The Federal Government’s workers’ compensation scheme Comcare is fully funded for the first time since 2010, three years ahead of schedule.

Comcare is estimated to have recorded an operating surplus of $540 million last financial year, up from $253 million in 2015/16.

Much of the improvement stems from a $450 million reduction in claims liabilities.

Crucially, Comcare achieved a funding ratio of 107%, and it intends to maintain this at 105-110%. It had a funding ratio of 84% in 2015/16.

“Achieving full funding is an outstanding result and provides greater certainty for the premium paying scheme,” CEO Jennifer Taylor said. “We intend to maintain a funding ratio of 105-110% to protect the scheme against any future shocks.”

Comcare’s funding ratio of assets to liabilities fell to a low of 64% in 2013 due to significant increases in time off work for claimants on incapacity payments.

The scheme had aimed for a funding ratio of at least 100% – to be fully funded – by July 1 2020, according to its latest annual report.

The overall premium rate for the current financial year is 1.23% of wages, down 28% on last year as claims frequency and return-to-work outcomes improve.

“Comcare will continue to focus on early intervention efforts to help improve recovery and return-to-work outcomes in the first six months of a claim,” Ms Taylor said.

“We are also working to reduce the cost of longer-term claims by finding opportunities for rehabilitation and better liability management.”