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Callum Godde

Vic offsets work cover costs with $300m

An extra $300m will be injected into Victoria's workers compensation scheme to offset rising costs. (AAP)

An extra $300 million will be injected into Victoria's workers compensation scheme to offset rising costs.

Victoria's WorkCover premium rate, charged to businesses to pay for the workers compensation scheme, will remain at 1.272 per cent this financial year, the state government confirmed on Friday.

Claims are becoming more complex for WorkSafe to assess after the scheme was expanded to mental injuries.

That extra pressure, along with volatility in international markets amid the COVID-19 pandemic, has worsened the regulator's projections compared to last financial year.

To offset the forecast financial hit without increasing premiums for businesses, the Victorian government will tip another $300 million into the scheme.

"We know it's been a tough few years for businesses - that's why we're keeping WorkCover premiums low so businesses can continue to recover from the impacts of the pandemic," Workplace Safety Minister Ingrid Stitt said.

"Victorian workers need to know that when they ask for help, the WorkCover scheme is there to support them and their families - this investment ensures that help is there as we get on with making our workplaces safer."

It follows the Andrews government providing $550 million and $350 million worth of WorkCover premium relief over the past two COVID-disrupted years.

In March, an independent review into Victoria's workers compensation scheme found mental injuries make up 17 per cent of total claims and are increasing.

"Mental injury claims on average receive compensation payments nearly two and a half times higher than claims generally, and the duration of time off work by a worker with a mental injury claim is nearly three times greater," it said.

The review, led by newly appointed County Court judge Peter Rozen, made 22 recommendations to improve the management of complex WorkCover claims.

Nineteen were accepted by the Andrews government in full or principle.

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