1987 Legislative Session: 1st Session, 34th Parliament

HANSARD

The following electronic version is for informational purposes only.

The printed version remains the official version.

Official Report of

DEBATES OF THE LEGISLATIVE ASSEMBLY

(Hansard)

TUESDAY, JUNE 30, 1987

Morning Sitting

[ Page

2135 ]

CONTENTS

Routine Proceedings

Miscellaneous Statutes Amendment Act (No. 2), 1987 (Bill 42). Hon. B.R. Smith

Introduction and first reading –– 2135

Miscellaneous Statutes Amendment Act (No. 1), 1987 (Bill 31). Committee stage.

(Hon. B.R. Smith) –– 2135

Mr. Cashore

Ms. Edwards

Mr. Clark

Hon. Mr. Couvelier

Mr. Sihota

Mr. Blencoe

Mr. Rose

Mr. G. Hanson

Mr. Lovick

Mr. S.D. Smith

Mr. Stupich

The House met at 10:04 a.m.

Prayers.

Orders of the Day

HON. MR. STRACHAN: Committee on Bill 31, Mr. Speaker.

MISCELLANEOUS STATUTES

AMENDMENT ACT (No. 1) 1987

The House in committee on Bill 31; Mr. Pelton in the chair.

HON. MR. STRACHAN: Mr. Chairman, regrettably the

Attorney-General (Hon. Mr. B.R. Smith) is a little bit late and we have

a message, so I would ask for the committee to rise, report progress

and ask leave to sit again. My apologies.

The House resumed; Mr. Speaker in the chair.

The committee, having reported progress, was granted leave to sit again.

MR. SPEAKER: When shall the committee sit again?

HON. MR. STRACHAN: With leave of the House later today, Mr. Speaker.

Leave granted.

Introduction of Bills

MISCELLANEOUS STATUTES

AMENDMENT ACT (No. 2), 1987

Hon. B.R. Smith presented a message from His Honour the Lieutenant-Governor:

a bill intituled Miscellaneous Statutes Amendment Act (No. 2), 1987.

HON. B.R. SMITH: I move that the bill be introduced and read a first time now.

Mr. Speaker, this is Miscellaneous Statutes Amendment Act (No. 2),

1987. It has some specific provisions in it which will be of interest,

I think, to the House. Small claims court is going to increase its

jurisdiction from $2,000 to $3,000, which will allow that court to deal

with more commercial business.

There will be amendments that respond to recommendations of the

Wilderness Advisory Committee and will amend the boundaries of certain

provincial parks — not in the South Moresby chain.

There will be amendments to the Police Act which will increase the

number of police commissioners, so that they will be able to deal with

complaints against municipal police constables pending the passage of a

new Police Act.

There will be a number of amendments to the small business capital tax act

to enhance the operation of venture capital corporations and to expand a source

of equity capital for small business.

Of particular interest, the province is going to get tough with

careless drivers and with excessive speeders by establishing minimum

$100 fines for these serious motor vehicle offences. We're going to

move back to fines only for the serious provincial driving offences.

But for careless driving, the old "careless" or "without due care and

attention," not only will the fine be a minimum of $100, but people

will have to go to court to deal with that. They will not be able to

just deal with it aseptically by a traffic violation notice. For

excessive speeding, the minimum fine will be $100 and there will be

provision to take those people to court, although normally they won't

be; they'll be able to pay their fines and go by the ticket route.

Excessive speeding is speeding more than 40 kilometres above the speed

limit; so we're talking about fairly major breaches.

There are other provisions here that deal with the government's

administration of the aquaculture industry. There are a number of

housekeeping measures as well.

In this briefest of introductions, I'll be pleased to provide

further information when the debate in committee arises. So without

further ado, I move first reading of the bill.

Bill 42 introduced, read a first time and ordered to be placed on

orders of the day for second reading at the next sitting of the House

after today.

HON. MR. STRACHAN: Mr. Speaker, I'll try again. I call committee on Bill 31.

MISCELLANEOUS STATUTES

AMENDMENT ACT (No. 1), 1987.

The House in committee on Bill 31; Mr. Pelton in the chair.

section 1.

MR. CASHORE: Mr. Chairman, I notice under the explanatory

notes that this

section 1 is under the Minister of Social Services and

Housing (Hon. Mr. Richmond). I wonder if I may be advised to whom to

address any questions.

Interjection.

MR. CASHORE: To the Attorney-General. Thank you.

Mr. Chairman, when we look at

section 1, some parts of it I can

understand; other parts I find it a little difficult to sort out. Now

if we look at sections 4(a), (

b) and (c), there is the issue of the

identity of the adopting parent again being shielded. In fairness, why

would not the identity of the natural parent also be shielded, assuming

that given the adoption registry that was passed the other day, part of

the philosophy underlying that is a consensus philosophy among the

different people who participate in that process by agreement? I'm not

sure that I can understand this inconsistency.

HON. B.R. SMITH: I don't understand what you mean at all.

This amendment in

section 1 is brought about as a result of a court

case. The Adoption Act, as it always has been.... It doesn't give the

father the right to consent to the adoption of his child. If the child

was born to a woman whom the father was not married to, only the

mother's consent was necessary. There was a B.C. Supreme Court decision

in December 1986 which held that under the Charter that

[ Page 2136 ]

was not good enough — that the natural father's consent was

something that had to be dealt with as well. A putative father is now,

under this amendment, going to have the right to consent to the

adoption of his child.

The rules of court require that notice has to be served on the

parties affected when application is made to dispense with consent. An

application to adopt cannot be made separate from the application to

dispense with consent under the rules. So the amendments that you

referred to in

section 4 provide for an application to dispense with

consent, which can be made separate from the application to adopt.

This ensures that the confidentiality of adoption is not breached.

We're not doing anything to alter those categories of confidentiality

in adoption by this. It doesn't affect that at all. I think you're not

reading that the right way. If you could give me again what your

concern is....

MR. CASHORE: I understand the point the Attorney is making

with regard to this being very appropriate in terms of following up on

the result of the case cited. It seems to me, though, that in the

drafting of the legislation, provision is made for the protection of

the identity of the adoptive parent. It would seem to me that, in

fairness, if there is to be consistency in the drafting of such

legislation, courtesy should also be provided for the natural parent.

Perhaps the Attorney could tell me where it is provided for the natural

parent.

HON. B.R. SMITH: The confidentiality is in the old act, not

the parts we're amending. There is full confidentiality as to the

identity of natural parents and adopting parents, and that cannot be

released at all except by order of the court or under the written

instructions of the superintendent or his solicitor. There has been no

alteration to that at all. That's always been deeply embedded in the

law: natural parent, adopting parent — absolutely confidential. You

can't reveal that. They're both protected.

[10:15]

Sections 1 and 2 approved.

section 3.

MR. CASHORE: Mr. Chairman, I wonder if we could refer to (1.1)(c): "a man who is or was the guardian of the child's person or

joint guardian of the child's person with the mother." What exactly

does "guardian" mean here?

HON. B.R. SMITH: It means the person who either by an

instrument or by an order of the court is the guardian of a child, not

just the person whose care the child is in. It would have to be a

lawful guardian. Guardianship is sometimes conveyed by an instrument,

by the natural parents creating somebody as guardian, or it may be

created by a court order. But it would have to be a lawful guardian.

MR. CASHORE: Thank you for that answer. That clarifies my

concern, because for a person not trained legally, one might assume,

without a legal definition, that "guardian" could even refer to

somebody who had provided a roof or something like that. So I appreciate

that it must be a court ordered definition.

Section 3 approved.

section 4.

MR. CASHORE: As I understand it, Mr. Chairman, this would

mean that a child between the ages of 12 and 19 would not be able to

revoke consent, having given consent. I would think that this would be

discrimination and also an unnecessary discrimination. I understand

that there really can be a problem — partly a bureaucratic problem —

when somebody becomes afflicted with the kind of ambivalence one would

often go through while going through this process. This is one of the

examples I would use to support what we have been calling for: an

infrastructure that would make sensitive and compassionate counselling

available to people of tender years who are going through this

difficult process.

I think that by passing this section, if it were to mean that the

child would lose the opportunity to change his or her mind, it would

really be very unfair and not in keeping with the spirit of the

legislation that the Ministry of Social Services and Housing has been

bringing forward, along with the Attorney-General, to update adoption

law in this province at this time.

I have been discussing this with a lawyer this morning, and unless

the minister can assure me that this is not the case, I would like to

ask the minister to consider withdrawing this

section and possibly

bringing it forward in some other form at another time.

HON. B.R. SMITH: This

section has nothing to do with the

revoking of a consent by a child over 12. What it does is ensure that

wherever a parent voluntarily relinquishes a child to the

superintendent for the purposes of adoption — that is, as opposed to

having the child apprehended or a protection order being made — the

superintendent then become the child's legal guardian.

The court decision in 1986 that I referred to in December put the

child's legal status in some doubt prior to the completion of the

adoption. That's the reason for the amendment. It has nothing to do

with what a 12- to 19-year-old can do with regard to a consent already

given. Presumably if a child of 14 gave a consent and then changed his

mind as to that consent, he could be heard before the adoption was made

as to why he wished to withdraw his consent. It would be good reason

that he was under duress, that he didn't understand the nature of that

consent or he hadn't been given free and independent advice. That's

totally open to him; 8(9) has nothing to do with that.

MR. CASHORE: Mr. Chairman, I can only say that I had a legal opinion this morning that would not agree with the minister on that point.

In the Adoption Act, as

section 8(9) presently reads:

"Where a child is voluntarily surrendered to the

superintendent for an adoption consented to under this section, subject

to subsection (7), the guardianship of the child is transferred to

the superintendent, in respect of the person of the child, and to the

public trustee, in respect of the estate of the child."

This amendment would remove the words "for an adoption consented to

under this section, subject to subsection (7)." The opinion I received

was, given this change, that a child having become the ward of the

superintendent would no longer have the right to revoke that consent

because of being the ward of the superintendent. That is tantamount to

the child being the superintendent's, the superintendent having

[ Page

2137 ]

all the rights of a parent over that child. Those rights would therefore supersede the rights of the child.

The legal opinion I have is that this would in fact revoke the right

of the child to change his or her mind, that child having been

transferred to the care of the superintendent.

I think, Mr. Chairman, that it might be wise at this point to set

this

section aside to be able to have an opportunity to review this

wording and to make sure that the point I am raising is adequately

covered. I cannot imagine, given the amount of legislation that has

been achieved on this subject during this session, how this one short

section would hurt the entire package. I'm sure it would not hurt the

entire package, and I think it would behoove us, in our wisdom, to set

it aside for the time being.

HON. B.R. SMITH: Certainly I don't mind standing it down to

the end of the bill, but it's not really a material point. It's more of

a legalistic point, because this child has been surrendered by his

parents to the superintendent. If a consent to adoption is signed prior

to that time, the adoption consent can always be withdrawn, if shown to

be in the best interest of the child. Any consent under the act can be

withdrawn. Also, at the stage that this amendment clicks in, there's no

adopting family there sort of on the horizon. You're talking about the

delivery by the parents to the superintendent, and what you're trying

to do is get guardianship established so the superintendent has some

clear lawful rights for that period. You don't have adopting parents in

the picture. They'll come in the picture later. So there may be some

legal problem that the absolute, unfettered right under 8(7) has gone,

but I don't know that it has any practical consequences.

Out of an abundance of caution, let's stand that

section down. When

I get spelled off by one of the ministers specifically charged with

other parts of the bill, I'll try to get back to see if I can reassure

you some more.

MR. CHAIRMAN: The operative word here, under standing order 84, hon. members, is "postpone." Is it agreed that this

section be postponed?

SOME HON. MEMBERS: Yes.

section 5.

MR. CLARK: I have a question for the Minister of Finance and

Corporate Relations on

section 5, which, as I understand it, is a small

amendment that removes "at the request of the Crown or a municipality."

Maybe the minister could first inform the House what the motivation for

this change is.

HON. MR. COUVELIER: Mr. Chairman, this amendment removes an

existing restriction permitting the Assessment Authority to sell

technical or professional services only to a Crown corporation or a

municipality. The change will allow the authority to sell such services

to the private sector, thereby providing it with the ability to

increase its own revenue. The dissemination of confidential information

will not be affected by this change; it will continue to be tightly

controlled by existing sections of the Assessment Act.

MR. CLARK: You're allowing it to act more like a Crown corporation

in terms of making some more revenues through the private sector. What kind

of services would it perform? In other words, could the Assessment Authority

do assessments like a private sector assessor? Is that how it would work?

HON. MR. COUVELIER: No, Mr. Chairman, it would not be

providing new services to the private sector. What it would be doing,

though, is making available to the private sector, on payment of a fee,

its broad data base, which at the moment is a matter of public

information but is not so readily available. It is common practice in

many municipalities — my own municipality of Saanich being an example —

whereby the data base of the Assessment Authority is provided on the

public counters for real estate agents' and solicitors' use, as a

public service. This would allow us to create a data bank that could be

accessed by registered users from their own places of business, and

thereby provide a source of revenue to the Assessment Authority, and

thereby reduce its costs of operation, and in that process reduce the

public cost to the taxpayer at large.

MR. CLARK: That being the case, it sounds like a reasonable

objective. So would the notion be to set up a computer data bank that

you could access through computer, or would it be essentially charging

a fee for something which already exists in some municipalities? In

other words, would there be over-the-counter access to information for

a fee, or would it be more of a centralized mechanism?

HON. MR. COUVELIER: It's proposed to be a centralized data

bank that can be accessed by modem from users who are preregistered,

prescreened, and would be charged a monthly fee for the accessing.

MR. SIHOTA: I have another question of the minister. The

intent here is not to prohibit or in any way prevent an individual who

wants to go, let's say, to Saanich or to Esquimalt municipality and

secure that information. It's not as if that information will be sold

to municipalities and they have to pass on the costs. We're not talking

about that kind of a situation. That information will still be free for

those who want to take the time to go down to the municipal offices and

pick it up. Is that correct?

HON. MR. COUVELIER: Yes, that's correct. That is to say, the

structures in place and utilized by the trade would continue unfettered

and unaffected, although it is true that the availability of this

service will likely, I suspect, reduce some of the use that's presently

made by the public of those records at each municipal hall. For those

who use the service on a regular basis, this will be much more

convenient than the traditional style of making a personal appearance

at the municipal hall.

MR. BLENCOE: I just listened to this discussion in my office,

Mr. Chairman. Is the minister saying that the information in the

Assessment Authority data bank that he is going to make available for

fee is the same information that's currently available at some

municipalities, or is additional information going to be provided?

HON. MR. COUVELIER: It will be the identical information.

However, it is true that our ambition is to continue to refine the data

bank so that it is more useful still to potential end users. I wouldn't

want the member to feel that we were

[ Page 2138 ]

limiting in any way our ambitions. We consider, with the Assessment

Authority, that we are a public service, and there is no reason we

shouldn't be making every effort for the public to utilize our services

more efficiently and at less cost to themselves.

[10:30]

MR. BLENCOE: What you're saying is that those who are

informed and know where to go can still get the information free, but

if you want quick access you're going to have to pay for it.

HON. MR. COUVELIER: That is correct.

MR. ROSE: Just on the same subject, right now you can go down

to the Assessment Authority and look at the book or the roll — or

whatever you want to call it — if you need to. Will this provide for

printouts? The other question is: what level of confidentiality is

maintained in this? For instance, if I had enough money, could I ask

for and receive the roll?

HON. MR. COUVELIER: The existing printout system would remain

in place, and that is what is conventionally used by most

municipalities and offered on their counters as a piece of public

information. That will not be affected. I can't tell you whether the

staff have developed a printout-by-modem system that would provide

printouts in the offices of the solicitors and the real estate agents,

but I suspect that's not of interest to you in any event.

We're not talking about expanding the information into areas of

confidentiality. That clearly is protected under the Assessment Act,

and we certainly would not intend to violate that. The purpose and

motivation here is purely and simply to provide ease of availability

for those who use this information on a regular daily basis. Those of

us who have municipal experience know that it's customary to have at a

counter, all day long every day, three or four individuals at a time

looking at the printouts. If those same individuals could sit in the

comfort of their offices with their own files handy, it obviously would

be an advantage — a benefit — to them. It is really at the request of

the trade, who have inquired as to whether we could make this

available, that we are responding.

When we learned of the interest in the availability of this

information, we decided we would tell the staff and challenge them to

refine the system further if they can and add any other wrinkles. For

example, there is no good reason why that same data bank should not

contain zoning information. That's not purely a matter of Assessment

Authority business and is beyond their interest, but it certainly is

not beyond the interest of those people who would want to use this. It

would save them going to the zoning maps of the municipality to

determine the status of a particular property. So with one inquiry into

the system they would be able to determine ownership, address, property

description, property size, tax roll information in terms of dollars —

this year, last year. If we can add to that data bank further

information, such as zoning, such as restrictions that may be imposed —

height restrictions, view restrictions — all of that kind of

information, you might easily understand how valuable a tool this might

become and, therefore, the private sector's willingness to pay for it.

MR. G. HANSON: So the Minister of Finance is saying that this

amendment would then allow companies, marketing firms, the real estate

industry, insurance corporations, to buy bodies of assessment data from

the Assessment Authority. Is that correct?

HON. MR. COUVELIER: To the extent that that information is

presently available, the answer is yes. But we clearly are not talking

about expanding into areas of confidentiality, which are set out in law

under the Assessment Act,

section 15(2)(

a) and (b).

MR. G. HANSON: We don't want to belabour the point, but we

also want to be confident that the public interest is well protected in

terms of the kind of information that could be made available. There

could be large marketing companies in New York, for example, that might

like to buy all of the assessment records to analyze for a marketing

program in the city of Victoria. We're concerned that the public may

not wish that information to be made available. Can you expand a little

more on your intent here?

HON. MR. COUVELIER: Mr. Chairman, the information that we're

talking about is already a matter of public record. It is available

now, and anyone who wishes it merely has to go to either the Assessment

Authority itself — their local office — or else to their local

municipal hall. As the hon. member for Victoria would know, that

information is available at the counter without having to request it;

you just walk in the door and it's there in front of you.

What is required, of course, is to transcribe that data onto your

own information sheets. That is an unnecessary inconvenience, it seems

to us, to the trade who use it. It's time-consuming, and the staff have

to present themselves to the place of the Assessment Authority or the

local council for no good reason. It doesn't make a whole lot of sense

to have a document available to the public freely and openly and yet to

deny that same public the opportunity to access it from the comfort of

their own office.

MR. G. HANSON: Mr. Chairman, I certainly can't resist the

opportunity to say to the minister that he's making exactly the same

argument that the members of the public accounts committee make when

they want to scrutinize vouchers that are publicly available. But we

have to transcribe them by hand, and we have to sit hanging by our toes

in some room transcribing things by pencil when we could be examining

those expenditures in the comfort of our own offices, and doing a good

job on the public's behalf. So he's made that argument very eloquently

on behalf of industry or some interested party to access that public

information, yet members of the public accounts committee have

tremendous difficulty scrutinizing those same documents.

HON. MR. COUVELIER: Mr. Chairman, I have not had the honour

of sitting on the public accounts committee, so I'm unaware of the

machinations and mechanics associated with that group. Might I just say

that the question of "putting to good use" is a matter of personal bias

and personal

interpretation, so we might have different views about the

good use. Aside from that comment, I really have nothing further to add.

MR. LOVICK: Mr. Chairman, just a very quick question. I'm

wondering if there is presently established any kind of fee

schedule

that the authority is guided by.

[ Page

2139 ]

HON. MR. COUVELIER: No, Mr. Chairman, we have not yet

assigned dollar values to this service. For one thing, staff are in the

midst of assessing and determining the cost of adding certain other

pieces of information like the zoning and that kind of thing. Until we

get that total picture, we really don't know what our cost of service

would be. Suffice it to say that we're satisfied that there will be a

desire on the private sector to access it. It will have a value, and

this amendment will allow us to charge the private sector a

commensurate fee.

MR. LOVICK: To pursue that matter for a brief moment, Mr.

Chairman, I wonder whether the Minister of Finance and his officials

might consider the fact that perhaps, as written, this particular

section of the bill might centralize the authority rather too much

within the Authority and not allow the regional offices sufficient

latitude to respond to the market pressures and the demands that are

peculiar to their own interests and to their own communities. Is that a

consideration?

HON. MR. COUVELIER: That's a good point, Mr. Chairman, and we

are cognizant of the opportunity this presents to decentralize the data

bank information. Under the Provincial Secretary's ministry, we are

moving very aggressively in the area of building up a data bank at the

local government agents' offices.

It follows from that that those municipalities who would like this

service would also qualify for it. So we are, by virtue of

computerizing the government agents' offices, moving a great way down

that road of decentralized dissemination of information.

MR. BLENCOE: I have an interesting question for the minister.

I wonder if this is the first step to make this particular corporation

more attractive to the private sector — in putting in fee schedules. Is

this the start of a move towards privatizing the Assessment Authority

by making it more attractive to the private sector?

HON. MR. COUVELIER: That's an interesting thought, Mr.

Chairman; it certainly had not occurred to me. That motivation is not

one that excited me or my ministry. It probably is true that by virtue

of the thorough examination of privatization options presently in the

process in another ministry, this subject might get some general

discussion as it relates to the Assessment Authority.

For what my opinion is worth, may I just say that I am very

sensitive to the fact that the public expect that their monitoring

mechanisms and their policing mechanisms or structures or

organizations, which are set up for the purpose of equalizing treatment

among taxpayers, be operated by public servants who, at least in

theory, have an unbiased attitude towards their responsibilities and

therefore are less susceptible to some of the concerns that might arise

if the private sector looked upon this as a profit centre per se.

After all, it is a service to the public and it deals with public

information that can only be gathered by the public sector. It is the

public sector that does the assessing; it is the public sector that

sets the standards for assessment; and it is the public sector that

ensures that information is presented in a way which is fair and

equitable to all. It is the public sector and probably only the public

sector which can ensure there is a total provincewide standard upon

which all of these judgments about property valuation are made.

So in very general terms, then, I'd have to say that we are not

embarking on this initiative for the purpose of enhancing a

privatization opportunity, but rather merely one of providing an

improved level of service to the public and saying to the public that

improved level of service has a value, and we have been told by them

they are prepared to pay for it.

It seems to me we've got a perfect situation here. We've got the

public sector responding to the needs of the private sector, the

private sector agreeing to pay the cost of that service; and the wider

dissemination of the available information so that a greater number of

the public have it available to them at a minimum of inconvenience and

discomfort. It seems to me that those are all highly desirable

objectives and therefore beyond much criticism.

MR. BLENCOE: Mr. Chairman, I wasn't going to prolong this

debate, but I think we've touched on a very important issue, somewhat

by accident. I will put it on the record that when we get to the debate

in the fall vis--vis....

AN HON. MEMBER: The fall?

MR. BLENCOE: The new session in the fall. I scared everybody. The member for Kamloops (Mr. S.D. Smith) just saw the summer go.

When we get to the new session and we understand the major

legislation that could be coming forth on privatization, we certainly

will be calling upon the Minister of Finance to reflect upon the words

he has just shared with us, in terms of a classic example where the

participation of the public sector in a critical area is essential for

the protection of the public.

[10:45]

I was pleased to hear the minister's response, because we

understand, according to the Premier's agenda, everything is up for

grabs; everything is on the table in terms of privatization. The

minister has just given us a very good response to why we are very

apprehensive about this government's dogmatic philosophical position in

terms of privatization. We would look forward to the minister's

defending some of the corporations that we think are essential, based

upon the information that is gathered on behalf of the public for the

protection of the public. Absolutely. If the minister had given a

response this morning that he was thinking of privatizing the

Assessment Authority, there would indeed be real problems with that,

because you would have public information in private hands that could

be used in a very abusive way. So we will dig those comments out from

Hansard, and when the debate comes up in the fall session, we certainly

will be using them, because he has given a very good answer for

protection of public business, public corporations in the public

interest.

HON. MR. COUVELIER: Mr. Chairman, I have to make sure that we

keep on the public record here this government's view towards

privatization. The member used words to the effect that we have some

sort of preconceived, determined bias to move down this road. He

chooses to repeat the Premier's phrase, which is that everything is up

for grabs.

What the member has to do is put that comment in context. What this

government is doing is ensuring that every single operation of

government is examined in a free, untrammelled way, to ensure that that

examination comes up with as

[ Page 2140 ]

much factual data as possible before we deal with the question of

whether we will or won't privatize. If the member is suggesting that we

should do something less, that we should not embark on that examination

without all the facts, then I think that would be a pretty clear

indictment of the opposition's view about the seriousness of the matter.

Surely it's in the greatest public interest to ensure that the

privatization examination receives a very thorough, exhaustive

examination of its costs, its benefits, its impact on public service

and that kind of thing. All the Premier has done, with his comments and

by charging the hon. Minister of Intergovernmental Relations (Hon. Mr.

Rogers) with the task of examining privatization, is to ensure that

that study proceeds without any predetermined bias about whether it

will or will not be acceptable.

The data obtained from this examination will, in the fullness of

time, be made available to the government, and we will make a

determination as to what particular services, organizations or

structures might be further pursued for privatization. But you should

not read anything contradictory into what the Premier has done, in

terms of challenging one of my colleagues with a very exciting task, or

into my comment regarding the importance of providing a necessary

public service in a way that is without bias and without fear or favour.

MR. S.D. SMITH: Mr. Chairman, I wonder if the minister could

tell the House whether or not the municipalities, those corporate

entities all around British Columbia that get information from the

Assessment Authority now, pay for that information in the same way that

it is contemplated it would be paid for by others who might want to

access it on behalf of individuals for whom they may be acting, or who

may wish the information with respect to a real estate transaction

regarding their own home and so on. Do municipalities now pay for it?

If they do, what do they pay for it? And if they don't, is it

contemplated that they would be treated the same way as the private

sector entities in relation to the removing of this restriction?

HON. MR. COUVELIER: Good question; I thank the hon. member

for it. It's important to clear the record here. The information

presently available from the Assessment Authority is provided at no

charge to those people who wish to access it. To the best of my

information, there is no charge for making this information available.

It is true that some municipalities ask for enhancement of the existing

data and contract with the Assessment Authority to make some unique

calculations in the area, for example, of local improvement taxes or in

the area of special districts that might have some separate levies. I

do believe that for that kind of extra service which requires extra

programming, there might be a charge for the operation.

What we're talking about here is merely passing an amendment which

would allow the Assessment Authority to collect a fee for increased

availability and ease of use — an increased ease of use by those who

are interested, by individuals in the private sector. It may be that

some municipalities might also be interested in this comprehensive

service. However, the enhancements that I've talked about earlier,

relating to adding zoning information and that kind of thing, are

presently in the hands of the municipalities. After all, it is their

own creature. I suspect that many of them would not be interested in

contracting for a service that they presently have within their own

facilities anyway.

[Mr. Weisgerber in the chair.]

MR. BLENCOE: Just to conclude the discussion I was having

before the member for Kamloops rose on his feet, the reason.... I think

it's an interesting discussion this morning about privatization. The

minister thinks I'm putting words in his mouth and obviously comes to

the defence of the government. The reason we raise it, of course, is

that it may very well be that not all the members on the government

side are quite as rational and balanced as the Minister of Finance is

being this morning in terms of public assets. There may indeed be a

blind faith or zeal to follow the ultra-right in privatizing as much of

the people's assets as possible. We've seen this in other

jurisdictions, and we know that sometimes the intelligent, rational

approach is put to the bottom and the zealots win the day. So this

discussion this morning is extremely useful. We're very pleased that

the Minister of Finance is taking an intelligent, balanced and rational

view, and has put on the record....

Interjection.

MR. BLENCOE: Don't go too far? Ha, ha!

He has gone on the record as saying the Assessment Authority is not in the grab-bag for privatization. Is that correct?

HON. MR. COUVELIER: No, Mr. Chairman, that is not what I

said. The member should not exaggerate the spoken word. The fact of the

matter is, as I've said earlier, that my colleague has been charged

with the task of studying the issue of privatization in its entirety,

and in that examination he will bring forward to the government all of

the facts pertaining to all of the services we provide and all of the

opportunities that we have for privatization, either with Crown

corporations or with the provision of services to the public. Only

after all of that data is available to us will the government be in a

position to logically, rationally, calmly and unemotionally deal with

the question. It is a gross distortion for the hon. member to be

suggesting that we're embarked on this exercise with any great

preconviction about what we might do in the fullness of time.

I think it's important to recognize, Mr. Chairman, that in the

premier example of privatization that we have before us, in terms of

examples in other countries.... In Great Britain, for example,

privatization has been pursued with some vigour and with great success.

But in all cases that privatization was structured and built on the

concept that they had to be win-win situations: they had to be a win

for the public at large, for the taxpayer and for the employees.

Everybody under the process had to come out better as a consequence of

the decision. I do know that this government has that as one of its

basic precepts, dealing with the question of privatization: that is,

how we will judge the merits of the various proposals that will come

before us.

MR. CLARK: I just want to go back and clarify your answer to

the second member for Kamloops (Mr. S.D. Smith). Can the minister

assure the House that it's not the intention of this amendment to

charge municipalities for the central data bank service?

[ Page 2141 ]

HON. MR. COUVELIER: No, I didn't say that. I said that I

suspected that most municipalities would not be interested in

contracting for this data bank because they already have it in printout

form; and the enhancements we're talking about adding to it are already

in the hands of the municipality, in the sense that they themselves

determine how land use will be judged. They themselves put restrictions

on use of property — height restrictions, that kind of thing. So it

seems unlikely to me that they would be very interested in contracting

for this service. It seems far more likely that the private sector

would be interested in it. That's not to say that the information would

be denied to the municipalities. All I'm really saying is that if they

wish it, it's there, but that we believe there should be a recapture of

the cost of this information, and that's the intent of the amendment.

Sections 5 and 6 approved.

section 7.

MR. SIHOTA: Mr. Chairman, I believe it's the Attorney-General who is responsible for this one, not the Minister of Finance.

Interjection.

MR. SIHOTA: It's the Minister of Finance.

I think I understand the rationale here, but perhaps the minister

could explain to me once again the intent behind the waiving — of the

seize or sue provisions under the Chattel Mortgage Act. I was a little

surprised in some ways — if I look at it from one angle — to see this

section here. If I look at it from another angle, it makes a lot of

sense. I'm just wondering what the intent was in this case.

HON. MR. COUVELIER: Mr. Chairman, the addition of subsection

(3) to

section 25 allows for greater flexibility in establishing

remedies where terms of a separation agreement or a divorce order are

not complied with. At present, where a chattel mortgage is given by a

spouse on dissolution of marriage, if terms are not complied with, the

only options available are to seize the chattel or to sue. Where the

seize or sue provisions are voluntarily waived, a broader range of

options is potentially available.

A similar amendment is made respecting conditional sales agreements

under the Sale of Goods on Condition Act, and court orders respecting

chattel mortgages or conditional sales agreements under the Family

Relations Act. This option is available only to spouses upon

dissolution of marriage and requires a divorce order or written

separation agreement and a written waiver.

MR. SIHOTA: Could the minister please explain, Mr. Chairman, what he means by "a broader range of options is available"?

HON. MR. COUVELIER: I think I'll ask my colleague, the hon.

Attorney-General, to expand on that subject. He being certified to deal

with the subject and given the qualifications of the questioner, it

strikes me more appropriate that discussion on this technical point

might more properly be handled by those more qualified to deal with it.

MR. CHAIRMAN: Would the member care to repeat his question for the Attorney-General.

MR. SIHOTA: I asked the minister originally for clarification

of the intent of this section, and if I heard the minister right, he

said the intent was to eliminate the options to seize or sue. Putting

in subsection (3) allows a party to exercise a broader range of options

— I take it, upon default on the chattel mortgage. If that's the

rationale, I'm just wondering what the broader range of options is.

Obviously if there's default under a chattel mortgage, you have the

ability to sue for breach of covenant and you have the option after you

sue to seize upon an order.

The Minister of Finance — a little to my surprise talked about a

broader range of options that is available.... I'll wait for the

Attorney-General to return to let me know what those broader options

are — just for clarification.

[11:00]

HON. B.R. SMITH: I wasn't familiar with this section, but I

am advised that it only has to do with the relationship between husband

and wife, that it doesn't involve a default on a mortgage and the

rights of third parties, that it involves husband and wife. Where

husband and wife have entered into a different agreement or

arrangement, seizure cannot take place under the chattel mortgage. It

ousts the spouse.

MR. SIHOTA: Maybe I'm not understanding this then, because

the Attorney-General has interpreted it in a way different than I saw

it. If that's true, clearly it could make sense from one particular

point of view. What the Attorney-General is suggesting here is that if

a husband and wife execute a chattel mortgage during the course of

their marriage, then there's a dissolution of the marriage — either by

way of a separation agreement or a court order under

section 52 of the

Family Relations Act — the third party cannot execute on default by

seizing or suing? That's almost what I interpreted the

Attorney-General's comment to mean, and that strikes me as a little

awkward. Or, alternatively, is it a case of spouses...?

HON. B.R. SMITH: I guess the confusion here is that these

words have to do with an interspousal mortgage. You're talking about a

chattel mortgage given by the spouse, and so we're not talking about a

chattel mortgage that the couple had where a third party has rights.

That's not affected. You're just talking about an interspousal chattel

mortgage.

MR. SIHOTA: That was my original

interpretation until the

last comment. Let's move on from there. Let's take the case of a

husband and wife engaged in a chattel mortgage: there is a separation

agreement, the wife takes out a chattel mortgage, say, on a car or

something like that, and there is a default. The husband would have had

the opportunity to seize or sue. Now, according to the Minister of

Finance, there is a broader range of options that are open to the

husband.

It strikes me that if there is — and I am just quoting the Minister

of Finance on that — a default on that chattel mortgage, your only

option is still to sue under the covenant, and I take it that then the

intent here is to eliminate the immediate provision to seize.

HON. B.R. SMITH: I think "broader range of options" means that you could not only seize or sue, but you could

[ Page 2142 ]

seize and sue. That's all that that meant. If you voluntarily waive

the seize-or-sue provision, then you're left with the broader option of

both seizing and suing. You could seize the goods and you could sue.

That option is available only to spouses on the dissolution of a

marriage and would require a divorce order or a written separation

agreement and written waiver.

It's a very specialized thing available only where one spouse has

given a mortgage to another, available only where there is a divorce or

a separation agreement and where there is a written waiver. It doesn't

have broader implications beyond that.

MR. SIHOTA: Once again, I don't have the benefit of the

advice that the Attorney-General is getting, and I'm having some

difficulty now in thinking this thing through. What you're saying now

is that those spouses will have greater powers than they do under the

Chattel Mortgage Act. Under the act, you can seize or sue but you must

elect your remedy,

whereas under this provision in the interspouse you

have the option of doing both, which strikes me as somewhat peculiar.

I am still trying to understand what the public policy argument is

in terms of giving a spouse the ability to do both when there are

restrictive powers under the Chattel Mortgage Act where you had to

elect your remedy. I'm having some difficulty understanding the

thinking behind the seize-and sue option instead of the seize-or-sue

election.

HON. B.R. SMITH: Stand it down, and then come over here and we'll talk about it.

MR. SIHOTA: That's fair enough.

MR. CHAIRMAN: Pursuant to standing order 84(2), we'll postpone this section.

section 8.

MR. LOVICK: Just a very quick question, Mr. Chairman, and

perhaps directed to the Minister of Health. Could he explain, please,

the genesis of this particular change? Is this the result of some kind

of representation on the part of a profession? Is that the case?

HON. MR. DUECK: Yes, it was. As a matter of fact, it is just

house cleaning, because nurses don't practise as chiropractors, and

we're just putting it in the act.

MR. CLARK: So you're saying that currently under the act —

without this amendment — nurses can perform chiropractic services and

charge a fee?

HON. MR. DUECK: Technically yes, they could, although they

haven't practised chiropractic. But it has been brought to our

attention by the nurses' association, and we thought we should clean it

up.

MR. LOVICK: This seems to me an eminently desirable thing,

and I'm delighted that the ministry has been responsive to the

profession. I only hope the ministry will be similarly responsive to

all of those representations now before it from their counterparts:

namely, the physiotherapists and massage practitioners, who obviously

have similar concerns. I hope the minister will indeed, as I say,

respond in similar fashion.

Section 8 approved.

section 9.

MR. CLARK: Could the Minister of Finance just explain the purpose of this amendment?

HON. MR. COUVELIER: The purpose of this amendment is to

clarify the definition of a commodity futures contract and to explain

that it applies only to certain types of contracts traded on a

commodity futures exchange. There has been some confusion in the

industry as to whether commodity forwards contracts are included in

this definition. So it's really only a clarification.

Section 9 approved.

section 10.

MR. LOVICK: I don't think

section 10 is a problem, but

certainly it causes some concern because the reasoning behind the

change isn't entirely clear to us. I understand, from the explanatory

note, that we're talking simply about getting rid of obsolete

provisions. We're wondering, however, if there is indeed more of an

explanation than that, and I would invite the minister to share with us

the rationale for the change.

HON. MR. COUVELIER:

section 1(l)(

c) of the definition of a

reporting company includes a corporation that, with respect to any of

its securities, delivers a prospectus that is filed and accepted under

the Real Estate Act. As a result of recent amendments to the Real

Estate Act and the regulations, this clause is now obsolete.

MR. LOVICK: Is it not the case that the Real Estate Act,

consolidated effective April 1986, still makes extensive provision for

prospectuses?

HON. MR. COUVELIER: Yes, that is correct. It is the case.

MR. LOVICK: Again, I ask the question simply for purposes of

clarification: if that is the case, can we present the same argument

about obsolescence? If in fact the Real Estate Act as consolidated

still makes those provisions for prospectuses being filed, then does

the argument about obsolescence still hold?

HON. MR. COUVELIER: We're having some trouble going through

all of the amendments of the act to give you the specific answer. I'm

wondering if, similar to a previous clause, you might want to stand

this down until after the other sections are dealt with.

MR. CHAIRMAN:

Section 10 is postponed.

HON. B.R. SMITH: If I could just revert to

section 7, which we stood down and which the member for Esquimalt-

[ Page 2143 ]

Port Renfrew and I had some discussions about, he may want to speak on that now. We can probably deal with that.

section 7.

MR. SIHOTA: After a discussion, I have a better understanding

of what this

section is all about. I'm sure that's the case with the

Attorney-General as well. I want to thank the legislative drafters for

talking about this

section and explaining it to me. We're quite content

to allow it to pass at this stage.

Section 7 approved.

section 11.

MR. SIHOTA: I take it it is the Attorney-General once again

who is in charge. This is a section, if I read it properly, that deals

with the requirement of juries, and I guess I'd like first of all to

start by asking the Attorney-General what the intent was with respect

section 11. Is it the intent of the changes contained in

section 11

to take away a jury for these types of matters?

Just for the Attorney-General's information, I do have

section 22. It says:

"If, before proceeding to make an inquiry without a

jury under

section 21, or in the course of holding the inquiry, there

appears to the coroner, from the information furnished to him or from

the opinion of any medical witness, to be any reason for summoning a

jury, the coroner may, and shall where there appears to him to be any

reason to suspect that the deceased died by murder or manslaughter,

proceed to summon a jury in the manner required by this act."

So it used to be mandatory, where there was murder or manslaughter,

to summon a jury. It's no longer the case that that be done. As I read

it, the intent then would be to make it an option instead of making it

mandatory. Am I correct on that?

[11:15]

HON. B.R. SMITH: This would remove the requirement for a

coroner to hold an inquest — that is, to actually summon a jury — where

he has reason to suspect that murder or manslaughter has been

committed. That, together with the companion amendment — the next one,

section 23 — arises because of the serious problems that we have in

going through full inquests today when there is a criminal

investigation taking place and the decision really has either been made

or is about to be made to lay criminal charges. You then get into a

clash between the coroner's court and the criminal court, and you get

problems not only in questioning a person who may become an accused,

but you often get applications being brought in superior court to try

to hold the inquest proceedings in abeyance. It is our experience that

with the state of criminal investigation and the complexity of it, you

don't want to always be in a position where in every case of a

suspected murder or manslaughter an inquest simply has to go ahead. It

may be that the best thing to do is to lay criminal charges.

In terms of the Charter and the arguments that are being made,

that's what we will have to do. So it provides the non-mandatory

provision, that's all. It doesn't stop you doing it; it just makes it

non-mandatory to do it.

Sections 11 and 12 approved.

section 13.

MR. SIHOTA: Just to confirm this, both sections 8 and 9 are there at the request of the judiciary?

HON. B.R. SMITH:

Section 13 of the bill substitutes the new 8

and 9, the powers of the Chief Judge and the administrative judge,

which are both at the request of the judiciary, that's right. There is

a person now who fills the position of Chief Judge of the County Court

but doesn't have that position authorized by statute; so that person

does the work but doesn't have the authority. For several years the

request has been made by the Chief Justice to have that position put in

the act. So we're carrying out that request, hon. member.

Sections 13 to 15 inclusive approved.

section 16.

MR. SIHOTA: Mr. Chairman, I had to chuckle when I saw this

section, because I'm sure the Attorney-General knows as well as I do

that there seem to be some people who are habitually before the courts

on cases that really are irritants to the judiciary. There's always

this tension between the need to ensure that people have access to the

courts and have their day in court, and the desire to put aside

frivolous cases. I'm not sure what prompted this section, because we do

have the ability of the courts....

MR. WILLIAMS: I think a general strike did it!

MR. SIHOTA: I'm sorry. I was wondering what the chuckling was

back here, and I must confess I have to chuckle even more because

somebody could have used this in the case of some recent instances that

were before the courts. But we do have the Supreme Court rule right now

which deals with frivolous and vexatious cases. Of course, one can

bring in an interlocutory application to seek an order from the court

that the application is frivolous and vexatious. That's the way we've

traditionally dealt with them. I haven't dealt too recently in the

courts with a frivolous application. I think it must have been a year

or so ago; I don't know if the law has changed substantially in the

past year. But I wonder why, given those rules that already exist under

the Supreme Court, we would need to make the amendment to add

section

29.1. I know the problem, but the rule is already there — rule 5, I

believe, of the Supreme Court rules. I could be off on that, but we've

already got it, so why do it here?

HON. B.R. SMITH: We have it in the Supreme Court; we don't

have it in the court of appeal. All this does is to import the

provisions of

section 67 of the Supreme Court Act into the court of

appeal procedure. As the member will see from looking at the provision,

it only applies to that person who the court is satisfied has

habitually, persistently and without reasonable cause instituted

vexatious proceedings. That person can't go forward with an appeal

except by leave. There aren't very many cases, but it allows the court

to regulate them, so you don't have the appeal books being filed and

all the costs, some of which are public, mounting up and getting to

that later stage. You have to get leave before you can get your appeal

set down if an order has been made that

[ Page 2144 ]

you are a character who is frivolous, vexatious and persistent. I couldn't possibly fall into all those categories.

MR. SIHOTA: That may be a matter of debate.

I'm not going to belabour this point, except to say that if my

recollection of court of appeal rules is correct.... I haven't done a

lot of court of appeal work, but I thought there was a clause right in

the middle or near the end that says that wherever a rule doesn't exist

with respect to the court of appeal, the Supreme Court rules would

apply, which would still allow it to be covered. But I'm really

operating on memory there. I'm quite content to allow this to go

through, but it will be of some interest to me just to check to see

whether I am quite correct in that recollection, because I think there

is a provision in court of appeal rules that takes you back to Supreme

Court rules.

HON. B.R. SMITH: There is a rule that takes you back in some

respects, but it doesn't deal with this problem. There has to be a

special

section put in the act that's the advice of legislative

counsel, and that was the request of the Chief Justice: to put that

power in the act.

Sections 16 to 20 inclusive approved.

section 21.

MR. CASHORE: Mr. Chairman, as I understand it, the operative

word in

section 21 is the "disclosure" of information — the power to

disclose information with respect to a child — being a power given to

the superintendent of child welfare;

whereas the way

section 22 is now,

it states: "No person shall disclose information obtained under this

Act respecting an individual except to his own counsel in a proceeding,

when giving evidence in a proceeding, or where disclosure is necessary

for the administration of this Act or is required by another Act." So

this adds a power to the superintendent.

I wonder if the Attorney-General would explain just why this power

is being added at this time. I'm not sure just what kind of information

is being anticipated here.

HON. B.R. SMITH: It appears that in the opinion of the child

care bureaucracy there are circumstances where it would be in the best

interest of the child to have the superintendent release information.

This amendment would give the superintendent the discretionary

authority to release information deemed to be in the child's best

interest.

I wish I could give you some examples; I can stand it down and seek

guidance as to what those examples may be. It was prohibited before,

and now it's discretionary. The sort of thing that I could think of

would be medical information: a history of allergies to drugs.... This

kind of thing might be not only in the child's interest; it might be

absolutely essential to his life and well-being. Those are the sorts of

things that come to my mind.

If you want more information on it, we can stand it down.

MR. CASHORE: Perhaps I could make a couple more points, and

then if the Attorney-General would stand it down and bring back more

information, that would be appreciated.

I think that for reasons such as health, it certainly is a very valid concern

that would come up in an issue such as this. But I think we always have to be

cautious and vigilant when we are involved in enacting any kind of legislation

that might result in a loss of rights and freedoms. I don't see anything

that would be entrenched within this legislation that would lay down any kinds

of guidelines, any kinds of conditions, any kinds of checks and balances that

would guide the superintendent. One of my concerns is that this is such a wide

open process that would become available.

Looking at the Charter of Rights and Freedoms, I would appreciate

it if the Attorney would look at this amendment in the light of the

equality rights section,

section 15: "Every individual is equal before

and under the law and has the right to the equal protection and equal

benefit of the law without discrimination and, in particular, without

discrimination based on.... " — and that includes "age."

If this could be postponed and my comments would be addressed at a later time, I would appreciate it.

MR. SIHOTA: I also want to add to what my friend has had to

say before, hopefully, this

section is stood down. I don't like this

section at all. It is too broad, it is too encompassing and it creates

a situation which, in my mind, is one that can be open to abuse. The

reason I say that is that I am sure the Attorney-General knows as well

as I do that the Family and Child Service Act is a very efficient piece

of legislation.

It allows for intervention by the ministry for apprehension of

children on a relatively efficient basis. On the whole, that's good. On

the whole, the act tends to work well. On the other hand, I've been

involved in instances, and I honestly believe that it is those

instances that I'm about to cite right now that are going to result in

ongoing litigation and ongoing allegations, those continual

difficulties that we all know about that show up in front of the courts.

In those instances, as we've all seen, it's an ex parte application.

Quite often the ministry will put forward its case and proceed and

seize a child for seven days and not be able to come up with any

further information. I would hate to think that that ex parte

information will be the basis of a future action against a spouse or

even against a child. When you tie in all the juvenile delinquency acts

and some of the criminal activities that can come up or some

applications that may show up later on under the Family Relations Act,

I think that this

section is too encompassing. I agree that there may

be some legitimate public interest reasons for allowing this

information to go, and health is one. But I think the better way to

deal with

section 21, and the reason why I would like to see it stood

down and brought back in a future amendment, is to have some more

specificity added, so it sets down the basis upon which the

section

will be triggered. For example, for reasons of health — that's fine; in

a dispute on the Family Relations Act, I'm not too sure if this ex

parte information in particular ought to be utilized.

The

section needs to be carved out in a little more sensitive

fashion than it is here, and I would like to see it stood down for that

reason. We can come back and deal with it in the next session.

[11:30]

HON. B.R. SMITH: I think it would certainly be better to

postpone it. If we can't deal with it before the end of the bill,

that's another matter. If we postpone it, we'll bring back some more

information on it.

MR. CHAIRMAN:

Section 21 is postponed.

[ Page

2145 ]

Sections 22 to 28 inclusive approved.

section 29.

MR. SIHOTA: Perhaps the minister could explain to me the

rationale behind this change, which, I take it, requires the Supply Act

appropriation to be exhausted before money is paid out under any other

appropriation. I think I understand it, but I would like it if the

minister could give us an indication of the government's intent.

[Mr. Pelton in the chair.]

HON. MR. COUVELIER: Mr. Chairman, the amendment specifies

that appropriations provided under a Supply Act are to be utilized

first for payment of expenditures, whenever there is also a statutory

appropriation for the same purpose. The statutory appropriation is only

to be used after the Supply Act appropriation has been exhausted.

The member might be interested in some examples. Forest fire

suppression is an example. We need to have the money to do the job

whenever the need arises, and that's the purpose of the amendment.

Section 29 approved.

section 30.

MR. S.D. SMITH: Just a short question. I am wondering under

what circumstances it would be contemplated that investments would be

made in options and financial futures — particularly in options.

HON. MR. COUVELIER: This new subsection adds to the variety

of eligible vehicles in which money from the consolidated revenue fund

and a trust fund may be invested. It empowers the minister to invest in

futures and options for both currencies and fixed-income instruments.

The result will be added flexibility and the management of the

province's investment portfolio through provision for hedging against

risk and minimizing foreign exchange exposure.

I should make it clear, Mr. Chairman, that investments in futures

and options will not be made for speculative purposes and will be used

very sparingly.

MR. S.D. SMITH: I don't want to belabour the point, but I concur

with the Minister of Finance that this is a highly speculative business, and

I'm just wondering if the minister could give me an example of some circumstance

in which it would be considered appropriate to invest the people's money

in that kind of option or futures contract.

HON. MR. COUVELIER: To the maximum extent possible, we invest

in Canadian funds only, as the member knows. As a matter of fact, the

only securities instruments that we're investing in American funds at

all are B.C. Hydro instruments, where a large part of their income is

in U.S. funds in any event. It sometimes makes good sense to make that

kind of transaction.

If the dollar is perceived to be either stronger or weaker, this provision

would allow us to hedge the risk. It seems to me that it could be argued persuasively

that failure to hedge against the currency valuation variation is speculating

in itself. The situation we have before us now, for example, is the opportunity

to deal in Japanese yen. We are looking at that very closely. There is a wide

spread between the dollar and the yen which is far more than in normal historical

relationships. As a consequence, we always look at these opportunities and judge

them on their merits. It's not something that we take lightly or are intending

to abuse. We did feel that the flexibility provided would be an important tool

for us if, as and when we ever wanted to use it.

MR. S.D. SMITH: The whole area of options and financial

futures in relation to money is one that's evolving. I think the

investment decisions that have been taken by the ministry and the

department that deals with investments have been very good. I think

they've had a great deal of success, and they've served the province

extremely well. Part of that success has flowed from the fact that they

have been somewhat conservative in terms of that investment authority.

I just caution the minister that moving into the area of investment of

securities.... It is one which is highly speculative, one in which the

private sector itself is really feeling its way in many instances, and

in which people who have the responsibility to invest the people's

money and the people's credit ought to be extremely cautious.

MR. LOVICK: Mr. Chairman, I want to pursue precisely the same

line indicated by my colleague the second member for Kamloops. It's

difficult not to remember the scene in the House yesterday, when the

Minister of Finance was talking about the Vancouver Stock Exchange,

when we confront the possibility outlined in this particular section.

We are talking here about a pretty high-risk market. The obvious

question that comes to mind is whether we have the expertise and the

qualifications to play in that market.

The specific questions I want to pose to the minister are to do with

just that general subject. What are our qualifications for getting into

this game? Who are the people who are going to be charged with this

responsibility? It's one thing to be a very competent financial

administrator and a very competent accountant, but it is quite a

different thing, of course, to be somebody who plays with or regularly

invests in the futures market. I wonder if the minister would like to

start by responding to that.

HON. MR. COUVELIER: Mr. Chairman, I noted with pleasure the

comments of the hon. second member for Kamloops (Mr. S.D. Smith). The

one that gave me such satisfaction dealt with the competence of the

ministry in dealing with provincial investments and protecting the

province against financial risk. The record has been exemplary, and

it's one that all of us are very proud of. It's a tribute to the staff

who perform the function. There is more and more evidence to indicate

that in the area of financial instruments the market is now worldwide,

and that there is rapid transfer of funds around the world in different

currencies at a rate that boggles the mind and proceeds 24 hours a day.

Because of that dynamic situation, there will conceivably be times when

in the interests not only of protecting the province's financial

position but also of maximizing return, it may be prudent for us to

take some hedges against currency fluctuations. This amendment merely

adds that option to the arsenal of tools available to our public

servants, in the same way that that arsenal of tools is available to

everybody in the financial market.

[ Page 2146 ]

I want to emphasize again that no one has a higher appreciation of

the importance of protecting the public purse. We certainly are not

contemplating, and would never consider, any adventures in this area.

It really is a question of protecting our financial position by

providing the opportunity to take hedges when they're deemed prudent.

We haven't as a matter of course done much in that area in the past,

and we don't contemplate doing much of it in the future.

MR. LOVICK: I appreciate the Minister of Finance's response

to those questions and concerns, but I would remind him that the reason

the ministry does have the good track record it has, which he can point

to with some justifiable pride, is that we have not yet played in this

particular arena. This is new stuff. There's a qualitative difference,

I'm suggesting, between this kind of financial management and the more

orthodox conservative and traditional ones. That's the reason for the

concerns.

I am wondering whether in fact the legislation is perhaps too

enabling. It's well and good to say, as the minister does, "Please trust

us; we are going to approach this in a very careful and conservative

fashion," but we have no guarantee that the same Minister of Finance

will be on the job some months down the road. We also don't have any

guarantee that any individual charged with the kind of power that this

legislation gives to him or her will always remain stable and capable

and competent. Things do change. I have some concern, then, about what

appears to be the absence of circumscription or limitation on the power

and latitude of the Minister of Finance to operate, given this section.

I'm wondering if the minister would care to respond to that concern.

HON. MR. COUVELIER: Mr. Chairman, the staff member who has

specific responsibility to protect the public interest in this respect

has now joined the House, and I take some comfort from the expertise

that now is at my right side here. The point has been made earlier that

what we primarily are attempting to do is make sure that we protect the

public interest, and that where appropriate we might be able to hedge

the risk that is associated. For example, if there is a payment pending

soon in the case of the only foreign currency we trade in now — U.S.

funds — because of currency spreads, it may be advisable for us to buy

those funds now to cover a future payout. So these kinds of

opportunities arise seldom, but when they do it would be in the public

interest for us to act on them. That's all that's contemplated here.

MR. BLENCOE: Mr. Chairman, the minister has basically been

defending his amendment on the currency option, but the futures option

is a totally different ball game. Indeed wise, conservative, long-range

investors tend to stay away from that option, and the way the minister

is putting his case this morning, really, you can call this the "trust

me" amendment. We can't work in that kind of ball game.

Interjection.

MR. BLENCOE: It says "financial futures." The fact that it's

there as an option is very dangerous, risky business. The minister

can't monitor all his staff, but the option will be there for senior

staff, without the minister knowing it, to participate in a futures

market, and it's dangerous stuff, and we wonder if the minister has

taken sound advice on this.

Perhaps he can describe to us where that advice has come from.

HON. MR. COUVELIER: Mr. Chairman, I've just been assured that

the advice we're taking is very sound, and I can tell you that in my

judgment it's very capable. I want to make sure you understand that

we're not talking about commodity futures here; we're talking about

interest futures. As I say, the opportunity would only be exercised

whenever it was deemed to be in the public interest to do so. I think

our past record in this respect, in terms of conservative stewardship

of public funds, is beyond dispute and therefore should give heart to

those who express some concern.

The opportunity here is a double-edged sword. We have an obligation

to protect the provincial financial position. That means not only

managing it conservatively, but also, when there appears to be a need

for a hedge, that we be provided the opportunity to take the hedge. To

suggest that we would be denied that opportunity seems to me of itself

the irresponsible acceptance of a risk that need not be assumed.

[11:45]

MR. BLENCOE: The minister makes, to some degree, some valid

points, but I would point out that this is a permissive amendment. It

doesn't clarify what type of futures. Perhaps he should lay out that he

means interest futures rather than commodity futures, but again it's

permissive. It's wide open.

HON. MR. COUVELIER: The amendment adds options and financial

futures, including currency and fixed income instruments. I don't know

what we might do to clarify that to satisfy the member, but I tell you

that that's the intention, and I tell you that it is in the public

interest to give that kind of flexibility.

I repeat: it is not something that would be taken frivolously; it is

not something that would be used injudiciously. It is something that

would only be used when the public interest demanded that it be used. I

can imagine standing in this House defending our failure to have

protected the public interest by not taking a hedge, when everyone

understood and realized the need to do so, if someone faced with making

an expenditure of a foreign currency in the near term had been denied

the opportunity to take a hedge on that risk.

MR. S.D. SMITH: Just for my own clarification, maybe I can

come at it another way to express my concern. Are there any known

options or financial futures now on the market in which it would be

deemed inappropriate to invest?

HON. MR. COUVELIER: I don't quite know what the member is

expecting in a response. I mean, we're certainly not talking about

buying Russian rubles or Bulgarian whatever it is. We're talking about

the established practice of Hydro borrowing some American funds that

will be paid for out of Hydro's American earnings. That's an

illustration of what is acceptable and traditional.

We have been faced with payouts of those funds, and we've seen

indications where, had we had the opportunity to hedge, we could have

reduced the public cost of those American borrowings. We see a

situation before us now with the Japanese yen vis-a-vis the Canadian

dollar. Those opportunities can't be predicted, because it's a dynamic

process

[ Page

2147 ]

and you're talking about rapid changes. You really have to have the flexibility to move quickly.

However, I repeat: we are not talking about embarking on some great

adventure with public money. What we are talking about is ensuring that

you give us the flexibility we need to properly manage public funds.

MR. CASHORE: Mr. Chairman, a few moments ago the minister, in

response to a question from the second member for Victoria (Mr.

Blencoe), said that we're not talking here about commodities futures,

we're talking about interest futures.

I would assume that the minister has in front of him

section 36 of

the act. I wonder if he would reassure us by reading us a

section of

the act that is not before us — possibly

section 36 — that would

reassure us that those words are there somewhere. The minister has said

that this is in reference to interest futures, not commodity futures. I

would assume that somewhere he has the authority for that statement,

and I can only assume that it's somewhere within the legislation that

we can't see in the amendment. It would probably be in the act that the

minister has in front of him.

I would submit that if he is not able to cite that for us at this

time, then his reassurance, although it's given with all good intent,

is hollow.

HON. MR. COUVELIER: Does the hon. member have the

section

before him? I have it before me. There's clearly no opportunity to

invest in commodity futures.

MR. CASHORE: Answer my question.

HON. MR. COUVELIER: It isn't contained in

section

Section 36 runs over three pages. Would you like me to recite them?

MR. CASHORE: Mr. Chairman, I'm sure the minister can

appreciate that most of us don't have a copy of the act in front of us,

as he does. What we have is this very short, cryptic statement of the

amendment. I'm asking the minister to trace this amendment back into

the legislation he has before him so that we will have the reassurance

that this does indeed refer to interest futures and not commodity

futures.

HON. MR. COUVELIER: We're talking about adding a new section,

36(l)(e); and 36(

l) talks about money from the consolidated revenue

fund that is not immediately required for payments: "...the Minister

invest...in any of the following...." Then there is (a), (b), (

c) and

(d), and we're adding a new

section which provides the opportunity to

deal in options and financial futures. It is an expansion of the

existing section. The securities that are presently and have

traditionally been authorized for these kinds of transactions are

securities or obligations guaranteed by Canada or by any Canadian

province, or securities and obligations of the United States; fixed

deposits, notes, certificates and other short-term paper of or

guaranteed by a savings institution, including swapped deposit

transactions in currency of the United States of America; securities

issued by the Municipal Finance Authority of British Columbia; and

commercial paper issued by a company incorporated under the laws of

Canada or of a province, the securities of which are rated in the

highest rating category by at least two recognized security-rating

institutions.

We have been operating under those conditions with, I think, some

success, although, as I say, the dynamics of the marketplace are such

that we do believe we can protect the public interest further by having

an opportunity in those rare instances when we might want to deal in

options and financial futures. This new

section adds that freedom.

MR. CASHORE: Mr. Chairman, I think that when I first asked my

question I used the term "interest futures," and then I made a mistake

and started referring to financial futures. The two terms the minister

used were "commodities futures" and "interest futures." I still don't

think that the legislation as amended makes it clear that this would

refer to interest futures, which I understand are much less

risk-oriented than commodities futures.

MR. LOVICK: I think that the clarification of precisely what

it is this

section does indeed provide is helpful. The only point I

would draw from that, as a kind of object lesson for the future, is

that when we are dealing with these kinds of amendments, it would seem

to me that we would all be better served if we perhaps had just a very

brief

preamble of explanation, suggesting that this is merely the sixth

or seventh in a series of things.

Before we leave this issue, the question I want to pose is: how long

has it been that the government of this province, through the Ministry

of Finance, has apparently been less than protective of the public's

interest? How long has it been that we've been negligent? How long has

it been that we have not, in fact, been doing what we ought to do in

terms of protecting the people's interest? Surely the minister isn't

going to suggest to us that only within the last year or so the

financial marketplace has changed qualitatively and significantly, to

the point that we suddenly have this new event. If in fact this is a

good idea now, why wasn't it a good idea ten years ago?

HON. MR. COUVELIER: Quite simply put, Mr. Chairman, because

the financial marketplace has become much more dynamic in recent years

than it has historically been. As I said, it is now a world market in

every sense of the word; something that has been evolving over a number

of years, and something which is inevitable, given the trends. So we

are saying that it is appropriate now for us to have this added

flexibility, which will be needed from time to time.

We're adding options and financial futures. The member should

understand that under the existing traditional legislation, we've had —

in recent time, at least — the opportunity to deal in financial

forwards; so we're just adding options and futures to it. All of those

instruments — options, futures and forwards — are really hedging

instruments. So we're just adding another couple of items to our

arsenal of tools that might be used.

MR. LOVICK: Mr. Chairman, would the minister not agree that

we are also taking a step, by the same token, further along the

continuum of risk? Is that not the case?

HON. MR. COUVELIER: No, Mr. Chairman, it is not. The point I

am trying to make is that it is in the public interest to ensure that

when we have payouts required in foreign currencies, we have the

opportunity — indeed, I think, the

[ Page 2148 ]

obligation — to ensure that, when a current money market situation

is there, we might realize some savings, knowing the inevitability of a

payout within a very short period of time. We should have the

opportunity to hedge that. That clearly is in the public interest.

MR. SIHOTA: When I was reading Bill 31, I must confess I

hummed and hawed about whether or not I would oppose it. But I think it

comes down to this, in my mind: if it was my money, that's fine; I

certainly could go ahead and play the futures market. But on the other

hand, if it's public funds, I just tend to think that we're going a

little too far.

The minister talks about the arsenal of investment that's available.

The fact of the matter is, there is already quite an incredible arsenal

of investment options available to the ministry. I want to say that the

staff who do this — many of whom I know — do a very good job on the

part of the ministry. I think that should also be recognized, and it's

recognized by people on this side of the House.

So our comments ought not to be designed to question their skills

but to question whether or not, as a matter of public policy, we ought

to be engaging in this type of investment. For your private funds,

sure; for your public funds, I think it's going too far.

Sections 30 to 33 inclusive approved.

section 34.

MR. SIHOTA: On

section 34, the minister just confirmed to me

that the authority vested in him to appoint fiscal agents is

pre-existing. We're not giving the minister a new authority here, are

we?

HON. MR. COUVELIER: The intention here, Mr. Chairman, is to

allow us to appoint fiscal agents, and the issue we have in mind here

is in Europe, where we don't have representation. This is a contractual

arrangement — a traditional one. We contract with our fiscal agents all

over the whole gamut of requirements, but we don't have that

opportunity in Europe at the moment. This merely empowers me to appoint

a fiscal agent and to fix a remuneration for them to be paid.

Section 34 approved.

section 35.

MR. LOVICK: A very short and direct question to the minister:

why? Why have we changed the requirement that a full report of all

borrowings be included in public accounts?

We replace that with just a

summary. What's the rationale for that?

[12:00]

HON. MR. COUVELIER: Primarily, the intent here is to reduce

the bureaucratic paperwork that the present act seems to suggest be

supplied. We might do 80 transactions around one particular matter. In

our judgment, it is more understandable if we use a

summary format

rather than all of those detailed elements.

Section 35 approved.

section 36.

MR. STUPICH: I've been reading

section 56 here and in the

original version of the Financial Administration Act, and I can't see

what's being accomplished other than to change the order of the

subsections. I'm not sure what we're accomplishing in clause 36. As I

say, I have the other version in front of me and there's a similar

number of sections — maybe not the exact number. The order has changed

some, but I don't know what else is being done. Could the minister

enlighten the House?

HON. MR. COUVELIER:

Section 56 of the Financial

Administration Act is repealed and restated in a more comprehensive

format. New provisions are now included respecting the giving of

guarantees and indemnities by or on behalf of the government. This will

strengthen existing legislation by requiring all government guarantees

and indemnities, whether given under the Financial Administration Act

set by these amendments and the regulations.

The wording of the current legislation has raised doubts as to

whether there is clear authority for government to give guarantees and

indemnities, and for whom and with whom the authority rests. The

amendments are designed to eliminate any doubt on this subject.

MR. STUPICH: Mr. Chairman, I hear the word "time." Is it appropriate at this point that the committee rise?

The House resumed; Mr. Speaker in the chair.

The committee, having reported progress, was granted leave to sit again.

Hon. Mr. Strachan moved adjournment of the House.

Motion approved.

The House adjourned at 12:03 p.m.

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