It’s hard to imagine a more serious critique of a government agency than the report released last week on Tarion “Warranty” Corporation by the Auditor-General of Ontario (link below, Oct. 30, 2019).
The report came as no surprise to consumers who’ve been hammering at the doors of Queen’s Park for over a decade with complaints about exactly the kind of corporate wrong-doing the report documented.
Just a few of the revelations of wrong-doing are:
– Tarion has given disproportionate influence to builders and their industry lobby group on its board and its policy-making;
– Tarion makes its own regulations without sufficient oversight by government;
– Tarion’s senior management was rewarded financially for minimizing financial aid paid to homeowners;
– Their legal department tried to obtain internal confidential information to use against consumers in court;
– Tarion doesn’t do enough due diligence to ensure builders have the financial stability to be licensed and build;
– Tarion keeps secret information on builder’s track records;
– 65% of the time between 2014-2018 builders should have fixed the defects under the warranty, but did not. (pg. 7, Auditor’s report).
– Tarion can’t call itself a “warranty” corporation because they don’t provide a warranty.
Added to this scathing critique of Tarion’s policies is the equally hard-hitting review of Tarion in 2017 by a seasoned judge and Deloitte Consultants, which recommended removing Tarion’s monopoly, opening the field to competition, a separate regulator for builders, and a total of 37 recommendations. Nothing meaningful has been done.
Many consumers have been sabre-rattled into silence by Tarion and some of their builders and lawyers over the years, warned not to use words like “corruption” or “collusion” regarding Tarion’s business practices, warned to stop saying there are loopholes in Tarion’s “warranty”, threatened with defamation lawsuits, spent time in jail for refusing to pay Tarion’s legal fees, (yes, jail), and some sternly admonished by the Chair of the board not to be “disruptive” at its Annual Meetings (see 2015).
Even a quick reading of the Auditor-General’s report shows Tarion has reason to muzzle its critics, block them on social media, and prevent them from speaking out publicly.
Tarion’s laizzez-faire model of oversight was praised by a former Chair of Tarion, (in a 05/15/15 article in the Ottawa Citizen) stating the oversight model “keeps the government’s nose out of doing things”.
Yes, no kidding.
Tarion was given a public trust mandate in 1976, a monopoly to protect consumers and regulate builders. They have clearly too often failed in both of these duties to the public.
Consumers feel they’ve been sent on a fool’s errand by the governing Liberals and PC’s for over a decade, some have lost their life savings and endured family hardships trying to get construction defects fixed in their new homes. This agency set up to protect us has too often failed in its mandate, and been successful in covering it up.
What makes disturbing reading is the “Tarion agrees and accepts” text after each of the serious critiques of their activities. Where has the Tarion CEO been for 10 years? Where have the in-house lawyers been, with their professional code of ethics to act in the public interest?
The Tarion mea culpas seem fake and hollow. As does the well-meaning promise of the Minister of Consumer Services who welcomes the Auditor’s report, vowing to “work together” with Tarion, and better educate consumers.
What needs to be done?
1) The Tarion board and CEO should be asked to step down. They’ve lost credibility. They don’t deserve our trust any more.
2) Our legislators need to bring new legislation to protect consumers against shoddy builders, not builders against consumers.
3) Legislation needs to end Tarion’s monopoly. Other warranty providers will refuse to license bad builders due to their responsibility to manage their own risk. Let Tarion continue to license as many bad apples as they want, let’s see how that works out for them. They may fall on their own sword.
The response from the current PC government to the Auditor’s report is timid. Premier Ford himself has said not one single word. The minister says consumers need to be better educated, a page right out of the builder lobbyist’s and Tarion playbook. Tarion has seen the light, we’re meant to believe, and vows to “work with” the government to fix itself.
Premier Ford’s much-publicized plan in early 2019 to “partner” with the building industry to build more homes, faster, and cut red tape, seems directly opposed to any serious effort to rein in this rogue monopoly and make it accountable and transparent.
Tarion has failed in its responsibility to the public, while too often taking advantage of vulnerable consumers. We’re being asked to trust them. Again. We’re not buying it. They’ve been selling us a product they don’t have, and masqueraded as consumer protectors while protecting builders, their monopoly, and their pocketbooks.
The message to the public is we’re working with Tarion, and Tarion with the Ministry. Which is what brought us this policy failing in the first place.
This is a political problem, and only our governing MPPS can fix it. Have they already made promises to the building industry and its puppet? The refrain of we agree and we’ll do better is not credible. Too little, too late. Beware of the crocodile who sheds a tear before devouring his prey. Drain the swamp.
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http://www.auditor.on.ca/en/content/specialreports/specialreports/Tarion_en.pdf
CONSUMERS' REFORM TARION 