Freeze demand at odds with MPI payouts
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Hey there, time traveller!
This article was published 13/01/2021 (629 days ago), so information in it may no longer be current.
There was quite a collision earlier this week at the intersection of Transparency and Ideology. And yes, injuries were reported.
The incident in question began with the report that Manitoba’s Progressive Conservative government, citing financial hardship created by the ongoing COVID-19 pandemic, demanded that a two-year wage freeze be imposed on employees of Manitoba Public Insurance.
That, in itself, was hardly cause for screeching tires or rubbernecking curiosity — under Premier Brian Pallister’s watch, the province has fought tooth and nail to keep public-sector wages in check, often using its long-unproclaimed Public Services Sustainability Act as a cudgel in demanding negotiated freezes or simply refusing to negotiate new contracts.
But what turned this latest stretch of the government’s one-way flow of labour-relations traffic into a dangerous ideological interchange was the revelation that two days before it laid its wage-freeze demand on MPI, the province quietly signed a new agreement with the Insurance Brokers Association of Manitoba, assuring brokers an ongoing cut of online sales of MPI products that will produce an estimated $23-million increase in commissions over the next five years.
The new deal guarantees brokers a percentage of online Autopac renewal fees “whether they do anything to earn it or not,” said the union representing MPI employees in a letter sent to Crown Services Minister Jeff Wharton on Jan. 5. The agreement was signed as a result of conciliation efforts to settle a dispute over the future of online product sales.
MPI’s internal financial models showed the Crown corporation could save millions of dollars in broker fees if its products were available for purchase online. Brokers did not oppose the greater use of online insurance purchases, but insisted such transactions must go through them — even if the customer doesn’t ask to consult a broker or uses the public insurer’s website.
While brokers provide a retail presence for MPI that is a benefit to policy holders and merits some sharing of revenues from online Autopac transactions, the deal forged by the Pallister government seems unjustifiably rich.
The new contract had not been publicized by either the government or IBAM.
“All Manitobans are meeting unprecedented disruption and hardship,” Mr. Wharton wrote in a letter to MPI leadership that laid out the government’s collective-bargaining mandate calling for an immediate zero per cent compensation increase for the next two years.
While there’s no doubt many in this province have been hit hard by the pandemic’s financial impacts, one might be inclined to argue that MPI has been spared. It is in the process of returning $69 million in rebates to customers as a result of decreased vehicle traffic having led to a 20 per cent reduction in collision-related costs.
MPI’s ability to share the wealth with brokers and ratepayers is understandably galling to the employees responsible for providing its services. Michelle Gawronsky, president of the Manitoba Government and General Employees’ Union, was justified in asking, “Where’s the fairness? Where’s the transparency?”, after learning that the same government that seeks to pre-empt any effort at negotiating a new agreement reflective of MPI’s current financial realities has offered brokers a steady five-year flow of commission income.
The strain of COVID-19 might otherwise have provided the Pallister government with ample cover for continuing its campaign of public-sector wage suppression, but the numerical contradictions related to MPI have proved rather jarring.
Mr. Wharton would have been well advised to look both ways before proceeding. There’s little doubt investigators at the scene would judge this collision to have been completely avoidable.