May 21, 1981 ALBERTA HANSARD 849 LEGISLATIVE ASSEMBLY OF ALBERTA Title: Thursday, May 21, 1981 2:30 p.m. [The House met at 2:30 p.m.] PRAYERS [Mr. Speaker in the Chair] head: PRESENTING REPORTS BY STANDING AND SELECT COMMITTEES MR. KNAAK: Mr.

Speaker, as chairman of the Private Bills Committee, I'd like to report that the committee has had under consideration certain petitions which did not comply with Standing Order 77 in that they were com­ pleted after the filing deadline, and recommends to the Assembly as follows: That Standing Order 76(2) be waived to allow the peti­ tion by the Sisters of Charity of Providence of Calgary, Salvation Army — Canada West, the trustees for the Children's Fund, and the Widows and Orphans of the Police and Fire Brigades of the City of Calgary, for the Burns Memorial Trust Amendment Act, 1981, be pre­ sented to the Assembly, and for the petition to be pro­ ceeded with during this sitting.

That Standing Order 76(2) be waived to allow the following petitions to be presented to the Assembly, but that they be dealt with at the fall sitting: the petition of John Falconer, Frederick L. Fenwick, Ronald D. Ghitter, Douglas Martin, Howard P. Miller, Hayden E. Smith, W. Rees Taprell, and Alexander Fraser for the Calgary Foundation Act; the petition of Colin Taylor, Larry T. Andrews, John F. Hunt, Robert L. Brintnell, and Kim- berley Israel for the Richmond Gate Trust Company Act, the petition of Gordon D. Wusyk, Ed Tonn, Karen Brust, Hugo Witzke, and Harvey A.

Brust for the North Ameri­ can Commercial Trust Company Act. Mr. Speaker, I also wish to report that the Private Bills Committee has had under consideration Bill Pr. 10, The Alberta Bible Institute Amendment Act, 1981, and rec­ ommends that it be proceeded with. The committee has also had under consideration Bill Pr. 9, The Paramount Life Insurance Company Amendment Act, 1981, and rec­ ommends that it be proceeded with, with certain amendments. Mr.

Speaker, I move that the Assembly concur in the reports of the Private Bills Committee. [Motion carried] head: INTRODUCTION OF BILLS Bill 52 The Banff Centre Amendment Act, 1981 MRS. OSTERMAN: Mr. Speaker, I request leave to introduce The Banff Centre Amendment Act, 1981. The purpose of this Bill is to bring The Banff Centre Act into a position consistent with other legislation governing postsecondary institutions. [Leave granted; Bill 52 read a first time] MR. CRAWFORD: Mr. Speaker, I move that Bill 52 be placed on the Order Paper under Government Bills and Orders. [Motion carried] Bill 233

An Act to Amend The Police Act, 1973 MR. COOK: Mr. Speaker, I beg leave to introduce

An Act to Amend The Police Act, 1973. The Bill provides for the creation of an Alberta provin­ cial police force. This in no way reflects on the fine job the RCMP are presently doing for the province of Alber­ ta, but it reflects growing concern over the difficulty of attracting sufficient officers to police, a growing need in Alberta for police service, as well as reflecting concern about the vastly increased costs charged by the federal government for the provision of RCMP services. [Leave granted; Bill 233 read a first time] head: INTRODUCTION OF SPECIAL GUESTS MR. HIEBERT: Mr.

Speaker, I have the privilege of introducing some special guests in your gallery. We have the pleasure of introducing to you and members of the Assembly the newly elected president of the PC Party of Canada, Mr. Peter Blaikie. Peter is accompanied by Marion Morstad, a national director for the party and a constituent in Edmonton Gold Bar. Will you give them a warm welcome. MR. KOWALSKI: Mr. Speaker, I'm pleased this after­ noon to be able to introduce to you and members of the Legislature 26 young people from Covenant Canadian Reformed school at Neerlandia, Alberta. They're accom­ panied by two teachers, Mr.

Jake Hoekstra and Mr. Cor Aardappel. Neerlandia, approximately 12 miles north of Barrhead, is an extremely productive agricultural area. I would ask that the group rise and receive the warm welcome of the House. MR. KNAAK: Mr. Speaker, it gives me great pleasure today to be able to introduce to you and to my colleagues in the Assembly 45 students and their band director, Phyliss Deeks, from the Fielding Drive school in Ottawa. I might just mention in passing that I was pleased to learn today that Phyliss Deeks and my wife went to the same high school in Ottawa.

The students are on an exchange program with 60 students from Vernon Barford junior high, a fine school in my constituency. These students are in the gallery as well. These students have their band leader, Marlene Norquay, present. The following chaperones from Ottawa are also present: Donna Collins, Jeanette Scott, Eunice and Glenn MacLeod, and Ken Gollans. The Edmonton chaperones include Judy Hayman, Anne Filipchuk, Bar­ bara Jones, Virginia Jaster, Mary Masterton, and Adina Krawchuk. Mr.

Speaker, I think it's a great event when we have students in this age group spending time together and, I presume, living at each others' homes. The Edmonton group was in Ottawa for a week, and the Ottawa group is

850 ALBERTA HANSARD May 21, 1981 in Edmonton for a week. I'd ask them to stand and receive the warm welcome of this Assembly. head: ORAL QUESTION PERIOD Energy Negotiations MR. R. SPEAKER: Mr. Speaker, my question to the Minister of Energy and Natural Resources is with regard to the energy negotiations that may or may not be going on at present — not in public anyway. The minister indicated that in late May a meeting was proposed to be held with the federal minister. At this point, there seems to be no indication of that meeting. Can the minister indicate whether a May meeting has been established or not? MR.

LEITCH: No, Mr. Speaker, we have not established a date for the next meeting. I'm hopeful that such a date will be established in the near future. MR. R. SPEAKER: Mr. Speaker, a supplementary ques­ tion to the minister. In earlier remarks in the Legislature, the minister indicated that he would be in contact with the federal minister shortly after his return to Ottawa. Has that contact been made, and is a target date for a meeting being established? MR. LEITCH: Mr. Speaker, I haven't been in personal contact with Mr.

Lalonde since the April 13 meeting, but discussions have been going on between personnel from each of our offices. MR. R. SPEAKER: Mr. Speaker, a supplementary ques­ tion to the minister. Could the minister indicate whether this indecision and lack of communication, maybe on the part of both Alberta and Ottawa, is an indication that the energy negotiations have bogged down, and the results are slower than ever? MR. LEITCH: Well, Mr. Speaker, I accept none of the implications in the question of the hon. Leader of the Opposition.

The situation is pretty well as we'd anticipat­ ed it would be following the April 13 meeting, which was that there would be some discussions at approximately this time, regarding the time and place of the next meeting. Discussions are going on between representa­ tives of our respective offices, but we've not yet arrived at fixing a time or place for the next meeting. MR. R. SPEAKER: Mr. Speaker, a supplementary ques­ tion to the minister. Can the minister assure the Assembly that a meeting will be held at least in June of 1981? May is finished. Will there be a meeting in June? MR.

NOTLEY: They can't even agree on a meeting date. MR. LEITCH: Well, Mr. Speaker, to the extent that I have control over such matters, there will be a meeting in June. MR. R. SPEAKER: Mr. Speaker, a supplementary ques­ tion to the minister. The minister indicated in his remarks in Hansard that there's urgency to this meeting and he would do everything in the his power to set that meeting date. The minister has indicated now that he has made no contact with the counterpart in Ottawa. Will there be immediate contact by the minister to arrange for that meeting? MR. LEITCH: Mr.

Speaker, I am amused by the agita­ tion of the hon. Leader of the Opposition. DR. BUCK: Promises, promises. Get the show on the road. MR. LEITCH: I just said to him that there has been contact between our two offices. We are discussing the location and time of the next meeting. MR. R. SPEAKER: Mr. Speaker, a supplementary to the minister. Will the next meeting be in June, and is that the proposal of the provincial minister to the federal minister? As well, have discussions been held with the Esso Resources group as to problems they will have to confront or decisions that will have to be made in June? MR.

LEITCH: Mr. Speaker, there have been no recent discussions between me and representatives of the Esso group. As to the first part of the question of the Leader of the Opposition, I don't know that I can add anything to the earlier answers I've given. MR. NOTLEY: A supplementary question to the hon. minister. In view of reports attributed to the federal minister that he's not optimistic about an agreement for some time — I believe the end of the year — has there been any consideration of further discussion of a meeting between the Premier and the Prime Minister over the next period of time?

The minister has indicated he wants to have a meeting in June. What's the obstacle? Is it reluctance on the part of the federal minister to meet? Is it the logistics? What are the problems of arranging a meeting, when a few weeks ago we were advised that the end of May would be a reasonable target date? MR. LEITCH: Mr. Speaker, the hon. Member for Spirit River-Fairview refers to an obstacle about a meeting in June. I don't know where he draws the implication that there is an obstacle to that meeting. I was asked by the hon.

Leader of the Opposition whether I would assure the Assembly that a meeting would take place in June. Obviously I can't assure the Assembly that I'm going to meet with someone else during a particular time, simply because I don't have any control over what the other party to the meeting may want to do. I've said that as far as I was concerned, I was looking toward a meeting certainly no later than June. We've been discussing dates and possible places for a meeting and just haven't arrived at one yet. I don't regard those as obstacles. It's a matter of fitting schedules together.

I think that is the appropriate response to the first portion of the question of the Member for Spirit River-Fairview. MR. NOTLEY: Mr. Speaker, a supplementary question to the hon. minister. Obviously one meeting is hardly going to do it. In view of the problems, the obstacles that the minister has indicated in terms of fitting schedules together, what consideration is being given now to meet­ ing dates over the next period of time between the government of Alberta and the federal government?

Is the minister in a position to give the Assembly any indication of what the government of Alberta sees as a feasible time for an energy agreement?

May 21, 1981 ALBERTA HANSARD 851 MR. LEITCH: Mr. Speaker, there were about three questions to respond to I guess, including the earlier one with regard to a possible meeting between the Prime Minister and the Premier. Certainly I haven't been in­ volved in any discussions about such a meeting. At this time, Mr. Speaker, we wouldn't be considering future meeting dates or places. I think we can only consider that during the course of the next meeting. Because during that meeting we will have a better feel for the need for and the timing of any additional meetings. Mr.

Speaker, one further question was asked, and it has slipped my mind at the moment. Perhaps the hon. member could repeat it. MR. NOTLEY: Mr. Speaker, we've had some reports attributed to the federal minister of an agreement by the end of the year. Is the minister in a position to give the Assembly any indication at all as to whether the minis­ ter's impression is that an agreement can be reached by the end of this year? MR. LEITCH: Well, Mr. Speaker, there is certainly no way that I would want to give the Assembly any as­ surances as to when an agreement might or might not be reached.

Frankly, I don't know how you can do that. As we proceed with these meetings, we will only know whether an agreement will be reached and when it can be reached, if in fact we can come to an agreement. But to pick a time frame and say, this is when I anticipate we'll know that we can't reach an agreement or, this is when I anticipate we will be able to reach an agreement, is certainly something that couldn't be done. [Two members rose] MR. SPEAKER: A final supplementary by the hon. Leader of the Opposition, followed by a supplementary by the hon. Member for Edmonton Mill Woods. MR. R. SPEAKER: Mr.

Speaker, a supplementary ques­ tion to the minister. In light of the fact that June 1 is the second phase of the cutbacks and, secondly, that July 1 is the deadline date for Esso Resources, what are the ob­ stacles to an early meeting with the federal minister? Has the minister cleared his own timetable so that his

schedule is open from now till the end of June or whenever an agreement is signed, so that he is on call to the federal minister, if that's the person setting the meeting date? AN HON. MEMBER: Is that how you operate, Ray? [interjections] MR. R. SPEAKER: Mr. Speaker, the minister said the fault lies with the federal minister, that he is available for meetings. If what I said isn't accurate, then the minister had better correct it, because if the meeting date rests with the provincial minister, why isn't there a meeting? It's as simple as that.

This minister and government have promised to get the negotiations . . . MR. SPEAKER: Order please. MR. LEITCH: I'm always amused, Mr. Speaker, at the little speeches of the hon. Leader of the Opposition during question period. But I want to assure him that, unlike the previous government, we're not on call to any federal government. SOME HON. MEMBERS: Agreed. MR. LEITCH: And I want to give him a second as­ surance, Mr. Speaker, that my

schedule has been cleared, and I have been available and will remain available for a meeting. MR. R. SPEAKER: Mr. Speaker, if . . . MR. SPEAKER: Order please. A final supplementary by the hon. Member for Edmonton Mill Woods. If there's time, we can come back to this topic later in the question period. MR. PAHL: Thank you, Mr. Speaker. I wonder if the Minister of Energy and Natural Resources would confirm to the Assembly whether the second scheduled reduction in production will go ahead on June 1. MR. LEITCH: Yes, Mr. Speaker. Referendum Legislation MR. R. SPEAKER: Mr.

Speaker, I have a second ques­ tion, equally as important. To the Attorney General: the strategy of this government is never revealed. One of the Acts that was a strategy or whatever, was The Referendum Act of the previous Legislature. I'd like to ask the minister whether this Act, or a modification thereof, will be introduced in this spring session of the Legislature? MR. JOHNSTON: Mr. Speaker, I'll respond to the ques­ tion of the Leader of the Opposition. As I recall that was asked some time ago, and I said I would be introducing the Bill in the session. That includes the fall session.

I imagine it would more likely be the fall session. MR. R. SPEAKER: Mr. Speaker, a supplementary ques­ tion to the Minister of Federal and Intergovernmental Affairs. Would the minister indicate whether there will be a significant number of amendments in the legislation? Is that one of the reasons for the delay into the fall session? MR. JOHNSTON: Mr. Speaker, I can't, contemplate what amendments would take place. I will be introducing a Bill, however. MR. NOTLEY: A supplementary question to the hon. minister.

Is the minister at this stage contemplating the introduction of a Bill modelled on the rather poorly drafted Bill introduced in the fall session of the recent House? MR. JOHNSTON: Mr. Speaker, the Member for Spirit River-Fairview will just have to wait and see. MR. R. SPEAKER: Mr. Speaker, a supplementary ques­ tion to the minister. That's the normal answer we're getting out of this government. They'll answer tomorrow or next year. Why don't they know what they're doing? [interjections] MR. SPEAKER: Order please. MR. R. SPEAKER: Mr.

Speaker, if the minister is aware, able to make a decision, and give some direction, will one of the amendments possibly proposed for this

852 ALBERTA HANSARD May 21, 1981 legislation provide financial support for various groups that wish either to oppose or support a resolution that may come through a referendum? MR. JOHNSTON: It would not be my place to remind the Leader of the Opposition that this would be a ques­ tion which would be debated when the Assembly sees the legislation itself. I would only advise the Assembly, Mr. Speaker, that several options are open to this form of legislation. There are two principal items.

One would be the form in which the rules are formed and made, and how this Assembly has input into those rules, and of course there would be the second range of questions which would deal with the way in which the plebiscite itself would be conducted. Of a subset of the second item would be such questions as funding. I'm sure that when the legislation is brought back those will be fully and properly dealt with. I can assure the Leader of the Opposition that we'll provide leadership, as we have in the past. MR. NOTLEY: Mr. Speaker, a supplementary question to the Minister of Federal and Intergovernmental Affairs.

Given the experience of other jurisdictions, particularly the province of Quebec, including for that matter the Parliament in Great Britain, where legislative hearings by an all-party committee took place, is the government determined at this stage that the Bill will be strictly a product of the Conservative caucus, or is the government prepared to look at a referendum Bill which is drafted as a result of an all-party committee? DR. BUCK: Are you kidding? MR. JOHNSTON: Mr. Speaker, as I indicated several models are available.

If the Member for Spirit River- Fairview is giving me a recommendation, I'll take it as that. But I think it would be proper for the government to take the leadership once more and bring the legislation forward. We'll take that responsibility. MR. KNAAK: Mr. Speaker, a supplementary to the minister. There is a high likelihood that the federal government may not be successful in its unilateral moves with the constitutional amendment.

In the event that the eight premiers representing the majority of Canadians are successful in stopping this unilateral move, will the minis­ ter reconsider the need to introduce the referendum legislation? MR. SPEAKER: The hon. member's question is clearly hypothetical. Truck/Train Collision MR. HIEBERT: Mr. Speaker, my question is directed to the minister responsible for Disaster Services.

It emanates from an incident in southeast Edmonton this morning where, around 4:30 a.m., a number of citizens were aroused from their sleep with a series of explosions relat­ ed to a 45,000 litre tanker truck collision with a train on an uncontrolled intersection or crossing at the Edmonton-Strathcona boundary. Within minutes, I was at the scene of the accident. I noted a prime response from the Edmonton fire department. SOME HON. MEMBERS: Question, question. MR. HIEBERT: Mr. Speaker, the hon. Member for Clover Bar took my time with his amendments, and I'm just trying to indicate why . . . DR. BUCK: Mr.

Speaker, I would like to remind you the rules apply to both sides of the House. [interjections] The member is making a speech. MR. SPEAKER: Under the circumstances, with great respect to the hon. Member for Clover Bar, I have very much in mind the application of the rules to both sides of the House. Thus far, I would have difficulty in finding fault in the latitude shown by the hon. Member for Edmonton Gold Bar, as compared with latitude which has occurred in previous questions. DR. BUCK: We're not interested if he got up at 4:30 or 5 o'clock. MR. SPEAKER: Order please. AN HON.

MEMBER: It's just the pot calling the kettle black. MR. HIEBERT: Mr. Speaker, I know the member over there is very sensitive about the boundary situation. MR. COOK: Annex him. MR. HIEBERT: My question to the minister is: as a result of the Edmonton fire department, Edmonton city police responding, along with the county fire department, and having the potential of a Mississauga, could the minister clearly indicate to the House and the Edmon- tonians of that area, who is responsible for taking charge or command in that type of emergency and in that type of jurisdictional question? MR.

SPEAKER: With great respect, that would appear to be a question seeking a legal opinion. Unless it can be related in some way to government policy, it wouldn't be a question for the question period. MR. HIEBERT: Let me put the question another way, Mr. Speaker. Do we have a policy with regard to such a situation? MR. NOTLEY: We're waiting for Ottawa. MR. MOORE: Mr. Speaker, there clearly are some re­ sponsibilities when such accidents do occur.

Disaster Services, by the way, is there in the role of a co-ordinator, not necessarily on the scene, but having been involved previous to such occurences occurring, ensuring that each community has a disaster plan. In the particular instance the member cites, there is a responsibility on behalf of the police and the fire department, in whose jurisdiction it lies. Indeed the railways have a major responsibility in that regard, and as far as I'm concerned, generally are active and well prepared to deal with such emergencies. In addition to that, we often have a nearby MLA on the scene immediately. MR.

HIEBERT: A supplementary question, Mr. Speak­ er. In light of the debate yesterday on annexation, there was a concern about Edmonton's capacity to supply power and water to the heavy industrial area. I would like to know if the minister could assure that there is adequate

May 21, 1981 ALBERTA HANSARD 853 water supply to the heavy industry area located in Strath­ cona county, by the city of Edmonton? DR. BUCK: Why don't you ask the mayor? MR. SPEAKER: With great respect, might I suggest that the question be transferred to Edmonton city council. MR. PAHL: A supplementary question, Mr. Speaker. It is my understanding that the Alberta Disaster Services warehouse is located in the constituency of Edmonton Mill Woods adjacent, to both the refinery and other industrial areas of the city.

I wonder if the minister could advise whether that strategy was somehow put in jeop­ ardy because of the location of that accident at 39th Street and 92nd Avenue? MR. MOORE: Mr. Speaker, I'm not sure I've caught the import of the question. Perhaps I can be helped by a rephrasing of it. MR. PAHL: Mr. Speaker, my information indicates there was some danger to the Disaster Services warehouse and the ability of that warehouse to respond to an emergency. I wonder whether the strategy of locating that in Edmonton close to the refinery could be subject to some review. MR. MOORE: Indeed, Mr. Speaker.

I should say to the hon. member, however, that the resources of Disaster Services and the resources assembled throughout the province to respond to such emergencies are spread far and wide. Of course it is necessary to ensure that services of that nature are provided close to areas where there is a potential for such incidents to occur. But there are indeed other warehouses in the region that could well serve in the event that one of our locations of emergency equip­ ment might come into contact with such an incident. MR. PAHL: A supplementary, Mr. Speaker.

Including the crossing where the accident occurred, there are 14 level crossings within Mill Woods where refinery prod­ ucts move from the refinery past Gold Bar, Avonmore, and through Edmonton Mill Woods to destinations both south and west. I wonder if the minister could indicate whether there are contingency plans, in addition to Lambton Park warehouse, along those routes within the city of Edmonton. MR. MOORE: Mr.

Speaker, I have to take that question as notice and perhaps get some further clarification from the hon. member as to whether he means contingency plans by the city of Edmonton fire department or police department, Alberta Disaster Services, the Canadian Na­ tional Railway, or the CPR. I know a variety of contin­ gency plans exist for accidents of that nature. Perhaps the hon. member could outline to me from what area he's looking for those answers. Hazardous Chemical Spills MR. NOTLEY: Mr. Speaker, I'd like to direct this ques­ tion to the hon. Minister of Environment.

It concerns a matter brought to my attention by the McMurray Inde­ pendent Oil Workers Union concerning a transformer explosion and suspected PCB spill on March 4, 1981. Has the government received a report of this particular incident? MR. COOKSON: Mr. Speaker, I'm not sure [which] area the member referred to. In addition, I would have to refer to the department to see if the report has come in. MR. NOTLEY: Mr. Speaker, by way of explanation, it occurred on March 4 at the Suncor plant in Fort McMurray. Mr. Speaker, my supplementary question on this mat­ ter to the hon.

Minister responsible for Workers' Health, Safety and Compensation: is the minister in a position to advise the Assembly whether the department of occupa­ tional health and safety worked with the company in administering blood tests to workers at the site who were involved in clean-up of the spill? MR. DIACHUK: Mr. Speaker, I must share with my colleague the Minister of Environment. I would have to take that question on notice and respond more fully. I don't have before me any information on that incident, nor do I know if it has been reported to my officials. MR. NOTLEY: Mr.

Speaker, a supplementary question to the hon. minister. What is the policy of the govern­ ment with respect to notification — in this case where a spill has occurred — to the bargaining agent of the workers involved? The matter was brought to my atten­ tion today by the McMurray Independent Oil Workers Union. Apparently tests were conducted. When tests have been conducted, is it a policy of the department that the union representing the workers is advised? MR. DIACHUK: Mr.

Speaker, it's not only the policy; to my recollection it is in the statute that the worker who is examined must be advised of the results of the ex­ amination. With regard to the particular union, I'd have to check and advise the member more fully whether this is in the policy. MR. NOTLEY: Mr. Speaker, a supplementary question to the hon. minister. It flows from information brought to my attention by the bargaining agent in this incident. What test does the department of occupational health and safety use in this province with respect to suspected PCB contamination?

Is it a blood test, as was adminis­ tered to these workers, or is it the test consistent with standards of the national institute of occupational safety and health, which is more complex? MR. DIACHUK: Mr. Speaker, I would like to take that too on notice and respond more accurately and fully. MR. YOUNG: Mr. Speaker, if I may supplement the answer. I would point out to the hon. Member for Spirit River-Fairview that in his original question he asked what reports government receives. The electrical protec­ tion branch would receive a report if the explosion was of any consequence.

It is the practice and policy of that branch to follow up on all electrical incidents of this nature, to examine whether a pattern is developing over a period of time and whether there needs to be a review of any particular form of equipment. MR. NOTLEY: Mr. Speaker, a supplementary question to the hon. Minister of Labour. In view of the minister's answer and that I'm advised that two weeks after the incident on March 4 Kinetic Contaminants had a clean­ up crew on the site, what report has been filed with the Department of Labour at this time?

854 ALBERTA HANSARD May 21, 1981 MR. YOUNG: Mr. Speaker, I would have to check to determine that. I simply wanted to point out that it is the practice and responsibility of the electrical protection branch to follow up in case there are situations which could indicate that equipment needs to be examined. I know they watch very carefully for arcing in transform­ ers. I judge from the way the question was phrased that that's what occurred in this instance. MR. SPEAKER: Might this be the final supplementary on this. MR. NOTLEY: Mr. Speaker, a final supplementary question to the hon.

Minister responsible for Workers' Health, Safety and Compensation concerning the clean­ up of the spill. I'm told by the union that the original transformer is still in the cage and hasn't been removed yet. The concern expressed to me is that workers in the powerhouse are working in very close proximity to this transformer, which hasn't been moved. What kind of policy does the department have with respect to protec­ tion of workers working in an area where there has been a suspected PCB spill?

Are there any clear instructions to the company from the department of occupational health and safety, which would prohibit work in the immediate area without proper clothing? MR. DIACHUK: Mr. Speaker, The Occupational Health and Safety Act is quite explicit in that if the worker is aware or if it's brought to the worker's attention, it is the responsibility of the worker or workers not to enter an unsafe site. If that occurred in that incident, as the hon. member alludes, it will be part of the answer I'll provide when I check into what I took earlier as notice. Oil Workers' Overtime MR. WEISS: Thank you, Mr.

Speaker. My question is to the hon. Minister of Labour. In view of the recent issue pertaining to overtime between Suncor and McMurray Independent Oil Workers in Fort McMurray, I wonder if the minister would advise the Assembly if he's had any discussions with Mr. Don Marchand, the MIOW presi­ dent, and/or Suncor officials? MR. YOUNG: Yes, Mr. Speaker. I had at least one telephone conversation with Mr. Marchand, following advice from the hon. Member for Lac La Biche- McMurray of concerns expressed to him over the week­ end by members.

I can also advise the House that the situation was left that if there are outstanding concerns, Mr. Marchand should call me back. I haven't heard from him in the last 36 hours. MR. WEISS: A supplementary, Mr. Speaker. Has the Minister of Labour or his department ever approved any overtime previously in subsequent years? MR. YOUNG: Mr. Speaker, I believe I should divulge a few details of the situation at the Suncor plant in Fort McMurray. The operation we're discussing has many dif­ ferent parts: one is a mining operation and the other a refining operation.

The nature of the refining process is that the refinery has to be taken down, serviced, and goes through what is called a turnaround. This occurs about every two years. In 1979 and 1977 when that occurred, Suncor asked the Department of Labour for permission to work six consecutive days at 10 hours per day. At that time, employees made representation through their union to work five days at 12 hours per day. The work sched­ ules were followed, as approved, at six days per week, 10 hours per day, for the short term of taking the plant down, out of production. The reason is that it becomes a question of safety.

In the particular instance that occurred just recently, with respect to the process part of the operation, which is a 24-hour a day operation, when it was determined that the plant had to be taken down for turnaround on a somewhat emergent basis because of problems with the flare stack, the company determined that the safe way to do it, in the interests of the health of the workers and the safety of the plant, because it does involve gases, et cetera, was to double team or have two employees in the process area rather than one as in a normal working situation.

They requested the employees to work six days, 10 hours per day. Some of the employees did; others did not. The result was that there was some disciplining of, I believe, four employees, who did not consider that they should respond, in the interests of safety and the urgency of the situation. Mr. Speaker, much has been said about the legislation. The former statute provided for an urgent situation for the employer to require employees to work longer hours, and the situation is no different today. MR. NOTLEY: Mr. Speaker, a supplementary question for clarification . . . MR. SPEAKER: Possibly the hon.

Member for Lac La Biche-McMurray might pursue the main question and then a supplementary. MR. WEISS: Thank you, Mr. Speaker. A final supple­ mentary. What is the overtime situation now, and were some 1,000 employees ordered back to work overtime? MR. YOUNG: No, Mr. Speaker. In terms of process, the overtime involves a rather small crew of, I believe, approximately 18 persons at any one time. In the turna­ round, in examining the jobs it was felt were critical and should have two persons attending them, I believe that was reduced from 18 to about 10.

In terms of a take­ down of the operation, the turnaround was completed in about six days. At that time the process operations went back to a five-day, eight hour schedule. They will not be going back to an extended hours situation until the re­ finery is ready for start-up. I'm advised by the company officers that when that occurs, they will be requesting, in the interests of the safety of the men on the site and the safety of the plant, that again these certain positions be double manned for about six days, and that will necessit­ ate some overtime. Kinbrook Island Provincial Park MR. MANDEVILLE: Mr.

Speaker, my question is to the hon. Minister of Recreation and Parks. Have any officials from the minister's office had recent meetings with Eastern Irrigation District officials with regard to the high water level in Lake Newell and the effect it's having on cabins in Kinbrook Island Park? MR. TRYNCHY: No, Mr. Speaker. As far as I know, I don't think we have.

May 21, 1981 ALBERTA HANSARD 855 MR. MANDEVILLE: A supplementary question, Mr. Speaker. Is it the intent of the government or the parks department to purchase more cabins at Kinbrook park? MR. TRYNCHY: Mr. Speaker, it's hard to say whether we will continue the policy of removing cabins, but that will be taken up with the advisory board now being appointed at Kinbrook Island. I'd have to check that question and advise the member later. MR. MANDEVILLE: One further supplementary ques­ tion, Mr. Speaker.

Could the minister indicate whether they're going to continue to provide overnight camping at Kinbrook park, or are they eventually going to use it for day use? MR. TRYNCHY: Mr. Speaker, as we're all well aware, some few months ago I was at Kinbrook Island, and we set up an advisory committee of local people. I hope they would meet and make some recommendations to us, and we would follow their recommendations as best we can. My understanding is that we will have it as overnight camping for now, and if we expand to another area, we would make it into a day-use area.

We're working with the committee and, hopefully, their recommendations are the ones we would follow, if they fit park policy. MR. MANDEVILLE: One final supplementary question, Mr. Speaker. Has the minister had any contact with the Eastern Irrigation District with regard to purchasing more land for overnight camping at Kinbrook Island Park? MR. TRYNCHY: No, Mr. Speaker, personally I haven't been involved. Signal Flares DR. BUCK: Mr. Speaker, I'd like to ask a question of the Minister of Transportation. This has to do with signal flares and flags on vehicles. Just a brief background for the minister.

In the case of vehicles abandoned because of mechanical failure — in this one instance, the vehicle was abandoned; a vehicle tail-ended it, ricocheted across the road, and nearly hit an oncoming vehicle. Is the minister in a position to indicate to the Assembly what the dif­ ferentiation is between which vehicles must carry flares and which are not required to carry flares? MR. KROEGER: Mr. Speaker, I don't know that there's a differentiation if we're talking about trucks specifically. The requirement for flares is there for all trucks, but it hasn't been actively pursued.

Recently there has been no change in the way the traffic Act reads. Because of the implications of a commercial unit, even though it's the same sized unit, perhaps tending to carry tools, having wider bodies — not exceeding width but having wider bodies than a standard half-ton truck, for example — the insistence is that commercial units have to have flares. DR. BUCK: Mr.

Speaker, then can the minister indicate to the Assembly the reasoning, or is it a reason or just a misapprehension that half tons having commercial plates must carry flares but half tons not having commercial plates are not required to carry flares? Is this just a misconception in the minds of the public, or is this a fact, Mr. Minister? MR. KROEGER: To make sure, I want to check, Mr. Speaker. I don't think there's any difference in the Act. I think the Act covers all units. That's what I meant earlier.

I suppose in the enforcement of it — and perhaps the Solicitor General want to comment — the emphasis has been on commercial units. DR. BUCK: Mr. Speaker, is the minister in a position to indicate if he or the Solicitor General is considering all vehicles being required to carry flares. You're just as dead if you run into the back of a car and ricochet into the oncoming lane, as you do into a half ton or truck. Is the government considering that approach? MR. KROEGER: No, Mr. Speaker. We haven't dis­ cussed, this, but I think it's a subject worth pursuing. Emergency Utility Restoration MR. PAHL: Mr.

Speaker, my question is to the Minister of Utilities and Telephones. It relates to the collision and fire at the boundary of Edmonton Mill Woods and the county of Strathcona. My understanding is that there were power and telephone outages in the city and the county of Strathcona, and these outages were repaired by Edmonton Telephones and Edmonton Power. Would the minister advise the Assembly whether there's a policy by his department requiring the utilities involved to restore power to those areas that might be deemed to require it first, in this case, perhaps a residen­ tial area? MR. SHABEN: Mr.

Speaker, as the hon. member knows, there are a variety of utilities within the province, including municipally owned utilities, rural electrification associations, and investor-owned utilities in those cities that distribute power that they purchase wholesale. With­ in each utility they establish their priorities and policies, and generally those policies reflect the view put forward by the Member for Edmonton Mill Woods, that resi­ dences are dealt with quickly.

They have a variety of emergency programs where persons who are highly de­ pendent on power are registered with the utility company, and arrangements can be made to supply that power or provide alternative methods of making energy available to them. MR. SPEAKER: The hon. Associate Minister of Public Lands and Wildlife would like to deal further with a topic raised previously. Odyssey Project MR. MILLER: Thank you very much, Mr. Speaker. I notice that the hon. Member for Olds-Didsbury is not in his place today. However, I would like to respond to some questions he has asked on two different occasions.

On May 13 part of the question he asked was: "Is the minister prepared to make available copies of the condi­ tions attached to the conditional approval" of the Odys­ sey project? At this time I would like to file four copies of those conditions with the Legislature Library. Furthermore, Mr. Speaker, if I might respond to some of the questions he asked yesterday. One was: Is the minister in a position to indicate to the Assembly what conditions there are in the agreement that will guarantee that a hotel strip or a new town won't be developed in the area adjacent to where the

856 ALBERTA HANSARD May 21, 1981 Odyssey project is being developed? Mr. Speaker, I would refer members to the Eastern Slopes policy, which is the guidelines under which the Odyssey proposal is being developed, and indicate to the Assembly that the Odyssey development is located 35 miles west of Nordegg on Highway No. 11, about 8 miles from the Kootenay Plains. It is located within the general recreation zone, which is covered by our Eastern Slopes policy, and residential development is not allowed in the recreation zone. We would not entertain any form of population centre in the vicinity of Odyssey.

This is controlled by refusing to issue any permits or leases for residential development. I should also point out that between the Odyssey development and Nordegg there is a small facility zone area in which a motel development is presently located. The department is presently working with the developers to see if staff cannot be accommodated in Nordegg. It is expected that only a small number of essential staff will be accommodated within the development.

The second question was: Can the minister assure the Assembly that in fact in the conditions granted to the Odyssey project people there is a condition which will protect against the development of a population centre in the area adja­ cent to the project? I have partially answered that. However, Mr. Speaker, I should point out that the lease that was granted was subject to five conditions.

Number one states that: "The lessee shall, before commencing any development, submit for approval, all development plans and specifications for improvements." Further, only a bare minimum of essen­ tial staff will be allowed to live on the site, and their accommodation would be part of the tourist facilities. No significant staff accommodation facilities will be allowed on the site. As well, under no circumstances would the department approve any leases adjacent to the Odyssey site which might lead to the development of a village, hamlet, or community in the area. Finally, Mr.

Speaker, the Alberta Forest Service has identified an existing in­ dustrial campsite at the Bighorn dam, which was used for the construction of the dam. This site could be utilized for the construction staff who will be working on the Odyssey project. Thank you, Mr. Speaker. ORDERS OF THE DAY MR. SPEAKER: May the hon. Member for Barrhead revert to Introduction of Special Guests? HON. MEMBERS: Agreed. head: INTRODUCTION OF SPECIAL GUESTS (reversion) MR. KOWALSKI: Thank you very much, Mr. Speaker.

For the fifth time this week it gives me great pleasure to introduce to you and to members of the Assembly a group of bright, young scholars from Littleport school, located in the hamlet of Tiger Lily, which is 12 miles west of Barrhead. The 10 students in the members gallery are accompanied by a very competent teacher, who formerly spent time working in this building and is now a very good friend and confidante of mine, Mr. David Bouyea, and by their bus driver the Rev. Dan Dressier, pastor of the Barrhead Church of God. I ask the scholars, Mr. Bouyea, and Rev.

Dressier to stand and receive the recognition of the House. head: WRITTEN QUESTIONS MR. HORSMAN: Mr. Speaker, I move that questions 133 and 134 stand on the Order Paper. [Motion carried] head: MOTIONS FOR RETURNS 125A. Dr. Buck moved that an order of the Assembly do issue for a return showing the estimated total cost of comple­ tion of every capital project proposed in the 1981-82 budgetary estimates where funding will be required to complete the project in subsequent fiscal years and where the proposed 1981-82 appropriation for the capital project exceeds $200,000. DR. BUCK: Mr.

Speaker, I believe the minister has amendments to make to 125 and 126. MR. CHAMBERS: Mr. Speaker, perhaps I could cover both at the same time. The amendment to 125A would add "other than for the Department of Hospitals and Medical Care" at the beginning of the motion, and that "$200,000" be changed to "$1 million". Perhaps I'd better stop there. [Motion as amended carried] 126. Dr.

Buck moved that an order of the Assembly do issue for a return showing both the original estimated total cost and the current estimated total cost to completion of every capital project administered under the budget of the Department of Housing and Public Works where the proposed 1981-82 appropriation for the capital project exceeds $200,000. DR. BUCK: The same thing applies here. The minister has an amendment to make. MR. CHAMBERS: Mr.

Speaker, the amendment to 126 would delete "both the original estimated total cost and the current", and further that "$200,000" be changed to "$1 million". [Motion as amended carried] 131. Mr. Notley moved that an order of the Assembly do issue for a return showing any reports compiled by the De­ partment of Environment since January 1, 1974, concern­ ing PCB spills at the Procter & Gamble paper mill in Grande Prairie, including results of any monitoring of PCB content in the Wapiti River and in fish in that river. MR.

NOTLEY: I should just point out that we already have the Department of Environment monitoring study on the 1978 spill, Mr. Speaker. I gather that the minister has an amendment to make. MR. COOKSON: In accepting Motion for a Return 131, Mr. Speaker, I would like to have the Assembly delete

May 21, 1981 ALBERTA HANSARD 857 "including" and replace it by "and". I ask for this change because it very well may be that in reading it originally, unless the two reports were combined into one, it would exempt a separate report. So it really broadens the request. [Motion as amended carried] 132. Mr. Notley moved that an order of the Assembly do issue for a return showing a list of all hazardous chemical spills reported to the Department of Environment in 1974, 1975, 1976, 1977, 1978, 1979, and 1980. MR. COOKSON: Again, Mr. Speaker, I'm prepared to accept the motion.

I just want to put on the caveat that when you go back to 1974 there may not be any reports, but we'll certainly make available any information we have. [Motion carried] head: MOTIONS OTHER THAN GOVERNMENT MOTIONS 217. Moved by Mr. Mandeville:

Be it resolved that this Assembly urge the government to accept responsibility to provide additional protection for Albertans from intolerably high interest rates so that Albertans can continue to afford housing, farmers can continue to farm, and businessmen can continue to con­ duct business. MR. MANDEVILLE: Mr. Speaker, I think it's one of the most serious areas we're facing today. For the last nine weeks in a row, the Bank of Canada interest rate has increased. Today it went up to 19.06.

Something has to happen or bankruptcies are going to be looking at us, and we're certainly going to have problems in this area. Inter­ est rates are going to have an effect on everybody in Canada. I'm really concerned that they're going to break the economy without controlling inflation if they con­ tinue increasing at the pace they're going. There's no way I can agree that we're going to control inflation by in­ creasing interest rates to the height where the consumer just can't accept them. We're fuelling inflation by increas­ ing interest rates and getting them out of line.

Our belief is that we have to control credit if we're going to control inflation. For example, if one is going to go out and purchase something, I think we should put a certain percentage down before we are able to purchase automo­ biles, snowmobiles, and such. Recently we have heard so much on the constitution and the energy policy. I think they are serious as well. But if we don't do something to control our high interest rates or to protect Albertans, maybe the constitution and the energy policy aren't going to be that serious.

I certainly think interest rates are just as serious as either the consti­ tution or the energy policy. Possibly we're going to iron out the constitution and the energy policy as well. But if we don't get to doing something about interest rates, we're going to go back to the 1930s. I can see them coming, Mr. Speaker. I can see it very serious. I agree interest rates are not an Alberta problem. They're a federal problem. The federal government is trying to keep up with the Americans, the U.S. interest rates.

I would say let them divorce themselves and stay across the line, and let us control our interest rates here in Canada ourselves. Our federal government is saying, well, we have to bolster the Canadian dollar. Mr. Speaker, I agree that the Canadian dollar is depressed; it's down around 83 cents. But maybe we shouldn't be so concerned about the depressed Canadian dollar. Canada is an ex­ port nation, and if the dollar is depressed it's not going to hurt us that seriously over a short period of time. I certainly don't think we should be looking at all at increasing interest rates to stabilize our dollar.

I do think Alberta definitely has a role to play at the present time as far as our interest rate situation is concerned. I look at the consumer report that just came out, indicating bankruptcies over the past few years. Bank­ ruptcies rose 17.5 per cent in Canada last year,

whereas in Alberta they rose 26 per cent. Why? Because we're a productive province, and that's what interest rates are hurting — a province like Alberta that is productive. I see here that the bankruptcy figures have been increasing consistently. But that's not going to stop there. I look at another report that just came out. In March 1981, bank­ ruptcies in Canada were 25 per cent higher than they were in the comparable month a year ago. They're going to get worse than that. At that rate it's going to create a panic amongst Canadians.

I can see our investors pulling right out of the market and a panic beginning, and going back to the 1930s. Who are interest rates going to hurt, Mr. Speaker? Just about everyone in Canada. But what amazes me is that almost always it's the middle-income people who are hurt the worst, who get the impact and are affected the most as far as any of these policies are concerned. Certainly interest rates are going to hurt the middle-income people as well as the low-income people and big business. The ones who are going to get hurt as well are the small lenders.

Some of our mortgage and small lending compa­ nies have loaned out money at a low rate of interest, and they're going to be finding themselves in problems now that term deposits get 15, 16, and 16.5 per cent. So it's certainly going to hurt small lenders, small business, and small farmers. Some of our people in the low-income bracket are going to be able to work their way out, because at the present time they have subsidized interest rates. Who is going to control the monetary system? The people who have the dollars. Dollars are the best invest­ ment you can have today. What else can you invest in?

I try to invest in cattle. I sure can't invest in the cattle industry or any business and have it as profitable as if one had his money in term deposit in the bank. So who is going to have control when it's all over, if interest rates stay like they are? It's going to be the banks; it's going to be the lending agents. They're going to have control. Purchasing power is going to be lifted from the hands of consumers after it's all over. I'd like to put some examples before the House. I'll start with our small oil and gas producers.

When the 8 per cent of net revenue went on, I have to agree it was certainly a deterrent to their operations. However, it wasn't as serious as the interest rates. Interest rates are certainly hurting our small, private gas and oil companies in western Canada, especially in Alberta. I know that many of these small companies have wells capped. Sever­ al years ago, when these wells were capped and they were not able to market them, they borrowed money. I have a chart here on what they were paying, say, in 1976. The bank rate was 9.29 per cent in 1976. Where is it at today? It's 19.06.

Some of these small oil companies I have mentioned borrowed money back in 1976 at 9.76 per

858 ALBERTA HANSARD May 21, 1981 cent. What are they paying for that same money today, with their wells capped? They're paying 20 per cent, 21 per cent. If you don't think that hurts, you'd have to be in the oil industry to really appreciate it. The cutback we have in this province is certainly not going to help these small companies because, especially in gas, we have a surplus now. The cutback is certainly not going to help these small oil and gas producers in any area. I was really pleased that the depletion allowance part of the budget was abolished. Who was getting all the depletion allowance on tax credits?

It was the major oil companies. The small companies I'm speaking of never got any of the depletion allowance, so they were hurt there. So the small oil and gas producers in Alberta have certainly had their drawbacks. It's the same old story, Mr. Speaker. The big companies — we can look at Cities Service and Gulf: they borrowed several million dollars from the province at 8.5 per cent. Hydro Quebec bor­ rowed $300 million at a preferred interest rate.

I think we have to start looking at providing some assistance to some of these small companies, through the opportunity company, and cover them as far as interest rates are concerned. Let's not forget about our small business men and small producers. Another example is agriculture. Agriculture is certainly going to get hurt as a result of interest rates. We do have the direct loan program. Looking at the report of the direct loan program, we have 4,482 direct loans and 621 guaranteed loans. Well the direct loans are good, and are working out well.

But the guaranteed loans are certainly having a problem, and it's a small percentage of the farmers in Alberta. Statistics Canada, February 6, 1981: we had 58,500 farmers in the province of Alberta, and 4,489 were on direct loans. We have to expand the ADC program and help these farmers who are on guaranteed loans. They face exactly the same problem the small oil and gas producers are facing. They borrowed money back in '76, or whenever, at 9 and 10 per cent, and now they're paying 20 and 30 per cent.

Don't tell me that some of them are not going to go bankrupt, because I know they will when they have to service that type of interest rate and debt. They're certainly going to have some problems: I would like to see us take these guaranteed loans and transfer them into direct loans in many cases where the farmers are facing real problems. If not, we're certainly going to see that this 29 per cent increase is going to be a lot more than that in the future. We're talking the world price as far as gas and oil are concerned.

But when gas and oil go to world price, or even 75 per cent as recommended by this government, we're going to put oil and gas out of reach, especially to our farmers in this province who are using lots of oil and gas. It's not only the farmers, it's all our consumers. As far as putting our oil and gas up to world price in Canada is concerned, I think we've got to put some type of shielding program in place for all Albertans. One of the areas that's really getting hurt at present is the cattle situation. I can express my views become I'm in the business.

In many cases, cattle feeders are losing from $100 to $150 a head. With this high interest rate, it's just impossible to feed cattle. It's been the same for the last two years. Where's the end going to come? What's happening right now is that cattle prices are dropping. Why are they dropping? They're not dropping on account of short supply; they're dropping because of high interest rates. People don't want to put cattle out on grass; they want to put them in the feed lot, sell them, and put their money on term deposit. That's what's happening to our cattle prices right now.

What's going to happen for the few ranchers who can hang on? Our tonnage is down because we're marketing light cattle. I was talking to one of the packers today. They're starting to move heavy cattle across the line today. What's going to happen with slaughtering light cattle in Canada? We're going to have a short supply of cattle down the road, and the consumer's going to pay for it. And a lot of ranchers are not going to be able to hang on. They've been able to hang on at present, because they've got a capital gain on their ranch.

They've been able to go into the banks and borrow some money as a result of the capital gain they've had on their land. However, that capital gain is no good unless you can have the cash flow to go along with it. That's what's happening to some of our cattle ranchers in the province today. Home mortgages are another area that I think we're going to have to take a really good look at. Because before the interest rates started, mortgages started escalat­ ing. It was really hard for one to qualify for a mortgage, because the income wasn't high enough.

Well what's it going to be like if this interest rate keeps climbing? Some of the analysts tell me that it's going up to 24 or 25 per cent. Who's going to be able to qualify for a mortgage? What about the poor individual who's already bought a house, has to renew his mortgage, and can't afford his payments? Here again, I think all we're doing when we increase this is putting fuel on the fire. If you increase the mortgage, your house payment goes up $400 or $500 a month, or whatever, and you've got to have more money. There's got to be more money available.

So the interest rate certainly isn't controlling inflation as far as we're concerned. I agree that many of our house purchasers are people who bought houses in the past. They have a capital gain. Here again, that capital gain is no good to you unless you can dissolve it into cash. How many couples are going to be able to meet their mortgage payments after these inter­ est rates escalate any more, or even at the rate they are today? And there are many more. There are just dozens of business in the same position. Mr. Speaker, how do you control inflation?

I certainly hope we don't control inflation by breaking the economy. Inflation's not going to be a factor after we break the economy. As I said, we have to start controlling credit. I think we have to start right here in the province, as far as getting a number of programs is concerned. I don't think we need all the programs. We need something to help people who are in trouble, not as a result of poor management but of high interest rates. The largest con­ tributors to inflation are all levels of government. We have to take responsibility. Look at the Canadian gov­ ernment.

They handle 40 per cent of the gross national product. They spend 40 per cent. That's the government. What have they got? This year they have a deficit of $13.7 billion. As individuals and businessmen, we've got to pay interest on our own business. On top of that we have to turn around and pay interest on the debt the federal government is accumulating. MRS. CRIPPS: [Inaudible] . . . cents out of every tax dollar. MR. MANDEVILLE: That's right. It's a pretty small tax dollar. I agree. As far as the provincial government is concerned, we've increased our spending 22 per cent. I think we have to

May 21, 1981 ALBERTA HANSARD 859 take a good look at that. Many of our municipalities and counties have increased their taxes 25 or 50 per cent. So a lot of the inflation factor lies within the governments themselves. I just can't see how we can service our own debt without servicing debt that has been accumulated by government. Mr. Speaker, no one can tell me that just because interest rates are high, you've got to start borrowing money. I'm in the cattle business. I can't just quit because I'm losing some money. I have to continue putting money in there.

If you're in a clothing business, what are you going to do? You're going to keep borrowing money and keep your inventory up, but you're going to reflect it back down to the consumer. In the end, the consumer is going to pay for it. People are still going to borrow money whether or not interest rates are high, because you have to to stay in business. I can recall in the 1950s when I used to buy my light deliveries — I could never afford a car. I'd buy a light delivery, go to the finance company, and finance it. What would I pay? Twelve, 13, or 14 per cent. That's back when interest rates were 5 and 6 per cent.

I thought, just so long as I can make that payment, the interest rate isn't all that significant to me. So long as I could make that $182 a month payment, that's what I was concerned about. I think there's the same attitude today. Credit is a way of life in the world. With interest charges at 20 per cent, it's not going to be a way of life for many people. They're going to be on social programs. In conclusion, Mr. Speaker, I think we have to prevent what's happening as far as interest rates are concerned. The questions have been in the House the last week or ten days.

The Provincial Treasurer says he's monitoring in­ terest rates; the Department of Agriculture is monitoring interest rates. But that's not good enough. It's not good enough to continue to monitor them. We've got to do something about them. If interest rates are more than 2 per cent above inflation, we're going to have problems. We have to keep them in line with our inflation rates. I'm not saying we should expand any programs. I think we should delete some programs. But some of the people who are in trouble; for example, ADC — let's get in there and help people on guaranteed loans.

Let's help some of the people who are renewing mortgages. Let's give them some assistance where they're in trouble. After all, we put $1.2 billion into other provinces to help them overcome some of their problems. I'm sure they had deficits they had to pick up, and came to Alberta to borrow money. So let's put some of this money into Alberta. Let's invest in Alberta while we have some money. Because some day somewhere down the line, maybe we're not going to have any money to invest. I'm getting a bit dubious now that we're getting too much money invested.

We don't have enough money available to go out and help our people in these types of programs. Mr. Speaker, I would like to get some support for this motion, and I think it's something the government has to take a good look at, before we break the economy of Canada and Alberta. DR. PAPROSKI: Thank you, Mr. Speaker. This motion is very timely, considering the high interest rates. It's very similar to Motion 206 from the hon. Member for Dray­ ton Valley, that was debated the other day and not concluded — I intended to speak on it:

Be it resolved that this Legislative Assembly recom­ mend to the government of Alberta that representa­ tion be made to urge the federal government to change its harmful economic, energy, and interest rate policies . . . . Mr. Speaker, reading the motion of the hon. Member for Bow Valley, frankly I was initially disappointed be­ cause I thought he implied the provincial government. With the comments he's made today, I think it's clear that he's zeroing in and rifling in on the federal government for their responsibility in that regard.

Clearly the Alberta government has taken the responsibility to provide addi­ tional measures for additional protection from high inter­ est rates for Albertans across the board, regarding hous­ ing, farming, and business in general. The government has already gone so much further than any other prov­ ince, or the federal government, that in fact there's no comparison. I know that the hon. Member for Bow Valley would agree with that. It's certainly not true that the provincial government hasn't taken steps to cushion and help the citizens of Alberta. I know that the hon.

Member for Bow Valley did not mean to point the finger at the provincial government exclusively, but I'll agree that all govern­ ments are responsible to some extent. Frankly, Mr. Speaker, the hon. member in all sincerity brought this motion with good intentions. He articulated the problem, as has been done so often. The problem is here. We are all aware of it — very sensitive — but the solutions are extremely difficult. He indicated that he would control credit. Mr. Speaker, that is the Bank of Canada solution — controlling credit by high interest rates — and it's far from being a solution.

I agree with him that one of the major problems of inflation in all countries of the western world is governments. But more important than just spending is deficit financing, and the hon. Member for Bow Valley indicated that in an oblique way. He indicated that he would delete some programs. I'm sorry he didn't say what programs he would delete. Having said that, Mr. Speaker, measures have been taken by the Alberta government to shelter our citizens in a way unprecedented in the history of any province in Canada.

It's precisely one of the reasons we're having so many problems with the federal government and other prov­ inces. The federal government says it's not equitable that we have so much in Alberta, even if it's non-renewable resources that have brought our new-found wealth for a period of time. The feds say, it's out of balance. The federal government says we must share with other prov­ inces. What does the Ontario government say? I repeat, "the Ontario government", not the Ontario citizens. Es­ sentially they echo the comments of the federal govern­ ment.

The hon. members knows, as I'm sure other hon. members know, that they are looking at us very, very carefully. If we bring in any further measures, I really wonder what would happen. [Mr. Appleby in the Chair] So as I rise to speak on this motion, in essence I'm speaking on the motion we talked about the other day.

Because we are actually making representation and should continue to make representation, and maybe bring other reforms to counter the harmful federal economic, energy, and interest rate policies so that farming, business in general, and the individual and family in Alberta can continue to exist and grow as they should. Mr. Speaker, it's a motion which in fact has been carried out; that is, making representation to the federal government. It is being carried out. Today we've heard that the hon. Minis­ ter of Energy and Natural Resources is available, and has

860 ALBERTA HANSARD May 21, 1981 cleaned his slate ready to deal with the federal govern­ ment at a minute's call. Of course I would be happier to see that the other motion indicated also that we continue with vigor. In fact it was implied. In either case the motion is very timely, in view of the actions of the federal government in Ottawa. What have they done? They've disregarded the wishes of the majority of provinces regarding the constitution. Mr. Speaker, the constitution has caused uncertainty, an unrest with busi­ ness in general.

They have disregarded the rights of the provinces specifically regarding ownership of energy. One of our greatest strengths in Canada is energy, and they have caused uncertainly there. They have disregarded the impact of causing such uncertainty by hurting industry, small business, big business. Big business spills over into small business and vice versa, because there is a multiplier effect, on business in general and farming also. Obviously they have disregarded high interest rates.

They don't recognize the fact that individuals, families, small businesses, farmers, and home-owners literally can­ not tolerate that high interest rate. What have they done in Ottawa? What do they say, Mr. Speaker? They just say, well, this is the policy. We know who's been in the federal government for the past 10 or 12 years. As a matter of fact, over the past 35 years, except for two occasions when the Conservatives were in government for a short period of time, it's been the Liberal government.

If we in Alberta are to continue to make representation to the federal government regarding these harmful, insensi­ tive, bungling activities of the federal government regard­ ing economy, energy, interest rates — and specifically regarding the national energy policy and the constitution — we must ask ourselves what else we can say that we have not said already. Let me cover the areas, Mr. Speaker. Let's talk about high interest rates for a minute — a very timely topic. In Canada at this time, we have the highest interest rates ever, 19.06, and that is prime.

As we all know, when a person borrows money it's prime plus 2, 3, or 4 per cent. So it's a lot higher than that. We have unprecedented unemployment, not in Alberta but in Canada. We have regional disparity like we've never seen before. We have a very high federal deficit, some $14 billion. Mr. Speaker, through the Hospitals and Medical Care and Transporta­ tion estimates, we've passed over $2 billion through this House during an evening. Just to get a perspective, because I'm sure all of us forget what a billion dollars means, it's throwing $1 every second for 30 years.

So $2 billion would take that throwing $1 every second for 60 years. That's what we've done. Then we talk about a federal government deficit of $14 billion. The problem is not merely a deficit, Mr. Speaker, but deficit financing. We do not — I repeat, we do not — have to follow the United States' interest rate as we're doing. Simply put, the Bank of Canada is doing what the federal government has directed it to do. They have no sensitivity at all, in spite of the fact that the profit of the federal government's first quarter earnings is 60 per cent higher than the first quarter last year.

Actually in the past two quarters the earnings of Canadian banks have been higher than ever before. Mr. Speaker, it's very difficult for the individual, family, or small business man to understand that. They're making a 60 per cent higher profit than the same time last year, and people are losing their businesses, going bankrupt, farmers are suffering, and home-owners are in jeopardy. Of course in addition to that, as I've said, we have unemployment, regional disparity, federal deficit, and high inflation. That high inflation also has been unprecedented at the 10 or 12 per cent level.

Yet in spite of this, that federal policy con­ tinues and the circumstances causing those harms are not being changed. They're thinking about it. Day after day in the federal House, the federal Conservatives have been asking the question and recommending and suggesting — and they're considering it. Well, by anyone's standards we know how difficult it is to maintain a mortgaged home with those high interest rates, especially if you have to remortgage. What happens to the individual and family? The facts speak for them­ selves.

The individual and family, the small business men, who are the pillars of our society, frankly reject this economic circumstance. The fact that they do — we as a government have a responsibility to continue to press, and we have an obligation to press all those who are responsible. Yes, even the provincial government is re­ sponsible to an extent. The argument will continue, Mr. Speaker, that there are international forces out there that we have no control over. We've heard that from everybody.

There are inter­ national forces, but we have a responsibility to face the reality that we as a country, or a province, if you wish, are able to do something from within. I'm going to suggest some of those items later in my remarks, if I have enough time. Alberta can do only so much on the short- term basis, considering our non-renewable resources which are depleting very rapidly. When we hear another province like Ontario bringing down a budget where taxes are higher, and we haven't raised our taxes and yet our budget has gone higher, we have to really take note of the relative position we're in, in Alberta.

So what does the federal government do while this unprecedented high interest rate continues? They cause small business to go out of business. They cause farmers to suffer. They pay less and less attention to the effect they have on those interest rates. They continue to cause constitutional upheaval and energy disruption, economic uncertainty, and persist with federal deficit spending like never before. Let me just give an example of what I mean by persistence of federal deficit spending, Mr. Speaker. It's not the ordinary spending. We know that senior citi­ zens' and veterans' allowances have to continue.

But we're talking about buying Petrofina — $1.5 billion. To do what? To do something that free enterprise was already doing, at a time when we as a country can ill-afford to do that. What are the solutions, Mr. Speaker? I'd like to be as definitive as possible: they're not the ultimate solutions; they're short-term. Long-term solutions take a lot of time to resolve a problem. Number one, we should announce that new gas exports to the United States. This would keep our trade deficit down, increase incentives to small business and explorers, increase inflow of capital, and offset the trade deficit federally.

Number two, frankly I just can't buy that the Bank of Canada or the Canadian banks should make such a high profit at this time. I for one am not in favor of wage and price controls. But at this time in our society, when the individual and family, people who have homes with high mortgages and have to renew them, small businesses and farmers — somehow it just isn't right. It's almost immoral that they should make a profit from individuals during this very, very difficult time. Mr. Speaker, the federal government should remove the wellhead tax.

It would increase exploration activity, and then we'd have the 20 times multiplier effect. In my opinion we should drop interest rates, even for a short

May 21,1981 ALBERTA HANSARD 861 period of time. Without articulating that completely, I know it would change the Canadian dollar in either case, and there is a risk with that. Maybe that shouldn't be done. But some measure will have to be taken if interest rates persist and those other measures do not help. We should cushion select groups by tax deduction on mort­ gages. Mr. Speaker, the federal Progressive Conservative Party advocated that.

That action will surely help the individual and family with mortgages, stimulate housing construction, and keep the individual and family at home, where they in fact want to and indeed deserve to be. If the Canadian dollar did float — and a 1 per cent drop in the Canadian dollar is said to increase the cost of living by 0.4 per cent. Maybe we have to take that risk. But we will produce more, we'll have to be more competitive, and employment will increase. If inflation continues to be an issue, let's have the federal government stop spending so much. Petrofina was an example. That's a key point, Mr. Speaker.

The hon. Member for Bow Valley suggested that. But this has to be not only in the federal government, which at 40 per cent is of course the greatest spender of the gross national product, but provincially, municipally, and in schools and hospitals. But to what degree? What programs should be cut off? It's a difficult decision, as we all know. But if there is deficit spending and we have a deficit without ability to repay it — in a deficit budget, that is — then I'm sure we're going to get into trouble, and we are in trouble as a result of that.

I'm suggesting that the federal government has a great responsibility to decrease their budget and spending, because they haven't got the dollars to cover the expenditure. In

summary, this is certainly a more viable alternative than to allow small business, the indi­ vidual, the family, and farmers to just drift into oblivion, go bankrupt, and dissolve. As I said before, we should develop a proper and very aggressive policy for natural gas, but for other products too, as we have been doing with the Alberta government's Department of Economic Development — International Trade. I conclude, Mr. Speaker, that the problem is largely federal. As a matter of fact, regarding interest rates it's exclusively a federal problem because they set the rates. We do not.

Regarding inflation of course, the problem is a combination of the federal, provincial, and municipal governments, including school trustees and those in charge of hospitals. So the solution is to cut back, not spend as much, unless we are willing to accept inflation and the problems that go with it, including high interest rates. I don't know what we're waiting for. Yesterday I said, are we waiting for Proposition 13's across the coun­ try? I think we are.

We probably need that at the steps of the Legislature, in municipal halls, and in school trustees' offices, to remind us that citizens are sick and tired of non-essential expenditures. Mr. Speaker, what have we done in Alberta? The hon. Member for Bow Valley covered some of them — you know, fuzzed over them — so I thought I'd repeat them.

In just 15 minutes I got about 25, but I'm not going to spend very much time on them: Alberta Opportunity Company 12 to 15 per cent interest rate for small busi­ nesses — the lowest in Canada; Agricultural Develop­ ment Corporation 5 per cent interest rate [on] up to $200,000 for beginning farmers, at a time when interest rates are 22 or 23 per cent. We have the lowest rate by far in Canada for first-time home-owners: 12 per cent, 5 per cent down. You can earn up to $31,000 and get into that program.

In addition to that low interest rate, if you earn only $13,000 you can have a subsidy up to $300, provided you're married or a single parent. We're subsidizing municipal borrowing down to 11 per cent, and municipal governments are complaining. Can you imagine? Interest rates are 20, 22 per cent, and municipal governments say that's too high because we're subsidizing it from that level to 11 per cent rather than 9 per cent — a $40 million subsidy. There's a 1 per cent rebate for Treasury [Branch] business loans — literally a forgiveness — another $4 million.

How about the lowest property tax in Canada by far — $400 to $600 for senior citizens now; $600 rebate per year for property tax for senior citizens. Rental rebate of $1,000 a year for senior citizens. The lowest personal income tax by far, the lowest corporate tax, and no gasoline or sales tax: it's almost unbelievable when I go over these things. I mentioned the municipal tax reduc­ tion plan and the natural gas price protection plan. Mr. Speaker, the hon. Member for Spirit River- Fairview is smiling. These are the result of people pro­ grams that we're targetting to give them a hand.

The natural gas price protection plan means that every home­ owner in Alberta who receives a natural gas bill recog­ nizes that that bill would be one-quarter higher — last year it would be one-third higher — if it wasn't for this plan. It costs millions of dollars. If that home-owner would slip into Ontario for a minute, he'd realize that natural gas heating for his home would be twice that price. And if he went to the Atlantic provinces, it would be three or four times that. We pay 100 per cent of hospital and social services costs. We have jobs like nowhere in Canada.

I can't understand anybody saying they can't find a job, provid­ ing they're willing to take any job. How about the Alberta family home purchase program — I told you already, 5 per cent down, 12 or 13 per cent interest rate. How about the pioneer repair program for senior citizens: a grant up to $2,000 to repair their homes. How about land assembly, to allow municipalities to assemble land to decrease the cost of lots? How about trunk servicing for lands to decrease the cost of lots, again funded by the Department of Housing and Public Works.

How about the special deduction for apartment builders, providing that half the suites are rented at a lower rate? How about the self-contained suites for senior citizens, who pay only 25 per cent of their income? I could go on, Mr. Speaker. That isn't all. What it amounts to is that a family of four — husband, wife, and two children — living in Alberta actually saves $3,000 to $6,000 every year. These figures are approximate, but I'm sure it will be closer to $5,000 by living in Alberta. If you live elsewhere, you would lose that. I want to target in on one item.

At a time when rates are 22 and 23 per cent, the mayor of the city of Edmonton wrote a letter to the government indicating he was very upset about the fact that the municipal debt reduction plan rate was increased from 9 to 11 per cent. Gee, what a hardship. No other government in Canada does this. He says: The impact of current inflation on the taxpayers of The City of Edmonton is partially reflected in the financing of our Capital Projects . . . Indeed it is. It is uncontrolled in many ways. When we talk about the convention centre going from $32 million to $84 million and, as I understand, no tenders . . .

The hon. Member for Bow Valley knows, and I know, and members know, that if we as private entrepreneurs did that just once, we'd be buried. How about the waste and overspending from time to time? And we're all — provin­

862 ALBERTA HANSARD May 21, 1981 cial, federal, and municipal — responsible for that. Mr. Speaker, I love that note. I won't comment on it. The natural gas export tax, the stifling of development and exploration, and the failure to recognize the need for industry to have profit to offset the high risk that ex­ ploration takes, are all a responsibility of the federal government. They have failed terribly, and they don't even recognize the multiplier effect of other industries that benefit from this, not only in Alberta but in eastern Canada. I think it's gradually sinking through.

What have we done in Alberta regarding energy? Let's zero in on that. I mentioned the cost of heating a home is three-quarters what it ordinarily would cost, twice as much in Ontario, and three or four times more in the Atlantic provinces. We've subsidized the petrochemical industry. Why? Because it produces jobs; it diversifies our industry. Those individuals and families are working, making money, and able to counteract high interest rates. There's no gasoline tax — we're speaking about energy now.

There's farm fuel allowance — that wasn't men­ tioned — again, a benefit and advantage over other farmers in Canada. There's relief for small drilling com­ panies, high employment, and how about the 1,000 hop­ per cars we produced so western grain can be shipped to the coast and sold? Again, the hon. Member for Spirit River-Fairview is laughing at that.

He has difficulty that we've subsidized and provided those cars to help western grain farmers. [interjection] We continue to press for co-operation with the federal government to take the pressure off the Canadian dollar internationally by developing these critical items of ener­ gy. Our energy in Alberta is immense. Coal value in Alberta is equal to the tar sands. I don't know if hon. members really recognize that coal energy value is equal to the tar sands — and that's a lot of money. There are strengths, and the federal government should be helping us develop.

How about the harmful effects on our economy in general? There is a need to reassess and arrive at a satisfactory energy policy — I've indicated that — devel­ op pricing policies acceptable to the federal and Alberta governments, and get on with the supply problem. We provide dollars to foreign countries at $40 and $50 a barrel, and we pay Albertans 40 per cent of that. So we're actually doing exactly what we should not be doing; that is, giving money to foreign countries for something we have here. It's unbelievable. Mr.

Speaker, I have difficulty stopping in one minute, but I'm going to have to try because you've given me a note. I come to conclusion by saying that with all the things we've done to shelter our citizens — and we shall continue to do that — I hope the citizens have the wisdom to realize that this costs many millions of dollars, and we only can do it because of our depleting natural resource.

I recommend another item, a temporary meas­ ure: for existing conventional business and farm loans up to $100,000 or $200,000, a rebate shielding up to 5 per cent for one year only to get Albertans over the hump because of the unprecedented interest rates, and not go below 17 per cent — a shielding of 5 per cent for one year as a temporary stopgap measure essentially for farming and small business.

Number two, for home mortgages up to $50,000 or $75,000 where people have to renew their mortgage at the new ridiculous rate, I recommend that the government also consider 5 per cent shielding for one year, no matter what the term or condition is, to get them over the hump. Again, they're for renewed mortgages only, and where citizens are actually living, not a new one. That would give them breathing room. Mr. Speaker, I know there are arguments for that. I conclude my comments: this adds many millions of dollars, maybe $100 million or $200 million.

We've already done a lot and taken many measures to lower the tax burden on citizens. I know we can give arguments for and against that. We're not an island unto ourselves, but I recom­ mend that in view of the terrible circumstances we're under right now. Thank you, Mr. Speaker. MR. NOTLEY: In entering the debate today, I was cer­ tainly intrigued with the modesty of the hon. Member for Edmonton Kingsway in outlining the government's re­ cord.

Something that one always notes when government members speak is the self-effacing nature of most of their comments, you know, that humility that sort of comes through, over and over and over again. Mr. Speaker, in addressing this particular subject I was interested in the observation of the hon. Member for Edmonton Kingsway that one thing we might do is elimi­ nate certain types of unnecessary expenditure. Perhaps the hon. member might start right here in Alberta with the $920,000 we are spending to flaunt our role in London. If we want to start with unnecessary expendi­ ture, the hon.

Member for Edmonton Kingsway talked about the convention centre going from $34 million to $80 million. No question about that — very disturbing. But then hon. members in this House should look at Kananaskis going from $40 million to $210 million. Mr. Speaker, if we're going to be the kettle calling the pot black, I think we're going to suffer a real credibility gap as far as most Albertans are concerned.

The hon. member mentioned Petro-Canada and the payment made for the acquisition of Petrofina, but neglected to point out the 56 per cent over the closing average that the Alberta Energy Company paid for the Noranda share of B.C. Forest Products. Mr. Speaker, when one looks at the resolution before us, one area I agree on with the hon. Member for Edmonton Kingsway — and I certainly compliment the Member for Bow Valley for introducing the resolution — is that there is no doubt at all about the negative impact of high interest rates on farmers, small business men, and home-owners in this province.

But despite all the as­ surances of government members, if a mortgage is being renewed at a substantially higher interest rate, that's small consolation to that young couple who suddenly find they're paying $900 instead of $700 a month, or $1,000 instead of $800 a month, or small consolation to the small business man or the farmer who find the working capital that they have to borrow has gone up to exorbi­ tant rates. The hon. Member for Edmonton Kingsway talked at some length about the debate in the House of Commons.

Again, it would be a little more impressive had it not been for that nine-month interregnum when the Tories were in office, when Mr. Crosbie, the then Minister of Finance, echoed almost every statement the governor of the Bank of Canada made and defended the position of the Bank of Canada, not only with respect to artificially maintaining the value of the Canadian dollar but also high interest rates, because high interest rates began to develop as a serious problem in this economy some time ago, including the nine months the Conservative govern­ ment was in office.

So there was no break, if you like, from the tight money policy of the preceding Liberal government, the succeeding Conservative government,

May 21, 1981 ALBERTA HANSARD 863 and the succeeding Liberal government. For the last number of years, we've allowed the Bank of Canada to carry on this insane policy of attempting to control infla­ tion through higher interest rates. Mr. Speaker, one thing this government should be doing — and the hon. member mentioned the profits of the banks. In this period of high interest rates, there is absolutely no doubt that there are winners and losers. Some of the obvious winners are the major chartered banks, whose profits have gone to record heights. There's absolutely no question about that.

The five largest banks have more assets than the 200 largest known financial corporations rolled into one. Since 1970, assets of the five big banks have increased 480 per cent, from $43 billion to $206 billion. If one looks at the most recent figures, the first quarter of this year compared to the first quarter of last year, we find Bank of B.C. profits up 87 per cent, Bank of Montreal up 69 per cent, Bank of Nova Scotia up 55 per cent, Bank of Commerce up 54 per cent, Royal Bank up 83 per cent, and the Toronto Dominion Bank up 79 per cent.

It seems to me that one thing the provincial govern­ ment should be doing is making very strong formal repre­ sentation to Ottawa to simply say that if there are going to be winners and losers in this business of higher interest rates, some of the winners' windfall should be shared more equitably. Talk about the deficit the federal gov­ ernment has; it's a matter of serious concern. One reason we have a deficit is that we aren't collecting money from some of the people who should be paying their share of the corporation tax, and that — top on the list — includes the chartered banks.

Let's look at an excess profits tax to deal with the windfall profits of record size that all the major banks are enjoying as a consequence of these interest rates going up time after time after time. I challenge the government. Where has this government been? It's fine to talk about the adverse features of the Liberal government's and, before it, the Conservative government's high interest rates and tight money policy. But let's look at what can be done.

One thing the federal government should be doing, and should have the sup­ port of the provincial government of Alberta, would be an excess profits tax on the record profits of the banks. Mr. Speaker, in the three or four minutes left before we get into discussion of private members' Bills, I want to deal with the question of what should be done in this province. The Member for Edmonton Kingsway and other government members can recite various programs we have in place.

But the fact is that these programs, useful as they may be — the Alberta Opportunity Company, programs under the Agricultural Development Corporation — could be a good deal better if they were more adequately funded. I look at the balance sheet of the province of Alberta, including our heritage trust fund.

I find that we could move some of the money which is now in marketable securities, some of the money we have in the accumulated cash surplus of the province, which is in marketable securities, into already established agencies — we have the home mortgage program, the Alberta Opportunity Company, and the Agricultural Develop­ ment Corporation — so we could get more loans out to people, not just lenders of the last resort but more loans to people who need it. I'm not convinced we should be bringing in shielding programs to prop up the profits of the chartered banks.

It seems to me that all we'd be doing in that instance is taking Alberta dollars to subsidize the interest rates the chartered banks are charging, thereby guaranteeing them a profit. Frankly that is one of the problems. If we're going to be using Alberta heritage trust fund dollars, we should be following through on some of the programs we already have in place with some of the vehicles which are in place, so that in fact that money is being used by Albertans for Albertans and not simply funnelled through banks, which I might add, Mr. Speaker, for the most part are totally controlled in eastern Canada. Mr.

Speaker, I look also at some of the practices of the banks. The hon. Member for Edmonton Kingsway talked about the fact that the average person pays 2 or 3 per cent above the prime interest rate, which this morning reached a record level of 19.06 per cent. But what wasn't pointed out is that most corporate borrowers, both in Canada and the United States, get their money from the banks at substantially under prime interest rate.

One recent study in the United States, for example, shows a disparity of as much as 4 per cent between the so-called prime interest rate and the rate [at which] corporate borrowers are getting money from the banking system in that country. It appears that a similar spread exists in Canada. Frankly, Mr.

Speaker, I find it a little difficult to rationalize to the average small business man or farmer in this province who has to go to a bank and pay interest at a rate of 21 or 22 per cent or in that neighborhood, that isn't directly shielded by the government, why they have to pay that kind of interest rate when a large corporation can get money for anywhere from 4 to 5 per cent below the prime interest rate. Mr. Speaker, in view of the time, I beg leave to adjourn debate. MR. DEPUTY SPEAKER: May the hon. member ad­ journ debate? HON.

MEMBERS: Agreed. head: PUBLIC BILLS AND ORDERS OTHER THAN GOVERNMENT BILLS AND ORDERS (Second Reading) Bill 221

An Act to Amend The Municipal Election Act MR. OMAN: Mr. Speaker, I'm pleased to be able to comment on the Bill, which is an amendment to The Municipal Election Act. First, I'd like very briefly to indicate what I would like to see accomplished in this Bill.

There are basically three sections: one having to do with the limit to the amount that can be spent by either a mayor or a councilman in a given election; second, this Bill would limit the amount of any donation that would be made to a candidate either by an individual or a corporation; and third, this Bill would require disclosure of any gifts over a certain amount. Let me go into the details. As far as a mayor is concerned, this Bill would limit expenses in a mayoralty campaign in a municipality in the province of Alberta to $20,000 or [$125] per 1,000 population in that district.

That works out to a maximum of about 12.5 cents per person or, in a city the size of Calgary or Edmonton, approximately [$7,500] to $8,000 by their populations today. With regard to a councilman, there is a separate limitation: a ceiling of $10,000 per ward or $50 per 1,000 population in that ward, which

864 ALBERTA HANSARD May 21, 1981 works out to an expenditure of 5 cents per person. As far as the limit to the amount of donations is concerned, any corporation or individual would be li­ mited to a donation totalling not more than $2,000 to a mayoralty candidate and not more than $1,000 to a councillor or alderman. As I indicated, the Bill also requires disclosure, not of all gifts, but of all gifts that would total over $100. Those could either be in money or service in kind.

By that I mean that if someone donated office space for a headquarters or printing or whatever, that would have to be evaluated and declared. Those would have to be published — given to the city clerks of the various municipalities, and laid open to public expo­ sure for anyone who wanted to investigate. The question then comes up: why these limitation? First, it's interesting to note that almost all governmental levels in Canada, provincial and federal, have brought in these kinds of limitations or controls.

With the exception of Quebec, and probably Saskatchewan in the not too distant future, these controls have not been placed on municipalities. It would seem that what is good for one level should certainly be good for another. These controls or limitations on the municipalities are very similar to those on the provincial government, of which we here are a part. The only basic difference is the limitation on expenses. In provincial elections, there is no limitation on expenses. There is some validity for the difference.

In a municipal election, it's not impossible that it could hap­ pen, but for the most part you do not have a party system that raises funds for you. The individual candidate is on his own. I've been there. I know some of the pressure that is faced in raising the amount of funds involved. The "why" also comes out of my own experience, and the experiences particularly of our major cities, Edmon­ ton and Calgary. I know of one candidate in the last civic election in Calgary who spent over $150,000, and other candidates who came close. In fact, one candidate, Mr.

Phil Elder, who had earlier declared, came to the point where he felt himself under tremendous pressure. In the election process, there comes a point when you feel you have to keep up with the Joneses. That means committing yourself to advertising expenses, sometimes 5 or 6 weeks in advance of the actual times so you can get those time slots. The candidate has to put himself out on a limb and say, we're going to go or, we're not going to go.

I recall from personal experience that when I ran for mayor in Calgary some three and a half years ago, I was personally indebted and had to write a note to my bank for some $40,000 in order to make the commitment for television and newspaper advertising rights. If a person doesn't have some sense of financial standing, it is some­ thing that could absolutely ruin you if things didn't pan out. It was not a particularly comfortable feeling and almost caused me to reconsider whether or not I should continue. Last fall in the city of Calgary, Mr.

Elder had to face that decision, decided he could not take the risk, although I think he had some viability as a candidate, and therefore dropped out of the race. Even the former mayor, Mr. Alger, who had conducted a very expensive campaign, said before that election was over that some kind of limits should be placed and give some sense of reason today to campaign expenditures, at least within our major cities. What has happened?

What is likely to happen is that the type of candidates will be determined either by their own personal assets — in other words, they are financial­ ly independent and can take the loss if necessary — or by special interest groups, who will fund candidates who may look favorably upon their particular interests, or we find that the risks are too high for the alternative candi­ dates. Mr. Speaker, I'm really trying to open it up so that you at least have the opportunity for a number of candidates of different shades, colors, assets, and so on, to be able to participate in the elective process of our municipalities.

The limit on gifts runs very close to the limits on expenses, but I know that in the city of Calgary questions have been asked: when we are spending $150,000 or as the case may be, where is it coming from? And if it is coming in rather large sizes from particular interest groups, is not an indebtedness automatically incurred to do special favors? Those questions have been asked. I think that by and large they have been without founda­ tion. I certainly would accuse no candidate I know of on the political scene of succumbing to temptation or being bought. But the fact is that the questions are being asked.

They are being asked by individuals and by some news media people. It seems to me that if we make reasonable limits — I know you can say that if a man is going to be bought, he can be bought for $100. Nevertheless there is a bit of difference between a $1,000 or $2,000 gift and a $10,000 or a $20,000 gift. Unconsciously that association is put within the mind. If you can spread that sort of responsi­ bility over a great many donors, it is a much safer way to do things, as we have seen fit to do within our own constituency of the province.

Finally, there has been great pressure to disclose where these donations have come from. With the kind of pack­ age I am proposing, where at the same time you have a limitation on expenses and donations, and a requirement for disclosure of all gifts or services over $100, those questions will be answered. At least there will be expo­ sure, and one doesn't have to wonder if there are hidden forces here. They will be out in the open. Any relation­ ships there might be will be known. I think it's a simple matter of common sense, that this is a safe way to conduct elections.

After the recent situation we've had in Calgary, The Calgary Herald had an editorial on election funding: Money may not be able to buy the mayoralty office, but it's a bigger factor than it should be. Phil Elder, a university professor who pointedly aligned himself with communities fighting adverse effects of growth, dropped out of the mayoralty race last week because he couldn't raise enough money for even a modest campaign. That's a pity. Even if his chances for winning weren't very bright, he had been intent on focussing on policy issues.

Mayor Ross Alger, in expressing sympathy for Elder's plight, conceded that money is a bigger factor in the election process than it should. At best, the mayor was only partially correct when he went on to suggest that putting up financial support "is, in ef­ fect, voting for a candidate and when a candidate doesn't have funding, it tells you something about the candidate." It also tells citizens something about the nature of those who contribute to general election campaigns.

Given Elder's opposition to many current develop­ ment practices, it does not come as a big surprise that he was not a successful fund-raiser. The ordinary citizen doesn't get very involved in election campaigns — about half the eligible voters don't even bother casting ballots. This gives extra

May 21, 1981 ALBERTA HANSARD 865 clout or extra "votes" to business firms and develop­ ers contributing to mayoralty and aldermanic campaigns. The system isn't working in the best interests of citizens when a relatively small group can decide which candidates will be able to wage expensive, high-profile image campaigns. Mayor Alger has suggested the province should set limits on campaign spending. Reform should go a step further. Candidates should be required to pro­ vide audited financial statements, along with the names of major donors.

It's a matter that deserves careful study by munici­ pal councils and the provincial government. That's why I bring it here today, Mr. Speaker. Let me say something with regard to comparisons of what is being done. I'll not go into too much detail. The province of Quebec now has on its books very, very limiting legislation with regard to all phases. It is all- encompassing on all municipalities within the province. The province of Ontario is a little bit of a question mark, because their legislation seems to be somewhat contradictory.

Nevertheless the city of Ottawa, under what they thought was permissible, passed a resolution in council in 1978, I think, which limits election expenses, and the guidelines are as follows: alderman may not exceed $3,000 for expenses — I'm giving them considerably more leeway here; mayoralty candidates may not exceed $20,000 for expenses; any person who gives a donation exceeding $100 to an alderman must have a listing sub­ mitted — all goods, services, and advertising and printing fall under the term "donation"; each candidate must meet a stipulated deadline before which he must submit his expenses to the city Clerk, who will then submit this information to the chief commissioner and, finally, the city council itself for review; there is a $1,000 penalty for anyone who contravenes this by-law; within the provin­ cial Election Act there is a

section which gives authority to municipalities to pass the aforementioned by-law. As far as I know, Mr. Speaker, that's the only city that has gone whole hog at this point under that permissive legislation, although the city of Toronto has required that each candidate must file his expenses with the city Clerk's office six months after the election has taken place. I mentioned that [Saskatchewan] is presently reviewing its municipal elections, and it is expected that in that pack­ age will come a series or a package of limitations such as I have proposed for Alberta. But that's still up in the air.

When I first introduced this Bill in the fall sitting, Mr. Speaker, it was purposely done rather late so that we would have notice of it and then give opportunity for response. I sent a letter to the mayors of all the cities in Alberta and asked them to look at the Bill and to respond. I got replies from most cities; there were a couple that did not. I would like to pass on to the Assembly some of the replies I got. Some were positive for the most part; some were negative. The city of Wetaskiwin writes as follows. MR. DEPUTY SPEAKER: I regret to interrupt the hon. member.

I have allowed some latitude already in the reading of extracts from printed materials. Perhaps he could summarize and give his own idea of what was in the letters, but not read directly. MR. OMAN: Fair enough, Mr. Speaker. The city of Wetaskiwin passed a motion unanimously endorsing Bill 210. The city of Fort McMurray, in a letter dated January 9, passed a resolution supporting Bill 210. The city of Medicine Hat, on December 15, passed a resolu­ tion to receive the information, and said it would not have any direct or adverse effects on the city's candidates.

I also got a letter from one of the aldermen in Medicine Hat who apparently didn't think that enough communi­ cation had been made and so he said, I think you're trying to kill a flea with a sledge hammer. The city of Grande Prairie also said that this legislation wouldn't particularly affect them because of their size, and suggest­ ed it would have particular effect on the two larger municipalities. [Mr.

Speaker in the Chair] The city of Red Deer, in a letter of December 29, passed a resolution: RESOLVED that the Council of the City of Red Deer hereby support in principle the proposed revi­ sions to the Municipal Elections Act as submitted by Mr. Ed Oman, including amendments to same as provided by the City Clerk. The city of Camrose did that in principle. They had some concerns with regard to the original Bill because it was based on electors rather than population, which would require them to take a census every year, and they didn't want to do that.

For that reason I changed the new Bill and based it upon total population rather than electors. The mayor of the city of Calgary wrote me a letter on December 10, in which he says I have his full support on this Bill. I believe the Edmonton city council passed a motion petitioning the provincial government to bring in at least a disclosures requirement Act. I bring these forward to indicate that on a general basis, there is rather wide support for the thing I'm trying to do here today.

Finally, I would like to say that there is another way we could use to approach this, and that is by way of permissive legislation whereby we could grant to munici­ palities the right to impose these kinds of limits upon themselves should they like to. That's one way to do it, Mr. Speaker. The problem we might run into there is the matter of uniformity across the province; you would have all kinds of different stipulations and limitations in various municipalities.

It also seems to me that there is the possibility of some conflict of interest in the councils' voting on their own regulations, although that could also apply for the province in the way we do it here. In closing, I simply suggest that we take the initiative. We have felt this is necessary for our own regulations. My own experience and the experience that has taken place in our municipalities indicates that something needs to be done. I urge that we take action. MR. COOK: Mr. Speaker, I'd like to support the Bill proposed by the hon. Member for Calgary North Hill. It has a good fundamental base behind it.

At it's heart it is, I think, an attempt to further the democratic spirit at the municipal level. It attempts to require candidates to dis­ close their sources of funding. I think that is essential. The fact is that our two major cities, Calgary and Edmonton, are becoming big business. I have a quick outline of the budget for the city of Edmonton in 1981. In this fiscal year, the city proposes to spend about $550 million on capital expenditures and another $350 million on operating expenditures. It comes awfully close to $1 billion. When one reads over The Municipal Government Act and starts to appreciate the

866 ALBERTA HANSARD May 21, 1981 broad range of responsibilities that municipal govern­ ments do have, and when one appreciates that the cities of Calgary and Edmonton are becoming increasingly sophisticated and very competent, it seems odd that we don't have disclosure of campaign contributions. As my hon. friend from Calgary pointed out, a number of candidates in the last civic election found difficulty trying to raise the funding necessary to run in a very competitive civic election race. Mr. Speaker, my own interest and involvement in this issue comes from my activity in a civic party in Edmon­ ton.

Hon. members might know that I've been active in URGE. It tends to be a party that emphasizes community involvement. It's a civic political party. The Urban Re­ form Group of Edmonton has at its heart an attempt to DR. BUCK: You should run for mayor, Rollie. MR. COOK: My hon. friend from Clover Bar suggests that I should run for an office in another place. But I think that's only because he appreciates the contributions of government backbench members, and feels a little intimidated by the impact of the upperbenchers. Anyway, my own interest stems from my involvement in the Urban Reform Group of Edmonton.

Last time, we fought an election campaign and succeeded in electing four members to council. But our campaign emphasized grass roots involvement, and did not have a lot of cash. It was a very difficult race to fight. Unfortunately, as my friend from Calgary points out, interest in civic politics is not all that great, although it should be. Basically, the development industry falls or rises on the decisions made by a 13-member council. Hundreds of millions of dollars are at stake. It's not uncommon for that business community to make some contributions to candidates.

Earlier this year, Olive Elliott wrote in a column that people have a right to know where money comes from. If a candidate is primarily financed by a particular special interest group, it's important that the people know that, so they know where that individual is coming from as he votes on matters of civic importance. Mr. Speaker, elections are becoming very expensive and competitive. To run an effective race in a large ward in the city of Edmonton requires some $10,000 or $15,000. To run an effective mayoralty campaign, it can cost up to $100,000 or $150,000.

I think our democratic spirit tries to provide for equal opportunity for candi­ dates to express their views, make their points with the electors, and then ask the electors to use their best judgment to pick the right person and, as a result, in­ fluence decision-making at council, the legislative level, or in Parliament. The concept that my friend from Calgary has brought before the House today has been adopted by this Assem­ bly for its own purposes. In this Chamber, we all recog­ nize that it's important that there be disclosure of con­ tributions. It's thought to be fair and just.

The public good demands not only that there be justice, but that it be seen to be done. I'm not suggesting for a moment that councillors at the municipal level are prone to temptation with donations, and then having that influence their decision-making. But I do think it's important, for the good of public perception, that we move in the direction of Bill 221 and try to take away the shadow that haunts a lot of our councillors as they vote on some very large projects, having hundreds of millions of dollars at stake and developers anxious to press their case. I think the Bill has a good foundation, Mr. Speaker.

It does concentrate on contributions and disclosures. I think it's important that in the future we give greater considera­ tion to the rise of civic parties. We're certainly seeing that take place in Edmonton. I think the experience of URGE is a good example. The Urban Reform Group provided basically all the sign materials and brochures, a lot of volunteer back-up, and actually assisted in the renting of office space, because we wanted to make sure that our campaigns were effective in all the wards.

I think it would be important to note where the civic party derived its money as well; not just the candidates, but civic parties. Because of the success of URGE and another political party, I think we're going to see alterna­ tives being developed in the next civic election in the city of Edmonton. In that kind of competitive race — party versus party, and candidate versus candidate — party contributions and disclosure are going to be an important facet of civic political life. Mr. Speaker, politics is essentially community decision­ making.

I think it's important that we make community decision-making at the municipal level open, and seen to be open. As I've mentioned, the city of Edmonton is becoming a big business, very sophisticated, and quite responsible. I think it deserves the opportunity to have a mature political campaign conducted in an open and democratic way. As proposed by the Member for Calgary North Hill, this Bill goes a long way to meeting that need. It has the broad support of a number of municipalities, including the city of Edmonton. A majority of the alder­ man on this council are in favor of this.

The mayor of the city of Calgary and the mayors of other cities and towns in the province are supportive. I'd just like to reiterate my support of the Bill and suggest that the only real deficiency I can see is that it doesn't consider the rise of political parties at the civic level. It's going to be an increasingly important phenomenon. So with that, I'd like to ask all hon. members to support this Bill, and encourage the member to continue his fine work. MRS. FYFE: Thank you, Mr. Speaker. I'd also like to make a few comments related to Bill No. 221, proposed by the Member for Calgary North Hill.

I see some merits in the aspect of the Bill, particularly in the larger cities. But I must say that I have a few reservations about its application across the province. One objective of municipal elections is to allow rate­ payers of a municipal corporation to have the democratic right to choose a person or persons who represent them on council for a period of about three years. I believe it is becoming more and more difficult to encourage responsi­ ble people to run for public office. I believe there are probably a number of reasons for this.

Firstly, one very strong contributing factor has been conflict-of-interest legislation that has been broadly interpreted by the courts. It's not the legislation that I have concerns with, but in certain decisions the

interpretation has disquali­ fied, for indirect pecuniary interests, persons sitting on municipal council. Precluding many individuals from seeking office be­ cause they have a particular business or because they're involved with a particular profession, means that very qualified people who are very interested in local govern­ ment, very worth-while people are simply not eligible to become involved in local government decisions, if they want to participate in a full way, without divesting themselves of some of their personal interests. I think this

May 21, 1981 ALBERTA HANSARD 867 has contributed to many people not being able to get involved in public office. Secondly, I think another factor related to the discour­ agement of some very qualified and interested people relates to the public demand for increased government services. There's a desire on the part of the public to become more and more involved in the decision-making processes, and this has certainly changed the way in which many decisions are made. I'm not opposed to public involvement; I think it's healthy.

But I do think it has had an effect on encouraging people to get involved in the public arena. As the media covers many council and municipal meet­ ings, which were basically handled behind closed doors in the past — decisions were made without the involvement of the public — I believe that the citizens of our munici­ palities are much more aware of what happens at meet­ ings now than they used to be in the past, and I feel that many of these people have made a conscious decision that it is a controversial way of life.

I think many people have said that they do not feel they have the time and energy to devote themselves to many controversial aspects of decisions that have to be made at the local level. As mentioned by the previous speaker from Edmonton Glengarry, municipal business has become large business, and that's true. The municipal corporation carries on fiscal expenditures and has to make financial decisions that have very far-reaching repercussions.

However, related to this Bill specifically — and I have listed a couple of areas that have discouraged or pre­ cluded certain people from becoming involved — I would say that there are very different problems between rural centres and the large urban centres. For example, the city of Edmonton has approximately 125,000 people per ward. That requires a campaign much different than a campaign that would be carried out in the city of St.

Albert, where there are no wards but representatives elected from the whole community; or different from a small town such as Bon Accord, or a rural municipality such as the municipal district of Sturgeon, where there are wards and the residents of that municipality are rather spread out. I believe there is some argument for limiting the funds spent in large urban areas, simply because there is a tremendous reliance on electronic and other media. As those of us who have been involved in campaigns know, this type of advertising, this type of campaigning, does not come easily.

But when you're facing a ward of 125,000 people and you must cover that yourself, it's literally impossible to get to even a tenth of the individu­ als on a one-to-one basis. So there has to be a reliance on different media. Obviously this would provide an advan­ tage to the candidate who is able to receive larger contributions. For the person who is a very serious candidate, I think there is something to be said that that person should be encouraged to develop a well-organized campaign that encourages many of his fellow ratepayers to become in­ volved and to assist in the organization of that campaign.

Without that type of organization, it is very difficult for one person acting on his own to seek election. But the argument that goes against limiting funds is that it en­ courages candidates who perhaps are not serious. As I said previously, we have found that a number of people are not able to seek public office or are discouraged. If we encoura