Law Times

PAGE 12 Worker, employer advocates debate province's response to Arthurs report Government moves on WSIB funding issue FOCUS B BY JUDY VAN RHIJN For Law Times to the recent report on the fi- nancial health of the Workplace Safety and Insurance Board with increased costs to employers among the top concerns. Employee and employer ad- usiness leaders and their counsel are re- viewing the Ontario government' s response goode Hall Law School pro- fessor Harry Arthurs' funding review in May, the government moved quickly to implement his strategy for achieving full fund- ing. It passed regulations on June 5 providing that the WSIB shall maintain an insurance fund in order to achieve the following Following the release of Os- s long-term heath. sufficiency ratios by the fol- lowing dates: 1. 60 per cent on or before Dec. 31, 2017. 2. 80 per cent on or before Dec. 31, 2022. 3. 100 per cent on or before Dec. 31, 2027. WSIB chairwoman Eliza- vocates are also debating the is- sues the report raised or failed to address as both sides focus on the system' beth Witmer, appearing be- fore the standing committee on government agencies on July 4, confirmed the board is on course to eliminate its unfunded liability by 2027. The unfunded liability repre- sents the shortfall between the money needed in the WSIB' insurance fund to pay the ben- efits owing to workers and the amount that' s Hicks Morley Hamilton Stew- art Storie LLP, chairman of the Ontario Chamber of Com- merce' Jason Mandlowitz of employers are supporting the s WISB task force, notes s actually there. 'The goal of full funding in 2027 is a supportable one,' says Jason Mandlowitz. funding goal. "They are hop- ing the workers' compensation system will be put on a sustain- able footing once and for all, ing the evaluation process that led to the current review of WSIB operations. That review articulated the idea that the WSIB has been suf- fering from an identity crisis. "One isn't sure if it is an in- surance program or a social policy program, and years of government intervention haven't clarified that," says Mandlowitz. "There is a recognition that the WSIB needs to be put on an insurance footing." it in 15 years is the low end of what was required. To do it any quicker would be adding too much cost to the current generation and the immedi- ate next generation." He credits the 2009 audi- tor general's report for start- says. "The goal of full funding in 2027 is a supportable one. To do " he requirements of an insurance program as having set rules, strategic direction, and the Mandlowitz identifies the discipline to meet goals and ob- jectives once set. Mandlowitz is adamant, how- ever, that the funding goals won't succeed in isolation. He points out that the 30-year amortiza- tion plan implemented in 1984, although well intentioned, never achieved its goals because every party in government tinkered with the system over and over again. "For this plan to work, other things have to occur, as Arthurs realized. If you impose more costs, you make it more difficult to implement 100-per- cent funding. There needs to be a clear strategy that parallels the changes up to 2027." The WSIB acknowledged this before the standing committee in coupling the implementation of the report' tions with sound management practices. Employers say the WSIB must go back to merited principles. "It must be adminis- tered by an arm' s recommenda- says Mandlowitz. "There must be a long-term funding strategy and long-term objectives and targets built in and an obligation to report back to stakeholders and government periodically to identify that it is on track or advise what needs to be done if it is not on track. "Secondly, the board' vestment strategy, as one of the key drivers of revenue, must be scrutinized to ensure the WSIB is getting the best return. Every dollar that they earn that way is a dollar they don't have to get from premiums. That requires actuar- ial assumptions and calculations as well as mega-year planning. s in- Mandlowitz recommends the adoption of techniques used by insurers to comply with legisla- tion that prohibits them from running a deficit. Mandlowitz also targets " OctOber 15, 2012 • Law times s-length agency," What do your clients need? The means to move on. Guaranteed. Baxter Structures customizes personal injury settlements into tax-free annuities that can help your clients be secure for life. » Pre- and post- settlement consultation and support » Caring professionalism for over 30 years » No fee to you or your clients ™ savings from administrative efficiencies. In fact, Witmer advised the standing commit- tee that in 2011, the WSIB had its first operating surplus in 10 years with revenue covering costs due to strong operational results. She cited a series of im- provements such as in-sourcing labour market re-entry and re- turn to work efforts; a medical strategy to provide better, more timely care; and expanded elec- tronic services. While the minister of labour FREE BAXTER APP! FREE BAXTER APP! Need more information? DOWNLOAD OUR HANDY PRESENT VALUE/LIFE EXPECTANCY APP FOR YOUR MOBILE DEVICE AT BAXTERSTRUCTURES.COM DOWNLOAD OUR HANDY PRESENT VALUE/LIFE EXPECTANCY APP FOR YOUR MOBILE DEVICE AT BAXTERSTRUCTURES.COM Contact us at 1 800 387 1686 or baxterstructures.com announced an intention to in- crease benefits to injured work- ers on partial disability by 0.5 per cent in 2013 and another 0.5 per cent in 2014, Mandlowitz doesn't believe benefits are a key factor. "If B.C. and Alberta are running surpluses at the same level of benefits, maybe benefits are not the issue. sultation period on other issues raised by Arthurs' report. They include premium setting, rate groups, and incentives for em- ployers. LT Baxter_LT_Jan9_12.indd 1 www.lawtimesnews.com 12-01-05 4:13 PM The WSIB is opening a con- "

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