Mental injury claims under Comcare are to face greater scrutiny and prompt a more rehabilitative approach to returning employees to work, according to the Federal Government.

It follows a review of the loss-making scheme that found psychological injury claims increased 30% in the past three years.

“The Government will require Comcare to be more vigilant with assessing mental injury claims by specifying that a mental injury – or aggravation of mental injury – is only considered to arise from employment if any perception on which the injury is claimed has a reasonable basis,” Employment Minister Bill Shorten said.

In his review of the Federal Government workers’ compensation scheme, Peter Hanks QC says it is “an unfair burden on employers to make them liable… for a psychological injury that is caused by an employee’s fantasising rather than by any aspect of employment”.

Work-related injury and illness costs about $60.6 billion a year, about 4.8% of GDP.

The Government is committed to creating a “best-practice” scheme that gets injured and ill employees back to work sooner, Mr Shorten says.

Legislation underpinning the scheme – the Safety, Rehabilitation and Compensation Act – is to be amended and faster claims resolution is in the pipeline.

Former Defence Department head Allan Hawke, who also contributed to the review, has called for legislative changes to include a separate fund within Comcare for the ACT.

Currently “there is limited visibility of how premiums from different government sources are spent, meaning premiums from one government could be subsidising the other, contrary to the premium guidelines”, he says.

“Having separate funds would enable the true performance of each fund to be properly assessed.”