BC's fuel rebate is nothing but political smoke and mirrors

Mar 25 2022, 11:50 pm

Premier John Horgan could have used a fog machine at his press conference on fuel rebates Friday, such was the smoke and mirrors show he was trying to pull on British Columbians with his announcement.

Horgan unveiled a one-time financial payment of $110 for drivers, or $165 for commercial operators, which he said his government had specially crafted to address the rising cost of gasoline caused by Russia’s recent invasion of Ukraine.

But look a little closer and you’ll come to a surprising revelation: This is money you already spent, and were entitled to get back anyway.

The source of the $395 million “fuel rebate” is the Insurance Corporation of BC, which overcharged motorists for auto insurance in the last year, contributing to an enormous profit of $1.9 billion.

ICBC was likely to have to return some of this money to motorists in the form of a rebate, like it did twice during the COVID-19 pandemic when fewer crashes and good investment decisions left the public auto insurer with similar extra profits.

But the Horgan government saw a shrewd political opportunity instead.

After weeks of rising voter unhappiness over gas prices, and faced with other provinces like Alberta offering large rebates to drivers, BC swooped in and issued a cabinet order to ICBC’s board, taking some of the profits and rebranding the money as a new “fuel rebate” – even if the money wasn’t new at all.

Perhaps that’s one of the reasons the announcement on Friday felt like a sloppy rush job.

ICBC confirmed on its website that electric vehicle owners were also entitled to the so-called gas rebate, even though they hadn’t spent any money on gasoline.

“Electric vehicle owners have also contributed to our strong financial position through their insurance premiums, just as all customers have,” read the ICBC Q&A page, confirming it’s overseeing an auto insurance rebate and not a fuel rebate.

That led to a round of social media mockery, until, stung, government communications folk suggested to some journalists that the expectation is that electric vehicle owners are “encouraged” to donate their $110 rebate to charity.

Apparently, the premier couldn’t bring himself to say this out loud during his 30-minute press conference, nor could the Solicitor General, nor any government ministries, nor even ICBC itself in its written material. You needed telepathy, it would appear, to understand the government’s actual intent with the rebate. That’s never a sign of good public policy.

Horgan also faced questions about whether he was “raiding ICBC for profits” like New Democrats have long claimed the previous BC Liberal government did to help fund political programs and priorities, leading to the financial “dumpster fire” at ICBC that nearly drove it to bankruptcy in 2018.

“I don’t believe we are,” said Horgan.

The problem, he added, was that the BC Liberals were “dipping into reserves from ICBC to pad their budgets.” New Democrats clearly feel their approach, to take the same money but only give it back to motorists in carefully-branded rebates for political purposes, is far more morally-superior than when the Liberals used it for general budget purposes on things like health care, education or public transit. 

That may be a difficult logic knot to detangle in the minds of some voters – especially those who’d prefer to see the ICBC money used to ward off the 2.3 per cent hike to fares that TransLink announced this week, or even make public transit free for a time.

“We believe TransLink and BC Transit are operating in the public interest, they need to manage their fleet, they need to manage their fare box, to complement the resources they can get through gas taxes and any direct contributions from orders of government,” said Horgan.

“We believe this is the best way forward to ensure we’re addressing areas where there is no access to public transit.”

Public reaction to the government announcement was generally unfavourable, with most noting that $110 is barely enough to fill up the tank twice with current prices.

That’s true. But it also misses the larger point: That was already your money. The government just repackaged it, and hoped you didn’t notice.

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Rob ShawRob Shaw

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