Insurance conduct in NSW appears in crisis after the NSW Government's Treasurer "Treasury Secretary" was plunged into crisis and catastrophe due to an insurance scandal that looks like bringing down the NSW Government. See below. How will this affect IAG?

Perrottet's key lieutenant resigns amid icare salary scandal

By Adele Ferguson

August 7, 2020 — 5.00am

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The office of NSW Treasurer Dominic Perrottet is in turmoil after his chief of staff resigned amid revelations the salaries of two of his personal ministerial staff were paid by the scandal-ridden insurance body icare.

The resignation followed a series of questions from The Sydney Morning Herald about the pay details of staff working in the Treasurer's office, including policy adviser Edward Yapp, whose salary was funded by icare.

Under pressure: NSW Treasurer Dominic Perrottet.CREDIT:PETER BRAIG

Mr Perrottet on Thursday night accepted the resignation of his chief of staff Nigel Freitas, who took responsibility for what he said was an administrative error. Mr Freitas had worked with Mr Perrottet for four years. Icare is a workers' insurer funded by employers and is meant to be independent of the political process.

Secondments from government sector agencies such as icare are permitted and occur regularly. However, the Herald has been told the arrangements relating to Mr Yapp and an administrative assistant were discovered on Thursday to have not been documented as required by regulations.

Subsequently, Mr Freitas terminated the secondment of the two staff members, who will continue to be employed by icare. But his role as chief of staff requires Mr Freitas to be responsible for all staff arrangements in the office, especially hiring, firing and remuneration.Add to shortlist

It follows a joint investigation by the Herald, The Age and ABC's Four Corners program into the nation's $60 billion workers' compensation system, which uncovered mismanagement in the NSW government-run icare and "unethical and immoral conduct" in Victoria's scheme, WorkSafe.

Since the investigation broke, Mr Perrottet has defended icare and praised the board and its executives. "The icare team and the executive icare team do a superb job," he said last week.

Earlier this week he said he would bring forward a planned review of icare, headed by a retired Supreme Court judge.

But he has continued to defend the performance of the insurer despite growing calls from the opposition for an overhaul of the board and senior management.Add to shortlist

The controversy engulfing icare has already claimed the scalp of chief executive John Nagle, who revealed to an inquiry this week he was sanctioned by the board and reported to the Independent Commission Against Corruption because of a failure to properly disclose a contract handed out to his wife.

The joint investigation also revealed the State Insurance Regulatory Authority had "grave concerns" about icare amid repeated warnings dating back to mid-2018 over its deteriorating financial position and solvency risks relating to the nominal insurer, which covers more than 3 million workers.