The Insurance Corp. of B.C. has announced that its managers will only receive bonuses if profit targets are met. The backdown follows a wave of public indignation after the company shelled out bonuses worth $17 million in 2010, then turned around and requested an 11 per cent premium hike.

However, while the gesture is a step in the right direction, the whole idea of gratuities in Crown corporations needs a rethink.

By law, ICBC holds a monopoly over basic auto insurance. How much acumen does it take to turn a profit when you're the only game in town?

That doesn't mean the agency lacks management or direction. No doubt there are hard-working men and women who take their jobs seriously.

But ICBC's bottom line owes little to those factors. In practice, the decisions that determine profit or loss are made at the legislative building in Victoria. And it's been that way for some time.

In the mid-1990s, ICBC almost cratered. Over just a few years, the cost of insuring motorists more than doubled. But the only solution company managers could offer was to raise rates. In 10 years, basic auto insurance premiums climbed a staggering 150 per cent.

That came to an end when the NDP government of the day stepped in. Using the power of legislation, Glen Clark's administration set out to reduce accident levels.

Driver education and licensing programs were strengthened to cut down the carnage among young motorists. Fines for a wide range of speeding infractions were hiked, in some cases by 100 per cent or more.

Photo radar was expanded, and red-light cameras were introduced at high-volume intersections. The result was a dramatic turnaround. The number of collisions fell by half in just 24 months. And ICBC went from a loss of $140 million in 1996 to a net gain the following year. Since then, the company has run up profits totaling $3.4 billion.

Gordon Campbell's B.C. Liberals took these policies a step further. In 2003, the B.C. Utilities Commission was given authority to regulate basic auto premiums. And in 2010, the province targeted drunk drivers with a get-tough program of fines and driving suspensions.

So where does that leave us? ICBC no longer decides pricing. The utilities commission does that.

Nor does the company control its main cost driver - accident rates. The provincial government has taken over that responsibility. Add in the monopoly factor, and the idea of an autonomous corporation disappears. In effect, ICBC is little more than an operating arm of the provincial government.

So why are managers paid whopping bonuses? The heavy lifting is being done elsewhere.

ICBC isn't the only Crown agency where remuneration policies are at odds with reality. The B.C. Lottery Corporation has about 867 employees. Ninety of them make $100,000 or more when bonuses and gratuities are included. Yet government lotteries are a licence to print money. This "corporation" is virtually guaranteed a profit. So why are bonuses being handed out?

Then there is Community Living B.C. This sham of a corporation delivers services to the disabled. The "company" is nothing more than a government ministry in disguise. It was set up to shelter politicians from public anger over the poor living conditions of many handicapped clients. Yet, disgracefully, this corporation also gave bonuses to management, until the minister responsible called a halt last year.

We could go on, but the point is clear. Agencies that deliver a social service, or that administer a Crown monopoly, are in no meaningful sense business entities.

Blather about profits and bonuses and corporate governance is just that - blather. It's time to end this deceitful practice. If that leaves ICBC managers with some unspent cash, fine. Let them cut premiums instead.