December 13, 2011

Industry reacts to unfunded liability for Ontario Workplace Safety Insurance Board

KELLY LAPOINTE

staff writer

The recently released provincial auditor general’s report highlighted some government oversights but the biggest message was the report’s update on the WSIB unfunded liability, says COCA.

Ian Cunningham, Council of Ontario Construction Associations (COCA) president, said his primary interest in this year’s report was the followup to the auditor general’s 2009 report which addressed the Workplace Safety and Insurance Board (WSIB)’s approximate $12.2 billion in unfunded liability.

There was nothing new in the followup, but it holds promise for Cunningham, who believes it will be in next year’s auditor general report.

“It was simply a followup indicating that he’s not going to let it die and it’s still an active an open file,” he said, adding that he thinks WSIB is generally moving in the right direction.

“I think they’re examining the drivers of increased costs quite carefully and coming to understand what those things are and how they relate to driving costs.”

He does have concerns about the funding review, which will be published next month.

Among the 2009 report’s recommendations were that WSIB focus on the unfunded liability and strive to significantly to reduce it; optimize premium and investment revenues as a critical measure of fiscal health; and reduce total benefit costs through reducing workplace fatalities, injuries and illnesses and promoting early recovery and return to work.

In response, WSIB took action such as creating an independent funding review to seek advice from key stakeholders, which resulted in the 2012 average premium rate of $2.40 per $100 of insurable earnings, an increase from $2.35 in 2011. WSIB also implemented a new Work Reintegration Model to improve return-to-work outcomes. The model involves more early involvement and the use of work transition specialists.

A key focal point in the 2011 auditor general’s report indicated that Ontario’s Green Energy and Green Economy Act authorized the previous government to fast-track the development of wind and solar power projects without many of the usual planning, regulatory and oversight processes. The Act was expected to support more than 50,000 jobs and the report said 30,000 of these are likely to be short-term construction jobs.

There was a message in the election that rural voters weren’t particularly happy with the government’s processes identifying sites for wind energy projects, photovoltaic farms or gas co-generation plants, pointed out Cunningham.

“There will be some delays in the construction of all kind of energy projects,” he said and the new minority government will play a factor in this as well.

“They’ll move ahead however they can, getting support from wherever they can. The government is committed to green energy and they may have to make some compromises in achieving their results,” he added.

“But, they’ll press ahead perhaps more slowly than previously because of the minority government situation.”

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