Average Premium Rate for 2022-23 and proposed legislative changes

(2 June 2022)

The Board of ReturnToWorkSA has set the Average Premium Rate (APR) for 2022-23 at 1.80%. This reflects a rise of 5.9% from the 2021-22 rate of 1.70%.

In June 2021, ReturnToWorkSA informed the State Government and stakeholders that a decision by the Full Court of the Supreme Court of South Australia would have a significant adverse impact on the health outcomes and affordability of the State’s work injury insurance scheme (the Summerfield decision).

Without legislative change, a premium increase as high as 25–30 percent would have been realistic given the magnitude of the cost impacts of the changed interpretation of the Return to Work Act 2014.

The issue was recognised in media press releases issued by the (then) Treasurer on 12 and 13 October 2021 about the pending impact of the Court’s decision.

In reaching the APR decision, the Board has relied upon the State Government’s advice that it intends to address the serious legislative anomaly presented by the Summerfield decision via the proposed Return to Work (Permanent Impairment Assessment) Amendment Bill 2022.

The Board has also considered the objects of the Act in supporting injured workers to realise the health benefits of work and reducing the social and economic impacts of work injury to the State and the community, the affordability of premiums, the financial position of ReturnToWorkSA as well as independent actuarial advice.

The capacity of ReturnToWorkSA to keep premiums from rising further as a result of the Summerfield decision is contingent upon the proposed amendment to the legislation being passed by the Parliament of South Australia. If this is not addressed in a timely manner, consequent incurred costs to the Scheme will be incorporated into future pricing decisions including bringing forward the 2023-24 APR decision to provide employers with as much notice as possible.