1976 Legislative Session: 1st Session, 31st Parliament

HANSARD

The following electronic version is for informational purposes only.

The printed version remains the official version.

Official Report of

DEBATES OF THE LEGISLATIVE ASSEMBLY

(Hansard)

FRIDAY, MAY 28, 1976

Morning Sitting

[ Page

2133 ]

CONTENTS

Routine proceedings

Extra-provincial Custody Orders Enforcement Act (Bill 18).

Hon. Mr. Gardom. Introduction and first reading — 2133

Home Purchase Assistance Act (Bill 49) Hon. Mr. Curtis.

Introduction and first reading — 2133

Auditor General Act (Bill 45) Second reading.

Hon. Mr. McClelland — 2133

Mrs. Dailly — 2135

Mrs. Jordan — 2136

Hon. Mr. Mair — 2140

Mr. Kerster — 2142

Mr. Kempf — 2143

Mr. Rogers — 2144

Mr. Haddad — 2144

Hon. Mr. Nielsen — 2146

Mr. Mussallem — 2147

Mr.Kahl — 2149

Mr. Skelly — 2151

Mrs. Wallace — 2157

Hon. Mr. Wolfe — 2157

Division on second reading — 2159

FRIDAY, MAY 28, 1976

The House met at 10 a.m.

DEPUTY CLERK: In accordance with the provisions of standing order 12,

it is my duty to announce that in the unavoidable absence of Mr. Speaker the

Deputy Speaker will take the chair.

[Mr. Schroeder in the chair.]

Prayers.

HON. W.R. BENNETT (Premier): Mr. Speaker, I draw attention to

the House that this is the last day in the gallery of one of the most

respected reporters who has served this House, and that is Linda

Hughes. I'm sure the gallery and all members of this House will be

sorry to see her leaving.

Linda came to the gallery about two and a half years ago, just about the time I showed up in the Legislature, and I'd say....

Interjection.

HON. MR. BENNETT: We came together. But her most notable

distinction is that she was the only reporter that travelled with the

former Premier on his trip to China. So she's been in good company

coming and during. Where she's going, I understand, she'll continue to

be in good company because she gets to leave one Hume here in the

gallery and, when she gets to the Edmonton Journal she'll

be working with another Hume, Jim Hume's son, Steve Hume, who's the

city editor. So I ask the House to make note of the fact that Linda is

leaving and offer our best wishes for her continued success.

MR. D.G. COCKE (New Westminster): Mr. Speaker, we share the Premier's

position with respect to this question. I happened to be with Linda on that

trip to China and we very much appreciated her fastidiousness and her ability

to see many of the things that some of our older eyes didn't see, and

I've appreciated the relationship that we've had with her over the last

number of years. We're going to miss Linda in this House. The only thing

I hope is that the activities in her tenure here haven't made a bit of a

cynic of her. [Laughter.] If that hasn't occurred, Mr. Speaker, it's

all to the good. We wish her luck in Edmonton, my old stamping grounds. I certainly

know she's going to find quite a different winter from what she's used

to. The very best of luck, Linda, from the opposition.

MR. G.F. GIBSON (North Vancouver–Capilano): Mr. Speaker, it's mostly

all been said, but to a journalist of accuracy and perception and insight and

intelligence, and a real pleasure to know, I would wish her all the very best

in Edmonton.

MR. G.S. WALLACE (Oak Bay): Mr. Speaker, I would like to add

my personal best wishes to Linda Hughes. I can only say that if it's

been necessary for her to leave this fine province, I can't think of a

better Tory province to go to. [Laughter.]

DEPUTY SPEAKER: Before I recognize the Attorney-General, in

light of what is happening south of the border, I just want it to be

perfectly clear that I have not been anywhere, with Linda. [Laughter.]

HON. G.B. GARDOM (Attorney-General): Mutatis mutandis, Mr. Speaker. [Laughter.]

Introduction of bills.

EXTRA-PROVINCIAL CUSTODY

ORDERS ENFORCEMENT ACT

On a motion by Hon. Mr. Gardom, Bill 18, Extra-Provincial Custody

Orders Enforcement Act, 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.

HOME PURCHASE ASSISTANCE ACT

Hon. Mr. Curtis presents a message from His Honour the Lieutenant-Governor:

a bill intituled Home Purchase Assistance Act.

Bill 49 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.

Orders of the day.

HON. MRS. McCARTHY: Second reading of Bill 45, Mr. Speaker.

AUDITOR GENERAL ACT

(continued)

HON. R.H. McCLELLAND (Minister of Health): I'd like to say a

few words today in support of this bill, the Auditor General Act. It's

been mentioned many times that it will be the best auditor-general Act

in Canada, containing many new innovations which will safeguard the

taxpayers of this province against the excesses of any government.

Mr. Speaker, I found the actions of the opposition members in this

House last evening to be a little disappointing, and particularly the

comments made in debate in this bill by the second member for Victoria

(Mr. Barber) who seems to feel that he and he alone

[ Page 2134 ]

decides when debate on a bill

should be held in this House. The reason, Mr. Speaker, that bills are

brought into this House is so that the background of them can be

explained, so the need for them can be explained, and it's the past

three and a half years or so of the previous government that made this

bill so necessary at this time. That's the reason, Mr. Speaker, that

this bill must be debated.

For that member to stand in this House and accuse any other members

of this Hous e of, I think he said, "issuing venom and poison in debate," is the most unctuous kind of nonsense that I've ever heard spouted

in this House from a member who always, in every debate he's been

involved in so far, has delivered the kind of poison that no other

member in this House has, only it's been wrapped in a kind of a cloak

of piety — phony piety, at that.

DEPUTY SPEAKER: I must remind the minister of the standing

order which prohibits the use of offensive language as directed toward

any individual. Although no offence has been taken, I would just

suggest, in view of keeping good order in the House, that the minister

please be a little more careful in the selection of his words.

HON. MR. McCLELLAND: Thank you, Mr. Speaker, I shall — it's

difficult, though, at times. The provocation is there and I will

attempt to restrain myself from reacting to it.

Mr. Speaker, it has to be the height of hypocrisy for any member on

that side of the House to complain that because we are outlining some

of the needs for this bill, needs that arose out of three years of

financial ineptitude particularly by the previous government, those

members.... Of course they don't like it. But to say that we're

bringing up old issues when that second member for Victoria (Mr.

Barber) consistently refers to things like the Sommers case, drags

through the mud again the name of a person who has paid for any sins

that he might have suffered, paid in the normal way through the

courts...you have no right to continue to drag a person's name through

the mud in that way.

MR. L. NICOLSON (Nelson-Creston): What about the rest of the gang?

HON. MR. McCLELLAND: Mr. Speaker, certainly this bill will

prevent many things happening again which happened in the past three

years, we hope. I just want to say that the kind of statements made in

the House by the second member for Victoria are the worst kind of

political mischief, in my opinion. I hope that we don't have to suffer

them too long.

This bill should be able to make the people of this province, once

the auditor-general is in place, at least aware of any excesses

government might become involved in. I'm sure the auditor-general will

not only deal with financial implications, but also the peccadillos of

government of all kinds.

Again, because the auditor-general will be maintaining a close watch

on governments of the future, we hope we won't see things like ICBC

happening again — a dream of a government forced down the drain because

of ineptitude and financial mismanagement.

We won't see ministers allowed to turn over the responsibility of

their department to others who don't have responsibility to the people,

such as happened with the former member for Cowichan-Malahat (Mr.

Strachan) when the Department of Transport and Communications, Highways

and then the Insurance Corp. of B.C. were turned over to someone who

was not elected by the people of this province.

The Department of Mines — a similar situation, where legislation was

drafted and was introduced by a person in absentia who was never

elected by the people of this province. I refer to John Mica and Hart

Horn, who were the people who were charged with the day-to-day

operation with those departments and had no one to answer to.

We won't see the kinds of contracts for government employees which

see the government of the day locked in for terms ranging up to 10

years with no way out except to buy off those contracts with large

outlays of public money. I'm sure an auditor-general would bring it to

the people's attention in enough time to save us from those kinds of

things.

There won't be the Cass-Beggs affairs — the pension arrangements

which are twice as good in many cases as is made available to any other

public servants, memberships in the Vancouver Club. Those kinds of

things should be made impossible to happen because of the watch-dog

aspects of the auditor-general.

The $100 million overrun in the Human Resources department. The

Vancouver building — where we see a project of $40 million or $50

million escalating to $130 million because no one was watching — not

even a project manager appointed to a $130 million construction

project. Incredibly bad management; incredible stupidity on the part of

the previous government. Hopefully, that can never happen again because

of this bill which has been introduced to this House this week.

So many things happened over the past three years, and they need to

be detailed, Mr. Speaker, because only those things that happened in

the past make it necessary in the future to have an auditor-general in

British Columbia.

The former Minister of Lands, Forests and Water Resources (Mr.

Williams) — probably the actions of that minister alone make it

necessary for an

[ Page 2135 ]

auditor-general. That minister alone probably got this government

and this country and this province into more trouble than any other 10

people in government, including the former Premier.

I can recall the purchase of the British Columbia Telephone Co.

stock some years ago. We were talking about that in this House, and

called to the attention of the House were some statements which were

made in a manifesto drawn up by the former Minister of Lands, Forests

and Water Resources in which he indicated that there was only one way

that a socialist government should ever take over business in this

province, and that was not to honestly get out and purchase it,

negotiate a purchase price, but to depress the stock — and when the

stocks are down, pick them up at bargain sale prices.

That's what happened with British Columbia Telephone Co. stocks, Mr.

Speaker, and who got hurt? It was not some rich financier in New York

or Boston or Zurich but the thousands of senior citizens who, as

pensioners, put their money away in something they thought was safe for

the future. Then this government came along and caused them to lose

faith — not only in the government, but to lose monetary value in their

very savings.

Interjections.

HON. MR. McCLELLAND: That's got everything to do with the

auditor-general, Mr. Speaker, because it's that kind of irresponsible

action which won't be allowed any more in this province because of the

appointment of an auditor-general.

I recall, in this House, Mr. Speaker — and we'll deal with maybe a

couple of more items that the former Minister of Lands, Forests and

Water Resources got himself involved in — the takeover of Can-Cel. I

recall asking the question in this House one day in March a couple of

years ago. I asked whether or not it was true that the government was

purchasing to take over that company. A few days later it turned out

that it was true. Trading in the shares of Can-Cel was suspended, but

they weren't suspended until after a lot of people knew that the

government was actively involved in the purchase. I know that if that

came to my attention as a lowly back bench member in the opposition at

that time, I'm sure that lots of other people must have known as well,

Mr. Speaker.

It's that kind of irresponsibility, again, in protecting the public

purse, that makes us concerned in this province that it never happens

again, and again it's a reason for the auditor-general in British

Columbia. Who got what out of that deal, Mr. Speaker? We've asked that

question in the past and it's never been answered to our satisfaction

or to anybody's. It wasn't even investigated.

AN HON. MEMBER: It's being investigated now.

HON. MR. McCLELLAND: Then, Mr. Speaker, there was a famous

deal in regard to Ocean Falls, the shining jewel in the crown of the

NDP, in which again we asked the question about a deal that was made

with....

MR. D.F. LOCKSTEAD (Mackenzie): You were prepared to let it die.

HON. MR. McCLELLAND: Mr. Speaker, the deal was not made with

any kind of businessman in British Columbia, nor through direct

negotiations with Ocean Falls and buyers of newsprint all over the

world, but with a New York company, Gottesman and Company, a Mr.

Wallach, who was considered to be in the black-market business in the

newsprint business. That's a term that's used. It's not one that I

invented. It's well known in the newsprint business. But we made a deal

with that man, the former Minister of Lands, Forests and Water

Resources, which is still secret, as far as I know, and which was kept

secret at that time. The deal was made when newsprint was selling for

anywhere from $500 to $640 a ton. We were locked into a deal which — we

can only estimate — was around $213 to $250 a ton. There was a profit

of $400 a ton to a blackmarketeer operator in New York, not even in

Canada, by that former government. That's another reason why Mr.

Speaker, this bill is most necessary, so those excesses can never

happen again.

Mr. Speaker, that former government has a lot to answer for to the

people of this province, and it will take years and years before all of

the little secrecies that were developed, particularly by the former

Minister of Lands, Forests and Water Resources, are revealed to the

people of British Columbia. But you can bet your life they will be

revealed, Mr. Speaker, and we'll do everything we can to help the

people of British Columbia find out the truth about the last three and

a half years. Hopefully, because of the actions of the present Social

Credit government in providing this province with an independent

auditor-general who will be able to keep review on all of the

province's financial activities and others, that kind of thing will

never happen to the people of this province again.

MR. D.G. COCKE (New Westminster): You're a disgrace to this House.

Interjections.

DEPUTY SPEAKER: Order. Order, please!

MRS. E.E. DAILLY (Burnaby North): Mr. Speaker, I just want to

say that I think it is indeed most unfortunate, with an excellent bill

before us, that the government has chosen to use it to chronicle

[ Page 2136 ]

three years of the NDP government. Now I was wondering if we could

have a recess so the opposition members could return to their offices

to get their files which chronicle the financial excesses under 20

years of Social Credit. If this is going to be the turn of the debate,

we are quite prepared to do so.

DEPUTY SPEAKER: Is that a motion? Are you asking...?

Interjections.

DEPUTY SPEAKER: Hon. members, there is no provision in the

standing orders for a motion to recess. If the hon. member wishes to

move that the debate be adjourned, then that motion would be in order.

Order! Order, please.

Mrs. Dailly moves adjournment of the debate.

Motion negatived.

MRS. P.J. JORDAN (North Okanagan): This has probably got to

be one of the most sensitive debates that this Legislature has seen,

and I find myself, as a member who has enjoyed the privilege of serving

in this House for some time, astonished at the behaviour of the

opposition. We've just had an example where the former Minister of

Education (Mrs. Dailly), who was part and parcel of the mismanagement,

not only of the funds and the waste of the funds of this province, but

was also part of the near destruction of our educational system. She

was, in fact, part of many of the overruns in this province, and she

herself might have been guided, had there been an auditor-general, into

a position where she was having to fire recently hired consultants at

exorbitant separation fees which utilized taxpayers' money, which she

herself should have been concerned about in terms of their application

to her own department and education.

We've seen nothing but frivolous comments from the opposition in the

debate on this bill, Mr. Speaker, and perhaps that's the problem.

There's embarrassment, I am sure, on the part of the current

opposition, and there should be. But had there been an auditor-general,

such as was their commitment in the election which they won, perhaps

that embarrassment could have been saved.

I find it astonishing that the members who sit in this House should

treat this type of a bill so facetiously, and I would recall for your

attention, Mr. Speaker, the half-minute statement of the member for

Prince Rupert (Mr. Lea) last night, and the one-eighth of a minute

statement of the former Minister of Industrial Development (Mr. Lauk)

last night. One wonders why these two very powerful speakers, who have

a great deal to say on many other subjects, don't choose to speak on

this subject, Mr. Speaker. Could it be that they realize that had there

been an auditor-general under their administration they themselves

would not be suffering the acute embarrassment they are during this

debate, that they themselves would not be as guilty as they are of the

mismanagement, the waste, the extravagance and the obvious abuse of the

taxpayers' money in this province and their privileges when they were

in office?

The former Minister of Health and director of ICBC (Mr. Cocke), who

has now left the room — and, again, I can sympathize with his

embarrassment — just suggested that the Minister of Health (Hon. Mr.

McClelland), who spoke before I was up, was a disgrace to the House.

Mr. Speaker, is not the very fundamental basis of the British

parliamentary system the accountability and the spending of the

taxpayers' money or of the Crown corporate? What has happened to our

democratic process in this Legislature when accountability for the

spending of people's money is considered a disgrace? And surely that

member should feel himself, had there been an auditor-general when he

was in office...would we have had the fiasco of ICBC?

I wonder where that minister was, speaking of ICBC, when the

property acquisition people appointed by the NDP for the purpose of

acquiring property throughout British Columbia for ICBC claims centres

took aside the then minister in charge of ICBC, Mr. Strachan, and, I

understand, the then Minister of Health and director of ICBC, Mr.

Cocke, the current member for New Westminster, and told them that they

were deeply concerned about the amount of money that ICBC was spending

for property in this province which was overinflated in value and which

was improper in terms of location for ICBC claims centres.

I am sure that my colleague from Kamloops, the hon. Minister of

Consumer Services (Hon. Mr. Mair), can speak with eloquence on the

purchase of the ICBC property for the claims centre in Kamloops, when

at that time, Mr. Speaker, the director of ICBC, who would have been

subject to the scrutiny of an auditor-general had there been one, was

shown more than three pieces of property in Kamloops, two on the

outskirts which were ideal in terms of location — when one considers

traffic flow and the congestion that a claims centre can create — in

terms of land use and zoning, and in terms of price. They drove by a

very expensive piece of property in downtown Kamloops, and the manager

said: "I want that." I believe it was $350,000 for an inadequate piece

of property in terms of size for the building itself and its parking

area, an inadequate piece of property in itself in terms of traffic

flow, and now a source of

[ Page 2137 ]

considerable traffic congestion in Kamloops.

Should not this be discussed both in this Legislature, and in terms

of public knowledge? I believe it should. For the man who was advised

that this type of nonsensical and irresponsible spending was taking

place within this Crown corporation to do nothing about it, calls loud

and clear for the establishment of an auditor-general, such as we have

in this bill.

But what is even worse is for that minister to sit and suggest that

this type of disclosure is a disgrace — that can only compound our

concern that he himself did not honour his responsibilities when he was

a minister. This government is determined, regardless of what it has to

live with, to honour its responsibilities. And why didn't that minister

take his directors aside and say that ICBC land acquisition would be

put on a more responsible basis?

I must also refer to the statement last night by the second member

for Victoria (Mr. Barber) — and I don't wish to elaborate to any great

degree upon what was said by the Minister of Health (Hon. Mr.

McClelland). But I too find it extremely difficult to accept the fact

that a new member, admittedly a new member, to this House should take

upon himself that which is in fact morally right to be discussed and

what in fact is legislatively right to be discussed in this House. It

may come as news to him that there are 55 members in this House, all of

whom are charged to be here to represent the people of this province,

to express their concern and to fight for their rights, to call for

reason and accountability in the management of the affairs of this

province.

When one equates his statement and the action of the opposition last

night when one of the most important bills to come before this House

this session — one of the leading pieces, if not the leading piece, of

legislation in Canada today, a bill that would establish the greatest

amount of public accountability of any government in the world.... That

they should treat this matter so lightly as to walk out of the House

only proves again that the NDP, who were irresponsible in opposition

formerly, who proved themselves irresponsible in government, are again

proving themselves irresponsible in opposition.

Mr. Speaker, if they are in such support of this bill, if they feel

the need for an auditor-general is so strong — as I'm sure they do, and

we appreciate their support — if they feel debate is not necessary, I

would ask: why, when the appointment of an auditor-general was a major

part of the NDP platform in the 1972 election, and they as a government

brought in sweeping legislation with little preparation, did they not

meet that commitment? One has to ask if, indeed, they realized, once

they got into government, that the perquisites of office and the lavish

use of taxpayers' money was a very comfortable position, and they

weren't about to upset it by having the inquiring nose of a free and

unencumbered auditor-general looking into their affairs. It certainly

would have been to their advantage.

The member for Victoria asked why we should talk about the situation

in British Columbia as is past and as is today. I would suggest, Mr.

Speaker, the reason is that the crucial problems we face in British

Columbia today in terms of our productive capabilities, in terms of our

private sector to compete with government sectors in reward for work

and remuneration, and in terms of our ability to generate an economy

that will provide the necessary taxes to provide the necessary and

desirable services to people, is a direct result of the mismanagement

of the NDP government when it was in office.

If one doesn't learn from history, what is the point of life and

what is the point of history? Surely we, as government, would be very

irresponsible in our attitude if we didn't learn from the mistakes made

by that government. Surely he, as a new and very altruistic member of

this House, would be derelict in his responsibility if he didn't

realize there is more to being a member of this Legislature than talk,

and that we all have to learn from the past, and none of us can run

from the truth, and that we have to relate the need for legislation in

this province to the future as well as the past.

If a child is the product of neglectful parents, then most

psychologists assume that the child will be also. This member should

recognize that he and his party are the child of the former Minister of

Finance (Mr. Barrett). They are today working to have this Minister of

Finance re-elected to this province, and in so doing, he should

understand the role that the Minister of Finance played in both the

need for this legislation and in the serious financial consequences in

which this province is in today. He can't hide it, and hopefully he

would learn from the other members' mistakes.

But the then Minister of Finance was repudiated. All his financial

management or mismanagement in this province, in the last election, in

the constituency in which he lived, Esquimalt.... He was repudiated by

the people of the constituency in which he was elected with a

12,000-vote majority, and his government, because of his financial

incapability, was repudiated by the people of this province. Surely,

Mr. Speaker, this must show something to the members of the House as it

does to the people of this province. That was the one man who could

have brought into British Columbia at that time an auditor-general who

could have had the capability and, hopefully, the freedom to do what he

should have been there to do. Mr. Speaker, that member should realize

that under that former Minister of Finance's (Mr. Barrett) direction,

when there was no auditor-general, in 1974 this province, under his

guidance, ran at a loss of

[ Page 2138 ]

$930 million a day.

Interjection.

MRS. JORDAN: Pardon me, $930,000 a day, Mr. Speaker. The BCR,

under his direction, was losing $87,000 a day. ICBC was losing 99,178 a

day and B.C. Hydro transit was losing $46,575 per day. The B.C. Ferries

under his direction, when there was no auditor-general, was losing

$68,493 per day, and the total for that year was significant in that

they lost $1,231,246. Had there been an auditor-general with the scope

that this bill gives an auditor-general, then, perhaps — in fact I am

sure — British Columbia wouldn't be in the serious situation,

financially, that it is today.

It might interest the members to know that the former Premier, now

David Barrett seeking re-election, who was defended by the member for

New Westminster (Mr. Cocke) last night as a member who did not derive

any personal big gain from being in government was, in fact, the man

who raised his own salary from $30,000-odd a year to $52,000 a year. He

increased his own personal expenses, as Premier, to $22,000 a year — a

sum that then was out of proportion to what the private sector was

paying in British Columbia.

Perquisites of office — some members have talked about club

membership. They've talked about nightclub bills. We know about the Taj

Mahal next door. I won't go over them all. But we must ask, and surely

an auditor-general would have asked, when that Minister of Finance, who

had scheduled a personal trip to Japan to play soccer, suddenly found a

reason to make it an official government visit and had his fare paid

for by the government. While he was away, Mr. Speaker, his government

was losing thousands and thousands of dollars. The estimate is that in

the 15 days of the then Premier's tour of Japan, while he was playing

soccer, his government in British Columbia was losing $18 million-odd.

Surely, Mr. Speaker, had there been an auditor~general, there would

have been a voice to support the voice of the members of the opposition

who felt there should be more accountability in our province.

That member asks why there should be a debate. I would remind him of

the practices introduced into this House by the former Minister of

Finance in relation to B.C. Hydro. At all times, B.C. Hydro borrowing

had been brought into this House for acceptance by this Legislature by

a separate bill. But the then Minister of Finance, who secretly had a

change of direction in mind, introduced this in an omnibus bill — two

lines — and he advised this House in two lines that he sought authority

to borrow up to $500 million for B.C. Hydro. Members of this House know

that type of a debate limits the discussion solely to the two lines and

greatly stifles the scope of debate. It was only by a quirk and the

diligence of the opposition that we found out that the Minister of

Finance intended to go to the open market to borrow, as he said up to

$100 million. We wonder, if there had been an auditor-general then, if

those statements might not rest as an epitaph to that former Minister

of Finance. The question is to his credibility, if not integrity, when,

in fact, he borrowed up to $300 million in the open market. I won't go

through the record of Hansard , Mr. Speaker, because it is familiar to

many members.

Secretive government, under the man who ran in an election and whose

12 years in this House.... Statements hung ever and ever around the

fact that he wanted open government, that he wanted proper management

of the affairs of the people of this province, and that he wanted an

auditor-general, but he never saw fit to introduce one.

The same thing happened with the B.C. Rail. In Hansard on June 16

it's recorded during the debate that the Minister of Finance suggested

that there had been a grant made to the B.C. Rail. In fact it's only

now clear, or not even now clear, whether this was a loan or a grant.

HON. K.R. MAIR (Minister of Consumer Services): Or a groan!

MRS. JORDAN: Or a groan. It was a groan, Mr. Speaker, and the

people of this province are groaning now under the weight of that

loan/grant groan.

Mr. Speaker, what was worse was the then Minister of Finance trying

to lead the people of this province into believing that this was for

capital cost. I won't go into all the quotes, but any member can look

it up in Hansard to find where the current Minister of Labour (Hon. Mr.

Williams) and member for West Vancouver–Howe Sound made it clear to the

public, in questioning the Premier, that in fact the railway was

operating at a deficit and that these moneys, which were supposedly a

loan-grant and also which were going to be borrowed and were supposedly

for capital costs, were in fact to cover losses, operating costs and

other sundries.

Integrity in government? Integrity on the part of the former

Minister of Finance? The member for Victoria (Mr. Barber) should look

to his own House before he starts casting stones at other houses.

Mr. Speaker, I strongly support this bill and the need for it. I

believe that throughout Canada and in British Columbia there is a

growing concern on the part of the public about the complexity of the

government. I believe that government members are concerned about the

growing complexity of government — the complexity and the problems of

trying to finance government and not tax our people so they have no

opportunity to make their own decisions in terms of financial spending.

The people

[ Page 2139 ]

in British Columbia do not want the Swedish type of government here where people have no free change in their pockets.

MR. R.E. SKELLY (Alberni): They have an auditor-general there.

MRS. JORDAN: Well, why didn't you bring one into this House,

Mr. Member? You were a powerful member of your government. You were

always flying the flag of how you were going to do away with private

industry.

DEPUTY SPEAKER: Order, please!

MRS. JORDAN: Where was your voice? You're very talkative now,

but you weren't very talkative when you were there. Why didn't you

stand up for the people's rights?

[Deputy Speaker rises.]

DEPUTY SPEAKER: The hon. member is well aware of the fact

that in order to preserve order in this House, we must continue to

address the Chair, and I will ask you to do so.

[Deputy Speaker resumes his seat.]

MRS. JORDAN: Thank you, Mr. Speaker. I meant no disrespect.

But it is interesting that such a comment should come across the floor

from a very powerful member of the former government to say that Sweden

has an auditor-general. Perhaps he'd like to know that the people in

Sweden are also taxed to death and have very little freedom. If he went

there, he would find out. But I'm not here to discuss the problems of

Sweden; I'm here to see these problems don't occur in British Columbia.

I believe, Mr. Speaker, that the people of this country and this

province have lost confidence in the spending capabilities and the

responsibilities of their government at both levels, and they've lost

confidence in the accountability of government, at both the political

level and the professional civil servant level, in terms of the careful

and prudent handling of their funds.

We hope, as a government, through this bill and this type of

unbridled public accountability, that our civil service — which in most

instances are very cautious and very responsible in terms of public

spending, but like the rest of us, need to be brought to task once in a

while in terms of our responsibility — will respond to the knowledge

that there will be accountability and public scrutiny by the

auditor-general, and that we as politicians will be subject to this

type of scrutiny.

This affects us in this Legislature, and, more directly, it affects

our ministers. I personally have great respect for the Premier of this

province and our ministers in terms of this legislation, because it's

going to be most difficult for them. This is why other jurisdictions

have in fact avoided this type of legislation in terms of the scope and

the freedom and the non-partisan influence that is exhibited or exerted

upon the auditor-general. For they are the ones, Mr. Speaker, who

ultimately must wrest with the auditor general's comments, and I'm sure

they are very much aware of it.

I suspect, Mr. Speaker, that at times in the future members of this

government will groan and say: "Why ever did we bring in legislation

with the extreme scope this legislation has?" But the government is

fully aware of this and again, in my view, are proving that they are

determined that we will have true accountability in this province. They

are determined that this government's future will be guided to a large

degree by their ability to satisfy that auditor-general.

I'm sure, Mr. Speaker, also there will be times when the opposition

will have gleeful afternoons in this Legislature as they interpret the

auditor-general's reports and will use them to best political

advantage, which is their privilege.

I feel there are outstanding points in this bill. Certainly the

innovative approach to the appointment of the auditor-general by

unanimous decision of a special committee of this Legislature is the

first of its kind, I believe, in the world other than the Communist

countries, and I commend this. I feel that this in itself will prove

the need for greater cooperation in solving the problems of this

province in a responsible manner by all parties. It seems a logical

step in terms of the fact that the auditor-general is indeed

responsible to this Legislature and solely to this Legislature.

Mr. Speaker, this party's made it clear through other legislation

that we have been discussing which I won't touch on directly that this

party does not believe that boards and non-elected people should not be

subject to public scrutiny and that they should in fact not have the

power to invest the people's money without the authority of the cabinet

and this Legislature.

It's interesting that in discussing this bill the NDP are so

favourably inclined to accept this approach, as far as the

auditor-general is concerned, but as recently as three days ago were

not inclined to accept that approach in terms of withdrawing the

extensive spending powers that were given by the NDP to non-elected

boards and individual ministers. That's somewhat of an inconsistent

position, I would suggest.

Mr. Speaker, this type of an appointment would seem the most secure

way of ensuring that this auditor-general, be it a he or a she, will

indeed be free

[ Page 2140 ]

of any political affiliation. The provision of a six-year term does

indeed provide stability and a degree of security to the individual

appointed, without tying the hands of the Legislature and without

allowing the auditor-general, who could be subject to complacency, to

become complacent in office.

I would hope also there is provision for scrutiny of the auditor-general's expenditures, which there is.

The freedom given to the auditor-general in

section 5(5) provides

him or her with the right to make a special report to the Legislative

Assembly if they find that his budget or his treatment by the Public

Service Commission in relation to his duties there is questionable.

This again allows a degree of freedom found nowhere else.

section 5(5)

exists to ensure that in no way is this individual being hindered in

the carrying out of his duties by any member of this government.

section 8, the fact that the auditor-general has the freedom to

comment on anything resulting from his examination that he considers

should be brought to the attention of the Legislative Assembly, whether

it's in terms of Crown Corporations, ministerial or departmental

spending or overall government spending, again ensures his or her

independence, and he has the freedom to draw this to the House's

attention.

There is the opportunity to speak on management auditing. For

example, if he found that funds had been misplaced through fraud or

mistake, or unauthorized expenditures had been made, the demand that he

be required to comment upon the rules and systems of the control and

the audit-management system again ensures the independence and the

opportunity for another review.

The government, as the minister stated, deems this as a most

appropriate base of accounting in terms of what the auditor-general

would recommend.

I believe it is significant and worthy of note, Mr. Speaker, to make

it clear that British Columbia is the first province to place the words

"economically and efficiently" in the statute itself, and of course,

that's one of the driving motivations of this bill.

Mr. Speaker, through this bill our government hopes that for the

first time in the history of this province the people of British

Columbia will in fact have full and responsible public accountability

on the part of its civil servants and professionals, on the part of its

politicians, and on the part of its Crown agencies.

We hope that this will be one step in the right direction towards

seeing the people of British Columbia again regain a degree of

confidence in the integrity of all their elected members and in the

integrity of their government, and that they will recognize that

government, along with people, are willing to stand up and be

accountable; that they are willing to resume their responsibilities,

whether it hurts or not, as it may well do, and that in return the

people of British Columbia will recognize that this is a social feeling

that must be strengthened in British Columbia, whether it's among our

young people, the private enterprise system or retired people. All of

us, in our own way, are accountable for our own actions and the actions

of the groups with which we are working or allied. This sense of

individual responsibility is the only avenue we have to strengthen and

increase the democratic process in this province.

Thank you for your attention, Mr. Speaker, and I hope that the

success of this bill in the first six years of the auditor-general will

justify the debate that has taken place in this House over the last few

days.

HON. K.R. MAIR (Minister of Consumer Services): Mr. Speaker,

I have no doubt whatever that during the course of this government's

tenure in office, the auditor-general will be, from to time, an

embarrassment. No matter how good a job we do, and we will do a

first-rate job, his job will be such that, from time to time, as the

member for North Okanagan (Mrs. Jordan) has just said, great glee will

be expressed from the opposition. We pass this bill in full knowledge

of this. We bring this bill to this House as a responsible act. The

members across there have said: "Why wasn't it done 20 years ago?"

Well, perhaps, Mr. Speaker, because it took the events of the last

three and a half years to make us all realize just what happens when

the province's, finances are so badly managed.

Now, Mr. Speaker, I must make comment, if I may for a moment, on the

pious words of the wandering minstrel, the second member for Victoria

(Mr. Barber), who was in my riding not long ago giving little speeches.

I should have told him that his party sent their best guns up there

last November and December to no avail. But he was there, Mr. Speaker,

and he was here yesterday, clucking his tongue, unctuously and piously,

about the remarks made from this side of the House concerning the

events of the last three years. I ask that member, Mr. Speaker, through

you: where was that pious, unctuous tongue-clucking when the Leader of

the Opposition (Mr. King) and before him the member for Prince Rupert

(Mr. Lea), were talking about the Sommers case? I didn't see that

member get on his feet and say: "Hey now! This is unfair, this is

rotten, this is no good. You can't talk about events of the past that

have been paid for."

HON. MR. McCLELLAND: He talked about it himself.

HON. MR. MAIR: He talked about it himself. You're right, Mr. Member, thank you very much.

No, he chooses to get on his feet, Mr. Speaker,

[ Page 2141 ]

when it's a little uncomfortable, when it hurts....

DEPUTY SPEAKER: Order, please, Mr. Minister. You will be proceeding to the principle of the bill?

HON. MR. MAIR: Yes, I'm getting to the principle in just a moment, thank you, Mr. Speaker.

Mr. Speaker, where indeed was that member when Wenner-Gren was

brought to the attention of the House a day or two ago — Wenner-Gren?

You know, Mr. Speaker, there are some people in this House who were

school children when that — if it ever was an issue — was an issue.

Where indeed was that sacred defender of the rights of parliament and

the honour of debate when the question of the Columbia River was

brought up by the noisy one across, who is, as usual, in his seat

making remarks across the House?

Interjections.

HON. MR. MAIR: The pious claptrap, Mr. Speaker, is rather

symbolic and rather interesting when you consider that it only comes

out when the shoe happens to pinch.

Now, Mr. Speaker it seems that we have some rules in this House that

they are worthy of note by all of us. It seems that when we're talking

about the principle of Bill 45, the auditor-general bill, any

discussions of ICBC and $181 million is a no-no, but it's okay to talk

about some Wenner-Gren deal 20 years ago. It seems, also, Mr.

Speaker....

Interjections.

HON. MR. MAIR: I'll get to you in a minute.

It seems, Mr. Speaker, that it's not fitting and proper to talk

about a $102 million overrun in the Department of Human Resources which

occurred a year or two ago, but somehow a man who has paid for his

transgressions and is living quietly, is going to have his case brought

up by the members across as being appropriate matters of discussion. It

seems that it's not appropriate for members on this side of the House

to discuss the B.C. Building and the shambles and the reruns and the

little deals with architects and the changes in plans — things of that

sort — but their convoluted, distorted rendition of the Columbia River

Treaty is quite apropos.

Mr. Speaker, they then follow their pious claptrap by walking out of

the House — the final abject act of surrender by a party that ought to

have given up three and a half years ago for the good of the province,

and certainly ought to give up now.

SOME HON. MEMBERS: Hear, hear!

HON. MR. MAIR: Mr. Speaker, I think it appropriate, too, if I

may, to bring to the attention of the House, on the principle of Bill

45, that I'm sure the House in its deliberations listens with great

care to the statements made by members in debate. I think the House

always trys to judge the validity of those statements in the light of

the member's performance.

I would like to direct this House's attention, if I may, Mr.

Speaker, to a remark made a few weeks ago by the first member for

Vancouver Centre (Mr. Lauk) who advised us that in his youth in

Vancouver there were signs in parks which contained those words: "No

Dogs or Chinamen Allowed." Do you remember that?

Mr. Speaker, I lived in Vancouver; I was born in Vancouver. I didn't

live in the same part of town, to be true, but I played in all the

parks, and I don't remember those signs. I did a little survey among

all of the people whom I know in Vancouver who would remember; they

don't remember those signs. Then I looked at Hansard . Do you

know what Hansard said? It says that we'll find them in the Provincial

Archives or the city archives. Mr. Speaker, I consulted the archivist

in Vancouver, and I consulted the archivist for the provincial

government. No such evidence of any such signs exist. They simply were

never there.

Interjection.

HON. MR. MAIR: No. I found another funny little thing as I

did my research, members of the House and Mr. Speaker. I found, through

a friend of mine who runs a restaurant on Pender Street in Chinatown in

Vancouver, that such a sign does exist. It exists in the city of

Shanghai; it exists in the old British Concession in Shanghai. It

exists there to this date to show the arrogance and the racial

prejudice so often practised by the white man. And so it should remain

there.

To cast a slur upon the citizens of Vancouver and this province for

the cheap political advantage of the night bespeaks of the member's

accuracy and tells us something about the quality, if not the quantity,

of the remarks that member makes in debate, particularly in debate on

this bill.

Mr. Speaker, the point the member made at that time was a good one

in the sense that prejudice existed, still does exist and must be wiped

out. But to bring to this House, in support of a position on a bill,

such inaccuracy, I suggest, gives us a clue as to how much attention

this House ought to pay to statements made by that member and, indeed,

his confreres as a principle on bills like Bill 45.

Bill 45 will ensure that the mistakes made by this and future

governments will be very quickly brought to the attention of the

Legislature for their action. Bill 45 will make sure that British

Columbia will go forward to prosperity, unfettered and untarred by

mistakes undisclosed and hidden. It will make sure that

[ Page 2142 ]

governments not only will behave themselves but that they will seem

to behave themselves, and that this Legislature, once again, will be

the master of the public purse.

MR. G.V. LAUK (Vancouver Centre): On a point of order, Mr.

Speaker. The hon. Minister of Consumer Services did some research,

being underemployed, with respect to the signs that I mentioned in my

remarks that have no bearing on this bill. But I think the record

should be set straight. The sign I referred to — there were several in

the city back in the 1920s and just after the First World War — I

didn't say I saw it....

Interjections.

DEPUTY SPEAKER: Hon. Members, order, please. Please allow the member to state his point of order.

MR. LAUK: If I did, certainly I should correct the record because I didn't see the signs in....

SOME HON. MEMBERS: Order, please!

MR. LAUK: What's going on over there? What on earth are you trying to do?

DEPUTY SPEAKER: Hon. Member, if you would proceed to your point of order....

MR. LAUK: The signs that appeared in these parks were well

publicized in the local press. They were in the possession of Major

Matthews and, I understand, his possessions were transferred to the

city archives. If they haven't we'll check with Major Matthews' estate.

The first time I heard about these signs it was drawn to my

attention, Mr. Speaker, by the Attorney-General of the province, whose

name at that time was Leslie Peterson, who spoke to a civil rights

group in the Hotel Vancouver, some seven or eight years ago, who had

the sign with him, displayed it and made a speech about it.

DEPUTY SPEAKER: Thank you. The point is well taken.

MR. G.H. KERSTER (Coquitlam): Mr. Speaker, I rise to speak in

support of Bill 45, and with great pride. The second member for

Victoria (Mr. Barber) said last night that the hon. Minister of Finance

introduced Bill 45, the Auditor General Act, in a very dignified

manner, and I would agree with him. I must commend the hon. minister

not only for his dignified introduction of the bill, but also his

exhibition of self-discipline and self-control in doing so, considering

yesterday afternoon's diatribe by the official opposition in the debate

on anti-inflation measures.

The hon. Minister of Health (Hon. Mr. McClelland) earlier this

morning noted that the second member for Victoria's sanctimonious

approach was somewhat objectionable when everything the opposition

doesn't like to hear comes to debate on the floor of the House. I think

that member should produce his own standards according to Bill 45....

DEPUTY SPEAKER: Order, please. May I interrupt the hon.

member? Not just for the edification of the member who is standing on

his feet, but for all members: the debate on the principle of the bill

clearly must encompass the need for the bill and the disadvantages of

the bill, rather than the disadvantages and advantages of other hon.

members.

I would encourage the member now speaking to get to the principle of the bill shortly.

MR. KERSTER: I will, Mr. Speaker, get to the principle of the

bill very shortly. The principle is the principle of standards — a

single standard and a double standard. I think that member should

reduce his standards to a single standard before preaching to this

House like some misguided child actor. The double standards of debate

that he would like to see employed in the House serve he and his party

well, but not the people of this province, and that's the standard that

we are trying to achieve.

Bill 45 serves the people of this province, as does Bill 16, which

he attacked so vehemently yesterday in this House. This Bill 45 is the

finest legislation of its kind in North America. It is something we can

be proud of.

You people in opposition know why it was introduced, but just in

case you've forgotten, here's a simple reminder, easily understood: to

prevent the kind of irresponsible conduct of the financial affairs as

witnessed during the past three years that has left this province in

the poorest state in over 20 years. This bill should and must be

debated by all members of this House, on the floor of this assembly.

The people of this province have the right to know the truth — the real

truth about the wastes of the past administration, which would not have

been had we had Bill 45 in effect at that time, had we had an

autonomous auditor-general.

An auditor-general, they say, is an excellent idea. They're all

willing to stand up and vote for it when they are in the House, but why

didn't they bring in an auditor-general's Act when they were in office?

That's a darn good question.

The opposition had better face up also to the fact, Mr. Speaker,

that the former Premier (Mr. Barrett), in his capacity as Finance

minister, was totally incompetent. He realized this. He fired himself,

and

[ Page 2143 ]

he threw the hot potato to the minister for Nanaimo (Mr. Stupich) just prior to calling an election he said he wouldn't call.

An auditor-general, if we had had one during the past

administration's brief term, would have brought some of these points to

the attention of the assembly, and I'm just going to mention four. In

the first seven months the NDP were in office wages and salaries for

all departments were up by $28,999,000. Directly and indirectly the

taxpayers of British Columbia paid the wages of 51,788 employees. The

government and its agencies spent over $250 million in buying up the

contracts of people they fired, including $52,500 for the employment

contract of an ICBC employee for an 18-month period. This is really

sound financial management, isn't it? It's something to reflect upon.

You should be ashamed. That's $2,916.67 per month of waste and

extravagance.

As of April, 1972, when you took power, the number of employees in

this government was only 29,444, and we were on a fiscally responsible

scale. As of June 30,1974, you'd solved a portion of the unemployment

problem. You'd hired some 14,000 or 15,000 people; you'd brought the

government rolls up to 43,722 people. That kind of nonsense would have

been brought before this House by an auditor-general if we had had one

at that time.

Now the scope of the auditor-general's responsibility and the

autonomy of his department will guarantee that we, as legislators, are

accountable to the people of this province, as we should be, to assure

that the most fiscally responsible attention of all departments of

government is assured and that public funds are not abused.

I'm proud of this legislation and the fact that the people of this

province will never again be in the dark as to their financial

condition. We are not afraid of public scrutiny of the handling of this

government of public funds. We won't be irresponsible. We're proving

this by the introduction of Bill 45, and I'm proud to support this bill.

MR. J.J. KEMPF (Omineca): I am also happy and eager to take

my place to speak in favour of Bill 45, the Auditor General Act. I'd

like to begin by complimenting the hon. Minister of Finance (Hon. Mr.

Wolfe) for introducing such legislation — legislation long overdue in

this province of British Columbia. I'm also proud, Mr. Speaker, that

this party will honour yet another campaign promise made prior to

December 11, 1975.

This Act will ensure the people of British Columbia that their

financial affairs will be carried out and presented honestly, fairly

and accurately. I have no doubt that this bill will pass unanimously. I

do, however, believe that the people of this province should once more

know why there is a need for such a bill, the need in this province for

an auditor-general.

Bill 45 will ensure the people of British Columbia that there will

be no more coverups, that there will be no more mismanagement, that

there will be no more spending, as if water, of the taxpayers' money,

as was seen during the term of office of that previous administration.

There will be no more multi-million dollar losses, as was seen in ICBC,

and was seen in Human Resources by that previous minister of dogs on

welfare over there.

SOME HON. MEMBERS: Oh, oh!

MR. KEMPF: The previous administration of dogs on welfare.

The job of the auditor-general will ensure that the taxpayers' money

will be spent wisely and with discretion, not at random with no

control, as was the case in the Barrett-Williams government.

Interjections.

MR. KEMPF: Existence of an auditor-general in British Columbia will ensure that there'll be no more rental or

purchase of empty buildings in this province. I'd just like to go into

that a bit, Mr. Speaker. There was 5,054 square feet of office space leased October 1, 1974,

in the Oxford Building in Prince George at a cost to the taxpayers of this province

of $25,000, and left empty for nine months.

There was 7,818 square feet of office space located in Surrey which remained

vacant for one year at a cost of $34,000 to the taxpayers of this province.

There was 30,000 square feet of office space located in the McLaren Building

in Burnaby which remained empty for one year at a cost of $131,000 to

the taxpayers of this province. There was office space and warehouse space located

in Esquimalt of approximately 1,500 square feet and left empty for nine months

at a cost o f $35,000 to the taxpayers of this province. It goes on and on.

A warehouse property in Esquimalt, which has remained empty for one year, was

purchased for $400,000 of the taxpayers' money in this province.

The existence of an auditor-general in this province will ensure

that that will never happen again. No more bungling, as was seen in the

Barrett-Williams government — Barrett, Williams, the two individuals

attempting a game of musical chairs in Vancouver East. The existence of

an auditor-general in the province of British Columbia will ensure that

there will be no more Taj Mahal in this province — never again a Taj

Mahal — and I quote from an issue of the Vancouver Province of January 8, 1976, and it said: "Offices for Bob Williams — $350,000 for Taj Mahal" — $350,000, hon. members.

MR. R.E. SKELLY (Alberni): Are you tearing it down?

[ Page 2144 ]

MR. KEMPF: And I read:

"The former NDP government spent $350,000 on

developing new offices in the east wing of the legislative buildings,

Public Works minister Alex Fraser announced today. The offices, which

were for Resources minister Bob Williams and his personal staff and

cabinet planning adviser Mark Elieson and his staff, have been

described by some as excessively luxurious and nicknamed the Taj Mahal,

but Fraser said he had no comment to make on the cost, which averages

out at $37 a square foot. He said senior department officials had told

him that though that seems high, it was considerably less than that

which was spent on the development of cabinet ministers' offices during

the last three and a half years."

Although construction costs were lower, those renovations cost $52 a

square foot, hon. members — $52 a square foot of the taxpayers' money

of the province of British Columbia. Never again, with an

auditor-general. Never again, in the province of British Columbia. No

more

flagrant mismanagement and misuse of the taxpayers' money.

My constituents, Mr. Speaker, support this bill, as they remember

Plateau Mills. They remember very well Plateau Mills. That was an

expenditure of $7 million of the taxpayers' money at the discretion of

a minister. It was spent in order to put two independent operators out

of business, and it cost the people of Vanderhoof 350 jobs — at the

discretion of a minister. Never again in the province of British

Columbia with an auditor-general. Never again in this province will we

have that kind of spending at the discretion of a minister.

MR. C.S. ROGERS (Vancouver South): I wanted to get up ahead

of the member for Kootenay (Mr. Haddad) because you remember last week

the Leader of the Opposition (Mr. King) said that he felt he might make

the opposition disappear? He did that last night, and I would hope that

they would stay for my remarks this morning because I know that if that

minister had arisen and gone through his usual routine, they may have

left.

Canada's most famous auditor-general was a gentleman by the name of

Maxwell Henderson. I would like to point out that if we'd had Maxwell

Henderson here in 1972, 1973, 1974, 1975, et cetera, we might not be going

through this procedure that we're going through right now.

I wonder what Maxwell Henderson.... Remember, he was the man who

found the Bonaventure and embarrassed the Liberal government in Ottawa

so badly that they had to fire him. This Act which has been prepared by

the department is so well written that, in fact, if the auditor-general

does embarrass the government he can't be disposed of as the Liberals

disposed of Mr. Henderson.

I wonder what Maxwell Henderson would have said about a government

which bought a fleet of aircraft, ostensibly as air ambulances, only to

find out, in fact, that you couldn't put a stretcher in the aircraft. I

wonder what Maxwell Henderson would have said about the acres of trees

we bought for no particular use. Maxwell Henderson would certainly

enjoy this afternoon's tour of a vault where the art is collected by

the Department of Public Works, which is at 1400 hours this afternoon

for all those who want to go. I wonder what Maxwell Henderson would

have said about the purchase of a double-decker ferries for the Swartz

Bay to Tsawwassen run and the Horseshoe Bay to Nanaimo run for which no

docks were provided. I wonder what Maxwell Henderson would have said

about the large white elephant that we find in the middle of downtown

Vancouver. Well, that's actually a nest egg. It's a hole for the egg to

be laid in for this white elephant. And I wonder what Maxwell Henderson

would have said about ICBC.

We need someone like Maxwell Henderson in this province to keep us

honest — to keep both sides honest. I'm not suggesting, Mr. Speaker,

that there's any dishonesty, but an auditor-general is a man who points

out the poorer judgments of government and any misappropriations of

funds, and therefore I will be supporting this bill. Thank you, Mr.

Speaker.

[Mr. Veitch in the chair.]

MR. G. HADDAD (Kootenay): I rise on Bill 45, the Auditor

General Act. Being a new member and not having the benefit of past

experiences, I must admit that being a member in this House is an

experience of a lifetime. At first I was convinced that everyone was

crazy. However, Mr. Speaker, I am now an inmate and becoming afflicted

with the same diseases. [Laughter.]

Interjection.

MR. HADDAD: I, like everyone else, am happy that, finally, we

have an auditor-general. I would like to quote from a newspaper

article

in regard to the past Premier and Minister of Finance (Mr. Barrett).

The headline was: "Barrett to Read Study on Role of Auditor in the

Legislature."

"Premier Barrett said Wednesday he is prepared to read

a federal report on the role of an auditor-general but declined to give

any indication as to whether he would consider a similar post for B.C."

And, Mr. Speaker, as it has been stated many times, had he done so,

it would have eliminated many of his problems for himself and his

party. I carry on with the quote:

"Barrett gave his vague answer in response to

[ Page

2145 ]

a question from Gordon Gibson (Liberal, North Vancouver–Capilano)

who wanted to know if the Premier had read the report and if he would consider

appointing an auditor-general for B.C. His reply, 'If I have the time, I'll

read the report, ' was Barrett's only answer."

The auditor-general has the authority to check all government

spending and to be openly critical if he finds waste in government

departments. Had the previous government appointed an auditor-general

there would not have been the wholesale renting of unused offices. It

would have saved the taxpayers of British Columbia many hundreds of

thousands of dollars.

Mr. Speaker, an auditor-general would have saved the previous

Premier and Minister of Finance much embarrassment and, he could

possibly have carried on with governing the province of British

Columbia. The mismanagement has cost the taxpayers of British Columbia

many millions of dollars.

The Province had an editorial Wednesday, December 24, captioned:

"Coping with Mr. Barrett's Finances." I would like to quote from this

editorial:

"That was a very expensive cat that Bill Stowe let out

of the bag in Victoria Tuesday. It will cost the taxpayers a lot of

money. It will cost Premier Bill Bennett a lot of headaches. And it

will cost Dave Barrett a few more shreds of his fast-tattering

political reputation.

"Mr. Stowe is the director of finance and economic

research for British Columbia, the civil servant in charge of budget

research. Breaking all the civil servant's vows of silence, he

disclosed that the provincial budget deficit this year won't be the

modest $40 million that Mr. Barrett predicted in his last press

conference before leaving office; it won't be a $300-odd million that

the more skeptical journalists were able to add up from the figures

that Mr. Barrett revealed. When all the accounts are added and

subtracted, it could well go higher."

And we all know that it did.

"What's worse than the enormous sum involved, really,

is the elaborate hocus-pocus that Mr. Barrett was apparently prepared

to go through if he won the election and stayed in office. In order to

cover up the real state of affairs, payment of money owed to such

obliging creditors as the federal government was to be delayed.

"Large amounts of cash were to be whipped back and forth

between Victoria and the Insurance Corp. of B.C. in a way that would keep the

transfers hidden from public view. Money the government had already spent was

to be borrowed by new Crown corporations and sent back to the treasury. Commitments

that the government had incurred this year were to be postponed until 1976 in

the apparent hope that some fiscal miracle would produce the cash next year.

"This chain of deception apparently started a year ago

when the NDP government was drawing up its budget for the current

fiscal year. When Mr. Barrett brought that budget down, in the face of

a declining economy, he was questioned sharply by the press about the

large increase in government revenue that he was predicting. He was

radiantly optimistic. His economic advisers, he said, assured him that

the economy's problems would be modest ones and a sharp recovery would

begin in the summer.

"There was some question then about who Mr. Barrett was

listening to, and part of the answer is now clear. He wasn't listening to

civil servants like Mr. Stowe who were warning him that his budget, even at

the time it was written, would be $150 million in the red. What mystic voices

were telling him that all would be well remain unknown. It may simply be that

Mr. Barrett was planning an election for mid-1975 and was willing to pad his

budget in order to present the best possible face to the voters. Those plans

may have gone awry with a long and bitter legislative session wrangling its

way too close to the first prime voting period in June and labour problems shutting

off the next prime opportunity in September.

"By late fall Mr. Barrett had to move or the tottering

financial situation would have come crashing down on his head in 1976.

As he said during the campaign, he knew the NDP was behind when he

called the election, but it would have been even further behind next

spring. Now we know why.

"It is now apparent that Bill Bennett made a wise move

when he announced this week that he would bring in a firm of outside

auditors to go over the provincial government's books. That should help

pin down the truth of the situation and remove it, in part, from the

bitter political argument that it is bound to produce.

"We also know that one other Bennett campaign promise,

under the circumstances, is about the best Christmas present the new

Premier could offer his province. He has said that he will appoint an

auditor-general, a civil service independent from the government in

power, whose job it is to review the government accounts and report

directly to the Legislature. That kind of automatic and independent

review makes it far less tempting for the government to attempt to

cover up its financial failings.

"While he is at it, Premier Bennett can do B.C. another very significant favour by taking

[ Page 2146 ]

his time in trying to get the government spending and income back

into fine. If the situation is as bad as Mr. Stowe says it is, trying

to correct it in a year would produce chaos in government services. It

would be far better for those who depend on those services, and in one

way or another that amounts to everyone in the province, if Mr. Bennett

were to resign himself to a slower combination of pruning and patience

in order to bring the situation around."

I would like to say, Mr. Speaker, that reading quotes from the

papers assists me very much in being factual, due to the fact that not

having the years of experience that some of the people have in this

House, I'm not too well acquainted with the facts.

However, I heartily endorse the Auditor General Act. I am positive

that it will bring to the province of British Columbia good, sound

government. Obviously there was some hocus-pocus in what the news media

had printed.

With that, Mr. Speaker, I would like to suggest to the entire House that this bill be approved unanimously.

HON. J.A. NIELSEN (Minister of Environment): Mr. Speaker, I

would like to rise in support of Bill 45. There seems to be no argument

from any members in the House as to the validity of such a bill and the

importance of such an appointment of an auditor-general.

One of the great concerns of the citizens-at-large in different

jurisdictions is the possibility of misuse of public funds.

Representatives of the people have an obligation to the system of

government to which we adhere that we provide the necessary officials

and the necessary offices to ensure that there can be no question

relative to the use of public funds, and that misuse of public funds

simply cannot occur.

Misuse of public funds can develop in different ways. There is the

deliberate misuse of public funds where the laws of the land can take

advantage of such a situation and criminal charges can be laid, as has

occurred in many jurisdictions around the world. But there's also a use

of public funds which is not criminal — the misuse, if you like, of

such public funds — regarding poor decisions, improper decisions or

decisions which perhaps are made not for the best interests of the

public at large but for political advantage.

An auditor-general, under Bill 45, would be in a position where he

would not only be able to investigate the actual use of funds, but he

would be in a position where he could recommend procedures which would

assure the citizens, of the province of British Columbia that the funds

were being well spent and being spent with the attitude of the

advantage to the citizens min mind. Perhaps a small example may

illustrate the importance of such an office. An auditor-general or his

staff could suggest to the Legislative Assembly that certain procedures

are inadequate to ensure that public funds are being wisely spent and

offer some opportunities for members to consider alternative methods of

either keeping records or acquiring authorization for spending of

public funds.

A short time back my department received communications from a

regional district wondering where their funds were. They were asking:

"Do you have the money that was promised?" I responded to the Regional

District of Kootenay-Boundary with a letter on February 26. In

part I

said: "I regret to advise you that I can find no record within the

department of an application for the funds you referred to; nor can I

find any commitment having been made by the department with respect to

the provision of these funds."

Another minister had received similar correspondence from the same

regional district asking for the money. In reply from that department,

one line says: "My department tells me we have no record of an

application of funds for the project."

After considerable research and correspondence with the regional

district they sent us correspondence, because we didn't have copies in

our files. The files were not in the offices so we had no knowledge of

such commitments made in the past.

The regional district was kind enough to photostat copies of their

correspondence which had been sent to them promising the funds, and I

read the correspondence which came from the Minister of Lands, Forests

and Water Resources (Mr. Williams) on November 6,1975. It's addressed

to an MLA, and it says: "Further to our discussion I hereby confirm a

grant in the amount of $5,000 towards the study of the Nancy Greene

recreation area," and that's it. That was, coincidentally, made during

the election campaign.

Correspondence indicates that a similar grant was agreed to under

the same conditions by way of a personal note from a minister to an

MLA. But as I pointed out to the regional district, to begin with we

really did not know who possibly could have made such commitments

because we had no records in our files. As I told the regional

district: "I am advised by the department comptroller that no provision

for such funds was included in the estimates of the previous year."

The problem with such a sloppy procedure of distributing public

moneys is that the people in the East Kootenays started their project

and now need the money to fulfil financial obligations.

The people in the Regional District of Kootenay-Boundary are the

innocent victims, if you like, of very, very sloppy handling of public

money. These people cannot be blamed — the people of that

[ Page 2147 ]

regional district. They received correspondence from their MLA which

said the money was coming, but the money was never allotted. It was

another election promise. After the election the correspondence is no

longer available and we get a letter from a regional district wondering

what they're supposed to do with the bills they have; and we hope we

can satisfy the regional district by coming up with the money for them,

so they need not needlessly be in debt for something over which they

really had very little control.

An auditor-general, of course, would be in a position to look at

such procedures and recommend to the House better ways of spending

public money and better ways of controlling public money, so innocent

victims, whether they be governments or individuals, are not needlessly

put in the position where they have to come up with moneys to which

they believe they are entitled, but no proper procedure was there for

them to receive that money. Promising money, obviously, is one thing,

but delivering it is a much stronger obligation.

Mr. Speaker, the auditor-general concept is held in high esteem by

most persons in our systems of government. Maxwell Henderson, a man

referred by by other members, had an excellent reputation, a reputation

that some politicians did not appreciate because he did rub their nose

in it many, many times, and rightly so. The legislation was introduced

by the Minister of Finance is excellent legislation, as is obvious by

the remarks made by those even in opposition. I'd like to compliment

the minister for the research and the preparation that obviously went

into this bill. There was a suggestion that perhaps we're giving the

auditor-general a little bit too much power and perhaps he could make

things a bit difficult for government. Well, that's certainly a chance

that is well worth taking. To have an auditor-general in a position

where he didn't have extraordinary powers would not really be

fulfilling the need in our society for such a role.

I can certainly say this government can live with a strong office of

the auditor-general, with very strong powers, and this government is

pleased to have announced, as the Minister of Finance did, that the

auditor-general is to be decided upon by a committee of the Legislature

by unanimous vote. This certainly does give an opportunity to all sides

to be heard before any person is considered. A couple of members of the

opposition have suggested names for the auditor-general. I'm not sure

if they're serious about recommending the names they have suggested so

far, but I presume that if they bring those names forward to committee

they will be considered. Thank you, Mr. Speaker.

MR. G. MUSSALLEM (Dewdney): Mr. Speaker, I rise in my place

today to discuss the auditor-general bill before this House. Needless

to say, I am for it, as all other members are, I am sure. Members of

the opposition have wondered why we would take so much time to discuss

the matter which so obviously is agreeable to all, and it should be

left and it should be voted on and passed immediately without

question. This is not correct and it would be very improper procedure

that a bill so big, so large in scope, so important to all the people

of British Columbia, should just come and pass without note. Let its

effects be taken, as time goes on, which it will. It is important to

every member and I regret that the members of the opposition did not

avail themselves of standing with us and appreciating the fundamental

principles that are exemplified here.

It was to my surprise and...complete lack of understanding of

their move yesterday when they, in a group, took it upon themselves to

vacate the House and leave us, Her Majesty's government, here by

ourselves, forcing us to change our position, to debate another bill,

at which time they did return. I think it was

an act of

irresponsibility. I'm sure at this hour today they regret it

exceedingly and, of course, I forgive them. Because, as I always say,

in the thrusts and pressures of debate things will happen that

sometimes we all regret. Sometimes we say things we do not like, but

once they're said all our tears and all our hopes, all our aspirations

would not change a single word. So we are charged with the things we

say. This bill is the great public safety valve. Certainly we all know

it. Certainly our friends opposite know it. But certainly, also, it

must be told.

It's the security. Here we are appointing a man who will be the

security of the assets of the people of British Columbia. People will

say that we have a man here — or a woman — who is totally beyond

control of the government, who can take any course they wish. I tell

you again that we must make a big thing of this in this House. It is

one of the most important bills to come before this Legislature.

It was one of the platform planks of our hon. friends when they were

government, that they would bring out this auditor-general, and more

things that they've forgotten, but this was one. I thought it was a

very commendable plank in their platform. I wonder, even to this day,

why, in three years, with the hundreds of bills — and I still wonder

why and the public wonders why — it was not brought out. Is there any

excuse for it? There's none. I recall when we were government before,

we were pressed by the opposition — the same hon members where today —

why do we not have an auditor-general? Our answer was: why do you need

an auditor-general when you have an honest government?

That was, of course, in question by the opposition, and I thought to

myself, that it was very unnecessary when we had gone through three

years of turmoil. I do not impugn wrongdoing on their part — not at all.

[ Page 2148 ]

It is not my duty or my responsibility to do that. I consider them

all honourable men. But I think one of the principles that caused the

defeat of this party was the fact that so much money so fast in limbo

that the public could not understand what was happening. In consequence

they said, "We do not know, we cannot see, and what we cannot see we do

not like," and they were turfed out at the election — and rightly so —

not for one mistake, not for two, but for the complete, total substance

of things that happened.

You heard on this floor of the $400,000 commission on the purchase

of Westcoast Transmission shares. You heard that said. I do not impugn

any irregular motive. Certainly somebody got $400,000, but the public

asks: "Who?" This will not happen again. There was no question who. The

auditor-general will say who. There will be no secret borrowings from

an Arab country. There will be no secret deals possible, because the

auditor-general will say, "who?" and the auditor-general will say who

gets the commission.

People still wonder and still ask to this day where these large

funds went. What happened? Why did we need secret deals? I do not

censure in any way — not at all. I merely make this remark in passing

because it is very important that it should be said, and should be said

clearly, that never again will this be possible when we have a man or a

woman as auditor-general of this province who will be able to say what

is wrong or what is right. No government will be changed because of

mistakes they have made in this area because everything will be open to

public view.

If there had been an auditor-general in the previous government we

would not have had the understatement or overstatement of revenue

expenditure.

Another important area is the shared costs with the federal government. The

point is: is the province paying more for its share? Are there areas where we

can get more sharing from federal government? That's a very important area.

We're not getting anything for nothing with the federal government, believe

me.

We're only asking for some of our money back.

Unless we are on our toes as government we will lose many millions.

But here we have an auditor-general who will guide us and be a watchdog

on what we do.

The auditor-general will be in charge of improper charges of

appropriations. I could attach each one of these to the loyal

opposition, but I refrain from doing so, because I do not think that we

are here to fight the last election, but we are here to say why we have

before us a good and proper bill. It must be told in this House. If not

here, where else?

The auditor-general will watch for costs incurred for work being

performed that should be on a formal contract basis. Contracts are let

without proper consideration of this Legislature or misdirection of

civil servants. He will see that all expenditures are made on proper

authority. You will say: "Well, why can't the House do this?" Well, the

House can and does, but it's political. I say again that the

auditor-general will be outside of the realm of politics and the people

will be able to rest easy and not ask embarrassing questions. What has

happened to the money floating in the air? And there's a lot of it.

Maybe it's not floating in the air, but who knows? That's the question,

and it must be told and told here.

The auditor-general will apprise the government and the public of

cost increases because of delays in construction and because of poor

planning. He will apprise the public of this. I could mention $10,000 a

day and all this sort of thing, but I refrain from this. I blame no

one, but I think. I am proud to say that this government has taken

initiative, and it was a strong initiative — yes, a very strong

initiative — to bring this man or woman into this area of control of

the public resource. It is a great step for British Columbia. I know we

are all proud of it — opposition and government alike.

I must stand here and say what I think, as all other members have

done, and I am amazed that hon. members opposite did not avail

themselves of the same opportunity. We have heard from them on every

occasion in opposition. It's not only for opposition to oppose, but

opposition has the duty to commend and approve, and this was their

opportunity, and I think they were found wanting when the chips were

down. You found a bill here that everyone in British Columbia wants,

and that party did not stand and say it is a great bill. I regret that

because we have lost the purpose of opposition and government.

I hope that never again will this House witness the abrogation of

responsibility of an opposition when they walk out of the House in a

body. I think it's most regrettable. For a cause, that could happen;

but in an instance where they were in agreement, but because they did

not want to hear us speak in praise of something of which we can be

justly proud....

One of the great losses to government is the civil service and the

government delaying contracts and awarding them too late for one reason

or another — sometimes political. This can never happen again because

the auditor-general will say: "Mr. Minister, it's costing this province

of British Columbia hundreds of thousands of dollars because they are

delaying. Tell us the reason why, because I will tell the public

tomorrow."

Can you see why it's important? Can you see why we must speak on it?

Hon. members, it is not that we want to praise ourselves, because

self-praise is very poor praise indeed. We must say to the people of

British Columbia that we have today come down with a bill that is

necessary, not because we fear public censure, not because we plan any

wrong-doing — never! — but because no government again will have

[ Page 2149 ]

the opportunity of going its own way, as was displayed by the previous three years.

Hon. members opposite know full well the reason they are sitting on that side

today. Never in the history of the province of British Columbia, except once,

was a government turfed out in one term of office. I think they should stand

up and say: "Well done, Social Credit. Well done! You have taken the responsibility

when others have failed."

You cannot overkill a matter of this kind. I heard it in the hall

yesterday: What are you doing it for? Because it must be told; because

the only place we can tell it is here. We have cases of accounts

incorrectly paid out and wrong appropriations. These things happen. I'm

sure it will happen when our bills are being examined. This can happen,

but this will not happen again.

I rise here in my place merely to say to hon. members how proud I am

to be a member of this government that would take the responsibility

and appoint such an office, and such a strong office. If you read the

bill, Mr. Speaker, you will see that we have given this person

overwhelming rights to supersede any facet of the public life of the

parliament in British Columbia. I'm proud of this as I take my place. I

hope that all members will feel the same way. I hope that we've said

almost enough on this, but if we have not, let any member speak who

wishes to do so. It's nice to hear.

MR. L.B. KAHL (Esquimalt): Mr. Speaker, I rise in my place

today to support Bill 45, the Auditor General Act. I'm very pleased, I

must say, that it was the Social Credit government who brought this Act

into being.

I want to mention a few things, a few reasons why I feel this Act is

necessary. On December 19, 1975, page 3 of the Times , the former Premier

of this province, Dave Barrett, when he was leaving office and leaving

millions of dollars debts behind, said: "The province doesn't need an

auditor-general." That's what he said — that they don't need an

auditor-general, which the Social Credit Party promised.

MR. J.R. CHABOT (Columbia River): He didn't want the people to know.

MR. KAHL: Well, if I were the ex-Premier and leaving the sad

financial state of this province behind, I can assure you I wouldn't

want an auditor-general either.

I'd like to draw the House's attention to another

article with which

many of the members are familiar, an

article in the Province, February

14, 1974. I would like to read it into the record of Hansard . It deals with the sunshine Act,

an Act that the previous Attorney-General always had a little bit of fun with.

His Act, it says, was patterned after legislation in a number of American States.

"The bill would have set standards for public

disclosures of a wide variety of government records and documents. 'Let

the sunshine in.' Mr. Macdonald would cry as he hurled his bill at the

forces of Social Credit darkness. But since he moved into the

Attorney-General's office and pulled down the shades, we have heard

nothing more about the much-promised era of open government."

MR. A.B. MACDONALD (Vancouver East): No more sunshine.

MR. KAHL:

"Nor has there been much said from the government

benches about another little innovation in accountability — an

auditor-general.

"It's quite remarkable that at a time when the

provincial government can toss around billions of the people's dollars

every year there is no public watchdog to try to ensure that the money

is well spent.

"Premier Barrett who was asked about this omission

during his budget press conference this week was not impressed. 'We

already have a comptroller-general, ' he said, playing dumb. 'Our

accounts are ready earlier than those of any other provincial

government in Canada', he added, playing even dumber.

"When Mr. Barrett was in opposition acting as the

conscience of the people, he knew the difference between a

comptroller-general, who is simply the government's chief accountant,

and an auditor-general, an independent man, charged specifically with

seeking out and reporting on government waste." And we have heard a lot

of government waste in this last while. "He knew, then, that without

such aid it is impossible for the opposition to know how wisely the

government funds are being spent. But now his memory has grown as short

as Mr. Macdonald's."

AN HON. MEMBER: What newspaper is this from?

MR. KAHL:

"Unless the two of them get together to rediscover some of their..."

AN HON. MEMBER: The same one you quote from all the time.

MR. KAHL:

"...opposition zeal this week's reform may

[ Page 2150 ]

turn out to be a sop rather than a first step toward real government

accountability."

From the Province on February 14, 1974, page 4. That's why we need

the Auditor General Act, Mr. Speaker. I am pleased that in

section 6

the auditor-general shall examine in such manner as he considers

necessary the accounts and records of the government relating to the

consolidated revenue funds and all public money.

This morning I spent some time again at the art vault.

AN HON. MEMBER: Oh, oh!

MR. KAHL: Public money — $900,000 — was spent. I can tell you that some of it was not spent wisely, as the public will indicate to us.

AN HON. MEMBER: Are you the judge?

MR. KAHL: An auditor-general would make that known.

MR. SKELLY: Will he have to be an art critic?

MR. KAHL: I want to tell this House that never have I set myself up as an art critic...

Interjection.

MR. KAHL: ...of the art that's there. All I simply asked for

was the fact that the public take a look at this art and see the price

that was paid for it. They have never ever had that statement available

to them — never. You can write to the Province of Alberta and ask for a

copy of their art pieces that they have purchased and the prices paid.

They will send it to you — no questions asked. Never before was that

done in this province.

AN HON. MEMBER: Never again.

MR. KAHL: There was $900,000 spent and not accountable to the

public. There are many artists who work very hard, and I take this

opportunity to commend them for the effort they put in this. The

auditor-general can scrutinize that type of wasteful spending.

Interjections.

MR. KAHL: No, I didn't see a 10-foot blank cheque, but I saw

some pictures that were blank. There was $4,500 spent on an 8-by-10

piece of so-called art with nothing on it except three or four little

pieces of tape. An inner tube — two pieces of pipe and two pieces of

wood — $750!

AN HON. MEMBER: Band-aid art!

MR. KAHL: It's available in the hardware store for $50.

AN HON. MEMBER: Or less.

MR. KAHL: That's the kind of thing that the auditor-general

will be able to watch over. It's the kind of thing that he will be able

to scrutinize and make recommendations to the provincial government.

I will move on to another couple of examples of spending of public

money. There was $300 a day paid to the chairman of the Motor Carrier

Commission, one Paul Sabatino who ran in 1972 in Point Grey against the

now hon. Minister of Education (Hon. Mr. McGeer). He ran for the NDP

in 1972.

AN HON. MEMBER: Political patronage! Political patronage!

MR. KAHL: He was paid $300 a day — $58,000 a year, hon. members.

AN HON. MEMBER: How much? How much a year?

MR. KAHL: Tell me. Bill Franklin, $300 a day...

SOME HON. MEMBERS: How much a year? How much?

MR. KAHL: ...one campaign manager for Dave Barrett...

SOME HON. MEMBERS: Oh, oh!

MR. KAHL: ...appointed as an assistant by order-in-council — $40,000 a year.

AN HON. MEMBER: Robert Bonner?

MR. KAHL: That's the kind of wasteful public spending that the auditor-general can take a closer look at.

Interjections.

MR. KAHL: B.C. Land magazine — the former member for Vancouver East, Bob Williams....

AN HON. MEMBER: Who's that?

Interjections.

MR. KAHL: There was $142,557 spent on B.C. Land magazine and that doesn't include the $33,611 that was paid out in postage.

[ Page 2151 ]

AN HON. MEMBER: Is that in your estimates?

MR. KAHL: Didn't you pay the bill? Do we have to include it in the estimates again? Didn't you guys pay any bills over there?

AN HON. MEMBER: We didn't pay that bill either.

MR. KAHL: I want to tell you that I sat on the public

accounts committee and for days we have talked about the wasteful

mismanagement and the spending of the previous administration. We often

hear the member for Vancouver Burrard (Mr. Levi) talk about the $103.5

million overrun that he had when he was Minister of Human Resources.

And he continually says: "It was spent on the people."

MR. N. LEVI (Vancouver-Burrard): It is.

MR. KAHL: Well, we don't disagree with that, Mr. Member. We hope it was spent on the people. We trust that it was....

AN HON. MEMBER: What else was it spent on?

[Mr. Schroeder in the chair.]

MR. KAHL: The fact is, Mr. Member, you couldn't account for it. You said it was a clerical error.

AN HON. MEMBER: Oh, no!

Interjections.

MR. KAHL: A clerical error. That is the kind of clerical error the public can do without.

The auditor-general can scrutinize those things and look over them.

The Premier of this province said the auditor-general would have a

field day. Let me tell you, he will have a field day looking over the

expenditures — the $541 million losses, the $181 million loss in ICBC

that there was an attempt to cover up. The auditor-general will have a

busy time, Mr. Speaker, a very busy time.

I'm pleased to say that I support this bill, and I know that it will get unanimous consent of this House.

MR. R.E. SKELLY (Alberni): I was admonished by the Member for

Dewdney (Mr. Mussallem) that everyone should take his place in this

debate, Mr. Speaker, and speak on this excellent piece of legislation.

I do agree that it is an excellent piece of legislation. I have checked

the financial administration Acts and the various Acts of the other

provinces of Canada, and I find that this is probably the best piece of

legislation covering this type of jurisdiction that's ever been

presented to any province in Canada.

AN HON. MEMBER: However.... [Laughter.]

MR. SKELLY: I regret that, as the government, we didn't present a similar piece of legislation.

HON. MR. MAIR: Why didn't you?

MR.SKELLY: ...but I am concerned....

Interjections.

MR. SKELLY: This is the "however": I am concerned for the

tone of the debate that took place beginning last night with the

disgusting presentation from the member for Columbia River (Mr. Chabot).

AN HON. MEMBER: Ah, but he wasn't himself.

MR. SKELLY: Possibly he wasn't himself last night. There was a two-and-a-half-hour break...

Interjections.

DEPUTY SPEAKER: Order, please.

MR.SKELLY: ...and people tend to forget what they were going to say before the break, Mr. Speaker.

DEPUTY SPEAKER: Order, please. Let me just assist the Member

for Alberni. The House is unusually busy. Could we drop the noise level

just a little?

MR. NICOLSON: On a point of order, is that mace properly secured? [Laughter.] If the debate gets out of hand I want to know, Mr. Speaker.

DEPUTY SPEAKER: The hon. member's referring to a news clipping I'm sure that he's seen. The Member for Alberni has the floor.

MR. SKELLY: Mr. Speaker, I do support this legislation. I

think it's a very good piece of legislation, as I said before. I've

read through most of the statutes in the other provinces of Canada, and

the Canadian statutes, and I think it's a very fine piece of work.

It's unfortunate that, as the second member for Victoria (Mr.

Barber) pointed out yesterday.... I don't think he was attempting to be

pious or unctuous in any way; I think he was just drawing the attention

of this House to the fact that over the past few months we've become

just far too polarized. The tone of the debate in the House has become

far too polarized...

[ Page 2152 ]

Interjections.

MR.SKELLY: ...especially on an issue that we all agree on. It's very unusual that this type of debate should take place.

The thing that was brought to our attention yesterday, as members of

the House, was that the reason for this bill is what took place over

the past 39 months, or the 39 months previous to December 11. In my

opinion, the Auditor General Act was needed over the past 23 years, and

I don't leave our three and a half years out of that by any means.

It is a unique piece of legislation. It's unique in the fact that

it's one of the few promises that the Social Credit government has

kept. They promised an anti-inflation freeze on taxes. We didn't get

that. They promised not to scuttle the Marguerite . They're in

the process of doing that. They promised a lot of things that they

haven't followed through on, and this piece of legislation is unique in

that they did bring it down. It's darned good legislation and, for that

reason, I support it. But if the members opposite would like to make it

retroactive, I think the powers of the auditor-general should be made

retroactive perhaps for the previous 23 years...

Interjections.

MR. SKELLY: ...to 1952. Let's go all the way back to 1952.

Some of the members have mentioned the purchase of Can-Cel shares

and implied, Mr. Speaker, that members of the government, at the time

that Can-Cel was purchased, took advantage of the fore-knowledge that

the government was acquiring Can-Cel in order to profit from that

transaction. I would welcome an auditor-general's review of that whole

situation to indicate, once and for all, that no member on this side of

the House and no member of the government at that time profited at all,

except as citizens of British Columbia. All profited from the

acquisition of Can-Cel; it was for the benefit of the whole province. I

think that if we are going to make the office and the powers of the

auditor-general in this province retroactive, then it should be made

retroactive to cover the acquisition of Can-Cel shares, to cover the

acquisition of that corporation and to clear up once and for all the

phony, cheap innuendo that was brought forward in this House by the

Minister of Health (Hon. Mr. McClelland) most recently. That member

thought the previous government did profit from the acquisition of the

Canadian Cellulose Corp.

It was also mentioned about the pension plans for B.C. Hydro — that

was mentioned by the member for North Okanagan (Mrs. Jordan) — and how

generous those pension plans were. Now we had an opportunity in the

public accounts committee to discuss certain issues with the general

manager and vice-president of the Bank of British Columbia.

DEPUTY SPEAKER: Order, please. May I just interrupt the hon.

member long enough to inform all members of the House that details of

matters discussed in special committee are not material to be discussed

on the floor of this House? As long as we are cognizant of that, we can

mention the fact that we did meet, but the details of those committee

meetings are not material for debate here. Please proceed.

MR. SKELLY: I was simply alluding to the fact that a meeting

took place between the Bank of British Columbia and the public accounts

committee — an historic meeting, Mr. Speaker, because ordinarily

private companies don't appear before the public accounts committee.

But in this case the province owns 10 per cent of the shares — or in

1974 owned 10 per cent of the shares — and we were very grateful that,

in this case, the company did appear before the public accounts

committee.

But the member for North Okanagan mentioned these generous pension

plans for B.C. Hydro, and the fact that executive officers of the B.C.

Hydro and Power Authority were given memberships in downtown clubs. I

think the Minister of Health mentioned the Vancouver Club.

HON. A-V. FRASER (Minister of Highways): Cass-Beggs.

MR. SKELLY: David Cass-Beggs, I think he referred to. I'd

like to ask what the policy was before 1972 — whether or not B.C. Hydro

purchased memberships in downtown clubs pre-1972 for people like W.C.

Mearns, who also happens to be on the Bank of B.C., for Gordon Shrum

and for a few others. It was the policy of B.C. Hydro before 1972 to

purchase memberships in downtown clubs and other privileges for the

directors of B.C. Hydro. It wasn't an NDP initiative, Mr. Speaker. It

had been done by B.C. Hydro for many years previous.

Interjection.

MR. SKELLY: No, no attack at all. It was brought up by the

Minister of Health. I don't know if the policy has changed. I imagine

Mr. Bonner, who's receiving $62,000 a year in pension funds from

MacMillan Bloedel — a major customer of B.C. Hydro, probably already

has those memberships in downtown clubs provided for him by MacMillan

Bloedel, and possibly by B.C. Hydro right now. It wasn't an NDP

initiative, but it is something that possibly an auditor-general should

look into: should the taxpayers be buying memberships in exclusive

[ Page 2153 ]

clubs through their hydro accounts? Mr. Speaker, I think that's a good thing for an auditor-general to look into.

The member for Dewdney (Mr. Mussallem) brought up the question of

secret loans from Arab countries. Well, last year, as the public

accounts committee reported — and it's a matter of public record now —

we found out about some secret loans that were made by B.C. Hydro when

they were acting as a bank for some people who have very close

connections with the Social Credit Party, including the former Social

Credit MLA for Kamloops who managed to profit from a loan from

B.C.Hydro in the construction of the Sandman Hotel in Kamloops. Not

everybody knew about the availability of those loans, Mr. Speaker. I

think the auditor-general should look into that policy.

It wasn't until the NDP took office and was able to acquire

information about the management of B.C. Hydro and the internal

workings of the executive management committee that we found out that

that committee was acting as a banking form for people with Social

Credit contacts, including the former Social Credit member for Kamloops

and his relatives.

Interjections.

MR. SKELLY: And a lot of other unsavoury characters as well.

SOME HON. MEMBERS: Oh, no! Come on!

MR. SKELLY: B.C. Hydro provided a list to the public accounts

committee. You could check through the minutes and you'll see the

connection, Mr. Member. Some of them were probably from your riding.

Interjections.

MR. SKELLY: Some of them are probably from your constituency

organization, in fact. There were also some things brought to light

concerning the circumstances around the awarding of contracts in

Columbia River Treaty dams. When tenders were called, people bid on

contracts, but the contracts weren't awarded. Hydro negotiated with

individual contractors and came up with a kind of coalition, similar to

the coalition we have now, in which there was some political influence

— a consortium of companies to build certain of the Columbia River

Treaty dams. When tenders were called, people bid on contracts, but the

contracts weren't awarded. Hydro negotiated with individual contractors

and came up with a kind of coalition, similar to the coalition we have

now, in which there was some political influence — a consortium of

companies to build certain of the Columbia River Treaty dams. I think

this is something the auditor-general might look into, even though it

was pre-1972 — before those thirty-nine and a half months in which the

NDP was in office.

We have a consistent principle on this side, Mr. Speaker — not a

flexible, elastic kind of principle that the members on that side seem

to have.

One member, the hon. Minister of the Environment (Hon. Mr. Nielsen),

talked about promises of funds that were made to a municipality or a

regional district. He felt that the auditor-general should look into

things like this and that the auditor-general would be able to prevent

politicians from making these types of promises. I don't think that's

possible, Mr. Speaker. We all make promises to people and to groups in

our ridings and we all hope to fulfil those promises. They're not

always possible within the constraints of budget, but we all do make

those promises between elections and during elections.

Perhaps we could look all the way back to 1956 when Dan Campbell

promised to complete the north island highway within a couple of years.

It's 1976 now, 20 years later, and that highway hasn't been completed,

although it was started under the NDP government. We could look at the

fact that the NDP had to keep a lot of Social Credit promises that were

as much as 20 years old. When the village of Qualicum Beach in my

riding expanded their boundaries, the department of Highways offered to

assist in the paving and developing of roads in Qualicum Beach. But

once the village was expanded and the boundaries were expanded, they

forgot about that promise and left that additional expense hanging, and

the village of Qualicum Beach is stuck with that expense.

The former MLA for Alberni, Dr. Howard McDiarmid, promised to build

a road up Mount Arrowsmith to a ski development that many of his

friends supported. It's a good ski development and I recommend it to

all members of the House who ski to go up there. It's a darn good

development. They benefited from community recreation facilities funds

provided by the NDP. That MLA promised to build a road up the mountain.

They said it would cost half a million dollars. The Highways department

said it would cost $1.5 million and a letter just went out from the

present Minister of Highways (Hon. Mr. Fraser) saying that there was no

possible way they could build a road up Mount Arrowsmith until access

had been provided to other municipalities in the province, and that's a

position that I wholeheartedly support. But in any case, the former MLA

for that riding, Dr. Howard McDiarmid, had promised to build that road

up there. Perhaps if the auditor-general is looking into politicians'

promises — and I don't suggest that that's an area he should be allowed

to look into — then he could look into some of those promises, not

simply the ones to Kootenay-Boundary

[ Page 2154 ]

Regional District.

The member for North Okanagan (Mrs. Jordan) also mentioned the

problems surrounding land acquisition for ICBC claims centres. We admit

that there were problems all over the province in acquiring land for

ICBC claims centres. Perhaps that's something the auditor-general could

look into as well. I don't think that this opposition would be

particularly embarrassed in the acquisition of any of those ICBC claims

centre sites.

I'd also like the auditor-general to look into some of the

transactions that took place in the exchange of land outside of parks

for timber rights and mineral rights within parks. Some of those are

pretty shady transactions. I can quote an example again from my riding,

Mr. Speaker, where a person who owned land in what is presently Pacific

Rim National Park exchanged that land for an equal value of timber

within Strathcona Park, for at that time the parks branch was starved

for funds for parkland acquisition, the same as they are now. They were

starved for funds and they were forced to exchange parklands for

additional lands of high recreational value outside the park. They were

forced to exchange timber and mineral rights inside parks for

additional lands of high recreational value outside parks. But they did

make a deal with the person who owned the land in Pacific Rim National

Park for land in the Bedwell River drainage inside the Strathcona Park

boundary.

It's interesting that an agreement was signed between the landowner

outside the park and the parks branch for the exchange of those timber

rights, but behind the closed doors of the minister's office — the

Minister of Lands, Forests and Water Resources at the time under the

previous Social Credit government — the timber rights were increased to

three times the area behind the closed doors of the minister's office.

When I went up to the parks branch and asked to look at the files —

and the question of files has been brought up several times in this

House — I said to him: "There's not much information on this file about

that increase in the timber rights that this person has acquired in

Strathcona Park — a 300 per cent increase. Has the file been tampered

with in any way after the change of the government in 1972?" He said: "I

won't say it has and I wan't say it hasn't." But maybe that's something

the auditor-general could look into, Mr. Speaker.

MR. LAUK: At least my files are all together.

MR. SKELLY: Not only the land transactions between people

with close Social Credit connections and the parks branch behind the

closed doors of ministers' offices under the previous Social Credit

government, but also the fact that files were tampered with between the

time the government was defeated in 1972 and the time the new

government took office in September of 1972.

MR. CHABOT: They weren't stolen.

MR. LAUK: Oh, shut up.

MR. SKELLY: If files are stolen, you take somebody to court, Mr. Member.

DEPUTY SPEAKER: Order, please!

MR. SKELLY: And if we're dealing with the past...

AN HON. MEMBER: Withdraw.

MR. SKELLY: ...and if the auditor-general should have

retroactive powers that some of the members on the opposite side of the

House suggest, perhaps they should look into the Commonwealth Trust

situation. The Minister of Health brought up the question of the

government purchasing shares in B.C. Tel and the government's strategy

to drive down the value of shares. I have people in my riding who are

still writing to me saying that they purchased Commonwealth Trust

securities on the recommendation of a former Social Credit MLA for

Victoria. A former Social Credit MLA for Victoria recommended that they

purchase these Commonwealth Trust shares.

By the way, that land transaction in Strathcona Park was also

financed by Commonwealth Trust, Mr. Speaker. But these constituents are

still writing me about Commonwealth Trust and the fact that the

purchase was recommended by the former Social Credit MLA for Victoria;

and these people received a return on their investment, after

Commonwealth Trust went bankrupt, of 8 cents on the dollar. These

people are old-age pensioners — and he talks about old-age pensioners

owning B.C. Tel.

We all know who the major shareholder of B.C. Tel is. It's

Anglo-Canadian Telephone, owned by General Telephone and Electronics,

one of the largest companies in the world. It's 51 per cent controlled

by that company, and we have a minor, very minor, interest in B.C.

Telephone.

It's been proven, Mr. Speaker, that most of the people who own

shares in B.C. Tel aren't the widows and the orphans and the

handicapped of this province. They're the rich people that those on the

other side represent. But the people who purchased Commonwealth Trust

shares, on the recommendation of a former Social Credit MLA for

Victoria, what did they get on their investment? After Commonwealth

Trust went bankrupt, 8 cents on the dollar, and if we want to talk

about coverups, let's have the auditor-general go right back and look

at the coverup of the Commonwealth Trust scandal by the former

[ Page 2155 ]

Social Credit government.

Those people on the other side of the House are concerned when we

bring up the case of Robert Sommers, and I'm concerned too, because

he's a constituent of mine, Mr. Speaker. I don't think that you should

drag the name of Robert Sommers through the mud. No, we don't see eye

to eye politically, but I think that once a person has been convicted

and served a term in jail, the only minister of the Crown and the

Commonwealth to do so, you should clean your record and that's it.

But we're not talking about Robert Sommers personally. We're talking

about the Sommers case in particular and the coverup of the Sommers

case by the Attorney-General of that time. We don't know who else

received bribes in the Sommers scandal, and, again, I'm not referring

to Robert Sommers personally but to other people around him who could

possibly have received bribes. Because that case wasn't followed up, in

spite of the fact that the judiciary of this province wanted to follow

it through. But that government kept a lid on it, and the

Attorney-General of the time covered it up and kept the lid on it. The

Attorney-General is now an employee of this government.

MR. CHABOT: Dish it out, but you can't take it. Bunch of cowards.

MR. SKELLY: Oh, listen to the chirping now.

DEPUTY SPEAKER: Order, please! The member for Alberni has the floor.

MR. SKELLY: And, also, Mr. Speaker, the fact that the forest

management licences issued as a consequence of that minister of the

Crown receiving bribes under the previous Social Credit government —

and it was a long time ago — are still in existence and still held by

the companies that bribed that minister.... In fact, because of

increases in the inventory of timber and those tree farm licences, and

the change to a close utilization policy, for their original investment

in bribery they got a heck of a lot more timber now than they got back

in 1954. Those forest management licences still exist.

So if we're going to have the auditor-general do a retroactive

examination of the accounts of the previous government during the 39

months before the Social Credit took office — or the coalition

government took office; I don't really care what you call them — then I

think we should go back to scandals like that Robert Sommers case,

because those scandals are still having an impact on this province,

because the companies that profited from bribery in those cases are

still profiting from bribery in those cases. I think that that type of

case deserves the examination of the auditor-general.

Last night, the member for Columbia River made an absolute

misrepresentation on the question of payment of brokerage fees for the

acquisition of shares in Westcoast Transmission from El Paso Natural

Gas. He backed off a little bit, Mr. Speaker. He had to back off

because he wasn't sure of his facts. He thought he was before he went

out for supper for two and a half hours, but when he came back he

wasn't so sure.

He said that we paid Wisener and Partners over $400,000 in brokerage

fees, until somebody on this side of the House pointed out to him that

it didn't appear in the public accounts, and that El Paso, in fact,

paid the brokerage fees to Wisener and Partners. If you will read the

question....

MR. CHABOT: That's not true!

DEPUTY SPEAKER: Order, please.

MR. SKELLY: If you'll read the question before you go to supper rather than after you come back, you'll clear up the situation.

MR. CHABOT: You're a phony!

DEPUTY SPEAKER: Order, please. Hon. Member, may I interrupt

you just long enough to remind you to please direct your remarks to the

Chair? It will assist us in keeping order in the House.

MR. SKELLY: Mr. Speaker, that member called me a phony, and I ask him to withdraw that.

DEPUTY SPEAKER: Would the hon. member for Columbia River please withdraw the remark "phony," as attributed to the member now speaking?

MR. CHABOT: Mr. Speaker, the remark "phony," attributed to

me by that member.... I didn't really want to call him a phony, but

he's making some very phony remarks.

DEPUTY SPEAKER: But you will withdraw any "phony" as attributed to the member himself, won't you?

MR. CHABOT: Yes. Mr. Speaker, if he infers that I'm

suggesting that he is a phony, I didn't say that. If I did, I withdraw

it. But he is making very phony remarks.

DEPUTY SPEAKER: Thank you for withdrawing, Mr. Member.

MR. SKELLY: I'm referring to some phony remarks made by the member in his disgusting presentation last night after the supper break, Mr.

[ Page 2156 ]

Speaker. The question on that order paper asked what brokerage fees

were paid; it didn't say who paid them, by whom were they paid or to

whom were they paid.

AN HON. MEMBER: Are you suggesting that the government didn't pay any brokerage fees?

MR. CHABOT: You don't know what you are talking about.

MR. SKELLY: I'm suggesting that you didn't know what you were

talking about. You had to back off yourself last night because you

didn't have the facts at hand.

DEPUTY SPEAKER: Order, please.

Interjections.

MR. SKELLY: I didn't say he paid it, Mr. Member.

Interjections.

[Deputy Speaker rises.]

DEPUTY SPEAKER: I remind the hon. member for Alberni for the

second time: please direct your remarks to the Chair, because it is in

this way that we can maintain order in the House. If you fail to do so,

then we'll have to take other steps.

[Deputy Speaker resumes his seat. ]

MR. SKELLY: Thank you, Mr. Speaker, I will direct my remarks to the Chair.

But in any case, that member who yesterday set the disgusting tone

for this debate is the reason, I think, why members on this side of the

House — who support the Auditor General Act, feel it is a very fine

Act, and we're very grateful for the detailed presentation made by the

Minister of Finance in presenting the Act, and we are 100 per cent

willing to support it — walked out of this House in disgust with the

content and the nature of the debate made by that member, and the tone

for debate set by that member last night.

There is some confusion in the debate surrounding the

auditor-general in that some members on the other side of the House

feel that he is going to prevent the government from making mistakes by

controlling what the government does. I think this is not true at all.

If that was the case, we could have used him only five months ago and

we wouldn't have had some of the problems we are facing as a result of

the coalition policy over the past five months.

No, the government, as they admit themselves, are going to make

mistakes over the next three or four years. The auditor-general is

going to call their attention to those mistakes, they are going to be

embarrassed by them and we're going to use that fact to attempt to

embarrass the government.

Certainly the auditor-general's reports are going t