1998 Legislative Session: 3rd Session, 36th Parliament

HANSARD

The following electronic version is for informational purposes only.

The printed version remains the official version.

Official Report of

DEBATES OF THE LEGISLATIVE ASSEMBLY

(Hansard)

MONDAY, JUNE 15, 1998

Afternoon

Volume 10, Number 20

[ Page 8725 ]

The House met at 2:04 p.m.

Prayers.

T. Nebbeling: In the gallery today we have Mr. Jacques Carpentier, who is president of the Nanaimo Community Bingo Association. In this position he has become a very fierce fighter for the rights of charity organizations. It is his first visit to the gallery. I would ask the House to make him very welcome.

B. McKinnon: It gives me great pleasure to introduce to the House a constituent of mine, Jack Dhaliwal. He is here in Victoria visiting for a few days and decided to visit the House to see what we do in question period. Would the House please make him welcome.

G. Bowbrick: Joining us in the precincts are two classes of grade 5 students from Herbert Spencer Elementary School in the Queen's Park area of New Westminster. They are having a great tour today with their teacher and several other adults, including parents. I would ask the House to please join me in making them welcome.

Hon. D. Streifel: It is my pleasure today to introduce a group from my constituency who are touring the precincts. They are 25 grade 5 and 6 students from Agassiz Christian School, and they're accompanied by their teacher, Mrs. Little, and a number of parents. I would bid the House make them welcome.

Hon. A. Petter: Today in the members' gallery we have some special visitors from the state of Victoria in Australia. The Hon. Michael John is leading the all-party Federal-State Relations Committee on a study tour, primarily looking at an issue that we're all very familiar with here in Canada: in their case, the overlap and duplication of roles and responsibilities between the Commonwealth and the state. The committee is in Victoria meeting with my colleagues and senior officials today and tomorrow. I would ask the House to join me in making them very welcome.

Hon. D. Miller: Perhaps I am stretching things a bit, but I would like to note -- and I'm sure the House would like to join me in congratulations -- that Lisa Walters from Prince Rupert, after 15 years on the LPGA tour, has finally won a major tournament and set a course record. I would ask all the members of the House to join me in a fantastic welcome for this . . . .

P. Nettleton: Please join me in welcoming Kim Teh. This gentleman is from Singapore and, more recently, from Ladysmith, here on Vancouver Island.

C. Hansen: Today I'd like to welcome two individuals who fight very hard on a day-to-day basis on behalf of B.C. small businesses and other job creators in this province: Keith Sashaw and Marcia Smith. Both are involved with the Coalition of B.C. Businesses. Please make them welcome.

J. Cashore: It is a great honour to introduce three good friends who are also members of the NDP Coquitlam-Maillardville executive: Brenda Justason, Tim Pollock and Rita Pollock. I just want to mention that Tim is, I believe, 73 years old, and that in any 24-hour period you will find him doing a 350-kilometre bicycle marathon. Please make them welcome.

Hon. C. Evans: Visiting us in the gallery today is my friend Antoinette Halberstadt. She is also an ambulance driver and paramedic in the valley I live in, sometimes my assistant and always my neighbour. Will the House please make her welcome.

J. Dalton: Visiting this afternoon is someone who is known to all members in this House, Mr. Arthur Griffiths.

Introduction of Bills

INCOME TAX AMENDMENT ACT (No. 2), 1998

J. Pullinger presented a message from His Honour the Lieutenant-Governor: a bill intituled Income Tax Amendment Act (No. 2), 1998.

Hon. J. Pullinger: I move the bill be introduced and read a first time now.

Motion approved.

Hon. J. Pullinger: Bill 33, the Income Tax Amendment Act (No. 2), 1998, introduces changes to the provisions which allow authority for the B. C. family bonus program. The amendments in Bill 33 include allowing for the introduction of a new B.C. earned-income benefit, which will be paid to eligible recipients of the B.C. family bonus. The new benefit will further the objective of our government of making work an attractive alternative to welfare.

The need for this legislation arises as a result of our B.C. family bonus program being extended in some measure to children across Canada, through the new national child benefit, which takes effect July 1 this year.

In 1996 our government introduced B.C. Benefits, a package of social policy reforms that has been deemed by social policy researchers as B.C.'s quiet revolution in social policy. Key to those reforms was the B.C. family bonus, which delivers up to $103 per month per child to approximately 45 percent of B.C. families. This program has been effective in narrowing the poverty gap for low-income families in British Columbia by 19 percent in just two years, and for single-parent families the B.C. family bonus has closed that gap by over 25 percent.

We on this side of the Legislature are very pleased that the federal government is joining with all provinces and territories in Canada to take this B.C. initiative Canada-wide, in a modified form, to all children in the country. These legislative amendments provide for the implementation of the first new social program in Canada in a generation, one that all British Columbians have reason to be very proud of.

Hon. Speaker, I move that Bill 33 be placed on orders of the day for second reading at the next sitting of the House after today.

Bill 33 introduced, read a first time and ordered to be placed on orders of the day for second reading at the next sitting of the House after today.

[ Page 8726 ]

Oral Questions

PREFERENTIAL ACCESS TO HEALTH CARE FOR WCB PATIENTS

S. Hawkins: On Thursday the Minister of Labour admitted that the health care system in B.C. is so bad that he's paying surgeons extra to take WBC patients to the front of the line. He admitted: "WCB will pay extra money in order to get expediated service."

Hon. Speaker, this is the same government that brought in the Medicare Protection Act and said . . . . They said it was illegal to do extra billing, to do queue-jumping and to have two-tiered medicine. So I want to know from the Minister of Labour why his ministry and the WCB are doing something today that last year they made illegal for every other patient in the province.

Hon. D. Lovick: I suspect that the member means WCB rather than WBC and expedited rather than expediated. But, having said that . . . .

Interjections.

The Speaker: Minister . . . .

Hon. D. Lovick: We did indeed discuss this matter in estimates at some length. We pointed out that one of the reasons why this change had been accommodated was because there was a dispute between orthopedic surgeons, who had not accepted the recommendations of the College of Physicians and Surgeons. Because those people had not accepted, therefore we went out of province.

S. Hawkins: Apologies to the Minister of Labour. It is my second language.

In typical NDP style, this minister and his government have set up one tier for WCB patients and another tier for every other patient on a waiting list in B.C. The Minister of Labour confessed that patients are being sent to Washington State for MRIs, and 69 patients this year alone have been sent to Alberta, of all places, for orthopedic surgery. I want to know -- again to the Minister of Labour -- if he will explain to the Minister of Health, when she says that her public health care system is so good, why he's sending WCB patients to Washington and Alberta for quicker service in the private health care system.

[2:15]

Hon. D. Lovick: The member doesn't have all of the story quite correct. People who are sent to Washington for an MRI are only those who live contiguous to the border, simply because it's quicker to send them there than somewhere else. That's how we use MRIs.

Interjections.

The Speaker: Members . . . .

Hon. D. Lovick: I guess it's recess time at school.

The Speaker: Minister . . . .

Hon. D. Lovick: Madam Speaker, the 69 patients who went to Alberta are indeed those who have fallen into the problem we had as a result of the dispute with the orthopedic surgeons. The number 69 refers to a total of about 8,000, so I don't think that 69 out of 8,000 is too problematic.

Interjections.

The Speaker: Order, hon. members.

L. Reid: On the one hand, we have the Minister of Health who says it's illegal for individuals to queue-jump in the province of British Columbia. On the other hand, we have the Minister of Labour who says it's not all that bad -- this terrible queue-jumping. My question is to the Minister of Health: if her government is so against two-tiered health care delivery, why is she allowing the Minister of Labour to send individuals to the front of the line?

Hon. P. Priddy: I think that the responsibility for the WCB is with the Minister of Labour. I think the Minister of Labour has put forth the position correctly: these are people who would get no care because they're caught in the middle of a dispute with physicians. Therefore they still deserve access to health care. In anyplace else in the province where we have had a dispute with physicians, people have still had access to health care.

The Speaker: First supplementary, the member for Richmond East.

L. Reid: That is in fact not the discussion. This minister's comments -- and I speak of the Minister of Labour -- extended to all patients in the province of British Columbia. The Blues will simply ascertain that fact. So this minister, when she attempts to justify a two-tier level of health care . . . .

The Minister of Labour again says: " . . . overwhelming evidence . . . demonstrates that the longer we delay providing that medical work, the greater the likelihood of the patient not returning to work." My question to the Minister of Health is: why is it different for Workers Compensation patients in British Columbia? Why is every taxpayer in this province not afforded the same excellent standard of health care?

Hon. P. Priddy: The level of health care should be equal for everybody in British Columbia. We all know that throughout the province, there are rural disparities and there are urban disparities. There are a lot of areas in which we have huge challenges in terms of bringing that kind of equity and equal access to health care. In the case of the WCB, if this dispute was not going on, they would have the same access to health care that anyone else does. This is simply action that is being taken as a result of the dispute going on.

G. Plant: The Minister of Health has it wrong. The facts are that last year the government of British Columbia made it illegal for British Columbians to pay for premium health care services, but the Minister of Health seems to think that the WCB gets special treatment. My question for the Minister of Labour is: why is it that he gets to do something that nobody else in the province of British Columbia is allowed to do?

Hon. D. Lovick: The Minister of Labour doesn't get to do anything. It's rather what the WCB does, which is an arm's-length body separate from government. That's point one.

Interjections.

The Speaker: Order, hon. members.

[ Page 8727 ]

Hon. D. Lovick: Second, the issue is that the overwhelming evidence in terms of workplace injury is that if people who are injured on the job don't get quick treatment, they will be that much slower to return to work. Indeed, if we wait over six months, the evidence is that they may never get back to work. We are not talking about all health care; we're talking specifically about injuries on the job covered by the WCB. It's a subset. I'm sorry if that's too complicated for members, but it's a subset.

Interjections.

The Speaker: Members, I encourage all the voices that have something to say to put them in the form of a question. It would be more useful that way to all of us, I think.

I recognize, for his first supplementary, the member for Richmond-Steveston.

G. Plant: Well, every day in British Columbia people are injured. They're injured in their back yards, they're injured on the streets, and yes, some of them are injured in the workplace. But the fact appears to be that if you're injured in the workplace, you get special health care in British Columbia. You get better health care; you get premium health care -- health care that it is illegal for other people in British Columbia to ask for or to pay for.

The minister still has not answered the question: why is it that people who are injured in the workplace get preferential access -- access which is denied to other British Columbians, access to health care which is illegal for other British Columbians? Why does the WCB get premium, top-tier access to medical health care in British Columbia?

Hon. D. Lovick: Nobody in British Columbia who is on a waiting list is being pushed aside by a WCB patient. That's point one.

An Hon. Member: That is not the case.

Hon. D. Lovick: No, it is the case. Point two is that this issue, which the Liberals seem to have discovered only last Friday, has in fact been going on for a number of years in this province. Number three is that it is just a little difficult to respond with equanimity to the comments made opposite, because these are the people who advocated and cheered the federal government on for 40 percent cuts to medicare and said they didn't go far enough. Now they have the temerity to say to the best system in the country bar none . . .

The Speaker: Thank you, minister.

Hon. D. Lovick: . . . that we aren't doing enough. It's a little hypocritical, a little galling.

CHARITY GAMING LICENCE APPLICATION DELAYS

B. Penner: Chilliwack's Mt. Cheam Rotary Club recently applied for a licence to raffle off a car to raise money for charity, but their entire application package was sent back with a letter that said: "Due to the volume of outstanding casino applications, the Gaming Commission is too busy to process the application." Last year this raffle raised $11,000 for charity, and I'm told that this year the target is $25,000. Can the minister responsible for gaming tell the charities in Chilliwack what programs they should cut because of his ministry's failure to deal with this application in a timely fashion?

Hon. M. Farnworth: The Gaming Commission is an independent body that will process the applications in the same way that they have for the last ten years, and charities can apply in the same way that they have for the last ten years. The fact of the matter is that there may be a small backlog, because the Gaming Commission was reconstituted earlier this year.

However, is the hon. member suggesting that the Gaming Commission not go by the rules? Is the hon. member suggesting that the Gaming Commission should have interference?

The Speaker: Minister . . . .

Hon. M. Farnworth: The Gaming Commission has a job to do, and I have every confidence that they'll be able to deal with the hon. member's concerns.

The Speaker: First supplementary, the member for Chilliwack.

B. Penner: The minister says that some charities may have to wait a while. Well, on Vancouver Island they've been told that they'll have to wait till January 1, 1999, because this government's too busy getting its hands on the money first.

Last year, as a result of the raffle, $7,000 went to recreational programs for underprivileged children, $500 went to an epilepsy support group and $3,000 was earmarked for the RCMP bike patrol squad. Now, that might not sound like a lot of money to an NDP government that spends millions of dollars on misleading advertising campaigns, but it means a lot to children who need funding to get into community soccer leagues.

Will the minister today commit to the people in Chilliwack and the charities that depend on that money that he will personally expedite this application process?

The Speaker: The Minister of Employment and Investment.

Hon. M. Farnworth: Thank you.

Interjections.

The Speaker: Order, hon. members. Minister, before you begin . . . .

Interjections.

The Speaker: Hon. members, hon. minister, order, please.

Minister, go ahead.

Hon. M. Farnworth: Thank you, hon. Speaker. I find it interesting to hear the comments of the opposition, a party that can still siphon a million dollars of taxpayers' money for a phony mailout. I find it interesting that we have a member of the opposition asking me to interfere in the day-to-day workings of the Gaming Commission, a body that is independent and at arm's length from the government. I will not interfere in the activities of the Gaming Commission.

T. Nebbeling: Every year hundreds of small charity organizations in British Columbia hold raffles to fund important community services. As a direct result of this govern-

[ Page 8728 ]

ment's rush to take over the gaming industry and run roughshod over charities, charities will now have to wait until October and in some cases until January 1999. Will the minister responsible for gaming tell us why charities that have run raffles for years are now being told that they cannot even apply for a licence this year?

Hon. M. Farnworth: I guess it's the same answer as to the member over there. The Gaming Commission is a body that operates independently and at arm's length from the government. The fact of the matter is that the process has not changed in the last ten years. Charities still apply with the same forms; they still go through the same process. If the hon. member knew that, he would realize how stupid his question really is.

The Speaker: First supplementary, the member for West Vancouver-Garibaldi.

T. Nebbeling: I think the minister is really gambling with the well-being of many hundreds of small communities and their charity organizations. He should have no pride in being part of that.

The government's response to the applicants was a form letter. The essence of the form letter was: thanks, but no thanks. As my colleague stated, the letter blames the volume of casino applications for the ministry's refusal to process raffle applications. Can the minister responsible for gaming tell us why he thinks that small charities should take a back seat to the NDP's casino applications?

Hon. M. Farnworth: The hon. member clearly doesn't understand that the charities, whether they're small or large, don't take a back seat to anybody. In fact, the Gaming Commission is a body that is independent and at arm's length from government. They are charged with administering and dealing with applications for charity revenues in this province.

Hon. Speaker, we have listened to the opposition saying that government should not be interfering in the gaming process in that regard and that they should not be making decisions as to who does and does not get a licence. Well, the Gaming Commission makes those decisions and will continue to make those decisions, and this government will not interfere in how those decisions are made.

Orders of the Day

Hon. D. Lovick: In Committee B, I call the estimates of the Ministry of Forests. In Committee A, I call the estimates of the Ministry of Employment and Investment.

The House in Committee of Supply B; P. Calendino in the chair.

[2:30]

ESTIMATES: MINISTRY OF FORESTS

(continued)

On vote 44: minister's office, $436,000 (continued).

Hon. D. Zirnhelt: We have been endeavouring to put together the information that was requested, and we are going to start with FRBC. There are some FRBC questions, and I'll try to respond in general terms. On silviculture, you asked for information about some of the target amounts between the coast and the interior. You asked about the contract for the timber jobs advocate and for information on the Empire Valley Ranch and the FRBC's role and the Ministry of Forests role in that. We may want to get into some of that, but first of all, with respect to the areas of silviculture treatments for the 1998 . . . .

Interjection.

Hon. D. Zirnhelt: I'll send this whole package across to you.

There is a detailed breakdown between the interior and the coast on brushing, fertilization, juvenile spacing, planting, pruning and site prep. In general terms, something like 72 percent of that amount is now assigned by way of contract. You'll remember that I said that these are targets, which get translated into actual deliverables on a company-by-company contract basis. This is where the three-year, multi-year investments come in.

With respect to the contract for the jobs advocate, I committed to provide certain information. The contract is between Mr. Wouters of FRBC . . . . It was signed by Doug McArthur, deputy minister to the Premier, and Jake Kerr on behalf of industry; they are serving as interim directors of the company until the board of directors is established. They are also the co-chairs of the government-industry committee which is overseeing the accord and which Mr. Wouters reports to. The term of the contract is five years. Mr.

Wouters will be paid $168,000 per year, and he will receive benefits similar to those received by a deputy minister, with industry paying the difference between what would normally be paid by government to a deputy minister and what is being provided under this employment contract. The contract does not provide for an extension beyond the five years.

With respect to the Empire Valley Ranch, you requested written responses to the questions, and I am pleased to send those over for you. There is a long chronology which addresses when FRBC did certain things and when MELP -- the Ministry of Environment, Lands and Parks -- did certain things.

With respect to the timber cruise completed on Empire Valley, the cruise was carried out by Simons Reid Collins, which is a forestry consulting firm. It was completed in September of '97. The project was managed by Environment, Lands and Parks and funded by Forest Renewal through its agreement with the ministry. I have also provided information on the cruise who did it, the level of accuracy, the number of cubic metres that were traded, and so on.

Just as a preface, the Ministry of Forests was not the ministry that decided on the relative quantums. We provided advice on terms of reference to the Ministry of Environment, Lands and Parks, should they want it, but the studies were all undertaken by that ministry. That minister is prepared to get into the details. This will be of particular interest to the member for Peace River North. The information will be available from the Minister of Environment. I'm prepared to answer questions related to FRBC's role and the Ministry of Forests' role.

G. Abbott: I want to thank the minister, first of all, for making available the materials which we discussed on Friday. I think perhaps, in order to keep things flowing along here, what we will do on this side of the House is try to review this material as the day goes on, so that we don't spend time now asking questions about things which we can read about in the

[ Page 8729 ]

written response here. So perhaps what we'll do in the interim, because we'll likely pick up some questions from these reports -- hopefully, a lot of our questions will have been answered by these reports, but there may still be some -- is go through these just to ensure that all the relevant questions have been answered. But we won't go into them now, so that we have an opportunity to review the material before we do that and don't waste any time of the House in doing this.

The one other issue I'll just remind the minister of is the question which I closed on a few days ago, around

section 8 of the Ministry of Forests Act, with respect to the statutory obligation of the ministry to have the five-year schedules for 1997-2002 in the five-year forest and range resource program, and the absence of that. Is the minister able to deal with that question now?

Hon. D. Zirnhelt: Yes, I can; I do have an explanation. I'll give you the short explanation. The Ministry of Forests officials that have that information are waiting to come in when we've done with FRBC, but I'll just give you the short explanation.

The planning which was once done by the Ministry of Forests with respect to silviculture is now done jointly -- the program planning, how much is spent in which

section of silviculture. It's done at a planning table that involves FRBC, the ministry and the licensees, because the licensees are the delivery agency, particularly for industry-outstanding material which is funded by FRBC. The silviculture plans are provided by the ministry. Then it's done at a planning table. So that's the short explanation. I am prepared to provide you with fuller information and some details referring to the schedules.

G. Abbott: We will come back to that one. I do have some additional questions and comments to make with respect to that issue, but we'll leave it until the minister has the appropriate staff with him to deal with that. I think that was all that we were looking for at this point in time. As I say, we'll be reviewing this. I will review it with some of my colleagues, perhaps at a little break later in the day -- where we're at in terms of questions arising from the jobs accord advocate, the purchase of Empire Valley Ranch and the enhanced silviculture issues and requirements.

The issue that we were debating at the time we departed at 1 o'clock on Friday was the issue of New Forest Opportunities and issues about the collective agreement and how that would operate. It is a new approach in British Columbia. My colleagues and I certainly expressed a variety of concerns around that on Friday. We don't propose to beat this to death again today. I do want to briefly recap where we were in that discussion, from our perspective at least, and why we have ongoing concerns with this approach, described as New Forest Opportunities Ltd., on the coast of British Columbia.

It seems to me that there are four different ways that Forest Renewal B.C. and the government of British Columbia can proceed with respect to assisting displaced forest workers in acquiring employment in the silviculture industry -- if they are in the unfortunate position of being unemployed and should they choose to do that. I think that one way -- and we've talked about this one -- is to use existing programs and mechanisms. Indeed, up until 1998 this is what we did. And 1998 is not the first year that we have had displaced forest workers. It is kind of an ongoing problem in a cyclical industry like forestry.

Periodically we have far more unemployed forest workers than we would like, but there are always some displaced forest workers, even in the good times, depending on local conditions and problems. So over time we've had forest workers moving into the silviculture industry and vice versa. They used existing programs and mechanisms to achieve that. So that's one way we can do it. Obviously the government would argue that that is inadequate to deal with a problem of the magnitude we have today, at least in the coast region. But that is an opportunity, and it's one way to go.

I would suggest that another model for dealing with the displaced-forest worker problem is a registry, whether it is operated by communities, industry, employment insurance offices or some other method. A registry would seem to be an appropriate way to deal with this as well, given that the industry would certainly want to commit to assisting in the delivery of displaced forest workers into silviculture wherever possible. That's a second model.

A third model -- and it seems to me that this has some merit as well -- is a model where we may have voluntary unionization, and where collective bargaining occurs between silviculture/forest workers and silviculture and other forest companies. It is, I guess, traditional that we have free collective bargaining, that people choose whether they wish to be unionized or not unionized. It is a choice that they make.

[2:45]

It seems to me -- and again, I think we laid out our concerns in this regard with considerable force on Friday . . . . I don't propose to repeat all of that again. But what we have in New Forest Opportunities Ltd. is a model of worker employment that I don't think has any place in a province, a nation with our democratic traditions. The genesis or the evolution of the New Forest model, in fact, starts in Cuba. I don't use the term "Cuban labour model" lightly. That is in fact where the model originated. It's a model where workers don't voluntarily unionize.

It's a model where they don't engage in free collective bargaining to determine their working conditions, their rates of pay and so on. It's a model that is very much state-controlled. That's exactly what we have here with New Forest Opportunities. We have a model that has been imposed on an existing productive and efficient silviculture industry, and it's imposing an ideological view held by the government on an industry that, frankly, neither welcomes it nor, do I think, needs it.

We have this imposed model, imposed by government -- forced unionization, whether workers choose it or not. As a consequence of that, workers are deprived of (

a) their democratic right to unionize -- if they choose -- and (

b) their right to influence, in any meaningful way, their rates of pay, their working conditions and all of the things that we associate with free collective bargaining in this province. Again, that's by way of bringing us back to where we left off: our very profound and very serious concerns with the New Forest model that has been imposed in British Columbia.

[J. Doyle in the chair.]

I have a few more questions with respect to this issue. Then, I guess, we will move on to the jobs and timber accord and the numerous questions that the opposition may have around that. Others of my colleagues may have further questions on New Forest Opportunities, as well, but I think I can finish up this

section in relatively short order.

My first question this afternoon, in terms of New Forest Opportunities . . . . This relates to the coast, and it relates to machine operators. I've had calls from a few of them in recent weeks. Their concern is this. In the old system -- if that is what we can call the way things were conducted last year and

[ Page 8730 ]

in previous years -- machinery operators have spent most of their time doing jobs and contracts in the private sector. Over time they have augmented that or filled in portions of their workyear by taking on machinery operator jobs on FRBC trail development, for example, or they may have been engaged to do remedial work -- riverbank restoration and that kind of thing -- through FRBC-funded projects.

I hope the minister can correct me on this and lay out precisely what can be done to remedy this. My understanding is that machinery operators who have worked on these kinds of projects in previous years are finding, in 1998, that they are not being welcomed into the New Forest Opportunities fold because they have not had . . . . I can't recall the exact figure, but I think it's 200 hours or something in the previous year. At any rate, they find themselves effectively frozen out of this kind of machinery work that was offered by Forest Renewal B.C. in previous years.

It's a serious issue for them, because in some cases they have invested $80,000 to $100,000 in a machine. They need to keep it working in order to make the payments on that machine, and because of the new model they are concerned that they are effectively being frozen out of further work with New Forest Opportunities or with Forest Renewal B.C.

My questions to the minister are: (

a) is he familiar with this problem, and (

b) how are we going to deal with this in a way that will be fair to those machinery operators as well?

Hon. D. Zirnhelt: The whole idea behind multi-year agreements and moving to a model which provides for training and so on was to allow for some continuity of employment and to allow the industry, which would be overseeing these projects, to plan through the years and seasons to keep as many people going as possible. The objective was not to keep everybody who was working in the rush run-up to the big funding year -- which was last year, with over $600 million. We spent that because it was available and there was work needed.

But the idea of the model was to ensure that people who had a history in the industry -- two years of employment and a certain number of hours -- would be on the priority list for hiring. That's the point: displaced forest workers.

So if a machine operator is not a displaced forest worker, then they don't qualify. I don't know what we could do to fix that particular situation; but if you have the details of someone's situation, we'd be happy to look at it and see if there's a glitch in the way it was set out -- the work, the terms of the contract and the programming -- to see what can be done about it. But we will be doing less work this year than we did last year; and probably more last year . . . . So there's less work to go around.

All we've said is that everyone who has paid his or her dues in terms of the amount of time he or she has spent in the industry, and who truly is a displaced worker, qualifies. I don't think everybody can be kept whole -- not when the pie is shrinking and there's an increasing demand to provide equal opportunity for people from whichever part of the sector they're displaced from. So if a machine operator truly was employed in the forest industry for two years and had the requisite number of hours each year, he or she would then qualify as a displaced forest worker.

G. Abbott: I'm not sure whether this goes to the heart of NFO or not. I hadn't thought of it in those terms, but as the minister was speaking, I was beginning to sense that. Let me put it to him this way. If Forest Renewal B.C. has undertaken a watershed restoration project, and if, as a part of that watershed restoration project, that trail-building project or whatever it happens to be, there is a machinery component . . . .

The argument I'm hearing from the machinery operators and small business people who've bought machines and are trying to make payments on them and keep their heads above water is that under the new model, they're being frozen out of that kind of work. Forest Renewal or New Forest Opportunities are bringing in machines, and people are being trained on those machines.

In the process of one group being assisted to the extent of not only training but also being brought in from some distance, put up in motels and all the rest of it so that they can be recorded as a job created, the existing machinery operators, who have invested in their machines, are being frozen out of that work.

It seems to me that if that's the case, then we have imposed on this model a rigidity which is counterproductive to this society and to this economy. I'd like to the minister to comment on this, and to confirm whether that's the case -- and if it is, on whether that seems appropriate.

Hon. D. Zirnhelt: The decision on who gets contract and subcontract work is a decision made by the licensee if they got the money under a multi-year agreement. It's whoever the delivery agent is; it might be the Ministry of Environment or the Ministry of Forests. I'm told that there is an exemption for operators on watershed restoration projects. They are exempt from requirements of NFO because it was felt that putting trainees on someone else's machine wouldn't work. It was much too awkward.

So that would be provided by way of some arrangement, whether it's direct hire on some contract or on a subcontracting basis. The information I've had is that there is an exemption from NFO for operators on watershed restoration.

If a company has decided on a different delivery model, and they want to use their crews and move them from enhanced silviculture one month into watershed restoration in another, then they may be doing some of the work, but there is that exemption in place. Again, that's why I asked if you have the details. It may be that we've accounted for it, and there may be some explanation other than the nature of the NFO contract.

G. Abbott: That's a step in the right direction if there is indeed an exemption for the machinery operators. If there is anything further that the minister can provide to me with respect to that issue and how exemptions are achieved and so on, that would be useful. Certainly the machinery operators that I've spoken to . . . . Again, these are individuals who own their machines and who want to get this kind of work. If there is some process for obtaining the exemption or expediting the exemptions or whatever -- I'm not sure how that's done . . . .

But whatever information the minister might have on that, I'd certainly appreciate it if he could provide it to me. The impression of the machinery operators when they contacted New Forest Opportunities was that there was simply no place for them. So it would seem that at least under the broader umbrella of Forest Renewal B.C., there may indeed be some opportunities for them. If the minister could outline the processes whereby exemptions could be obtained, and that kind of thing, I think it would be very useful.

Further, I want to inquire about the collective agreement. We could go to page 11 of the collective agreement, which is the IWA-Canada checkoff. Could the minister advise whether the amounts for union initiation fees, union back dues and union dues per month are items which New Forest Opportunities negotiated with the IWA?

Hon. D. Zirnhelt: We don't have the details about how it's being implemented. I understand there's an implementa-

[ Page 8731 ]

tion committee that will be dealing with it. We'll get the information and get it back to you.

G. Abbott: The reason I'm interested is to know whether New Forest Opportunities concluded some agreement with the IWA with respect to what the amount of the initiation fees would be and what the amount of the union dues per month would be -- whether it was something which would be a product of negotiation rather than a product of agreeing that the IWA could set whatever level was appropriate. Could the minister advise which approach has been used?

Hon. D. Zirnhelt: The information I have is that it will be the product of discussions between the parties. I'll bring that to you.

G. Abbott: That surprises me a little, given that a number of people are already employed under this method by New Forest Opportunities. It's curious to me that it hasn't been determined yet, given that there should be some people who have been receiving cheques and presumably have been involved in checkoff at this point. But we'll leave that for the moment and ask again a little later when that information might be available.

Could the minister advise what amount constitutes the communication/advertising portion of the $2.2 million budget -- I believe it was -- of New Forest Opportunities?

[3:00]

Hon. D. Zirnhelt: Yes, we can provide that information as part of the information that's available for discussion around the business plan. I don't have that line-by-line breakdown of the budget here.

G. Abbott: I'll return to that question later on, when we can have that available. I'd like to know that, and I'd also like to know -- just to give the minister some advance notice so he can pick this one up, as well, prior to the end of estimates -- what the budget of the jobs accord advocate office is for communications, advertising and so on. That's something I'll be wanting to know down the line.

I want to briefly turn to the information the minister has provided today around areas of silviculture treatment, and I want to deal with this in relation to New Forest Opportunities. The 1998-99 business plan shows an estimate of . . . . "There were 38 planning units throughout the province that used the Ministry of Forests five-year silviculture plan, backlog plan and industry plans to select projects to be done. The current breakdown is estimated to be . . . .

" And it goes through brush and fertilization, juvenile spacing and so on, for a total of 21,571 hectares on the coast and 103,294 hectares in the interior. Just for my education, are we talking of the objectives under the 1998-99 business plan, or is the portion that is to be achieved in the current business year something less than that?

Hon. D. Zirnhelt: The objective target estimates are still the same as in the business plan. These are where we're at now. In my opening comments, I said that this is where we're at in terms of having contracts in place and details of where it will be delivered.

G. Abbott: So in the current business year for FRBC, we are still aiming for a total treatment area on the coast of 54,000 hectares and a total for the interior of 118,000 hectares, for a total of 172,000 hectares. Is that correct?

Hon. D. Zirnhelt: Yes. That's the bottom line on that page of the business plan for '98-99. Those are still the objectives.

G. Abbott: What I'd like the minister to do while we're engaged on New Forest Opportunities is to advise me what percentage of those treatment areas on the coast will be subject to the New Forest Opportunities model. Is it 100 percent, or is it something less than that? I know that some or perhaps a very considerable portion of this work on the coast will be done through the multi-year agreements with the major licensees. Does the New Forest Opportunities model apply in every case or not?

I know that there are some that the IWA is doing directly and that community groups are doing directly, and so on. What I would like . . . . I don't need a precise breakdown, but I do need some indication on the 54,000 that are planned for treatment in 1998-99. What portion of that will be done under the NFO model? Presumably, the 1,300 hectares of planting would not be a NFO treatment area. But of the rest, could the minister explain where NFO applies and where it does not?

Hon. D. Zirnhelt: The member is correct. On the coast, 1,300 hectares of planting won't be covered, but the brushing, fertilization, juvenile spacing, pruning and stand improvement -- depending on how it's done -- could be. The fertilization is done by air; it wouldn't be -- it would be all aerial contracts.

G. Abbott: Just to make sure I've got it right, then: of the list, the fertilization and the planting would not be NFO model treatments, and there's some question about site prep and stand improvement -- those may or may not be, depending on what occurs there. But for the balance -- the brushing, the juvenile spacing and the pruning -- is the minister suggesting that for those three treatment methods, the New Forest model would operate in every instance?

Hon. D. Zirnhelt: With the possible exception that there are technical people who may be hired to do a certain amount of prescription or organizing. The actual work, though, would be.

I said about the fertilization . . . . There may be hand fertilization, if that's the case; I don't have people who know all the technicalities of how we fertilize. But as I said, if it's aerial, it wouldn't be, because we don't expect a NFO employee to be put into an airplane; it would be a contract.

G. Abbott: So will there not be comparable, competitively tendered work done alongside the New Forest model to test or measure the efficacy of the new model in relation to what's been done before? Or in Forest Renewal B.C., does the minister look to a comparison between the coast and the interior, in terms of the efficiency of the delivery of those kinds of enhanced silviculture methods as a way of testing the proposition that New Forest Opportunities is an efficient and productive model?

Hon. D. Zirnhelt: There's a number of things I can say about that. Any of the 250,000 contracts of $250,000 or more have to be tendered. By way of evaluating it, what happens is that each industry partner will have to do value-for-money audits. And there is going to be, as you know, on private land -- particularly on the coast; there is private land . . . . So industry does have an idea of its costs associated with private land treatments, which aren't covered by this. In coming up

[ Page 8732 ]

with the rate structure, we looked at what was going on in the industry and did the Price Waterhouse study, as you know. We received submissions and looked at the information from the silviculture industry to try to arrive at a fair remuneration based on industry standards.

G. Abbott: The issue is an important one. Again, I don't propose to deal with this today with the intensity that we did on Friday. I think we've made very clear the concerns we have around this. From a business perspective, the concern will be that New Forest Opportunities contains in its approach an element of uncertainty, which is inevitably going to be reflected in the contracts that are let under the provisions of NFO.

We can have an interesting argument about whether or not that will occur, but I think that what we need more than anything is a reliable, accurate way to measure whether in fact that's the case. We need to be able to look at this and say, "Under these conditions we routinely had lower bids per hectare for brushing than we did under the New Forest method" -- or vice versa if that happened to be the case. Unless we compare coast and interior -- and we'll almost immediately run into an apples and oranges argument when we do that . . . . But we need some way to accurately measure the fiscal consequences of the new approach.

That doesn't appear to be possible, however, under the approach that's been adopted. As I see it, there is effectively a monopoly being introduced in terms of the model that's going to be used on the coast, so it may be difficult to measure that. Undoubtedly we'll be hearing a lot about this issue from a lot of people, as the advantages and disadvantages of the approach become more obvious as the year wears on.

To go back to the original question about New Forest Opportunities delivering opportunities for both union and non-union . . . . I'm still not clear, particularly after our discussion here, where the opportunities are for the non-union guys. It doesn't seem, at least on the coast, that a non-union firm, unless they are prepared to submit to the New Forest model . . . . There are no contracts which they are able to bid on. I think we've confirmed that already, but if the minister has any comment on that, I'd be pleased to hear it.

Then we will probably be moving on -- at least, pending the minister's advice about the process involved in determining the IWA checkoff rates and the communications budget for New Forest Opportunities. I would like to hear about those before the end of estimates.

Hon. D. Zirnhelt: I have the information; it's $80,000 for the New Forest communications.

[3:15]

B. Penner: I seek leave to make an introduction.

Leave granted.

B. Penner: It's my pleasure today to introduce about 20 grade 6 students from Chilliwack Christian School. They are accompanied by ten adults, including their teacher Ms. Barb Stronks. I just had an opportunity to speak to the students outside the Legislature, and they challenged me with a variety of questions about what we're attempting to accomplish here. Would the House please make them welcome.

G. Abbott: I think the important point is whether the contracts are done by direct award or by competitive bid. The point is that on the coast we have confined all of those to the New Forest model. There is no opportunity -- and we find this utterly philosophically objectionable -- for those who, because of their concerns, do not wish to become part of a union. There are lots of silviculture workers who feel this way. The minister makes reference to the past, when we saw abuses where people didn't receive the kind of remuneration they should have, and so on.

But there are a lot of people who have worked in silviculture for years -- and in some cases for decades. They love the life, they work very hard, they work very efficiently and they find it entirely objectionable that they are now being pounded into a slot called New Forest Opportunities that may, in many ways, limit their opportunities to exercise their initiative.

I guess we've gone around the bush on this a few times, and we are not finding common ground. Frankly, I think that experience will demonstrate that this approach by this government is (

a) an ideological one, and, in a more practical sense (

b) a faulty one. We certainly object to it on that basis, and we most profoundly, most basically object to the forest unionization of people who may or may not want it. We have certainly gone through that in some detail, on Thursday and Friday as well.

I think that concludes my questions on New Forest Opportunities, and unless others of my . . . . Pardon me. My colleague has a question.

D. Symons: Just to follow up on a question I was asking the minister last week . . . . He may remember that I was asking about people involved in silviculture or tree-planting, particularly about the possibility of students who were doing it . . . .

I think the minister informed me that if a tree-planter has 700 hours in two years, and more than 65 percent of their income came from the tree-planting -- which I think could fit a lot of students, because in a four-month period one might get that number of hours in -- he or she might get a workforce transition program that could basically pay his or her university tuition and expenses up to about $21,000 a year -- for maybe three or four years of a university course. I gather, from what the minister was telling me, that this is a possibility.

Just another angle on that particular question that I might ask the minister, because I think it fits in with the hon. critic's questions at the beginning of this session: can the minister

[ Page 8733 ]

confirm that if these students leave tree-planting because they're basically offered an incentive to go back to university and do not need to tree-plant in the summer -- they're now going to be funded for their college rather than having to earn that money -- preference would be given for an opening in the tree-planting program to someone who has been a displaced forest worker? Would they receive preference in filling jobs in the tree-planting industry?

Hon. D. Zirnhelt: The answer is no.

D. Symons: The minister is saying that basically anybody who comes along and asks for a tree-planting job would be eligible for that job. Where I'm leading on this is . . . . If you do have people who are displaced forest workers coming into that job, we have something called Bill 84, 1992, which says that these fellows who are coming in could have an IWA membership in their hip pocket. I think you mentioned last week that tree-planting is one of the facets that does not require belonging to a union to get that FRBC money.

I'm wondering if there might be a backdoor approach, through Bill 84, which basically says that if you hire enough people who had a union membership through some other job they had previously and who then come into tree-planting, after a while you hit that magic 55 percent and voilà -- automatically, no secret ballot is needed. That particular employer would now have this employee group certified as the bargaining unit and therefore would have it unionized. Is that not a possibility?

Hon. D. Zirnhelt: Tree-planting is exempt; it's not covered by the NFO agreement.

D. Symons: They are exempt in the sense that they do not have to be in a union to get the job to begin with. I'm wondering if the minister can clarify, if they're exempt, whether the workers decide. Or if they have 55 percent and happen to have an IWA membership in their back pockets from previous employment, there would be no possibility that they could seek unionization. Is that what you mean by exempt -- that they will not and cannot be unionized?

Hon. D. Zirnhelt: The point I've been trying to make is that tree-planting is not covered. We just went through this. Tree-planting is not covered by the New Forest agreement.

D. Symons: What I'm getting at is that although it's not covered by the facets of Bill 84 of 1992, it would be possible that through time and attrition in the student population of tree-planters, they could bring in forest workers who previously had an IWA membership. In that sense, they could become unionized. I'm just seeking confirmation that this is a possibility.

Hon. D. Zirnhelt: As I say, it's a Labour Code issue. I don't why we're discussing it in the Ministry of Forests estimates, because in New Forest tree-planting is exempt.

G. Abbott: Just so we can move along in an orderly fashion, my colleague from Peace River North has had an opportunity to review the follow-up materials which were provided by the minister. I will ask him now to discuss those, and I will review the material that has been provided, with respect to the jobs accord advocate. After the conclusion of a discussion around the purchase of Empire Valley Ranch, I would see us moving along to our review of the jobs and timber accord.

R. Neufeld: I'd like to start off by thanking the minister for the notes he sent over on some of the questions that were asked last week. I don't have a lot of questions surrounding the Empire Valley Ranch. They won't deal too much with Forest Renewal B.C. but rather with the ministry's role in the Empire Valley Ranch. Hopefully, we can get through them fairly quickly.

My first question is: what process was used to evaluate the Empire Valley Ranch? When was that evaluation first done for government?

Hon. D. Zirnhelt: I said in my opening remarks that the decision around the purchase was made by Environment, Lands and Parks; it was not made by the Ministry of Forests. The role of the Ministry of Forests was that of providing advice and terms of reference for assessments that were done. Other than that, it was not the Ministry of Forests that did the purchase.

R. Neufeld: I realize that there is an involvement with the Ministry of Environment. That's in fact true. The Empire Valley Ranch is in the minister's own constituency. I would think that as a Minister of Forests -- and the fact that there was a trade-off of timber values in the Peace country to purchase the Empire Valley Ranch -- he would have some involvement with and knowledge about what was going on. Is the minister telling me that anything to do with the purchase of the ranch, or evaluating it -- any of those questions -- will be deferred to the Minister of Environment and that the Minister of Environment will take all the questions on that issue?

Hon. D. Zirnhelt: The evaluation was done by Crown Lands. We had peripheral involvement when called upon to advise on timber values. But as a minister, I was not consulted on timber values; it was part of the overall land trade. Yes, I have confirmed with the Minister of Environment; she's prepared to answer all the questions around it. This isn't a dodge from one minister to the other; the minister responsible -- who has all the information, whose ministry conducted the appraisals and the negotiations -- is prepared to answer those questions.

R. Neufeld: I guess the reason that I thought that the minister would have some knowledge -- or have some people in the House to deal with these issues -- is because anything that I see that was sent out about the purchase of the Empire Valley Ranch was signed not just under the Minister of Environment, but also signed under the Ministry of Forests, whether it was letters sent to the Alaska Highway News to explain to the people that the deal that was signed by your ministry and by yourself, along with the Ministry of Environment.

When I see other letters to the Ministry of Forests from other people who had some problems with it, your ministry dealt with it fairly straightforwardly. So it would seem natural to me -- and I guess that's probably part of the problem . . . . You must understand that I'm a bit suspicious of just transferring all of these questions over to the Ministry of Environment, because I'm sure the Minister of Environment is going to say at some point in time: "You should have asked those questions in the Ministry of Forests estimates."

So when I go through all the documentation, I come up with your signature as the Minister of Forests. Maybe what we can deal with . . . . I'll try to deal with some of the things that would be very specific to your ministry. Possibly you could tell me if you know -- as the MLA for the region -- how

[ Page 8734 ]

much timber was logged off the Empire Valley Ranch by the past owners, Vesco Contracting, prior to FRBC purchasing the ranch.

[3:30]

Hon. D. Zirnhelt: I provided some written information; I'm just checking to make sure you got it. It said: Empire Valley is about 11,000 hectares, and 140,000 cubic metres of conifers are left on Empire Valley Ranch. Only about 100 loads -- 3,000 metres in total -- were removed from the ranch.

R. Neufeld: I guess I have not received in total the package of information that was sent to me. Maybe in that portion of what I did not receive, the minister could tell me what the quality of the wood was on the Empire Valley Ranch in comparison to the wood exchanged in Peace River North.

Hon. D. Zirnhelt: It was a value for value, but in preparing for the estimates I said that that was part of the appraisal and part of the negotiation -- part of the dealing. The Minister of Environment is prepared to answer those questions.

R. Neufeld: I asked these questions to the minister because I'm sure that when I stand up and ask the Minister of Environment what the quality of the wood was at the Empire Valley Ranch, the minister will very curtly say: "That is a question that you should ask the Minister of Forests. I would think that it would be the Minister of Forests that would be responsible and who would have the people who are knowledgeable about those issues."

I've quickly read my notes again. The information that you sent across the way to me was about the cruise on the Empire Valley Ranch. You state who did it and when it was done, but no cumulative amounts of any kind. The cumulative amounts that you have are for the land in Fort St. John or Peace River North.

Hon. D. Zirnhelt: The information I quoted was on the next page. Perhaps it was missed in the photocopying.

R. Neufeld: Then we'll ask about silviculture obligations on the Empire Valley Ranch. Will that be performed by the Ministry of Forests?

Hon. D. Zirnhelt: There was a misunderstanding; it took us time to clear it up. There are no outstanding silviculture obligations on that land -- on the ranch.

R. Neufeld: I'd like to go to the land in Fort St. John. By the way, I didn't get this copy of . . . . I guess it got missed in the photocopying. But I'd like to go to Fort St. John. Again, the minister may want to defer this question to the Minister of Environment, but I'll pose the question. Was Vesco given the opportunity to pick wood anywhere in the province in exchange for the Empire Valley Ranch? If so, is that in writing?

Hon. D. Zirnhelt: Yes. Lands was doing the negotiation, as the member remembers, and we were consulted in the process. But it was Lands that steered the overall negotiations. It's my understanding that they were asked where they preferred the timber and lands for the exchange. Beyond that, I don't know anything more.

R. Neufeld: So, to the minister's knowledge, they were given the opportunity to go anywhere in the province and log approximately 150,000 cubic metres of wood. Would that be a correct statement for me to understand from the minister?

Hon. D. Zirnhelt: I guess it would be accurate to say that in the process of negotiation they stated their preference as to where they would like it. So it was a product of the negotiation. I don't think I can help the member any more than that, because the staff responsible for the negotiations and the details were employees of the Ministry of Environment, Lands and Parks. That minister has that file and is prepared to discuss the negotiations.

R. Neufeld: Maybe I'll just briefly ask the minister if he wants to deal with consultation with affected parties in the northeast or if he would like to also defer that to the Minister of Environment?

Hon. D. Zirnhelt: The Ministry of Forests involvement is roughly as follows: they were asked to be brought in to discuss the impact on the grazing licenses -- the grazing tenures -- that were there. There was some discussion around impact on woodlot licensing. We were brought into the consultations at some point, but I repeat: the consultations were conducted by Lands; they were in charge of the consultation process.

R. Neufeld: The consultation process that took place when the Ministry of Forests was brought into the picture . . . . Was that after the deal had been made, after I had been informed that there were some secret dealings going on in Fort St. John to exchange land and timber in Fort St. John for the Empire Valley Ranch -- or prior to that?

Hon. D. Zirnhelt: I'm informed that there were discussions before and after. There were some early discussions with the impacted ranchers, and then afterwards there were discussions and consultations with respect to implementing the decision. So both before and after.

R. Neufeld: If there were discussions with the ranchers involved prior to that, could the minister please tell me who they were? And I don't mean specifically ranchers. Was it the Upper Cache Creek Cattleman's Association? Because I'm afraid that they were not involved. At least they were very clear on that issue: that they had not been consulted in any way, shape or form until after the deal was done.

Hon. D. Zirnhelt: We can get the information, and we can discuss what they were consulted about. But as I recall, they weren't consulted specifically about specific potential owners of certain lots. The impact on grazing and the management of grazing in the area were discussed as part of the fall consultations with, I believe, one of the groups that you mentioned. I'll get the specifics; I don't have it with me, and my advisers don't have it, but we'll get you the names of the ones that were consulted. We may have this on public record already -- it was information that was available at the time of the announcement -- but I'll get the details of that for you.

I know the issue: the argument is that it wasn't a public process. Well, in defence, the answer is: we don't negotiate in public when we're dealing with land trades or land sales. They're not public negotiations.

R. Neufeld: The minister keeps talking a little bit more about consultation and his involvement in the deal, and it seems as though there was a little bit more involvement than what he let me know to start with.

[ Page 8735 ]

But the president of the Upper Cache Creek Cattleman's Association was adamant that they were not party to any discussions surrounding grazing. Whether or not they knew about Vesco is beside the point. But they told me -- and have it on record in writing -- that they were never advised of any changes, or any dramatic changes, that were going to take place in that part of the province that they are responsible for. So I will be very interested to receive from the minister who the discussions were with, and about what, prior to the exchange for land in Peace River North for the purchase of the Empire Valley Ranch.

The other thing is that the Upper Cache Creek Cattlemen's Association had agreements with the Ministry of Forests and the Ministry of Environment that they actually would be party to any discussions about changing the land use or logging. In fact, there was a Blueberry forest reserve put over the area many years ago. That was part of the discussion at that time -- that cattlemen in that area would be advised of any dramatic changes. Unfortunately, they are of the opinion that you didn't live up to that agreement of the Blueberry forest reserve. Maybe the minister has a comment on that.

Hon. D. Zirnhelt: I'd be happy to provide the member with an explanation as to how we discharged any obligations we had in the area. I'll just preface it by saying that the negotiations that were taking place with Lands were confidential in nature; therefore, there was limited disclosure that could take place. We will get you the information about the nature of the consultations and provide that to you.

R. Neufeld: You know, when I think about the issue of the time . . . . The minister is adamant that there could not be any consultation with people in the north about these issues, knowing full well the dynamics of what was taking place -- that this timber was actually going to leave Fort St. John in log form and go to Prince George.

The minister would obviously know that that would bring some fairly serious concern, especially when these were woodlots that were turned back to the Crown because, by the minister's own admission, with the high cost of silviculture, the high cost of stumpage, royalties and all the issues that go around harvest plans and those kinds of things, people could not make a buck out of those woodlots. That's why they went back to the Crown.

The minister knows full well that there would have been a lot of people upset had they known that he was going to turn that land over, fee simple, to a logger from Prince George to come in and log all that land and move all those logs down to Prince George to compensate for buying a ranch in the Cariboo. I don't think people in the north had very much problem with the government of the day purchasing the ranch in the Cariboo; I don't think they had a lot of trouble with it at all.

In fact, I think this whole issue could have been handled a lot better had the government had the will or the desire to come to the north and say, "Folks, this is what's going to happen to accomplish this," rather than doing the whole little deal in secret, behind closed doors, with different individuals, in the guise that you can't do it in public.

[3:45]

That's Crown land up there. You weren't dealing with private land in the Peace River country; that was Crown land, owned by the Crown. Why in the world would you have to say to people in the north, to make a deal like that: "Because it's a private deal, we cannot discuss it with you folks"? That's other than the native bands, who you discussed the whole deal with. In fact, by the minister's admission to me, they did. Why could the rest of the people in the Peace country not have been consulted, at least in a general way, about what you were trying to accomplish?

Hindsight is always great. But I think this is one case where you could have gone to the people up there -- as the minister, as the MLA that represents the area encompassed by the Empire Valley Ranch -- and told the people what you wanted to do. You know, I think people probably would have accepted it. But to be given that kind of deal was just about too much for anyone to take. I think the minister knows full well that if the roles were reversed completely, it would be no different; it would be just as bad.

If we were going to buy a historic piece of land in the Peace River country and trade it for a whole bunch of timber in the Cariboo and then take that timber, cut it down and move it to the Peace country to saw it and then sell it, I think you would have the same, if not larger, reaction.

I think it was a terrible way to go about purchasing a ranch that probably was in the best interest of being purchased by the province of British Columbia. But the process stinks. Let me tell you, it stinks big-time where I come from. Even those people who believed in, voted for and probably still will vote for the NDP . . . . They couldn't believe . . . . Your own party that you represent could not believe the process of doing deals in the back room and in the dark, which your ministry went through -- and the Ministry of Environment and your government -- to acquire this piece of land.

In fact, if I had those people standing in this House today, they'd be just as angry at you and your government as I am.

The Chair: Would the member speak through the Chair, please.

R. Neufeld: Through the Chair to the minister, I want to know what . . . . Further to the minister's comments, when he spoke to me personally -- although the Forest Practices Code won't apply, no environmental rules will apply, no stumpage is going to be paid . . . . In fact, after the person has finished logging it, it's going to revert to the Crown, and the Crown is going to be responsible for tree-planting and for all the silviculture and all the environmental upgrade. What role . . . ? In fact, I asked the minister personally how we were going to ensure that watersheds around Fort St.

John for the community's water supply, which would be affected, would be looked after. In the minister's own words, he said to me: "Although the Forest Practices Code will not apply, we will set up a set of stringent rules that that contractor is going to have to abide by."

Mr. Minister, I asked in March, when you completed the deal, for that set of guidelines and for who was going to administer them. To this day, the community of Fort St. John -- my constituency -- has not been told what those guidelines are, even though logging is going on. They haven't been told. You haven't had the courtesy -- your ministry, through the Chair -- of responding to . . . . Actually, it wasn't March. Pardon me. The record says it was February 10 when your ministry was asked what those rules and regulations would be. What is that -- four months ago? Logging took place right after this.

I'm not here to rag on the logger, but I want to tell the minister, and I want to put it on the record, that within ten days of logging, two loads were seized for improper timber marks. By contrast, Canfor, which logs hundreds of thousands of cubic metres yearly, has had one load seized in four years because of improper timber marks. There is no way. I think that you know that the ministry knows how much timber is coming off that land and how it's being tracked and whether it is being tracked.

[ Page 8736 ]

When we had registered professional foresters who actually worked for the ministry in Fort St. John go out and plot that land with the ministry's own maps, we came out with a completely different figure than the 146,000 cubic metres that the minister talks about, which he sent over to me. It's more in the area of 200,000 cubic metres. That's a pretty big stretch. I want to know, first of all, who is responsible for administering how that is being logged and to make sure that environmental concerns are looked after.

Hon. D. Zirnhelt: The member talked about two loads being seized. The information I have is that two loads were discovered at a highway scale to be improperly marked by the truckers as per the regional procedures. Once the truckers were advised, no other occurrences of the infractions occurred. The wood should have been marked on four corners -- two front, two back -- and paint on the sides. It wasn't as though there was anything wrong other than a little problem with the marking, but it was corrected. They have a good system in place, I'm told.

They have hammers on the loading site, and there are instructions to the truckers in writing. There were new scaling regulations being brought in about that time, and they're apparently up to standard on that.

The district office is in charge of scaling. Apparently the scale matches the cruise closely. There are no regulations as such in place, but there was an environmental agreement between the district manager and Vesco, and I understand that Vesco is complying with it. To my knowledge, there are no environmental impacts there. If the member has information to the contrary, I would be interested.

R. Neufeld: First off, about the first two loads being seized: I received that information from the Ministry of Forests office in Fort St. John. That's the information I got. You have some other information, and that's fine. Regardless, two loads within the first ten days of logging had to be either seized or stopped because of improper markings. When I relay that and compare it to Canfor, which logs hundreds of thousands of cubic metres a year and had only one in four years, I don't think that's a very good record right off the bat.

I want to go back to what the minister said about the environmental concerns and those issues that surround the Forest Practices Code. I don't want to get into the whole Forest Practices Code. The minister knows full well that that's now fee simple land; I know it -- there's no Forest Practices Code that applies. But as an assurance, the minister himself gave me the assurance that the ministry, not the district manager . . . .

Between them, the Ministry of Environment and the Ministry of Forests were going to set up some stringent rules -- in fact, we could probably get a copy of that somehow -- as to how logging was to take place on those four plots of land in the Fort St. John timber supply area.

Now the minister says it's just kind of a little bit of a deal between the regional manager and Vesco Contracting. I don't go for that. That's not good enough for me. Is that the reason why the minister has not been able to respond to me for the last six months? If that's how simple it was, why didn't he just write me a letter back and say: "No, we don't really have anything; I didn't really mean that. It's really just a kind of cozy deal between the regional manager and the contractor." Why wouldn't the minister just send me back the letter and tell me that?

Hon. D. Zirnhelt: Who is better suited than the district manager to implement that? He knows the land and knows the logging practices in the area. He's the one who worked on the environmental agreement with the contractor. It wasn't between the regional manager . . . . I'm told it's the district manager. I don't know whether the member would consider that stringent enough, but what you have to get at is: is there environmental damage? If so, I said: "Show me the damage, and we'll see what can be done about it." But I don't know that there is any. In fact, I'm informed there isn't any. So what's the problem?

R. Neufeld: It's absolutely amazing that he would just ask: "What's the problem?" Obviously, if that's all it takes -- a deal cut between a regional or district manager and the logging company -- what in the world do you need a Forest Practices Code for? If there's no environmental damage happening, what do you need a Forest Practices Code for? I mean, you've answered my question. The thousand pages of the Forest Practices Code -- what in the world do you need them for?

Interjection.

R. Neufeld: On private land -- don't give me this. You turned it over. It was Crown land, and you turned it over fee simple to Vesco Contracting for a backroom deal you cut with Vesco to buy a ranch. Actually, I'll go through the cost of it, which was probably about three times as much as what you should have paid in the first place. You bungled the whole deal -- the Ministry of Environment and the Ministry of Forests.

Hon. D. Zirnhelt: The member is getting on a roll here. He can direct the questions about the value of the land exchange and the timber exchange to the Minister of Environment, who is prepared to answer those questions. Just a caution that I won't be answering many more detailed questions.

R. Neufeld: I know it's a bit touchy for the minister. He doesn't like dealing with this, as much as anybody, because he knows that the whole deal was wrong to start with. In the first place, it cost the province about three times as much as it should have because you couldn't make the deal when you should have -- back in 1995.

Can the minister tell me when the Cariboo land use plan first recommended to government that the Empire Valley Ranch should be purchased?

[W. Hartley in the chair.]

Hon. D. Zirnhelt: As I recollect, it was in October of 1994 that the Cariboo land use plan was released. There was a 90-day implementation period, in which they went through how to implement the land use plan.

R. Neufeld: The province had an opportunity to purchase that ranch in 1996. Can the minister tell me why that wasn't accomplished? Or would you like to defer that to the Minister of Environment? He nods that he would like to refer that also.

Other than a couple of questions that I have about the valuation of the wood in Fort St. John . . . . Approximately 146,000 cubic metres of wood is going to be logged by Vesco Contracting. In the background information that came from the Ministry of Environment, Lands and Parks, there's discussion around the value of the timber on both the Empire Valley

[ Page 8737 ]

Ranch and in Fort St. John. It's valued at approximately $3.5 million. If you work that backwards -- the 146,000 cubic metres -- that means they valued the timber in Fort St. John at $25 a cubic metre. I've been given information from the district manager of the Fort St. John office of the Ministry of Forests that that timber in those areas was valued at between $50 and $70 per cubic metre. Some of it was valued a little bit more; some a bit less -- so, on average, $60 a cubic metre.

[4:00]

Can you tell me how we arrived at a value of only $25 a cubic metre? Would it have made a difference for woodlot owners who owned those woodlots prior to having that land transferred fee simple to Vesco if they'd only had to pay $25 a cubic metre to the province for that wood? Would the minister agree that they probably could have made a go of those woodlots?

Hon. D. Zirnhelt: For the actual value of the timber in the trade, you can ask the Minister of Environment. They did the appraisal and used the discounted cash value approach. So we're comparing apples and oranges. Yes, if woodlot people had that stumpage rate or that value, they would have been able to make money. But the fact is that the land they log on is Crown land that became private land. It was exchanging private land for Crown land that became private land, not private land for Crown land.

So you compare on the basis of what the economic value of the private land was, so it had to be an equivalent exchange. To have a common basis of comparison, the objective was to treat the timber values on both lands equally, recognizing that there are different timber types and so on. The Minister of Environment can handle all those questions in her estimates.

R. Neufeld: It's an interesting comment that the Minister of Forests just made. I think it's more trying to justify the end by the means of how you come up with $25 a cubic metre, because had that land stayed in Crown hands . . . . It didn't have to transfer from the Crown to fee simple. The government of the day transferred it for their own purposes. You have forgone a huge dollar value. If the Ministry of Forests office in Fort St.

John believes that that timber was worth between $50 and $60 per cubic metre in stumpage to the province of British Columbia, just because you change it to fee simple land doesn't mean that it's all of a sudden worth only $25. That just doesn't ring true in anybody's language.

I have one last question, I guess. It relates to a public meeting that I called in Fort St. John. Actually, I was the only one that wanted to get this kind of information out to the public so that they could take part, hopefully, in the discussion surrounding this land trade deal to maybe try and get some concerns dealt with. In fact, I invited the Minister of Forests, the Minister of Environment and a few other people from the ministry to the meeting. Obviously those people elected not to show up.

The same district manager in the Fort St. John forest district, who you stated earlier would be making agreements with the contractor as to how the environment was going to be looked after in the logging of the land in Fort St. John, sent out an e-mail to his staff. I'm not going to read the whole e-mail because I don't think you want to hear the whole e-mail, but I am going to read part of it. It seems to kind of go along with what the government of the day has been doing in the last while.

I want to read it: "I do not believe that ministry staff, other than those above, should attend the meeting." This is the meeting in Fort St. John. "If you were to attend, it would be perceived as support for the protest against the Crown. And as an employee of the Crown, this may be a career-limiting decision." This is a directive from the ministry office not to attend a public meeting in Fort St. John: "Also, I expect there will be media coverage. Since you may be recognized as a ministry employee, the media may want to interview you for your personal views. I do not want you to get caught in this trap.

Therefore I ask that you do not attend even on your own time. I will be there, as I am one of the six noted above, and will give you an update after the meeting."

Is that consistent direction from the ministry's office to regional and district offices when people are actually trying to get some information that government seems to be hiding or information on something that's going on in their area. Is this a standard procedure that would take place? Maybe the minister would like to comment on that; it is actually within his purview.

Hon. D. Zirnhelt: There certainly was no directive. I probably found out about this after the member. I was concerned when I heard about it. I think the district manager perhaps erred in suggesting that people not attend on their own time. But as far as representing the Ministry of Forests, the district manager went, and I think the district manager was trying to keep the politics of the issue separate from what they were doing as administrators of a Crown resource.

The district manager did what he thought was correct at the time, and perhaps it could have been handled better. But there was no instruction from my office to . . . . I don't give out directives like that.

R. Neufeld: The silviculture obligations for the harvested land in Peace River North . . . . I understand, and again I'm going by written documents: "Vesco and the province will contribute to a reforestation fund to cover site preparation and replanting. Vesco will pay $200,000, and the province will contribute $100,000." Is it anticipated that $300,000 is going to be sufficient to replant 700,000 hectares of land? Where is Vesco's portion of this money? Is it in trust, at the present time, with the Ministry of Forests -- with their $100,000? Just where is that at?

Hon. D. Zirnhelt: I'm advised that $300,000 will be sufficient. As to the question of where Vesco's money is, my understanding is that it is in trust. I couldn't tell you exactly where the account is, but it's in a trust account.

R. Neufeld: Well, I can hardly resist: maybe the minister can provide me with the account number and the bank where this $200,000 is in trust, or at least provide to me where it is in trust, so that I can feel comfortable that it is actually there already. If he could provide me with that information, I'd appreciate it.

Hon. D. Zirnhelt: Unless there's some legal reason why I can't. But if I have to undertake to provide you an assurance, I'll undertake to do that and give you as many details as I can.

G. Abbott: Before we turn to the jobs and timber accord, the deputy critic for Forests has a couple of questions around a FRBC issue which could be usefully dealt with while this staff is here.

R. Coleman: Given the most recent discussion in the House this year, I think we're probably going to have the longest estimates in the Ministry of Environment's history, because there are a number of issues relative to that that are affecting jobs.

[ Page 8738 ]

I just had a series of questions come to me from a number of constituents, and I want to ask them of FRBC while we have the officials here today. They are with regard to the "Beyond Boards" directory that was published by Forest Renewal B.C. It's about B.C. value-added wood products. It's a very glossy catalogue that was published. The first question I have for FRBC is: how much did it cost, and where was it printed?

Hon. D. Zirnhelt: I don't have that detailed information here. I'd be happy to get it and to provide it to the member.

R. Coleman: If you don't have the price or who printed it . . . . There's no indication as to the printer, so obviously it wasn't done by the Queen's Printer. I'd also like to know how many copies were printed of this particular publication. Could the minister tell me what the distribution was of this particular catalogue -- to what agencies? Where did it go?

Hon. D. Zirnhelt: It's FRBC's publication. It was distributed throughout the province. It's a directory of value-added services and products.

R. Coleman: The information I was asking the minister for is: how many copies were distributed? Obviously I'd like to know whether the contract for printing was put out to tender. How many bidders were there for the tendered contract, if it was put out to tender? If not, how did they make a decision as to who would get the printing contract for the particular catalogue? The next question I would have is: given that some of the companies, for instance, Scott Paper, a pretty large, multinational corporation . . . . Did any of the companies contribute to the cost of this particular publication?

Hon. D. Zirnhelt: I'll have to get that information for you.

J. Wilson: Last week I requested a little bit of information from the minister with regard to comparative logging costs in the Empire Valley-Churn Creek area, and that information wasn't put forward today. I would ask the minister what the logging cost would be on a piece of Crown land in the vicinity of the Empire Valley Ranch, including the hauling costs out of there factored in, where it's Crown land.

Hon. D. Zirnhelt: We did provide the information to your critic, and the information was $34 a cubic metre for the Empire Valley logging costs. The average logging cost in northeast British Columbia will range from $35 to in excess of $60 a metre, and the averages will be in the range of $45 a cubic metre. The parcels in the land exchange will have a lower-than-average logging cost, as most parcels are closer to the mill and require little or no access road construction.

J. Wilson: On this logging cost: is the cost of the trucking factored into this?

Hon. D. Zirnhelt: We believe it is. We can double-check that, but we believe it's in there. The answers were prepared from the questions in Hansard , so I'll just double-check that.

G. Abbott: If we could turn to the jobs and timber accord now, and perhaps most usefully, if the minister has a copy of the accord with him, I'll deal with the questions on a page-by-page basis, and we might most efficiently move through it that way. Let me begin, though, by following up on some of the initial questions we had with respect to the contract for the jobs accord advocate. The minister noted that the term of the contract is five years, so presumably we have a contract with Mr. Wouters that runs from approximately June 1, 1998, through to June 1, 2003. Is that correct?

[4:15]

Hon. D. Zirnhelt: Yes, that's correct. I don't have the actual date of the contract here, but it does run approximately two years beyond the life of the accord.

G. Abbott: The minister noted in my initial questions that there is an office of the advocate, as well, that would operate under the direction of the advocate, and the cost of that, as I recall, was somewhere around $800,000 a year. Will the office run to roughly June 1, 2003, as well?

Hon. D. Zirnhelt: We don't expect the initiatives to end when the accord ends. As you know, there's a provision to review elements of the accord, particularly the fibre transfer portion of it . . . .

Interjections.

The Chair: Members, it has been pointed out that it's hard to hear in the room. Perhaps members who are having conversations could take them out of the room.

Hon. D. Zirnhelt: I gave you an example that two years into the accord, we're to review the wood fibre transfer program, which is essentially an undertaking by industry to provide 16 to 18 percent of the fibre. But as we note, the accord is of four years' duration, and we expect a lot of the initiatives to carry on, including evaluating how the accord is going. We're hopeful that there will be ongoing initiatives under elements of the accord that he can advocate. But by way of explanation, industry is fully part of this.

They felt it was important to get the right person; they felt it was important to have some continuity there and to have it of sufficient length that we can do the job that he's undertaken to do.

G. Abbott: The minister anticipated my next question. Despite the term of the accord being to December 31, 2001, in fact the role of the jobs accord advocate would continue on after that. Is it the expectation of the government that the jobs and timber accord is going to be renewed or that some successor accord is going to be put in place?

Hon. D. Zirnhelt: I think it's really premature to speculate on that. The market conditions, the economic conditions, are different than when we brought in the accord. I say it would just be speculation. I think we're satisfied that there will be the continuation of some aspects of the accord and that there will be a role for the advocate to play in the future. That is simply the reason.

G. Abbott: If the minister could go to page 3 of the accord, my first question is on that. This is under the general provisions of the accord. "A provincial target of 37,800 new jobs will be the goal for the term of this accord, made up of 20,400 direct and 17,400 indirect jobs."

The first question I have is: if the goal of 37,800 new jobs is only a target or just a rough target, why is it that the government puts such precision on the number? If it is a rough target, why not 40,000? I guess it actually has been

[ Page 8739 ]

40,000 or 41,000 at times in throne speeches and so on. But why the precise numbers if we're talking about rough targets rather than precise targets?

Hon. D. Zirnhelt: The numbers could have been rounded, but we looked at each of the buckets of jobs, if you will, and in discussion with industry came to an agreement about what might be reasonably expected given the conditions that we were trying to bring to bear on job creation in the sector. So they added up to this figure of 20,400, and the indirect is, I believe, simply a factor of what could be reasonably expected to be generated from that. To give it as much precision as possible, we picked those numbers. Then we're managing by the buckets of jobs that are later enumerated in the accord.

G. Abbott: In almost every instance throughout the accord a 1-to-1 ratio is extended for indirect jobs in relation to direct jobs. There's just the one case, and that's the alternate work arrangements, where there's no claim of 3,000 indirect jobs created, although 3,000 are expected to be directly created. Was there any particular reason why the government chose the 1-to-1 ratio? Is that a standard multiplier in British Columbia?

Hon. D. Zirnhelt: A 1-to-1 ratio wasn't used, because some of them -- for example, new work arrangements -- don't have a multiplier. But we're going to continue to refine the jobs. These were the closest estimates we could come up with at the time, and we didn't want to overestimate the multiplier. We could have used different multipliers, but we wanted to be conservative. We're focusing on the direct jobs. That's the key. In the discussions, industry was keen to have the extra 17,000 jobs added to the list, because they felt that those genuinely would be created, were we successful in creating the original 22,400.

G. Abbott: The only case in which the 1-to-1 ratio was not used is in the alternate work arrangements, where 3,000 would be created directly through alternate work arrangements but there's no anticipation that additional indirect jobs would be spun off from that. That's probably appropriate in that case.

Is it the view of the ministry that, given the 1-to-1 ratio and given the deficit position we're in, in relation to jobs . . . . The minister can correct me on this. Different figures have been used -- 12,000 in deficit, 12,000 lost, 13,000 lost -- at different times by the Premier or the minister. If we are down that many direct jobs, can we also assume a 1-to-1 ratio as we have with the creation of jobs, and that we are down that many indirect jobs as well?

Hon. D. Zirnhelt: Just to clarify: if you take the 22,400 jobs, and you take off the work arrangements and the Fisheries Renewal jobs, which we're not going to count in any multiplier for, then we're down to 17,400, on which it is a 1-to-1. We intend to count the direct jobs. We talk about SEPH -- the database on which we agree -- and we're going to measure against the 20,400 plus the 2,000 Fisheries Renewal jobs. That's what we'll be looking for. The direct forestry jobs is the 20,400, and that's what we're going to measure against.

We're not going to be measuring the multiplier jobs, although we expect that they're there. Conversely, if we lose some jobs at some point in the industry, yes, there will be some multiplier effect. I can't speak to the actual multiplier, except to say that we're going to count the jobs as measured by the survey of employment, payroll and hours.

G. Abbott: Could the minister confirm that the government is going to count not only jobs created but also jobs lost, as in the job curtailment reports that we have discussed previously? Both sides of the equation are going to be measured in a systematic way by the ministry or some group authorized by the ministry -- is that correct? Are both sides of the equation going to be measured?

Hon. D. Zirnhelt: The survey data that we're talking about, which is the most scientifically valid, is going to pick up the pluses and minuses. We're not going to blend databases here. But if there's a job lost, it will be picked up by the SEPH data. In the end it will be SEPH that counts how many jobs there are in the industry at any given time.

G. Abbott: The fact is that this is a highly cyclical industry in British Columbia, and it has been for the last 150 years. I thought, even back in 1996, that it would give one pause prior to setting out ambitious claims about how many new jobs were going to be created. Notwithstanding that advice, which was tendered from numerous sources, the government adopted and then advertised very widely these very ambitious job targets associated with December 31, 2001. That's when the accord ends. I guess it is probably June something-or-other of 2001 when the four years will be up.

The government set out these very ambitious targets. Do they stand? The minister said at one point that they were being reviewed or something to that effect. Can the minister advise, in light of the downturn -- the significant layoffs and job losses that have been experienced in the past months and years in the B.C. forest industry -- if that provincial target of 20,400 direct jobs is going to be revised downward? If so, when? If there is a current figure as to where it should appropriately be, what is that figure?

Hon. D. Zirnhelt: I think that if you go back to the public record, you'll see that I have said consistently that we are going to leave those targets there. They are targets. We said that it took many things to create those jobs. It took the cooperation of industry and government; it was a joint agreement. At this point we see no need to do that. We are going through curtailments of jobs that are related to market and economic conditions. It's our hope that it's short and cyclical. But we go back to the fact that those targets represent the vision.

They represent an increased number of jobs per cubic metre, and all of the pieces of the accord are going to have to be played out before we'll see those jobs.

We won't revise those numbers now. I didn't say they are under review, except to say that we're constantly reviewing progress on the jobs and timber accord. I've said time and time again that when the accord was signed, nobody expected a major downturn. I think that one industry spokesperson who was there in Prince George when it was announced did say that it would be very difficult to achieve those if the industry went into a serious downturn. I think everybody has recognized that. We've gone into it with our eyes wide open.

The public of British Columbia understand how difficult it is, because they've seen in previous down cycles the shedding of tens of thousands of jobs on a permanent basis through restructuring. We've said we'll use the policy levers of government, the incentives in the accord, to work toward these goals, and we have to take the jobs package by package.

[4:30]

G. Abbott: I think people do understand the cyclical nature of the B.C. forest industry. I think they also understand

[ Page 8740 ]

very clearly -- and this is a critical point -- how preposterous a notion it is that you can claim at any given time to be creating so many new jobs based on this cyclical nature in British Columbia. We can stand in this House and wish all kinds of things. We can wish the creation of 200,000 new jobs, but there is clearly no justification for that. I know what the root of this thing is, because it appears in the throne speech of 1996. This whole job creation thing is based on the notion that what happens in the industry in Washington and Oregon can be duplicated here.

Indeed, there are questions about whether in fact we haven't duplicated it here. The whole notion that we weren't getting the per-cubic-metre return that Washington and Oregon were may be questionable as well.

There's a lot of pretentious thinking, I think, that goes along with saying: "We're going to create an accord; therefore the jobs are going to be created." I think that's nonsense. Jobs are created as a product of opportunity; they're created as a product of people making an investment based on the prospect of having some return. There are many things that enter into whether those new jobs are created, whether that new opportunity or investment is followed through on. Certainly the marketplace . . . . There needs to be a market where a product can be sold at a price that will provide a return on the investment made.

The notion that people are going to invest or the notion that people are going to follow up opportunities, based on an accord that's signed, is nonsense, and people understand that it's absolute nonsense. The idea that we set out these ambitious job numbers, then spend one hell of a pile of money saying that these numbers are true and that we're going to do it is, I think, dream-making of the most offensive kind.

I know that the minister wants to take a short break, and I'm happy to do that as well. Perhaps I can carry on after that, hon. Chair.

The committee recessed from 4:33 p.m. to 4:38 p.m.

[W. Hartley in the chair.]

G. Abbott: I'll just pick up the theme again from where we left off. I think that people do understand the cyclical nature of the forest industry in British Columbia. I think they also understand the politics of illusion that is associated with this accord.

The minister said: "Well, regardless of what's going on in terms of job losses or job curtailment, we're not going to revise the targets, because they're targets, and that's what we want to see."

Well, that's fine, but the fact of the matter is that no one in the forest industry in British Columbia is going to create one new job because the accord says they have to create one new job. In the forest industry in British Columbia -- whether it's a value-added producer, a major licensee or a small business logger -- no one is going to create a new job in British Columbia unless they see an opportunity there, unless they see a market there and unless they see a cost structure which will allow them to invest and see a return on that investment at the end of the day.

Without that, they're not going to invest, no matter how many accords there are, no matter how much encouragement there may be in an accord, in a moral way, to create jobs.

I guess this debate about what induces people to create jobs has been around for a long time. The fact of the matter is that they don't create them to be good citizens. People create jobs because they see an opportunity and because they see a possibility of return on an investment. Without that, it ain't gonna happen; without that, the job accord means nothing.

The fact of the matter is that the biggest discouragement to investing in British Columbia has been a set of tax and regulatory policies that have been utterly discouraging to the creation of new jobs in the province. It's the issue of the very expensive Forest Practices Code; it's the issue of very onerous stumpage rates; it's the issue of excessive taxation. All of these things, in combination with a declining market in Japan, have sent our forest industry into a tremendous downspin.

Regardless of any of the pretty words in the accord, it's those things -- the fundamentals -- that have to be corrected if we want to see jobs created in British Columbia. Without the correction of those fundamentals, we'll continue to see additional job losses in the province. I think that's a fact, and no amount of social forestry, where we create short-term jobs to meet job creation numbers, is going to change things.

What we desperately need to do in British Columbia -- and I hope this is clear, after our discussion around New Forest Opportunities -- is make our industry more competitive in world markets once again. We absolutely have to do that, and we absolutely have to address the fundamentals on the cost side if we're going to make our industry competitive again. I'm afraid that one of the things that happens with New Forest Opportunities, the jobs accord advocate and all these things is that they pile additional costs onto the industry and discourages them from making the investments and creating the new jobs.

We pile more costs onto the industry, claiming that we're creating new jobs, when in fact we're doing exactly the opposite.

That's my overriding concern here -- that this accord may set up the very noble illusion of creating more jobs. If it's doing the opposite, if the cost of the thing is actually making it less likely that we're going to create jobs in the province, then surely that has to be pointed out. Before we move along, I'd like to hear the minister's response to that.

Hon. D. Zirnhelt: I think that if the member wanted to refer to the

preamble in the accord, it says: "Whereas industry and government agree that the creation of new, economically viable jobs and the sustaining and enhancement of the existing base of jobs are key priorities for the publicly owned forests . . . . " We say that there. Under general principles we say: " . . . any plans, strategies, or initiatives agreed to under this accord must be workable, practical and feasible for industry and government." It's all there.

There was a recognition that there had to be adequate return on investment. It says that we believe it has to be an internationally competitive industry. I think everything is there, in terms of recognizing it. We have addressed the cost structure issues. Industry has to deal with some of their productivity issues, but government dealt with the cost of the code. You can't have it both ways. Industry said, "Don't relax the standards," so we have to find the most cost-effective way of doing that. I submit that we have moved significantly in that direction, which will change the cost structure of industry.

But we can't remove the floor of environmental and forest stewardship protection. We can't do that. You can't say that you have to drive that floor down. What is implied, in statements from your benches about gutting the code and too much red tape, is words, until you look at what is actually behind those words. Really, it means: change the standards; don't do something you were doing before. I submit that we have done and will do more, if someone can demonstrate that

[ Page 8741 ]

we can remove what is just red tape without changing environmental and forest stewardship standards. We can do that.

We've reduced stumpage. A 30 percent reduction has happened since last fall. We've made it more market-sensitive. Those are all things we've done, in addition to the accord. The accord assumes that fibre will be available, so if you look at the accord, behind every initiative is the providing of more fibre, whether it's for the small business program or whether it's dealing with the undercut, or whatever. Industry agrees that if we do the things in the accord, they will then be poised to create the jobs.

It isn't government creating all these jobs, although it is government funding through Forest Renewal that is creating the land-based jobs. We want longer-term, more year-round jobs. We have discussed that, I think, in the discussions around NFO.

[4:45]

The other issues around, for example, initiatives by major licence holders -- 2,000 jobs there . . . . That isn't going to happen, given market conditions. It will require a turnaround in the market; we don't expect that to happen unless there is a turnaround in the market. Similarly, if they aren't able to negotiate alternate work arrangements with their unions, we don't expect that it could happen. It has to happen through . . . . But it is a target. It is something that we think should be looked at -- the reduction of overtime, for example.

This is an incentive-based accord. There are incentives in here about getting access to fibre that they wouldn't ordinarily have access to. Given the access to the fibre, then the jobs can flow and the investments can happen. We don't disagree that there has to be a return on investment, and we have addressed the cost structure issues.

G. Abbott: The first thing I should note, in response to the minister's comments, is that no one on the opposition benches has ever used the term "gutting the accord." That was a phrase that a reporter may have attributed to us, but the phrase has never been used. Believe me, I was there. We have never said "gutting the accord." What we have repeatedly argued for is a results-based code, and in fact, I think the minister has over time -- in response to the arguments we've made -- adopted some of that view.

Certainly if we had said two years ago that we needed to move away from the process-oriented code that we currently have to a more results-based code, he would have said: "Oh, you're going to gut the accord."

In fact, the minister himself and the Minister of Environment have recently announced changes which theoretically reduced the cost of the code from something like $750 million a year to $400 million a year, without -- supposedly -- compromising any of the environmental objectives contained in the code. I guess we'll be onto this in a more detailed fashion later on, anyway. But the important point here is that both ministers argue that we can save some $350 million a year in code costs without compromising environmental goals.

We're not satisfied that we have achieved anything near what we can achieve from a results-based code, yet we feel that a good deal more can be done. We feel that there is still too much regulation, too much duplication and too much overlap in terms of the way a lot of these issues are dealt with, and more needs to be done. Again, if we don't move on that -- and I hope that in fact the minister is going to move on this . . . . Without moving on that, we are still going to have cost-side problems to deal with. We will be getting back to code issues, and I know this debate will continue there.

The point, again, that I want to make is . . . . And I don't disagree with some of the stuff the minister says. He says: "Well, we realize that markets have to turn around. We realize that we have to address the cost side. We realize this . . . " and so on. But the point I make -- and it has to be made, because it's a necessary counterbalance to what the Premier has been saying over the past couple of years about this -- is the following.

If you don't believe the numbers, if it's only a hypothetical target and not a reality, then don't make it the centrepiece of your throne speech, and don't sign a big-deal accord around this thing based on those numbers. And the advertising -- millions of dollars in advertising. It's absolutely wrong to set up the illusion that we're going to do it, that it can be done and that it will be done.

I can, if the minister wishes, bring in the 1996 throne speech in which the Premier, through the Lieutenant-Governor, stated very clearly that we're going to create 21,000 new jobs by 2001 in British Columbia. He didn't say: "We would like, under certain circumstances, to create 21,000 new jobs." He didn't say: "Well, maybe we will," or "We might," or "We may." He said: "We will create the jobs." We find the words "will create" on numerous occasions, and I'll point them out to the minister as we go. He didn't say, "We might." He said: "We will." And that's where, I'm afraid, we have to hold this government accountable for the illusion that it created.

No one was shy and bashful about proclaiming the success that the government was going to enjoy in creating new jobs. There was a campaign about a job behind every tree -- blah, blah, blah. It went on and on, at enormous expense, to create the illusion that this government was creating jobs, when in fact their policies were contributing to the destruction of jobs. So I'm not retreating from the point at all, and perhaps we can continue this general discussion as well. I have some additional, more specific questions for the minister.

On page 4, second paragraph down, it says: "Consultation will be undertaken between government and industry for a B.C. forest job creation tax credit to hire youth, with additional incentives to employ women and aboriginals." Can the minister tell me what the current status is with respect to those consultations and the job creation tax credit?

Hon. D. Zirnhelt: Yes. There has been some preliminary analysis done, and the work will be turned over to the advocate.

G. Abbott: On page 4, as well, it talks about job maintenance and creation. It says: "Job creation will come from increasing major licensee harvest volumes towards AAC by three million cubic metres by 1999-2000. This will create 3,900 direct jobs and 3,900 indirect jobs." It seems clear enough there that they will be created. Is the minister telling me now that we should really be saying this may create 3,900 new jobs?

Hon. D. Zirnhelt: The numbers come as a ratio. It's a ratio of 1 to 3. The undertaking by government was to make the fibre available through arrangements with the companies -- they do certain things and we do certain things. We have increased the standing timber inventory which provides for this to happen. The intention was that we make the AAC available by the year 1999-2000. Having done that, industry agreed that the jobs would be created. That's the intent: if you cut more wood, you should create more jobs. The intent is to reduce the gap between the AAC and the actual wood harvested.

G. Abbott: Will the minister acknowledge that in fact the gap between the AAC and the cut volume actually increased

[ Page 8742 ]

in 1997 and that we cut considerably less than we anticipated or than what was made available? It would appear that in 1998 the gap will be even wider. Will the minister acknowledge that?

Hon. D. Zirnhelt: Yes, we anticipate 1998 to be a difficult year, so the numbers will be down. That's why the accord is of some years in duration. We expect that there will be more inventory, provided that companies make application for cut permits. If companies don't apply and don't do the development planning, the wood won't be available. So it should say . . . . We've implemented this by having agreements with any industry that wants to do it. They said: "Give us the wood. Make the wood available, and we will be able to create the jobs." But given the market conditions, we don't expect that those jobs will be created.

G. Abbott: The minister anticipates that they won't be created in 1998. Is it anticipated that they will be created by 1999-2000?

Hon. D. Zirnhelt: I've said time and time again -- I've said it publicly; I've said it here in the House -- that there has to be a turnaround in the market to create the jobs. We didn't foresee the particular market we're in -- the falloff in Asia. Nobody foresaw that when the accord was signed, so it will be very difficult to achieve these objectives in the time frame. Nevertheless, we will attempt to do everything we said we would do about making the fibre available. The market has to take up the fibre, but we will do everything in the accord to make the fibre available.

Any arrangements in here that we've undertaken to do will be done, so that when the market turns around, industry will be poised to create the jobs.

G. Abbott: Clearly there won't be the creation of jobs until we do see a turnaround there and significant changes on the cost side. That's exactly the point I've been trying to make. Those jobs may be created. "May create" would certainly cover off the possibilities here,

whereas "will create" is not informative of the situation at all. "Will" suggests that something is going to happen,

whereas we were saying that this may happen under certain circumstances.

Further, I think that when the Premier adjourned the House for two days in the last session to fly up to Prince George to unveil this accord, it was pretty clear that we had big problems in the Japanese market. Yet, notwithstanding that, we chose to, with great hoopla, unveil this accord and, with even greater hoopla, to spend a lot of money saying that we were going to do that. That is, I'm afraid, the fundamental flaw here: this is a product of the politics of illusion, not of the politics of reality.

The second bullet under "Job Maintenance and Creation" says: " . . . achieving standing timber inventory (STI) targets sought by each licensee to reach two years of STI by March 1999 and maintaining those levels." Could the minister advise -- by region if necessary, but generally -- what the average across the province currently is with respect to STI? I gather it remains something considerably less than two years. STI, of course . . . . I'll explain it to anyone who is confused by the expression. This is the time in hand of the cutting permits of licensees.

I understand that the average across the province is considerably less than two years at this point, that there has been considerable variation regionally in the level of success achieved. Can the minister advise me generally what the situation is and in what areas the STI rate of achievement has been less?

Hon. D. Zirnhelt: In parts of the interior we're approaching two years. Across the province it's just over a year. When the accord was announced, it was approximately nine months, so we've made improvement there. We have offered, to any company that wishes it, to enter into an agreement on how to achieve the numbers by March of '99. In some cases industry is not prepared to invest in the development planning, but we can't offer that without work that they do. This is a two-way street; they have to do certain things. We're prepared to enter into performance agreements. The approval times have been turned around.

This is one of those areas where we will achieve it. Industry wanted the two years. We've offered it; we've offered a means to get it. It's in the hands of industry.

G. Abbott: So the minister is committing here today that provided industry is prepared to put in the cutting permit applications necessary, his ministry, by March of '99, is going to commit to having those two years of cutting permits in hand for industry.

[5:00]

Hon. D. Zirnhelt: That's where the performance agreements come in. Industry has to put . . . . They can't ignore the code; they can't ignore regional plans. They have to apply in accordance with the stewardship standards that are out there.

G. Abbott: Two bullets down . . . . I'll ask the minister to explain this one. This is an interesting turn of phrase. Anyway, the sentence reads, "Job creation will come from," and then it reads: " . . . monitor forest management policy reflected in protected-areas strategy, land use plans, first nations deferrals, etc. to ensure that the AAC can be spatially demonstrated." Can the minister translate that into farmerese for me, please?

Hon. D. Zirnhelt: The explanation of "spatially demonstrated . . . . " Spatial data is a technical term that refers to the geographic location of a forest stand within a geographic information system database at a specific time. It just says that they have to be prepared to show where it is on the landscape; they have to have a map that shows where it is.

It's important to demonstrate that the allowable annual cut or where harvesting will take place or has taken place recognizes the conflicts with other resource values or code requirements, such as visual green-up or a block harvested prior to harvesting adjacent blocks. So they have to look at green-up and they have to look at the overall spatial distribution -- where on the landscape the cut is distributed. The intent of this particular issue is to take into account the various planning initiatives that we have -- first nations concerns, for example -- and make sure that there are no holdups.

We've got to make sure that the plans . . . . The industry has to undertake to look at all the things in the planning environment when they make the submission of their plans.

You asked a question about standing timber inventory. It's at 1.7 years in the Cariboo; 1.41 years in Kamloops; 1.31 years in Nelson; 0.81 years in Prince George; 0.99 years in Prince Rupert; and in Vancouver, it's 0.82 years. The average is 1.04 years.

G. Abbott: Now that we've returned to the first proposition about standing timber inventory, can the minister give me some indication of why, for example, the amount of standing timber inventory is more than double in the Cariboo what it is in Prince George and in the lower mainland?

Hon. D. Zirnhelt: To illustrate a bit, in the Cariboo we have a land use plan. The economics of the interior industry

[ Page 8743 ]

were such that they certainly were able -- over the last little while, anyway -- to invest in the planning. In Prince George there are high operating costs. It's good wood, as a rule. It is high stumpage; there are some economics working there. In Vancouver, we're down at 0.82. One of the reasons it's so low is that there's a lot of controversy. A lot of the area has been cut over, and it's much more difficult to balance the various uses of the forest. So we're not where we need to be. That will continue to be a difficult challenge there. But I'm optimistic that if industry wants to do the planning, we can deliver,