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Report Overview
Tasmania’s workers compensation scheme is under review after the amount paid by the state government for workers compensation claims rose from $32.7 million in the 2015 financial year to $143.4 million in the 2024 financial year. ABC News reported on 19 August 2026 that the increase had prompted questions about the scheme’s cost and future operation.
WorkCover Board Tasmania is reviewing the scheme to determine whether it remains fair and financially sustainable. The report is included to identify how workers compensation settings may affect injured workers, particularly those with psychological injuries, without making a finding about any individual claim or liability. Workers who are injured at work may wish to obtain advice about workers compensation options.
Workers Compensation Costs and Coverage
The Tasmanian scheme covers workers who suffer a physical or psychosocial injury, or a disease, in the course of their employment or where their work has substantially contributed to the harm. The scheme covers state employees including frontline workers such as police officers, firefighters and paramedics.
The Tasmanian government has also flagged about 1,700 job cuts across the state service. Against that background, changes to the workers compensation scheme could affect workers, agencies and the cost of supporting people who are injured or become unwell through their employment.
Scheme Review and Consultation
WorkCover Board Tasmania said the review was taking place amid increasing complexity in workers compensation systems nationally. The issues identified included growth in psychological injury claims, longer and more complex claims, and changes in workforce structures.
Consultation on the proposed changes is due to close in September 2026. No final decision on the scheme was reported at the time of publication.
Psychological Injury and PTSD Cover
Treasurer Eric Abetz said psychosocial injury claims had doubled over the past decade and cost about eight times as much as a physical injury claim. The figures and their implications remain part of the policy debate around the review.
Tasmania amended its workers compensation laws in 2019 so that post-traumatic stress disorder suffered by certain first responders could be presumed to be work-related for compensation purposes. Health Minister Bridget Archer did not rule out reducing, narrowing or removing that presumptive cover.
A KPMG report found that 28 per cent of Tasmania’s state service claims in the 2024–2025 financial year were mental-health related, with PTSD claims making up 15 per cent of those claims. Frontline workers, including police, firefighters and paramedics, accounted for up to 23 per cent of mental-health claims, and the proportion appeared to be increasing over the preceding five years.
Political and Union Response
Labor leader Josh Willie asked whether the government could guarantee that no injured Tasmanian worker would receive a lower payment, lose coverage or face a higher barrier to making a claim because of the review.
Mr Abetz said the government should consider the evidence before deciding on changes and wanted the best possible protection for workers while keeping the system sustainable. Unions Tasmania secretary Jessica Munday said prevention, adequate resourcing and support for workers were more important than reducing compensation. She warned that lower support could ultimately lead to more injuries and costs elsewhere.
Costs and Self-Insurance
The Tasmanian government self-insures its workers compensation risk through the Tasmanian Risk Management Fund. ABC News reported that premiums paid into the fund by the Department of Police, Fire and Emergency Management had risen from $2 million in 2018 to $63 million in 2026.
Police Commissioner Donna Adams said the department was preparing for significant increases in future years. The report also noted that more than 100 police officers were off work on mental-health claims earlier in 2026.
Next Steps
The WorkCover Board review and consultation process will determine whether changes are recommended to Tasmania’s workers compensation scheme. The effect of any changes on psychological injury claims, first responders and access to long-term compensation remains to be determined.