Sources familiar with internal discussions said angry MPs were motivated to challenge the proposal after hearing that Pearson was on the cusp of announcing a deal with the Coalition to pass the long-anticipated changes through parliament.
Liberal sources confirmed the opposition had been meeting with the government to reach a deal,but the proposal has not gone to shadow cabinet or the party room.
Several MPs toldThe Age that one concession being considered to attract opposition support was a regulated cap on future premium increases.
Striking a deal with the Liberals would give the government the numbers it needs in the upper house,where most crossbench MPs do not support altering mental health benefits,where claims have risen from 2 per cent of all injuries to more than 16 per cent in recent years.
With parliament to resume on Tuesday,union figures spent the weekend ramping up pressure on Labor MPs to challenge Pearson on the deal at Monday’s caucus meeting.
One Labor MP,from Allan’s own Socialist Left faction,speaking toThe Age on the condition of anonymity to discussion negotiations,said ministers were “panicking” ahead of the meeting,with some MPs and union officials preparing to make threats to cabinet members over their future support.
“This will be a litmus test for the cabinet to step up,” the MP toldThe Age.
“Jacinta[Allan] doesn’t have the same power as Daniel[Andrews]. You’ve got a caucus that has never seen this.”
One Right faction MP said there were “serious concerns” from the caucus about the legislation,how it was handled and the fact that no unions appeared to support the bill.
“Unions have been actively contacting MPs about this issue. That has rattled caucus members,” they said.
Another MP,also from the Right,singled out Pearson’s handling of the legislation and said it was creating problems.
“There are more questions than answers from this minister,” the MP said.
“He has told us he’s consulted with unions. They’re telling us they were ‘consul-told’.”
Another MP,from the party’s Left,said there was a risk the bill would be put to a vote of the caucus – which the MP described as “unheard of” – if the concerns of MPs weren’t addressed.
In response to questions about the status of the legislation and its support,an Allan government spokesperson said that the government was continuing to “negotiate to ensure the passage of the bill”.
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“As we’ve always said,if the bill isn’t passed,premiums will have to go up,” the spokesperson said.
In the letter sent to Labor caucus members late last month,Hilakari described the bill as fundamentally flawed and urged Labor to push for it to be withdrawn for further consultation.
The Community and Public Sector Union has been running advertisements on radio urging the public not to support the legislation.
State secretary Karen Batt said this week was a “defining moment for state Labor”.
One MP said the opposition was under significant pressure not to contribute to further insurance costs to businesses. The government has warned they will hike premiums further if their changes are not legislated.
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