On Monday the provincial monopoly on auto insurance submitted a request to freeze rates on basic insurance for two years despite ICBC reporting to have hemorrhage $625 million from their front line.
“There will be no increases to ICBC’s overall basic rate for the next two years,” Eby told reporters. “This will help keep insurance affordable for British Columbians at a time when people are facing significant cost pressures.”
Dipping in to ICBC’s finances in a bid to boast their popularity even if the crown corporation can’t afford it is nothing new in British Columbia, this has been done in the past by the BC Liberal government.
BCUC is an independent regulator in law and also supposed to be when it comes to practice What will happen if the commission decides the rate freeze is not affordable?
Everyone has the right to speculate at this point that Eby will just override it like money aint a thang. The BC New Democratic Party already has a history of interfering with the commission and two of those incidents were just this year.
The BCUC was directed by the John Horgan cabinet to approve an ICBC “rebate” in the spring. Then, Eby announced a B.C. Hydro credit on his first day in office, backed by a cabinet order instructing the commission to validate the credit with no questions asked.
During the announcement of ICBC’s request for a rate freeze reporters asked Eby if he will overrule the independent commission if it decides it’s not affordable to freeze the rate like it did five years ago with the request to freeze BC Hydro rates.
David Eby danced around the question saying he will review the decision from the commission if that is the case.
“So, the commission has an important role to play here,” replied the premier, then added: “We will, of course, review any decision made by the commission.”
No answer was given by Eby about overruling the commission if turn down ICBC’s request to freeze rates. Eby was hit with a follow up question around the same theme because he didn’t answer it the first time and gave a long winded answer much like the first.
“We’re very grateful to the utilities commission for rendering their opinion on this application,” replied Eby. “We’ll review that when we receive it. And British Columbians should know that our first priority is making sure that life is more affordable for them.”
The take away here appear to be that the commission if free to make any decision they so choose but it better be in line with that of the BC NDP government.
While sneaky Eby was at the podium refusing to answer the question about overruling, it was soon found that a decision appears to have already been made.
After the media conference it was discovered the cabinet has already signed an order to direct the commission to freeze ICBC rates.
Cabinet Order in Council 666 – that’s right 666 is the actual number, is the one that directs the commission to stretch the freeze from “the period beginning on April I, 2023 and ending on March 31, 2025”
The directive also tells the commission they are not to raise the rates for the two years unless ICBC asks.
“during the 2023 policy year, refrain from issuing a general rate change order for that policy year unless the corporation applies for the order” written in the order.
The way all these details have come to light and Eby’s answers it suggests that if the request to freeze rates is rejected by the commission, which could take months, Eby will just overrule it like the BC NDP has done several times already in the past with other BCUC decisions.
The most recent statement from the Finance Ministry raises some concerns about the affordability issue and the financial stability of ICBC. ICBC was expected to end the year $327 million in ahead in the spring budget. That projection was changed to a $298 million loss in the financial report for the first half of the year, which was released on November 25.
The government insists the $625 million loss if all from the investment arm of the crown corporation while the Finance Ministry statement also says there is a predicted $700 million increase to ICBC claims payouts.
If things don’t pan out the way Eby hopes, he and his colleagues could be playing a game of their own hide the ICBC dumpster fire before they face voters in the next election.
Voters have two years to find out, unless this is a smoke screen for an early election to bolster the BC NDP’s popularity. A new poll was released the other day that revealed residents of B.C. say the BC NDP is failing on all of the top issues.
Eby may need to look elsewhere to to pay for the rate freeze if ICBC fails to reach a sufficient financial result. Eby claims he will not raid the capital reserves and use it like the BC Liberals did but there isn’t many more places to dip in to.