1980 Legislative Session: 2nd Session, 32nd Parliament

HANSARD

The following electronic version is for informational purposes only.

The printed version remains the official version.

Official Report of

DEBATES OF THE LEGISLATIVE ASSEMBLY

(Hansard)

FRIDAY, JUNE 20, 1980

Morning Sitting

[ Page

2951 ]

CONTENTS

Routine Proceedings

Residential Tenancy Amendment Act, 1980 (Bill 21). Hon. Mr. Nielsen.

Report and third reading –– 2951

Fort Nelson Indian Reserve Minerals Revenue Sharing Act (Bill 22). Second reading.

Hon. Mr. Williams –– 2951

Mr. Levi –– 2953

Hon. Mr. Williams –– 2953

Home Owner Grant Act (Bill 31). Second reading.

Hon. Mr. Vander Zalm –– 2953

Mr. Barber –– 2954

Hon. Mr. Williams –– 2955

Credit Union Amendment Act, 1980 (Bill 12). Committee stage.

Report and third reading –– 2955

Consumer Protection Amendment Act, 1980 (Bill 14). Committee stage.

Report and third reading –– 2955

Consumer and Corporate Affairs Statutes Amendment Act, 1980 (Bill 16). Committee stage.

section 2.

Mr. Levi –– 2956

Hon. Mr. Nielsen –– 2956

section 23.

Mr. Levi –– 2956

Hon. Mr. Nielsen –– 2956

Report and third reading –– 2956

School Amendment Act, 1980 (Bill 20). Committee stage.

section 1.

Hon. Mr. Smith –– 2956

Fire Services Amendment Act, 1980 (Bill 25). Second reading.

Hon. Mr. Williams –– 2957

Mr. Macdonald –– 2957

Hon. Mr. Williams –– 2957

Liquor Control and Licensing Amendment Act, 1980 (Bill 18). Second reading.

Hon. Mr. Nielsen –– 2957

Mr. Macdonald –– 2958

Mr. Levi –– 2961

Appendix –– 2966

FRIDAY, JUNE 20, 1980

The House met at 10 a.m.

[Mr. Davidson in the chair.]

Prayers.

MR. HALL:

I'd like the House to welcome to Victoria and to the precincts this

morning some visitors from Surrey. In the members' gallery this morning

is Mrs. Doreen Nelson with Barry and Kim Nelson.

Orders of the Day

HON. MR. GARDOM: I ask for leave to proceed to public bills and orders.

Leave granted.

HON. MR. GARDOM: I call report on Bill 21.

RESIDENTIAL TENANCY

AMENDMENT ACT, 1980

DEPUTY SPEAKER: When shall the bill be read a third time?

HON. MR. NIELSEN: Now, Mr. Speaker.

Motion approved on the following division:

YEAS — 42

Waterland

Nielsen

Chabot

McClelland

Rogers

Smith

Heinrich

Vander Zalm

Hewitt

Brummet

Ree

Wolfe

McCarthy

Williams

Gardom

Bennett

Curtis

Phillips

Fraser

Mair

Kempf

Davis

Strachan

Mussallem

Lorimer

Hall

Nicolson

Cocke

Dailly

King

Howard

Macdonald

Levi

Gabelmann

D'Arcy

Lockstead

Brown

Barber

Wallace

Hanson

Jordan

Hyndman

NAYS — I

Mitchell

Bill 21 read a third time and passed.

Division ordered to be recorded in the Journals of the House.

HON. MR. GARDOM: Second reading of Bill 22, Mr. Speaker.

FORT NELSON INDIAN RESERVE

MINERALS REVENUE SHARING ACT

HON. MR. WILLIAMS: Mr. Speaker, in rising to move second reading of

Bill 22, I would like you and the members of the House to know that companion

legislation, required for the full implementation of the agreement between the

Fort Nelson Indian band, the province of British Columbia and the government

of Canada, is being undertaken during these next few days by the governments

of this province and Canada. I understood from the Hon. John Munro, Minister

of Indian Affairs and Northern Development, that it was expected that this bill,

which is before the House in Ottawa, would be called for debate today. Because

of some procedural problems associated with the order of their business, it

is expected that that debate will commence early next week.

think it important when considering this bill to reflect upon some of

the history which is associated with it, in order that there may be a

clear understanding of the reason for the agreement and the legislation

which is before this House today. The setting aside of lands for the

use and benefit of the Indians of British Columbia began during

colonial days, prior to British Columbia becoming a part of Canada. It

continues to the present, although most of the province's 192 bands

have had the use of their reserves for at least half a century.

The

Fort Nelson band of the Slave Indians, however, has occupied reserve

lands in this province only since 1961. The reasons for this can be

traced back to 1899, when Treaty 8 was signed between Canada and a

number of the bands that occupied lands in the northern part of this

province, The nomadic Fort Nelson band was not an immediate signatory

to the treaty. Apparently the records indicate that representatives of

the band could not be located by the federal treaty commissioners.

When

the Fort Nelson band did accept Treaty 8 in 1910, the band nonetheless

withheld the selection of reserve lands, even though the treaty

provided for the establishment of such reserves. It was a part of the

treaty that lands could be selected at any time following the

acceptance of the treaty, and there was no pressure on the band to act

at that particular time.

Treaty 8 is a matter which was

concluded between the federal government and the Indian people. The

province was not consulted with respect to the treaty, nor was it asked

to share in any of the costs of its implementation. Subsequently,

however, in order to fulfill its treaty obligations, the federal

government sought provincial Crown lands for Indian reserve purposes,

and

article 13 of the terms of union by which this province joined

Confederation required the new province to transfer tracts of land to

Canada from time to time for the use and benefit of Indian people.

Subsequent

to Confederation serious disagreements arose between British Columbia

and Canada over the size of Indian reserves to be created, and as a

consequence in 1912 the two governments agreed to the establishment of

a commission which would attempt to settle the Indian land question

once and for all. I think subsequent events have shown how difficult

that task was. The commission conducted its work from 1913 to 1916,

during the course of which many interim reports were issued. The

question of reserve lands in the Treaty 8 area was dealt with in

interim report number 91, which recommended that the province provide

lands in the treaty area when requested to do so by Canada. In the

meantime, however, and pending the establishment of those reserves,

there were to be no restrictions on land use or alienation by the

province. Whenever the Indian people were

[ Page 2952 ]

ready, they would be permitted to select the lands which they wished to have set aside as their reserves.

The

Fort Nelson Indian band made its land selection known between the years

1952 and 1959. Some of the lands selected by the Fort Nelson band had,

prior to their selection, alienations of interest in those lands,

principally in the form of natural gas exploration leases. As a

consequence, when the reserve lands were transferred to Canada for the

band in November 1961 the province was obliged to retain the

undersurface rights in order to fulfill its obligations under the

alienations which had been undertaken — alienations, as I have

indicated, which were permissible notwithstanding interim report 99 of

the royal commission.

The retention of mineral rights,

including rights to natural gas, petroleum and coal, was disputed by

the band at that time. The matter was one of continuing discussions

from time to time between the governments of Canada and British

Columbia and the Fort Nelson band. Notwithstanding those discussions,

no resolution was achieved.

The dispute was escalated when

natural gas production began from pools located in part beneath the

Fort Nelson Reserve No. 2, which is the largest of the band's reserves.

I'd say that there are now two known natural gas pools which underlie

this reserve in whole or in part. The Roger field is wholly beneath the

reserve land while, according to petroleum technical estimates, only

7.44 percent of the Clarke Lake field lies beneath the geographical

limits of reserve No. 2.

The anomalous situation in which

the Fort Nelson band found itself arises from the fact that when the

majority of Indian reserves, some created prior to Confederation, were

formally transferred to Canada in trust for the Indians in 1938, there

was no reservation of under-surface rights to the province with the

exception of gold and silver, which by common law remained with the

Crown.

In 1943 the difficulties which this reservation had

produced resulted in an agreement between Canada and British Columbia —

the Indian Reserves Mineral Resources Agreement — which provided for

the equal division of mining revenues between the province and the

Indian bands being concluded. That agreement omitted reference to coal,

petroleum and natural gas, which left open the question of the

ownership of these resources. The province continued to deal with those

resources as if ownership remained in the province. Canada, in part,

and the Fort Nelson band in particular, continued to take the position

that the resources belonged to the band.

This question of

ownership and the disagreement arising therefrom continued from the

late 1950s onward. In 1976 the provincial government, for the first

time, gave serious consideration to the arguments which were being

presented by the band and, as a consequence, late in that year and

early in 1977 negotiations were undertaken in a serious effort to

resolve this long-standing disagreement.

Those negotiations continued through until January 7 of this year, when I had

the pleasure of attending at Fort Nelson with the Hon. Jake Epp, who

was then Minister of Indian Affairs and Northern Development for Canada, for

the purpose of signing the agreement that had resulted from three full years

of intensive but responsible negotiations. During this period and at the first

stages of these negotiations, the Indian band, represented by highly qualified

negotiators, dealt directly with the provincial government and their officials,

and when substantial agreement had been achieved, the matter was then addressed

Development, the Minister of Justice and their officials became involved. Following

was finally achieved.

The

agreement itself, while complex, is, in fact, relatively

straightforward. The complexity arises, Mr. Speaker, almost entirely

because of the fact that the petroleum and natural gas industry — the

nature of the resource — requires considerable definition and the

application of formulas with respect to values. The details are unique,

I think, to that industry. Taken as a whole, the agreement provides

that the revenues from natural gas production from the fields which

underlie the reserve are to be shared equally between the Fort Nelson

Indian band and the province of British Columbia. The ownership,

administration and the responsibility for management of the resource

remain with the province.

The revenues are determined by

calculating the volume of gas removed from the fields under the

reserve. A complicated pricing formula is applied to that volume of

gas, which takes into account every change in natural gas price and

every change involved in the costs incurred in the production,

processing and the transportation of that natural gas. The formula also

takes into account the fact that some natural gas produced in this

province is used domestically at one price level and some is exported

at another price level. But the distinction between these two prices

and the volumes of gas which can be determined or deemed to be

available for export have been identified. That significant factor is

taken into account in the pricing formula to ensure that the revenues,

which are shared with the Fort Nelson Indian band, are in every way

fair and equitable, based upon the two-price policy presently in

existence.

Further than that, since the domestic price

remains to a large extent under the control of the provincial

government, and therefore it might be assumed that the manipulation of

that price could be to the disadvantage of the Fort Nelson Indian band,

provision has been made so that as the price of the product changes,

both here and elsewhere, such changes are reflected in the formula,

notwithstanding the fact that the government of British Columbia may

maintain domestic natural gas prices at a level below the cost of

production, which is the case in this province today. In effect, the

share of revenues available to the band is in every sense equal to the

share available to the province and to the people of this province,

might point out one other factor which arose during the latter stages

of the negotiations, which caused this province some concern. We found

Prophet River band were at one time members of the Fort Nelson band.

They formally separated in 1974. Since the benefits under this

agreement arose prior to that date, it was necessary to ensure that the

members now in the Prophet River band would enjoy the benefits rightly

due to them. This benefit has been determined by the federal

government. The agreement provides that moneys are set aside for the

Prophet River band.

The moneys which flow to the Fort Nelson

Indian band are large. For the period from 1961, when gas production

first commenced from the Clarke Lake field, until January 1, 1977, the

effective operating date of the pricing formula under this agreement,

calculations were made and on the signing of the agreement a lump-sum

payment of $4.5 million was passed to the Fort Nelson Indian band. Up

to the end

[ Page 2953 ]

1979, under the agreement, the band's share of gas production revenues

exceeded $7 million. Depending upon the season of the year, revenues

flowing to the Fort Nelson Indian band range between $200,000 and

$500,000 per month.

I wish you to know, Mr. Speaker, that

the government of British Columbia and the leaders of the Fort Nelson

Indian band were concerned about the consequences which might befall an

Indian band when suddenly presented with this treasury — riches of this

magnitude. Therefore, during the discussions with the government of

Canada in the final stages of negotiation, the question of the

management and administration of those moneys was raised by British

Columbia. We had discussions with the Indian band as to what management

technique should be employed with such large sums of money, and also

the extent to which the band would employ wise counsel in the

expenditure of those vast sums.

I am pleased to say that the

funds which are for the benefit of Indian bands, recognized this

special case. Discussions are going on between the Fort Nelson Indian

band and the federal government which are designed to ensure that

modern practices of financial management are employed in respect of

these moneys which will be paid to Canada for the benefit of the Fort

Nelson Indian band.

The Indian band itself has taken, I

believe, a most reasonable view with respect to the utilization of

these moneys. As the chief and the band councillors indicated to me in

my discussions with them, their needs are not great and they are not in

any rush to see the moneys flowing through to individual band members.

The

Fort Nelson Indian band is still today somewhat nomadic, in keeping

with its history. Their plans are, considering the amount of moneys

which are available to them, at this time most modest. They would like

some improved housing for the people on the reserve, they would like to

have a modern water system, and they would like to ensure that there

are facilities for the care of their elderly band members. That's about

all at the moment.

They are prepared to have these large

sums of money remain invested, managed and used over time for the

continued development and benefit of band members today and in the

are proposing to form a development corporation to seek the advice of

qualified persons, whether they be Indian or not, in the management of

that corporation, and they will seek to proceed cautiously in the use

of these moneys. This is a step in which we, as the government of

British Columbia, have no direct jurisdiction. But I assure you, Mr.

Speaker, that the government of British Columbia will continue to

monitor the activities of this band and provide it with whatever

assistance we are able to in ensuring that these funds are used

efficiently and wisely in the interests of that band.

would be anxious to hear what members of this assembly may have to say

with respect to this bill. If there are matters of principle which

should be answered by me in the course of this debate, I would be happy

so to do. The bill is very short, and it may be perhaps possible for

all those questions to be resolved to the satisfaction of members

during the course of this second reading debate. I now move second

reading of Bill 22, Mr. Speaker.

MR. LEVI: Mr.

Speaker, we are going to support the bill and we will deal with it in

committee. However, I just want to make one observation, because the

minister did make reference to the.... He didn't call it the

McKenna-McBride commission, but he was referring to that when he talked

about looking at the reserves and the reorganization of the reserves

back in 1912 to 1916. I think we should understand that this item is on

the agenda of the federal government. This is a federal government

initiative. Because the minister did make mention of the

McKenna-McBride commission, I would hope that — probably when we talk

about it in committee — it is time that perhaps the B.C. government

also had its own agenda and looked to the question of the

McKenna-McBride cutoff land problem, which is still very much

unresolved in this province.

The minister raised it. I

appreciate that we are dealing here with the few bands that are

involved in treaties. The rest of the people in this province are not.

But we should bear in mind that the initiative here came from the

federal government. This is a complementary piece of legislation to

enable that to take place. I would like to hear, perhaps later on, from

the minister just what he intends to do about the other matters that

are on the agenda of the Indian people,

HON. MR. WILLIAMS:

In closing this debate I would just say to the member that the question

of the fulfilment of the several recommendations of the McKenna-McBride

commission is one which is very much before the government, and I hope

to have the opportunity during this session to discuss at some length

with members of this House the steps which we have taken, which I don't

think are appropriate to this particular bill. Certainly the question

of cutoff lands is one which I'm prepared to deal with at whatever

length is deemed necessary. I move second reading, Mr. Speaker.

Motion approved unanimously on a division.

Division ordered to be recorded in the Journals of the House.

HON. MR. WATERLAND: Mr. Speaker, I ask leave to introduce guests.

Leave granted.

HON. MR. WATERLAND:

I am very happy that my wife, Donnie, has joined us in the gallery

today, and I'm particularly happy that my daughter, Terry Brenna, is

here visiting from Saskatoon. Would the House please welcome them.

HON. MR. WILLIAMS:

Mr. Speaker, I move that Bill 22 be referred to a Committee of the

Whole House for consideration at the next sitting of the House after

today.

Motion approved.

HON. MR. GARDOM: Second reading of Bill 31, Mr. Speaker.

HOME OWNER GRANT ACT

HON. MR. VANDER ZALM: Mr. Speaker, it gives me great pleasure to introduce second reading of Bill 31, a bill to

[ Page 2954 ]

introduce

a new homeowner grant. Applicants for the provincial homeowner grant

will benefit from the completely rewritten homeowner grant. The

previous act was poorly organized and contained many inconsistencies

and ambiguities which made it most difficult to administer in a fair

and consistent manner. The new Home Owner Grant Act sets out clear

definitions and will enable the collectors to administer the act in a

consistent fashion and thus reduce the dissatisfaction on the part of

some people who've become concerned with the more or less ad hoc

decisions.

Ambiguous

definitions in the old legislation have

led to inconsistent decisions and rulings being made between

jurisdictions. We have tried in this new legislation to provide precise

definitions for those items that cause concern. The new act for the

first time extends eligibility for the grant to long-term lease

holders, including 99-year lease owners. If an eligible apartment is

leased under a lease registered in the land titles office and the lease

has a term of at least 99 years, the Lieutenant-Governor-in-Council is

authorized to designate the apartment building for eligibility

purposes. While most of the act comes into force and effect on January

1, 1981, provisions regarding the assignment of 99-year leases become

effective January 1, 1980, so as to apply to the current year.

The

new act will also increase the grant by $50, from $580 to $630 per year

for persons 65 years of age and over and for eligible handicapped

persons. The $50 grant increase will also come into force retroactive

to January 1, 1980. The remainder of the act will come into force

effective January 1, 1981.

The act also extends the

principle of local autonomy by permitting the local municipal collector

to determine whether or not the applicant meets the criteria for an

extension of time. The collector may grant an extension of time where a

person was eligible for the grant but neglected, inadvertently or

otherwise, to apply. Previously, the Ministry of Municipal Affairs

determined whether or not an applicant qualified. The rewritten act

also removes the potential for abuse.

The act provides that

no more than one grant shall be made with respect to any house or

eligible apartment, and no individual is eligible for more than one

grant. This rule is extended to an owner and his spouse, so that a man

and wife cannot together claim two grants. Where the collector

determines that the owner has received a grant to which he is not

entitled, that amount becomes a debt on the tax roll against that

owner's property. An applicant who knowingly or recklessly furnishes

false information in the course of making an application for the grant

is liable to a fine of up to $2,000.

The purpose of the

provincial homeowner grant is to reduce real property tax levies by

local government on residential homeowners. The act encourages home

ownership and, along with the provincial revenue-sharing program,

reduces the real property tax burden for local taxpayers. Since 1975,

Mr. Speaker, the homeowner grant has almost doubled — certainly more

than doubled in the case of those 65 years of age and over and the

handicapped.

Mr. Speaker, I move second reading.

MR. BARBER:

Needless to say, the official opposition will be supporting this bill.

We're especially pleased that after some years' struggle the government

has now acknowledged the merit of the principle put forward by this

side of the House for at least four years in a row: that owners of

99-year leases are, in fact, homeowners in every important sense, and

are thereby entitled by right — and today by law to the homeowner grant.

I may make a personal observation, one does note what a difference a

year makes. I recall a year ago making this same speech at the same

time and hearing claims from unnamed persons opposite that owners of

99-year leases were not homeowners at all.

MRS. WALLACE: Who was that?

MR. BARBER: I can't remember who it was.

MR. LORIMER: From which side of the House?

MR. BARBER:

On that side of the House. They said that therefore they were not

entitled and never should be, and the usual intimations were made of

strange socialist attitudes promoting lease holders as homeowners, and

therefore we should keep our mouths shut. Well, fortunately a year has

made a considerable difference, and I'm very pleased that the minister

who just spoke acknowledges the difference and now accepts the argument.

MR. LEA: The wrong Bill is Premier.

MR. BARBER: I guess he wants to be Premier more than ever. Nonetheless I'm very glad to see this particular provision here.

regard again to 99-year leaseholds, I would like, if I may, to identify

certain persons who are in fact significantly responsible for the

inclusion of this new and long overdue principle. In 1975 David

Anderson, the former second member for Victoria, as the result of the

general election, turned over a file to me; he turned over the file of

his work with Villa Royale, a 99-year leasehold in the capital city.

Mr. Anderson was able to demonstrate the very considerable work he had

done in the last six months of 1975 — and as it turned out the last six

months of his term in office — putting the case that 99-year lease

holders were, in fact, homeowners like any other. David Anderson, I

think, deserves credit for originally raising the public debate on this

issue and for originally arguing for an extension of the homeowner

grant. So I'd like to recognize David this morning and give him full

credit for having done that five years ago.

I'd also like to

recognize people like Sharron Simpson, Shirley Rycroft, Harry Schallen,

Louis Lafonte and many others who, as public citizens and as leaders of

residents' groups in 99-year leaseholds across British Columbia and

particularly in Victoria and Vancouver, very actively helped put the

case for the establishment of this new principle which this morning

will be supported unanimously in the Legislature. Sharron, Shirley,

Harry, Louis and all the others have worked extraordinarily hard in the

last couple of years for this result, and I would once again like to

name and congratulate them for the excellent work they did in putting

forward the case, in shaping the argument and finally in winning the

debate that 99-year lease holders deserve the benefits of the homeowner

grant, as do all other authentic homeowners in British Columbia.

think Don Lidstone in the minister's office deserves some credit too;

I'm well aware that he was heavily involved in the ministry in

promoting the several drafts of this. I certainly had a number of

opportunities to talk with him in the last year about various formulae

and various administrative

[ Page 2955 ]

means

of allowing this to happen, and I congratulate Mr. Lidstone for his

excellent work on the minister's behalf in helping this go through the

bureaucracy.

Finally I'd like to congratulate John Taylor in

the Ministry of Municipal Affairs, who, once again as a senior public

servant, has been heavily involved, for at least two and a half years

since we first put the case to him, in determining what lawful

initiatives could take place. As the minister knows, as he and I

discussed on several occasions, and as the now Attorney-General (Hon.

Mr. Williams) knows — we discussed it before as well — it's a difficult

matter to designate precisely what constitutes a 99-year lease, and to

make sure that people don't cheat; to make sure that people, by a quick

redesignation of title, don't unfairly and unreasonably take advantage

of a grant to which they're not properly entitled.

This act

appears, by every test we can apply to it, to meet all of the

objections that were previously raised. So I'm glad that's happened

too, and I congratulate the several authors of it within the public

service.

In regard to the rest of the legislation, of

course, it is a sensible thing to amend the bill generally, by

introduction of a brand new one in this case, to make it

administratively more straightforward, clear and simple. That's a good

thing and people in local government who have brought the issue to my

attention are also pleased with these new changes because it makes

their job easier. As members of the public service in civic government

they welcome that kind of initiative because it's now, in a fashion,

less contentious and a lot more clear. That's a good thing, too. For

all those reasons, but especially because of the extension of the

principle that the homeowner grant shall now be paid to the owners of

99-year leases, the official opposition will be supporting the bill and

doing so gladly.

HON. MR. WILLIAMS: I'll be very

brief. The first member for Victoria raised a matter which I think

should be spoken about so that there will be no doubt as to the views

of this government and the opposition members with respect to this

proper extension of the homeowner grant to people who, by reason of the

way in which they regulate their affairs, enter into 99-year leases — a

significant financial commitment to their residence. I just wish to say

that the problem touched upon by the member, namely the possibility

that those skilled in conveyancing matters or corporate involvement

should not see this as an opportunity to gain a homeowner's grant in

circumstances which might be seen to be bona fide.... To do so may have

two results, both of them unfortunate. Firstly, those persons who have

regulated their affairs in such a way that they bona fide have

long-term leases by which they provide themselves with their home may

be affected; questions may be raised as to whether or not there is bona

fide in the way in which they have organized their affairs. Of course,

the other equally unfortunate consequence would be that the government

of the province would need to give further consideration to

adjustments, regulations, limitations and exceptions to this aspect of

this bill. I'm pleased to hear the first member for Victoria raise this

matter. I wish to make it abundantly clear that if there are attempts

on the part of individuals who are not bona fide 99-year lease holders

to gain access to the homeowner grant concept in this province, I will

not have the slightest hesitation in recommending to the government

that steps be taken to ensure that there is no abuse of this

legislation.

HON. MR. VANDER ZALM . Mr. Speaker, I move second reading.

Motion approved unanimously on a division.

Division ordered to be recorded in the Journals of the House.

Bill

31, Home Owner Grant Act, read a second time and referred to a

Committee of the Whole House for consideration at the next sitting of

the House after today.

HON. MR. GARDOM: Committee on Bill 12, Mr. Speaker.

CREDIT UNION AMENDMENT ACT, 1980

The House in committee on Bill 12; Mr. Strachan in the chair.

Sections 1 to 55 inclusive approved.

Title approved.

HON. MR. NIELSEN: Mr. Chairman, I move the committee rise and report the bill complete without amendment.

Motion approved.

The House resumed; Mr. Davidson in the chair.

Bill 12, Credit Union Amendment Act, 1980, read a third time and passed unanimously on a division.

Division ordered to be recorded in the Journals of the House.

HON. MR. GARDOM: Committee on Bill 14.

CONSUMER PROTECTION

AMENDMENT ACT, 1980

The House in committee on Bill 14; Mr. Strachan in the chair.

Sections 1 to 22 inclusive approved.

Title approved.

HON. MR. NIELSEN: Mr. Chairman, I move the committee rise and report the bill complete without amendment.

Motion approved.

The House resumed; Mr. Davidson in the chair.

Bill 14, Consumer Protection Amendment Act, 1980, reported complete without amendment, read a third time and passed.

HON. MR. GARDOM: Committee on Bill 16.

[ Page 2956 ]

CONSUMER AND CORPORATE AFFAIRS

STATUTES AMENDMENT ACT, 1980

The House in committee on Bill 16; Mr. Strachan in the chair.

Section 1 approved.

section 2.

MR. LEVI:

I just have a question to the minister. Why is this

section put in?

Surely the elements of disclosure in terms of partnerships and that

kind of thing are really quite desirable. As I see it, the information

required from applicants regarding their partnership for registration

as mortgage brokers is no longer considered relevant. Why isn't it

considered relevant? Surely there's an issue here of disclosure.

HON. MR. NIELSEN: I'm sorry. I was unable to hear the question from the member.

MR. LEVI:

The intent of the amendment is to no longer require information from

applicants regarding their partnership for registration. I'm talking

about the issue of disclosure in terms of any kind of business

arrangement. Why is it seen necessary not to require it? Surely the

business of having this kind of information is useful.

HON. MR. NIELSEN:

Mr. Chairman, there are two reasons. One is to facilitate the uniform

licensing process, but the information the member speaks of is

available through the companies registrar.

Section 2 approved.

section 3.

MR. LEVI:

I think this is referred to in the business as "the curbers amendment.

" Curbers are people who sell cars outside of the car lot. They do a

little curbing.

Interjection.

MR. LEVI: Do you find that offensive?

HON. MR. GARDOM: No, no. He made a joke.

MR. LEVI: He made a joke. Do I laugh now?

HON. MR. McCLELLAND: You have no sense of humour; you probably never laugh.

MR. LEVI: The idea is that anyone that sells more than four vehicles is covered by this. Does this include the motor homes as well?

HON. MR. NIELSEN: Yes.

MR. LEVI: Fine, thank you.

Sections 3 to 22 inclusive approved.

section 23.

MR. LEVI: Regarding sections 23 and 24 and the Vancouver Stock Exchange

Act, does the minister know of any mechanism that they have...? Would the

public governors who are appointed — there are two now — report back? Are they

in touch with the department in any way, or are they purely independent in that

sense? Their role is to took after the public good — or is it? If it is, how

does the government know what's going on if they're not reporting back?

Is there no reporting system?

HON. MR. NIELSEN:

No, there is no formal reporting system. The governors are independent

of direct contact with the government. There is liaison, but in an

informal way. There is no formal system of reporting.

Sections 24 and 25 approved.

Title approved.

HON. MR. NIELSEN: I move the committee rise and report the bill complete without amendment.

Motion approved.

The House resumed; Mr. Davidson in the chair.

Bill

16, Consumer and Corporate Affairs Statutes Amendment Act, reported

complete without amendment, read a third time and passed.

HON. MR. GARDOM: Committee on Bill 20, Mr. Speaker.

SCHOOL AMENDMENT ACT, 1980

The House in committee on Bill 20; Mr. Strachan in the chair.

section 1.

HON. MR. SMITH: Mr. Chairman, I move the amendment standing under my name on the order paper. [See Appendix.

Amendment approved.

Section 1 as amended approved.

HON. MR. SMITH:

I should have said that arising out of changes in the dates of trustees

taking office this amendment was necessitated and it may be that some

consequential further cleaning up of dates in the act will have to

follow by way of a statute amendment bill.

I move the committee rise and report the bill complete with amendment.

Motion approved.

The House resumed; Mr. Davidson in the chair.

DEPUTY SPEAKER: When shall the bill be considered as reported?

HON. MR. SMITH: Now, with leave.

Leave not granted.

[ Page 2957 ]

HON. MR. GARDOM: Second reading of Bill 25, Mr. Speaker.

FIRE SERVICES AMENDMENT ACT, 1980

HON. MR. WILLIAMS:

Mr. Speaker, this bill, while very short, is nonetheless one of

significance in this province. Following the publication of the

Keenleyside report in 1975, the recommendations in that report received

wide public exposure, and it was often referred to and used as a basis

for criticism of the organization of fire services in this province.

One of the recommendations made by Dr. Keenleyside was that the

National Fire Code should be adopted for British Columbia. Other

recommendations contained in that report have already been dealt with

by the government of British Columbia. The Fire Services Act which is

before you today for amendment contains significant changes made with

respect to the delivery of fire services in the province. This

amendment is to carry into effect the recommendation by Dr. Keenleyside

with respect to the National Fire Code.

I think it is

appropriate at this time to point out to the members that the matter of

fire protection is dealt with under two of our national codes. The

National Building Code, which is in effect throughout most of this

province, establishes the standard of fire safety for the construction

of new buildings and for the reconstruction of buildings, including

extensions, alterations and upgrading, to remove unacceptable fire

hazards. It ensures that buildings have proper exit and entry accesses,

that interior finishes have maximum flame-spread ratings, that

sprinkler systems and fire detection alarm systems are installed, and

that life safety systems are also installed in cases where they are

deemed necessary.

The National Fire Code applies to

buildings in use. It ensures that fire and life safety systems

installed under the National Building Code are maintained and will

perform as they were originally intended. In addition, the National

Fire Code establishes a standard for prevention, containment and

fighting of fires originating outside buildings, which may present a

hazard to the community, and sets standards for the transportation of

flammable and combustible liquids.

In the adoption of the

National Fire Code for use in this province, it is considered necessary

and desirable that certain significant adjustments be made to the

National Building Code which will meet the requirements of the various

areas of British Columbia and will accord with the Fire Services Act

and the changes in fire services which followed the adoption of that

legislation. This amendment which is before the House today will ensure

that in the adoption of the National Fire Code the fire commissioner

and members of his staff, under the Fire Services Act, will be able to

modify the national code to the extent that is required to suit the

needs of British Columbia.

Also significant in the

amendment, and included in the adaptation of the National Fire Code to

British Columbia's purposes, will be the provision of a right of

appeal, which we consider to be necessary in view of certain

inadequacies that we perceive in the appeal provisions in the national

code. I think it is important in the continuing adjustment of fire code

standards for the province, as the need for changes arises and changes

are made, that the system of appeal be improved.

Mr. Speaker, I move second reading.

MR. MACDONALD:

Mr. Speaker, I was glad to hear the Attorney-General pay some tribute

to Hugh Keenleyside in the course of his remarks. I am glad his report

has not been forgotten. I had almost forgotten it myself, but I

remember very well what an excellent report it was. The questions we

have on this particular bill we will ask in committee.

Interjection.

MR. MACDONALD: It's in report stage? It can't be.

will allow second reading to go through — without, I may say, calling a

division. Anybody else who calls one does so at his own risk.

[Laughter.] I already interrupted my breakfast this morning. Our

trenchant questions will be reserved for the committee stage of this

bill, after we have read it.

HON. MR. WILLIAMS: Mr.

Speaker, in closing this debate on second reading — and it has been an

enthusiastic debate [laughter] — I think it is only appropriate to have

it recorded that the Keenleyside report was commissioned when the

second member for Vancouver East was the Attorney-General of this

province. I think it is significant, having commissioned the report and

having given very careful consideration to it since it was published in

1975, that he should not know that all of the provisions and

recommendations of the report have now been adopted into law in this

province and that this is the final step. I am sure that between now

and committee stage the hon. member will have the opportunity to

refresh his memory.

I move second reading.

Motion approved unanimously on a division.

Division ordered to be recorded in the Journals of the House.

Bill

25, Fire Services Amendment Act, 1980, read a second time and referred

to a Committee of the Whole House for consideration at the next sitting

of the House after today.

DEPUTY SPEAKER: Hon.

members, there was some small confusion regarding Bill 20. I now ask

the Minister of Education: when will the bill be considered as reported?

HON. MR. SMITH: At the next sitting, Mr. Speaker.

HON. MR. GARDOM:

I call second reading of Bill 18, Liquor Control and Licensing

Amendment Act, 1980. If we conclude that one, we'll be moving to Bill 9.

LIQUOR CONTROL AND LICENSING

AMENDMENT ACT, 1980

HON. MR. NIELSEN: Mr. Speaker,

although these amendments to this act are primarily housekeeping, they

are very important to the administration of the Liquor Control and

Licensing Act. They can be highlighted under the categories of

confidentiality of files, obligations of licensees, selling of

preclearance or trafficking in preclearances, appeals, the right to

search for and seize liquor, and inspection of agents' warehouses.

Under the topic of confidentiality, one of the sections will provide the branch with guidelines with respect to confiden-

[ Page 2958 ]

tiality

of its files and records. At the present time there are no rules. The

branch and the employees of the branch are often faced with many

difficult decisions as to providing information and to whom it should

provide information, primarily from licensees, lawyers, accountants,

consultants, researchers, the media and the general public. By

establishing rules, we hope to ensure that relevant information will be

more accessible, and that sensitive, private or confidential

information will be available only to proper authorities.

The

obligations of persons who obtain special licences are also clarified

in these amendments. Every year about 45,000 persons obtain these

licences, and it has not been clear in the past that such licensees

would have the same obligations as a permanent licensee. Amendments

also define breweries, wineries and distilleries as licensees.

Mr.

Speaker, we have clarified the appeal procedures. In the past we found

considerable confusion on the part of persons holding licences as to

whether they should appeal to the Corporate and Financial Services

Commission or to the minister, and the amendment removes the confusion,

we hope.

Trafficking in preclearances is a problem addressed

by the amendments. The addition of a subsection clarifies that a

preclearance obtained by an applicant — presently this would be most

typical in an application for a neighbourhood public house or cabaret —

is not transferable without the approval of the general manager.

Another

area where change is required is in the rights of the branch with

regard to agents and their warehouses. Because of changes in policy

which now permit agents to warehouse liquor for sale through the liquor

distribution branch, it's necessary to have specific powers for the

branch to inspect such facilities.

[Mr. Strachan in the chair.]

Searching

for and seizing liquor is a potentially sensitive area, one which

requires close attention. The amendment clears up a jurisdictional

problem between the general manager and the provincial court.

This

section also applies when liquor has been seized and no charges have

resulted. Formerly a person whose liquor had been seized could apply

either to the general manager or the provincial court. Questions have

been raised as the propriety of such an application being made to the

provincial court when no charges have been laid. This amendment solves

the problem and also simplifies the procedure.

Another

amendment regarding the authority of a peace officer to search for and

seize liquor is a redraft of the existing provision and provides that a

peace officer may search anywhere, except a residence, without a

warrant. Under the present legislation officers of the branch are

empowered to search an individual if they suspect he is in illegal

possession of alcohol. The amendment limits that power to peace

officers. We feel this is strictly a law enforcement function.

Mr. Speaker, those are the highlights of our amendments. I move second reading.

MR. MACDONALD:

Mr. Speaker, this should be called the "bad old days bill" — you know,

a return to the slush funds of the liquor interests, Colonel MacGuigan

and his secret hearings, Anscomb with his winery and Gordon Wismer with

his liquor graft. That's what we're talking about in this bill.

AN. HON. MEMBER: Are you going to go further back than that?

MR. MACDONALD:

Yes. The former Attorney General could not hold his liquor, just as the

Minister of Health (Hon. Mr. Mair) couldn't hold his liquor. The

Minister of Intergovernmental Relations (Hon. Mr. Gardom) could not

hold his liquor.

DEPUTY SPEAKER: Hon. members, we are on Bill 18.

MR. MACDONALD:

This bill simply extends the Socred system in two areas. First you pull

down the blinds of secrecy over the liquor application process and,

secondly, you reinforce this kangaroo procedure whereby appeals — only

one kind of appeal and that is the appeal from denial of the liquor

administration of a licence, say, for a neighbourhood pub — can come to

the minister's desk. If it happens to be somebody that should get it,

in the opinion of that minister, he gets it. This is reinforcing, in a

small particular, the commissar-like powers of the minister to grant

liquor licences in his own office. Their capital value might be

hundreds of thousands of dollars before too many years pass by. We're

not talking about small change here.

Now let me step back

and say what has happened in the last three or four years. When the NDP

were government, we set up a body called the Corporate and Financial

Services Commission. It was not only to hear appeals in matters like

the Vancouver Stock Exchange and that kind of a listing, but it was to

hear appeals under things like the Liquor Control and Licensing Act,

which was changed and divided into two parts. That commission was

headed by Leon Getz in the early days, and all members will know that

they hold regular legal hearings. They publish reasons for their

decisions and they've established a body of jurisprudence of which the

province of British Columbia, I think, should be proud. But when the

Social Credit administration came into power, they very quickly — well,

it took a couple of years.... Under the then minister of Consumer and

Corporate Affairs, who is now the Minister of Health (Hon. Mr. Mair),

they made a little change to that procedure. They said that sort of

open, fair hearing before the Corporate and Financial Services

Commission was fine, except if you wanted to appeal against the denial

of a permit to run a neighbourhood pub, to get a lounge or that kind of

thing. They'd say: "If you feel aggrieved by that, don't appeal to the

open hearing of the commission. Go right into the minister's office and

see if he recognizes you. "

That

section of the act is now

being amended again in a small particular, as the present minister

honestly points out. It's merely to add that the appeal to the minister

is in relation to a process in the licensing process, and I suppose

that refers mostly to the pre-clearance letter. If you can get a

pre-clearance letter, you're on your way to the bank. I'm going to give

you

chapter and verse of just how that can happen and how it is

happening in this province at the present time.

In terms of

the confidentiality

section of this act, no person who is, or has been,

a member of the liquor administration branch shall be compelled to

disclose information. It's a drawing down of blinds about information

relating to the granting of liquor licences and permits, which is

coming at a very strange time, but which is perfectly consistent with

the Social Credit philosophy that what we do best we do in

[ Page 2959 ]

secret.

One might very well ask why this kind of information should not be

open, as it would be on an appeal to the Corporate and Financial

Services Commission, and as it would be on these appeals to the

minister's office, which are supposed to be open but are really not.

How can they be, when you just go into the minister's office? You used

to go into the present Minister of Health's office — somebody's been

turned down and he can grant it. It's the power of a commissar, and the

power to reward friends and punish enemies. That's the power that can

be exercised on the sole discretion of the minister without any kind of

a judicial process, without reasons being given. Why draw down the

blinds of secrecy, having already abolished the appeal process in

respect to rejection of these permits? Why shouldn't that information

be open, Mr. Minister, if you have — and you say you have — an appeal

process?

I'm making the Minister of Lands, Parks and Housing

(Hon. Mr. Chabot) uncomfortable, and I'm going to send him a snorkel.

We'll flood your valley, too, you know.

HON. MR. CHABOT: That's what the socialists wanted to do in 1963.

MR. MACDONALD: Let that go. That was not on the bill, Mr. Speaker.

you say in this bill that you have a proper appeal process in respect

to applications for a licence — a neighbourhood pub, a marine pub, a

lounge — why do you have to pull down the blinds on releasing all of

the information that's relevant to that appeal?

AN HON. MEMBER: Are you in favour of Gordon Gibson coming back?

Interjections.

MR. MACDONALD: Mr. Speaker, the reports of my coming political demise have been somewhat exaggerated.

DEPUTY SPEAKER:

Order, please. Would the Minister of Transportation and Highways (Hon.

Mr. Fraser) come to order, please. Thank you very much. All hon.

members, the second member for Vancouver East has the floor on Bill 18.

MR. MACDONALD:

Mr. Speaker, I'm going to have to designate myself if these people

don't be quiet. I'll run right over my time, not because of my own

words, but other people's.

Now, we've got a real funny one

in this bill. What do you call it, the Wismer bill? The Col. McGugan

bill? The slush fund bill? The B.C. Free Enterprise Education Fund

bill? It gets the funds in nicely, eh? Nobody knows anything about it

and you draw down the blinds. You say you have a fair appeal procedure,

but then you want to foreclose on information. You don't even want any

past employee of the liquor administration branch talking about an

application and saying: "That was not handled properly. That one was

partiality." Well, that's what we're talking about.

HON. MR. NIELSEN: Which pub are you speaking of?

MR. MACDONALD: I'll come to one specific instance before I finish.

HON. MR. NIELSEN: I hope you do. Was it 1975 or 1976?

MR. MACDONALD:

It was 1978 — the Grammas marine pub at Gibsons. I want to know what

Grammas knew in the granting of that licence that the other applicants

for that licence didn't know. I'll come to that.

So, Mr.

Speaker, in 1975 there was a full and fair appeal to the Corporate and

Financial Services Commission — an open appeal — and the NDP instituted

that. You are now extending the secrecy of the process and the

discretionary powers of the minister to decide these matters, which

inevitably — and I'm not attacking the minister in a personal way; he's

new in this — is going to lead to the power to punish enemies and

reward friends. That's what we're talking about in this particular bill.

The

minister says: "Let's have an example.'' I'll give an example. When the

former minister, who is now the Minister of Health, was the appeal body

under this act, and was the Minister of Consumer and Corporate Affairs,

a family by the name of Janowsky applied for a neighbourhood pub at

Gibsons Landing in the province of British Columbia. They were from

Kamloops and they were strangers to the Sechelt Peninsula. They were

not strangers to the minister. They applied under the name of All

Sports, and it later became Grammas Marine Inn Ltd.

I am not

talking about a case where Mr. R. Dale Janowsky, former and perhaps

future partner of the Minister of Health, was the advocate or counsel;

I'm talking about his seeking this licence in his personal capacity

along with members of his family, Richard Janowsky and Etna Janowsky.

There were two problems about the application that had been made by

Janowsky at Gibsons Landing. The first problem was that they couldn't

get a neighbourhood pub because the rules of the neighbourhood pub

forbid the grant of an application when it's too close to a highway —

the minister would know about that part — and also when it's within a

mile of another certain kind of liquor outlet. Already in Gibsons,

within a mile, you had Cedar's Inn up the top of the hill and you had

the Legion. So the application of the Janowskys could not be granted.

should add one other thing. There were also three other applicants for

that licence. The community wanted a neighbourhood pub in Gibsons and

there were three other applicants. As far as I know they were local

people; I know one at least was local.

So the Janowskys had

a problem. The problem was miraculously solved by a change in the

regulations; that change in the regulations made it possible for them

to get their licence. It came in the form of an order-in-council of

April 20, 1978, signed by Hon. Mr. Mair, the Minister of Consumer and

Corporate Affairs, and the Premier. It established an entirely new

category of pub which could be granted at Gibsons Landing, called

marine public houses. It established the way in which you applied for a

marine public house.

DEPUTY SPEAKER: Hon. member,

although great latitude is allowed in second reading, could you please

relate to the assembly how your statements relate to Bill 18, the bill

before us now?

MR. MACDONALD: Yes, I'm opposing the secrecy provisions of Bill 18 and I'm giving an example of the kind of

[ Page 2960 ]

thing

that could be covered up. It should be brought to public attention.

This is an example of an application that would be made under the same

act and which would be covered by the "confidentiality provisions" of

the new bill.

So they established the marine public house at

Gibsons and across the province. Miraculously — just like the bread and

fishes which were miraculously produced in such a short space of time —

the Janowskys' application for the new marine public house was granted

within five days, and the other applicants are still out there

wondering whatever happened to their applications; they didn't hear a

word. The Janowskys' application was granted in terms of a preclearance

— and I'll come back and tell you what the preclearance is if you have

any confusion about that, Mr. Minis ter. I'm talking about a

preclearance letter which went out from the liquor administration

within five days of the passage of the order-in-council and before it

was even published in The British Columbia Gazette , which didn't take

place until May 9, 1978. What I'm asking is: what did Grammas know that

the others didn't know? How in the world could they make an application

of that kind unless they had friends at court?

Under the new

complicated provisions of this order-in-council which require for a

marine pub — no minors permitted.... Some of the things are fairly open

and straightforward. The seating is a little different; I think it's 85

here rather than 95 for the neighbourhood pub. But you have to have

facilities for moorage of boats; food; ice; fishing tackle; basic

marine provisions; laundromats and laundering facilities; adequate hot

and cold showers for men and women. I would think that somebody who's

going to apply for a new marine pub which wasn't in existence until

April 20.... No such thing could be applied for, because there wasn't

one. That order-in-council, I suppose, was registered the following day

with the registry and not even published until May 9, 1978. I would

think that somebody who got advance notice of that order-in-council

could get together an application form with all these complicated

things — the new requirements for a marine pub — and maybe get it into

the liquor administration board. I don't know whether they'd mail it,

because the mails would hardly allow you to get your application in and

your preclearance letter out within five days. That's blinding speed.

But the other three applicants, residents of the Sechelt Peninsula,

didn't know of the new order-in-council, so they could hardly apply,

could they?

The preclearance letter went out with blinding

speed, as I said, within that period of four days. That was the ball

game. Grammas' application was investigated over a period of more than

a year and finalized by a grant in 1979, when the licence was

finalized. The point is this: the preclearance letter, issued in very

mysterious circumstances within that short period of time — to get the

complicated application in and then have it immediately acted upon in a

preclearance letter — was the ball game. When they had that and they

appeared before the local council at Gibsons, they were the only

ones....

Interjection.

AN HON. MEMBER: You asked for an example. He's giving it.

MR. MACDONALD: Yes, he asked me earlier to give an example. I'm giving it to you in spades.

HON. MR. NIELSEN: No, that's not an example. There was no appeal, which is apparently what he's concerned about.

MR. MACDONALD: No, I'm concerned about secrecy.

HON. MR. NIELSEN: Oh, I see. You've changed your tune.

MR. MACDONALD: On both.

DEPUTY SPEAKER:

Order, all hon. members, please. The second member for Vancouver East

has the floor and we are debating Bill 18. It would be appreciated if

we could stay within the content of Bill 18.

MR. MACDONALD:

Mr. Speaker, if you get what's called a preclearance letter on your way

to getting your application accepted, in the circumstances of this

case, I say that was all you had to have to put your rival s out of

business. What happens, as the minister knows, is that it has to go to

the municipal council of the area. But the municipal council had its

hands tied by what this administration had done, as is pointed out by

Ted Hume. This is from the Peninsula Times of June 21, 1978, shortly

after the new order-in-council: "Planning Committee chairman Ted Hume

noted in his motion that the Janowsky application is the only one of

four such requests thus far to have received the required liquor

administration board preclearance." That was the preclearance issued

with blinding speed — when they couldn't get a neighbourhood pub and

the regulations were changed to one they could get. "The Janowsky

application that was stated was the only one we could act on." That's

what they said in council.

With leave, may I allow an introduction to interrupt my speech without losing my place?

Leave granted.

HON. MR. VANDER ZALM:

Mr. Speaker, on behalf of myself and the second member for Surrey (Mr.

Hall), I appreciate the hon. second member for Vancouver East giving me

the floor to allow an introduction of a school from Surrey. We have

with us the J.T. Brown Elementary School and their teacher, Miss Donna

Bodner. I would ask the, House to welcome all the students from the

J.T. Brown Elementary School.

MR. MACDONALD: I hope I

didn't lose my place, Mr. Speaker. I don't think that hon. minister

would play that kind of a trick and get me sort of grounded on that

kind of a thing.

You know, the procedure all sounds great.

You've got to not only get your preclearance from the liquor

administration, but then you have to go before the municipal council.

But as they point out very clearly in the Gibsons council, the guys who

wanted a facility and came along with the only preclearance were the

Janowskys, so they got it. They got the approval of the council.

MR. KING: Do you think the minister recognized his former law partner?

MR. MACDONALD: In fairness to the minister, I

[ Page

2961 ]

should

give his position. In the Victoria Times of May 16, 1978, when he was

asked about this matter — it had been raised earlier — the minister,

your new-found colleague of five years ago, said that he has not been

associated with the law firm since December 1975, and at no time

exerted any influence on the granting of the preclearance. He said he

was not even aware of the application. His partner was applying for

this licence and he was not even aware of it. That's the statement of

the former minister from Kamloops. But then he's a little more aware

later on, on May 13, 1980: "Mair meanwhile suggested that there was

nothing mysterious about the pub licence. He said there were a lot of

applicants waiting around for the regulations to be changed to permit

marine pubs. Janowsky was just the first to pounce.''

Grammas

pounced first. But apart from who put the tiger in Grammas' pounce, and

what Grammas knew that the other applicants didn't know, because they

didn't even receive the courtesy of a visit from a liquor

administration inspector; they didn't know the regulations had been

changed; they were not informed of the change; the Gazette — if they

read it — had not come out.... Grammas pounced and got the marine pub

licence, and the minister knows nothing about it. Every once in a while

he visits his former partner in Kamloops — I would say probably, in

terms of the firm, his once and perhaps future partner — who is a

political crony. And he knew nothing about it!

Interjections.

DEPUTY SPEAKER: Perhaps the hon. second member for Vancouver East could relate the debate to Bill 18.

MR. MACDONALD:

As suggested by the minister, I am giving an example — not of the

appeal process, because in the area of granting a permit there is no

appeal; it is only when one is refused that there can be an appeal. I

am giving an example of a subject area where we should not pull down

the blinds and pass this so-called confidentiality section.

The

former minister — who was the minister in charge at the time Grammas

got its preclearance letter — is a member of the law firm of Mair,

Horne, Janowsky and Blair, and had been a partner of Janowsky for many

years. Talking about this kind of application, I don't mind saying

quite frankly that I do not think a minister of the Crown — even though

he has severed connections — should still have a law firm out there

which is using his name, because people assume that that is a

government law firm. The administration assumes that that is a

government law firm. They used to say something about "justice should

not only be done but be seen to be done. " I am glad to see that the

Attorney-General (Hon. Mr. Williams) took his name off. I got right out

too. I think it is wrong....

DEPUTY SPEAKER: Hon. member, we are on a Consumer and Corporate Affairs act, Bill 18.

MR. MACDONALD: Yes, but this application was made by this firm with

the minister's name on it, and people would assume that that is a little

different kind of an application when it comes in that way. In terms of the

range war that the lawyers fight in Kamloops for legal patronage, do you know

how much Mair, Horne, Janowsky and Blair got in the last three years from this

government? Two hundred and ninety thousand dollars. Oh, they lost the federal

battle for the patronage, the legal spoils, the prosecutions and all of this.

AN HON. MEMBER: What about John Brewin?

MR. MACDONALD: That may be a funny one too, but I am talking about this one. I don't know about that.

DEPUTY SPEAKER:

Order, please. All hon. members, we have to return to second reading of

Bill 18 and the Ministry of Consumer and Corporate Affairs.

MR. MACDONALD: Anyway, do you remember how they fought for the federal Liberal patronage in Kamloops — how they fought and Mair lost out?

DEPUTY SPEAKER: Hon. member, please, Bill 18.

MR. MACDONALD:

He won hands down in the provincial lottery for legal assistance,

through your department, Mr. Attorney-General. I know some of it was

Legal Services Commission. I'll give you the figures — five times as

much as any other firm got.

[Deputy Speaker rose.]

DEPUTY SPEAKER:

Hon. member, we are on Bill 18. Our standing orders indicate that we

must be relevant when we are discussing matters before us in the House.

[Deputy Speaker resumed his seat.]

MR. MACDONALD:

I'm sorry, Mr. Speaker. I was looking at the Attorney-General and I

thought for a minute that we were examining his department, but we

haven't quite reached that stage.

Anyway, whose name led all the rest? The minister who knew nothing about it, eh?

Mr.

Speaker, I am serious when I say this bill is a return to the bad old

days. I don't think there should be secrecy in a field which is as

fraught with the possibilities of corruption as liquor. I think there

has been nothing in our province — and other provinces; Nova Scotia or

wherever you turn — which has more corrupted the political process than

liquor, secrecy and campaign donations. In the case of Nova Scotia,

they directly paid the Premier himself an additional amount over and

above his salary while he was Premier — bought him. Well, they didn't

buy him. I'm not attacking his integrity. He is a friend of mine, if I

may say so.

I do attack this kind of drawing down the blinds

in an area of this kind. We thought for a while that we had got away

from the bad old days, but I have seen them creeping back under this

administration. To pass this present bill, which contains these

sections which are euphemistically called confidentiality but which in

fact say to the public servants, "Don't whisper a word about anything

that is happening in the application process," and to enhance and

enlarge the powers of the minister to allow people to appeal to him in

his own office, where the hearing is without reasons, to enlarge those

powers rather than have the appeal to a public body which gives reasons

for its decisions, is a retrograde step and a very dangerous one for

this province to take.

MR. LEVI: Mr. Chairman, I just want to, for your

[ Page 2962 ]

interest, quote the

section on confidentiality in the bill, and then make some general comments in respect to that. It says:

"1 No person who is, or has been

(

a) an employee of the branch, or

(

b) engaged in the administration of this act or the regulations

shall be compelled to disclose any information contained in records of the branch

respecting the licensee or any applicant for a licence, except

(

c) where the disclosure is necessary to administer this Act

or the business of the branch,

(

d) where the disclosure is made with the consent of the licensee

or applicant to whom the record relates,

(

e) in court proceedings, or

(

f) where the general manager authorizes disclosure."

Mr.

Chairman, for some years the Liquor Control and Licensing Act has not

really had a

section in there. That

section seeks to amend

section 4 of

the present act, which reads:

"

(1) Officers and other employees required for the purpose

of this act may be appointed pursuant to the Public Service Act.

"

(2) The general manager shall issue written directives to the officers,

and a directive affecting the public shall be made available for public

inspection at the offices of the branch."

That's all the

present act says, and now we have the minister bringing in a rather

detailed section. I think that we might well ask, and have the minister

explain to us when he closes debate, just what the purpose of this is,

because people who work in the liquor branch, as the

section says, "may

be appointed pursuant to the Public Service Act." Within that act are

requirements by all public servants in respect to the job and the

nature of confidentiality and what their obligations are. But in this

particular amendment that I'm dealing with the minister has taken the

trouble to spell it out; he's gone to some trouble to point out to

public servants that no information has got to be made available unless

under the certain circumstances that are outlined in the amendment. Why

has it suddenly become necessary to have this particular amendment to

the bill, given that as far as we know the operation of the branch has

not had problems in terms of leakage of confidential information?

Now

we're dealing, Mr. Speaker, with an industry which is worth well over

$500 million, and I think in this fiscal year a little over $500

million; last year it brought in to the government some $262 million.

It's an exceptionally high profit industry. I think it's part of the

confounding problem that governments have, because on the one hand they

operate the liquor industry and on the other hand they're also

responsible for health matters relating to alcoholism, and there is

always the argument of the conflicts about how far you go with selling

liquor and how far you go with trying to combat the problem of

alcoholism due to the sale of liquor. Well, that one has never been

resolved — it has not been resolved by this government or the previous

government — but it's one of those conundrums that one day we're going

to come head on and face.

Now we must have some very serious

concern about the issue of confidentiality, and the reason I raise

this, Mr. Speaker, is that generally speaking we don't know a great

deal about the operation of the liquor administration branch. Now I

know that they do publish an annual report. The latest annual report

which was tabled in the House for April 1, 1978, to March 31, 1979, has

an item on page 2. It says:

"Communications

division. After many years of maintaining a low profile, the branch

entered into a formal information program during the fiscal year with

the establishment of the communications division. The objectives of the

new area were to provide the branch's public with timely, consistent

and appropriate information on the role of operations of the branch,

and to improve morale and increase staff awareness of the branch's

objectives and job responsibilities.

"To meet

these internal-external information needs, programs were developed to

communicate with customers, including licensees, branch employees, the

news media, other government agencies, suppliers and agents, special

interest groups in industry and trade and associations."

The

only group that's missing from there is the legislators. However, we

can, I presume, go over there and talk to the various people in the

liquor administration branch about what they're doing. They're not

given, at the moment anyway, to a great deal of information in writing.

The number of press releases that group issues is very small.

The

annual report talks about an attempt for a great deal of openness.

They've got an education program and a communications program going.

They're going to inform everybody within the bounds of the existing

act, and presumably once this particular

section is passed there'll be

other information. But there will be a tendency, I think, when this

legislation is passed, for the giving of information to be a little

more restrictive. It may very well be that the minister might argue

that the reason this amendment is being brought in on the issue of

confidentiality is because for the better running of the business of

the liquor branch and the various companies that deal with the liquor

branch, and because of business competition, it's desirable. Well, I

don't particularly subscribe to that argument. One of the great debates

that goes on in the corporate sector is the whole business of

disclosure: how much information needs to be made available to the

public in terms of corporate operations? There is always a great deal

of curiosity about the amount of information that should be available

in respect to the liquor administration branch and to the various

corporations that deal with liquor. We had, some weeks ago, a rumpus in

respect to Mr. Nick Clark, where certain allegations were made — albeit

in the press — in respect to Mr. Clark's role of having a crimp put in

it because of what he was doing in terms of the operation of the liquor

administration branch.

I want to say, Mr. Speaker, that it's

not only difficult, but it's going to be impossible; I think the second

member for Vancouver East (Mr. Macdonald) has established that

position. If we pass this legislation there is going to be a great deal

of secrecy about what takes place in the whole operation of liquor in

the private sector and in the public sector in this province.

want to give you an example. In the state of Washington they publish a

report. This is the Washington State Liquor Control Board for roughly

the same years — July 1, 1978, to June 30, 1979. This is the report

that we publish here and this is the report that they publish down

there. What's in here that is missing from our report is perhaps the

kind of information that this amendment envisioned will never be made

available. I want to point out to you that after giving a complete

[ Page

2963 ]

rundown on how much money they make, where the

money is made — in what particular towns, through what particular

outlets.... Of course, they have a government revenue sharing program

down there between municipalities, counties and the government.

the end of the book there is a very detailed

summary of all of the

companies that do business with the government and all of the agents

that deal with the government, how many cases of liquor are bought and

from which groups. In fact, you have all of the information that you

really need to know and that we do not know about in this province

unless we go seeking the information. It's not a question of seeking

the information. The state of Washington make it available as a matter

of course in their report. There are always great debates going on

behind the scenes in the liquor industry about agents and their

competing for shelf space and the kind of products that they would like

to have on. It's possible to analyze in the report from Washington

state whether anybody has a pre-empted position in terms of the role

with the government and how much they get on the shelves, but we don't

know that in British Columbia. We've had a history in this province of

dealing with the liquor industry at arm's length, publicly and

privately, in a kind of embrace.

The whole history of this

province, from after the First World War right up to the middle of the

1950s, is a series of allegations and innuendos about the role of

liquor and the power that it has in terms of influencing government.

There were great debates in this Legislature and commissions were

ordered in this Legislature to look into the whole question of how the

liquor industry operates. Certainly since 1950 we've had two royal

commissions. We had, I think, the Stevens commission and then we had

Judge Morrow's commission, but at no time did those commissions deal

with the kind of issues that appear to be involved in this particular

amendment confidentiality.

I said it at the beginning of my

remarks. Why does the minister find it necessary to bring in guidelines

as to how much the staff can tell either the public or individuals? Why

has that suddenly become necessary? Is the government getting ready to

produce a book like this, a report like the state of Washington report,

which gives all of the details of all purchases and transactions almost

to the minutest detail? They talk about the companies, the kind of wine

they sell, the size of the bottle, how much money was made, what it

cost for the case. They talk about markup; now there's a question.

Confidentiality — what is the whole issue here in the markup question?

There have been some accusations made by the industry in general that

the markup on liquor in this province is too big. We had the second

member for Vancouver East a few weeks ago in this House talk about the

seven increases in beer. That interests a large number of people out

there. There are also other increases. Last year in Ontario there was a

debate put on by the industry in respect to the excessive marking-up of

liquor in Ontario.

If we are to move towards confidentiality

— I suggest, in respect to the corporate sector, you can read "secrecy"

for I "confidentiality" — then we're going to have a great deal of

difficulty finding out the nuts and bolts of the liquor operation in

this province. It is important that we know about this because it's a

big industry — a half a billion dollar industry at least. That's just

on the revenue for a year. It represents a significant amount of money

for the government in terms of its revenue. Something of the order of

almost 6 percent of the total budget of revenue to this province comes

from liquor. If we're to move towards confidentiality, then we have to

be suspicious as to what it is they're attempting to cover up.

few months ago an announcement was made by the Quebec Minister of

Justice. I just want to read what this says. It was published in the

Montreal Gazette on January 26, 1980. The story is headlined:

"Twenty-five Firms Accused of Bribing Liquor Board Employees."

"Twenty-five distilleries and spirits and wine importers

were charged yesterday with paying bribes totalling almost $1 million to employees

of the Quebec Liquor Board and its predecessor, La Régie de Liqueur du Quebec.

The affidavits filed by the Quebec Provincial Police alleged the payments were

made between 1965 and 1977. The board operates about 200 liquor stores across

the province. The Régie was phased out in 1971."

Now

the companies. Alberta Distilleries Ltd. was charged — they list a

number of other companies. Nearly all of them are doing business in

this province. We have been told, although I don't think it was in this

House, by the Attorney-General that information was sent by the

Attorney General and Minister of Justice of Quebec to every province in

Canada relating to some kind of problem in respect to this particular

issue — I think it was called kickbacks or bribes. As I understand it

from the information I have, this matter is under consideration by the

Attorney-General's ministry here. When they did a series of raids on

these various companies, they picked up information which indicated

that this particular problem of bribes did not just stay in Quebec. It

went across the country — to Ontario. In the last four or five months

Ontario has had a number of officials from their liquor branch in

court. They were fined heavily for accepting various considerations.

Nobody's

suggesting at this point in time, Mr. Speaker, because we don't have

the information from the Attorney-General as to whether the information

is based on anything.... Nevertheless, we have always had in this

Legislature and in the general public a great deal of suspicion as to

how that industry operates, and its relationship with governments. We

don't have in this province, unfortunately, a large number of people

who chronicle the history of this province, so the public is not

generally aware of the kind of role that the power of the liquor

industry, particularly because of what was referred to in those days, I

suppose, as bootlegging in the United States....

We became a

major source of supply for the United States. We operated some of the

largest and fastest well-armed boats that used to deliver liquor to the

United Sates. There was a constant war being fought within this

province by the police and the customs to prevent this kind of thing

happening. Tragic events took place as a result of this kind of

operation that was going on in the 1920s and 1930s, up until 1934 when

the Volstead Act was repealed in the United States and that kind of

problem went out of the window. Nevertheless. a large number of people

were able to make substantial fortunes. Those companies were the

subject of a royal commission inquiry in 1928 under excise and revenue.

1928 there was a royal commission. They came to British Columbia and

they called all of the people that ran the liquor industry as

witnesses. Unfortunately — and my friend the former Attorney-General is

laughing — I tried to get a copy of the transcript of that hearing and

I couldn't get it. I'm still trying to get a copy of the transcript

from the National Library in Ottawa. They had all of the liquor owners

in the

[ Page 2964 ]

1920s before this commission. An excellent man was doing all of the cross-examination

for the government, a Mr. Rowell, who was famous for the Rowell-Sirois report.

I can't find that yet. I was, looking at the newspaper clippings and I

began to realize how powerful liquor industries were and how influential they

were in the operation of every govern ment of that day, never mind just this

one.

That's

the kind of history that we started with in this province. As we go on,

we know there were allegations, court cases in respect to where parties

get their money, resignations and prison sentences. Al Williams told it

all in his trial that took place.... What we look for....

HON. MR. WILLIAMS: Williamson.

MR. LEVI:

I beg your pardon. I'm sorry, I obviously upset the Attorney-General.

Yes, you're quite right. It was Al Williamson, who is in no way related

to the present Attorney-General or to the former Minister of Lands and

Forests.

There are always hints about it, partly because

there's a tendency to be secret. Having all of this knowledge, the

minister responsible for the department comes into the House and tells

us that he wants to amend the bill, restricting the degree of openness

that can exist with public servants. This is already covered by the

Public Service Act anyway. He spells it out and I'm very curious as to

why he's spelling it out.

The minister issued a press

release on April 30 and he starts off by saying: "Amendments to remove

ambiguities and deficiencies in B.C. liquor laws were introduced in the

Legislature today. Consumer and Corporate Affairs minister James

Nielsen, who is responsible for liquor control, licensing and

distribution, outlined several major highlights of the legislation." I

didn't get the impression when the minister introduced the bill that

they considered these to be major highlights. I thought he indicated

they were a little bit of housekeeping.

[Mr. Davidson in the chair.]

continues: "Rules of confidentiality of branch files will be

established to ensure that relative information will be more accessible

and that sensitive material is available only to the proper authority."

What has changed in the operation of the liquor administration branch

for the minister to spell this out? What really has changed? Is he

telling us that certain information he wants to get from companies has

never been available, or is he saying that information that the various

corporations wanted was not available for them because the ministry

wouldn't allow it? What does it mean? What is this exchange or

reduction in the availability of information?

It's fair

comment to say to the minister that this is not just a housekeeping

change. If there was a problem, tell us about it. Did you require

certain information from liquor corporations that would benefit the

operation of the liquor branch? Did our taxation department require

information so that they could get an adequate understanding of what

was taking place in respect to the payment of taxes? After all, it's

not just the provincial government that's involved in this; it's also

the federal government that has an interest. Even if the minister gives

us a satisfactory explanation there's no reason for us to consider for

one minute allowing this bill to pass, because all it tends to do is to

restrict the availability of information.

If there's nothing to hide, there's no reason why the minister cannot

give consideration to looking at a giving of information of the kind given in

the state of Washington annual report. There's nothing wrong with that at

all. We do not know as a matter of public information who are the major suppliers

in the liquor or wine industry — whether any of the companies have a predominant

position in respect to the sale of their particular wares in warehouses. We

have never had a discussion in this House about what that kind of selection

process is. We've had a lot of complaints, either by letter from individuals

who've complained that they can't get a particular product, or occasionally

we hear from a corporation that's having trouble getting the right kind

of shelf space so that they would be able to move their wares in a particular

way. But we don't have any of that information. Not only do we not have

that, but now the minister is telling us that even less information is going

to be made available.

The

great debate in the corporate sector right now and also among

accountants, Mr. Speaker, is the business of how you make information

available. That's important. This particular

section of the act can

only have one ultimate result. I just want to repeat what it says. In

section 2(4): "A person who is or has been (

a) an employee...." "Has

been" — the suggestion here is that if this passes, an offence can be

committed by somebody who is no longer a public servant. But because he

was an employee of the liquor administration branch.... If this

section

passes, it means that the arm of the law can reach out to somebody who

may have been out of the government for 5, 10 or 15 years. Why? Why is

it necessary?

Interjections.

MR. LEVI: The

former Attorney-General makes a good point. It says here: "No person

who is or has been (

a) an employee of the branch, or (

b) engaged in the

administration of this Act or the regulations" — that includes the

minister who is introducing the bill — "shall be compelled to disclose

any information contained in records of the branch, respecting...."

I'm

not quite sure what "shall be compelled" means. Is somebody going to

pick him up off the street, take him into the back room, punch him out

and say: "Look, we are compelling you to tell us what's going on"? The

former Attorney-General, who was responsible for some of the most

monstrous errors in writing legislation — he had more bills turned over

by the appeal court than anybody — sits there and goes: "Harrumph!"

AN HON. MEMBER: Step outside and say that!

HON. MR. GARDOM: Are you talking about me?

MR. LEVI:

No, he's the most recent former Attorney General. We'll call him

"former Attorney-General no. 1." And then we'll talk about the others.

From now on he is referred to as "numero uno." Perhaps he is feeling

bad because he is now the first member for Vancouver–Point Grey (Hon.

Mr. Gardom).

I want to go back. These are the kinds of questions that the minister should be prepared for when we get into committee stage.

"No

person who is or has been (

a) an employee of the branch, or (

b) engaged

in the administration of this act or the regulations shall be compelled

to dis-

[ Page 2965 ]

close any information contained in records of the branch, respecting

a licensee or an applicant for a licence...."

DEPUTY SPEAKER:

Order, please. Hon. member, it is irregular to a degree to refer

specifically to sections in second reading, where we are covering the

principle.

MR. LEVI: Quite right. I appreciate what

the Deputy Speaker is saying, but this particular

section is a problem

that we have with this bill. Inside the great cloak of secrecy — or

confidentiality, but I would prefer it to read "secrecy'' — we are

also looking at going way past present employees to former

administrators of the act and regulators, and they can be placed in

trouble. There has to be a very basic reason — that the minister has

not yet told us, but I hope he will share it with us — why he suddenly

needs to have this kind of legislation. We dealt with amendments to the

liquor administration branch in 1977, 1978 and 1979. It was not

necessary to bring in this kind of thing.

The general

discussion in the community at large with respect to how business was

being conducted was on the basis that there needed to be a greater

openness — in terms of the government as well. We look forward to the

day when the government brings in a freedom of information bill and we

can really get the information. Meanwhile, we could look just over the

border to another administration that is quite prepared to make the

kind of information available that exists in this report. That

information — and some of it that is in there — I suggest would be

restricted by the intent of this legislation.

Now the

minister introduced the bill; he spent very little time on this

section; he talked about other amendments in the bill, but not on this

one. He characterized the bill when he first introduced it as a little

bit of housekeeping; he just wanted to clear this up. In some of the

other bills the ministers sometimes say: "There is a little bit of a

problem here in terms of definition." But the one

section that he

never really explained to us was the business of why it is entitled

"Confidentiality."

Of course, we are prepared to take the

position that it's more than confidentiality; it is in fact an

infringement of the right of people to know. Now there is the big

argument, of course, that always takes place — not only in this

industry but in the corporate sector — as to how much information

should be given on one corporation or another by a regulatory agency

which could affect the balance of competition. You know, that's the

kind of argument that was on some years ago in respect to trade unions

versus corporations — how much information should be made available.

Well,

Mr. Speaker, I suggest that in an industry that is worth over half a

billion dollars and next year will probably go to $550 million and in

the following year to $600 million or $700 million — and probably down

the road, in four or five years, the revenues will be almost $1

billion.... By then, the Minister of Lands, Parks and Housing (Hon. Mr.

Chabot) will have retired from this august chamber and will be living

in the south of France.

HON. MR. CHABOT: How far down the road?

MR. LEVI:

Oh, possibly three or four weeks, depending on the whims of the

Premier, how he's feeling tomorrow when he steps out of the bathtub.

We're going to go next week or the week after.

Interjection.

MR. LEVI:

There he is: he's giving away vital, confidential information about the

government. He just gave us some information, Mr. Member; we simply

have to analyze what he was talking about.

Mr. Speaker, I

would implore the minister, through you, to tell us what it is he's

talking about when bringing in this

section in respect to

confidentiality. That is absolutely essential. If we're going to have

any reasonable debate on this bill, particularly in the committee stage.

have made a number of allegations. The first allegation is that there

is secrecy, that the only way that you apparently can conduct business

in the liquor industry is behind closed doors. Another suggestion is

that it's sometimes only friends of the government who can get

advantages. Those are charges that are being made and they have to be

answered.

Interjections.

MR. LEVI: We're

talking now about the government which compromises an amalgam of

politicians who go under the title of Social Credit. Well, that's the

way it is — it came together and it sticks together with glue, and it

will probably fly apart the same way.

Those are two

allegations. The first one is: can business only take place in this

industry behind closed doors? Is that what it is — only friends of the

government can get the kind of assistance that's needed in an industry?

We know that if you have an opportunity to get into the industry, it's

almost like a licence for printing money. Why, the Bronfmans, who are

extensively in the whisky business, were very sly in a small operation

two weeks ago and got rid of $2.3 billion in oil and gas shares. You

know, that's just a sideline.

HON. MR. CHABOT: Is that your friend Sam Bronfman?

MR. LEVI: Watch it there, Mr. Member, or else I'll have you up on privilege. A joke's a joke, but that's it.

DEPUTY SPEAKER: Order, please.

Mr. Levi moved adjournment of the debate.

Motion approved.

MR. MUSSALLEM: I ask leave to make an introduction.

Leave granted.

MR. MUSSALLEM:

Mr. Speaker, with us today in the gallery is Mr. Ted Reeves, a stalwart

citizen of Maple Ridge. With him are his brother and sister-in-law from

England, who are visiting British Columbia and touring the province. I

request the House to make them welcome.

Hon. Mr. Gardom moved adjournment of the House.

Motion approved.

The House adjourned at 12:57 p.m.

[ Page

2966 ]

APPENDIX

AMENDMENTS TO BILLS

The Hon. B. R. D. Smith to move, in Committee of the Whole on Bill (No.

20) intituled S chool Amendment Act, 1980 , to amend as follows:

Section 1: By deleting paragraph (

b) and substituting the following:

"(

b) by striking out 'until December 31 of the next calendar year,' and substituting 'for 2 years from that date, '."

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