Winnipeg Free Press - PRINT EDITION

MPI ex-boss negotiates $180 hourly rate

Tories denounce contract as rate hike sought

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Manitoba Public Insurance will pay its former chief executive officer $180 per hour, in part, to plead poverty before a provincial regulator later this year.

Marilyn McLaren's consulting contract with MPI calls for her to work 21.75 hours per month for $3,900.

Copies of the contract were distributed to reporters Monday by the Conservatives, who obtained it under a freedom-of-information request. The Selinger government had said her full contract is worth $50,000, but provided no details.

'I think if you're going to the Public Utilities Board and (making) the case that you're running out of money, you shouldn't pay somebody an enormous amount of money to make the case for you'

-- Tory Leader Brian Pallister

The contract does not specify McLaren is to help MPI prepare its 2015 rate application or its defence of that application before the Public Utilities Board.

However, Andrew Swan, the minister responsible for the public auto insurer, has repeatedly said McLaren's experience will be invaluable to MPI in that regard. Sources have told the Free Press MPI will seek a general rate increase of around five per cent.

"I think if you're going to the Public Utilities Board and (making) the case that you're running out of money, you shouldn't pay somebody an enormous amount of money to make the case for you," Conservative Leader Brian Pallister said Monday after Tory MLAs raised the issue during question period. "I would think that would be self-defeating on the face of it."

Swan would not comment on the Free Press report, calling it "speculation." He said MPI's general rate application is still being prepared.

"I think everybody in Manitoba knows it's been a difficult winter," Swan said. "We know there have been more claims than in typical years. Unfortunately, those claims have been more expensive."

Under further questioning, Swan indicated any rate hike MPI seeks would be less than the 5.2 per cent request made in February by MPI's Saskatchewan counterpart, Saskatchewan Government Insurance.

"I can't speculate on what the actual number will be, but we will continue to be lower than Saskatchewan. And Manitobans will continue to have lower premiums than any other province in Canada," Swan said.

At the same time, he said, MPI is "under an obligation to manage its costs."

It will go to the Public Utilities Board in June with "information on how they've been able to contain those costs this year," he added.

McLaren retired Feb. 21. The corporation has pegged her 2014 compensation at $488,991, not counting the consulting contract. Most of that amount consists of a retirement payment of about $400,000. In order for MPI to hire McLaren on contract, the Manitoba cabinet had to pass a special order overriding provincial conflict-of-interest rules that forbid senior bureaucrats and Crown corporation executives from receiving contracts within 12 months of departing.

In June, Manitoba Public Insurance is expected to release its annual report for the fiscal year ending Feb. 28. A source said MPI will post a substantial financial loss for the second year in a row, due to mounting collision claims.

larry.kusch@freepress.mb.ca

Republished from the Winnipeg Free Press print edition May 13, 2014 0

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