1976 Legislative Session: 1st Session, 31st Parliament

HANSARD

The following electronic version is for informational purposes only.

The printed version remains the official version.

Official Report of

DEBATES OF THE LEGISLATIVE ASSEMBLY

(Hansard)

WEDNESDAY, JUNE 16, 1976

Afternoon Sitting

[ Page

2675 ]

CONTENTS

Routine proceedings

Miscellaneous Statements Amendment Act, 1976 (Bill 78) Hon. Mr. Gardom.

Introduction and first reading — 2675

Oral questions

Resistance to ferry fare increases. Mr. Lea — 2675

Fraud charges against BCR. Hon. Mr. Phillips answers — 2676

Designation of Jericho Hill School site. Mr. Gibson — 2677

Gasoline price increase at self-service stations. Mr. Macdonald —

Mine closings. Mr. Lauk — 2678

Committee of Supply: Department of Mines and Petroleum Resources estimates.

On vote 130. Hon. Mr. Waterland — 2680

Mr. Skelly — 2678 Mr. Chabot — 2680

Hon. Mr. Waterland — 2679 Mr. Lauk — 2681

Mr. Lea — 2679 Mr. Bawtree — 2683

Introduction

Mr. Joe Clark presented to House. Hon. Mr. Bennett — 2683

Mr. Wallace — 2684

Mr. Barrett — 2684

Mr. Gibson — 2684

Routine proceedings

Committee of Supply: Department of Mines and Petroleum Resources estimates.

On vote 130. Mr. Barrett — 2706

Mr. Bawtree — 2684 Mr. Chabot — 2706

Mr. Skelly — 2685 Mr. Lauk — 2706

Mr. Barber — 2688 Mr. Barrett — 2707

Mr. Rogers — 2690 Hon. Mr. Waterland — 2707

Mr. Gibson — 2690 Mr. Barrett — 2707

Mrs. Wallace — 2692 Point of order.

Mr. Skelly — 2693 Mr. Bawlf — 2708

Hon. Mr. Waterland — 2693 Mr. Gibson — 2709

Mr. Lauk — 2697 Mr. Chairman — 2709

Point of order. Mr. Bawlf — 2709

Mr. King — 2700 On vote 130.

Mr. Bawlf — 2700 Mr. Lauk — 2709

Mr. Chairman — 2700 Hon. Mr. Waterland — 2709

Mr. Haddad — 2701 Mr. Lauk — 2709

Mr. Hewitt — 2701 Mr. Gibson — 2710

On vote 130. Mr. King — 2711

Mr. Lauk — 2701 Mr. Lauk — 2711

Hon. Mr. Waterland 2703 Motion to reduce minister's salary.

Mr. Lauk — 2704 Mr. Lauk — 2712

Hon. Mr. Waterland — 2705 Mr. Barrett — 2712

Mr. Barrett — 2705 Hon. Mr. Waterland — 2712

Mr. Lauk — 2705 Mr. Barrett — 2713

Statement

Details of First Minister's Conference. Hon. Mr. Bennett — 2713

Mr. Barrett — 2716

Mr. Gibson — 2717

Mr. Wallace — 2718

Appendix — 2718

The House sat at 2 p.m.

Prayers.

HON. W.R. BENNETT (Premier): Mr. Speaker, I'd like to welcome

back to the press gallery a member of the gallery who is the winner of

the Louis St. Laurent fellowship in journalism, and is back after a

year's absence at Queens University. I'd like the House to welcome back

Candide Temple.

MR. G. HADDAD (Kootenay): Mr. Speaker, from the great

constituency of Kootenay, up in the gallery I have Mr. Mel Wooley,

manager of the Kimberley Chamber of Commerce. Would you please welcome

him here today?

MR. G. MUSSALLEM (Dewdney): Mr. Speaker, I wish to address

you, sir, and say that seated on the floor of the House today is a

former member of this House who sat with us in this northwest corner

and anchor of the House some years ago, and who by purest accident was

defeated in the provincial election in 1972, who subsequently resisted

with all his might but was forced to take the nomination for Fraser

Valley West and was elected to the House of Parliament. He says what he

misses most is the decorum we had here, the thrust and brilliance of

debate, but nevertheless he is in Ottawa. I ask you to welcome Mr. Bob

Wenman, MP.

MR. G.H. KERSTER (Coquitlam): Mr. Speaker, in the House

today, at approximately 3 o'clock this afternoon, there'll be a group

of students from Mary Hill Secondary School in Port Coquitlam. They'll

be accompanied by their teacher, Mrs. C. Cuthbertson. Would the House

join me in advance of their arrival in making them welcome?

HON. H.A. CURTIS (Minister of Municipal Affairs): Mr.

Speaker, three constituents of mine are in the members' gallery today.

One is the wife of the distinguished and very highly regarded Chief of Hansard , Mr. Chazottes — I refer to Mrs. Daphne Chazottes — and two friends of the Chazottes', Mr. and Mrs. Christopherson.

I should point out for Hansard the spelling of Chazottes is C-h-a-z-o-t-t-e-s. (Laughter.)

MR. L.B. KAHL (Esquimalt): Mr. Speaker, seated in the gallery

this afternoon is my most capable constituency secretary, Mr. Frank

Vinson. I would ask the House to make him welcome, please.

Introduction of bills.

MISCELLANEOUS STATUTES

AMENDMENT ACT, 1976

Hon. Mr. Williams, on behalf of Hon. Mr. Gardom, presents a message from His

Honour the Lieutenant-Governor: a bill intituled Miscellaneous Statutes Amendment

Act, 1976.

Bill 78 introduced, read a last time and ordered to be placed on

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

after today.

HON. MR. BENNETT: Mr. Speaker, I'd just like to advise the

House that I will be asking leave to make a statement on the recent

federal-provincial conference in approximately half an hour. Because of

some of the technical nature of my remarks it's still being typed, and

I hope the House will allow me that privilege then.

Oral questions.

RESISTANCE TO

FERRY FARE INCREASES

MR. G.R. LEA (Prince Rupert): Mr. Speaker, a question to the

hon. Minister of Transport. Last Tuesday, at the Canadian

Transportation and Research Forum, Dr. William Hughes, research

director of the B.C. Department of Transport, said that public

resistance to the recent fare increases by B.C. Ferries is much greater

than was expected. He said the people are staying away from the ferries

in droves. He said he is studying the possible economic advantages of

providing free service for foot passengers on B.C. ferries. Last week

the minister repeatedly assured the House that publicity regarding a

possible strike and not the government's massive ferry rate increases

was responsible for the sharp decrease in ferry traffic.

Because of that answer I would like to go on to ask the minister so

people might understand some facts instead of excuses.... Would the

minister tell this House now how many vehicles and passengers were

carried on the major routes during the first half of this month and

also the comparative figures for June 1 to 15 last year, and would the

minister also inform us of the corresponding revenues to the ferries in

those two 15-day periods?

HON. J. DAVIS (Minister of Transport and Communications): Mr. Speaker, I'd be glad to take that question involving details as notice.

MR. LEA: Mr. Speaker, I appreciate the minister taking the

part for the details on notice, but I would like him to comment, if he

would, on the apparent discrepancy between the minister's statement last

[ Page 2676 ]

week and what one of the directors of his research branch said this week.

MR. SPEAKER: I think you heard the minister take the question as notice.

MR. LEA: Mr. Speaker, I think the minister was prepared to

answer, and this should be a question-and-answer period, not a Speaker

period.

MR. SPEAKER: Order, please!

FRAUD CHARGES AGAINST BCR

HON. D.M. PHILLIPS (Minister of Economic Development): Mr.

Speaker, I am pleased to respond on behalf of the Attorney-General

(Hon. Mr. Gardom) to the question asked yesterday by the Leader of the

Opposition (Mr. Barrett) with respect to the court proceedings between

M.E.L. Paving and the British Columbia Railway.

To begin with I should point out to the Leader of the Opposition

that I am advised the matter is not one involving the Department of the

Attorney-General. As I would have thought the hon. member knows, the

action is against a Crown corporation, the B.C. Railway, which in its

own right has engaged its own counsel, Mr. Harvey Grey, and

Charles Maclean.

Nevertheless, in answer to the question of the Leader of the

Opposition, I am advised that the case was adjourned on action

initiated by the plaintiff, M, E.L. Paving. When counsel for M.E.L.,

Allan McEachern, amended his statement of claim by making further

claims against the railway, solicitors for the British Columbia Railway

were ready to proceed on May 15 as was previously scheduled. The

amendments, I understand, have resulted in the need for railway

engineers to commence further studies which are now underway so a

proper defence of the new claim can be prepared. As a result, both

parties asked the judge for an adjournment to a later date in October.

Mr. Speaker, as this matter is before the courts and therefore in

the hands of the solicitors, it would be improper for me or anyone in

this House to comment further as to those proceedings, save to say that

due process is being followed and that the case shall be heard in the

fall.

MR. D. BARRETT (Leader of the Opposition): Mr. Speaker, may I

then interpret the minister's answer by way of a statement that it is

not the intention of the Crown agency, nor have they received any

instruction, to settle out of court?

HON. MR. PHILLIPS: Not to my knowledge.

MR. BARRETT: Would the minister then answer he question as to

why Clarkson Gordon was instructed to set aside $12.5 million in their

report on instruction from the government for settlement for contingent

liabilities of the railroad, unknown other than perhaps for that court

case?

HON. MR. PHILLIPS: Mr. Speaker, maybe the Leader of the

Opposition is not aware that the railway is being run now by the

management of the railway; and if this was the case, this was a

decision of the management of the railway and not a political decision.

MR. BARRETT: I want to thank the minister. A further

supplementary: I want to ask that the advice of the 1976 auditors of

the B.C. Railway...legal counsel has been advised that the railway

should be successful in defending itself in the fraud and conspiracy

case launched by M.E.L. Can the minister assure this House, since this

is the report you tabled, and I quote from that report, that the

railway, even though having set aside the money, will not settle the

case outside of court?

HON. MR. PHILLIPS: Again, as I stated, Clarkson Gordon is

working for the management of the railway. Certainly if they've taken

any instructions, they have taken them from the management of the

railway. I say again that the railway is now being run by the

management of the railway and not being run out of Victoria, as was the

case for the last three and a half years. Maybe it's difficult, Mr.

Speaker, for the ex-president of the railway to understand this.

MR. BARRETT: The minister is incorrect in saying that Clarkson Gordon prepared the railway's annual report.

MR. SPEAKER: What is your question, Hon. Member?

MR. BARRETT: I am referring to B.C. Rail's annual report and

the conflicting statements between Clarkson Gordon's statement and B.C.

Rail's statement.

MR. SPEAKER: What is your question?

MR. BARRETT: I ask the minister: who is the auditing firm for B.C. Rail?

HON. MR. PHILLIPS: Mr. Speaker, the auditors for the railway are a matter of public record.

AN HON. MEMBER: Oh, oh!

MR. BARRETT: On a supplementary question,

[ Page 2677 ]

the minister stated today that Clarkson Gordon is the auditor for B.C. Rail. I want to know when that appointment was made.

HON. MR. PHILLIPS: Maybe the Leader of the Opposition misunderstood me. I said the auditors of the railway are a matter of public record.

MR. BARRETT: I ask the minister then to correct the statement. Is the auditing firm for B.C. Rail now Clarkson Gordon?

HON. MR. PHILLIPS: As I stated before, Mr. Speaker, the matter of the auditors for the B.C. Rail is a matter of public record.

MR. KING: You don't know!

AN HON. MEMBER: He doesn't even know who the auditors are!

DESIGNATION OF JERICHO

HILL SCHOOL SITE

MR. G.F. GIBSON (North Vancouver-Capilano): Mr. Speaker, I

have a question for the Minister of Education. I would like to ask the

minister about order-in-council 1669, passed on May 27 of this year,

which had the effect of changing the designation of the property on

which Jericho Hill School is situated. It was changed from being a

school specifically for the deaf and blind to merely a general

designation of the site for educational facilities. I would ask the

minister what the reason is for this change. What will the other

facilities consist of? Who will operate them?

HON. P.L. McGEER (Minister of Education): Mr. Speaker, the

change in designation for the Jericho Hill School property is related

to the fact that there are currently on the Jericho Hill School campus

five surplus buildings which were built out of public funds and which

are not currently being used. It's the desire of the government and the

Department of Education that the facilities at Jericho be put to the

best possible use for the people of British Columbia within the

educational sphere. It will be a matter of government policy as to how

best to use these surplus facilities as time develops. There will be

announcements made in the future.

MR. GIBSON: On a supplementary question, an

article in The Vancouver Sun

on June 8 with respect to Jericho Hill School mentions that Mr. John

Anderson has been given the job of determining which children presently

at the school could benefit from being put into community classes. It

quotes Mr. Anderson as saying: "We're working now to see that the kids

get the best service possible within the minister's policy." Will the

minister inform the House the terms of reference given to Mr.

Anderson's committee?

HON. MR. McGEER: Mr. Speaker, I'll have to take that question

as notice. I have given the gentleman no specific terms of reference

but I would be happy to provide that to the House.

MR. GIBSON: Just one final supplementary: was Mr. Anderson

given a maximum number of beds or positions that would remain open for

deaf children on the Jericho Hill campus?

HON. MR. McGEER: No, Mr. Speaker. It will be there to satisfy

the needs of communicatively impaired British Columbians. It's been

that way in the past and it will continue to be that way in the future.

GASOLINE PRICE INCREASES

AT SELF-SERVICE STATIONS

MR. A.B. MACDONALD (Vancouver East): Mr. Speaker, I would

like to ask the Premier a question in view of the fact that the

self-serve stations in the Victoria area have increased the price of

gasoline to consumers by 2 cents a gallon. Of course, they are

company-operated and that would be an evasion of the refinery gate

freeze that the Premier talks about. Will he therefore take immediate

action to see that the Energy Commission orders that the 2-cent

increase be rolled back?

HON. MR. BENNETT: If I understand the former Attorney-General

and the first member for Vancouver East, he asked a question concerning

retail gas stations which are not covered under the freeze at the

refineries level. We recently passed legislation, which that member

voted against, giving the government the power to freeze prices on the

retail level or any prices in British Columbia that weren't covered

under the Energy Act. The Minister of Consumer Services (Hon. Mr. Mair)

has this under review.

MR. MACDONALD: On a supplementary question, I am asking the

Premier if he does not recognize that when the big oil companies,

through their own self-serve stations that they operate themselves,

maintain the freeze at the refinery gate and increase the price to the

consumer at the self-serve station, they are deliberately evading and

bypassing the freeze. There is power now under the Energy Commission

Act — the other one hasn't come up — to order rollbacks.

HON. MR. BENNETT: Mr. Speaker, I might advise

[ Page 2678 ]

the first member for Vancouver East that the advice

we had from the energy board originally was that the high competitive

factor at the retail level governing all gas stations had kept British

Columbia gas prices down at a time when they were accelerating

elsewhere. That was the reason the advice of the energy board was taken

in maintaining the freeze at the refinery level but freeing up the area

where there was a competitive factor to keep competition working.

MR. MACDONALD: Final supplementary. Do I take it that the

Premier will not do anything through the Energy Commission or through

his office to see that this price increase is rolled back in the

self-serve stations?

AN HON. MEMBER: By the oil companies themselves.

MR. MACDONALD: Is that what you're telling me? That you won't do anything?

MR. SPEAKER: Order, please!

AN HON. MEMBER: They're not going to do anything. They're going to let them make the profit.

MR. MACDONALD: Inflation and evasion.

AN HON. MEMBER: Ripoff.

MINE CLOSINGS

MR. G.V. LAUK (Vancouver Centre): A question to the hon.

Premier. Yesterday, Mr. Speaker, I asked the Minister of Economic

Development (Hon. Mr. Phillips) about Doman Industries curtailing their

operations in Ladysmith and Nanoose Bay, with the loss of many jobs,

Today I have been notified that Coalition Mining Ltd. has closed down,

and that as of Saturday, June 12, 1976, over 40 men were laid off.

MR. BARRETT: Driving the mining industry out of British Columbia.

MR. LAUK: Mr. Speaker, in view of the fact that the hon.

Premier and others in his cabinet have made several announcements with

respect to the industrial strategy of the north involving coal, is this

in keeping with that strategy?

MR. BARRETT: Close down the mines under the Socreds.

HON. MR. BENNETT: Mr. Speaker, I'm not aware of the

announcement. As he knows, I was in Ottawa, but I'll take the part of

your question under advisement as to what we can do to further deal

with facilities that are laying off employees, because we are as

concerned about it as is this whole Legislature.

Secondly, Mr. Speaker, it took the member for Prince Rupert (Mr.

Lea) and his cohorts three years to slow it down; surely he will allow

us more than five months to get it moving again.

MR. LAUK: Supplementary, Mr. Speaker.

MR. SPEAKER: Unfortunately, Hon. Member, the bell, which does

not seem to be working properly at the moment, was just rung by the

hon. lady Clerk,

MR. LAUK: I have no objection, Mr. Speaker.

As a supplementary to the hon. Premier....

MR. SPEAKER: Order, please! The question period was terminated by the bell.

HON. MR. DAVIS: Mr. Speaker, if, I could, I'd like to table

two answers to oral questions which are rather lengthy. One question

relates to prices charged to senior citizens using buses travelling on

B.C. Ferries. It was asked by the first member for Vancouver East (Mr.

Macdonald) . The second is a reply to the member for Oak Bay (Mr.

Wallace) about food services on the ferries.

Orders of the day.

The House in Committee of Supply; Mr. Schroeder in the chair.

ESTIMATES: DEPARTMENT OF

MINES AND PETROLEUM RESOURCES

(continued)

On vote 140: minister's office, $80,964 — continued.

HON. G.M. McCARTHY (Provincial Secretary): Mr. Chairman, by agreement of the Whips, the Minister's office of the Department of Forests is being discussed under this vote.

MR. R.E. SKELLY (Alberni): Mr. Chairman, just before we

closed on the minister's office vote, I believe it was on Thursday

night, he was prepared to stand up and answer some of the questions

that were asked of him at that time. I wonder if the minister is

prepared to answer those questions at this time. It was just after his

question: "What are they doing to my estimates?"

I'd like to ask a question relating to the forest development roads

programme. I understand that this is one of those budgets that has been

cut this year under the forestry vote. From $7.6 million last year,

[ Page 2679 ]

this year it's down to $4.6 million, which is a $3

million cut. In view of the fact that forest development roads provides

the only access to the north Island communities, particularly Tahsis

and Zeballos, I'm wondering how much of this budget has been allocated

to such roads as the Head Bay road, the Nimpkish Valley road and the

Zeballos road in that area.

I'm also wondering if the minister plans to continue the Roscoe Bay

road between Ocean Falls and Roscoe Bay and what other roads will

receive capital development and maintenance under this

section of his

budget.

HON. T.M. WATERLAND (Minister of Mines): Mr. Chairman, I

think that perhaps detailed questions like this would better be asked

during the actual vote on roads for the Forest Service.

However, regarding the logging roads which service communities

primarily on the Island, discussions are now being held with the

Department of Highways in which certain funds hopefully will be

provided to the Forest Service so the Forest Service can actually do

the maintenance work, some funds coming from the Highways department

for that.

The Roscoe Bay road, as you know, was suspended last fall at the

point when a bridge was required. We had no plans for continuing that

road during this current fiscal year.

MR. SKELLY: The problem, Mr. Chairman, is that the Highways

capital budget has been cut back significantly this year. Also the

Highways maintenance budget hasn't been increased enough to account for

increased costs, and I'm sure the Highways minister (Hon. Mr. Fraser)

will agree with that.

In view of that fact, I'm wondering how the Forest Service, because

their forest development road budget has been cut back by some $3

million, plan to maintain access to communities on north Vancouver

Island, and particularly in my riding to Tahsis and Zeballos.

If the Highways budget has been cut back, capital and maintenance,

and if the forest development road budget has been cut back by some $3

million — cut in half, in fact — how is the minister going to assure

access to these communities during the balance of this fiscal year?

What's going to happen to winter maintenance on the Nimpkish Valley

road, on the Zeballos access road and on the Head Bay road, which gives

access to Tahsis from Gold River?

I'm also wondering, since the tenders that were supposed to go to

contract this year on the Sayward to Woss Camp

section of the north

Island Highway.... That's a highway that's been promised since 1956 by

the Social Credit government. You'll recall that when Dan Campbell, the

present minister of intergovernmental affairs, was first elected for

Comox he promised to build the north Island highway within two years.

MS. K.E. SANFORD (Comox): Gaglardi did too.

MR. SKELLY: Oh, Gaglardi did too, but we never believed his promises. (Laughter.)

But the member for Comox at that time promised to build it within a

few years — within that term, after 1956 — and the NDP kept that

promise. Something like 16 years after the Socreds had made it, we

began work on the north Island highway and we did put money —

maintenance funds — into that road. I'm just wondering if the minister

will assure us that there will be access guaranteed to the north Island

communities and to Tahsis, Zeballos and other communities over the

Nimpkish Valley road in this fiscal year.

HON. MR. WATERLAND: Mr. Chairman, I think the member for

Alberni is somewhat confused. The Sayward-Woss Camp highway is a

Highways project; it's not being built by the Forest Service. Perhaps

he could raise that same question during the Highways estimates.

As far as the maintenance of the roads....

Interjection.

HON, MR. WATERLAND: My apologies; when the actual roads are

being used for logging, then the users maintain the roads. As for those

roads which are not going to be actively used for logging, there is

provision in the Forest Service budget for maintenance of the roads,

although we are cutting back substantially on road development as such.

MR. G.R. LEA (Prince Rupert): Mr. Chairman, a question to the

minister, and the question has been asked in part by the hon. member

for Port Alberni in a previous session of the estimates.

I would like to know whether there has been any communication, oral

or written, between any of these people: Twin River Timber, Canadian

Cellulose, B.C. Cellulose, MacMillan Bloedel, or any other forest

company, in the question of share transfers, management contracts,

whether or not any member of cabinet, any civil servant, any employee

of any Crown Corporation or any person or agency representing either

government or a Crown agency, has had talks with MacMillan Bloedel or

any other forest company in terms of a transfer of shares between

either B.C. Cellulose, Canadian Cellulose, MacMillan Bloedel or any

forest company.

I think the minister can grasp the question. I want to know whether

there is any discussion whatsoever, any correspondence whatsoever,

about transferring of

[ Page 2680 ]

shares from any of the Crown corporations, B.C.

Cellulose and Canadian Cellulose — Canadian Cellulose, of course, not

being a Crown corporation, but that one also — about management

contracts, and sellout whatsoever. Transfer of shares, management

contracts — I want to know the complete story on that.

HON. MR. WATERLAND: Mr. Chairman, in answer to the question

from the member for Prince Rupert, only one completely unrealistic

offer for the purchase of Ocean Falls has come to me. It was such an

offer that it could not be considered in any seriousness whatsoever. As

far as I know, no such offers have been made; they have not come across

my desk. Early in our tenure of office there were suggestions,

overtures made to various ministers of this government suggesting

possible arrangements for the disposal of the assets the Crown has in

these forestry-based companies. But none of them were considered; none

of them came to anything except a verbal inquiry.

Now there may have been talks between Can-Cel and other Crown-based

corporations, but none of these things have come to my attention as

long as I have been the Minister of Forests.

MR. LEA: Mr. Chairman, and also management contracts — in

other words, that MacMillan Bloedel would be hired as management for

Canadian Cellulose, Twin Rivers Timber or B.C. Cellulose.

HON. MR. WATERLAND: Mr. Chairman, so far as I know, no such

contacts, communications or suggestions have been made. They have

certainly not been made to this minister.

MR. LEA: One more question, Mr. Chairman, just to nail this

down: would the minister be aware of any talks of an official nature

that may have gone on?

Interjection.

MR. LEA: Okay. The minister says that he's not aware of any

talks. If talks had gone on, would you be aware of them? Is it possible

that talks could have gone on by either one of your colleagues or

someone else around the items I have mentioned? Is it possible? Has the

Premier talked to anybody?

Interjection.

MR. LEA: So you're not completely denying the fact.

HON. MR. WATERLAND: Could I answer your question, Mr. Member,

by saying that so far as I know no such talks have taken place? We

could speculate on the possible/impossible forever, but it would mean

nothing.

MR. J.R. CHABOT (Columbia River): Mr. Chairman, I think

everyone in British Columbia fully recognizes that the forest industry

plays a dominant

part in our economy, that it contributes 50 per cent

of all the income in this province. I want to say at the outset, before

I make my remarks, that I am a strong supporter of parks in the

province of British Columbia. Nevertheless, I have to recognize the

fact that we are facing a very serious situation within the

constituency of Columbia River because in the last three and a half

years that government over there hasn't been particularly concerned

about jobs in the forest industry or any other industry in this

province.

SOME HON. MEMBERS: Hear, hear!

MR. CHABOT: That former government, which mouthed platitudes

about multiple use, has committed considerable land in my constituency

to a single-use concept. That pertains to the establishment of the

Purcell Wilderness Conservancy, which is 119,000 acres in size, the

establishment of the Top of the World Park and the expansion of the Mt.

Assiniboine Park extension.

Those people over there applaud because apparently they're not happy

with people working, because the establishment of these parks and these

wilderness conservancies in my constituency means people are facing

unemployment. That group over there has the gall to applaud that kind

of action. They bring to mind the kind of statement — I won't use the

kind of derogatory words that were used by the minister when I picked

up the map outlining the Purcell Wilderness Conservancy — in which he

said that the next wilderness conservancy will be established in the

vicinity of Golden at the expense of jobs for my constituents.

MR, LEA: He didn't say that.

MR. CHABOT: No? I'm not going to repeat because the....

MR. LEA: He didn't say so.

MR. CHABOT: He said that the next wilderness conservancy

would be established in the Golden are "in the "g--- d----" Golden

area; that's what he said.

Interjection.

MR. CHABOT: That's what he said!

MR. CHAIRMAN: Order, please!

[ Page 2681 ]

MR. CHABOT: The forest industry in my constituency, now that

it has locked in 222,000 acres into a single-use concept, into

wilderness conservancies and parks in a constituency that has more

natural parks and provincial parks per capita than anywhere else in the

world.... We have in my....

Interjection.

MR. CHABOT: Well, there's the member for Know-it-all-for

Cowichan (Mrs. Wallace). (Laughter.) She doesn't recognize that in my

constituency there are seven million acres of national parks — Yoho

National Park, Glacier National Park and Kootenay National Park — seven

million acres. Now we have also the massive Bugaboo class A park, we

have the Hamber provincial class A park, and we have the Assiniboine

class A park; we don't want any more parks.

SOME HON. MEMBERS: Oh, oh!

MR. CHABOT: We have found that the establishment of these

parks.... With the expansion of parks and wilderness conservancies in

the last three years we find there has been locked in 407 million cubic

feet of timber.

Interjection.

MR. CHABOT: Yes, 407 million cubic feet of timber. Along with

the denial of access to an additional 50 million cubit feet which is

not available, 457 million cubic feet of timber has been locked into

parks.

The second member for Victoria (Mr. Barber) laughs about this, but

he doesn't recognize the fact that we're told in the House by the

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

Williams) that the timber operators, the small operators, in my

constituency face a cutback in allowable cut of at least 25 to 30 per

cent, which means jobs in my constituency.

Now we're facing a further intrusion into the forest economy within

my constituency with the proposal that is presently being put forward

for the establishment of the Palliser wilderness area. The Palliser

wilderness area comprises approximately 100,000 acres of area in my

constituency. If this area — along with the other intrusion, the other

establishment of single-use concepts to the detriment of jobs in my

constituency — is established, I assure you that you can look forward

to much more unemployment in my constituency.

I want to ask the minister what his attitude is toward the serious

situation which exists in my constituency, and whether he's going to

tolerate the kind of situation we are facing in my constituency where

jobs are at stake when British Columbians have never faced such a high

degree of unemployment. And the member for Victoria applauds the

unemployment; he's happy about unemployment in British Columbia, and

he's suggesting there should be more unemployment in my constituency.

All I want to say is that in my area there are more parks than anywhere

else in British Columbia or in the world, We don't need any more! What

we want is jobs! We want jobs in the forest industry; we want jobs in

the mining industry; we want jobs in the recreational industry. We want

to make a living in my constituency.

MR. G.V. LAUK (Vancouver Centre): Well, Mr. Chairman, the minister nodded to me to answer, so I'll answer on behalf of the minister. (Laughter.)

Mr. Chairman, the unemployment in the constituency of Columbia River

hasn't been caused by parkland. I know the hon. member has spoken

against parkland year after year; he's against parkland.

MR. CHABOT: That's not true.

MR. LAUK: He's against preserving the wilderness. He's

against preserving this corner of the earth from the massive pollution

and destruction caused by the major development firms. He's against

that.

The unemployment rate in Columbia River has been caused by the very

questions that have been raised in this House by the opposition

members, Mr. Chairman. He hasn't been listening. Where was he? We just

stated that the loss of jobs in Columbia River was caused by the 7 per

cent sales tax — everybody's going to Calgary. The member himself went

to Calgary to buy a suit because he knows that 7 per cent sales tax

doesn't exist in Alberta.

It's the regressive-taxation members that have oppressed the economy

of this province, and it's that government over there that has caused

the loss of jobs in his constituency. He's raising a smokescreen in

this legislation chamber today; he's trying to get something in Hansard

for the good people of Columbia River. Well, they're not going to

believe it, because they know the truth: it's the regressive, backward,

steel-boot legislation of the government over there that has caused the

highest unemployment rate in the history of this province. And for him

to raise parkland as an excuse for the good people of that constituency

who are walking the streets without an income is a sham and a fraud. He

should resign his seat in this Legislature for trying to raise a

smokescreen. What a disgraceful performance, Mr. Chairman. Absolutely

disgraceful!

Doman Industries...a member of the British Columbia Development Corp., a man who has been

[ Page 2682 ]

long since known as a member of the Social Credit

League, and now the coalition party, has closed down his plants in

Ladysmith and Nanoose, laying off several dozen people — more families

unemployed. Coalition mining, because of the neglect of this

government, has closed down another 40 people. We now have 115,000

people unemployed in this province. Why? In June, in the summer months,

when everybody should be employed, we have the highest unemployment

rate in British Columbia.

AN HON. MEMBER: Hear, hear!

MR. LAUK: Need I say more about those facetious comments of the hon. member for Columbia River?

MR, CHAIRMAN: Now to vote 130, please.

Interjections,

MR. LAUK: With respect to the Minister of Forests, who, I'm

sure agrees with everything I've said — I've spoken on his behalf in

answer to the member for Columbia River. I've noticed that he has not

said — and he should say, because he's an honourable man, he's fair and

honest and not yet tarred with the brush of many years of politics....

Interjections.

MR. LAUK: He admits his mistakes — he said he was a little

remiss. But he admits his mistakes. Now he should get up and set the

record straight, Mr. Chairman.

Whonock Industries issued an annual report, and they've said

something here that is repeated in annual reports throughout the whole

lumber industry, and it's something that the coalition party, during

the election, never mentioned. They were strangely silent about the

attitude of this government, and the former Minister of Forests,

towards the forest industry because, you see, they were doing a job of

creating a myth in this province for the consumption of voters during

an election campaign. Something they neglected to say — they didn't

tell lies, but they didn't tell all the truth. I thought: all right,

it's not going to get the press....

AN HON. MEMBER: Why not?

MR. LAUK: People are not going to generally know it. But I

want on the record what we did for the forest industry when we were the

government of this province.

AN HON. MEMBER: Nothing!

MR. LAUK: We helped preserve jobs during the worst recession in the forest industry in the history of North America.

We took a flexible action; we took action to preserve jobs in the

interior and the central part of British Columbia. Whonock says — and

this is a company that's not known to be an active supporter of the New

Democratic Party of British Columbia: "The government of the province

of British Columbia have recently" — and this is in 1974, — "come

forward with considerable aid to the interior independent sawmilling

companies with a reduction in stumpage rates to minimums, and

guidelines for chip prices, thereby enabling sawmills to operate and

maintain full employment."

This is repeated in annual report after annual report. I've not yet

heard that hon. minister stand in his place and say that yes, we did

the right thing, and forget about the mythology of the election.

The final point with respect to the forestry aspects of this minister's estimates is raised in an editorial today in The Province . It says: "Forester Williston," and it supports.... It is the first time that The Province

editorial page, the editorial page which speaks substantially for the

coalition government.... Let's face it, everybody accepts that not the

working press, but the editorial page of The Province

we know is currently the spokesman for the coalition government. And it

tries to sneak past an excuse; it tries to sugar-coat an appointment of

a former Social Credit cabinet minister, a man who was on the board of

directors of the British Columbia Railway when it deliberately hid the

losses of that railroad over many years, a man who was roundly

criticized by environmentalists, not only in this province but

throughout North America, for his 19th century attitudes toward forest

use. He is now, I am told, being touted as the new head of B.C.

Cellulose.

MR. LEA: He went to New Brunswick to run a railroad.

MR. LAUK: This will deal a fatal blow to the integrity of

B.C. Cellulose and Canadian Cellulose — a fatal blow, Mr. Chairman. He

should not be pressured by the Premier; he should not be pressured by

the old-line politicians in his cabinet. He must have the integrity

that I know he does have. He must resist any pressure to appoint this

man to such a high position in this province.

MR. G.F. GIBSON (North Vancouver-Capilano): He'll be the real Minister of Forests.

MS. R. BROWN (Vancouver-Burrard): That's right!

MR. LAUK: This is a good point. The hon.

[ Page 2683 ]

member for North Vancouver-Capilano says that

Williston will become the real Minister of Forests. I warn you, sir,

through you, Mr. Chairman, that if that appointment is made, you will

no longer be a minister; in reality you will be a puppet, you'll be a

showplace, a facade as a minister.

AN HON. MEMBER: He is now.

MR. LAUK: Oh, I don't accept that. But I will say that the

pressure is on that minister. We know on this side of the House that

the pressure is on you, sir. Resist it!

AN HON, MEMBER: Hear, hear!

MR. LAUK: We know you're an honest man. Resist this political

hackery! Don't appoint Ray Williston to that board. It will haunt...if

I can borrow a phrase from the Liberal leader (Mr. Gibson), it will

haunt the life of your ministry.

MR. CHAIRMAN: Please address the Chair.

MR. LAUK: Mr. Chairman, it would be the worst possible choice

to make. I do not wish to further erode Mr. Williston's reputation in

this province. I wish that he were not involved in the public life in

this province to avoid the necessity of doing so. But can we stand as

honourable members in this House in the opposition and let an

appointment like this go past without comment? I would say that's

impossible.

I would ask the minister now to refute any such suggestion that Mr.

Williston will be appointed to that high office. I would ask him to

clearly state that any such appointment to that office will be a person

who is skilled in the field of forestry and in the management of forest

companies, without political connection and at arm's length from the

government — the way it should properly be. I ask the minister to make

that commitment now.

MR. L. BAWTREE (Shuswap): I would like to take a place in

this discussion on the minister's salary at this time, if I might. I

would like to bring to the minister's attention, Mr. Chairman, the sad

state of the industry, particularly the logging and the lumbering

sections of the industry, in my riding. The forest industry still is by

far the most important industry in this province, and as far down the

road ahead as we can see it will remain one of the most important

industries and it will determine the standard of living of everyone in

this province. The standard of living of everyone in this province,

regardless of whether they live in Shuswap or Omineca or in downtown

Vancouver, is determined to a very large degree by the harvesting of

the timber of this province.

Mr. Minister, although I do not have many answers, I would like to

point out some of the difficulties being encountered in the industry.

The costs of lumber production in this province are getting

completely out of line with those areas where we must compete. I would

just like to bring to the attention of the House, Mr. Chairman, some of

the changes that have taken place in the industry since 1973.

On the coast in 1973 the average log sales value was $65. That same

figure is operable today, It is still $65 but the average cost of

logging, according to the appraisal statistics, has gone from $32 in

1973 to $62 in 1976 for an increase of 94 per cent. In the interior the

average selling price of lumber has gone from $143 in 1973 to $150 in

1976 and the logging cost allowance has gone from $21 a cunit to $36 a

cunit for an increase of 71 per cent.

What this means, Mr. Chairman, is that the revenue from stumpage has

gone from $248 million in 1973 down to an estimated $35 million this

past year. The labour costs in the industry have eaten up the stumpage,

and stumpage is the people's share of the natural resources.

There have been some changes made just recently in order to help the

industry at least to overcome some of the environmental constraints and

the high costs.

Mr. Chairman, I would like to adjourn this debate,

Interjection.

MR. BAWTREE: I would just like to pause here a moment, while the Premier would like to say a few words.

HON. W.R. BENNETT (Premier): I would ask leave of the House

to introduce a very important visitor to our Legislature this afternoon

— in fact, three very important visitors who have a long history in

politics. Mr. Chairman, may I have leave?

Leave granted.

HON. MR. BENNETT: Mr. Chairman, it's my pleasure to introduce

to the Legislature this afternoon the member for Rocky Mountain, the

leader of the Progressive Conservative Party and the Leader of the

Opposition in the parliament at Ottawa, Mr. Joe Clark.

Mr. Clark has a history of political activity and contribution to

the country and, I might say, starting as far back as 1963, he was the

president of the Progressive Conservative Student Federation. He later

moved on to be special assistant to the Hon. Davie Fulton in 1967. He

was executive assistant to the Hon. Robert Stanfield, the Leader of the

Opposition in the years 1960 to 1970, and was first elected to

[ Page 2684 ]

the Parliament of Canada in 1972, as I said, as the

member for Rocky Mountain. He was re-elected in 1974 and perhaps, even

for those of us who could stand back in a detached way and watch, he

was elected leader of the Conservative Party in one of the most

exciting contests the country has watched in this year of 1976.

Mr. Clark is accompanied by his wife, Maureen, and is accompanied by

the wife of the member for Oak Bay (Mr. Wallace), Kathy. I ask the

members of the Assembly to welcome Mr. Clark, Maureen and Kathy.

MR. G.S. WALLACE (Oak Bay): Mr. Chairman, you're always in such a hurry to get on with the estimates.

Mr. Chairman and fellow members, it gives me great honour and pride

to welcome our national leader and his lovely wife, Maureen. I notice

that our politicians are often accused of being in favour of

motherhood. We've got a leader and his wife who certainly support that

concept and I'd like to congratulate you.

The Premier mentioned the convention which elected our national

leader, and I want to say how confident I am that our leader, whose

roots are in the west, is a man with a very clear national and

international overview of events. The main reason that our leader is

here today is to meet with Premier Bennett in a series of meetings with

other provincial premiers and also to build some of the understanding

which I believe recent events have shown is somewhat lacking at the

federal-provincial level.

Our leader, Mr. Clark, met yesterday with President Ford, and I

think this is another example of the wide and responsible attitude

which Mr. Clark is bringing to his role as national leader. I'm just

delighted that he has been able to be presented to the House today, and

I appreciate the courtesy of our Premier.

MR. D. BARRETT (Leader of the Opposition): Mr. Chairman, I,

too, would like to join in a welcome to Her Majesty's Loyal Leader of

the Opposition and to Ms. McTeer; also to Mrs. Wallace, who is

accompanying the hon. Leader of the Opposition. I am pleased to note

that the Leader of the Opposition is visiting all of the provinces as

his predecessor did. I was a fond admirer of your predecessor who,

above all, was a gentleman. I thought that those qualities were

outstanding in the role that he played, and you have already displayed

that same form and that same approach.

In light of your responsibilities federally, may I conclude by saying bienvenue and bonne chance.

MR. GIBSON: Mr. Chairman, I, too, would join in welcoming to

the chamber Mr. Clark and Ms. McTeer and Mrs. Wallace, very much so. I

had the opportunity of working in Ottawa at the same time that Mr.

Clark was the very respected assistant of Mr. Stanfield. I had also the

opportunity of running federally against his colleague, John Fraser, in

1972. John lost in a sense and had to go to Ottawa. (Laughter.) The

national Leader of the Opposition is very welcome here, Unlike Ottawa,

he will note the tremendous numerical strength of the provincial

Liberal Party in this House (laughter), and we all make him welcome.

MR. BAWTREE: Mr. Chairman, I was elaborating on some of the

things that are happening in the industry regarding the income from

stumpage. It is being eaten up to a very, very large degree by the

increased labour costs. The environmental constraints that have been

relaxed to some degree recently — any advantages are going to be eaten

up by the cost of labour.

The next step, Mr. Chairman, in my opinion, will be to find the need

to subsidize our logging in this province, our lumbering industry, by

the direct taxation of our people. This, to me, would put the province

so far down the road that they would probably never recover in their

logging and lumbering industry.

There are many indications that the viability of the sawmills in my

riding of Shuswap, and I'm sure most of the mills in the interior of

this province, is getting a great deal worse. There are nine major

sawmills in the Shuswap riding and I believe three of them, or 30 per

cent, will be out of business in the very near future. If this comes to

pass, Mr. Chairman, this will have a very serious effect on this very

important part of the province and, to a lesser degree, to the total

province. The problems in the industry are caused for many reasons, and

I would like to mention just a few of them. The member for

Revelstoke-Slocan (Mr. King) stated there were great advantages to the

industry in this province. I can tell you that there are a great many

disadvantages also — disadvantages that many of the areas against which

we have to compete do not have.

Some of the companies that are operating in my riding, Mr. Chairman,

are companies that are also operating in the southern United States. In

the southern states they can grow a crop of trees in anywhere from 20

to 30 years; up in this area it take us anywhere from 80 to 100 to 120

years to grow a crop of trees. Their harvesting and reforesting down in

that area are also done by mechanical means while ours, to a very large

degree, because of the terrain and snow conditions, have to be done by

hand.

I would like to compare some of the wages paid in the U.S., where we

want to sell our lumber, with those paid in B.C. and in my riding. The

basic rate in Arkansas is $2.75 an hour compared to $6.14 in my riding;

a millwright in that area gets $4.64 compared

[ Page 2685 ]

to $8.70; a sawyer gets that same $4.64 compared to

$8.30 for a sawyer in my riding. The wages in B.C. will go up on July 1

by 75 cents an hour to $6.89, which will increase the wage spread

between the province and our competitors to an even greater degree.

These wage rates are only just part of the total labour costs, because

there are fringe benefits which represent an additional 20 per cent

cost and which must be charged to that labour.

I do not begrudge the workers in the industries their high wages or

their fringe benefits. Mr. Chairman, in fact, I know they are underpaid

in relation to most of the employees in the public sector. Just

recently the hospital workers in this province were awarded a

settlement which must not only be borne by the private sector but also

must be matched eventually by that private sector. The cost of this one

increase alone in this public sector is going to be $60 million. That's

what the cost to the province for that settlement in the hospital

industry is. I believe that the workers in the primary industry are

entitled to the same benefits that the public sector is able to get.

The public sector workers have far greater security in their jobs.

They have higher wages, shorter working hours and more fringe benefits.

Just a few of the fringe benefits that they receive that the workers in

the sawmill industry or the logging industry do not are four weeks of

paid vacation after just one year, six weeks after 24 years, and

uniforms are supplied and cleaned. We don't get that in the logging

industry. One of the biggest problems facing the forest industry is how

to match these large awards in the public sector with what can be paid

for by those of us who are working in the lumbering industry.

I have to admit, Mr. Minister, through you, Mr. Chairman, that I

believe your problems are nearly insurmountable and certainly will not

be solved in isolation. You've seen the detrimental effects other parts

of our economy can have on this primary resource, and B.C. Rail, of

course, is a very good example. It's unfortunate that the settlement

was delayed for several days. It was unfortunate that there were people

out of work for a longer period of time than necessary.

There are going to be problems with the native people that are going

to have to be solved. That really is not within your department but

it's going to have a great effect on the lumbering industry.

Wage awards in the public sector, I've already mentioned, are very high and probably cannot be met in the forest industry.

Highways — again this is not a department over which you have any

control and yet it has a very great bearing on how effective our

logging industry can be, in the interior of this province particularly.

Human Resources is another area that has a great effect on the

lumbering industry because when the snow gets very deep in the interior

and in our mountain areas, it takes a lot of dedication for most people

to want to go out and cut trees down. If they can get paid by the

Minister of Human Resources to stay at home this is what is going to

happen.

Parks and recreation — the member for Columbia River (Mr. Chabot)

brought this subject up. We have removed large, large areas from

production and have kept it for a single use. We have put parks ahead

of jobs. We have too many people in this province, Mr. Minister, who

said: "To heck with you. I'm all right, Jack, I've got a good job. I

want to enjoy these parks and I don't really care if people are out of

work because they can't harvest these trees."

I would like to say just a few words, Mr. Minister, through you, Mr.

Chairman, about one other aspect that is not going to have any effect

on the lumbering industry to any great extent but does affect another

user in our forests today, and that is the cattle industry. The cattle

industry feel very concerned at this large, large amount of land that

has been set aside for a single use, and prohibiting its use for the

raising of food in this province.

I would just like to say in conclusion, Mr. Minister, a few words

about a report that was done by Dr. Alistair McLean with regard to the

damage that might be done by cattle on our rangeland. Dr. Alistair

McLean is from the research station in Kamloops and his main findings

in the research that he did was that the cattle damage to rangeland was

only of any importance in the early spring and early winter. In early

winter when the snow is deep — and most ranchers, of course, know very

well they should not have their cattle out there at that time — there

is some damage. "But with these exceptions, joint use of range by

cattle and mule deer is mutually beneficial, under moderate stocking

rates and good management."

Dr. McLean goes on to say that "cattle are especially beneficial to

rangeland in early fall when they clean out the old grass growth. This

makes it easier for deer to reach new shoots during the following

spring."

I'm glad to see, Mr. Minister, that this philosophy is now being

looked on with greater favour by people in all the resource areas, and

in the Ashnola and the Junction areas the multiple use is going to be

practised, we hope, in the very near future,

MR. SKELLY: Mr. Chairman, the member for Columbia River (Mr.

Chabot) and the member for Shuswap (Mr. Bawtree) mentioned the

importance of the forest industry to British Columbia. I don't think

there's a single member on this side of the House who disputes the

importance of that industry to this province. But I think we're

concerned about the way the forest industry has been managed under the

present Social Credit government and under the

[ Page 2686 ]

previous Social Credit government, and I'd like to

re-emphasize something that I said last Thursday: when we met with the

Council of Forest Industries' executive, they congratulated the members

of this party on the flexible approach that they adopted when they were

in government to the forest industry in a time of severe economic

dislocation throughout the world, in the markets that that forest

industry enjoys throughout the world, and they congratulated us on our

flexible approach to the forest industry which helped to keep that

forest industry afloat during difficult times.

They expressed the wish that our American counterparts, as

governments south of the border, had adopted the same flexible

approach, I imagine they'd be expressing the same wish with this

government — that they would adopt the same flexible approach — but I

don't imagine they will. They seem to be going into this management of

the forest industry with some strongly preconceived notions and, I

think, notions that will be damaging to other resource values in the

provincial economy.

The member for Columbia River pointed out that at the present time

50 cents out of every provincial dollar is attributable in some way to

the forest industry. It's interesting, looking back over the Social

Credit regime and doing a little historical research, that in

presenting amendments to the Logging Tax Act, way back in 1953, the

Hon. Robert Sommers — and that was the last time that they had combined

the Minister of Mines and Forests, and it was a very unfortunate

combination at that time as well — but at that time, in presenting the

amendments to the Logging Tax Act, that minister said that 62 cents out

of every provincial dollar was attributed to the forest industry, so

we've gone down in 20 years of Social Credit reign, 20 years of Social

Credit administration; less of the provincial economy has been

attributable to forest industry than in 1953.

Bob Williams, the former Minister of Lands and Forests, also pointed

out what happened to the small sawmilling industry in the province —

those family-owned sawmills that were the centre of their community,

that enjoyed the confidence of their community — 2,500 sawmills existed

when Social Credit took office in 1952 and by 1972 there were less than

1,000 left.

SOME HON. MEMBERS: Shame!

MR. SKELLY: The policy of the previous ministers, under the

previous Social Credit government, was to drive those small sawmills

out of business and replace them with the huge integrated companies.

That was the policy of that former Social Credit government, and I

imagine that we can expect a return to that kind of policy under the

present government considering the sources of campaign funds that that

government has.

MR. L.B. KAHL (Esquimalt): What happened to Williams?

MR. SKELLY: So there was a decline from something like 2,500

sawmills to less than 1,000, and under the NDP administration that

number increased — under the administration of the former Minister of

Lands, Forests and Water Resources. Somebody mentioned Ray Williston.

Where is he today? You know, under Williston's administration we had a

small company called Northwood Pulp, a subsidiary of Noranda that had

operations up in Prince George, and that company grew from one of the

smaller operations in British Columbia to one of the larger operations

— the second largest operation, I believe, in British Columbia — under

the benevolent regime of Ray Williston, who also represented the same

area in which Northwood Pulp operated,

When Ray Williston left office...and the biggest example of

broadcast burning that ever took place, Mr. Chairman, was what happened

to Ray Williston's files when he left office. I think he left office

and went on a tour of New Brunswick at the invitation of Fraser Lumber

Co., which was a subsidiary of Northwood Pulp, and I believe he was

hired as a consultant to Fraser Lumber before being hired by the

Province of New Brunswick to revamp their forest administration,

MR. CHAIRMAN: Order, please, Would the member please show how this relates to the administrative responsibilities of the minister?

MR. SKELLY: Well, somebody simply read into the record the accolades given by The Province

editorial this morning to Ray Williston and suggested that he would be

a good manager for B.C. Cellulose, replacing Ray Jones. I'm not sure

that with Mr. Williston's connections to other large forest companies

in the province, and with the management of the forest industry which

took place over his regime, that he would be an appropriate person to

hire as chairman of B.C. Cellulose, or chief executive officer of B.C.

Cellulose.

There was a cosy connection between that minister and certain

elements in the forest industry. I hope that they are not considering

the appointment of Ray Williston as chief executive officer of B.C.

Cellulose Corp,

The member for Columbia River (Mr. Chabot) also mentioned how the

last government created parks and recreation areas that took something

like 450,000 acres — or was he talking about millions of cunits? — out

of production in this province. What he didn't say was there was no

access to a lot of that timber because the national parks branch refused

[ Page 2687 ]

access through national parks to that area between the national park

and Mount Assiniboine Park. When I considering the resource values in

that area between the national park and the previous boundaries of

Mount Assiniboine it had to be taken into consideration that access was

denied by the federal government through the national parks to that

timber between Mount Assiniboine and the national park.

Interjection.

MR. SKELLY: I'm talking about the area you were talking

about, which is the area between the national park and Mount

Assiniboine Park that takes up a lot of that 457 million cunits.

I am really concerned about the parks in this province. Under the

previous Social Credit government we lost more than two million acres

of parkland to exploitation by forest companies and to exploitation by

mining companies, which the present Minister of Mines seems to be

committed to, although the Premier seems to have some difference with

him, and possibly the Minister of Recreation and Travel Industry (Hon.

Mrs. McCarthy). I am concerned that they are going to take this land

out of parkland, that there is a bit of pressure from the lighweights

in the back bench such as the member for Shuswap (Mr. Bawtree) and the

member for Columbia River (Mr. Chabot). I hope he doesn't respond to

that pressure.

Also, on forest development roads again, we haven't really had the assurance

from the minister that access will be maintained to the north island communities

such as Tahsis and Zeballos year-round under this vote, considering the fact

that the Highways budget has been cut back. Certainly we can ask questions of

the Minister of Highways (Hon. Mr. Fraser), but that money that was expended

in previous years was expended by the Minister of Highways through the Forest

Service and then expended on those forest development roads. I am wondering

specifically if the minister can assure the communities of north Vancouver

Island — Talisis and Zeballos — that their roads will be maintained by the Forest

Service on a year-round basis and that there are adequate funds in the budget

to maintain those roads. All he has to do is answer that question — yes or no.

It's a very simple answer; all he has to do is provide that assurance.

It is interesting how the budget amounts have shifted and how the

allocation of money has shifted in the minister's department. There

have been increases in some areas of his department and decreases in

others. I'd like to ask the minister some general questions on the

rationale behind those increases and decreases. It appears that there

has been a $5 million increase, from $4 million to $9 million, in the

scaling programme. Under the old water-scaling programme there was a

return to the government that pretty well eliminated the cost of

scaling — that balanced the cost of scaling. It appears now that the

province is paying the full cost of the weighscale programme. Perhaps

that's not the case; perhaps he an answer that question. But in any

case, it appears that the province is assuming the full cost of the

weighscale programme to the tune of $5 million this ear.

Also, there is a $4 million increase in the fire suppression budget.

Yet in general forest protection there has been a slight decrease in

the budget even though there is a tremendous amount of damage due to

forest pests. We have read a little bit about the tussock moth spraying

programme north of Kamloops and how successful that has been. But in

discussing the question of pests with the forest protection division,

apparently there are something like 300,000 acres of spruce budworm

damage in the province. They only have the money and the personnel to

do test work on something like 50 acres of the total of the 300,000

acres that are damaged by spruce budworm. I am wondering why there has

been a cutback in that department, considering the large amount of

damage that is being done by the spruce budworm in areas in the

interior of the province.

Also, there has been a $3 million increase in administration of the

department. The member for Shuswap talks about the high cost of civil

servants and how their wages are increasing drastically while the wages

in the forestry sector are falling behind the public sector. Yet we see

in the Forest Service budget that one of the areas in which increased

costs have been allocated is in the administration sector. Is that to

pay higher wages? Is that to hire more staff in Victoria? Just what is

the reason behind the increase in the administration sector?

Last year it was estimated that the cost of the reservoir waterway

improvement programme was $10 because of the recovery of funds from

that programme — that expenditures would be recovered from, I imagine,

sale of timber and debris — and I'm wondering what this programme does

cover. Is this to clean up the mess that was left behind the dams that

were built by the Social Credit government? Is that what it's for? If

so, what reservoirs are being cleaned up? Are they reservoirs behind

the dams that were built by Social Credit where no cleanup was done in

advance of construction, or inadequate cleanup was done in advance of

construction, where they went ahead and built dams without

consideration for the environment under the previous Social Credit

government? Why the increased cost, from $10 to $7 million, in this

programme?

The member for Shuswap (Mr. Bawtree) also compared wages in British

Columbia with wages in the southern pine area of the United States —

how labourers up here were making $6.14 an hour and down there they

were making $2.75 an hour and that

[ Page 2688 ]

therefore the capital was going to flee the country

to this area of lower costs. And the forest companies are always

telling us how, because of increased costs and low productivity in the

industry up here, they're moving to other areas of the world, and

especially increased costs as they relate to second-growth management,

telling us how they're going to go to places like Brazil — and it used

to be Mozambique, but it's not longer, or Angola, and a few other

places like that. The main reason for the export of capital from

British Columbia of our forest industries here to those other parts of

the world is the low wages and high productivity.

But I'd like to read into the record some of the other attributes

that seem to appeal to the companies doing business in this province

when they're making decisions to allocate capital to other areas of the

world. Here's a letter from The Vancouver Sun

of February 13, 1975, talking about the economic miracle of Brazil —

and we know that MacMillan Bloedel and B.C. Forest Products and other

companies operating in British Columbia, in conjunction with Brascan

and a few other companies, are investing in tree farms in Brazil in

advance of installing pulp capacity down there, and he talks about the

economic miracle of Brazil. And according to World Bank statistics, in

Brazil in 1970 the richest 5 per cent of Brazilians took 38 per cent of

the national income and the poorest 40 per cent of the Brazilian people

took 3 per cent of the national income.

In Brazil, 100 children out of every 1,000 born die without reaching

the age of one — die of malnutrition and disease. Indeed, conditions

for workers and peasants in Brazil are so horrible that the Catholic

bishops in Brazil, long the bastions of landlords and bourgeois rule,

have openly called for socialist revolution as the only way to

rationalize Brazilian economic and political life. Is that the kind of

stable economy that the forest industries of this province are looking

for, the member for Shuswap is looking for, moving to the southern pine

areas of the States where wages are shamefully low, moving to areas in

Brazil where not only are the poor so poor they can't afford to work,

they don't have any wealth at all, not even the ability to deliver

themselves to the workplace where companies are exterminating Indian

tribes in order to make the country safe for the forest industry? Is

that the type of situation that this government and the forest

industries which it represents prefer?

I'd like to have the minister — for a change — answer some of the

questions that have been presented to him on his department. And I

particularly refer to the questions he seemed to be prepared to answer

back on Thursday, questions relating to his own qualifications. We

asked him what his qualifications were and related it back to some

statements that he made. Mr. Chairman, I hope I am referring to the

appropriate vote here. When I asked him what his qualifications as

Minister of Forests were, he said: "Well, I've been raised in the bush

in this province and I've probably spent more time in the bush than

most people have." I'm wondering if he has any other qualifications

other than those.

Interjection.

MR. C. BARBER (Victoria): I'll be quite brief. I wish to

start by reporting to this House that I witnessed a very strange event

three nights ago when the moon was full. I was driving by Beacon Hill

Park and I saw the member for Columbia River (Mr. Chabot) slinking

about like a fox.

MR. CHAIRMAN: Is this on vote 130?

MR. BARBER: It most certainly is. He had in his hand an

enormous tape measure and I saw the member for Columbia River bounding

from tree to tree measuring the stump. It occurred to me that night

that this was a very peculiar kind of behaviour and I wondered what was

going on here. He was there in Beacon Hill measuring our trees. Today

in his speech, he made it clear what was going on, and I wonder if this

House might join me in congratulating Sir James Douglas for being

possessed of prophetic wisdom — more than 100 years ago — to declare

Beacon Hill Park in Victoria a municipal rather than a provincial park,

because, were it in provincial hands, and were one to conclude from the

actions of the member for Columbia River measuring the trees in Beacon

Hill Park and their suitability for cutting — because parks are

wasteful unless you can cut the trees within them, aren't they? — we

would lose our park. It would be a total wasteland.

Interjections.

MR. CHAIRMAN: Order! Order, please. The second member for Victoria has the floor.

MR. BARBER: So, hearing considerable applause for the

resolution to congratulate old Sir James for making it a municipal

rather than a provincial park, thus keeping it safe, I wish to proceed

onto another topic. A couple of years ago the predecessor of the

present minister was responsible for helping develop one of the most

remarkable, one of the most inventive and imaginative community and

economic projects we've yet seen in the province of British Columbia. I

am referring to something that is generally called the Burns Lake

project, and I have a couple of questions that I would like to put to

the minister about it.

The aspect of community development implicit in

[ Page 2689 ]

this project is the one that interests me the most.

What we have seen in the Burns Lake Native Development Corp. and in the

Burns Lake Community Development Association is the remarkable

combination of two different kinds of energies, two different kinds of

skills, two different kinds of needs. What we have seen in this

outstandingly successful project is the combining of local and native

talents and skills, energies and traditions in the formation of a

community development association that did not previously exist and

which has, in its present form, taken outstanding steps to reduce

unemployment, to obtain training for its workers and to broaden

substantially the economic base now available to the native Indians in

the Burns Lake area.

Simultaneously, the previous government chose to grant that

association an 8 per cent interest in Babine Forest Products Ltd. And

through the granting of that interest it was able to give, in the form

of equity, a genuine interest and a genuine purpose to the involvement

of native Indians in these developments in the Burns Lake area.

I wish to review a couple of them very briefly and then ask the

minister whether or not in principle he believes that this combination

— government support of native training and retraining and of equity

participation in the sawmill at Babine — is something that he supports,

whether or not he is willing to support it in cabinet, whether or not

he is willing to take additional initiatives and whether or not he is

willing to meet certain specific requests made by the Burns Lake

Community Development Association in a brief which, I understand, has

recently been presented to him.

The brief itself has already been adopted in part by that provincial

government. The Minister of Human Resources (Hon. Mr. Vander Zalm) in

his estimates allocated the sum of $188,000 to the Burns Lake Community

Development Association. I congratulate the minister for doing that and

I congratulate the Minister of Forests (Hon, Mr. Waterland) for, no

doubt, advising him that this was a reasonable and proper project and

deserving of his support. But there are additional requests that have

been made to the minister and I wonder if today he will tell us about

them.

Before I get onto that though, I would like to review briefly the

work of this association, and to point out again the outstanding level

of imagination, the outstanding level of community participation and

the outstanding results derived from the Burns Lake project. This

project has provided employment for more than 300 persons. Of those

300,148 at this time are native Indians. This programme has provided

educational upgrading for more than 130 persons so as to provide,

through that training, opportunity to participate in industrial work

throughout Canada.

The Burns Lake project has provided training for more than 110

persons in skills varying from office procedures to heavy equipment

operation.

To quote from their report — and it is by most accounts, including

that of the Department of Human Resources, an accurate report — the

Burns Lake project has resulted "in a reduction in the local welfare

rolls by approximately 60 per cent, and in a reduction in unemployment

insurance claimants by more than 50 per cent." Because of the

initiative taken at Burns Lake, 60 per cent of the people previously on

welfare are no longer on welfare in Burns Lake. They are now working.

They are supporting themselves and their families. Because of the

initiative taken by this project, 50 per cent of the people who were

previously in receipt of unemployment insurance are now working and

supporting themselves and their families. This is an outstanding

project. It's worthy of the minister's support; it's already won that

of his colleague, the Minister of Human Resources.

In the operations of Babine, as they report here, some nine million

board feet have been produced in an outstandingly short time. The mill

itself began four months before it was scheduled to begin. The

operations began four months in advance because the people of that

community backed it 100 per cent, because the people who came in from

the outside to provide the training, the expertise and the management

backed it 100 per cent, and because the government of the day showed

initiative and leadership and developed it in the first place.

They have made a very specific request, though. They have made a

request to that minister. I wonder, in conclusion, whether or not he is

willing today to tell us whether or not he chooses to exercise his

leadership and the particular role that he plays in cabinet to meet a

request for application for additional capital loans and required

timber.

I won't go into the tremendous details of it, but they include in

1976 expansion by an additional 25,000 cunits per annum operation. They

ask for some very specific help from this government in order to obtain

it. They make some requests that, it seems to me, are reasonable and

fair. They make requests on the basis of practical experience, the

result of which is success, success, success: reduced welfare by 60 per

cent; reduced UIC claims by 50 per cent; 300 people employed; 130

people trained — of the 300 people employed, 148 are native Indians.

This in 1974-75 was an outstanding achievement; it deserves praise

from every side of the House. I want to know from the minister whether

or not he recognizes the achievement, whether or not he supports the

opportunities for further achievement in the future, and whether or not

he is willing to grant the requests made in this document for

additional timber-cutting rights, for the cunits required to allow

[ Page 2690 ]

the Burns Lake Native Development Corp. and the Burns Lake Community Development Association to continue its quite remarkable work.

MR. C.S. ROGERS (Vancouver South): Mr. Chairman, last week

the Leader of the Opposition, who is now the member for

Revelstoke-Slocan (Mr. King), was speaking on these estimates, and he

talked about the natural advantages that the lumber industry in the

province has over the United States, especially Washington and Oregon.

While he pointed out a lot of natural advantages, he didn't point out a

lot of natural disadvantages which I think should be read into the

record. Those people who have been involved in the industry for some

time know the list of disadvantages is quite substantial.

To start off, the bulk of the machinery used in the forest industry

is manufactured in the United States. With some exceptions in heavy

steel spars, the great majority of the stuff is imported into this

country. Everything from pickup trucks to hickory axe handles has to be

brought in and is considerably more expensive than it is in the United

States.

The same thing applies to everything from hardhats to raingear.

Caterpillar Tractors from Peoria, Illinois, are extremely expensive,

much more here than they are in the United States That is something

which we have to take into account.

The second thing that I'd like to bring up, Mr. Chairman, is the

fact that during my maiden speech I spoke on the subject of debris and

debris control. I spoke about the floating debris that persists in the

waterways of the Strait of Georgia and the Strait of Juan de Fuca and

persists all the way up to the Queen Charlotte Islands and other areas.

While some of this debris is the direct result of the forest industry,

the percentage of the debris that is caused by the forest industry is,

in fact, only 20 per cent of the total debris that currently infests

the waterways and the beaches of the province.

Interjection.

MR. ROGERS: The Forest Service put out that result, Mr.

Member. If you checked into it as I did, you'd find that was also true.

In fact the Council of Forest Industries and the forest industry in the

province have been quite busy working on trying to clean up the debris,

although they've, in fact, spent 80 per cent of the total budget

involved in debris control.

Now there are three forms of debris that are prevalent, or there are

at least three uses for the debris that's available. The majority is

hemlock logs, which are the sinker type or the deadhead variety. There

are several sawmills currently involved in the procedure of cutting and

reclaiming this wood. However, they're paying stumpages based on the s

same rate as would have to be paid for wood that came in on a regular

boom, which is a bit of inconvenience because of the problem of towing

and extra cost incurred. The second is that, basically, a log that has

bark on it is a log that can be chipped, and a log that has no longer

got the bark on it is a log that can't be chipped. This is primarily

because of the ingestion of sand into the fissures of the log. So there

are three purposes: one is sawn lumber, one is chips, and the third is

to be run through a bone mill and put into hog fuel.

I would ask that the minister in his continuing efforts in his

department would give more consideration to debris control. In the

past, in a position on the Fraser River at a little place called

Laidlaw, they have built a wing dam during the freshet which has

captured an awful lot of the debris that is natural and also man-made

which comes down the Fraser. They have taken this wood and salvaged

what they could and burned the rest. This has been a Forest Service

project. Some of it has been successful. This year it wasn't continued.

I would ask that they give serious consideration to making it a

permanent effort. The mayor of Surrey had his vessel holed by a log

that was floating, and there are several other people that boat. All of

us who are involved in maritime exercises, including the float-plane

pilots of this coast, would like it very much if we could do something

to help eliminate this debris.

The other thing that I'd like to say is that we don't have a

monopoly on the world's production of softwoods, as has been pointed

out. The Soviet Union has the capability, if they would ever get their

act together, of running very, very extensive inroads into the world

softwood markets. We must remain competitive, as many other members of

this House have said. We are in a position to have our No. 1 industry

seriously curtailed if we don't maintain our very competitive position

in the world market.

MR. GIBSON: I want to draw attention to a really basic

problem at this stage and I hope that the minister will tell us what he

can do about it. The forest industry is very sick at the present

moment, and I'll give a few figures to support that contention, but

before I do that, let me say that British Columbians have to appreciate

that if the forest industry is sick the province is sick, and that's

exactly where we are today.

We have seen a situation where the forest industry in the past five

years has switched from being the engine of growth in British Columbia

to a virtual no-growth industry. I think that the officials sitting

behind the minister will assure him that that is indeed the case — and

not through their fault. I'm not meaning to imply that.

One of the most important briefs that was submitted to the Pearse commission, Mr. Chairman,

[ Page 2691 ]

wasn't right on target of the Pearse commission, but it's something

that should be brought up in this House, and that's the brief that was

submitted by Murray Leith, who was at that time the president of the

British Columbia

section of the Investment Dealers Association of

Canada. Mr. Leith brought to the commissioner's attention the changes

in capital costs in the forest industry over the past few years.

The figures I'll cite at this moment relate to new pulp capacity,

which is the most capital-intensive sector of the industry, but they

apply in general format right across the field. These are costs of new

pulp capacity which relate to numbers of dollars per annual ton

required to be invested. In 1971 the total figure was $133.30. By 1976

this figure had gone up to $310.62 — almost a tripling, Mr. Speaker.

If you look at the capital component of that loan the figures went

from $44, roughly, to $118, roughly — once again, almost a tripling.

The distribution of costs for selected periods evidences the increased

size of the capital charges. Back in 1966-67 capital accounted for

about 22 per cent of the annual cost. By 1976-77 it had grown to 40.1

per cent.

If there's been a tremendous thirst for capital in the forest

industry that's one thing. You can get along with that if at the same

time you're getting a good return on that capital. What are the facts

about return on capital? In a talk in early April of this year, Jamie

Angus, who is the Council of Forest Industries economist, brought out

some figures for 1975, the most recent year, and for the decade before

that.

Angus was speaking of the figures for 15 coastal members of the

Council of Forest Industries. The coastal members, I should say, Mr.

Chairman, should be the most profitable group in the industry because

they have the best quality of wood. The rate of return as measured by

this index on capital invested in the industry amounted to only 4.6 per

cent in 1975, and the 10-year average — 1966 to 1975 — was 5.8 per cent

on invested capital.

Some people might say: "Well, that's invested capital — the return

on equity was better." It was only very marginally better. In 1975 the

return on equity was 5.1 per cent; the 10-year average return on equity was

7.6 per cent.

Mr. Chairman, let me be very clear — this is not a problem which I'm

saying is in any way the fault of the minister. I'm saying that it's a

problem that somehow he and his department and his government and this

Legislature have to tackle. Figures like 5 and 6 and 7 per cent return

on invested capital just aren't good enough in this day and age to get

the new kind of investment in this province we need to change forestry

back from being a no-growth industry to a provider of jobs in this

province. We all know that we're a long way from sustained yield in

this province, but we also know that the timber that's maturing every

year and rotting isn't capable of economic harvest, by and large,

because of our cost structure. A large part of that problem is the

return on capital invested in the industry.

Mr. Chairman, people are too prone to look at the profits of the

forest companies and say, "oh, millions of dollars — that's a lot of

money, " but you have to compare that to the amount of money that's

invested in there by shareholders and by bond holders in the first

place. Any time people who are saving in any way — whether they're

saving in their own bank account, whether they're saving through a

pension fund or an insurance company or whatever the means of capital

intermediations may be — have to say the rate of return that they'll

get by going to that particular industry is less than enough to

compensate them for inflation, and is less by a considerable margin

than they can get by going down to a trust company and taking an

ordinary certificate out, then that's not a very good place to put

their money. That bodes very ill for the future of British Columbia, in

my opinion.

The minister has limited manoeuvrability. There's not much he can do

about labour costs, although I think the government as a whole can do

some things about labour costs in terms of improving the industrial

relations climate in this province. I think that one of the most

sensible, practical, down-to-earth unions in this province is IWA; the

pulp unions haven't showed quite that degree of leadership, I think.

But there's not much this minister can do, in any event, about labour

costs.

There's not too much either he can do about capital charges, but

there's a great deal that he can do about wood costs. That comes in two

general areas. One is Crown charges for timber, and the other one that

he can perhaps get at more quickly, and has to some extent already, is

the cost of acquiring that timber in an operational sense — the logging

guidelines, to be specific. The minister has changed those guidelines

to some extent recently. I'd be grateful if he would give some details

to the House on the additional cash flow that he feels that this might

inject into the industry.

I was very concerned to read of some testimony that was given at the

final session of the Pearse royal commission. According to the

newspaper report, and I'll just quote it here:

"No serious attempt was made by the B.C. Forest Service

to assess the cost in lost revenue of enforcing new logging rules on the coast,

though the bill might be as high as $120 million a year, it was revealed in

Vancouver Thursday.

"At the final hearing of the Pearse Royal Commission on

Forest Resources, deputy provincial Forests Minister, John Stokes, admitted

under questioning by Duncan Shaw, acting for M and B, that there had been general

discussion of the cost of guidelines introduced

[ Page 2692 ]

in 1972, but no attempt at serious cost analysis.

"Stokes said that he did not accept the figure of $100 million advanced by Shaw as the true cost of the loss in government

and industry revenues as a consequence of implementation of the

guidelines, but he did not advance a counter-figure as to what the real

cost is."

Mr. Chairman, what I would like to know is: what was the cost of those new

guidelines? Does the department yet have an estimate? And what is the benefit

of the slacking off of the guidelines? How much more possible is that going

to make it for the industry to operate in an efficient way in this province?

Mr. Chairman, make no mistake, the basic concern here isn't about

industry profits. Industry profits are just a means to an end. The

basic concern has to be about the jobs that are generated by industry

in this province, jobs that are generated by new investment in that

industry, which we have just not been seeing for the last few years,

and of course about the taxation revenues that are generated when an

industry is in a profitable position.

It's a thing which is of just enormous concern to me, Mr. Chairman,

and I know that it's of concern to the minister as well. He's only been

in this portfolio for a few months now, but he cannot fail to have

tackled this question and, I would assume, to have discussed it not

only with industry groups but with union groups as well. I know, for

example, that the IWA is very concerned about the underlying economics

of the situation, as they have to be, because they have the highest

wages of forest workers in the world. They want to maintain that, and I

want to maintain it and I think the whole House does. But to do that

the industry simply must be in a more economic position than it is

today.

I would ask the minister if he has any news he can give us, or any

analysis or approaches to the problem that need not await the results

of the Pearse commission, because they're not really along the lines of

tenure questions, they're much more along the lines of financial

questions. I wonder if the minister could tell us his current analysis

of this very, very serious economic question for British Columbia.

[Mr. Veitch in the chair.]

MRS. B.B. WALLACE (Cowichan-Malahat): Mr. Chairman, I

represent the constituency that probably has one of the highest per

capita logging-oriented and forest-oriented industrial areas of any

constituency in the province. As such, I am of course naturally very

concerned about the health of the forest industry within British

Columbia. Not only am I concerned, Mr. Chairman, but I would like to

tell the minister, through you, that the residents of my constituency

are very concerned about the position that the forest industry is

having to face up to in the international marketplace. They're

concerned, Mr. Chairman, about the fact that in this instance, as in so

many other instance with this government, we find one minister charged

with so many responsibilities. We find the minister charged with

responsibility for not only the forest industry but for the mines and

for I don't know how many other things, Mr. Chairman.

I am more than particularly perturbed when I hear that minister, by

his own admission, say that he feels he's qualified as a Minister of

Forests because he has spent a great deal of time in the bush. I would

suggest, Mr. Chairman, that it takes a great deal more qualification

than spending a lot of time in the bush to be able to manage the

complexities of the forest industry in this province in this day and

age, and I am concerned, as are my constituents, about the future of

the forest industry in B.C. under the tutorship of this minister.

He has indicated that as one means to try and bolster the forest

industry he is going to institute a stumpage policy which will do

nothing but create a loss of our overall timber stands by leaving more

unused timber or a lower grade of timber standing in the forests. This

is one thing that disturbs me, Mr. Chairman, as it does disturb the

people in my constituency.

But really, Mr. Chairman, I rose today to speak about another facet

of this minister's activities, and it's a very strange facet that he

has to be concerned with. That has already been raised by the member

for Shuswap (Mr. Bawtree) — the matter of rangeland management. We, of

course, have embarked into an area of multiple use for rangeland, and I

certainly agree in principle to a degree with that approach.

I asked the minister the other day about whether or not he had

undertaken any major changes in rangeland management, and he replied to

the effect that there were no major changes in effect. I'd like to just

speak specifically at this point about one specific range, Mr.

Chairman, and that is the Fly Creek range.

Now in that area there is one medium-sized rancher; he does some

logging and he's also a cattleman, and he's had his ranch there since

1958. He's a good citizen of that area, Mr. Chairman. He puts up hay —

even more hay than he can use for his present herd. He has a permit for

86 head on the Fly Creek range. He applied this year to have his permit

doubled. This was refused and he was forced to sell some 80 head of his

herd.

Now, Mr. Chairman, I understand that on this same range there is a

large ranch in that area, the X Bar H. Now that X Bar H does not fall

really into the category of the small local farmer. It's a corporate

industry that comes in, it ships cattle in, it puts them on the range,

it takes them out. It contributes nothing to the economy of the area,

yet the X Bar H has been given permits which considerably increase

[ Page 2693 ]

the number of cattle they are allowed to graze. I would suggest, Mr.

Chairman, that this does represent a change of policy, and I'm very

concerned about this X Bar H ranch being given this kind of increased

permit to range.

They put up no hay; they buy no machinery or supplies. They

contribute nothing to the community, and yet they are being allowed to

use government land to benefit their enterprise and the person who has

been in there as a small rancher and contributing to the community has

been allowed no increase.

Now I understand that the G Triangle, a small ranch, was offered the

right to put some cattle onto a new part of the range which had been

fenced off but he was told that he could only keep them there until

April 1. He felt that there was no point in putting cattle on there

until April I because then he would have no place to put them, so he

couldn't increase his stock for that kind of an arrangement. Yet, Mr.

Chairman, the X Bar H did put cattle in there and had them on well

after April 1. In fact, the last word I had, which was sometime in May,

the cattle were still on that new part of the range, put there by the X

Bar H — the large group of corporate people who were in there to make

nothing but money off that land and return nothing to the community.

I suggest to you, Mr. Chairman, that that does represent a change of

policy, and it's a change of policy that I am certainly not in accord

with, the farmers and the ranchers of this province are not in accord

with, and it's a change of policy that is contrary to the concepts that

have been established over the last few years.

The member for Shuswap (Mr. Bawtree) mentioned the McLean report,

and I would refer that as good reading material to the Minister of

Forests. I know he's a very busy man, but I think that if he is charged

with the responsibility of handling such things as grazing land for

ranchers and farmers in this province, then he is duty-bound to be

aware of what's going on and to be a responsible minister and take a

responsible view towards the usage of this rangeland for the purpose

which will return the most benefit to the community specifically and to

the economy of the province as a whole.

MR. SKELLY: There is just one last question I'd like to ask

of the minister before he gets up, and spends two or three hours

answering all the questions we've asked of him before. This relates to

the highlights of a staff meeting held June 14,1976, among Forest

Service staff. A report from the engineering division — part of this

report — says: "The summer work programme for the management

engineering

section has begun. The initial McGregor diversion project

has been completed and work has been lined up for other projects in the

Prince George area." I'm wondering just what the nature of the McGregor

diversion project is that the Forest Service is working on

through their engineering division. Are they doing work for B.C. Hydro

which will result in the creation of the McGregor diversion? This is

the diverting of water from the Fraser River system into the Peace

River drainage which has been called by some people "an ecological

time-bomb" that threatens to bring parasites from the Peace River

drainage into the Fraser River system that threatens one of the major

industries in this province — the fishing industry on the B.C. coast —

and which could be as dangerous as the St. Lawrence Seaway construction

which brought the sea lamprey into the Great Lakes and completely wiped

out the Great Lakes fishery for years and years.

I am wondering just what the nature of the work is that's being done

by the Forest Service for B.C. Hydro on the McGregor diversion system.

Are you doing the preparatory work for B.C. Hydro to create the

McGregor diversion which will take water from the Fraser system through

the W.A.C. Bennett Dam and release this ecological time-bomb on the

Pacific coast fisheries?

MR. CHAIRMAN: The Minister of Mines and Petroleum Resources.

HON. MR. WATERLAND: And Forests.

MR. CHAIRMAN: And Forests et al.

HON. MR. WATERLAND: Thank you, Mr. Chairman. It pays to advertise, doesn't it?

MR. CHAIRMAN: Sometimes.

HON, MR. WATERLAND: Mr. Chairman, first of all in response to

the latest remarks from the member for Alberni (Mr. Skelly) the only

work that the Forest Service would be doing in the area of the McGregor

diversion would be in assessing timber values. We are not doing any

work specifically for B.C. Hydro. Please, I don't think that the Forest

Service has any responsibility towards bringing all kinds of scary

monsters out of the north into that river system.

MR. SKELLY: You're just preparing for it.

HON. MR. WATERLAND: Yes, we're just preparing for it.

As for the member for Cowichan-Malahat (Mrs. Wallace), let me assure

you that there have been no policy changes in the management of

rangeland. I deal almost daily with individual problems that individual

ranchers have. I would only ask that if members of your constituency do

have problems relating to grazing that you please bring them to my

[ Page 2694 ]

office yourself and I will be more than happy to try to resolve the

problem if it possibly can be. I don't want to have the members in the

opposition feel that because they happen to be in the opposition they

don't have access to this minister's office. I am here to serve all the

people insofar as my portfolio is concerned. So do bring the problems.

Don't let them get out of hand. We can oftentimes nip these things in

the bud. They are much less of a problem to resolve if attacked early.

That member, as did one of the other members — the member for

Alberni (Mr. Skelly) — is wondering about my qualifications to be

Minister of Forests. I said I was raised in the bush and I was. I'm

quite proud of the fact that I was raised in wilderness areas of

British Columbia, in the bush where the trees are. That in itself does

not qualify me for being the Minister of Forests.

Interjections.

HON. MR. WATERLAND: I have been involved in resource

industries in this province all of my working life and indeed for my

entire life. There are quite a few similarities really in the basic

natures of our two main resource industries, mining and forestry. There

really are a lot of parallels that can be drawn. I believe my

qualifications as Minister of Forests are probably far superior to

those of the member raised in Vancouver East who was a town planner.

SOME HON. MEMBERS: Oh, oh!

HON. MR. WATERLAND: Again, the member for Cowichan-Malahat

(Mrs. Wallace) remarked as to what new directions are being taken in

range management. I said that so far no new moves have been made.

However, the previous government had hired Mr. Bill Anderson to study

integrated resource use of rangeland and other basic resource uses of

the land. This study is proceeding. Some initial moves into this area

have been made in the Kamloops, Nelson and Williams Lake areas. By the

way, we will shortly be appointing a new director of grazing. Because

of the importance of grazing, this position will be raised to that

equal to a department head in the Forest Service.

The member for North Vancouver-Capilano (Mr. Gibson) brought up the

problems of the economics of the forest industry. The member for

Shuswap (Mr. Bawtree) quoted you some figures. I'll go over those

figures again. The easiest ones to go through are the coast, because we

have a much simpler appraisal system there. We don't have to go through

the manufacturing on the end-value system. But he said that on the

coast in 1973 the average value received for timber was $65 per cunit.

That figure estimated this year is about the same. At that time the

Forest Service had a cost allowance in their appraisal system of $32; the

logging cost at that time was $32 a cunit. That logging cost today has

gone up to $62. So all we have is a spread of $3 between what the

material is worth on the market and what it costs to produce it. That

$3 must provide a return to the province in the way of stumpage and

other direct charges to the forestry companies and it must also provide

a profit for the people in the industry who have committed their

capital in expectations of a return. There just isn't enough money

there to provide both of these.

That represents a 94 per cent escalation in costs over that

three-year period. Now that cost — I'm not going to try to pin the

blame for that on the previous government or on anyone else. There has

been general inflation in the world and in British Columbia in

particular, and in particular in the forest industry it has hit us

very, very hard. But this industry is indeed in serious trouble. If we

try to fool ourselves into thinking that anyone — Peter Pearse or

anyone else — is going to come up with an instant solution to solve the

problems of this industry, we are fooling ourselves.

That member also said that the loggers — the IWA in British Columbia

— are the highest-paid loggers in the world. That may be true, but they

are still not getting as much as the people working in the supermarkets

and people working in the government. That, somehow, to me doesn't seem

right. I haven't worked in a logging operation but I have in my youth

spent a lot of time clearing right-of-way for roads. I know what type

of work these guys have to do. I didn't have a powersaw in those days;

I was on a string-board with a crosscut saw. A power saw helps

somewhat. But there is tremendous physical exertion required in logging.

It's a tough way to make a living, and these people deserve a better

return than people working in supermarkets and retail stores — and for

the government, for that matter. But where is it going to come from?

There's three bucks left there, in the coast — there's no more pie to

split up. So you tell me what's going to happen. I really don't know.

If you look at the cost of wages in British Columbia over the last few

years in the Forest Service, they have gone up remarkably; they have

stayed ahead of the rest of the forest industry in North America.

However, the productivity has gone down by about 30 per cent. The

higher wages, the lower productivity, when related to the cost per

cunit of wood, has a terrible effect.

Interjection.

HON. MR. WATERLAND: That is productivity — man-hours per

cunit of wood produced. In 1971 it was at a figure of 2.1 man-hours per

cunit; it is now 2.8 man-hours per cunit — about a 25 to 30 per cent

[ Page 2695 ]

increase. Why? I don't know, but it has to change. The people who

are employed in the forest industry, I am sure — as that member said —

are aware of the fact that their industry must be competitive and they

must be more productive, because the only way they can possibly get any

more wages out of that industry is by increasing productivity.

In that $2 spread the government must take its revenue. In the same

period of time, from 1973 until this year, the direct stumpage revenue

taken by the government from this industry has gone from $248 million

in 1973 to $35 million direct revenues from stumpage last year. So

there's nothing left there. Now we're talking about a $2 billion

industry, and a direct revenue from stumpage of $35 million. We cannot

increase that because it just is not there, so we really do have

serious problems. I don't have instant answers. Perhaps our member for

Kootenay (Mr. Haddad) who is a magician, could come up with something —

it's going to require something like that.

The government does have things that can be done. The environmental

constraints, the logging guidelines that were imposed, did have a

tremendous effect on the cost of logging. I can't give you figures on

that, but this is one of the areas that can be worked on. We must have

more realistic approaches to the standard of roads, for example,

because those roads must be paid for by that resource. If there's no

more money there, the first thing that should go is the standard of the

roads, because all the logging people really need from their road is a

pathway to get their timber out of the bush. Now if it is required that

there be a better-class highway in there, then that forest industry

cannot afford to pay for that; that revenue must come from other

sources because it's just not in that forestry sector. It's not, and

anybody who says it is is fooling themselves.

We had to hold back somewhat on the standard of utilization on the

coast — and this is only being done through permit application by any

individual company; it's not a blanket thing. We're saying to the

companies that until the end of this year only we will allow you to

leave slightly larger pieces of junk in the bush because when you bring

it out you can't sell it anyway and it winds up as part of our debris

problem in the coastal waters.

Now that will somewhat change revenue to the government because the

average market value of material brought out will now be slightly

higher, which in turn will be reflected in slightly higher stumpage

return to the province. But that is only a temporary thing, and one of

the reasons that that came about was because we have a terrible excess

of pulp logs on the coast and wood chips in the interior. This stuff,

if it's going to be taken out, is just taking if from one place where

it's of no value and putting it somewhere else where it's of no value.

I'm afraid that if costs continue to escalate in this business,

someday in the not-too-distant future only the very, very best quality

wood in this province will be economic. That other wood — the

fantastically good utilization standard that we have gotten down to

over the last 20-some years — will be meaningless, because if you can't

sell the stuff for more than it costs to produce it, it has to stay in

the bush.

AN HON. MEMBER: And that means fewer jobs.

HON. MR. WATERLAND: That means many, many fewer jobs. The

forest industry is a half of our economy, and it's in trouble. I think

everybody, whether we be opposition members or government members, must

recognize that fact, and we must all collectively work towards a

solution to that, because if we don't come up with a solution, believe

me, we will be in trouble.

The second member for Victoria (Mr. Barber) saw a monster in Beacon

Hill Park. Ooooh! (Laughter.) I wonder what it was doing there? I must

tell you something, Mr. Member, about Beacon Hill Park, and this is

going to shock you — it's going to shock the whole opposition — and my

members, too, I believe. On the 26th of this month we will be having a

mining operation underway in Beacon Hill Park...

Interjections.

HON. MR. WATERLAND: ...and I invite you all. On the 26th it's

the Canadian annual mine rescue competition. It's a mock mine; it won't

destroy the park — but I would like to see you all there. I realize

this is forest estimates, but I thought, what a lovely time to tell you

about mining in Beacon Hill Park.

MR. N. LEVI (Vancouver-Burrard): What are you going to do if you find something in the park? (Laughter.)

HON. MR. WATERLAND: Then we have a problem. (Laughter.)

The Burns Lake Development Corp., I must agree, is a good thing. It

is providing our native people in that area with a chance of being

productive, of working the same as everyone else does in a competitive

industry. And they are doing a good job.

There are better operations. These people are learning fast. They

are good workers and very competent people. We have similar proposals

coming forth from other Indian bands. There is one, the Kitwanga band,

which recently had entered a bid proposal for a quota of timber. There

were two bids put in for that, and when the bids came in it appeared

that the Kitwanga band were not going to be awarded it, because we want

these people to compete on a competitive basis with no favours and that

is the way they want it. They don't want to have stuff handed

[ Page 2696 ]

to them. They've told me. Mr. Brown, the president of the Burns Lake

Development Corp., and Ken Spinks from the Lytton band, come in and

say: "Look, all we want is a chance to bid on that, the same as

everybody else, and if we're not competitive we don't want it. But if

we are, we want to have a chance, the same as everybody else in this

province." I think that is a beautiful attitude and I will do

everything I can to encourage the native people to do just that.

As a matter of fact, when the people from the Burns Lake Development

Corp. came down they didn't get a particular forester's sale. However,

while they were there I suggested that we get staff from the Department

of Mines together with them and give some of their band prospecting

courses so that they can go out and also become involved in the mining

industry. They are doing this right now.

I think it is a good thing to encourage all our native people to

become involved on an equal basis with us and let's not separate them

from us. Let's just work together without any preference. As a matter

of fact, as the Minister of Forests, there is no way, other than

writing in very strict sociological advantages, that I can direct

forest value to the native people. But they don't want it directed.

They just want to have a fighting chance with everyone else, and I

think that's a beautiful attitude.

MR. G.V. LAUK (Vancouver Centre): Williston!

HON. MR. WATERLAND: Ray Williston — who's that?

The Premier has announced — he and I have been together before he

went away — and we have decided that my responsibility for the

forestry-based Crown corporations puts me at less than arm's length

distance from these corporations. I am the minister responsible for the

disposing of values in the forest sector. I should not also then be the

minister responsible for these Crown corporations which are acquiring

forest value. So the responsibility for these Crown corporations will

be taken out of my hands and an announcement probably will be made by

whoever assumes that responsibility as to the replacement for Ray

Jones who resigned recently.

By the way, I must publicly thank Ray. He did a good job with that

corporation. He's a very dedicated man and he will stand on, for a time

at least, as a director of the Crown corporations and he will be

available on a consulting basis for whoever replaces him. But Ray Jones

is a very good person and I do appreciate the devotion which he gave to

that corporation.

MR. LAUK: Who is the responsible minister?

HON. MR. WATERLAND: That announcement as to the responsible

minister and replacement for Mr. Jones will probably be made later this

week or early next week.

MR. LAUK: But you're still responsible. Can you answer the question?

HON. MR. WATERLAND: No, the appointment will be made by the minister who assumes this. This person will not be working with me.

Interjection.

HON. MR. WATERLAND: Not really.

MR. CHAIRMAN: Order, please.

HON. MR. WATERLAND: The member for Alberni (Mr. Skelly) was

talking about the drop in the number of independent sawmilling

operations in British Columbia, Yes, that's quite true what he said,

that in 1952 we had some 2,500. He called them independent

family-operated mills. I think they are more commonly referred to as

bush mills, and there is no way that this type of mill, under today's

environmental constraints, would be permitted to operate.

MR. CHAIRMAN: Hon. Minister, would you defer for a moment to the House Leader?

HON. MR. WATERLAND: By all means.

HON. MRS. McCARTHY: Mr. Chairman, I wonder if I could just

establish that when the minister has completed his statement we move

into the estimates of the Department of Mines. Thank you very much.

MR. CHAIRMAN: Thank you. The hon. Minister of Forests.

HON. MR. WATERLAND: Yes, as I was saying, these 2,500

independent sawmills were what was commonly known as bush mills, and

under today's environmental restraints there is no possible way that

these mills could exist. They wouldn't be allowed to exist. They

couldn't exist economically. There are still a number of small

independent sawmills around, and everything that I can possibly do I

will do to ensure their continuing viability. I have said many times

that I believe in the independent operator, the small operator, and I

do. But so many of these small operators have a habit of becoming

successful and then they become big operators. So this is one of the

reasons why the smaller ones have disappeared. More power to them.

There's nothing wrong with being successful and growing.

That member also mentioned that in 1952, 62

[ Page 2697 ]

cents of every dollar came from the forest industry. Now because it

is 50 cents doesn't mean that the forest industry has not continued to

thrive and prosper. I think our whole economy has broadened and that 62

per cent figure is now 50. But it is just because we have had quite an

expansion in other industries such as mining, agriculture and tourism.

The member for Columbia River (Mr. Chabot) is very concerned about

park creation, as I am. In the southern half of British Columbia the

timber supply is totally committed. There is no more wood available.

The wood that is committed is committed to people who are operating

sawmills, pulp mills, whatever, and every time you take a piece of

quota away from these people, you are eliminating jobs. I think we must

respect the parks which we now have.

I really think we must be very, very cautious of single-use

alienation of land. If we want to have special recreational facilities

or usage of areas, this type of thing can be done jointly in a

multi-use concept with proper management of our forest resource. This

is not an unusual thing; it happens in all parts of the world, and the

two can be compatible. I personally don't think that we can afford to

alienate to single use much more of our province.

We have quite a substantial amount of parkland and a tremendous

amount of wilderness in British Columbia, a tremendous amount of bush,

and I know because I was raised there. Let's be very careful about

isolating pieces of British Columbia which have the potential for

creating wealth, employment and productivity for this province. Let's

be careful about tying it up, because as that population is expanding

we need more jobs; we need more development for the people. Let's look

after what we have and be very careful, very thoughtful, before we tie

up too much more land for single use.

I discussed the forest development roads; the British Columbia

Forest Service will maintain roads into communities. The primary

responsibility for the maintenance of logging roads is with the logging

operators; if, however, they are shut down for their logging season in

a particular area, we will provide maintenance as best we can. We will

be receiving, hopefully, some funding from the Minister of Highways'

(Hon. Mr. Fraser'

s) department for that, but we are concerned about the

people in these remote areas. Once again, I'm very sympathetic towards

them because most of the places I was raised in never did have roads.

We had to go in by fishboat or...not dog team, but pretty funny ways of

transportation at times.

AN HON. MEMBER: Burro. (Laughter.)

HON. MR. WATERLAND: The member for Revelstoke-Slocan (Mr.

King) was mentioning the first time we had a run at my estimates. I

forget what happened then, but it didn't turn out to be too successful.

He was talking about the advantages that the forestry-based companies

in British Columbia have over those in the United States, and most of

the things he said were really not correct. In fact, they were

absolutely wrong. (Laughter.)

I have some notes here on it. First of all....

Interjection.

HON. MR. WATERLAND: No, I think he's just misinformed. I

don't think that member would deliberately mislead us. He said that

British Columbia is closer to markets with their forest products, and

that is simply not a fact. British Columbia is the most distant from

the market of any major producing area in the world, This is a fact.

Interjection.

HON. MR. WATERLAND: You don't want to hear the answers to the questions you asked?

There is one remark that the member for Revelstoke-Slocan made which

I would like to touch on because I think it's very important. He was

suggesting cures for the forest industry. One thing he said is that the

workers in the forest industry must be aware of the data base to be

aware of what is happening in that industry. I think that's a good

thing.

We have an example right now, Kootenay Forest Products, where we do

have worker-directors, and those men are very aware of the costs of

operating that company. However, it is strange that the greatest

resistance for the installation of worker-directors at that operation

came from the union. The union did not want to have their men involved

that closely with the company. I think they were aware of the fact that

if they became too aware of just how tight this cost-price squeeze was,

they may, instead of asking for, as the member for Revelstoke-Slocan

said, a 28 or 26 per cent increase, they may realize that they must

take a 10 or 15 per cent cut.

I'm not suggesting that a cut be taken at all, but if the members

realize just how close that cost-price squeeze is, I'm sure they're

going to have to be much less demanding in wages, because this is one

of the areas where we're pricing ourselves out of the market.

I think that covers most of the questions that were raised in the

forestry part of my estimates, and I would be pleased now to go into

mining.

MR. LAUK: Well, I just rustled myself out of that doze I was

in. Mr. Chairman, I am disappointed that the minister is passing the

buck on the Ray Williston issue. I don't know whether he's going to be

appointed the head of B.C. Cellulose or a mining company or whatever,

but it's dodging the issue and

[ Page 2698 ]

it's dodging the minister's responsibility; he has not given an

answer. He's being less than straightforward w