Return of the ‘ culture of entitlement’
Current Liberals have gradually undone much of the work of their predecessors
Their combined improvement to the corporate bottom line demonstrated better than any ideological argument that public auto insurance could be run on a cost- effective basis.
VICTORIA As a measure of how far the B. C. Liberals have drifted from the cost- containing days of their first term, one need look no further than the recent review of the Insurance Corp. of B. C.
The number of managers boosted by one- third at the same time as the ranks of the managed were being reduced. Managerial compensation boosted by 50 per cent while the troops were forced to make do with 10 per cent.
Signing bonuses. Some 54 managers being paid more than $ 200,000 a year, up from 14. Other allowances and perks.
“ICBC executives would make drunken sailors blush,” as Jordan Bateman of the Canadian Taxpayers Federation headlined his news release on the internal review from the ministry of finance.
Contrast those findings to what happened a decade ago, after the Liberals recruited Nick Geer, a senior executive from the Jim Pattison empire, to oversee the government- owned insurance corporation.
Geer tackled what he called “a culture of entitlement” at every level of the government- owned auto insurance giant, cutting operating costs from the executive suite to the front office.
“Our staff is down by 1,400 people from a high of 6,500,” he boasted during a presentation to the legislature committee on Crown corporations in the spring of 2003. “We’ve reduced 270,000 square feet of space. We’ve closed claim centres.
“I got there as the new president and found a fleet of vehicles which would choke a horse. There were some 900 vehicles owned in ICBC. There are now 87. We’ve taken away a number of entitlement provisions, such as timeoff days, extended vacations, banked vacations, fairly rich post- retirement benefits ...”
The drive continued even after the Liberals and Geer parted ways over what they regarded as his insufficient enthusiasm for shifting the insurance business and other ICBC assets to the private sector.
His successor, Paul Taylor, in addressing the same legislature committee in late 2004, reported that operating costs had been reduced by 26 per cent, turning a $ 250- million loss to a net income of $ 400 million. Taylor would become as much of a defender of ICBC’s turf as Geer. Their combined improvement to the corporate bottom line demonstrated better than any ideological argument that public auto insurance could be run on a cost- effective basis. But fiscal rust never sleeps. “A culture of cost containment and fiscal discipline has been lacking in recent years,” as the finance ministry put it in last week’s scathing audit of ICBC. “Increases in staffing and compensation levels continued even after the economic downturn in 2008 when government implemented stricter cost controls.”
In releasing the report along with the news that Jon Schubert, the successor to Geer and Taylor, would be leaving the company because of it, Finance Minister Kevin Falcon sought credit for a government that “is constantly going to be turning over rocks,” looking for ways to save money.
One readily recalls how this time last year, a similar review found much the same state of affairs at another governmentowned corporation, BC Hydro.
The Liberals, during their cost- cutting phase, had reined in operating costs at Hydro and shifted a couple of thousand jobs to private operators. The review disclosed how the in- house workforce and the tab for compensation were nevertheless bigger than ever, never mind all those jobs shed through privatization.
“A gold standard corporate culture,” the review called it.
So, to recap, the Liberals dismantled a “culture of entitlement” in their first term only to allow the emergence of one that was no less wasteful a decade later.
It happened because of a collective failure, from the cabinet table and the government caucus, to the legislature ( the committee on Crowns hasn’t met in six years), the governmentappointed boards of the Crowns and the regulatory authorities at the B. C. Utilities Commission.
But the deteriorating mindset was well explained this week in Towards a New Government in B. C., an ebook published by Martyn Brown, the longtime chief of staff to departed premier Gordon Campbell.
“This I know from experience,” wrote Brown. “When you are comfortably ensconced at the peak of power, it is too easy to forget why you are there, and it is sometimes hard to see the point, especially when corporate vision is waning.
“In the premier’s office, all around you is blue sky, white noise, and the echoes of endless, unanswered need. The longer you are there, the colder you tend to get, and the more remote things look. You struggle for perspective. You become jaded and complacent.”
Jaded and complacent. Brown might have been drafting talking points for the official Opposition on the government performance on ICBC and BC Hydro.
In their defence, the Liberals argue that new Premier Christy Clark ought to get credit for turning over these rocks, making the findings public, and rectifying the excesses.
More likely voters will wonder that a party pledged to mind every dollar of public spending let it come to this in the first place.