Moving Autopac online would be tricky business
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Hey there, time traveller!
This article was published 27/03/2019 (1454 days ago), so information in it may no longer be current.
Another week, another scrap between Manitoba’s Progressive Conservative government and the board of a Crown corporation.
However, this time, Autopac is involved. That is a game changer in so many ways.
Few government entities are more politically volatile than Autopac and the Crown corporation that delivers it, Manitoba Public Insurance. It doesn’t matter whether the news is good or bad, it seems that Manitobans love to angrily debate the morality of the province’s auto insurance monopoly.
This most recent battle between the MPI board and the government of Premier Brian Pallister is a good case in point.
The Free Press reported this week that MPI’s bid to move insurance and licence renewal to an online platform could be kiboshed by the Tory government. Crown Services Minister Colleen Mayer denied giving a formal, written directive to anyone at MPI, but the MPI board sought a legal opinion about whether the government had the authority to stop them from moving the licence and insurance renewals online.
The decision to obtain a legal opinion is evidence that someone high up in the Pallister government said something to someone at MPI.
Why would the provincial government be so concerned about self-service, online renewals? In this day and age where so much of our lives involve online transactions, moving annual renewals online is a no-brainer.
Unfortunately for those people who resent their annual trip to renew licences and insurance in person, the Tories have a political stake in maintaining the status quo. Pallister is trying to avoid a fight with private insurance brokers, a political constituency that has always hit a little bit above their weight when it comes to Tory governments.
Everyone who owns a car in this province understands that private brokers are the retail face of the Autopac system. In the past 20 years, brokers have worked their way deep within the Autopac renewals system until now, it is really the only place that most of us go to renew.
It’s a system that has advantages for taxpayers. All of the overhead of maintaining the offices, and paying the people who staff the counters, is covered by the brokers. With nearly 300 private brokers in the province — and locations that include grocery stores, shopping malls and strip malls — Manitobans have a fairly accessible retail network for Autopac transactions.
It’s also a sweet deal for brokers. There is no fee charged to brokers for the right to represent MPI. As well, the Crown insurer pays out more than $80 million annually in commissions to brokers and covers all of the costs of the Autopac online system that facilitates licence and insurance renewals. MPI even pays for the cameras and scanners used by brokers to process renewals.
Brokers have fought stridently for the role they play in the Autopac system. Quietly, they argue that commissions are really only one benefit of selling government auto insurance; many also note that Autopac functions as a powerful marketing tool, getting live bodies in through the door where they can inquire about other insurance products.
More importantly, allowing brokers to play an important role in government auto insurance plays well with those Manitobans who resent the government’s monopoly. It would not be a stretch to say that a good many of those Manitobans vote Tory.
That political reality has allowed the Insurance Brokers Association of Manitoba, the industry’s lobby group, to establish a close relationship with PC governments over the years to ensure the plan being looked at by MPI does not move too quickly.
The conflict between MPI and the provincial government is consistent with battles it has waged with two other politically appointed Crown corporation boards. Battles that have, at their core, a disagreement about how much influence the premier should have over Crown operations.
In the case of Manitoba Liquor and Lotteries, chairwoman Polly Craik was fired after she and other Tory-appointed board members tried to forge ahead with a $60-million capital expansion of the Club Regent Casino against the premier’s wishes. Craik suggested government officials had provided back-channel instructions directly to MLL management — a real no-no in the world of Crown corporation governance — to undermine the expansion plans.
In Pallister’s battle with Manitoba Hydro, he and former board chairman Sanford Riley fought over several issues, including a financial settlement between the utility and the Manitoba Metis Federation. When Pallister insisted on terminating the deal, Riley and the rest of his board resigned in protest.
To be clear, a provincial government is allowed to direct a Crown corporation as long as it done in a public and transparent way, such as through a news release, ministerial statement or media interview, but a premier cannot just call up someone on the board and, unbeknownst to the public, start pulling strings.
With MPI, Pallister now finds himself between a politically tricky rock and a profoundly problematic hard place.
Frustrate MPI’s efforts to expand online services, and the premier runs the risk of angering citizens who long for the opportunity to renew online, at their convenience. Green-light MPI’s plan, and he will almost certainly suffer the condemnation of 300 private brokers who have, as an industry, cultivated a deep reach into the core of his party.
This is a political dilemma that requires some deft political diplomacy, not awkward political duplicity.
Born and raised in and around Toronto, Dan Lett came to Winnipeg in 1986, less than a year out of journalism school with a lifelong dream to be a newspaper reporter.
Updated on Thursday, March 28, 2019 8:41 AM CDT: Typo fixed.