February 26, 2003 Alberta Hansard 139 Legislative Assembly of Alberta Title: Wednesday, February 26, 2003 1:30 p.m. Date: 03/02/26 [The Speaker in the chair] head: Prayers The Speaker: Good afternoon. Let us pray. Our Father, we confidently ask for Your strength and encouragement in our service of You through our service of others. We ask for Your gift of wisdom to guide us in making good laws and good decisions for the present and the future of Alberta. Amen. Please be seated. head: Introduction of G uests The Speaker: The hon. Minister of Human Resources and Employ- ment. Mr. Dunford: Yes. Mr.

Speaker, we have a number of staff that are here with us today, all involved in the orientation, and I would ask each of them, as I call their names, if they would stand and remain standing. Then we can get a good look at some great employees. I’ll begin with Jacqueline Wallis, Mauricio Telleria, Leslie Wei, Tracy Gould, John Mitchell , D onna Bruce, C indy Ost apovich, Don Tymchuk, Val Jans, and Kevin Inkster. What a fine-looking group. Please welcome them. The Speaker: The hon. Minister of Municipal Affairs. Mr. Boutilier: Thank you very much, Mr. Speaker.

It’s my pleasure today to introduce a very good friend and his daughter. He actually lives in the second largest city outside of Newfoundland, and that’s Fort McMurray. Brian Hatfield hails from Placentia, Newfoundland, and is here today. His daughter attends Father Mercredi high school, where she was recognized as one o f the top female athletes in her grade 12 class. I’d like to ask both Brian and Ja net to rise and receive the very warm welcome of the Assembly. The Speaker: The hon. Member for Redwater. Mr. Broda: Thank you, Mr. Speaker.

I’m pleased to rise today to introduce to you and through you to the members of the Assembly 19 bright and energetic grades 5 and 6 students from the Waskatenau school. These students deserve the best education possible, and I hope that the Aspen View school division makes the right decision in the future of their school. They are seated in the members’ gallery and are accompanied by their teacher, Miss Audrey Toews; parent helpers Mrs. Cathy Schesnuk, Mrs. P eggy Zatorski, Mrs. Donna Barrow, Mrs. Sophie Rogoza , Mrs. Kim Ness, Mr s. Linda Dombowsky, Mrs. Becky Mulak, Mr. Zen Gurba.

I would ask them to please rise and receive the warm welcome of this Assembly. The Speaker: The hon. Member for Edmonton-Manning. Mr. Vandermeer: Thank you, Mr. Speaker. Today I am pleased to introduce to you and through you to all members of this Assembly 16 young people from the Take a Break seniors community group. The seniors in Take a Break like to be kept inf ormed about their provincial government and the programs that we offer. They meet twice a month and invite speakers from government and the business community to keep the m informed about the programs which a re specifically for them.

I know that the Member for Edm onton- Beverly-Clareview has met with them, and last year in October I had the pleasure of meeting with them. The group has come to watch today’s proceedings and also to tour the Legislature. I will read their names, and perhaps if they are able to, they could stand as I read their names: Di ck and Lo ttie Cook, Mitch Dombrosk y, Bet ty Krol, Martin and C lara Wi tten, Gerda Debbink, John and M ae Vlieg, Jo N iemantsverdriet, Berend and Gerry Witteveen, Henny Witten, Ann Helder, and Jo hn an d Ruby Denning. Could we please give them the traditional warm welcome of this Assembly.

The Speaker: The hon. Member for Edmonton-Mill Woods. Dr. Massey: Thank you, Mr. Sp eaker. It’s w ith pleasure that I introduce to you and through you to members of the Assembly 41 English as a Sec ond Langua ge student s from NorQue st Coll ege. They’re in t he p ublic ga llery, a nd t hey’re accom panied by their leaders Mrs. Moniz, Mrs. B ergman, Mrs. Wa lker, Ms Fryzk, Ms Apedaile. I’d ask them to please stand and to receive the traditional warm welcome of the Assembly. The Speaker: The hon. Member for Edmonton-Strathcona. Dr. Pannu : Thank y ou, Mr. Speak er.

I ris e with c onsiderable pleasure to introduce to you and through you to the Assembly a very hardworking Edmontonian who’s seated in the public gallery. His current MLA is the Ministe r of Econom ic Development, and the visitor is planning to take that seat away from the minister in the next election. I’m talking about Mr. Lorne Dach, who’s vice-chairman of the city of Edmonton nonprofit housing corporation. He’s also the recently nominate d New D emocrat candidate in the Edm onton- McClung constituency.

I would ask him to now rise and receive the warm welcome of the Assembly, including his MLA. head: Oral Quest ion Peri od Natural Gas Rebates Dr. Nicol: Given that a portion of the $1.8 billion surplus announced today is due to the increased royalty revenues from the high price of natural gas, will the Premier give Albertans the natural gas rebates he promised prior to his election? Mr. Klein: Mr. Speaker, the law is quite clear relative to rebates. As the hon. leader of the Liberal Party knows, when the average annual price reaches $5.50 a gigajoule, then the rebate program will kick in. Mr.

Speaker, I find it very, very interesting that the Liberals would be talking about a rebate at this particular time. This is a much different tune than they were singing when the legislation wa s introduced. The hon. Me mber for – and I f orget his const ituency, but he’s sitting at the end – Edmonton-Gold Bar, you know, when we were debatin g the bill, sai d: “This c ould wind up cos ting us billions of dollars. What criteria will determine who gets a rebate? . . . Albertans are going [to have] to pay for this . . . We have to be very, very careful here.” Well, Mr .

Speaker , first of all, we were very, very caref ul in establishing the guidelines. As a matter of fact, we took the words of the hon. leader of the Liberal Party to heart when we drafted the legislation, because the hon. leader of the Liberal Party said: We have to make sure that [the] price level we’re going to protect is contingent upon and tied to the p rice we us e in the budgeting process for revenue generation and revenue estimation within the province . . . If we go ahead and estimate the pr ice of natural gas for our budgeting process at $7 [a gigajoule], let’s just say, and we

140 Alberta Hansard February 26, 2003 want to start protecting the price at $5 [a gigajoule], what we’ve got is a $2 marg in there that w e basically either have to put into our budget to debate the dollars that are necessary to cover the differ- ence between what we’re expecting out of revenues . . . Otherwise we’ll end up running a deficit budget, and in Alberta we don’t want to do that. Dr. Nicol: Mr. Speaker, I stand by those comments today.

The government didn’t have an annual average when it pulled the trigger to issue rebates in 2001, so why did the Premier consider it an emergency then, an election year, but it’s not an emergency now when people are cold and needing that support? 1:40 Mr. Klein: Mr. Speaker, natural gas at that particular period of time was about $5.76 a gigajoule on average. It had been, on average, for over six months, I believe. Election or no election, we had to take action, but it wa s ad hoc ac tion. We to ok the adv ice of t he hon. leader of the Liberal Party, and we put in a program that would be sustainable.

Now , instead of talking about sustai nability and programs that are responsible, the y’re talking about: well, go back to ad hoc-ism. You know, there was a wonderful quote that I heard today from the hon. Member for Edmonton-Rutherford. He said that today’s benefit will be perceived as to morrow’s entitlement. We want to make sure that whatever entitlement is there is there through law and is there on a sustainable basis, and that’s why we have the legislation we have today in place. Dr.

Nicol: How does the Premier explain his comments in 2001 when he said : Alberta’s natural gas bel ongs to all Albertans, and they have told our government that in times of high prices such as we’re seeing this winter, the revenues from gas should be returned to them. Mr. Klein: Absolutely true, Mr. Speaker, and that’s why we put in place legislation that says to Albertans that once, on average, natural gas prices reach $5.50 a gigagoule, then there will be rebates. That is performing on a sustainable basis rather than on an ad hoc basis.

Certainly, the situat ion in 2000-2001 prom pted us to bring in legislation to ensure Albertans that there would be protection in the future rather than doing it on an ad hoc basis, as the Liberals would like us to do. Natural Gas Prices Dr. Nicol: Yesterday the Premi er stated, “Thousands upon thou- sands upon thousands of Albertans can afford to p ay their [natural gas] bills.” However, the Official Opposition has tabled over 2,000 signatures from Albertans who cannot afford to pay their natural gas bills.

The mayors of our largest cities are also demanding rebates on behalf of their constituents who can’t afford to pay their bills. To the Premier: given that the Premier asked to be informed of any Albertan who is freezing in the dark, will the Premier help this Edmontonian who wrot e to us on our we b site, alt aliberals.ab.ca, to s ay: it is proven that people are having their g as shut of f, and I’m getting threats already to getting my gas shut off; can I get help? Mr. Klein: Well, Mr.

S peaker, if th at person is in a l ow-income bracket and is entitled to certain government benefits, then I would ask him to contact the appropriate authorities – not the Liberals but the appropriate authorities within government – to see if there’s any way we can rectify the situation. What I said in the Legislature was relative to a comment that was made by the hon. Mem ber for Edmonton-Highlands, who talked about people freezing in the dark, and I said: give me some examples. Otherwise, it’s not true. If that is happening or if it’s abou t to h appen, we want to know, and we want to know the circumstances.

We’ll work with the family or the individual involved to make sure that they don’t freeze in the dark. No one freezes in the dark in this province. Dr. Nicol: To the Minister of Seniors: why do seniors have to wait until they are threatened with a disconnection notice before they’re able to access any of your ministry’s onetime assistance programs? Mr. Woloshyn: Mr. Speaker, that statement is totally incorrect. The onetime support, the special-needs program, is not directed at utility costs per se, as I indicated in the House.

It is directed at onetime, exceptional, unexpected expenses, whether they be repairs t o the home – although we don’t have a home repair program – whether they be dental work, whether they be stuck for eyeglasses, based on their ability to pay. So it’s directed towards the needy. This year, I do believe, we’ve helped somewhere in the neighbour- hood of about 9,000 pe ople, although I will have to research that number to get you an accurate one. So to say that I am waiting for them to get disconnect notices to pay their bills is totally misleading.

I would stand behind that program one hundred percent because it is a very, very good program. It is the only program of its kind in the country, and it is directed at the people who need the assistance the most. I would a ppreciate it if th e hon. Leade r of the O pposition would get his research done properly before he poses a question of that nature, because I don’t want the people for which I’m responsi- ble to become unduly concerned over irrational statements of that nature. Dr.

Nicol: To the minister of human resources: given that the price of natural g as has jus t increased for the third m onth in a row and AISH recipients may only apply for onetime emergency assistance through SFI when t hey have a shut-off notice, what help does the government have for the AISH recipient who is faced with a second disconnect notice? The Speaker: The hon. Minister of Human Resources and Employ- ment. Mr. Dunford: Thank you. Than k you for the question, because it allows me, the n, to expand on what we talked about yesterday in terms of d isconnect notices.

Whil e it is true what the opposition leader has indicated about onetime help for AISH, we can make the announcement here today, because I think every one here in t he House is familiar with this or at least should be, that when an AISH client runs into difficulty, we do have the opportunity to move them from the AISH program onto our supports for independence program and then see what kind of assistance we can provide at that time. So we don’t want anybody thinking that just bec ause they’ve been labeled and they have some kind of entitlement, they’re stuck there.

If there’s a need, we try to find a way as best we can, Mr. Speaker, to try to deal with it. The Speaker: Third Official Opposition main quest ion. The hon. Member for Edmonton Mill-Woods. Foster Care Dr. Massey: Thank you, Mr. Speaker. People who are bad parents have their childr en taken from them by the government, but as a growing number of cases show, the governm ent can also be a bad parent. My first question is to the Premier. When the government is a bad parent, who is expected to protect children?

February 26, 2003 Alberta Hansard 141 *See p. 188, right col., para. 9, line 4 Mr. Kle in: Mr. Speaker, the way that questi on was pos ed is subjective, to say the le ast, because government is a h uge entity. You know, there are all of the Members of the Legislative Assembly. Then there are the government members of the Assembly. There are the members of the Official Opposition; although not members of the government, they’re still associated. Then the re are 20 s ome odd thousand employees of the government.

So what component or what individual or what segment of the g overnment is the hon. member talking about? Who in the gove rnment or what body within t he government is perceived to be a bad parent? Is he talking about me? Is he talking about the Minister of Finance? Is he talking about the Minister of Children’s Services? As far as I know, they’re all very good parents. All of those who have children are very good parents. So who is he talking about? Be specific. Name a name. Name an organization. Name a body. The Speaker: The hon. member. Dr. Massey: Thank you.

The Children’s A dvocate documents hundreds of them each year, Mr. Premier. My second question is to the Minist er of Ch ildren’s Services. What recourse is there for adults who as children were abused while in government care? Ms Evans : Mr.

Speak er, if t he reference point is the alleged situation that was identified in the statement of claim yesterday and the situ ation all uded to by th e hon . me mber opposite r elates t o people who have memories of mistreatment, we are hoping that with the process we have in place today, that I identified yesterday, albeit briefly, we will avoid having people who have these k inds of recollections and that nobody intervened.

Current ly, today, with CWIS, which accesses the child welfare files, we have the capacity for the advocate to act impartially and on behal f of that person the very first i nstance the re’s any tra nsgression by anybody. That appears on the file. So if a foster parent abuses a child, it is noted there, and the advocate can immediately intervene. If, in fact, it’s a reference point to what used to be or what used to happen in the past, then obviously in many of those situations those people come back and make their representation through the courts or through some other filing. But, Mr.

Speaker, today I think that we are very current with our information and very current, indeed, with our follow-through on behalf of those that claim some abuse at the hands of so mebody emp loyed by government or deploy ed by government to look after children. 1:50 The Speaker: The hon. member. Dr. Massey: Thank you, Mr. Speaker. Again to the same minister: why force those people to go to the courts? Why won’t the minister establish an independent panel to investigate and provide compensa- tion when the government has proven to be a bad parent? Ms Evans: Well, Mr.

Speaker, allegations, of their own accord, do not constitute proof . We have still got the situation with the John Doe case that has not bee n adjudicated by the courts. The courts have not come back and g iven us any recom mendation. We’re clearly waiting for that. We’ve got in place something that works for the here and now. If people today as adults have some difficulty that they want to raise, they can certainly approach this government, the Minister of Children’s Services, the Minister of Justice. They file those complaints and bring them forward. Should there be a necessity to bring forward another panel?

I’m not sure. I w ill tell y ou this . They coul d clearly write t o this minister – and frequently they do – and we will try and investigate whether or not there’s something. But I don’t get a lot of complaints from people who allege abuse from times past. Usually, if they come forward and write, it’s because they may be unsatisfied with the legal representation they’ve had in bringing that matter forward. So, Mr. Speaker, this external panel review process is not necessary. Could I identify one more thing?

W e have the Child Welfare Appeal Panel, that curr ently works except ionally well fo r thos e people that are unsatisfied today, and last y ear we had over 230 representations made to that panel. Administrative review solved all but 35 of those. The Speaker: The hon. Member for Edmonton-Highlands. Natural Gas Prices (continued) Mr. Mason: Thank you very much, Mr. Speaker. As the provincial government turns a deaf ear to its citizens, Albertans are wondering why they have to pay heating bil ls that h ave spiked 60 percent or more this year.

Now, some Albertans are a bit luckier, particularly those that live in the city of Medicine Hat, which owns its own gas utility and has show n that ga s rates can be se t at ver y reasonable rates right here in Alberta. While ATCO customers are paying over $8.50 a gigajoule, Medicine Hat residents pay a rate o f $2.25 a gigajoule. To the Minister of Energy: why is it that the citizens of Medicine Ha t get a br eak on the ir home he ating cos ts, but this government, which has just a nnounced a $2.7 billion unb udgeted resource windfall, tells Albertans to forget it? Mr. Smith: You know, Mr.

Speaker, if I were to believe in reincar- nation, I would come back as a New Democratic politician. I could still stay in the Legislature, and a ll I have to do is drop reason and accountability. The city of Medicine Hat owns its own gas. The city of Medicine Hat does not pay royalties to the province of Alberta.* This has long been a city that’s had gas used to ligh t streetlamps. Medicine Hat has two wonderful members representing it here in the Legislature today, Mr. Speaker, and in fact they have gone about their business in a cordial way with the province and in an eff ective way for th e city.

The Speaker: The hon. member. Mr. Mason: Thanks very much, Mr. Speaker. Now, how is it that the government can justify c ollecting over $6 billion in resource revenue, but it can’t afford to pay 5 percent of that for natural gas rebates? I ask that to the minister. Mr. Smith: Mr. Speaker, in the year 2001, when natural gas prices grew – in fact, the government of the day addressed this issue – we came up with the Natural Gas Pric e Protection Act. We str uck a price in which Albertans could qualif y for assistance at 5 pe rcent below the price in 2001.

So discounti ng inflation, discounting the increase in prices, we are still at a strike price that’s 5 percent below 2001 levels. It was announced that way. It was announced in a 28th of August news release: the forecasted annual reference price in the year’s fiscal provincial budget is the way that we ’ll establish the price; the trigger price has been established at $5.50. We are being more than fair.

We’re being realistic of the issues of the day, and we’re here to provide Albertans assistance with the rebate program as the prices get to the point where it was forecasted and put int o law, which these members debated and these members participated in in the session of 2001.

142 Alberta Hansard February 26, 2003 The Speaker: The hon. member. Mr. Mason: Thank you very much, Mr. Speaker. Well, given that the minister thinks that 5 percent below the prices that existed before the last election is good enough, then can he please tell us why, if the government is getting $6 billion a year from resource revenues, most of which is natural gas, the go vernment isn’t actively participating in the gouging of homeowners in this province on the price of their natural gas right now? Mr. Smith: Well, Mr.

Speaker, there’s no New Democrat alive that wouldn’t put $27 billion worth of demands into a $20 billion budget. An Hon. Member: Yes, they would. Mr. Smith: Yes, they would, and I guess that’s what they’re asking to do right now. So, Mr.

Speaker, in fact, over $20 billion worth of royalties that have been collected over the last fou r years have gone in to things like health care – and I’m sure the minister may want to talk about the changed budget in health care from 2001 – education, infrastruc- ture, drought relief, forest fire assistance, not to discount the fact that there’s been som e 1.3 billion dolla rs in tax cuts delivered to this province since the year 2001. The Speaker: The hon. Member for Whitecourt-Ste. Anne, followed by the hon. Member for Edmonton-Riverview. Mr. VanderBurg: Thank you, Mr. Speaker.

Many of the constitu- ents in Whitecourt-Ste. Anne are calling my offices regarding utility concerns. The m inister just talked a bout trigger pricing a nd this regulation regarding the av erage prices. It ’s difficult to ex plain. How does th e min ister calculate this average price, and how is a $5.50 gigajoule trigger price calculated? Mr. Smit h: Well, Mr. Speaker , I app reciate the question. The Alberta reference price is the averag e selling price o f all A lberta natural gas sold throughout North America less their transportation cost in a given month. Yes, it is difficu lt. First , you have a well.

People take ri sks. They drill a well. They find na tural g as. The natural gas is then produc ed, and it g ets up into a device called a separator or a treater. It takes water out of it . It adds v alue to the gas. It puts it into shape to put into a pipeline. Then it’s moved to a gas plant, and then its carbon dioxide is removed. If it’s enriched, other ethane enrichments are removed for later sale.

Then that gas is piped throughout the system down to Empress at the AECO gate, and then it’s moved all across North America, where, in fact, if it was put into electricity, it would light up one out of every seven and a half homes in the United States. Now, this price that has been paid is paid when it hits the gate price, and it is reduced of the transportation cost, and then if you’re in that well, there are a number of partners in that well, so then the money is split amongst those par tners. So, Mr.

Speaker, what happens is the reference price is the price that we sell the gas at, and there’s a lag of some 30 to 45 days, in some cases 60, before we can calculate that price and the pay ments t hat have accrued t o the Crown. 2:00 Mr. Vand erBurg: Well, ag ain to the sa me m inister. A s you explained, you know, the trigger price is difficult to understand, and we have that trigger price calculated on the fiscal year average. Why not calculate that quarterly or seasonally then? An Hon. Member: Good question. Mr. Smith: Mr. Speaker, that is a good question, as one member has just said.

In fact – and I think this bears some examination – why couldn’t we look at calculating it maybe twice a year when we see prices change? For example, in August of 2002 the price of natural gas was $1.84. An Hon. Member: How much? Mr. Smit h: One dollar a nd eighty -four ce nts, Mr. Speak er. In November the price was moving up to that $4 level. So, in fact, that is a reasona ble suggestion. One thing we will not be able to do, though, is put two Januaries or two Fe bruaries i nto a 12-m onth period. Mr.

VanderBurg: Again to the same minister: you know, due to the fact that competition and customer choice is a real answer to many of my constituents’ concerns, will my constituents and will Albertans be better served by Direct Energy coming into Alberta to get into the retail marketplace? Mr. Smith: Well, Mr. Speaker, I think that again the member has hit on the key. Competition, increased supply ar e certa inly ke y in electricity.

The ability for Albertans to choose whether they’d like to integrate gas and electricity prices, to buy on a 12- , 24-, or 36- month basis are all options that they will have at their disposal as the Gas Utilities Act com es forw ard to the L egislature. In f act, as Albertans make choices, there w ill still b e a Natural Gas Price Protection Act, tha t will ba sed on good inf ormation, in-depth analyses.

There are over 55 0 people in the Dep artment of Energy that are ex perts in this business, t hat work hard and that will continue to deliver clear information on trigger price, forecast price, annual rates of calculation. It is a complex business, but we’re going to work hard to make sure every Albertan can understand and benefit from this resource. The Speaker: The hon. Member for Edmonton-Riverview, followed by the hon. Member for Calgary-Shaw. Electronic Health Records Dr. Taft: Thank you, Mr. Speaker.

Proposed changes to the Health Information Act w ill allow confidential patient information to be posted on computers without the consent of patients. Their consent will automatically be assumed, a s if it were a negative b illing. To the Minister of Health and Wellness: if consent for electronic sharing of records was important in 1999, when the Health Information Act was passed, why is it of so little importance today? Mr. Mar: Well, Mr.

Speaker, I first have to speak to the importance of electronic health records and circumstances as to why this is an important thing to do for the purposes of patient safety and better outcomes in our h ealth care system.

If an indivi dual who’s a resident of Edmonton is injured in a car accident in Pincher Creek, Alberta, the emergency team that sees that person at the accident site should be able to by wireless communications access that portion of the individual’s record tha t relates to the f act of w hat their blood type is, whether they’re diabetic, whether they’re on certain kinds of medications, whether they’re allergic to certain kinds of things, and therefore the treatment would be governed accordingly. The consent in such a circumstance, obviously, if the individual is unconscious would not be possible.

Now, this is an example of why electronic health records are important. Another example for the purposes of eff iciency is that, say, an

February 26, 2003 Alberta Hansard 143 individual sees a physician and ge ts a diagnostic test. Another specialist that the individual has b een referred to should be able to access the lab values and the diagnostic tests without having to order them again, so this is for the purposes of efficiency. Now, Mr. Speaker, it is in the best estimation of the people that we rely on, our physicians, our health care providers, that this kind of information is valuable to have. Let me speak to the specific issue of patient consent. We have run a pilot project on the pharmacy information network.

Some 4,200 people in Leduc a nd Westlock were participants in this particular information-sharing project. We asked for their consent, and out of 4,200 people only about 30-some did not consent to having t heir information put in the format of an electronic health record. So over 99 percent of people consented when it was explained to them what the value of this was. So, Mr.

Speaker, it’s not that individuals cannot refuse consent – they still can – but the onus now shifts from the health care provider to ask for their co nsent to the indiv idual patient, who still has the right to say: I do not conse nt to have t his information on an elec- tronic health record. They can still do that. The Speaker: The hon. member. Dr. Taft: Thank you, Mr. Speaker. A pilot project and focus groups are one thing; a full-blown public consult ation process is another. Why did the minister not hold public meetings and provide public information sessions on these proposed changes? Mr.

Mar: This is a very important piece to help drive effectiveness and efficiency and, particularly, better patient outcomes in our health care system. That’s the reason why we’re moving forward on it, Mr. Speaker, and we think that from our exam ple, from this very, very important pilot pro ject – ag ain, when Albertans are ex plained the reasons why an electronic health rec ord is important, overwhelm- ingly they would consent to this idea. Dr. Taft: The reason given by the government in writing is that it was an administrative burden.

Given that many government information systems are contracted out and that there have been any number of thefts of equipment and software, will the minister admit that there are real risks of massive breaches of conf identiality with thes e systems i f, for example, a computer is stolen? Mr. Mar: Mr. Speake r, it is v ery c lear that Albe rtans do have concerns about inappropriate use of their health information. That is corre ct.

Ho wever, the sta keholders that we worke d with – physicians, health care policy analysts, health care providers of all sorts – recogniz e the im portance of the confi dentiality of this information, and I wish to assure this House and Albertans that every reasonable effort will be made to ensure the protection of confiden- tial patient information. That is absolutely critical. The Speaker: The hon. Member for Calgary-Shaw, followed by the hon. Member for Edmonton-Ellerslie. Calgary Board of Education Mrs. Ady: Thank you, M r. Speaker.

As the Member for Calgary- Shaw I have over 25,000 constituents that are bet ween the ages of kindergarten and grade 12, so learni ng and educa tional issues are always of great importance to me and my constituency. In a third- quarter announcement today it indicated that the Ca lgary board of education will be receiving a o netime grant payment as a result of the award issued by the arbitration panel. My questions today are to the Minister of Learning. What is this payment to the CBE going to cover? The Speaker: The hon. minister. Dr. Oberg: Thank you very much, Mr. Speaker.

W e’ve been working very closely with the CBE for roughly the last four months on their budget. As the hon. member knows, back in the f all they announced that they were going to have a deficit of around $16.5 million. We have been working with them, and indeed we have that almost down to zero right now. One of the stick ing points i n the Calgary board of education was a very unique clause in the arbitra- tion settlement that was reached last June. In that unique clause it stated that the benefits for the teachers would be increased from 70 percent to 100 percent.

This was the only contract in the province that this occurred to. So, Mr. Speaker, what we have d ecided to do and what we did today was put CBE back on a leve l footing w ith all other sc hool boards. This $7 million actually was something that no other school boards in the province had to bear the cost of. So today in the third quarter we announced that $7 million would be used on a onetime basis to cover that this year.

The CBE has been doing some very good things in their education system, and I would just like to take a minute to commend the board for their diligence, for making some tough decisions, and for doing what’s right for students in Calgary. Mrs. Ady: To the sa me m inister: w ouldn’t other boar ds have received a similar clause in the arbitration process, and if so, are we considering similar payments to them? Dr. Oberg: Well, Mr.

Speaker , th e interesti ng part about the arbitration settlement is that of all the boards in Alberta that had the arbitration settlement, the CBE was the only board that went from 70 percent to 100 percent. The rationale that the arbitrat or gave was that because the minutes of instruction, the hours of instruction were taken out of the c ontract, this was to compensate teachers, but in reality it was an added burden that was placed on Calgary that no other school board in the province of Alberta had, and for that reason we recognized that.

Again I will stress that we’ve been working with Calgary, working very well with Calgary for the last four months, and this is what happened because of that. 2:10 Mrs. Ady: My last quest ion is again to the Mi nister of Learn ing. For clarification, then, are there no other boards in the province who provide a 100 percent benefit coverage to their teachers? Dr. Oberg: Well, Mr. Speaker, in actual fact there are about 12 or 13 other boards that do that, but th ose were purely negotiated settlements.

They negotiated that in contracts gone by, in years gone by, so there are 12 or 13 boards that are at that level, but Calgary is the only one who got it fois ted on them because of the arbitration settlement. Evan-Thomas Provincial Recreation Area Ms Carlson: Mr. Speaker, as a part of its continuing strategy to sell out the interests of Albertans in protecting parks and protected areas, the Alberta government has unveiled its draft management plan for the Evan-Thomas provincial recreation area in Kananaskis Country. This plan provides a wea lth of opportunit ies to corpor ations and

144 Alberta Hansard February 26, 2003 developers, from expanding ski areas and chalets to new roads and hotels, but unfortunately this will come at the expense of the wildlife and wilderness that Albertans wish to preserve. My questions today are all to the Minister of Community Development. When, accord- ing to your ow n survey, 90 percent of Albertans bel ieved that the highest priority in Kananaskis should be environmental protection even if this means fewer recreational opportunities for people, how can you claim that you are governing in accordance with the wishes of the people of Alberta with this new plan?

Mr. Zwozdesky: Well, Mr. Speaker, it’s true that there is a d raft management plan that’s been arri ved at a fter at least t wo years of consultation with the local community, individuals around that area, plus some e nvironmental groups a nd others w ith a stak eholding interest. It’s also true that t he draft management plan is out ther e asking for public input and for comments, and the deadline for that passed, I believe, on February 14.

All of those particular comments are being reviewed right now, and once they have been amassed and sifted through, I’m sure I’ll get some final recommendations for that particular draft management plan. I should say in conclusion, Mr. Speaker, that it’s very clear that the policy there refers to the possibility, the potential, of small-scale developments perhaps proceeding, not large scale, nothing outland- ish. Major proposals for new golf courses or new ski hills or things of that larg e type of proje ct would be encourag ed outside the protected area of Evan-Thomas.

Ms Carlson: It isn’t in the plans, and they don’t plan to do it, Mr. Speaker. Given that 87 percent of Albertans said that commercial develop- ment should be directed outside Kananaskis Country, how can this minister condone and promote in these plans on behalf of Albertans the creeping commercialism that is occurring in the Evan-Thomas area under his mandate? Mr. Zwozdesky: You know, Mr. Speaker, that’s absolutely not true. There is no creeping commercialization, whatever that might mean to the hon. member.

I can t ell you that over 60 percent of Alberta’s crown jew el, Kananaskis Country, i s under protec tive sta tus of one t ype or another. We’re very proud of that. In fac t, we’ve ha d a very aggressive program of protection not only for that area but for other parts of this province as well, and the member is fully aware of that. Should there be a ny kinds of proposal s for sm all-scale devel op- ments, they will be considered, and perhaps they will be granted – perhaps they won’t be granted – but it’s way too early to make any kind of rampant suggestions, as the hon. member is alluding to. Ms Carlson: Mr.

Speaker, why waste taxpayer dollars on surveys when this minister never intended to listen to what Albertans were telling him in the first place? [interjections] Mr. Z wozdesky: I’m sorry, hon. mem ber. I didn’t quite catch the . . . The Speaker: Well, hon. minister, there seems to be a bit of a buzz. I’m not sur e if there’s a full moon out tonight or if it’s a special holiday I’m not aware of, but why aren’t you listening pretty much sums up the question. Mr. Zwozde sky: I heard the word “sur vey.” They were just heckling a little too much.

It’s comm on practice , as we go through the delicate issue of balancing environmental protection concerns with concerns that the public has for access to its own beautiful parks and recrea tional areas, to do a lot of consultation. I assure you that there has been a lot of consulta tion with re spect to this draft management plan, as there is with 14 others that are under my consideration or some form of committee consideration at the moment. So this is not a waste of money.

This is a v ery thorough an d honourable proc ess that will yield some very specific results, I ’m sure, of whi ch we can all be proud and which we can all live with. Thank you. The Speaker: The hon. Member for Edmonton-Castle Downs, followed by the hon. Member for Edmonton-Centre. Edmonton Public School Board Mr. Lukaszuk: Well, thank you, Mr. Speaker. As a result of the 14 percent sala ry i ncrease to teache rs, the Edm onton public school board recently projected a $13.5 million shortfall for the years 2002 and 2003.

In response to that, the Minister of Learning announced that his department would conduct an audit of the Edmonton public school board. Today the Edmonton public school board announced that they will be increasing instructional time by some six minutes per day to partially address this issue. My questions today are to the Minister of Learning. What outcomes have you seen from the audit of the Edmonton public school board? The Speaker: The hon. minister. Dr. Oberg: Thank you very much. The formal audit of Edmonton public is not over, but I think we’ve already seen some good results.

One of those results came in a letter from Don Fleming, the chairman of the Edmonton public school board, to myself in asking to move some funds fro m their capital a ccount, whi ch they receiv ed by selling their administration bu ilding, and to pu t it into operating. This amounted to around $2 million. So, Mr. Speaker, through to the hon. member, there are good results coming out. I have not seen the final audit – I would expect it within the next couple of weeks – but I am very optimistic. Mr. Lukaszuk: Again to the Minister of Learning: Mr.

Speaker, will the minister conduct similar audits on other school boards in this province? Dr. Oberg: Well, Mr. Speaker, I don’t entirely like to use the word “audit.” A good example of this is in my previous answer to the hon. Member for Calgary-Shaw, where I stated that we’ve been working with Calgary public for about four months, and consequently what happened today was as a result of that. Any school boards that want us to come in, we certainly will.

If school boards are in a particu- larly bad position, we will certainly go in and attempt to help them, and that’s what we’re doing at the moment with Edmonton public. Mr. Lukaszuk: Mr. Speake r, my last supple mental to th e sam e minister. If in the end the money can’t reasonably be made up this year by the Edmonton public school boar d, would the minister consider amortizing the deficit over a number of years to reduce the impact on students and to prevent shutting down programs? The Speaker: The hon. minister. Dr. Oberg: Well, thank you very much, Mr. Speaker.

In a preface to that question I will say that I met this morning with members of

February 26, 2003 Alberta Hansard 145 Edmonton caucus, an d they m ade an ex cellent representation on behalf of their parents, on behalf of their students. I think their main concern, obviously, is programs for students. My main concern is programs for students. So what I have told them is that I certainly will look at th is following the audit , following taking a look and working with them. I think it’s a little premature to say for sure, but I will take a look at it, and I think that the Edmonton caucus did an excellent job in this. The Speaker: The hon. Member for Edmonton-Centre, followed by the hon.

Member for Edmonton-Strathcona. Policing Costs Ms Blakeman: Thank you, Mr. Speaker. Recently the S olicitor General has been c ommenting on the le vel of f ederal funding for policing in Alberta su ggesting th at the fe deral government isn’t paying its fai r share of policing cos ts. Howe ver, according to an AUMA report on the RCMP c ontract in Alberta with information from the Canadia n Centre f or Justice Statistic s, t he prov ince contributes only 14 percent to policing, where the fed eral govern- ment contributes 37 percent and the municipalities 49 percent. My questions are to the Solicitor General.

Why is 14 percent not enough federal funding for health care, yet the province paying a 14 percent share of funding for policing is just fine? Why the double standard? The Speaker: The hon. minister. Mrs. Forsyth : Thank y ou, Mr. Speak er. Y ou know , the hon. member is quit e con fused.

What the So licitor General was com- menting about on the federal funding were initiatives that I met with the federal Solicitor General, Wayne Easter, on, and that’s in regards to providi ng us fund ing for gang i nitiatives – tha t is a se rious problem in this provi nce – a nd other initiatives as far as terrorism and things like that. On the other issue which she talked about, the funding, it depends on what level the community is. If the community is under 2,500, we pay the shot, and the federal government and our contract is a 70- 30 split. The Speaker: The hon. member. 2:20 Ms Blakeman: Thank you, Mr.

Speaker. Can the Solicitor General tell us why a thir d of the communities in Alberta have notified the RCMP that they will not be renewing their c ontracts? Can you explain that? Mrs. Forsyth: Well, Mr. Speaker, the hon. m ember brings up a good point. We have a serious concern in this province in regard to policing. The police are dealing with a variety of crimes, with some very, very serious issues. We’ve had a committee go out and address some of the issues, and we will be reviewing that and dealing with that shortly. The Speaker: The hon. member. Ms Blakeman: Thank you.

Again to the Solicitor General: what are the priorities of this government when $105 million is spent on VLT upgrades but only $109 million on policing in Alberta? Mrs. Forsyth : Mr. Speake r, I think, a gain, the hon. me mber is confused. The $109 million that she’s referring to comes under my department. Maybe the Minister of Municipal Affairs, also, would like to talk about the funding that comes from his department. The Speaker: The hon. minister. Mr. Boutili er: Thank you, Mr. Speaker.

Under the municipal sponsorship program we have over $95 million to go to communi- ties, and I might say that in the release, for communities under 2,500 – you may be aware that the hon. Member for Lacombe-Stettler has done a police report. Some of the communities, aside f rom those under 2,500, are saying: how co me those under 2,500 don’t pay a cent towards policing? So there is some inequity based on w hat some over 2,500 pay versus those under. And the good neighbours are saying: hey, we’ve got to get some equity here. I thin k it’s an important point. The Speaker: The hon.

Member for Edmonton-Strathcona, followed by the hon. Member for Edmonton-Glenora. Education Funding Dr. Pannu: Thank you, Mr. Speaker. I hope against hope that the Learning minister is reconsidering his mindless refusal to make up the shortfall caused by the government’s failure to fund the arbitra- tion settlement it im posed and the shortfall caused by the cap it imposed on grade 10 credits. These shortfalls are creating genuine emergencies in our scho ols. By failing to li sten to school boards across the p rovince, this Tory government is hurting our school- going children. My questions are to the mini ster.

How does the minister respond to Cindy Jefferies, board chair of Red Deer public schools, who said in a stat ement tabled y esterday, “It’s a terrible shame that this province, with all it s wealth, cann ot seem to fi nd adequate funding for the education of our children”? The Speaker: The hon. minister. Dr. Oberg: Thank you very much, Mr. Speaker. I’ll reiterate what I’ve said in the Assembly several times, actually, this year already, and that is that there was $298 million over two years that was given to the school boards for an arbitration settlement of $260 million. Mr.

Speaker, you heard today tha t we had been working with Calgary public over a four-month period to delve into their budget, to find out what the issues were, and we came out with the conclu- sion that they had received a part of the arbitration settlement that no else had received in Alberta and subsequently did it. You also heard today that with Edmonton public we’re looking at it. We think that there are some very positive steps tha t can be un dertaken to make sure that they balance their budget. Bottom line, Mr. Speaker, there’s been a huge amount of dollars put into education in this province.

We have by far the highest per capita funding, pe r capita spend ing on educa tion of any where in Canada. There is a lot of money out there, and what is happening right now, quite f rankly, is that ta xpayers are demanding account- ability for this government in how it spends its money. The Speaker: The hon. member. Dr. Pannu: Thank you, Mr. Spe aker.

To the same minister: how does the mini ster res pond to Michele Mulder, president of the Alberta School Boards Association, who, i n reacting to th e $142 million shortfall faced by school boards, said in a st atement tabled in this House, “The travesty of all this is that Alberta is the rich est province in C anada [a nd] we shou ldn’t be having conve rsations about cutting teachers or services to students at all”? Dr. Oberg: That’s funny, Mr. Speaker. Roughly an hour ago I had a conversation with Miss Mulder, and she didn’t mention that.

146 Alberta Hansard February 26, 2003 Dr. Pan nu: To the sam e minis ter, Mr. Spe aker: how does the minister respond to the board of tr ustees of Elk Isla nd public schools, who, in a statement I will table this afternoon, say that the minister is misleading Albertans and just not listening when it comes to the government’s refusal to fully fund arbitration settlements with teachers? Dr. Oberg: Well, Mr. Speaker, again, th e hon. me mber seems to have a little pr oblem with his facts.

I actua lly sat down wi th Elk Island public and the affected MLAs, probabl y about three or four weeks ago, and at that time they said: yes, it was going to be tight; yes, they were having some issues. But they also guaranteed me that they would have a balanced budget by the end of this year. There are some tough steps that are going to have to be taken, but let’s put this in perspective. Our teachers received a 14 percent pay settlement in the last arbitration agreement. Our te achers are now paid roughly 10 percent more than any teacher across Canada. That is what has caused this.

We a re working with school boards, as I have said. We’ve gone in on several school boards and will continue to help them. Elk Island public is one that has assured me that they will have a balanced budget this year. The Speaker: The hon. Member for Edmonton-Glenora. Mr. Hutton: Thank you very much, Mr. Speaker. I’ve attended a number of school councils and most of the schools in my constitu- ency over the past few w eeks. Parents have been very concerned about the program cuts being proposed by Edmonton public schools.

My constituents have hea rd that much-needed teachers are facing layoffs, programs are on the cutting block, and that many of these programs will affec t stud ents who a re alrea dy the hig hest need, special-needs students and those who are at risk at a critical time in their life. My question is to the Minister of Lear ning. What is the minister doing to ensure that these and all students are not negatively affected by these proposed budget cuts? Dr. Oberg: Well, Mr. S peaker, I th ink, first o f all, that when it comes to the bu dget, the re will be an incre ase this y ear in our business plan.

The increase is there. I will say that when it comes to special-needs education, you have seen a 10 percent increase per year over the past two years on special-needs education, and you will see a considerable increase to special- needs funding this year. In talking to people around the country, our special-needs programs are probably the number one programs around the country. Talking to the superintendents, they say t hat our spec ial-needs pr ograms are going a very long way.

I guess that what I have a problem with in what the hon. member has said is a lit tle bit of the fear mongering that i s going on r ight now. We’re attempting to work with Edmonton public, and we will do that over the next period of a few months. I don’t think that any taxpayer in this country, let alone this province, would automatically want us to write a blank cheque to school boards purely because they say: we don’t have enough money. The Speaker: The hon. member. Mr. Hutton: Thank you, Mr. Speaker. Aga in to the Minist er of Learning. Parents have been handed school budgets and told: these teachers are gone.

Are these cuts going to affect the classroom? Dr. Oberg: Well, that’s very interesting, Mr. Speaker. In talking to the superintende nt of Edm onton public, I don’t b elieve that they have received their final budget figures, I don’t believe that this is occurring, and ag ain I r efer to my previo us comments about fear mongering. Mr. Hutton: Mr. Speaker, I’m moving to the Minister of Infrastruc- ture now with regard to the shortfalls in Edmonton public schools.

To the Ministe r of Inf rastructure through the Speaker : are y ou working at all with the Edmonton public school board to make any changes around the sc hool utilization rate to he lp reduce some of these cost pressures? Mr. Lund: Mr. Speaker, back about three or four years ago w hen the province was heading into the n ew centu ry scho ol pr ogram, where they were going to spend a billion dollars on school s, there was a decision made by the then minister and the government that, in fact, it would be prudent to look at the utilization and the formulas for calculating it.

One of the effects of the changes has been that the operating and maintenance component that is now administered out of the Department of Infrastructure was affected by those changes in the calcul ation for ut ilization. Where it h ad the most n egative impact was in areas where there are a lot of old schools, particularly old high schools, but we did exempt the high schools that were built prior to 1990 f rom the new calculations. Because of the calc ula- tions, the Edmonton public board did lose about $1.8 mi llion in operation and maintenance funds.

So what we are currently doing is going back and having a look at the calculations. We are asking the department to look at the special circumstances to see if, in fact, there’s something that we can do to even this out. When the formula was applied, there were some jurisdictions that lost money. We didn’t have more money, so some lost, some gained.

Edmonton was one of those that unfortunately did lose some money. 2:30 The Speaker: Hon. members, before we move on to the next item on the Routine this afternoon, might we revert briefly to Introduction of Visitors? [Unanimous consent granted] head: Introducti on of Visit ors The Speaker: The hon. Minister of Health and Wellness. Mr. Mar: Thank you, Mr. Speaker. It is a great pleasure for me to rise today to introduce a very special guest to you and to members of this Legislature.

After nearly 30 years in government in the province of British Columbia in posts that included being Deputy Premier and being awarded such honours as the Order of Canada, Grace McCar- thy turned her attention to raising funds for research to help very sick children with Crohn’s disease and ulcerative colitis and founding a foundation for raising money for such purposes.

In seven and a half short years Grace McCarthy almost single-handedly has raised over $5 million and established the first chair in pediatric gastroenterol- ogy in Canada , at the Uni versity of B ritish Columbia, and all accomplished through volunteer effort. I ask our distinguished guest to rise and receive the traditional warm welcome of this Assembly. head: Recognit ions The Speaker: The hon. Member for Wetaskiwin-Camrose. Alberta Special Olympics Mr. Johnson: Thank you, Mr. Speaker. Recently I had the pleasure of repre senting th e Al berta government at the Alberta Special

February 26, 2003 Alberta Hansard 147 Olympics, held in the city of Wetaskiwin in my constituency. More than 500 athletes from all over Alberta and the Northwest Territories competed at these Special Olympics from February 7 to 9. It was a great event with all of the athletes having, as they said, a hoot and a ton of fun. Amongst the highlights was the closing ceremonies with special guest Lieutenant Governor Lois Hole.

The organizing committee with chair Sheana McDermott, Blain Fuller, and B yron King worked for ove r a ye ar to over see every detail of the games, and their efforts were rewarded in the wonderful experiences of all the participants. The community of Wetaskiwin was also a big reas on fo r the s uccess of these Olym pics. They opened their hearts to the athletes to ensure that their short stay in Wetaskiwin would be enjoyable.

I would ask that all Members of the Legislative Assembly join me in congratulating the athletes, coaches, trainers, organizers, and the community of Wetaskiwin f or the succe ss of this year’s Alber ta Special Olympics. The Speaker: The hon. Member for Calgary-Fort. Ramsay School Mr. Cao: Thank y ou, Mr. Speak er. Today I rise to recognize Ramsay school in my constituency. Ramsay is a strong community with long historical roots to the early days of Calgary. It’s now on a strong growth path as many people now prefer the inner city.

The growth of Ramsay and inner-city communities requires schools, and Ramsay school is the answer. Ramsay school is also going strong because of its robust commu- nity partnerships. Par tnerships w ith the Al exandra c ommunity health centre, the Talisman sports centre, the YMCA , the Janus Academy for autistic children, and the anticipated partnership with the Stampede board will positively affect the quali ty of education and the student enrollment. I believe Ramsay school continues to be a very good and strategic investment for the CBE.

It’s an important landmark in the commu- nity a nd in the city , providing a n excell ent and unique l earning environment for local children as well as children with special needs. The building is historical, solid and sound, and runs efficiently. To conclude, I want to recognize the fantastic work of the Ramsay school staff, parents, students, community residents. My heart tells me to continue to support the school. My head tells me how to find ways to help incre ase the e nrollment and t he spac e utilizat ion. Representing my constituency, I have requested the CBE trustees to do the same. Thank you.

The Speaker: The hon. Member for Edmonton-Gold Bar. United Brotherhood of Carpenters and Joiners Mr. MacDonald: Thank you, Mr. Speaker. I would like to congrat- ulate tod ay the United Brothe rhood of Car penters and Joiners of America local 1325 on a century of success. The union has ov er- come adversity since its formation on November 11, 1902, with 18 members in its rank s. Now l ocal 1325 can be proud of e ach and every one of the trades professionals in its 4,500 strong membership.

The local’s purpose has remained the same over the last 100 years, and the union can take pride in having succeeded in improving the employment terms and conditions for its members and their families. Though the working conditions in this province still aren’t ideal for everyone, workers can take heart that m embers of loca l 1325 continue to advocate for the rights of all Alberta workers. Carpenters have a l ong and proud hist ory dating back to before biblical times.

Many carpenters and joiners, indeed members of the United Brotherhood of Carpenters and Joiners local 1325, demon- strated quality work and p ride in craftsmanship when the y helped build this Legislative Assembly. Members of the united brotherhood have been an integral part of building this province into what it is today. Again, congratulations to the united brotherhood of carpenters for their first 100 years’ participation in the economy of this province. Thank you. The Speaker: The hon. Member for Calgary-West. Centralized Hospital Pharmacy Ms Kryczka: Thank you, Mr. Speaker.

I was pleased to attend with the health minister the official opening of Alberta’s and Canada’s first centralized hospital pharmacy on Friday, February 21, a move that the Calgary health region says will make drug dispensing safer, faster, and cheaper. The $2.5 million central production pharmacy is expected to save the health region $1 million by having most of its hospital drugs in one highly secured location and a f urther $2.5 m illion in nursing time. The pharmacy uses automated packaging systems to prepare medications for acut e care patients in Calgary’s four hospitals.

Hospital staff then have more ti me to f ocus on patie nt care a nd increase the safety and quality of oral/intravenous medications. Steve Long, director of pharmac y for t he CHR, bel ieves t he facility c reates the opportunity for their pharmacy technicians, assistants, and aides to work to their full scope of practice. Pharma- cists will now be able to s pend more time pr oviding med ication advice to physicians and nurses to improve pat ient care. A ll prescriptions can be tracked, and nurses and other staff will spend less time measuring prescriptions.

This initiative is truly an exciting step forward in health care reform. Thank you. The Speaker: The hon. Mem ber for Spr uce Grov e-Sturgeon-St. Albert. Ready Engineering Mr. Horne r: Thank yo u, Mr. Speaker. I would like to take a moment today and recognize an exciting company in my constitu- ency for wi nning Albe rta’s small b usiness a ward of distinction. Ready Engineering of Spruc e Grove won this y ear’s award. T he automation and electrical engineering company which began in 1997 with two em ployees and one clie nt i s an exc ellent ex ample of ingenuity and determination.

Today Ready Engineering employs 19 people and has offices in Houston and Olympia, Washington. I spoke to Lee today, and Spruce Grove is home not only because of a large client base nearby but also the great lifestyle Spruce Grove offers. I especially wanted to recognize Lee Ready, who founded the company with his wife, Susan, in a 750 square foot office space in Spruce Grove. Mr. and Mrs. Ready are a tribute to the entrepreneur- ial spirit that this province boasts and supports. Thank you, Mr. Speaker. The Speaker: The hon. Member for Little Bow. Trevor Brown Mr. McFarland: Thank you, Mr. Speak er.

I’m very pleased t o recognize an outstanding young man from the county of Lethbridge in the constituency of Little Bow, Trevor Brown. Accolades flow

148 Alberta Hansard February 26, 2003 from those who closely know and work w ith Trevor through his personal accomplishments and ongoing involvement. Trevor was an honours student at Winston Churchill high school.

He excell ed in math an d scie nce, e nrolled i n the IB pro gram, maintained an 80 to 90 average throughout high school, frequently was selected student of the month, participated in rugby and football, was a team captain last year, and when his coach was diagnosed with cancer, Trevor rallied his teammates and school peers to successfully raise $2,000 for ca ncer res earch and the family in less th an two weeks.

He’s also instrumental in many volunteering activities with seniors, and he tutors on a part-time basis as well as holding a full- time job this year where he currently is attending his first year at the University of Lethbridge. On February 7, Mr. Speaker , I was pr ivileged on behalf of the Lieutenant Governor of A lberta and the Minist er of Com munity Development to present Trevor the inaugural Queen’s Golden Jubilee Citizenship Medal, one of on ly five young A lbertans, all from smaller communities in Alberta. Trevor, congratula tions on your outst anding achi evements and accomplishments.

Your dad, Laurie; your mom, Betty; your sister Tammy; your gr andma B eth Cl ampitt; and your co mmunity are extremely proud of you, and I know that if the Lieutenant Governor would have bee n there, she would hav e given you one o f her big hugs. Thank you. The Speaker: The hon. Member for Edmonton-Highlands. Edmonton Coalition against War and Racism Mr. Mason: Thank you very much, Mr. Speaker. I rise to recognize a remarkable group of Albertans.

The Edmonton Coalition against War and Racism is a comm ittee of c oncerned individuals from all walks of life and representatives from labour, interfaith, and social justice groups. This group is working to further build the antiwar movement within the greater Edmonton area. They w ork to raise awareness of h ow the po ssible w ar agai nst Iraq is not only not justified under interna tional law but will m ake th is w orld an infinitely more dangerous place.

The coalition re cently organize d two ve ry successful peace marches in this city, the first on a very cold January 15, when 3,000 marched down Whyte Avenue in protest of the war, and the second on February 15, when over 12,000 marched down Jasper Avenue in what I believe is the largest protest march in Alberta history. I app laud and support this group’s hard work to edu cate Edmontonians and Albertans about the disastrous consequences of a war of aggression against Iraq. head: 2:40 Present ing Pet itions The Speaker: The hon. Member for Edmonton-Strathcona. Dr. Pannu: Thank you, Mr. Speaker.

I rise on behalf of the working poor in Albert a to table a petition s igned b y 58 Al bertans f rom Calgary, Banff, Strathmore who ar e p etitioning the Legisl ative Assembly to urge the government to immediately raise the minimum wage in our provinc e to $8.50 per hour and index it to the cost of living. Thank you, Mr. Speaker. head: Tabling R eturns and R eports The Speaker: The hon. Minister of Justice and Attorney General. Mr. Hancock: Thank you, Mr. Speaker.

Today I have the honour and privilege on behalf of the Mini ster of Children’s Services of tabling with this Assembly the r equisite number of c opies of the membership and bio graphies o f the members of the Premier ’s Council on Alberta’ s Promise . I believ e the hon. m inister in comments yesterday in committee indicated that she would provide the names of the people who had been invited to participate and who had volunteered their time and efforts to make Alberta’s Promise a very success ful ve nture and m ake thing s better f or Albert a’s children. The Speaker: The hon.

Member for Olds-Didsbury-Three Hills. Mr. Marz: Thank you, Mr. Speaker. I rise today to t able the appropriate number of copies of signatures of 1,64 1 nam es from citizens of Didsbury and area who are requesting that the Didsbury hospital services area become part of the C algary regional health authority. The Speaker: The hon. Member for Edmonton-Highlands. Mr. Mason: Thanks very much, Mr. Speaker. I ha ve one tabling today. It’s a letter from Ms Rachelle Nelson of Fort Saskatchewan dated February 21, 2003, and addressed to her MLA .

Ms Nels on was shocked to find that her natural gas bill jumped from $153 in December to $270 in January. She points out that as the Premier had promised to protect Albertans from the price of natural gas, why is he not now keeping his promise? The Speaker: The hon. Member for Edmonton-Strathcona. Dr. Pannu: Thank you, Mr. Speak er. I’ve got one ta bling today. It’s a document that I undertook to table in this House d uring the question period.

It’s five c opies of a ne ws release from the Elk Island public schools board of trustee s dated February 22, 2003, a current document, and it’s titled: Government “Just Not Listening.” Thank you, Mr. Speaker. The Speaker: The hon. Member for Edmonton-Gold Bar. Mr. MacDonald: Thank you very much, Mr. Speaker. I have one document to table for the benefit of the Assembly this afternoon, and it is a letter dated February 12, 2003, from the office of the Minister of Learning, and it is addressed to Mr. Bill Kobluk.

It is regarding tuition fees and program access at the Uni versity of Alberta, and I would urge all mem bers of t his Assem bly to ple ase rea d this document. Thank you. The Speaker: Other members on tablings? head: Orders of t he Day head : Transmittal of Estimate s The Speaker: The hon. Minister of Finance. Mrs. Nelson: Thank you, Mr. Speaker. I have received a cer tain message from the Administrator of the province of Alberta, which I now transmit to you. The Sergeant-at-Arms: Order! The Speaker: Hon. members, the Administrator transmits supple-

February 26, 2003 Alberta Hansard 149 mentary estimates of c ertain sums required f or the serv ice of t he province for the fiscal year ending March 31, 2003, and recommends the same to the Legislative Assembly. Please be seated. Mrs. Nelson: Mr. Speaker, prior to moving a num ber of motions relevant to the supplementary estimates, I w ish to advise that this morning I provided the government’s 2002-2003 quarterly budget report for the third qu arter to all MLAs. We hav e also made this report public, as required by

section 9 of the Government Account- ability Act. I have tabled this quarterly budget report as the amended consolidated fiscal plan. This revised plan is required by

section 9 of the same a ct whenever a subsequent set of estimates is tabled during the fiscal year. I’ve also table d the third-quar ter activity report for 2002- 2003. This document describes the major achievements of our government during the recent period. I wish now to table the 2002-03 supplementary estimates, No. 2. These suppleme ntary e stimates will provide addi tional spending authority to 14 departments of the government. When passed, these estimates will aut horize an inc rease of $206,642,000 in operating expense and capital investment. Mr.

Speaker , s ection 8 of the Government Accountability A ct requires that the government table a new and amended consolidated fiscal plan when there is another set of estimates. I have just tabled the amended fiscal plan, the 2002-2003 quarterly budget report for the third quarter, in the Legislative Assembly. head: Government Motions 6. Mrs. Nelson moved: Be it r esolved that the Legislative Assembly do resolve itself into Committee of Supply, when called, to consider supply to be granted to Her Majesty. [Government Motion 6 carried] 7. Mrs.

Nelson moved: Be it resolv ed that the message of the Admini strator of the province of Alberta, the 2002-03 supplementary estimates, No. 2, for the gen eral revenue fund and all matters connected therewith be referred to Committee of Supply. [Government Motion 7 carried] 8. Mrs. Nelson moved:

Be it resolved that pursuant to Standing Order 58(9) the number of days that Committee of Supply will be called to consider the 2002-03 suppleme ntary e stimates, No. 2, for the general revenue fund shall be one day. [Government Motion 8 carried] head: Government Bills and Orders Second Reading Bill 2 Financial Statutes Amendment Act, 2003 The Speaker: The hon. Minister of Finance. Mrs. Nelson: Thank you very much, Mr. Speaker. It is my pleasure to move Bill 2, the Financial Statutes Amendment Act, 2003.

The proposed amendments are necessary to proceed with a new fiscal fram ework for Al berta as recommended by the Financial Management Commission. The commission noted this province’s enviable position as a fiscal leader, but it also said that we could do better. This new fram ework is desi gned to addre ss the im pact of volatile energy prices on bu dget planning, and it addresses capital planning pressures. In order to proceed , t he proposed cha nges are required to t he Fiscal Responsibility Act, the Government Accountability Act, and the Financial Administration Act.

Some of the amendments mark some significant changes in the way we conducted business in the past but remain t rue to our princ iples of ope n and accounta ble government and prudent fiscal management. It’s important that I draw your attention to these key amendments. One amendment to the Fiscal Responsibility Act would result in the budget, quarterly reports, and the annual report continuing to show two bottom lines. You will still see net results of operations and the results for fiscal policy purposes, which we all know is called the economic cushion.

Currently there is only one adjustment between these two bottom lines. It relates to the unfunded pension liabilities, which have been relatively small in amount, that have continued to work under the new framework. Since we have a separate long-term legislative plan to address unfunded pension liabilities, this adjust- ment has been unde rstood and not be en an issue in our reporti ng.

Results for fiscal policy purposes will now also account for revenue transfers in and out of the sustainability fund and exclude disaster funding and funding for the capital account. 2:50 If you recall, under the new fiscal framework we will be budgeting for natural resource revenue to be set at $3.5 billion. Years in which nonrenewable resource revenue is below $3.5 billion or the costs of emergencies or disasters are significant, you co uld see an actual consolidated drop or deficit reported by the Auditor.

Now, this kind of deficit would be allo wed because the actual deficit would have been prefunded by prior years’ surpluses and would be covered by the sustainability fund, the capital account, or the retained earnings of the Ag riculture Financial Se rvices Corporation and the crop reinsurance fund. We would also show various adjustments for the draws from the sustainability fund and the capital account to get to the net result for fiscal policy purposes.

The net result for fiscal policy purposes will continue to show th at we have balanc ed our b ooks, and I w ant to make that very clear: this is not a return to deficit budgeting. It’s against the law. We will have a sustainable spending plan in ea ch year’s budget based on $3.5 billion of resource revenues. If there’s a shortfall in resource revenue, we’ll be able to draw on the fund instead of cutting spending in the middle of the year, and disasters and emer gencies will be funded even if there isn’t a revenue windfall to cover them.

This is a consequence of setting up a sustainability fund to stabilize volatile energy revenues. There will be transfers in and out o f the fund, but we w ill have accounted for the transfers out of the fund with previous surpluses put into the fund. Although I dread getting into accounting details, you should also understand that we’re moving closer to the private-sector model for capital. Only amortization will count towards our bottom line rather than the full cost of the new capital that we own. This change brings a number of technical matters o n how the cushion is determined.

Assets will show up o n our balance sheet, a new idea for this province to record its assets. We may also increase our liabilities on the balance sh eet if we choose to look at alt ernative fo rms o f financing of our capital as was recom mended by the Financial Management Commission. Another new initiative that adds flexibility to capital planning is the ability to car ry ove r funding f rom one y ear to the next, Mr.

150 Alberta Hansard February 26, 2003 Speaker. I did look very hard to find the rule that says that every- thing in government has to end March 31 at midnight, and I couldn’t find that rule. So we brought some reality in, and we will be allowed to carry capital funding forward from year to year. In other words, if a project can’t be completed because of weather conditions, the funding that isn’t used on the project that year could be carried over to the next year. It makes common sense to do that.

These types of decisions will be laid out in the three-year capital plan that will now be required as part of the budget. The accumulated debt from prior years will still have the same legislated timetable for it to be repaid. Another signi ficant chang e is th at impl ementation of the sustainability fund means th e old 75 -25 percent rule for surpluses will be gone. The contingency reserve for in-year spending will be fixed in the bu dget as at least 1 percent of revenue, or about $200 million.

Disaste rs and em ergencies, net budg eted incre ases, and payments under the Natural Gas Price Protection Act and the capital account would not be charged to the contingency reserve. Any cash available beyond the $200 million from year-end surpluses, except for that held in f unds and agencies, would go to the sustai nability fund. The fund cannot go into debt. If the fund grew to more than $2.5 billion, then we would have a policy decision to m ake use of the excess on things lik e debt repa yment, adding to t he herit age trust fund, or capital i nvestment. It couldn’ t be used f or ongoi ng operating costs.

So any money currently dedicated for debt repay- ment will continue to be used for that purpose. Other amendments a re primarily technical, Mr. Spe aker. T his legislation marks a new era for Alberta, one that g ets us of f the energy roller coaster in favour of a more predictable and sustainable funding over the long term. Mr. Speaker, I urge all members to support Bill 2. Thank you very much. The Speaker: The hon. Member for Edmonton-Gold Bar. Mr. MacDonald: Thank you very much, Mr. Speaker. It is with interest and a great deal of pleasure that I rise to speak on Bill 2 this afternoon.

We on this side of the House have been very anxious to have this idea enshrined in legislation and accepted by the govern- ment side, a better balance betwee n debt repay ment and a more balanced approach to deal with the day-to-day routine of budgeting for this province. Certainly, when we look at the third-quarter fiscal update that the hon. minister mentioned earlier, we recognize the importance and the significance of oil a nd natural gas royalties, or royalty revenue, to this province.

It has been something that members on this side of the House have been saying for a number of years, and there have been legislative initiatives in the past. The hon. Member for Lethbridge- East had a bill in 2002, Bill 208, the Fiscal Stability Fund Calcula- tion Act. W e can go ba ck to 1999, and the hon. M ember for Edmonton-Ellerslie had Bill 228, the Fiscal St abilization Fund Calculation Act. This is a walk down memory lane, Mr. Speaker. In 1998 the hon.

Member for Edmonton-Mill Creek, who at that time was on this side of the House, who is now Minister of Community Development, had a similar legislative idea, the Fiscal Stabilization Fund Calculation Act, again, Bill 222. There are those that think imitation is a fine form of flattery, and in this case I would have to say that they’re absolutely correct. Finally there is going to be some stability to the roller coaster, the ups and downs in revenue that we experience in this province from natural gas and oil resources.

Now, when we look at accumulated debt and net assets and cash available from operations f rom one y ear to the next, thes e are important issues. There’s no doubt about that. The whole notion of financial prudence I believe go es back to a former Liberal leader, Mr. Laurence Decore. He would certainly wave his wallet, and he had a machine to tabulate or calculate what the debt was going to be, and finally people took notice. We could, I suppose, go back to the Premier’s famous speech in Leduc – I wasn’t there, and I’m told that it’s not the last school that the hon.

Premier visited – that indicated there would be tightfisted fiscal responsibility in this province. Now, that didn’t last too long. In the last few years we have seen an increase of close to 50 percent in program spending. We even got the supplementary estimates this afternoon. I was looking at a budget document earlier. I believe the total estimated was $19 billion, and the n suddenly it shot up to $20.4 billion, so there are changes in the budget. Budgeting has certainly not been a strong suit of thi s current g overnment.

When y ou look at th is increase i n spending – in fact, I was a t a me eting las t night o n education, and people asked me: when we spend all this money in this province, where does it go exactly? No one has the answer to that question. It’s apparent that no one know s. I can bring in the Auditor General’s report and go through it page by page, and certain respectful hon. members from across the aisle get indignant. Now, I don’t know why they’re so defensive. We bring up public accounts all the time, and the hon. members get defensive about that as well.

Everyone has a right to know where the tax dollars are going. [The Deputy Speaker in the chair] 3:00 Now, beginning in the next fiscal year, this government is going to start buildi ng a nest egg, a stability fund, t hat this side of the House has been advocating for years and years and years. Saskatch- ewan used their stability fund, or their nest egg. You’ve always got to keep the magpies out of the nest – always, always – because they can destroy the eggs in the nest pretty quick, and they can destroy the whole thing.

Th e magpies in this situation would be political magpies, and they want public funds for no rhyme or reason, and I would say that one of those political magpies would be private health promoters. This electricity bill, which we’re going to debate a little later on th is afternoon, Bill 3: I don ’t know if there are political magpies there or not, but we will find out. We will study the issue, and we will determine if the Member for Edm onton-Riverview is correct with his cautious suspicions that perhaps there are political magpies there.

But this idea of a nest egg, I’m very pleased that the government has finally decided to do t he right thi ng and ado pt a good Liberal policy. Hopefully we won’t have to use this stability fund and it’ll be able to grow, and perhaps at some time portions of it could be set aside to replenish the heritage savings trust fund. I’m disappointed to see in this third-quarter annual re port that the results have n ot been spectac ular. The y cer tainly, Mr. Speake r, have no t been spectacular. In fact, it is with sadness that I have to note, and I’m quoting from the third-quarter fiscal update now, investment income.

Total investment income was budgeted at $1 .2 billion. It is now forecast at nega tive $1 19 mill ion, $ 1.3 b illion b elow the bu dget estimate. The decline in equity markets is expected to result in a $704 million loss in the H eritage F und and othe r endo wment funds (rather than budgeted net re venue of $635 mil lion). This l oss includes a $506 million wr ite-down in asse ts, where the v alue is consid ered permanently impaired, and net realized losses of $198 million. I gues s “perm anently impaire d” mea ns it’s w orth very little to nothing. I hope we don’t see any more investment losses like this.

I’m sure – and perhaps the hon. Member for Edmonton-Glengarry

February 26, 2003 Alberta Hansard 151 can shed so me light on this – there’s going to be a review of the investment practices of that heritage savings trust fund. Certainly, in other departments – and this is considering that the budgets there are much more modest, that they’re not like a pool of cash with $11 billion in it – there are some pension funds that have been set aside, and I notice that there’s been a reduction in the return on those investments, but nothing like this spectacular loss.

I’m curious to note if any one i s phoni ng the admin istrators of those res pective pension funds of the government to seek their advice. It wouldn’t be a long-distance call either. I think a 427 number would reach these people and reach them probably quite quickly. The idea of a nest egg and what this money could be used for if we ran into lower than ex pected revenues or financial difficulty – i t certainly would provi de some stability to the schools. Now , the meeting I was a t last nig ht, the school was in de sperate need of repair.

In fact, some students, a class full of them, had been locked inside the school, locked inside a classroom over lunchtime. They got locked in. They were lucky that a member of the staff . . . Mr. Bonner: The janitor came. They had to take the hinges off. Mr. MacDonald: The janitor couldn’t take the hinges of f, but a member of the staff could use a knife and rescue the children. Lucky there was no fire or there wasn’t a fire alarm. That’s not the only mechanical deficiency with this school. There are certainly cracks in the cinder block walls. It’s been on the books for repair so many times.

It’s been taken off because of what the minister said earlier: roller-coaster, or up-and-down, funding. Mr. Bonner: Isn’t it a 52-year-old school? Mr. MacDonald: No, the school is not 52 years old, hon. member. The school woul d have bee n built in 1961, so it ’s a 42-year-old building. It also has poor wi ndows, other deficiencies. It has a $60,00 0 heating bill, which a better heating system would certainly reduce. Now, this school has been removed from receiving an upgrade three times that this member is aware of.

Hopefully this stabilization fund is going to prevent it from being removed once again, because the repair costs have now escalated. The repair c osts have gone from over $2 million to in excess of $4 million because it was put off. It had to be def erred and deferred and de ferred. Of cours e, the condition of the building worsened. That’s one thing the nest egg, the stability fund, can be used for. We can see other uses for this fund. Of course, there will be firm financial commitments for each department. Last year the Infrastruc- ture department had a significant reduction in funding commitments.

There were projects pulled all over the place, and there was certainly a cost to that . This st ability fund wil l, as I sa id, mak e it mor e predictable not only f or the depar tment of ficials but als o the contractors. Now, in concl usion, Mr. Speaker , when we thin k of a fi scal framework for the 21st century, I’m pleased to see that the govern- ment is adopting an idea that was presented as recently as last year by the hon. Member for Lethbridge-East.

I certainly hope that government members are over their tiredness from their enthusiastic support for the rough fescue grass and will participate in the debate this afternoon not only on Bill 2 but also on Bill 3. Thank you. 3:10 The Deputy Speaker: The hon. Member for Edmonton-Highlands, followed by the hon. Member for Edmonton-Glengarry. Mr. Mason: Thank you very much, Mr. Spea ker. I’m pleased to rise, as well, to speak to Bill 2, the Financial Statutes Amendment Act, 2003.

I believe that this bill will ac tually end some of the practices of this government that we in the opposition have been campaigning against for a considerable period of time. One is t he misuse of estimates on resource revenue in order to do what we like to call fudge-it budgeting. The gover nment has of course consis- tently underestimated royalty rev enue in their es timates over an extended pe riod of tim e, billions of dollars in s ome years and a considerable amount in almost every other year.

That’s one of the problems that may be partly addressed by this bill because, of course, they’ll be creating a fund, a stability fund, in order to try and balance those things out. The government has made use of fudge-it budgeting for a number of crassly political r easons. O ne is, of course, tha t if they ’re underestimating their resource revenue on a regular basis and by a substantial amount in each budget, they can claim poverty as we go through the ye ar and va rious crise s mani fest t hemselves; f or example, the education crisis that we are now seeing in our schools. They can claim poverty.

Then at the end of the year, Mr. Speaker, they have this so-called unanticipated surplus of billions of dollars, and they look like they’re brilliant financial managers. Well, they’re brilliant political tacticians but not brilliant financial managers. So I think that that’s one thing that we believe will be partly offset by this. You know, I know that the Liberal opposition has been campaign- ing for a stability fund for some years. We were only too happy to steal their idea, and we encouraged the government to stea l their idea, and the government has stolen their idea and that’s because it’s a good idea.

No one party has a monopoly on good ideas. I know that the Premier thinks we’re much worse than the Liberals, but we also have some very good ideas from time to time. We compete with the Liberals to see who can upset the Premier the most. Now, I’d like to go on to another point that’s covered in this bill which, I think, is something that we’re quite prepared to take credit for, and that is the elimination of the ridiculous, outrageous 75-25 split to go to debt reduction, that has bedeviled this g overnment’s financial position for many year s.

When it was c ombined w ith fudge-it budgeting and these magical, unanticipated, quote, unquote, surpluses appeared every year, surprise, surprise, 75 percent of it by law had to go against the debt. So the government was engaged in starving important programs by under estimating the re venue, and then, surprise, surprise, they have to put three-quarters of the surplus against the debt. This is going to be gone now, Mr. Speaker, and it can’t come soon enough, as far as we’re concerned, because we’ve always called this debt reduction by stealth, and I think that’s exactly what it is.

So I think there are a number of points that can be made. I know that the member for Edmonton-Gold Bar talked about schools in his constituency, and I know that schools in my constituency are badly in need of money. So the addition of additional funds for infrastruc- ture, which is not specifically in this bill but was contained in the update provided by the minister today, is also a bit of welcome news that I thi nk the public has been de manding from the government. Municipalities have been dem anding it, hospitals have been demanding it, and school boards have been demanding it.

It’s a step in the right direction, Mr. Speaker, but given that the government has admitted that there’s $8 billion of expenditures required to bring our infrastructure up to date, then somewhere over $900 million is only a small part. Mr. Speaker, we’ve always talked about the false economy, of doubling up on your mortgage payments in order to pay down your mortgage more quickly and failing to repair the roof on your house

152 Alberta Hansard February 26, 2003 when it needs it. If it rains, the damage can destroy the entire asset that you’re hurriedly trying to reduce the mortgage on. So I think that what the governm ent has done is it ’s shifted its debt f rom financial debt into physical infrastructure debt, and it’s just as real as if it was a note that had to be paid. So I think that that’s one point that I’d like to make. I’d like to go on a bit more about the schools. I’ve been touring some of my schools, like other MLAs, and I know that the Eastglen high school needs a major overhaul.

It’s basically a sound building, but it’s 50 years old, Mr. Speaker, and so it’s reached the end of its design life. It can be preserved for another extended period of time if the government is prepared to put the money in, but the longer it delays, the more it’s going to cost in the long r un, and the most economic way to approach that is to put the money in now. I believe the sch ool needs appr oximately $20 m illion to be com pletely refurbished, and then it will be good, I’m sure, for another many, many years to come.

I’ve also toured some of the o ther scho ols, and t here are some excellent programs at some of the schools in my constituency that help high-needs children learn to read. They no lo nger categorize them, Mr. Speak er, as jus t needing help and socialization. They expect a performance from these students. They take some o f the students – for example, in mathematics and reading, they give them special help – and they turn those that have lagged behind and start off the far thest be hind into the top pe rformers in rea ding and in mathematics.

The school programs there are absolutely outstanding, but again there are continuing threats with p rograms being shut down or coming under the gun, and many of these excell ent programs may not be there next year. So I think that both on the program side and on the capital si de there is a ve ry, very strong need f or more a dequately funding our schools, and the schools in Edmonton-Highlands do an excellent job in difficult circumstances. The government could certainly do a lot more to make the lives of the students and the teachers a little easier because quite frankly, Mr.

Speaker, it’s got to be seen as probably the most significant and important investment that this province can make, and tha t mean s investi ng in its y oung people a nd their education. So, Mr. Speaker, I’d just like to indic ate that generally we think that the government is moving ever so slightly in the right direction with this bill, and both oppo sition parties have been pressing them in these directions very hard for a number of years. We know that a blue-chip committee was set up by the Minister of Finance to study it, and many of their recommendations are included in this act.

The New Democrat opposition did appear before this c ommission and make proposals, particularly with respect to the ending of the 75-25 mandatory debt redu ction req uirement th at is cu rrently th e law. We’re pleased to see that the commission took our advice and that the minister took their advice, and hopefully the Legislature will take the minister’s advice and therefore be taking our advice, and we’d be very happy with that.

So I’d just like to close by saying that this particular bill I think is a recognition that this is a very wealthy province , and there’s a modernization of the financial machinery that’s included in this bill. It doesn’t take away the capacity of the government to misrepresent potential revenues or to plead poverty when it wants to and have an abundance of riches when that’s convenient, but it goes some way towards putting some limitations on those political maneuverings, and I think that it represents a positive step forward for the province. Thank you, Mr.

Speaker. 3:20 The Deputy Speaker: Before calling on the next speaker, I just want to remind hon. members that I have at least one person who’s asked to make some questions or comments under Standing Order 29. The hon. Member for Edmonton-Rutherford. Mr. McClelland: Thank you, Mr. Speaker. My friend representing Edmonton-Highlands in his comments indicated that the government consistently underestimated resource revenues, which resulted in a surplus at the end of the year.

Now, when the member was making those comm ents, I w as ref lecting on a period of t ime w hen th e government consistently overestimated revenues, and I was wonder- ing whether it would be better to be in a position of being conserva- tive on estimates of revenue so as not to be caught at the end of the day with bad news rather than good news.

And since the revenues are very difficult to predict and that we do use as a government the very best objective minds to try to get a handle on it, what does the Member for Edmonton-Highlands recommend that we do rather than the procedure that we’re using now, the conservative best methods? The Deputy Speaker: The hon. Member for Edmonton-Highlands. Mr. Mason: Well, thank you, Mr. Speaker. I’m caught between the rock and a hard place. I have to choose between being conservative and being liberal, and I pick neither of the above.

But I think if you really look at some of the estimates that were used and some of the figures – and I don’t have them at hand, but I do have them – where prices were estimated for oil and gas in budget after budget, you’ll find that they were not reasonable, that they were set too low. So the answer, I think, is not to be too conservative or to be too liberal but to be more honest and use the best available information. I submit that the government has not used the best information because they have wanted to and been m otivated to underestimate our roy alty revenues. Rev.

Abbott: I wonder if the hon. member opposite could give us an honest forecast of what he thinks the natural gas price will be for our next fiscal budget year? For the record, of course. Mr. Mason: Not offhand, Mr. Speaker. The Deputy Speaker: No further questions? Then we will go to the next speaker. The hon. Member for Airdrie-Rocky View. Ms Haley: Thank you very much, Mr. Speaker. It’s an honour to be able to get up a nd just address this for a few minutes.

You k now, after listening to my colleagues from across the way, I’m motivated to remind them th at 10 years ago in this p rovince we had a $22 billion debt and a $3.5 billion deficit, and we struggled with ways in which to deal with that and try and develop sustainable programs for the province of Alberta and for the people of this province so that they could once again be proud of where they lived and the programs that they wanted. We brought in the F iscal Responsi bility A ct, deficit elimination acts.

We brought in all kinds of things limiting government’s ability to deal anywhere outside a specific parameter when it came to our fina nces, and i t worke d. We re duced and eliminated the deficit in the first co uple of years, and we managed from there to pay down $17 billion of a $22 billion debt. I want to remind people of the impact of a $22 billion debt. The impact was $1.5 billion in debt servicing cost, otherwise known as interest. The third largest department of government was interest. It doesn’t provide a job, it doesn’t provide any services but, my God, is it easy to rack it up.

So, y es, we attempted to deal realistically with a very large problem. We set aside 25 years if that was what it was going to take to pay it off.

February 26, 2003 Alberta Hansard 153 We have this gift in this p rovince called oil and g as, and ev ery once in a while the prices s pike beyond what any body has a ntici- pated, whether it’s beca use of a Persian G ulf wa r, t he ongoin g problems with Venezuela, the problems in Iraq today, the extra cold and long winter that everybody in the northeastern United States is experiencing where we se ll gas, the fact tha t their res erves a re running low, or a thousand other reasons that can drive prices on the spot market up and do wn.

So here we are in Alberta blessed with this resource, one of the few places i n North America with these types of resources, and we have one of the lowest taxes anywhere in North America. We have no sales tax, unlike most places in North America, and one of the things that helps to prevent more and more income tax, more and mo re corporate taxes, more and more sales taxes is the fact that once in a while we get lucky with royalties. So I’m supposed to s it he re and beli eve th at we’re dishonest, misrepresenting the position of this government. Well, let’s go back. Let’s talk about that misrepresentation.

We have quarterly updates. Somebody please t ell me ho w ma ny other g overnments in this country and in the United States actually have quarterly updat es. Well, try none. You know, misrepresenting? Every quarterly update if there has been a change in natural gas and oil prices, we reflect it upward. Misrepr esentation? It always f ascinates me how these comments get made and nobody ever has to say: well, I was just sort of kidding or just being an envious political wank in here. The truth is that we don’t misrepresent anything.

I hav e never, ever in 10 years gone and lied to my constituents about anything, and I never will, whether anybody over there likes it or not. If somebody asks me a question, I’m going to answer it. When we talk about the Fiscal Responsibility Act and the 75-25 split, it was never an easy decision to go 75-25. All we tried to do as a government was to make sure that as quickly as possible with the least problems possible for Albertans, i.e., no tax increases to pay down debt, we went with surpluses when we were lucky enough to get them to r emove as muc h of that de bt from Albertan s as we possibly could.

We’re now down to $5 billion, and t hat’s still $5 billion too much, but it’s way better than $22 billion w ith a $3.5 billion deficit, where our cousins, you know, a little bit west of us in British Columbia, have a $3.8 billion deficit this year. How may billions of dollars across this country ar e bei ng squandere d on interest bec ause peop le have such a difficult ti me making tough decisions? Mrs. Nelson: Thirty-six point seven billion. Ms Haley: Thirty-six point seven billion dolla rs, just for interest, and of course our wondrous media don’t bother talking about that.

The fact that if you had $37 billion to s pend on health care in this country, that would be $3.7 billion f or Alberta, w hich, oh, by the way, is right around 50 percent of what they should be paying. But that’s okay. We’re here in Alberta, and, you know, apparently we just lie to Albertans all of the time. We proceeded with a 75-25 split bec ause t hat was the correct thing to do, and when we had 25 percent of a fund left for onetime spending, we got chastised and criticized for that too. Truth is we do have some infrastructure deficits in this province, whether it’s roads or schools or hospitals.

We’ve spent over a billion dollars in the last three years on schools, but we probably need another one and a half billion in order to solve all of the problems that have built up over decades of overspending or perhaps not spending enough. The new FMC. You know, how do I say this? I believe that it has great potential. I really do. I think the sustainability fund can solve some problems.

I think, however, going from one system to another creates its own pressures, and those are pressures that are going to be difficult for the next six months while everybody sorts o ut exactly how it works and what it means. 3:30 If we can in fact set aside $900 million in a capital fund or if this allows us the abili ty to use a capita l bond issue a t some point for another billio n doll ars’ worth of cons truction progr ams, if that’s what the right number is, then I think that’s wonderful.

I would, as a very proud Alber tan, be enormously happy to convert my dying mutual funds and my RRSP to, you know, a whole bunch of Alberta bonds even if the interest rate was low. At least I’d know that I was getting something back. I see great potential on that side. Mr. McClelland: I’m gonna trade my Nortel in for one Alberta. Ms Haley: You’re helping me, Ian. I appreciate it. As to the changes in the legislation, yeah, I have some difficulty with the whole concept of restricting the amount as it goes into the $3.5 billion. I need to know as an Albertan, as an MLA: is that the right amount?

And maybe it’ll take us a year to determine if that’s the right amount. I worry about it because I’m not sure that we’re keeping up w ith in flation on s ome of the spending side. Not on health care and education: I think that if we were all being relatively honest, we could look at our popul ation and our inf lationary numbers and we would say that health and education have kept up. There are other areas where I think there’s room for some concern about whether or not we’ve created too much pressure by trying to be too fiscally tight. You know, as my old dad would say: it was a crap shoot.

You do your very best; you try hard. To satisfy all of the needs, you try to satisfy some of the wants. But it’s never possible to do everything for everybody all of the time, and tough decisions have to be made. I’m very grateful to my caucus for making the tough decisions when they have to because each and every one of us has pressures at home. I have o ne o f the hig hest growth rate ridi ngs in the pr ovince of Alberta which means that no matter what we do, I will n ever have enough schools built fast enough. And my colleagues from Calgary- Shaw and from Banff-Cochrane – we’re all in the s ame end.

This one here too. Mr. Knight: Grande Prairie-Smoky. Ms Haley: Oh, yeah. Not you. I don’t care. Sorry. He can wait. The truth is that I need more schools. I need portables moved in. I’ve got some schools that need repairs. I’m competing with cities that sometimes have only 75 percent occupancy, but I may well have 125 percent occupancy. I can’t get the schools built fast enough, and I have no inner-city schools to move kids into. So we’re all laying everything on the line trying to get the things that we need for our own ridings, and I’m no different than anybody else. I want my riding to be happy.

I want a new overpass for the south end of Airdrie. I’m thinking that my chances are not looking real good at this point, but as a P3 maybe I can get it. I don’t know, but you don’t quit and go home and pout. You keep working to try and get the things that you need. Do I think it’s a panacea? No. But it gives u s a flexibility and a n opportunity to do some things in a different way, and I’m going to do my best to make sure that it works properly. The last comment I wanted to make was on rebates for natural gas, Mr.

Speaker, and I only want to touch on this because when we talk about money that goes to a capital fund of $900 million, that money is coming from royalties. Yes, Albertans are paying higher prices whether they’re filling up their car or for their heater in their home

154 Alberta Hansard February 26, 2003 or for thei r power, and there’s no question about that. A l ot of people are struggling with that. But in the year 2000 in the United States they did a report on the national energy policy that showed that the average middle-class American family was s pending 3.8 percent of their after-tax income on their energy needs. So whether that was heating or cooling or transportation, that’s how much it was.

With the huge price spikes in the year 2000, with natural gas skyrocketing – their home heating oil is going up; their power bills are ratcheti ng up, partic ularly in Cali fornia – they w ent to 4.8 percent of their after-tax income. We need some pers pective on this iss ue. I am not in fav our of anybody not being abl e to heat t heir homes.

That’s not what I’m trying to say, but it’s easy to be hysterical and find a way to spend $400 million or $500 million here, or we can spend that same $400 million or $500 million on school con struction or roads or other things that we need as a province without having to increases taxes, without bringing in a sales tax. These things have to be paid for. As an Albertan I’m so proud to have grown up in the oil patch, but I know what the oil pa tch has done for this province. It’s built it.

It’s still building it, and once in a while we need to be grateful and think about that reality because without it our taxes would probably be 300 or 400 percent higher than they are today on the Alberta side. The only way we could do the things that Albertans expect us to do would be to have to tax them to do it. Right now with our royalties we are absolutely blessed to be able to live in a province where we can get a road built, get a new school, and maybe not satisfy every- body’s wants, but I’m pretty sure we’re meeting the vast majority of their needs. Mr.

Speak er, I wa nted to congratulate our provincial Finance minister for bringing this forward. I know that it was a tou gh struggle for her. I happen to be the chairman of a very tough caucus. We take no prisoners. She has had to earn her stripes on this one all the way through, and we probably aren’t finished harassing her yet, but we’ve had a good time so far. It’s a pleasur e to b e able to s peak in he re and addre ss this important issue, so thank you. The Deputy Speaker: Standing Order 29. Questions or comments? The hon. Member for Grande Prairie-Smoky. Mr. Knight: Thank you, Mr. Sp eaker.

The hon. member m ade a statement in her presentation. She said that interest doesn’t create a single job. I would think that it might take hundred s of p eople to look after $1.5 billion in interest payments. My question is: does the hon. mem ber have no compas sion for thos e n ow unemployed accountants? Ms Haley: Mr. Speaker, you know, with the greatest respect to my colleague, who’ll probably never get to speak in caucus again, the answer would be that that accountant can get a real job. The Deputy Speaker: The hon. Member for Edmonton-Gold Bar. Mr. MacDonald: Thank you very much, Mr. Speaker.

A question for the hon. Member for Airdrie-Rocky View: who created the $22 billion debt that y ou referred to in y our remarks? W hat did t hey spend it on and why? Who created that? Ms Haley: I’m happy to try and take a shot at that. Albertans have very high demands, and it is very hard to say no. So during the ’80s, as I recall t his, the pric e of oil w ent up. We started t o create the heritage savings trust fund.

The price of oil went down, dropped to about 45 percent of the revenue that was streaming into the province, and the question of the day back in the mid-80s was: do we sla sh spending by the same amount, or do we try to ride this out? They made the decis ion under the lea dership of Mr. Don Ge tty, the Premier of the day, that they would try to ride it out in the hopes that oil and gas w ould go back up in time to prevent some of the problems that were going to escalate from that.

I think that hindsight is a wonder ful t hing, and I’m not going to g o back and t ry and second-guess them, but I can tell you this: when I ran in 1993, it was to get rid of the deficit and deal with the debt a nd no more of any more wishful thinking that you can live on tomorrow’s dollars on the backs of your children. It’s absolutely unacceptable to me. The Deputy Speaker: We’re ready for the next speech. I’ve got a couple of people who have indicated. One was Edmonton-Glen- garry; another one i s Edmonton-Mill Woods. Fol lowing Airdrie- Rocky View then we would go to Edmonton-Glengarry. No? Mr.

Bonner: I will speak, Mr. Speaker, but when I rose earlier, it was to ask a question which was not appropriate at that pa rticular time. The Deputy Speaker: Okay. The hon. Membe r for Edmonton-Mill Woods, f ollowed by the hon. minister. Dr. Massey: Thank you, Mr. Speaker. It’s a pleasure to see Bill 2, the Financial Statutes Amendment Act, 2003, before the Assembly this afternoon. It’s a good idea, and I guess it doesn’t really matter where it came from. The fact that it’s here and will be of a benefit to all the citizens in this province is good enough.

The fund is a recognition of the cyclical nature of our economy. In 1999-2000 50 percent of the province’s income was made up of personal income tax, corporate income tax, oil revenues, natural gas revenues, and the sale of Crown leases. That’s a huge amount of the income of the province that is very vulner able to t he kinds of economic conditions that prevail in the province or in the country at any particular time.

So I think the bill is a recognition that we do have an economy that has great swings in terms of revenues, and this is an attempt to try to smooth out some of the ups and downs in that revenue stream. 3:40 The most important part, of course, and the reason for the bill is that it will allow the government to sustain investments. There were investments in public hea lth care, investments in education and in children’s services. I know that there’s always great debate in th e Legislature about som e of thos e pr ograms, and I hear often a question asked with respect to education, and that’s: how much is enough?

It seem s to me tha t some pe ople have thrown up thei r hands and have said: you’ll never have enough; no matter how much we put into it, we could always put more. And that’s true. I think there are some ways around that, but that is true. We’ve made great progress, and we’ve come to expect that there will be continual progress in areas like health care and education. We can all walk into schools and look at the kinds of conditions that are there and c ompare them to our own experiences as youngsters and say: things are pretty darn good when you walk in and look at them. And that’s true.

But the progress that we’ve made was hard fought for. It was hard earned, and the red uctions thus f ar, for instance, in class sizes, the innovations in terms of technology, the great improvements in terms of the preparation of teachers have all been hard-fought-for improvements, and they’ve been expensive. So I think wha t bothe rs people who are associated in t hose areas is

February 26, 2003 Alberta Hansard 155 when they see that progress being lost or they see that progress slipping, and I think that has been a problem the last 10 years. Hopefully, this bill that’s before us now will go so me ways to making sure that that doesn’t happen in the future, that the gains that have been made, the lev els of s ervices that have b een established will have some chance of being sustained when there’s a downturn in the economy, and it’s not a question of if there will be a downturn in oil prices; it’s a matter of when.

Look back at the history of our province and you can quite readily predict that there is going to be a downturn, and this fund, when that downturn happens, will be a bit of a saf ety net for prog rams that we a ll value but primarily those ones that are concerned with human services. The volatility of the province is really, as I said, quite wide. As a percent of total expenditures, 70.7 percent of revenues has been the range in terms of that volatility, and that’s quite a wide r ange an d can have a huge impact on budgets.

I think of the cu ts that were instituted – was it last fall or the fall before? – and how devastating they were, and it seems that that kind of scenario will be avoided in the future when the fund is firmly established. I would like to see some other things done in conjunction with the stability fund, Mr. Speaker , an d that’s the way, for instance, that education is funded.

The histor y of f unding in th e provi nce and certainly the way we did business when I was a school trustee was to look at economic conditions and to look at the avai lable money and then to try to make some judgment, some calculation in terms of how much should be put into the budget. I can think of the years on the board where we went everywhere from a zero percent increase in the year’s budget to one year I think our increase in the budget was 18 percent. Huge, huge variations, and it makes planning over the long term very, very difficult.

Once you have a year of 18 percent and all the growth that comes with that, how do you sustain that the next year if there is a slowdown of the economy and you can’t go to the community for additional revenues? It’s the kind of budgeting that we have grown up with in the province a nd still practice to a great extent. At budget time there’s always a quick calculation of how much money has been added in various departments and then judgments made about whether that’s enough or not enough.

I’m hoping that there can be an attempt at some proposals to go wit h the stabil ity fund that would bring some stability to the allocating of funds within particular departments. I look at some of the work that’s being done in other jurisdictions with respect to education funding and the whole notion of adequacy funding. I thin k it’s an unfortunate choice of terms, but adequacy funding is reall y a propos al to ma ke sure that there are ad equate funds to educate all children well. There are, I think, some really prom ising plans.

I’ve looked in some detail at the Oregon plans, and I’ve looked briefly at the plan in Wyoming. I think they’re the only two that are really in opera- tion, but they have brought great stability to budgeting in those two jurisdictions. What they have done i s looked at an elem entary school and, in Oregon’s case, a middle school and a high school and said: if we have an elementary school, how many teachers should we have? What’s the standar d f or teaching staff and the rat io of teaching staff to students? How m any librarians should we h ave? What kind of counseling service should we have in place?

What is a reasonable allocation per student for textbooks and for computers? They have developed fairly extensive lists of the very fundamentals that are needed to provide an adequate education so that all children may be educated well. It’s an interesting exercise that they’ve gone through. In Oregon they relied primarily on a group of experts to determine w hat level should be establi shed in eac h of their sc hools. Other states have approached it differently. Some hav e some rather sophisticated economic analyses that, I have to admit, sometimes defy understand- ing.

Others ha ve used e xemplary school districts or exem plary schools. They’ll go into a very high performance school, one that’s doing very well on a n umber of meas ures, look a t the kinds of resources that they have used to achieve those results, then use that as the standard in terms of financing other schools. I think there’s a great advantage to that kind of budgeting. We’re looking at how that might work in Alberta, working with some groups of parents to look at so me individual schools to see how that would ha ppen.

I gues s what I ’m arguing for is another form of stabil ity, one that’s based on expressed needs in schools. Interestingly enough, they tie the needs to performance objectives, and if I rememb er right, the O regon m odel ties i t to young sters achieving 90 percent i n mathem atics and 90 percent in reading scores. There’s a performance level that they have set for each of these schools that the intended resources are supposed to help them meet. So I think that this is really a good first step in terms of bringing some stability .

I think there c ould be more done in term s of individual departments so that there would be some predictability. One of the reasons some people refuse to get involved in it is that I think it could be v ery expensive initially. I looked a t the Oreg on budget, and they had to increase their education budget by close to a billion dollars to put the plan in place, and I think that would scare anyone off, but if nothing e lse they have a s et of goa ls to work towards. Some day when they do have the resources they can reach those goals. 3:50 Again, as I said, just one more piece of stability.

What we have in front of us is an important piece and certainly the base piece that we need. It’s a good move o n the part of the gove rnment, and I’m delighted they’ve decided that they’ll proceed with it. Thank you, Mr. Speaker. The Deputy Speaker: Comments? Questions? The next speaker, then, is the hon. Minister of Human Resources and Employment. Mr. Dunford: Thank you. Mr. Speaker, one of the highlights of my political career was standing on the steps of the Legislature while the Premier and the then Treasurer took great big scissors and chopped through a mock-up of a credit card.

I forget whether it was Visa or MasterCard – it d oesn’t really matter – but it was a symb ol of the fact that we had achieved a milestone in Alberta. When some of us arrived here in 1993, there were others perhaps such as yourself who were already here and wanted us to come and join the battle that you were fighting, and that was, first of all, of course, to get rid of deficit but then start doing something about the debt. So the milestone that was achieved and the sy mbolism that went with that particular ceremony was that net debt had been reduced to zero.

If we want to associate a budget of a government as similar to a household budget, basically, then, at that moment in time the Alberta government had cleared up all o f its cr edit card de bt and was simply left w ith liabilities that were covered by an asset. So to use m y homespun analogy, then, all we had left was the mortgage.

Now, at that c eremony I kept think ing: won’t it be won derful when we can stand outside on the steps and the Premier and whoever the Treasurer will be at tha t particular time – and I wa s hoping it would be the Member for Calgary-Foothills, because that gives you maybe an indication of where I’m going timewise here – will be able to draw up some kind of symbolic mortgage? I don’t know what

156 Alberta Hansard February 26, 2003 we’d have to do with the fire regulations around the city, but we’re good friends of firefighters, so maybe we could have lots of firefight- ers around and we could burn this mortgage. I’d been really hoping that this would’ve been done in, you know, 2001, or maybe it would be 2003. I was hopeful for 2005, but as I look at the reasoning for Bill 2, I have to tell you that my f eelings are ambivalent because clearly within the context now of Bill 2 we’re not going to be able to achieve zero debt by 2005. I heard an hon. member say: well, maybe.

And I haven’t given up on the maybe either, but I was very, ve ry hopeful at one time that this was going to be achievable, and now it looks like it’s dimming. I want everybody to understand that I understand the reasoning for it. Albertans, just a great bunch of people that we are, that we represent, are enthusiastic, are motivated, but also have expectations that over the years have always been allowed, I think, to be met.

There was a question earlier today f rom one of the opposition members to one of our members basically asking and, of course, inferring that it was our government that had gotten the province into all of this debt. So if all we were interested in was political labels, then one might be able to say: well, yes, it was a Pr ogressive Conservative government. There’s no question about that. But I had asked basicall y that same question not t o a current member of the government but to a past mem ber, and I w ondered: how did Conservatives ever get themselves into that kind of a situation?

The past MLA that I aske d said: go t o the Speec h from the Throne of 1983. I’m not here to throw stones at anyone, but I heard Premier Getty’s name mentioned, and I think he inherited so