1998/99 Legislative Session: 3rd Session, 36th 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)

THURSDAY, MAY 20, 1999

Afternoon

Volume 15, Number 9

[ Page 12669 ]

The House met at 2:07 p.m.

Prayers.

Hon. J. Pullinger: I have the pleasure today to introduce two special people.

John Katsiris, who is visiting us from Australia, is in the gallery today. He's a friend

of my son and his partner, and they met in Australia when my son was there on an exchange

co-op experience with the University of Victoria. With him is Trina Somers, who is my

son's partner. I'm delighted to welcome them both, and I ask the House to do the same.

E. Walsh: I am pleased to introduce Dave Byng to the House. Dave is from

Cranbrook, and he is the district highways manager for the East Kootenay district. Dave

works very hard for all those residents who travel through the Kootenays, to ensure that

they have safe and convenient travel. I would ask everybody to welcome Dave to the

Legislature.

D. Symons: Today we're privileged to have in the House a group of students from

James Thompson Elementary School in Richmond. There's a total of 75 people -- students and

adults, with their teachers -- and I believe that they're coming in two groups. I would

like the House to make them welcome -- and maybe doubly welcome, because half of them are

here now and half will be coming shortly.

Hon. L. Boone: In the gallery today is a gentleman who works for the information

technology management branch of the Ministry of Finance and Corporate Relations. Like many

government employees, he has worked for many years for government but has never actually

attended this chamber or attended question period. Today he is here, and I trust that we

will all be on good behaviour and show him how well behaved we are in this chamber. Would

the House please welcome Mr. Ron Burleson.

[1410]

J. Cashore: Saturday, May 22, marks a very special anniversary in the life of the

Minister of Small Business, Tourism and Culture, the member for Vancouver-Fraserview. That

day will be the twentieth anniversary of his first being elected to public office -- in

1979, when he was elected as Member of Parliament for Vancouver-Kingsway. He was

re-elected in 1980 and 1984; and then in 1988, his riding having been eliminated, he was

elected as MP for Port Moody-Coquitlam, where he was my colleague. It was great working

with him.

In 1993 he was subjected to the dastardly vagaries of political life, when he lost his

seat and he was forced by defeat into the ignominy of lawyer's work. But there is

redemption . . .

The Speaker: Member, this is going on a bit. Is there . . . ?

J. Cashore: . . . for in 1966 he was elected to sit in this august

assembly. He told me that he plans to be here for many more years, where he loves being

the minister of photo ops . . . I mean, the Minister of Small Business, Tourism

and Culture. He's not wearing his kilt today, so there won't be any kilt jokes; we won't

go there. Please give him resounding congratulations on this accomplishment.

The Speaker: Does anyone else want equal time? Seeing no further introductions .

. . .

Introduction of Bills

WILDLIFE AMENDMENT ACT, 1999

Hon. C. McGregor presented a message from His Honour the Lieutenant-Governor: a bill

intituled Wildlife Amendment Act, 1999.

Hon. C. McGregor: I move the bill be introduced and read a first time now.

Motion approved.

Hon. C. McGregor: Bill 63, Wildlife Amendment Act, introduces a variety of

measures that will assist in preserving the natural legacy of wildlife in British

Columbia. Beyond its intrinsic value, this legacy provides social, cultural and economic

benefits to British Columbians, including the opportunity to live in harmony with an

abundance and diversity of wildlife found in few places in the world. These amendments

will encourage the protection and appreciation of this legacy.

The bill focuses on two main areas. First, we are dramatically toughening penalty

preventions against those who take

part in poaching and other illegal activities related

to wildlife. For example, people trafficking in grizzly bear parts or engaged in grizzly

bear poaching will now face a maximum $100,000 fine for a first offence. Previously, these

individuals faced only a maximum fine of $25,000. Second, we are introducing new

provisions aimed at reducing conflicts between humans and dangerous wildlife. These

provisions respond to both public and local government demands to ensure early actions are

taken to limit bear attractants and the conflicts they create. Other amendments contained

in this bill are aimed at increasing the compliance, enforceability and cost-effectiveness

of our conservation management programs.

The people of British Columbia place a high value on the diversity and health of their

environment. This bill responds to those values and clearly reflects this government's

commitment to safeguard our wildlife resources.

Hon. Speaker, I move that the bill be placed on orders of the day for second reading at

the next sitting of the House after today.

Motion approved.

Bill 63 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.

[1415]

SECURITIES AMENDMENT ACT, 1999

Hon. J. MacPhail presented a message from His Honour the Lieutenant-Governor: a bill

intituled Securities Amendment Act, 1999.

[ Page 12670 ]

Hon. J. MacPhail: I move the bill be read a first time now.

Motion approved.

Hon. J. MacPhail: I'm pleased to introduce the Securities Amendment Act, 1999. The

purpose of this bill is to increase investor protection and to make sure that streamlining

amendments will provide uniform regulation with other jurisdictions. This act is being

amended to protect investors by providing the Securities Commission with additional tools

to use when the Securities Act is contravened. The Securities Act is amended to expand the

existing prohibitions on fraud and market manipulation, to expand the offence provisions

so that any material false or misleading statement or omission is a contravention and an

offence under the act, and also to permit the B.C. Securities Commission to apply for

certain court orders that would allow an aggrieved investor to recoup losses suffered as a

result of others' non-compliance with the act. The amendments also clarify the

jurisdiction of the commission to decide questions of law and to sanction an individual

who authorizes, permits or acquiesces in a company's or other entity's contravention of

the Securities Act.

The Securities Act is also being amended as part of our commitment to reduce red tape.

A number of amendments are being introduced to harmonize provisions in the Securities Act.

These amendments represent a significant improvement in investor protection and also a

streamlining of the Securities Act. They'll contribute to a very effective and efficient

regulation of the Securities Act.

I move that the bill be placed on orders of the day for second reading at the next

sitting after today.

Motion approved.

Bill 64 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.

Oral Questions

ACCURACY OF FORESTS MINISTRY SUBMISSION TO FEDERAL GOVERNMENT

M. de Jong: Madam Speaker, it's another day in Victoria, and that can only mean

that we have another leaked Forests ministry document. This one is dated March 30, 1999.

It's part of the submission that the government made when it sought a federal bailout of

its failed forestry policies. Interestingly enough, each one of the pages is labelled

"confidential -- do not distribute." The question's a simple one for the

minister: what is in this document that the minister didn't want British Columbians to

know? What's in this document that he doesn't trust with British Columbians?

Hon. D. Zirnhelt: The document is simply a document we used for the basis of

negotiating with the federal government.

The Speaker: First supplementary, member for Matsqui.

Interjections.

The Speaker: Order, please.

M. de Jong: I have a feeling, Madam Speaker, that this is going to be one of

those rare occasions when the information we get in question period is actually going to

be helpful. I know that the minister won't disappoint me in that respect.

So again, not a complicated question . . . . I keep hearing about this

resurrection in the forest industry, and I can tell you and members of the House that that

is not reflected in this document that the government was relying upon last month. So the

question to the minister is: what parts of this document are no longer accurate? What

parts of this document that the minister was relying upon last month no longer reflect the

state of B.C.'s forestry economy?

Hon. D. Zirnhelt: Yesterday the opposition released a document that was dated

November, which said: "In six months, we may have job losses if something doesn't

change." Six months later we're reporting out that things have changed and that the

number of job losses has been drastically reduced. The forest industry is in a slight

rebound, and we're a little optimistic on this side, unlike the other side that continues

to want to pour doom and gloom on those communities that are dependent on primary

resources for their economic base.

[1420]

The Speaker: Second supplementary, member for Matsqui.

M. de Jong: We'll try to keep it simple for the minister: his document, last

month. All I want to know from the minister . . . . Let's particularize it a

little more: does he stand by the job loss figures that his government and he were relying

upon one month ago in making submissions to the federal government?

Hon. D. Zirnhelt: Last week -- already -- I said that things had turned around

since that document was produced. When we submitted documentation . . . .

Interjections.

The Speaker: Members, members. I'm having trouble hearing the minister.

Minister, finish your . . . .

Hon. D. Zirnhelt: It's very clear that when we submitted the documentation to

the federal government, we expected, based on projections from the industry itself --

PricewaterhouseCoopers, back in the November era . . . .

Interjections.

Hon. D. Zirnhelt: Figures that we used through the new year . . . .

The opposition points to the date on the document. The important question is . . . .

Interjections.

FRBC RECORDS AS REVEALED BY FORESTS MINISTRY SUBMISSION

G. Abbott: I guess this is probably the first government in history that's dated a

report after they apparently negotiated it -- a most interesting twist.

[ Page 12671 ]

Over the past five years Forest Renewal B.C. has spent nearly $2 billion. Yet this

report -- this document -- says that another billion dollars is needed to implement those

initiatives that were supposed to be taken care of by Forest Renewal B.C. To the Minister

of Forests: is this document not a full, candid admission of the dismal failure of Forest

Renewal B.C.?

Hon. D. Zirnhelt: Not at all. I don't think anyone in their right mind would

have predicted only a five-year transition in the forest industry in British Columbia. The

opposition might think . . . .

Interjections.

The Speaker: Order, please.

Hon. D. Zirnhelt: It was a full understanding that Forest Renewal or programs

like that would be necessary for many years in British Columbia.

I'd like to point out a few of the highlights from Forest Renewal's first five years.

They spent $1.7 billion fixing watersheds, retraining workers and replanting forests. All

of those things have helped to stabilize those communities that so many British Columbians

are dependent on.

The Speaker: First supplementary, the member for Shuswap.

G. Abbott: The NDP government and Forest Renewal B.C. have succeeded in one

transition. They've taken the forest industry in British Columbia from being one of the

low-cost producers in the world to being the highest-cost producer in the world. What an

achievement!

When Forest Renewal B.C. was first announced by this government in 1994, the government

said it would "ensure healthy, productive second-growth forests." And yet, this

last month, as this NDP government spoke to the federal government, they told them that

after spending $2 billion, the level of funding was "insufficient to enable the

transition to high-quality second-growth forests." Will the Minister of Forests not

admit that this document is a failure, their whole forest policy is a failure and FRBC is

a failure?

Hon. D. Zirnhelt: On the contrary, this side of the House puts strong value on

environmental protection. That side of the House wouldn't support Forest Renewal . .

. .

Interjections.

The Speaker: Come to order, members.

Hon. D. Zirnhelt: They wouldn't support the 150 watersheds that have been

restored by this side of the House. That side of the House would not support any of the

surveys for wildlife and forest inventories by Forest Renewal that have been supported on

this side of the House. It's this side that supports policies for the new forest economy.

It's that side that wants to turn back the clock, rip up the Forest Practices Code, rip up

the environmental standards that are there to protect the forests of British Columbia for

British Columbians into the future.

B.C. SHARE OF FEDERAL HIGHWAYS MONEY

J. Doyle: Most of those people over there . . . . The only trees they

ever see are the ones at Stanley Park.

[1425]

Interjections.

The Speaker: Order, members.

J. Doyle: I'd like to ask the Minister of Transportation and Highways a

question. Despite 25 percent of Canada's national highway system being in British

Columbia, the fact that . . .

Interjections.

The Speaker: Members . . . .

J. Doyle: . . . $700 million per year goes to Ottawa in gas tax,

the fact that $1 million per year comes back to British Columbia, the fact that the

opposition leader said in February 1995 that the cuts from Ottawa weren't big enough and

also the fact that . . .

Interjections.

The Speaker: Order, members. It's hard to hear the question.

J. Doyle: . . . some of the worst highways in British Columbia, on

the Trans-Canada highway system, are in the constituency that I represent, in the

Revelstoke and Golden area . . . . I'd like to ask the Minister of Highways

what discussions he's got going on with the federal government to try to get a fair share

for British Columbia.

Interjections.

The Speaker: Come to order, members.

Hon. H. Lali: I could take all day, if that's what the members opposite want,

but it's eating up their clock time.

Interjections.

The Speaker: Come to order, members.

Hon. H. Lali: I want to thank the hon. member for Columbia River-Revelstoke for

that very important question. As this House is quite aware, last year when I went to

Edmonton with the council of transport ministers from all across Canada, I presented a

paper on behalf of all of the provincial transport ministers, calling on the federal

government to institute a national transportation investment strategy. The hon. member is

correct that Ottawa takes $700 million out of British Columbia in fuel taxes but only

gives us back about $1 million, as it was last year. We're working very hard to correct

that. We made our message clear to Mr. Collenette to take it to the federal Finance

minister, and we're calling for a ten-year, $16 billion program, so . . .

The Speaker: Minister . . . .

[ Page 12672 ]

Hon. H. Lali: . . . we can work projects such as the one in the hon.

member's riding, Kicking Horse Pass, and also the Three Valley Gap.

The Speaker: Thank you, minister.

CONDITION OF FOREST SERVICE ROADS

G. Plant: I have a question for the Minister of Forests about Forest Service roads

and the March 30 confidential document. According to this confidential document, his

ministry has identified 1,100 bridges and culverts that need to be replaced over the next

five-year period. The report is clear. If this reconstruction work isn't done, there will

be "little option but to close the structures" as they become unsafe and close

the roads.

My question to the minister is: when was he planning to tell British Columbians that

their economically vital forest roads and bridges are becoming unsafe and will have to be

closed?

Hon. D. Zirnhelt: We're in the process of assessing which roads should be kept

open. As you know, we create thousands and thousands of kilometres of new roads every

year. Some of them are no longer needed after forestry harvesting has been finished, but

we go through an assessment as to the economic necessity.

It is true that all our budgets are under scrutiny, are under pressure, in order to

support education and health care in this province. We are asking that we do a careful

assessment, road by road. When that assessment is complete, should there be a necessity to

close any Forest Service road, then we would be happy to inform the people who would be

affected by it. But until a decision is taken to close a road, there won't be anyone

informed.

The Speaker: First supplementary, the member for Richmond-Steveston.

G. Plant: Well, on my reading of the report, the ministry's already done .

. .

Interjections.

The Speaker: Members, come to order.

G. Plant: . . . the assessment. They've identified 1,100 bridges and

culverts. It sounds like they've got a list; it sounds like the minister should table it.

But the point is this: there are 43,000 kilometres of forest roads, and the document

calls these major public assets. The Ministry of Forests says that these assets are at

risk. So will the Minister of Forests admit, after eight years of failing to protect these

assets, that it's his government's policies that have put this economically vital

infrastructure at risk?

[1430]

Interjections.

The Speaker: Come to order, members.

Hon. D. Miller: Only in British Columbia, hon. Speaker . . .

Interjections.

The Speaker: Come to order, members.

Hon. D. Miller: . . . has the official opposition taken a position

of undermining the government of British Columbia when we are trying . . . .

Interjections.

The Speaker: Members, come to order. We heard the question; now we hear the

answer.

Hon. D. Miller: When we try to lever federal assistance, only the opposition

here in British Columbia would undercut British Columbia citizens. In Saskatchewan, when

there was a failure in wheat and hogs, the opposition in Saskatchewan didn't attack the

government. They joined with the government in Saskatchewan, and they got federal money.

Interjections.

The Speaker: Minister, finish up.

Hon. D. Miller: In Atlantic Canada, when there was a failure in the fisheries

and they rightly deserved some federal assistance, the opposition in Atlantic Canada

didn't attack the provincial governments. They joined with them, and they received

assistance.

The Speaker: Finish up, minister.

Hon. D. Miller: Here in British Columbia, when we try to get assistance for

forestry and fishing, the opposition attacks us. They agree with the federal government. I

say shame! Stand up for British Columbia.

Interjections.

The Speaker: Order, members. Come to order.

BREW PUB BEER MARKETING REGULATIONS

I. Chong: Let's talk about what this government is doing for B.C . . .

Interjections.

The Speaker: Order, members.

I. Chong: . . . and in particular for Victoria. Spinnakers, a

Victoria brew pub, has been trying for six years to sell its beer in provincial liquor

stores and to other restaurants. But this NDP government won't let them, even though

Spinnakers has won its case at the Liquor Appeal Board.

Will the minister responsible for the liquor distribution branch tell us . . .

Interjections.

The Speaker: Order, members.

I. Chong: . . . why he won't change the regulation now and allow

brew pubs to sell their beer in B.C. liquor stores?

[ Page 12673 ]

Interjections.

The Speaker: Order, members. Come to order. The minister is not going to reply

until the House comes to order.

Interjections.

The Speaker: Members, members. Come to order.

Hon. I. Waddell: The matter is essentially before the court, and they'll look at

it. The problem is this, and I can tell . . . .

Interjections.

The Speaker: Members, members. Come to order.

Hon. I. Waddell: The problem is that under

section 18 of the Liquor Control and

Licensing Act of the province, a manufacturer can't be a retailer. The reason is that

years ago the government separated, on the advice of a royal commission . . . .

Pub ownership was separated from breweries. The result is that you can walk into a pub in

British Columbia and find a big diversity of beers. That was changed slightly; they're not

tied. The pub owners are not tied to the breweries. If we tied them to the breweries,

Labatt's and Molson's would own all the pubs in British Columbia, and you wouldn't get

much chance of a diversity of beers.

Interjections.

The Speaker: Order, members.

Hon. I. Waddell: In 1980 . . . .

The Speaker: Minister, finish up, please. We're over time as it is.

Hon. I. Waddell: All right. There was an exception made for pubs like Spinnakers

so that they could sell, in their own restaurants or their own bars, the brew that they

made. The industry generally is not in favour of the change on this matter, but I'm

prepared to listen to what they say and to look at it. We want to change the liquor laws;

we want to make it good for consumers. We want to eliminate red tape, and this is what we

intend to do.

The Speaker: The bell terminates question period.

D. Symons: I ask leave to make a response to the Minister of Transportation and

Highways' ministerial statement.

The Speaker: No, leave's not . . . . It's not an appropriate

question.

Tabling Documents

Hon. M. Sihota: I have the honour to present Public Service Employee Relations

Commission annual reports for the years '96-97 and '97-98.

[1435]

Hon. J. Kwan: I have the honour to present the Property Assessment Appeal Board

annual report for 1998.

Hon. I. Waddell: I have the honour to table a report by the working group on

film and television -- Michael Francis, Chris Haddock and Anne Wheeler -- that was

presented to me yesterday in response to the federal report called "The Road to

Success: Report of the Feature Film Advisory Committee."

Orders of the Day

Hon. J. MacPhail: In Committee A, I call Committee of Supply. For the information

of the members, we'll be debating the estimates of the Ministry of Municipal Affairs. In

this chamber, I call Committee of Supply. For the information of the members, we'll be

debating the estimates of the Ministry of Labour.

The House in Committee of Supply B; H. Giesbrecht in the chair.

ESTIMATES: MINISTRY OF LABOUR AND MINISTRY RESPONSIBLE FOR

THE INSURANCE CORPORATION OF BRITISH COLUMBIA

On vote 39: ministry operations, $24,045,000.

Hon. D. Lovick: Mr. Chairman, I discussed with my colleagues in the opposition

the other day, when we heard that my estimates would be up sooner than I had thought, that

I would begin by making a brief statement about the labour part of the ministry and then

we would go directly into the ICBC portion. I understand that my colleagues opposite want

to begin with ICBC. So just for the benefit of you, Mr. Chairman, and any others who may

be paying attention to what happens here, let me start by saying I'm pleased to be

introducing the 1999-2000 budget estimates for the Ministry of Labour.

Today I'm going I'm going to speak briefly about the responsibilities of this ministry

and also about the structure through which its mandate is fulfilled. I also hope to say

something about the accomplishments of the past year, as well as where the ministry

intends to go in the coming year.

Let me start, then, with ministry budget and structure. The Ministry of Labour operates

with a proposed 1999-2000 budget of $24.045 million which includes recoveries of some

$13.6 million and an allocation of 447 full-time-equivalent positions. Of these, 140 are

attached to the employment standards branch. As Minister of Labour, I also report to the

Legislature on the activities of the Workers Compensation Board and the Labour Relations

Board, both of which operate in an arm's-length relationship from me, as agencies at arm's

length from government.

[1440]

In addition, I share responsibility with my colleague the Minister of Advanced

Education, Training and Technology for the Industry Training and Apprenticeship Commission

-- albeit he has all the money. The Labour ministry, moreover, serves the public through

offices in 18 different communities around the province, and that includes some 17

employment standards branch offices, three employers adviser offices, five workers adviser

offices and the pension standards branch and collective agreement arbitration bureau,

located in Vancouver.

Let me turn now to something about the ministry mandate and a brief overview of

operations. The Labour minis-

[ Page 12674 ]

try's mandate covers a rather broad spectrum of responsibilities that relate to the

workplace, including the following: first, to promote harmonious relationships between

employers and workers; second, to ensure that workers enjoy basic standards in terms of

working conditions and compensation as well as healthy and safe working conditions; next,

to ensure that employment pension plans meet basic standards in providing retirement

income for workers and for retired persons; moreover, to promote workplace-based

apprenticeship training to ensure that British Columbians have the skills necessary for

jobs.

Coming under that mandate, then, is responsibility for a number of things -- namely,

employment standards, the skills development and fair wage program, labour relations,

apprenticeship, workplace safety, workers compensation and pension standards. What ties

all of these together is that they are part of the fundamental framework for relationships

between employers and employees. It is the quality of that relationship that will

ultimately determine how successful we as a ministry are.

This is a ministry that deals with employers and employees on an everyday basis, and we

do so on many different levels concerning many different things. For instance, the Labour

ministry is usually among the first to hear about changes in skill demands as new

occupations and new business opportunities emerge. We also see the impact on workplace

relations when different sectors come under economic stress. That may mean layoffs or it

may bring added pressures to the bargaining table, and that's when, of course, it becomes

my concern and comes to my attention.

Our constant need, of course, is to be competitive in a global economy. Needless to

say, I'm not surprising anybody when I say that that can put employers and employees on a

collision course. The much-vaunted idea that some embrace -- that somehow the old

adversarial system has gone, and this is the nineties, and trade unions are no longer

necessary, and we can all sit down and work things out -- alas, is belied and denied

constantly by the facts. The reality is that we are often on a collision course. The job,

of course, is to try and somehow decrease the severity of those collisions.

Similarly, those relationships can also create opportunities -- opportunities for

cooperative effort, with shared responsibility and shared decision-making. Bad workplace

relations generally result in the former, the collision course. Good workplace relations

are essential to the latter.

In short, my work as minister is about building economic success based on good

relations and on fair treatment for both workers and employers. That is why laws that

affect the workplace must fairly balance the needs of employers with the needs of

employees. For example, while the Pension Benefits Standards Act provides minimum

standards for every private pension plan in areas such as eligibility, investing and

portability, it also requires that there be a structure in place to deal with disputes,

because inevitably there will be disputes.

The Skills Development and Fair Wage Act establishes wage rates that are in the middle

range for construction employers, the construction industry. Now, I know that causes

concern for some employers. Certainly we've heard those concerns. But the same employers

have the option of taking on apprentices, giving young people and people in career

transitions the chance to learn new skills. Apprentice pay rates, accordingly, are

commensurate with experience. The company that commits itself to apprentice training is

rewarded through more competitive cost structures.

Mr. Chairman, this ministry has been very active in the past year in promoting

workplace cooperation and shared decision-making. We've done that with the high-technology

sector, with the film sector and in forestry, to name just three. What we've demonstrated,

I think, in each of those instances is that economic growth can be fostered in an

environment based on cooperation and on mutual gains. We don't have to sacrifice workplace

protection in order to have job growth.

[1445]

What we continually endeavour to do, however, is to keep the playing field level.

Therefore we set and enforce minimum workplace standards in areas where there is a

consensus that such standards are in fact needed. Beyond that, it is up to employers and

employees to negotiate conditions appropriate to their particular enterprise and their

particular industry. In fact, under recent changes to the Labour Relations Code,

construction workers and their employees are able to negotiate agreements right down to

the individual project level.

Let me briefly turn now to the labour relations climate. Before I move on to future

objectives, I want to talk about the current circumstance. I think it is important to say

something about labour relations in general. First of all, let's have no illusions that

the labour relations climate is inextricably entwined with the economic climate. Where

this ministry plays a vital role is in ensuring that labour relations issues get resolved.

In the vast majority of contract negotiations, differences between employers and employees

are resolved at the bargaining table.

What we've seen since 1992 is increasing stability in labour relations in British

Columbia. Indeed, in the period since 1992 we've had an average of 44 work stoppages per

year. From 1983 to 1991 the average was 70. Comparing the number of workers involved in

work stoppages and the number of days lost during those two periods, we see a similar

trend. In the years 1983 to 1991 an average of 50,851 workers were involved in work

stoppages, with an annual average of 674,843 days lost. Between 1992 and 1998 the annual

average was 23,536 workers involved in work stoppages, with 312,938 days lost. Throughout

that period, from 1992 forward, the rate of unionization has remained constant -- around

35 percent of the workforce. What that tells us, surely, about the labour relations

climate is that it is much improved from what it was prior to the current code coming into

effect.

This is where I must make a point that may be perceived to be slightly partisan,

because when the code was introduced in 1992, it is true that there were people on the

other side of this chamber lighting their hair on fire, figuratively speaking, and saying

the sky was falling, the province would be crippled with strikes and lockouts and we'd

lose day after day and week after week, and the economy would be in disaster because of

bad labour relations. The evidence points to the exact opposite conclusion. Indeed, a

modern, balanced, fair Labour Code of the sort we introduced in 1992 has had precisely the

opposite effect; it has improved that climate significantly. That doesn't, of course, mean

that everything is okay and that we can rest on our laurels. Rather, we need to look

forward, and we need to recognize we can indeed do better.

In the coming year we've established building closer relationships with stakeholders,

both business and labour, as a key priority. Just as the success of any enterprise hinges

on building cooperative relationships, our ability to deliver ser-

[ Page 12675 ]

vices and to ensure that our legislation stays current flows from positive and

productive stakeholder relations. What often hampers our relations with stakeholders is a

lack of adequate and credible data about labour-management issues that are specific to

British Columbia. Accordingly, I have directed ministry staff to move ahead with the

development of a framework for an economic cooperation institute. That was recommended,

you will recall, Mr. Chairman, by the 1998

section 3 committee -- Ready, Lanyon, Gropper,

Matkin -- which undertook a review of labour relations in B.C.

[1450]

Our objective here is to facilitate the creation of an independent agency that will

provide reliable, impartial and consistent information about economic and

labour-management issues. Let me just digress for a moment about that point. Labour

relations is largely, alas, about crisis management; it's about dealing with problems that

arise. Most of us, I think, when we get involved in that field and look at the

complexities and the difficulties, say: "Is this the best way to do it always? Or

should we be looking at other jurisdictions? Maybe somebody else has found a better

way." My experience has been that nobody has yet found a better way than to have free

and fair collective bargaining -- but, as we know, people get bruised in that process.

Let's look, then, with the most creative kind of mindset we can bring to the table, at

other ways of perhaps solving some of those problems. Accordingly, then, when I see a

recommendation such as was made in the Ready-Lanyon-Gropper-Matkin report -- I think those

were all the names -- that talks about a forward-looking approach to labour relations, I

get excited. Maybe it's because I'm an academic by background, but that kind of approach

strikes me as absolutely necessary and may indeed have huge, huge rewards for us all. It's

certainly worth trying, in my opinion. Therefore we are doing so.

I'm also, in the coming year, planning on building very much on the work that was done

by the Royal Commission on Workers Compensation, which, as we recall, was to both improve

the workings of the compensation system and improve British Columbia's workplace safety

record. For the latter, we have already taken significant steps. We made improvements to

workplace safety based on the royal commission's interim report, and I'm looking forward,

of course, to bringing to this House a response to the final report as well.

I also believe, speaking on the theme of looking forward, that there is room within

branches of the ministry itself to do a better job in delivering services to the public.

Just as we have seen lower injury rates resulting from the Workers Compensation Board

having made accident prevention a priority, I believe that other ministry programs must

ultimately focus greater efforts on client education to head off in order to head off

problems before they arise -- and that can be done, I think, in a number of ways.

One very recent exercise that can perhaps serve as a model for the future was the

special forum on the changing workplace rules in the high technology sector. This forum

gave ministry staff the opportunity to talk face to face with some 200 high-tech industry

leaders, professionals and ordinary workers. What's most interesting and encouraging to me

in all of this is that all of that was driven, not by government, but by people in the

industry itself -- people who want to build long-term partnerships with government. They

see government as their ally in creating that kind of climate I referred to earlier.

As in all ministries of government, Labour is also faced, of course, with the need to

invest in its own state-of-the-art technology, but we have to provide people with the very

best tools if we expect to them to give everything they can. In these days of shrinking

budgets and cutbacks in ministry complements, we obviously have a double obligation to

provide them with the best tools, the best equipment we can, to carry out their work. With

that fiscal challenge also come some opportunities: the opportunity to provide, perhaps,

faster service and the opportunity to serve people in more ways.

The Ministry of Labour, then, is continuing to play an important role in the growth of

our province's economy and in improving the lives of British Columbians. The ministry is

committed to helping create a positive economic and social climate that will contribute to

the creation and protection of well-paying, family-supporting jobs. I think that's what

all of us in this chamber would agree ought to be the aim. Nobody wants a McJob culture in

this province. I don't think it's the case that any of us would accept that people, in

order to raise families, should have to work at three jobs. Good-paying, family-supporting

jobs is the goal all of us have, and we should do whatever we can to create those.

[1455]

By the same token, of course, we recognize that we need to do what we can for business

to give it the flexibility it needs to thrive and create those jobs while ensuring that

adequate minimum standards are in place for all workers. Over the past year, we've

continued to develop close and valuable partnerships with the business, labour and

education communities, as well as with other levels of government. We look forward to

these partnerships continuing in the future, and I certainly look forward to discussing

our plans and our accomplishments in detail with my colleagues on the other side of the

House. Indeed, I look forward to both their comments and their questions.

Having said that, I want to turn now to the ICBC part of my mandate, as minister

responsible for that large corporation -- the fifth- or sixth-largest insurance company in

North America, I believe. I'm looking to the side, because the ICBC staff have arrived,

and I haven't yet invited them to take seats beside me. Why don't I do that now and just

invite you to come over as I chat?

Let me start by making a couple of brief points. First of all, when we talk about ICBC,

we should recognize that it does have a history. It's 25 years old. This is the

celebration, the anniversary, of 25 years. The theme, if I had to pick one to describe

what I'd like to say about ICBC and what I think will become part of our discussion, is

that it's not just another insurance company. Albeit it is an insurance company and a very

good one, it's not just another.

The best way I can capture that to begin with is to quote just a little bit from the

annual report which I tabled in this chamber yesterday. I want to just read, if I might, a

few paragraphs about ICBC and what it does and what its mission is. "British

Columbians reap the rewards of ICBC's 25-year investment" is the headline for the

section I'm reading, and I mention that in case anybody watching this would like to get a

copy of that annual report. One can certainly do so by writing to the corporation or

indeed to me, and we'd be happy to make that available.

"Twenty-five years ago ICBC was created with a mission to bring equity, fairness

and affordability to auto insurance in B.C. and to ensure that investment dollars stayed

at home to help

[ Page 12676 ]

build B.C.'s economy. We have held up our end of the bargain" -- says the ICBC

report. "Fairness is built into the way ICBC sets auto insurance rates. For more than

two decades we have based premiums on factors that the policy holder can control --

avoiding being at fault in a crash, for example -- rather than age or gender.

"ICBC has also lived up to its promise of economic benefits to British Columbians.

Over the years, many billions of dollars have flowed through ICBC back into the provincial

economy. Last year alone, we paid out almost $2 billion in claims and other . . . amounts

paid to claimants, the rest went to B.C. businesses and professionals, such as auto repair

shops, glass shops, doctors, lawyers, towing companies and physiotherapists. Aside from

the 5,100 British Columbians we employ directly, Autoplan sales provide a living for over

900 independent insurance brokers in virtually every B.C. community.

"While we continue to fulfil our original mandate, ICBC's mission has grown into

something much more. Our merger last year with the former motor vehicle branch has

completed this evolution, giving us even greater accountability for road safety. Today

ICBC's mission is to help British Columbians take the risk out of road transportation -- a

goal whose achievement directly benefits all auto plan policy holders, as well as the

community at large.

[1500]

"In this sense, the resources that ICBC devotes to preventing crashes and reducing

auto crime represent investments on behalf of our stakeholders. Our efforts to combat

drinking-driving and speeding, to take unsafe vehicles off the road, to improve road and

vehicle design, to combat theft and fraud -- all of these provide a significant payback in

both financial and human terms. Every B.C. driver shares in the dividends."

That's the key point -- why I say ICBC is not just another insurance company.

[P. Calendino in the chair.]

Three years ago, Mr. Chairman, the Premier froze ICBC rates. This year the corporation

took an even further step. Based on better driving, fewer claims and an improved financial

picture at ICBC, a road safety dividend was introduced. A dividend worth 2 percent was

returned to ICBC customers this year, and that represents savings of some $47 million for

B.C. motorists. Translated into individuals, it's not a lot of money, but across the

province that 2 percent dividend was $47 million in the pockets of British Columbians.

The key point, though, was that that money went to those people who had got the message

about safe driving. What it was and what it is and what it should be is a reward to safe

drivers for their performance. Almost two million ICBC customers are benefiting from the

road safety dividend. I want to stress that, if I might, because whatever ICBC does in

terms of all its road safety activities -- wonderful and creative and energetic as they

may be -- all those efforts will work if, and only if, the public buys in and the public

says: "Yeah, you're right. We should also do our part to reduce the hazard on the

roads and highways of this province." And do you know what? They've done it very

well. Hats off to the public, because they have participated in a very big way, and

therefore we have had good success.

We've had good success for a number of reasons. A number of programs, as I referred to

earlier, have indeed been creative -- things, for example, like graduated licensing for

new drivers and crackdowns on fraud and auto thefts. These things are helping to reduce

the number of ICBC claims, and I think we will all applaud that. We do those, of course,

working with the police and with community groups who share with us the ambition to reduce

crashes and to stop auto crime.

All of this effort, as I said, is reflected in the corporation's bottom line. It's not

only good in human and people terms; it's also good in pure economic terms. We have moved

from a $135 million loss at ICBC in 1996 to a $120 million surplus in 1998. And all of

that, I would remind people, was accomplished when ICBC rates were frozen. In fact, under

ICBC our insurance rates are close to, and in many cases lower than, the rates that many

motorists pay in Ontario and in Alberta, for example.

Unlike the private sector, our public auto insurance system in this province ensures

that all licensed motorists get access to insurance coverage based on their driving

records, not on their age or sex or marital status. And that's the difference between us,

in a public corporation, and private sector insurance.

ICBC, as I alluded to earlier, is also a hugely important economic engine for this

province, by investing more than $300 million a year in the province through its real

estate and other investments. By being creative and working with other partners in the

community, like the Technical University in Surrey, ICBC is exploring some other

innovative ways to match our investment dollars with new opportunities to help create new

businesses. We're looking for win-win solutions that will ultimately mean good value for

our policyholders.

I want to just put this in context -- in perspective, if I might. You know, a number of

people have said -- indeed, I've even heard it said, I think, by members opposite:

"Well, why is ICBC investing in real estate?" The short answer, of course, is

because every insurance company in the world invests in real estate. You always keep a

part of your investment portfolio, which you have to have to protect yourself to pay off

claims, in that form. But the difference in B.C. is that we invest that money, or a

significant portion of it, in British Columbia. The money doesn't leak out of this

province. Rather, it stays here to do good things in this province, and that's an

important, important distinction, it seems to me.

[1505]

ICBC investments and investment capital also provide hundreds of jobs for British

Columbians in communities across the province. ICBC keeps these dollars in the province

and earns an excellent return on their dollars, largely because B.C. is a good place to

invest. Every dollar that we earn, of course, helps to reduce the costs of auto insurance

for B.C. drivers. ICBC's investments in community, road safety and auto crime prevention

programs are unmatched in the Canadian insurance industry. Nobody else can make the claims

that ICBC does in terms of preventing accidents. That's what we do, and we do it very well

indeed.

I think it's fair to say that ICBC is responding very well to the needs of its

policyholders. We can't, as I said earlier, though, do it alone. Every British Columbian

has a role to play in road safety, and that's why we continue to work to build

partnerships with the police, with local governments and with community groups to reduce

crashes and to reduce auto crime.

I take some pride in the fact that ICBC, despite its size and despite the fact that

many of us look at it and wonder how you would ever figure out exactly what goes on there .

. . . I put myself in that group certainly, and I think that my friend across the

way from Kamloops-North Thompson, who worked for the corporation in another life, would

probably also say the same -- about how big it is and how hard to get a hold of. But I

think we should all take some pride not only in that marvellous record of keeping its

rates competitive

[ Page 12677 ]

-- indeed, frozen -- not only in terms of providing that wonderful economic engine for

the province, not only in terms of its role in creating that new culture of safety and

even in doing its bit to decrease pollution -- that's ICBC's other activity . . . .

All of those things are commendable and admirable and eminently supportable.

As well, despite doing all those things above and beyond just providing insurance, I

take some pride in the fact that ICBC is also, according to all the evidence I've seen,

one of the most efficient insurance companies in North America. Indeed, I'm advised that

our administrative costs have remained low. Something like only four cents out of every

premium dollar is spent on ICBC administration, and that, I gather, is a record that's

competitive with any other corporation, public or private, anywhere else.

ICBC, then, is an efficient and customer-oriented operation -- by listening to

customers, by improving the way claims are handled, by attacking fraud and auto crime and

by supporting an aggressive crash prevention program. I think we can all take pride in the

fact that British Columbians want to work together to create the safest roads in the

world; that's our mission.

I'd like, if I may, to introduce the people here with me who are going to assist in

answering questions. On my extreme left is Thom Thompson, chief executive officer of the

corporation. To my right is Greg Basham. Greg, I'm sorry; I'll have to look at the note to

get your title: government and corporate relations executive.

On my immediate left is Anwar Chaudhry, who is the corporate comptroller. Behind me is

Donnie Wing, who is the manager for strategic planning and corporate relations.

Again, I welcome this opportunity to answer questions about the Insurance Corporation

of British Columbia. I look forward just to hearing the members' comments about it as

well. With that, I will close and look forward to comments.

K. Krueger: I thank the minister for his opening remarks, which were not concise

but were uplifting.

I appreciate also and want to thank the minister and the senior people in the many

departments of his ministry for their assistance in providing briefings to the official

opposition as we've asked for them. They've been very helpful. I think it will save us a

lot of time in these estimates, in that we covered ground which we won't have to cover

here, taking up the time of the officials in the Legislature or the time of the

Legislature itself.

[1510]

These briefings have given us once again a sense of the scope of this ministry and the

tremendous size of the responsibilities that rest with the minister. People have often in

the past drawn parallels with the responsibilities of the Attorney General. Indeed, there

is a very significant portion of the population of British Columbians who look to this

ministry to ensure that they receive fair treatment when they're hurt, both on the roads

now and in the workplace -- also for the parallel justice system that the Ministry of

Labour provides. It's a tremendous responsibility. To many British Columbians, this

ministry and the boards and commissions and departments that it manages are the court of

last resort for a lot of their problems. It's an awesome responsibility.

The minister talked about people's fears when Labour Code changes were made in the

early nineties and referred to members on this side of the House setting their hair on

fire. I wasn't here to see that. Regrettably, we're still on this side of the House, and I

haven't seen that in my time here.

An Hon. Member: Figuratively.

K. Krueger: Yes, figuratively, of course.

The province has suffered economically, and I don't think the minister would dispute

that, although he might dispute with us the reasons why we believe that has happened. But

there is -- and I think the minister would allow this -- a tremendous perception of bias

against job creators in this province. People simply aren't bringing their money here.

There has been really consistent input from the various business summits held, those

organized by the government and those organized by the business community themselves.

There has been a consensus that there are three main reasons for the economic

difficulties that British Columbia finds itself in. Those three factors are like pillars,

legs of a war machine that has been used to destroy this economy, in people's minds. Many

people are convinced of that.

One of those pillars is what are perceived to be labour laws that are out of balance,

and that's an area that I hope the minister and I will sincerely be able to work on

together over the coming years and in the course of these estimates. We don't intend to

waste any time going over simple facts that we could find and have been given through

briefing meetings. We want to talk about the concerns that British Columbians are raising,

and I will touch on a few of those shortly. But we want this to be a meaningful and

productive exchange both in the issues we're dealing with today and in those many other

areas that we have to cover over the coming days.

The other two legs of that war machine, in people's minds, have been overregulation and

overtaxation. Taxation may not seem to have too much to do with the Labour ministry,

although there are issues around Workers Compensation Board assessment rates and around

ICBC premiums -- which to many people are not that much different from forms of taxation.

Certainly the ministry has to do with a great deal of regulation, and that is something

I'm hoping we can work on together in these estimates and over the coming years.

The economy of British Columbia has been blasted by something. It's like the ruins of a

war. We've gone from the best-performing economy in Canada to the worst-performing economy

in Canada. Whether or not we agree on the reasons for that, we all have an obligation to

try and work to undo the damage and to restore prosperity and confidence in our economy.

We certainly face fiscal challenges, as the minister alluded to. There's always an onus on

government, even in good times, to ensure that there is careful and good stewardship of

public funds, because we're not dealing with any of our own money. We're dealing with

money that is extracted from the public -- however we want to view it, every government

does that -- in the form of taxation, fees, licences, premiums, assessments and so on.

There's a tremendous onus to make sure that we only spend the public's money wisely.

Some of the issues we'll be dealing with, of course, are ICBC, beginning today, and

Labour Relations Board issues, the Workers Compensation Board, the employment standards

branch and so on. Certainly the pension benefits standards branch is top-of-mind, because

we have legislation pending, awaiting second reading debate. So we have lots of things to

cover.

[ Page 12678 ]

[1515]

We've chosen to cover ICBC first, for a number of reasons. The government assigned ICBC

to the Ministry of Labour not long after I was appointed the critic for Labour in the

shadow cabinet. I wondered if that was coincidental or if that was mischief. Perhaps

that's flattering myself. But as the minister said, I did work for ICBC for a long time.

ICBC is 25 years old. I started with them 24 years ago -- so almost from the beginning,

with many observations along the way, working for ICBC for 20 years. I desired then, and I

desire now, to help ICBC be a high-performing company and to really serve British

Columbians well.

When I joke that it may have been government mischief assigning ICBC to this portfolio

after I was appointed critic, I'm referring, of course, to the concern that all members of

this House have that we never find ourselves in a conflict-of-interest situation, nor even

in one where we can be perceived to be in a conflict of interest. Certainly the Minister

of Advanced Education is well able to deal with that, being in a similar position to me.

So, for the record, I am a long-term ICBC employee on long-term leave without pay. That

leave began in 1996, shortly before the election. I have an obligation, of course, to

avoid conflicts of interest. That's carefully laid out in the applicable act. I've been to

the new conflict-of-interest commissioner, H.A.D. Oliver, as well as to Mr. Ted Hughes in

the past, and they've each given me letters that say the same thing, which essentially

boils down to . . . . I'm going to carefully avoid participating in any debate

here where the result could be enhancing of my private interest, should I go back to ICBC

one day -- or even a perception of a reasonably well-informed person that that is what

might occur.

So I'm going to ask the minister -- his government having put me in this situation --

for the courtesy of alerting me if he intends to deal with any matters that could be

perceived to potentially provide benefits to me from the corporation. Certainly my

colleagues are going to assist me in that regard as well.

Very shortly, I'll turn conduct of this debate over to the member for North

Vancouver-Seymour, who has graciously agreed to serve as my deputy for ICBC purposes. But

I will remain involved in the debate in those areas that affect me and my constituents as

a broad class of electors. I think that I have an obligation and an onus to do that,

because 20 years at ICBC were a real learning experience for me, and there are things that

I can contribute -- and I intend to. But out of an abundance of caution, my colleague will

conduct the debate, and I'll just get involved here and there.

[W. Hartley in the chair.]

Only yesterday, the ICBC annual report was tabled -- pretty late, from our point of

view. One of the things we'd like is an explanation of why it was so late. I appreciate

the minister's courtesy in that as soon as he got it, he sent me his own copy with, as he

refers to it, his chicken scratches on it. That was kind of him, but it was a very late

report. The corporation's fiscal year ends at the end of the calendar year, and this

Legislature is owed the courtesy of timely reports. My colleague will be dealing with that

in more depth.

When things like that happen, MLAs can't help but wonder if contempt for the

Legislature is being shown. In fact, the opposition has experienced the frustration of not

having some of its questions from past estimates debates answered by ICBC. I have some

ideas as to why that might be, but again it's considered a sign of disrespect. We

represent people who want answers to these questions. If the corporation's unwilling to

give those answers, it should say so, rather than simply ignoring the questions.

For example, the premium freeze is seen by many people of the interior and Vancouver

Island as not being a positive thing for their interests at all. Like the B.C. Hydro rate

freeze, which freezes hydro rates at artificially high levels, the premium freeze has not

been something that's been greeted with enthusiasm by people in regions whose premiums

were dropping before the freeze happened. For years many people had advocated that ICBC

shift to a rating structure that reflected the loss experience in geographic regions, and

ICBC had begun to do that prior to the premium freeze by the current Premier. That had

been a fairly minor reduction -- somewhere on the order of 1 to 2 percent across the board

for each of the two years preceding the freeze. But the freeze not only stopped

escalation, it stopped reductions, except in the case of rewarding people's individual

loss experience -- which is a positive, and one that we endorse.

[1520]

In the course of this debate, we will be hoping to get the answer we've asked for for

several years, which is . . . . ICBC does rate according to regions of

geography. It certainly must have -- certainly should have -- the loss experience numbers

for each of those regions, and it can compare the loss experience expense to the premiums

collected in a given region and tell us if any regions are subsidizing other regions.

I was interested that the minister touched on the issue of pollution and how ICBC's

initiatives help in that area, and I believe some of them do. But I believe that if ICBC's

rating structure and this premium freeze are causing some regions of the province to

artificially have to subsidize other regions of the province which are more congested in

traffic and have worse loss experience, then that policy of this government and of ICBC is

contributing to pollution. If people were paying their own freight in these regions and

were paying as much as they ought to pay in such congested regions, with the loss

experience they have, some of them might choose not to drive.

Briefly, some other issues that I've been sorry to see arise recently are areas where

ICBC has experienced bad press for things that it never used to do. We'll want to know

some of the reasons for those. For example, my experience over 20 years was that the

public was very clear on the matter of advertising. Surveys were done, and those were

expenses -- probably very reasonable and intelligent expenses. The public said -- time and

again, loud and clear -- that they not only would tolerate but thought it was a good idea

for ICBC to advertise its loss prevention initiatives. The minister has commented with

pride about the success of those initiatives.

I share that pride. The public doesn't mind advertising that, and the public doesn't

mind seeing advertising that explains the product. But other than that, it was always very

clear that the public has no tolerance for ICBC spending people's premium money blowing

its own horn or, for example, comparing its premiums to premiums across the country,

especially if the advertisements are subject to suspicion and question -- no tolerance for

that.

The minister referred to the purchase of real estate or the rumoured purchase of a

mall. Again, I would caution the minister that, in my view, that should not be allowed.

ICBC has to own some real estate or, at least, lease some for its

[ Page 12679 ]

operations. ICBC's premium funds and revenues are to be held for administration of the

company and primarily for the payment of claims.

Again, the minister has commented with pride on the statistic that ICBC is reporting

that 4 cents out of every premium dollar is spent on administration. That does compare

very well to insurance companies across the board. There have been years where ICBC pretty

well ran the whole company on its investment income, so it would have been close to zero

cents on the dollar, I believe. In these times of low interest rates, 4 cents on the

dollar sounds like quite an achievement to me. Nevertheless, any money that ICBC has,

whether it comes from interest income or from premiums, belongs to the motoring public of

British Columbia and, again, should only be spent or invested very judiciously.

Most of the time when this government refers to expenditures of operating funds as

investments, it causes cynicism. I do think there is some justification for referring to

the expenditures on loss prevention initiatives as being investments, in that I think

there is a direct payback to the people of British Columbia.

My party and the official opposition have come out against photo radar. We are not

happy with the administration or results of the program. We've committed to scrap it, and

that's what we intend to do. But that being said, there are many other programs that are

showing positive results.

To sum up, I have this brief commentary about advertising. I would like to see ICBC

cease advertising, other than for those areas the public has expressed support for. In

dealing with the issue of the purchase of a mall, we think that it is at risk of mixing

the responsibilities of other ministries in with those of the Insurance Corporation of

B.C. It ties up ICBC money in an asset that is not liquid. ICBC's claims reserves are

there to pay for people's injuries and damages. It is something that the opposition is

certainly opposed to. We also don't think that this government has a great record of

successfully investing, and we'd like the government to stay away from it. There are also

deep concerns over the expenditures of the corporation on its software, the so-called NGIS

-- next generation of insurance systems -- and I believe my colleague intends to cover

that.

[1525]

And finally, there is tremendous concern over the move of ICBC executives to offices in

downtown Vancouver. When I was at ICBC, and certainly in the management literature that

I've seen and studied since, there's been a tremendous emphasis, toward the end of this

century and throughout the nineties, on managers who are really in touch with their

people, who in fact include people in management decisions. Popular terms like

"management by walking around" have come and gone, but there's a general

understanding that it's good for managers and the people they manage to work closely

together -- to have frequent formal and informal communication and thereby benefit from

the insights and input of the experienced people who are doing the work on the ground and

who can make recommendations.

This seems to many people like elitism, like a group of managers moving across the

water away from the people that they're supposed to be working with. It isn't a good

thing. If the corporation's head office is becoming too crowded, which we understand has

been one of the responses, then the corporation should look at regionalizing -- genuine

regionalizing -- which has been discussed many times in the past. There are communities up

and down Vancouver Island and throughout the interior that are hurting for lack of

economic activity. If ICBC's head office is bursting at the seams in North Vancouver, then

ICBC could move whole departments -- hundreds of people, hundreds of jobs -- into

communities in the interior that could really use the economic activity. People would soon

find that they like living there. By the way, there's this cocooning mentality that seems

to happen in big cities. People don't realize what they're missing by not living up the

Island or living in Vancouver. I think that it would be a positive move for people. Also,

it would make more sense than taking your top echelon of management and moving them across

Burrard Inlet, separating them, at great expense, from the people that they're supposed to

manage.

In wrapping up, when I started with ICBC, it was still something of a hodgepodge

cobbled together. Wherever there was a warm body that had been working in insurance, ICBC

pretty much had to grab them and throw them into the breach in the middle seventies, when

the corporation started. It took a few years until things settled down and ICBC began to

develop a corporate culture and take directions that were, I'm proud to say, firmly

grounded in a belief that customer service, quality claims-handling and being a quality

employer for employees were very high priorities. With some hitches, ICBC moved along in a

good direction for the 20-plus years that I was with them.

The minister commented about the success of ICBC's loss prevention initiatives and how

few can pretend to have accomplished as much, when you look at other insurance companies

across North America and perhaps around the world. I'm a believer. I spent 18 years in

claims dealing with the tragedies and destruction that happen in motor vehicle crashes,

and the last two and a half years of my ICBC career in loss prevention. I wondered why I

had spent so much time dealing with consequences and so little time dealing with the

things that really could make a difference. So I applaud the road safety initiatives. Many

of these initiatives were advocated by the line staff for many years before they were

actually implemented, including graduated licensing and harsher, quicker responses for

impaired drivers. With many of these initiatives, it was a tremendous frustration to

people that it took so long.

[1530]

That's exactly the kind of problem that we're concerned about when ICBC management

moves away from the people that it needs to be listening to and liaising with on an

ongoing basis. I think moving managers away from the staff is a negative symbolic move.

It's deliberate ostracization perhaps. I think it's offensive to people, and I don't think

it makes sense -- let alone the cost. Once again, these are public dollars. Even if ICBC

is showing a very positive bottom line -- and we see that it is; again, my colleague is

going to be examining that in detail -- every dollar there was either collected from

people as premiums, or it's money earned as investment income on their money. Every dollar

must be carefully safeguarded and only used very wisely. Investments have to be liquid;

the money has to be there when people's claims need to be paid. One day they may well have

a catastrophic event, such as an earthquake in the lower mainland, where a great deal of

money is required. ICBC should never rest on its laurels or feel as though it has money to

burn. I trust that it doesn't.

With those comments to the minister, I look forward to moving on into the bulk of

Labour estimates. I'm pleased to

[ Page 12680 ]

turn the direction of this debate over to my colleague from North Vancouver-Seymour.

D. Jarvis: As my colleague from Kamloops-North Thompson has said, we're dealing

with public funds here, public moneys. We have to make sure they're handled properly. As

you can appreciate, it's our duty as members of the official opposition to make sure that

ICBC is being run in the best possible way. Actually, my feeling toward ICBC probably

isn't quite the same as his. I feel that ICBC is, in a sense, a bureaucracy expanding

unchecked.

The minister has said that everyone seems to be happy with ICBC. Later on, perhaps in

the next couple of days, I'll bring out my file, which is probably eight to ten inches

thick, and show him letters I have received over the last two years with regard to how

ICBC does handle their claims and the way the company is operating. It is certainly not to

suggest that ICBC has gone off on a tangent when they show the graph in their magazine

here saying that . . . . It looks like just around the 80-percent mark of

people are satisfied with the handling of their claims. This is not what we are hearing

out there. This is not what we're hearing from people inside ICBC, although that has been

shut down quite a bit lately.

The fact that most of the people in ICBC don't know whether it's an insurance company,

a health and welfare company or a road safety organization . . . . We

sometimes wonder. But I was glad to hear the minister say that they are, ostensibly, an

insurance company.

There's a question that I wanted to bring up to the minister to start with -- a few

questions. I'll sort of lump them together. I'd like to admonish the ministry over there,

in the sense that the financial report for the year ending December 31, which we received

late last night -- I received it somewhere around 5 o'clock . . . . When you

look at the Insurance Corporation's . . . . Revised Statutes, 1996

states that the report and financial statement must be laid before the Legislative

Assembly on a date within 60 days next, following the end of the year for which the report

and statement are made, if the assembly's then in session and we're still in the same

session all that time, or otherwise on a date within 15 days after the opening of the next

following session. So we're now, like, 120 days . . . .

Interjection.

D. Jarvis: We're in the same session. That's what it says here. You're now about

60 days behind when this report should have been submitted. Of course, we haven't had too

much time -- less than 24 hours to really examine it all. But, fortunately, there's a long

weekend coming up, and we'll have some questions more readily available and to the point

than what we're discussing today. It's now approximately 3:30, and we only have a couple

of hours left.

As I say, ICBC certainly appears to be a monopoly to most of the people out there who

are involved with it -- or not involved with it, one or the other -- through accidents or

just through having a policy. It's a true monopoly, from the top to the bottom. There just

seems to be no room for a choice. I think that the company itself or the monopoly itself

is deathly afraid of competition. Instead of having confidence in their corporation,

instead of just saying: "Come on in. Let's see what you have. This is how we work;

let's see how you can do. We think we can do better . . . . " No, it seems

to be cutting out any type of competition whatsoever -- also evidenced by some of the

actions they've been taking lately.

[1535]

I was also surprised that last year at this time, I asked if Bob Williams would be made

the chair, I was told no by the minister. So it's rather interesting to see that he's been

in the chair now for about ten months.

Interjection.

D. Jarvis: I have psychic ability. I would suggest that the minister listen to

what I have to say in the next few days, because this is what it's all about.

The other aspect was that I've now got into a position where I feel I've been asking

questions on ICBC estimates for the last two years, and in each of those previous two

years I've had a different minister. I'm now on the third minister. We have put before

them questions, and sometimes, due to the lack of time, they've asked that the questions

not be answered at that point because they didn't have the information available. They

said: "We will get back to you and write to you and give you the answers."

Well, it's not just one or two questions. I'm talking about half a dozen to a dozen --

maybe two dozen in the last couple of years. I regret to say that the promises were broken

every year, because, even with our follow-up letters to them asking them to answer them

and listing them again, they've never been replied to. I read them out of Hansard

at one time, too. So there's no question that they got lost in the mail.

Another aspect that I'm concerned about -- and I'm sort of bundling these together just

to make them part of my opening statement -- is that I wonder if it's in order that the

Premier has been setting these rates -- I was informed that he may have violated the

corporation's act -- or that he has announced the rates last year and the year before.

According to the act, the rates have to be set for ICBC one year prior to . . . one

year previously. That, to me, seems like somewhat of a small violation, not a major one,

but it's the Premier allowing politics to get in the way of running a corporation that's

supposed to be there for the benefit of people and not for the benefit of the reigning

political party.

If I could possibly go on to another subject -- because the minister can probably

answer these questions with just a couple of words -- I'd like to say that I'm somewhat

concerned about the position of ICBC, in the sense that, being a monopoly in British

Columbia, there's a possibility of manipulation of the company itself to the benefit of

whoever is running it on the government side. I think that is ostensibly wrong.

Interjection.

D. Jarvis: Mr. Chair, the minister is asking me to explain what I mean. Well, I

intend to explain it. There are decisions that have come down that are potentially coming

down through political expediency, which would cause the corporation to take a short-term

view of ICBC's physical realities. ICBC does not pay any income tax, so, of course, they

have extra moneys. As they pay no income taxes, they have . . . . It's

questionable, as they have no incentive to maintain really accurate financial results. I'm

not saying that they don't, but there's a situation, because ICBC does not have to audit

itself,

[ Page 12681 ]

as is done by all the other insurance companies across Canada . . . .

Private insurance is all regulated -- as you're probably aware, Mr. Chair -- by both the

office of the superintendent of financial institutions and the Financial Institutions

Commission. From what I understand, ICBC does not abide by that situation. So that is a

concern I have: that there is a possibility of manipulation going on of the fees, and just

the general running of the corporation.

Now maybe at this point I could sit down and have the minister sort of respond to some

of the statements that I've made -- which I think he probably wishes to do.

[1540]

Hon. D. Lovick: The member raises a number of points, and I will endeavour to deal

with each of them as briefly as I can.

First of all, regarding the annual report, he makes a couple of points. First, why is

it so late? And are we violating the rules by not having the information? He might like to

know that the year-end financial information he refers to did indeed appear in the

government's third-quarter financial report. So certainly in terms of its financial

obligations and its legal obligations, the corporation's doing precisely what it should.

It's true the report was indeed delayed a little bit. One of the problems was technical.

With the first batch of reports we got, the spines were faulty, and therefore they had to

go back to the factory and be glued. But that's not, frankly, an important matter.

What's important, though, is to correct the record. The member alluded to the fact that

they only got the report yesterday, and the estimates were supposed to begin yesterday. I

want to make two points. Number one is that we decided to go ahead with ICBC with

agreement from that side of the House and this side of the House, knowing you didn't have

the report. You could have waited. But you didn't; you chose to go ahead. And second, we

offered that member a technical briefing, and he told us he wasn't available until the

27th of the month.

So it's a little difficult, member, for you to stand there and say to us, "Oh, we

didn't have time; we didn't have an opportunity to look at it," when you turned down

the technical briefing and when your own people agreed to when we'd have this estimates

debate. Let's get that straight, first of all, and let's hope that we don't have to have

more of these silly kinds of games where people are trying to take shots at each other for

no good reason. Let's talk, rather, about the issues.

Re the matter of whether questions were ever answered, if you would be good enough,

member, to share with me a list of all of those questions, I will endeavour to ensure they

get answered sooner rather than later. My information is that there were no specific

questions; rather, there were various statements made. But we will certainly deal with

that.

Re the process of making a rate change, what happens is that the corporation's senior

management sits down and looks at what the circumstances are and what they think ought to

be, and then they make a recommendation to cabinet. Cabinet then announces the rate

change. That's the standard practice.

I think I've covered your principal points.

D. Jarvis: I don't want to get into a long discussion about this, either, but

with regard to setting up briefings and all the rest of it, that's not what we're talking

about. First of all, I put up some dates, and they put up some dates. No one could meet

together, and at that time, the 27th was the only date that we could possibly get

together, because I was tied up on different dates and you were tied up on different

dates. It wasn't as though it was available any time I wanted to up until the 27th. The

minister and his staff were tied up on a lot of those dates.

[1545]

It's a silly little argument, and that's not what I brought up. The aspect I brought up

was the fact that I felt that the financial statement should have been brought forward

sooner. And according to the rules and regulations, it should have been.

First of all, I would like to say something good about ICBC. It happened through one of

my constituency offices; a constituent was having a problem. She is a senior, Mrs. Shirley

Iaci -- and I think that maybe the gentlemen over there are aware of her. She had been

complaining that the discount to seniors wasn't following its way down to the seniors that

should have been entitled to the discount. Ostensibly, it's because the agents gave such

different statements like: "We didn't want to ask you because we were embarrassed

that we might be considering that you're older than what you are" -- and all the rest

of it. She was having a devil of a time getting her discounts for the previous years, the

years that she has been a senior. I understand that ICBC is now going to go back through

their files on this, for those that are 65, and automatically give them their discount,

heretofore not having done that. So that was one of the good things.

I want to ask the minister's opinion about ICBC being a bureaucracy that is controlled

ostensibly by the government, to a certain degree. But it is a monopoly. An

article came

out the other day from Trac Insurance Services, which I imagine staff are aware of. Trac

bases its calculations . . . . First of all, it's a business that started out

to check on the financial strength of competing insurance companies across Canada. It

found out that this information was publicly available, which allows them to gauge the

financial strengths of insurance companies across Canada. It was also created to give

warning indicators of difficulties which could lead to insolvencies by different insurance

companies. Trac based its calculations on the rating opinions and exhibits in insurance

companies' statutory statements filed with the Canadian federal and provincial regulators

-- which I don't believe ICBC does, but they probably send their information to them.

These uniform audit statements must be filed with the Canadian regulators annually by

every licensed company or foreign branch, by law. Every year this company, Trac, requests

the annual filing statements from all the federally and provincially licensed property and

casualty companies in Canada.

It's interesting to read some of their information with regard to establishing

insurance risk ratio. ICBC in 1997 had a grade of 99.9 percent, which is off the scale,

evidently. It had failed for the fifth year in a row in comparison to other insurance

companies. That was the insured-risk ratio. It got a pass in the change in net premiums

written; that's a nice pass. It was very low in what they call a test 4, two-year

underwriting ratio, and failed on that one for the seventh year in a row.

[1550]

So it's obvious that ICBC isn't what you would call -- as the minister has tried to

suggest to us -- the best insurance

[ Page 12682 ]

company in Canada. It's a good insurance company, but it fails on a lot of things. I'm

wondering if the minister would like to comment on that.

Hon. D. Lovick: The minister would be delighted to comment. Trac is the advocate

of the private insuring lobby. You're dealing with a public corporation insurance company

here in British Columbia, which is arguably, of course, a monopoly. That's what Trac and

the private insurance lobby is opposed to. Now, are we all surprised to discover that they

give a rating to ICBC and say: "Hey, hey, you guys didn't get an A-plus"? Let's

get serious.

The reality is that one of the criteria that the private insurance corporations use in

terms of evaluating the public corporation is the rate of capitalization. Because of the

fact that 60 percent of ICBC's premiums are in fact as a result of monopoly, they're

guaranteed. Therefore we don't have to have the same ratio in terms of investment. But by

that standard of the private sector, the public sector fails. So that's the only answer,

effectively, to the member opposite. If you're somebody whose objectives are diametrically

opposed to a public corporation, and you evaluate the public corporation by the private

sector's rules -- which, as I say, are opposed -- then demonstrably and clearly you're

going to get the conclusions that the member refers to. ICBC doesn't require the same

capital-to-investment ratio simply because, as I say, it's got that monopolistic position.

It also has the government of British Columbia standing behind it.

D. Jarvis: Well, that's probably the point that I and the rest of the people are

trying to make: that ICBC is not running a good insurance company, in that sense. They are

monopolistic. ICBC failed four of the eight, I think. I mean, they didn't get a complete

fail; they did not fail all eight of the Trac solvency tests.

Interjection.

D. Jarvis: The minister may say, Mr. Chair, that it's irrelevant, but it's not.

I know I'm supposed to talk to you, but the minister keeps hollering at me across the

floor.

It's not irrelevant; it is what is happening out there. There's a problem with ICBC.

It's quite apparent that there are things out there in private industry that would benefit

the insured of British Columbia. You are inflating the rates in B.C. to benefit -- not the

insured of British Columbia . . . . We are paying higher rates than we

normally should be paying.

I have another

article here. I was going to bring up that . . . . What ICBC

is doing isn't necessarily in the best interests of the public out there. I don't think

there are many people in this province who would not stand up and say they are paying too

much insurance. The records do show, when you compare it . . . . All you have

to do now is go to the Internet, punch in your car and some variables, such as your age,

where you live, etc., and you can find, in comparable cities across this country . .

. . It's not just Vancouver, Montreal, Toronto or something like that; we're

talking about Abbotsford, picking out a comparable city to that. ICBC rates are higher,

contrary to what they try to tell you, which is that they're not. They are higher.

We have asked ICBC several times -- and it was alluded to by my friend or associate

from Kamloops-North Thompson . . . . We should be investigating what rates

other areas are paying, how they are paying them and a breakdown of the rates. ICBC has

even been FOI'd. It's in the public's interest, but ICBC says that they don't want to

disclose this information. We wonder why they wouldn't want to disclose it. The public has

a right to know if they are being treated fairly -- or badly, I should say. ICBC feels

that they will not give this information and feel that they don't want to do it. There is

a dispute. Why don't they just open up their books and let us look at them? But they are

controlled . . . .

[1555]

Hon. D. Lovick: I understand that this is precisely the same set of questions that

the member posed last year, and therefore pardon me if I bore him by giving him the same

answers. But there are only so many answers to the same questions.

The fact of the matter is that it's largely because we are in competition with others

that we are not going to broadcast and open our books as the member says. ICBC, as I'm

sure the member knows, is in fierce competition for that 40 percent, roughly, of optional

coverage -- and it is fierce competition. Other people can come in here and can do what in

the trade is called "creaming." They can go to some individual who has driven a

small, underpowered sedan for 40 years and who has never had an accident and say:

"Maybe we can give you a better rate." They will try to get those people --

those people who are low-risk candidates -- and try to entice them away from the

corporation. That's what's happening.

ICBC therefore is in the role, so that it doesn't become simply an insurer of last

resort, of having to compete with those people. Therefore all kinds of programs --

RoadStar and RoadStar Gold, those kinds of programs -- try and compete with those private

sector ventures and thereby maintain the integrity of the total insurance package. Because

of that fierce competition, obviously they're not going to publish the rates in Abbotsford

versus the rates in Courtenay, or something like that.

What I can tell the member is this: no region is subsidizing others. In particular, we

are looking at more specific things like some of the challenges within particular rate

groups that may be problematic. We are therefore attempting to deal with those where we

can. But again, for the reason I just gave, we're not about to suddenly say, "Here is

everything we're doing," because what will happen then is that somebody else will

come in and try to steal that particular niche of the market. It's fierce competition out

there. The member, I believe, has a business background, and I would think he would be

persuaded by that argument.

The other point I want to make -- and I must make -- at this stage goes back to the

issue of whether ICBC functions on the same basis as the private insurance corporations

and needs to have the same amount of cash in the bank, as it were. The reason the private

sector demands that so rigorously is simply because there is a fairly significant history

of private insurance company failures. If an insurance company fails, what happens to all

the policyholders? They're are obviously caught. To protect against that kind of thing

happening -- as it can happen, obviously, in the private sector -- the regulatory

authorities are going to demand much more stringent regulations and restrictions. Given

ICBC's position -- its monopolistic position in this province -- we don't need to do that.

The other point I want to make . . . . I have to say this because we don't

function as free agents in this place. In other

[ Page 12683 ]

words, there's an opposition and there's a government side, and the opposition stands

for X and the government stands for Y or Z or something else, and I am having real

difficulty when I hear the principal for ICBC on that side of the House praising ICBC and

apparently endorsing the concept of a public insurance corporation, but the deputy critic

seems to be leading us in a line of questioning that says there should be no such thing as

a public insurance corporation. I'd like to suggest that maybe the opposition get its line

straight, so I will know what the position is that I'm supposed to be debating.

D. Jarvis: It was very interesting to hear what the minister had to say. There

is really no conflict between the two of us, referring to my associate from Kamloops-North

Thompson, in the sense that neither one of us said that we should get rid of ICBC. All

we're saying is that ICBC should be competitive out in the marketplace.

Interjection.

[1600]

D. Jarvis: With regard to the last statement that the minister made . . . .

That's a given, then.

Okay, let's give him the situation where he said I asked him last year about the

non-compulsory rates -- to have the information put forward. But what about the compulsory

rates? Why does ICBC not open those compulsory rates out so that we can examine them and

see whether they are competitive? ICBC enjoys a legislative monopoly over the business

that we're talking about. Other insurers cannot use this information against ICBC, because

they have competitive control in this province. There are no competitors for mandatory

auto insurance in British Columbia. The rate system for compulsory insurance cannot be

used against them, because ICBC has a complete monopoly on it. British Columbians are

required by law, as I said, to purchase their mandatory auto insurance from ICBC.

Therefore, the information, even if it was released -- on the compulsory side of it --

couldn't be used to discredit ICBC or give them any discomfort.

Hon. D. Lovick: The primary reason that the information the member refers to as

part of the compulsory package hasn't been published is simply because: why would we?

There is nobody else who is competing for that market. Remember that nobody else is in

that game of having to insure everybody. That's what ICBC does as a public corporation. It

says: "We will insure you, and we won't violate you in the same way that the private

insurance companies did for years before ICBC" -- which the member is old enough to

remember, as I am. If you happened to be a kid who was 22 years old, you couldn't have a

car. You couldn't afford it, because you were being ripped off, effectively, by the car

insurance company. The vision of ICBC was to say that we will make that insurance

available to everybody, and we will spread, if you will, the risk among a larger portion

of the population so we can afford to do that. If anybody else were working in the same

universe, then there might be an argument for presenting that information.

The second point I would make is that I understand the information the member is

requesting has indeed been offered by way of briefings, and those briefings have not been

accepted.

D. Jarvis: I am completely unaware of the briefing that . . . . I

wanted to get that information out so that we could compare and see whether ICBC rates

were too high. He is saying that he won't do it because he feels that the rates that are

out there now are good. He refers back to the days of yesteryear when the bad drivers had

to pay more. That is exactly the question. Why should the good drivers pay 20 percent

more, when the bad drivers in British Columbia pay 40 percent less?

As I say, the public has a right to know. This is a public corporation. They have the

right to know if they are being treated badly by ICBC with regard to their compulsory

rates. Most of them out there feel now -- the good drivers -- that they're paying too

much. The bad drivers are getting a good break and probably paying too little. That's why

this information should be made available.

K. Krueger: The minister said flatly that there is no subsidizing from one

region of the province to another. If that's true, we could clear this issue up right away

and get on with things. We haven't been asking for a person-to-person comparison or even a

rate-class-to-rate-class comparison. We've been asking for the statistics as to the dollar

amount of premiums collected in each region and the amount spent on claims in each region.

I gather that the minister's advisers just told him that there is no subsidy; in other

words, each area's premiums pay for that area's claims and no more.

[1605]

I can tell the minister that in the early nineties or late eighties I kept track of the

premiums collected in the region I was responsible for and the claims that arose out of

that region. A single broker -- the largest broker, mind you, with multiple branches --

collected enough money in premiums each year to pay all of the claims for a huge area

around Kamloops. The rest of the money went somewhere else. I and others tried to convince

the corporation for years to rate regionally, to deal with that discrepancy. The

corporation was moving in that direction prior to the premium freeze.

I don't believe that information is accurate, because of the premium freeze. But the

minister has stated that flatly, and we take it as truth. Therefore we'd like those

numbers to be turned over to us promptly. That will end this line of questioning.

Hon. D. Lovick: My information is that the policy is that no region will be used

to subsidize others. If indeed that's happening, then changes will be made. That's why I

said this is under review -- that's the point. I understand that it is under review, and

perhaps some changes will be made. I hope that clarifies . . . .

I take the member's point that what we're looking at is not individual drivers but

rather discrete measurable clusters, if you like, in regions. Obviously that is the policy

that the corporation is looking at. I hope we will have some information for him. However,

that same problem with competition, I think, is the reason why the corporation is not

about to give out every bit of information every week as it gets it, which the member, of

course, will appreciate.

K. Krueger: Just to be really clear, then, we're asking for the global numbers

for each region. If the corporation's response was, "We don't want to give you that,

because it would give our competitors an advantage," then the corporation is saying:

"We are charging too much in certain regions, and our competitors would wipe us out

for that reason." If

[ Page 12684 ]

that's the truth, the public's got a right to know. Will the minister commit to give us

those numbers today?

Hon. D. Lovick: I'm advised that since the member left the corporation, a new

regional system has been imposed, and we will be breaking it down in precisely the way he

mentions. That hasn't yet happened, but it will be announced fairly soon.

D. Jarvis: Perhaps we should change the subject, get off some of the philosophy

end of it and ask some basic things. With regard to the financial report that came out for

the year ending December 31, 1998, I was wondering if the minister could explain to me why

income is rated at $120,465,000 -- or $120.5 million. Then, they have deleted the road

safety dividend of $47 million from it to show a net income of $73.4 million. That's in

your statement on the first page. It shows the net income and/or loss for the year as plus

$73.465 million -- right? I assume it's right. I was wondering why they would delete the

road safety $47 million . . .

F. Gingell: And they'd charge it out in '98 instead of '99.

D. Jarvis: . . . and why they would charge it up to '98 when it

didn't come into effect until '99.

Hon. D. Lovick: It was a dividend paid from '98 premiums.

[1610]

D. Jarvis: In the meantime, we have a little confusion. My associate from Delta

South would like to ask a question on that subject. He'll only be in town for the day.

He's a gentleman politician, so I'm going to allow him to step in and ask that same

question or a question related to it.

F. Gingell: I take it that the dividend is earned. There's no action that you

can take; there's nothing that can happen after December 31, 1998, which would take away

your right to the dividend. It's for actions in the past, for your record in 1998. If you

had an accident in 1999, you'd still receive it.

Hon. D. Lovick: That is correct.

F. Gingell: That was a long walk for one question. Thank you.

D. Jarvis: The member tried to clarify that point, but I was really concerned

about it. Again, why would you take . . . ? Sure, it's premiums from '98, but

they didn't come into effect until '99. I think it was February -- wasn't it? -- that the

road safety discount was first announced. So in a sense it does take away from the actual

profit that ICBC made -- $120 million. Why would they show it this year and not as an

expense from last year, even though it was moneys from '98? If you go out and purchase

something today, do you charge it up for last year? That's ostensibly what it looks like

there. I think you've deflated the profits that ICBC is making, and that, I think, is not

ethical. Maybe ethical is the wrong word.

Hon. D. Lovick: I confess that I am entirely at the mercy of my officials here,

because I do not claim to understand this dimension of the corporation. But I am advised

simply that dividends are always declared at the end of the year, once all of your books

are completed and all of your accounts are in fact settled. That's when you decide whether

you can declare a dividend.

D. Jarvis: I was wondering if the minister could give us some information with

regards to the different -- I had a little slip of paper here; I'm going to find it

somewhere -- programs that they're running and if he could give me the dollar-and-cent

figure, the gross figure for each one, starting with CounterAttack. Can I read off the

list for you, and then we can do it? It's CounterAttack, photo radar, intersection radar,

road safety . . . .

Hon. D. Lovick: Road safety?

D. Jarvis: I'm not sure whether it's road safety or improvement -- one or the

other. And it's commercial vehicle safety, graduated-licence safety, vehicle design

improvements and community involvement. I don't know if community involvement also takes

in the fact that ICBC gave money for crossing guards. Is that community involvement, as

well, or is that a separate item?

[1615]

Hon. D. Lovick: There may be some others that I didn't pick up, but I'll give these

ones first, and then we can come back. Under the road improvement category, we're talking

$8 million. Under photo radar, we're talking $3 million. Under red-light cameras, we're

talking $2.2 million. Under speed corridors, we're talking $3.4 million. Under

CounterAttack, we're talking $5.5 million.

Let me, if I may, comment on a couple of those that I have some personal experience

with. I was in North Van a month and a half or so ago when they did an announcement about

the speed corridors and how that program worked. It's essentially a matter of the old

deterrence policy in action. What you say you're doing . . . . What you do,

first of all, is enhance the enforcement of speed limits in corridors that are identified

as being problematic and likely to produce a greater incidence of traffic accidents. The

important point of it, though, is not so much the fact that you're putting people out

there who are going to be pulling over drivers who are exceeding the speed limit. Rather,

what you do is announce it with great fanfare and make it into a great statement that

you're going to do it, with a view to essentially persuading or otherwise deterring people

from that behaviour.

An Hon. Member: The risk of apprehension.

Hon. D. Lovick: Yeah, the risk of apprehension, if you will -- exactly. That, I

think, is the explanation for it. Certainly it's something that the law enforcement

authorities were enthusiastically supportive of. The reason I'm saying this now is that

the conclusion from this program and indeed all of the others is that those kinds of

things will pay huge dividends in the incidence of crashes and in the severity of crashes.

It's true that you may not see the immediate return within this fiscal year, but down the

road you're going to. Indeed, we've seen that evidence already, we think, in terms of what

the corporation has done. We're talking about -- what? -- 10,000 fewer accidents in the

past year. To be sure -- and I wouldn't for a moment pretend that everything is directly

connected or that

[ Page 12685 ]

there is a clear causal relationship between programs like this -- they certainly have

had some impact.

The speed corridor one . . . . I chose to jump up and speak about that one

because of all the measures I knew about, it was probably the one I was least persuaded by

until I talked to the police constables over there, who explained to me why they were

doing it and why they thought it was a great idea.

So that's the basic argument for all of these initiatives that I have referred to and

why we think the money is well spent.

F. Gingell: I must say that that was a most interesting discussion, because I

always knew this government believed that the way you run the world is by having a press

release, a photo opportunity, a slogan and a new T-shirt. I'd like to suggest to you that

if it happens to be working in this case, it is a rare occasion indeed.

Hon. D. Lovick: That's what the federal Liberals do all the time.

F. Gingell: Yes.

If I may, I would like to engage the minister in a little philosophical discussion. I

think that it's worthwhile, and I know the minister likes that. Over the years when you

work in your constituency office, and the phone rings and you pick it up, there's usually

somebody who's mad at someone. The advantage of being in opposition is that it's usually

the government that they're mad at. If you look at a list of who they're mad at, it's a

social worker who won't approve a welfare cheque, it's anybody who's got an outstanding

claim with the Workers Compensation Board, and right at the top of the list -- right at

number one -- is anyone who has an insurance claim.

[1620]

Years ago when I was in practice, I used to do a lot of work for insurance brokers --

some reasonably large ones. They insured you; they looked after you. They got a commission

of 7.5 percent to 15 percent, depending on whether it was a homeowner policy, a liability

policy or an insurance policy. There was a clear understanding -- a very clear

understanding -- that they represented you.

In this day and age we seem to be getting some of those issues confused. We deal with

banks that will both lend you money and underwrite your house insurance. Whose interests

do you think they're looking after if the house burns down -- the underwriter or the poor

mortgage holder, the mortgagee or the mortgagor? We get confusion into the issues of the

stock market, where banks are in the business of making substantial loans to business

corporations and selling you their shares. Perhaps the issue of keeping share prices up is

of concern to them.

I look at these interests that I see as conflicts and get concerned about them. I see

them particularly in ICBC. If I have an accident now -- and pray I don't -- the first

person that I talk to is an ICBC employee, an adjuster. I don't phone my broker, who says:

"I will get an independent adjuster to look after your interests." In fact, I

don't even get my broker -- maybe "broker" is wrong. But the broker doesn't

immediately volunteer and say: "Forget it. I will phone them. What time did it

happen? Do you have an accident report number?" They have become employees -- paid on

a commission basis -- of ICBC.

It seems to me that nobody is looking after the interests of the insured. We're not

trained to; that's not our business. We're not lawyers -- well, some of the members of

this House are. But we aren't trained to those specialties. But I have to deal with

someone who is. I have to deal with someone who does it seven hours a day, five days a

week and is a real expert. I'm at a disadvantage.

I think what it does, of course, is make the system more adversarial. Instead of

adjusters settling claims, I would imagine, statistically, that if you were to go back

pre-ICBC . . . . If you were to go to other provinces where there is no

state-owned insurance company, you would find -- I would imagine; I have no knowledge, but

my tummy tells me -- that there are far more claims settled in the normal process of

adjustment rather than . . . . We always seem to be in court, getting a new

lawyer, you know, and all the problems that go on. I guess my question to the minister is:

do you care?

Hon. D. Lovick: I thank the member for his question. He and I, I think, make

common cause, because we both believe that too often we get caught up in the minutiae, and

we forget what the philosophical underpinnings of systems are and why we do what we do.

I'm happy to join that particular debate.

He began by offering some experience as a constituency representative. Let me offer

mine, as somebody who has done it a little bit longer. When I was first elected in 1986,

ICBC was not only one of the major problems my constituency had to deal with, it was the

worst. It was the top of the list -- worse than welfare and WCB, and that's a horrible

commentary. In the last two or three years it's become about number six or seven in terms

of the regular complaints. Now, that may have something to do with the people who operate

the office in my riding, as opposed to the member's riding. I don't know that. All I know

is that there has been, from my perspective, a demonstrable shift -- okay? -- in rates of

approval.

Not too long ago I met with the representative of the Trial Lawyers Association of B.C.

who lives in my constituency. Listening to his perspective, of course, it was very

different. He said: "Nothing has improved. It's still awful, etc., etc." His

primary contention was -- and I think the member will appreciate this -- the insensitivity

and the fact that it appeared that nobody was looking out for his interests and that,

rather, "I was the adversary," as he points out.

[1625]

I disagree with that, by the way. I don't believe that because you have a corporation

such as that, where you deal directly with an employee who is the adjuster who deals with

your case, that it necessarily (

a) is an adversarial relationship or (

b) is insensitive. I

don't mean to play dirty pool, but I would just suggest that if the member were to talk

with his colleague from Kamloops-North Thompson, who worked in that business for a long

time, he would probably say that he and most of the people he worked with as ICBC

employees were probably doing their level best to treat customers with sensitivity and

understanding and to treat them as fairly and expeditiously as possible. I don't think

that because it is a public corporation, set up in the way it is, that will necessarily

have any other influence or impact.

In terms of the alternative model . . . . The member -- I believe I heard

him correctly -- suggests that ICBC has a higher incidence of litigation or something and

that lawyers are involved . . . .

[ Page 12686 ]

Interjection.

Hon. D. Lovick: Yeah. I would suggest: absolutely not. I would think quite the

opposite.

The paradigm illustration would be a place like California or something, where car

insurance is the game -- okay? Indeed, one of the problems . . . . The reason

I mention that is because I think part of the problem is that we, in this society, are

working towards creating a society that is increasingly becoming more like the American

one and more litigious. I'll give you an example. How many commercials has the member

watched on television, as I have, in which you have law firms saying: "Don't go and

settle your claim. Don't go and deal with that big, bad corporation, because they might

not treat you well. Instead, come and talk to us, and we'll get you more"?

That appeal to an individual's greed -- larceny, in some cases -- is powerful indeed

and I suspect, one of the reasons why people . . . . Beyond the other impulses

to a more cynical and difficult social climate we live in these days, one of the impulses

to challenge the corporation and why people are frequently predisposed to say, "Well,

I didn't get a very good deal; they didn't offer me enough money," or, "They

weren't sensitive," is because they have been raised in a culture, increasingly,

where they believe that: "Hey, if I get dinged in an accident, I'm going to get a new

car. Or I'm going to get a good lawyer who's going to take them to the cleaners so that I

can." That, unfortunately, is becoming the dominant culture in our society --

sometimes. I overstate a little bit. But I think that's the pressure, if you will, that a

corporation such as ICBC faces.

To wrap up this rather discursive and lengthy answer, I know that the corporation is

mindful of that. In my two or three meetings with senior management, I've raised the same

issue. I understand that they are investing significant time and money and energy into the

matter of training their people to ensure that the interaction between customer and

corporation is indeed sensitive, respectful and so forth. The member asked a philosophical

question; there's a philosophical answer.

F. Gingell: I actually referred to other provinces. I think statistical

information would be a little more relevant. Does the minister have the feeling that the

insurance agent, though, has been taken out of the picture, that the insurance agent has

become a commissioned salesperson for ICBC? One hears from constituents who are brokers,

who are unhappy about reduced rates of commission, etc., and I wonder what the attitude is

within ICBC -- hard to measure -- in dealing with the agents. Are they treated truly as

representatives of the insured?

Organizations tend to become what senior management wants them to become. Over the

years, I dealt with businesses which were entirely different. You could see attitudes in

senior management that were reflected in the actions of the next level of management,

because that's how people think you get on. If the senior management are a bunch of

s.o.b.'s, you become an s.o.b. -- that's the way you'll get promoted. But if there is

understanding and respect and, more importantly, your word is your bond, then that becomes

the approach. So I hear the minister responding, saying: "Yes, ICBC is conscious of

the issue. They're trying to do something positive about it."

[1630]

I'd just like to finish with one last question, then: has the role of the agent been

evaluated recently -- i.e., what is it reasonable for us, as insured, to expect from the

agent, and what is reasonable for the insurance corporation to . . . ? The

agent sometimes has to get mad at you, because he can't get through otherwise. That

doesn't do them any good, but it is representing, perhaps, the interests of the insured.

Hon. D. Lovick: I thank the member for the question. I'm not sure whether he's

aware that the corporation recently signed a five-year accord with the brokers, some 900

people that sell on behalf of the corporation. Part of the arrangement is an ongoing

discussion, I gather, to work with us in terms of perhaps modifying that role of a broker.

So there is that additional -- I won't say obligation -- commitment to the customer in

terms of being the interface and the connection with the corporation. Those discussions

are ongoing. What may come of them I don't know, but I do know that the five-year

agreement has been signed with the brokers. They're apparently happy. They've obviously

bought into it.

I also know that there's another trend in the industry, apparently, which is to do away

with brokers entirely in the private sector, where you simply walk in, and they . . .

. The single one-stop shop, or whatever it's called, next to the Money Mart or

something -- I think the corporation is probably moving in the right direction in this

area.

L. Stephens: I'm pleased to join the estimates debate on ICBC. I have a couple

of questions. One of them relates directly to an ICBC-proposed project in Langley, along

with the BCTFA and the Ministry of Transportation and Highways. It's a joint safety

improvement program, and it is the one that is being proposed for the Langley bypass,

Highway 10.

This initiative had been talked about, about a year ago, and there had been plans and

consultations with the businesses along that particular corridor. That consultation didn't

happen. What we have now is a proposal from the three -- ICBC, the BCTFA and the Ministry

of Transportation and Highways -- to proceed with this particular initiative.

I have a study here which was done by G.D. Hamilton Associates that looked at the

reason for why this may come forward. It was 60 accidents a year -- that's two accidents a

month -- and 32 percent of those 60 accidents were rear-enders. That was by far and away

the largest number of vehicle accidents. It seems to me that . . . There are

four lanes -- two lanes going one way and two lanes going the other way -- with a median

down the centre -- a suicide lane, people call it -- where people are allowed to get into

that lane, and they can turn left or they can turn right. That has worked very well.

The whole bypass has businesses. As a matter of fact, there is one right at the corner

of 200th Street and the bypass that is new. It's a huge, huge retail and commercial

development. There's a piece of property just east of that, which is now vacant, that is

going to be even more dense. For those businesses not to have access in and out onto the

bypass is . . . . Well, people are very, very upset and concerned about it.

That's on the north side of the bypass. The south side of the bypass is where Langley

city is proposing their Liberty Street development. That's the one where we're looking for .

. . . If we want to talk about road safety, we can talk about the rail overpasses

on 200th Street and 202nd Street. That would make a lot more sense. It would be a lot more

cost-effective, and it would certainly provide a higher level of

[ Page 12687 ]

safety. The federal government has been pretty adamant about trying to make sure that

people aren't parked on the railway track, and that's what's happening.

[1635]

If we're going to talk about safety, that would be a more appropriate place to look at

getting some kind of joint effort going, as opposed to the bypass, because at the moment

the bypass is operating just fine. With the proposals that are coming forward with the

channelization, that means that there's going to be a lot of businesses that are not going

to have access.

I would just like the minister's direction as to how to proceed with this or what to do

with it. This has just been presented to the city, the residents have just become aware of

it now, and there is a high level of anxiety, to say the least. I think that there are

other projects that would be a lot more effective -- certainly security-wise and

road-safety-wise as well.

Hon. D. Lovick: I feel like a Highways minister. I remember that in the old days

of the estimates debates, every time a Highways minister stood up, what used to happen was

that somebody would do precisely what the member opposite does -- which is absolutely

appropriate -- and say: "Look, I've got a problem in my constituency; please have a

look at it."

What I will do is I will respond in the appropriate way. I'm not familiar with the

case. I know about the ICBC road safety improvement program. What it is, essentially, is

that the corporation has a certain budgetary item to do that. It does it in consultation

with the Ministry of Transportation and Highways. Our basic rule for that program is that

we need to have guaranteed payback. In other words, show us that if we invest money

improving this particular piece of road, doing something of that kind, there will be a

return that is demonstrable, measurable and immediate; otherwise, we don't buy into it.

If in fact the case that the member describes is problematic and isn't going to work,

then she has every right to question the wisdom of proceeding. What I will do is give her

the assurance that we will review this matter. I'll discuss it with my colleague the

Minister of Transportation and Highways and see if we can't get her an answer. I'd be

happy to do that.

L. Stephens: Thank you very much, minister, for that direction. I will be

speaking with the Minister of Transportation in his estimates as well.

On the issue of the economic benefits of this, I think that if you look at 60 accidents

a year and 32 percent as mid-block collisions that are rear-enders . . . .

Investing that kind of money, doing that kind of economic disadvantage to businesses in

Langley, doesn't add up. I mean, just a preliminary look at the numbers and the disruption .

. . . That doesn't add up to be a cost-effective way to deliver road safety,

certainly not there.

There's one other issue I want to raise as well. That's the towing companies that tow

for ICBC. What I've been told is that they are under considerable strain. They're having

to pick up cars that people just kind of push out of their driveways and park on the side

of the road. You know, ICBC calls them and away they go. They pick them up and take them

to their yard. There are no plates on them. So there they sit, taking up space in their

yard. Then they, of course, are responsible for disposing of these abandoned vehicles.

Then you get vehicles coming in from out of the province that are unregistered. The same

thing happens. The problem here is that the yards are having to store these vehicles, and

then they are having to dispose of them themselves. Is there any way -- or has there been

some discussion on how -- to resolve this issue for these towing companies?

Hon. D. Lovick: I'm pausing befo