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The dismissal of the Manitoba Public Insurance (MPI) board by the Kinew government raises serious questions

Graham LaneCanada’s economy is slowing. Canadians are being buffeted by dramatic interest rate hikes and are worried about the economy and employment. Policymakers hope that higher interest rates will reduce Canada’s high inflation rate as people respond to higher costs for housing and basics like groceries.

And here in Manitoba, Manitobans also find themselves in the midst of what could turn out to be a severely tumultuous political changeover, with an uncertain future. The New Democratic Party, led by Wab Kinew, defeated the PC party in last month’s election, ending the PC government’s rule since 2016.

Kinew’s limited experience in legislative politics mirrors that of most of his colleagues in the legislature. So, it won’t be surprising that his government will make bold moves, some of which will backfire.

Manitoba Public Insurance MPI
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One of his government’s first moves after the election was the sudden turfing of Manitoba Public Insurance’s board of directors, with all but one MPI director removed. It is no surprise that the replacement directors were chosen for being loyal compadres to the Kinew government first. It was certainly not for their knowledge and experience with insurance and matters of policy that impact MPI.

Before and after the election of the Kinew government, the then MPI board of directors was dealing with a lengthy strike by MPI’s 1,700 unionized employees seeking ‘better’ wages.

By election day, the strike had been going on for nearly two months, severely hampering MPI’s operations. MPI services were operated on a very minimal basis by the few hundred remaining non-union employees.

The stakes were high for both sides, with the union trying to get as much as possible by walking out and the board of directors wanting to minimize any changes and adjustments. These diametrically opposed positions made reaching an agreement difficult. The union had an opportunity to end its strike in mid-September when the MPI’s board agreed to put the result with a mediator. Instead, the union stretched the strike out for another month and then another fifteen days. Ultimately, the union was rewarded for waiting – when the government changed.

Since the strike began, a backlog of 11,000 accident claims and 16,000 road tests has developed as the walkout and continued strike shut down MPI’s critical operations.

Malcolm Bird, a University of Winnipeg political science professor who studies Manitoba Crown corporations, has suggested that Crown corporation boards are partisan and politicized, and new Manitoba governments don’t trust a board appointed by another party.

Bird has noted that it is not the standard practice of provinces or the federal government to overhaul Crown corporation boards when there is a change in government. He observes that those sitting on a Crown corporation board are supposed to have a fiduciary responsibility to the organization and consider its long-term health. But Bird was not surprised by the dismissal of MPI’s board.

In the end, the union’s members won. They will get about 17 percent pay adjustments over four years, plus lump sum payments worth another $5,000. As well, MPI cannot lay off union members for the duration of the agreement.

Were Manitobans served?

Certainly not.

Graham Lane had a 40-year career as an executive in both the private and public sectors, including a stint as MPI’s Acting CEO. He is a retired CPA CA and PUB Chair. He sits on the expert advisory panel of the Frontier Centre for Public Policy.

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