Opening Statement to the Northwest Territories Legislative Assembly Standing Committee on Accountability and Oversight

Workers' Compensation Board of the Northwest Territories and Nunavut

28 June 2006

Sheila Fraser, FCA
Auditor General of Canada

Mr. Chair, thank you for the opportunity to discuss my Report on the Workers' Compensation Board of the Northwest Territories and Nunavut. I am accompanied by Mr. Andrew Lennox, Assistant Auditor General, and Mr. Roger Simpson, Principal, who is responsible for this audit.

At the request of this Assembly and with the concurrence of the Nunavut Legislative Assembly, we examined whether the Workers' Compensation Board of the Northwest Territories and Nunavut complies with legislation and with the policies of its Governance Council in the way it processes compensation claims by injured workers.

We also looked at how appeals of its decisions on claims are managed and resolved.

We examined how the Board is governed, focussing on how the Governance Council oversees the Board's direction and management.

We did not look at the Board's other activities such as its levies of assessments on employers, its inspections and other accident prevention services, and its investment activities.

The Board is an important public institution. Like most workers' compensation boards, it is unlikely to satisfy both workers and employers in all cases, but it needs to have the confidence of the community. In the future, it will need to deal with the increased activity expected as a result of growing oil and gas development and mining in the North.

In almost all cases from 2005 that we examined, we found that the Board complied with the applicable legislation and policies in processing claims by injured workers. However, a small number of claims have remained unresolved for a number of years, mostly due to differences over medical or policy issues. Their number may be small, but these cases are costly in terms of negative publicity, staff time, appeals expenses, legal fees, and especially the psychological toll on claimants. I encourage the Board to find better ways of resolving differences of opinion on complex issues.

The Committee may wish to ask the Board what steps it plans to minimize the number of unresolved claims in the future.

While the Board has made some recent improvements to its procedures, it has not been clear enough in its communications with claimants. It needs to do a better job of explaining its rules, procedures, and—above all—its limitations. The people affected should not have to wonder how the Board arrives at its decisions and what the decisions mean. This lack of clarity has contributed to unrealistic expectations and frustration among claimants.

It might be of interest to the Committee to hear from the Board how it plans to improve communications in order to reduce claimants' frustrations and how it will monitor its performance in this area.

We found that the Governance Council lacks capacity in certain technical areas. The current appointment process does not clearly specify the technical competencies an ideal candidate would possess—information that could help to ensure that individuals with the needed skills are selected from the public and from employee and employer groups. We also note that at present, Council members are not provided with adequate training to strengthen technical capacity.

The Committee may wish to ask the Governance Council how it plans to strengthen the Council's capacity in technical areas, and within what time frame.

Policy consultation with stakeholders has been inadequate in the past. The Council did recognize this, and the Board adopted a new approach to policy consultation in December 2005, which it currently is implementing on a trial basis.

Perhaps the Board and the Council could indicate how soon they will be able to say whether this new approach to consultation is effective.

We note in our report that the Governance Council does not demonstrate sufficient independence. It does not regularly obtain input on policy issues directly from stakeholders, particularly on controversial matters such as pain disorders and pre-existing conditions.

The Committee may wish to ask the Council how it plans to obtain input on controversial matters, and from which stakeholders.

Thank you Mr. Chairman. We would be glad to answer any questions that the Members may have.