1977 Legislative Session: 2nd Session, 31st Parliament

HANSARD

The following electronic version is for informational purposes only.

The printed version remains the official version.

Official Report of

DEBATES OF THE LEGISLATIVE ASSEMBLY

(Hansard)

FRIDAY, JANUARY 28, 1977

Morning Sitting

[ Page

425 ]

CONTENTS

Routine proceedings

Tabling reports

British Columbia Steamship Co. annual report. Hon. Mr. Davis — 425

Budget debate

Hon. Mr. Curtis — 425

Mr. Barrett — 431

Hon. Mr. Chabot — 437

Mr. Skelly — 442

FRIDAY, JANUARY 28, 1977

The House met at 10 a.m.

Prayers.

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

Mr. Speaker, I'd like to draw to the attention of the House this

morning two groups visiting in the galleries. First, from the

constituency of Saanich and the Islands, is a group of Saltspring

Rangers who will be observing our deliberations for a while and then

touring the parliamentary precinct. Secondly, a former associate of

mine in broadcasting who has gone on to assist young people in terms of

entering broadcast journalism, Barrie McMaster, has with him 10 members

of his senior class of broadcast journalism — students from BCIT in

Burnaby. Would the House welcome both groups?

HON. K.R. MAIR (Minister of Consumer and Corporate Affairs):

I would like to take this opportunity to extend my congratulations and

ask the House to join me in congratulating the Minister of Agriculture

(Hon. Mr. Hewitt) on his fifth consecutive 39th birthday.

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

this morning is a group of adult students — 17 in number — from the

Pacific Centre in my constituency. They are accompanied by their most

capable instructor, Gladys Kraft, and I would like the House to bid

them welcome, please.

MR. E.N. VEITCH (Burnaby-Willingdon): Mr. Speaker, seated in

the gallery this morning is my wife Sheila. As well, I would like to

bid welcome to Mr. McMaster and his group from the broadcasting class

of BCIT which is situated in the great riding of Burnaby-Willingdon.

Hon. Mr. Davis tables the annual report of the British Columbia

Steamship Company

(1975) Ltd. for the year ending December 31,1976.

Orders of the day.

ON THE BUDGET

(continued debate)

HON. H.A. CURTIS (Minister of Municipal Affairs and Housing): Mr. Speaker,

I rise to support this budget. It's also my first opportunity to participate

in debates in this session of parliament, and I would like to extend my own

congratulations to those members of the government party who, since I last spoke,

were elevated to cabinet position. I've enjoyed working with them as members

of the caucus and now as colleagues in government.

Since I last reported on Municipal Affairs and Housing in this

House, Mr. Speaker, the two ministries have been joined together in

what this government believes to be a logical and productive way. The

two sections of the ministry remain distinctly separate in some

essential respects, but where co-ordination appeared sensible, it has

been carried out and, in my view, carried out very well. Payroll and

accounting procedures, personnel matters and mechanics of office

operation have all been merged for efficiency and greater

effectiveness. In some ways this would seem to resemble that which has

existed in the Ministry of Health for a number of years — where a

single minister reports to the House, while senior departmental people,

public service personnel, deal with a variety of programmes that must

be compatible and yet where clearly separate skills are necessary.

And so, in Municipal Affairs and Housing, in our relationships with

the people of British Columbia, with members of this House and with

representatives of local government, we can now offer the degree of

co-ordination that they expect and that, in my view, assures prompt,

fully informed, fully co-ordinated response.

The housing

section of this budget, particularly the housing and

development vote of $71.77 million, is sufficient to guarantee that the

province of British Columbia can adequately meet the demands of our

citizens for a wide variety of accommodation: ownership, rental, mobile

homes, cooperatives. That $71.7 million is an amount which reflects

more than grants and subsidies to organizations and individuals. It

also ensures that proper cost control and accounting methods are firmly

in place. In my first year responsible for this ministry, it became

apparent that this was one area of the ministry's activities to which I

had to address myself with the greatest possible attention and speed.

It's to the credit of all the staff in the housing

section of the

ministry that this degree of control has been implemented in

approximately one year — control that was not in place in the first

years of the former Department of Housing from late 1973. You see, Mr.

Speaker, we spent a great amount of time in just over 12 months, just

simply sorting out the maze through which the old department appeared

to wander in its first years. It's a complicated and often bewildering

story.

Even in the context then, and we have to go back to that period, of

an extremely tight housing market, it's obvious now that the former

government had no well-defined plan and did not really understand what

it wanted to do in housing or the dollar costs involved. It was in fact

— and this is abundantly clear now, Mr. Speaker — anything at any cost.

There was a lack of co-ordination between ministries and, to a certain

extent, a lack of accountability. It's a matter

[ Page 426 ]

of record, Mr. Speaker, that in the fall of 1974,

while the housing fund was considered ample at some $50 million, there

were commitments of one kind or another for several times that amount

of $50 million.

There were few, if any, projections as to the ultimate cost to the

province, to the taxpayer. Apparently it was understood, in round

figures, where the Central Mortgage and Housing Corporation commitment

to British Columbia stood. But there was a lack of management restraint

and a lack of an overall understanding of the despair of some

individuals.

A few examples may be of use to the House today. Pitt Meadows is at

the top of the list. This was a proposal-call project. In its first

conceptual stage, the development was to comprise approximately 480

duplexes — 480 or 490 — to be disposed of, it was thought, as one-third

co-op, one-third rental, and one-third sale. The firm of Community

Builders Ltd. was authorized to proceed with securing a land-use

contract. Negotiations were protracted, and that's something of an

understatement.

In August, 1974, the former Minister of Housing authorized Dunhill

Development Corporation to pay out $2.5 million for the project. Now

notwithstanding his good intentions, I'm sure, 1974 stretched into 1975

— still no land-use contract with Pitt Meadows, but the people of

British Columbia, through the former government, had advanced up to 100

per cent of the value of the land.

It was in the spring of last year — in April, 1976, I believe — that

this government brought the situation to an abrupt halt until we could

be assured that public dollars were fully protected. However, even then

it was too late in some respects. You see, Mr. Speaker, there was a

clause in the original agreement signed by the former government to the

effect that if the project was not well underway, foreclosure would

take place and the original interest rate built into the agreement

would accelerate from 8 per cent to 12 per cent. However, even that did

not happen, because of a trigger date in the agreement. That clause in

the agreement dated October, 1974, would have allowed the Crown to

waive its option to purchase the development prior to the execution of

a land-use contract. Somehow, regrettably, that key date of April 1,

1975, was permitted to slip by unnoticed and with no action.

Now, of course, in the context of our present housing situation,

there is no ready market for 480 duplexes — units of special housing —

on that land, if indeed there ever was, even in that tight housing

crunch.

The Pitt Meadows problem has occupied a tremendous amount of time in

this ministry since December, 1975, and I'm now hopeful that the matter

can be resolved in a satisfactory way. We're not out of the woods on

it. We hope to provide a mix of housing and also, which is our

responsibility, to protect the public's heavy tax-dollar interest.

Most members, Mr. Speaker, will also know of another major socialist

project called Burnaby-200. This was initiated in 1974 with the

intention that it would be a sensitive development regarding open

space, environmental considerations, low density. Architects were

commissioned to produce a development concept, and that original

proposal projected a yield of six units per acre, a disastrously low

density in relation to a comprehensive development of 240 acres unless,

of course, it was to be in single-family lots.

Nevertheless, the concept was accepted by the former minister (Mr.

Nicolson) who, I understand, expressed satisfaction with the proposal.

In April, 1975, a report by the district of Burnaby planning department

endorsed the low-density conservation approach and suggested a high

level of capital contributions from the developer. In spite of the

already weak economic profile, a decision was made to add to the land —

to purchase another 13.8 acres of land, at $1.2 million, from the Lake

City Industrial Park. The number of additional units to be made

possible through this purchase did not cover the increased cost. In

fact the purchase and servicing of the additional land eventually added

$1,700 per unit to the cost of all the units to be produced in the

total project.

Also in June, 1975, the government of the day acceded to Burnaby's

request for a park, the Lake City land, a school site, and substantial

contributions for a recreation centre, and all of this costed out to

another $1,800 per unit over the entire development.

Yet another critical decision on Burnaby-200 related to the

acquisition of 21 acres of municipal land purchased for $40,000 per

acre. This one, Mr. Speaker, staggers the imagination, for it was land

that had been acquired earlier by the Department of Highways, then

returned to the municipality, then sold to the Department of Housing.

An internal recommendation was that the municipal land should not be

purchased for anything above the 1965 valuation of approximately $7,000

an acre. The Department of Highways, however, was persuaded to return

the land to Burnaby for nothing, who then asked and received the 1975

valuation price of $40,000 an acre. The transaction was approved by the

former Minister of Housing.

HON. W.N. VANDER ZALM (Minister of Human Resources): Shame!

HON. MR. CURTIS: It's very clear now that this project,

designed to yield 1,370 units, was overdesigned and the density was

much too low to meet any target of generating affordable housing

without a very significant write-down or loss, not by

[ Page

427 ]

the government but by the people of the province of British Columbia. The density

has worked out to 5.6 per acre, and parks and school sites account for 44 per

cent of the total land in the project. The bare development per unit, at approximately

$4,500 per acre, is actually not that bad, but when we add in architectural

fees and other costs it amounts to about $7,000 per unit. Further, the project

has resulted already in payment of at least $1 million in consulting fees. Seventy-four

acres of the 244 acres were purchased at an average of $50,000 an acre.

Now if we use this as the value of Crown land and assume a realistic $9,000

per unit, the project could lose $10 million. If a pessimistic value is realized

— that is, $6,200 an acre — the loss would be $14 million. That's housing

at any cost, Mr. Speaker.

HON. MR. VANDER ZALM: Shame!

HON. MR. CURTIS: There is one key paragraph in the

summary

prepared for me with respect to Burnaby-200: "Careful scrutiny of the

files in our office indicates that in the initial stages of this

project no meaningful controls were exercised."

Mr. Speaker, the list goes on, again setting out the problems with

which this ministry has wrestled as a result of decisions made prior to

December, 1975.

Riverview: a runaway locomotive in terms of escalating costs, recognized in

the housing industry in British Columbia as a classic example of lack of skilled

government management and careful cost control.

Roy Road in Saanich: a project in which the hon. second member for Victoria

(Mr. Barber), before the commencement of this session, took great delight in

referring to as "underwater housing."

Somehow, however, the member, Mr. Speaker, neglected to observe that

the provincial expenditure for Roy Road — to use his term, "underwater

housing" — was on April 30, 1973, up to and including December, 1975,

when the provincial expenditures on this project include just under

$81,000 made under the federal-provincial agreement, and almost

$397,000 funded solely provincially. That is a total expenditure of

$478,000 on Roy Road underwater housing before the change of government.

The second member for Victoria often speaks of a fairness and

reasoned thinking in this House. I would have thought that he would

have been a little more objective in his criticism. He talks about

community relations and understanding various problems. It would have

been nice to have seen an objective position taken by the second member

for Victoria in terms of the decisions and commitments made for the Roy

Road project by the former government, the a party of which he is now a

member.

Mr. Speaker, Burke Mountain, the northeast sector of the Greater Vancouver

Regional District: a total of....

Interjection.

HON. MR. CURTIS: Mr. Member, I've heard the interjections.

The criticism which was launched against this government within

recent weeks neglected to observe, through you, Mr. Speaker, that this

project was initiated during the former government's regime. Now fair

enough: criticize if you will, but recognize that it is an inherited

project, an inherited problem, that somehow was left out.

Burke Mountain: a total of $20 million for the purchase of 2,600

acres, working out to about $7,700 an acre. Again, this is not a bad

price if all of Burke Mountain could be developed. The ministry knows,

and I must tell the House right now, that we could not sell the land

for the price paid for it. But with care, skill and a watchful review

of all aspects, we think it can be scaled down and integrated with the

entire growth strategy for the northeast sector of the Greater

Vancouver Regional District — this instead of another socialist

government decision made in comparative isolation and in a great hurry.

Tantalus Village in Squamish: here, Mr. Speaker, instructions for

development were based on growth projections for increased employment

at the Railwest car manufacturing plant and related railway activities.

If I am incorrect I hope I will be corrected by the former minister,

but from all available information it appears that somewhere midway

through the Housing department's plans for this project, the British

Columbia Railway cut the projected work force in Squamish in half but

did not bother to communicate that vital information to the Department

of Housing. Port Hardy and Prince Rupert mobile-home parks: no detailed

cost estimates; no feasibility studies; no pro forma; no accurate,

useful soil studies. Today in Prince Rupert the market is estimated at

about $12,000 for a mobile-home pad. The inherited cost of the

province's project in that city is $21,000 per pad. After months of

work, after sorting through a lot of material, after countless hours of

evening and weekend overtime by many members of the ministry's staff,

we have just now received a detailed, accurate report on all land

controlled by the ministry — for what reason I don't know.

In the first years of its life, the Department of Housing was

involved in all sorts of land exchanges in various forms with no

central records kept. The department was created in November, 1973, and

the Act at that time made provision for the housing fund, but no

attempt was made to set up records for it until about one year later,

in September, 1974. Again, in the initial stages there were no records

of housing commitments, either in total or by programme.

[ Page 428 ]

Admittedly, the first attempt at this was made when the 1975-76 estimates were prepared.

In housing, Mr. Speaker, as in so many other matters which we have

examined as a new government, the philosophy of the former government

was: "We can do it all. We can do it best. We don't need anyone's

help." How wrong that has proven to be! That assumption was grossly

incorrect.

To repeat, Mr. Speaker, it is not just a question of providing

housing in the Greater Vancouver Regional District, in Burnaby, in Pitt

Meadows, in Prince Rupert or wherever it may be. Again, the methods

which resulted in a lack of clear fiscal accountability....

Real costs were hidden, not deliberately, through sloppiness. The ministry will not tolerate that now.

This ministry's relationship with HCBC, formerly Dunhill, has been

completely restructured, tightened and strengthened, in order that no

costs to the public can go unidentified. Similarly, where HCBC

undertakes a project and competes effectively in the marketplace, the

financial statements produced later on the floor of this House will

accurately reflect its success.

Mr. Speaker, developing large tracts of land by big government, i.e.

the province, and then leasing that land to individuals who we know

would prefer to own their own land creates economic consequences that

are staggering in terms of dollar requirements by government. This was

recognized very early on by CMHC during the life of the former

government. CMHC was moved to restrict its lending to this province for

land developments which were to be leased for five years. That alone

should have been a signal.

CMHC was concerned, and when the feds are concerned about spending money, someone here should really take note. (Laughter.)

Housing at any cost was a conscious decision, possibly justified to

a certain extent in a period of housing shortage. However, I find and

this government finds unacceptable the concept of housing at any cost

and with no knowledge of that cost.

Programmes and projects were conceived in a highly inflationary

period. We see that now, in hindsight: families who could afford

housing were literally bidding for homes. That's a matter of record.

Apparently the former government did not recognize that housing supply

and demand is cyclical and has been for generations. Many homes or

dwelling units purchased in that period of 1973 to 1975 are now the

subject of concern, even within recent days. We see examples of family

overcommitment in terms of shelter. We see attrition of equity and a

resultant higher foreclosure rate.

Well, Mr. Speaker, so much for the problems of the past, for those things that

have demanded a tremendous amount of attention in 12 months. They are one by

one by one, I hope, being resolved but not without difficulty and not without

substantial cost to the taxpayer. We are still attempting to put it all together.

Where from here?

First, Mr. Speaker, to restate a very fundamental fact, this

government's commitment is to the provision of a variety of housing for

our citizens, present and future — ownership, rental and senior

citizens' accommodation. But rather than attempting to do it all on our

own and identifying ourselves as the only experts in town, we want to

assist in the delivery of housing through the private sector in

cooperation with local governments, and, where absolutely essential, by

government initiative alone.

Secondly, it is to recognize that the delivery of housing does not

necessarily mean building houses. Instead, we see it as our job now in

the ministry to do these things: establish residential standards;

establish a uniform and readily understood series of regulations;

examine and encourage innovative forms of housing; increase the

efficiency of the private sector — and they can improve their

efficiency; respond to the strong citizen desire for ownership without

overlooking the needs of tenants and seniors. In other words, it is to

make certain — so very simply — that the consumer has a choice of

shelter.

The change in emphasis is working. Preliminary figures indicate a

record year for urban housing starts in British Columbia during 1976.

Those urban starts totalled 29,750, an increase of 4 per cent over the

previous record year of 1973, an increase of 12 per cent over 1975. Of

particular note in this area is that metropolitan Victoria exceeded its

previous record year by 6 per cent. Although metropolitan Vancouver

will not have a record for 1976, starts were up 25 per cent in 1976

over 1975. When final figures are available it is anticipated that

total starts for British Columbia, urban and rural, could set a new

record out of 1976.

In regard to the type of housing units being built, it should be

pointed out that only 28 per cent of the units started in metro

Victoria for the period January to November, 1976, were single-detached

houses. In 1975, 37 per cent of the starts were single-detached. The

percentage of single-detached starts in metro Vancouver has remained

stable at about 50 per cent over the last two years. For the province

as a whole, single-detached starts continue to represent between 55 and

58 per cent of all starts.

The current upturn in housing production began in mid-1975 and

appears to have coincided with a decline in British Columbia's

population growth rate from 3 per cent to about 1.3 per cent. This

reduction in growth has been the result of a severe decline in the

migration of families from other provinces as well as a decline in

international immigration to British Columbia. Traditionally in years

prior to that, British

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Columbia had a net gain of about 3,000 to 4,000

families per year from other provinces. In 1975-76, in fact, there was

a small net outflow of families from the province. Partly as a result

of this reduction in demand, we've seen vacancy rates increase and the

inventory of newly completed, unoccupied dwelling units in metro

Vancouver and metro Victoria is at well over 3,000 units.

In addition, as all members will know, house prices have stabilized

over the last several months. With the decline, therefore, of new

housing demand and the present high level of building activity, we're

quickly catching up on a backlog of demands for housing. But we may be

on something of a plateau and the demand could increase again. It is

difficult to know exactly when the backlog demands will be satisfied. A

possible indication would be a sudden increase in the inventory of

newly completed, unoccupied dwelling units, followed by a decline in

the level of building activity. Whether this will happen in 1977, no

one can say this early in the year, particularly when the fall in

mortgage interest rates is presently reinforcing the demand — and I'm

delighted to see it — by bringing home ownership within the income

range of lower- and middle-income families. A reasonable forecast, this

early in the new year, for housing starts of all types in British

Columbia during 1977 would be 32,000 to 33,000 units.

Mr. Speaker, the key to this government's housing policy, announced

and debated during the 1975 election campaign and now well underway,

relates to the identification, designation and disposition of Crown

land suitable for housing throughout the province. I can tell you that

the activity is proceeding rapidly, with highly satisfying and

encouraging results. We're very encouraged by the response not only

from the potential consumer — some of them are extremely anxious to get

going — but local government as well. Detailed compilation of Crown

land inventory is still in progress. But a preliminary estimate of

Crown acreage within the boundaries of incorporated municipalities in

this province suggests a figure of 550,000 acres suitable for housing.

Only a portion of that land is developable in the immediate future, and

those half-million acres do not include the very large tracts of land

that lie beyond municipal boundaries and that have been identified as

adjacent to, but outside, the boundaries of municipalities. That land

will also, in many instances, ultimately be available for housing

development. I quote the figures without in any way counting

agricultural land, land that is frozen for one purpose or another, and

Crown land that is free but needs to be serviced, can be sold and can

be developed for housing present and future people of British Columbia.

Now this is a major undertaking in this ministry, and I would like

to express my appreciation to the Minister of Environment (Hon. Mr.

Nielsen) and to his staff, as well as staff in Municipal Affairs and

Housing, for the tremendous effort that has gone into this concept,

because a great deal of work has had to be done.

Most importantly of all, we see no reason at all why first lots

under this government's Crown land housing programme cannot be

available for sale as early as this fall, 1977. Our rural subdivision

programme progresses well. Representatives of the ministry have

visited, I believe, every regional district — they may have missed one

— and we expect to process the first four development proposals with

regional districts within a few weeks.

Again, Mr. Speaker, we as a government were elected in this province

because we believe that private initiative — private enterprise — is

one of the greatest resources our society possesses. Nowhere is there a

clearer example of the truth of that proposition than in my ministry.

Early in 1976 I announced an assisted-rental programme in conjunction

with the federal government. The programme represents the happy

combination of private financing, private initiative and government

assistance, research and subsidies. The programme is based on the

theory that, if people are given a reasonable financial incentive, they

will respond in the public interest.

The NDP struggled to produce just over 1,000 units of rental

accommodation in their last two years in office. The new

assisted-rental programme will result in the commitment of 4,000 rental

units in this province in one year — more than had been built by

private enterprise and government over the last three years. The limit

to the number of units created will be set — logically, obviously — by

the marketplace, continuously monitored by government, financial

institutions and investors.

I'm also pleased to announce, Mr. Speaker, that in spite of all this

activity, the housing fund, after this new fiscal year, is designed to

no longer require new capital injection from consolidated revenue. To

repeat, sales proceeds from our existing portfolio of assets, land

improvement, serviced land, and so forth, and the revenue from the sale

of Crown land for residential purposes will place this government in

the position of requiring no further new capital from consolidated

revenue for housing production.

Mr. Speaker, in my earlier remarks I brought into serious question

the methods employed in the first years of the Housing ministry under

the socialists — not the motivation, but the methods. With respect to

fiscal control I referred to a much tighter and more responsible

relationship with the Housing Corporation of B.C., formerly Dunhill. In

addition, I've given highest priority to the immediate improvement of

our management and accounting procedures to ensure that public dollars

in this ministry are used in the most responsible and

[ Page 430 ]

productive manner possible.

I totally reject the proposition that big government does its best.

It does not. What big government does best is create the climate, the

environment in which local governments and the private sector can

successfully produce a variety of affordable housing for the citizens

of B.C.

Mr. Speaker, two major changes contained in the 1977-78 budget for

the ministry are not readily apparent to members. Both are of special

interest and, I hope, assistance to local governments and, again, they

underscore this government's philosophy.

We are correcting the inequitable and inappropriate cost levied

against eight municipalities and all components in the Greater

Vancouver Regional District in subsidizing provincial rental housing.

We have in the past penalized those communities which have historically

participated with other levels of government in production and

operation of government housing. In reality we have been penalizing the

good guys. The communities to be immediately relieved of this 12.5 per

cent share of operating subsidy are: Cranbrook, Dawson Creek, GVRD

components, Langley district, Port Alberni, Prince George, Prince

Rupert, Saanich and Victoria. The 1976 municipal share of operating

subsidy, when finally calculated, would have been about $850,000 to

$870,000. Projections for 1977 amount to about $907,000. That subsidy

will, from now on, be carried entirely by the province.

Mr. Speaker, I've continually referred to the responsibilities of

municipalities to accept a fair share of growth to house today's

citizens, our sons and daughters and our new arrivals. But this cannot

be a one-way street for we recognize the heavy municipal costs

associated with that growth.

Members are aware that last year I announced a provincial grant to

municipalities of $500 per eligible dwelling unit. I'm also pleased to

announce, Mr. Speaker, that this grant is doubled to $ 1,000 per unit,

effective next Tuesday, February 1. The importance of this will not be

lost on members or our colleagues in local government when it's

recalled that the federal grant of $1,000 for qualifying units, coupled

with this doubled provincial assistance, will now generate $2,000 per

new approved dwelling unit in British Columbia. I emphasize that

application for this grant is based on a building permit issued, and

the grant will be paid on completion of the unit.

This government recognizes the financial difficulties with which local government

wrestles every day. We ask for their cooperation, and we offer very significant

financial assistance, a doubling of that grant, as part of our recognition

of the overall problem.

In the fiscal year beginning this April 1, Municipal Affairs and

Housing will provide a total of $140.7 million in financial assistance

to B.C.'s municipalities and regional districts. This represents an

11.7 per cent increase over the corresponding figure in last year's

budget. I'm proud to say that this government's programme of financial

assistance to local government is, in the new fiscal year, the largest

in the history of this province. The local government grant,

traditionally known as the per capita grant, is the largest single

component of British Columbia's municipal grant structure. The total

funding to be distributed through the per capita grant this year will

be $68.3 million. Such a large sum bears, I think, compelling witness

to this government's firm belief in generous levels of unconditional

funding for municipalities.

The initial distribution of this year's per capita grants is based

on preliminary 1976 census figures received from Census Canada. When

later figures are received later in the year, that revised data can be

used to adjust the grants. Judging from preliminary indications, very

few municipalities have experienced slight decline from the 1971 census

populations on which the local government grant has been based for the

past five years.

Mr. Speaker, we are going to do a number of other things for local government:

financial compensation allocated to municipalities experiencing growth in the

last five intercensal years; provision has also been made in the ministry's

budget for an increase of $3.2 million in homeowner grant payments. The homeowner

grant is admittedly not a direct transfer to local government, but the tax relief

it provides to citizens helps considerably in lightening the tax property load.

This government has enriched the value of the homeowner grant for seniors as

a social policy instrument.

Grants under the Sewerage Facilities Assistance Act will be

increased by $4.6 million to $15.6 million. The infusion of funds here

will sustain a very important, albeit costly, programme for the

province. An additional $4 million will be pumped into the interim

revenue-sharing programme, raising its value by 13-1/3 per cent to $34

million.

In detail, the interim revenue-sharing programme for the new year

breaks down as follows: Municipalities and regional districts will

receive a basic grant of $30,000; provincial commitments to

water-facilities assistance will increase by $1 million, to a total of

$4 million; the municipal incentive grants of which I spoke earlier;

and then there is the additional $100 lower-density incentive grant

through the municipal affairs

section of the ministry.

The largest programme of all in the total revenue sharing, of

course, is the relative sharing grant that will benefit municipalities

to the tune of $22.5 million this coming year. Fifty per cent of this

total, which has grown by $2 million over last year's allotment, will

be distributed on the basis of relative operating costs, and details

will be sent out to local

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government within the next few days.

Although we recognize increasing financial pressure on local

government and its taxpayers and have responded to that situation, I

cannot close without referring municipalities and regional districts to

this year's provincial call for restraint. The demand for more and

improved local services is always present in a council chamber or in a

regional board office. I urge municipalities, as they sit down in March

and April and early May to work out their own budgets, to pare wherever

possible, particularly in terms of non-essential activities.

Mr. Speaker, in the last few minutes I've attempted to give the

members of the House a lot of numbers and I've described a lot of

programmes. The purpose has not been just to pile up statistics, but to

substantiate what is already becoming evident to many: that in terms of

housing we are correcting the problems of the past and moving forward

from there, and that this government's record of municipal assistance

is, and will be, the best the province has ever experienced, and this

year is only the beginning.

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

one note to make. I have been approached by a number of backbenchers who want

to learn by experience how to get into a cabinet, and since I'm not able

to give the time to counsel everyone individually, I thought that the best thing

I could do is to give them the advice across the floor of the House when cabinet

ministers wouldn't be around. They don't stick around for the debates

— a few of them do and I'm going to talk about that — but for the rest of

you, the only advice I can give is this: I've given it a great deal of thought

and I've come up with one conclusion. Your problem is you all joined one

party at the wrong time. What you have to do is quit Social Credit, join the

Liberals and then renounce your new faith. Come back in that way and you make

it into the cabinet.

Now some of you fellows have made the mistake of actually joining

Social Credit, thinking you had a chance for the cabinet that way. But

it's not the way it works, fellas, and since I haven't got the time to

handle each one of you separately, the best advice is: join the

Liberals first. The odds are, on a Liberal background you've got a

better chance.

Now the Minister of Energy, Transport and Communications (Hon. Mr. Davis),

the Minister of Education (Hon. Mr. McGeer), the Minister of Agriculture (Hon.

Mr. Hewitt), the Minister of Labour (Hon. Mr. Williams), the Attorney-General

(Hon. Mr. Gardom), the Minister of Human Resources (Hon. Mr. Vander Zalm),

the Minister of Housing (Hon. Mr. Curtis) — there it is, gang. It's obvious.

Some of you've made the mistake of belonging to that party for years, like

the member for Omineca. It's his second time around and he used to be a

cabinet minister. I don't know why he's not in the cabinet now. The

only conclusion I can come to is that he wasn't....

Interjection.

MR. BARRETT: Skeena now. Whatever happened to Omineca?

Interjection.

MR. BARRETT: Yes, Omineca. Well, where he made a mistake was he switched ridings, not parties.

AN HON. MEMBER: So did you.

MR. BARRETT: That's his problem. Be careful, Mr. Minister of

Mines (Hon. Mr. Chabot) . You just made it, Mr. Minister of Mines. One

of the old guard and you just made it because there was a spot open. I

understand that it certainly wasn't based on anything other than a flip

of a coin. So I just want to tell you that I can't spend any more time

with the backbenchers. That's the best advice I can give them.

AN HON. MEMBER: If you can give them advice how to get in you can also give them advice how to get out.

MR. BARRETT: I certainly can. You keep on opening your mouth,

Mr. Member, and you'll get out in a hurry. You certainly will. And I

have a special complaint that I'm going to take up with you separately.

As my MLA, you're a flop. But I don't want to raise that here; that's

taking undue advantage.

Mr. Speaker, I want to talk a little bit about the cabinet

ministers. I want to say how much I appreciate some of the cabinet

ministers who take their duties in this House very seriously. I want to

particularly thank the Minister of Energy, Transport and Communications

(Hon. Mr. Davis) for sitting through all of the opposition criticism on

that particular department. I think that it's very important for

ministers to show that amount of, frankly, courtesy to the official

opposition and a degree of responsibility. I want to thank the minister

for doing that.

The other ministers, Mr. Speaker, can gauge their own attendance in

the House. We understand how busy the cabinet is, but I think it is

important that an effort should be made, and it has been made by that

minister, to be in the House when the opposition spokesperson is

speaking on that particular ministry.

I have a few comments to make about the Minister of Municipal

Affairs and Housing (Hon. Mr. Curtis), but he's gone, It's interesting

to hear the Minister of Municipal Affairs and Housing attack the former

[ Page 432 ]

Minister of Housing. I

was in this House for years when Social Credit did absolutely nothing

in the field of housing. That minister suffered all the pangs of birth

of the programmes that he brought in, including the purchase of

Dunhill that was attacked in the most irresponsible manner by that

member and other Social Credit opposition members. After that minister

bearing the pangs of birth, we hear a sanctimonious statement by the

minister who is not enjoying the child. If it hadn't been for the hard

work of that minister, none of those programmes would have got off the

ground — none of them. He didn't inherit a department that had a

philosophy or a commitment to public housing. He inherited a zero — a

blank. The problems we faced in terms of the fact that there was no

housing in this province related to the earlier Social Credit lack of

activity.

I also want to make one other comment about that minister, and that

is not a single word about the senior citizens of this province. He

didn't mention to this House that there's been a cut from $10 million

to $4 million for senior citizens' housing. He didn't mention that at

all! There are 8,300 senior citizens in this province waiting for

housing. The news they get from Social Credit is that the amount of

money to be spent on them is cut from $10 million to $4 million. The

human tragedy of elderly couples faced with the need for accommodation

is highlighted by other problems, but certainly in their golden years

one would expect that they would have the priority of this government.

That is not the case.

MR. D.G. COCKE (New Westminster): Well, they're not millionaires, of course.

MR. BARRETT: Of course they're not millionaires. They made it

possible for other people to become millionaires, though, Mr. Member,

and we do have a moral obligation to these people.

Mr. Speaker, I'm going to divide my speech into two 19½-minute

parts. I'm going to talk about these three pages out of the budget,

because this is where the false story of the budget is told. Now I

would never use unparliamentary words, Mr. Speaker, like the member for

North Vancouver–Capilano (Mr. Gibson) who said it was a flim-flam

budget. Even though I agree with him that it is a flim-flam budget, I

would never use the words "flim-flam" in this House. Therefore I'm just

going to say that it's a false budget. I'm not going to say the speech

is false, because that would be putting something on the minister that

he might not want to identify with. But if we turn to page 10, Mr.

Speaker, what do we find? We find that the minister says, at the bottom

of page 10:

"Our forest products industry should show continued improvement,

particularly in lumber exports to the United States, where housing starts are

expected to rise from a level of 1.5 million units in 1976 to 1.8 million units

in 1977."

Now, Mr. Speaker, let us take a look at how this reflects in

estimated revenue. We are told by the minister — who is not, I'm sure,

fibbing to any one of us — that there is going to be an increase in the

forest industry. Shall we assume that it's going to be a modest

increase? Mr. Speaker, let us examine what the budget says in terms of

the revenue from the increase. If there's going to be an increase in

sales, is it not logical to assume that stumpage fees will go up, and

we get more money in stumpage fees if we're selling more timber? Is

that logical? Is it logical to assume that if we're selling more lumber

the tax on the forest industry would go up? Is that correct to assume

that?

AN HON. MEMBER: Correct.

MR. BARRETT: One could assume that if they're boasting that

there's going to be a modest increase then it would reflect in figures.

Now somebody is not telling the Minister of Finance the truth. I don't

know who it is, but someone is not telling him the truth, because after

he made that statement we find on the first three pages of the budget,

under revenue, the following information: the logging tax in 1977 was

estimated to be $27 million. With an increase in sales the logging tax

drops to $10 million, and they're expecting 60 per cent less. Now how

can more sales mean less money? Is that Social Credit monetary theory?

Now the next thing: timber leases are not related to revenue, but

they're down. Timber revenues are not necessarily related to the great

markets. But the next one is timber royalties. It says on page 10 that

we're going to sell more. Timber royalties: $8 million in 1976; $7

million in 1977. How can you sell more and make less?

But this is the most revealing figure of all to prove the case that

someone has not told the truth to the Minister of Finance. Timber

sales: that is the amount of money that we get back directly related to

the sales of timber internally and on the export market. If they go up,

our revenue goes up; if they go down, our revenue goes down. Is that

correct, Mr. Member for North Vancouver (Mr. Gibson)?

Interjection.

MR. BARRETT: Yes, it's complicated. Your father would have said it far more clearly, but Harvard kind of messes things up. (Laughter.)

If the sales go up, the revenue to the Crown goes up. In 1976 the

estimated revenue was $80 million, although I expect that the real

revenue will be around $65 million to $70 million, as the minister

quoted on

[ Page

433 ]

television just last night. I watched him after supper. Do you know

what it is? It's down from an estimate of $80 million to $50 million.

MR. G.R. LEA (Prince Rupert): More legislation to come in.

MR. BARRETT: There is 37 per cent less revenue expected after

they tell us in the budget speech that our forest products industry

should show continued improvement. Somebody has lied to the Minister of

Finance, and I want to know who it is. No one should be permitted to

embarrass the Minister of Finance in this manner. I think it is

absolutely wrong that the minister has been placed in this position. I

hope that he finds out who's been doing this to him.

He says in the speech that the other areas are going to do well too.

On page 11: "Increased Japanese demand for British Columbia mineral

production, particularly copper and coal, is forecast. Coal should have

volume and value increases of more than 20 per cent in 1977." A ton of

coal sells for close to $50 a ton.

lnterjection.

MR. BARRETT: Well, let's say $50 a ton, Mr. Member. It's

going to have a value increase in one year, according to page 11, of 20

per cent. That means another $10 a ton value increase. Is that correct?

It will be, very roughly, $10 a ton more, according to this statement.

Now what does that mean? That means that if you believe this page,

that should be reflected on this page: "Revenue." But what do they say?

Somebody has been lying to the minister, Mr. Speaker, because this is

what they tell us. Even though there is going to be an increase of 20

per cent in the value of coal, we find that royalties, including coal,

are going down.

MR. COCKE: They're a bunch of bunglers.

MR. BARRETT: How about that? I have been worried about this

for a whole week. I can't tell you how much it embarrasses me to have

to raise the fact that somebody has lied to the minister, given him two

different statements to make and made him look foolish.

MR. LEA: They're rolling back the economic speedometer.

MR. BARRETT: He works hard enough at it himself without someone else

putting the words in his mouth. The minister has been given false information

in his budget speech because his revenues don't bear out what he's been

saying. I think we should give him a chance to go back and rewrite it. He should

be given that chance. No one should be placing that minister in that position.

Royalties are going from $12.8 million down to $5.3 million, a drop of 58 per cent.

MR. C. BARBER (Victoria): Shame!

MR. BARRETT: Petroleum and natural gas royalties: down from

$275 million to $245 million. Why, they tell us that production has

never been greater in natural gas!

Mining tax was $15 million last year; this year it will be $11 million, down 26 per cent.

Mineral land tax, $15 million last year, will be $9 million this

year, down 40 per cent; mineral resource tax will be $11 million this

year — there was none last year. That is a net difference, Mr. Speaker,

of a loss to the Crown of $36 million — $36 million less in tax money

back to the people of British Columbia. At the same time, he's telling

us that increased demand for mineral production, particularly copper

and coal, is forecast.

Along with that $36 million that could go to schools, hospitals,

roads, bridges and anything else, including jobs and people, is the

fact that since April, 1976, a $1-a-ton royalty more on coal, that was

supposed to have been paid and it was agreed by the former Minister of

Mines sitting over there that the mining companies could pay, has never

been collected. From now on only the people sitting in this Legislative

Assembly should know this, because other people in this province are

going to get angry if they find out that the coal companies haven't

been asked to pay a tax that they were ready to pay. We will have

line-ups at the ferries, with people saying: "Look, I understand the

rate has gone up but I don't want to pay because I want the same

approach as the coal companies. You just put the price up but just give

me a wink and a nod and tell me I don't have to pay when I go on the

ferry."

MR. W.S. KING (Revelstoke-Slocan): The giveaway gang.

MR. BARRETT: No, it's worse than a giveaway, Mr. Member. It

is embarrassing to the Minister of Finance who has been given two sets

of books by somebody, and I want to know who it is who has embarrassed

that minister this way. No minister of the Crown would ever dare to

author this document himself. It was done for him and he put his name

to it. Well, I don't know who it was. I don't know if it was the

Premier or who it was, but back to the drawing board. How can he say

one thing on pages 10 and 11 and say something else on the estimated

revenues?

Now another thing I don't want to get out of this House, Mr. Speaker, is who's paying taxes in this

[ Page 434 ]

province? There's going to be a tax revolt around this province if

they find out who is getting skinned. While the oil companies and the

mining companies get away with murder, and the millionaires get away

with murder, guess what's going on in his books with the ordinary

people? If you don't correct it, Mr. Minister, I may have to go around

this province and tell the people. And I want to give you some time to

straighten up and fly right. Let's take a look at what's happening. Let

us examine what the poor working people, including the press gallery,

are asked to pay for, Mr. Speaker — even the working press, who

struggle through these figures day and night to come up with the truth,

so that they will be printed on the editorial pages of the Vancouver

"Fun" and the Vancouver "Pravda"...I mean Province .

The corporate income tax: Is there anybody here on this side of the House who pays corporate income tax?

AN HON. MEMBER: No.

MR. BARRETT: No, you're in the wrong category. If you incorporate yourself.

MR. J.J. KEMPF (Omineca): An attack on the press.

MR. BARRETT: An attack on the press? No, on the editorial

pages of the press. The rest of the press is okay, like putting

classified ads where there should be provincial news. (Laughter.) You

know, you've got to fill up space.

Corporate income tax, 1977: $251 million. How about a little wink

there, all you corporation owners over there. You know what's

happening, don't you? Don't smile when I get to this part. In 1977, the

corporations paid $251 million; 1978, $283 million — an increase of 12

per cent. The corporate capital tax: $35 million, down to $33 million —

a 5 per cent drop in tax! The mining companies have had a drop in there.

Personal income tax — that is the rest of those people out there who

don't pay attention to politics or to the big high finance of budgets.

Guess what they're going to get socked with, gang. Personal income tax

in 1977: $815 million; in 1978 $1.1 billion — an increase of almost

$300 million or 36 per cent in one year. Oh, wait, wait, wait. Before

they all go rushing out challenging those figures: Yes, there is going

to be a new transfer system of points of income tax back to the

provincial government. Yes there is. And, yes, I'm using percentage

figures on a relative basis.

Two points I want to make: One is that the gross figure I'm quoting

on personal income tax is much higher — three times higher — than the

corporate income tax, so if I am using relative figures on a percentage

basis it's to the advantage, on a comparison, to the smaller figure.

Then I go on to point out that, yes, there is a transfer, but overall,

of 36 per cent.

Let us assume, for advantage of argument to the government, that 16

per cent of that increase comes from the new transfer. It means that in

one year they are anticipating an increase of 20 per cent in the

revenue from income tax because of the four points they put on last

year and burdened the poor working people of this province — and the

reporters and others — while the corporations are smiling all the way

to the bank. Then we hear that minister say to this House: "Oh, but we

need another method of financing." I don't think they need another

method of financing; they've been given gifts by this government —

gifts by Social Credit.

To base it even further, if the minister was really concerned about

financing, I would recall to him that in this very House we passed

legislation permitting us to go into our own financial institution.

Now, Mr. Speaker, somebody is attempting to embarrass the Minister

of Finance again. Mr. Minister, you have on your desk, and have had on

your desk since February of last year, a report prepared by the credit

unions of British Columbia to assist in the development of a new

financing method for business and individuals in this province. To come

in here and decry the fact that there is no alternative financing

method when you've kept that report secret on your desk is shameful,

Mr. Minister! Absolutely shameful! You've kept that report secret,

which was an opportunity for the government of British Columbia to go

into alternate financing for ordinary citizens at less than exorbitant

interest rates. Will you be ripping out pages 10 and 11 in your

speech, or will you be changing the revenue estimates?

You know, Mr. Speaker, just two days ago I spoke to an elderly

gentleman who has observed Social Credit for some 25 years. I asked him

if he was a masochist — but he denied it. He's observed them for 25

years and he said to me: "Do you know what this budget is, Mr.

Barrett?" I said no. He said: "They found this one in W.A.C. Bennett's

old files. They dusted it off, and brought it back." They delivered it

as their own because they may be deliberately underestimating revenues

only to build up a surplus at the expense of programmes to the people

and have the minister come in next year, stick his thumb in the pie and

say: "Oh, what a good boy I am!" They are using that minister in a

manipulative way that I find absolutely embarrassing.

Then they went further, Mr. Speaker, to suggest to him that deficits

should be avoided at all costs, and he spent some time talking about

that. What a direct threat on his own business, if he only sold cars to

everybody who had cash. It can't be done! That's no way to treat a

minister. That's no way to push him

[ Page

435 ]

around. That's no way to foist those kinds of archaic ideas and

double statements on an honourable gentleman like that minister. Who

would dare do that to him? — have him say one thing and then the

figures prove something else.

MR. LEA: How much do you get for a used province?

MR. BARRETT: Well, I don't really know. But it embarrasses me

to think that a minister of the Crown has been so badly used. I think I

can express nothing but compassion for that minister.

There is, Mr. Speaker, a deliberate underestimation in this budget,

based on no increase in revenues at all from the projections of last

year. There is a deliberate underestimation of $125 million that they

should be collecting, which they will not be or will be partly

collecting — $125 million necessary for the economic stimulus of this

province, which the very minister talked about. That will not be

available.

[Mr. Veitch in the chair.]

I find that small comfort to the 92,000 people who are unemployed in

this province; and I find it small comfort to those young married

couples who are driving by the empty new homes that the Minister of

Housing is boasting about; and I find it small comfort to those people

who are driving by the used-car lots with now double problems: not only

do they wonder whether or not they're getting a good deal, but do they

have the money for it in the first place?

One of the most hypocritical things in the speech relates to

tourism, and again the minister has been embarrassed. Whoever wrote the

throne speech said that vehicle traffic was up all over British

Columbia, except on Vancouver Island where you can't bring a vehicle

because it costs you an arm and a leg.

MR. D.F. LOCKSTEAD (Mackenzie): And the Sunshine Coast.

MR. BARRETT: And the Sunshine Coast. But vehicle

traffic was up everywhere in this province. For a vehicle to travel in

this province it must have gasoline. Has there been a reduction in

gasoline tax, Mr. Speaker? Not to my knowledge. Gasoline prices are

going to go up, and the Minister of Energy, Transport and

Communications (Hon. Mr. Davis)...I don't know what he said in the

hallway, but I can bet you he said: "I ain't going to stop it." Did you?

HON. J. DAVIS (Minister of Energy, Transport and Communications): Blame the feds.

MR. BARRETT: Blame the feds! Whooee! (Laughter.)

MR. BARBER: Don't tell Pierre that! You are the feds!

MR. BARRETT: Mr. Speaker, I'd ask you to clear the galleries

because what I'm going to say next will only be embarrassing to the

public. He's blaming the feds when we are one of the provinces that has

legislation to control that increase, and all he has to do is give a

wink and sign his name to an order-in-council keeping those prices

down. And he's blaming Ottawa!

All the reporters put their pens down. I don't want that word to get

out to the people that he has the power to save them that money,

especially in northern British Columbia, where a certain member has

made a whole career on gasoline prices only to get smacked on the head

again with another three cents.

You promise to support an increase in the price of gasoline of 10

cents a gallon, my friend, and you'll make it to the cabinet. Just tell

them you agree with another dime on a gallon of gas, put in your time

in the cabinet and fade out of public life, and you'll coast, partner —

through you, Mr. Speaker.

Vehicle traffic is up! Estimated revenue from gasoline tax in 1977

is $175 million. If vehicle traffic is up, that means more gasoline is

sold. What is the estimate for gasoline tax collected because more

vehicles are on the road? Why, we find an amazing thing! While there is

more vehicle traffic and more gasoline sold, the estimate for the

amount of gasoline tax has gone down.

MR. KING: How about that!

AN HON. MEMBER: That's flim-flam!

MR. BARRETT: Flim-flam, Mr. Member?

MR. KING: What do you believe?

MR. BARRETT: Flim-flam? From $175 million last year down to

$171 million — a deliberate underestimation so that there can be some

padding in the budget. That's what it is. That's not flim-flam, Mr.

Speaker, that's crass dishonesty, planned, deliberately conceived, and

delivered in this House!

You go around peddling the story in this province that you're fiscally responsible. Mr. Speaker, they are fiscal liars.

DEPUTY SPEAKER: Hon. member, as you are full well aware, the word "liar" is not parliamentary language. I would ask you to withdraw it.

MR. BARRETT: Well, Mr. Speaker, I said they are

[ Page 436 ]

"fiscal liars."

Now what's it going to be? I'm confused. They say one thing on one

page, and another thing on another page, and I've got to come up with a

conclusion.

DEPUTY SPEAKER: Hon. member....

MR. BARRETT: Yes, sir?

DEPUTY SPEAKER: You have been in this House much longer than I and you know full well that the word "liar" cannot be used in this House.

AN HON. MEMBER: When a member is offended.

MR. N. LEVI (Vancouver-Burrard): Which member's offended?

MR. BARRETT: Mr. Speaker, you are correct. (Laughter.) I withdraw that word. They are prevaricators.

AN HON. MEMBER: Order!

MR. BARRETT: Mr. Speaker, I withdraw that, too. In my opinion, they have not told the truth — and you know it, too.

We had the Minister of Recreation and Conservation (Hon. Mr. Bawlf)

get up in this House and say: "Poor little Charlie Barber caused all

the problems!" I have never known a 26-year-old citizen who has upset

more cabinet ministers and got more things done for his riding than

that member for Victoria. I have never seen a cabinet minister come in

and devote his first major speech on the budget as a cabinet minister,

devote his whole time, to a 40-minute analysis of a back-bench

opposition member's statements.

What's he worried about? You know that this 26-year-old couldn't

possibly match your expertise, wisdom, knowledge and acquisition of

wealth. You know, Mr. Speaker, he told us that tourism was going to

improve. How does he stand on the fact that the estimate of vehicle

traffic gasoline tax is going down?

Mr. Speaker, we see in this budget a deliberate shift from the ability-to-pay

concept to the ability to have influence. There is a new concept in taxation:

a shift from ability to pay to ability to have influence. The oil companies

have influence with that government; the coal companies have influence with

that government; the mining companies have influence with that government; the

forest companies have influence with that government; the millionaires have

influence with that government. The only people who don't have influence

with that government are the people who voted for them. The ordinary citizens

of this province have been skinned tooth-and-nail, right down to the bone, by

a government that is arrogant in office after only 18 months, and that has the

audacity to say: "We're Canadians, not socialists."

AN HON. MEMBER: Restraint! Restraint!

MR. BARRETT: Restraint! "Hold yourself in, gang, because

we've got to pay off the oil companies, the mining companies, the

forest companies and the millionaires. The rest of you are down on the

list somewhere. We'll think of it, probably about 60 days before an

election."

Perhaps the most dishonest budget that was ever presented in this

House was presented by that minister. It's not his fault; someone else

did the job. He's been used. I'm sure he has not been driven out of the

House; he's gone out to check on the figures himself.

AN HON. MEMBER: He's talking to Williams.

MR. BARRETT: Oh, he's talking to his lawyer. (Laughter.)

AN HON. MEMBER: I can guarantee you he's not ashamed.

MR. BARRETT: Mr. Speaker, this is a totally cynical and

political document. After having had these months in office, we would

have expected some leadership, some statesmanship, a statement of

philosophy, direction and goals in this province, not a kind of

hand-wringing, wistful appeal to a laissez-faire, Dickensian type of

economics — not Adam Smith, Charles Dickens. That's what's happened: an

appeal to some kind of simplistic philosophy that all will be well if

the rich will deign to give us a nod and a favour.

The old master-servant relationship that has come forward in this

government is typified by this budget. "Restrain yourself. Don't ask

for more because those of us at the trough want to have a second time

around." Millionaires — gobble, gobble, gobble! Oil companies — gobble,

gobble gobble! Mining companies — gobble, gobble, gobble! The

government is a turkey. It is a moving feast, Mr. Speaker, ready to be

carved up by every single company or individual who has influence. We

have not seen the likes of this since the turn of the century when the

CPR used to do all the skinning.

Interjection.

MR. BARRETT: Yes, Mr. Member. You yawn and feign boredom.

You're safe for another 20 months. Why, you might even fly over

Kamloops, open one of the windows in the jet, drop out a cigar butt and

say, "I'm thinking of you, folks," 30,000 feet above real

[ Page 437 ]

problems in a stratosphere of ancient history and an attitude that

rationalizes every single thing on the basis of: "Oh, after all, all

we're doing is fighting socialism." "Fighting socialism" is the

catch-word....

DEPUTY SPEAKER: Hon. member, it is my duty to warn you that the three-minute light is on.

MR, BARRETT: It can't be.

DEPUTY SPEAKER: It can be.

MR. BARRETT: The previous speaker took up all my time.

Mr. Speaker, I will try to be as brief as I can, The second 19½

minutes of my speech is now what I'm starting. In the second 19½

minutes, I want to deal with a very, very serious problem: the fact

that there is no philosophy with this government. We are moving into

very serious times in this country, not the least of which include the

threat of separation by Quebec. But let's put that problem aside for a

moment.

The real ground of problems in this country, Mr. Speaker, is a

common thread of insecurity from coast to coast in this country. A lack

of jobs, a lack of economic security and a lack of the thought of a

secure future for one's children — that is a thread across this

language. What this country desperately needs is a new direction and

new leadership by the federal government, by the provincial governments

and all the political parties. But to subject ourselves to a narrow,

silly, emotional debate on separatism, on the language issue, without

addressing ourselves to the basic economic problems of this country,

Mr. Speaker, is political failure by our leadership.

We should have from this provincial government a clear-cut statement

of philosophy on the economy of this country, on the energy policy of

this country, and the development of transportation and infrastructure

related to the development of our own resources.

I'll wrap up the last 19½ minutes by saying to you, Mr. Speaker,

that I rarely get aggravated in this House, because I have always come

to enjoy my time in this great place with a sense of humour. As great

men fumble around and events go past us, I've understood that humour is

far more important than anything else. But on occasion I lose my

humour. When I find that a government has had the opportunity to stand

up and say here in this wealthy province, with this additional revenue

that we should be collecting, "we will be providing jobs, homes,

security and retirement for our people," but instead we find empty

promises and punishment to the citizens, I lose my humour. Mr. Speaker,

I lose my humour when I begin to realize the devastating effect to

small businesses on Vancouver Island, the devastating effect to the

individual lives of tens of thousands of citizens of this province.

Mr. Speaker, where is your philosophy? For two years now you've said

you're against socialism. We know that! We're for it! The question is:

what are you for, other than the mining companies, the oil companies,

the millionaires and the privileged?

We want a government with an even hand and fairness, Mr. Speaker,

and the people of this province can't expect anything less. I'm ashamed

of you, and so is one of the newspaper articles ashamed of you. The

thing that disturbs me, Mr. Speaker, is that I agree with the

conclusion of that particular article, even though I'm ashamed of you.

After you've presented this budget it is obvious that you are shameless.

DEPUTY SPEAKER: The hon. Minister of Mines and Petroleum Resources.

HON. J.R. CHABOT (Minister of Mines and Petroleum Resources): Thank you, Mr. Speaker.

MR. LEA: Chobs! Chobs! You got your chob! (Laughter.)

HON. MR. CHABOT: It's always a pleasure, Mr. Speaker, to have

the opportunity to speak in the budget debate on behalf of the people I

represent in Columbia River. I would hope that as a rookie cabinet

minister the normal courtesies will be accorded the new minister.

(Laughter.) For the benefit of those people in the galleries, that

normal courtesy is silence when the new member is speaking.

AN HON. MEMBER: You were a rookie last year.

HON. MR. CHABOT: It's also a pleasure, Mr. Speaker, to follow

an $80,000-MLA. I've never had the privilege, Mr. Speaker, of following

a member of the Legislature who spent so much to get elected in this

House as the Leader of the Opposition.

MR. KING: Who are you kidding? What about that member? His Dad bought him a seat.

MR. LEA: He had to bring in succession duties to get elected. (Laughter.)

HON. MR. CHABOT: That figure of $80,000 does not include the payoff to one Bob Williams.

Mr. Speaker, I want to refer — and unfortunately the Leader of the

Opposition is out and he's watching the TV cameras whirl and talking

into microphones right now — to one of the speeches he made just prior

to the session opening in Halifax. He was speaking to

[ Page 438 ]

the Maritime School of Social Work, and that was some speech. It was

a speech that was untruthful. It was a speech that, in my opinion, was

irresponsible as well. You know, the Leader of the Opposition used to

be a social worker, Mr. Speaker, and I recall very vividly that when he

was the Premier of this province he used to tour the province and tell

the people: "We must have brotherly love." Brotherly love — that's what

he taught and that's what he wanted the people to accept. But that

isn't what he said when he was in Halifax, when he stated: "The Social

Credit government will not spend any money to develop resources. Things

are getting worse in the province — and I'm loving every minute of it."

HON. W.R. BENNETT (Premier): Shame!

HON. MR. CHABOT: "I'm loving every minute of it!" That was

the very statement from a man who had been the Premier of this

province, which I consider to be highly irresponsible and not in the

best interests of the people of this province. It appears to me, Mr.

Speaker, that that member will say almost anything to attempt to gain

power in British Columbia again. He's prepared to jeopardize and affect

the economy of this province by irresponsible statements.

MR. R.E. SKELLY (Alberni): What about the secret police?

HON. MR. CHABOT: He's suggesting that the people of this province should suffer more and, if they are suffering, he's happy for it.

AN HON. MEMBER: Terrible! Terrible!

HON. MR. CHABOT: It's quite obvious, Mr. Speaker, when one

examines the facts of this budget, that that member has no respect for

truth or facts — none whatsoever!

Interjections.

HON. MR. CHABOT: For a new minister you're supposed to be quiet. (Laughter.)

This is a strange session, indeed. I have been attempting to find

out what's really wrong with the official opposition. There appears to

be an air of disunity over there.

AN HON. MEMBER: Wait until Rosemary gets back.

HON. MR. CHABOT: There appears to be an air of disunity.

Morale appears to be low. They can't get their act together. They don't

seem co-ordinated. There appears to be something wrong. I'm wondering,

Mr. Speaker, whether there's a possibility of a power struggle for the

leadership of that party.

SOME HON. MEMBERS: Oh, oh! Really?

HON. MR. CHABOT: I'm wondering whether there is. I'm sure

that the people of this province are wondering, too. The people in the

galleries, when they see the disunity and the disorganization in your

ranks, are wondering what's happening over there. You're not fulfilling

the role for which you're elected.

AN HON. MEMBER: Where's Rosemary?

HON. MR. CHABOT: I'm sure, Mr. Speaker, that this will be

resolved when Rosemary returns from wherever she's at and that she'll

be able to pull the troops together and unite that party once again.

Mr. Speaker, unfortunately the member for New Westminster (Mr.

Cocke) is not here. I just wanted to make a reference to a statement he

made in the House yesterday while he was here. He's here from time to

time, I have to admit. But I never cease to be amazed at the kind of

attitudes and the kind of statements that flow from that member. You

know, he talked about private insurance companies. Mr. Member for

Revelstoke-Slocan (Mr. King), up in your riding they think you're

pretty amazing, too, in that you haven't gone back to your riding.

(Laughter.)

Mr. Speaker, the member for New Westminster suggested yesterday that

private insurance companies are flocking back to British Columbia and

that there is a gravy train as far as selling auto insurance is

concerned.

Interjections.

HON. MR. CHABOT: Mr. Speaker, the member for Prince Rupert (Mr. Lea) is another one.

Interjections.

HON. MR. CHABOT: I mention a gravy train — he's going down to a second-hand store to see if he can sell another chest of drawers. (Laughter.)

It's quite obvious that there is no big gravy train in competing

against ICBC in the sales of auto insurance in this province. That's

clearly indicated, because only one company has come to British

Columbia to offer its services or to attempt to compete against ICBC.

MRS. B.B. WALLACE (Cowichan-Malahat): To whom are they offering it?

HON. MR. CHABOT: The member opposite know full well that ICBC is geared to provide auto insurance at cost to the British Columbia driving

[ Page 439 ]

public. This is clearly reflected in the rates and rebates which are

taking place this year. You know, with the financial ability that was

demonstrated while the member for New Westminster was on the board of

directors of ICBC and the company was wallowing in debt — $181 million

of debt — if they had remained in government, that corporation, on the

basis of the information and the statements he made yesterday, would be

facing a debt load of $500 million today.

SOME HON. MEMBERS: Right on.

HON. MR. CHABOT: That former government, Mr. Speaker, has

left a legacy of debt throughout this province. If that member is not

stupid, I'm sure that he recognizes the fact that ICBC could not

continue incurring hundreds of millions of dollars of debts.

But, Mr. Speaker, I can accept some of these erroneous statements

from the Leader of the Opposition and the member for New Westminster

with a certain degree of charity. But I certainly can't accept the

irresponsible statements from the first member for Vancouver East (Mr.

Macdonald) . Last Friday, when talking about M.E.L. Paving and BCR, he

said this: "Mr. Speaker, the charge is fraud, criminal possibly, or

civil." Mr. Speaker, this member is either ignorant — and I'm sure he

isn't — of the facts in this case, or he is being deceitful or

dishonest in his

interpretation of the facts.

SOME HON. MEMBERS: Right on.

HON. MR. CHABOT: I never cease to be amazed by some of his

statements, Mr. Speaker. He goes on to speak about the need to demolish

Oakalla. Oh, it had to be razed to the ground, he said. He urged the

government to take action to ensure that it was. I recall, very

clearly, the whine 14 years ago from the former member for Coquitlam,

when he used to talk about the need for the removal of Oakalla because

of the conditions to which the people were subjected there — the drippy

cow barns, the stench. Would you believe they did nothing while they

were in government about closing Oakalla?

You talked in opposition, year after year for the last 14 years that

I recall, and you did nothing while you were in government. You stand

condemned by your inaction.

AN HON. MEMBER: Right on!

HON. MR. CHABOT: I want to thank the government for its

reduction in the sales tax on propane because I recall contacting the

B.C. Energy Commission just a couple of years ago on behalf of my

constituents in Columbia River to see if there was possibly a way in

which they could stop the massive increases in propane costs in British

Columbia. It had tripled in price in approximately 18 months to two

years, while the socialists were in office. They did nothing about it.

I advocated to the B.C. Energy Commission that they should regulate

these massive, unnecessary increases, as far as I was concerned. The

B.C. Energy Commission, an arm of the government of the day with

political appointees, Mr. Speaker, was unwilling to help the people who

were purchasing propane in rural British Columbia or anywhere else. So

I am pleased to see that the government has taken action to reduce the

tax on propane in British Columbia.

I am now pleased to discuss current activities and future activities

in the field of Mines and Petroleum Resources. I am pleased to have the

responsibility in that ministry. I first want to deal with an erroneous

statement being referred to on an almost daily basis by the socialists

across the floor relative to the punitive tax measure they imposed on

the mining industry of British Columbia.

The Leader of the Opposition (Mr. Barrett) repeatedly indicates his

government imposed on the mining industry a little 5 per cent sales

tax, the little sales tax which he indicates every working man in this

province pays, and that should be applicable to the mining industry in

this province.

MR. BARRETT: It's now 7 per cent.

HON. MR. CHABOT: That is correct. It is now 7 per cent. The Leader of the Opposition is correct.

But the former Premier is careful to evade the true facts of the

type of punitive tax measures his government imposed that stifled

mining exploration and development in this province. As an example, he

fails to talk about the super-royalties that would be applicable on

copper if it reached the price of 95 cents per pound. The super-royalty

would be virtually equal to the so-called "little 5 per cent sales

tax." With an increase in copper to $1.20 per pound, his super-royalty

would then be approximately three times the amount of his so-called 5

per cent sales tax, and would escalate very dramatically with an

increase in the value of copper.

MR. SKELLY: When did the price reach 95 cents?

HON. MR. CHABOT: A couple years ago it was over 95 cents.

Mr. Speaker, the Leader of the Opposition might be able to fool some

of the people with his fictitious

interpretation of his tax imposition,

but he certainly was not able to fool those people who found it

necessary to move to other countries and other regions of this nation

to find gainful employment in their professions.

The disruption that they caused in the three and a

[ Page 440 ]

half years his government was in office has denied British

Columbians the opportunity to be gainfully employed in the mining

industry. It has been difficult restoring confidence to this industry

after the turmoil that was generated during the socialist regime.

Coal royalties in the application of the new mineral resource tax,

which replaces the Mineral Resource Tax Act, are expected in the next

fiscal year to increase revenue in the province by approximately $4

million more than last year. Mining activity is coming back to British

Columbia after having reached a dramatic low of exploration expenditure

in 1975. As confidence continues to return, activity will further

accelerate.

Mineral claims staked in 1976 total over 28,000 as compared to

approximately 11,000 claims in 1975. Mr. Speaker, we are on the road to

recovery.

AN HON. MEMBER: Hear, hear!

HON. MR. CHABOT: Although coal production in 1976 was down

due to labour disputes at Kaiser Resources and Fording Coal,

exploration activities accelerated very dramatically in 1976, which

resulted in expenditures of approximately three times those of 1975,

which totalled $3.5 million. The main interest in coal during 1976 was

directed to metallurgical coal in the Peace River and Crowsnest coal

fields. Major exploration and development programmes are underway on

virtually all of the coal licence areas.

In the Peace River there was activity at the Carbon Creek property,

the Sukunka-Bullmoose, Quintette, Cinnabar Peak, Pan Ocean and Saxon

properties. B.C. Hydro has been continuing its studies of the Hat Creek

thermo-coal deposit as a source of electrical energy. Activity in the

east Kootenay centred around the Elco mining property at Elk River; the

Crows Nest Industries property at Line Creek; the Kaiser Resources

property at Hawsmore Wheeler, their hydraulic underground operation;

and at Rio Algom's Sage Creek property.

Activities are in various stages of development throughout the

province and 1977, hopefully, will result in decisions being made that

will result in the expenditure of billions of dollars that will

generate thousands of new jobs for British Columbians.

Mr. Speaker, I have examined the figures of expenditure in

exploration and development of hardrock minerals in British Columbia

during the last five years and notice that the expenditure decreased

very dramatically in 1973, 1974 and 1975. In 1972 the sum of $38 million

was expended for this endeavour; 1973, $28 million — a progression; in

1974, $19 million; in 1975, $15.6 million; and from the figures

provided for me, in 1976 the expenditure was $18 million. This clearly

indicates expenditures for exploration bottomed in 1975, and we are at

this time returning to greater interest in mining exploration.

Exploration activity in 1976 reflects a pronounced change in an area

of interest in the province. There has been a decrease in exploration

activity on Vancouver Island, in the Cariboo and northern Rockies, and

significant increases east of Kelowna and in the Goldstream area north

of Revelstoke. Exploration activity has accelerated in the Stikine and

Skeena areas. Significant increases in uranium prices have generated a

number of significant exploration programmes, particularly in the

southeastern part of the province.

The major concentration of exploration activity was southeast of

Kelowna. Exploration for uranium also took place north of Lytton, in

the vicinity of Grand Forks, in the Bugaboo Creek area and east of

Atlin. Drilling activity resumed in 1976 on the Stikine copper deposit,

after being halted because of the attitude and the punitive tax

measures of the former government.

The majority of exploration activity was centred in north-central

British Columbia, no doubt because of the extension of the BCR and

because of important copper deposits in that region — important gold,

copper and zinc deposits east of the Cassiar-Stewart Highway, in the

vicinity of Dease Lake. Declining copper prices in the latter part of

1976 have had a very detrimental effect on exploration activity as well

as profitability of the existing mines in British Columbia.

This province has some of the lowest copper grades, and therefore

must adapt more sophisticated means of production than anywhere else in

the world. The mining companies in British Columbia have done a great

job in being able to compete on the international market with the low

grades of copper deposits which they work. Our ability to further

expand copper output is very much dependent upon the level of economic

activity of our trading-partner countries such as Japan, United States

and Europe. British Columbia has been seriously affected due to the

oversupply of copper in the world because copper is over 60 per cent of

our mines' metal production. The current price of copper effectively

makes most of our copper mines marginally profitable, and the royalty

imposed by the former government would have put them in a loss position

and would have created vast unemployment in the mines of this province.

HON. J.A. NIELSEN (Minister of Environment): Tell them about the mining areas you are quoting — tell them how they voted in Williams Lake and places like that.

HON. MR. CHABOT: We are fortunate that our export of this

production is in the form of concentrates, primarily to Japan. We are

also fortunate that the

[ Page

441 ]

next most valuable commodity, molybdenum, is enjoying a strong

demand and a record high price. There is no problem with the market

demand in prices of other metals and minerals we produce.

Mr. Speaker, 1976 has witnessed the coming into production of the

first mine since the former Social Credit government was in office,

with the opening of Northair Mines, a gold-silver property which went

into production in March, employing approximately 60 employees. The

commencement of production at Atlin's silver mine, with approximately

10 employees, clearly indicates that the small mining companies have

come back to British Columbia.

The Equity placer copper-silver deposit, which was mentioned by the

member for Omineca (Mr. Kempf) the other day, and which is immediately

south of his community of Houston, is expected to go into production in

1979 with a work force of approximately 200 employees. Construction is

expected to start in 1977, with 300 employees on the construction site

for approximately two years. The putting into production of this new

mine will cost about $60 million.

The Noranda Goldstream property near Revelstoke is expected to

involve capital expenditures of approximately $50 million and generate

200 permanent mining jobs. Construction, hopefully, will start in 1978

and a projected production is for 1979.

The uranium property of Rexspar Minerals and Chemicals at Birch

Island will involve capital expenditures of approximately $30 million

and will generate 85 new jobs. Although this proposed mine is in the

early stages of development and environmental studies, it is expected,

provided all environmental conditions are met, to go into production in

Another mine that is closer to the production stage than the

previously mentioned mines is Afton near Kamloops, which involves the

capital expenditure of approximately $80 million. It is on

schedule in

its construction phase with approximately 450 construction workers on

site, and is expected to go into production in October of this year

with a work force of 350 employees.

At the Afton site will be the first true copper smelter in the

province, a new copper smelter, which we drastically need in British

Columbia — large-scale smelters — in order to further refine our copper

concentrates and generate employment for our people.

Mining exploration, Mr. Speaker, has come back to British Columbia. Government

legislation and attitude has generated confidence in the mining community, and

with investors, which will result in additional revenue to the government in

order to provide social revenue to the government in order to provide social

programmes for people as well as employment opportunities. Mr. Speaker, as far

as mining is concerned, a new day has arrived in British Columbia.

I would now like, Mr. Speaker, to discuss the petroleum-resource

side of my ministry, and I'm very gratified with the exploration

activities that are taking place at this time. Yesterday we witnessed a

very beneficial sale of oil and gas rights on behalf of the people of

British Columbia. The tender-bonus total is $8,795,000 for a total

revenue to the province of $8,953,000. This land sale generated the

highest average per-acre price in the petroleum industry's history.

As an example of the increased activity and interest in drilling for

oil and gas in British Columbia, the average price per acre in 1975 was

$11 per acre; in 1976 it increased to $18; and this last sale was

$25.50. This increased value reflects itself in the ability of British

Columbia providing additional services for people from the additional

revenue. In comparing the increased activity between 1975 and 1976, Mr.

Speaker, we find that in 1975 there was well authorization approved on

78 wells; in 1976 it increased to 173. Footage drilled in 1975 was

362,777 feet, and in 1976 this escalated to 775,397 feet. Wells spudded

in 1975: a total of 53; in 1976: 138. Bonus-bid revenue totalled

slightly in excess of $12 million in 1975, and in 1976 exceeded $43

million.

This clearly indicates that the petroleum and natural gas industry

has significantly revived its interest in exploration and development

within the province in 1976.

MR. COCKE: There's a lot of gas coming from over there!

HON. MR. CHABOT: In view of the fact that very little

geophysical work had been done in '74 and '75, few exploration

programmes had been developed. However, the industry had displayed a

remarkable ability to recover — so much so that there is every

indication that the 1976-1977 winter drilling season will be one of the

best in our history. The main catalysts for the renewed exploration and

development were the increased wellhead price for gas and a lower and

more realistic royalty rate for oil, both of which have resulted in

increased net-back to the producer and thus a more reasonable rate of

return on investment.

Gas production during the first nine months of 1976 was 275 million

thousands of cubic feet as compared to 292 million thousands of cubic

feet during the same period in 1975. This decrease is due largely to

declining reservoir-producing capabilities and to the lack of

significant new discoveries.

Oil production increased slightly from 10,885,000 barrels to the end

of September, 1975, to 11,124,000 barrels during the same period in

1976. Although it is generally conceded that the prospects for finding

[ Page 442 ]

significant additional new oil reserves are not promising, the future for new gas discoveries is excellent.

Mr. Speaker, I'm pleased with the developments that are taking place

in the petroleum industry and in the mining industry of British

Columbia. It clearly indicates to me that confidence has been restored

in British Columbia to this basic resource industry.

I'm sure that, as time unfolds and as new programmes are initiated,

the further development of our second most important industry in this

province will reflect itself in allowing the government of this

province to generate additional revenue to provide additional social

services to people and employment for the people of this province. Mr.

Speaker, the programmes and the policies initiated by that former

government were detrimental to the people of this province. For a party

that suggests that it is always working in the best interests of the

people in British Columbia, it denied the people of this province the

right to be gainfully employed.

Interjections.

HON. MR. CHABOT: No, they're not alone. They pay only lip

service to the people of this province. Their actions clearly indicate

what they were doing to the ability of people being gainfully employed.

SOME HON. MEMBERS: Right on.

HON. MR. CHABOT: This budget clearly indicates the confidence

in the ability to generate jobs for people in this province. This

government is clearly on record as being interested in generating jobs,

not destroying jobs, as your government did when you were in office.

AN HON. MEMBER: Budget gang.

HON. MR. CHABOT: Yes, Mr. Speaker, they speak against this

budget because they recognize that this budget is in the best interests

of all British Columbians.

AN HON. MEMBER: Right on!

MR. R.E. SKELLY (Alberni): I'd like to congratulate the new

Minister of Mines (Hon. Mr. Chabot) for his appointment to cabinet, and

the other new ministers for their appointments as well. I'm only sorry

that some of the deadwood in the cabinet wasn't removed.

I'd like to make a few comments on this speech that the minister

just finished. He did all right when he was rereading the annual report

of his department, and I'm sure that he's saved Hansard a little time —

they won't have to produce his speech today; simply take the pages out

of the annual report of his department and delete the references which

were essentially political and not true.

The minister said that the present Leader of the Opposition spoke in

Halifax, making damaging statements about the economy of British

Columbia and statements damaging to British Columbia. No statement made

by that member of the opposition could ever have been so damaging as

the ones that were made around this province prior to the last election

campaign, when present Social Credit ministers were going out lying to

the people about what that last government was doing.

SOME HON. MEMBERS: Oh, oh!

MR. SKELLY: If the shoe fits....

MR. SPEAKER: Order, please. You know, hon. member, that it's

unparliamentary to accuse an hon. member of the House — even past hon.

members of this House — of lying to the people. I'd ask you to withdraw

that phrase.

MR. SKELLY: I was talking about people who were involved in the last Social Credit campaign.

MR. SPEAKER: Order, please.

MR. SKELLY: A good many of them weren't elected.

Interjection.

MR. SKELLY: Present ministers included.

MR. SPEAKER: Hon. member, withdraw the imputation that members of this House lied.

MR. SKELLY: Present company excluded.

AN HON. MEMBER: Withdraw!

MR. SPEAKER: No, not a qualified withdrawal, hon. member — an unqualified withdrawal.

MR. SKELLY: I unqualifiedly withdraw the implication that

present ministers lied, but they went around the province, Mr. Speaker,

saying that the former government had set up a secret police.

AN HON. MEMBER: Is that a lie?

MR. SKELLY: Was that true?

MR. G.V. LAUK (Vancouver Centre): Sounds like a lie to me.

[ Page

443 ]

MR. SKELLY: When we confronted the present Attorney-General

(Hon. Mr. Gardom) and asked him whether there was a secret police

established in the province and asked him where in the civil service

that secret police was located, he refused to answer the question.

Interjection.

MR. LEVI: You spoke on it — yes, you did.

HON. MR. CHABOT: You're lying now.

MR. SKELLY: Mr. Speaker, I ask you to ask the Minister of Mines to withdraw the statement that a member of this House is lying.

MR. SPEAKER: Order, please. There was an exchange across the

floor, directed towards the opposition by the hon. Minister of Mines

and Petroleum Resources, in which I heard him to say: "You're lying

now." I'd ask him to withdraw that statement.

HON. MR. CHABOT: Mr. Speaker, the statement was made on the

basis of the member for Vancouver-Burrard (Mr. Levi) suggesting that I

made certain statements during the last election campaign which were

untrue, and if my calling him a liar offends the member then I'll have

to withdraw that. But he wasn't telling the truth, Mr. Speaker.

MR. SPEAKER: Order, please. That is the kind of a qualified

withdrawal that's unacceptable to the House, hon. minister. The

indication across the floor of the House was clear. I'd ask the hon.

minister, under the rules of the House, to unqualifiedly withdraw the

imputation of lying.

HON. MR. CHABOT: Mr. Speaker, I withdraw that, that he's a liar.

MR. SPEAKER: Thank you, hon. member.

HON. MR. CHABOT: But he wasn't telling the facts as they are.

MR. SKELLY: May I ask, Mr. Speaker, how much time has been

taken from my speech by the minister's accusation that another member

was a liar.

MR. SPEAKER: None, hon. member. There's a hold button on the

timeclock which is activated by the Hansard staff as soon as an

interruption takes place.

MR. SKELLY: Excellent.

The minister has stated that there was a decline in mining activity

in the province while the NDP government was in office. Certainly that

is true; there was a decline in mining activity throughout the world.

HON. K.R. MAIR (Minister of Consumer and Corporate Affairs): Except in the Yukon.

MR. SKELLY: Yes, there were claims filed and refiled in the

Yukon, yes. But the member mentioned that some mines had come on stream

this year that were under construction and under development. He

mentioned Northair Mining Company.

AN HON. MEMBER: One mine.

AN HON. MEMBER: How many shut down?

MR. SKELLY: Northair Mines announced that they would go ahead with development in the fall of 1975, under the NDP government.

He mentioned Afton Mines. When did they announce that they were

going ahead with development of a copper mine and a copper smelter in

the province? Under the NDP government. Under the New Democratic Party

government the major mines that are being developed in this province

announced that they would be developing in the coming year.

He mentioned that Stikine Copper had stopped drilling. That was in

September, 1972 — two years before mineral legislation and mineral

royalties legislation were announced by this government.

He also talked about the increase in drilling ventures in the

province, Mr. Speaker. While he didn't say so directly, he implied that

that was the result in some change in policy on the part of this

government. That's not true. The change in federal tax legislation,

which allows the rich people of this province — other provinces and

other countries — to invest in drilling ventures as co-venturers and to

write it off against their other income, has increased the drilling not

only in British Columbia, but more so in Alberta than in British

Columbia. Not any result of the provincial government now in office,

but the policy of federal government in making tax concessions again to

the rich.

I'd like to thank you, Mr. Speaker. I appreciate the opportunity to

take

part in the debate on the budget speech, although there is

certainly very little hope and encouragement to the people of this

province for a recovery from the depression that has plagued us in the

past few years. Last year the government labelled its budget speech as

a recovery budget, but it burdened the people with some of the most

predatory tax measures in a single year of any budget in the history of

this province. It was that budget and other government charges imposed

on the people of

[ Page 444 ]

British Columbia, more than any other reason, that has stalled the

economic recovery in British Columbia and has destroyed the natural

initiative and vitality of the people of this province, which is the

real basis of the economy.

You know, Mr. Speaker, I was frankly surprised by the budget. I

expected that after the recovery budget of last year, which had

virtually destroyed our local economies in this province by excessive

taxes and extremely high government charges, we would see a budget to

recover from the recovery, that government would loosen its oppressive

grip on the financial affairs of this province, and possibly allow us

to recover some of that native economic initiative and vitality I was

talking about.

But when the budget came down, there wasn't a single hint of any

government effort to stimulate the economy or to encourage citizens to

work toward economic recovery. Oh, yes, there was the repayment of

campaign debts to the mining companies and there was an admonition to

workers to work hard and get paid less. There was a concession to the

rich kids of this province which allows them to contribute less and

inherit more. There was absolutely no move on the part of the

government to loosen its grip on our economy and to allow our economy

to expand in its normal fashion, an expansion which was intentionally

throttled by that government during its last year's budget.

After the budget was dropped in the House, Mr. Speaker, I attempted

to analyse the political motives behind the fiscal measures which were

presented — not the economic motives, they were only too painfully

clear. But it appears that this government, more than any other

government in Canada, has submitted, in its activities in the timing of

its announcements and the way it announces new developments, to a

public relations regime more characteristic of an American government

than a Canadian one in the way it manipulates political opinion.

In the emphasis on restraint and the way they chopped back on social

programmes, in those announcements I suspected that the Socreds had

somehow been convinced by their own rhetoric in the last campaign, and

by the political myths that they had invented as election issues. When

I heard the speeches of some Social Credit backbenchers, some of the

ministers and the minister who has just spoken (Hon. Mr. Chabot), in

reply to the budget and throne speech, I almost accepted the theory

that they had been befuddled by their own election myths.

But no, even if the backbenchers are baffled by that type of image-making and

political rhetoric, surely this wouldn't affect the high-priced help in

the Premier's office whose responsibility it is to draft budgets and make

announcements, the type of stage-managers whose job it is to mold public opinion

for this government. These people certainly couldn't be convinced by the

products of their own creation and their own imagination. There must have been

another political motive.

I believe the rationale for perpetuating the oppressive economic

regime in this province that was imposed in last year's budget is to

delay the effect in British Columbia of the recovery associated with

the Carter economic programme in the United States until such a time as

it is more appropriate to the Social Credit objective of victory at the

next provincial election. To the timing of such public utility

investment proposals as the Revelstoke Dam, the Hat Creek proposal, the

Kitimat pipeline and coal and natural gas developments in the northeast

and the East Kootenays, all of which have been accelerated to be in

progress at the time of the next provincial election, even though

necessary environmental studies for these projects have been

accelerated with what has been termed "indecent haste" by some people

in the government service and biologists not associated with the

government.... In other words, while economic recovery is being delayed

because of the dictates of political stage-management, the

environment of this province is being sacrificed to accommodate the

political timetable of the Social Credit government.

Let me give you an example in my riding, Mr. Speaker, of the

technique which the government has used to delay a necessary social

expenditure until such time as it is more politically expedient. Early

in the months of 1976 the government announced to the citizens of the

Alberni Valley that they were third on the priority list for an

intermediate-care centre. The priority list had been prepared not by

the previous government, but by senior staff in the Departments of

Housing, Human Resources and Health.

On the assurance that their project had priority, and with the plans

approved by the various departments and by CMHC, the Alberni

Intermediate-Care Society proceeded to obtain an estimate of

construction costs. The facility would have been completed and occupied

by last fall, filling a desperate need in the Alberni Valley for

boarding-home and nursing-home facilities.

But suddenly the minister decided it was time for another study of

intermediate care. On June 18, 1976, the minister wrote to the

Alberni-Clayoquot Regional District stating that a comprehensive plan

for the development of long-term care facilities would be announced in

the late fall of 1976, and that for this reason no further approvals

would be given to intermediate-care facilities.

Then in September the Minister of Health (Hon. Mr. McClelland) wrote

that he would have a programme of long-term ambulatory care ready to

announce by the end of 1976. He had already been

[ Page 445 ]

involved in the jargon by that time. It wasn't "long-term care facilities" any more; it was "long-term ambulatory care."

Finally, after a meeting with the Minister of Health in

mid-December, at which meeting he was presented with a petition signed

by 5,200 citizens, people of the Alberni Valley, all they got was a

letter saying that the whole programme had been turned over to the

Community Care Facilities Licensing Board, which had been asked to

co-ordinate and develop the long-term care programme — more stalls,

stalls, stalls.

AN HON. MEMBER: Pass the buck!

MR. SKELLY: In the meantime, the Parksville-Qualicum Beach

area, which has the highest percentage of seniors of any population

area in the province — 21 per cent of the people in that area are over

65 years of age — is also in desperate need of intermediate-care

facilities. They've also been caught in this cynical shuffle between

the Minister of Human Resources (Hon. Mr. Vander Zalm) and the Minister

of Health over intermediate-care facilities.

When the Minister of Human Resources got up to speak in the budget

debate, he was proud of the fact that his budget had been cut back and

underspent in the last year. Naturally he emphasized the decline in the

number of people on social assistance. He said, Mr. Speaker, that the

number of people on social assistance this year had dropped over the

last three years. But what he didn't say — he was very careful in his

use of statistics — is that the number of people on social assistance

has been dropping for the last four years. They dropped every single

year under the NDP government. This is simply a continuation of that

decline, mainly attributable to programmes that we established when we

were in office.

AN HON. MEMBER: Hear, hear!

MR. SKELLY: But this decline in the Minister's budget, Mr.

Speaker, is cold comfort to the people in the Parksville-Qualicum area

and the Port Alberni area who have been stalled off for over a year in

the construction of personal- and intermediate-care facilities, only to

be told by the Deputy Minister of Human Resources that the budget for

adult-care programmes last year was under-spent by $9 million because

the department "did not end up funding some of the nursing-home

facilities it had anticipated when drawing up last year's budget."

SOME HON. MEMBERS: Shame!

MR. SKELLY: They had purposefully cut back on adult-care

facilities, on intermediate and personal care, and under-spent that

budget by $9 million.

What does that $9 million represent in terms of seniors from Port

Alberni and from the Parksville area who are being forced out of their

homes, their home towns and their circle of friends and relatives into

institutions in Vancouver and Victoria; how much in terms of extra

hardship for working families, with the senior member desperately

needing nursing care, who are forced to carry that extra burden at

home, when the minister's adult-care programme is under-spent by $9

million?

What comfort is it to those senior citizens and their families to

hear that the Premier and his circle of millionaires, who can easily

afford to keep their parents in relative luxury that they themselves

will inherit, not as a result of their own efforts, this small group,

have declared themselves a dividend from the public trough this year to

the tune of $25 million at the expense of needed adult care facilities?

While the needs of senior citizens are being neglected, as a

consequence of the dictates of political timing, monumental

developments are proceeding under the authority of the Minister of

Economic Development (Hon. Mr. Phillips), the Minister of Mines and

Petroleum Resources (Hon. Mr. Chabot) and the Minister of Energy (Hon.

Mr. Davis), projects that will have serious economic and environmental

impacts that will leave serious economic and environmental debts that

our children will be forced to bear.

The car dealers and the accountants in the Social Credit caucus are

good at manipulating variables that are quantifiable in terms of bucks.

But when the frame is expanded to include future generations, and the

debt load that we will be leaving to them when non-dollar variables are

added to the financial frame, then they're unable to cope.

The Minister of Finance talks in this budget about the theorists who

advocate deficit financing and the problem of accumulated debt that

will be left to our children. But, at the same time, in the two budgets

that he's presented, the gross debt of the province will have been

increased by almost 50 per cent over the gross debt of 1975-1976 fiscal

year, the last year the NDP was responsible for drafting the budget.

Much of this debt will be accumulated to finance the accelerated

growth of B.C. Hydro under the direction of Robert Bonner, with little,

if any, overt direction or competent direction from the provincial

cabinet. The accelerated growth of Hydro is based on realistic

projections in the growth of electrical demand. If Hydro goes ahead

with many of the projects under study, our children will find

themselves with a surplus of dams, no demand for the power that could

be produced by those dams, and a huge burden of debt and interest

payments, as well as environmental ruin in this province.

The Minister of Environment (Hon. Mr. Nielsen), who's not here today, doesn't appear to be too

[ Page 446 ]

concerned about all of this. During the last election the present

Premier, who's not here as well, promised us a super-Minister of the

Environment. Some people expected that he would appoint a real devil's

advocate who would take a strong position in cabinet and who would

challenge the huge utilities and corporations whose projects endanger

the natural environment of this province. We were all disappointed when

the present minister was appointed because he knew nothing about the

subject and appeared to care even less.

When the McGregor River project was accelerated by B.C. Hydro last

year, and when they advised the regional district of Fraser–Fort George

that construction would go ahead without completion of the necessary

environmental studies — even though the information available at that

time suggested the McGregor would destroy the salmon fishery on the

Fraser River, an industry employing thousands of people and returning

to this province $40 million annually in the gross value of the catch —

there was no comment whatsoever from the Minister of Environment.

When Hydro proposed construction of the Site C dam on the Peace

River, that would flood thousands of acres of farm land cleared and

cultivated by the effort of the pioneer citizens that the member for

Omineca talks about time after time in this House, land which will be

desperately needed in the next few years, what action did the minister

take? Again, no comment.

When the Minister of Mines and Forests (Hon. Mr. Waterland) and the

Minister of Economic Development (Hon. Mr. Phillips), after a

helicopter tour of the coal development proposals in the Kootenays,

proposed that environmental constraints on coal mines should be lifted

and that regional district input on developments would "throw the whole

process into a disruptive mess," what was the comment from the

Minister of Environment? Again, nothing.

Most recently, the Kitimat pipeline proposal threatens the

environment of the whole northern and central coast of the province and

of Vancouver Island, one of the most productive areas of the province

in terms of salmon and halibut production, and one of the most

ecologically sensitive areas on earth. And this project has no proven

long-term benefit to the people of British Columbia. It's estimated by

the consortium themselves that it could produce 150 jobs after the

pipeline is constructed.

Interjections.

HON. MR. WOLFE: Session ending soon?

AN HON. MEMBER: No, the Socreds are too cheap to give me a waste basket.

AN HON. MEMBER: Use your mouth.

AN HON. MEMBER: After I read your stuff, I need one.

MR. SPEAKER: Order.

MR. SKELLY: That's okay. The clock is stopped, I understand.

Interjection.

MR. SKELLY: This project, Mr. Speaker, has no proven

long-term benefit to the people of British Columbia, only 150 jobs when

the pipeline is in operation. But what we are doing is putting our

whole coastline in jeopardy in one of the most dangerous areas for

maritime navigation on the west coast of America in order to provide a

means for an American oil corporation to bypass stringent environmental

protection regulations in the United States. We are selling out to an

American consortium who would have to face stringent environmental

regulations if they asked for approval of a pipeline in the United

States.

MR. C. D'ARCY (Rossland-Trail): Who do they represent over there anyway?

MR. SKELLY: The consortium has stated that the project could

be completed by April, 1979 — again, getting close to the next election

— based on approval to construct by July, 1977, less than six months

from now. Engineering studies are in progress right now to ensure that

construction can commence immediately once the project has been

approved by the National Energy Board.

This government is responsible, Mr. Speaker, for the right-of-way of

that pipeline over British Columbia's territory. It is responsible for

the shoreline of this province, and the central and northern coast, and

the northern coast of Vancouver Island. It is responsible for the

foreshore in Kitimat harbour and for approval of the oil off-loading

facilities. But what position has the Minister of Environment (Hon. Mr.

Nielsen) taken? Absolutely no comment. No comment even though he has

jurisdiction for the right-of-way, for the shoreline, and for the port

facilities.

MR. KING: I said good morning to him today and he was stuck for an answer. (Laughter.)

MR. SKELLY: He had to consult the Premier. (Laughter.) What

position has the Minister of Environment taken on any serious

environmental issues? No comment. Has he publicized the studies

produced by the consortium on marine and terrestrial

[ Page

447 ]

impacts? Not available. Has he conducted studies of his own, or

published critiques of studies done on the consortium studies? Not

interested. Not available.

What the minister has done is not to call to account those large

multinationals involved in these projects. What he did in the House a

few days ago was to attack those organizations such as SPEC —

organizations which rely mainly on volunteer contributions of money and

effort to act as spokesmen for the environment of this province. He has

attacked their judgment; he has denied them access to reports which are

available to his department; he has attacked their studies — again,

done on a voluntary basis by experts with limited financial resources —

without revealing his own sources of information and the basis of his

attack on their studies. In short, as the super-minister of the

environment he has been a colossal failure.

AN HON. MEMBER: Right on!

MR. SKELLY: He has environmental jurisdiction in name only,

and he has sold himself out to those heavyweights in the cabinet, and

outside the cabinet, in order to hold on to his job. Mr. Speaker, last

fall when the Premier was considering changes in the cabinet I wrote to

him and I asked him to consider the removal of Mr. Nielsen and to have

him replaced by an independent environmental ombudsman whose duty it

would be to defend the future generations of British Columbia and their

interest in the preservation of our environmental assets, and who would

have the power to produce independent environmental impact studies and

the duty to hold public hearings before any major development is

permitted.

I got a reply from the Premier saying: "Thank you for your comments."

The present minister has shown no interest in defending the environment. He's

got no credibility in cabinet, which is dominated by developers. As a result,

future generations in this province will be burdened with an environmental deficit

and a lower quality of life, as well as a colossal financial debt that will

be imposed by major public utility and mineral developments.

I again call on the Premier to sack that minister and to consider

the alternative of an independent environmental ombudsman. I also call

upon the government, as some of their backbenchers have had the courage

to do, to take an unequivocal stand in opposition to the supertanker

route through Dixon entrance and Hecate Strait to Kitimat.

Mr. Speaker, the performance of this government in fiscal, social,

and environmental areas has been disastrous to the people presently

living in the province, people who have been looking for strong

political leadership to encourage economic recovery in British Columbia

without mortgaging the quality of their children's lives in financial,

social and environmental terms. This budget speech indicates that the

leadership the people of this province have been seeking is lacking and

has been substituted for political image-making. It is not likely to be

restored until the New Democratic Party is returned to office in the

next provincial election.

Mr. Mussallem moves adjournment of the debate.

Motion approved.

Hon. Mr. Chabot moves adjournment of the House.

Motion approved.

The House adjourned at 12:39 p.m.

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