Canada’s Saskatchewan Workers’ Compensation Board (WCB) reported a drop in the provincial workplace injury rate and improved financial performance in its 2004 annual report tabled recently in the Legislature.
Report statistics show the province’s injury rate has declined 11.1 per cent, from a 20-year high of 4.95 per 100 workers in 2002 to 4.40 per 100 workers at the end of 2004.
“The focus on workplace safety has produced dramatic results in a short period of time,” said John Solomon, WCB chairman. “The success in reducing the injury rate can be attributed to the diligent efforts of workers and employers in implementing and supporting workplace injury prevention programs.”
The WCB is Saskatchewan Labour’s partner in WorkSafe Saskatchewan, whose emphasis is on workplace injury prevention. It is also a founding partner in Safe Saskatchewan, a public and private sector coalition led by the Saskatchewan Safety Council for prevention of unintentional injuries of all kinds. The WCB’s strategic objective is to reduce the provincial injury rate to 4.00% by the end of 2007.
Year-end results also show the WCB with an operating surplus of $11.7 million, an improvement of $19.6 million compared to 2003’s $7.9 million operating shortfall. This surplus follows two years of accumulated shortfalls totaling $ 101.3 million.
The improvement in operating results is attributed to increased premium revenue and continued positive injury prevention and case management results.
“A 2004 premium increase combined with growth in reported payrolls have increased premium revenue by $43.4 million,” said Peter Federko, WCB CEO. “The decrease in the injury rate means approximately 550 fewer new time loss claims and the 1.7 day decrease in time loss claim durations follows a downward trend started in 2002.”
The operating surplus is applied against the deficit in the Injury Fund, reducing it from $49.7 million to $38.0 million. After applying other reserves, the net deficit is reduced to $9.5 million.
“Despite this net deficit position, the WCB remains virtually fully funded,” said Solomon. “The WCB’s ability to meet its legislated and administrative obligations have never been in jeopardy, and today we are closer to our objective of restoring the Injury Fund and reserves to funding policy levels.”
According to new Canadian Institute of Chartered Accountants (CICA) principles, workers’ comp boards are no longer permitted to report smoothed investment income over five years. Only income received and realized during the reporting year can be recorded as investment income. This change reduced the WCB’s investment income by $3.5 million.
The Statement of Financial position must record investments at their market value at Dec. 31 of the reporting year. This adjustment from cost to market value is recorded in the Accumulated Market Value Adjustments (AMVA) fund.
“Stakeholders must be cautious about forming their views of these adjustments, considering market values’ extreme volatility,” warned Federko. “The $62 million included in the WCB’s AMVA is simply not available for funding purposes.”
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