TORONTO -- Created 43 years ago to help buyers of new construction homes, the Ontario government now says Tarion Warranty Corp. has become an agency that favours builders over consumers and has subsequently asked the company’s CEO to step down.
"I want to be clear, this is going to be a major overhaul," the Minister of Government and Consumer Services Lisa Thompson said Thursday.
When a new home buyer had a problem, they could go to Tarion for help, but the auditor general’s report released Wednesday slammed the home warranty program, saying it was spending millions of dollars on bonuses for its executives but not paying attention to disputes raised by new homeowners.
Between 2014 and 2018, almost 9,700 requests to Tarion for help from consumers were dismissed because of restrictive deadlines.
"We have heard loud and clear that real, meaningful change is needed to the way we administer and enforce and Ontario’s new home warranties and protection program," Minister Thompson said.
In proposed legislation released at Queen’s Park on Thursday, the government said it wants to restore consumer trust, reduce the influence of builders, make the program consumer-focused and enhance the dispute resolution process.
The minister also said the board would no longer be stacked with builders and developers.
"The proportion of new home builders and vendors on the board will be limited to no more than one third," Thompson said.
The NDP Critic for Consumer Protection issues, Tom Rakocevic, said that the changes are a long time coming. "Buying a new home should be a dream and not a nightmare and new home buyers need existing warranties to be honoured fairly," Rakocevic said.
The government had previously announced that it would establish a separate regulator for new homebuilders -- something that has been handled by Tarion, and which critics have called a conflict of interest.
With files from the Canadian Press.
