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The BC Liberals have completely mishandled ICBC, and the proof came on Thursday, when a review showed that the company has been hiring boatloads of senior managers and paying them more each year — with the government apparently oblivious to this fact.
There are 32 per cent more managers than in 2007, and they are paid (as a group) 70 per cent more than managers received in 2007. Fifty-four of them made more than $200,000 each in 2011.
The Liberals insisted, on taking office in 2001, that ICBC didn't need to be privatized, nor did there need to be complete competition in the auto insurance sector. They merged ICBC operations with the motor vehicle branch, and had ICBC contribute to policing initiatives, and thus thoroughly muddled it with legitimate government activities. This has made it very difficult to unwind ICBC, the insurance company, from ICBC, the public policy arm.
They have also insisted, especially in recent years, that substantial dividends from ICBC go back to the shareholder — the government. This means that all ICBC customers, and that's everyone who owns a vehicle, are paying additional insurance premiums to boost government revenues. This is not a commercial transaction — it's a tax grab, hidden in the guise of insurance costs.
The government has now, very belatedly, said ICBC needs to cut its management costs and manager compensation. This comes just after ICBC has boosted insurance rates by 11.2 per cent.
The simple fact is this: ICBC is being used by government for all sorts of purposes that are far afield from its ostensible role as a public car insurance company. This isn't new — the NDP did this with ICBC back in its earliest days. But it certainly points out that the Liberals are just as good as the NDP at mismanaging Crown corporations and sticking taxpayers with extra costs.
ICBC needs to be privatized. This of course won't happen under a new NDP government, nor under a re-elected Liberal government. ICBC is a sacred cow.
There is no real need to have government operate a car insurance company that forces all drivers to buy at least basic car insurance. Competition is allowed for what the government considers "optional" coverage, such as collision or comprehensive.
If there was true competition in all aspects of car insurance, most good drivers would see their premiums reduced. They most certainly would not be paying an additional amount to the insurance company which ends up in government coffers.
ICBC has been mismanaged by both the NDP and the Liberals. It should be sold off, but that won't happen any time soon. Drivers will just keep paying more than they should for car insurance.