2010 Legislative Session: Second Session, 39th 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)

Monday, April 19, 2010

Afternoon Sitting

Volume 14, Number 7

CONTENTS

Page

Routine Business

Introductions by Members

Statements (Standing Order 25B)

National Volunteer Week and volunteers in Kelowna

N. Letnick

Prevention of violence against women

M. Mungall

Arts and culture in Surrey

S. Cadieux

Farmers markets

D. Routley

Junior B hockey championships in Kamloops

T. Lake

Contributions of volunteers

N. Simons

Oral Questions

School district costs and funding

C. James

Hon. M. MacDiarmid

Central Okanagan school district costs and funding

R. Austin

Hon. M. MacDiarmid

Special adviser to Vancouver school district

S. Simpson

Hon. M. MacDiarmid

Government mailout information on harmonized sales tax

B. Ralston

Hon. C. Hansen

M. Farnworth

First Nations consultation on harmonized sales tax

D. Donaldson

Hon. C. Hansen

Government air travel for Site C power project announcement

J. Horgan

Hon. B. Penner

Petitions

M. Sather

J. Thornthwaite

Orders of the Day

Second Reading of Bills

Bill 9 — Consumption Tax Rebate and Transition Act (continued)

Hon. M. MacDiarmid

S. Simpson

Hon.

M. Coell

Hammell

Cantelon

James

Hon.

B Stewart

Farnworth

On the amendment

M. Farnworth

J. Slater

Proceedings in the Douglas Fir Room

Committee of Supply

Estimates: Ministry of Healthy Living and Sport

Hon. I. Chong

J. Brar

K. Corrigan

Hon. M. McNeil

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MONDAY, APRIL 19, 2010

The House met at 1:34 p.m.

[Mr. Speaker in the chair.]

Routine Business

Introductions by Members

N. Macdonald: On Sunday afternoon the Revelstoke Grizzlies Junior B hockey team added the western Canadian championship title to their Cyclone Taylor Cup championship. I ask the House to join me in extending congratulations to Revelstoke and the Grizzlies for their Keystone Cup win.

E. Foster: In the precinct today we have, representing the city of Vernon — their ambassador of excellence program — committee members Karen Humphrey and Coleen Noel and ambassadors Amy Serano, Tamsen Guidi and Brittany Weatherill. I'd ask the House to please make them welcome.

B. Routley: I have a large and delightful group here with the Arbutus Travel Club from the Cowichan Valley. They've toured the Legislature today, and we had a nice lunch together. It was organized by Corry Salmen. Please join me in making them feel welcome.

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G. Gentner: In the gallery are friends of mine, John and Janet Doutaz. John, of course, worked many years in the Legislature. He did a lot of maintenance work and replastering the walls for us, and that's why it's still here today.

Also joining us in the Legislature are Ben and Judy Alcock from Powell River. Could the Legislature please make them welcome.

Hon. B. Bennett: Today, once again, we're honoured to have the mayor of Quesnel, Mary Sjostrom, with us in the gallery up here. Also with Mary is Coun. Barb Steele from the great city of Surrey. Please help me make them feel welcome.

A. Dix: I'd like to welcome in the galleries today Larissa Duff-Grant, a grade 10 student from Windermere Secondary in my constituency of Vancouver-Kingsway. She's joined her by her mom, Jennifer Gray-Grant. I hope everyone will bid them welcome.

J. Horgan: Joining us in the gallery today is a graduate from the University of Victoria in biology, Tess Grainger. Tess has just returned from travelling in Africa, and she plans to begin her master's degree at the University of Victoria in the fall. Would the House please make her very, very welcome.

D. Hayer: I would also like to add my welcome to Barbara Steele, our city councillor — one of the hardest-working councillors in the city of Surrey — who is my constituent. Would the House please make her very, very welcome for doing a great job in Surrey.

S. Chandra Herbert: On behalf of the official opposition, I want to congratulate all the artists and arts supporters in B.C. This week, of course, is Arts and Culture Week in B.C. We will continue our call for strong investments in arts and culture. Thank you to everybody who brings culture into our homes and our communities all across this great province.

Hon. C. Hansen: On behalf of the Premier, I would like to welcome a group of 46 students from University Hill Secondary School and their teacher, Mr. John Yetman, and four parents who have accompanied them to visit the Legislature today. I hope we'll make them welcome.

Statements

(Standing Order 25B)

NATIONAL VOLUNTEER WEEK

AND VOLUNTEERS IN KELOWNA

N. Letnick: "He shoots; he scores," were the last words we heard from the gold-medal hockey game where Crosby shot. And do you know what? None of that would have happened without volunteers during the Olympic Games. This week is National Volunteer Week. From April 19 to 25 all across the country we will celebrate the work of hundreds of thousands of volunteers.

Every community in this country owes a debt of gratitude to its volunteers. Last week in Kelowna we recognized some of our dedicated volunteers at the 35th Annual Civic and Community Awards. The finalists, who were nominated by Kelowna citizens, were recognized for their outstanding achievements and contributions to our community in 2009. Here are just some of those that I'd like to congratulate on the record.

The woman of the year is Mohini Singh; the man of the year, Vern Nielsen; Teen Honour in the Arts, Hayley Blais; Honour in the Arts, Randy Leslie; the Augie Ciancone Memorial award, Sydney Mullen and Connor Clerke; young female and male citizens of the year, Jessica LeNoble and Cody O'Neil; the Bob Giordano Memorial award, Arnar Bernhardsson.

Female and male athletes of the year, Samantha Richdale and Dan Brown; Bryan Couling Memorial award, UBC Okanagan women's Heat volleyball team; Central Okanagan Foundation Volunteer Organization

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of the Year, Rotary clubs of Kelowna; corporate community award winner, MacKay LLP Chartered Accountants. The Anita Tozer Memorial Award went to Herb Sullivan.

This year there's a new category, the Heroes Award, which was awarded to Ty Lockerby and Matt Jackson. They were recognized for their courage in saving four Calgary residents from a vehicle submerged in the lake at Three Valley Gap on June 29, 2009.

Thank you to all the wonderful volunteers throughout the province, throughout my community and throughout our country. We would not have the same place, the same enthusiasm or the same services without their selfless, enthusiastic support. I would like the House to join me — I'm not sure if it's appropriate in a two-minute statement — in congratulating all the volunteers throughout our province.

[1340]

PREVENTION OF

VIOLENCE AGAINST WOMEN

M. Mungall: Unfortunately, violence against women is all too common. Whether in Afghanistan or Anahim Lake, whether in Vietnam or Vancouver, you can find a woman who has sought the supports needed to survive violence and prevent it further. In fact, you will likely find more than one woman in this situation in any community, in any country, on any continent. That is what makes this week so important.

The Prevention of Violence Against Women Week started yesterday, on April 18, and wraps up on April 24. Initiated in 1995 by the previous government, B.C. continues to recognize this week as a way to raise awareness and identify methods for preventing the violence that is so hurtful and often deadly.

During this week community groups throughout the province are holding workshops and information booths, distributing leaflets and posters, writing media columns and blogs and, of course, starting Facebook groups and Twitter threads. The Nelson Community Services Centre is hosting a community arts project called Voices in the Wind, where a clothesline of T-shirts tells the stories of women and children who have survived abuse.

By increasing awareness, by starting the conversation, we take a vital step in preventing violence against women, but we must take further steps to make violence against women a thing of the past to truly prevent it. We must teach ourselves and our children that violence is not a display of love, that it is not the way to solve problems and that it is not acceptable.

Wearing a white ribbon, donating to a local transition house and participating in a march are all ways we do this, but most importantly, we change the world when we treat each other as equals. By doing that, we can prevent violence against women.

ARTS AND CULTURE IN SURREY

S. Cadieux: This week marks the 11th annual B.C. Arts and Culture Week. This is a great opportunity to commemorate and to raise awareness about the valuable contribution that the arts have in our communities.

I'm really lucky in Surrey-Panorama that many talented artists and organizations have made their home in my riding and also in the greater Surrey area. The award-winning Surrey Art Gallery has long been a proud part of our community, stimulating dialogue and exposing visitors to new ideas and viewpoints through contemporary art.

The Crescent Beach photo club is currently showing their Lightscapes exhibit at the Surrey Art Gallery. From now until June you can enjoy the work of these gifted photographers as they highlight the beauty of our local area.

Whether you go to an exhibit or join a club, there are many ways to enjoy the arts. Schools are a great first place to ignite interest. Coming up this Friday I'll have the pleasure of attending the Earl Marriott Secondary School's live production of Beauty and the Beast . The demand is so high, in fact, that this is the first time the school has had to add a matinee showing.

Their theatre department has also enjoyed success thanks to the dedication and passion of Earl Marriot's theatre students, teachers and a large group of volunteers, including Surrey-Panorama resident Linda Weston. A true patron of the arts, Linda has dedicated hundreds of hours to the costume design of almost every school production. She selflessly continues to dedicate her time year after year to the success of each of these productions with absolutely fabulous costumes.

I encourage everyone to get to know their arts community better during this Arts and Culture Week and in the future.

FARMERS MARKETS

D. Routley: I'd like to talk to the House today about farmers markets. Farmers markets are in existence in every corner of our province. They reflect the communities they serve. Like those communities, they vary in size, type and character. The vendors, to be members of the B.C. farmers market association, must make, bake or grow their own products. In our little corner of B.C. — in Cedar, B.C. — we enjoy the Cedar Farmers Market thanks to the energy of organizers George and Betty Benson.

On Vancouver Island only 30 years ago we produced over 80 percent of the perishable foods consumed on the Island. Today that's less than 5 percent. Food security is an essential element of an independent and autonomous community. We need to support our farmers and support our producers. Marketing and processing links that farmers depend on are supported by healthy farmers markets.

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Also, arts and culture are promoted, as artists and cultural events promote themselves through our farmers markets. These are essential community links, and we need to support them. So I'd encourage all the members and all the people of the province to get out and support your local farmers market. In Cedar you can join us at 2313 Yellow Point Road from May 9 to October 31. Let's support our agriculture industry and make our communities secure.

JUNIOR B HOCKEY

CHAMPIONSHIPS IN KAMLOOPS

T. Lake: As mentioned by the member for Columbia River–Revelstoke, this past weekend Canada's tournament capital hosted the western Canadian Junior B hockey championships. The Keystone Cup took place at the McArthur Island Sports and Event Centre in north Kamloops. Each year since 1983 the top Junior B teams from across Alberta, British Columbia, Saskatchewan, Manitoba and northwestern Ontario fight a tough battle to determine the best in the west.

The Revelstoke Grizzlies were the best team from our province, and the Kamloops Storm represented the host city. Neither team disappointed. British Columbia won its second straight and seventh-ever Keystone Cup, with the Revelstoke Grizzlies beating Saskatchewan's Tri-Town Thunder 5 to 3 in the final yesterday.

The hometown favourites, the Kamloops Storm, definitely gave their audience a show. They beat the Beaumont Chiefs of Alberta in a nail-biting 4-3 win in double overtime to take the bronze medal, after tying the game with just one second left in the third period.

This is a tough bunch of 16- to 20-year-old hockey players. Their hard work and talent were evident on the ice, and they represented their provinces with pride on and off the ice.

As always, the people of Kamloops were more than ready to welcome these athletes into their community, once again living up to our well-earned name as Canada's tournament capital.

We all witnessed hockey unite Canadians of all ages and all stripes at the Vancouver 2010 Olympic Games, and Junior B hockey unites people in smaller communities to support their young athletes. It's important that we also support their pursuit of excellence on the ice.

Congratulations to the Revelstoke Grizzlies and the Kamloops Storm, to all the participants, their coaches and families, and to the great city of Kamloops for hosting yet another successful tournament.

CONTRIBUTIONS OF VOLUNTEERS

N. Simons: Today marks the beginning of National Volunteer Week, so I've written a poem.

When the Legion hosts a Remembrance Day

or Rotarians and Lions build parks to play,

none of them asking for money or pay,

let's thank the volunteer.

When money is raised to save a cat,

and plays are put on by passing the hat,

when festivals bring us writers and singers,

let's thank a volunteer.

When the theatre's sets were better than ever,

when birds that were counted were birds of a feather,

and when Environment Canada gets reports on our weather,

let's thank a volunteer.

When a senior gets out for a meal with her friends

or when salmon get hatched in their hatchery pens,

when the team finds a coach or a choir finds a tenor,

let's thank a volunteer.

When a fire breaks out far away from a town

or a boat off the coast might be about to go down,

when a stream gets attention or an actor a gown,

let's thank a volunteer.

They're in our schools and on boards and on many

committees.

They're in our hospitals as well as our health care auxiliaries.

They do more work in a day than most birds and most bees.

Let's thank a volunteer.

In closing, thanks, Mr. Speaker. I've now had my say

to celebrate all volunteers on this day,

and it's probably time we get on with this play.

Let's thank our volunteers.

Oral Questions

SCHOOL DISTRICT COSTS AND FUNDING

C. James: Hundreds of parents, teachers and students gathered in Vancouver to call on the B.C. Liberals to stop the neglect of our public education system. Hundreds more are rallying today. Here's what a student had to say at that rally: "All our textbooks are old. We have ripped pages that you have to tape." A parent said: "Two more years of this government will be the end of public education."

The minister was invited, but she failed to attend. So my question is to the Minister of Education. Why is she refusing to listen to parents, students and teachers? Why won't she get on with fixing the mess in the education system created by the B.C. Liberals?

[1350]

Hon. M. MacDiarmid: Let's be clear. We are investing $4.6 billion in this education system this year in British Columbia. We've increased education funding every year for the last ten years. In fact, as the members opposite are well aware, the last time that the Vancouver school board's budget was reduced was when they were in power, in 1998.

Mr. Speaker: The Leader of the Opposition has a supplemental.

[ Page 4462 ]

C. James: For years and years the B.C. Liberals have denied having had a role in the education crisis that we see, and now the minister wants families to believe that it's someone else's fault, that it's the school board's fault. Well, people aren't buying it. Parents and students aren't buying the line. They know the B.C. Liberals have neglected education in our province.

This situation is not unique to the Vancouver school district. Here are shortfalls facing other school districts: Coquitlam, $4.1 million; Richmond, $6 million; Nanaimo, $2.8 million. These are all shortfalls: Central Okanagan, $4.6 million; Kamloops, a $2.4 million shortfall.

Again, my question is to the minister. The B.C. Liberal neglect isn't hurting just one school district. When will this minister stand up and admit that this crisis is in every region in British Columbia?

Hon. M. MacDiarmid: Well, I remind the member opposite of what the former NDP Education and Finance Minister, Paul Ramsey, said just a few days ago. "The shortfall is a fiction on paper. It's not a real deficit. It's a wonderful game that school districts use to jam Ministers of Education."

At a time when we're facing one of the worst economic downturns in decades, Mr. Speaker, we have chosen to increase education funding for a tenth year in a row. We have funding for a teacher salary increase, $54 million, and $58 million for full-day kindergarten — a program which the members opposite have not been supportive of but which we know will make a profound difference for the young learners in our province. Increased investment at a time when the economy has taken a downturn — we believe in education. We believe in the future of these students.

Mr. Speaker: The Leader of the Opposition has a further supplemental.

C. James: I can tell the minister what she and this government are doing. They're downloading costs onto school boards, they're blaming the boards, and students are losing out in British Columbia. That's what this government is doing.

Let's take a look at the numbers the minister didn't share with us, Mr. Speaker: $66 million of unfunded costs for salaries and pensions, $2.8 million for higher medical premiums, $6.3 million for carbon offsets for schools, $2.4 million for higher B.C. Hydro rates — none of that provided by government. Every single district in this province has been hit with higher costs while they struggle with huge funding gaps.

Again, my question is to the Minister of Education. Students are the future of our province. When will this minister admit that they've been downloading costs onto school boards, and when will this minister and this government provide a solution for school districts and communities across British Columbia?

Hon. M. MacDiarmid: Well, we have made it very clear that education is a top priority for this government. That's why we are investing over $4.6 billion in schools around this province this year.

Let's also be clear: this is a government that, like other governments across Canada, faces an extraordinary time economically. We have a $1.7 billion deficit in this province. We do believe in a school system that by this fall…

Interjections.

Mr. Speaker: Members.

Hon. M. MacDiarmid: …will have an estimated 60,000 fewer students than it did last fall. We do believe it's a time for us to look at doing things differently.

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School boards are having these conversations in some cases, talking about sharing services, talking about making changes that will not impact students in the classroom. We need to talk more about this in a system that has been having increasing funding every single year for the last ten.

CENTRAL OKANAGAN SCHOOL DISTRICT

COSTS AND FUNDING

R. Austin: This is what Moyra Baxter, a trustee with the Central Okanagan district, said about this government's decision to appoint a special adviser in Vancouver. "I haven't heard any single school board or school district say that they aren't facing severe financial problems."

My question is to the Minister of Education. Why won't the minister admit that it's the massive shortfalls and millions of dollars in downloaded costs that have caused this crisis across British Columbia?

Hon. M. MacDiarmid: I'll remind the member opposite of what he said just a few short days ago, on March 17. "We have one of the best public education systems probably in the world." That's what we agree upon — one of the best systems in the world…

Interjections.

Mr. Speaker: Minister, just take your seat for a second.

Please continue.

Hon. M. MacDiarmid: …one of the best public education systems in the world, a system that is going to have, actually, over $5 billion invested in it next year in the school year.

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Let's talk about who is in support of the appointment of a special adviser. Just last week former NDP Finance Minister and Deputy Premier Elizabeth Cull indicated her support for appointing a special adviser in Vancouver. We're taking this step because the VSB has been clear they are having difficulty managing, and we look forward to the report of this special adviser.

Mr. Speaker: The member has a supplemental.

R. Austin: It's true. We do have one of the best public education systems in the world. And it's being….

Interjections.

R. Austin: Oh, wait for it; wait for it. Get ready to clap again.

It is being dismantled brick by brick by these people on the other side. Districts across the province are reeling from these costs and funding gaps. Here's just one example. The Central Okanagan school district is being forced to cough up $2.2 million for all-day kindergarten. Okay. But they have $2.8 million in contractual costs, $417,000 in higher MSP premiums, $57,000 in pension cost increases, $137,000 in carbon offsets, $102,000 in increased hydro and gas — more than $7.6 million in cost pressures.

Again, to the Minister of Education. She expects the Central Okanagan district to pay for $7.6 million in cost pressures. Will she admit that she's the one who needs a special adviser to look at her own books?

Hon. M. MacDiarmid: In fact, the ministry has looked carefully at our administrative costs, and we've reduced them by over 16 percent in the last two years. In 52 of our 60 school districts declining enrolment has been a reality for the last ten years — 52 of the 60. And by this fall we expect 60,000 fewer students in school rooms around this province.

We are saying it is time to look at doing things differently. It is time for school boards, and some of them are. It is time for them to look at doing things differently — sharing services, perhaps information technology, and making these steps so that they can maximize the investment in students and classrooms around this province.

[1400]

SPECIAL ADVISER TO

VANCOUVER SCHOOL DISTRICT

S. Simpson: What parents and trustees in British Columbia want is this minister and her ministry to do things differently and fund these shortfalls.

The minister appointed a special adviser in Vancouver, the only place where she chose to do that. She did that, and then she followed it up with disparaging comments about that district, about its board and about its ability to govern.

These terms of reference that the minister laid out all direct themselves towards the board and what the board is or isn't doing. But what those terms of reference do is neglect the question that trustees and parents across this province want answered. They want to know if there's enough money in this system to afford a quality education system for their children.

Will the minister change those terms of reference? Will the minister amend those terms of reference and put the question about the adequacy of provincial funding into the terms of reference?

Hon. M. MacDiarmid: The Vancouver school board has experienced an $85 million increase in funding while the number of students in classrooms in Vancouver has been reduced by over 3,000 students in the last ten years. Per-pupil funding next year will be increased by 31 percent since the number ten years ago.

Every single year in the last 17 years, this school district has forecast doom and gloom, terrible deficits. Last year they forecast they'd have a deficit of $8 million to $12 million, and they finished the year with a $16.7 million surplus. We do need to find out exactly what is going on. The school board chair has said that it is different this year than other years.

The special adviser will give us a report. She will let us know. She will look at how the board is functioning. She will look and see if there are administrative savings. In fact, the board chair has said she welcomes another pair of eyes to look at this district.

Mr. Speaker: The member has a supplemental.

S. Simpson: The $18 million deficit in Vancouver is only one of a litany of deficits. District after district in this province is projecting multi-million-dollar shortfalls in their ability to deliver education in this province. This isn't about Vancouver. It's about every school district in this province and every child in this province.

The terms of reference talk about the board's budget development process, talk about their management capacity and talk about their short- and long-term planning. Those questions could all be asked of this minister and how she runs her ministry.

Will the minister do the right thing, if she's serious? If this minister is serious about getting to the bottom of the challenges in education, will she ask the special adviser, the comptroller general, to do an assessment of whether she's adequately funding education?

Hon. M. MacDiarmid: The clear difference between the Vancouver school board and others is the statements they have been making about the changes that they propose to make this year, which they believe are

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unacceptable. At times they have stated that they have cut administration to the bone, and there are no further savings they can find.

This school district, like many of them around the province, is dealing with declining enrolment. We have classrooms not only in Vancouver but around this province, in 52 of the 60 school districts, that are 40, 50 and sometimes 60 or 70 percent empty — schools that have capacity of 70 percent within the school. We are aware of this, and we believe there are administrative savings that can be found, that there are ways of keeping changes away from the classroom and better ways to accomplish things with the best interests of students in mind.

We await this report. It will come to us at the end of May. We will make it available to the Vancouver school board, and we're hopeful there will be messages in this report that will be helpful right across the province as we deal with these issues.

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GOVERNMENT MAILOUT INFORMATION

ON HARMONIZED SALES TAX

B. Ralston: The Minister of Finance has made the complaint recently that some members of the public just don't understand PST exemptions and the proposed transition to the HST. Here in the Legislature the member for Comox Valley was speaking about logging, and he spoke about the purchase of chainsaws. He gave an example of a chainsaw costing $700 or $800 that would cost about $50 to $60 in PST right now. However, the Ministry of Finance tax bulletin on commercial logging says that buying a chainsaw for those purposes is already PST-exempt.

Before the minister spends hundreds of thousands of dollars on paying for a mailout at public expense, will he set members of the B.C. Liberal caucus straight first?

Hon. C. Hansen: It's interesting. Last week we pointed out some gross errors in the NDP website. We exposed them, and lo and behold, the next day they pulled that portion of their website. The next day we actually exposed the fact….

Interjections.

Mr. Speaker: Members.

Continue, Minister.

Hon. C. Hansen: The next day we exposed the fact that they had links on their websites to more information that was blatantly false. We exposed it, and lo and behold, the misinformation got pulled.

So we will make sure that accurate information gets out around British Columbia to actually counter a lot of the blatant misinformation that is being spread by the New Democratic Party and their members.

Mr. Speaker: The member has a supplemental.

B. Ralston: The minister makes repeated reference to what he calls factual information about the harmonized sales tax. In order that the mailout he's proposing, which is going to cost hundreds of thousands of dollars at public expense…. Will he ensure that it has a comprehensive list of everything that will cost more as a result of the HST?

Hon. C. Hansen: You know, what's obvious to me is that the NDP is afraid of us putting facts out.

You don't have to go very deep into the website at www.gov.bc.ca to find out that books will not be subject to the incremental 7 percent of the HST. Yet we have the member for Fraser-Nicola saying: "You buy a book; you got to pay up that HST." That is pretty basic information that you can glean from the website, if he at least took the time to go in and look at it.

We've got the member for North Island standing in this House and talking about the increased 7 percent on heating oil. We know that's false. That is basic information that is at the front of the website, and you would only have to spend about 20 seconds in the website to ascertain that piece of information.

I challenge the Finance critic and I challenge all of the members of the opposition to actually go onto the government website and learn some of the basic information about the HST and its impact, and he will get the answer to his question.

M. Farnworth: There is outrage out there. That's why they've got all the signatures already in the riding of Comox opposed to the HST.

I want to come back to a statement the Minister of Finance just made. He said: "You know, people should really go to the website." Trouble is that when you go to that website, there's no comprehensive list. There's not one comprehensive list of what's going to go up due to the HST.

[1410]

Could it be because that list is going to be page after page after page long? What you do see is nice graphics of gender-balanced, ethnically balanced, age-balanced, happy, smiling people saying support for the HST, when in fact, what people want is a comprehensive list.

Will the minister commit that when he spends his millions of dollars mailing out his information on the HST, it will include a comprehensive list of everything that will go up because of this government's HST tax grab?

Hon. C. Hansen: I'm glad the member has taken at least a little bit of time to explore the information on the website, because he now knows that, contrary to some of the information that has been spread, strata fees will not be subject to the additional 7 percent HST.

[ Page 4465 ]

He will now know from that website that gasoline and other motor fuels will not be subject to the additional 7 percent of the HST. He will know, for example, that car repairs and maintenance will not be affected by the change in harmonized sales tax. In fact, he should know that car repairs and maintenance will actually come down as a result of the shift to the HST.

There is comprehensive information on that website. It's linked to the Canada Revenue Agency website, which gives additional information so that people can determine all of those things that are either currently exempt as a result of being exempt from GST, which is the vast majority of goods, or goods that will not be affected at all as a result of this change.

Mr. Speaker: The member has a supplemental.

M. Farnworth: You know, really what it comes down to is that the Minister of Finance is mad. He's mad at Bill Vander Zalm. He's mad at the NDP. He's mad at the public of British Columbia. Because they just won't take his word for it or the word of this government.

Will he, when he spends his millions of dollars on this mailout, do what the public wants and show a comprehensive list of everything that is going to go up because of this government's HST agenda?

Hon. C. Hansen: It's actually pretty simple for the member to figure out. If it's something that's not currently subject to GST today, it won't be subject to the additional 7 percent of the HST. In addition to that, there is a whole list of goods and things that are on the website which are currently subject to the GST but which will not be subject to the additional 7 percent. That includes books. That includes children-sized clothing. It includes all motor fuels in British Columbia. It includes home energy costs. It's pretty easy for the members to figure out.

FIRST NATIONS CONSULTATION

ON HARMONIZED SALES TAX

D. Donaldson: The Union of B.C. Indian Chiefs opposes the implementation of the HST. Grand Chief Stewart Phillip says this tax will further marginalize and add hardship to First Nations families and communities. Just a few weeks ago the Union of B.C. Indian Chiefs reiterated their call for full consultation with the province before the HST is implemented. Their calls have been ignored by the Minister of Finance. The minister references gross errors. The people of B.C. consider that a gross error.

Now, to the minister: how does his failure to consult with First Nations on the HST fit with this government's promise of a new relationship based on respect?

Hon. C. Hansen: There are agreements in place with regard to the treatment of the goods and services tax as it applies to First Nations communities around British Columbia. The same agreements will be honoured — there's no change — and the same provisions would be applied to the entire HST.

Mr. Speaker: The member has a supplemental.

[1415]

D. Donaldson: It seems this government's new approach to consultation with First Nations under the new relationship translates to no consultation when it comes to the HST. Chief Matthew Sparrow, a member of the Union of B.C. Indian Chiefs' HST committee, says of this government: "They are brushing us off. The honour of the Crown is at stake." First Nations have legitimate and specific concerns about the HST. They've been asking the Minister of Finance for a meeting since November, and today they still haven't heard back.

To the minister: why won't the minister agree to meet with these First Nation leaders on his plans to impose the HST?

Hon. C. Hansen: I have received letters of concern from some of the First Nations leadership in British Columbia, and we have answered the letters that have come in. There may be still some in the works, but in those letters we reassure First Nations leaders in British Columbia that the same provisions that apply to the GST will apply to the HST.

GOVERNMENT AIR TRAVEL FOR

SITE C POWER PROJECT ANNOUNCEMENT

J. Horgan: Following the election campaign the B.C. Liberals revealed a $3 billion deficit. At that time the Minister of Citizens' Services advised this House and people of B.C. that there were comprehensive travel restrictions in place for government business.

My question is to the Minister of Citizens' Services. Can he explain to this House how a Learjet for the Premier and four planes chartered to fly to Hudson's Hope, an airport that sees zero traffic on a weekly basis, is justified at a time of a $3 billion deficit? How do you explain five airplanes for a press conference?

Hon. B. Penner: I appreciate the question and the opportunity to speak about the very significant announcement made earlier today by the Premier and the Minister of Energy.

As noted, the project announced today will take it to the next level, requiring a full, thorough public environmental assessment process, and that's a process that our government is committed to. We will be looking to ascertain and minimize potential environmental impacts

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associated with this project, which has the potential to build on the great legacy of W.A.C. Bennett and the large hydroelectric projects that have built this province for generations. I believe that, done properly, that thorough environmental assessment will meet all the requirements necessary to make this project go ahead.

Mr. Speaker: The member has a supplemental.

J. Horgan: I was going to ask the Minister of Environment about the carbon neutrality of a Learjet for King Lear and four airplanes to take up the boosters. I won't do that. I don't know how you make that carbon-neutral.

But I'm going to go back to the spin wizard. I'm going to go back to the Minister of Citizens' Service and Minister Responsible for the Public Affairs Bureau. How do you justify sending five planes full of people for a two-page press release? Why didn't we do it here like we do everything else? You announced an environmental review, not the second coming of Christ.

Hon. B. Penner: Better question is: how does the NDP continue to justify their flip-flopping on the issue of the Site C dam? Who was it that said: "We should pay a premium for renewable so that…."

Interjections.

Mr. Speaker: Members.

Take your seat.

Interjections.

Mr. Speaker: Members.

Continue, Minister.

Hon. B. Penner: I understand the NDP's sensitivity around this issue, because they're clearly deeply divided as a caucus due to the weak leadership on the other side.

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That's why we can have the following quotes: "We should pay a premium for renewables so that we can rid ourselves of technologies like coal" and "Why I get excited about the prospect of a large project like perhaps Site C…." That was the NDP Energy critic.

The NDP Leader of the Opposition has also said that Site C should be considered "if this project is approved after a thorough environmental assessment and has the opportunity to provide clean, renewable electricity for generations to come and to build on the legacy of W.A.C. Bennett."

[End of question period.]

M. Sather: I seek leave to present a petition.

Mr. Speaker: Proceed.

Petitions

M. Sather: I have 500 signatures from individuals in Maple Ridge and Pitt Meadows calling on the government to scrap the HST.

J. Thornthwaite: I have two petitions, one from Plymouth Elementary and the other from Fromme Elementary, with regards to possible school closures. A vote will be made tomorrow night with the school board.

Orders of the Day

Hon. M. de Jong: In Committee A, I call Committee of Supply — for the information of members, the estimates of the Ministry of Healthy Living and Sport — and, in this chamber, continued second reading debate on Bill 9.

Second Reading of Bills

Bill 9 — Consumption Tax Rebate

and Transition Act

(continued)

Hon. M. MacDiarmid: I am pleased to rise and speak today in support of the HST. Harmonizing the provincial and federal sales taxes will make our province a more efficient and more competitive place to do business, and one of the reasons I ran to become an MLA was to help to improve B.C.'s economy.

I know that a strong economy for this province allows us to be able to support the programs that are so critically important to British Columbians: our health care system, our education system and the many valuable social programs that British Columbians count on.

My constituents recognize that B.C. is facing significant challenges unlike anything many of us have seen in our lifetimes — the most significant economic downturn that we've experienced in this province, literally, in decades. I hear all the time about how important it is to take steps to improve the economy and create jobs for families.

[L. Reid in the chair.]

When I come into contact with my constituents, what I very frequently hear is their personal stories, their concerns either for themselves or often for their children or adult children who are completing education. They're concerned that the future will hold jobs and will hold a

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strong economy for them so that they and their children can have opportunities and can achieve their dreams.

The riding I represent is Vancouver-Fairview. It is the home of many small businesses, tech and biotech firms. Small, medium and large businesses are in this riding, and they make great contributions to our economy and to our community.

The bill before us is important because a strong economy creates jobs for people in Vancouver-Fairview and around the province and opportunities for them and for their families. In fact, harmonizing the provincial and federal sales taxes is expected to create 113,000 jobs over the next decade. These are jobs that one at a time will make a difference to the people in my riding and all around British Columbia.

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I know that families in my riding want government to take steps to promote job creation. Jobs make a difference to families. They allow them to achieve their dreams and to accomplish their goals and to live with security.

Prior to being elected I was a family physician in Trail, B.C. When I moved there in the late 1980s and as I worked there in the '90s, I saw young family after young family leaving the province because of the state of our economy — leaving a town they loved because there weren't opportunities for them there. Jobs were being lost. The economy was slowly grinding down during the 1990s. This is a town that essentially lost part of a generation.

Those families are starting to come back, but I certainly saw firsthand how critically important a strong economy was to their lives. I know for Vancouver-Fairview this is exactly the same.

There are some important compliance issues that make a difference as far as this tax goes. Harmonizing the two taxes will mean that businesses can spend less time calculating their taxes and more time focused on growing their companies. We've heard that this will lead to a more competitive business environment and more jobs for families. We've heard from some of these very businesses that they are expecting an expansion of their revenues, an expansion of investment. They believe that they'll be able to expand their businesses and that they will be able to hire more British Columbians.

Savings for small, medium and large businesses right across British Columbia will happen, as harmonizing the sales taxes is anticipated to save businesses about $150 million a year in compliance costs, and they've been very clear that these are dollars they intend to reinvest in their businesses. This is good news. I never hear business owners asking for government to increase their paperwork burden. This elimination of some of this paperwork, and the elimination of compliance costs, is welcome to these business owners.

Given all the talk we hear from the other side about how they support small businesses, why won't they stand up and support this initiative that will reduce small businesses' operating costs?

Here's what the B.C. Chamber of Commerce has said about the harmonized sales tax: "Tax-filing, compliance and other regulatory costs will be significantly lower under the HST, and this should be especially beneficial for smaller businesses."

I challenge the members opposite to actually support our small businesses, which are creating jobs and supporting our economy. In fact, in 2008 small businesses across this province employed one million British Columbians in dynamic jobs that added significant value to our economy all around the province.

The Retail Council of Canada has said that harmonization will result in a simpler and more efficient tax system for British Columbia businesses. This will help smaller retailers in particular who find administering two separate tax systems difficult and costly.

The New Car Dealers Association has added their voice to the support for the HST, saying:

"This is a terrific move by the B.C. government to improve the economy, and it's great news for British Columbians. For business, it means having to manage the administration of just one tax system rather than two. That will save time and money, and these days that's very good news for businesses, including the New Car Dealers Association."

The B.C. Construction Association has said that this will increase competitiveness with contractors inside and outside of British Columbia. No doubt that is why 29 of 30 OECD countries have adopted value-added taxes instead of using the old-style PST, and certainly that would be why more than 130 countries around the world also have value-added taxes.

What about investment? Well, we know that the HST will lower the tax on investment by 40 percent, and that will be another thing that will increase jobs in this province. Dr. Mintz, a well-respected economist right across Canada, has said that the HST will mean an $11.5 billion increase in capital investment. Are the opposition opposed to that kind of investment in this province?

The CEO of Coast Forest Products Association has said, "The HST means we will see increases in productivity and investment. We'll see, for the forest industry, levelling the playing field with competitors and providing the forest industry with an opportunity to invest in and maintain wealth-creating, high-paying jobs" — on an individual level, something that will make a difference in the lives of British Columbians who are in the forest industry.

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The Canadian Manufacturers and Exporters have said that the HST will save businesses money — money that can be reinvested in innovation and productivity and the development of new markets.

There are other voices of support. Journalist Calyn Shaw, back in August of last year, wrote about the HST at length. One of the things he said is: "Is this a policy

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that makes so much sense for the government that it belongs in the no-brainer category? Absolutely."

He went on to point out that it wasn't just government and himself that support this tax, the HST, but also economists such as Prof. Kevin Milligan from the department of economics at UBC. He's an enthusiastic supporter of this tax policy and gave it high praise. This is what he said: "HST isn't a left-right issue, and it isn't ideological as far as economists are concerned. It's just good policy."

This journalist went on to point out that, unfortunately, often getting lost in the HST argument is that in the long run, switching to a value-added tax instead of a retail sales tax is hugely beneficial to consumers. That's why government after government around the world has long since gone to a value-added tax. Just because we don't see the PST…. We know that it is often embedded and has often been paid numerous times on goods, as a cascading tax. That embedded tax being paid multiple times — it's hidden, but each time it's being passed on to consumers.

The HST is going to reduce costs to job-supporting industries in B.C., and we expect costs to come down over time by some $1.9 billion. Many other speakers have already spoken about the benefits, but let's go over them again — benefits of the HST to a number of different kinds of businesses in this province.

Madam Speaker, $140 million of costs removed from the forestry sector; $80 million from the mining, oil and gas sector; $210 million of costs removed from the transportation sector; and a staggering $880 million which will come out of the construction sector; $140 million removed from the manufacturing sector — allowing these sectors to be more competitive, allowing them to hire more British Columbians, allowing our economy to improve.

These cost reductions will help these important industries grow stronger as our economy recovers. It will help British Columbians who are already employed in these sectors and allow for further employment of British Columbians.

As Minister of Education, I heard concerns from school districts about what the HST would mean to their funding. That's why I'm proud that government is going to be providing an 87 percent rebate to the public school districts. These rebates will mean that on average, districts will not pay any increase in tax as a result of the HST.

But let's remember that ultimately it's the children who are in schools today — these children and their families — who are going to benefit from the future more competitive, more productive economy that will result from this change. Once they complete their education, they will find it easier to get their careers started when more businesses are hiring. Our students and their families will also benefit as prices for goods and services drop, as the hidden PST gradually comes out of prices.

About that hidden PST, according to the B.C. Chamber of Commerce, approximately 40 percent of PST is currently paid by businesses on goods and services which they use in their operations. This is a cost that factors into the price paid by consumers for the products they use every single day — a hidden, inefficient, embedded tax that is going to be gone when this bill is passed. By switching to a value-added tax, these hidden taxes will come out, and prices will drop for British Columbians.

As someone new to this House, I've found it interesting and sometimes puzzling to watch the NDP flip-flop on this issue. In 2007 and 2008 the members opposite supported the Finance Committee's recommendation that we should seriously study the feasibility of the HST. That sounds like they were in favour of the HST or at least in favour of seriously looking at it. When the government announced we were proceeding with harmonization, we saw another flip-flop, which reminds me of the carbon tax. They called for a carbon tax, but then when we implemented it, they opposed it.

[1435]

In 2009 they called the carbon tax the wrong tax at the wrong time. But fortunately, we think the NDP has changed their position on the carbon tax, and they're now in favour of it. I believe this is exactly what we will see in future about the HST.

When we see the new jobs that are created, when we see this inefficient tax removed, when we see hundreds of millions of dollars being reinvested in British Columbia as it becomes a more attractive place to invest, when we see new jobs, it will be very difficult even for the members opposite to continue to speak out against this tax.

What's really troubling is the misleading statements that have been made by the members opposite and that they continue to make. Just a few days ago in this House the member for New Westminster spoke about British Columbians on low and fixed incomes. She knows, or she should, that low-income families and individuals will receive a tax credit, an annual B.C. HST credit, of $230 for individuals with income up to $20,000 and $230 per family member for families with incomes up to $25,000. This will benefit over 1.1 million British Columbians.

One thing I wonder about the NDP's position on the HST is whether or not they would repeal it if they ever got the chance. British Columbians need to know about this. I wonder what the future will hold some years down the line when we see what has happened when we remove an inefficient embedded tax, which is paid over and over by British Columbians, and replace it with this value-added tax.

In the past the member for Cariboo North has said that harmonized taxes aren't bad. The member for Juan de Fuca has said that the NDP would get rid of the

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tax and increase other taxes. I think we can believe an NDP MLA when they say they will increase taxes, as we've watched them vote against every single tax cut we've implemented over the years — tax cuts that have made a difference for British Columbians around this province.

Their leader has said that tax cuts don't work, that they don't create jobs, but the Finance critic has said:"It's a bit like having your appendix out. It's very hard to go back." So the leader says they would serve notice and get rid of this tax, but I really wonder whether even the NDP would take this step.

B.C. needs leadership to get through these challenging times, and this leadership is not coming from the other side of the House. Making the decision about the HST was a leadership decision. It is clear that switching to this value-added tax instead of a retail sales tax will be a huge benefit to British Columbians. The current PST is a hidden tax embedded in the cost of many goods and services that we purchase, and often there is a tax upon tax upon tax — embedded PST paid multiple times.

From my constituents, with whom I've spoken many times about how critical it is that British Columbia has a government that increases jobs, that will do things to grow our economy…. When I think about the businesses in my riding, the biotech and tech firms and the many other small, medium and large businesses, it is very clear that this is the right thing to do.

When we go to a harmonized sales tax, we will be taking a step that will improve the economy in British Columbia, that will provide more jobs for British Columbia, that will make this a more competitive environment — a place that will attract investment and will be part of us keeping B.C. strong and having a bright future for all of our constituents and for British Columbians in every walk of life around this province.

In conclusion, Madam Speaker, let me say that I hope all members in this House will put their constituents first, will think about their constituents, will think about the future of this province and will vote to get rid of the job-killing PST. I look forward to the day when we will all cast our vote, and I will be able to strongly support this bill.

S. Simpson: I'm pleased to take this opportunity to stand in my place and speak to Bill 9, the Consumption Tax Rebate and Transition Act.

This is the HST bill for British Columbia. It's funny. When I talk to British Columbians and people about the HST and reference Bill 9 and this act, they say: "Well, what does that mean? What does the title of that mean? That doesn't say anything about the HST." I have to point out that this government didn't have the courage of its convictions to acknowledge in the title of this act that this is about the HST.

[1440]

I think that's endemic and reflects part of the problem this government is having with its lack of leadership as it heads and sort of spirals into oblivion in British Columbia.

This piece of legislation follows on what we've seen happen since the election. It's important to put this bill in context to understand where this all came from, as many people would say, many British Columbians would say.

I thought that before the election both the NDP and the Liberals said they didn't support the HST. I thought before the election they both responded to questionnaires and to inquiries from industry saying that they didn't support the HST. I thought we heard the previous Finance Minister, Carole Taylor, who chose not to run last time, say: "I don't support the HST." I thought we heard the previous industry minister Rick Thorpe say: "HST isn't going to happen."

So what happened to the Liberals? What happened here? Well, we're still sorting out what happened, but what we do know is that there was a breach of faith here. There was a breach of promise. We do know that the Liberals before the election were very clear in saying that this would not happen. We do know and we now know that within about three days after the election, officials at the Finance Ministry were on the phone to Ottawa talking about how they could in fact begin the implementation.

As has been pointed out by members on this side previously, we have no illusions that Finance Ministry officials take steps like that on their own accord. We have no illusions that when you've had previous ministers, numerous ministers — the Premier and others — all denying that they were going to move forward with the HST, it's just not believable that Ministry of Finance officials would take it upon themselves to move forward and advance that without some kind of political direction. It just is not believable that that would occur.

Before the election, you have the Liberals saying one thing. After the election, you have the Liberals doing exactly the opposite. That may be the single biggest thing in this whole debate that angers British Columbians. It may be that the single biggest thing is this breach of faith — that the government said one thing and did the opposite after they were re-elected.

That probably more than anything else has angered British Columbians. It's taken British Columbians, at a time when there's a fair amount of skepticism about the political processes as it is, and just beat them again with another stick, another reinforcement of this concern about lack of integrity on the part of this cabinet and this government.

The Minister of Finance wants us to believe that he knew nothing about his officials and their efforts after the election, that this was all about a coffee machine discussion with the federal Minister of Finance, Minister Flaherty, and that that was when this all started to come

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together. That's when the minister approached his federal counterpart and began to proceed with these discussions.

Now what we know about the tax itself is this. First of all, to call this tax policy in some ways is a bit of a misnomer. What this is, is a tax shift. It takes $1.9 billion of corporate taxes and shifts that $1.9 billion onto consumers and small businesses that are generally service-oriented.

Well, the Minister of Education speaks about the job creation, but it is that tax shift — not new tax policy that would generate other revenues but that tax shift — from corporate British Columbia of almost $2 billion to consumers and small businesses. That's why the restaurant industry says this could cost them as much as $750 million. That's an industry that employs 170,000 people in British Columbia, and they have raised that concern.

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That's why we're reading in the newspapers these days about developers scrambling to finish properties so that they can get them on the market and get them sold before the tax comes in, because they expect the market for new homes to depress. That's why the tourism industry has said it's their belief that they will lose upwards of 10,000 direct and indirect jobs related to the implementation of the HST.

That's why rental owners, apartment building owners, are now at the door saying: "This tax will cost about 3 percent additional costs for us to manage and maintain our buildings, and we want to pass those costs on to tenants." That's why strata corporations are saying: "We will have to increase our strata fees by as much as 3 percent, in some cases, in order to pay the additional costs that we will face because of the pressures of the HST."

These are all real cost pressures. They're all cost pressures identified by many groups that have traditionally been supporters of the B.C. Liberal Party and who, to start with, felt betrayed and now are beginning to realize how big the costs and the impacts are.

So you have a tax shift of $1.9 billion from corporations onto consumers and small businesses, the people who employ people in this province — small businesses, the largest employer group in this province. You have this broad increase in costs for all of those folks, and you have a reduced income.

The Minister of Finance has acknowledged that there actually will be less revenue coming to the public purse from this tax because of the requirement around exemptions. We have ministers across the board, but certainly the Minister of Education and the Minister of Health — pick your minister — who all stand up in this House and wring their hands about the deficit and wring their hands about the difficult financial situation we're in and wring their hands about how we can't afford to….

We have to cut services for people with disabilities. We have to take dental programs away from poor kids. We can't afford special education assistants in the schools. Pick your problem here. They wring their hands, and at the same time they don't see the irony of the fact that this tax — which is going to download all kinds of cost pressures on people who are least able to afford it, in many instances — is going to take a couple of hundred million dollars out of government revenue that would help to pay for those things.

Maybe if the Minister of Education was as concerned about kids as she would like to tell us she is, she might want to say something about that at the cabinet table, about where that few hundred million dollars could go to help pay for things in education. But I'll leave that up to the minister to decide to do that.

The other problem with this is the issue of tax sovereignty for the province. If you look back on the history of our tax policy, governed here in British Columbia with our own tax department, with ministers who have the ability to look at how that could be used as an economic development tool, how we can use it to stimulate the economy….

Well, there is capacity to do that. The capacity to do that was the ability of the Finance Minister, the Economic Development Minister, the Premier and others to be able to adjust the tax policy when it made sense in communities or in industrial sectors of the economy to be able to stimulate them.

Well, when it comes to this particular area of tax, a very lucrative one, we lose that ability completely and entirely. We no longer have the capacity to do that, because those decisions now will be made in Ottawa. They won't be made in Victoria. They won't be made at the cabinet table here. They will be made at the cabinet table in Ottawa. So we lose a tool here to be able to in fact use for incentives or to stimulate the economy that the members opposite like to talk about.

All of those are things that British Columbians are increasingly understanding, and as they understand it more, the response becomes clearer. The members opposite may have seen the Angus Reid poll that came out the other day. I'm not sure, but they might have seen the Angus Reid poll. It's possible.

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They might have seen the front page of the Vancouver Sun . "Liberals in a World of Trouble," I think was the headline. I'm not sure, but I think it was "Liberals in a World of Trouble." Interestingly, it identified the biggest part. There's a whole litany of things for the Liberals to be in a world of trouble about, but it identified, first and foremost on that list, the HST.

It identified — I think it was 82 percent — the number of people who had had it with the government over the HST — 82 percent of British Columbians. Now, I'm sure that the group of corporate leaders that are embracing this may not have been in that 82 percent. I'm not sure, but I suspect they might not have been. They're pretty

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quiet these days, but they might not have been in that 82 percent. But that 82 percent was made up of people who are frustrated for a whole range of reasons.

A lot of those people, as we know, had historically been supporters of the B.C. Liberals, had been members of the B.C. Liberal Party, had been on the executives of B.C. Liberal constituency associations — and they've had enough. They've had enough, because they disagree with the substantive notions of this dramatic tax shift onto the backs of everyday British Columbians, with no benefit that they can see, the shift there.

Mostly they are angry about the broken promise. They are angry that this government told them one thing before the election and then did the exact opposite after the election. That, more than anything, hon. Speaker, is what has infuriated British Columbians. The members opposite might notice, if they read the rest of the poll…. I'm not sure if they did, but if they read the rest of the poll, they might have noticed that that reflects itself in other aspects of the poll as well.

The problem with the broken promise…. It's a big issue because it begins to call again into question the integrity of the institution of government. We know that governments are having a tough time. Politicians are having a tough time these days as it is, regardless of political stripe. The public is not very happy with politicians all that much these days, for some pretty good reasons in some cases. What this government has done is just fanned that fire for all it's worth. They have fanned that fire of disgust and anger for all it's worth.

Why did the Liberals do it? Why on earth would the Liberals do it? Why did the Liberals put themselves in a place where 82 percent of British Columbians say that they are dead wrong? Well, that's a very good question. The only thing we can see at this point — other than that, you know, some of their friends are very supportive…. Some of their friends and donors certainly would like this tax break, so I'm sure that they were encouraged there.

But I think it has a lot more to do with a question of panic and scrambling to get out of a situation that they had put themselves into. Before the election, when the government was talking about not supporting the HST, you may recall that the Premier at the same time was saying: "A $495 million deficit, maximum." Of course, within a moment's breath, after the election, it all of a sudden became $3 billion.

That number was too big. That was too big for the Premier. The embarrassment was already there in terms of the incompetence of the government to manage that. After all of these glowing commitments and promises before the election, the bungling was just getting to be too embarrassing.

The government has an obligation, and I'm sure the Premier says: "We're getting that number down one way or the other." And along comes $1.6 billion of federal money, a payoff to the province for signing on to the HST. Well, this is the number that allows the province to get under the $3 billion — which, somehow, was a magic number, I suspect, for the Premier and the Finance Minister — to get under that number. So for three years the province has some extra federal cash — transition money, I believe it's called — in order to get through this period of time.

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The problem here is that the impacts of the HST — on consumers, on everyday British Columbians, on small businesses, on restaurants, on others — will last much, much, much longer than three years. Yet this Premier was prepared to trade all of that for $1.6 billion. That was the price. We often haggle about the price. That was the price.

The reaction of British Columbians to that: 82 percent of British Columbians angry with this government, furious with this government for their decision to turn their back on their promise, to break their commitment, to not fulfil what they said they would fulfil before the election.

We're seeing this reflect itself in a number of ways. We're certainly seeing it in the collapse of public support for the B.C. Liberal Party. I don't know how many election historians there are, but I'd suggest that maybe some members go back and take a look at the last time the B.C. Liberal Party was under 30 percent in support in British Columbia. It's going to be a while. It's going to be a while since the last time that the B.C. Liberal Party fell to less than 30 percent.

The telling thing here is that the numbers are continuing to slide. Every indication is they continue to slide.

The other thing we saw, of course — and we've been hearing a lot about that — is the citizens' initiative that's in play. Who knows whether the citizens' initiative will be successful or not, but what we do know, and what I am sure of, is that at the end of the day, whether it reaches the 10 percent threshold in every constituency or not, hundreds and hundreds of thousands of British Columbians will sign that initiative.

They will express their view and their opposition to the position of this government, and the government will need to make a decision at the end of the day, in July, as to whether they believe that they have any obligation to pay any attention to the people of British Columbia or whether they've simply dismissed that as a requirement for them as a government in British Columbia and that they can just move ahead. We'll see.

The only people supporting this are people who will find a direct benefit from it, and apparently, the list is quite small, because 82 percent of people are opposing it. So the list is quite small.

It's interesting. I heard the Education Minister and I heard the Finance Minister at different times. He stood up and talked about the Finance Committee and how the

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NDP, I think, voted in favour, where there was a unanimous report that there should be some serious analysis, I think he said it was, around the issue of the HST. Well, if the minister is to be believed, this kind of happened overnight. There was no serious analysis done. Nothing was done except somebody waved a $1.6 billion cheque in the face of the Premier and the Finance Minister.

His counterparts in Ontario are getting a pretty rough ride, too, but at least they had the integrity as a government to put the issue on the table, to be very open about it and to have a public debate about it before they actually came forward and said: "We are going to do this." There were a couple of months there where they allowed that discussion to go on. This happens overnight with no discussion and no consultation.

If they had been serious, the government might have said to the Finance Committee after the election: "We're interested in this tax. Finance Committee, why don't you go look at it?" That would have been an interesting discussion.

I'm sure the Minister of Finance could have joined the committee on a few of the visits around the province when his Chair of the committee tried to explain how a $1.9 billion tax shift from corporations to consumers was a good thing for people in Quesnel or in the Cariboo or in any of a number of other communities. It would have been interesting to have heard that. At least there would have been a discussion, some kind of process.

This government, this Finance Minister, this cabinet, the B.C. Liberals chose to tell nobody what their plans were. And immediately after the election, within three days, Finance officials are on the phone, to tell nobody what their plans are and then to ram this through — even though 82 percent of British Columbians are saying: "This is wrong. It's not what we voted for. You have no mandate to do this. Don't do it to us."

[1500]

That's not leadership. This Minister of Finance would try to tell us that this is leadership. Well, it's not leadership when people are misled about what the intentions are. They then get it rammed down their throat after the fact, when they no longer have any control over the matter or the ability to make a different decision.

If this minister or this Premier had wanted to put this on the table in April, before the election, and say: "I believe…." I don't know how many times I've heard the minister say: "It's the best thing ever for the economy." Well, it's remarkable that the best thing ever for the economy was something that was absolutely out of the question before the election. If the minister had put that on the table, convinced people during the election campaign to elect him and his colleagues based on that, we'd be having a different discussion today.

That didn't happen. It didn't happen because this minister and this government and this cabinet and the B.C. Liberal Party know that they would have lost the election if they had come forward and put the HST on the table before the election. So they chose to hide it, knowing full well what their intentions were afterwards.

This debate we're having here will continue until the government brings closure sometime around the end of this month or whenever they choose to do that. We will vigorously oppose Bill 9; the government will defend it. At the end of the day, unless seven or eight members of the government side come to their senses, presumably it will pass. I'm not counting on seven or eight members of the government side coming to their senses. In July we will see that the bill will then be in place.

Sometime in July, I assume, we'll see what the result of the citizens' initiative is, and we'll see whether we're back here having another discussion sometime after that on an initiative move, if that is a successful process. As I've said before, if it's not successful, if it doesn't meet the test, we will still see hundreds of thousands of British Columbians, many of them standing in line, take the time to express their view to this government over the HST and the situation with the HST. They will have done that by putting their name to that initiative.

So 82 percent….

Interjection.

S. Simpson: The member over there talks about misrepresentation. What could possibly be a bigger misrepresentation than, before the election, telling people you have one position, and then going and changing your position diametrically? There's nothing like that for misrepresentation.

The reason why politicians don't have integrity these days is because of the conduct of the B.C. Liberals and their position — a lack of integrity. The shame they must feel when they go into their caucus meetings. It must be embarrassing. How do you feel when you go home, Member? When the members go home, I'd like to know how your phones are ringing in your offices. They're ringing….

Deputy Speaker: Member, you do know to address your comments through the Chair.

S. Simpson: Absolutely, hon. Speaker.

They're ringing in your offices, I'm sure, every day with people saying: "Your party lied to me. Why are you voting with your party when they lied to me? Why did your party lie to me?"

Interjections.

Deputy Speaker: Members. Member.

Interjections.

[ Page 4473 ]

S. Simpson: I have no reason to withdraw it.

Deputy Speaker: Member.

S. Simpson: I have not suggested any member has lied.

Deputy Speaker: Member, it is not appropriate.

S. Simpson: I withdraw.

The reality is this. The B.C. Liberals said one thing before the election; they did something afterwards. That is at the core of the anger of 82 percent of British Columbians who know that this government has not got a mandate to do this. That's the reality.

The initiative will be what it is in July, but the debate will not end regardless of that. This debate will continue. It will move forward.

[1505]

Interjection.

S. Simpson: I'm sure that member will get a chance to get up and take his place in the debate when he chooses to do that.

Interjection.

S. Simpson: Clearly, hon. Speaker, I guess the member couldn't explain his position when he had his chance, so now he wants to take my time. But that's okay.

Hon. Speaker, you have a bill here that has no public support. You have a tax shift that will hurt British Columbians. You have less government revenue to pay for programs at a time when the government wrings its hands at every turn about its lack of resources. And you have a government that has taken its ability to manage tax policy and thrown it out the window with this tax.

This bill, I suspect, will pass sometime at the end of this month because as I said before, I'm not counting on seven or eight Liberals coming to their senses sometime between now and then. So the bill will pass. When the bill passes, the anger of British Columbians will go up. People are going to know it's a government that didn't keep its promise. It's a government that adopted a policy because it was desperate for $1.6 billion of federal money and was prepared to sacrifice around this tax in order to acquire that money.

The people are going to know that it's either a government that planned before the election to do this or, unbelievably, in a matter of a couple of weeks made the biggest tax policy change in the history of British Columbia without doing any due diligence around it. They made that commitment, and it's equally unbelievable. If the government wants us to believe and the Minister of Finance wants us all to believe that this decision was made over the coffee machine with Minister Flaherty, then it suggests that there was no due diligence done here at all. There was no due diligence done at all.

I look forward to ongoing debate on this. I look forward to having the opportunity to maybe rise in my place a couple more times and speak to this bill. I think that opportunity might come. You never know. I look forward to hearing from all the members over there as they try to explain to their constituents in every single constituency — the majority of their constituents who simply think they are wrong, who are angry with them and who are just furious with their decision to sell them out — this government's decision to sell British Columbians out for $1.6 billion. It's a sad, sad commentary, and it's a sad, sad commentary on this government.

With that, I see my time is starting to come to a close. I do look forward to hearing from the members. Clearly, some of them are enthused. I'm sure they'll be jumping up. I see there's a minister over there, I think, getting ready to get to his feet any second now to speak to this bill. We'll all be looking forward to hearing what the minister has to say.

Maybe this will be the first minister to get up and say: "I got it wrong. I guess I should have done something else. I've changed my mind. I kind of like my seat. I want to stay there, so I'm going to think about this one before I vote." You never know. The minister might say that. I'm not going to count on it, but the minister might do that. You never know. He's a pretty level-headed guy at times. He might do that. We'll see.

Interjection.

S. Simpson: At times. We'll see how he does with that.

Hon. Speaker, with that, I will take my place and look forward to the ongoing debate.

Hon. M. Coell: I am pleased to stand and support Bill 9, the Consumption Tax Rebate and Transition Act. I was reminiscing, as I was preparing to make this speech, as to the decisions that governments make. I've had the honour and the pleasure of being in elected office 25 years. I was reminiscing over some of the decisions I've made in local government as well as in government and also as an MLA in opposition.

[1510]

I wanted to share some of those decisions with you and the reasoning behind those decisions, and I think it'll become clear why I will be supporting the move to a harmonized sales tax during this period.

When we were first elected to government, we had a number of initiatives. We had a 90-day initiative based around tax reductions. We moved probably the largest personal tax reduction in B.C.'s history in the first 90 days when we became government.

[ Page 4474 ]

That was done in a time when we had just gone through 9/11 in the United States and the tech meltdown. We had a very sluggish economy, and we felt that decision would help grow the economy and create jobs. We had over a hundred different tax cuts during that period, and we also had deregulation. We set a goal of 33 percent regulatory changes. Those, I believe, helped to stimulate our economy and helped to grow the economy over a period of years.

There were other decisions we made at that time that changed the thinking of people. One of the jobs I had was the Minister of Human Resources, and it was our desire to have welfare reform in the ability of people to get jobs, to create jobs. We invested $300 million in training programs for people on income assistance. That was a change, a dramatic change, to the previous ten years of NDP government. That was a difficult time for adjustment, but it turned out that people were leaving the welfare rolls by the tens of thousands to find employment and to find employment at good-paying jobs.

Those were areas where we made conscious decisions on what would be the best for people, what would be the best for our economy, and so tax changes and changes to entitlements such as income assistance and the changes we made there proved to be successful over a period of years.

I think that when I look at some of the decisions we made in our last term — we looked at the need for increases in education, especially advanced education, and increases for training opportunities at the college and university level — we made those conscious decisions knowing that the economy was in a good state and that we had funds coming in so that we could expand educational opportunities.

We added $1.7 billion to the infrastructure of the Advanced Education Ministry. Buildings here in Victoria, for example — almost $300 million at UVic increased for medical school and increases in nursing. At Camosun College, $30 million. At Royal Roads, a $20 million building. All increasing the opportunities for young people. We did that because the economy allowed us to do that, and we had the funds to do that.

One of the decisions that took a lot of debate in this House in our last term, as well, was the Olympics. I think of the funds that were expended on a number of projects that will leave lasting legacies in British Columbia.

Those are the sorts of decisions that governments make. I think they do them — I believe on both sides of the House — with good conscience. I believe that you think about those decisions. You think about why they will make our province and our communities a stronger, better place.

The last couple of years since the recession have focused many challenges on government. I lived through the 1980 recession. As a matter of fact, I worked for the government in a program called the heroin treatment program in 1980. The recession hit. Government cut back on staff and cut back on programs, and that program and my job were lost. So I know exactly how people feel around the province when they lose their jobs because of a downturn in the economy. That is something I have experienced.

I think that this recession, although it came so quickly and caught governments off guard all across the planet, not just in Canada or the United States…. We attacked it in a variety of ways.

[1515]

I think that government, in responding to a change in income, looked inward to see what programs needed to be rationalized. We also looked at what needed to be stimulated, so with the federal government and local governments, we initiated a huge stimulus package that allowed people to continue to work as the private sector, in many instances, slowed up and in some respects became nonexistent in different parts of the province. We responded to those issues in a very direct and positive way.

With regard to a harmonized sales tax, it's something…. I've heard members on both sides of the House talk about the history of the harmonized sales tax as to how it had been looked at in the past, whether it was something that British Columbia wanted to have as part of its taxing programs. It wasn't very flexible in the past. It wasn't something that we had looked at. But one of the things that continually came back was that it would be good for the economy. It would stimulate the economy. It would stimulate the resource sector, the high-tech sector. It would help businesses get back on their feet.

As part of our government's look at how we improve the economy — and from my perspective, when you improve the economy, you improve the lives of people in our economy…. The harmonized sales tax is one that will bring, I believe, a sense of competitiveness back to British Columbia. I think it's one of many things we have to do.

I think we always have to look at our own house as to what the different ministries look like and how they're structured as to how best to fit into the economy. I think that creating a low personal income tax, the lowest in Canada, is something we need to do for competitiveness. Having reduced taxes on small business and the corporate capital tax and a number of other taxes that we've done away with…. I think that is part of the stimulus program to get out of the recession and get our economy working again.

One of the things that we've had to do with the harmonized sales tax is make sure that people of lower incomes aren't affected by it. I think the rebate program that will be in place, which will bring funds to those people of $20,000 and less, will help.

There are a number of things that we've done with the federal government to make it more flexible — those

[ Page 4475 ]

areas where there will be no harmonized sales tax. That will help the economy grow out of the recession.

One of the things I've always thought is an important part of our job as MLAs is to have an open discussion, and we are having that. As the last speaker said, it will be almost a month that we've been discussing the HST and the movement to that. I think that's positive.

There are a lot of people in our communities that are concerned, and I think we need to make sure they have the right information in front of them to make a good judgment for themselves. We will do that where we see it's needed, and we'll continue to discuss in this House in the coming weeks the need for a move to an HST.

I'd like to look at some of the things in the capital region that I think will benefit from the HST in the long term. We have a vibrant high-tech sector that is very supportive of this. I know that the chambers of commerce in the area are very supportive of the move to HST. But I think that in the long run, our tourist industry will also benefit from HST.

When you look at the literally dozens of countries around the world that have an HST or value-added tax, people will understand and respect that when they come to British Columbia. So not only is it making our province more competitive, we're actually moving in the same direction as the majority of the countries in the world with the value-added tax. I think that will also give us the competitive edge we need to compete in Canada and, again, with our competitors in the United States and Europe as well.

It's obvious that we have made a decision after a thoughtful discussion amongst the government and a thoughtful discussion amongst the members of this Legislature.

[1520]

There are no easy decisions in this job, I have found. There are decisions that you have to make and have to believe in your heart that it is in the best interests of our community, the best interests of our province. I think that the move to the harmonized sales tax is one that I can support fully, and I look forward to the debate continuing over the next few weeks. With that I'll take my seat.

S. Hammell: I am very pleased to join the debate on Bill 9 — officially the Consumption Tax Rebate and Transition Act, but in reality the bill that dares not speak its real name, the bill to impose the HST.

When the Premier and the Minister of Finance announced last July that they were going back on their word and saddling British Columbians with a harmonized sales tax, they said it would be good for people. In fact, they are still saying it — a little bit like taking cod liver oil or putting iodine on a cut.

It quickly became clear that British Columbians didn't believe the Liberal government members, especially those people who'd seen their income shrink or disappear in the last years and months on the watch of this government.

In his budget last month the Finance Minister tried to justify the HST by saying to people that it would go to pay for health care — the money collected. Even fewer people believed that line. Those listening laughed and then shook their heads in disbelief.

If I understand the government's intentions correctly, a bill is coming into this House enshrining that joke in law. No one believes or believed that line or spin. So the Premier and the Finance Minister had to go back to try to re-create why they were doing this hated sales tax.

Today we are debating Bill 9, the bill that will impose the HST. Actually, in being more detailed — and I know that everyone wants to watch the actual details of the facts — it is removing the PST. We have to ask why this government has not come out in this House and created a bill or named a bill that actually said what the bill was intending to do. The Consumption Tax Rebate and Transition Act really does mask the change that is coming into place.

I am sure that the Minister of Finance will identify the mailing he is about to do with the correct terminology. It will be, I'm sure, trying to sell the notion that there is a good reason — for reasons that obviously miss me — to bring in the HST when, prior to the last election, there was in fact a written statement that the government would not bring in the HST.

Like my fellow member on my side of the House who spoke just before the last minister, I think the anger that we are seeing around the province is largely a reflection of people being angry — not only angry at having a tax imposed on them that the government said would not be imposed, but just the mere notion that people felt tricked. They felt they bought something that wasn't really what they intended to buy.

So we have to ask at some point in time: why would a government run directly into the wrath of the people of the province by bringing in something that they said they would not do and risk people's anger?

An Hon. Member: Because it's the right thing to do.

[1525]

S. Hammell: I have been out in the community…. Hon. Speaker, I'm getting banter back from the other side. If it was the right thing to do, then you should have done the right thing and told the people what you were going to do. Within three or four months the world changed. I mean, nobody believes you did not see that train wreck coming. Nobody believes it…

Deputy Speaker: Member, address the Chair, please.

S. Hammell: …hon. Speaker, through the Chair. You can rant, and you can rave, and you can tear your hair

[ Page 4476 ]

out, but nobody believes that the train wreck was not seen…

Deputy Speaker: Member. Please reduce….

S. Hammell: …and that the government didn't see this coming, hon. Speaker. The people in the province — and I've talked to many of them in the last number of months — believe they were tricked. They believe they fell for something they didn't buy.

[C. Trevena in the chair.]

They went in their good faith to the polls. They voted for a government, and then the government has turned out to be something that they did not support.

We have to ask our question. I think you have to ask: who pays, and who profits by this? The HST comes right on top of other measures that are hurting British Columbians at the time of this recession.

Every time I get up in the House and have the opportunity to say this, I just cannot believe we are in the province that we live in and that we have the lowest minimum wage. We are having people who, on top of getting the lowest minimum wage, are having skyrocketing MSP premiums, hikes in hydro, hikes in ferry rates, hikes in camping fees, hikes in transit fares and gas bills among a number of things. And then you lay on top of it the HST.

People say: "Hey, I didn't buy into that. I've been tricked. I was never told. In fact, I was told there was a $495 million deficit, and we get one that's $2.7 billion. Follow that by another one that's $1.7 billion." My gosh, no wonder we went for the HST, because you get some money put into your pocket.

Hard-working British Columbians are already paying, and with the HST, they are being made to pay again. They'll pay every day they go out and buy some things that they never had to. If you're controlling your destiny and want to respond to the needs of your community, you control your own tax policy. Small business will pay for the HST just when they can't afford it.

Why is this government running for cover while they bring in this bill, hiding the fact that this is a bill to impose the HST? Why are they doing that, and why are they running for cover? Because they're avoiding the anger of not only ordinary British Columbians but small business people who are part of this very, very angry group of British Columbians.

Interjection.

S. Hammell: What planet do you come from? Like, 82 percent….

Deputy Speaker: Member, through the Chair.

S. Hammell: I can tell you that some 88 percent of the community of Surrey do not want this tax, and we have shared MLAs. We have MLAs from both parties. So I am telling you…

Deputy Speaker: Member, through the Chair.

S. Hammell: …the people of this province are absolutely furious over the betrayal of this government. I have seen petition after petition and signs in stores of small businesses. They are very angry. I've personally visited small businesses, and boy, are they ever angry.

Interjection.

S. Hammell: My, do I hear you protest too much? I mean, come on. You brought it in. Come on.

Deputy Speaker: Member.

S. Hammell: It's yours — right? You're proud of it. Through the Speaker, the members opposite must be very proud of this new tax.

[1530]

They don't really care whether the people of British Columbia feel they've been deceived or not. They don't care. In fact, the Premier has said that he doesn't care what happens. This is a done deal, and it's over. So he doesn't give one hoot. I almost said…. He doesn't give one hoot about what the people think, what they're saying, how they are demonstrating, what they're trying to tell the government, whether they've signed petitions in protest, whether they've signed petitions on line.

Nothing moves the government. You know all. You have made up your mind, and despite what the people of the community want, you're good to go.

Usually taxes are imposed to raise revenue for important services like health care, schools, universities, roads, police and many other social goods produced by government. The sole purpose of this particular tax is to cut the tax bills of big corporations and business and transfer those taxes to the working people.

Interjection.

Deputy Speaker: Member.

S. Hammell: It has been described again and again as a tax shift, a tax shift from big business to ordinary working people. It is all about who pays and who profits.

Interjections.

Deputy Speaker: Ministers, could you allow the member the opportunity to speak?

Continue, Member.

[ Page 4477 ]

S. Hammell: The HST represents some of the worst interest group politics we've ever seen from a government that has become notorious for helping big business and sending the bills to those least able to pay them. This HST is a reverse Robin Hood tax. Who pays, and who profits? The government has made a tax shift — clearly, a tax shift. While we are the same businesses that….

Interjections.

S. Hammell: Sorry, I have sort of lost my little…. That's all right. I'll just pick it up.

I'm hearing every day from angry people in Surrey–Green Timbers and around the province — the people who will have to pay the $1.9 billion this year and more every year to come. That's on average. It has been stated by other people. It's about $432 a person a year on average.

Interjection.

S. Hammell: If the member…. I gather the member has already had his time up to speak. So he's not only wanting to take part of my time, he's wanting to take….

Deputy Speaker: Members and Minister, could we allow the member who has the floor the opportunity to speak? Everybody has the opportunity to speak in this debate, and some have participated already. Others will have the opportunity to participate.

Member, please continue.

S. Hammell: People who work hard every day will have to pay that tax to access a long list of necessities, such as their morning coffee; repairs to homes, appliances and cars; professional services; haircuts; taxi fees; funerals; and many other things. The cost of many goods and services will increase. Who pays, and who profits?

In Surrey parents and children who play hockey will have to pay by coming up with an extra $30,000 a year to pay the HST just to rent the ice. That's on top of paying the HST for pads, helmets, uniforms, the drive to the rink and even a coffee or a hot chocolate.

This is from a government that just weeks ago literally proclaimed from the top of mountains its dedication to sports and fitness. Some children will no doubt pay for the HST by losing their shot to play hockey, and who will profit? Ottawa will profit while British Columbians pay.

This government is giving away the power that this Legislature has had for decades to change sales tax for public policy reasons. Interestingly enough, this government is partnering with its Conservative friends in Ottawa to make hockey and other fitness activities more expensive with the HST, even though that government in Ottawa is on record as being in favour of fitness with a children's fitness tax credit.

[1535]

This government's giveaway of our powers to Ottawa means that this province's sales tax exemption for energy-saving appliances and building materials will go out the window. So the environment will also pay for the HST. The cost of this measure will go well beyond the 7 percent HST. The example of children's hockey shows that the HST will make life more expensive and more complicated for many in British Columbia.

Speaking of complications, small business will pay the most for the HST. Many small businesses will pay in the form of unhappy customers who will reduce their purchases or do without rather than pay the HST. Professionals of all kinds, including some health care providers, will be charging provincial tax for the first time. That means they will have to make their customers pay extra to maintain their health, keep their accounts in order or get help in buying or selling a house.

Many other small businesses will pay the HST, and while they pay, who profits from this tax? Big business will profit to the tune of nearly $2 billion with the HST — big business including oil and gas, forestry and mining. This government claims that the HST will lead to new jobs, but their claim is empty.

Let's take a look at forestry. The fact that this government has just laid off 204 more employees from the Ministry of Forests and Range shows that it has virtually given up on our forest industry. This is a government that declared they were mere spectators as they watched the forest industry collapse. This is a government that removed the obligation that forest companies once had to process timber here in B.C., a move that has cost jobs and deepened the despondency in forest communities.

This is also the government that has released large tracts of land from tree farm licences, most infamously in the constituency of my colleague from Juan de Fuca, freeing companies to sell land to developers and foreclose the future of the affected communities. These corporations are already profiting at the expense of taxpayers, thanks to this government, and now the forest industries gain to profit again from the HST.

Why is this government so generous to the big corporations? Perhaps it could be that the Liberal Party has done very well by large forest companies. A couple of years ago it was estimated that the B.C. Liberal Party got $6.5 million in political donations from forest companies in the previous decade. These companies vociferously…. I remember the day they got up and supported the Liberal Party in the last election. It appears that the B.C. Liberal Party will ultimately profit from the HST.

The story is similar in other big businesses that are benefiting. Once the election was over, and once the B.C. Liberals had assured voters there would be no HST in British Columbia, the Premier and Finance Minister changed their minds without bothering to check for evidence, save for the word of those who wanted the HST. Big business in B.C. will benefit, and the CEOs of the big companies.

[ Page 4478 ]

The government says this tax break to the big corporations will lead to jobs, but there is no hard evidence, no studies to prove this — only wishful thinking. While those businesses profit, who else will pay? Hard-working community organizations that provide badly needed services to British Columbians in need will pay. They will now have to pay HST. Their accounts will become more difficult to manage.

Many of these organizations work with the government to provide education, social services and health care. The HST will yet be another hit to those services and to the British Columbians who need them, and those people are already suffering under the cutbacks being imposed by this government.

[1540]

We will all be paying more for necessities, such as many food items, and even for rent and condominium fees, though indirectly through contracted costs. These increased costs will be difficult for many people to bear, especially those who live from paycheque to paycheque.

So who will be paying for this regressive tax? People who can't afford it. And who will profit? Well, the HST will bring an end to the luxury tax on large gas-guzzling vehicles, so the environment will pay, and car dealers will profit.

A group that will be hit especially hard is our tourism and hospitality industry. This year is turning out to be tough for our tourism industry already. Americans and others are cutting back on travel because of the recession and particularly because of the rising dollar. If you have a dollar that's on parity and then apply a 12 percent harmonized sales tax, you are making it very unattractive to come to British Columbia when you have the sales tax on many other items. This government is throwing our tourist industry another 7 percent millstone around their neck, and to complement that industry, our restaurants will pay.

It just amazes me. I mean, the tourist industry and the restaurant industry have been absolutely clear in their opposition to the HST — absolutely clear. Restaurants see they will have to cut jobs because of the HST. They actually had that experience when the GST was first applied, and they understand perfectly what's coming down the line. They know that they are one of the biggest employers of youth in this province, the restaurant industry, and they are worried about the youth and their ability to not only enter the job market but then to support going to university and schools.

Again, it amazes me — the denial, denial, denial from the other side. The members from the other side said prior to an election that they would not do this. They also said there would be only a $495 million deficit. After the election — wow. Now we have a $2.7 billion deficit, and we have the HST. Why people on the other side would continue to harangue and harass people when they just say what is clearly on the record….

I mean, I am sure the Minister of Finance is going to put in that infamous brochure every single thing that goes up as a consequence of the HST. Therefore, we can all agree that here are the benefits, according to Hoyle, and here are very clearly the deficits that people are going to have to pay in terms of their pocketbook. Small business will pay. When the Premier and the Minister of Finance…. My observation is that they have been having some difficulty convincing people that the HST is good for them.

I sort of started off with the notion that it was good like cod liver oil. They were being told it was good like cod liver oil or good like iodine on a cut. But it doesn't matter how good…. It reminds me of when we were told, "Don't worry; this is hurting me much more than it's hurting you," when we were kids and had to do something that we were being punished for in some way. There was this real sort of sense of woe from our parents. Just suck it up — right? — and just take it on your shoulders because it is good for you.

[1545]

When they announced the measure, they didn't have the information, though, and I have to hark back to my colleague from Vancouver-Hastings. I mean, if you are going to do this kind of massive change to the lives of ordinary British Columbians and you're going to take a shift of taxes of almost $2 billion and move it across to regular people and ask them to pay, you would think that you would have done a study to prove it was a good idea, prior to doing it. You would have thought that you'd have done it — right?

You would have gone out and done due diligence because, of course, you are the masters of all that you are…. You are much, much wiser than me when it comes to finances. You would have just, in your wisdom, done studies so that when you walked out to do this kind of change to the community that you were governing, you would have had some kind of explanation other than: "Just trust me. It's good for you."

Ordinary people will see their cost of living going up. They are upset about that. I've spoken to many of them. Actually, many of them are worried about seeing their jobs and their incomes disappear. Some believe their businesses will also disappear, and I can reflect that directly as people have talked to me, particularly in the restaurant industry. I give a lot of weight to what the people there tell me, because they've lived it. They lived it, as I just mentioned, through the implementation of the GST, so they understand the impact that this kind of tax has on their livelihoods.

As the people in our communities, the people who sent us here, struggle to get out of the recession, they have awoken to the fact that this government and this bill, in their eyes and in mine, are part of the problem and not part of the solution. They see, when they look around, a government that has grown increasingly out

[ Page 4479 ]

of touch with the people of this province. All of us have a responsibility to remain in touch and reflect on the needs and the wishes and the voices of the community we serve.

Also, unfortunately, they have learned about the value of a promise from this government. When they have been promised or told that you would not bring in the HST, and shortly after, the Finance people are in there talking to the federal government about how the issue of the HST works and how to think about it, then they really have learned about the value of a promise. British Columbians will remember this bill when they go to the next ballot box.

Hon. Speaker, it has been a long, long time in my memory — and my memory is somewhat lengthy — since I have seen an issue that is so powerful in the community as the broken promise of the HST. This government has only one chance to redeem itself. It can listen to the people, remember what it promised a year ago and join us in voting down this bill. If they don't wake up and kill this bill, the government will also pay in the long run for the HST.

R. Cantelon: Certainly, this is a quantum shift, and certainly, it is a bold move. The move is about jobs, creating investment and opening up opportunity, and that's the thrust behind this bill.

[1550]

Madam Speaker, I, too, have been in my constituency, and I, too, have been talking to many of the business operators and individuals. There's no question that there's a lot of misinformation. Of course, it doesn't help when many of the websites that advertise the GST have misinformation, such as home heating oil being taxed. I think both sides of this House need to be responsible in how they present the information.

Now, the member opposite was talking about small businesses. "It won't help," she says. "They'll pay." Well, they will pay, but they'll get the entire GST back. I think that's a significant difference, and their businesses will be made much simpler.

I was speaking recently to a retailer in a shopping mall. He's a clothing retailer. Of course, he does buy his clothes now tax-exempt, so he doesn't have an input cost directly there. But on the other hand, neither will his customers pay anything different. It'll be the same total tax, 5 plus 7 — 12 percent that they pay now — in combination of tax from GST and PST, in exactly a harmonized tax.

For the vast majority of purchases that the public make, they will see no difference, except they'll see one single tax.

For this particular retailer, of course, many of the other costs that he does have, unrelated to the specific costs of his goods — costs for computers, for example, things like that, and things that he needs as business aids: shelving and display materials for his store — he used to pay PST on and, of course, basically had to embed the cost of these secondary purchases to his business but essential components of his business. He had to pass the cost of that on indirectly into the cost of his product.

One thing I think most importantly from this small business man's point of view, and I know this is shared by many small business men, is that his work is greatly simplified. Even though he is, I would say, a relatively small-scale retailer, he pays $50 a month simply to resolve the two cost inputs that he has — the GST and the PST. He passes it on to an accountant to keep track of these two costs and to make sure that they're handled properly in his business.

Well, that burden is lifted not only for his business but for all businesses across British Columbia. Now you deal with one tax and one tax only.

I think that's one of the misconceptions that many people have, both in business and private, that somehow this is a new tax. Indeed, basically the old tax, the PST, is being eliminated. It wasn't a pretty tax, if I may use that analogy and use that comment. It was a very complex tax, and it was very unfair in many ways — the way it was applied to different businesses.

Recently, when I was in a different role as the Minister of Agriculture, I had the opportunity to talk to farmers. Of course, many of the items that they can buy are PST-exempt, only the trick is that you have to apply. You have to validate what the purchase was for, that it was related to a farm expense. Some items were included; some weren't.

If you looked at the purpose that the two items were used, the machinery and the farm, you'd say: "Well, why aren't they both exempt?" But one would be, and one wouldn't be. It was, as it developed, a very arbitrary construct of complicated taxes that affected the farming industry.

Well, now the farmers have greatly appreciated and welcomed the HST as simplifying it and wiping that complex byzantine structure of taxes out and replacing it with a simple tax that comes back to them when they submit their GST rebates.

There's no question that on Vancouver Island, particularly, it's going to be of great benefit. I was meeting recently with a group of citizens who represent different communities within the Oceanside area. They're supporting me and supporting the effort to put a health centre into Parksville-Qualicum, the Oceanside area. It's needed. It would handle urgent care. It would handle ongoing clinical care, among other matters.

I took the opportunity, after we met, to talk about the HST. There was kind of a smile, because it was a broad political spectrum supporting health care, as you might expect. Not all of them were supporters, politically, I would say. So we had a good discussion about that.

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Now, some of the people — actually doctors, who are involved in business — immediately recognized the value. They said: "Well, you have to raise the money somehow." I think that's something that, on the opposite side of the House, is not part of the equation — clearly, not part of the equation.

Not raising it is an issue. How you replace that revenue is another. Certainly, how would you replace the $1.6 billion, which has been disparaged by members opposite, in the cost equation? We would then have to, I suppose, if we abolished it tomorrow, somehow have to recoup the $1.6 billion that's coming to us from the federal government to help us to adjust through this period.

Either you have a bigger deficit or you tax somewhere else. That was exactly the comment by this one gentleman.

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Another woman there, who I would not think necessarily was a supporter of our political efforts, commented, and quite correctly, that all the revenue from the HST is targeted towards supporting health care and health care measurement, health care improvements.

She said: "Well, if we don't support it, how do we get what we want? How do we get the health centre? How do we get these new things that we want? We want a lot of new things. We want a lot of new services, particularly in the health care field. But how do we get them if we are not ready to face the taxation that comes with that?" That, I think, was an important comment from her.

Yet another gentleman brought forward a comment. He asked me about this e-mail that's gone viral, as they say, suggesting that $2,100 would be the average cost to the average consumer, the average taxpayer in British Columbia. Now, he wasn't aware — and it's part of the whole sea of misinformation that's going out on this topic, which does no credit to either side and no credit to the issue itself — that it would cost $2,100 for extra costs above and beyond what they paid on PST.

Well, it was very interesting. In fact, a realtor challenged me and said it was going to cost him $30,000 more. Well, just to do the reverse, to invert that and divide by 0.07, you quickly come up with the fact that in order to generate $2,100 of additional taxes, you would have to buy $30,000 worth of goods and services that are presently not taxable with PST.

Let's just give that a consideration for a moment. That would mean that out of their disposable income, the average person — this wasn't some high-rolling Wall Street or Howe Street guy; this was, presumably, an average worker — would have their costs increased by $2,100.

Now, immediately in that there were some mistakes, of course. They had included things that are not going to be taxable — home heating energy, not taxable — and there were many other basic errors like that. Some people think, for example, that food is going to be taxed. I think people think this is a new tax on top of whatever else you're already paying.

You'd then have to somehow spend $30,000 on the items that are going to be taxed. Well, okay, let's take…. I'm a golfer, and my golf club membership is such that I pay $2,000 a year. That would be $140 on an annual basis, so about $20 a month. Well, we're a long ways from $2,100. And I think many people would consider golfing as a luxury. In fact, one of the comments that was made in this same meeting of health concerns was that they had no sympathy for golfers about paying the extra fee, and I gather members opposite may share that view. I'm not sure.

In any case, you then have to spend $30,000 on restaurants, haircuts and these other items before you get to it costing you $2,100 more. It's, frankly, virtually impossible, if you think of the fact that, of course, gasoline is exempt. Your car purchase is not only exempt, but you will now get that back. It will cost you less if you go and buy a new car — for business, certainly. Clothing you're already paying PST on, so that's not an incremental cost.

It has to be just purely incremental costs, and I defy anybody to show me how with an average income — let's say in the $50,000 to $80,000 bracket — they can construe that they're somehow, out of that kind of disposable income, going to spend $30,000 of it to generate a $2,100 a year tax increase. I think it's just simply not feasible, and it's one of the large misconceptions on this.

I mentioned small businesses. There isn't a small business that won't benefit directly on this. Virtually all of them will have some costs that they'll be able to recoup the GST on.

Some are particularly significant. In the building trade, for example, take a manufacturer of roof trusses, which are a major component of the construction industry. Right now, of course, they go and buy the material from a lumberyard, and they pay 7 percent. They go and buy the braces and all the other equipment and some of the other office equipment they need to generate the roof trusses, and they pay 7 percent.

That cost, of course, is added to their basic cost factor, and then 7 percent is charged on all of that. So we have the multiplying effect of 7 percent on 7 percent, a tax on a tax, and that increases their costs.

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Now they're going to have that removed. That's going to be absolutely pulled out of their cost equation, and some people, of course, say they'll just pocket the profits. Well, they may, and in some cases….

In this particular gentleman's case, he went, when times were good and booming, from 300 employees to something around 180. I know what he'll be doing with it. He'll be hiring people back. It'll enable him to invest further in his equipment in terms of human capital

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and investment in machinery and equipment. Yeah, he might take a holiday too, but considering the volume of his business, he'd have to travel around the world a gazillion times to spend what he's going to gain back from the HST into his business.

So that's how it's going to affect moderate-sized, middle businesses. It's going to improve their profit picture. They're going to invest in new equipment, they're going to hire more people, and they're going to be able to increase the wages. So it's good value throughout the economy.

Now, if I can, getting back briefly to the costs to individuals. Of course, there is an immediate benefit. The income tax threshold was increased to $11,000, and that's an immediate tax benefit of $80 a year to an individual, or if they're making a spousal complaint…. Not a complaint. Please forgive me for that slip of the tongue, Madam Speaker. I certainly wouldn't do that, particularly since it's my wife's birthday on Wednesday. I'd never want to be accused of doing that in this House. I hastily retract that, and I hope Hansard notes that.

The total spousal declaration would be $160. This alone gives you about $2,000 worth, offsets $2,000 worth, of purchases that you might otherwise make that would have been non-taxable under PST. That will buy, certainly, the golf membership that I mentioned earlier and probably a few haircuts on top.

Our whole approach has been, historically, to lower taxes, to lower the bite on the individual pocketbook, because we feel, and it's something we've continued to work on and to espouse in legislation, that the taxpayers are the best people to decide how their money is spent — to make those choices personally and to make those choices for their own betterment or investment.

That's why, over the last eight years, we've cut taxes over 120 times. Now, the disadvantage, if you want, is that it doesn't really hit a person. They say: "Oh, well, that's nice, but what does that really mean?"

Well, what it means…. I had this discussion recently in a meeting. It was a very cordial meeting, I hasten to add, with the local Nanaimo District Teachers union, BCTF. They were very cordial, and we had a very, I would say, constructive and positive discussion.

I showed them, roughly speaking, that someone who had an income of $70,000…. They agreed that that might be somewhat equivalent to what a teacher's income is at the time. In 2001 the provincial tax on that would have been $7,000 — $7,025, to be precise. In 2009 that has been reduced to $3,829, a 45 percent reduction and a nearly 31 percent saving.

Certainly, if we were to suddenly raise those taxes back up, I think the howls of protest would be equal to what we're seeing on the GST. I'm sure the members opposite plan to — or I hope they plan to — do something, because with the deficit being whe