Whitlam’s dismissal diverted workers compensation reform

In October 2014, one of Australia’s Prime Ministers, Gough Whitlam, died at the age of 98.  Whitlam introduced major social reforms, many which still exist today (just).  One reform he valued but was not able to achieve was a national accident compensation scheme. It is worth noting when reading of the current economic and moral arguments over workplace responsibility and over-regulation that Whitlam’s national accident compensation scheme included workers compensation.

In 1974, during Whitlam’s time as the Prime Minister of Australia, the New Zealand government established a no-fault accident compensation scheme following the 1967 Royal Commission of Inquiry into Compensation for Personal Injury in New Zealand chaired by Owen Woodhouse.  Woodhouse was invited to assess the likelihood of a similar scheme being introduced in Australia.  He completed his inquiry (not available online) for such a scheme and legislation was drafted. The bill was in the Australian Parliament when the Whitlam government was dismissed by Governor-General John Kerr.  As a result of the political machinations of the Liberal Party of Australia, Australia missed the opportunity to have a national accident compensation scheme.

The then Minister for Social Security, Bill Hayden, said in an election campaign speech on 18 May 1974 that he expected the Woodhouse report to suggest:

“…a national rehabilitation and compensation scheme for Australia so that all who suffer disabling injuries, whether at home or at work, are provided with adequate income cover.”

According to a background note on national workplace safety and workers’ compensation systems by Steve O’Neill, the five basic principles for an approach to accident prevention applied in the Woodhouse report were:

  • “community responsibility: the community should bear the costs of the inevitable consequences of social and productive activities, not just random victims of those activities because the community at large benefits from them
  • comprehensive entitlement—24 hours a day and seven days a week
  • complete rehabilitation
  • adequate compensation, and
  • administrative efficiency.” (page 2)

The first bullet point may seem odd in the workers’ compensation context but according to Woodhouse’s report (not available online but is in some Australian libraries)

“the proposed scheme must be accepted as an aspect of social welfare: and it must be organised as a responsibility and function of the State.” (page 3)

Over the decades since, there seems to have been a concerted effort to keep workers’ compensation separate, at least in the public consciousness, from social security services but these two welfare areas have always overlapped in reality just not in a formal legal or legislative sense.

So, the dismissal of the Whitlam Government had a direct effect on the development of workers’ compensation in Australia, it put the country on a path away from a national accident compensation scheme.  How different the situation of injured workers would have been if the reform had occurred? How different would have been the political debate on the James Hardie asbestos compensation?  How different would business’ attitude to workplace injuries?

It may be worth ending on a quote from Owen Woodhouse’s report, when he discusses the purpose of the report:

“Social problems in the past have been handled in a piecemeal fashion. But half-measures and compromise are quite incapable of meeting the modern needs and reasonable aspirations of disadvantaged citizens. The obligations of the community should be thought through from first principles. The Report attempts to provide that analysis. It proposes a new deal for every Australian whose life has been disrupted or damaged by injury or disease.”

Kevin Jones

9 thoughts on “Whitlam’s dismissal diverted workers compensation reform”

  1. Thanks Kevin,
    There was a typo in the first link you supplied above – it should be http://www.aph.gov.au. (aph.org is a policy and history website).

    And despite spending a while searching the .gov site I can only find ‘question fragments’ and speeches relating to the bill in Hansard.

    I have not been able to get a copy of the ‘National Compensation Scheme 1974’ bill up in any searches of any of the databases. And I’ve used both narrow and broad filter criteria in date ranges, and text/title searches.

    I’m wondering if that bill precedes current computer archives????

    1. It may precede digitisation as Woodhouse’s original report but the library of the local OHS regulator (if they have one) shoud be able to provide access. If not the State Parliamentary library should, if you give them a call. I have always found the librarians at these places extremely helpful.

  2. Les, I have had the chance to think a little about your questions. Given that New Zealand established the Accident Compensation Commission (ACC) in 1974 I looked at its website (http://www.acc.co.nz/about-acc/overview-of-acc/how-were-funded/index.htm). It said this about its funding:

    “The money we need to provide our services comes from levies on people’s earnings, businesses’ payrolls, petrol and fees from vehicle licensing, as well as Government funding. When working out how much money to collect through levies, we balance the likely cost of claims against the need to keep levies fair and stable. We distribute the money collected into one of five ACC Accounts, each Account covering a specific group of injuries.”

    The link above may also help with your question regarding employer responsibilities as it seems employers contribute to some extent through levies (http://www.acc.co.nz/about-acc/levies/index.htm).

    On the question about Federal Vs States,this is a perennial discussion that was resolved(?) during the harmonisation process in favour of States. I would favour a federally administered national accident compensation scheme but one would have the large (influential) insurance companies screaming about loss of revenue and probably challenging the scheme through the Courts. The introduction of the NDIS may be an illustration of obstacles.

  3. Lets get it up again . The work place is not a perfect world and the economy benefits everyday by less than perfect practices . But when an individual is hurt by one of these practices we punish them. It’s guaranteed that the same work practice that hurt that worker was done by thousands of others on the same day , Just a bit luckier.!!
    Lets stop the hypocrisy .

  4. Hi Kevin,

    Whilst the questions you pose are moot, about how different things would have been, they do raise my interest in how such a system might be developed, implemented and administered – especially in light of the radically different governmental structures between NZ and Aus.

    Questions that spring to my mind, specifically in relation to work related injury and illness, include: how would it be funded and administered?

    If the funding were to come from ‘government coffers’, without some contribution by employers, there would be a disconnect between responsibility and accountability of those employers failing in their WHS duties and for the injured worker receiving benefits.

    Would it be administered by the federal government or by the states? Would it remove the need for Workers Compensation laws and Insurance systems?

    Also, I see the recent development of the NDIS going some way to providing for persons who are disabled, irrespective of the root cause of their disability. But that is not about making compensation for loss of earnings, it’s more about providing for quality of life and ongoing care and support for those unable to care for, or support, themselves.

    I wonder what it would look like?
    Do you know if the draft legislation is available anywhere?

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