government at rates determined by an actuary to be sufficient to meet the cost to the Government of the superannuation entitlements of Comcare’s employees.

New employees (from 1 July 2005) are eligible to join the new PSS Accumulation Scheme which is a defined contribution scheme. The liability for superannuation recognised as at 30 June represents the estimated value of superannuation that will be paid when the annual or long service leave liabilities are paid.

1.9 Leases

Comcare has a number of operating leases which have been classified as such because the lessor, rather than Comcare, effectively retains substantially all the risks and benefits incidental to the ownership of the leased assets.

Operating lease payments are expensed on a straight line basis unless another systematic approach is more representative of the pattern of benefits derived from the leased assets.

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Lease incentives taking the form of rent holidays are recognised as liabilities. These liabilities are reduced by allocating lease payments between rental expense and reduction of the liability.

1.10 Cash

Cash means notes and coins held and any deposits held at call with a bank or financial institution. Cash is recognised at its nominal amount.

1.11 Financial Instruments

Accounting policies in relation to financial instruments are disclosed in Note 16.

1.12 Contingent Liabilities

Contingent Liabilities are not recognised in the Balance Sheet but are disclosed in the relevant schedules and notes. They may arise from uncertainty as to the existence of a liability, or represent an existing liability in respect of which settlement is not probable or the amount cannot be reliably measured. Where settlement becomes probable, a liability is recognised. A liability is recognised when its existence is confirmed by a future event, settlement becomes probable or reliable measurement becomes possible.

1.13 Acquisition of Assets

Assets are recorded at cost on acquisition except as stated below. The cost of acquisition includes the fair value of assets transferred in exchange and liabilities undertaken.

Assets acquired at no cost, or for nominal consideration, are initially recognised as assets and revenues at their fair value at the date of acquisition, unless acquired as a consequence of restructuring of administrative arrangements. In the latter case, assets are initially recognised as contributions by owners at the amounts at which they were recognised in the transferor agency’s accounts immediately prior to the restructuring.

1.14 Infrastructure, Plant and Equipment

Asset Recognition Threshold

Purchases of infrastructure, plant and equipment are recognised initially at cost in the Balance Sheet, except for purchases costing less than $3,000, which are expensed in the year of acquisition (other than where they form part of a group of similar items which are significant in total).

Depreciation and Amortisation

Depreciable infrastructure, plant and equipment is written off to its estimated residual values over its estimated useful life to Comcare using the straight-line method of depreciation. Leasehold improvements are amortised on a straight-line basis over the lesser of the estimated useful life of the improvements or the unexpired period of the lease, whichever is shorter.

Depreciation rates (useful lives) and methods are reviewed at each reporting date and necessary adjustments are recognised in the current, or current and future reporting periods, as appropriate.


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Depreciation rates applying to each class of depreciable asset are based on the following useful lives:

2005/06 2004/05

Office Machines and Equipment 2-10 years 2-10 yearsLeasehold Improvements Lease term Lease termMotor Vehicles 2 years 2 years

The aggregate amount of depreciation allocated for each class of asset during the reporting period is disclosed at Note 8.

Revaluations

Infrastructure, plant and equipment are carried at fair value, being revalued with sufficient frequency such that the carrying amount of each asset class is not materially different, at reporting date, from its fair value. Valuations undertaken in each year are as at 30 June.

Fair values for each class of assets are determined as shown below:

Asset Class Fair Value Measured At:Office Machines and Equipment Best available market evidenceLeasehold Improvements Depreciated replacement costMotor Vehicles Market selling price

Following initial recognition at cost, valuations are conducted with sufficient frequency to ensure that the carrying amounts of assets do not materially differ to the assets’ fair values as at the reporting date. The regularity of independent valuations depends upon the volatility of movements in market values for the relevant assets.

Revaluation adjustments are made on a class basis. Any revaluation increment is credited to equity under the heading of asset revaluation reserve except to the extent that it reverses a previous revaluation decrement of the same asset class that was previously recognised through profit and loss. Revaluation decrements for a class of assets are recognised directly through profit and loss except to the extent that they reverse a previous revaluation increment for that class.

Any accumulated depreciation as at the revaluation date is eliminated against the gross carrying amount of the asset and the net amount restated to the revalued amount of the asset.

1.15 Intangibles

Comcare’s intangibles comprise computer software which is carried at cost. Computer software represents Comcare’s costs of the purchase of software licences. Comcare does not capitalise the costs of internally generated software as the annual cost of internally generated software approximates the amount that would be amortised each year if these costs were capitalised. All software assets are assessed for impairment on an annual basis.

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Intangible assets are amortised on a straight line basis over their anticipated useful lives. Useful lives are estimated at:

2005/06 2004/05Computer Software 3-5 years 3-5 years

1.16 Impairment of Non-Current Assets

Non-current assets carried at fair value at the reporting date are not subject to impairment testing. The non-current assets carried at cost which are not held to generate net cash inflows, are assessed for indications of impairment on an annual basis.

1.17 Taxation

Comcare is exempt from all forms of taxation except for fringe benefits tax and the goods and services tax (GST).

Revenues, expenses and assets are recognised net of GST:

• except where the amount of GST incurred is not recoverable from the Australian Taxation Office (ATO); and

• except for receivables and payables.

The net amount of GST recoverable from, or payable to, the ATO is included as part of receivables or payables in the Balance Sheet. Cash flows are included in the Cash Flow Statement on a gross basis and the GST component of cash flows arising from investing and financing activities, which is recoverable from or payable to the ATO are classified as operating cash flows.

1.18 Insurance

Comcare has insured for various business risks through the Australian Government’s insurable risk managed fund, called ‘Comcover’.

1.19 Comparatives

Comparatives have been restated where applicable to ensure consistency with current year accounting policies.

1.20 Events after Balance Sheet date

There were no events after the Balance Sheet date.


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2 — THE IMPACT OF THE TRANSITION TO AEIFRS FROM PREVIOUS AGAAP

30 June 2005$’000s

1 July 2004$’000s

Reconciliation of total equity as presented under previous AGAAP to that under AEIFRS

Total equity under previous AGAAP 35,877 10,151

Adjustments to retained earnings:

Decrease in special appropriation receivable (note a) (149,400) (136,830)

Decrease in third party claim recoveries (note a) (2,600) (1,700)

Decrease in claims provisions (note a) 152,000 138,530

Decrease in employee provisions (note b) 60 48

Increase in ‘Makegood’ asset (note c) 470 585

Decrease in Other provisions (note c) (585) (585)

Total equity translated to AEIFRS 35,822 10,199

Reconciliation of profit or loss as presented under previous AGAAP to AEIFRS

Prior year profit as previously reported 25,725

Adjustments:

Decrease in revenues from government (note a) (32,002)

Decrease in workers’ compensation claims expenses (note a) 32,002

Decrease in annual leave expense (note b) 12

Increase in depreciation expense (note c) (115)

Prior year profit translated to AEIFRS 25,622

The cash flow statement presented under previous AGAAP is equivalent to that prepared under AEIFRS.

(a) As a result of the transition to AEIFRS, Comcare is not required to comply with AASB 1023 General Insurance Contracts as its business (both premium and pre-premium) is not considered to be underpinned by contracts of insurance with its customers. Contract of insurances need to be in existence in order for a reporting entity to apply AASB 1023.

The impact of this change is that the premium and pre-premium business liabilities are now reported under AASB 137 Provisions, Contingent Liabilities and Contingent Assets. The measurement of liabilities under AASB 137 is based on a best estimate which management believes in the context of Comcare’s business equates to the central estimate of claims liabilities (ie. without an explicit risk margin). Under AGAAP the premium and pre-premium liabilities both included a risk margin of 10.6%. The withdrawal of the risk margin resulted in a reduction in claims liabilities at 1 July 2004 and 30 June 2005 of the following amounts:

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pre-premium ($58.4m) and premium ($93.6m). Corresponding to the decrease in the level of claims liabilities the amount of special appropriation receivable recognised to fund these liabilities has also decreased.

(b) Where wages, salaries, annual leave and sick leave are not short-term employee benefits, AASB 119 requires the associated liabilities to be measured at present value. Under AEIFRS, Comcare has remeasured the provision for annual leave as at 30 June 2005 to reflect the present value of the expected future payments resulting in a decrease in the recorded liability of $60,000. In the Income Statement this resulted in a reduction of $12,000 in leave expenses during 2004/05.

(c) Under AEIFRS, AASB 116 Property, Plant and Equipment requires that the cost of an item of infrastructure, plant or equipment includes the initial estimate of the cost of dismantling and restoring the site where such an obligation arises from the use of the asset. This requirement did not exist under AGAAP. The value of this ‘make good’ for refitting of office space is considered material for leased properties in both Melbourne and Canberra. Comcare recognised an additional $585,000 as a non-current asset as at 30 June 2004 with an equivalent provision recorded as a liability. The asset is being amortised on a straight line basis over the remaining term of the respective leases. This will result in an additional $115,000 being charged to expense each year until 2008/09.

3 — DISCLOSURE OF FUNDING FOR COMCARE

As referred to in Note 1, workers’ compensation claims resulting from injuries that occurred prior to 1 July 1989 are referred to as ‘pre-premium’ claims. Expenses associated with these claims are funded from Australian Government special appropriations. Comcare’s actuary has estimated that the outstanding liability for these claims as at 30 June 2006 is $455.5m (2005: $502.1m).

In accordance with Section 97C of the SRC Act, Comcare calculates premiums to be charged for each financial year based on the liability for claims expected to be incurred during that year and estimated administrative costs for that year. The calculation of the Comcare premium pool takes into account notional interest expected to be earned on the premium funds collected.

Prior to being repealed (effective 1 July 2002), Section 97A(1) of the SRC Act required that premiums collected by Comcare be paid to the Australian Government. The Act does not presently provide for those premium funds (or the notional interest accrued) to be brought to account as assets of Comcare. Accordingly these financial statements do not reflect these amounts, except insofar as they are required to meet existing outstanding claims obligations.

Funds available under this arrangement are estimated to be $1,022.1m as at 30 June 2006 (30 June 2005, $966.2m). This amount represents the balance of premiums paid to the Australian Government less claim payments and associated expenses. This amount includes notional interest of $56m in 2005/06 (2004/05 $51.6m) calculated as part of the requirements of Section 90C of the SRC Act. The interest rate used is the rate of return on 6 month overnight indexed swaps as reported by the Reserve Bank of Australia. These funds will be returned


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to Comcare through parliamentary appropriations as required for payment of claims relating to incidents occurring between 1 July 1989 and 30 June 2002. An independent actuary has assessed the premium funded net outstanding liability (excludes third party recoveries) as at 30 June 2006 as $957.7m (2005: $857.9m). The notional reserve is $64.4m which is in addition to Comcare’s net equity of $71.3m at 30 June 2006.

2005/06$’000s

2004/05$’000s

3(a) Premium Business – Notional Reserve

Net premiums held in the Commonwealth Official Public Account

1,022,176 966,177

Actuary assessed net outstanding liability for payment of premium related claims

(957,720) (857,900)

Notional reserve as at 30 June 64,456 108,277

3(b) Premium Business – Operating Result

The operating result relates to Comcare’s premium business and does not include costs or liabilities for injuries or illness sustained prior to 1 July 1989.

Premium Revenue 212,177 191,580

Less: Claims expenses (264,780) (280,229)

Claims management expenses (23,258) (21,226)

Underwriting expenses (465) (409)

Total claims expenses and underwriting expenses (288,503) (301,864)

Underwriting result (76,326) (110,284)

Add: Interest earned (including notional interest receivable from the Commonwealth)

62,791 58,361

Operating Result – Premium Business (13,535) (51,923)

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4 — CRITICAL ACCOUNTING JUDGEMENTS AND ESTIMATES

Comcare makes estimates and assumptions in respect of certain key assets and liabilities. Estimates and judgements are continually evaluated and are based on historical experience and other factors, including expectations of future events that are believed to be reasonable under the circumstances. The key areas in which critical estimates are applied are described below.

A judgement has been made regarding the application of AASB 137 Provisions, Contingent Liabilities and Contingent Assets to the premium workers’ compensation business. Although such business exhibits many of the characteristics of insurance it was judged that Comcare’s relationship with its customers was not based on a contract of insurance as required by AEIFRS and therefore AASB 1023 General Insurance Contracts could not be applied. Further details of the impact of this judgement have been disclosed in Note 2.

The ultimate liability arising from claims made

Provision is made at the year end for the estimated cost of claims incurred but not settled at the reporting date, including the cost of claims incurred but not yet reported to Comcare.

The estimated cost of claims includes direct expenses to be incurred in settling claims gross of the expected value of recoveries. Comcare takes all reasonable steps to ensure that it has appropriate information regarding its claims exposures. However, given the uncertainty in establishing claims provisions, it is likely that the final outcome will prove to be different from the original liability established.

The estimation of claims Incurred But Not Reported (IBNR) is generally subject to a greater degree of uncertainty than the estimation of the cost of settling claims already notified to Comcare, where more information about the claim event is generally available. IBNR claims may often not be apparent to the insured until many years after the events giving rise to the claims has happened. In calculating the estimated cost of unpaid claims Comcare uses a variety of estimation techniques, generally based upon statistical analyses of historical experience, which assumes that the development pattern of the current claims will be consistent with past experience. Allowance is made, however, for changes or uncertainties which may create distortions in the underlying statistics or which might cause the cost of unsettled claims to increase or reduce when compared with the cost of previously settled claims including:• changes in Comcare processes which might accelerate or slow down the development

and/or recording of paid or incurred claims, compared with the statistics from previous periods;

• changes in the legal environment;• the effects of inflation;• movements in industry benchmarks; or• medical and technological developments.

Details of specific assumptions used in deriving the claims liabilities at year end are detailed in Note 10(E)-(G).


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Valuation of Long Service Leave Provision

The liability for long service leave is recognised and measured at the present value of the estimated future cash flows to be made in respect of all employees at 30 June 2006. The provision was discounted by 12.8% as at 30 June 2006 and by 5% as at 30 June 2005.

2005/06$’000s

2004/05$’000s

5 – INCOME

REVENUES

5(a) Revenue from Government

Special appropriation drawn down 58,209 67,222

Add: appropriation received in advance in the previous year 8,952 4,713

Less: appropriation received in advance in the current financial year (6,651) (8,952)

Annual appropriations60,510 62,983

762 469

Add: funding for movement in claims provisions61,272 63,452

104,920 116,900

Total revenues from Government 166,192 180,352

5(b) Revenue from Goods and Services

Goods 9 2

Services 12,186 8,515

Licence fees 2,586 2,427

Total sale of goods and services 14,781 10,944

Provision of goods to: External entities 9 2

Total sale of goods 9 2

Rendering of services to: Related entities 11,936 8,112

Rendering of services to: External entities 250 403

Total rendering of services 12,186 8,515

5(c) Workers’ Compensation Premiums

Related entities 179,630 160,827

External entities 32,547 30,753

Total workers’ compensation premiums 212,177 191,580

5(d) Interest

Deposits 9,244 6,792

Total interest 9,244 6,792

5(e) Other

Miscellaneous 54 623

Total other revenues 54 623

TOTAL REVENUES 402,448 390,291

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2005/06$’000s

2004/05$’000s

6 – OPERATING EXPENSES

6(a) Employee Expenses

Wages and salaries 18,714 17,055

Superannuation 3,373 3,010

Leave and other entitlements 2,200 2,268

Separation and redundancies 188 113

Other 387 433

Total employee expenses 24,862 22,879

6(b) Suppliers

Goods from external entities 476 343

Services from related entities 882 759

Services from external entities 10,664 9,832

Operating lease rentals 2,246 1,999

Total supplier expenses 14,268 12,933

6(c) Depreciation and Amortisation

Depreciation

Infrastructure, plant and equipment 768 537

Total depreciation 768 537

Amortisation

Leasehold improvements 645 661

Intangibles – computer software 172 185

Total amortisation 817 846

Total depreciation and amortisation 1,585 1,383

6(d) Net loss from sale of assets

Infrastructure, plant and equipment:

Proceeds from disposal (102) (103)

Net book value of assets disposed 154 105

Total net loss from disposal of assets 52 2

Total administrative expenses 40,767 37,197

6(e) Workers’ compensation claims expense

Workers’ compensation claims expenses paid and payable (gross) 215,181 210,572

Add/(less) net movement in workers’ compensation claims provision 53,220 100,100

Total workers’ compensation claims expense 268,401 310,672


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2005/06$’000s

2004/05$’000s

6(f) Pre-premium claims expense

Incapacity 36,234 39,068

Legal including common law 1,711 6,376

Medical, travel and other 12,497 13,003

50,442 58,447

Less: Recoveries from third parties (221) (404)

50,221 58,043

Add movements during reporting period:

Pre-premiums claims provision (46,600) (27,600)

Total pre-premium claims expense 3,621 30,443

6(g) Premium claims expense

Incapacity 95,049 89,998

Legal including common law 10,999 12,676

Medical, travel and other 62,977 55,111

169,025 157,785

Less: Recoveries from third parties (4,065) (5,256)

164,960 152,529

Add movements during reporting period:

Premiums claims provision 102,620 136,200

Recoveries receivable (2,800) (8,500)

99,820 127,700

Total premium claims expense 264,780 280,229

6(h) Common law asbestos related disease claims expense

Common law asbestos related disease claim payments 6,541 -

Add net movements during reporting period:

Common law asbestos related disease claims provision 51,700 16,800

Total common law asbestos related disease claims expense 58,241 16,800

7 – FINANCIAL ASSETS

7(a) Cash and cash equivalents

Cash at bank and on hand 1,884 7,565

Deposits at call 8,610 39,744

Term deposits 73,000 -

Total cash 83,494 47,309

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2005/06$’000s

2004/05$’000s

7(b) Receivables

Goods and services 182 199

Workers’ compensation premiums 1,044 268

Less: Provision for doubful debts - (4)

1,226 463

Appropriations receivable 2,177,669 1,367,848

Third party claim recoveries receivable 27,500 24,700

Third party claim recoveries receivable – common law asbestos claims 37,700 -

65,200 24,700

Claims recoveries 3,679 4,142

Other receivables 379 722

Less: Provision for doubful debts (1,009) (1,329)

3,049 3,535

Total receivables 2,247,144 1,396,546

Current receivables 259,029 204,446

Non-current receivables 1,988,115 1,192,100

Receivables (gross) are aged as follows:

Current 2,245,092 1,394,830

Overdue less than 30 days 65 168

Overdue 30 days to 60 days 33 85

Overdue 61 days to 90 days 20 67

Overdue more than 90 days 2,943 2,729

Total receivables (gross) 2,248,153 1,397,879

The provision for doubtful debts is aged as follows:

Overdue more than 90 days (1,009) (1,333)

Total provision for doubtful debts (1,009) (1,333)

7(c) Other financial assets

Shares in controlled entities - 20

QWL Pty Ltd, the only subsidiary of Comcare, was deregistered during the year.

7(d) Accrued revenues

Interest accrued 143 70

Other 37 16

Total accrued revenues (current asset) 180 86


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2005/06$’000s

2004/05$’000s

8 – NON-FINANCIAL ASSETS

8(a) Infrastructure, plant and equipment

Office machines and equipment

Fair value 1,491 3,055

Accumulated depreciation - (1,085)

Net book value 1,491 1,970

Leasehold improvements


Accumulated amortisation - (1,030)

Net book value 2,531 2,422

Motor vehicles

Fair value 269 205

Accumulated depreciation - (28)

Net book value 269 177

Total infrastructure, plant and equipment


Accumulated depreciation/amortisation - (2,143)

Total net book value (non-current asset) 4,291 4,569

All revaluations are independent and conducted in accordance with the revaluation policy stated in Note

1. In 2005/06, an independent revaluation was conducted by Mr N. Spoljaric (Certified Practising Valuer,

Australian Valuation Office). A revaluation increment of $256,755 for infrastructure, plant and equipment

was credited to the asset revaluation reserve (2005: Nil).

8(b) Intangibles

Computer software purchased

At cost 8,184 8,033

Accumulated amortisation (7,903) (7,731)

Total net book value (non-current asset) 281 302

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Item

Otherinfrastructure,

plant & equipment

Computersoftware

purchasedTOTAL

$’000 $’000 $’000

As at 1 July 2005

Gross book value 6,712 8,033 14,745

Accumulated depreciation/amortisation (2,143) (7,731) (9,874)

Opening net book value 4,569 302 4,871

Additions:

By purchase 1,121 151 1,272

Net revaluation increment/(decrement) 168 168

Depreciation/amortisation expense (1,413) (172) (1,585)

Disposals:

Other disposals (154) - (154)

As at 30 June 2006

Gross book value 4,291 8,184 12,475

Accumulated depreciation/amortisation - (7,903) (7,903)

Closing net book value 4,291 281 4,572

Table 8.1 Reconciliation of the Opening and Closing Balances of Infrastructure, Plant and Equipment and Intangibles

2005/06$’000s

2004/05$’000s

8(c) Other non-financial assets

Prepayments 294 393

Total other financial assets 294 393

9 – PAYABLES

9(a) Payables to suppliers

Trade creditors 1,381 1,190

Total suppliers 1,381 1,190

9(b) Workers’ compensation claims payable 2,723 2,711


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10 – PROVISIONS

10(a) Employee provisions

Salaries and wages 256 86

Superannuation 915 805

Leave 5,419 5,391

Separations and redundancies 67 30

Total employee provisions 6,657 6,312

Current 5,115 5,014

Non-current 1,542 1,298

10(b) Workers’ compensation claims

Premium workers’ compensation claims 10(F) 985,220 882,600

Pre-premium workers’ compensation claims 10(G) 455,500 502,100

1,440,720 1,384,700

10(c) Common law asbestos related disease claims 10(H) 808,800 16,800

10(d) Other provisions

Makegood on leases 10(E) 551 585

Total other provisions 551 585

Total Provisions 2,256,728 1,408,397

Current 268,935 216,814

Non-current 1,987,793 1,191,583

10(e) Provision for Makegood reconciliation

Carrying amount at beginning of period 585

Additional provision made 55

Decrease in provision as a result of revaluation (89)

Carrying amount at the end of period 551

Comcare currently has five agreements for the leasing of premises which have contract clauses requiring it to restore the premises to their original condition at the conclusion of the lease. Comcare has made a provision to recognise this obligation.

2005/06$’000s

2004/05$’000s

9(c) Other

Income in advance 2,627 112

GST payable 122 40

Lease incentives 491 655

Other 287 299

Total other 3,527 1,106

Total payables 7,631 5,007

Current 7,049 4,261

Non-current 582 746

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2005/06$’000s

10(f) Provision for Premium claims

Carrying amount at beginning of period 882,600

Additional provisions made during the period 252,695

Less claim payments made during the period (164,689)

Unwind discount 52,457

Change in discount rate (37,843)

Carrying amount at the end of period 985,220

The valuation of premium claims liabilities was undertaken as at 30 June 2006 by an independent firm

of consulting actuaries, Taylor Fry Pty Ltd. Taylor Fry has stated that its valuation complies with actuarial

Professional Standard PS300 titled ‘Actuarial reports and advice on general insurance technical liabilities’.

The estimates of the liabilities are central estimates.

The provision for premium claims represents an actuarial assessment of the central estimate of expected

payments to be made in the future by Comcare in relation to workers’ compensation claims incurred on or

after 1 July 1989. The provision is recognised on a gross basis after adding back an estimate for third party

recoveries.

A change in accounting policy has resulted in a significant proportion of potential statutory claims for

asbestos related diseases being derecognised as liabilities and recorded as contingent liabilities instead.

This has been done on the basis of a recent Federal Court decision, Comcare v Etheridge and Ors [2006]

FCAFC 27, where it was held that the inhalation of an asbestos fibre by an employee was not an ‘injury

simpliciter’ or frank injury. Accordingly the date of injury must be determined in accordance with s7(4) of

the SRC Act which fixes the date of injury according to the earliest of the dates on which the employee dies,

becomes incapacitated, impaired or seeks medical treatment as a result of the disease.

The result of this finding is that liabilities that were previously treated as pre-premium on the basis that the

injury occurred on the date of exposure to asbestos (which was generally prior to the commencement of

the premium scheme), must now be determined to have a date of injury pursuant to s7(4), which now falls

within the premium period. As a consequence of this change, $32.5m has been de-recognised from the

pre-premium provision and the opening premium claims liability has been increased by $2.9m. Statutory

asbestos claims which are anticipated but where the date of injury has not yet been determined are

disclosed as a $38.9m contingent liability as at 30 June 2006.

Key assumptions that have been made in determining the amount of the provision include:

2005/06 2004/05

Economic assumptions

Medical payments 5.5% 5.2%

Other payments 3.6% 4.3%

Discount rate 5.8% 5.3%

Premium business liability assumptions

Claim frequency 3.0% 3.1%

Third party recoveries 3.6% 4.7%

Claims adminitration expenses 9.8% 7.8%

Average claim size $30,224 $28,915


121

2005/06$’000s

10(g) Provision for Pre-Premium claims


Additional provisions made during the period 9,784

Less claim payments made during the period (50,884)

Unwind discount 26,600

Change in discount rate (32,100)


The valuation of premium claims liabilities was undertaken as at 30 June 2006 by an independent firm of consulting actuaries, Taylor Fry Pty Ltd. Taylor Fry has stated that its valuation complies with actuarial Professional Standard PS300 titled ‘Actuarial reports and advice on general insurance technical liabilities’. The estimates of the liabilities are central estimates.

The provision for pre-premium claims represents an actuarial assessment of the central estimate of expected payments to be made by Comcare in relation to workers’ compensation claims incurred prior to 1 July 1989.

2005/06 2004/05


Medical payments 5.5% 5.2%

Other payments 3.6% 4.3%

Discount rate 5.8% 5.3%

10(h) Provision for common law asbestos related disease claims


Transfer in of common law asbestos related disease claims 756,000

Increase (decrease) in claims incurred over the period 6,000

Claim payments made by Comcare during the period (5,811)

Claim payments made by third parties during the period (note a) (9,089)

Unwinding of discounted amount arising from the passage of time 44,900


The provision for common law asbestos related disease claims represents the management of common law claims against the Australian Government by individuals seeking compensation as a result of direct or indirect exposure to asbestos. Responsibility for this function transferred to Comcare under a restructuring arrangement with Comcare assuming a liability of $756m from the transferring agencies (see Note 11).

The valuation of common law asbestos related disease claims liabilities was undertaken as at 30 June 2006 by an independent firm of consulting actuaries, Finity Consulting Pty Ltd. Finity Consulting has stated that its valuation complies with actuarial Professional Standard PS300 titled ‘Actuarial reports and advice on general insurance technical liabilities’. The estimates of the liabilities are central estimates.

(a) The Department of Defence made payments in respect of certain claims until 30 June 2006. From 1

July 2006 all payments in respect of common law asbestos claims will be made by Comcare.

The following assumptions have been made in determining the amount of the provision:

2005/06 2004/05


Discount rate 6% 6%

Wage inflation 4% 4%

Superimposed inflation 2% 2%

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2005/06$’000s

2004/05$’000s

11 – RESTRUCTURING

As a result of a restructuring of administrative arrangements and enactment of the Asbestos-related

Claims (Management of Commonwealth Liabilities) Act 2005 (ARC Act), Comcare assumed responsibility

for the administration of common law claims against the Commonwealth for asbestos related diseases and

ownership of the related liabilities. The liabilities were transferred to Comcare on 26 October 2005 from

both the Department of Employment and Workplace Relations and the Department of Defence. Payment of

the liabilities which have been transferred is being funded via a special appropriation available under s8 of

the ARC Act.

In respect of functions assumed, the net book values of assets and liabilities transferred to Comcare for no

consideration and recognised as at the date of transfer were:

Total assets recognised 756,000 -

Total liabilities recognised (756,000) -

Net assets assumed - -

12 – CASH FLOW RECONCILIATION

Reconciliation of cash per the Balance Sheet to Cash Flow Statement

Cash at year end per Statement of Cash Flows 83,494 47,309

Balance Sheet items comprising above cash:

‘Financial Assets – Cash’ 83,494 47,309

Reconciliation of operating result to net cash from operating activities:

Operating result 35,039 25,622

Depreciation and amortisation of infrastructure, plant and equipment 1,585 1,383

Write-down of assets 52 2

Changes in assets and liabilities

Increase in receivables (850,598) (137,420)

Increase in accrued revenues (94) (1)

Decrease in prepayments 99 72

Decrease in payables and provisions 851,043 141,207

Net cash from operating activities 37,126 30,865

2005/06$

2004/05$

13 – COMPENSATION AND DEBT RELIEF

Waivers

8 debts were waived in accordance with 114D of the Safety, Rehabilitation and Compensation Act 1988 (2005: 5 debts)

62,075 3,752

Defective Administration Scheme

No payments were made under the ‘Defective Administration Scheme’ during the reporting period. (2005: No payment made)

Nil Nil

Public Service Act 1999

No payments were made under s73 of the Public Service Act 1999during the reporting period. (2005: No payments made)

Nil Nil


123ParticularsDepartmental Outputs

2005/06 2004/05

Year ended 30 June $’000 $’000

Balance carried from previous period 89 -

Appropriation Act (No.1) 521 510

Appropriation Act (No.3) 200 -

Total appropriations available for payments 810 510

Cash payments made during the year (695) (421)

Balance of Authority to draw cash from the CRF for Ordinary Annual Services Appropriations

115 89

Represented by:

Cash at bank 115 89

Table 15(a)

Table A: Acquittal of Authority to Draw Cash from the Consolidated Revenue Fund for Ordinary Annual Services Appropriations

Both Tables A and B are from the perspective of the use of the Consolidated Revenue Fund (CRF) – that is

payments made to Comcare.

14 – CONTINGENT LIABILITIES

The Schedule of Contingencies reports a contingent liability in respect of future statutory workers’ compensation claims for asbestos related diseases in the amount of $38.9m (2005:$32.5m). This contingency relates to a recent test case in the Federal Court, Comcare v Etheridge and Ors [2006] FCAFC 27. For further details of the financial implications of this case refer to Note 10(F). $7.7m of the contingency relates to Comcare seeking leave to appeal to the High Court with respect to various elements of the court ruling including whether it is liable to make claim payments to the parties concerned and claimants in other similar cases.

The contingent liability of $22.5m relates to 17 claims which have been lodged by BHP Billiton against the Commonwealth arising from the exposure to asbestos of BHP Whyalla Shipyards employees, contractors and their employees during the construction of ships that was subsidised by the Commonwealth. Any liability of the Commonwealth or Comcare to indemnify BHP Billiton or otherwise contribute to damages paid or payable to those persons by BHP Billiton is denied.

15 – APPROPRIATIONS

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Safety, Rehabilitation and Compensation Act 1988 (SRC Act) – s90D

Departmental

2005/06 2004/05

$’000 $’000

Purpose: to pay workers’ compensation claims and associated expenses in accordance with the provisions of the SRC Act.

Outcome 1

Cash payments made during the year 54,716 61,460

Budget estimate 61,379 72,022

The variance between the cash payments made during the year and the budget estimate is due mainly to deceased lump sum and common law payments together with reduced incapacity expenses.

Table 15(b)

Table B: Acquittal of Authority to Draw Cash from the Consolidated Revenue Fund - SpecialAppropriations (Limited Amount)

Asbestos-related Claims (Management of Commonwealth Liabilities) Act 2005 – s8(2)

Purpose: To pay asbestos related personal injury common law disease claims against the Commonwealth.

Outcome 1

Cash payments made during the year 5,811 -

Budget estimate 13,782 -

The variance between the cash payments made during the year and the budget estimate is largely the result of a lower than expected number of settlements being made during the year.

Total for unlimited special appropriations

Payments made 60,527 61,460

An amount of $6.6m drawn from the CRF during 2005/06 to meet liabilities incurred under these Acts had not been disbursed at that date and was held in Comcare’s bank account (30 June 2005: $8.9m)

Budget estimate 75,161 72,022


125

Financialinstrument Notes

Accounting policies and methods(including recognition criteria and measurement basis)

Nature of underlying instrument(including significant terms affecting the amount, timing and certainty of cash flows)

Financial assets:Deposits at callTerm Deposits

7(A) Deposits are recognised at their nominal amounts, interest is credited to revenue as it accrues.

Temporary surplus funds, mainly from premium receipts and fortnightly draw downs of appropriation are placed on deposit at call with the short-term money market or on short term deposit. Interest on at call funds is earned on the daily balance and is paid at month end.

Receivables for goods and services

7(B) These receivables are recognised at the nominal amounts due less any provision for bad and doubtful debts. Provisions are made when collection of the debt is judged to be less likely rather than more likely.

Credit terms are net 30 days.

(2005: 30 days)

Appropriations Receivable

7(B) Appropriations receivable are valued in accordance with net outstanding claims liabilities but are adjusted for funds received in excess of that required for expenses during the financial year.

Claims expense recoveries

7(B) These receivables are recognised at the nominal amounts.

Credit terms are net 30 days.

(2005: 30 days)

Financial liabilities:Trade creditors 9(A) Creditors and accruals are

recognised at their nominal amounts, being the amounts at which the liabilities will be settled. Liabilities are recognised to the extent that the goods and services have been received (and irrespective of having been invoiced).

Settlement is usually made net 30 days.

Workers’ compensation payables

9(B) Workers’ compensation payables are recognised at their nominal amounts, being the amounts at which the liabilities will be settled.

Provisions 10 Provisions for workers’ compensation claims and for common law asbestos related disease claims are recognised at their present value. For employee provisions, long service leave and a small portion of the recreation leave are discounted to present value. The remainder of the recreation leave and the other provisions are recognised at their nominal value.

16 – FINANCIAL INSTRUMENTS

16(a) Terms, conditions and accounting policies

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127

16(c) Net fair value of financial assets and liabilities

The net fair value of each class of Comcare’s financial assets and liabilities equal their carrying amounts in both the current and immediately preceding reporting periods, and none of these financial assets or liabilities are readily traded on organised markets in a standardised form.

17 – REPORTING OF OUTCOMES AND OUTPUTS

Note 17A: Outcomes and outputs

Comcare is structured to meet one outcome: Minimise human and financial costs of workplace injury under schemes administered by Comcare and ensure that claimants receive compensation in accordance with Commonwealth obligations.

The following outputs are identified with the outcome:

Output 1.1 SRC Act regulationOutput 1.2 OHS (CE) Act regulationOutput 1.3 Management of premium claimsOutput 1.4 Management of pre-premium claimsOutput 1.5 Regulation of the Seacare scheme for workers’ compensation, rehabilitation and occupational health and safetyOutput 1.6 Management of asbestos related personal injury common law disease claims against the Commonwealth

Note 17B: Net Cost of Outcome Delivery

Outcome 1 Total

2005/06 2004/05 2005/06 2004/05

$’000s $’000s $’000s $’000s

Expenses

Departmental expenses 367,409 364,669 367,409 364,669

Total expenses 367,409 364,669 367,409 364,669

Costs recovered

Departmental 189,521 168,939 189,521 168,939

Total costs recovered 189,521 168,939 189,521 168,939

Other external revenues

Departmental

Premiums 34,592 30,753 34,592 30,753

Licence fees 2,586 2,427 2,586 2,427

Provision of goods 9 2 9 2

Rendering of services 250 403 250 403

Interest on deposits 9,244 6,792 9,244 6,792

Other revenue 54 623 54 623

Total other external revenues 46,735 41,000 46,735 41,000

Net cost/(contribution) of outcome 131,153 154,730 131,153 154,730

Comcare’s outcome/outputs are described at Note 17A.The net costs shown include intra-government costs that would be eliminated in calculating the actual budget outcome.

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129

18 – REINSURANCE

ReinsuranceThe Department of Finance and Administration has undertaken to supplement Comcare’s premium pool in the event of a single incident in which costs in excess of $5,000,000 arise.

19 – REMUNERATION OF AUDITORS

The cost of financial statement audit services provided to Comcare were:

2005/06 2004/05 $ $

Audit services 167,875 159,160

PricewaterhouseCoopers (PwC) have been contracted by the ANAO to provide audit services on the ANAO’s behalf. For the 2004/05 financial statements the ANAO contracted Ernst & Young to provide these services. The fees for these services are included in the above figures.

20 – REMUNERATION OF DIRECTORS

The number of directors of Comcare included in these figures is shown below in the relevant remuneration bands.

2005/06 2004/05

$30,000-$44,999 - 1 $160,000-$174,999 - 1 $250,000-$264,999 1 -Total number of directors of Comcare 1 2

Total remuneration received or due and receivable $ $

250,141 197,181

21 – EXECUTIVE REMUNERATION

The number of senior executives who received or were due to receive total remuneration of $130,000 or more:

2005/06 2004/05

$130,000-$144,999 1 2 $145,000-$159,999 - 3 $160,000-$174,999 - 3 $175,000-$189,999 - 3 $265,000-$279,999* 1 - 5 6

by the director of Comcare

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The aggregate amount of total remuneration of the executive officers shown above is $1,168,070 (2005: $1,023,141). The items marked * include separation and redundancy payments. The total of separation and redundancy payments included in the above figures is $121,406 (2005: $123,222).

The executive remuneration includes all Senior Executive Officers concerned with or taking part in the management of Comcare during 2005/06 except the Director. Details in relation to the Director have been incorporated into Note 20 Remuneration of Director.

22 – RELATED PARTY DISCLOSURES

22A Safety, Rehabilitation and Compensation Commission

(a) During the year Comcare paid expenses including the remuneration of members of the Commission.

Members of the Commission during the financial year were:

Leslie Taylor (Chairperson)Barbara Bennett Sharelle Herrington (appointed 2 March 2006)Vice Admiral Russell Shalders AO, CSC, RAN (resigned 5 October 2005)Stephen Somogyi Graham Rodda William Scales AO Craig Bosworth (appointed 16 September 2005)Kenneth Gillespie (appointed 2 March 2006)Diane Merryfull (appointed 2 March 2006)Sandra Parker (appointed 2 March 2006)Cheryl Vardon (resigned 28 February 2006)Craig Symon (resigned 31 January 2006)

The Commission is a body established to oversee the regulatory functions of the SRC Act and the Occupational Health and Safety (Commonwealth Employment) Act 1991.

(b) The aggregate amount of remuneration received by the part time members of the Commission, not employed by the Australian Government, but paid by Comcare during the period was $185,830 (2005: $205,519).

22B Seacare Authority

(a) The Seafarers’ Safety, Rehabilitation and Compensation Authority (Seacare Authority) aims to minimise the human and financial costs of workplace injury in the Australian maritime industry. The Seacare Authority administers the Seafarers Rehabilitation and Compensation Act 1992, the Occupational Health and Safety (Maritime Industry) Act 1993, the Seafarers Rehabilitation and Compensation Levy Act 1992 and the Seafarers Rehabilitation and Compensation Levy Collection Act 1992. It performs the regulator role in relation to these Acts.


131

Members of the Seacare Authority during the financial year were:

Mr Geoff Gronow ED (Chairperson)Mr Stewart Ellis (Deputy Chairperson, appointed 5 April 2006)Mr Noel Swails (Deputy Chairperson, resigned 24 March 2006)Mr Mal Hearnden Mr Peter Bremner Mr Mick Doleman Mr Martin Byrne

(b) The aggregate amount of remuneration received by the part time members of the Seacare Authority, not employed by the Australian Government, but paid by Comcare during the period was $7,333 (2005: $5,994).

23 – AVERAGE STAFFING LEVELS

The average staffing levels for Comcare at 30 June were:

2005/06 2004/05

Average staffing levels 360 370

24 – RESOURCES PROVIDED FREE OF CHARGE

Comcare received no material resources provided free of charge during the financial year. Comcare performs administration functions for the Seacare Authority. Annual Appropriation is provided by the Australian Government for this purpose. Expenditure recorded under Output Group 1.5 in Table 17C “Departmental Revenues and Expenses by Outputs” represents resources provided free of charge by Comcare to the Seacare Authority.

25 – ASSETS HELD IN TRUST

Comcare Beneficiaries Trust Account (BTA)

The BTA was established on 1 December 1988 to administer compensation benefits paid under both the Compensation (Commonwealth Government Employees) Act 1971 and the SRC Act to beneficiaries that are under a legal disability. The vast majority of these are children under the age of 18 who have been awarded compensation following the death of a parent under compensable circumstances.

Comcare manages the funds awarded by Comcare and the self-administering authorities (ie. Telstra, and Australia Post). No fee is charged by Comcare for this service.

Funds held for dependants of deceased members of the Australian Defence Forces who have a legal disability were transferred on 1 July 2005 to the Military Rehabilitation and Compensation Commission (MRCC) in accordance with section 153(2) of the MilitaryRehabilitation and Compensation (Consequential and Transitional Provisions) Act 2004. The value of the funds transferred was $2,897,456.

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25 – ASSETS HELD IN TRUST

Balance carried forward from previous year 5,155 6,162

Add: Funds deposited 31 127

Interest earned 123 314

Available for payment 5,309 6,603

Less: Transfer to the MRCC 2,897 -

Final payouts 274 1,401

Ad-hoc payments 14 47

Total payments made 3,185 1,448

Balance carried forward to next year held by Comcare 2,124 5,155

Represented by:

Cash at bank 2,124 5,155

2,124 5,155

2005/06$’000s

2004/05$’000s

133

APPENDICES

AP

PEN

DIC

ES

134

Section 8 of the Freedom of Information Act 1982

(FOI Act) requires Comcare to publish information

about

• the organisation and functions of the agency

and decision-making powers and other powers

affecting people involved in those functions

• arrangements that exist for outside

participation in agency decision-making

• the categories of documents that the agency

possesses

• how people can gain access to information

held by the agency.

Comcare also provides secretariat support and

assistance to the Commission and the Seafarers

Safety, Rehabilitation and Compensation Authority

including processing of any applications under the

FOI Act.

ORGANISAT ION , FUNCT IONS ANDDEC IS ION-MAK ING POWERSInformation on the organisation, functions and

powers of Comcare can be found within the

Comcare Overview section of this report.

ARRANGEMENTS FOR OUTS IDEPART IC IPAT IONComcare has regular contact with claimants,

employers and other stakeholders. There are formal

and informal consultative mechanisms in place

to allow organisations and people to participate

in the formulation and administration of policy by

Comcare.

These include

• Commonwealth Compensation Liaison

Committee

• Licensee/Comcare Consultative Forum and

• Comcare Customer Seminars.

Comcare also has a general policy of inviting

comment on significant policy issues before

decisions are made. This includes consulting with

industry groups and welcoming feedback from other

interested parties.

CATEGORIES OF DOCUMENTSThe following documents are available for inspection

at Comcare offices or on Comcare’s website.

• Documents relating to administration,

including such matters as personnel, finance,

property and resource management.

• Agreements to which the Commonwealth is a

party, for example, in relation to the provision

to the Commonwealth by the States/Territories

of investigation services.

• Reports relevant to Comcare’s functions.

• Internal publications for the guidance of

Comcare officers and others.

• Hard copy and electronic files on the range of

the organisation’s activities.

Full details of manuals, guidelines and instructions

held within Comcare are in the statement prepared

to comply with Section 9 of the FOI Act and are

available upon request.

Comcare produces a range of publications.

Information about Comcare’s publications may be

obtained by contacting Comcare’s general enquiry

line (1300 366 979), or by visiting Comcare’s

website at www.comcare.gov.au.

APPENDIX 1 : FREEDOM OF INFORMATION


135

ACCESS TO DOCUMENTSUnder section 59 of the SRC Act injured employees

may request copies of all documents relating to their

claims. Similar rights are conferred on employers

to request information or documents held by

Comcare relating to their employees. This method

of requesting documents results in limited numbers

of requests under the FOI Act.

In relation to matters other than claims

management, Comcare will, wherever possible,

meet requests for access to documents that satisfy

the requirements of the FOI Act.

Access to documents is usually given by providing

photocopies of the documents, but alternative

arrangements (such as inspection of original

documents) can be arranged.

Requests for copies of documents under the FOI Act

should be referred to the Freedom of Information

Contact Officer, whose details are given in the

Contact Information at the end of this report.

There were 10 requests under the FOI Act during

2005-06. As requests for information from injured

employees are generally in relation to income

maintenance, Comcare’s policy has been to release

information on a claimant’s claim file under section

59 of the SRC act and not impose charges in these

cases. However, where the request is outside

the claimant’s own file and the work required is

substantial, charges may be applied in line with the

FOI Act.

AP

PEN

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ES

136

Comcare needs to collect personal and often sensitive information about people in order to perform its

functions effectively. Comcare takes very seriously its privacy obligations, as set out in the Privacy Act

1988 and is committed to meeting the highest standards when collecting, storing, using and disclosing

personal information.

Comcare actively participates in forums run by the Office of the Federal Privacy Commissioner and is kept

abreast of impacts on the privacy environment. Comcare did not receive any formal complaints about

breaches of privacy from the Office of the Federal Privacy Commissioner in 2005-06.

APPENDIX 2 : PRIVACY


137

COMCARE AND THE COMMONWEALTH OMBUDSMANThe Commonwealth Ombudsman received 90 approaches/complaints about Comcare during 2005-06.

All matters were finalised with 61 approaches/complaints not investigated and 29 approaches/complaints

investigated.

APPENDIX 3 : EXTERNAL REVIEW

AP

PEN

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ES

138

Section 75A of the OHS(CE) Act provides that the

annual report of Comcare must include

• details of all prosecutions instituted under this

Act and the regulations during the year

• particulars of any directions given by the

Minister to Comcare under subsection 12A (2)

during the year and

• such other matters as are prescribed.

(A) On 10 September 2003 a dangerous

occurrence took place at the Darwin Naval

Base involving a ten-tonne bridge crane. The

moving crane came into contact with stops,

intended to prevent it travelling over an office

located underneath. The impact caused one of

the stops to shear off and fall onto a concrete

shelf adjacent to an office. No-one was injured

as a result of the incident, however Australian

Defence Force and civilian employees would

commonly be working in the area.

Following an investigation by Comcare,

on 8 March 2006 the Director of Public

Prosecutions (DPP) commenced criminal

proceedings against Kone Cranes Pty Ltd and

Spotless P&F Pty Ltd. The charges related

to these companies’ alleged failure to take

all reasonably practicable steps to ensure

the health and safety of workers using the

equipment they supplied and installed.

Kone Cranes Pty Ltd as an installer was

charged with breaching sub-section 20(1)

of the OHS(CE) Act. Spotless P&F Pty Ltd

as a supplier was charged with breaching

paragraphs 19(1)(a) and 19(1)(b) of the

OHS(CE) Act.

(B) On 11 July 2005, the Perth Magistrates

Court sentenced Australian Defence Industries

Limited (ADI) for contravening section 19

of the OHS(CE) Act in relation to the supply

of flexible fuel hoses to HMAS Westralia.

The Court found that ADI failed to take all

reasonably practicable steps to ensure that, at

the time of supply, the hoses were safe for and

without risk to the health of the crew of HMAS

Westralia. ADI was fined $75,000.

(C) On 12 November 2005, Comcare made

application in the Federal Court of Australia

ACT for a Declaration of Contravention against

the Australian Defence Force (ADF).

The Declaration related to a breach of the

OHS(CE) Act which resulted in the heat-related

death of an Army soldier. An investigation by

Comcare found that the ADF breached its duty

of care because it did not take all reasonably

practicable steps to prevent the death. The

matter is set for hearing on 28 August 2006.

Comcare is seeking a civil pecuniary penalty.

There were no Ministerial directions issued under

subsection 12A (2) of the OHS(CE) Act in 2005-06.

APPENDIX 4 : PROCEEDINGS


139

In performing its functions, Comcare applies natural justice and is guided by the principles of equity, good

conscience and the merits of each case.

Each year, Comcare audits the way it delivers its services and has been found to be delivering accurate and

timely decisions.

All Comcare publications and other information about Comcare’s services can be accessed through the

Comcare website, or are available on request. Comcare also mails publications and other information

directly to injured employees, employers and service providers.

Comcare’s service delivery policies set detailed standards for responding to the needs and requirements of

injured employees, employers and service providers.

APPENDIX 5 : SOCIAL JUST ICE AND EQUITY

AP

PEN

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ES

140

Comcare purchased Directors’ and Officers’ liability insurance and professional indemnity insurance

for 2005-2006 from Comcover. The insurance provided coverage for the Chief Executive Officer,

Senior Executive Staff, and Commission members. Directors’ and Officers’ liability insurance covers the

consequences of a wrongful act of these officers. Comcare is required to notify Comcover within 30 days

of the expiry of the cover of any incidents that may give rise to a claim under this cover. There is no excess

payable in the event of a claim under this insurance cover. The cost to Comcare of Directors’ and Officers’

insurance for 2005-06 was $69,440.

Comcare made one claim against the Directors’ and Officers’ liability insurance during 2005-06.

Professional indemnity insurance indemnifies the above officers for damages or judgements and legal costs

awarded against the officers arising from the execution of or breach of their duty. Comcare is required to pay

the first $20,000 of any claim made for professional indemnity. Comcare is also required to notify Comcover

within 30 days of becoming aware of a claim for loss in respect of this insurance. The cost to Comcare for

professional indemnity insurance for 2005-06 was $26,232 (net of GST).

There were no claims against the professional indemnity cover in 2005-06.

APPENDIX 6 : INDEMNIT IES ANDINSURANCE PREMIUMS


141

Total payments by or on behalf of Comcare to advertising and market research organisations in 2005-06

were $134,659.

Market research was conducted by

• Campbell Research & Consulting for the conduct of surveys for the Return to Work Monitor at a cost of

$51,477.

Media advertising expenses were paid to

• HMA Blaze Pty Ltd for recruitment and conferencing advertising at a cost of $83,182.

APPENDIX 7 : ADVERTIS ING ANDMARKET RESEARCH

AP

PEN

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ES

142

No Comcare activities have been identified as having an environmental impact as described under section

516A of the Environmental Protection and Biodiversity Conservation Act 1999.

A d E l ll

p fAPPENDIX 8 : ECOLOGICALLY SUSTAINABLE DEVELOPMENT AND ENVIRONMENTAL PERFORMANCE


143

COMCARE AS PROVIDER

Performance indicator Performance measure Level of performance 2005-06

Providers have established

mechanisms for quality

improvement and assurance

Evidence of quality improvement

and assurance systems in

operation

Comcare’s Quality Systems Team

(QSTeam) continues to work

with the claims service areas

to review, monitor and improve

performance, through audits.

QSTeam coordinates the annual

audit using the Commission’s

Management systems review

and Improvement program tool

(MSRIP).

Refer to page 79 of this report

for further information on internal

audit.

APPENDIX 9 : COMMONWEALTH DISABIL ITY STRATEGY

AP

PEN

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ES

144


Providers have an established

service charter that specifies roles

of the provider and consumer and

service standards which address

accessibility for people with

disabilities

Established service charter that

adequately reflects the needs

of people with disabilities in

operation

Comcare’s service charter specifies

the role of key stakeholders and

standards of service. It includes

information about the Translating

and Interpreting Service.

In 2004-05, Comcare

- obtained feedback on the

best ways to communicate

with injured employees,

employers and the public

- developed a new publication

explaining rights and

entitlements for long-term

claimants

- redeveloped the Claim

for Compensation form to

make it more accessible to

claimants

- monitored service delivery

standards across all aspects

of its business.

Complaints/grievance mechanism,

including access to external

mechanisms, in place to address

issues and concerns raised about

performance

Established complaints/grievance

mechanisms, including access to

external mechanisms, in operation

Comcare has internal complaints

handling arrangements which

manage contact from claimants,

providers and employers and

enquiries from the Ombudsman’s

office, from Members of

Parliament and representations

to the Chief Executive Officer or

Minister.


145

COMCARE AS EMPLOYER


Employment policies, procedures

and practices comply with the

requirements of the Disability

Discrimination Act 1992

Number of employment policies,

procedures and practices that met

the requirements of the Disability

Discrimination Act 1992

Comcare regularly assesses and

monitors its policies, procedures

and practices to ensure

compliance with the requirements

of the Disability Discrimination

Act 1992.

Recruitment information for

potential job applicants is

available in accessible formats on

request

Percentage of recruitment

information requested and

provided in

- accessible electronic formats

- accessible formats other

than electronic.

Average time taken to provide

accessible information in

- electronic formats

- formats other than

electronic.

100% of recruitment information

was available in electronic format

100% of recruitment information

was available in hardcopy format

Applicants with special needs

who apply for employment

opportunities with Comcare are

invited to indicate if they require

any special arrangements to help

them present their claims to the

selection advisory committee.

Agency recruiters and managers

apply the principle of ‘reasonable

adjustment’

Percentage of recruiters and

managers provided with

information on ‘reasonable

adjustment’

All Comcare staff involved

in recruitment processes are

provided with information on

‘reasonable adjustment’.

Comcare’s guidelines for

selection committees highlight

the requirement under the

Commonwealth Disability

Strategy to apply the principle of

‘reasonable adjustment’.

The guidelines also identify

specific resources within

Comcare to assist in assessing

the suitability of applicants with

special needs and making special

arrangements if required.

AP

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ES

146


Training and development

programs consider the needs of

staff with disabilities

Percentage of training and

development programs that

consider the needs of staff with

disabilities

Comcare staff are provided

with training facilities that

accommodate people with

disabilities.

Comcare provides specialised

equipment and/or facilities for

employees, as needed.

Training and development

programs include information on

disability issues as they relate to

the content of the program

Percentage of training and

development programs that

include information on disability

issues as they relate to the

program

Where relevant to the content

of the program, training and

development programs include

information on disability issues

(eg. Comcare’s internal Legislative

Training Program includes

information about the Disability

Discrimination Act 1992).

Complaints/grievance mechanism,

including access to external

mechanisms, in place to address

issues and concerns raised by

staff

Established complaints/grievance

mechanisms, including access to

external mechanisms, in operation

Comcare established a People

Management Committee in 2003

to provide advice on strategic

people management issues.

Comcare has a staff-management

consultative forum, the Comcare

National Consultative Committee.

The Comcare Certified Agreements

2003-2005 and 2005-07

outline procedures for raising and

resolving disagreements in the

workplace. Employees also have

access to the Review of Actions

processes under the Public

Service Act 1999.

A document outlining the

procedures for resolving

workplace issues both internally

as well as externally is available

on Comcare’s Intranet site.


147

COMCARE AS POLICY ADVISOR

Performance Indicator Performance Measure Level of performance 2005-06

New or revised program/policy

proposals assess impact on the

lives of people with disabilities

prior to decision

Percentage of new or revised

policy/program proposals that

document that the impact of the

proposal was considered prior to

the decision making stage

Comcare applies risk assessment

methodology to all programs

People with disabilities are

included in consultations about

new or revised policy/program

proposals

Percentage of consultations about

new or revised policy/ program

proposals that are developed in

consultation with people with

disabilities

When drafting new guides and

policies, Comcare continues

to seek feedback from a range

of stakeholders, including

those representing people with

disabilities

Public announcements of new,

revised or proposed policy/

program initiatives are available in

accessible formats for people with

disabilities in a timely manner

Percentage of new, revised

or proposed policy/program

announcements available in a

range of accessible formats

Time taken in providing

announcements in accessible

formats

All new policy proposals

developed this year were made

available to interested parties,

primarily people with disabilities

who either work, or worked for

the Australian Government, as

well as employers, in hard copy

and electronic formats.

Comcare also issues the

newsletters Working with You

and Comcare News for employers

and former employees in the

formats outlined above and has a

general enquiry line to respond to

any special requests

AP

PEN

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ES

148

COMCARE AS REGULATOR

Performance Indicator Performance Measure Level of performance 2005-06

Publicly available information on

regulations and quasi-regulations

is available in accessible formats

for people with disabilities

Percentage of publicly available

information on regulations and

quasi-regulations requested and

provided in:

- accessible electronic

formats; and

- accessible formats other

than electronic.

Average time taken to provide

accessible materials in

- electronic format

- formats other than electronic

100% of information on

regulations was available in

electronic format

100% of information on

regulations was made available in

hard copy format upon request to

Comcare

Publicly available regulatory

compliance reporting is available

in accessible formats for people

with disabilities

As above As above

149

INDEXES

IND

EXES

150

Office hours 8.30am to 5.00pm AEST

WEBSITEwww.comcare.gov.au

ALL TELEPHONE ENQUIR IES1300 366 979 (local call cost)

EMAIL CLA IMS ENQUIR IES TO :[email protected]

EMAIL OHS ENQUIR IES TO :[email protected]

ALL CORRESPONDENCE TO :GPO Box 9905 Canberra ACT 2601

CORPORATE CENTRE LOCAT IONLevel 1 (Reception), 14 Moore Street

Canberra ACT 2601

Phone: 1300 366 979

Fax: (02) 6248 0322

FO I CONTACT OFF ICER1300 366 979

PR IVACY CONTACT OFF ICER1300 366 979

ANNUAL REPORT CONTACT OFF ICER1300 366 979

CONTACT INFORMATION


151

DIAGRAMS

Diagram 1 Comcare organisational structure

Diagram 2 Relationship between outcome and

contributing outputs

Diagram 3 Corporate governance framework

GRAPHS

Graph 1 Forecast claim frequency and average

cost – Australian Government

Graph 2 Forecast claim frequency and average

cost – ACT Government

Graph 3 Current progress against the reduction in

claims incidence rate (T1)

Graph 4 Current progress against the reduction in

lost time incidence rate (T3)

Graph 5 Current progress against the target in

time taken for rehabilitation intervention

(T4)

TABLE INDEX

TABLES

Table 1 SRC Act scheme profile (excl licensees)

Table 2 What causes injuries

Table 3 When injuries occur

Table 4 Nature of injuries/diseases

Table 5 List of employers which have committed

to targets as at 30 June 2006

Table 6 Total resources for outcome

Table 7 OHS(CE) Act scheme profile

Table 8 Premium claim costs

Table 9 Pre-premium claim costs

Table 10 Total workers’ compensation expenditure

by payment type

Table 11 Performance against Commission

indicators

Table 12 Employer premium performance

Table 13 Return to Work Monitor results 2004-05

Table 14 Staffing overview

Table 15 Salary ranges

Table 16 Staffing by functional area

Table 17 Staffing by location

Table 18 Employment status by gender

Table 19 Staff retention and turnover – Ongoing

staff

Table 20 Staff retention and turnover – Non-

ongoing staff

Table 21 Workplace diversity profile

Table 22 Consultancy services

IND

EXES

152

ACT Australian Capital Territory

ADF Australian Defence Force

Administrative

Appeals Tribunal

(AAT)

The AAT can, on request, review administrative decisions by most Australian

and ACT Government departments and authorities. This includes reviewing

reconsideration decisions made by Comcare. Either an employee or an employer

may request a review of a decision.

ANAO Australian National Audit Office

Appropriation Funding approved by Parliament

Approved

rehabilitation provider

Under the Safety, Rehabilitation and Compensation Act 1988, employers

may only engage rehabilitation providers that have been approved by Comcare.

Rehabilitation providers assist the agency case manager to identify medically

suitable duties as part of the return to work plan (RTWP).

APS Australian Public Service

APS Code of Conduct A guide for the way in which an Australian Public Service employee is required to

behave.

APS Values Are principles, standards and qualities in accordance with which the Australian

Public Service operates.

AWA An Australian Workplace Agreement which sets out the terms and conditions of

employment between an individual employee and his or her employer.

CAC Act Commonwealth Authorities and Companies Act 1997

Case management The management of an injured employee’s return to work plan and coordination

and monitoring of the rehabilitation process.

CEO Chief Executive Officer

Certified Agreement An agreement that sets out the terms and conditions of employment.

Claim Any claim for compensation, eg the initial injury claim, claim for payment of

medical expenses, or claim for incapacity benefits.

Claimant An employee, or a dependant of a deceased employee, who makes a claim for

compensation benefits in accordance with the SRC Act.

Claims management The effective management of an injured person’s claim, including registration of a

claim, decision making, benefit payment and return to work planning. For a claim

lodged with Comcare, a Comcare employee manages the claim.

GLOSSARY


153

Commonwealth

Disability Strategy

Requirements for Commonwealth agencies to identify and remove barriers

preventing people with disabilities from having access to policies, programs and

services.

Corporate governance The process by which agencies are directed and controlled. It is generally

understood to encompass authority, accountability, stewardship, leadership,

direction and control.

CRF Consolidated Revenue Fund

Customer An organisation paying a premium for coverage of its compensation risk.

Customer Information

System (CIS)

An interactive online reporting system for employing agencies.

Date of Injury Date of occurrence (injury), date first sought medical treatment, or first resulted in

incapacity or impairment (disease).

Determination Under the Safety, Rehabilitation and Compensation Act 1988, a decision made

by Comcare to accept or reject a claim.

DEWR Department of Employment and Workplace Relations

Disease Any ailment suffered by an employee, or the aggravation of such an ailment, that

is contributed to, in a material degree, by the employee’s employment.

Employing agency An organisation that receives services provided by Comcare.

FOI Freedom of Information

FOI Act Freedom of Information Act 1982

FTE Full-time equivalent, in the context of staffing levels.

HSR Health and Safety Representative

Impairment The loss, the loss of use, or the damage or malfunction, of any bodily system or

function or part of such system or function. A permanent impairment is one that is

likely to continue indefinitely.

Incapacity A diminished ability to earn.

Incapacity benefit A payment made by Comcare, directly or indirectly, by way of income

maintenance.

Injury Refers to either an injury or disease. An injury can be a physical or mental injury

and includes aggravation of a pre-existing ailment.

KRA Key Result Area

Liability The effect of a determination, creating a legal obligation to pay compensation

under the Safety, Rehabilitation and Compensation Act 1988.

Licensed self-insurers

(Licensees)

A Commonwealth authority or a corporation that is a holder of a licence under Part

V111 of the Safety, Rehabilitation and Compensation Act 1988

Memorandum of

Understanding

(MOU)

Agreement between Comcare and each State and Territory under which OHS

investigation services are provided to ascertain compliance with the Occupational

Health and Safety (Commonwealth Employment) Act, and/or whether there have

been contraventions, and in relation to accidents or dangerous occurrences.

IND

EXES

154

NOHSC National Occupational Health and Safety Commission

ASCC Australian Safety and Compensation Commission

Occupational

Health and Safety

(Commonwealth

Employment) Act

1991 (OHS(CE) Act)

Provides for the health, safety and welfare at work of employees of Commonwealth

departments and authorities.

OHS Occupational health and safety

PBS Portfolio Budget Statements

Permanent

Impairment Guide

A guide to assessment of the degree of permanent impairment, to assist in

determining the amount of lump sum compensation payable for permanent

impairment.

Premium A contribution made to Comcare in respect of the estimated costs of a customer

agency’s workers’ compensation costs for a given financial year. It is based on

fully funded principles and is designed to be responsive to the employing agency’s

claims experience.

Premium claim Claim with a date of injury after the introduction of Comcare’s premium system on

l July 1989.

Premium Pool The sum of all premium funds collected from agencies as assessed by the Actuary

as necessary to fully fund liabilities.

Premium Rate The rate, expressed as a percentage of wage/salary dollar, which, when multiplied

by the estimate of wage/salary, will provide the premium payable by that agency.

Pre-premium claim Claim with a date of injury prior to the introduction of Comcare’s premium system

on l July 1989. These claims and the resultant expenditure may also be called

‘uninsured’.

Provider Person or organisation providing medical, rehabilitation or health services in

relation to a work related injury or disease.

Reconsideration An employee or employer, who is dissatisfied with a decision made by Comcare,

may ask for that decision to be reviewed by an officer not involved in the making

of the decision in question. The result of such a review is called a Reviewable

Decision.

Rehabilitation See occupational rehabilitation.

Return to work plan

(RTWP)

A document detailing a claimant’s rehabilitation program including return to work

objectives, time frames, a breakdown of proposed services and costs.

Reviewable decision The term used to describe a decision reconsidered by Comcare. Only when there

is a Reviewable Decision can there be an application to the Administrative Appeals

Tribunal (see reconsideration and Administrative Appeals Tribunal).

RTW Return to work.


155

Safety, Rehabilitation

and Compensation

Act 1988 (SRC Act)

The legislation which established Comcare and defines how the workers’

compensation function is to be administered for the Commonwealth and ACT

public sectors and a corporation that is a holder of a licence under Part V111 of

the SRC Act.

Safety, Rehabilitation

and Compensation

Commission (the

Commission)

Is responsible for issuing licences for self-insurance and claims management,

and for various regulatory functions under the occupational health and

safety legislation. Until 1992 referred to as the Commission for the Safety,

Rehabilitation and Compensation of Commonwealth Employees. It reports to the

Minister for Employment and Workplace Relations.

SES Senior Executive Service

Workers’

compensation

expenditure

Expenditure under the Safety, Rehabilitation and Compensation Act 1988.

Includes expenditure on incapacity, medical and associated travel, rehabilitation

costs, certain legal costs and other claim related expenses. IND

EXES

156

Aabsence management, 34

access to documents, 135

ACT Government, 14–6, 22, 26, 29, 31, 43, 52,

55–6, 59, 68–9, 71, 74–5, 151-2

Administrative Appeals Tribunal, 44, 54, 58, 71,

152, 155

advertising, 141

asbestos claims, 63, 116, 120–1

asbestos, chrysotile, 49

assets and liabilities, 101, 112, 122, 127

Audit Committee, 78–9, 80

see also audits

audit, internal, 79–80

audits, 57, 80

claims management, 57

OHS, 34

Australia Day medals, 36

Australian Bureau of Statistics, 27, 55, 71

Australian Defence Force, 15, 63, 131, 138, 152

Australian Defence Industries Limited, 138

Australian Defence Organisation, 49

Australian Federal Police, 27, 55, 71

Australian Government, 10, 15, 21, 27, 30–1, 38,

42–3, 47, 48, 55–6, 59, 62–3, 68, 87, 105,

108, 110, 121, 130–1, 147

Australian Maritime Safety Authority, 27, 61, 71

ALPHABETICAL INDEX

Australian Safety and Compensation Council, 10,

11, 26

Australian Taxation Office, 28, 55, 72, 95, 108

awards see Safe Work Australia Awards

Bbody stressing, 23, 26, 29, 31, 49, 55–6, 88

Ccauses of injury, 23

Centrelink, 28, 55, 72

Certified Agreement, 33, 146

Child Support Agency, 28, 55

claims

asbestos related, 14, 63, 122, 124

body stressing, 23, 29, 56

costs, 29, 38, 60

frequency, 21–2

incidence rates, 66

management, 14-5, 29, 36, 43, 45–6, 52, 57,

60, 68, 79–80, 135

new, 54

codes of practice, 47–9, 61

Comcare

corporate governance, 80

priorities, 10, 18, 38

recruitment, 18, 32–3, 35, 36, 145

staff support, 35


157

IND

EXES

Comcare National Rehabilitation Conference 2005,

30–1, 55–6

Comcare News, 60, 147

Comcare’s Rehabilitation

Guidelines for Employers, 56

Commission prevention program, 49

common law injury claims, 15, 38, 42

Commonwealth Compensation

Liaison Committee, 31, 134

Commonwealth Disability Strategy, 88, 143–8

Commonwealth Ombudsman, 28, 137

compensation policies, 26

complaints handling, 57, 81, 144

Compliance and Enforcement Information Portal, 50

consultancy services, 87–8

contacts for further information, 2, 150

corporate governance, 10, 78–80

cost of claims, 21–2, 60, 112

CRS Australia, 28, 55

Customer Information System User Group, 31–2

customer seminars, 30–1, 55, 134

DDepartment of Defence, 28, 42, 55, 63–4, 72,

121–2

Department of Employment and Workplace

Relations, 11, 28, 55, 61, 63, 73, 122

Department of Finance and Administration, 28, 63,

73, 129

Department of Transport and Regional Services, 28,

63, 73

designated work groups, 35

dispute prevention and management, 58

Do Not Disturb notices, 51

documents, access to, 135

Eemployee assistance program, 35

employee relations, 32–3

enforcement actions, 50

Environmental Protection and

Biodiversity Act 1999, 142

Executive Leadership Team, 32, 78–9

expenditures, pre-premium claims, 52, 54

expenditures, premium claims, 52–4

Ffact finding, 57

financial performance, 42

financial statements, 42, 89–132

flexible work arrangements, 33

fraud control, 57, 80

Freedom of Information arrangements, 134–5

Gglossary, 152–5

governance. see corporate governance

guidance materials, 29, 49

Guide to the Assessment of the Degree of

Permanent Impairment, 31, 44, 61

Guidelines (Section 41), 29, 43–4, 56

Hhazardous substances exemptions, 49

Health and Safety representatives, 35, 50

Health and Wellbeing strategy, 34

HMAS Westralia, 138

How Comcare determines claims made

under the Safety, Rehabilitation and

Compensation Act 1988, 57

human resources, 81–87

see also staff

158

Iimaging technology, 57

Improvement notices, 51

incapacity benefits, 43

injuries

body stressing, 23, 26, 29, 31, 49, 55–6

causes, 23

nature, 22–4, 29

prevention, 30–5

psychological, 30, 49, 56

time of occurrence, 23

injury management policies, 43

Interagency Job Placement Program, 26, 30, 56

intranet see Sign-On intranet site

investigations, 35, 49–50, 57

Kkey performance indicators, 66–8

key result areas, 17–18, 26–36

Kone Cranes Pty Ltd, 138

Lleadership and accountability strategy, 26–7, 29,

66

leadership seminars, 55

leadership team, see Exectutive Leadership Team

learning needs, 33–4

legal proceedings, 138

legislation, 14

asbestos claims management, 63–4

legislative reform, 43, 48

letter of transmission, 3

liabilities and assets, 58, 101

liabilities, actuarial assessment of, 41, 60

liability insurance, 140

Licensee Improvement Program, 45

Licensee/Comcare Consultative Forum, 32, 134

licensing of plant, 48

lost time, 27, 58, 66–7, 69

MManagement Systems Review

and Improvement Program, 45, 57, 80, 143

market research, 141

mechanisms of incident, 23

Minister, 11, 14–6, 26, 44, 46–8, 55, 57, 61, 63,

138, 144

NNational OHS Strategy, 10, 26-27, 47, 66

National Public Sector Injury Prevention and

Management Forum, 31–2

National Rehabilitation Conference, 30–1, 55–6

National Return to Work Monitor, 74

National Standards Regulations, 47–8, 50

nature of injuries, 23–4

Ooccupational health and safety, 34


Employment) Act 1991, 14, 47, 130


Employment) Amendment Bill 2005, 14, 34, 48

Office of the Australian Safety

and Compensation Council, 26

organisational structure, 15–6

outcome and outputs, 38–64


159

PPeople Management Committee, 33

performance against targets, 66–9

Performance Development Framework, 33

performance management, 33

performance measures

asbestos claims management, 63

claims management, 55–60

Commonwealth Disability Strategy, 143-8

OHS (CE) Act, 51

Safety, Rehabilitation and Compensation Act, 47

Seacare Authority, 61–2

see also key performance indicators

performance pay, 87

performance snapshots, 20–4

plant licensing. see licensing of plant

pre-premium claims. see claims

premium rates, 70–4

Preventing Psychological Injury: a report for

Comcare on the pilot prevention project, 49

privacy obligations, 136

procurement framework, 80–1

professional indemnity insurance, 138

Prohibition notices, 51

prosecutions, 138

psychological injuries, 21–2

psychological injury strategy, 30

publications, 49, 134, 139

Purpose, 17

Rrecordkeeping, 81

recovery, factors in, 29

reductions in claims, 66

reductions in lost time, 67

regulatory activities, 14–15

rehabilitation interventions, 67

rehabilitation program providers, 44

report of operations, 26–36

representation on external bodies, 45–6, 48

research, 29–30

resources for outcome, 39–41

return to work management, 29, 56

revenues, 42

by output groups, 40–1

reviews

Approved Rehabilitation Provider

performance, 44

Audit Committee Charter, 79

body stressing claims, 29

codes of practice, 47–9

fact finding model, 57

health and safety management, 34

Internal Audit Charter, 79

OHS publications, 49

outcomes and outputs framework, 38

return to work assessment tool, 29

self insurance arrangements, 32

reviews, external, 137

see also disputes management

rewards and recognition, 36

see also Safe Work Australia Awards

IND

EXES

160

risk assessments, 35, 80

risk management, 80

Role, 14–15

SSafe and Sound discussion paper, 26

Safe Work Australia Awards, 27, 62

safety leadership, 26–7

Safety, Rehabilitation and

Compensation Act 1988, 14, 20–1, 43–6

Safety, Rehabilitation and Compensation

Commission, 11, 14–6

indicators and targets, 68

Safety, Rehabilitation and Compensation

Commission Safety Awards see Safe Work

Australia Awards

salaries, 82

SANO Consulting, 29

Seacare Authority, 61–62

Seacare Awards, 62

Seacare Scheme, 61–62

Seafarers Safety, Rehabilitation and Compensation

Authority see Seacare Authority

Section 41 Guidelines see Guidelines (Section 41)

self insurance, 44–5

self-assessment tools, 29

Senior Executives remuneration, 87

Sign-On intranet site, 34

social justice and equity, 139

staff, 18, 32–6, 81–86

insurances, 140

training, 33–4

staff retention, 85

staff surveys, 33

statements of commitment, 27–8

strategic initiatives, 26–36

strategic plan, 17

strategies, 17, 18, 30

studies assistance, 34

Ttarget setting, 27

tendering policies, 87

third party recoveries, 58

time taken for rehabilitation, 66–7

training programs, 31, 33, 44, 50

Vvalues, 17

Vision, 17

Wwhole of agency strategies, 31, 55

work/life balance, 33

workers’ compensation, 52–62

workplace incidents, 35

workplace diversity, 35–6, 86

workplace harassment, 35

Workplace Injury Improvement Targets, 29

Workplace Relations Ministers’ Council, 26