WorkCoverSA, a multi-billion dollar State Government corporation, is a basket case and beyond redemption, a senior Minister has admitted.
Attorney-General and Industrial Relations Minister John Rau confirmed today that WorkCover would be decommissioned.
"It's buggered," Rau told InDaily.
"We'll decommission the scheme and start again.
"It's been amended, patched over and fiddled with for years and in the process has become so disliked, the only thing to do is to rub it out and start again."
WorkCover administers workers' compensation for more than 430,000 employees of almost 50,000 businesses.
Last year it managed 16,774 claims, collected $667 million in employer levies and paid out more than $809 million in cliams.
The gap between income and expenditure is mostly covered by a massive $2.25 billion investment fund; its holdings in shares, property and cash delivered investment returns of $253 million.
Even with the investment income, WorkCover's projected gap between estimated claims and estimated income leaves it with an unfunded liability of $1.366 billion.
Rau, who took over responsibility for WorkCover early this year, has been doing an internal review of the organisation, and doesn't like what he sees.
He expects to name seven new members of its board by the end of this month, along with a new chairman.
Current chairman, Philip Bentley, retires on 31 October.
"The scheme has been poorly administered," Rau said.
"People have been left sitting on the scheme; there's been a glaring failure to address early intervention and early action to return to work."
Rau, however, had little detail of WorkCover's replacement.
"I hope to have a basic set of policy principles in place by the end of December; certainly in time for the March State election."
For the 300 staff at WorkCover's head office in King William Street, the future is clouded after Rau's stinging attack on the organisation.
"The culture at WorkCover, the structure within the corporation; it's just not working."
There have been major changes in recent months with the new appointments at senior executive level since its latest chief executive officer Greg McCarthy took the job when his predecessor Rob Thompson left unexpectedly last year.
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