Victoria’s WorkCover Authority (VWA) has announced its fourth successive insurance profit for the six months ending December 31, recording a $338 million profit from insurance operations – $17 million up on last year.

The strong insurance result also showed a writedown in projected liabilities of $86 million. Apart from reflecting a substantial reduction in projected long-term weekly benefit costs, Chairman James MacKenzie said the release was also derived from continued improvement in managing old common law costs.

“The reduction in common law and turnaround in weekly benefit costs demonstrates the VWA’s capacity to manage the scheme on several fronts through our more focused approach to claims management,” he said.

But investments are casting dark clouds on Mr MacKenzie’s bright horizon. Increasing volatility in global investment markets meant a net loss of $253 million for the six months to December 31, compared to a net loss of $247 million for the half ended June 30.

Mr MacKenzie said the result is a notable turnaround from the 1990s, when strong investment returns, together with legislative changes restricting injured workers’ entitlements, masked progressive deterioration in the scheme’s core operations.