Law Times

Page 6 May 6, 2013 • Law TiMes COMMENT u Editorial obitEr By Glenn Kauth Targeting insurance fraud A uto insurance premiums are an easy target when it comes to public policy matters in Ontario as most people hate to pay more to drive a car. So it was no surprise that the provincial government took aim at that issue in its budget last week. Among other things, the budget seeks to reduce premiums by 15 per cent through a number of measures, including a crackdown on fraud. Insurer profits are sure to come under the microscope as the government seeks to cut premiums. But as a Law Times story on page 9 this week points out, determining the insurance industry's financial picture isn't an easy task. As hearings on the sector resumed last month before the legislature's standing committee on general government, the Ontario Trial Lawyers Association was touting data that put the total cost of claims at $6.5 billion. The Insurance Bureau of Canada, meanwhile, says it's $8.15 billion and maintains the industry earned a 5.5-per-cent return on equity in 2012, a number far below the 12-per-cent regulatory standard. The industry argues any premium cuts would wipe out profits while the lawyers' association claims insurance companies have been making big money since the province reduced benefits in 2010. So we have conflicting numbers on a signature policy in the budget. What are the true figures and will the budget changes make any difference to consumers? Those are questions the government should move quickly to answer. While it's an area of significant consensus for the general public, insurance is a hotly debated area for those with a bigger financial stake. Consumers, of course, want good benefits for reasonable prices while companies prefer the opposite to ensure solid profit margins. But one issue where there seems to be a fairly solid meeting of the minds is on insurance fraud. So given the divide more generally, that's an area where the government should focus its limited resources in order to make a difference by rooting out bogus claims. It's not as though anyone can deny it's a problem. Statistics show the cost of the average claim in Ontario is far higher than other provinces despite the fact that accident injury patterns don't vary dramatically across Canada. Given some of the fraud cases we've seen, it's clear that bogus and inflated claims are part of the problem. Fortunately, a task force has been considering the fraud issue for some time. In a recently released report, the task force made a number of recommendations. They included regulating the health-care clinics often fingered as sources of fraud, better use of data analytic technology to identify suspicious cases, and increased investment in prosecutions. Obviously, none of these solutions is a panacea, but given the political minefield involved in auto insurance, they're a good start for aggressively targeting the government's efforts to cut premiums. — Glenn Kauth Harper launches latest labour relations salvo at Crown corporations L ast week, the Conservative government brought in legislation to essentially take over the CBC, VIA Rail, Canada Post, and 46 other Crown corporations. It will decide how much workers will earn — whether unionized or not — how much they'll work, and their pensions when they retire. A cabinet representative will sit in on labour negotiations with the unions and report back to Prime Minister Stephen Harper. Harper will have a final say on everything. The provisions in bill C-60 effectively end the independence of Crown corporations and the arm's-length relationship they've had with the federal government since Confederation. That's the way Harper wants it. He'll rule the roost from now on and will call all of the shots. As a result of the bill, the CBC will have to meet the budget the Harper government sets for it. So will VIA Rail and Canada Post. The Harper government will effectively end up deciding which routes VIA Rail will keep, what services it will offer, Law Times previous Conservative election and how much it will charge for tickets. As for Canada The Hill campaigns before taking their roles. Is that a coincidence? Post, Harper will decide what What chance is there to privatize, how much mail those nine will side with the it will deliver, and how much unions and against Harper at sending a letter will cost. the bargaining table during The government introduced contract negotiations? bill C-60 on International If that isn't enough, the Workers' Day. Behind the curfederal cabinet gets a say on tains in the House of Commons, some Conservative MPs Richard Cleroux anything approved at the negotiating table. Soon, Harper were laughing that it was a nice will be deciding the colour of Peter birthday gift for the unions. Publicly, officials will maintain the Mansbridge's tie. Bill C-60 will give the Harper cabinet CBC, Canada Post, and VIA Rail are still Crown corporations that have an arm's- the power to set contract bargaining as length relationship with the government. well as salary limits and worker benefits. But when somebody else controls how An official who reports back to the Treamuch you pay your workers, what sort of sury Board Secretariat will be sitting in control do you have over who you hire, the on labour negotiations making useful suggestions. We'll know where they're work they do, and the services you offer? There's nothing surprising in all this. coming from, of course. With five big labour contracts up for Harper and his people have been moving in this direction for years. Look at the renewal before 2015, there could be some control Harper has over the CBC right nasty strikes at the Crown corporations. now. Nine of the 11 board members Harper will be able to argue, as his people at the CBC are Harper appointments are already saying, that his government and every one of them contributed to stood up to the union bosses on behalf of Thomson Reuters Canada Ltd. One Corporate Plaza, 2075 Kennedy Rd., Toronto, ON • M1T 3V4 Tel: 416-298-5141 • Fax: 416-649-7870 • www.lawtimesnews.com Group Publisher . . . . . . . . . . . . . . . . . . . Karen Lorimer Editorial Director . . . . . . . . . . . . . . . . . . . Gail J. Cohen Editor. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Glenn Kauth Staff Writer . . . . . . . . . . . . . . . . . . . . . . . .Yamri Taddese Staff Writer . . . . . . . . . . . . . . . . . . . . . . Charlotte Santry Copy Editor . . . . . . . . . . . . . . . . . . . . . . Mallory Hendry CaseLaw Editor . . . . . . . . . . . . . . . . . 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Publications Mail Agreement Number 40762529 • ISSN 0847-5083 Law Times is published 40 times a year by Thomson Reuters Canada Ltd., 2075 Kennedy Rd., Toronto, ON, M1T 3V4 • 416-298-5141 clb.lteditor@thomsonreuters.com circulations & subscriptions $179.00 + HST per year in Canada for print and online (HST Reg. #R121351134), $145 + HST per year for online only. Single copies are $4.50. Circulation inquiries, postal returns www.lawtimesnews.com Canadian taxpayers. It's a great way for him to line up votes going into an eleciton. Since the Harper government will ultimately end up making hiring decisions at the CBC by setting remuneration for everybody, it gets to choose the content as well. Maybe the CBC will have to carry content from Harper's favourite channel, the Sun News Network, if it folds. People are always talking about Harper's secret agenda. Are they kidding? Harper told us all of this was coming. Remember all of those Reform and Canadian Alliance MPs who knocked the CBC, VIA Rail, and Canada Post? So what did we do? We voted Harper into office. What's the guy supposed to do? We expect him to keep his promises. It would be dishonest for him not to. In democracies such as Canada, people get the governments they vote for. That's the way democracy should work. The fault, if there is one, is ours. LT uRichard Cleroux is a freelance reporter and columnist on Parliament Hill. His e-mail address is richardcleroux@rogers. com. and address changes should include a copy of the mailing label(s) and should be sent to Law Times One Corporate Plaza, 2075 Kennedy Rd. Toronto ON, M1T 3V4. Return postage guaranteed. 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