Industries need further incentives to improve safety

Michael Tooma, Alena Titterton and Laura Maytom write:

On 12 March 2009, the Australian Safety and Compensation Council released the latest Compendium of Workers Compensation Statistics Report analysing accepted workers’ compensation claims, breaking down compensated work-related injury and disease amongst Australian employees between 2000-01 and 2006-07.

A complete update on the statistical results contained in the Report can be viewed here.

While many of the statistics show falling incidence rates, the rate of improvement is too slow to meet national targets. A picture is emerging, in both the release of the Report and the statistics reported in the most recent Comparative Performance Monitoring Report, 10th Edition that current OHS strategies are not achieving the targeted outcomes for improvements in OHS performance which have been set by the National OHS Strategy 2002-2012, which begs the question – is the existing regulatory regime working? Australia remains ranked as 6th for OHS performance behind Switzerland, Sweden, the United Kingdom, Norway and Denmark.

The total cost of work-related injuries and illnesses has also increased by more than 20 billion dollars between 2000-01 and 2005-06. In a report entitled The Cost of Work-related Injury and Illness for Australian Employers, Workers and the Community 2005-06 released by the ASCC today, the total economic cost of work-related injuries and illnesses for the 2005-06 financial year is estimated to be 57.5 billion dollars, representing 5.9 per cent of GDP for that year. This is a dramatic increase from 2000-01, when the total economic cost of work related injuries and illnesses was 34 billion dollars representing only 5% of GDP. This is an unacceptable cost to the economy.

Increasing costs and decreasing rates of improvement demonstrate the need for additional mechanisms to be used in the approach to current regulatory efforts to improve safety performance. As the economic climate continues to dominate the focus of business operations, industry needs more effective incentives to encourage safety expenditure to ensure that the reduction of workplace injuries does not continue at such a slow pace or plateau in Australian workplaces. Governments in this economic climate should investigate the introduction of tax concessions for safety expenditure in Australian workplaces to drive further improvements in Australia’s safety performance.

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