Third Session, 41st Parliament

(2018) OFFICIAL REPORT

OF DEBATES

(HANSARD)

Tuesday, May 8, 2018

Afternoon Sitting

Issue No. 131

ISSN 1499-2175

The HTML transcript is provided for informational purposes only.

The PDF transcript remains the official digital version.

CONTENTS

Orders of the Day

Second Reading of Bills

Bill 17 — Motor Vehicle Amendment Act, 2018 (continued)

A. Olsen

J. Yap

D. Clovechok

R. Sultan

Hon. M. Farnworth

Bill 29 — Voluntary Blood Donations Act

Hon. A. Dix

N. Letnick

S. Furstenau

Hon. A. Dix

Bill 25 — Real Estate Development Marketing Amendment Act, 2018

Hon. C. James

S. Bond

A. Weaver

D. Barnett

T. Redies

Hon. C. James

Bill 28 — Public Interest Disclosure Act

Hon. D. Eby

M. Lee

A. Weaver

Hon. D. Eby

Bill 19 — Protected Areas of British Columbia Amendment Act, 2018

Hon. G. Heyman

P. Milobar

S. Furstenau

S. Thomson

S. Chandra Herbert

J. Rustad

L. Krog

D. Barnett

A. Olsen

Hon. R. Fleming

M. Stilwell

Hon. G. Heyman

Proceedings in the Douglas Fir Room

Committee of Supply

Estimates: Ministry of Mental Health and Addictions

Hon. J. Darcy

J. Thornthwaite

S. Bond

J. Isaacs

16:09:03, P. Milobar, “need to be undertake.” changed to “need to be undertaken.”

TUESDAY, MAY 8, 2018

The House met at 1:34 p.m.

[Mr. Speaker in the chair.]

Orders of the Day

Hon. M. Farnworth: In this House, I call continued second reading debate on Bill 17, the

Motor Vehicle Amendment Act. In Committee A, I call the estimates for the

Ministry of Mental Health and Addictions.

[1:35 p.m.]

[R. Chouhan in the chair.]

Second Reading of Bills

BILL 17 — MOTOR VEHICLE

AMENDMENT ACT,

(continued)

A. Olsen: It’s a pleasure today to rise to speak, at second reading, to Bill

17. I would like to recognize the minister and the ministry for the

substantial challenge that they face as we are now starting to get into

a body of work that the minister has to deal with, with respect to

cannabis policy, as the federal government is moving towards a different

regime for controlling cannabis in our country. I do want to recognize,

as I’m working through these bills, that the minister has got, in many

cases, moving targets that they’re working with. That can’t be easy when

you’re creating legislation.

I think this bill, when it comes to the Motor Vehicle Amendment

Act, is an example of that. So I just want to acknowledge the challenge

that the minister and the ministry have and, as well, how incredibly

important it is that we get this piece of legislation right.

Public safety is incredibly important. Getting it right is going

to be a challenge, acknowledging the fact that there’s a reason why this

country is moving towards legalization of cannabis and, perhaps, that

there are quite a bit of people partaking in cannabis out on the

streets. I think that it’s important that we get this piece right and

acknowledge that even the ability to test drivers who might be under the

influence of cannabis is a substantial challenge.

As I see this, this bill will be passed by a regulation.

Therefore, I expect it will also be evolving over time as we and as

technologies…. As we become more experienced on this issue, I expect

that there will be changes that are made through regulation.

Of course, we’re going to be moving this forward to committee, but

at this point in time, I just want to acknowledge early that I think

that one of the key pieces to diminishing the amount of cannabis

consumption and driving will be education. I note that the government

has already begun a fairly substantive campaign. This would be one

campaign that I certainly won’t complain about public resources being

put into, in a substantial way, to ensure that youth right through to

adults are educated and given the information to ensure that we decrease

the instances of consuming cannabis and driving.

I note that I grew up in the late 1980s and 1990s. Even since that

time period to now, we’ve had a substantial change in the public

perception around drinking and driving. I would credit that, at least

from my experience, as a great deal due to the public education that was

undertaken by previous provincial governments going back a few decades —

having it front and centre in our high schools and having the

conversation and the road-check system and bringing it to the public’s

awareness that it’s not safe to be consuming drugs or alcohol and

driving.

Certainly my hope — and probably outside the purview of this bill

— is that the government does take advantage of the substantial

opportunity to educate British Columbians and continue to do it. As I

note, to a great extent, it’s already happening.

Finally, before I take my seat, I would just like to also point

out that we’re not the only jurisdiction that struggles with the ability

to test drivers or the ability to overcome the challenge of THC

remaining in the bloodstream, unlike alcohol. There are significant

challenges that THC poses that alcohol does not. We’re not the only

jurisdiction right now that’s challenged with that.

[1:40 p.m.]

Of course, every jurisdiction in Canada will be looking at that

and dealing with it in their own way. In addition, I think jurisdictions

in the United States of America are also looking at this. Some are

getting it right; some maybe not.

I see that the minister for jobs, trade and innovation is here.

This is a significant opportunity to drive innovation, to put a

challenge out to the innovators in our society and say, “We’ve got a

really wicked problem here, and that is that the federal government is

moving towards legalization, creating a different system of controlling

cannabis, and we need tools to be able to hand to our public safety

officers, to keep the public safe,” and turn the amazing minds of

Canadian colleges and universities on to this. I’m sure that they

already are — but maybe some kind of challenge to really see if we can

come up with a solution.

I’ll just leave it at that. It was some good luck that the

minister was here today, and I had an opportunity to present that to him

directly in the House today.

Having said that, I look forward to the committee stage of the

discussion and the debate. We’ll be going through this clause by clause,

and I look forward to that. I do have some questions and some

clarification of the minister and the ministry, and I look forward to

that opportunity. At this time, I’ll take my seat and thank the minister

for the good work on this bill today.

J. Yap: I’m honoured to take my place in this debate on Bill 17, the Motor

Vehicle Amendment Act, 2018.

This bill is one which we have been expecting, with the federal

government moving towards completion of the legislation to legalize

non-medical cannabis for use by Canadians. Bill C-45 is now being

debated in the Senate, and we await what everyone expects will be

approval sometime in the summer. So of course, every province, ours

included, will have to prepare for this new reality of a world with

legal recreational cannabis for use by the general public.

This is an issue that has been of great interest to my

constituents. Almost everywhere I travel around my constituency,

throughout Richmond, I find that folks have an opinion on this issue.

Many are quite concerned as we move towards a world with legal cannabis.

It’s reflected in the views of many in the community in Richmond, and

the local government of Richmond — quite concerned with how voters in

Richmond feel, the people of Richmond feel — have resolved that Richmond

will do everything that it can to not have cannabis freely available

within the confines of our community in Richmond.

So this is a topic that is on the minds of many that I encounter

in my riding. As I meet constituents in my office, around the community,

door-knocking, talking to them, many are concerned with what this means

for our families, for youth. In respect to what this means, this bill,

Bill 17, will endeavour to ensure that, with regard to public safety on

our roads, this is absolutely maintained.

Our previous government took steps to ensure that we had among the

most rigorous restrictions against drinking and driving across the

country, and I’m glad to see that this bill will continue with the

practice of immediate suspension — or IRP, immediate roadside

prohibition. This will be expanded under the act to include prescribed

drugs.

Cannabis will also be captured by this, and I think that is

something that we support. We want to ensure that, while some in my

community may not like this, we will do everything we can to ensure that

our roads are safe, our highways are safe, our community is

safe.

[1:45 p.m.]

Certainly, as the general public moves into this new world of

legal cannabis — that we can be assured, with proper laws and

regulations, that we can maintain public safety.

I just want to address a couple of points here. While I am

supportive of the general principle that we do need to regulate cannabis

use in driving…. I’m sure that in the committee stage of debate, some of

the specifics will be canvassed, and we will hear what the government’s

thinking is on some of the specifics. We want to ensure that the rules,

while firm, are also enforceable and that we will minimize or not have

the opportunity for people to be wrongfully accused.

I see that there will be in the legislation an evaluation officer,

who will be the expert, who will, at roadside checks, be able to

ascertain, based on training and expertise, if a driver is under the

influence of THC.

One can use one’s imagination to think that with more and more

opportunities for people to be exposed to those using cannabis that

secondhand smoke from a cannabis device or a toke would potentially….

Secondhand smoke would be consumed by someone not participating in using

the cannabis.

How will we ensure that someone who has been in a room where

there’s a lot of use of cannabis, a smoke-filled room, and then is the

designated driver, for example, and drives friends home. And then is,

you know, facing a roadside check. How does that work out? How would

that work out? We want to ensure that people are treated

fairly.

Of course, we want to ensure that the government puts in place the

resources so that we do have properly trained evaluating officers who

can help to help our law enforcement to ensure that our roads are

safe.

I think that the general approach of this bill…. We will canvass

some of the specifics in committee stage, but this is a bill which we

support. We do, again, want to emphasize that — I’m speaking on behalf

of many of my constituents, who are very concerned, as we move into this

world with legal cannabis — we will do everything we can to ensure that

the community is safe, that public safety is maintained, that our roads

are safe and that we have the tools, the rules and the enforcement to

make sure of that.

That is something that…. I find I have to reassure more and more

of my constituents who are concerned as cannabis is about to become

legal. This bill, we hope, will fulfil that requirement. We can assure

not just folks in Richmond but across our province that we’ll ensure

that public safety will be maintained.

I appreciate the opportunity to share some thoughts on Bill 17,

which we support. I look forward to the opportunity to get into a little

more detail as we go to committee stage of debate.

With that, I will take my seat.

D. Clovechok: It’s an honour to stand here in this House today, a representative

of the safety of the people that I represent in Columbia

River–Revelstoke, and also speak to Bill 17. Of course, it’s top of

mind, as my colleague just mentioned, in my riding too, around public

safety and how that’s all going to unfold and unravel.

Also, a big concern for me is around police safety. We’ve got to

make sure and ensure that that’s there. We’ll talk a little bit about

that.

[1:50 p.m.]

I also want to start off by saying I support the intention of this

bill. It’s a good one. It’s a bill that will make sure our friends, our

family, our colleagues, our neighbours and everyone else are safe on our

streets and that people that are under the influence of marijuana aren’t

getting behind the wheel and endangering themselves and

others.

I want to say thanks to the minister for his time and, always, his

willingness to have joint meetings. Yeah, you got that. This bill is

just one….

Interjection.

D. Clovechok: Well, there you go. I mean, you guys are fun over

there.

Interjection.

D. Clovechok: Exactly. You’re on it. Good.

Bill 17 is part of a suite of legislation, I’m sure, that’s going

to come around, in terms of this. But after reviewing this legislation,

I do have some overarching questions, maybe even leading to some

concerns.

To begin with, I’m relieved that the government is taking this as

seriously as they are. I think even the most passionate of marijuana

advocates would be open and understand that it’s dangerous to get behind

the wheel impaired on any substance, including marijuana, and that

certainly does impair drivers.

It wasn’t long ago that we were relatively ignorant around alcohol

abuse and driving. It has taken us a long time as a society to get to

where we are today, around the vision that people shouldn’t be drinking

and driving. Groups like MADD, and so on and so forth, have done an

amazing job. We have to make sure that the same applies to marijuana,

that we have that same kind of exposure and that same kind of

support.

Cannabis and driving is going to change the environment associated

with driving impairment. There’s no question about this. To this, the

concern that I have is that we are rushing ahead, I think, without

giving police the adequate resources and tools and training that they

need. Certainly, I recognize that this is not necessarily the provincial

government’s bailiwick. It’s a federal government issue, and I’m sure

that some of the things that the feds are doing are making you want to

lose your mind. Nonetheless, I know you’re going to get through

that.

In my humble opinion, the federal government is rushing forward on

this process without giving the provinces the tools and the money for

those tools that we need to deal with the daily ramifications of this

legalization of marijuana, specifically around the police.

This bill is a good example of that. So let’s envision a police

check somewhere in B.C. and the sequence of events that will happen to

you if you happen to go through one. Currently drivers, if you’re going

through a stop check, will roll up and speak to a member, and that

member will have a brief, hopefully, interaction with you and a polite

interaction with you and determine that you’re not driving under the

influence. You’re in there for a short delay, and it’s for a good cause,

so most people don’t mind doing that. Most of the members that I know

are very, very professional and polite about that.

If a member suspects that the driver is under the influence,

they’re going to be required to take a standardized field sobriety test.

That is an SFST, which consists of some preliminary questions, an eye

exam and some motor tests, movement tests, just to see and determine, on

that road, if that individual is impaired.

If the sobriety test indicates impairment by drugs, the driver

will be arrested and taken to the detachment — I use a detachment

because that’s where I live, in an RCMP area — to be evaluated by a drug

recognition expert, a DRE. The DRE will either gather a saliva test or a

buccal sample, which is a cheek swab, to determine. It’s technical, and

this is part of the training that these people are going to need to have

in order to make those conclusions.

At the conclusion of that DRE evaluation, if the DRE member has

formed an opinion that the person’s ability to operate a motor vehicle

is impaired by a drug category, then a demand for a urine or blood

sample will be made, and that will have to be provided. It all goes from

there into the forensic labs and so on.

The concern I have is that I hope police departments and

detachments across the province will be given all the testing equipment

and training to use it as soon as possible. I think it’s incumbent on

any government in this country, including, obviously, the one here in

British Columbia, to make sure that every police member in this province

is trained so they are clear about what they can do, and they’re clear

about what they cannot do with the new scenarios that marijuana is going

to present to them on a daily basis as they’re out in the field

working.

[1:55 p.m.]

My experience with the RCMP, generally speaking, is that they’re a

force that always is ahead of the curve, but they’re still going to need

help. That doesn’t mean that the other police services throughout

British Columbia aren’t going to need that same help.

Members are already demanding this training — I’ve heard that from

my own detachment — to make sure that they’re not doing the wrong things

as they uncover what will be a legal substance, which is now “illegal,”

and are also able to conduct investigations in a very proper

manner.

We can only assume that there will be one expert at most check

stops, available at a stop. If he or she is engaged with a driver, then

there’s going to be excessive waiting lines. If you’ve ever been through

a check stop and have manned one of those check stops, you realize that

the traffic does back up. If there’s only one trained officer on site,

it’s going to take a long time to get people through, especially if

they’re suspected of doing that.

Obviously, that member may be taken from the detachment. As the

previous member earlier on today mentioned, there’s overtime issues and

all that sort of thing associated, so there are some real financial

consequences behind all of this as well.

It’s my understanding that the ministry is planning to increase

the number of officers trained to administer field sobriety tests, as

well as drug recognition experts. I support this. I completely support

this, but I’ve got to ask, first of all, where’s the funding coming

from, which is a fair question.

I would really like to know what the per-member training cost will

be. How many members are planned on being trained, and what is the

timeline for that training?

I also have some concerns about consistency. Obviously, our

constitution protects the rights of people. Drug recognition experts are

human, and mistakes can be made. I’m not sure they won’t have any

problems identifying somebody who is on drugs or alcohol or they won’t

have any problems identifying those who aren’t, who are

sober.

Everywhere with marijuana is somewhere in the middle. It’s a bit

of a grey area, and it’s subjective. It will become subjective, based

upon that member.

This is why we have breathalyzer tests for alcohol. They’re

scientifically proven, and they work. That’s why they’re administered

for objective evidence, because when you take a charge to the Crown, you

certainly want to make sure that that charge has every chance of

succeeding.

This is too important to leave to subjective evidence, by

definition, because it varies from person to person. Each person

metabolizes alcohol differently. Each person will metabolize marijuana

differently and ingest the THC.

If somebody loses their driver’s licence because they failed a

breath analyzer, that’s one thing. When subjective judgment comes into

play, to me, that feels like a recipe for lawsuits and a significant

increase in Crown files and the jamming up of our court system. So there

are some issues there.

There are aspects of this legislation I’m happy to see, including

zero tolerance for any presence of marijuana for drivers in the

graduated licensing program. Completely supportive of that. We all know

that this makes sense with alcohol, so why wouldn’t it make sense with

marijuana or any drug, for that matter?

I’m sure members will recall the story of Ross Rebagliati. After

winning the gold medal in snowboarding, he tested positive for marijuana

and swore that he was just sitting around while other people were

smoking it. That can happen. That can happen.

I hope that nobody loses their licence because trace amounts were

detected from being exposed to secondhand smoke. It’s not like, as the

member before this morning said, when you’re sitting in the back seat of

a car having a beer. That doesn’t affect the driver,

whereas somebody

smoking a joint in the back seat will.

How will drug experts recognize this? If a designated driver goes

to a party and smells like marijuana smoke because their friends have to

use it, what happens to them? Do they receive a criminal record? What

will it do to their driving record? Will they be able to get into the

United States? So these are some serious, serious questions that we have

to ask.

I’m certainly not suggesting in any way, shape or form that we

give anybody a free pass or a free ride around impairment. But we have

to make sure that the punishment fits the crime, especially if the

threshold is subjective.

[2:00 p.m.]

There are lots of questions. I look forward to the committee stage

of this, because I know I’m going to be participating in it. But as I

mentioned before, I am going to be supporting this bill and thank the

minister for his efforts as we move forward with this.

R. Sultan: I’m glad to contribute my meagre knowledge on the subject of

cannabis to this erudite debate. I will confess up front that my

knowledge of cannabis and motor vehicles relates to a Cheech and Chong

movie I saw about 30 years ago, as a van which seemed to be fabricated

from marijuana plants was driving across the border between Mexico and

California and somehow caught on fire, which, in turn, caused the entire

border guard staff to become, shall we say, impacted.

Anyways, it was a great flick. But that was the extent of my

sophisticated knowledge on the subject on which I’m asked now to pass

laws which will perhaps result in criminal records, which will create

great complications for our citizens. So I would caution that we should

tread lightly before we put the fate of the records of so many citizens

in the hands of somebody whose knowledge is limited to Cheech and

Chong.

With that precaution, let me just point out some issues I see in

section 3 of the bill. If I could interpret the remarks of my colleague

who proceeded me,

section 3(c)(2.1)(

b) suggests, to quote the law, that

the peace officer “has reasonable grounds to believe, as a result of the

analysis, that the driver has a prescribed drug in his or her body….” I

presume that is, in fact, what the preceding member referred to as a

zero-tolerance rule.

At least, that’s how I would interpret it. Nada. Nothing. One

molecule — that will do it. Perhaps that is necessary when our knowledge

of the true impact of this substance in the human body is based more on

Hollywood movies than upon science.

I also see, moving along to subsection 5(d)(a.1) of the bill, that

the “analysis of the blood of a person” — so suspected, I presume, I’d

interject — “within 2 hours after ceasing to operate a motor vehicle, a

blood drug concentration equal to…,” etc.

In other words, we begin now to arbitrarily set measurement limits

— but, I rather suspect, on the basis of somewhat sketchy science. Let

me also concede to the Solicitor General, who has brought forward this

bill, that he’s been given a very awkward assignment indeed. Knowing how

conscientious and competent he is, I regret that he’s been thrown this

curveball from way out there in Ottawa, saying: “Get ready. It’s coming.

We need some sort of a law on the books.”

This is probably the best the most erudite legal scholar in the

world could have come up with in the time in which he has had to

operate. Indeed, perhaps this is about as good a law as the best and

most thoughtful Legislative Assembly could come up with in the very

limited time available. But that does not excuse these rather arbitrary

time limits under which we are operating, on a subject of such deep

importance. I refer to all the ways in which we can contrive to run

over, run down and even kill one another on the highways.

[2:05 p.m.]

I’m indebted to my colleague from the Green Party pointing out

that we are talking about a substance called THC. Reference to my iPhone

educates me to the full word: tetrahydrocannabinol. This is all about

cannabis. We also seem to be quite capable, in this province, of running

over one another through the mere use of that iPhone through distracted

driving.

Alcohol. Again consulting the dictionary, we see that about 65

people a year are killed through inebriated driving in British Columbia,

roughly one a week. We kill about one person a week through drunk

driving, impaired driving through prescription drugs and a combination

thereof. We have not yet to enjoy the experiments with driverless

automobiles, but those vehicles have been able to knock off a few people

as well, although we are assured that, in the long run, they will cut

the accident rate by about 80 percent. Actually, I have faith that they

will.

As I indicated at the outset, I think our Solicitor General has

been forced to take on this complex assignment based upon some political

promises made in another jurisdiction, the federal government in Ottawa,

which seems bound and determined to make the distribution and

consumption of cannabis legal, if my reading of the popular press is

accurate, sometime in July — in other words, about ten weeks from now.

Ten weeks from now we are expected to have a fully functioning legal

apparatus for the control and safe conduct of traffic on our streets,

surrounded by the uncertainties I’ve already alluded to.

One of our political leaders referred to all of this not so long

ago as “unfortunate,” and I truly think it is — to be asked, as a junior

government in this confederation, to come forward with a workable regime

that our law enforcement officers, our municipalities and our own

provincial government itself can cope with. It is my observation and my

impression, at least, that the police are not ready and the

municipalities are not ready. Certainly, we in this Legislature are

taking some initial steps, but only initial steps, to get ready. The

bill itself, I’m sure, could stand lots of scrutiny and fine-tuning and

improvement.

Certainly, I would suggest, the U.S. border regime is not ready.

Let me report my recent experience visiting my kids down in Vermont,

driving down, as I usually do, late at night at Christmastime. At a

border station, where usually you drive through with a very casual wave

of the hand, eight Homeland Security guards in full uniform, with full

sidearms, were dealing with one lonely Canadian. I was the only person,

I think, showing up in about an hour.

This is the border regime we are now facing with our friends in

the United States. If we show up and say, “Oh well, I had a few joints,

but don’t worry about it….” Well, I hope they’re not showing up at

midnight at that border station south of Montreal with eight Homeland

Security officers there trying to figure out some way to use those

sidearms. It is chilling, yet we will be exposing people who perhaps do

not have the full benefit of education and advice to these risks as they

attempt to go into the United States, where, as I understand it,

federally, it’s still illegal.

I compliment the Solicitor General for doing his best. I’m sure

few people could do as well in the time that he has had. I also lament

being forced into this situation by a senior government that is asking

us to do almost the impossible, which is to overnight invent a judicial

and enforcement regime which hardly exists notionally, let alone in

detail.

[2:10 p.m.]

Training not yet conducted. Police budgets not yet adjusted.

Goodness knows where the budgeting for all of this is going to sort out.

I will not make any wisecracks about municipal budgets. There’s a lot of

unfinished business with this law. I will go along with my colleagues on

whether we support this flawed piece of legislation reluctantly, as we

really have few alternatives but to embrace it. I think it is very

unfortunate that this Legislature has been forced into a situation with

a ten-week deadline and so many unanswered questions.

Deputy Speaker: Seeing no further speakers, the minister will close the

debate.

Hon. M. Farnworth: I want to take this moment to thank members for participating in

the debate and for raising some important questions, because there is

still a considerable amount of uncertainty. My colleague from West

Vancouver is absolutely correct. This legislation is required because of

decisions being made in Ottawa. We have to have it in place even though

we don’t know yet what the final bill that Ottawa is going to pass will

actually look like. That’s a real problem not just for British Columbia

but for provinces right across the country.

Previous members on both sides have talked about the issue with

police and training. Those are of critical importance. Police chiefs

have said: “We don’t have enough time.” We have made it clear as a

province, in our discussions at the federal-provincial-territorial

tables, that Ottawa is imposing this, and they need to put in place the

funds the provinces need in order to do the training that needs to

happen so that officers are trained and we can get as many trained ahead

of time as is possible. That has started. I am pleased, at this point,

where we are in British Columbia in terms of that training. In fact, I

think we are ahead of many of the provinces, but there is a lot of work

that still needs to be done.

The issue of funding, the issue of training, the issue of

readiness is crucial. We still don’t know the date of when legalization

is actually going to take place. We know that there is an agreement on

Bill C-45 to be out of the Senate by June 7. There may still yet be

amendments to that piece of legislation. We don’t know. But once that

bill is out, the provinces are still going to need time to look at the

bill as it is and the regulations that will flow from that bill and be

able to prepare for legalization.

My expectation is it will be sometime later this summer. It will

not be July 1. I’m hoping it’s later, into September or October. The

later, the better, frankly — the more time we have. But that’s just one

aspect, one part. Then C-46, which is the bill that is in essence what

is giving life to us to deal with this piece of legislation…. We still

don’t know exactly when that will be out of the Senate, and we still

don’t know exactly what the technology is going to be.

There are existing rules in place — those will continue to be in

place — around drug-impaired driving and alcohol-impaired driving.

They’re still there, but the reality is that when the federal government

indicates to us that there is new technology that’s coming…. The sooner

we know what it is, the better and the more we’ll be able to make sure

that when legalization does happen, we are as ready as is

possible.

I also want to quickly touch on, before I finish my remarks…. We

can get into the nuts and bolts of the legislation a lot more during

committee stage. I think it is one of the great, little-known issues

that we are going to be facing. In this whole discussion around

cannabis, it’s amazing how many issues it has brought to the surface

that need to be addressed.

What the member described as his experience at the border in

Vermont is, I fear, going to have a significant impact, particularly

here in British Columbia. Cannabis will be legal in B.C., and it will be

legal in Washington state and Oregon and California. People are going to

naturally assume, on either side of the border, that they can cross back

and forth because it’s legal in each jurisdiction.

[2:15 p.m.]

The reality is it will not be legal at that federal border

crossing, the U.S.-Canada border crossing. It is U.S. federal

jurisdiction on their side, and it will not be legal. They have already

indicated to us — we’ve raised this with the U.S. consular general; it

has been raised at the highest levels in Washington — that they have

absolutely zero interest in dealing with the problems that are going to

arise. They’ve told us that in no uncertain terms.

So you are going to have the potential of ordinary citizens, who

are doing something legal in this country and in this province, crossing

the border and having to answer a question, and if they reply

truthfully, they can be denied access. They potentially could have their

vehicle seized, fines, you name it. And likewise, people coming up from

the United States.

What is it going to mean, for example, if you have a business that

does a lot of work in the U.S., and you have an employee that’s going

down there and, on their own time, they’re doing something, again, that

is perfectly legal in Canada, perfectly legal in Washington state, but

at the border, it’s not?

There are some very important, unanswered questions, in terms of

you as a private individual or you as a business, whether it’s a small

business or a large business. There are some significant issues that we

still are going to have to deal with, and we’re going to have to deal

with them with our largest neighbour next door to us — our largest

trading partner, who has already told us: “We don’t care. It’s not a

priority for us.”

I just want to flag that, because there is going to have to be a

lot of education done around that. I think it’s a little-known

consequence of what is, in fact, taking place with

legalization.

I’ll just leave that there. I wanted to get that on the record,

because I think it’s important. We’re going to have to have some

important discussion on that issue, as a province and as a

country.

I want to thank members from all parties for participating in the

debate. Many of the key questions that they have asked, we will be

addressing in committee stage of the bill.

With that, I move second reading.

Motion approved.

Hon. M. Farnworth: I move the bill be referred to a Committee of the Whole for the

next sitting after today.

Bill 17, Motor Vehicle Amendment Act, 2018, 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. M. Farnworth: I call second reading and debate on Bill 29, the Voluntary Blood

Donations Act.

BILL 29 — VOLUNTARY BLOOD

DONATIONS

ACT

Hon. A. Dix: I move second reading of Bill 29, the Voluntary Blood Donations

Act. I think it’s fair to say that this legislation, while it has a

number of provisions, is based on a simple proposition. It prohibits —

subject to certain exemptions, which will be understandable and which

we’ll, no doubt, discuss at committee stage — payment for blood

donations.

I think that Canadians and British Columbians, surely, are proud

of our public health care system. For decades, it has provided care for

people. It’s a treasured national resource. We all know that. I think

there’s a consensus of that in Canada. We understand its value to

us.

Occasionally, when we forget its value, I think it’s useful to

talk to people who are now seniors, who lived in Canada prior to the

advent of our public health care system — and the economic threat to the

health and well-being of ordinary people that came from a system that

was not universal — who did not have the access to services we

have.

A very important part of that, at a practical level, is a publicly

owned and operated blood supply system. Canadian Blood Services is

Canada’s supplier of blood and blood products, including plasma, which

is one of the subjects of our discussion today. It’s a non-profit

corporation. It’s made up of a board appointed by provincial and

territorial Health ministers. The majority of the funding for its

operations comes from provincial governments. Our government, for

example, invests $180 million per year on a system that we all rely on

and benefit from.

[2:20 p.m.]

It’s in our collective interests, it seems to me, to prevent the

blood supply from being threatened or reduced by competition from a

private, for-profit market.

People make donations to help others live. It’s a selfless act

that ordinary people make every day in virtually every community in our

province and in our country — people from Golden, Revelstoke, Kelowna,

Richmond, Abbotsford, Saanich and Surrey every day committing that

selfless act that helps others live. It’s one of the most important

things that binds people together.

I personally, as people may know, have type 1 diabetes. I gave

blood until I was diagnosed with that, and because of that condition, I

can’t give blood. I regret that, although I gave many times before I was

diagnosed in my 20s. But I think it’s that act that brings Canadians

together. They’re coming together in common cause to help one another in

an ordinary way and an extraordinary way.

You can go to a Canadian Blood Services clinic, roll up your

sleeves and provide something invaluable — the gift of life. We all have

that opportunity. Since I can’t, I encourage all of you to take up that

opportunity. It’s why, I think, this legislation is so important. It was

developed to protect our investment — both our personal investment, in

many cases, and our collective investment in Canada’s publicly owned and

operated blood system.

You will know that paid plasma clinics have opened in Saskatchewan

and New Brunswick, and there were attempted openings in Ontario prior to

the introduction and passage of legislation parallel to what we’re doing

today. These clinics have been established by a private, for-profit

company based in Ontario, and the company has expressed interest in

opening a paid plasma clinic in B.C.

There is currently no legislation in B.C. to prevent these clinics

from operating here. Unless B.C. moves ahead with legislation to ban

payment for plasma, private clinics such as those in Saskatchewan and

New Brunswick could be established here in the near future. That will

have consequences for our public health care system and for our publicly

supported and operated blood supply system.

The prospect of paid plasma clinics opening in B.C. is a

significant concern to Canadian Blood Services. Canadian Blood Services

is responsible, as I said, for managing the national blood supply, and

it’s funded by all the provinces and territories in Canada except in the

province of Quebec, which has its own system. Canadian Blood Services

points out that private paid plasma collection competes with CBS for

donors and will negatively impact volunteer donor recruitment. That has

certainly been the case and had an impact on the quality of donor

recruitment in the province of Saskatchewan.

Private paid plasma collection does not contribute to Canada’s

plasma self-sufficiency, since private companies sell plasma on the open

global market to the highest bidder. It’s important to understand that

plasma used for transfusion is something we are self-sufficient in, in

Canada. Some plasma is used for the creation of course, importantly, of

what are essentially pharmaceutical products which we need and import to

Canada.

For these reasons, Alberta, Ontario and Quebec have already

enacted legislation banning payment for the collection of blood and

plasma. The Voluntary Blood Donations Act I am speaking to today in this

House would do the same. The Canadian Blood Services, as operator of the

national blood system, will continue to be the only collector of blood

and plasma in B.C. and, along with the provincial government, is exempt

from the legislation. Those utilizing blood and plasma for health

research are also exempt.

The legislation will protect the voluntary donor base from erosion

due to competition — this is important — and will ensure that plasma

collected in B.C. remains in the Canadian system for use by Canadian

patients and not sold to the highest bidder. The legislation will not,

on the other hand — the obligation is on those that might provide or pay

for services — penalize individuals for receiving payment for blood or

plasma.

Based on information from other jurisdictions, we know…. It’s

immortalized, of course, in song. We know it is often vulnerable,

low-income individuals who are targeted by companies paying for blood or

plasma. These individuals, of course, should not be penalized for their

actions, should that occur contrary to the law.

[2:25 p.m.]

I want to acknowledge the significant role my colleague the

Minister of Mental Health and Addictions, the member for New

Westminster, who introduced in the past private member’s legislation on

this subject, has played in its development.

It’s for all of these reasons why groups such as the Doctors of

B.C., the B.C. Health Coalition, the B.C.

chapter of the Canadian

Hemophilia Society, Bloodwatch, our own health authorities all support

this legislation. It’s because it makes sense, because it protects our

public blood supply. It ensures its safety, but it also ensures its

long-term future, something that’s essential, it seems to me, to our

public health care system. It’s also why, internationally, the banning

of paid blood donations is opposed by the World Health Organization;

organizations like the EU, in terms of policy; the International Red

Cross; and the international Red Crescent Society.

Well all know, because many of us have a memory of these moments

in our history, that the moments that led to the creation of the Krever

inquiry and the Krever commission were some of the most difficult

moments for governments in Canada and for our public health care

system.

Mr. Justice Krever went through a multi-year process, assessed all

of the evidence and made recommendations on which our current system is

based — recommendations that were both farsighted, it seems to me, and

profound. He concluded that blood is a public resource. He concluded

that donors should not be paid. He concluded that sufficient blood

should be collected so that importation from other countries is

unnecessary. He concluded that access to blood and blood products should

be free and universal and that the safety of the blood supply system is

paramount.

This piece of legislation, Bill 29, is consistent with what Mr.

Justice Krever said in the 1990s. It’s consistent with our understanding

of how the blood supply system works. It’s consistent with the

recommendations of Canadian Blood Services. It’s good legislation. It

ensures that we do not run into this problem in British Columbia — that

we ensure a publicly supported blood supply system — and that a public

blood supply system continues into the future.

Thank you very much. I ask all members to support the

legislation.

N. Letnick: Thank you to the Minister of Health for his words. Let me at the

outset say that the opposition will be supporting the bill. However,

through the process of committee stage, we have a number of questions,

concerns, issues, clarifications, maybe even amendments that we might be

proposing to ensure that the act is in the best interest of all British

Columbians, as I’m sure the minister would like to achieve.

We, on the opposition side of the House, support the publicly

funded health care system. Let there be no question on that. We also

support making sure that what we do in this House is something that the

average British Columbian can understand and see the reasons why we came

to our conclusions.

[L. Reid in the chair.]

With that, what I’d like to do for the minister and for those who

are watching — because I’m sure this is of interest to a few people out

there, especially those in the industry — is to articulate some of the

background to this piece of legislation that we believe is important and

also some concerns that I’ll articulate in the second-round debate and

then probably bring forward at the appropriate time during the committee

stage.

We support voluntary donations of both whole blood and plasma.

Government works very closely with Canadian Blood Services and in 2017

funded Canadian Blood Services to the tune of about $180 million. In

Canada, blood use for transfusion is collected solely by the Canadian

Blood Services or by Héma-Québec and only from volunteer

donors.

The safety of Canada’s blood supply is a federal responsibility.

It falls to Health Canada. Health Canada currently has an expert panel

reviewing the entire issue of paid plasma, and the panel’s report is

expected by the end of May.

[2:30 p.m.]

The decision as to whether plasma donors can be compensated rests

solely with the provincial government. For those who don’t know — and I

didn’t know this prior to studying up for this bill — plasma is the pale

yellow liquid component of blood that normally holds the blood cells in

suspension. It makes up about 55 percent of the total volume of the

individual’s blood.

Plasma donation is the process of collecting a donor’s blood,

separating the plasma portion of the blood from the blood cells and then

returning the blood cells to the donor. This process takes about two to

three hours.

Commonly used plasma products include albumin, which is used to

treat fluid loss in burn or trauma patients; immunoglobulins, which are

used to treat or prevent infections or immune disorders; and clotting

factors, which are used for the treatment of hemophilia as well as other

bleeding disorders.

The body can replace plasma in about 24 hours. In Canada, donors

are permitted to donate weekly. This is different from your average

blood donation that I imagine many of us contribute — those that are

able — where we are asked not to donate for about two months between

donations.

The plasma that CBS collects, our provincial and national agency,

only meets about 17 percent of the need for intravenous immunoglobulins

in Canada — only 17 percent. About 70 percent to 80 percent of the

life-saving plasma proteins that are used by Canadians come from foreign

sources, which, in the majority of cases, are from paid United States

donors.

Canadian Blood Services says: “The plasma industry’s experience

over the last three decades shows that drugs made from plasma donated by

paid donors are as safe as those made from plasma donated by volunteer

donors.”

Health Canada says: “Paying people to donate plasma in Canada is

not new. It does not represent a change in policy or practice in Canada.

A company in Winnipeg has been operating safely and paying donors for

plasma for 30 years.”

Any establishment that collects plasma for use in making plasma

products must be licensed by Health Canada. The licence application must

show that its donor screening and testing processes meet the strict

requirements under the law.

For example, before donors are accepted into a plasma donation

program, they must be determined to be eligible to donate. In addition

to a comprehensive questionnaire and interview, donors must be

physically examined for health and disease risk factors.

At the time of every donation, donors are re-interviewed, and

their blood is tested for infectious diseases, including HIV, hepatitis

B and hepatitis C. Before a licence is granted, Health Canada inspects

the establishment to ensure that it is meeting the safety standards set

out under the Food and Drugs Act. The establishment is then inspected

annually to assess that it is following the law.

Health Canada will take compliance and enforcement actions for

establishments that are not meeting these requirements, which could

result in the loss of their licence. Furthermore, all plasma products

are subjected to an additional regulatory review before they are

authorized for distribution in Canada. This regulatory review includes

careful examination of the plasma collection and product manufacturing

processes.

Health Canada’s stringent regulatory oversight serves to

complement the global standards that plasma collectors must adhere to,

as set out by the Plasma Protein Therapeutics Association, or PPTA. As

part of the PPTA’s international quality plasma program certification

criteria, plasma collection facilities must verify that prospective

donors can provide proof of a fixed residential address within a set

proximity to the collection centre and which is checked against a list

of transient temporary residences to exclude donors who may be part of

some higher risk populations.

Potential donors must also give two donations with negative

disease test results before they are considered qualified, and for

donors who do not return for their second donation, the plasma from the

first donation is destroyed.

Health Canada says that there is no evidence that paying plasma

donors compromises the safety or weakens the country’s volunteer blood

donor system. Paying people to donate plasma in Canada has not weakened

Canada’s blood system or the volunteer donor base, and there’s no

evidence that it will. This system is completely voluntary and remains

so.

Evidence has shown that the U.S. and other countries with paid

plasma donation sites have some of the highest voluntary blood donations

in the world. For example, the blood donation rate of 57 to 58

volunteers per 1,000 people in Germany, Austria and the United States,

which have paid donation, is nearly twice Canada’s rate, at 36.6 per

1,000.

In their report to the Saskatchewan Minister of Health, Canadian

Blood Services offers this

summary of their experience in Saskatoon and

Saskatchewan since the opening of a private plasma clinic operated by

Canadian Plasma Resources, or CPR.

[2:35 p.m.]

I bring up Saskatoon and Saskatchewan for the minister. I also

made attempts to contact New Brunswick and Manitoba, who also permit

private paid plasma, but I have not heard any information back from

them. I did get information back regarding Saskatoon. The information

from the Canadian Blood Services in Saskatoon is that donation frequency

has levelled off and remains fairly constant year over year.

“The donor base has increased at this site,” the site in Saskatoon

where the private clinic is, “in the past few months, bringing it to

above the March 2016 donor base numbers. This is due to increased new

donor acquisition year over year. The lapsing results are only visible

after 12 months. Since March is the first month we are able to compare

lapsed donor information, it is still too early to form any definitive

conclusions. We will need to continue to monitor this program.”

The last bit they say in the introduction

is:

“The 17- to 24-year-old segment is experiencing a double-digit

decline at the Saskatoon site. This could be attributed to CPR,” or

private facility, “and the demographic they are targeting for

recruitment. This trend is not reflective of national and regional

trends for the same age cohort.”

The report goes on to say that, specifically, CBS reports a 35.8

percent increase in new donors April to March 2017 over 2016 for

Saskatoon, where the new CPR site is located, and a 15.7 percent

increase for the rest of Saskatchewan.

The report concludes that “further analysis on the first…year of

CPR operations does not seem to show any clear indications of CPR

impacting Saskatoon’s collections performance. New donor numbers

continue to increase month over month, and collections are remaining

steady, with a slight increase year over year. Evidence does point to a

drop in involvement of the critical 17 to

24-year-old…segment.”

“Taken together, the brand confusion between Canadian Blood Services

and Canadian Plasma Resources and the early indicators of performance

degradation within the 17-to-24 age bracket suggests the need for

heightened vigilance on this matter. Further analysis will continue to

be conducted on a quarterly basis.”

From the Saskatoon Star Phoenix , Jonathan Charlton

published an

article in 2017, in April, that says:

“It’s essential there is enough plasma product for Canadians. A

disruption at the U.S. border would be tragic for people who rely on

plasma products. The Krever inquiry indicated support for paid plasma

donation in certain circumstances. Justice Horace Krever, head of the

commission of inquiry, recommended ‘significant efforts be made to

ensure that blood components and blood products used in Canada are made

from the blood and plasma collected from unpaid donors.’ He also said a

strong effort should be made to achieve self-sufficiency in plasma

within a limited period.

“Krever expected self-sufficiency for the Canadian system to be

easier than in the past since most people with hemophilia no longer use

plasma-derived products. However, that hasn’t happened. Manufacturers of

some special blood products rely on a small number of donors, so ‘it may

be necessary to offer compensation to these persons for their time and

effort in order to attract a sufficient number of donors,’ Krever

wrote.”

CBC news in February of 2016 reported that the CEO of Canadian

Plasma Resources says: “Plasma donations take three times longer than

regular blood donations, making a small donation important. In our case,

all cells are returned to the donor,” he said. “Only plasma, which is

water, and proteins are kept. We do a saline infusion at the last cycle

of the process so the donor doesn’t feel dehydrated.”

Health Canada says: “If Canadians didn’t have access to products

that are currently made from plasma from paid donors, the health and

lives of thousands of Canadians who rely on their life-saving properties

could be at risk.”

The International Federation of Red Cross Societies, whose global

framework for action states very clearly: “Paid donors are vulnerable to

exploitation and commercialization of the human body as they…become paid

blood donors due to economic difficulties.” “The need to protect their

income they receive…compromises issues of honesty in the donor

interview, and they are unlikely to reveal reasons why they are

unsuitable to donate blood.”

[2:40 p.m.]

In their policy statement on paid plasma donations, the Canadian

Hemophilia Society says:

“Canada, U.S. and other developed countries are identical in being

self-sufficient in fresh blood components from non-paid donors and

almost totally reliant for the supply of plasma-derived products on U.S.

paid donors.

“There are currently no serious strategies in place around the world

to reverse this situation. The demand for life-saving plasma-derived

products is increasing faster than the growth in the whole blood

collection — and, therefore, recovered plasma. Not-for-profit blood

establishments do not consider it economical to recruit non-paid donors

for a self-sufficient supply of plasma for plasma-derived products. They

choose to rely on the highly efficient for-profit global plasma

collection and fractionation industries. Therefore, the reliance on

source plasma from paid donors will only increase.

“In the absence of any realistic strategy to significantly increase

the Canadian contribution to the world supply from non-paid donations,

and when Canada relies almost entirely on paid donors from the U.S. for

life-saving plasma-derived products, it is not defensible to reject paid

donor practices on ethical grounds.”

We will support the legislation because we believe it’s the right

thing to do, given all these different opinions on both sides of the

issue. But we do have serious questions about the government’s plan to

make sure that we have a sustainable, viable, publicly funded collection

system for plasma in Canada, particularly in British Columbia. I think

it’s unconscionable that we should continue to rely on the United States

to supply our plasma for use in this country.

We will be posing some very difficult questions to the minister at

the time of committee stage to see what the minister’s plan is — that

the government currently funds, as he said, the majority of the needs

for Canadian Blood Services and what their plans are to make sure that

we have a path forward to ensure we have a strong, publicly funded

health care system with a strong, publicly funded plasma collection

system in this province.

S. Furstenau: I rise to speak to Bill 29, Voluntary Blood Donations

Act.

This Voluntary Blood Donations Act makes it an offence to offer

payment for donating blood or any of its components. Currently the

Canadian Blood Services, or CBS, is responsible for blood-related

services in most of Canada as a non-profit. It has not historically

offered remuneration for donations.

It is important to note that CBS has been identified in this bill

as exempt from the prohibition of compensating donors. This legislation

creates a pre-emptive move that guarantees that CBS will remain the

primary blood provider in British Columbia.

I agree with the minister that CBS is the proper agency for

collecting and managing our blood supply. What I think must be

highlighted, however, is that we have a long way to go for CBS to have a

truly resilient blood and plasma supply that will be able to fully meet

the needs of our citizens. And this means that our investment into CBS

has to increase so that the infrastructure and capacity of this agency

can be brought to a place where it does produce a resilient blood and

plasma supply for all of our citizens.

Right now Canada is only self-sufficient in approximately 17

percent of its plasma production. The majority of plasma products are

imported from the United States, where most of the donors for plasma are

paid.

Safety is not a concern here. Access is. Many patients depend on

these products not just for their quality of life but for their very

survival.

CBS has stated that it is committed to increasing our plasma

self-sufficiency. However, I am concerned that this legislation

addresses one aspect of our blood and plasma collection system without

turning attention to the greater need of how B.C. will be building a

sustainable, self-reliant blood and plasma collection and distribution

system.

Health Canada intends to publish an expert report on public and

private blood providers in the coming weeks. It will be essential that

we consider the data and recommendations provided by this report in

moving forward.

Ultimately, we need to agree on the overarching goal, and it’s

essential that we move to a far more resilient blood service and supply

in B.C. and Canada and that we protect the needs of our citizens who

depend on blood and plasma for their survival.

[2:45 p.m.]

Relying on importing blood products makes us vulnerable in the

face of a crisis, in which other countries may limit the sale of their

blood and plasma products in order to fulfil their own citizens’

needs.

Similarly, we need to facilitate the development of CBS’s

infrastructure by working together with other provinces to provide

additional funding. The plan must be long term and focused on providing

accessible products to the patients that have the greatest needs. In the

long run, this endeavour would be cost-efficient, as we would no longer

have to rely on buying plasma products on the international

market.

I eagerly anticipate the steps that this government will take to

build and strengthen CBS so that we can ensure that patients across

British Columbia have the reliable access to blood, plasma and plasma

products that they need to survive.

Deputy Speaker: Seeing no further speakers, the minister closes debate.

Hon. A. Dix: First of all, thank you very much to both the Health critic for

the Third Party and the opposition Health critic for their contributions

and their support of the legislation.

I think this is an important step, but as they rightly note, it’s

not the only step. We have continuing work to do to improve the services

provided by Canadian Blood Services, of which the B.C. government and

all other provincial governments are partners. And we fully intend to

make that work happen in the coming days, weeks, months and

years.

What this legislation does is it essentially, fundamentally,

protects the public blood supply system in Canada and the public health

care system in Canada. I think it’s necessary legislation — not

sufficient to answer all of the questions but necessary legislation —

supported broadly by British Columbians, from the Doctors of B.C. to

Bloodwatch to the B.C. Health Coalition.

I ask the members to support this legislation.

Deputy Speaker: Hon. Members, the question is second reading of Bill 29, the

Voluntary Blood Donations Act.

Motion approved.

Hon. A. Dix: I move that the bill be placed on the orders of the day for

committee stage at the next sitting of the House after today.

Bill 29, Voluntary Blood Donations 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. C. James: I’ll call second reading of Bill 25, the Real Estate Development

Marketing Amendment Act.

BILL 25 — REAL ESTATE DEVELOPMENT

MARKETING AMENDMENT

ACT, 2018

Hon. C. James: I move that the bill now be read a second time.

Our government made a commitment, when we were putting together

our first full budget, to put people at the centre of every decision we

make. That’s the reason that when you take a look at the priorities in

Budget 2018, two of those key priorities are related to specific issues

— affordability issues and economic issues — that have been raised by

British Columbians for years in this province. The focus was child care

and housing. This bill speaks to one of those housing measures as part

of our 30-point comprehensive housing plan.

There is no question that the housing issue in British Columbia is

a crisis. There is no question when you talk to individuals and families

and seniors. I’m sure every member in this Legislature has heard the

heartbreaking stories of people who can’t find affordable places to

live, who can’t find safe places to live. Every member went through the

election, almost a year ago now, and had the opportunity to be out in

their communities, door-knocking and talking to individuals. And I have

to say those were some of the toughest stories that I certainly heard

when I went door-knocking, where individuals….

In fact, I remember climbing up a flight of stairs, 3½ storeys, to

the top of a house where two young women who were in nursing school were

living. I knocked on the door, and we had a conversation about the

issues in the election. Then they told me about how dangerous the

staircase was, which was pretty obvious coming up; the deficiencies in

the suite they had; and the challenges they were facing — basically, the

difficult, almost unsafe conditions they were living in.

They weren’t going to say anything because they couldn’t find

another place to live. They were terrified that if they lost this place,

they were going to be in a situation where…. They were going to school

to be able to train for careers that we need in British Columbia, and

they weren’t able to even raise the concerns about their place because

they were so worried about what was going to happen.

A year before I had two seniors in my office who had been sleeping

in their cars. That’s the kind of situation and the kind of crisis that

we’re facing when we look at the issues in housing here in British

Columbia. We know that vacancy rates are at historic lows. Rental rates

are unaffordable.

[2:50 p.m.]

The housing crisis has to be addressed. It continues to be one of

the biggest issues that is raised by businesses across British Columbia.

When we talk about growing this long-term sustainable economy, we can’t

do that if businesses can’t recruit and retain employees because they

can’t afford housing in British Columbia. And we hear that from

businesses in every corner of our province. This is not simply a Lower

Mainland issue. This is a provincial issue.

I have always said that we’re not going to address housing

affordability overnight. There isn’t one simple tool that’s going to

address the crisis that has been left for a number of years. It is going

to take a suite of measures. That’s really what we’re bringing

forward.

I recognize there’s certainly been a lot of discussion about

housing in British Columbia over the last number of months, and I expect

that’s going to continue. I understand that not everyone is happy with

change, that there are some people who have benefited quite well from

the status quo and who have done quite well from the status quo. But it

is our responsibility as government, I believe — our responsibility to

the people of British Columbia and our responsibility to a long-term,

sustainable plan for our province — that we address the housing

affordability crisis in British Columbia.

I’m incredibly proud of the actions that our government has taken,

incredibly proud of the work we are doing. Not to simply sit back and

say: “Well, we’ll wait and watch. We’ll see how this one tool works.” We

actually put together a suite of measures, a 30-point plan, to address

housing affordability in this province.

Government doesn’t control all of the tools when it comes to

housing. We recognize that there are interest rates that impact housing

markets. There are changes to mortgage rules that impact housing

markets. But just because we don’t control all of the tools doesn’t mean

that we shouldn’t, as a government, get started in addressing this

issue. That is our responsibility.

In bringing forward Bill 25, we are continuing, as part of our

30-point plan, in addressing that crisis. This bill deals with

speculative housing demand by closing loopholes in contract assignments

in the condo presale market and cracking down on tax fraud. As many of

you in this House know already, the Real Estate Development Marketing

Act applies to developers who market new strata lots and other types of

development units in our province, and that includes presale

condos.

The act imposes consumer protection requirements on developers

before they begin marketing. For example, there are some things that are

required right now. Purchasers are entitled to receive disclosures about

the strata lot they are purchasing. The amendments in this bill will

require a developer to expand those requirements. It will require a

developer to consent to the assignment of a strata lot contract. It will

require the developer to collect comprehensive information about the

assignment before providing that consent, and it will also require that

that information collected gets transferred to the property transfer tax

administrator.

I think many British Columbians would be surprised to know that

that information isn’t already collected. I certainly was. I will say

that I think many of us believed that there was information there that

could be acted on. In fact, what we have learned is that that

information has not been collected. So this is the first step in making

sure, if further action is needed, that we take further

action.

Developers will also be required to include terms in their

contracts to inform purchasers of the new requirements, of the new

reporting requirements. And as I said, right now comprehensive

information on strata lot contract assignments isn’t available and isn’t

collected. The assignment information that will be collected and

reported to the administrator will be shared with the Canada Revenue

Agency and the ministry’s revenue division to be able to support federal

and provincial tax compliance and to make sure that people pay their

fair share of taxes.

Right now there isn’t tracking to determine that people who buy….

Often it’s referred to as condo flipping. That’s what you’ll hear people

talking about when we’re talking about presale condos. They’ll flip a

condo. It’ll be flipped two or three times before anybody actually lives

in it, and that value is going up each time it’s flipped. Well, the

individual has a responsibility to pay tax on that increased value.

Whether that’s happening or not right now, without the information,

isn’t clear. This will provide us with that assignment information to be

able to make sure that people do what people expect in British Columbia:

pay their fair share of taxes.

[2:55 p.m.]

The superintendent of real estate will enforce the developers’ new

collection and reporting requirements just in the same manner as they

deal with other requirements that are imposed under the act. The

superintendent also may investigate, may hold hearings and may order

non-compliant developers to actually cease marketing to comply or to pay

the costs or an administrative fine.

There are also some consequential amendments to the Income Tax Act

and the Property Transfer Tax Act that allow this information collected

under these statutes to be shared with the superintendent for the

purpose of administering and enforcing the Real Estate Development

Marketing Act.

These amendments will also strengthen the superintendent’s

enforcement tools and make some minor corrections. Investigations, in

these amendments, are also streamlined by allowing the superintendent to

appoint staff as investigators based on job titles and responsibility.

Investigators’ authority to demand information will be expanded to

include any person who is reasonably likely to have any relevant

information.

As well, I think it’s important to look at deterrence for any bad

behaviour. To prevent developers from simply treating fines as a cost of

doing business, maximum fines for administrative penalties and offences

will be increased in these amendments. Penalties and offences will be

increased, which is consistent with the recent increases that have been

made under the Real Estate Services Act.

Finally, minor corrections are made to make it an offence to fail

to comply with the requirements for consolidated disclosure statements,

and clarifies that those disclosure statement requirements are the

responsibility of the developer.

Together, these amendments make the condo market fairer for

British Columbians. They are the first step in making sure that people

who flip presale condos are paying their fair share of taxes. They’re a

first step to stop speculators in the presale condo market from driving

up prices for British Columbians.

By tracking presales and ensuring appropriate enforcement, we’ll

crack down on tax evasion. We’ll also have the information, then, if

further action needs to be done, to be able to move ahead on further

action to address this issue.

I look forward to the discussion on second reading, and I’ll take

my place.

S. Bond: Thank you to the minister for her remarks, both here and at the

introduction of the bill. I’m going to make some comments. Obviously,

we’re going to work our way through this in committee stage, but I do

want to thank the minister’s staff for making themselves available for a

briefing. That’s always appreciated, and this minister is very helpful

in terms of providing those kinds of opportunities for members of the

opposition, and I’m sure for the Green Party as well. We appreciate

that.

I think the minister has outlined an important issue that, as she

reflects on, is important to every member of this House. Housing and

affordability were critical issues during the election campaign and have

been since that period of time. I think that, generally, people would be

supportive of Bill 25 — when you think about the fact that this makes

sure that when a gain is made on the assignment of a presale contract,

the appropriate taxes are collected. I think most British Columbians

would assume that’s happening, and they want to be sure that that

happens.

I think this is about making sure that that practice is in place

and it is being strengthened. As the minister pointed out, the bill will

require real estate developers to collect and report information on

presale condo purchases and sales — they’re called assignments, for

those of you who may not know what that’s about — to make sure people

are paying the proper taxes when that contract is

transferred.

Currently, if a seller assigns a contract to another person at a

personal gain, they are supposed to be paying capital gains taxes if

they make a profit. But as this bill points out, without adequate

reporting requirements, those taxes can be and probably often are

avoided. I think that we will have…. I’ll be interested in hearing from

my colleague the Leader of the Third Party, his perspective, but I’m

assuming we would all agree that we need to actually close that

opportunity and make sure that those taxes are being

collected.

The amendments in Bill 25 will mandate developers to include terms

in their contracts to inform buyers of the new collection and reporting

requirement. So there will be, in essence, informed consent.

[3:00 p.m.]

People will actually need to…. They will be made aware, and they

will actually make a decision about agreeing to that particular

reporting requirement. The information will be reported to the

provincial administrator — as the minister has pointed out, designated

under the Property Transfer Tax Act — and information will be collected.

Certainly, private information will not be publicly shared.

One of the issues that we certainly will have some discussion

about is that Bill 25 also raises the cap on administrative penalties on

developers, and they are significant increases. We see the caps moving

from $50,000 to $500,000 for corporations and from $25,000 to $250,000

for individuals. The amount developers would have to pay if they are

convicted of a violation of the act would also be raised. In fact, it is

a very significant increase, again — obviously a deterrent is, I would

assume, the minister’s intention — from $100,000 to $1.25 million for

the first conviction.

As you can imagine, we certainly see that that is a 1,000 percent

increase in administrative monetary penalties and fines. I think that

there is some room for discussion about a $1 million fine for

incorrectly filing paperwork. It may seem excessive to some. I think

there’s some room for discussion about that. We’ll certainly be asking

those kinds of questions during committee stage.

Once again, we see that the bill allows cabinet to make regulatory

changes. They will be able to prescribe the information that must be

collected from developers. The term at which it is responsible will

require consent from the developer for an assignment to occur. As I have

said and will continue to say every time a bill comes before the House,

and was certainly the recipient of much criticism from the other side of

the House every single time we brought a bill forward that said there

would be reg-making powers and authorities….

I don’t think a bill has come through this House under the current

government that allows cabinet to add some sort of regulation. This is a

significant issue. When you look at what the bill says, it says that

cabinet will decide the information that must be collected from

developers. There’s a whole range of thinking that could possibly take

place at the cabinet table with that kind of regulatory power. From our

perspective, we’re certainly going to ask some questions about why that

reg-making authority is necessary and what the minister would anticipate

cabinet would be thinking about in terms of adding additional regulation

and, certainly, information that’s corrected.

The purchaser of a presale condo must have confidence that they

are paying fair market value for a property. We must ensure that

artificial price escalation does not occur and enrich a very small

minority at the expense of British Columbians who want to buy a home.

Again, I think that’s something that all of us feel very strongly about.

An open market only happens when there is a level playing field between

those selling a property and those making a purchase. Confidence in the

market is gained only when the rules apply to everyone. So from that

perspective, we want to make sure that the rights and obligations of

both the buyers and the sellers are properly respected in

legislation.

With that being said, the proposed legislation is intended to

ensure that appropriate taxes are paid when a gain is made through the

assignment of a presale contract. We need to know if the measures

contained in this bill will be effective and if they’re headed in the

right direction. During the bill debate, we certainly will be asking the

minister, during committee stage, if she has a complete picture of the

number of assignments that this legislation may address. In other words,

we need to have the whole picture in front of us to make sure we’re

taking the right steps.

We also need to know if the obligations we impose on developers

and purchasers are reasonable and sound. To that extent, does the

government have an estimate of how much revenue will be generated

through the proper application of capital gains tax? Was there a

conversation with the industry? How do they feel about this? Is there a

sense of what that gap is? How many people are avoiding paying those

taxes? Those are all important follow-up questions. Again, there will be

some conversation about the type of information that’s collected and

what it will be utilized for.

[3:05 p.m.]

One of the things I wanted to just contemplate for a moment was

the fact that when you read the description that was provided by the

government when they released the news release about this bill, talking

about bold steps to fix the housing crisis…. One of the lines in the

release that actually was quite surprising to me…. I understand the

minister has laid out that this is a series of things, and this is

another step in the government’s agenda.

When we stop and think about what this bill does, and when the

sentence in the press release says, “We are making it fairer for people

who want to buy a condo by making sure those who flip presale condos are

paying their fair share….” Wouldn’t one want to assume that what we

really want to try to do is disincent people from actually flipping

condos? It’s certainly been identified as a significant issue. One of

the things that are not reflected in this legislation are the kinds of

disincentives or prohibitions — actually looking at how we manage to try

to disincent people who seek to profit by not just paying appropriate

taxes but with even the concept of condo flipping.

From my perspective, when we think about this, we assume people….

At least, the press release assumes people are going to flip condos. So

let’s make sure we get the taxes out of them. What we really need to be

thinking about are steps that say: “That’s not the way we want this

marketplace to work in British Columbia.” So are there things that could

have been or should have been included in this bill that would have

looked at how we could disincent people from flipping condos in the

first place?

Generally, we agree. If they’re going to flip, we want their tax

revenue. But the key point is: how can we disincent people? How do we

look at far more rigorous controls in terms of how condo flipping is

taking place in the province?

We will be asking the minister, during committee stage, about some

of those features. Did she contemplate what else could have been added

to this bill? When you look at the information that’s collected, are

there ways to help disincent people from contemplating purchasing three

or four or five units and then flipping them?

This is about tax collection. We agree that that is probably an

important gap to close.

We also want to…. When we look at the proper obligations that are

included in this bill…. The proposed changes to the Real Estate

Development Marketing Act will require real estate developers to collect

and report information and include those terms in their contracts. To

enforce these requirements, the government is imposing stiff penalties

to developers if these obligations are not met.

Let’s look at compliance. In order to be compliant, developers are

being asked to collect information on the basis that assignors and

assignees are providing true and accurate information. For those

attempting to skirt the rules by providing false or inaccurate

information, I see no provision in this bill that would prevent or

penalize these types of offences.

In fairness to those required to collect the information, we

certainly want to ask the minister during committee stage: what measures

are being taken to prevent a situation where a developer attempts to

collect information in good faith and could be held responsible for

false or inaccurate information that is provided by the assignors and

the assignees? In fact, they have done their due diligence, and they

have done their work in good faith.

We’re going to ask the government whether they assume that

developers are in a position to verify all of the information that is

provided to them. Those are simply important checks and balances that we

think should be considered when we’re looking at the kinds of fines that

developers could potentially face. We want to be sure that should the

minister be looking at this process, is there consideration for due

diligence and good faith before the developer is fined at fairly

significant fine levels?

In conclusion, I appreciate the opportunity to make some initial

comments. We do want to ensure that the purchaser of a presale condo, if

they achieve a gain, in fact is paying taxes. We think that is very

important. We also want to make sure that the playing field is level and

that our developers engaged in having to collect that information are

not unfairly penalized.

[3:10 p.m.]

Generally speaking, we think there is some merit. Our primary

concern is that this bill is looking at making sure that we collect

taxes from condo flippers. In fact, we need to be looking at significant

initiatives that will actually disincent people from the practice of

condo flipping in the first place. The minister has said this is one

step and one tool in the toolbox. We certainly look forward to further

discussions about how that might be accomplished in British

Columbia.

A. Weaver: I rise to take my place in second reading on Bill 25, Real Estate

Development Marketing Amendment Act. This bill amends the Real Estate

Development Marketing Act. It requires developers to collect and store

information on presale condo assignments, which will enable the

government to track presales and to tackle tax evasion.

To start, I wish to thank the minister for bringing in such

legislation. It is timely, and it addresses a very important issue.

Also, to the member for Prince George–Valemount, I appreciated her

careful analysis of the bill and look forward to her questioning at

committee stage, where I, too, share some of the concerns she raised.

Overall, my colleagues and I in the Green caucus down here do support

this bill and the intentions.

I’ve heard many a story from British Columbians frustrated with

watching their condos or townhouses in their developments being sold

multiple times without people actually moving in, questioning who is

actually buying and who is actually selling and, in fact, raising the

question as to whether taxes are being collected during the process. But

more importantly, asking the question: how is this allowed in the

province of British Columbia?

While this bill amends the Real Estate Development Marketing Act

and makes a number of changes, it doesn’t, as the member for Prince

George–Valemount said, actually get to the fundamental essence of why

people are flipping and how we put in place measures to disincentivize

that flipping. One of the things we could talk about — I won’t now but

perhaps in future bills brought forward — is the introduction of

something like a flipping tax, a tax that actually targets people who

are buying and selling on a rapid time frame with no intention of

actually moving in.

We could talk about the potential problems that we see in British

Columbia where certain developments are marketed offshore at prices that

are below what you could buy them for onshore. In fact, I’ve got stories

and articles on properties that are marketed offshore something to the

tune of 20 percent below the price you could get for them

here.

The purpose to do so, of course, is that you could get lots of

mass presales done all at once and then these…. Who knows who ends up?

They could very quickly and very rapidly be flipped multiple times for a

short-term gain, and only if the person doing the flipping actually

decides to declare, in Canadian income, that this is a capital gains

would they actually pay tax.

The bill requires real estate developers to collect and report

information on presale condo assignments. Developers now will have to

include terms in their contracts to inform buyers of new collection and

reporting requirements. The information will be reported to the

provincial administrator designated under the property transfer tax, and

information will be shared with the federal government to enable

collection of capital gains. Increased administrative penalties and

offences are also being incorporated in this bill.

This is actually one of several bills that the government has

brought forward since the fall which is designed to get Revenue Canada,

CRA, more information on which they could actually enforce existing

legislation. So I do thank and commend the minister for bringing in yet

another piece of legislation that ensures that information is present

for CRA to actually get taxes when taxes are owed.

Most of the bill is contained in a major section, which is

section

4. It creates a new component of the act with provisions for the

requirements of developers. That will be the subject of the most

extensive canvassing, I suspect, during the committee stage.

I’ve gone over a bunch of the media’s reporting on this to see

what reaction we got from various stakeholders. It’s interesting that….

To say this is uncontentious would be a very fair statement. A diverse

number of business leaders as well as developers have stepped in. For

example, Anne McMullin, as we know, the CEO of the Urban Development

Institute, an institute that represents a collective of developers,

particularly in the Vancouver region — or she represents, at

least.

[3:15 p.m.]

She said her real estate lobby group supports the measures that

are brought forward by the minister, although in fact, she characterized

this as a small problem — 3 percent. I would argue that we might not

know what the percentage is if we’re not collecting the data, so I would

suggest that that would be an estimate. That was reported in the new

Vancouver Star , the Toronto Star version of the paper

that’s emerging in Vancouver.

She says the following: “We had been talking about this before the

budget. If you really want to address speculation, this is where you had

to address it.” That’s a pretty strong statement — in fact, endorsement

— for the legislation here.

Another in a Castanet

article coming out of the Okanagan. Cameron

Muir, who’s a chief economist of the B.C. Real Estate Association, also

said that compiling data to track presale condominium sales is a long

overdue move — again, some high praise for this bill from a relatively

well-connected individual in this particular industry.

Again, there’s Steve Saretsky. He’s quoted in the Vancouver

Sun . He’s a Vancouver real estate agent who suggests it would

bring more transparency to that part of the market, which currently

lacks it.

Another Vancouver realtor, a fellow called Rick Clarke, in the

same Vancouver Sun article, argued that they should do this. “A

lot of people are not reporting and not paying tax and making big

capital gains.” He further went on to say that there’s “a select group

of agents” that have tight relationships with developers who rely on

them for being able to sell chunks of presale condo units, describing

one “known for just having signed 51 contracts in a

half-hour.”

This is a very fine piece of legislation designed to provide

government and, in particular, taxation agencies information in which to

ensure that existing taxation laws are enforced. It’s very timely,

particularly in light of some of the more nefarious, almost, incidences

that are coming to light from investigative reporting by such

journalists as Kathy Tomlinson in the Globe and Mail , who

highlights some of the oddities that are happening in certain segments

in the Vancouver real estate market.

One thing I would caution, though, is that as we continue to take

steps to address what could only be described as an out-of-control real

estate sector or housing market in Metro Vancouver, we be careful not to

hit this whole province with that same sledgehammer that’s hitting there

in Vancouver.

For example, there’s no question that this is important

information that needs to be shared across the province, so implementing

this from north to south, east to west is not a big deal. But there are

other issues where previous governments, for example, brought in

measures targeted specifically on limiting dual agencies.

That was a direct response to problems that were out of control in

Vancouver, but it had unforeseen consequences in rural parts of British

Columbia, where you may have very small offices or you may have one

broker in the whole town now facing strife and troubles, not knowing how

to actually represent clients, both buyers and sellers, when there’s not

the capacity.

As we move forward in dealing with these issues in the housing

market, it’s important to recognize that not always does one size fit

all. In this particular case, I think it’s clear that reporting is a

good thing. I think that it’s critical that people pay taxes when they

should pay taxes. As we move forward, let’s hope that we start to look

even more closely at the concept of flipping and discouraging that

through means possible.

Again, I thank the minister for introducing this bill. We are

proud to support this bill. And I thank the member for Prince

George–Valemount, who brought in very fine comments that we’ll look

forward to seeing explored further in committee stage.

D. Barnett: I would like to begin my comments by providing a brief description

of the legislation. Following that, I, too, would like to outline the

objectives, as the official opposition, that will ensure a fair and open

real estate market, particularly with respect to a fair and open

marketplace. I will then conclude my remarks with my own

concerns.

This bill will require real estate developers to collect and

report information on presale condo purchases and sales, called

assignments, to ensure that people are paying their proper taxes when

the contract is transferred.

Currently, if the seller assigns a contract to another at a

personal gain, they are supposed to pay capital gains taxes if they make

a profit. Without adequate reporting requirements, however, these taxes

are often avoided.

[3:20 p.m.]

The amendments of Bill 25 will mandate developers to include terms

in their contracts to inform buyers of the new collection and reporting

requirements. The information will be reported to the provincial

administrator designated under the Property Transfer Tax Act. This

information will not be publicly shared.

Bill 25 would also raise the cap on administrative penalties on

developers, from $50,000 to $500,000 for corporations and from $25,000

to $250,000 for individuals.

The amount developers would have to pay upon a conviction for a

violation of the act would also be raised, from $100,000 to $1.25

million for first conviction, and from $200,000 to $2.5 million for

subsequent convictions.

The bill would allow cabinet to make regulatory changes

prescribing that information that must be collected from developers, and

the term at which it is responsible, will require consent from the

developer for an assignment to occur. This also includes rules around

filing said assignments information.

As mentioned earlier, we the official opposition are concerned

that law-abiding British Columbians are treated fairly and that everyone

is protected by a free and open marketplace. The purchaser of a presale

condo must have confidence that they are paying fair market value for a

property. We must ensure that artificial price escalation does not occur

and enrich a small minority at the expense of British Columbians who

want to buy a home.

An open market only comes about when there is an even playing

field between those selling a property and those making a purchase.

Confidence in the market is gained only when the rules apply to

everyone. To this end, we must ensure the rights and obligations of both

the buyers and the sellers are properly respected in

legislation.

What appears to be missing in this legislation are prohibitions

against those who seek to profit without paying appropriate taxes. Why

is there no provision in this legislation that would put a tax on condo

flipping? This practice inflates market pressure by speculators and

makes it nearly impossible for young people to enter the real estate

market with astronomical prices.

The question that begs to mind as to how much consultation was

done with the industry in advance of this legislation…. This legislation

stipulates penalties for developers but little to address assignment

deals that jack up the costs of a presale unit before anyone actually

lives in a condo.

I would also like to know if any consideration has been given to

this type of market inflation with respect to the government’s recently

announced review of real estate regulators.

According to an April 18 press release: “The review will examine

the roles and responsibilities of the Real Estate Council of British

Columbia and the office of the superintendent of real estate. Topics

under review include the appropriate structure and composition of the

regulators, how they should communicate, mechanisms for resolving

disputes, and how to divide responsibility for matters such as licensee

qualifications and rule-making.”

The news release goes on to say: “The purpose of this review is to

ensure B.C.’s regulatory system is protecting consumers in the real

estate market. The review will provide recommendations to the Minister

of Finance for consideration by June 15, 2018.”

My question, then, is…. This legislation comes before this House

before the review is complete next June. It would make more sense to me

to address questions about consultation and the protection of consumers

once we know the results of this review. We need to pay close attention,

because the outcome of this process is going to affect how consumers

purchase a home in this province.

I am deeply concerned, because it appears that the government

could end up limiting the rights of consumers to choose. In my opinion,

buyers in this province have every right to select a realtor of their

choice. It doesn’t matter if you are selling or buying a business, a

home, a ranch or a recreational property.

[3:25 p.m.]

Government does not have the right to dictate the way you handle

the sale or purchase of your own property, but we are seeing this with

the proposed rules respecting dual agency. This will require realtors,

especially those in rural regions, from recusing themselves from sales

under certain circumstances.

I recently received a letter from the B.C. Northern Real Estate

Board on this issue. Here is an excerpt from that letter:

“The B.C. Northern Real Estate Board believes strongly that the

proposed ban on limited dual agency will negatively impact the provision

of real estate services to British Columbians living in rural or small

communities. The practice of real estate in the north and north central

area is unique, and imposing rules without considering the uniqueness

will lead to unintended and negative consequences.”

In other words, there may not be a one-size-fits-all

solution for the province as a whole. What measures are contained in

this bill may be applicable to the Lower Mainland but not necessarily in

northern and rural British Columbia.

The B.C. Northern Real Estate Board goes on to say:

“We welcome thoughtful and meaningful reforms that continue to

ensure the public’s interests are protected and that also support

ethical real estate professionals. In the case of dual agency, however,

the process failed to consider the people who will be most affected by a

ban — consumers, communities and licensees in areas outside the Lower

Mainland.

“The board requests a review of the ban to provide decision-makers

with a full assessment of the impacts of the proposed reforms.”

I do hope the government will take this matter into account,

following the conclusion of the review — and how government intends to

respond in kind.

In conclusion, we want to ensure that the purchaser of a presale

condo must have confidence that they are paying fair market value for a

property. We must ensure that artificial price escalation does not occur

and that appropriate taxes are paid in the course of a transaction. To

this end, as legislators, we must ensure that the rights and obligations

of both the buyers and the sellers are properly respected in

legislation.

T. Redies: I rise today to speak on the second reading of Bill 25, Real

Estate Development Marketing Amendment Act, 2018.

As indicated by my learned colleague from Prince George–Valemount,

this bill will put the onus on real estate developers to gather and to

report information to government on presale condo purchase and the sales

assignments.

The premise behind this bill is that it will enable government to

collect the appropriate taxes on any transferred contract and support

greater fairness in the real estate market in B.C. There is validity in

this approach.

As legislators, we want to ensure that there is a robust process

in place to ensure that people pay their fair share of taxes — in this

case, capital gains taxes — if they profit from the sale or assignment

of a strata they purchased. It also makes sense from the perspective of

building trust in the effective and fair operation of the real estate

market in British Columbia for all stakeholders, especially those who

are living and working here and trying to buy a home at a fair price.

The bill, as such, aims to increase confidence that when a gain is made

on the assignment of a presale contract, the appropriate taxes are being

collected.

For clarity, let’s just recall some aspects of the bill, as I

understand it. The bill requires developers to include in their

terms-of-sale contract with the buyer the requirement to gather and

report prescribed information by government to government.

Bill 25 also requires that the contract with the initial buyer

include terms requiring the purchaser to get prior consent of the

developer before assigning any purchase agreement. Further, the

developer cannot provide consent to the assignment without the

appropriate information being obtained. Developers who consent to an

assignment must obtain a copy of the written and signed assignment

contract and must keep the contract in some manner and for some period

of time that has not yet been clearly spelled out in this

bill.

[3:30 p.m.]

Developers must also file all of this information with an

administrator of the government and must file a statement even if the

requirements don’t apply under a transaction, presumably in the

situation where assignments of purchase agreements are

prohibited.

In addition, there are substantial, almost eye-popping increases

in penalties introduced in this bill. Under Bill 25, developers not

conforming to the requirements could pay administrative penalties ten

times the previous amount, to $500,000 for corporations and $250,000 for

individuals.

Further, if a developer is convicted for a violation of the act,

the penalties would be raised from $100,000 to $1.25 million for the

first conviction and from $200,000 to $2.5 million for subsequent

violations.

[R. Chouhan in the chair.]

Finally, the bill allows cabinet substantial leeway to make

regulatory changes pertaining to the act, including, among other

capabilities, to modify the type and scope of the information

required.

There’s no question that we want to see greater affordability in

our housing market and clamp down on situations that are escalating

prices so much that average British Columbians cannot afford to buy

homes where they live and work. It also appears, if the news is correct,

that there have been a number of people who have been benefiting from

legal but arguably unfair trading practices, preventing homes from being

available to the wider public.

I do believe we need to address the housing situation in this

province so there is fairness and people can have confidence that the

marketplace allows all buyers and sellers equal opportunity to

participate. We also need to make sure that more homes are available to

average British Columbians who work and live here, not just offshore

buyers who are flipping homes purely for a profit.

Now, while I appreciate the spirit of the bill, like my

colleagues, I do have a number of questions, which of course we will

canvass more in the committee stage. In particular, there’s a fair

amount of open-ended, unspecified aspects of this bill which give me

some cause for concern.

As an example, the type of information that developers are

required to gather is not clarified, unlike other bills we have seen

earlier this year, which makes me wonder why the government hasn’t been

more specific about the information they’re going to be requiring. Is it

that they haven’t had time to think through this bill, as we have seen

with other tax-related bills earlier this year, and announcements, or do

they want to keep it open-ended so they can decide at any time to

increase the amount and type of information being required? I’m not

actually sure what the answer is here. If I were a developer, I would

want a lot more clarity around the type and scope of information that

the government will require them to collect.

Further, there’s little clarity around what constitutes an

administrative penalty. Given that fines are now ten times higher than

what they were before, I believe the government has to be fair to

developers and provide them with additional detail as to when and how

administrative penalties will be assessed.

The bill also places a peculiarly heavy onus on developers to

gather and submit information without really outlining any

responsibilities, penalties or ramifications with respect to the

assigner and the assignee involved in the transaction. I think my

colleague from Prince George also touched on this. Particularly if the

desire of the purchaser is to avoid capital gains tax, one would have

thought this bill would cover the two sides of the party most involved

in the transaction and who benefit from the transaction.

Further, there are no requirements or penalties for assigners or

assignees who provide false information to developers. This is

concerning to me, because developers are not in the business of

information-gathering and records-keeping. They are in the business of

developing and selling properties.

This is another issue for me with Bill 25’s approach. I don’t

believe that developers are in a position to verify the information

provided by third parties, and it would be problematic to hold them

liable for false information provided by one or two parties to a

transaction. It seems to me that there would be other, more suitable

avenues to ensure that the required information was properly acquired

and vetted for accuracy, perhaps through the legal process of a

transaction.

Also, if an assignment takes place and a developer is not

notified, would the developer still be liable for a penalty? It is not

clear to me with this legislation. A developer, of course, cannot be

expected to keep tabs on all purchasers, so I wonder if this legislation

will really catch the people the government is attempting to

catch.

Further, what happens if an assigner and assignee agree in a

written assignment with a developer that the assignment fee for a

purchase agreement, for example, be $25,000, but they have a side

agreement that says that the assignment fee will be more like $100,000?

Would the developer still be held liable if they submit forms based on

the written assignment with the assigner and assignee? It appears from

the way the bill is written that the developer would still be in breach

section 20.4, an offence under

section 39.1(a), thereby exposing the

developer to penalties of up to $1.25 million.

[3:35 p.m.]

In other words, the bill has no due diligence or reasonable

efforts defence, meaning that developers could still be subject to

penalties, even if they use all reasonable commercial means to obtain

and provide the required data. As such, from my perspective, the bill

needs greater clarity in terms of ensuring that developers who are

acting in good faith but who are really at the mercy of assigners and

assignees providing correct and honest disclosures are not punished

because an assigner and an assignee acted under false

pretenses.

Further, this bill requires a developer to collect and remit to

the administrator and keep information for an unspecified period of

time. While we don’t have a lot of clarity in this bill with respect to

the type or extent of information, I’m presuming this information would

likely be of a private and confidential nature.

The developer is also expected to report to the administrator but

keep a copy of the assignment agreement in the prescribed manner for a

prescribed period. While there are confidentiality clauses with respect

to the administrator, surprisingly, there doesn’t seem to be any

corresponding requirement for the developer to ensure that the

information is kept confidential, unless I missed something.

In addition, I have real questions on how this bill will be

administered. Who or what department will be responsible for taking the

information gathered by developers? How will it be used, and how will

developers be held accountable? Will there be periodic audits or

anything to ensure that the appropriate practices are taking place? What

additional staff will be required to administer this bill to ensure that

it is effective in what it sets out to do?

Now, while I have a number of other questions, in the interests of

time, the final area I would like to note today that is not clear to me

and causes me some concern in its open-ended nature is the sharing of

data between governments. Again, while I think it is absolutely

appropriate to ensure that people are paying their fair share of taxes

and for governments to share information to ensure that that happens, I

have some concern with respect to clause 20.5(c)(i), which, again, seems

very open-ended.

It appears to confer the authority of this government to share any

information with any government that the B.C. government has an

agreement with. I’d be curious to understand what powers this is giving

the current government and under what circumstances, other than sharing

with the CRA, the government would look to share information with other

governments. Unlike 20.5(d), which references the ability to share

information for the purposes of compiling statistical information with

the federal government specifically, clause 20.5(

c) seems to be very

broad.

In

summary, I’m generally supportive of the direction of this

bill, and I do believe it has merit, in terms of supporting a fair

marketplace for both buyers and sellers, as well as ensuring fairness in

the taxation regime. However, I do have questions, as outlined in the

body of my speech today. I look forward to being able to discuss these

further at committee stage.

Deputy Speaker: Seeing no further speakers, the minister to close the

debate.

Hon. C. James: Thank you to all the members who spoke on the bill. I appreciate

the comments, I appreciate the discussion, and I appreciate the general

support for the direction that is being taken with this piece of

legislation.

I think it’s important, as we look at this legislation, to

recognize that there are stages and steps. I think a lot of the

questions that came, particularly at the start of the discussion on

second reading, really focused on future steps. What steps can we take

if you’re looking at ending condo flipping, if you’re looking at ending

the practice? That came from a number of the members who spoke. That’s

impossible to do unless you have the information. It’s impossible to

take those next steps until the information is gathered.

What kind of challenge do we have here? I think a number of

members talked about how much of a problem this is. How much of an issue

is this out there? Well, again, unless we have the information, unless

we gather the information, it’s impossible to know. That’s part of the

real frustration, I admit, in taking a look at addressing a lot of the

housing measures. There is a huge gap in information that just isn’t

collected or wasn’t collected over the last number of years.

My hope is that this bill and a number of other measures — which

as the members know, we’ve brought forward in this session as well —

start sharing information with various parts of government to be able to

gather the data that’s needed to make those kinds of next step decisions

that may need to occur.

I certainly appreciate the suggestions from members around what

other disincentives could be used to deal with condo flipping. I think,

again, getting this information and knowing the basics will make a huge

difference when we’re taking a look at that.

There was a lot of discussion, and I will get into it. I won’t

give lots of answers now around the specifics because I know we’ll get

there in committee stage, everything from the fines and why the fines

have gone up so much. If developers do their due diligence, what issues

are there?

I understood those questions. I think it’s good information for us

to be able to bring forward and have a discussion on, as I said, when we

get into committee stage.

[3:40 p.m.]

I appreciate the comments that have been made by the members. I

know we’ll have a chance — I think later this week — to have a further

discussion in committee stage.

With that, I move second reading.

Motion approved.

Hon. C. James: I move that the bill be referred to Committee of the Whole House

to be considered at the next sitting of the House after

today.

Bill 25, Real Estate Development Marketing Amendment Act, 2018, 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. D. Eby: I call second reading of Bill 28, the Public Interest Disclosure

Act.

BILL 28 — PUBLIC INTEREST

DISCLOSURE

ACT

Hon. D. Eby: I move the bill be now read a second time.

The proposed Public Interest Disclosure Act will encourage

employees to report serious wrongdoing by protecting them from reprisals

associated with such reporting.

Government agreed to introduce public interest disclosure, also

known as whistle-blower legislation, as part of accepting the

recommendation of the Ombudsperson’s 2017 report into the 2012 Ministry

of Health employment terminations and related matters.

The proposed legislation will initially apply to the public

service, including ministerial assistants and executive assistants in

ministers’ offices and officers of the Legislature, and is intended to

be applied to the broader public sector at a later date.

The Public Interest Disclosure Act is based on a review of the

best practices from around the world, with most of the content derived

from Alberta, Manitoba, Ontario and Australia. The Ministry of Attorney

General has worked in partnership with staff from the Public Service

Agency and have consulted extensively with the Office of the

Ombudsperson when drafting this act.

I would now like to highlight some key aspects of this

legislation. The act applies to certain types of wrongdoing, alleged

offences, acts or omissions that pose a danger to life and safety,

serious misuse of public funds or assets, and gross or systemic

mismanagement.

The act requires government to designate internal officers to

receive and initiate disclosures of wrongdoing and appoints the

Ombudsperson as an external reporting and investigative

entity.

The act places a positive obligation on government to advise

employees of the protections provided under this act and the different

ways in which employees can report serious wrongdoing. A person is not

given immunity from employment consequences if they participated in

wrongdoing that they subsequently disclose.

The act specifically authorizes disclosure to the Ombudsperson of

information that would otherwise be protected by public interest

immunity, which includes cabinet privilege.

The act also allows the discloser to share information that would

otherwise be protected by a specific provision in another statute to a

designated officer or to the Ombudsperson but not publicly.

The act allows for anonymous disclosures. Public disclosure is

permitted in very limited circumstances, and the discloser must comply

with the prescribed process.

The Ombudsperson is given the same investigative powers with

respect to disclosures under this act as the Ombudsperson has under the

Ombudsperson Act. The Ombudsperson may refer investigations to other

officers of the Legislature if the investigation relates to areas of

their expertise. For example, financial mismanagement may be referred to

the Auditor General. While referred matters will be dealt with under the

other officers’ legislation, the protection provisions of this

legislation will still apply.

It is an offence under the act to commit a reprisal against a

discloser, and the act gives the Ombudsperson the ability to make

recommendations about how to remedy the reprisal. B.C. will lead the way

and be the first jurisdiction to establish a low threshold for the

Ombudsperson to initiate an investigation into an allegation of

reprisal. This has been recommended in the OECD’s G20

Anti-Corruption Action Plan: Protection of

Whistleblowers .

A discloser will only be required to provide prima facie evidence

that a reprisal has occurred in order to initiate an investigation.

Unless the Ombudsperson believes the complaint of reprisal is frivolous

or vexatious, the Ombudsperson must investigate an allegation of a

reprisal. While an investigation must be initiated on prima facie

evidence, a civil standard must be satisfied to determine whether a

reprisal has in fact occurred.

The act ensures accountability to the public by placing an

obligation on all entities covered by the act to produce annual reports

detailing the number of allegations of wrongdoing that were reported and

investigated. The Ombudsperson is also obligated to produce annual

reports of disclosures they receive, resulting investigations and

whether the recommendations have been implemented.

In conclusion, the proposed legislation does not create a positive

obligation on anyone to disclose serious wrongdoing. Rather, it provides

protections to individuals who disclose serious wrongdoing to the

Ombudsperson or designated officers within government in accordance with

this act.

Moreover, the act specifically ensures that it does not take away

any existing protection provided to people who disclose wrongdoing under

other legislation. For example, current requirements to report

wrongdoing under the public service standards of conduct will remain in

effect.

[3:45 p.m.]

M. Lee: I rise today to speak to Bill 28. This bill, as the Attorney

General has outlined, follows on the recommendations in the

Misfire report, which followed the wrongful firing of

researchers from the Ministry of Health and the tragedy that followed

after one of them regrettably took his own life.

The bill provides a process and protection for individuals that

report wrongdoing, ensuring that whistle-blowers who come forward will

be shielded from retribution and ensuring that there is a fair process

for them to come forward. The bill also provides internally designated

officers to investigate these claims and also provides for the

Ombudsperson to be involved if need be.

From the 1980s to the early 2000s, only four OECD countries had

whistle-blower protection laws. Since 2006, whistle-blower protection

laws have been passed in nine OECD countries. Beginning in 2000, several

of these countries experienced preventable public scandals that inspired

the onset of dedicated whistle-blower legislation.

Other jurisdictions that have brought in similar legislation often

followed events such as publicly commissioned investigation inquiries.

Initial whistle-blowing legislation in Australia was motivated by the

Fitzgerald Inquiry, which occurred in the late 1980s. That inquiry, also

referred to as the Commission of Inquiry into Possible Illegal

Activities and Associated Police Misconduct, was an additional inquiry

that looked into the Queensland police corruption.

The commission resulted in the deposition of a Premier, two

by-elections and the imprisonment of three former ministers and a police

commissioner. That Fitzgerald inquiry recommended whistle-blower

legislation, which was slowly adopted by states and territories and

culminated in the adoption of the federal Public Interest Disclosure Act

in 2013.

They certainly didn’t move as quickly as Canadian jurisdictions

have following their own recommendations. For example, in Canada, the

federal sponsorship scandal, which involved gross misuse of public funds

intended for government advertising in Quebec, ran from 1993 to 2006.

The investigation into that scandal was done through the 2005-2006

Gomery report. The report recommended implementing dedicated federal

whistle-blower legislation.

In 2004, legislation entitled Policy on the Internal

Disclosure of Information Concerning Wrongdoing in the

Workplace was introduced into the House. The legislation did

not initially pass in 2004, but similar legislation in the form of the

Public Servants Disclosure Protection Act was passed in 2006.

More recently, in June 2017, the House of Commons Government

Operations and Estimates Committee released a report recommending

substantial changes to the Public Servants Disclosure Protection Act.

The development of this report was motivated by several recent federal

scandals, including the Lac-Mégantic rail disaster and the failure of

the Phoenix pay syst