Today in Question Time, Abigail pressed the NSW Treasurer on whether the sharp increase in legal funding denials for injured workers, including for death benefits claims, was an intended result of last year's workers compensation cuts.

Abigail said:

My question without notice is directed to the Treasurer. From 1 July 2026 the new Independent Legal Assistance and Review Service [ILARS] funding guidelines came into force, supported by the newly updated workers compensation regulations. Those guidelines and regulations provide guidance on the application of the new so-called merits test for legal funding for injured workers that was brought in with last year's workers compensation bill. In that short time, there has already been a precipitous increase in the number of claims for legal assistance being declined by the Independent Review Office, including numerous instances of funding being denied to claimants for death benefits flowing from a workplace injury. Was this the Treasurer's intended outcome, and does the Treasurer believe this was the intended outcome of those members of this House and of the other place who ultimately supported the cruel workers compensation cuts passed earlier this term?

The Hon. DANIEL MOOKHEY (NSW Treasurer): I thank the member for her question. Whilst she has asked me this question in my capacity as Treasurer, I point out that the ILARS issue actually falls within the jurisdiction of the other two Ministers with whom I share the responsibilities of the Act. Nevertheless, I am happy to answer the member's question. The short answer to the last part of the question is no. The longer answer, as I am sure the member is aware, is that the creeping cost of ILARS has put tremendous pressure on the scheme. It has been one of the fastest categories of growth. Whilst I accept that Ms Abigail Boyd did not like the outcome of the debates that took place in this House, it was an area that gathered quite a bit of consensus across the political divide, with the exception, of course, of the people who participate in ILARS as system providers.

When applying for public compensation support, the only thing that this Parliament required from ILARS was a reasonable prospect of success. Incidentally, this principle is applied in Legal Aid and many other forms of legal assistance. Prior to the reforms that we brought in, the ILARS scheme was anomalous in that it was the only form of funded litigation not subject to that test. That is why the Government made the change. Insofar as Ms Abigail Boyd is impugning motive, which I understand she has done repeatedly throughout the debates, I reject that.

To which Abigail responded:

I thank the Treasurer for his answer. As he well knows, the $50 million of ILARS costs was not really the issue with the scheme that has now, even prior to most of those cuts coming through, resulted in not just $2 million more profit than we thought it would but also $1 billion worth of pure profit now being taken out of icare and put into the Government's coffers. Prior to 2012, this was a scheme in which costs followed the success of a claim. That was taken away in 2012. What was further taken away last year was the ability for the vast majority of injured workers and their dependants, who have a success rate of about 75 per cent, to get legal assistance at all.

Read the transcript in Hansard here.

4 August 2026