1995 Legislative Session: 4th Session, 35th Parliament HANSARD

The following electronic version is for informational purposes only. The printed version remains the official version.

Official Report of

DEBATES OF THE LEGISLATIVE ASSEMBLY

(Hansard)

THURSDAY, MARCH 30, 1995

Afternoon Sitting

Volume 18, Number 10

[ Page 13143 ]

The House met at 2:03 p.m.

F. Jackson: I have an introduction today on behalf of the member for Okanagan-Penticton, who is indisposed. Visiting in the Legislature today from the Okanagan are David Finnis and his children, Daniel and Stephen. On behalf of that member I would ask that this House make them welcome.

Hon. M. Sihota: In the gallery today witnessing the proceedings is a good friend and a resident of Esquimalt, Mr. Bob Close.

I just turned 40 the other day so my eyesight may be failing me a bit, but I also....

Interjections.

Hon. M. Sihota: Actually, I was trying to brag a bit. But I believe Mike Elcock, a former head of Tourism Victoria, is in the gallery as well.

I'd like all members of the House to wish both of them well today.

T. Perry: In the members' gallery is one of my medical teachers, Dr. Bill Ibbott, of Vancouver. He told me this morning that he had heard so much about the erudition of these debates he wanted to witness for himself. Would members please join me in welcoming Dr. Bill Ibbott.

H. Giesbrecht: In the gallery today is my constituency assistant, all the way from Terrace. Would the House please join me in making Gail Murray feel welcome.

M. de Jong: Joining us in the precincts today from the constituency of Abbotsford is a very good friend, Mr. Mohindar Gill, who hopes that he will be the lucky one to take the message back to his fellow constituents that the election has at long last been called.

Ministerial Statement

NATIONAL CENTRE FOR ADVANCED WOOD PRODUCTS PROCESSING

Hon. M. Harcourt: I am delighted to make an announcement which I'm sure will be of great interest, not only to the people living in the Abbotsford constituency but throughout British Columbia. I want to take this opportunity to inform the House of the announcement made this morning by me, the Minister of Forests and the Minister of Skills, Training and Labour, that British Columbia will be the new home of the new National Centre for Advanced Wood Products Processing.

As this House knows, my government took a significant step forward last year to secure a stronger future for our forest communities and forest workers with the establishment of the forest renewal plan. The forest renewal plan built on a partnership of business, labour, communities and government and is putting forest dollars back into the land, workers and communities that created those dollars in the first place. But the forest renewal plan is just a first step. Last week, in the throne speech, my government announced our jobs and investment strategy.

This strategy will help keep B.C.'s economy the strongest in Canada by further investing in people and our natural resources to produce good family-supporting jobs.

Today, in partnership with Forest Renewal B.C., the forest industry and the University of British Columbia, I am proud to announce that we have established the new National Centre for Advanced Wood Products Processing, to be located at the University of British Columbia, after winning an across-Canada competition. This new centre for excellence also has the federal government's support, and they will be announcing their specific support for this new initiative.

There's a fundamentally important reason why this centre is being established, which will be working in conjunction with a number of the colleges, with BCIT.... It will be involved with the high schools. It will be working on a very active continuing education program with existing workers. The problem is that today there are 2,000 value-added jobs that cannot be filled in our province, because British Columbians do not have these skills. Today's announcement is a major step in training highly skilled, highly paid workers for B.C.'s value-added jobs.

The UBC centre will offer a continuing education program that targets workers and communities not just in Vancouver but throughout the province.

I know that the opposition is critical of the forest renewal plan because they are fundamentally opposed to it. The Leader of the Opposition has said that it's not only bad for business but bad politics. Well, I believe that the establishment of this centre demonstrates that the forest renewal plan is not only good policy but good for businesses and workers across this province. The partners that have come together to cooperate in the establishment of the National Centre for Advanced Wood Products Processing are prepared to invest in our strengths and in up-to-date skills to increase our productivity and add value and jobs from the forests we harvest.

I know this is a proud day for the University of British Columbia, for our forest industry and for workers as once again we show that British Columbia is leading the way to new jobs from renewing our forests and from value-added manufacturing.

G. Campbell: Obviously, all of us in this House must take some pleasure in the announcement today that we have the University of British Columbia, the provincial government, Forest Renewal B.C. and private industry coming together to look at how to provide more research and more value-added jobs in the province. However, let me say that this is unfortunately like so many of the announcements that we have from this government: it misses the main point about what's taking place in the forest industry in British Columbia.

If the Premier will take the time to go and speak with the people of northern Vancouver Island again, he will find out that his forest renewal project idea is not working for them. He won't even go and discuss with them the lack of fibre in their communities or the changes and dramatic impacts that have taken place on job losses and on families in the forest industry across this province. I've just come back from the Kootenays, where once again mills in the Kootenay area that are known for their value-added expertise are running out of fibre because of the government's land use decisions.

One of the things we have to recognize is that it's not good enough to try and protect the forest industry with public announcements like this. There are going to have to be some serious policy changes in the way this government approaches its problems.

First of all, let's be clear: Forest Renewal B.C., if it were in fact putting money directly back into the communities that generated it, would be a tool that could be used by Gold River and Tahsis. To date it has not been. Indeed, if you talk to people from those communities, hon. Speaker, they will tell you -- and they would tell the Premier if he would take the time to go and visit them -- that they are losing jobs and that

[ Page 13144 ]

forest renewal is not responding to their concerns; it is not responding to the positive and constructive suggestions that are being made in communities across this province on how we can deal with our land use decisions and how we can use forest renewal dollars to meet their local and community concerns and sustain them for the long term.

In terms of value-added, I think it's almost pathetic to hear the Premier talk about jobs in this province. This government's policies have done more to drive out private investment in the province of British Columbia than any other thing. Even when the Premier says something to someone, they can't count on him following through. We all recall what the Premier said with regard to the corporate capital tax, which was supposedly going to disappear when the deficit was gone. Now let's be clear: I understand the deficit hasn't gone, and so does the Premier.

But that's not what his public relations people are allowing him to say. The fact of the matter is that the corporate capital tax is hurting the value-added industry in British Columbia.

The government's land use policies are driving -- indeed, are taking --fibre away from a number of the value-added mills that require it, and they are having to go to Alberta and the United States. They are reinvesting south of this border, where 1,700 jobs have been located in Washington State alone in the last 18 months because this government's tax-borrow-and-spend policies drive investment away from the province and drive the value-added sector out of the communities of British Columbia. Whether it's Williams Lake or Cranbrook, whether it's Tahsis or Gold River, the government's public relations do not help.

There is hope when we can bring in the University of British Columbia and when we can bring in the private sector, and certainly we applaud that particular measure. But that measure by itself will do nothing to mitigate the thousands of job losses which are going to be generated in the forest industry because of this government's land use policies -- and because this government has not been willing to listen to the communities of this province about how it can provide for long-term, improving environmental action, as well as long-term, sustainable jobs and secure communities across the province of British Columbia.

[2:15]

R. Neufeld: First off, I'd like to congratulate the government on their initiative to have the National Centre for Advanced Wood Products Processing in British Columbia. I am a little dismayed that we didn't look a little to the north -- specifically, to have the centre at UNBC. I think all of us are aware that the member for Prince George-Omineca and I lobbied hard to get the government, during discussions about Forest Renewal B.C., to expend the money in the regions where the money was raised. We're having a little trouble getting that done, but the government did say they would live up to that. Thirty-seven percent of the money comes from the north.

Interjection.

R. Neufeld: Hon. member, if you want to speak to the minister's statement, you can, very shortly. I'm congratulating you; I'm not condemning you. He's so used to heckling, hon. Speaker, that he just can't get it out of him.

I was part of a committee that travelled the province to deal with value-added in our shrinking forest fibre and our shrinking jobs in the forest industry. I think we have to look further in order to develop ways that we can produce products in British Columbia -- British Columbia--made products -- that are value added to the forest industry, which we can sell worldwide. We have world-class people in British Columbia who can produce these products. We have the world-class wood; it's just a matter of being able to market it. I think that's the most difficult part: marketing it around the world. Also, the centre for wood products processing in British Columbia is a great move.

I would just like to say that we would like to see the government live up to its promise of spending the money that it receives in Forest Renewal B.C. in the area that it's taken from. That's the only criticism I have so far. We would like to see that money come back. It certainly hasn't come back to my area in British Columbia.

I would also like to point out that we, the Reform Party of British Columbia, supported Forest Renewal B.C. We think it's a good move in renewing the forests in British Columbia and in providing jobs into the future. I think that's what all of us should be looking at when we talk about important situations such as this: jobs for young people in the province of British Columbia so we can continue to receive the services that we do today.

The Speaker: The member for Powell River--Sunshine Coast rises on another matter?

G. Wilson: Hon. Speaker, I seek leave to respond to the ministerial statement.

The Speaker: I hear a nay, hon. member.

Leave not granted.

Oral Questions

INVESTIGATION OF GOVERNMENT INFORMATION LEAKS

J. Dalton: Yesterday we learned that some senior civil servants may be subjected to lie detector tests. Clearly, this tramples the rights of the individual and of professional public servants in particular. Will the Premier stand up for individual rights and prohibit the use of lie detector tests in this matter?

Hon. M. Harcourt: The hon. member should do as I'm attempting to do, and I hope all members of the House would follow suit: let the police investigation take place unhindered, without colouring it. If the member has any information that he is prepared to pass on to the police to help in their investigation of this breach of oath, then I'm sure they would welcome that. Other than that, I don't think we should comment on the RCMP commercial crime squad, who know the laws of Canada quite well.

J. Dalton: Clearly, the Premier doesn't get it, given the response that we've just heard. Without question, this lie detector plan is an attack on individual rights. I repeat that and remind the Premier of that.

My question for the Premier is: would he be willing to submit to a lie detector test the next time he's in Gold River and suggesting to the people of those communities that there will be no job losses in northern Vancouver Island?

Hon. M. Harcourt: Hon. Speaker, I hope that we'll have a retraction of those words and that he is going to eat those words within the week.

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W. Hurd: Today we learned that the government, in addition to the current police investigation, has hired a private investigator to stem the tide of brown envelopes in the province. Given that the source of the persistent leaks is unknown, can the Premier tell us whether his own caucus and cabinet will be subjected to a similar investigation? Or is the witch-hunt restricted only to public servants in the province who can't fight back?

Hon. M. Harcourt: A systems expert has been working with the comptroller general and my deputy to make sure that the confidential documents that come before cabinet are secure, and to make recommendations to my deputy and the comptroller general about the best way to secure those documents.

W. Hurd: My supplemental is to the Minister of Finance, who today speculated that the individual who leaked the budget documents may also have leaked the Chris Trumpy Treasury Board memo on the government's unsustainable debt load.

How can the minister make such a claim? Why would the individual who leaked the budget documents, which we assume are the truth, turn around and leak the Trumpy document, which was designed to cover up the budget leak in the first place? How can the minister suggest that the same individual could possibly be responsible for both events, when the budget was designed to cover up the effect of the Trumpy memo in the first place?

J. Weisgerber: My question is to the Premier as well. The Attorney General has confirmed that your use of a private detective to ferret out leaks in cabinet is unprecedented in B.C. history. The last time we saw this level of paranoia about leaks in government was at Watergate, and that didn't help Nixon much.

Interjections.

The Speaker: Order, please, hon. members.

J. Weisgerber: Can the Premier tell us how much the taxpayers are paying for his undercover snitch cop, and how much this little witch-hunt is costing B.C. taxpayers?

Hon. M. Harcourt: We have such a romantic writer in the leader of the Reform Party. He has a hyperactive imagination, but I remember history. I remember the Social Credit Attorney General, who hired some snitches to go in and sneak around in some pro-choice groups in Vancouver. I remember a Social Credit cabinet, which the leader of the Reform Party used to belong to, that didn't have to leak documents. They leaked cabinet ministers -- 12 of them had to resign. We couldn't keep track of them; we had to have a new

schedule of who was in the cabinet every day in this Legislature.

So if you want to talk about snitches and leaking, you should go back to your old Socred roots, when you take off your disguise of Reform, hon. member. I can tell you quite frankly that I'm going to let the security expert work with the comptroller general and with my deputy. The financial information will be available at the appropriate time and in the appropriate way.

I will tell you that this side of the House is not going to get on with the gossip and the allegations the other side is making. We're going to get on with our agenda, which is creating jobs and securing medicare against Liberals, both here and in Ottawa.

The Speaker: Supplemental, hon. member.

J. Weisgerber: I would be somewhat cautious, if I were the Premier, in drawing those parallels, because it seems to me that four years ago there were about 52 Socreds sitting across the way, and we know today how many there are in the House. I wouldn't be...

Interjections.

The Speaker: Order.

J. Weisgerber: ...too anxious if I were you, Mr. Premier, to draw the parallel, although indeed history starts to repeat itself in more ways than we care to remember, if we look around the vacant seats we have in cabinet today.

The Speaker: The question, hon. member.

J. Weisgerber: The Premier has refused to disclose the terms of reference he's given to this undercover investigator. If this person is being paid by taxpayers, then I believe they have the right to know the terms of reference for the person being hired. Will the Premier agree today to table the terms of reference he has given, and will he confirm that all the members of cabinet are subject to this same investigation that's going on into leaks in cabinet?

Hon. M. Harcourt: I can confirm that this systems expert was hired by my deputy at my request to review the security of cabinet documents. I left with the comptroller general and with my deputy the details of working with this systems expert to deal with the security of confidential cabinet documents. That is the simple instruction I gave to my deputy.

On the second part of the leader of the Reform Party's question as to how many Socreds are still in this Legislature, I think there are four right there and about 17 right there. And the only Liberals I see.... There are three right over there with slightly different names.

FREEDOM OF INFORMATION AND NDP BINGO LICENCES

M. de Jong: My question is also to the Premier and relates to another of the numerous investigations that surround his government. Several weeks ago the official opposition learned that the NDP or NDP-related organizations held 12 additional bingo licences. An FOI request was made for those files from the responsible ministry. Last Tuesday we were informed that those files had been forwarded to the minister's office for final sign-off and would be forwarded to us by the end of last week. To date, those files have remained in the minister's office.

It's clear that the NDP are deliberating withholding the files from the public and from the opposition until after the NDP convention. My question to the Premier is: will he immediately instruct his deputy and his staff to release those files without delay so that the public can get to the bottom of this rather sordid affair that continues to hang over this government?

Hon. M. Harcourt: I will take that question on notice and under advisement, and I'll get back to the member.

The Speaker: The member has a different question?

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NANAIMO COMMONWEALTH HOLDING SOCIETY

M. de Jong: I do, hon. Speaker. Last June the Premier ordered an independent audit of the NDP to determine the extent to which money illegally obtained by the NCHS had flowed to that party. On August 6 of last year, the NDP's president, Brian Gardiner, was quoted as saying that that audit would be available for release within two weeks -- fortunately for him, he wasn't connected to a polygraph machine at the time he made that comment. To date, that report has not been released.

Can the Premier explain why after ten months the NDP has not made their so-called internal audit available, and will he do the right and honourable thing and release that document to this House prior to their convention coming up this weekend?

Hon. M. Harcourt: I think the people of British Columbia are seeing that the Liberals in this House, the official opposition, just keep sinking lower and lower. They are now prepared to say that people who cannot defend themselves, who are not here in the House, should take polygraph tests. They're prepared to attack people's reputations under the privilege of this House. I think it's shameful that they're prepared to keep sinking that low.

[2:30]

The matter is under investigation by Mr. Parks, who is carrying out a very thorough investigation. It's my understanding that the New Democratic Party carried out an extensive review of the financial transactions of the party and passed on that information, at the request of Mr. Parks, to Mr. Parks to include in his investigation of this matter. It's my understanding that there was no evidence of any of those funds being received by the B.C. New Democratic Party, in spite of the slurs and the misuse of the privilege of this House by the official opposition.

PRIVATIZATION OF CROWN CORPORATIONS

D. Mitchell: I have a question for the Minister of Finance. A few "leaks" ago it was revealed that the government was giving some serious consideration to the privatization of certain Crown corporations, including B.C. Rail. The budget indicated that there were no plans. There was no mention of the word privatization at all in the budget, in spite of the fact that the minister herself speculated that the privatization of B.C. Rail might help to reduce the taxpayer-supported debt of the province. Can the minister tell us if the government has abandoned any plans, studies or consideration of privatizing B.C.

Rail or other Crown corporations? Or is the privatization of Crown corporations still being considered?

Hon. E. Cull: It's nice to get a real question on the budget. The whole question of government operations is currently under review. No decisions have been made with respect to any parts of government or Crown corporations, but we continue to look at the operations of government and make decisions as to whether they should remain within government or not. When we reach conclusions on our investigations and our studies on this, we will make announcements.

B.C. RAIL PROPERTY TAX GRANTS-IN-LIEU TO MUNICIPALITIES

D. Mitchell: Then, to the Minister of Municipal Affairs. The Minister of Finance has indicated that the government continues to study this issue, and in fact the budget tabled in this House indicated that the government was studying the issue of a fair share of property taxation to municipalities along the B.C. Rail line, possibly for 1996. Can the Minister of Municipal Affairs make the commitment today in this House that a transitional grants-in-lieu policy such as that recommended by the UBCM will be put in place this year -- in 1995 -- since the government now recognizes the commercial value of B.C. Rail?

Hon. D. Marzari: I'm very proud to say that the budget presented by the Minister of Finance a few days ago did speak to the ongoing transitional committee that has been formed with UBCM, and with a number of mayors and councillors of communities that are reliant upon B.C. Rail as one of their major resources, to encourage and look at the possibility of B.C. Rail actually returning to the communities something of what they take from the communities. This policy has been endorsed by the Minister of Finance, the Minister of Employment and Investment, and the Minister of Municipal Affairs.

I am proud to say that that table will continue to meet and look at the business of B.C. Rail actually working with communities in order to help them and to produce grants-in-lieu for them.

Orders of the Day

Hon. G. Clark: I call committee on Bill 6.

SUPPLY ACT (No. 1), 1995

(continued)

The House in committee on Bill 6; D. Lovick in the chair.

The Chair: Before calling the committee to order, could I just ask those members whose business is outside the chamber to please leave quietly forthwith.

On warrant 2 (continued).

Hon. C. Gabelmann: As we were adjourning this morning, the member for West Vancouver-Capilano asked me if any of the special warrant included moneys for a double-bunking program. Some of it does, so it is in order, and I should just answer the question quickly.

There are 185 double-bunk units now in the province. Out of this warrant that we're debating right now, $400,000 can be attributed directly to the double-bunking initiative. In '94-95 we spent approximately $1.7 million for double-bunking operational costs. If we had not double-bunked -- I'll just give the member this information -- there would have been an additional $10 million required.

J. Dalton: I'll probably just have two or three other questions to raise, and then there may be other members who wish to raise other points on this particular warrant.

Can the Attorney General explain to the committee the reason behind the higher-than-anticipated cost of social service tax payments for legal services? I must confess that I'm a bit confused as to why that cost overrun would have occurred.

Hon. C. Gabelmann: I thought I had explained that this morning; I'll try again.

Prior to the Korbin report, the services of many Crown counsel were contracted for rather than being direct employees of the ministry. Following the report, and given the

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social service tax legislation, there was a requirement that those lawyers pay the social service tax -- the 6 percent or whatever it is these days. Following Korbin's report, the government began the process of regularizing the employment of these individuals. Prior to then they had been hidden from the process by way of pretend contracts so as to allow the former government to pretend that these people were not employees when, for all intents and purposes, they were. They were recognized by the federal taxation department as such as well, who required that they be treated as employees.

The process to regularize these individuals and put them into the public service began. There was an expectation that the process would conclude by the end of March last year. There was no expectation that there would be a social service tax attributed to those people. In fact, the process of conversion took longer -- into July, as I understand it -- and therefore, during the period between April 1 and July, when the regularization was concluded, there was the unexpected cost of the social service tax. That came as a result of the conversion program taking longer to complete than had originally been understood or expected.

J. Dalton: I thank the Attorney General, both for that response and for the previous one. It was useful for us to hear the actual costs in the special warrant on the double-bunking issue, which is becoming more and more of a problem throughout correction facilities.

In connection with the overcrowding in correction facilities -- and double-bunking obviously touches directly upon that -- I would like to know about this other item in warrant 2: the keep-of-prisoners program. Is that not related to the whole question of corrections costing and perhaps even specifically to the double-bunking issue itself?

Hon. C. Gabelmann: The additional costs in the keep-of-prisoners program -- the $5.5 million going up to $6 million, which accounts for the $500,000 that we're asking for here -- is again part of this general pattern of increased numbers of people coming through the justice system. Those additional peoples were not anticipated; the costs were not anticipated. This is a cost that we rebate to the municipalities that incur these costs, under an agreement we have with the UBCM. It is now being reviewed to see if we can do these things in a cheaper and more efficient way.

D. Mitchell: I have a few questions for the minister under the special warrant issued under vote 17.

We're dealing with warrant 2, which is for vote number 17 in the Ministry of Attorney General. Correct? There's no confusion about that? The minister made his opening comments on those this morning.

I'd like to refer the minister back to some comments he made in this House last year when we were reviewing the estimates for the Ministry of Attorney General. We were talking in detail about vote 17 and about the correction system in particular. The minister will remember this in the context of the estimates debate in this committee last year, when we were approving the budget. The context was that there was discussion simultaneously about some concerns of confidence in our correction system -- the famous Danny Perrault case, for instance, and other cases as well. That was the context in which we were discussing this.

The minister might recall that there was concern raised in committee as to whether there were sufficient funds under vote 17 -- and in the corrections portion of that vote in particular -- to handle the need to accommodate the increased concerns and heightened public awareness on public safety issues.

I'll make just one reference for the minister's benefit. He might recall this from May 16, 1994, here in the committee. When we were talking about and approving this budget, I specifically asked the minister whether $211 million was enough under the corrections budget to accommodate the concerns being raised about public safety and security at the time.

The minister was quite unequivocal at that time. I know that unanticipated expenditures can occur and that the minister in his opening comments this morning in committee outlined some of the reasons for those. This minister said that while there might be areas where he would like to have spent more money, he did as well as he could at Treasury Board. There were some members here in this committee, this member included, who would have liked the minister to have done a bit better at Treasury Board in this area.

Even though the public wants to see government grow smaller and wants to see a tougher approach generally, this is one area where the government has an appetite for spending a little more if it's going to be addressing public safety issues.

In response to some of the comments the minister made this morning, I'd like to ask him about alternatives to custody and other alternatives that are being looked at so we can reduce the cost of corrections. That is what I'm addressing. The minister indicated this morning that the ministry is exploring alternatives to custody, for instance, for low-risk offenders. He believes that the ministry -- and the corrections branch in particular -- needs to focus more attention and even some financial support in this area for alternative measures other than incarceration.

Could he outline specifically what he's referring to when he talks about alternatives to custody and alternative measures other than incarceration? How can they be more cost-effective so that when we approach his budget this year in committee and the budget that was just tabled by his colleague the Minister of Finance, we don't have to go through this debate once again?

[2:45]

Hon. C. Gabelmann: The first thing I should say is that I hope we do have an opportunity in committee to have a decent debate. I don't mean a protracted one, but we should take some time in committee stage to hear ideas the members have about how we can deal with this general question of what we do with people who are convicted of criminal offences.

The member knows I have a strong commitment to alternatives to incarceration. I still believe that we in this country, although we do much better than the Americans, continue to incarcerate people who might otherwise be dealt with more effectively in a different way. I am quite happy to talk about that in committee stage, when we get there. I don't think it is necessarily appropriate at this point.

Over the last year we have added additional probation officers to the ministry's complement so that we can provide more community service and give judges more options in terms of being able to sentence individuals to community service where that is appropriate. We have expanded the electronic monitoring program. In addition to that, at the front end we are looking to make sure that police-based or Crown-based diversion programs are more readily available around the province. Those are initiatives that I would like to see us undertake.

As always, when you try to amend a system or to move in a new direction to try to do things differently -- hopefully

[ Page 13148 ]

better -- you incur the continuing costs of the old way of doing it and the costs of the new way of doing it, and they come at the same time. I think it doesn't matter what party's in power; this always militates against government actually bringing in reform of systems. You can't stop the old system on one day and start the new one the next day. You always have overlapping costs, and when you do, you have additional costs that governments have a hard time persuading taxpayers to support.

One of the reasons I would like a good debate in committee on this is so that all members of this House have a good understanding of the issue and can talk to their constituents about the need to do things differently. This would make sure that, while we bring in alternatives to incarceration to help deal with costs and rehabilitation and all of those issues, we do so in a way that has full public support, so there is an understanding that what we do -- and we should only do it this way -- provides full public security and safety at the same time.

Everything that we do and that I want our ministry to do has to always have the need for public safety and public security underpinning it. That underlies it all. In the long run, finding alternatives will in fact enhance public safety and public security, and that's why I'm keen on us moving in those directions. I don't think that's a debate for today, necessarily. But I would enjoy the debate, particularly if we have an opportunity to take some time in the Douglas Fir Room to do this.

D. Mitchell: I'll take the minister up on that offer when his estimates do come up in the House this year. I hope we can have that kind of meaningful discussion.

This debate in this committee today is one where we're trying to understand why the extra moneys that weren't included in his budget for the fiscal year that's completing tomorrow were needed specifically. The minister has explained in general terms this morning that when it comes to the corrections branch, $8.9 million that was not anticipated needed to spent in adult custody and $3.5 million in the youth custody program.

To understand why that would be the case, given the debate that we had in this committee last year when we were approving the budget for the corrections system, I'd like to refer the minister back to some words he said last year when we were debating his budget, which had been overexpended. The minister indicated one of the reasons why the corrections system has become more costly. I quote from him: "More and more relevant is the profile of the inmate population, which is far less benign as the profile that it was, say, ten or 15 years ago."

I'd like to ask the minister: would that be one of the reasons why we have spent in this fiscal year some $9 million more in adult custody and another $3.5 million in youth custody? Would it be because of the profile of the inmate population? If that's the case, could the minister explain what he means by that?

Hon. C. Gabelmann: In general terms it's fair to say that the profile of the inmate has not changed over the last year or two. The comments I was making last year hold true if you look at the current profile -- and by that I mean this year, last year, the year before and, as we continue into this next fiscal year, no doubt it will be similar -- and compare that with the profile of, say, five or ten and certainly 20 years ago. That was the point I think I was trying to make last year in the estimates debate. So the profile isn't particularly different.

But what's happened -- what's caused the additional cost -- is the volume. We've had higher numbers of people in the system than we had budgeted for or anticipated, and that's what caused this.

I'll put my Treasury Board hat on when I say this. One of the things we have tried to do with our budgeting is keep the numbers tight, so that all ministries -- and not the least this one -- are forced to try to do things in a way that is cost-effective. If you keep the numbers tight, then people are going to look for different solutions for spending and are going to ask themselves internally whether or not every dollar is being spent appropriately and effectively.

We don't treat lightly going over that budget, but in several cases within this ministry -- because of the volume pressures now -- we simply could not contain within the budget...although I believe we are spending far more efficiently and effectively, and the evidence of that is in the numbers. You can't entirely conclude that from these numbers, but there's something to it. While we increased our expenditures last year by 10 percent in the adult system and 12 percent in the youth system, the volume increased 18 and 26 percent respectively.

So this warrant doesn't anticipate paying for that volume increase, so obviously we have made some savings internally.

There obviously are economies of scale, so I don't want to make a direct analogy here. We have been able to deal with our sentenced population -- rather than just inmate population -- cheaper on a per-individual basis than we have in the past, and that's good. It gets driven a little bit by having tight budgets. This one, however -- as the member suggested last year, and as I feared -- was a little tighter than it should have been.

D. Mitchell: I have a couple of other questions that I'd like to address on this warrant, on vote 17. I understand what the minister is saying, but there has to be a concern in this committee that we hope not to be here again next year, if an election doesn't intervene.... The minister hopes to be here again next year, but we hope not to be here in this committee next year talking about special warrants for overexpenditures for vote 17. We'll address that when we talk about the budget that's coming forward to the Legislature in this session.

The total amount for vote 17 in the budget for the fiscal year just about to end was some $731 million -- a very significant amount of money. The overrun, under the special warrant that we're being asked to approve retroactively, is for some $33,618,000. I haven't worked out the percentages, but that overrun is probably somewhere between 4 and 5 percent on vote 17.

Interjection.

D. Mitchell: The member for Richmond Centre has informed me that it's 4.6. Can the hon. Attorney General tell us whether or not he feels that a 4.6 percent overrun on that one portion of his ministerial budget is acceptable?

Hon. C. Gabelmann: I'll trust the member's arithmetic. It's certainly between 4 and 5 percent, and that's fair enough -- overall, throughout the whole ministry; I haven't worked out the precise numbers for Corrections. The Corrections budget last year was almost $211 million. I'm not going to try and do the arithmetic on my feet, but certainly there has been an overrun here. The overrun is less on a percentage basis than the increased volume demands that the system has incurred. That may not satisfy people, but on a dollar-per-dollar basis we have not spent the additional money that would normally be required by the additional volume demands.

[ Page 13149 ]

Most of the ministry is driven by demands that we can't control. I can't turn on or off the tap of people who come into the justice system. Through community prevention programs and a whole bunch of other things over the long term, we can try to diminish the crime rate out there. But for the most part we can't control the tap, so we deal what we get. We've had overruns, but the overruns don't match the overrun in demand.

D. Mitchell: I'm a little bit puzzled by what the Attorney General has said, because surely there must be some credibility to the process that we go through in this Legislature when we're asked to vote on expenditures, when we're asked to vote supply to a ministry of the Crown. There must be some basis for the estimates that they put together and bring to us. Even though we perhaps cannot anticipate scientifically to the dollar or to the penny, there must be some formula. There must be some way that the minister can tell us that the estimates he brings forward to us can be trusted. Otherwise, how can we be expected to vote on them?

How can we be expected to vote supply when the minister comes to us after the fact with a special warrant, saying there's no way he can tell, because he can't turn the tap on or off. There has to be some kind of relative guarantee. The reason I asked the Attorney General whether or not this 4.5 or 4.6 percent overexpenditure for his ministry was acceptable was simply to find out whether or not we're going to be here again next year with another overexpenditure, perhaps another special warrant that has to be approved after the fact, after the money has already been spent. If that's the case, he should tell us. It really does affect the integrity of this process that we're going through here.

Hon. C. Gabelmann: I can't predict whether or not there's going to be an overrun, a special warrant, next year. Clearly it is my intention that there not be. We intend to manage, to try as best we can to live within this budget. Like most ministers and most ministries, we would all like more because we know all kinds of effective things we could do if we had more money. We don't. Nobody has enough in their budget to do what they want to do.

It's our challenge in our ministry to make every conceivable effort to live within this budget. I hope the crime rate goes down. If the economy continues to improve, then the crime rate will go down. That's an historical truism. But I can't guarantee that.

What I'm saying to the member and to this House is that we have been given a budget by the Minister of Finance. It's our obligation to live within that budget, and I'm going to do my very best to work with the ministry to ensure that we do.

D. Mitchell: I wonder if the Attorney General can just give us some reassurance, then, that this budgetary process that he's engaged in, not only within his ministry but as a member of Treasury Board, is based upon some realistic assumptions. The reason I want to raise this is in part to do with a comment that the minister made this morning in this committee. One of the reasons for the cost overrun, according to the minister this morning in the House, was to do with the Public Service Employee Relations Commission agreement that was brought in on March 27 last year. I'd like to ask about this because it raises a concern.

The minister would have known that these labour negotiations were ongoing at the time he was preparing his budget, yet no accrual seems to have been made for any potential increase in salaries to members of the staff in his ministry, even though it surely must have been anticipated that an increase might be negotiated by the trade union.

The minister's answer this morning, when there was some disbelief expressed about this, indicated that negotiations were going on, that they weren't concluded and that he didn't want to affect the bargaining position with the union and actually bring in an increased estimate. I can understand that, I suppose, and I can understand why he wouldn't want to have shown his hand and why government as an employer couldn't, during a labour negotiation, show that they were actually providing for that.

But somewhere in the budgetary process, does not government or the public service employee relations body make some kind of an accrual for an estimated increase? If that's not the case, how can the estimates that the minister brings to this committee have any credibility -- when built right into the process is an underaccrual or the not making of a provision for these kinds of increased labour costs since they were going up anyway?

[3:00]

Hon. C. Gabelmann: These costs are as a result of an evaluation -- reclassification -- process that was agreed to on March 27 last, after the budget had been set. That process took place over the course of the first part of this fiscal year that we're just concluding, and I think it was in the fall that an agreement was reached, which led then to these numbers being produced. So the collective bargaining agreement between PSERC and the BCGEU concluded on March 27 last year. It was not until then that the ministry knew there would be an agreement which could lead to additional costs. So that is what happened.

The Chair: Just before I recognize you, member, it seems to me that we have canvassed this subset of warrant 2 rather extensively, and given that we will have an opportunity to look at vote 17 in extenso at some later time, I am going to caution you to perhaps curtail your remarks somewhat so we can move on to other members' questions.

D. Mitchell: I have no desire to dominate discussion here. I'll be glad to give way to other members if they have questions, but at the same time we are here to understand why the Ministry of Attorney General is overextended on vote 17. In this particular case, there was an evaluation that the minister says took place that resulted in an unanticipated expenditure of close to $5 million because of the evaluation process.

Before granting supply retroactively to the minister, I think it is important for members of this committee to understand the details that led him to come here today to ask for several million dollars more for his budget. He has spent it already; it has been spent. It will have been completely spent by tomorrow, by the end of this fiscal year. So, hon. Chair, I hope you will indulge members of the committee to do their job and try to find out a little bit more about this.

On the issue of this evaluation, I know the Attorney General isn't responsible for PSERC, but perhaps he could tell us just a little bit more about how a decision like that might affect the budget for his ministry. Because PSERC comes up with an evaluation that results in an expenditure of $5 million.... Was that completely unanticipated in the process of the budget being drawn up for his ministry as it was being brought through the Treasury Board process? Was it not possible to anticipate that in any way? Was this evaluation totally out of the blue, or is this not some part of some process that can actually be anticipated, as it seems to be done oftentimes in other ministries?

Hon. C. Gabelmann: These are really questions that should go to the Minister of Finance, but let me do the best I

[ Page 13150 ]

can. I can't answer it completely, but the negotiations between PSERC and the BCGEU were coming to their final stages at the same time as the budget was being prepared. The budget was prepared before this item was drawn to our attention as being on the table and then agreed to. In other words, the job evaluation and reclassification scheme in Corrections was one of the items that enabled a deal to be made at the bargaining table. That wasn't known to the ministry when they were preparing a budget, and they had no way of anticipating that that would be on the table.

D. Symons: I have just a few questions on this topic also. I might draw to the attention of the minister or the previous speaker that when we look at the 4.6 percent increase on the amount that you are asking for through special warrants, it doesn't seem very much on the total operation of vote 17. However, when you take a look at that $33 million figure, according to the lines in, particularly ministry operations, where these increases are needed, it becomes quite substantial. So I think the 4.6 percent is reasonable for the whole ministry operations, but it is only affecting certain lines in here.

I also had some concerns about the numbers. I find if I look in last year's book -- and indeed it is here for our votes that we did last year.... You mention in the special warrant that the vote last year was some $731 million. Then you are asking for this extra amount of $33,618,000. But if I take a look at this year's estimates books, and vote 17 becomes vote 18 this year, I find the total voted expenditures for '94 and '95 -- and I assume that this is the corrected one -- is $734,540,457.

So I am wondering if the minister might explain then that we have a figure on the special warrant other than what the supposed expenditures for that ministry were. In other words, what I am concerned about is that you are not only asking for the $33 million special warrant now, but we seem to have overspent by another $3 million, according to what was approved last year.

The Chair: Certainly, member, I'm going to allow the minister to respond and to try to clarify it, but it does seem to me that we are deviating a little from what the special warrant.... The only item before us is the specific sum of money under that special warrant. However, with that caution, Mr. Attorney.

Hon. C. Gabelmann: I thank the member very much for giving the advance notice of an estimates question which I will answer thoroughly in the estimates debate.

D. Symons: I thank the minister for the non-answer, but I was basically trying to find out whether this $33 million special warrant is indeed the correct figure, since the figure given in your own books for this year seems to be different from what you said we approved last year. There seemed to be another $3 million in limbo. I suppose if you're not able to answer at this time, I will save that till later in the session.

You mentioned earlier the figure about double-bunking. I just have some concern that we have had some unfortunate incidents happen as far as security of personnel, particularly prisoners in the jail system, when they are double-bunked. What precautions are you taking in order that that won't happen? In order to keep the construction costs down you're double-bunking, but at the same time I think it puts prisoners at risk. What contingencies are you putting in place to see that we don't have any more unfortunate incidents?

Hon. C. Gabelmann: The unfortunate incident that occurred last year was as a result of an inappropriate placing: two inmates who should not have been in the same cell. There are policies in place to ensure that inappropriate matching will not occur in the future. You can never guarantee that there will be no incidents in the jail system, but we are doing everything we can to ensure that we minimize the potential for those kinds of incidents.

D. Symons: I have just one final question. I listened intently when you were giving the response to the question about the extra amount needed because of the social service tax, and I had some difficulty in understanding. Maybe the minister might explain it in a different way so that it would become clear to me. I understand from your answer that before we had lawyers doing social service and, I suppose, legal work on contract. I suspect that when you are paying those lawyers for their services, they would be paid and the fee they charge, the social service one, would be remitted back to the Crown.

Once those lawyers are brought into the civil service, as you implied happened during the year, would not that same social service tax, now that they're part of it, still be part of the equation? I can't see how it makes much difference whether they're part of the Crown or part of a contracted-out arrangement; that amount is still due, and it shouldn't have made any difference either way.

Hon. C. Gabelmann: Social service tax is not paid on salaries paid to public servants, so there's no tax to collect if people are on salary. However, if you contract out, as we do occasionally to ad hoc lawyers, those ad hoc lawyers who bill the government pay a social service tax on that particular billing.

D. Symons: Now I'm even more confused as to why you need more money for the social service tax if you have lawyers that are now brought onto the government's payroll rather than being contracted out. I understood that's what had happened during that year. The minister is shaking his head, so he's going to correct me on this.

Hon. C. Gabelmann: I'm just going to try to say what I said earlier: $600,000 was incurred early on in this past fiscal year, the one that's almost closed, because the transition from contract to employee status had not been completed as quickly as we had hoped. Right? So this is not a continuing expense.

K. Jones: I'd like to follow up on that social service tax aspect of it. Could the Attorney General tell us exactly how much money was included in the pay-out of social service tax for legal fees by the ministry?

Hon. C. Gabelmann: It was $600,000.

K. Jones: Six hundred thousand dollars was paid by a ministry and charged by the government to itself. Why isn't the government exempt -- as most government agencies are -- from paying social services tax?

Hon. C. Gabelmann: In dealing with the Crown criminal justice branch, the lawyers I was referring to were independent contractors: private lawyers who were contracted to provide a service to the government. When they put their billing in -- as they would if they were working for a corporation -- that billing is subject to the social service tax as a result of the policies of the Minister of Finance.

K. Jones: The minister knew in advance that he was going to be contracting services, yet he puts the social service

[ Page 13151 ]

tax in here as a reason why he's over budget. Why would he be over budget when he knew he was going to be having these contracted people? For what reason is there a charge of taxation for people doing work -- whether it's contracted or not -- to the government?

Hon. C. Gabelmann: If the government buys a fridge.... That's a poor example. I won't do it by analogy -- I should have learned long ago not to do it by analogy.

The fact is we have $600,000 in this special warrant because the transition from private sector lawyers to government lawyers doing the work took longer than we expected. It was not completed until part way through this fiscal year.

K. Jones: In this vote 17 for ministry operations, could the minister tell us just how much money was spent on investigation, policing and enforcement of the 10,000 illegal video lottery terminals -- VLTs -- that the Premier claimed existed in the province last fall when he announced the gaming policy?

Hon. C. Gabelmann: The Attorney General neither directs the police as to what policing priorities they should have in specific investigations nor do we -- nor I suspect do the police -- keep track of that kind of specific detail. Let me just say one more thing. The member could determine the answer to this question by talking to the various police forces and asking them how many people might work in that particular detachment or municipality on the vice squad, for example, and asking how much time the vice squad spends on VLTs as opposed to other activities. That's not something we direct, nor do we keep the information even if it were available.

K. Jones: The minister didn't really listen to what I said. It had nothing to do with the police forces. The question was specifically: how much money was spent from your ministry operations under vote 17 for the policing, enforcement or any other aspect of putting those 10,000 illegal VLTs out of business?

Hon. C. Gabelmann: There are no policing items in this special warrant.

K. Jones: Obviously the minister does not want to answer the question. He must be embarrassed about the fact that he may not have spent one red cent on trying to enforce these so-called illegal video lottery terminals -- the 10,000 the Premier has claimed are out there. Are there really 10,000, Attorney General, or is it just a fallacy? Have you spent one red cent in trying to find them? Have you done any prosecutions whatsoever?

The Chair: I'm certainly going to acknowledge the Attorney General, but I'm having considerable difficulty understanding how this falls under the purview of warrant 2.

[3:15]

Hon. C. Gabelmann: Not one penny in this warrant was spent on that initiative.

L. Fox: I just have a few questions, primarily because I'm concerned about the principle of overexpenditure. This morning, around the one issue when we talked about the PSERC and BCGEU allotment of $5 million that was contained within this special warrant, the Attorney General suggested that he didn't want to tip his hat as to what in fact might be available and influence the negotiations. I'm concerned, though, about that principle.

What we've done in reverse, it would appear to me, is say to those who are bargaining on our behalf, as well as those who are bargaining on behalf of the respective unions, that this government is prepared to go to special warrant in order to cover whatever we negotiate. So the ability to pay is not an important factor here. That is the underlying concern I have with this approach to it. It would seem to me, given that the negotiations would have.... There should have been some ability prior to budget day last year, which was, as I recall, somewhere around March 21 or 22....

The Attorney General would have had some idea as to what the expectations were out there on both sides and approximately where the costs might come. In fact, you could have included a sum of money within your respective category that may not have had to suggest one line for this agreement settlement but an overall cost that would be reflected within that category in your budget.

I want to say that I was pleased with the message sent by the Education minister when he announced what his budget was. He was straightforward in saying that there's no allotment for an increase in teachers' salaries. That sends an important message to those who are negotiating on behalf of the respective bodies. I would like the Attorney General to respond to that, if he would.

Hon. C. Gabelmann: The member makes a fair point. Clearly, in budgeting, if you anticipate that a collective bargaining will result in a pay increase across the board or of some kind, you find a way of budgeting for that without signalling that you've done so. Clearly that's something that governments have to think about.

This item, however, was not for a pay increase, although it resulted, obviously, in some individuals earning more money. But it wasn't a pay increase as we understand it; it was a reclassification. The ministry had no idea at the time of the budget preparation -- the budget-setting -- that it would be on the table as an item that might be agreed to, so it was completely unanticipated. It was one of the issues that helped to resolve the bargaining.

L. Fox: I understood what was being negotiated, but I would have hoped that PSERC, in negotiating that, would have been doing a cost analysis of what some of their changes would be during that process so that they would know, when they signed it off, what the costs were. I would assume, then, that the principle would be the same -- whether it was negotiations for a straight salary increase or negotiations for a restructuring of the ministry and a realignment of categories -- and that the negotiator would have some idea as to what the costs were.

So I just caution the Attorney General, because I think we have to send the message out to those at the bargaining table that the ability to pay is a very important factor. It has to be considered by all parties during negotiations, and the issuing of special warrants to cover off those costs is very much a principle that I wouldn't want to see continued because I think it sends the wrong message to all parties. I'll leave it at that.

I want to go just a little, though, into the $600,000 that was spent to cover off the social service tax portion contained here. It seems to me that it would have been a very easy process to take the previous year's expenditures under contract and multiply those by the 7 percent that applied to social services at the time this government brought in the legislation which forced that social service tax to be paid by the legal profession. It seems to me that one could have done a fairly accurate estimate as to what those costs would be.

[ Page 13152 ]

As I understand the discussion so far this afternoon, the $600,000 that is identified in warrant 2 under vote 17 is in fact the total cost of social services tax to the AG's ministry for last year and is not just an overexpenditure of costs. Maybe I would allow the Attorney General to clarify that for me, but that is what I got out of the discussion.

Hon. C. Gabelmann: Some ad hoc lawyers are retained on occasion by the ministry. Those people bill for social service tax, and that money is paid out of the regular budget. That's not what's on the table here.

What's up for discussion is the $600,000 that comes as a result of the conclusion of the discussions between the ministry and the Crown Counsel Association -- which Vince Ready was involved in as well -- that led to an orderly conversion from a contractor system to an in-house system. I should say that the agreement to establish a timetable which extended into the fiscal year didn't occur until the budget was being produced, in anticipation that the conversion would conclude by March 31 and therefore no moneys would be needed for this purpose in the fiscal year.

The negotiations discussion led to an orderly transfer or transition in what had been a very complicated matter. There's a huge tax exposure for lawyers in the transition year -- paying double, in effect, in that particular year -- so there was a complicated transition process, which from all accounts went very, very smoothly. We should be proud about the way that transition occurred because it did go smoothly. But it required some additional months into this fiscal year, which we had not anticipated would be required when the budget was drawn up.

L. Fox: So that I might understand the magnitude of the $600,000 and what the percentage of overrun was, could the Attorney General tell me what percentage the actual cost -- the $600,000 -- was, in terms of just social service tax cost?

Hon. C. Gabelmann: I'm going to ask the member if he'll help me be more precise about the question. Is the member asking how much money was paid out to contracted Crown? No?

L. Fox: I'll try to clarify it. Maybe I wasn't specific enough.

The Attorney General, if I understood him correctly, suggested that the transition took several months longer than anticipated and that the $600,000 that was due to social services tax was created because of that longer transition. I would assume from this that other dollars were paid throughout the year and in the regular vote to social service tax. So that I can understand the magnitude of this overrun, my question is: what percentage is the $600,000 of the total tax that was paid throughout the year by the ministry?

Hon. C. Gabelmann: I'm not trying to evade the question. We will get those answers for the estimates debate. It's probably properly an estimates question, in any event, because it deals with the budget that was approved.

If the member is asking me the total amount of money that the Ministry of Attorney General remitted to the Minister of Finance dealing with social service tax, I'll try and get that. If he's asking me something else, I'll have to listen more carefully.

L. Fox: One more time. I'm not trying to be difficult, hon. Chair. What I'm trying to understand is the percentage of overrun with this $600,000. For instance, if there was a $6 million payment from your ministry to social service tax, then I would know that this is a 10 percent overrun. That's what I'm trying to understand. I have no idea what the total cost was and what the percentage of overrun is.

Hon. C. Gabelmann: I'm going to try to make sure I give a precise answer to the question when we're in estimates. I think this is a bigger number than the combined total of all the rest of the money that is paid for social service tax out of our ministry. This is the majority of it for this fiscal year. But I don't know whether the remainder is $200,000, $300,000 or $400,000. I don't know how much, but it's that kind of magnitude. I will try to get a precise answer in estimates.

L. Fox: Thank you very much. That's the kind of direction I was looking for. Then it would seem to me that perhaps we could have done more homework in preparation of the budget and the estimates last year and in estimating if, in fact, this is a larger portion of the budget. But I'll leave it. I'm not going to carry it on; I've tried to make my point.

Let me go back to one or two other questions. In the draft this morning, the Attorney General talks about $300,000 that was spent for the cleanup of primarily the Coquihalla -- sorry, I mean Oakalla; we talked so much about the Coquihalla -- and one or two other smaller sites. I want to ask a couple of specific questions: whether or not that concludes the cleanup of the site, and if the Attorney General is in a position to tell us -- and he may not be -- what process we had to go through in order to expend those dollars.

Did it mean hauling gravel, dirt or whatever, or did we just place it in another spot in the area as we seem to be doing presently with the old Expo site? I'd like to know if that's the end of the expenditures that we can expect with Oakalla.

[3:30]

Hon. C. Gabelmann: The answer to the first question is that that's it; it's complete.

The answer to the second question is interesting. One of the significant things that had to be done to clean up the site was to deal with well-preserved 40-year-old pigs. In the fifties, as members will remember, Oakalla was a thriving farm, and the inmates would do a variety of activities to make money for the prison, including a very interesting pig farm operation. During that time I guess they decided to get out of the pig farming business, and they did away with the pigs. In the burial ground they covered them with plastic.

In the cleanup, the plastic was removed to discover hundreds of very well preserved pigs -- mummified, you might say. Some considerable work came as a result of that kind of environmental problem remaining. There were other issues: a sawmill had operated on that site at one point, and there were cleanup costs related to that. They would be the normal kinds of other contaminants that may be left over from what had been a working farm and, in some ways, an industrial site.

L. Fox: Just one final question. I found it somewhat surprising that $300,000 had to come out of your ministry and your estimates rather than out of BCBC which was, as I understand it, the manager of the site. Does the Attorney General expect that he's going to achieve these dollars back through the development stages of those lands? Who is going to gain the benefits of those?

Hon. C. Gabelmann: I don't want to open up a debate in this House about a debate that goes on at the staff level between BCBC and the ministry. During the course of the year a decision was made that those particular environmental

[ Page 13153 ]

cleanup costs should be paid for by the AG's ministry. I think a very compelling case can be made that it should be a BCBC cost, and that it should be recovered from any results they achieve from the sale of the property. However, that's not what happened. The decision was made during the course of the year that this would be an AG cost, and we've had to eat it.

D. Mitchell: I just have one other area I'd like to canvass under this vote. It's a question about the unexpected expenditures that the Attorney General has referred to. Last year I would expect that one of the unanticipated expenditures was relating to a commission of inquiry that the minister agreed to hold into the corrections system: the Prowse inquiry into the Danny Perrault case. Would it be correct to assume that part of this overexpenditure that we're being asked to approve today with special warrant 2 relates to the cost of the Prowse inquiry?

Hon. C. Gabelmann: No, that's a statutory expenditure, and as the member knows, statutory expenditures do not get reflected in warrants.

D. Mitchell: Then I would like to ask the Attorney General whether or not the tightening of corrections procedures that he announced last year, coincidental with the Prowse inquiry.... At the time there was heightened public concern about confidence in our corrections system. Were the tightened procedures that he announced at that time, including a special office within his office dealing with complaints or appeals...? Were those costs part of the increased costs leading to the cost overruns in the Ministry of Attorney General's estimates?

Hon. C. Gabelmann: The cost of the standards investigation branch -- or whatever it's called now -- which reports directly to me, is not significant. I think there's one additional full-time equivalent position added to that. The real costs come from the climate that arose as a result of matters that Madam Justice Prowse was looking into. I think it's fair to say that the system responded by being exceedingly careful, and whenever you are responding in that way, it's going to cost more than it does if you take the odd chance.

D. Mitchell: What I'd like to know is: is it possible that the minister or his staff has measured the increased costs associated with the tightening up of procedures, or the setting up of the inspection and standards office that reports to the minister? And how much of the costs associated with those extra measures is reflected in the special warrant for $33,618,000 that we're being asked to approve here today. Has a portion of it been measured, and can he tell us how much that is?

Hon. C. Gabelmann: I don't think we have the capacity to put numbers to that.

J. Tyabji: We're being so polite today; what a refreshing change.

To the Attorney General: with respect to the Oakalla environmental cleanup, what was subsequently done with the land on which this cleanup occurred?

Hon. C. Gabelmann: That's really a question for the minister responsible for the B.C. Buildings Corporation. I don't know the status at the present time.

J. Tyabji: What I'm getting at is that in his first comments the Attorney General mentioned that perhaps the payments for the environmental cleanup at Oakalla and the Terrace correctional facility should have been done through BCBC or through another line ministry. As I understand it, the land was subsequently sold to private developers. I was wondering if the Attorney General ever explored a private investment cleanup of that land instead of it coming through his ministry.

Hon. C. Gabelmann: Our ministry wasn't involved in or responsible for the cleanup; that was BCBC. The only involvement we had was that they made us pay for it.

J. Tyabji: If the Attorney General is saying that the only way he was involved was for it to be cleaned up, would he not then at least have asked if there had been another avenue for that to be cleaned up before paying for it? Or is he saying it's a statutory obligation? I don't understand.

Hon. C. Gabelmann: The land was owned by BCBC. Everything to do with the land was done by BCBC, except that we pay. As we do for a building that we may rent from BCBC, we pay building occupancy charges. We pay a fee to BCBC for its fair market price. We are like a tenant in a tenant-landlord relationship with them, so in this case they did what they had to do, however they do it. The member can talk to the minister responsible to find out why and how they did it, but the only involvement we had was that we were no longer a tenant, so we had nothing to do with the place. But when the bills came in, a decision was made that some part of that bill would be sent to our ministry.

J. Tyabji: I will definitely be taking it up with BCBC, but my point to the Attorney General, since it was NDP legislation which brought in the amendments to the Waste Management Act that then put tenants liable, is that there are many examples in the province right now where environmental cleanup has actually been paid for by the incoming tenant or the incoming owner. Although I'll take it up with the other minister, I think that's something to explore for the province. If the land is going to be privately developed, why would they not pass on the cost -- other than to the Attorney General in a cost overrun -- to a private developer?

In addition to that, I'd like to ask about the social service tax for legal services -- the $600,000 paid to the Minister of Finance. Is that the tax brought in by legislation by this government a couple of sessions ago that is now being paid?

Hon. C. Gabelmann: Yes.

J. Tyabji: Has there been any exploration by the Attorney General, since we are talking about three separate ministries of the same government, so that that would somehow be forgiven for the Attorney General?

Hon. C. Gabelmann: If the question was whether there has been discussion, the answer is yes.

J. Tyabji: Has there been any discussion that would try to pre-empt this special warrant and the costs associated with it? If so, obviously they haven't been fruitful enough for this $600,000 cost. Was that what the discussion was for?

Hon. C. Gabelmann: The discussions were about the principle of whether the social service tax should be collected when it is remitted directly to the Minister of Finance.

L. Fox: I'll try not to belabour the issues too much longer; I just have one other question. As an observation, I find this process somewhat similar to what I experienced on council

[ Page 13154 ]

when I was a mayor, in that we would allow the large expenditures to go through without much detail but we'd spend hours on the little ones, so I'm used to this process.

I do have a couple of questions around legal aid, which was about $5 million overexpended, as I understand it. In his opening statements -- or perhaps it was in dialogue with the opposition -- the minister made reference to the fact that it's very hard to identify what your costs are going to be on a year-to-year basis, because there are so many contributing factors out there. A very important one is the economics of the province and therefore of the people. I don't have any difficulty understanding why there's a rise in costs.

Given the fact that there are 100,000 more people on welfare over the last couple of years, you would expect that your legal aid costs are going to increase. So I recognize that there's only limited opportunity within the AG's ministry to deal with that -- in fact, it requires the government as a whole.

But I am concerned about the fact that it appears, and I get more and.... The Attorney General and I have discussed in debate over the course of the last couple of years how legal aid is being used. We see more and more instances where legal aid is being used to prosecute others rather than defending their rights.

In fact, I have a case that I brought with me -- and I have a number of these -- where the individual is a single mother earning a little over $18,000 a year who doesn't qualify for legal aid. But her spouse from whom she has been separated for a couple of years -- he was an alcoholic and so on, which caused the separation -- is now able to use legal aid against this single mother, causing her great financial difficulties.

That concerns me because I see the incidence of that rising, and I'm very confident that it has also led to some of the overexpenditures in legal aid. That's the reason I bring it up at this time. I'm not wishing to canvass the whole estimate, but can the Attorney General tell me whether those kinds of circumstances are being looked at in his overall review of the legal aid system? I know it's a difficult issue around protecting one's rights and one's ability to defend their rights, but I look forward to the Attorney General's comments.

Hon. C. Gabelmann: Under the statute that establishes the Legal Services Society, decision-making about eligibility and what not is theirs. I'm not able, as the Attorney General, to direct them. I really only have three ways of dealing with the Legal Services Society. One is by appointment of some members of the board, another is by legislation and the third is by how much money we give them. That's the extent of my ability other than just discussion and persuasion. So those are issues that the independent board has to deal with.

[3:45]

There's no question that I've had correspondence similar to the reference the member made. I think the longer-term, partial solution to this problem is to move away from the adversarial system in family matters. We're never going to be able to eliminate the opportunity to go to court. There are situations, power imbalances and times when court is appropriate. If we can move more to mediation and get these systems out of the adversarial court, then family, society and the taxpayer are going to be better off.

That is partly what we are trying to accomplish through the pilot projects in the family justice area I referred to this morning. It won't be the ultimate answer, but it's hopefully a significant part of it. I can't really say very much more about it in terms of the eligibility. I will just say to the member that I recognize the problem he outlines.

J. Tyabji: On the same subject of the Legal Services Society overrun of $5 million, the Attorney General has said that this is the transition period toward a mixed model. Where is the accountability on the part of the Legal Services Society for the extra $5 million plus whatever other money was provided to them for the transition period?

Hon. C. Gabelmann: This is the only money being provided to them in addition to their regular allocation, which I think was $85 million last year. None of this money can be used for regular operational needs. It can be used only for the transition issues. The accountability comes from the fact that we won't issue the cheques unless they can demonstrate to us that the money is in fact going for transition purposes.

J. Tyabji: Was the $5 million paid out as it was expended? There was money sent in, and there were receipts sent in which were reimbursed?

Hon. C. Gabelmann: It's not done on the basis of receipts. It's a demonstration that this was the amount they required during the fiscal year to proceed as far as they have proceeded with the transition to a mixed model. That demonstration of cost was made in extensive discussions between the LSS financial people and our financial people.

J. Tyabji: I'm not sure if that answers the accountability question, but I see that this is the process which is in place.

The most important issue and the last one I want to raise on this special warrant is with respect to overcrowding and double-bunking, and the fact that double-bunking is in violation of a United Nations covenant. The Attorney General mentioned that. What I find interesting is that when the Attorney General mentioned that British Columbia under an NDP government is in violation of a United Nations covenant, he said that this causes him some concern and is something that should probably be dealt with, but that this is where some of the cost overruns came in.

I thank the Attorney General for the statistics I asked for about the growth and demand on the correctional institutions. We can see a steady upward trend in the demands being placed on our correctional institutions. In the last few months, we know that there has been a series of breakouts, and public confidence has probably never been so low in terms of their feeling that these correctional facilities are going to be able to meet the needs of society as a whole. I'm not convinced that this special warrant has addressed the situation in the best possible way.

The Attorney General has mentioned specific costs of overcrowding. I have to look through my notes to see what the exact information was. It's $8.9 million adult and $3.5 million youth overruns. What is that cost? What does the Attorney General do with those remanded or convicted people to incur the costs?

Hon. C. Gabelmann: Most of the money goes to additional staff who are required to supervise the additional inmate population. I understand that the additional staff is somewhere around 170 in this fiscal year.

J. Tyabji: If we have 170 additional staff I'm not sure that that addresses roughly $12.5 million in costs, unless they're very well paid. I'm not sure if the Attorney General is also talking about some capital costs.

As the Attorney General is aware, in Winfield, for example, there is a proposal for a correctional facility. I understand that some of the plans for correctional facilities in Port Coquitlam are also underway. To what extent are these overruns also some of the asset acquisition or plans for those

[ Page 13155 ]

correctional facilities? The Attorney General is saying: "No, that's not what it's for." I'm still not clear how $12.5 million goes toward 170 staff, or if there are capital costs as well.

Hon. C. Gabelmann: I'd like the member not to hold me to the precise number. We haven't had a chance to be precise about it, but it's somewhere around $8.5 or $9 million for staff costs. The additional costs come from food and clothing and all the things that are required to look after prisoners.

J. Tyabji: For the record, how do we define "double-bunking"?

Hon. C. Gabelmann: Two places to sleep in one cell is the best way I can put it.

J. Tyabji: So currently, when the Attorney General is referring to double-bunking in the correctional facilities, is he saying that there are going to be two people sharing a cell or two people sharing the same sleeping area?

Hon. C. Gabelmann: Two people in a cell. Keep in mind that these cells are pretty small. There are separate mattresses or separate sleeping areas, but there are two people in a cell designed to house one person.

J. Tyabji: So none of the expenditures in the overruns were to deal with that specific aspect of double-bunking; it was just to have the people there to oversee the people and the overcrowding issue wasn't dealt with at all.

Hon. C. Gabelmann: Some portion of this money, the $8.9 million and the $3.5 million -- totalling $12.4 million, if my arithmetic's correct -- is for costs attributable to any construction required to create another sleeping area within one cell and issues of that kind. Most of those costs are not in the overrun; they are costs we have incurred in the budget debated last year and the previous year in the House.

J. Tyabji: I recognize that I can't go any further with that line of questioning in this debate, so I will be going back to it in the Attorney General estimates.

The last thing is that I was out of the House for a little while, and I'm not sure if they canvassed the re-evaluation of correctional physicians. They did. Okay. I'll review the Hansard.

On warrant 3.

J. Dalton: I believe that the Attorney General commented that the disclosure courts have been increased from two to seven. I presume that that would account for a large part of this increase we see in the special warrant of $420,000, on top of a budget of $33 million and change.

There is a particular question I would like to ask of the Attorney General. It may not be appropriate for here; if not, he'll defer it to the estimates himself. Are there any provisions in this special warrant for Provincial Court judges who are on leave -- sick leave, for example, or other absences?

Hon. C. Gabelmann: Not in this special warrant.

J. Dalton: Perhaps if I can just ensure that.... Is that $420,000 figure essentially the cost of salaries for these extra judges?

Hon. C. Gabelmann: I can provide a breakdown of the almost $420,000. Of that, $296,000 was for the salaries of five Provincial Court judges as of October 1. During the course of the year, Treasury Board enabled me to add to the Provincial Court complement, and that cost just short of $300,000 for this fiscal year. The other $125,000 comes from a very small amount for support staff, benefits for the judges and other operating costs.

L. Fox: I have just a couple of very brief questions, because $420,000 isn't a large overrun. Given the situation today, where we have large waiting lists to get before a judge and we see crammed remand centres around the province where individuals are waiting for a court day, which of course adds to the costs of running those respective institutions, can the minister tell us just what action he's taken with respect to those lists and those wait times, and how this $420,000 facilitated reducing them?

Hon. C. Gabelmann: The $420,000 was designed to deal with the Provincial Court backlog, which I acknowledge is a serious problem. We have been involved in other initiatives -- which again we can talk about during estimates -- that are not included in this warrant and that we've done within the regular budget of the ministry to try to deal with the fact that we have a serious problem. The only thing this warrant does is pay for the cost of adding five judges. Any discussion beyond that really should wait until the estimates discussion.

L. Fox: Around this cost, can the Attorney General tell us whether he has instructed the Crown counsel, for instance -- because of the rising costs and the overruns -- to seek opportunities of negotiating agreements outside of the court, as a way of reducing the demand on the Provincial Court system?

Hon. C. Gabelmann: First of all, I need to say I have not given any directions to Crown in this regard. Crown operates without direction from me. If I do direct, I would do it in writing, and the member would know about it.

However, Crown on its own has initiated a number of programs to try to deal with the backlog, including in particular a case review team. It takes a small number of senior, experienced Crown counsel to review cases in the system to see whether those cases can be dealt with more expeditiously. That is part of an overall initiative, and it's producing good results in this early going.

[4:00]

On warrant 4.

J. Dalton: This one.... Even though in a way we are revisiting something -- I see that two years ago we dealt with a similar cost overrun in this vote dealing with emergency response and preparedness.... That is where, as I commented this morning, the Attorney General at that time said that we should just consider this like a C.D. Howe treatment: what's a million? But I'm hoping we won't treat it that way.

Can the Attorney General explain to this committee why such a significant cost overrun has occurred? There is a 25 percent increase in this particular vote from the allotted figure that we dealt with in the estimates of $993,500. We are now adding another $250,000. I am hopeful that the Attorney General will be able to give us an explanation as to that.

[H. Giesbrecht in the chair.]

Hon. C. Gabelmann: The answer, basically, is that there was a 20 percent increase in this last year in the number of emergency incidents that the province responded to,

includ-

[ Page 13156 ]

ing search and rescues, auto extrications, dangerous goods spills and the provision of emergency food and shelter. It is very difficult to predict how many emergency incidents are going to occur. We put a number in the budget that was our best guess, and we underestimated by 20 percent the number of incidents. Hopefully, we won't again, but who knows what the situation will be this year?

J. Dalton: As a follow-up question, does this figure also include any particular funding for earthquake preparedness? There have been some interesting initiatives at the community level in that area. Has the Attorney General provided funding through this special warrant for that particular thing? It is happily not an immediate emergency, but it very well may be the big one that we all have to prepare for.

Hon. C. Gabelmann: The moneys that would be expended to deal with the issues the member raises would be in vote 17. This is only emergency response.

G. Wilson: I was tempted to say that this is one instance where I certainly can't offer any blame to the minister for overexpenditure, because trying to predict emergencies is a little bit like trying to predict the number of leaks that may arise. I thought, well, that would be a cheap shot, so I won't say it -- although having done so, I guess I'm guilty already.

I have two very quick questions on this. With respect to the $250,000, did that expenditure of dollars relate to the incidents at the Apex Resort and the response to an emergency in that sense, or are we talking only about provincial emergencies and natural disasters in this question?

Hon. C. Gabelmann: The answer in respect to Apex is no; this program doesn't deal with that kind of situation.

G. Wilson: Secondly, then, if we are only talking about the PEP program -- essentially, emergency response preparedness for what effectively are natural disasters or the actions of natural disasters -- can the minister tell us how much of that money may have been saved or should have been saved or could possibly have been saved if there had been an agreement between the federal and provincial governments with respect to the provision of service through the Armed Forces bases that exist in the province? I raise this matter specifically on the issue of the Chilliwack base.

It clearly would seem that given that we have increased costs to the taxpayers of the province, this -- albeit not a huge sum of money -- would be an excellent opening for the government to talk about the need to maintain the Chilliwack base with respect to the provincial emergency program and funding for that. I wonder if the minister might comment on that.

Hon. C. Gabelmann: I actually can't comment with any knowledge base on how much assistance could be provided by the Armed Forces instead of having to rely on our own program. In that sense, I don't know what the cost of CFB Chilliwack is, but we're talking here about a total budget of around $1.25 million, so it's not.... I don't want to get into the C.D. Howe situation, but it's not much in comparison to the cost of the army base. The kind of work PEP does in these situations is highly specialized, and the experience they gain in one incident stands them in good stead in the next.

Beyond that, I don't think I'd want to make a link between this program and an argument in favour of retaining the army base.

On warrant 5.

Hon. C. Gabelmann: I wonder if members of the House would be kind enough to give us a couple of minutes while we wait for the Minister of Education. I don't think he had any idea when this might end, so I'm sure he'll be along shortly.

The House recessed from 4:05 p.m. to 4:07 p.m.

L. Reid: I'm pleased to rise in debate on interim supply for the Ministry of Education. My questions will revolve around measurement in terms of projection and forecasting. I appreciate that there was an unanticipated 0.6 percent additional increase in public school enrolments, but I'm simply interested in the mechanism of forecasting public school enrolments in the province. Could the minister spend a few moments outlining that process? I trust that overruns will always be part of the process. I'm interested in the value of this particular overrun, and whether it's possible for us to get a better handle on projecting student enrolment.

Hon. A. Charbonneau: Each district is responsible for making projections for its enrolment, and all those projections are forwarded to the ministry. This includes the public schools and the independent schools that are funded, group 1 and group 2. All that information comes in, and in conjunction with the Ministry of Finance, this ministry looks at the projection figures and tries to make a best estimate of what the following enrolment year might be. There is always some uncertainty, of course, inasmuch as we do not know how many families may move to British Columbia or into a specific district.

In this instance, as you have pointed out, the best estimates that had been arrived at between the ministry and the Ministry of Finance fell short by about 0.6 percent. On the other hand, in the independent schools it turned out that we had overestimated the enrolment just a bit, and that helped offset the total cost of the enrolment increase.

L. Reid: I appreciate that each district currently has responsibility for making those projections. My question was specifically: what are the criteria the ministry would put in place that they could base those projections on?" Otherwise, if 75 school districts are making their best guess, surely the ministry has a framework that you ask them to comply with in terms of what that best guess might look like. Could the minister kindly comment?

Hon. A. Charbonneau: Again to the member opposite, as I've just indicated, the boards themselves -- each of the 75 -- come up with their enrolment projections. I'm informed that they are assisted, in turn, by some overall population projections on a regional basis and perhaps a district basis, which Finance, I believe, obtains and distributes. So we try to provide them with a little bit of guesswork, if you will, as to what the projections over the next several years will be. They look at that. They, knowing their community, make some adjustments and some projections. They feed those numbers back.

Then we sit down again with Finance to come up with the number that will be used for the budget process.

L. Reid: Let me take a minute and tell you what happens in my school district, which I am intensely proud of. They base their projections on postal code, based on who receives a family allowance cheque in this province. So they can tell you on any day of the week how many five-year-olds, how many six-year-olds or how many seven-year-olds there are. Is there some continuity around that kind of programming for the rest of the province? I would hope that each school district has some mechanism or framework in place.

What I'm hearing is that you allow 75 school districts to provide their best estimate. What I want to know is: what

[ Page 13157 ]

mechanism do you ask them to use? What I'm hearing, which I think is somewhat alarming, is that there isn't a mechanism. They come with their best guess; the ministry sits down and massages their best guess. Perhaps it would be more prudent to have one system so we're comparing apples and apples as we compare how the 75 school districts come to grips with a projection.

Hon. A. Charbonneau: We do not dictate to all the districts how they come up with their precise estimate. But keep in mind, hon. member, that when the actual numbers come in on September 30, of course, they are funded for the actual number of students they have. And to have an estimate for a population of over 600,000 students that is correct to within 0.6 percent isn't bad. As you know from the budget debate of the past few days, we have had a rather dramatically increasing population in British Columbia.

So it's not unsurprising that districts, at the end of this process and through no fault of anybody's, have underestimated the number of students that have shown up on the schoolhouse doorstep at the beginning of September. They do their best job in advising me beforehand -- probably six months beforehand -- what that number might be. I do my best job and my officials do their best job in then advising them as to what their finances will be. On September 30 they count noses and report back to me, and I make an adjustment.

To have an adjustment as small as 0.6 percent, I think, indicates that generally speaking the system works pretty well.

[4:15]

L. Reid: I would remind the minister that 0.6 percent actually results in a $16 million cost overrun. I don't believe that to be petty cash at all. I'm not asking the ministry to be dictatorial in any sense. I have simply asked three times: are there guidelines, suggestions or advice you might offer the school districts? This is not about dictatorial behaviour on your part. This is about wanting to know the mechanism. What I'm hearing is that they send in the information and it's massaged. What I'm gleaning from that is that there isn't a mechanism in place.

There isn't a memo that goes out that says: "This is how we would like you to return these numbers to us." If that's the case, I would ask for clarification.

Hon. A. Charbonneau: We do not provide a tightly prescriptive formula or mechanism. If you are suggesting that there may be a way for the centre to give better advice in the way of a framework of some sort that all districts could use, that may well be possible. But during periods of dramatic changes in rates of growth, whether it happens to be rapidly rising or rapidly declining, the chances are that at the end of the day, regardless of what technique you use, there will be a variance from your estimate.

You are correct: by the time we offset the overestimate in the independent school system, which amounted to $16 million, a 0.6 variance is not small. But in the context of a near-$4 billion budget, it's not bad.

L. Reid: The minister made reference to September 30 as being the date on which actual numbers are funded in the school system. I don't take any issue with that practice. I'm wondering how far the discussion has evolved in terms of counting actual numbers at January 30 in the following term. I know there have been discussions -- particularly in fast-growing school districts, of which Richmond absolutely qualifies as one -- where the September 30 numbers are dramatically different from the January 30 numbers, in that a number of students move into the district over the Christmas break.

Could the minister elaborate on the discussion in the ministry, perhaps around the second cutoff for supporting and funding actual numbers.

Hon. A. Charbonneau: The way the system used to work was that there was a midyear adjustment made on a districtwide basis. Although that helped some, it was still unfair in that some districts could have extraordinary growth in a certain catchment area, or two or three catchment areas, but not overall. I've changed that, such that this year they will do the second count in January but they will also do it on a per school basis, such that if the increment is above a certain threshold on a school-by-school basis, the extra costs will be recognized for the district.

L. Reid: For my clarification, is the threshold different for the K-to-7 system than, say, the 8-to-12 system?

Hon. A. Charbonneau: The percentage is the same. The trigger is the same for both elementary and secondary.

L. Reid: This may be somewhat broadly based for the purposes of this discussion, but if I might ask the minister's indulgence, in terms of the new funding formula for public schooling in the province, will there be significant changes around future special warrants as a result of that? Do you anticipate cost overruns being less of a dilemma, in that schools, hopefully, will have more ability to determine their actual costs?

Hon. A. Charbonneau: One thing we should be careful of is that if we're going to have a variance, it's always better from the overall public purse point of view to have a positive variance when we actually do the counts. It would be unfortunate, I believe, to indicate to a school district through the estimates process an excessive number only to have to claw back. From time to time that still happens, and it's necessary. But generally speaking, if we're going to miss our count a bit, I would rather miss it on the low side than on the high side, and then be able to top up funding to districts.

L. Reid: From what I'm hearing, the minister suggests that the new system will indeed be more responsive to the funding needs of individual schools than the previous system and will, in fact, capture the growth in student enrolment in a variety of districts. I would ask the minister to comment.

Hon. A. Charbonneau: Yes, the new funding system, which recognizes the midyear growth on a school-by-school basis, is fairer, more equitable.

L. Fox: If I understand the budgeting process for education, it is that prior to formulating the budget, the ministry takes the estimates provided to it by the districts of what the growth will be in student numbers, and then formulates the budget. Having been a trustee for five years, I've always actually felt kind of proud of the job that they've done in districts in predicting the numbers. It's been pretty accurate, and many of them have been quite ingenious in terms of how they get that number. So I'm not that concerned about the overrun of $16 million, given the growth of the province.

But the question I have to the minister.... Some of the complexity that has entered into the system in recent years has been the change of funding for the school year in the budget versus the government's business year, which is April 1 to March 31. Now we fund school districts 60 percent in one year and 40 percent in another year. In the minister's view, has this change helped predict with accuracy, or has it hindered the opportunity to be more accurate in predicting actual budget costs?

Hon. A. Charbonneau: I'm not sure that it has made a great deal of difference. Shifting to funding the schools on a

[ Page 13158 ]

chool-year basis, such that it meets their logical year-end is, I think, a better system. I'm not certain whether it is that much better or not with respect to the previous system, which I believe was done on a calendar-year basis.

And I would comment on your earlier point that there are many, many trustees out there who are as clever as foxes.

G. Wilson: On March 8, 1995, this minister wrote to the school boards and all school districts: "As I...indicated in November, no district will suffer a negative impact in 1995-96 due to implementation of the new system...." He then goes on to say: "As announced on February 15, 1995, government will continue to target the additional funding for students with special needs and students in aboriginal programs." The same memo talks about rapid population growth and community schools being recognized in terms of the annual allocations.

That is commendable, and I think we can certainly support the intention of the minister with respect to that. I just wonder how much of the $16 million that has come forward was needed to be spent in order to match that commitment. That's the first question. Secondly, is the minister confident, then, that there were no negative impacts on school districts as a result of school increases?

Hon. A. Charbonneau: The additional funding represented in this warrant, which relates to the 0.6 percent underestimate of the enrolment growth that had been funded in the 1994-95 budget would not, in itself, reward or penalize. It would simply be truly recognizing the actual enrolments with which districts will expect to go into their 1995-96 year. So it simply puts them all on the same footing.

G. Wilson: I have here a list of both the 1994-95 and the 1995-96 total estimated provincial funding allocation tables, as well as enrolment tables. Certainly they are consistent with what the minister is describing, so I don't take issue with anything that's being said.

My concern is that we have, I think, in two school districts in the province, net increases in enrolment that were not topped up. Those increases now, as a result of the allocation in this budget year, find them with less money for the same number of FTEs than they had last year. Powell River is one of them. And there's some concern that, if the $16 million was put out, maybe something fell through the cracks, that it wasn't quite as fairly applied as it might have been.

And I wonder what the minister's comments might be with respect to that, because I think Powell River has a very legitimate issue, where they actually have increased enrolments that have not been recognized either in the '94-95 funding or in the allocation announced for this year.

Hon. A. Charbonneau: Again, the funding that the $16.1 million represents is based on actual counts in school districts on September 30. Districts are funded for a variety of things. One, of course, is the number of students, the grade that the students are in, the number of special needs and all of those things. But there is another aspect having to do with facilities, the number of square metres of facilities, and how the facility is represented by the district.

Apparently -- and I will get the detail if you need it -- there were some facilities, some space allocations, if you will, with which there was a difference of opinion between the district and the ministry as to how they had categorized space. Some changes in categories occurred which led to a change in the funding level to Powell River, but it didn't have anything to do with enrolments or special needs children or with any of the other enrolment-driven factors.

[D. Lovick in the chair.]

G. Wilson: I thank the minister for the clarification of his position. The last question I have, then, for the minister is: is there any money left? Can we get some more money into Powell River to top it up so they don't face the kind of crisis...? Out of $16 million, there must be some money left, surely.

[4:30]

Hon. A. Charbonneau: I'm afraid that I must inform the hon. member that the money for last year is long spent, but the funds that Powell River and the other 74 districts have received -- or they have received notification of for their next school year -- have been distributed with as much equity and fairness as I could put into the system. I certainly hope that when you look and compare the per student funding, the per school funding, the per special needs funding and the per special program funding, you will see that, in fact, Powell River is funded identically to the other 74 districts.

On warrant 6.

The Chair: If everybody is agreeable, we'll simply wait for the Minister of Health and have a quiet, informal recess.

T. Perry: While we're waiting, I beg leave to make an introduction. Somewhere in the precincts there may or may not be the Hon. Mobe Haderas. In case he is here, I would like to bid all members make him welcome while we are waiting for the Minister of Health to arrive.

The Chair: I'm fearful of the precedent of "who may or may not be."

I recognize again the member for Vancouver-Little Mountain.

T. Perry: The very beautiful and charming lady in the front row of the members' gallery bids me to ask all hon. members to welcome her to the gallery.

The Chair: The committee is now ready to proceed. I recognize the Minister of Health.

Hon. P. Ramsey: My apologies to the assembly for that slight break in proceedings. This is indeed a very special special warrant, and I'm pleased to begin discussion and explanation of why we are requesting a special warrant in the amount of $135.7 million for the year 1994-95.

With me in the chamber are some officials from my ministry. On my left is Leah Hollins, the executive director of acute care, and on my right is Robert Cronin, ADM for corporate services. Other officials are available if we get into detail on some other areas of the ministry.

I'd like to provide the House with some breakdown of this request so that all members understand that this is not one request but really several, resulting from very different sorts of pressures in different areas of ministry operations. I'll give you some dollar figures off the top, and I'll take it from there.

First, as the special warrant says, we require an increase in the amount designated for fee-for-service medical services in the Medical Services Commission. The total amount in that area is $29.8 million. That is due to a variety of pressures and.... Really, the actual utilization was greater in a number of areas than had been anticipated or allowed for under our

[ Page 13159 ]

initial estimations of what the agreement with the BCMA would require. I'll speak to that in greater detail as we get into it.

Second, there is an amount of $16.4 million in the area of corporate programs. That has some other.... I'll give you a little breakdown of that, because while it may be a small amount overall here, it is composed of several items. In the area of Pharmacare we estimate that expenditures will exceed the amount approved by the Legislature during committee last year by $6.9 million. For emergency health services -- the B.C. Ambulance Service -- we require an additional $4.3 million. Then about $5.2 million are attributable to increased costs for debt servicing and a variety of other minor pressures.

That's in the area of corporate services. The most significant program there that obviously is impacted by this special warrant is Pharmacare. Actually, when we get into it, I will be making the case that having an overrun of only $6.9 million is actually good news, given that the overall level of spending in Pharmacare will actually be lower in 1994-95 than in 1993-94. It must be the first time in at least half a dozen years that we can show a year-over-year decrease in spending on Pharmacare. My colleague from Vancouver-Little Mountain suggests that this is because his colleagues in the physician community are learning about therapeutic medications.

Finally, the special warrant includes an amount of $89.5 million for regional programs. This is broken down into several items that I think the assembly is aware of and perhaps a couple that they are not. First is the additional $50 million to operating budgets for hospitals, which was announced last July. Second is $18.9 million to address various wait-list pressures and to establish a longer-term management agenda and criteria to assure that wait-lists get down and remain down in the medical care system of British Columbia.

There is $11 million for hospital equipment, simply because we could not go on with, in some cases, the antiquated or inadequate equipment that was in place. One other significant item I'd like to highlight is in the area of community programs, the $5.4 million for increased pressures on kidney dialysis. As I think all members know, we have a growing population of people availing themselves of kidney dialysis, many of whom are waiting for transplants. Unfortunately, the alternative to transplants is dialysis, and it is quite expensive.

Then there's a variety of minor items for the Canadian Blood Agency, for some indirect staff and benefit costs amounting to some $4.1 million.

So with that overview, I'll take my place and answer any questions that members have.

L. Reid: I'm delighted that the Chair is back in the chair. It was intriguing earlier in debate, hon. Chair, to learn that you found consideration and issuance of a special warrant to be irresponsible. So I trust that that bias won't extend to this afternoon's deliberations.

In terms of the seven items on which the minister has asked for special warrant approval, my question is: were there any items in your budget, hon. minister, where you did budget appropriately?

Hon. P. Ramsey: I'm not sure whether this deserves an in-depth, serious answer or the sort of dismissive gesture that is called for.

In this province we have a budget for health of some $6.4 billion. We have nearly 100,000 British Columbians who devote their professional careers to delivering health services to the people of this province. The great majority of them take their jobs very seriously, both in delivering services and in doing so within the means of the taxpayers of the province.

Area after area of this budget represents either meeting budget targets or coming in below. There are indeed, as the member says, seven areas where we require some additional funds. I think they are all required, otherwise I would not have presented them to this Legislature. As we get into estimates debate for the coming year and we look at the additional resources that this government and this ministry are devoting to health, I think every one of them is important. We will be presenting a package that will both preserve and protect medicare and look at where we can make significant savings in delivering health services.

L. Reid: I would address my remarks to the first

section in the special warrant: "...the Medical Services Plan for higher fee-for-service and alternative payments to physicians...." I understand that that comes in at $29.8 million.

The minister made some reference to the utilization being greater. Could you perhaps expand on that? What types of utilization?

Hon. P. Ramsey: This government reached a signed agreement with the physicians of this province in December 1993. That agreement, as the member knows, set a capped amount for fee-for-service physician services in the province of British Columbia.

That amount was based on a number of assumptions and requirements for action on the part of one or the other of the parties. In three areas those assumptions have proved, during the first year and two or three months of the agreement, to have been inaccurate, and therefore we require additional amounts to adjust that amount. This adjustment is required under the terms of our agreement with the BCMA.

First, the agreement with the BCMA was based on assumptions about what the population growth in our province would be. The assumptions were that in 1993-94 the population would grow by 2.5 percent and in 1994-95 by 2.3 percent. The actuality has been higher by about 0.2 percent in '93-94 and by nearly one-third of 1 percent in the current year.

When all the calculations are done, that pressure amounts to some $6.8 million. Where were we out? We were just simply wrong on what the population of the province was going to be. Both parties took their best shot at it; we were wrong. More people than we actually thought wanted to come to live in British Columbia, probably because they heard there is a government in this province that was interested in creating jobs and preserving medicare.

The second area is one that I had hoped we'd be able to avoid. As you know, part of the agreement with the BCMA on this capped budget said that we can reduce expected utilization by taking a number of measures. Over the term of this five-year agreement we can actually save more than $350 million of what would be normal growth in utilization.

One of the most important of those areas was in developing clinical practice guidelines, to look at how doctors actually pursue their profession and to develop some models so that we are avoiding unnecessary tests and procedures. Some members may have seen an editorial in the Times-Colonist as recently as this morning that pointed out the great discrepancies in surgical procedures from one jurisdiction to another, where there seems to be no reasonable medical explanation for it. We need to come to some sort of terms with what is correct medical application and procedure in those areas. Those are called clinical practice guidelines.

[4:45]

We could have set up some guidelines quickly and roughly; we did not. In order to enhance the credibility of that

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entire option with the medical community -- and remember, all this is driven by individual physician choice of treatment -- the Medical Services Commission decided to set up an advisory committee of leading physicians who have credibility with their colleagues, to oversee the development of clinical practice guidelines. As a result, the anticipated savings this year of $10 million were not realized. We simply did not get the work done. That will remain for future years.

I would point out to the members that over the five-year term of this agreement, anticipated savings from clinical practice guidelines are $80 million to $90 million. While this is a significant amount and I regret that the delay occurred, I think we will have a better process for developing clinical practice guidelines and making sure that they are adhered to in the province. So that's $10 million.

The third area resulted from a condition of the agreement that all those medical expenses in the province that were due to ICBC claims were properly billed to ICBC, not to the Medical Services Commission. Those who negotiated the agreement estimated that there were incorrect billings in the amount of $30 million. In actuality -- having done the detailed work with ICBC and instituting the procedure for recoveries which didn't exist before -- we anticipate the amount of recoveries only amounts to $17 million rather than $30 million. So we have a pressure there of $13 million.

In the Medical Services Commission those three pressures led us to present a special warrant for $29.8 million.

L. Reid: From the $17 million and the $10 million, I would assume that's $27 million. If there's an explanation for the other $2.8 million, I would find that interesting.

In terms of alternative payments to physicians, I am wondering if that includes salaries. Would that include expanded services at the B.C. Cancer Agency, or are you speaking with reference to another service delivery under alternative payments to physicians?

With respect to your comments regarding clinical guidelines, I would support their introduction into our medical system. But I would not for a moment suggest that utilization is only driven by physicians. I would say that the patient has a great deal of responsibility in driving the system. Both you and I know that if patients are turned down by one physician, they often find that service somewhere else. I think it's fairer to say there are more drivers in the system than just physicians.

If I could draw your attention to your comments when we were talking about utilization, you talked about the fee for service item being $29.8 million, and you've just now referenced $27 million of that. Is there an explanation for the difference?

Hon. P. Ramsey: Maybe I misstated the amounts: for the population growth greater than expected, $6.8 million; for the utilization guidelines, $10 million; for the ICBC underrecovery, $13 million. If my math serves me, that does add up to $29.8 million. I want to add that I absolutely agree with the member that patient demand is another driver of pressures on the system. That's why the BCMA and the government are jointly working on a public information campaign about utilization of physician resources, which is due to begin in about a month.

L. Reid: When we're talking about the Medical Services Plan, higher fee-for-service and alternative payments to physicians, would alternative payments to physicians include physicians on salary? Does that take into account expanded services through the B.C. Cancer Agency?

Hon. P. Ramsey: Yes, alternative payments includes salaried physicians, including the expanded body of physicians who are practising at the Cancer Agency.

L. Reid: In terms of the discussion with regard to the Insurance Corporation of British Columbia, I understand that the figure is now $13 million. I'm wondering if your ministry sources are comfortable with that number. The original estimate was $30 million. You referenced $17 million, and now we're at $13 million. I'm wondering if that's