While Eby’s plan alleges it will ‘put ICBC on a path so that it can once again work in the interests of all drivers in BC’ ... the risk of ‘political interference’ will remain
Yesterday David Eby, Attorney General for
John Horgan’s NDP government, released a statement regarding the announcement ICBC. He stated:
Trust and Confidence in short supply with BC drivers |
“Today, British Columbian drivers are again
faced with the reality of the financial crisis at ICBC left by the previous
government. This situation was so dire that, had our government not moved to
stop the bleeding, the announcement today would have been almost a 40%
increase.
“What’s worse is that these repeated
increases could have been prevented. The previous government was presented with
clear solutions to ICBC’s financial crisis and warned that if it did not act,
drivers would suffer the consequences. They not only ignored the warning, they
hid the solutions from the public.
However, an August 2017 report by Mark Milke
(PhD), for the Canadian Taxpayers Federation, stated that issues go much
further back:
Political interference in the marketplace was not limited “only” to a ban on competition with the creation of ICBC. Early on, in the setting of rates, the government acted against the advice of ICBC actuaries. As one history of the decision-making process recounts, “the NDP caucus decided upon a structure lower than suggested by its professional advisers.”
Political interference in the marketplace was not limited “only” to a ban on competition with the creation of ICBC. Early on, in the setting of rates, the government acted against the advice of ICBC actuaries. As one history of the decision-making process recounts, “the NDP caucus decided upon a structure lower than suggested by its professional advisers.”
Still, Attorney General David Eby says:
“Our
government has taken on the difficult work of fixing the problems left behind
at ICBC, including implementing the very solutions the old government was told
could have prevented this mess. The changes will come into effect in the
spring, which will significantly reduce the legal costs associated to minor injury
claims and provide enhanced care for people injured in crashes.”
“We are
also undertaking a historic modernization of our public auto-insurer to make
insurance rates fairer for people in BC”, he continued.
The question still remains though, do we
still need ICBC? Not according to Milke:
The case for ending
ICBC’s monopoly is straightforward and based on a number of empirical
realities: First, the reality of political
interference – past, present and (just as likely) in the future; second,
the reality of monopolistic behaviour in the marketplace and conversely, the
effect of competition in the marketplace; third, the example of past successful
decisions in Canada and in other liberal democracies to return government-owned
businesses to the private sector as a means to a competitive, consumer-friendly
market.
And while Eby’s plan alleges it will put ICBC on a path so that it can once again
work in the interests of all drivers in BC.... the risk of political interference, by whichever
government is in power, will always there.
Which is perhaps why Mark Milke suggested 6 options for the future of ICBC.
Of those 6, there
were three most which he believed to be the most consumer-friendly:
... close and wind down the operations of ICBC, and
then allow full competition once again
... allow for the break up of ICBC, into its
various components, thus creating smaller companies in competition with each
other ... along with full competition for consumers by private insurance
companies
... a Vancity Credit Union / Mountain Equipment
style co-op, which would be owned by, and exists for, the benefit of its
members ... plus full competition
The third option is in keeping, interestingly
enough, with policy of the BC Conservative Party. Interim leader Scott Anderson today stated:
“Four months
ago, before this latest news of financial cratering within ICBC, we stated that
a full overhaul was what was needed”.
Again, let me say clearly and without reservation, "ICBC needs a full overhaul!"
“While David Eby blames the previous BC
Liberal government for, according to him, not acting on clear solutions, Mr.
Milke was correct in his assertation that the reality of political interference
has occurred by all governments in the past”, Anderson continued.
"The Liberals used it as a piggybank and the
NDP's answer has been to tinker with it, all the while keeping it tangled in a
massive bureaucratic rat's nest, still embedded in an archaic Crown Corporation.”
Last
September, the BC Taxpayers Federation pointed out that BC drivers paid the second highest auto insurance rates in Canada –
higher than in neighbouring Alberta. They also stated that between 2011 and
2015, BC had the second highest percentage increase in rates, behind only the
province of Saskatchewan.
That makes sense given that last year British
Columbians faced an average increase of 8%, or roughly $130 ... and if approved by the BC Utilities Commission, the
new 6.7% rate increase will
add another $60 on average for personal basic insurance coverage.
On
hearing news of the latest rate increase coming up for ICBC, the Conservatives Scott
Anderson observed:
“The BC Conservatives will turn ICBC into a co-operative, ensuring that
BC drivers who pay premiums will be the ones who own the organization. A
co-operative will work in drivers’ best interest, rather than serving the
government of the day".
"We will also open the industry to private
competition, to help drive rates lower”, he concluded
Yesterday the NDP’s David Eby told British
Columbians that we deserve a government that will be accountable and
honest about ICBC’s current financial challenges.
He concluded
by saying, “We have put ICBC on a path so
that it can once again work in the interests of all drivers in BC”
Time
will tell ... and so will the voters of BC come next election, as this will
likely be one of the key factors impacting our ballot choice.
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