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British Columbia — Debates (Hansard)

4th Session, 37th Parliament OFFICIAL REPORT OF DEBATES OF THE LEGISLATIVE ASSEMBLY (HANSARD) Tuesday, March 11, 2003 Afternoon Sitting Volume 12, Number 11 THE HONOURABLE CLAUDE RICHMOND, SPEAKER ISSN 0709-1281

PROVINCE OF BRITISH COLUMBIA (Entered Confederation July 20, 1871) LIEUTENANT-GOVERNOR Honourable Iona Campagnolo 4TH SESSION, 37TH PARLIAMENT SPEAKER OF THE LEGISLATIVE ASSEMBLY Honourable Claude Richmond EXECUTIVE COUNCIL Premier and President of the Executive Council................................................................................. .........................Hon. Gordon Campbell Minister of State for Intergovernmental Relations.............................................................................. ..................... Hon.

Greg Halsey-Brandt Deputy Premier and Minister of Education ....................................................................................... ..................................Hon. Christy Clark Minister of Advanced Education................................................................................................. ...........................................Hon. Shirley Bond Attorney General and Minister Responsible for Treaty Negotiations.............................................................. .................... Hon.

Geoff Plant Minister of Children and Family Development.................................................................................... ..............................Hon. Gordon Hogg Minister of State for Early Childhood Development.............................................................................. .................................Hon. Linda Reid Minister of Community, Aboriginal and Women's Services......................................................................... .................. Hon.

George Abbott Minister of State for Community Charter........................................................................................ .................................. Hon. Ted Nebbeling Minister of State for Women's Equality ......................................................................................... .................................... Hon. Lynn Stephens Minister of Competition, Science and Enterprise ................................................................................ ..................................Hon.

Rick Thorpe Minister of State for Deregulation ............................................................................................. ............................................ Hon. Kevin Falcon Minister of Energy and Mines................................................................................................... ....................................... Hon. Richard Neufeld Minister of Finance ............................................................................................................ ....................................................... Hon.

Gary Collins Minister of Forests ............................................................................................................ .................................................. Hon. Michael de Jong Minister of Health Planning .................................................................................................... ............................................ Hon. Sindi Hawkins Minister of Health Services.................................................................................................... ................................................ Hon.

Colin Hansen Minister of State for Mental Health ............................................................................................ ...................................Hon. Gulzar S. Cheema Minister of State for Intermediate, Long Term and Home Care ............................................................................. Hon. Katherine Whittred Minister of Human Resources.................................................................................................... ............................................Hon.

Murray Coell Minister of Management Services................................................................................................ .........................................Hon. Sandy Santori Minister of Provincial Revenue................................................................................................. ................................................Hon. Bill Barisoff Minister of Public Safety and Solicitor General ................................................................................ ..................................Hon.

Rich Coleman Minister of Skills Development and Labour...................................................................................... .............................Hon. Graham P. Bruce Minister of Sustainable Resource Management and Minister of Agriculture, Food and Fisheries ..................................Hon. Stan Hagen Minister of Transportation..................................................................................................... .................................................... Hon.

Judith Reid Minister of Water, Land and Air Protection..................................................................................... ....................................Hon. Joyce Murray LEGISLATIVE ASSEMBLY Deputy Speaker................................................................................................................. ..............................................................

John Weisbeck Leader of the Opposition ....................................................................................................... ...........................................................Joy MacPhail Deputy Chair, Committee of the Whole ........................................................................................... .............................................. Harold Long Clerk of the Legislative Assembly .............................................................................................. .........................................E.

George MacMinn Clerk Assistant ................................................................................................................ ................................................................... Robert Vaive Clerk Assistant and Law Clerk .................................................................................................. ........................................................ Ian D. Izard Clerk Assistant and Clerk of Committees........................................................................................ ............................................Craig H.

James Clerk Assistant/Committee Clerk................................................................................................ ............................................ Kate Ryan-Lloyd Sergeant-at-Arms ............................................................................................................... .........................................................A.A. Humphreys Director, Hansard Services ..................................................................................................... ........................................

Anthony Dambrauskas Legislative Librarian.......................................................................................................... ............................................................. Joan A. Barton Legislative Comptroller ........................................................................................................ .................................................................Peter Bray Published by British Columbia Hansard Services, and printed under the authority of the Speaker by the Queen's Printer, Victoria.

Rates: single issue, $2.85; per calendar year, mailed daily, $298. GST extra. Agent: Crown Publications Inc., 521 Fort St., Victoria, B.C. V8W 1E7. Telephone: (250) 386-4636. Fax: 386-0221. www.leg.bc.ca/hansard In addition to printed transcripts, Hansard Services publishes transcripts on the Internet and broadcasts Chamber debates on television.

Party Standings: Liberal 75; New Democratic 2; Independent Liberal 2. ALPHABETICAL LIST OF MEMBERS Abbott, Hon. George (L) ....................................................................... Shuswap Anderson, Val J. (L) .............................................................Vancouver-Langara Barisoff, Hon. Bill (L)............................................. Penticton–Okanagan Valley Bell, Pat (L).........................................................................Prince George North Belsey, Bill (L).................................................................................

North Coast Bennett, Bill (L) ........................................................................... East Kootenay Bhullar, Tony (Ind. L) ................................................................. Surrey-Newton Bloy, Harry (L).................................................................................. Burquitlam Bond, Hon. Shirley (L).........................................Prince George–Mount Robson Bray, Jeff (L)......................................................................Victoria–Beacon H ill Brenzinger, Elayne (L) ...............................................................

Surrey-Whalley Brice, Susan (L) ............................................................................Saanich South Bruce, Hon. Graham P. (L)................................................ Cowichan-Ladysmith Campbell, Hon. Gordon (L)............................................. Vancouver–Point Grey Cheema, Hon. Gulzar S. (L) ..........................................Surrey–Panorama Ridge Chong, Ida (L)................................................................ Oak Bay–Gordon Head Christensen, Tom (L) .............................................................

Okanagan-Vernon Chutter, Dave (L) ........................................................................... Yale-L illooet Clark, Hon. Christy (L) ..................................................Port Moody–Westwood Cobb, Walt (L) ............................................................................. Cariboo South Coell, Hon. Murray (L) ........................................ Saanich North and the Islands Coleman, Hon. Rich (L) .............................................. Fort Langley–Aldergrove Collins, Hon.

Gary (L).........................................................Vancouver-Fairview de Jong, Hon. Michael (L)....................................... Abbotsford–Mount Lehman Falcon, Hon. Kevin (L) .......................................................... Surrey-Cloverdale Hagen, Hon. Stan (L) ................................................................... Comox Valley Halsey-Brandt, Hon. Greg (L) ..................................................Richmond Centre Hamilton, Arnie (L)............................................................Esquimalt-Metchosin Hansen, Hon.

Colin (L) .....................................................Vancouver-Quilchena Harris, Roger (L)......................................................................................Skeena Hawes, Randy (L) ............................................................ Maple Ridge–Mission Hawkins, Hon. Sindi (L).......................................................... Kelowna-Mission Hayer, Dave S. (L) ................................................................... Surrey-Tynehead Hogg, Hon. Gordon (L) ........................................................

Surrey–White Rock Hunter, Mike (L) ...................................................................................Nanaimo Jarvis, Daniel (L)...................................................... North Vancouver–Seymour Johnston, Ken (L)............................................................ Vancouver-Fraserview Kerr, Brian J. (L).............................................................. Malahat–Juan de Fuca Krueger, Kevin (L).................................................

Kamloops–North Thompson Kwan, Jenny Wai Ching (NDP) ...............................Vancouver–Mount Pleasant Lee, Richard T. (L).......................................................................Burnaby North Lekstrom, Blair (L)................................................................. Peace River South Les, John (L) .......................................................................... Ch illiwack-Sumas Locke, Brenda (L) ...........................................................

Surrey–Green Timbers Long, Harold (L) ...................................................Powell River–Sunshine Coast MacKay, Dennis (L)....................................................... Bulkley Valley–Stikine McMahon, Wendy (L).............................................Columbia River–Revelstoke MacPhail, Joy (NDP) ..........................................................

Vancouver-Hastings Manhas, Karn (L) .............................................Port Coquitlam–Burke Mountain Masi, Reni (L) ...................................................................................Delta North Mayencourt, Lorne (L) ..........................................................Vancouver-Burrard Murray, Hon. Joyce (L) ........................................................... New Westminster Nebbeling, Hon. Ted (L) .......................................... West Vancouver–Garibaldi Nettleton, Paul (Ind. L)..................................................Prince George–Omineca Neufeld, Hon.

Richard (L)...................................................... Peace River North Nijjar, Rob (L)...................................................................Vancouver-Kingsway Nuraney, John (L) ...............................................................Burnaby-W illingdon Orr, Sheila (L) ...........................................................................Victoria-Hillside Penner, Barry (L)....................................................................... Ch illiwack-Kent Plant, Hon. Geoff (L) ......................................................... Richmond-Steveston Reid, Hon.

Judith (L)............................................................Nanaimo-Parksv ille Reid, Hon. Linda (L) ................................................................... Richmond East Richmond, Hon. Claude (L) ................................................................ Kamloops Roddick, Valerie (L)..........................................................................Delta South Sahota, Patty (L).....................................................................Burnaby-Edmonds Santori, Hon. Sandy (L)..............................................West Kootenay–Boundary Stephens, Hon.

Lynn (L) ........................................................................ Langley Stewart, Ken (L)...................................................... Maple Ridge–Pitt Meadows Stewart, Richard (L) ...................................................... Coquitlam-Maillardville Suffredine, Blair F. (L) ................................................................Nelson-Creston Sultan, Ralph (L)....................................................... West Vancouver–Capilano Thorpe, Hon.

Rick (L) ..........................................................Okanagan-Westside Trumper, Gillian (L)................................................................Alberni-Qualicum van Dongen, John (L).........................................................Abbotsford-Clayburn Visser, Rod (L).................................................................................North Island Weisbeck, John (L).........................................................Kelowna–Lake Country Whittred, Hon.

Katherine (L) ...................................North Vancouver–Lonsdale Wilson, John (L)........................................................................... Cariboo North Wong, Patrick (L)............................................................Vancouver-Kensington LIST OF MEMBERS BY RIDING Abbotsford-Clayburn................................................................John van Dongen Abbotsford–Mount Lehman ..............................................Hon.

Michael de Jong Alberni-Qualicum.......................................................................G illian Trumper Bulkley Valley–Stikine ..............................................................Dennis MacKay Burnaby North..............................................................................Richard T. Lee Burnaby-Edmonds............................................................................Patty Sahota Burnaby-Willingdon......................................................................

John Nuraney Burquitlam ........................................................................................ Harry Bloy Cariboo North ..................................................................................John Wilson Cariboo South .................................................................................... Walt Cobb Chilliwack-Kent ............................................................................. Barry Penner Chilliwack-Sumas .................................................................................

John Les Columbia River–Revelstoke....................................................Wendy McMahon Comox Valley .......................................................................... Hon. Stan Hagen Coquitlam-Maillardville .............................................................Richard Stewart Cowichan-Ladysmith .......................................................Hon. Graham P. Bruce Delta North.......................................................................................... Reni Masi Delta South................................................................................

Valerie Roddick East Kootenay .................................................................................. Bill Bennett Esquimalt-Metchosin...................................................................Arnie Hamilton Fort Langley–Aldergrove ..................................................... Hon. Rich Coleman Kamloops ....................................................................... Hon. Claude Richmond Kamloops–North Thompson ........................................................Kevin Krueger Kelowna–Lake Country...............................................................

John Weisbeck Kelowna-Mission ................................................................ Hon. Sindi Hawkins Langley ............................................................................... Hon. Lynn Stephens Malahat–Juan de Fuca .....................................................................Brian J. Kerr Maple Ridge–Mission ................................................................... Randy Hawes Maple Ridge–Pitt Meadows .............................................................Ken Stewart Nanaimo..........................................................................................

Mike Hunter Nanaimo-Parksville ...................................................................Hon. Judith Reid Nelson-Creston.......................................................................Blair F. Suffredine New Westminster ..................................................................Hon. Joyce Murray North Coast ........................................................................................Bill Belsey North Island........................................................................................Rod Visser North Vancouver–Lonsdale.......................................... Hon.

Katherine Wh ittred North Vancouver–Seymour .............................................................Daniel Jarvis Oak Bay–Gordon Head .......................................................................Ida Chong Okanagan-Vernon .................................................................... Tom Christensen Okanagan-Westside.................................................................Hon. Rick Thorpe Peace River North .............................................................Hon. Richard Neufeld Peace River South .......................................................................

Blair Lekstrom Penticton–Okanagan Valley ....................................................Hon. Bill Barisoff Port Coquitlam–Burke Mountain.................................................... Karn Manhas Port Moody–Westwood......................................................... Hon. Christy Clark Powell River–Sunshine Coast.......................................................... Harold Long Prince George North................................................................................Pat Bell Prince George–Mount Robson................................................Hon.

Shirley Bond Prince George–Omineca................................................................Paul Nettleton Richmond Centre......................................................... Hon. Greg Halsey-Brandt Richmond East .......................................................................... Hon. Linda Reid Richmond-Steveston ................................................................ Hon. Geoff Plant Saanich North and the Islands ............................................... Hon. Murray Coell Saanich South...................................................................................

Susan Brice Shuswap .............................................................................. Hon. George Abbott Skeena.............................................................................................Roger Harris Surrey-Cloverdale ................................................................. Hon. Kevin Falcon Surrey–Green Timbers .................................................................. Brenda Locke Surrey-Newton ............................................................................... Tony Bhullar Surrey–Panorama Ridge................................................. Hon.

Gulzar S. Cheema Surrey-Tynehead .......................................................................... Dave S. Hayer Surrey-Whalley ...................................................................... Elayne Brenzinger Surrey–White Rock ...............................................................Hon. Gordon Hogg Vancouver-Burrard................................................................. Lorne Mayencourt Vancouver-Fairview............................................................... Hon.

Gary Co llins Vancouver-Fraserview ...................................................................Ken Johnston Vancouver-Hastings .......................................................................Joy MacPhail Vancouver-Kensington...................................................................Patrick Wong Vancouver-Kingsway..........................................................................Rob Nijjar Vancouver-Langara....................................................................Val J.

Anderson Vancouver–Mount Pleasant............................................Jenny Wai Ching Kwan Vancouver–Point Grey ................................................... Hon. Gordon Campbell Vancouver-Quilchena............................................................ Hon. Colin Hansen Victoria–Beacon Hill.............................................................................Jeff Bray Victoria-Hillside.................................................................................. Sheila Orr West Kootenay–Boundary.................................................... Hon.

Sandy Santori West Vancouver–Capilano ..............................................................Ralph Sultan West Vancouver–Garibaldi ................................................. Hon. Ted Nebbeling Yale-Lillooet .................................................................................. Dave Chutter

CONTENTS Tuesday, March 11, 2003 Afternoon Sitting Routine Proceedings Page Introductions by Members....................................................................................................... ............................................... 5417 Introduction and First Reading of Bills ........................................................................................ ......................................... 5418 Community Charter (Bill 14) Hon. T. Nebbeling Motor Vehicle Amendment Act, 2003 (Bill 17) Hon. R.

Coleman Statements (Standing Order 25B).............................................................................................................................. .............. 5419 B.C. Interior Forestry Museum W. McMahon Kootenay storytelling festival B. Suffredine McDonald family independent power projects B. Bennett Oral Questions................................................................................................................. ......................................................... 5420 Fair Pharmacare program income-testing model J. MacPhail Hon. C.

Hansen Affordability of assisted-living model P. Sahota Hon. K. Whittred Regulation of barbers and cosmetologists S. Brice Hon. G. Bruce Drug courts and mental health courts L. Mayencourt Hon. G. Plant Gravel extraction from Fraser River J. Les Hon. S. Hagen Future of B.C. Rail J. MacPhail Hon. J. Reid Petitions ...................................................................................................................... ............................................................... 5422 J.

MacPhail Committee of the Whole House ................................................................................................... .......................................... 5423 Budget Measures Implementation Act, 2003 (Bill 6) J. MacPhail Hon. G. Collins K.

Krueger Reporting of Bills............................................................................................................. ......................................................... 5432 Budget Measures Implementation Act, 2003 (Bill 6) Third Reading of Bills......................................................................................................... ..................................................... 5432 Budget Measures Implementation Act, 2003 (Bill 6)

Committee of the Whole House ................................................................................................... .......................................... 5432 Income Tax Amendment Act, 2003 (Bill 7) J. MacPhail Hon. G.

Collins Report and Third Reading of Bills .............................................................................................. ........................................... 5434 Income Tax Amendment Act, 2003 (Bill 7) Committee of the Whole House ................................................................................................... .......................................... 5434 Auditor General Act (Bill 9) Report and Third Reading of Bills .............................................................................................. ........................................... 5434 Auditor General Act (Bill 9) Committee of the Whole House ................................................................................................... .......................................... 5434 Miscellaneous Statutes Amendment Act, 2003 (Bill 11) J.

MacPhail Hon. G. Plant Hon. R. Coleman Hon. K. Falcon L. Mayencourt Report and Third Reading of Bills .............................................................................................. ........................................... 5438 Miscellaneous Statutes Amendment Act, 2003 (Bill 11) Committee of Supply ............................................................................................................ ................................................... 5438 Estimates: Ministry of Community, Aboriginal and Women's Services (continued) J. MacPhail Hon. G. Abbott Hon. L.

Stephens Second Reading of Bills ........................................................................................................ ................................................... 5445 Unclaimed Property Amendment Act, 2003 (Bill 15) Hon. G. Collins Proceedings in the Douglas Fir Room Committee of Supply ............................................................................................................ ................................................... 5445 Estimates: Ministry of Transportation Hon. J. Reid K. Manhas K. Krueger B. Penner D. MacKay B. Lekstrom D. Jarvis P. Wong

5417 TUESDAY, MARCH 11, 2003 The House met at 2:03 p.m. Introductions by Members Hon. T. Nebbeling: Today I would like to intro- duce two gentlemen who are in the gallery. These two gentlemen are here to be present when we introduce Bill 14 in a little while. First is Frank Leonard, who is the mayor of Saanich. He's also the first vice-president of the Union of British Columbia Municipalities and chairs the Municipal Finance Authority of B.C. With him is the executive director of the UBCM, Richard Taylor. I hope the House will make them very wel- come. [1405] Hon. G.

Campbell: I k n o w t hat t h i s m o r ni n g t h e member for Vancouver-Hastings made the an- nouncement of the birth of a daughter to the member for Vancouver–Mount Pleasant, but I think it is impor- tant today for us to remember that this is one of the most joyful times anyone can have. I think we should all send our warmest love and best wishes to Jenny Kwan and her daughter. Mr. Speaker: The Premier has a supplementary. Hon. G. Campbell: And her husband, Mr. Speaker. J. MacPhail: Ah, those men — they're always trying to get in on it. Thank you to the Premier. Yes, I did announce it this morning.

I talked to Jenny — to the member for Vancouver–Mount Pleasant — about an hour ago, and they have named their daughter Cee-Yan, and she's a beautiful, black-curly-haired young woman. I do note that the same day that she was brought into the world, though, there was an event — I don't k n o w w h a t y o u ' d c a l l i t … . T h e m e m b e r f r o m C o m o x was also brought into the world on the same day. I would call that a day of celebration as well. Happy birthday. Interjection. Mr. Speaker: I sincerely hope this absolves me of any responsibility. Hon. C.

Clark: I'm delighted to be able to introduce two relatives who are in the gallery today. We've all heard of economic refugees, and we've all heard of war refugees. I would like to introduce some weather refu- g e e s f r o m t h e c o l d t o w n o f S a r n i a : m y U n c l e B i l l a n d Aunt Jenny Kapteyn. B. Belsey: I have the pleasure today to introduce three people that are visiting us from Prince Rupert: Mr.

Bill Parmar, who is the president of the Prince Rupert and District Chamber of Commerce, as well as the past president of Rotary; his wife Anita; and his daughter Pamela, who is studying at the University of Victoria. Would you all please join me in making them welcome. Hon. G.

Plant: W e a r e j o i n e d i n t h e g a l l e r y t h i s afternoon by some hard-working folks from the legal services branch of the Ministry of Attorney General: lawyer Laurie Solway; some articling students ― Les- lie Baskerville, Elizabeth Meyer, Ann Roberts, Jeff Van Hinte and Aaron Welch; and two co-op students ― Daniel Morton and Simon Owen. They are here enthusiastically hoping that a little democracy will break out on the floor of the chamber in the next few minutes. I would ask all members to make them very welcome. J.

MacPhail: Today being quite an auspicious day, we're joined by an old colleague of all of ours — a for- mer colleague, not old: Corky Evans. Would the House please make him welcome. B. Lekstrom: Joining us in the House this afternoon are two friends of mine and workers for the B.C. Coali- tion of Motorcyclists. They advocate on behalf of mo- torcycle rights across British Columbia. Joining us to- day, we have Adele Tompkins, who is the executive director, as well as Shannon McNeney, who is the ad- ministrative coordinator. Will the House please join me in welcoming them. Hon. R.

Neufeld: It's a pleasure for me to introduce to the House several people that work with the Minis- try of Energy and Mines, who are here today to receive their commemorative medals for the Queen's Golden Jubilee. They are Ross Curtis and his wife Loraine; Pat- rick O'Rourke; Gerald German; and Ron Smyth, ac- companied by his wife Ruby, his mother Lucy Smyth and his sister, Avril Ridley. Would the House please make them welcome. K. Stewart: Joining us today from Pitt Meadows, we have the chair of the municipal insurance associa- tion. Would the House please make welcome council- lor Janice Elkerton. V.

Anderson: I would ask the House to join me in welcoming two distinguished B.C. educators: Bob Lindsay and Stanley French of the B.C. Principals and Vice-Principals Association. [1410] T. Christensen: Many members in this House will know my very hard-working and capable constituency assistant, Min Sidhu. Another thing we all know is that elections are about numbers. Not to be outdone, al- though my congratulations go out to the member for Vancouver–Mount Pleasant and her family, my con- stituency assistant Min on Friday, March 7 welcomed

5418 B RITISH COLUMBIA DEBATES T UESDAY, MARCH 11, 2003 into the world her and her husband Sid's third daugh- ter. It's my privilege to welcome one of my newest con- stituents, Dilan Kaur Sidhu, who was born last Friday. Hon. G. Campbell: Since we're celebrating today, I think it's important for us to recognize that this is In- ternational Women's Week. It is important for us to celebrate the contribution that women have made to our country, to our history, to the society we live in — women in history, like Emily Murphy, Louise McKin- ney, Nellie McClung, Henrietta Muir Edwards and Irene Parlby.

The Famous Five are memorialized in bronze on Parliament Hill in Ottawa for the contribu- tion they made in changing the status quo and making the world a better place for all of us. This is a time to celebrate Mary Ellen Smith, who was first elected to this Legislature in 1918 and was indeed the first Speaker of this Legislature. We can remember the first woman mayor in Can- ada, Mayor Norah Arnold, from the city of Prince Rupert in our great northwest. Nellie McClung is buried here in Victoria.

I'm sure you'll all recall her motto, which was "Get the job done and let them howl." She is now buried here in Victoria, and her gravestone says that she is loved and remem- bered. Of course, it's a British Columbian who sits as the Chief Justice of the Supreme Court of Canada, Beverley McLachlin. Here in B.C. the head of the RCMP E divi- sion and M division is Beverley Busson. Of course, our first woman Lieutenant-Governor, Iona Campagnolo, today sits in Government House and presides over our province.

It is always important for us to remember the con- tribution of all British Columbians, but this is a special time for us to recognize the contribution of the women o f t h i s p r o v i n c e w h o h a v e m a d e t h i s s u c h a n e x c e p - tional place for all of us to live. Introduction and First Reading of Bills COMMUNITY CHARTER Hon. T. Nebbeling presented a message from Her Honour the Lieutenant-Governor: a bill intituled Community Charter. Hon. T. Nebbeling: I move that Bill 14 be read now for the first time. Motion approved. Hon. T. Nebbeling: I'm pleased today to present the community charter.

It's been a long time in the making, and as a consequence of much work that has been done by many stakeholder groups, we have cre- ated the most empowering local government legisla- tion in Canada. Today we are fulfilling our commitment in the New Era document regarding the community charter by honouring a long-standing request of local govern- ments. In 1991 the Union of B.C. Municipalities intro- duced the bill of rights for local governments. The principles of this bill of rights have directed the crea- tion of the community charter.

From the beginning of this legislative process we have worked with the UBCM and other stakeholders. Their input was invaluable, as was the work of the Community Charter Council. We've also received a tremendous amount of input from local governments, from business sectors, from labour groups and from many individuals. The result is today's community charter. It is concise legislation, balancing enhanced municipal powers with increased public accountability. Local governments will have greater autonomy to make decisions on the delivery of municipal services. This is for the benefit of their citi- zens.

Municipalities are in the best position to make local decisions for their citizens and for their communi- ties. They are the level of government closest to the citizens, and the community charter reflects that. [1415] In short, municipalities can be more responsive and proactive. With the community charter, they are now active leaders in shaping the destiny of their communi- ties. Innovative local governments are key to a solid economic base for our entire province. Strong local governments are key to the revitalization and economic growth of British Columbia.

I move that the Community Charter be placed on the orders of the day for second reading at the next sitting of the House after today. Motion approved. Bill 14 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. MOTOR VEHICLE AMENDMENT ACT, 2003 Hon. R. Coleman presented a message from Her Honour the Lieutenant-Governor: a bill intituled Motor Vehicle Amendment Act, 2003. Hon. R. Coleman: I move that Bill 17 be read a first time now. Motion approved. Hon. R.

Coleman: A decision was made at open cabinet last November to transfer ICBC's compliance operation department to government. Since the man- date of this ministry is also public safety, it is a natural fit, and I am pleased that this

section is moving to the Minister of Public Safety and Solicitor General. Compliance operations enforces standards for commercial vehicle carriers, vehicle inspection facilities and weigh scales. Its mandate is to reduce the instance and severity of commercial vehicle accidents. The op- eration will become part of our future integrated traffic

TUESDAY, MARCH 11, 2003 B RITISH COLUMBIA DEBATES 5419 enforcement strategy. The amendments to this bill transfer these functions to government, streamline ser- vices and enhance public safety. I move that the bill be placed on the orders of the day for the second reading at the next sitting of the House after today. Motion approved. Bill 17 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. Statements (Standing Order 25

B) B.C. INTERIOR FORESTRY MUSEUM W. McMahon: One of the things that enshrines the history of Revelstoke is forestry. The contribution it has made to the growth of this community is so great that it is impossible to measure. As our economy grows and diversifies, it is important to remember the staples that built this wonderful community. Revelstoke is located on the Columbia River be- tween the Selkirk and Monashee mountains at the western entrance to Rogers Pass on the Trans-Canada Highway. It is named after Lord Revelstoke, head of a London banking firm. The city incorporated on March 1, 1899.

Forestry plays an important role. In recognizing this, the fledgling B.C. Interior Forestry Museum has opened in Revelstoke. Coming into its third season at Columbia View Park, the forestry museum staff and society have managed to fill its 2,200-square-foot floor space and most of the wall space with artifacts and displays preserving the history of forestry in the south- ern interior of British Columbia. Each of the first two seasons saw approximately 7,000 visitors attend the museum.

To date, the society has collected 11 pieces of vintage heavy equipment including a 1956 Hayes logging truck and a 65-foot- high yarder made with surplus World War II parts. I understand this was often the case for logging equip- ment in the forties and early fifties. Expansion plans are already on the drawing board for the B.C. Interior Forestry Museum.

The society has received a licence for 30 acres of land for expansion to an interpretative centre, including an 11,000-square- foot replica of an early 1900s sawmill from the Kam- loops area, a first nations cultural display, a logging camp and interconnected nature trails. The society is also working on salvaging a rare 1918 McGriff log loader which is mired on the beach in Galena Bay and recreating the first nations summer village, circa 1830. Through fundraising, the B.C. Interior Forestry Mu- seum society hopes to start building trails and clearings this summer.

Forestry is the lifeblood of this province, and it's important that we continue to recognize the heritage value of an industry that has built this province. [1420] KOOTENAY STORYTELLING FESTIVAL B. Suffredine: O n b e h a l f o f t h e c o m m u n i t y o f Harrop-Procter, I want to extend an invitation. The village of Procter exemplifies the high quality of life that we in the heartlands of British Columbia enjoy. Its only connection to the rest of the world is a short, free ferry ride available 24 hours a day. If I could use props in this chamber, I would be standing on a Kootenay storytelling soapbox.

There's a story attached to the Kootenay storytelling soapbox, but I don't have time to tell it today. The soapbox is a communications tool with strict rules that, if followed, resolve conflict, simplify child-rearing and enhance spousal dialogue. The soapbox even played a role in the successful resolution of the inland ferry issue. I carry a soapbox with me as I travel through my riding. Made from wood harvested from the Harrop-Procter Community Forest, it is a value-added wood product.

The community spirit of Harrop-Procter manifested itself five years ago in the Kootenay Storytelling Festi- val, which is a celebration of Kootenay heritage told by colourful characters from all corners of the Columbia River basin. A former schoolhouse, a decommissioned church and a community hall are all venues for that purpose. The festival is a matter of community pride and British Columbia pride. Plans are being made for year-round performance events and a storytelling craft store to create part-time income for local residents.

The storytelling executive shares the provincial goal of doubling tourism revenues by 2010. The fifth annual storytelling festival extends an invitation to all members of this House and to all Brit- ish Columbians: come to Procter July 5 and 6 to share in the celebration of our past and our future. Bring your story. We'll provide the soapbox. McDONALD FAMILY INDEPENDENT POWER PROJECTS B. Bennett: Today I'm telling the great story of one of B.C.'s pioneer families and one of the province's first independent power projects.

McDonald Ranch and Lumber is a three-generation family business located just above the Montana border at Grasmere. John A. McDonald of Nova Scotia, a carpenter, moved up to Fernie from his job in Nanaimo to help Fernie rebuild after a fire destroyed the town in 1906. In 1923 John bought a farm at Grasmere, which he and his family worked to supply the region with apples, potatoes, beef, Christmas trees, lumber and railway ties. In 1928 with the Grasmere Valley lit only by kerosene lanterns, Jack McDonald fed the water from Rainbow Creek through a small pelton wheel to power his small saw- mill and grain grinder.

This IPP powered the ranch, sawmill and McDonald homes for 30 years from 1928 until 1958. Following in his father's footsteps, Jack's son Doug, who's now 82, and his brother Andy constructed a con- crete dam on Phillips Creek in the early 1980s, installed

5420 B RITISH COLUMBIA DEBATES T UESDAY, MARCH 11, 2003 a 600-kilowatt GE generator and 2,000 feet of used 16- inch steel gas pipe, built 10,000 feet of wood-pole dis- tribution lines and installed the necessary substations. The government of the day told Doug that the project would cost millions to design and construct, but with a lot of hard work and innovation Doug McDonald built his Phillips Creek IPP for $90,000 and completed the circle of family history with the company and the fam- ily becoming self-sufficient again as it had been from 1928 to 1958 under his father.

Mac hydro, as the family calls it, was British Co- lumbia's first small hydroelectric project to tie into the B.C. Hydro grid. Now Doug and Andy's sons, Barry and Cam and their own children, run the ranch and the sawmill planer business using the hydro power from Phillips Creek. Hats off to the entrepreneurial pioneer McDonald family of Grasmere, British Columbia. Mr. Speaker: That concludes members' statements. Oral Questions FAIR PHARMACARE PROGRAM INCOME-TESTING MODEL J. MacPhail: When the Minister of Health Services announced his new income-testing scheme, he said that low-income seniors were protected.

Can the minister tell the House today how many seniors on low incomes are worse off as a result of his Fair Pharmacare income- testing scheme? Hon. C. Hansen: What I said at the time of the an- nouncement is that the majority of seniors in this province would be either better off or the same under the new Fair Pharmacare program. I think when you start asking ques- tions about how many are affected who are low-income, it comes down to a definition of what low income is.

By and large, low-income seniors and low-income British Colum- bians will be much better off under the Fair Pharmacare program, when it comes into effect. Mr. Speaker: Leader of the Opposition has a sup- plementary question. [1425] J. MacPhail: The minister says that it depends on what you define as low income. I'd say it's a safe bet to say seniors with a family income of $15,000 or less is a low-income family.

According to a Fair Pharmacare technical briefing document obtained by the opposition, 20,000 senior families with incomes below $15,000 a year are worse off under his new scheme — according to his own document. That is 25 percent, one in four of all sen- iors with household incomes under $15,000 a year. Again to the minister: why did he withhold this infor- mation when he announced income testing, and can he tell us how these families will now be worse off? Hon. C.

Hansen: I know that the member likes to think she has sources in the ministry, and I think last week we saw her apologize for some documents she made claims about that weren't factual. There have been thousands and thousands of pages of material generated as we have developed the Fair Pharmacare plan to make sure it is indeed fair for Brit- ish Columbians. I would say there are probably over 200 different iterations of the plan that were developed and run through the software systems to determine exactly how it would affect different income groups. I would caution her on using any particular piece of information.

What we did look at in some of that was not just at the ceiling that would be there, which an individual would have to pay, but also the cash flow that some senior families and other families would be facing as well. I can say unequivocally that there is not one sen- ior household in British Columbia earning under $18,000 a year that would wind up with a larger ceiling under the new plan than they had under the previous plan. Mr. Speaker: Leader of the Opposition has a fur- ther supplementary. J. MacPhail: Wow, that sure gives new meaning to waffle, waffle, waffle.

That wasn't part of the great spin or the news ads that this government is putting on over and over and over. This is a Fair Pharmacare technical briefing docu- ment. The Minister of Health Services told British Co- lumbians that his new scheme was fair. He produced lots of charts, graphs and case studies to help spin that story, but he forgot to include this chart — this chart right here that was prepared for him and tells the whole story. Let's see: 25 percent of seniors with family incomes of less than $15,000….

I bet you even Liberals have to admit that seniors with family incomes of $15,000 or less are low income. Twenty-five percent, according to this, are worse off. Thirty-four percent of families with income between $15,000 and $30,000 — family income — 34 percent worse off. That's over 73,000 low-income senior families who are worse off under this new scheme — no messing around. Again to the minister: why did he say over and over again that low-income seniors would be protected when his own technical briefing papers tell him that isn't true? Hon. C.

Hansen: I recognize that the member's time is certainly stretched in her ability to fulfil her role as an opposition member, and that's obviously going to be more of a challenge now that the member for Vancouver–Mount Pleasant is away. I have offered this member a briefing on Pharmacare, and she has yet to take me up on that. I think if she had, she would understand where this document fits in.

I can say un- equivocally that a senior household — even a senior one-member family, a senior living on their own — earning less than $18,000 a year will pay less under the new Fair Pharmacare program in terms of their annual

TUESDAY, MARCH 11, 2003 B RITISH COLUMBIA DEBATES 5421 ceiling than they would under the current Pharmacare program. Interjections. Mr. Speaker: Order, please. Order, please. AFFORDABILITY OF ASSISTED-LIVING MODEL P. Sahota: My question is to the Minister of State for Intermediate, Long Term and Home Care. Nikkei Place in Burnaby is a 59-unit assisted-living complex for Japanese Canadians in their retirement. This facility opened up last year, and it allows its residents to live independently while providing them with 24-hour emergency care.

There are many seniors who live on fixed incomes in my riding, who are concerned about being able to afford these types of facilities. Can the minister ensure my constituents that facilities like the Nikkei Place will remain affordable for low-income seniors? [1430] Hon. K. Whittred: Indeed, assisted living is a new option of care that we are offering to the seniors in Brit- ish Columbia through partnerships with B.C. Housing, the non-profit sector and the health authorities. The one in this member's riding is one that I had the pleas- ure of opening not long ago, along with the Premier.

It is an excellent example of this new offer of care. We are concerned about this option being affordable, and for that reason, we have adopted a plan that says that no resident will pay more than 70 percent of their income for assisted living. Interjection. Mr. Speaker: Order, please. The member for Saanich South. Interjections. Mr. Speaker: Order, please. Interjections. Mr. Speaker: Order. The member for Saanich South has the floor. REGULATION OF BARBERS AND COSMETOLOGISTS S. Brice: My question today is for the Minister of Skills Development and Labour.

The minister is elimi- nating the requirement for barbers and cosmetologists to belong to their association. I realize this is a deregu- lation initiative, but some of the barbers and cosme- tologists in my riding are concerned that it could cause a devaluation of their skills in the marketplace. Could the minister please explain to those in this field in my constituency why this initiative is being taken? Mr. Speaker: The Minister of Skills Development and Labour. Interjection. Hon. G. Bruce: The Leader of the Opposition wasn't referring to some of the other members in this House with that comment. Interjection.

Mr. Speaker: Order, please. Hon. G. Bruce: The barbers and cosmetologists acts, brought in in 1928, are now well superseded by three other acts in the province: the establishment regu- lation under the Health Act, the Consumer Protection Act and also the ability to utilize the Society Act to be- come a self-regulating body. In our bid to remove some regulations in British Columbia — there are some 1,200 regulations in this respect — we feel that the consumer can be well protected, from a health and safety point of view, with the acts that are currently in place. DRUG COURTS AND MENTAL HEALTH COURTS L.

Mayencourt: My question is to the Attorney General. Just a little over a year ago, we instituted drug treatment courts in Vancouver as an alternative means for addicts to access the justice system and to gain ac- cess to treatment and community services that can help them out of a cycle of crime and addiction. I believe that this program is doing a lot to create a safer com- munity in my neighbourhood. New Brunswick and Washington State have recently implemented mental health courts to offer similar options and tremendous benefits to a vulnerable population.

To the Attorney General: is he considering this alternative justice model to assist the mentally ill in British Columbia? Hon. G. Plant: Well, we are monitoring the drug treatment court. There are some early indications that it's doing what we hoped it would do, but we do in- tend to conduct a rigorous evaluation. It's also clear, though, that many people find themselves in a criminal courtroom in circumstances where they are probably there because of a mental disorder, as much as any- thing else.

I think it's time that we began a focused conversation in the criminal justice system, involving all of the participants, about how we can deal with that. Mental health courts have been tried in some juris- dictions with success. We're looking at that as an idea. It's early days yet, but I do think it's an initiative worth giving serious consideration to, and I appreciate the member's interest and look forward to his contribution

5422 B RITISH COLUMBIA DEBATES T UESDAY, MARCH 11, 2003 to that continuing discussion as we look for ways to make our criminal justice system work better for all. [1435] GRAVEL EXTRACTION FROM FRASER RIVER J. Les: My question is to the Minister of Sustainable Resource Management. The Fraser River is an impor- tant economic and environmental asset for all British Columbians. In the area of the Fraser River extending from Hope through Chilliwack, about 350,000 tonnes of gravel are swept into that portion of the river every year.

It's important to remove that gravel to alleviate flooding concerns and also to improve fish habitat. Six years ago the Department of Fisheries and Oceans de- cided to put a moratorium on the removal of that gravel, which has a lot of my constituents and constitu- ents throughout the Fraser Valley concerned. My ques- tion to the minister is: what has been happening lately to ensure that this gravel will be removed to improve safety concerns and to improve the Fraser River envi- ronment for fish? Hon. S. Hagen: It certainly is a serious issue.

Some of us, as a matter of fact, are old enough that we can actually remember the flood of '48. That's 1948. It's a very serious issue. I had the privilege of meet- ing with many of the local mayors and also first nations last week, and I'm pleased to announce that after a lot of work — months and months of work bringing together the Department of Fisheries and Oceans, first nations, my staff, mayors and municipal people — we now have a go-ahead to remove 200,000 cubic metres in that area.

We're working to increase that for next year, be- cause it's something that has to happen every year, or it will continue to build up. If we get water coming over the dikes…. In some cases, the water has built up so high that the water is actually seeping under the dikes, which is almost as bad for the crops. We're working very hard on doing that, and I'm pleased to announce we have the okay now to remove 200,000 cubic metres. We'll continue to work it out. FUTURE OF B.C. RAIL J. MacPhail: B o y , M r. S p e ak e r, i t 's p ro b ab l y b e t t e r in these coming days to just televise the Liberal caucus meeting.

It might be a little more exciting than this. Interjections. J. MacPhail: The unfortunate fact for the Govern- ment House Leader is that the public doesn't agree with him. City councils and regional districts are demanding open public consultation with their citizens around the future of B.C. Rail. I'm sure the minister is ready for this question. The corporation projected a $61 million profit for this year. I discussed this at estimates with the Minister of Finance, and he confirmed it. To the minister responsible for rail: why is the gov- ernment proceeding with plans to privatize B.C.

Rail when it's showing a big profit for government? It is proceeding with privatizing parts of B.C. Rail. Will the minister listen to those interior communities, the ones that they seem to care so much about, and ask the pub- lic what they think before she betrays the Premier's promise not to privatize B.C. Rail? Hon. J. Reid: It was exactly because we were in Prince George discussing with people the future of B.C. Rail that we listened to them. They said the status quo wasn't working. For anybody who understands what is going on with the forest industry… Interjections. Mr. Speaker: Order, please. Hon. J.

Reid: …in this past year, there has been an anomaly in the amount of wood that's being taken out. With that, B.C. Rail has been working with the industry to be able to accomplish that. This is not expected to be long term, and it doesn't take away from any of the problems that exist in B.C. Rail and their ability to be able to serve the… Interjection. Mr. Speaker: Order, please. Hon. J. Reid: …northern communities in a healthy and sustainable manner.

As we've talked with the communities and talked about improving freight rail transportation for the north and for the industries of the north, because healthy industries mean healthy communities, we have said there will be a consultation process. We are work- ing right now to finalize the details of that process. [End of question period.] Petitions J. MacPhail: I have two petitions to table. For the first one, I rise to table a petition that joins with the 5,716-signature petition I tabled last week that called for the government to rescind all cuts to B.C. Phar- macare — probably more relevant today.

I also rise to table a petition signed by over 750 Brit- ish Columbians, which calls upon the government to eliminate the hardships caused by cuts to health care and increases to MSP and other user fees — even more relevant today. [1440] Orders of the Day Hon. G. Collins: In Committee A, I call Committee of Supply. For the information of members we'll be

TUESDAY, MARCH 11, 2003 B RITISH COLUMBIA DEBATES 5423 debating the estimates of the Ministry of Transporta- tion. In this chamber I call committee stage of Bill 6. Committee of the Whole House BUDGET MEASURES IMPLEMENTATION ACT, 2003 The House in Committee of the Whole (Section

B) on Bill 6; J. Weisbeck in the chair. The committee met at 2:43 p.m.

Section 1 approved. On

section 2. J. MacPhail: Could the minister please explain the changes that this

section brings in? Hon. G. Collins: The normal process for the filing of the reports from ministers of state would be with the report on accountability, which is disclosed along with the public accounts. We anticipate public ac- counts this year to be complete if not by the end of June, then early July. We're working towards the end of June.

Part of the challenge with the ministers of state in the health sector is that a lot of the data that they need in order to determine whether or not they've met their objectives is not produced by the other bodies — CIHI and other health data trackers — until later in the year. This allows for that data to be collected, verified and measured before the ministers are eligible for the recovery of the salary that was set aside earlier in the year. What it means on their

part is that, first of all, we have better data for determining whether or not they've met their targets and, secondly, that they need to wait much longer before they're eligible to receive the salary set aside from the previous fiscal year. This takes it as late as December 31. I think most of the health data should be in, in the September-October- November window — is my understanding. Then the assessment can be done, and an evaluation and report would be made at that time. J. MacPhail: And why are they singled out? Hon. G.

Collins: That's because a lot of the data collected for the health care measures outcomes are collected by other agencies. The federal government agency called CIHI…. I can't remember what the acro- nym stands for, but it's the health data tracking…. Interjection. Hon. G. Collins: Yeah, thank you. The Canadian Institute for Health Information. That information isn't available until later in the year, so they're going to have to wait until such time as we can get that data. That's what is driving that change. J. MacPhail: Mr. Chair, I need a five-minute recess, if I may, please.

The Chair: Take a five-minute recess. The committee recessed from 2:45 p.m. to 2:52 p.m. [J. Weisbeck in the chair.] Introductions by Members Hon. R. Coleman: I seek leave to make an introduc- tion. Leave granted. Hon. R. Coleman: Joining us in the gallery today are 45 grade 11 students from the great school of Wal- nut Grove Secondary in my riding. They are accompa- nied by teacher George Kozlovic and Stewart Masi. Would the House please make them welcome. Debate Continued

Section 2 approved. On

section 3. J. MacPhail: I have a series of questions around gas tax increases. Perhaps the minister could explain this section. I'll read this

section out, the explanatory note. This

section "increases by 1 cent per litre the amount of tax to be collected within the area prescribed under the Build BC Act." Is this an increase of 1 cent? Hon. G. Collins: No. I just want to, if I may, extend the welcome to the students from Walnut Grove Secondary. That used to be my riding in 1991 to 1996. I lived about half a block awa y f ro m t he s c ho o l , s o I w ant e d t o e x t e nd m y we l - come as well. I hope they enjoy their visit. It's not going to get a lot more exciting here today, but you're wel- come here anyway. You never know, though.

In response to the question from the member oppo- site, on April 1, 2000, and June 1, 1999, the previous gov- ernment made some changes to the tax at that point in time. We subsequently found out — i.e., not too long ago — that the regulations required to put it in place were never passed. The legislation was passed, but the regula- t i o n w a s n o t p a s s e d . I n a n e f f o r t t o g o b a c k a n d c l e a n that up, we're now making a change to the legislation to do that — to make that legislation effective at that date. We're really cleaning up an error that was made some time ago.

There's no increase over and above what's been there since that period of time — i.e., this tax has been collected over that period of time. It's just that the regulation was not in place to allow it to happen. J. MacPhail: So there is no increase in the tax. Per- haps the minister could point to the

section that identi- fies the increase of 3.5 cents per litre.

5424 B RITISH COLUMBIA DEBATES T UESDAY, MARCH 11, 2003 Hon. G. Collins: It's 21. J. MacPhail: On

section 3, what is the amount of that fuel tax that goes into the Build B.C. account now? [1455] Hon. G. Collins: I'll try and get that number for the member. This is just retroactively doing what's been in place for a period of time, but I can try and find that number for the member. I'm sure staff is watching, and we'll try and get it in here as quickly as we can. J. MacPhail: The reason why I was asking is be- cause I want to know whether the act still confirms that this is a dedicated revenue source. Hon. G. Collins: Nothing in this

section will change what was there previously. All it does is vali- date what's been happening for the last period of time. J. MacPhail: Sorry. So nothing changes in terms of it being a dedicated revenue source? Hon. G. Collins: That's correct. Sections 3 and 4 approved. On

section 5. J. MacPhail: Can the minister tell the House how many corporations are affected by the change in the threshold amount for the corporation capital tax? Hon. G. Collins: I remember having a similar de- bate in opposition with the Minister of Finance at the time. They made a threshold change. In the debate where I was asking how many and which ones, I was told at the time that not only was the minister not able to say which ones, but the minister couldn't say how many because it might indicate which ones. It is a tax issue, and we're not able to disclose which entities would fall within that category.

I think the budget explanation stated that there were a number of small financial institutions as well as credit unions that would be affected by this threshold change. I think that's the extent to which I'm able to comment for the member. J. MacPhail: In my research, I thought that this was a different clause than what we debated before in terms of that the section…. The one that we used to debate was around…. Interjection. J. MacPhail: Yes, exactly. Hon. G. Collins: I understand the comment by the member that what we debated had to do with the lar- ger financial institutions.

These are the smaller ones, but the same principle applies. J. MacPhail: I hope at some point the minister and I will change our responsibilities so they'll know we're not debating by hand signal. Hon. G. Collins: We just know each other so well. J. MacPhail: Exactly, yeah. Fine. Sections 5 to 11 inclusive approved. On

section 12. J. MacPhail: Would the minister please explain this? The explanatory note says that the

section "re- moves provisions made redundant by the addition of

section 21.1 to the Taxation (Rural Area) Act by this bill." It's changes to the Greater Vancouver Transporta- tion Authority Act. [1500] Hon. G. Collins: As the budget stated, there were…. The surveyor of taxes charges a fee to a num- ber of taxing authorities as part of the taxation process. We're trying to streamline that. There are some areas where the surveyor of taxes currently doesn't charge a fee. We're anticipating they will start to charge. There are areas where they currently charge a fee that the fee will probably go down in an effort to manage that.

So, there will be no net change in the revenue in- volved. We're trying to do it on a more equitable basis. There are a whole series of sections of this bill that im- pact that. Let me just try and give a couple of examples if I can. This

section 12 eliminates the opportunity for them to charge the fee to the GVTA. The same will happen for the Islands Trust Act in

section 16, under the Local Government Act in sections 18 and 19, the Local Services Act in

section 20 and the University En- dowment Land Act in

section 50. What we are doing in

section 46 is giving all of those opportunities under the T a x a t i o n ( R u r a l A r e

a) A c t . I t ' s r e a l l y j u s t m o v i n g t h e authority from one act to another. In three entities, there will be the opportunity to charge those fees in order to recover the cost of the process. Those are B.C. Transit, the hospital districts and the Municipal Fi- nance Authority of B.C. J. MacPhail: Is this change needed because of any other legislation — for instance, the community charter? Hon. G. Collins: No. We're just trying to streamline it, put it into that one act and clarify it — as well as making it more equitable — so those collections of fees reflect the services that are provided without generat- ing any new revenue. Sections 12 to 14 inclusive approved. On

section 15. J. MacPhail: This is an increase of another tax by 0.4 percent. It increases the tax payable in respect of

TUESDAY, MARCH 11, 2003 B RITISH COLUMBIA DEBATES 5425 property insurance and automobile insurance by 0.4 percent — so from 4 percent, now payable, to 4.4 per- cent. How much is collected prior to the tax increase, and how much will be collected after the tax increase? Hon. G. Collins: We currently collect about $210 million. The change will result in approximately an additional $14 million. J. MacPhail: There have been people who suggest that this should be dedicated. I'm sure the minister has been lobbied by those who would suggest that this should be a dedicated tax, particularly in the area of….

I think I've received lobbies — and I use that in the most positive sense — from municipalities and fire- fighters. Is this going to be a dedicated tax increase? Hon. G. Collins: No, it will not be designated to any specific purpose, although it does help offset a lot of the costs that we have on the firefighting side, par- ticularly forests. Some of the forest fires are caused by p e o p l e o r b y h o u s e s c a t c h i n g f i r e o r b y a u t o m o b i l e s catching fire by the side of a highway — those sorts of things. It will help government's general revenue.

Ob- viously, there are pressures in general revenue around firefighting. I suppose one could tangentially link them, but it's not a dedicated tax. Sections 15 and 16 approved. On

section 17. [1505] K. Krueger: I wish to speak to

section 17 and inquire of the minister. We have a Lafarge Canada plant in the constituency of Kamloops–North Thompson. It was built a number of years ago, and when it was built, La- farge built a bridge across the South Thompson River, which is a real boon to my constituents — an excellent bridge. They gifted it to the public for a dollar, which is a very much appreciated gift and very useful for a lot of my constituents.

The city of Kamloops, in that day, re- turned the favour by throwing out a taxation corridor, as I understand it, to encircle the plant and make sure that in future it would contribute to the coffers of the city — which is not uncommon, of course. The plant currently pays about $400,000 a year in taxes, and they do not re- ceive a whole lot of services in return. People have settled around the plant and com- plained about the dust and particulate matter in the atmosphere.

Lafarge eventually, in collaboration with government, went to considerable expense to construct a dust containment shed so that problem would be ameliorated. They haven't had to pay tax on that shed because it hasn't been included in their assessment up until now. There was some dispute over that, and La- farge took it to the Property Assessment Appeal Board, the Supreme Court of British Columbia and eventually the British Columbia Court of Appeal.

The outcome was a confirmation that, as I say, up until now they didn't have to include that shed, which really has no other purpose than to protect the environment and resolve the concerns of the neighbours. They wouldn't have to pay tax on the shed unless a change like this one is made. I've had some expressions of alarm from Lafarge. The plant in Kamloops is viable, but it's been somewhat marginal in recent years, particularly because of the ter- rible slide that the economy took during the 1990s.

In fact, we went from the best-performing to the worst- performing economy in Canada, and there wasn't nearly as much construction in British Columbia demanding their products as there would have been if the econ- omy had continued as a robust economy. Obviously, my concern is my constituents' concern. There are dozens of my constituents who work at that plant. They're family-supporting jobs. I'd hate to see it disappear. I'm told that this will add to their taxes about $150,000 a year, and it's going to put the viability of the plant into question. I wonder if the minister could response to those concerns. Hon.

G. Collins: I appreciate the comments by the member for Kamloops–North Thompson, and I appre- ciate him bringing this issue to my attention person- ally. There are three sections.

Section 17 is the first one that starts that process. There are two others in the bill, as well, that are intended to deal with the same issue. It was always government's intention that the property be taxable and the improvements be taxable, but that the equipment contained within would not be part of the assessment. That was government's intention right from the start. I understand the comments made by the member. The way the legislation is drafted, for those years they were assessed — but this had been in dispute — there would be no tax owed — i.e., this is not retroactive.

It is not intended to go back and force a tax payment for those years in the past. So in that regard, they will not be impacted by it. This legislation is intended to come into force De- cember 31, 2003 — so for the 2004 taxation year — and it is to clarify what government's intention had been all along. I understand that what triggered this legislation is, in fact, the appeal and the court case that went through the Supreme Court. So government's effort here is to try and clarify the legislation to make it clear what it is government is trying to achieve.

I take the comments of the member to heart, how- ever, on the impact…. I certainly would be glad to hear from him, as I expect I shall, as well as from the busi- ness as to how this may impact them. We review taxa- tion policy on an annual basis obviously, and certainly if there are big problems…. However, it is the intent of government to pass this legislation. I would be more than happy to meet with the member and anyone he would choose to bring along to discuss the issue and see if there is some fairness issue that needs to be dealt with.

I'm more than open to that, but it is the intention of the government to pass the legislation. It will not come into place until December 31 of this year, so there is some time for us to do that. I just want to caution the

5426 B RITISH COLUMBIA DEBATES T UESDAY, MARCH 11, 2003 member, as well as the individuals impacted, that that is in fact exactly what government is attempting to do. I understand they may be uncomfortable with that, and I'm certainly more than happy to discuss it, but we are going to proceed with the legislation at this point. [1510] K. Krueger: I appreciate the minister's commit- ment, and I'm sure my constituents will want to take him up on that and have a meeting about this matter. Obviously, I have the same concerns with sections 45 and 51, just to put them on the record. I won't interrupt the debate further with that point. Sections 17 to 20 inclusive approved. On

section 21. J. MacPhail:

Section 21 is the 3.5-cents-per-litre tax increase imposed by this government. It's split into two. I just want to get, first of all, the facts on the re- cord. It says that one will be a 1.25-cent-per-litre in- crease in tax payable on purchased gasoline. That's under

section 21. But I also see that

section 23 — I'm just worried about votes here — increases by 1.25 cents per litre the tax payable on purchased motive fuel, so we're up to 2.5 cents. Where is the other increase of 1 cent per litre? Hon. G. Collins: Sections 21, 22 and 23 deal with the 1.25-cent-per-litre tax that previously was desig- nated to the B.C. Ferry Corporation. As the B.C. Ferry Corporation changes its structure as a result of core review and becomes an authority, rather than receiving a direct fuel subsidy from tax revenue from fuel, they will enter into a service contract with the Crown in an effort to provide the services.

They'll be paid in the form of a contractual payment. That will be much more transparent. It won't be buried in the Crown. It will actually be transparent. It will be there. It will be an agreement to contract between the Ferry Services cor- poration and the government of British Columbia. What was previously there in the form of a 1.25- cent fuel tax revenue stream will disappear, and that will go into government's general revenue. In turn, government will issue them a cheque for the services they render.

Sections 21, 22 and 23 just comb through the previous legislation and reverse that 1.25-cent-a- litre that was sent directly to the B.C. Ferry Corpora- tion, and it's

section 24 where we start to get into the new tax revenue, the 3.5-cent-per-litre increase. J. MacPhail: I beg your indulgence here, Mr. Chair. We're combing through sections here.

Section 25 actu- ally removes the tax for the raising of revenue for the purposes of the British Columbia Ferry Corporation on purchased gasoline or motive fuel. I assume

section 25 removes it and sections 21, 22 and 23 add it back into general revenue. Is that…? Hon. G. Collins: That's correct. [1515] J. MacPhail: In the estimates of the Ministry of Fi- nance we had a discussion about the service contract. At that time the auditor general still hadn't signed off on the whole concept of a service contract demonstrat- ing enough independence or being enough of an indi- cation that there be no subsidies flow, and therefore the corporation would then be permitted to borrow pri- vately and not have the debt on book, on the govern- m e n t ' s b o o k s .

I t s e e m s t o m e t h a t r e m o v i n g t h e d e d i - cated gasoline tax to the B.C. Ferry Corporation is jumping the gun. What happens if the auditor general comes out with a rule that indeed the corporation is not independent enough of government? Does the minister still plan on proceeding with the service contract? Hon. G. Collins: It is a hypothetical. We still antici- pate that the core review of B.C. Ferry Corporation and the new governance structure will take place effective March 31 to April 1. We continue to work through that.

It's a fairly complicated structure, and there's lots of back and forth. I don't anticipate at this point that we should have any big problem with that, but as the member knows, there are always lots of details with the drafting of the legislation that would take it into e f f e c t t o m a k e s u r e t h a t g o v e r n m e n t i s a c h i e v i n g t h e end result.

Regardless, however, of what the final determina- tion is — in-entity or out-entity — or what the legisla- tion actually looks like, it is anticipated that this is a better, more transparent way of funding the Ferry Cor- poration, rather than through the designated taxation revenue stream. There will be a contract in place. The Ferry Corporation has that with government, and that will be their revenue stream as opposed to the revenue through the gas tax. Sections 21 to 23 inclusive approved. On

section 24. J. MacPhail:

Section 24 is the

section that increases gas tax on motor fuel by 3.5 cents a litre. I want to ex- plore this a little bit. We did explore some of this in the Ministry of Finance estimates. I don't plan on going over it again except to confirm what I gleaned from the Ministry of Finance estimates, which is that this will be a tax dedicated to improving roads and bridges, and that there will be a separate accounting of these expen- ditures reported annually. Now, I want to just ask the minister whether…. There is GST on gas tax. What is the revenue increase to the federal government from this increase on pro- vincial gas tax? Hon.

G. Collins: It's 0.245 cents per litre. J. MacPhail: Okay, so we could say a quarter of a cent, just to…. How much does that raise annually? We know that this increase in tax will cost people $211

TUESDAY, MARCH 11, 2003 B RITISH COLUMBIA DEBATES 5427 million, I think, annually. What is the GST increase that goes to the federal government? Hon. G. Collins: I'm just doing the math in my head, but I think it's about $20 million a year roughly. J. MacPhail: Is there PST paid on gas? Hon. G. Collins: No, there isn't. J. MacPhail: We already know that hundreds of millions of dollars go to the federal government from British Columbians in gas tax revenue.

Has there been any discussion with the federal government by this provincial government about the $20 million extra that will now be paid by British Columbians to the federal government as a result of this gas tax increase? Hon. G. Collins: We have been discussing with the federal government, since probably days after the last election, a series of agenda items, one of the largest ones being the federal funding of transportation infra- structure. We continue to do that. This is a small com- ponent. We're not just looking for $20 million.

We're looking for a lot more than that from the federal gov- ernment, because the member is correct. The federal government brings in hundreds of millions of dollars a year in tax revenue related to fuel, and we get almost nothing back — and historically certainly have not. [1520] We have been in negotiations and discussions con- stantly with the federal government. We're starting to see some benefit from that with the announcement of the federal participation in the improvements to the Kicking Horse Canyon, as well as the border infrastruc- ture transportation initiative which was announced.

There are others where we think the federal govern- ment should and very likely will end up being a part- ner, and we're going to continue to pursue those very aggressively, as we have for the last almost two years. J. MacPhail: This is going to cost, as I said already, about $211 million out of people's pockets, and it is going to be a dedicated tax to a particular function. The minister just said those particular circumstances were less than transparent when applied to the B.C. Ferry Corporation. How is this different? Hon. G. Collins: I didn't say it was less than trans- parent.

I said I thought that having a service contract, which outlined what they were doing in regard to the funding they were receiving, was more accountable and transparent. Previously, they received a flow of revenue into the Ferry Corporation based on the fuel tax, and there was no sort of response of what they were accountable for in regard to providing services for that money. I just think this is a more open way. The Transportation Financing Authority is a crea- tion that's been there for some time.

The money will go into the Transportation Financing Authority, which has a mandate, and they will have to live within their mandate. They obviously report out annually, in an an- nual report, as well. Certainly, in the estimates process there is opportunity for members to ask the minister who deals with the Transportation Financing Author- ity questions with regard to the details of that. I think this is a very clear way. It's how the revenue went there before, and it will continue to go there. J. MacPhail: I do plan on raising these issues with the Minister of Transportation in estimates.

I just want to talk a bit about the effect of this gas tax increase. What is the increased cost to government in terms of this gas tax increase? Hon. G. Collins: I don't have a number in front of me. I know there has been some speculation with re- gard to that and transit, etc. Gas price volatility cer- tainly fluctuates up and down beyond a 3½-cent range, so it would be difficult, I think, for the purposes of try- ing to estimate the cost of this on the various ways that government accesses fuel and to try and quantify that.

To a certain extent, it could be lost in the general fluc- tuations and the forecasts for gas prices, so it's difficult to quantify. For example, I remember that the day before the announcement was made, gas was 82 cents. It fluctu- ated up and down between the day the announcement was made and the day it became effective on March 1, and it has fluctuated up and down since then. I've just sort of anecdotally been watching the price of gas, and I've seen it as high as 88 or 89 cents. I've seen it down into the high seventies since then, so it has been fluctu- ating up and down.

Obviously, there's a 3½-cent new tax that's in there somewhere as well, but it has not been a steady increase in the price of gas. It's been up, and it's been down both before and since the tax was levied. I do know — and the member raised it in question period — the impact of this tax on transit costs, for example. Certainly, there is that impact, but there is also just the price of fluctuations of gas.

We're in this odd situation right now where as a result of some of the challenges in Venezuela and the disruptions in their production as one of the large OPEC producers and, as well, the anxiety over what may or may not happen in Iraq possibly in the next weeks, the price of gas has gone up substantially. There are lots of things at play, and it would be difficult to try and take a snapshot of a week or even a couple of months and say that's the measure we should b e t a k i n g a n d t h a t w e s h o u l d r u n s o m e l o n g - t e r m numbers based on that.

I anticipate that if the problems in Iraq resolve themselves, probably — one way or the other — there could be increases, but there could also be decreases in the price of gas. Certainly, the last time there was a conflict in the Gulf, the price of oil went up dramatically, then de- clined quite precipitously thereafter and levelled off for a long period of time. The economics are such that it's very difficult to forecast. If we could, we'd probably both make a lot more money than we do now. That 3½

5428 B RITISH COLUMBIA DEBATES T UESDAY, MARCH 11, 2003 cents is well within the normal price fluctuations of gasoline. To my knowledge, and I can check, I don't know that individual agencies or individual school districts have yet made a long-run forecast of what the impact of the 3½ cents might be. [1525] J. MacPhail: Actually, it has nothing to do with the price of gas. Whether gas goes up or down, everybody either benefits or is harmed by that. Price would be different without this gas tax increase. It's separate and apart.

Just the same way the government has been able to calculate that revenue of $211 million extra will flow each year from that gas tax increase into the coffers, surely they must be able to calculate how much of that $211 million is being paid by government. I'm not talking about agencies. I believe our vehicle fleets are governed by one agency, so budget has…. Well, not budget. That's not a good example because t h a t ' s c o n s u m e r p a y . T r u c k i n g c o m p a n i e s h a v e b e e n able to calculate how much extra this is going to cost; taxi companies have. I'm just asking the minister.

He could calculate how much revenue he gets. Surely he must know how much he has to pay of that revenue. Hon. G. Collins: It's also based on volume, and the price elasticity of gas would have to be taken into con- sideration as well. We don't know, for example, for sure how the market's going to respond to a 3½-cent-a- litre gas tax. Much like when you raise the tobacco tax, you can do a very straightforward, straight-line mathematical calculation — which is what I'm assum- ing many entities have done — which says: "We bought so many litres last year; we're going to buy so many litres this year.

Add 3½ cents to that per litre, and here's a number." I know that's probably how they've done it. As I mentioned, the price of gas goes up and down, and that's based on elasticity. It's based on how people respond to the market. It's based on international oil prices — all of those things like local supply, local competition. At least, that's the theory behind it. It's d i f f i c u l t t o d e t e r m i n e . I s t a n d t o b e c o r r e c t e d i f I ' m wrong, but we do a calculation that is based on what the overall sales are, what the revenue increase might be.

Probably in there is some adjustment for price reac- tion. Certainly, if I can use tobacco again as an example, we raise it this year by $2 a carton. You can't assume that you're going to sell exactly the same number of cartons of cigarettes and exactly the same amount of loose tobacco and do a straight-line calculation and come up with a number, because people's behaviour will respond to that. Maybe fewer people will use it. There may be other things; they may use less. All those things come into play. You do the best estimate. It's a forecast of what you think.

Certainly, our revenue fore- cast for the gas tax is just that. It's a forecast. It's $211 million this year. I can almost guarantee you that it won't be $211 million; it will be something above it or below it. If we get really lucky and hit it right on, that would be great, but that rarely happens. It's a forecast. How might the various entities in the broader pub- lic sector calculate their costs? I anticipate that most of them, probably including the trucking industry, have done a straight-line calculation based on the volume they purchased in the past.

With all other things being equal — that is, the price of gas would remain the same — do a 3½-cent increase to the volume that you bought last year and you get a number, but markets don't nec- essarily respond that way. J. MacPhail: I certainly hope the minister isn't ob- fuscating. It sounds like he is, because if he isn't, then it's only bad news for him. It means that the $211 mil- lion that he's relying on to build roads and bridges in this province may not be there. It's different. I agree with the minister about the comparison to cigarettes, only to the point that there's elasticity of demand.

This government has gone on to link other things to the collection of this tax. When you collect cigarette taxes, the government hasn't then said: "Oh, by the way, and then we're linking increased taxes to provision of cancer surgery." They haven't done that. In this particular case, they have. [1530] The only money being invested into roads and bridges in the interior and the coast comes out of this fund, so it better be accurate. If it isn't accurate, it means fewer roads and bridges will be built.

I can't accept the fact that the minister doesn't know an esti- mate of how much of this $211 million in extra taxes will be paid by the government. I'm talking out of the CRF. I'm not talking about out of anything else. I'm just talking about out of the fleet of vehicles that this gov- ernment uses on a day-to-day basis from ministries. One other thing. It ain't good news if the elasticity of demand because of a gas tax increase means people are going to use less fuel, because I expect that people in the transportation industry aren't going to get on a bus to ship their stuff.

I don't expect that tourism op- erators are relying on increased public transit so that people can come and visit their destinations. Let me carry on, then. Clearly, I'm not going to get an answer from the minister about how much of this is direct government expenditure. We did have the calcu- lation when MSP premiums were increased. Every- body else could figure it out exactly, and there's elastic- ity of demand there as well. I'm just taken aback by that work not being done. Well, let me ask the question, then, about elasticity of demand. Tourism.

It's a major part of the economy — 4 percent of GDP and 7 percent of employment. What studies has the minister done in terms of the im- pact of this gas tax increase on tourism? Hon. G. Collins: We made a decision that the infra- structure deficit that was there needed to be dealt with. Government made a decision to invest fairly heavily in infrastructure in the years ahead. It made a decision that we were not going to leave a debt behind as a re-

TUESDAY, MARCH 11, 2003 B RITISH COLUMBIA DEBATES 5429 sult. So, the value of the 3.5-cent-per-litre gas tax reve- nue is going to be plowed, penny for penny, into the building of that infrastructure in an effort to make sure we don't have a debt. There are many benefits that could accrue to a whole bunch of people as a result of this. The trucking industry had a study that said the delays at the border alone cost them $60 million a year. We are now invest- ing in border infrastructure as part of the agreement with the federal government. That's where part of these revenues will go.

We hope that will save the trucking industry $60 million a year once they're complete. The tourism industry as well. I would guess that tourism — buses that move around in the city of Van- couver, for example, if you want to deal with density issues…. Once these infrastructure improvements are in place, they may find that their fuel consumption actually goes down because they'll have greater flexi- bility and greater ability to move. That may be. These are long-run investments. You could take an example of some of the other ones, the safety improvements.

Kicking Horse Canyon is an example of a fairly major infrastructure change that will improve safety, and that improved safety cer- tainly is a positive message for the tourism industry as well. There was a horrific accident involving a tourist bus not too long ago in that part of the province. I know at that time the tourism industry said that's a highway that needs to be improved. That is something that has to happen for them in order to continue that industry in a safe way. There are all sorts of benefits that are clear and an- ecdotal but that are difficult to quantify.

I think that the overall benefits not just to tourism but to the mining sector, to the forestry sector, to just about anybody who is using the highways and roads of the province — on a safety side as well as potentially on a fuel consumption side, as well as on wear and tear on their vehicles — are immense. I think there are lots of benefits that are out there. They're anecdotal. They'd be very difficult to quantify, but they're there. J. MacPhail: Two out of the three examples the minister gave there were infrastructure investments in the lower mainland.

It's my understanding that this tax is being used for areas outside of the lower mainland. Is this money being used to do border crossings in the lower mainland? [1535] Hon. G. Collins: There is a whole series of infra- structure projects that are on the list, which we're try- ing to achieve. There are rural and remote roads. There's maintenance. There are upgrades. There's look- ing at bridge infrastructure, as well, outside the lower mainland.

I — and, I think, the minister — said at the time that over the next three years, we are going to be collecting approximately $650 million from this flow of revenue, and we are going to spend every dollar on infrastructure. We're going to try and lever additional investments from private sector partners as well as from the federal government, in order to ensure that w e c a n m a x i m i z e e a c h d o l l a r w e s p e n d . T h r o u g h t h e raising of the 3.5 cents, $650 million are going to be invested. There is a hope for an additional $1.7 billion in contributions from other partners.

Those will be dispensed across the province, based on the transporta- tion infrastructure needs that exist now. J. MacPhail: For the record, the previous provincial gas tax of 11 cents per litre all went to transportation infrastructure as well, so that's not a change. Through- out the entire 1990s, British Columbia was the only province, I think, to spend 100 percent of its fuel tax revenue on transportation infrastructure. None of it went into general revenue. While I acknowledge the fact that that trend will continue, it's not a new trend. Well then, I'm curious.

Yesterday I saw the list put forward by the Premier for transportation infrastruc- ture at the provincial congress. Border crossings were not on the list, and no lower mainland projects were on the list. Is the minister now saying that some of this money may go into the lower mainland? I'd be happy to hear that. Hon. G. Collins: It hasn't been determined that all of it, or none of it, will go into the lower mainland.

The agenda is to take these dollars and invest them on the priorities of the province, to try and leverage additional sources of funding from the federal government and from private sector partners, and to maximize the value for the dollars we get. If the member wants a fuller briefing on the plan, then obviously the place to do that is in the estimates of the Minister of Transporta- tion — or, I know, the minister would be more than happy to provide an individual briefing for the mem- ber.

As well, there is a fair bit of information on the government website as a result of the rollout of the transportation infrastructure plan, which may answer a lot of the questions that the member might have. J. MacPhail: I will be following up with the Minis- ter of Transportation in her estimates. I'm going by the commitment the government made that this money would be spent in their rural strategy and interior strategy. We were also told that tolls may be an option in the lower mainland. Just as recently as yesterday, I saw the Premier's list of what infrastructure was going to be built.

He related it to exactly the same figures that the Minister of Finance has just suggested. I just want to read two things into the record. In December 11, 2001, the Minister of Competition, Sci- ence and Enterprise said: "We are a government that stands for reducing taxation, not increasing taxation. Increasing taxation does not fit in with our new era of hope and prosperity for British Columbians." That was then; this is now. From the MLA for Cariboo South, February 18, 2003, responding to this gas tax increase: "I don't know.

I would hope that we don't see too many more increases in anything." Has the minister received any feedback from businesses — small, medium or large — on the gas tax increase?

5430 B RITISH COLUMBIA DEBATES T UESDAY, MARCH 11, 2003 [1540] Hon. G. Collins: I wouldn't say I've received a co- pious amount, but then they probably wouldn't send it directly to me. It would more likely go to the Premier or the Minister of Transportation. I have seen a number of letters from individual businesses, as well as associa- tions, saying the investment on infrastructure is the right thing to do. They're glad we're not leaving a debt as we build it, and they're glad we're paying for it as we build it. I think it's fair to say that nobody likes to see any tax go up — anytime, ever.

I would put myself in that category as well, although I think this one is something the majority of British Columbians under- stand. They certainly are aware that we do have a defi- cit in infrastructure. We've underfunded it over a long period of time — not underfunded, but over a long period of time there have not been the investments in it to either keep it current or expand it in such a way that continues to be a source of economic strength for the province and safer as well. So we continue to do that. We did get some positive responses from industry.

Obviously, as the member mentioned, the trucking industry was upset about the cost, but the trucking industry is also going to be one of the chief beneficiar- ies of the improvements as well. So, as I said, I think people understand the benefit. I understand and accept that people don't ever like to see any tax raised at any time. But we decided that if we're going to make these improvements, we were going to pay for them. [1545]

Section 24 approved on the following division: YEAS — 65 Falcon Coell Hogg Halsey-Brandt Hawkins Whittred Cheema Hansen J. Reid Bruce Santori van Dongen Roddick Wilson Lee Hagen Murray Plant Campbell Collins Clark Bond de Jong Nebbeling Stephens Abbott Neufeld Coleman Penner Jarvis Anderson Orr Nuraney Brenzinger Belsey Bell Long Chutter Mayencourt Trumper Johnston Bennett R. Stewart Christensen Krueger McMahon Bray Les Locke Nijjar Bhullar Wong Bloy Suffredine MacKay Cobb K. Stewart Visser Lekstrom Brice Sultan Hamilton Sahota Hawes Manhas NAYS — 2 Nettleton MacPhail Sections 25 and 26 approved. On

section 27. [1550] J. MacPhail:

Section 27 provides for tax exemptions for fuel in prescribed circumstances. Is this an addition to allow for the prescription of exemptions? Hon. G. Collins: Yes, it is. It's designed to allow for an exemption for marine gas used in turbine engines. The member will recall, in July of 2001, that when the government brought in its economic and fiscal update, it provided a bunker fuel exemption or removed the tax on bunker fuel. That was in response to the shipping indus- try and, as well, the cruise ship industry in particular.

There is a new generation of ships being developed in the shipping industry, which use turbine engines and actually are far more environmentally friendly — is my understanding. They felt that an exemption that was given to bunker fuel should be provided to them, as well, for competitiveness reasons, and we agreed. Sections 27 to 38 inclusive approved. On

section 39. J. MacPhail: This

section repeals the special ac- count known as the working capital account. For the House, could the minister explain what it was and what replaces it? Hon. G. Collins: This account has been inactive for a number of years. Ministries now receive funding di- rectly for capital asset acquisitions themselves. It's no longer needed; therefore, it's being repealed. J. MacPhail: So it's just that the work that the Pur- chasing Commission did around capital is no longer there. But other purchases continue? Hon. G. Collins: That's correct.

Section 39 approved. On

section 40. J. MacPhail: It's hard to tell from either the ex- planatory notes or the act, but it looks like this particu- lar section, which amends the social service tax, ex- cludes from taxes…. Oh no, that's not the one. That's 41. I'm fine with 41, the bird seed.

Section 40 now in- cludes items for taxation. Am I correct? Maybe the min- ister could explain the clause. Hon. G. Collins: There are exemptions in place right now in the mining industry for certain products

TUESDAY, MARCH 11, 2003 B RITISH COLUMBIA DEBATES 5431 that the industry uses. The aggregate industry, which is gravel mining, gravel quarrying, has asked that they be provided with similar exemptions in the spirit of fair- ness, and for the same reasons we've applied it to the mineral industry. We agreed, and therefore we're pro- viding that exemption here as well. J. MacPhail: S o t o b e c l e a r … . I t ' s a n i n t e r e s t i n g drafting. Under clause 40, the third line, it's got bolded there, "…and substituting…." Everything after that is now exempt from the social service tax payment? Hon. G.

Collins: The act used to say it didn't in- clude these things. The act, as it was previously writ- ten, had a list and a comma and said, "but does not include…" and a list of things. What we've done is take out the wording that says, "but does not include," so this latter list, which was excluded, now gets attached to the first part of the sentence, so they're all included in the exemption now. I hope that explains it. [1555] J. MacPhail: Y e s , I t h i n k i t d o e s .

J u s t t o b e c l e a r , building and construction stone, marble, shale, clay, sand and gravel used to pay social service tax, and now they don't. What was the revenue stream on social ser- vice tax from these items in '02-03 approximately? Hon. G. Collins: It would not be a great deal. We think it's probably a hundred or hundreds of thou- sands of dollars. It's not in the millions at all. Sections 40 to 42 inclusive approved. On

section 43. J. MacPhail:

Section 43 adds a power to make regu- lations prescribing the circumstances in which the commissioner must impose a penalty under a particu- lar section. This is under the Social Service Tax Act. What's the reason behind this addition? Hon. G. Collins: It's really a redirection of where the liability lies. The way it worked in the past is a contrac- tor, on behalf of a customer, may go and make a declara- tion that they're exempt. If they fail to do that or if they actually weren't exempt, then the penalty would be as- sessed to the contractor. We feel that's inappropriate.

Penalties should be assessed to the purchaser, because it's their declaration that needs to be made. Rather than having the penalty applied to the contractor, the penalty must be applied to the original purchaser. [K. Stewart in the chair.] Sections 43 to 51 inclusive approved. On

section 52. J. MacPhail: This is a transitional provision for re- vised ministerial accountability rules in relation to an- ticipated federal health care spending. The Minister of Finance and I discussed this in estimates. It deals only with transitional situations for ministerial accountabil- ity for Minister of Health Services and Minister of Health Planning. What the

section basically does is say that once the budget comes down, the money from the federal government, a new service plan or new esti- mate will be introduced, and it will be on that basis that the Minister of Health Services and Minister of Health Planning will be held accountable under the Budget Transparency and Accountability Act. I'm curi- ous to know what the status is of those discussions with the federal health care moneys and what happens if there's no agreement, in terms of this fiscal year. Hon. G.

Collins: Well, there is an agreement be- tween the first ministers that there will be a certain amount that flows. The questions that we are dealing with now are: how does the money flow, and when does it flow? We're working on the details right now, and as I mentioned, the federal government would like to be able to flow it all in this fiscal year for their pur- poses. Interjection. Hon. G. Collins: Sorry, no — well, probably 2003- 04. They want to put it out the door as quickly as pos- sible. They're moving from a cash to an accrual basis next year, so they want to get it out as soon as they can.

We've made it very clear to them that we have some very clear rules in this province around how that works. We're moving to GAAP in a legislated way, and therefore that model won't work for British Columbia. We advised them of that. I know I advised the Minister of Finance of that repeatedly. I know the Ministers of Health did. I know the Premier did, as well, and re- ceived assurances from the Prime Minister as well as the Minister of Finance and the Deputy Minister of Finance that they would work with us to try and de- velop a way that would work for the province.

Those discussions are ongoing. [1600] I think we've identified what the various options might be. The reality is that at some point, the federal government will have to determine how it plans to pro- ceed. We have been involved in lockstep with them, try- ing to make sure they understand our accounting needs and how it would have to work in British Columbia. I've spoken to the Minister of Finance. I've passed other messages. There's been correspondence to the deputy minister and to the Premier. There have been a lot of people involved in this.

At this point, as I said, I think we've identified a couple of options. We'll have to wait and see what the federal government's response is to that. I believe we should know that fairly soon, within the next couple of weeks or so. J. MacPhail: There is no issue about more money flowing in the B.C. provincial fiscal '03-04. Money will flow?

5432 B RITISH COLUMBIA DEBATES T UESDAY, MARCH 11, 2003 Hon. G. Collins: That's correct. We assume it will flow. The challenge we have is that it might all flow in '03-04, and then you see a big spike in money that we would find very difficult to spend wisely. I doubt the Health ministry couldn't spend it. I'm sure they could find a way to spend it, but I doubt it would be spent wisely if $1.3 billion were to come in one year. What we're trying to do is say that that money should be done over three years as the deal and the commitment were, and really what we're sorting out now is just the accounting.

There will be additional funds in '03-04. We just don't know the amount yet. J. MacPhail: Who's conducting those negotiations? Hon. G. Collins: As I mentioned, the Premier and the Prime Minister have spoken about it a couple of times. They certainly spoke at the time when the minis- ters were meeting. Officials are involved from the Pre- mier's office, from the Ministry of Finance. As well, I'm involved when necessary. It's a top priority for the government obviously. It is a large amount of money.

It's very crucial to the health planning and to the health delivery in the province that it flow in a way that makes sense and that is useful to improve health care outcomes. That, as well, is the goal of the federal gov- ernment: to improve health care outcomes. What we're really discussing is the accounting treatment of it. As the member is probably aware, sometimes those can get pretty technical and frustrating, but we continue to pursue it at the highest levels. Sections 52 to 58 inclusive approved. On

section 59. Hon. G. Collins: I move the amendment to

section 59 standing in my name on the order paper. [SECTION 59, by deleting the proposed subsection (1) and substituting the following:

(1) In this section: "government" includes an improvement district, a municipality or a regional district under the Local Government Act or the City of Vancouver under the Vancouver Charter; "tax Acts" means the (

a) Corporation Capital Tax Act, (

b) Hotel Room Tax Act, (

c) Insurance Premium Tax Act, (

d) Local Government Act, (

e) Logging Tax Act, (

f) Motor Fuel Tax Act, (

g) Social Service Tax Act, (

h) Taxation (Rural Area) Act, (

i) Tobacco Tax Act, and (

j) Vancouver Charter.] Amendment approved.

Section 59 as amended approved.

Section 60 approved. Title approved. Hon. G. Collins: I move the committee rise and report the bill complete with amendment. Motion approved. The committee rose at 4:03 p.m. The House resumed; Mr. Speaker in the chair. Reporting of Bills Bill 6, Budget Measures Implementation Act, 2003, reported complete with amendment. Third Reading of Bills Mr. Speaker: When shall the bill be considered as read? Hon. G. Collins: By leave, now, Mr. Speaker. Leave granted. Bill 6, Budget Measures Implementation Act, 2003, read a third time and passed. Hon. G. Collins: I call committee stage debate of Bill 7.

Committee of the Whole House INCOME TAX AMENDMENT ACT, 2003 The House in Committee of the Whole (Section

B) on Bill 7; K. Stewart in the chair. The committee met at 4:05 p.m.

Section 1,

section 25.1, and

section 2,

section 42 ap- proved. On

section 3,

section 79. J. MacPhail: At second reading I noted that my discussion was not necessarily around using the tax structure to encourage business, but a discussion around what else indeed needs to be done to assist these industries, so my questions will flow from that.

Section 3 deals with the tax credits for animation and digital effects. Of course, this is a very competitive global market. We're doing well in British Columbia in this area, though. My question here is the status of the industry, in terms of what the industry suggests this tax credit will do for them. Hon. G. Collins: Both Quebec and Ontario have similar tax provisions. They're not identical, but they're similar. We made a commitment as government that we would maintain the competitiveness of our taxation

TUESDAY, MARCH 11, 2003 B RITISH COLUMBIA DEBATES 5433 system in the province. That's what this is intended to do. It's to put those industries on a level playing field so they can compete. It's a new area; it's a growing area. We have some great expertise and some talent he re i n t he p ro v i nc e . W e wan t t o k e e p t hat and g ro w that business. Certainly, as the film industry gets more and more technically advanced….

A larger and larger component of just about every movie has some anima- tion or visual effect, so we want to make sure that we don't find ourselves in a position where we're not competitive with other jurisdictions based on what they're doing. J. MacPhail: Is there anything about this tax credit that applies separately and apart from animation and digital effects? Hon. G. Collins:

Section 3(

a) is really the digital animation and visual effects.

Section 3(

b) applies to all the tax credits, and it clarifies that all preceding years' labour expenditures are included in the calculation. It's a cumulative expense, as to how they determine this tax, so they want to make sure all the previous years are included in that. It's really just a technical clarifica- tion of the legislation that was there before. J. MacPhail: But my understanding is that this tax credit is expanding to include the animation and digital effects industry. Hon. G. Collins: This

section actually takes a pre- vious tax credit and adds digital animation and visual effects to it, yes. [1610] J. MacPhail: I'm curious to know, and the reason I'm asking that is…. Mr. Chair, I'm voting in favour of all of these sections, but because sections 3 through 10 deal with the animation and digital effects industry, I'm curious to know what discussion there has been with the industry about how the regional production services tax credit will apply. What is the regionaliza- tion of this industry? Hon. G. Collins: Previously the tax credit applied only to domestic production.

It now applies to interna- tional production as well. J. MacPhail: I'm just trying to get a sense of where this regional tax credit would apply. I know there have probably been discussions with the industry, just in my own experience in this area. The industry lobbies for this and says how it will work. Where will there be a regional application of this tax credit? Hon. G. Collins: The regional tax credit is generally outside the GVRD, so it's to try and add a further in- centive to make regional film production more com- petitive as well. A lot of it happens, as the member will know, in the lower mainland.

We believe there are plenty of opportunities to extend that industry outside the lower mainland into the rest of the province, and the regional tax credit is designed to do that. J. MacPhail: The minister and I have had discus- sions about the value of the dollar as it applies to our various industries, and I was very interested in the perspective of both Dr. Lipsey and Dr. David Emerson yesterday at the provincial congress on the value of the dollar and how it relates. Both of them seemed to think that a higher dollar in the long run was good. Dr.

Lip- sey certainly suggested there would be more pain in the short term than did David Emerson. I just note for the minister that I'm not convinced that the short-term pain won't be a killing pain. If a short-term pain kills off something, it doesn't matter that it's short term. It's deadly. I fully understand the argument that Dr. Lipsey was making about productiv- ity and the fact that we have to be highly productive and that the low Canadian dollar masks that. I just make my point here that regional tax credits mean nothing if a high dollar wipes out the industry.

I share only great hope that industries expand, and I share great worry about an interest rate policy that allows for a higher Canadian dollar, combined with other aspects, that may be a short-term killer. Hon. G. Collins: The member and I have had that discussion in the past, and I was present for the discus- sion and the debate as it took place yesterday at the provincial congress and for the comments by the mem- ber opposite, by Dr. Lipsey as well as by Dr. David Emerson with regard to interest rate exposure and the impact on our economy.

It's a fact, and those industries that are extremely competitive are even more subject to the whims of interest rate fluctuation. It's something I know they take into consideration. I also know the film industry can move very quickly in choosing locations, and certainly we have to be mindful of that. It is something that I think all in- dustry, as well as all workers in an industry, should keep in mind. It's always in the best interests of every- body to be as flexible and as productive as they can be.

It certainly puts you in a better position when the weathers of change or, in this case, interest rate fluctua- tions start to bite and have an impact. One should never assume the Canadian dollar is going to stay in the mid-sixties. It could change. You should always be prepared to be as efficient and productive as you can be to ensure that those winds of change don't set you off course. I am mindful of the comments the member made.

I am also mindful of and I have conveyed, and will in the future continue to convey, the position of the prov- ince with regard to interest rates to the governor of the B a n k o f C a n a d a w h e n w e m e e t w i t h h i m o r h i s s t a f f periodically throughout the year — that they must be mindful of British Columbia's economy, not just On- tario's economy, in determining what the impact of inflation and the impact of interest rates are. Certainly, this industry is an example of one that is very much subject to those kinds of fluctuations.

5434 B RITISH COLUMBIA DEBATES T UESDAY, MARCH 11, 2003 Sections 3 to 12 inclusive approved. [1615] Title approved. Hon. G. Collins: I move the committee rise and report the bill complete without amendment. Motion approved. The committee rose at 4:17 p.m. The House resumed; Mr. Speaker in the chair. Report and Third Reading of Bills Bill 7, Income Tax Amendment Act, 2003, reported complete without amendment, read a third time and passed. Hon. G. Collins: I call committee stage debate of Bill 9. Committee of the Whole House AUDITOR GENERAL ACT The House in Committee of the Whole (Section

B) on Bill 9; K. Stewart in the chair. The committee met at 4:17 p.m. Sections 1 to 45 inclusive approved. Title approved. Hon. G. Collins: I move the committee rise and report the bill complete without amendment. Motion approved. The committee rose at 4:18 p.m. The House resumed; Mr. Speaker in the chair. Report and Third Reading of Bills Bill 9, Auditor General Act, reported complete without amendment, read a third time and passed. Hon. G. Collins: I call committee stage debate of Bill 11. Committee of the Whole House MISCELLANEOUS STATUTES AMENDMENT ACT, 2003 The House in Committee of the Whole (Section

B) on Bill 11; K. Stewart in the chair. The committee met at 4:19 p.m. Hon. G. Collins: We're awaiting the arrival of the member for Vancouver-Hastings, so perhaps the com- mittee can just recess for a few minutes. The committee recessed from 4:20 p.m. to 4:25 p.m. [K. Stewart in the chair.]

Section 1 approved. Sections 2 to 5 inclusive approved. On

section 6. J. MacPhail: This amendment to the Budget Trans- parency and Accountability Act provides for the appli- cation of generally accepted accounting principles in advance of the requirement established by

section 23.1 of the act. As I recall,

section 23.1 of the act says that the GAAP principles have to be in place and used by 2004-05. Hon. G. Plant: My understanding is that the com- mencement date for

section 23.1 of the BTAA is April 1, 2004. The effect of this amendment and the next

section is to speak to the application of that requirement in respect of the timing of different documents. I'm in the member's hands unless she'd like a slightly larger ex- planation. J. MacPhail: I'm just curious to know. This amendment apparently provides for it to be applied earlier than '04-05. My reason for asking the question — it's just for information — is that the budget for '03- 04 is already done. How do you apply principles ear- lier than '04-05? Hon. G. Plant: Let me read the note that has been prepared for the assistance of ministers with respect to this

section and

section 7 to see if it answers the mem- ber's

Document details

Collection	British Columbia — Debates (Hansard)
Citation	H0311pm 11
Type	hansard
Volume / chapter	H0311pm 11
Language	en
Format	pdf
Source	PROVINCIAL
Identifier	267edeff5d8c18418a78a50f54a0160d21dbe508

Source file is stored in the law ingest library (pdf).