Min­is­ter blames Lib­er­als for ICBC mess

The Prince George Citizen - - News -

Ma­jor re­forms are on the way to ex­tin­guish a “fi­nan­cial dump­ster fire” at Bri­tish Columbia’s pub­lic auto in­surer, which projects a $1.3-bil­lion net loss this fis­cal year, the prov­ince’s at­tor­ney gen­eral said Mon­day.

David Eby blamed the cri­sis at the In­sur­ance Cor­po­ra­tion of Bri­tish Columbia on years of “reck­less de­ci­sions” by the pre­vi­ous Lib­eral govern­ment, in­clud­ing tak­ing more than $1 bil­lion from the in­surer and trans­fer­ring it to govern­ment cof­fers.

He also said the govern­ment ig­nored warn­ings and rec­om­men­da­tions made in a 2014 re­port by in­de­pen­dent con­sul­tants Ernst & Young, and ap­pears to have scrubbed the rec­om­men­da­tions from a ver­sion of the re­port pre­sented to the pub­lic.

“They knew the dump­ster was on fire, but they pushed it be­hind the build­ing in­stead of try­ing to put the fire out,” he said at a news con­fer­ence, adding that be­fore last spring’s elec­tion, the Lib­er­als pro­jected ICBC’s losses to be $11 mil­lion.

“Bri­tish Columbians were not told the truth about the state of ICBC. They were told the prob­lem was not se­ri­ous – a loss of about 100 times less than was ac­tu­ally the case. Now Bri­tish Columbians are fac­ing the full con­se­quences of the pre­vi­ous govern­ment’s de­ci­sion to bury the truth.”

The in­sur­ance cor­po­ra­tion has al­ready posted a net loss of $935 mil­lion for the first nine months of the 2017-18 fis­cal year. It said the “siz­able and sig­nif­i­cant loss” is due to a rapid in­crease in the num­ber of col­li­sions in the prov­ince, as well as the ris­ing costs of those claims.

Eby, who is also min­is­ter re­spon­si­ble for the in­sur­ance cor­po­ra­tion, said it’s yet to be de­ter­mined how rates for driv­ers will be af­fected, but he in­tends to keep them af­ford­able, with high-risk driv­ers pay­ing more while low-risk driv­ers pay less.

He said the govern­ment will an­nounce mea­sures to ad­dress the cri­sis in the com­ing weeks. He said it was se­ri­ously look­ing at a num­ber of dif­fer­ent ini­tia­tives, in­clud­ing caps on fi­nan­cial awards for mi­nor in­juries, changes to de­ductibles and other re­forms aimed at low­er­ing le­gal and auto body costs.

The govern­ment is not con­sid­er­ing no-fault in­sur­ance, he said, as it wants to pro­tect the right to sue and re­cover dam­ages from the court sys­tem.

Eby did not pro­vide a copy of the draft Ernst & Young re­port he ac­cused the Lib­er­als of redact­ing. But for­mer fi­nance min­is­ter Mike de Jong told The Prov­ince news­pa­per that the govern­ment re­moved at least one of the rec­om­men­da­tions, around mi­nor-in­jury caps, be­cause it wasn’t pre­pared to con­sider it.

Lib­eral leg­is­la­tor John Yap said the threat posed by ris­ing claims and pay­outs is well-known and the pre­vi­ous govern­ment took steps to deal with the is­sue. As well, a third-party re­view of ICBC was or­dered by the B.C. Lib­er­als and de­liv­ered on July 10, so it was wait­ing on the desk of the new min­is­ter, he said.

“In­stead of tak­ing the im­me­di­ate ac­tions the re­port called for, David Eby has done noth­ing for seven months ex­cept or­der an­other re­view,” said Yap.

“It is clear the B.C. NDP made prom­ises they can’t de­liver on and so are look­ing to lay blame in­stead of ac­cept­ing re­spon­si­bil­ity for that. David Eby has a blue­print for mov­ing for­ward at ICBC but keeps de­lay­ing any ac­tion and is al­low­ing the prob­lem to grow even worse un­der his watch.”

Eby said the sit­u­a­tion at ICBC would have “im­pli­ca­tions” for the pro­vin­cial bud­get, but he re­ferred ques­tions to Fi­nance Min­is­ter Ca­role James, who did not im­me­di­ately re­spond to a re­quest for com­ment.

Asked whether he would rule out pri­va­tiz­ing the pub­lic in­sur­ance cor­po­ra­tion, he said ICBC pro­vides many im­por­tant services to the pub­lic, in­clud­ing driver li­cens­ing, and On­tario’s pri­va­tized regime has not de­liv­ered lower costs to ratepay­ers.

“It’s not sim­ply a mat­ter of who owns the in­surer. It’s a mat­ter of man­age­ment. It’s our in­ten­tion to get man­age­ment un­der con­trol at ICBC.”


At­tor­ney Gen­eral David Eby ar­rives to speak to me­dia fol­low­ing the pub­lic en­gage­ment launch for next year’s pro­vin­cial ref­er­en­dum on elec­toral re­form dur­ing a press con­fer­ence at the Leg­is­la­ture in Vic­to­ria on Nov. 23, 2017.

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