The NSW Government Said It Was About Protecting Small Business. The Truth Is Workers' Compensation Is Costing Lives.
Nov 8, 2025
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Australia’s hidden workers’ compensation crisis is not a policy failure — it’s a moral one.
For more than a century, Australians have believed that if you were injured at work, the system would protect you. That belief wasn’t naïve — it was part of the deal. You gave your labour. The nation guaranteed your safety net.
But that promise has been broken — not by accident, not by inefficiency, but by design.
And while governments keep the public calm with talk of “keeping premiums low for small business,” a very different truth has been unfolding:
The workers’ compensation system is no longer about care. It is about containment: financial, psychological, and in too many cases, fatal.
A Promise Turned Into a Calculation
The turning point came in the 1980s, inside the NSW Government Insurance Office, where an early algorith based computer program called Colossus was developed. It was sold as “fairness through technology.” It was designed to contain 'claim leakage'.
Ironically, one of the most valuable public records of how Colossus was first developed can be found inside the NSW Parliament itself — thanks to the meticulous work of Jane R. Nauta, who served as Librarian at the Government Insurance Office from 1973 to 1986.
During her tenure, Ms Nauta compiled detailed notes chronicling the evolution of GIO’s operations, including the creation of Colossus. As noted in the publication’s introduction:
"Jane R. Nauta was Librarian at the Government Insurance Office from 1973 to 1986.
During that time she compiled these detailed notes which are a valuable record of the
growth and development of a major NewSouthWales institution. It is the Parliamentary
Library's privilege to bring about the publication of these useful historical insights. We are all indebted to Ms Nauta for the diligence of her research."
Her work, preserved for the public record, now provides vital historical insight into how algorithmic decision-making first entered the state’s insurance system — an enduring service to the citizens of New South Wales.
But Colossus didn’t improve the system — it rewired it.
It replaced the question “What does this person need to heal?” with “What is the cheapest amount we can pay and still legally get away with?”
From that point on, injured people were no longer citizens — they were cost codes.
And the logic spread. From NSW, to Australia, to the world.
You’ve Seen This Pattern Before
We just didn’t call it Robodebt yet. We didn’t yet have the horror of the UK Post Office scandal. But the architecture was already the same:
Turn human judgment into software.
Call it “modernisation” or “efficiency.”
Hide the harm until the bodies — figuratively or literally — are too many to ignore.
Robodebt. The UK Post Office scandal. Workers’ compensation is next, and the stakes are just as lethal.
The only reason it hasn’t exploded yet is because the people harmed are scattered, exhausted, traumatised — and often silenced by NDAs, bankruptcy, or death.
The Lie: “We’re Protecting Small Business”
Governments continue to justify the system by saying premiums must stay low to “protect small business.”
But here’s the truth:
Small business isn’t being protected.
Injured workers are being sacrificed.
Insurers are being shielded.
The state is offloading responsibility onto families, Centrelink and charity.
The social cost is simply being buried.
What looks like “sustainable policy” on paper is actually outsourced human harm.
When care is too expensive, the system doesn’t fix itself, it fixes its data. It edits the story, not the injury.
Suicides Are Not “Tragic Exceptions.”
They Are Predictable Outcomes of System Design.
People have died by suicide inside this system. Not because they “couldn’t cope,” but because the system was built to erode a person until they disappear from the expense line.
And even then the regulator admits the suicide numbers are under-reported.
But here is the detail that should end the debate forever:
A former CEO of the regulator told a previous NSW parliamentary inquiry that they had already prepared pre-written condolence letters for the then minister
That wasn't done to prevent deaths, but to manage the political fallout when they happened.
That is not a safety net. That is a crisis PR plan masquerading as governance.
“Reform” Has Not Failed — It Has Been Weaponised
The public is told the system is “constantly being improved.” That costs are 'unsustainable'. Operating 7 different IT systems in the first place was unsustainable and then they failed at implementing a unified IT platform across the scheme.
Not small business. Not injured workers. One agency - then known as Workcover broken into 3 agencies in 2015 with no unified IT platform. No oversight of anything really.
Instead - here's what arrives for the injured as 'reforms'.
Raise thresholds
Increase surveillance
Fast-track claim rejections
Limit psychological injury access
Shift blame onto the injured
Shield insurers and governments from liability
Over and over and over again.
The only people “reformed” in this system are the injured — into silence, poverty, or death.
This Is No Longer About “Workers’ Comp”
This Is About What Kind of Country We Are
If your son is crushed on a worksite. If your daughter is bullied into a breakdown in a hospital. If your partner’s spine collapses in a delivery van. If you develop PTSD after a violent customer attack. If you are sexually harassed at work.
You don’t enter a system of care. You enter a system of doubt, delay, surveillance, and denial — one built on the belief that human beings are financial liabilities to be minimised.
You are not a person in need. You are a cost to be reduced.
That is the logic now governing thousands of lives every day in Australia.
The Question Is No Longer “Does It Need Reform?”
The question is:
How long will we let a system stay in place because the spin sounds reasonable?
Robodebt didn’t fall because the government grew a conscience. It fell because the public finally refused to accept the lie.
The UK Post Office scandal didn’t end because executives apologised. It ended because ordinary people made silence impossible.
We Are Now at the Same Point of Choice
A system that breaks the injured is not a system worth defending. A government that hides suicides behind “under-reported data” has abdicated responsibility. A nation that allows this harm is not compassionate — it is complicit.
Workers’ compensation is not a niche issue. It is a national integrity test.
The injured can’t win this alone. They are not meant to — that’s the design.
The only force more powerful than a broken system is a public that finally sees it for what it is.
This is not the business of care. It is the business of control. And it ends when we decide it does.
Note: There are 11 different workers' compensation systems around Australia, operated by various state Governments. All have serious problems.
