For the Record: Clarifications about CFIB’s claims The WSIB wishes to correct inaccuracies distributed in a news release by the Canadian Federation of Independent Business on September 3, 2009 We are disappointed and seriously concerned the CFIB is once more engaging in a complete distortion of the facts and sabre rattling in order to get media attention and scare their membership unnecessarily. This is a time that they should be working collaboratively with the government, the WSIB and other stakeholders to build confidence and sustainability for the thousands of employers who have been hit hard by the economy. The WSIB has already been reviewed twice by an independent third party and has appeared twice in front of the Standing Committee on government agencies. In fact, the CFIB seems to have conveniently forgotten that they were a stakeholder in attendance at one of the Standing Committee appearances and made recommendations for improving the system, many of which we have implemented. While it is a fact that our unfunded liability is $12.38 billion as of the end of the first quarter of 2009, any allegation that we’re close to financial ruin is outrageous. Yes, we have been hit as everyone has with the economic downturn and due to substantial job losses we lost $105 million in premiums, but the system is financially secure. The WSIB’s investment strategy allowed it to have better returns than many other Canadian pension funds. While disappointing, the WSIB’s investment performance for the year (-15.5 per cent) still outperformed the median return for large Canadian pension funds (which were in the range of -16.0 per cent to -18.0 per cent). The CFIB says that “the WSIB’s plans to rein in system costs have continued for years without success”. In fact, the WSIB is proactively addressing the challenge of rising health care costs while maintaining the best possible care for injured workers. In 2005, health care costs, which are escalating for everyone, were rising by almost 10%. Through our efforts -- particularly strategic sourcing -- we have gradually brought this down to only a 2.9% increase in 2008. WSIB administration costs -- at 13% of revenue -- compare favourably with the average of 19% for Canadian workers' compensation boards. The WSIB’s administrative budget represents less than 11% of the total cost of the system. Since 2004, the WSIB has committed to hold the line on administrative expenses within its control. Controllable administrative expense targets were frozen from 2005 to 2007 and held to minimal CPI increases for 2008 and 2009. For the four-year period 2005 to 2008, the WSIB outperformed these targets by a total of $45 million dollars. In addition, in 2004, a program of strategic sourcing was initiated to improve pricing and service performance for goods and services provided to the WSIB. This has identified nearly $20 million dollars to date in ongoing annual cost savings. The WSIB has launched a wide-ranging Efficiency Review. Efficiency efforts in 2008 alone resulted in savings of $10 million dollars from administration expenses. This year we have found savings and efficiencies in: reviewing our contracts and consultants; making tough, strategic decisions on some of our project work; limiting travel and conferences; increasing strategic sourcing and procurement solutions to lower costs; cutting all senior management increases to 1.5% following the lead of the provincial government; and ultimately ensuring efficiencies across the WSIB, becoming more strategically focused in our efforts, and finding synergies and strategic alignments wherever possible. We have made some tough decisions and found creative, innovative ways to keep costs down, but we are still determined to do better by looking at a number of options for increasing cost-effectiveness while never losing sight of our priorities: delivering the best service we can for injured workers and employers while maintaining a financially sound system. The CFIB says “the WSIB has rebuffed our every effort to work with them to implement measures to make the system more accountable.” Apparently the CFIB forgets meetings that they have attended. Since undertaking a broad-based consultation with stakeholders on all issues facing the workplace safety and insurance system, we have met with them twice – on March 11 and April 29. These meetings are in addition to the many other times this year we have met with the CFIB on other specific issues. Finally, the CFIB says that “efforts to get the WSIB to investigate a “named insured” approach have been ignored.” The fact is that beginning in January 2008, and for the better part of last year, the CFIB participated in a Named Insured working group facilitated by the WSIB. The group, consisting of employer and worker representatives from the construction industry, and representatives of both the Ministry of Labour and the WSIB, reviewed ways of implementing and administering a named insured system for the construction industry. Despite the fact that the WSIB has been unable to find any jurisdiction where a named insured system is used to deal with workplace injuries, several potential models were considered and discussed. By June, however, it became apparent that the members of the group could not agree on a named insured system, or even on the value of having one. Recently, in a July 24, 2009 meeting, the CFIB was invited to contribute practical suggestions about how such a system could work. Although we have received nothing to date, we continue to be open to their input. The WSIB, which receives no money from the government, is completely solvent. Our ability to fund our ongoing obligations, including benefits to injured workers, is unaffected and the system remains secure. We reject the armageddon approach of the CFIB to offer unwarranted accusations and rhetoric at a time when we need to work together. Their agenda is clearly not ours. Ours is to make Ontario the safest place in the world in which to work.