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Tories hide cost of pre-election advertising campaign

Author: John Carpay 2004/11/14
Will Alberta taxpayers find out - before they vote on Monday - how much of their money was spent to sell them on the government's new car insurance system

This past September and October - just before the election was called - the Alberta government spent hundreds of thousands of tax dollars to buy radio ads and large newspaper ads to promote its new car insurance system. The government also printed and mailed out brochures across Alberta.

On October 4 the Canadian Taxpayers Federation (CTF) asked Alberta Finance how much taxpayers' money was being spent to promote this new car insurance system. Alberta Finance refused to provide this information, saying the CTF might "use it against the government." The same request was made again on November 9, but the costs of this campaign - estimated to exceed $300,000 - remain hidden from taxpayers.

The government promises this new car insurance system will save Albertans $200 million per year in premiums. But the government collects $191 million per year from Albertans through a 3% hidden sales tax on insurance. Why not just scrap the 3% hidden sales tax, and save taxpayers the cost of a whole new bureaucracy to implement and administer this new system The new system promises a 5% reduction in premiums for most drivers. But that 5% reduction applies only to mandatory insurance coverage for third party liability - not to other kinds of insurance like collision, glass, replacement use, etc. Many Alberta drivers would save more money if the government scrapped its 3% hidden sales tax on insurance premiums.

Some people criticize the new system as unworkable and impractical. Others point to the fact that dozens of companies compete for Albertans' insurance business, and say that the market will correct itself and insurance costs will come down on their own. Some have said that the new system reduces the incentive to improve one's driving, because it lowers premiums for bad and inexperienced drivers. Others say it's unfair to limit damages for pain and suffering to $4,000 for injuries deemed "minor." Some say we should impose a government monopoly on car insurance, as other provinces have done. Others say the new system is wonderful and fair.

There are many opinions about this new system. Our democracy allows for free and vigourous debate on this election issue. But our democracy is distorted when tax dollars are spent to promote one particular viewpoint: the Tory viewpoint that the new system is fair.

The government's promotion campaign states that "your insurance company will automatically amend your policy if you are entitled to a premium reduction under the new system." If this is the case, why spend thousands on radio and newspaper ads claiming that the new system is fair

The CTF submitted a formal Freedom of Information request about the costs of this promotion campaign on October 5, and was promised it would get the information by November 5. But on November 8, the CTF received a letter from the Alberta Finance Freedom of Information office stating that the advertising costs would not be made available until December 6 - after the provincial election. That smells like political interference.

Taxpayers have every right to know how much of their money was spent to promote the government's new car insurance system. Whether or not we find out before November 22 remains to be seen.


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Franco Terrazzano
Federal Director at
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Federation

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