1973 Legislative Session: 2nd Session, 30th Parliament

HANSARD

The following electronic version is for informational purposes

only.

The printed version remains the official version.

Official Report of

DEBATES OF THE LEGISLATIVE ASSEMBLY

(Hansard)

TUESDAY, APRIL 10, 1973

Night Sitting

[ Page 2499 ]

CONTENTS

Night sitting

Routine proceedings

An Act to Amend the Municipalities Enabling

and Validating Act (Bill No. 176).

Hon. Mr. Lorimer. Introduction and first

reading — 2499

An Act to Amend the Mineral Act (Bill No. 144). Second

reading.

Hon. Mr. Cocke — 2499

Mr. Smith — 2499

Mr. Richter — 2502

Mr. Gardom — 2504

Mr. McClelland — 2505

Hon. Mr. Nimsick — 2507

Division on second reading — 2508

Mineral Property Taxation Act Repeal Act (Bill No. 47).

Second reading.

Hon. Mr. Nimsick — 2509

Mr. D.A. Anderson — 2509

Mineral Land Tax Act (Bill No. 64). Second reading.

Hon. Mr. Nimsick — 2509

Mr. Phillips — 2510

Mr. D.A. Anderson — 2512

Mr. Wallace — 2513

Mr. Richter — 2513

Mr. Morrison — 2515

Mr. Gardom — 2516

Hon. Mr. Nimsick — 2516

Division on second reading — 2517

An Act to Amend the Placer-Mining Act (Bill No. 169). Second

reading.

Hon. Mr. Nimsick — 2517

Insurance Corporation of British Columbia Act (Bill No. 34).

Second reading.

Hon. Mr. Strachan — 2517

Mr. Gardom — 2518

Mr. Smith — 2519

Mr. Wallace — 2520

The House met at 8 p.m.

MR. SPEAKER: The Hon. Minister of Municipal Affairs.

HON. J.G. LORIMER (Minister of Municipal Affairs): Mr.

Speaker, I have the honour to present a message from His Honour

the Lieutenant-Governor.

AN ACT TO AMEND

THE MUNICIPALITIES ENABLING

AND VALIDATING ACT

MR. SPEAKER: His Honour the Lieutenant Governor transmits

herewith a bill intituled

An Act to Amend the Municipalities

Enabling and Validating Act and recommends the same to the

Legislative Assembly. Government House, April 10, 1973.

Bill No. 176 introduced, read a first time and ordered to be

placed on orders of the day for second reading at the next

sitting of the House after today.

Orders of the day.

HON. D. BARRETT (Premier): I move the House proceed to

public bills and orders, Mr. Speaker.

Motion approved.

HON. MR. BARRETT: Continued debate on second reading of Bill

44, Mr. Speaker.

AN ACT TO AMEND THE MINERAL ACT

(continued)

MR. SPEAKER: The Hon. Minister of Health Services and

Hospital Insurance adjourned the debate.

HON. D.G. COCKE (Minister of Health Services and Hospital Insurance):

Mr. Speaker, as you know I spoke for a brief time before the dinner hour. I

spoke about balance and the fact that this bill provides a new kind of balance,

an opportunity for government, an opportunity for the people, to provide a fair

balance in this industry as is required elsewhere.

Mr. Speaker, we listened with some interest to the Hon.

Member for South Peace River (Mr. Phillips) across the floor

this afternoon, reviling us with Chile and other areas in the

world. Mr. Speaker, it is just completely irrelevant. Why

didn't that Member talk about Sweden, and the way they've

mastered the production of their resources for the sake of the

people in that country.

Mr. Speaker, I believe that as a resident of this country, the kind of ideas

that are in this bill, of 50 per cent Canadian directors speaking on behalf

of Canadians — these are the kind of things that are important.

They are the same people across the way, Mr. Speaker, who

talked about this great government control in the mining

industry, but they also are the same people who talk about wage

controls. They don't mind wage controls at all. But when it

comes to talking in terms of having a balance with industry,

then they fear and are fretful — because, of course,

there is a very close relationship.

Mr. Speaker, there's an awful lot in this bill that is very

strongly in the favour of the people of B.C. and who could help

but support it? Mr. Speaker, we support it in every way.

MR. SPEAKER: The Hon. Member for North Peace River.

MR. D.E. SMITH (North Peace River): Thank you, Mr. Speaker.

The adjournment at 6 o'clock and reconvening at 8 o'clock seems

to have left us with a lot of people who still believe that the

House is going back in at 8:30 apparently. Mr. Speaker, we have

a lot of empty seats. But perhaps when they come back they will

be able to tell us what happened in overtime this evening in

the hockey game, if I may be so bold as to suggest that they

may be watching the hockey game.

In any event speaking to the principle of this bill, Bill

No. 44, we cannot, Mr. Speaker, in my opinion, look at Bill 44

in isolation. If the Opposition has been trying to get any

message through to the Members on the cabinet benches, not only

in this bill but in others, it is that we do not view in

isolation the impact of Bill 44; no more than we can view in

isolation the impact of Bills Nos. 31, 19, 20, 35, 36, 42 and

It is the overall impact that these bills collectively will

have upon the economy of the Province of British Columbia which

must be taken into consideration. It is O.K. that we have to

debate these bills one at a time as the rules of the House

dictate. We are prepared to do that, to debate them one at a

time. But it must be apparent to everyone not only inside this

chamber, but to the people whom we represent, that the

collective platform and programme of the NDP, as expressed not

only in Bill 44 but in many other pieces of legislation to

which I have just referred, spells doom for the private

enterprise system in British Columbia.

By one means or another it is apparent that this Government

is determined to follow a takeover course. I don't care how the

Government decides to smoke that particular suggestion up, or

how they waffle on the matter. It is apparent that this is a

takeover session; that the bills, when they are enacted, will

give this Government power completely

[ Page 2500 ]

beyond anything that any government should have available to

them. That is why we stand in our place and bring to the

attention of the cabinet Ministers our point of view.

We don't do it to be obstructionists. We do it to try and

get through to you on the basis of the thoughts of people who

believe there is a better way to handle the affairs of the

province; that the Government is in the business of government,

not in the business of taking over all of the private

enterprise sector in British Columbia.

[Mr. Dent in the chair.]

In dealing with Bill 44 we have just moved one step further

down that road. It is obvious to me, Mr. Speaker, in looking at

this bill, that it, in one section, will have a disastrous

effect upon those people who prospect in the Province of

British Columbia.

It would be one thing if the Government could point with a

certain amount of accuracy to the fact that the prospector was

a thing of the past, that he was extra baggage as far as the

mining industry was concerned; that it was someone who is no

longer needed in the process of finding and developing new

mineral resources in the province. But the Government can't

point to that fact. And the reason they can't is that they know

that most of the major discoveries of mineral in the Province

of British Columbia have been made by those very same independent people who chose that type of life for

themselves; who have been prepared to go out into the hills and

the mountains and live a very rugged life.

What makes them do that? What makes them carry on? What

makes them meet adverse conditions and weather and flies,

mosquitoes, hot weather and cold weather? Because they have in

their veins, I guess, a feeling that somewhere there is a pot

of gold at the end of the rainbow, and that if they work

diligently and hard, someday they are going to make the one

major discovery. Fortunately it has happened enough times in

the past that we still have people who are prepared to make

those sacrifices today.

Now, what have we done to this class of individual? Well,

this bill makes their job more onerous, more cumbersome and

more expensive, if they desire to prospect for minerals in the

Province of British Columbia.

So why do we penalize them? They are the most important individuals in the

whole process. The prospector is to the mineral industry what the geophysical

experts are to the petroleum industry. They are the ones who work the area on

the ground, spend their lifetimes in the hills, as I have said, looking for

outcroppings and rock formations that have mineral potential. It is a wealth

of information and knowledge that has been gathered over a long period of time

that they take with them, as well as a prospector's hammer. And it is a desire

to find a major discovery that makes them go back into the hills year after

year.

The provisions in this bill, Mr. Speaker, put imposts upon

them that will make it very difficult, if not impossible, for

the prospector, unless he has substantial backing from some

company, to continue in his chosen field. So why did the

Government find it necessary to penalize individuals? I think

the Minister must be aware of the important part they play in

the whole process of discovering minerals. He must be aware of

the fact that they have been responsible for most of the major

discoveries in the Province of British Columbia. And while we

have a lot of technological advances today in mining and a lot

of electronic equipment, we still really depend upon the fellow

who goes out there with a pack on his back to help us find what

underlies the overburden throughout the mountain areas of this

province.

Now, it so happens that British Columbia is a province with

a tremendous area covered by mountain formations. Within those

areas we find a fair amount of minerals. But we cannot look at

that resource in isolation any more than we can look at this

bill in isolation. The fact of the matter is that many other

parts of the world are amply endowed with minerals to a far

greater and richer degree than our own province. So if we are

to develop our resources we must be expert in the field and we

must be able to do everything a little bit better than anyone

else, because we must compete on world markets for the sale of

those resources.

This bill places too much discretionary power, Mr. Speaker,

in the hands of the Minister. It allows the government to

dictate whether an individual or company can place new

discoveries in production and it dictates under what conditions

they will place those new discoveries in production. The bill

contains unnecessary production lease requirements and imposts

upon the small producers that they may not be able to live

with. It places the government in a position where they can say

to the people who are the original discoverers of a new mineral

resource or a new mineralized area, "Go ahead. Work, sweat it

out, you do all the work, you take all the risk and we'll come

to the area of development and talk terms about the partnership

we are going to form. We feel we deserve part of the

action."

They can force this into any new development in the Province

of British Columbia, because without the sanction and authority

of the government that mine will never come into production. If

the government insists upon being co-owner of the mine, they

can do so under the provisions of this bill. That is why I say,

Mr. Speaker, that we cannot deal in isolation with this bill

without looking at the whole programme that is laid out in

other bills that are

[ Page

2501 ]

before this House.

That is why, Mr. Speaker, we oppose this type of

legislation. It is discriminatory. It places in the hands of

one Minister of the Crown power far in excess of anything that

he should be allowed to wield. It makes it impossible for

developing companies to effectively compete for development

capital. Maybe that is just exactly what the government is

desirous of, because they can then supply the capital on an

equity basis and force the mine into a partnership regardless

of how unwilling the industry may be to take the government in

as partners.

They do this by legislative process. It's going to have a

detrimental effect on the mining industry. We've already seen

the results of that. It will certainly make it very, very

doubtful whether new mining ventures will come into fruition in

the Province of British Columbia. As a result it will mean lost

jobs to people who would otherwise be employed in the mining

business.

It's the type of legislation which we oppose. Because if we

look at the record of the mining industry …

Interjection by an Hon. Member.

MR. SMITH: The message I just received, Mr. Speaker, is that

Buffalo just won. It's nice to know that the series is extended

and that Montreal doesn't have everything their own way.

That's what I'm here to tell the Hon. Minister here this

evening — a little competition is a good thing.

Interjection by an Hon. Member.

MRS. P.J. JORDAN (North Okanagan): We're not crying. You're

the ones who are crying. "Boo-boohoo! No one will do what we

want them to."

MR. SMITH: We're the people who intend to provide a little

competition with the government in the bills we don't like. We

are here to do a job, and I think that regardless of how the

government may view it they must realize, having had more

experience in opposition than in government …

MRS. JORDAN: They'll have a lot more, too.

MR. SMITH: …that they might be able to take a few words

of advice from the official opposition now and again on some of

their programmes.

Of course, we wouldn't mind a few of your notes on how to be

an effective opposition.

HON. MR. BARRETT: Haven't you found that out yet?

MRS. JORDAN: I think we're doing all right.

MR. SMITH: You know, I think we're not doing too badly, Mr.

Premier.

MRS. JORDAN: We never lost control of the House like you

have.

MR. SMITH: We're not doing that badly, Mr. Premier.

DEPUTY SPEAKER: Would you return to the substance of the

bill, please?

MR. SMITH: I thought that that was part of the substance of

the bill. As a matter of fact, I thought I was keeping very

close to the principle of the bill, Mr. Speaker.

I don't intend to harangue the Minister for any length of

time this evening.

HON. MR. NIMSICK (Minister of Mines and Petroleum Resources) : You're

free to do it.

MR. SMITH: No, I'm not going to pull one of those types of

exhibitions and performances that we have seen when you

yourself and other Members of the government were in the

official opposition.

I just want to say this: what it boils down to, not only in

this bill but in many bills that are before this House, is that

we hold a philosophy much different from your own. In due time

the voters in the Province of British Columbia will determine

who made the right decisions. I'm sure that many people —

the 60 per cent who did not support the NDP — are as

concerned about the principle of this bill as I am myself, Mr.

Speaker. We do not intend to support the bill. We think it is

poor legislation.

HON. MR. BARRETT: Mr. Speaker. A point of order. The

opposition is constantly misleading us. There was no score

— they're back playing again. (Laughter).

DEPUTY SPEAKER: There is no point of order. Would the Hon.

Member please proceed?

MR. SMITH: At least we aren't offside, like the Government

is all night.

HON. MR. BARRETT: Offside goal?

MR. SMITH: Mr. Speaker, in all charity, I must say to the

Minister that we do not intend to support this legislation. I

must say this to you, Mr. Minister, through you Mr. Speaker:

you do not need Kierans to tell you how to wreck the mining

industry in the Province of British Columbia, because in that

respect you are doing a very good job yourself.

[ Page 2502 ]

DEPUTY SPEAKER: I recognize the Hon. Member for

Boundary-Similkameen.

Interjection by an Hon, Member.

MR. F.X. RICHTER (Boundary-Similkameen): No, but I would

like to speak again.

MRS. JORDAN: Some of your own Members want to speak.

MR. RICHTER: Mr. Speaker, in speaking to the principle of

the bill, I don't think it is unrecognized that the

Mineral Act which we are dealing with at the present

time — Bill 44 — did require some updating. It was

a subject of considerable discussion when I was Minister of

Mines. In fact the Speaker of the House, who was interested in

the prospecting and mining field, made certain recommendations

to me. Surprisingly enough, they were part of the terms of

reference that I referred to a committee of the Department of

Mines and Petroleum Resources along with the mining industry

to make a complete study of the Act and bring back

recommendations to me in the fall of 1972 so that legislation

could be promulgated and the Act could be amended as it was

needed.

There was considerable dialogue carried on between the

industry and the department and good progress was being made up

until August 30. After that period it seemed that the committee

that was doing the work was sort of side-tracked and no further

work was done in relation to studies and work that would have

resulted in the type of legislation which would have been both

to the advantage of the government and also of the industry. We

were asking for input from the outside — the beef cattle

growers industry, the mining industry and all industries

affected through harvesting of mineral resources.

In the principle of this Act there are a considerable number

of measures. There are some policies and principles there that

I think government and industry could have done well

without.

Certainly there have been a number of increases in the

assessment and fee requirements, even down to the free miner's

licence. I never could understand why they called it free

— it always cost $5 and the increase in the bill is just

about double. It is still not that devastating as the average

person can dig up the extra $5.

But it is in the field of assessment work that many small

prospectors just don't have the type of money that will be

required now to undertake the work on a unit basis, on the 40

claim unitization. Even when it comes down to possibly 20

claims it is just more money than they have to be able to put

into that type of work. Even if they hire the work done by

bulldozer, backhoe or whatever it happens to be, this is costly

and time-consuming.

The proportion of successful claims that turn into viable

mines is certainly not an encouraging percentage. It has been

worked out on the basis that about one claim in 100 becomes a

viable producer. This is a pretty wide disparity in trying to

prove up ground, spending money on a claim for two or three

years and then finding out that it is not a viable claim. While

we have had some successful prospectors we have also had many,

many people other than Bryn Brynelsen, Morris Menzies, Spud

Huestis types. These are only a few; these get recognition;

these are the successful ones. Now hundreds of other

prospectors have prospected their entire lives, but because

they have not been able to develop a property to the degree

that it becomes a producer so that they can reap some of their

rewards, they usually have to sell that property for a few

dollars in order to maintain other claims, attempting to find

that one strike which would tide them over for the rest of

their lives.

Under this new type of policy and philosophy, it looks like

a losing proposition from the beginning, in that there are so

many ways in the principle of this bill in which the prospector

loses his confidence in having some secure form of tenure. Even

though it does cost him some money and a lot of work, the fact

is that he can be denied a renewal of his lease, he can be

denied a production lease, he can be denied the continuation of

his mining if it doesn't meet exactly the requirements of the

government or if they feel that they can do a better job of

developing the mine.

Well, again, we get into the public purse on a high-risk

development project. The history of mining in the province has

not been all that bright that the taxpayers' money should be

put into such high-risk ventures.

There has been a great deal of feedback from the public and

the Press. Only today one of the principal papers of the

province came out with the headline: "Things Look Slightly

Bleak. Jobs Needed as Firms Move from BC as Finders No Longer

Keepers in High-Risk Exploration."

These of course stimulate the apprehension. on the part of

prospectors, inasfar as venture capital is concerned. They are

not ready to risk this. They look for a political climate that

is more conducive to the development of the resources. I am

confident that we are going to find a very substantial amount

of high-risk capital that would have ventured into the

province, would have remained here and now will be diverted out

of the province.

The mining companies themselves are sceptical. The European

metal market has not been good. I think it has been freely

admitted here that we are not getting the 70 or 80 cents a

pound for copper we used to get. That is a high-priced metal

right now as well as gold. We haven't had one producing gold

mine in British Columbia since Bralorne closed down after a

40-year run.

[ Page 2503 ]

So I can't see all this amount of advantage in the basic

principles of Bill 44. I think the mining companies have

studied it very thoroughly. They have made an analysis of it.

They have sought to have clarification of the intent and spirit

of the Act, and they still come up with the same answer —

that it is just not for them.

There is no question that the mining industry in British

Columbia has been a substantial revenue producer for the

province. I think the Minister recognizes this, and I am sure

the Government wants to have a strong, viable mining industry.

But I can't see, Mr. Minister, through you Mr. Speaker, that

there is any possibility of seeing an acceleration in the

mining field due to this type of legislation.

We know that there are other bills on the order paper that

will be discussed in due time. They detract from the mining

industry just as Bill 44 does — the basic principles of

Bill 44. The powers that are within Bill 44 are very intense as

far as the Minister is concerned. The appeal from decisions is

not all that great. Consequently a great deal of apprehension

is evident today, not only in the mining industry from the

standpoint of exploration and development, but from the point

of view of investment capital — risk capital to develop

the resources.

We had, only within the last year or two, a very devastating

drop in the price of copper. Some mines were operating at

probably a differential of about one cent between their cost of

production and the value they were getting for their copper.

This really is not an encouraging situation as far as placing

risk capital out for the development of mines. Some of them,

because of the low-grade ore, because of the fact that

molybdenum, which was an anomaly in the production of copper

from some of our producing mines — it was a glut on the

market, the copper itself.

Had it not been for a little gold and silver that was also

brought out through the mining of the copper, which was the

primary objective, they certainly would not have been able to

make both ends meet.

Only in this last year, when you read the financial

statement of Brenda Mine, probably one of the lowest-grade

copper producers in the mining field in British Columbia

— they didn't make any type of profit — they made a

loss. Now you can only stand this sort of a loss for so long,

and they closed down.

So the mining industry hasn't been all that lucrative, or

the contracts that they have for their metal. Unless we get

some refining, and certainly fabrication of the metal within

British Columbia, we could find ourselves one day without

markets. This is due to the fact that other countries who have

higher-grade ores have better mining costs, due to the fact

that it is not costing them as much for the production of the

product. They are getting certain government subsidies and

assistances. These in themselves certainly place British

Columbia in a very difficult position as far as being fully

competitive is concerned.

There is nothing we can do about that but to try and assist

the industry to be able to produce at a rate which will provide

them with the opportunity to compete in the open world market.

We sell based on the European metal market, and that is our

barometer of prices. Consequently we see the mining industry

today in almost a position of having a heavy cloak brought over

them to the degree that they are thinking very seriously of

cutting back on development of new properties.

Certainly they are not going to close down their existing

operations, but as these progressively are mined out, no new

mines will be coming on the scene for the years henceforth. It

takes anywhere from five to eight years to develop a producing

mine. If we run out, as we will on some properties within the

next two years, we are going to find a period of time in there

in which we will not have sufficient time to develop producing

mines.

Now what does this have to do with the principle of this

bill? The principle of this bill, because of the very strong

measures that are incorporated into the bill, leaves something

to be desired as far as the mining industry is concerned

— in seeing their security maintained, in controlling

their properties after they have brought them into production

and have the production lease.

In previous years, under the existing laws, there has been

no question in their mind but what they could move along. As

long as they met the regulations which were set out in relation

to their reclamation programmes, their recovery, the fact that

they carried out proper mining procedures, they felt a degree

of security in that they are able to work their properties and

make a contribution to society.

Now they are already taxed, and this will be discussed

further in another bill. They already bear very heavy costs

compared to other industries such as the wood industry, where

you can actually see the resource right on the ground.

Certainly the mining field is not one which you can determine

exactly. Even to delineate an ore body takes a very substantial

amount of capital and a great deal of work. And it takes the

little prospector who, in the past, through the grub-staking

fund, or on his own, or who was sent out by mining companies,

explores the various areas which would be almost inaccessible

to any other type of access other than foot-slogging it, or

packing in with their pack animals to a point from which they

work.

However on the other hand, large companies can use

helicopters, and equipment of that nature. They can explore the

outer regions and particularly the heavily-mineraled areas of

the Omineca and Atlin areas. This is done pretty much by

helicopter. But it is only a large company that can afford that

sort of

[ Page 2504 ]

exploration. The little prospector is absolutely locked

out. In the first place access is not that much to his

advantage, because distances are long, supply posts are a very

great distance from the areas that they are working; so it is

virtually impossible for them.

But there are many areas that they can work throughout the

province, and it is a very large province to prospect in, and

it is very heavily mineralized. We still need this man who is

prepared to go out and face failure after failure, and

occasionally make some success. But we need these in numbers,

so that we can locate the minerals of the province, so we can

develop the ore bodies, so we can secure the benefits in the

interests of society and government.

It is well known that government has many obligations in

which they depend on a source of revenue. If it's the mining

industry that helps the social services of the province, well

then certainly this is an area in which we shouldn't deter from

greater development.

There are a good number of measures within Bill 44. I feel

that it's a piece of legislation we could have well done

without at this particular time. I would have liked to have

seen a little more dialogue between industry and government

— when I say government, I mean the Department of Mines,

the personnel within the Department of Mines. I would have

liked to have seen a little more in-depth study before we

entered into any type of legislation such as we have, because

it's my understanding that should there be a fall session

— which we're led to believe that there will be —

there'll be additional amendments brought in.

AN HON. MEMBER: We'll still be here.

MR. RICHTER: Very likely we could be. I don't mind it here,

you know — it's not all that bad. I don't object to doing

the people's business — and if it takes until fall I

don't mind, because I've got nothing else to do anyway but do

their business for them.

I'm not quite so fortunate in being able to go out and visit

the mines. My successor has that prerogative now and I'm sure

that he'll enjoy it. I'm sure that he'll go out and do his bit.

He's already entered in this sort of a field as other cabinet

Ministers are. They like to ride in the silver bird and I'm

sure that it will be educational to them if nothing else.

But this particular piece of legislation — I would

have hoped that the government would have a little more time to

study it; do a little more input; possibly have had a committee

do a bit of work on this — get out there in the field and

see what could be done. See the actual operations on the

ground.

Interjection by an Hon. Member.

MR. RICHTER: I certainly broadened my spectrum of knowledge,

as far as that is concerned. I visited the Bralorne Mines

— the tunnels were 125 degrees Fahrenheit, depth 1,800

ft. below the Burrard Inlet. These were experiences. This is

what should be done. But I would like to have more Members have

the opportunity to go out and see these things.

I would have thought that if this bill had been brought in

as it is, referred to a committee and let them have dialogue

with the industry, then come back in the fall — then we

would have been able to bring in a more comprehensive piece of

legislation.

Now it's going to be piecemeal because if we come in again

in the fall and start amending this all over again, I wonder

just what advantage will have occurred in the mining industry

and to the government.

There are many predictions coming out in the Press. "B.C.'s

mining consultants predict slim months ahead." This could be.

If exploration development capital is withheld, certainly there

will be a considerable loss of opportunity for jobs —

particularly university students, and other geologists,

geophysicists and so on who would have been able to work this

summer and compile their notes and so on during the winter.

This is a very common practice.

I have to say that I personally will have to oppose this

legislation primarily on the basis that I think that better

legislation could be prepared if a committee could have studied

it. With dialogue with the mining industry — some input

from the mining industry — then I think we could have come

up with a piece of legislation which would certainly improve

the existing Act substantially. At the same time, those who

felt that the present Act was not meeting their requirements

would have had an opportunity, particularly the beef cattle

growers, to have made a contribution. Certainly I think we

would have been doing a little better job.

I have to look at Bill 44 — very honestly, I have to

look at it in this way, that it was a known fact that in the

years that I had as Minister, certainly a great deal of

contribution was forthcoming from the various Members in the

House. It was through this and other input that I set up that

committee which was doing the study and got sidetracked

somewhere along the way after August 30.

[Mr. Speaker in the chair.]

MR. SPEAKER: I recognize the Hon. Second Member for Vancouver-Point

Grey.

MR. G.B. GARDOM (Vancouver–Point Grey): Oh, how kind

of you!

Interjections by some Hon. Members.

MR. GARDOM: How kind of you. Thank you very much. Two

witches.

[ Page 2505 ]

Interjections by some Hon. Members.

MR. GARDOM: Mr. Speaker, one thing is very paramount about

this bill. It's not going to bring down the government and it's

certainly not the last straw, but it's just another load on the

back of B.C. citizens. It's another infringement upon rights;

it's another infringement upon initiative. It's another burden,

another restriction. It's another example of the hampering of

development. It's another step, I'd say, towards the hindering

of a flourishing economy. Most of all, it's another very

demonstrative indication of the centralistic and

regulationistic, impersonal and all-governmental direction of

our B.C. socialists.

At times, Mr. Speaker, the business community and the

working community, and even some of the opposition Members

appear to be somewhat mystified as to the socialistic

direction. And they shouldn't be, because the socialists have

laid some of it down in black and white — and they're

pretty much cultists when it comes to following that which they

have written.

We find in the material that they have put out before their

entering into the election campaign last year — they talk

about an economy for people. They say that they're going to

establish this, "by establishing full public control —

full public control over our resource sector."

Good heavens, this doesn't disturb, you see, the most

powerful Minister in the government and the gentleman I suppose

most responsible for shaping some of the more dramatic

philosophies that are coming across in the legislation. But

this doesn't disturb him. This makes him content and happy. He

sort of feels like Father Christmas; but the intent of Father

Christmas was to give and not to take.

You know, if we divided society into two sorts of people,

givers and takers, I'm afraid that the Hon. Minister of Lands,

Forests and Water Resources (Hon. Mr. Williams) would fall well

within the category of a taker.

Secondly, if you just take a look at the second little bit

of cult that we have, and that's in the Waffle manifesto. And

they talk about the instruments for bringing the Canadian

economy under the control of Canada. They say, "including

extensive public control over investment and nationalization of

the commanding heights of the economy such as the key resource

industries, finance and credit, and industries strategic to

planning our economy."

So this is just a very, very clear step. This is a small

one, but again, a very clear one and just another one towards a

very firm establishment of the policies which the socialists

propose.

You know there is one thing that they're missing in, this

and that's this: that this New Democratic Party, Mr. Speaker,

came out of the last election with 40 per cent of the popular

vote. That 40 per cent of the popular vote, Mr. Speaker, was

just about a 10 per cent negative vote, and that 10 per cent

eroded very quickly after they achieved office. That brought

them down to about 30 per cent. And I would say that after the

legislation that has been proposed and not even yet passed in

this House, that they'd be awfully lucky if they were hitting

22. There's the greatest example of a runaway ship — boy

oh boy!

It's going to be very interesting to see whether or not the

general public in B.C. have a cumulative memory — perhaps

they'll never have one to the extent of the labour movement

— but if they've got a cumulative memory that will run

the better part of another three years, what indeed will be

happening come the next election? Where are all of these

fellows over there and all of the people that they happen to be

appointing to their commissions and board, what are they going

to be doing?

MR. D.M. PHILLIPS (South Peace River): Mass unemployment.

(Laughter).

MR. GARDOM: My friend from the Peace is advocating that they

should stay in because if they went out there would be more

unemployment than we have ever seen in the province before.

It's probably a very, very valid premise indeed. It certainly

is.

I think that this bill and others that are coming in this

session are going to end up being very, very early indicators

of the fact that your public acceptability is running out very

quickly. If you'll pardon the metaphor, it's running out drip

by drip and the drips are getting larger all the time.

MR. SPEAKER: A point of order?

HON. MR. BARRETT: I don't think the Member should sit down

until he at least speaks on the principle of the bill.

(Laughter).

MR. SPEAKER: Why should he be different? (Laughter).

MR. GARDOM: On a point of order, Mr. Speaker. When you were

elected you promised you wouldn't fly any more. (Laughter).

MR. SPEAKER: The Hon. Member for Langley.

MR. R.H. McCLELLAND (Langley): Mr. Speaker, I just want to

say a few words in support of the miners in Langley. The health

Minister (Hon. Mr. Cocke) talked about balance, Mr. Speaker.

Well, I'd say they've got the mining industry balancing on a

[ Page 2506 ]

tightrope. It's going to fall off and you'll never be able to

put it back together again. You're wrecking the mining industry

— at least this bill will wreck the mining industry. The

people you're picking on hardest again, as with so much of the

legislation that's coming from that side of the House, are the

small miners, the prospectors and the little companies that

can't look after themselves.

The big companies can take care of themselves. They can

weather any kind of storm that happens to come up. But the

little companies and the single prospectors just don't have a

chance.

I wonder if they honestly think, Mr. Speaker, that they can

keep hitting and hitting and hitting at so many segments of

business and industry with more taxes and more abuses all of

the time without the economy falling apart? It just can't be

done.

Business and industry in this province are saying that

enough is enough. Lay off. You've done enough damage now. Back

off for a while. Take this bill and put it over until the fall

at least. Send it out to committee if you have to. Better yet,

tear it up and throw it away.

Mr. Speaker, this Government seems to be bent on a

deliberate course of causing unemployment in the Province of

British Columbia. The people in the mining industry have

already told you that there are 500 men out of work right off

the bat and that the prospects are for more over the next few

months. If that's not a course bent on creating unemployment, I

don't know what it is. You're putting people out of work in

every kind of industry in the whole province, Mr. Speaker.

What kind of terms are you going to demand from the miners

before you'll grant them a production lease? Are you going to

demand an equity in their company? Is that what you want? If

they prove out a good find are you going to say to them, "O.K.

fellas, you can have your production lease but we want our

share. We want 50 per cent of the company, we want 60 per cent

of the company"? Or do you want to just shove them out

altogether?

Interjection by an Hon. Member.

MR. McCLELLAND: More than your share is what you want, Mr.

Minister. The Member on my left described you very well when he

referred to you as the "grey eminence" of this kind of

legislation. You want far more than your share and you're

taking far more than your share.

Interjection by an Hon. Member.

MR. McCLELLAND: It isn't red at all. It's maroon. Mr.

Speaker, I don't understand why the people on the other side of

the House would think that a company would even want to risk

their money when the Minister of Mines will hold their future

in the palm of his hand. What's the point? What's the point,

Mr. Speaker, of a government going out and risking its

hard-earned money? They take all the risks and you take all the

gravy. That's a pretty good deal.

The Minister, Mr. Speaker, said that he held meetings with

the miners. I agree that it was reported that he did hold meetings

with the people from the industry. He was telling the

truth.

AN HON. MEMBER: He did all the talking.

MR. McCLELLAND: But he sure didn't listen. He didn't listen

at all. You held meetings with people, you let them talk with

you. What's the point unless you're prepared to listen and take

some good advice from the people who know?

The new president of the mining association, Mr. Speaker,

was part of that input I suppose. He was here talking and

making suggestions. Do you know what he said, Mr. Speaker? He

said, "We just wasted our breath. It didn't do a bit of

good."

That sounds very familiar, Mr. Speaker. It sounds extremely

familiar. I can think of another piece of legislation that came

before this House — Bill 42 — in which this

Government didn't listen to the farmers. You haven't listened

to the people in local government. You haven't listened to the

people at all. If you're not prepared to listen, what's the

point of even having meetings with people? It just doesn't make

any sense.

Mr. Speaker, something else is becoming very familiar too

with this Government, because just as this Government keeps

passing punitive legislation that strikes hardest at the small

businessmen in this province, so you're striking out at the

individual prospector again, and the small mining company.

I notice, Mr. Speaker, a report in one of the newspapers not

long ago from once again the new president of the mining

association — I believe his name is Mr. Tupp. He had a

very telling point when he said that he welcomes the

government's entry into the mining business. Make no mistake,

Mr. Speaker, that's what the intention is. The government is

going to get into the mining business in a big way. They're

going to force their way in by punitive measures. When you come

to get your production licence you're going to find yourself in

partnership with the government.

Mr. Tupp says he welcomes the government into the mining business because there's

no quicker way, Mr. Speaker, of finding out the facts of life than losing your

own money. That's what you're going to do. The Minister of Mines is going to

find himself along with every other department of this government throwing money

down the drain — money after money after money. It really isn't your own money,

in case you didn't know. It happens to be the

[ Page

2507 ]

taxpayers' money. It belongs to all of us. You're trustees of that money only.

The president of the mining association also said, Mr.

Speaker, that whoever wrote this Act didn't know a thing about

the industry. It was written by a "socialist theorist." Those

are his words and he's right on, Mr. Speaker, right on. Because

the basis of this legislation is what is good socialism, not

what is good legislation or not what is good for the mining

industry. It's all based on what is good socialism.

MR. GARDOM: Old-fashioned socialism.

MR. McCLELLAND: Old-fashioned socialism it may be.

Mr. Speaker, he's not in the House at the moment, but the

Member for Oak Bay (Mr. Wallace) earlier today said that

business doesn't trust government, whether it's NDP or Tory.

Well, I don't buy that, Mr. Speaker, for one minute. I think

business will trust government if government earns that trust

and if you give them something to trust. Mr. Speaker, this

government is giving them nothing to trust and nobody trusts

them any longer.

MR. SPEAKER: The Hon. Minister closes the debate.

HON. MR. NIMSICK: Mr. Speaker, the last speaker said that we

did not listen. The previous speaker — the former mines

Minister — I appreciated his remarks very much. He said

there was a committee working with the industry. That committee

continued to work and it's still working towards the complete

review of the Act. So when you say that it was sidetracked, I

don't know where you've been. Somebody has been giving you the

wrong information.

When you speak of the mineral industry as a big revenue

producer to the government, I don't know how you figure it out.

When you figure out the direct revenue to the government and

subtract from that what we spend in the mining industry, we get

about 2 per cent revenue from the mining industry.

You spoke of the copper being low. When I came in copper was

47 cents a pound. Today it's up over 60 cents a pound.

Molybdenum is on the increase. When we speak of the prospector,

I've got every sympathy for the little prospector. There are

very few of the little prospectors left.

MR. PHILLIPS: There's over 1,000 of them.

HON. MR. NIMSICK: When I find some prospectors tell me

they've got 100 claims which is 5,500 acres of land, I think

that either they've got more claims than they need or they're

working in conjunction with some big company. Because most of

the prospecting today is done by air.

When you speak of Mr. Kierans, he had no input into these

amendments at all. So you might as well rest yourself there

because I have never read any articles from Kierans before

these amendments were put forward.

When we talk about equity, I remember Mr. Gibson in this

House, the former Liberal Member, when he advocated that we

should have an equity in all our forestry management licences.

He advocated that, that we should have an equity because we own

the resource, and in regards to mining, what would be wrong

with the people that own the resource having an equity? If any

one of you, or any one of us owned a mine, and it was going

to enter production, somebody wanted to put it into production,

the first thing we would ask him is, "What is in it for us?"

And we as the people of British Columbia, we want to know what

is in it for us, if we are going to let these mines out.

Interjections by some Hon. Members.

HON. MR. NIMSICK: It is a two-way street in this thing, and

some people believe in participatory democracy, you know, and

there is a two-way street, when you are discussing these

things. Just the same as a private individual and a company we

are discussing this back and forth. But why not do it that

way?

The Hon. Member for Victoria said that we have 14,000 men

working in the mines. We had that many two years ago, and we

produce a lot more minerals today than we did then. So actually

as a job producer, the resource industry of mining doesn't

produce the jobs that it should be producing, and with the

automation that is coming on, it takes more tonnage every year

to give one man a job.

The Hon. Second Member for Victoria was talking about the

Waffle manifesto. I've been in this movement long enough that I

could write a manifesto myself; I don't have to wait for any

professors. I don't have to wait for a professor to hand me a

Waffle manifesto. I can write a manifesto.

Interjections by some Hon. Members.

HON. MR. NIMSICK: I would like to get the record straight,

Hon. Member for Victoria. I'd like you to have the record

straight. The other day when you asked me about whether we had

anybody working in regard to setting up a Crown exploration

corporation, I said "No", and that was correct.

Last fall I had an interest in it, I mean I discussed the

matter about having an exploration company, because I think

there is merit to it. But at that time we were so busy, so we

dropped it. And it might come up again, so don't be too worried

if it does come up again and we have such a corporation.

[ Page 2508 ]

Then we talk about the power of government. It's the highest

court in the land, don't forget. Government has power, and you

know that. You know government here can do almost anything if

they want to. But they won't last long if they don't do the

right thing. (Laughter). They won't last long.

I was surprised at the Hon. Second Member for Victoria (Mr.

D.A. Anderson) when he talked about creaming of the mines, and

the life of the mine, and taking out the low-grade ore along

with the rich ore. That's exactly what this bill is all

about.

Interjection by an Hon. Member.

HON. MR. NIMSICK: All you've been doing is reading the

stories and the letters and the briefs from the mining

industry. And how would you get anything else out of it? You

wouldn't get anything else.

Interjections by some Hon. Members.

HON. MR. NIMSICK: And they can read sinister things, anybody

can read sinister things into anything, and I don't care what

kind of

an Act you bring up here, or a bill — somebody

can read something sinister in it. That you are really plotting

something beyond what you intend. They try and read between the

lines.

Well, I'm one of those straightforward fellows and what I

put down I intend to follow.

AN HON. MEMBER: But you won't be there forever.

HON. MR. NIMSICK: When you're going into these leases that

we're talking about, these production leases, there's nothing

in the Act and nobody mentioned it. I couldn't find anything in

the Act saying that we would stop a production lease, providing

they fulfil all these plans.

Interjections by some Hon. Members.

HON. MR. NIMSICK: Well, what are we going to do? What are we

going to do if we don't have some regulations. If we don't have

some place where we know how they are going to operate —

then there's no use in our trying to be a government. Don't

forget that. We want some input into this, and I think the Hon.

Minister of Health was right when he said we are trying to get

a balance.

This is the first time that the citadel has ever been

breached, and it's going to be breached. The people of British

Columbia are going to have a say in the depletion of this

resource.

AN HON. MEMBER: Let's give some marks for the old days.

Interjections by some Hon. Members. (Laughter).

HON. MR. NIMSICK: Listen to the industry? I've been

listening very carefully to the industry, and the more that

they came up the more convinced was I that I am right in regard

to this bill and the production leases that are in this bill.

The more I'm convinced I'm right.

And listening to some of those long speeches today, at the

start I might have been teetering a little bit, but after they

got through the four hours I was sure I was right.

Interjections by some Hon. Members.

HON. MR. NIMSICK: Now they talk about stockpiling ore. Is

the government going to stockpile ore? Well, I wish to goodness

we had a stockpile of a million tons about six or eight months

ago because we'd make some money on it today. So that would be

fine.

Now, Mr. Speaker, I've enjoyed this debate. (Laughter). At

least the last 10 minutes of it. (Laughter). And the

information that I got from across the way since the debate

started, I'll be able to give that consideration in the next 10

minutes. And with that I'm going to move second reading of this

bill, Mr. Speaker.

Motion approved on the following division.

YEAS — 32

Macdonald

Barrett

Dailly

Strachan

Nimsick

Stupich

Nunweiler

Nicolson

Brown

Radford

Sanford

D'Arcy

Cummings

Dent

Levi

Lorimer

Williams, R.A.

Cocke

King

Calder

Hartley

Lea

Young

Lockstead

Gorst

Rolston

Anderson, G.H.

Steves

Kelly

Webster

Lewis

Liden

NAYS — 15

Richter

Bennett

Chabot

Jordan

Smith

Fraser

Phillips

McClelland

Morrison

Schroeder

Anderson, D.A.

Williams, L.A.

Gardom

Brousson

Wallace

PAIRED

Hall

McGeer

Barnes

Curtis

Bill No. 44 referred to a committee of the whole

[ Page 2509 ]

House at the next sitting after today.

HON. MR. BARRETT: Second reading of Bill 47, Mr.

Speaker.

MINERAL PROPERTY TAXATION ACT

REPEAL ACT

MR. SPEAKER: The Hon. Minister of Mines.

HON. MR. NIMSICK: Mr. Speaker, nobody needs to worry much

about this bill. This bill is the Mineral Property Taxation

Act Repeal Act. It's

an Act that was passed by the Social

Credit government back in 1957, I believe, with the hope that

they could get some taxes out of our Crown-granted mineral

claims. It went to court and it was ultra vires.

So there's no use leaving it taking up room in the book. I

move second reading of this bill.

MR. SPEAKER: Any debate?

MR. D.A. ANDERSON (Victoria): Mr. Speaker, this is the first

Act we've had which cuts a tax, even though it's an ultra vires

tax. (Laughter). We'd like to say that this is a principle that

we approve of. Furthermore, it saves paper, which is

conservation at its best.

So we hope that even though this Act didn't raise any money

and it's ultra vires and it's thoroughly useless, the principle

of cutting taxation, or at least considering it, will hit home

in the government in other taxes which hit people a little

harder. We trust that this is simply the one very, very narrow

bit of silver lining on a very dark cloud which is coming from

the Minister of Finance. We certainly approve of this.

MR. SPEAKER: May I say that was the Hon. Second Member for

Victoria, in case Hansard wondered. The Hon.

Premier.

HON. MR. BARRETT: After that speech, I want the Minister to

reconsider his position. (Laughter).

HON. MR. NIMSICK: Question, Mr. Speaker.

Motion approved; second reading of the bill.

Bill No. 47 referred to a committee of the whole House at

the next sitting after today.

HON. MR. BARRETT: Second reading of Bill No. 64, Mr.

Speaker.

MINERAL LAND TAX ACT

MR. SPEAKER: The Hon. Minister of Mines.

HON. MR. NIMSICK: Mr. Speaker, Bill 64 is the Mineral

Land Tax Act .

HON. MR. BARRETT: Is it ultra vires too?

HON. MR. NIMSICK: This is the dark cloud that was just

coming up over that silver lining that he was talking about.

(Laughter).

This is a tax that we're going to place on privately-owned

mineral rights. There are 9,600 Crown-granted mineral claims

comprising about 300,000 acres in the Province of British

Columbia. In addition to this, there are over 8 million acres

of railway grants where they have the right to the

minerals.

We propose three tiers of taxation. The first one …

AN HON. MEMBER: T-e-a-r-s. (Laughter).

HON. MR. NIMSICK: The first tax would be on the total area.

It would be from 25 cents to $1. If you owned over 1 million

acres of land, you'd have to pay $1 an acre. If you owned a

small amount of land, you'd have to pay 25 cents per acre in

tax.

Within the total area there are producing areas. These are

potentially producing areas invariably surrounding production

areas. The tax on these would be $2 an acre. This is in the

Act.

Then there are production tracts. This is where there's a

producing mine. The tax in this regard, for the first year

after the Act goes into operation, would be a maximum of 12 1/2

mills. The second year it would be 25 mills. That's the highest

it can go under the Act. This is outlined within the Act.

There is an appeal board where you can appeal your

assessment, because this 12.5 mills is against an assessment

that will be designated by the administrator. It will be based

on the production of minerals. There is also tax deferment in

regard to this production tract. If a mine is operating on a

margin or at a loss, the tax payment can be deferred from year

to year by application to the Minister. It would become a debt

against the mine, but grounds for deferment would have to be

shown.

Mr. Speaker, this is the first time that we are trying to

get some return from the mistakes made many, many years ago

when we alienated great areas of our province. That's the

mineral rights. Some of those mineral rights in Crown-granted

claims are being held for generation after generation. Nothing

is done with them but they're being held because they're Crown

granted. Now we are in hopes that many of those will come back

home if they've got to pay some tax.

I move second reading of this bill.

MR. SPEAKER: The Hon. Member for South

[ Page 2510 ]

Peace River.

MR. PHILLIPS: Thank you, Mr. Speaker. Just a few words in

passing on this bill. I want to say that I certainly enjoyed

the Minister's closing remarks on Bill 44. They were pretty

humorous. But the smile will soon disappear, Mr. Speaker, when

the realities come home to roost and the popcorn starts to

pop.

Mr. Speaker, before discussing this bill, I have to say at

the outset that it's another one of these bills that's 14 pages

long. A fantastic note of explanation at the back of it says,

"This here enacts the bill…(Laughter)…and does not

become part of the bill." However, Mr. Speaker, maybe someday

when the Government introduces some of its legislation, they'll

put a few explanatory notes on it for laymen like myself.

Another thing that's familiar in this bill, Mr. Speaker, is

the right of the Minister and his colleagues to designate. This

seems to be following pretty well along the same course of all

the legislation introduced this session.

The only problem that I can see with the bill — and I

think that the Minister's probably right in respect to some of

the old treaty land and taxing. I'm not going to say that I

disagree with that. However, it's another case of while you're

getting some revenue from those lands, you're also going to

hurt the most crucial area of resource exploration by other

companies.

It radically raises charges on active explorers, whether

inside or outside of this railway belt. For example, a company

exploring on 40 claims of land in an area designated as highly

mineralized, but not necessarily producing, might currently be

paying about $400 per annum for its lease on top of its

exploration costs. Bill 64 would put this up to $3,200. Many

companies, particularly the smaller ones, could not bear this

charge for property that would still be a long way away from

producing.

So this is an area that hurts, Mr. Speaker. It also may

prevent key exploration in marginal areas. Companies will think

twice about picking up and doing work on claims that are

anything less than high grade.

Mr. Speaker, the bill also leaves the implementation wide

open to inequities. The designation of each of three types of

mineral area is far too arbitrary, Mr. Speaker. It's that great

power of the Minister again. The legislation gives the power to

the cabinet to designate any portion of the province as

ordinary mineral land, as a production area or as an active

production area. This power of designation can have a

detrimental effect on developing mines. This takes away, Mr.

Speaker, the counterbalancing forces of cost, supply and demand

as factors in the development of a land holding and inserts

instead the arbitrary judgment of a politician.

It does nothing to increase the number of claims that would

be worked under the old rules. But it will obviously

economically veto ones that might have been worked but now get

over-optimistically classified, Mr. Speaker. Ore bodies that

are marginal in a generally producing area may get punitive

treatment.

HON. MR. NIMSICK: How?

MR. PHILLIPS: Because of your power, that's how.

Interjection by an Hon. Member.

MR. PHILLIPS: No, it's not. Most companies control a range

of ore bodies whose development into mining status depends on

trends in prices and costs. The Act will …

AN HON. MEMBER: Author, author.

MR. PHILLIPS: You're looking at him. (Laughter).

The Act will penalize companies for holding bodies which it

is not yet economic to develop, but in which the company has

invested great sums of money to find and prepare. This is the

ultimate blow to the mining industry in British Columbia, Mr.

Speaker. I have to quote the secretary of the B.C. and Yukon

Chamber of Mines …

SOME HON. MEMBERS: Oh no!

MR. PHILLIPS: An

article in the paper …

AN HON. MEMBER: Who wrote it?

MR. PHILLIPS: Don't be so quick to jump. I mean, my gracious. You go

ahead and laugh. I'm quoting him when he says, "Do you think anyone will be

nutty enough to invest money in B.C. mining now?" Now go ahead and laugh,

HON. R.A. WILLIAMS (Minister of Lands, Forests and Water Resources):

That sounds like you.

AN HON. MEMBER: You're on the wrong bill.

MR. PHILLIPS: No, I'm not on the wrong bill at all.

AN HON. MEMBER: Sure you are. We don't give Crown

grants.

MR. PHILLIPS: As a matter of fact, I'm going to say

something good about the Government in just a few moments, or

I'm going to quote somebody who said something good about

it.

[ Page

2511 ]

HON. MR. BARRETT: Now we know you're on the wrong bill.

MR. PHILLIPS: Yes, I'm on the wrong track too. But I'm

fairly serious about this.

It's another taxation statute, Mr. Speaker.

HON. MR. BARRETT: It's on Crown grants.

MR. PHILLIPS: No, just a minute. Here's the Premier butting

in and interrupting me again because I think I've found the

truth behind this bill. That is the power of the cabinet to

designate any type of production area, to designate what the

taxes shall be. That's the …

HON. MR. NIMSICK: Wrong. Privately-owned mineral lands.

MR. PHILLIPS: I know it's privately-owned mineral lands. I'm

well aware of that. I want to quote just shortly and briefly

from an Article. It's from the Vancouver Sun dated March 30. It

was on the financial page. It says: "Mineral Land Tax Hits

Railways," which is, as I say, no problem. "Millions of

CP-CN Acres Hit by New Legislation." This

article quotes Norman

B. Keevil, Jr., executive vice-president of the Vancouver-based

Tech Corporation Ltd., who has met Premier David Barrett. He

said:

"Two of the toughest jobs in today's world are running a

mining business and running a government. Too many people in

the mining industry fail to recognize that Mr. Barrett and his

band are sincerely trying to do what they think is best for the

province."

That's what this man says. The problem is, of course, what

they think, based on their philosophy. This is where the man is

not quite right.

"For their part though, I think too many of the NDP fail to

recognize the equal sincerity and good intention of the mining

industry at large and consider it populated only by rip-off

artists."

There's the problem. Because every time the Minister or the

Premier stands up, we've got to damn business, we've got to

damn profits. This is where they're wrong.

AN HON. MEMBER: Damn rivers.

MR. PHILLIPS: Rivers? Well I wish we could dam your

river.

"For their part though, I don't think there is any need for

the industry and government to join in a fight to the death.

Instead, they could get together and work out a set of policies

that are good for the province."

That, Mr. Speaker, is exactly what I recommended this

afternoon. But they're not doing it. They bring in their

legislation in a dictatorial manner. They're not going to

listen. They're not willing to change it when they find out

what the reaction is, particularly on Bill 44.

AN HON. MEMBER: Did we come back to listen to you for four

hours?

MR. PHILLIPS: No, I'm just about finished. I said more in

that four hours than you've said in all the time you've been

sitting here in the Legislature for the last 30 or 40 years.

How long have you been here? (Laughter).

Mr. Speaker, this

article goes on to say: "What is good for British Columbia

in the long run is good for the mining industry too. At the same time, what

is bad for the mining industry will be even worse for the province."

This is from a man who is looking unbiasedly at the

government and how they're handling the mining legislation.

It's unfortunate that the Government opposite, Mr. Speaker,

does not realize this.

"Keevil suggested both the mining industry and the

government throw away the chips on their shoulders and get down

to serious, quiet dialogue."

What did I recommend this afternoon? I said there had been

animosity created by this government in the mining industry.

Don't tell me, Mr. Speaker, that there hasn't been because I've

seen it. I've listened to it.

" 'If the government doesn't like the old rules of the game,

then perhaps new ones can be worked out that are both fair and

productive.' The Tech executive said the new tax legislation

and the amendments to the Mineral Act could be set aside

for a time and the powers used for a frank exchange of ideas.

'Both the industry and the NDP might be pleasantly surprised at

what could be accomplished by this.' "

I'll make the same request about this bill as I requested

about Bill 44. There are things in this bill that are going to

be detrimental to certain mining exploration companies. I think

before you get out the big stick to beat around those railway

lands and the big companies that are in them, you should take a

real, honest and sincere look at how it's going to affect the

smaller companies as well, Mr. Minister.

I know that the Minister, being a conscientious man, will do

just exactly what I have asked him to do.

Thank you very much, Mr. Speaker.

MR. SPEAKER: The Hon. Second Member for Victoria.

[ Page 2512 ]

MR. D.A. ANDERSON: Mr. Speaker, this is another of the

mining taxation Acts for which no justification has been given

in terms of the need to raise revenue. The object must be

elsewhere as we have, of course, a surplus, a substantial

surplus, and if the object were to raise revenue I would like

to see at least companion legislation elsewhere reducing

taxation elsewhere.

We appreciated the Minister's previous bill, where he pulled

back on a taxation bill which, of course, had never been in

force.

HON. MR. NIMSICK: I appreciated your remarks.

MR. D.A. ANDERSON: He appreciated my remarks. Well, the

irony of it is that the fellow who sits next to him, the

Minister of Agriculture (Hon. Mr. Stupich), put in a bill which

he told us was ultra vires in the House, and then asked us to

vote for it about a week ago. A very strange situation. I trust

the Minister of Mines will talk to his colleague. The Minister

of Mines is more clearly concerned with the constitution than

the Minister of Agriculture. But that's by the by.

This is another mining tax and the effect of it is to tax

minerals in the ground, as far as I can see.

Interjection by an Hon. Member.

MR. D.A. ANDERSON: Well, it may be the only one, but there

are other things in your other legislation, Mr. Minister. I

appreciate your comments. There are other things in your other

legislation which I've commented upon which have the effect of

raising costs for companies in the mining business.

The effect of taxing people who own land and who have

minerals on that land is, of course, the exact reverse of what

we understood was Government policy when they said, "Look, if

this generation doesn't know enough about it, some future

generation will, and we don't care if it's kept in the

ground."

Now you're putting an incentive on getting it out of the

ground fast.

The Minister shakes his head. But what is the other thing

that you can read into it? What other

interpretation can you

read into this bill when on a year-by-year-by-year basis you're

taxed if you leave it in the ground. You're taxed if you don't

exploit it. If there is any other explanation for

section 4 of

this Act where it says "Mineral Land Tax" then I'd like to know

it, because the Minister certainly hasn't given it to us

now.

I'm simply delighted to see that he's picked up the bill and

is now about to read

section 4 once he turns the page and

finishes with

section 1.

The fact of the matter is it seems totally contradictory in

terms of what you've told us in the past.

You've said that it's better to leave it in the ground if

this generation hasn't got the brains to use it properly.

That's a reasonable point of view. Now you turn around and you

say that when you leave it in the ground we'll tax you. Thus,

you are making an incentive for early exploitation, because

there is no other way you can interpret such a provision as is

section 4. Of course

section 5 goes on to tell you that

once you get going in your production you won't have to pay

taxes under

section 4, under the minerals-in-the-ground

provision.

I don't really know what's in the Government's mind. It's

getting more and more confusing. They load taxes and

regulations and open-ended blank cheque legislation on the

mining industry, and items such as this one. It's totally

contradictory to what they've told us in this House and the

mining industry and the public outside this House, as to what

their intention is for this particular industry in this

province.

Mr. Speaker, we just don't see that there is any reason to

vote in tax measures of this nature when they are not explained

at all adequately in the terms of the need and when there is no

countervailing reduction in taxes elsewhere if this is to be

revenue generating tax; when the objective appears not to be to

raise revenue but to force exploitation.

So we, again, find it very difficult to accept this one.

With regret to our friend the Minister, we're going to have to

vote against it.

I would just like to give him one word of praise …

Interjection by an Hon. Member.

MR. D.A. ANDERSON: I voted for your last one. Were you

relieved?

I would like to give him a word of praise when we get down

to the provisions for the Tax Review Board. There at least this

Minister appears to have heard the voices of this side of the

House when dealing with procedures before boards. "To an

extent," my Hon. friend from Point Grey suggests. That's

right. At least there is a suggestion there that procedures

should be set down not by the board itself — that's the

review board, before whom the poor people who are affected will

have to appear — but by some other body which, in this

case, happens to be the Lieutenant-Governor-in-Council.

It's not much of a step up, because we don't have much faith

in the Lieutenant-Governor-in-Council at this stage. Much as we

like his Honour, we think he is badly advised. The point I

would like to make is that we do appreciate the fact that at

least you've got away from having the same board to whom people

have to appeal making the regulations, making the procedures

for those people who have to appeal. And that's a step up.

[ Page 2513 ]

Apart from that there is not much to be said in favour of

this Act, although we have read it very carefully. We would

like in the Minister's summing up a far more detailed

explanation of why the revenue is needed — if it is a

revenue statute. If it is not, why is there this deliberate

attempt here to force production early when the Government, and

in particular the Premier, have been making statements which

are quite contradictory to what is the purpose of this Act?

MR. SPEAKER: The Hon. Member for Oak Bay.

MR. G.S. WALLACE (Oak Bay): Mr. Speaker, this party opposes

Bill 64 for basic reasons that we've mentioned in relation to

other bills.

First of all we see no need for this kind of tax. If there's

any doubt that it is a revenue-producing Act, the figures which

have been released to the media by the Minister show that it

should raise $12 million to $15 million in 1974 and $20 million

to $25 million in subsequent years. That's a substantial amount

of money.

The other basic principle on which we reject the bill is the

sweeping power to designate, in sections 2 and 3, for

production areas and production tracts. It's really

unbelievable that you can designate an area or a piece of land

which is deemed to contain or possibly contain minerals. This

seems to us a very sweeping power, simply a form of taxing the

particular owner of the land, the private owner of the land,

with the mineral rights.

So these are the basic reasons we oppose the bill: there is

no need for this tax money in our present economy; secondly,

some of the sections give complete power to the cabinet to

designate land.

MR. SPEAKER: The Hon. Member for Boundary-Similkameen.

MR. RICHTER: Mr. Speaker, this particular piece of

legislation is most distasteful to myself because I think it is

very poorly titled. I think that this Act should be known as

the "Confiscation of Crown Granted Mineral Claims." You didn't

repeal any confiscation legislation.

We will likely have an amendment to that effect when the

time comes in committee. However, it is the instrument and an

implement which will be used by the government to acquire

possession of titles to Crown-granted property. It is not

unlike a former bill that has had second reading in this House,

and that is Bill 42.

I question the legality: however I could be wrong because I

am not a lawyer. The Minister said Bill 47 was ultra vires.

You're dealing here with railway lands which were acquired by

the railway for certain undertakings from the federal

government. I question the authority that the province would

have in relation to those mineral rights under the railway

lands. However, that remains to be seen when the time comes

— certainly the legislation as it stands in relation to

the titles.

These titles were acquired in a way not dissimilar to those

under the pre-emption legislation and homestead legislation

that grants to land were acquired by proving the land up in the

past.

These mineral properties were granted a title by the fact

that they did so much work to acquire the title to these

grants. Then they didn't receive them free, in any fashion

whatsoever, because they had to pay taxes on them.

Consequently, they were not a form of tenure in which if the

taxes lapsed they lost their properties.

Now we have freehold tenure too. We have a number of types

of tenure of mineral lands. I just wonder how this legislation

is going to affect the other types of tenure.

The legislation is obviously aimed at such organizations as

Cominco, who have a Crown grant of mineral claims, the Kaiser

Coal Mines, the CPR and many other holders of Crown grants of

mineral claims.

Now it isn't always feasible to develop a mineral claim in

light of the fact that the metal market may not warrant the

development of it. You are adding additional taxes to those

already on the land, such as the school tax, land tax, regional

district tax, hospital taxes, library taxes — you name it

— sales taxes as far as equipment is concerned if they

are developing the property.

You're going to have the mineral industry, the Crown granted

properties, loaded with so many taxes it will be obvious that

you will be in possession, which is the ultimate aim of the

socialist government — to control all the land. That is

their philosophy, their socialist philosophy. This is the way

they feel — they can control the people once they control

the land.

In my own mind I can't see any fairness in bringing in such

a tax as this against properties that have been acquired over

the years. Granted, they may have been handed down from

generation to generation, but many pieces of agricultural land

and other properties have been handed down from generation to

generation when a title in fee simple was held by the original

family or some of the generations that followed.

[ Page 2514 ]

I don't know how a mining industry in the Province of

British Columbia can survive. Every particular segment of it

has been hit in one way or another. Certainly, if there was any

encouragement to be given to the mining industry, I would have

thought that because of its contribution to our economy, it

would be encouraged rather than deterred and discouraged as is

being done in Bill 64.

There is so much that could be said about this piece of

legislation. There has been so much comment by economists, by

the general public who understand the mining industry, and by

the professional people in the mining field. I might just quote

from one accounting firm who have made a study of it. They

title it "The Mineral Tax Act" and they say:

"The Mineral Land Tax Act is an extremely bad piece

of legislation in that the taxpayer is not informed as to how

much of his holdings of Crown-granted lands are to be taxed,

under which system of tax rates and which of his minerals will

be subject to taxation.

"The Lieutenant-Governor will designate the areas within the

province that are to be taxed as mineral lands, production

areas or production tracts. An administrator, to be appointed

by the government, will determine the value of a mine prospect

or claim or resources on the basis of the designated mineral

content, or deemed content, and the value placed upon the

designated mineral designated by the

Lieutenant-Governor-in-Council.

"There is no appeal against the assessment other than to an

appointed review board. Tax costs to individual mines,

prospects, claims, or just land held under Crown grant cannot

be estimated until the regulations are published."

And this is obvious, again, that we have the lack of

legislation or regulations to guide the industry in exactly

what is happening.

Now, another firm — and it's not a mining firm —

concerned with this land tax made a radio programme on April 2,

and they stated this about the B.C. Mineral Land Tax

Act;

"On Friday, the new B.C. Mineral Land Tax Act came

into our hands for the first time. It is labelled Bill No. 64

and was introduced to the B.C. Legislature on Thursday.

Normally, we wouldn't comment on the tax bracket to any extent

on a bill of this nature because of its application to a

limited segment of the community.

"However, on Friday we reacted with immediate disapproval

because of the way in which the law was formulated, not because

of the tax the law was imposing. On more careful study over the

weekend our immediate reaction seemed more than justified.

"The problem is that the bill delegates most of its taxing

authority to others, so who is going to be taxed and by how

much will not be determined by the elected Members of the

Legislature. As we see it, the bill can tax any lands other

than Crown land where any mineral is or may be situated."

That's pretty broad and I think there is an error there in

their

interpretation of the bill because it is aimed at

Crown-granted land.

"It seems to us it would apply to almost any privately-owned

land in B.C. because of the words 'where any mineral may be

situated.' "

Now this might be right on a farm. At one time my family

owned coal rights on an area in Princeton; with the conveyance

of title, those rights were relinquished some years ago. But

this is a case where it is agricultural land — that was

its use — and as far as the mineral was concerned, no

production was made of that mineral because it didn't have the

quality with which to make it a viable undertaking to

extract.

"If an order-in-council is issued — by the way, this

does not require any further approval of the Legislature

— any such land can be designated to lie in a production

area. In that case the tax to be levied would be much more

severe.

"To take an example, if a B.C. farmer or rancher with 100

acres is considered to own land on which a mineral may be

situated, he will pay a tax under the bill of only $25 an acre

for a total of $25 per year."

However, that's in the Act …

HON. MR. NIMSICK: Twenty-five cents an acre.

MR. RICHTER: For a total of $25 for a hundred acres, that's

right.

HON. MR. NIMSICK: That's if he owns the mineral rights.

MR. RICHTER: If he owns the mineral rights.

[ Page 2515 ]

That's the example that's given.

"However, if he is unfortunate enough to be located in an

area designated by an order-in-council to be a production area,

this tax will jump to $2 per acre for a tax of $200. In

addition to this tax of $200, an administrator will have the

right to determine the value of the designated mineral land,

and based on this value a further tax not exceeding $25 per $1,000 value will be levied. While this further tax has a limit,

the actual rate of tax is to be set by an order-in-council.

"It is probable that this new tax statute will only be used

to tax a very few individuals and companies in B.C. But

nonetheless, the principle of elected representatives passing a

taxing statute which could be applied on a broad basis by the

administrator's whim is incorrect. The taxpayers already bear a

substantial burden of taxation in one form or another. It is

not too much to expect that any further tax asked for should be

specifically set by the Legislature, not left uncertain, subject to administrative manipulations."

These are the fears of people who own land. These are the

areas in which the greatest amount of concern is being shown at

the present time.

Certainly, if I owned title to a mineral claim and the time

was not right to develop that claim, I would feel very

disturbed that I would not have the opportunity to develop that

in due course when the mineral market was right. But to bear a

substantially higher tax on that because of designation —

and this again is the principle that was in Bill 42. It is by

designation in which the title to this property could pass on

to the government, which is the ultimate aim under this type of

legislation and under the philosophy of the socialists.

MR. SPEAKER: The Hon. First Member for Victoria.

MR. N.R. MORRISON (Victoria): Mr. Speaker, I rise in

opposition to Bill 64. As I understand it, by definition this

Act applies to mineral lands and excludes Crown-granted land

and some land used in railway operations. But the specific

reference to right-of-way, station ground, yard or terminal of

a railway shows to me the intent is to get at the CPR and the

CNR operating in British Columbia.

[Ms. Young in the chair.]

It also applies to mining companies who own their own land

in fee simple, rather than through ordinary mineral claims. And

the main substance of this Act in its many references to

orders-in-council and regulations yet to be issued — and

that's one of the things that concerns me — the

orders-in-council and the regulations which are not spelled out

in the Act.

Again, in this Act the government has the power to

designate, and the rate of tax is subject only to the overall

limit of 25 mills, which is 2.5 percentage points of the

designated mineral land. As I see it, therefore the Government

has a choice whether the tax will be substantial or very

small.

We have

an Act where the tax is actually undeterminable. I

don't know how you're going to figure it out. The rate of tax,

namely the mill rate, is not spelled out. The tax base, that is

the assessed value, is impossible to determine.

This Act gives the government very broad taxing powers. Most

of those powers are delegated to regulation within this Act

— again, another possible blank cheque for the

Government. It could, if it wished, impose taxes so onerous as

to result in confiscation of mineral rights and mining

properties.

As I understand this Act, the assessment is mailed on May 1.

In that assessment there will be information as to which parcel is taxed and how that parcel is to be assessed and how to

appeal the assessment. That is to be mailed out by May 1. But

if you wish to appeal the assessment, you must reply not later

than May 15. In that reply you must give complete reasons for

the appeal.

I think this is an extremely short period of time. At most,

it is 15 days. In reality, with mail being the way it is, it's

probably something in the neighbourhood of 10 or 11 days, in

which they must get the assessment and they must reply, and

they must reply in full. I think that this is clearly

insufficient time. Slow mail reduces that time period, as I

said. As a matter of fact, this is a great deal shorter time

than is generally granted in most other taxation statutes. Most

other statutes allow at least 60 to 90 days for reply.

If they choose to appeal, they appeal initially to a board

which is established by the Government. It can consider

questions about fact and about law. But if he chooses to go

beyond that board, he can appeal only to the supreme court and

only on questions of law raised before the board.

Another item which I'd like to bring to your attention is

the interest. There is a charge of 9 per cent on unpaid taxes.

I believe that this is an excessive interest. I don't know of

any other tax interest in B.C. which charges 9 per cent. I also

want you to notice that if you do by happenstance overpay,

again no interest will be paid to the person on the

overpayment.

[ Page 2516 ]

Interjection by an Hon. Member.

MR. MORRISON: Well, I think that it's a little unusual to

see a 9 per cent interest charge on unpaid taxes.

When we get to the penalties for failing to pay, this

becomes really very serious. If the tax is not paid, then all

work may be stopped until the tax is paid. If the tax is not

paid by August 1 of the year following the year in which it is

assessed, then the mineral lands may be forfeited. They're

forfeited 90 days after publication of forfeiture notice in the

Gazette, but without any requirement of direct

notification to the party concerned. The minerals and the right

to take the minerals are then forfeited to the Crown. I believe

that this is a very short period of grace with respect to

unpaid taxes. To me, it certainly smacks of confiscatory

intent.

If the tax is levied, it also forms a lien and a charge upon

the property. The lien apparently does not have to be

registered. It will apply not just to that particular piece,

but to all mineral lands owned by a particular owner. This

unregistered lien on all properties will, I think, make

financing of mines very difficult, particularly when you're

dealing between mining companies and between other parties who

might want to be negotiating with them. There's no way that

those liens can be properly searched and recorded. It's

extremely difficult for them to know whether or not there are

liens there, particularly without notification.

Again in this Act we find these strong powers of search and

seize. Any person authorized in writing by the Minister may

enter any land, any premise or place and inspect any property,

including books, writings and other documents. These are very,

very strong words again. He has the power to seize those books

if he feels an offence has been committed. Furthermore, he may

require the owner or persons in charge to give all reasonable

assistance and answer all proper questions. He may also,

apparently, enter the offices of an accountant, private

businessman, private home, whatever, for the purposes of

enforcing this Act.

I think that these are extremely broad powers in view of the

limited application of this Act.

The Government has two courses open to it in the event of

unpaid taxes. First of all, by July of the same year in which

taxes are levied they may seize all goods and chattels

belonging to the owner in order to satisfy the taxes and

interest thereon. Secondly, they can wait until August of the

year following and, in effect, seize all the mineral lands

belonging to the owners.

In view of the possible prohibitive taxes which could be

levied, the danger of outright confiscation of property

contained with this Act is obvious.

AN HON. MEMBER: Who are you quoting from?

MR. MORRISON: This is my own, thank you. I'm not quoting

anybody.

At this time many mining companies will not be affected

because, as I said, this Act only applies to property which is

owned in fee simple. But presumably, similar legislation is to

be enacted with respect to mineral claims on Crown land. The

uncertainty and the ominous overtones of this Act will do

nothing to encourage the mining industry within this

province.

DEPUTY SPEAKER: The Hon. Second Member for

Vancouver–Point Grey.

MR. GARDOM: I'd like to make a few short points here, Madam

Chairman.

Dealing first of all with the dollars and cents, we see from

the statements issued under the hands of the Minister that

there is eventually an anticipated $25 million tax revenue.

There is no indication from the Minister as to where that's

going to go. There's no indication from the Minister as to why

that is necessary. This is just another example of the

overtaxing direction of the New Democratic Party.

Secondly, the Premier has often stated in the province that

he wishes to do business with industry. I think that's baloney.

What it seems that he wants to do is business against industry.

This was certainly very clearly indicated in the remarks of the

Minister of Mines when he spoke a little bit earlier

tonight.

We see three great powers of designation here. First of all,

there's the power of the government to designate pretty well

anything as a mineral, to designate any part or the whole of

B.C. as a production tract. That's almighty control. There's

not any appeal against a governmental decision there to any

board. There are fantastically wide powers of designation.

It's totally a control bill. I think it could well forecast

the death knell of the private-sector miners and perhaps

tax-bleed them out of existence. We've seen an example of the

power of this government to attack and economically emasculate

an industry. That's the insurance industry. You've done that

without any compensation. You've put them right out of business

by snapping your fingers. Insofar as this bill is concerned, it

seems that you could well be contemplating a slow death for the

mining industry in B.C.

DEPUTY SPEAKER: The Hon. Minister closes the debate.

HON. MR. NIMSICK: Madam Speaker, when I wrote this bill up I

didn't figure there would be too much discussion.

Interjections by some Hon. Members.

[ Page 2517 ]

HON. MR. NIMSICK: That's why I didn't put too many

explanatory notes at the end of the bill. But don't forget that

this only applies to privately-owned mineral rights. There is

land right on this island, part of the E&N land, where they

sell the surface rights and keep the mineral rights. They

charge the people who bought that land because they're using

the land over top of the mineral rights.

[Mr. Speaker in the chair]

These people will be taxed for their mineral rights, and why

shouldn't they be? If a farmer owns land that has mineral

rights under it and he owns the mineral rights and if he

doesn't want to pay for those minerals rights — there may

be no minerals under them but he has the rights — all he

needs to do is to revert it back to the Crown.

Interjection by an Hon. Member.

HON. MR. NIMSICK: No, I won't. The people will. That's all

he needs to do. As I say, there's a lot of land in the province

where the surface is owned in one case, the mineral rights are

owned in another, and they're paying nothing for the mineral

rights. Why shouldn't they pay? This is the first time in

history that we're trying to get at these mineral rights that

are owned privately and mostly by large companies.

I move

second reading of this bill, Mr. Speaker.

Motion approved on the following division:

YEAS — 32

Macdonald

Barrett

Dailly

Strachan

Nimsick

Stupich

Nunweiler

Nicolson

Brown

Radford

Sanford

D'Arcy

Cummings

Dent

Levi

Lorimer

Williams, R.A.

Cocke

King

Calder

Hartley

Lea

Young

Lockstead

Gorst

Rolston

Anderson, G.H

Steves

Kelly

Webster

Lewis

Liden

NAYS — 15

Richter

Bennett

Chabot

Jordan

Smith

Fraser

Phillips

McClelland

Morrison

Schroeder

Anderson, D.A.

Williams, L.A.

Gardom

Brousson

Wallace

PAIRED

Hall

McGeer

Barnes

Curtis

Bill No. 64 referred to a committee of the whole House at

the next sitting after today.

HON. MR. BARRETT: Second reading of Bill No. 169, Mr.

Speaker.

AN ACT TO AMEND

THE PLACER-MINING ACT

HON. MR. NIMSICK: Mr. Speaker, this Act is

An Act to

Amend the Placer-mining Act . It's more of a housekeeping

Act than anything else to conform with the amendments to the

Mineral Act .

At the present time, if you go placer mining, you have to

have a miner's certificate. It's defined in the

Placer-mining Act as well as in the other Act. Now we're

just using the one Act to define a free miner's certificate.

Eventually, we hope that when the review of the Mineral Act

is finished, the Placer-mining Act will be a

Section

in the Mineral Act .

I move second reading of the bill.

MR. SPEAKER: Any debate? Are you ready for the question?

Motion approved; second reading of the bill.

Bill No. 169 referred to a committee of the whole House at

the next sitting after today.

HON. MR. BARRETT: Second reading of Bill No. 34, Mr.

Speaker.

INSURANCE CORPORATION OF

BRITISH COLUMBIA ACT

MR. SPEAKER: The Hon. Minister of Highways.

HON. R.M. STRACHAN (Minister of Highways): Thank you, Mr.

Speaker.

This is a very simple, non-contentious bill. The House has

already made a decision, Mr. Speaker, which makes it mandatory

that this bill pass the House to implement a decision already

made by the House that there be put into operation a

government operated automobile insurance scheme in the Province

of British Columbia.

Having already made that decision, the House is now being

asked to …

AN HON. MEMBER: There's third reading.

HON. MR. STRACHAN: All right. In principle, the House has

made that decision. In principle, they're being asked to

endorse the machinery in the establishment of the company, the

Crown corpora

[ Page 2518 ]

tion which will administer that automobile

insurance scheme, along with any other responsibilities that

may be placed upon that corporation by the

Lieutenant-Governor-in-Council.

The Insurance Corporation of British Columbia which will be

established under this legislation is empowered to engage in

the business of insurance and re-insurance in all its classes,

both inside and outside the province, but only with cabinet

approval for each specific class, as well as to operate plans

of insurance authorized under other Acts, including an auto

insurance plan.

This bill, Mr. Speaker, simply sets up the machinery for the

establishment of the Insurance Corporation of British Columbia.

But insurance in its broader aspects involves something more

than the payment of money after the occurrence of a loss. The

Insurance Corporation is an instrument of the province and must

concern itself with changing needs, with the prevention of

losses and with the welfare of those who have suffered

losses.

This is an area of social consequence that until now the

insurance companies that have been in operation, generally

speaking, have not concerned themselves with. This is part of

the changing needs of society, that we do have insurance

companies that will involve themselves with this broader

field.

To this end, the bill confers upon the corporation, the

necessary powers to conduct research, surveys, the promotion of

health and welfare, rehabilitation, safety and the reduction of

risk. Of major importance and of far-reaching effect to the

residents of B.C. Is the provision of the bill relating to

investments.

The Insurance Corporation of British Columbia would at all

times be the holder of substantial reserve funds. These funds,

generated in the province, will be utilized in British Columbia

by the corporation for economic development and the furtherance

of the interests of residents of British Columbia.

We expect it will be one of the major insurance corporations

of Canada. We expect it will fulfil a great need in the

province. I've indicated to you that this vehicle is necessary

for setting up of the automobile insurance plan already

endorsed in principle by this House. I indicated publicly that

the school boards of the province have been asking the Minister

of Education to find some way of helping them provide a better

measure of insurance protection in the fire field and this

corporation will be able to do that.

Mr. Speaker, as I indicated earlier, this is a housekeeping

bill. (Laughter). It is not contentious; it is necessary and

fulfils a social and economic need in the Province of British

Columbia. I have great pleasure in urging second reading of the

bill now.

MR. SPEAKER: The Hon. Second Member for Vancouver–Point Grey.

MR. GARDOM: Well, it was very interesting to hear the way

the Hon. Minister delivered his address tonight. It reminded me

a little of Dame Judith Anderson as he Lady Macbeth'd the

insurance industry.

We don't have any right to sue the Crown in the Province of

B.C. We don't have a Human Rights Act. There are not any laws

for fair expropriation. There are not any laws to provide

compensation for any individual that suffered from the very

heavy hand of a government that will totally emasculate a

lawful business, a non-polluting business, and a taxpaying

business. And the Hon. Minister talks about it being a

housekeeping bill.

I'll say it's a housekeeping bill! It's a death-house bill

for the insurance industry in B.C. I think the fairest thing to

do is for every Member in the House to stand up and bow their

heads and have two minutes silence for the agents and the

insurance adjusters and the hundreds of people who work for

these insurance companies.

If you think the thing that you are doing is correct, why

not go ahead and provide compensation for losses?At least have

the gumption to permit these people to have their day in court

against you.

Interjections by some Hon. Members.

MR. GARDOM: "Not this bill," my foot! it carries out

the other bill and you know it. What you've done to this

industry is exactly the same thing that Castro did. He denied

the right to the court.

SOME HON. MEMBERS: Oh, oh.

MR. GARDOM: That's true. All right, let these people have

their day in court. Are you in favour of that? If you are in

favour of seeing that the people who have been sent down the

garden path by this legislation can have an opportunity for

legal redress, that's one thing. But just to go ahead and

emasculate this industry and not give them an opportunity to

have that is another.

And furthermore, why not give them the opportunity to

compete? How does the Minister of Highways think that he knows

all of the answers for this particular industry and it's his

heaven-given decision to go ahead and prevent any of the people

who wish at least to say to the general public, "We can do a

better job than the government and we want to be able to do

it"? They'll be paying their taxes and they'll be employing

people and they just want to have an opportunity to be engaged

in a lawful avocation in a democratic society. And you say

no.

It's a pretty darn stinking thing, in my view, that you can't at least let

these people have an opportunity to have their day in court or go ahead and

have the conscience to bring in effective legislation so they can receive compensation

for loss.

[ Page

2519 ]

MR. SPEAKER: The Hon. Member for North Peace River.

MR. SMITH: Thank you, Mr. Speaker. Dealing with the

principle of Bill No. 34, Insurance Corporation of British

Columbia Act , it is fairly obvious that for the government

to move into the field of car insurance they not only had to

have

an Act to cover the specific field of car insurance but

they needed a vehicle that would be all-encompassing to provide

for the base company or corporation, one of whose powers will

be to enter into the car insurance field.

Since we debated the principle of auto insurance in Bill No.

35 without having had the opportunity to debate the principle

of this bill first, when it should have been debated first, we

will deal with it this evening.

The objects and principles of this bill give the government

of this province the power to enter into every and all types of

insurance business. It's a type of bill that if exercised to

its fullest will not only wipe out the auto insurance industry

in the Province of British Columbia, it will wipe out all the

general insurance industry as well.

It could even go so far as wiping out all of the life

insurance companies in the Province of British Columbia,

although that would be a pretty big task to take on all at

once.

But let's just take a look at the powers that are outlined

in the bill. In its function the corporation has the power and

capacity to:

"(

a) subject to the approval of the Lieutenant Governor in

Council, to engage in and carry on, both within and without the

Province, the business of insurance and reinsurance in all its

classes;"

"The business of insurance and reinsurance in all its

classes."

That means that you can move into the general insurance

field, marine insurance, fire, casualty, the auto field which

the other bill covers, and the life insurance field.

You specify auto insurance as clause (

b) of

section 5 of the

bill so there's no doubt in the minds of the people who read

this bill exactly what you intend to do in that respect.

It also gives you the power to enter into the business

of,

"repairing any property insurance; and salvaging and

disposing of by public or private sale any property insured and

acquired under a contract by which the corporation may be

liable as an insurer."

MR. SPEAKER: Hon. Member. I would ask the Member not to

refer to specific sections of the bill — that comes under

the committee. But it is permitted to deal with the broad range

of the subject in general as long as you don't read out

sections of the Act.

MR. SMITH: O.K. I won't quote verbatim from the Act. But it

is difficult to deal with this type of a bill in principle

without referring to the intent of the bill and the intent is

spelled out in fairly specific terms. But I'll refer to them in

general terms.

MR. SPEAKER: If you steer away from mention of Sections I

think you might quell the savage breast.

MR. SMITH: We'll debate in principle the idea of whether the

government of the Province of British Columbia should enter

into all the insurance fields that you are permitted to enter

into under this bill. I would hope that is permissible as the

principle of the bill that is before us.

It not only gives you the power to enter into all classes of

insurance but it also requires those people who are agencies or

authorities of the government or over whom you have control, or

whom you make loans to, or whose bonds you guarantee, or who

are in any way connected with the Province of British Columbia

and doing business with the government of the Province of

British Columbia, to purchase their insurance from the

government-operated monopoly.

It was bad enough, Mr. Speaker, for the government to set up

the auto insurance business on a monopoly basis without

allowing competition, without really taking into consideration

the effect that such a move would have on all the individual

insurance agencies in the Province of British Columbia

operating in the auto field and in the general field. But even

that percentage of their business which is now represented by

the general field is being infringed upon by the principles of

this bill.

Most general agents that I have talked to tell me that from

50 to 70 per cent of their entire volume of business was

written in the auto field. Some of those agents will be

retained, I presume, as agents to act on behalf of the

government, although the rates of commissions have not been

spelled out. So they will have an opportunity, at least for a

while, to retain part of that business.

But with this vehicle, any day you choose and any time you

choose, you can move into the other areas of the insurance

fields which they have occupied for years and completely wipe

them out, not only out of the auto field but out of the general

and the casualty field as well.

You also provide in this bill a requirement for those

corporations or institutions doing business with the government

to purchase their insurance from that new corporation. While

the government has not really said in definitive terms just how

far they move into this general insurance field, when that bill

is passed and becomes law, you have all the power you need to

move in any direction that you wish. Not only that, you have

the power to force anyone who does business with the province

to do business with your

[ Page 2520 ]

insurance corporation.

If there was ever any doubt in the minds of the people of

British Columbia as to the ultimate aims of the NDP, they

should no longer have any doubts. It's certainly spelled out in

this bill. It's a type of legislation that for no good reason

and without any mandate you have decided to put into force in

this province. If it was your desire to go strictly into the

auto insurance field, you could have used the one bill. You

didn't need two bills. You didn't need the Insurance

Corporation of British Columbia Act . It could have all been

included under the one bill.

Since you feel that you had a mandate to go into the auto

insurance business when you were elected, because you

campaigned on that basis, you could have entered that field.

But the day you decided to bring this bill into the House, you

exceeded any mandate that you ever had in the Province of

British Columbia. No one should forget, Mr. Speaker, that this

government has no mandate to go into all the general, casualty,

marine, fire, theft and life insurance fields, from anybody in

the Province of British Columbia — not even from the

people who supported you, who must now have grave doubts as to

what your real motives are.

It's the proposed type of legislation that every small

businessman and every homeowner in British Columbia must view

with a heavy heart. They can see that while the provincial

government has provided certain benefits, they now have the

power to move into all the fields of insurance and not give the

individual a choice as to whether they wish to do business with

that corporation or not.

In reading this bill, Mr. Speaker, it would seem to me that

even those people who receive a homeowner grant in the Province

of British Columbia would be required, if the government goes

into the general insurance business, to buy their fire

insurance and the insurance on their houses from the Province

of British Columbia. So by the implementation of this

legislation, you force the people of British Columbia to do

business with your Crown corporation; in the same way that

you're going to try to force the mining industry to allow you

to become equity shareholders in their business; in the same

way that you're going to try to force anyone who does business

with the government to become unionized, whether they wish to

do so or not, even the small contractors.

Let no one think that the intent of this bill is to set up

auto insurance and auto insurance only in the Province of

British Columbia. The bill is designed to eliminate the private

insurance business and those companies that do business in the

Province of British Columbia. It gives you unlimited authority

to invest money as you see fit. It gives you the authority to

set up corporations. It gives you authority to wipe out a

segment of business that you have no quarrel with.

Mr. Speaker, it's the type of legislation that those of us

in the official opposition will not support. That doesn't come

as any surprise to the government, I'm sure.

Interjections by some Hon. Members.

MR. SPEAKER: Order, please.

MR. SMITH: But only those people who are not only socialists

but very left-wing socialists would ever support that type of

legislation and wipe out a segment of business in the province

that has done yeoman service to the people of British

Columbia.

We'll probably not find out exactly what the plans of the

government are under this particular Act until after it's

passed. Some day we'll wake up and see an announcement in the

paper that the Province of British Columbia has just

incorporated an insurance company called the ABC Company or

whatever to provide general insurance in the Province of

British Columbia.

Interjection by an Hon. Member.

MR. SMITH: That's a good name for it.

It is an unhappy day for British Columbia to see this type

of legislation come before us. I don't know of anything good

that I can say about the bill because of the ultimate intent of

this type of legislation. We have no intention of supporting

it, Mr. Speaker. We know that the government, with their

majority, will ram it through the House. We know that within a

specified length of time the Act which allows this corporation

to be set up in the Province of British Columbia will be used

to take over the private insurance industry in this province,

not only the auto insurance industry.

That's the intent. That's the purpose of the bill. We do not

support it, Mr. Speaker.

MR. SPEAKER: The Hon. Member for Oak Bay.

MR. WALLACE: Mr. Speaker, I'm sure it will come as no

surprise to the House to know that we also oppose this

bill.

Interjections by some Hon. Members.

MR. WALLACE: Oh, you got me right there. I must admit, Mr.

Speaker, that at this time of night it gets tougher and tougher

to get really excited. (Laughter).

Mr. Speaker, we oppose this bill for several basic reasons.

We don't believe that government has a place in the private

sector, particularly if it is not on a basis of fair

competition. If we have this government insurance bureau having

the advantage right off the bat of not paying income tax, then

I think you can

[ Page 2521 ]

hardly say that it's competing with the private

sector, who do pay income tax.

Interjection by an Hon. Member,

MR. WALLACE: Well, I don't accept that, Mr. Minister. I'm not suggesting

that the private companies are blameless either.

Let's put it this way, very clearly: this party doesn't feel

that the way to solve the shortcomings of the insurance

business is for government to get in the business. We feel that

there can be better ways. We just don't feel that government

does a good job of operating business. It tends to be

bureaucratic and impersonal and heavy-handed. We still

believe …

Interjection by an Hon. Member. (Laughter).

MR. WALLACE: Mr. Speaker, I obviously have my second string

out tonight, with respect to the Hon. Mayor from Saanich. I

really appreciate a little bit of support. Where was I?

MR. SPEAKER: You were clutching your wallet. (Laughter).

MR. WALLACE: No, it's on this side.

Among other things, we notice that this bill includes powers

of expropriation. The Minister shakes his head and looks all

upset but it's right there in the bill. There again, we see the

government seeking more and more power. This kind of bill is

indicative of the general trend we see in so much of the

legislation.

As I've said many times, we're stating our point of view,

the government's producing its policy and we leave the people

of British Columbia to make the choice. But I think the people

should always be clear as to what the two sides of the House

stand for. This government — at least I give it credit

that it makes its position very plain. It's sincere in its

beliefs. With respect, we're quite sincere in our beliefs.

We just believe that government doesn't have a suitable role

in competing with the private sector. We don't feel that that

is the role of government. We feel that the role of government

is to supervise and to discipline abuse in the private sector

by regulation or otherwise. But for the government to enter

into competition with the private sector because it believes

that there have been shortcomings in the private sector, we

feel is not the way to solve some of the problems in the

insurance business.

I've already stated that it's unfair because of the taxation

situation. We are also unhappy because this bill can compel

anyone or anybody or business doing business with the

government to accept the government insurance. I think it

should be made very plain, as the former speaker mentioned,

that there is no doubt whatever about the wide range of

possibilities under this bill.

In other words, the government is saying that this bureau

can indeed enter into any or all fields of insurance, and the

same kind of authority which exists in the proposed automobile

insurance could in time creep into other fields of fire,

general and life insurance.

We also feel that this means that in many cases the consumer

may finish up having no choice but to deal with government. The

kind of monopoly we have in the automobile insurance is no more

acceptable to us in general fields than in automobile.

The final point that we would like to make is that in many

of the areas where the government might well intervene, we're

not aware of any real need. We will not accept that this is the

one and only solution to deal with the behaviour of those

private companies which the government says have been rip-offs

and so on. We strongly believe that the function of government

is not to compete but to supervise. If there is unfairness to

the consumer, we feel that there are many ways in which the

government can function. But we do not believe that in mining,

or timber, or insurance, or in any other function in society,

the answer is for government to get into the business and

compete.

I've already said this afternoon that there's something

unique about dealing with government, whether you're just a

little man going to the government office to do business, or

whether you're a company trying to conduct a viable enterprise

and deal with government authority at some level. Dealing with

government is dealing with a very unique body that has

unlimited power. We don't feel that that unlimited power is

suitable to be introduced into the private business sector of

this province.

Mr. Williams moves adjournment of the debate.

Motion approved.

Hon. Mr. Barrett moves adjournment of the House.

Motion approved.

The House adjourned at 11:00 p.m.

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