The Insurance Corp. of B.C. is reducing staffing and other costs to the point where it’s climbing out of deficits and stabilizing its operations, Attorney General David Eby said Tuesday.
Eby said he was surprised to see the extent of legal costs when ICBC reported its detailed financial figures for the 2018-19 fiscal year, and they validate the NDP government’s decision to cap minor injury awards and attempt to restrict expert witnesses in major injury lawsuits.
“This is the first year we’ve reported these numbers, so they definitely were eye-opening for me,” Eby told Black Press. “When you look at the amount of money that was going to the plaintiff law firms, and assuming a 20- to 30-per-cent contingency fee agreement, that ends up being about half a billion dollars in just lawyers’ fees. It’s a very significant cost to both ICBC and motorists, and it should be a concern to people.”
Eby rejected media reports suggesting that staffing levels and salaries above $150,000 per year have increased, describing a misunderstanding of financial reports released by the Crown corporation last week.
“When I took over ICBC in 2017-18, there were too many people earning high-level category salaries,” Eby said. “We’ve reduced every category above $100,000 by a minimum of 10 per cent, and for those above $150,000, by more than 30 per cent.”
Attorney General @Dave_Eby says media reports that BC is again taking a dividend from #ICBC are “a misreading of the books” #bcpoli #bcleg pic.twitter.com/byAcSbkiUb
— Tom Fletcher (@tomfletcherbc) October 29, 2019
Another issue Eby addressed with reporters at the legislature was the emergence of a possible return to surplus in ICBC’s current year, which he said has been incorrectly reported.
“The second point of frustration I have is the suggestion that government is taking dividends from ICBC, or is planning on taking dividends from ICBC,” Eby said. “The books reflect the hope, and at this point it is a hope, that ICBC will be revenue positive. When ICBC is revenue positive in government’s consolidated books, it reflects as money coming to government. It’s how it’s reported in the books. It doesn’t mean it’s a dividend paid by ICBC.”
The province’s current budget, presented Feb. 19 by Finance Minister Carole James, included billion-dollar bailouts of ICBC and B.C. Hydro. By February ICBC was projecting a $1.18 billion loss for the fiscal year that ended March 31, adding up to a total loss over two years of $2.5 billion.
Legal fees is one area where ICBC is seeing an improvement for 2019-20, along with a slight decrease in crash figures that have climbed to record levels.
“We’re seeing a slight decrease in the representation rate, the number of people who are hiring lawyers, which is good news,” Eby said. “We’re seeing the first quarter, where ICBC has reported near break-even.”
Like us on Facebook and follow us on Twitter.