In the backdrop is the Ontario government's commitment to reduce rates in the province by 15% before August 15, 2015. The chart below breaks down the quarterly rate approval changes following the announcement of the rate reduction strategy in 2013. The third quarter of 2013 has been included although many of the rate approvals for that quarter may have been filed well before the strategy was announced.
Quarter | Rate Change |
2013-3Q | -0.68% |
2013-4Q | -3.98% |
2014-1Q | -1.01% |
2014-2Q | +0.22% |
2014-3Q | -0.11% |
2014-4Q | -0.54% |
Total 2014 | -1.44% |
Total Since Aug 2013 | -6.10% |
The accumulative rate reductions approved by FSCO during this period have been 6.1%. With just 7 months remaining, the government is considerably short of its target and requires further reductions of about 9%. Likely not achievable in the remaining time despite the recent passage of Bill 15 and a number of regulatory changes. The government will not achieve sufficient savings from reduced interest payments and the licensing of service providers to bring down rates another 9%. If the creation of a new dispute resolution system at the Licence Appeal Tribunal has an impact on costs, it will not happen in 2015.
However, the government has not abandoned their rate reduction strategy. That might mean additional reforms may be on the way and that the timeframe for achieving the target will need to be extended. The report on FSCO's Three Year Review has not been released The review was initiated in 2014 and one must assume it was been completed by now. It is possible that the review could evolve into another set of reforms as was the case in 2009. The government is also committed to a minor injury treatment protocol, towing regulations and changes to the definition of catastrophic impairment.
We shall see what transpires in the months ahead.
However, the government has not abandoned their rate reduction strategy. That might mean additional reforms may be on the way and that the timeframe for achieving the target will need to be extended. The report on FSCO's Three Year Review has not been released The review was initiated in 2014 and one must assume it was been completed by now. It is possible that the review could evolve into another set of reforms as was the case in 2009. The government is also committed to a minor injury treatment protocol, towing regulations and changes to the definition of catastrophic impairment.
We shall see what transpires in the months ahead.
No comments:
Post a Comment