1979 Legislative Session: 1st Session, 32nd 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)

MONDAY, JUNE 18, 1979

Afternoon Sitting

[ Page

185 ]

CONTENTS

Routine proceedings

Oral questions.

Remuneration of provincial election workers. Mr. Barnes –– 185

Refit costs of Princess Marguerite. Mr. Barber –– 186

Fraser Valley farm workers. Ms. Sanford –– 186

Giddy Up Go Ltd. licence. Mrs. Dailly –– 186

Ambulance crew shortage. Mr. Cocke –– 186

Central Native Fisherman's Cooperative. Mr. Lea –– 187

British Columbia Government News . Mr. Macdonald –– 187

Report on BCBC operations. Mr. Hanson –– 187

Railcar shortage. Hon. Mr. Phillips –– 187

Income Tax Amendment Act, 1979 (Bill 4). Committee stage.

section 4.

Mr. Howard –– 188

Hon. Mr. Wolfe –– 188

Mr. Stupich –– 190

Hon. Mr. Wolfe –– 191

Mr. Howard –– 191

Division –– 192

section 5.

Mr. Cocke –– 192

Mr. Gabelmann –– 192

Mr. Mussallem –– 193

Hon. Mr. Wolfe –– 194

Mr. Leggatt –– 195

Hon. Mr. Wolfe –– 195

Mr. Gabelmann –– 195

Hon. Mr. Wolfe –– 196

Mr. Hall –– 196

Hon. Mr. Wolfe –– 197

Mr. Hanson –– 197

Mr. Nicolson –– 197

On the amendment to

section 5.

Mr. Nicolson –– 198

Mr. Lea –– 198

Hon. Mr. Hewitt –– 200

Mr. Barrett –– 200

Mr. Smith –– 203

Mr. Hyndman –– 204

Hon. Mr. Wolfe –– 205

Mr. Cocke –– 205

Mr. Levi –– 206

Mr. Gabelmann –– 206

Presenting reports.

Insurance Corporation of B.C. sixth annual report. Hon. Mrs. McCarthy –– 207

B.C. Hydro 1978-79 annual report. Hon. Mr. Hewitt –– 207

MONDAY, JUNE 18, 1979

The House met at 2 p.m.

Prayers.

HON. MR. CURTIS: Mr. Speaker, in the

gallery today, and already welcomed by the member for Oak Bay–Gordon

Head (Mr. Smith), are four students from the elementary school,

Margaret Jenkins, in Oak Bay district. They are accompanied by Ms.

Anderson. They've been in the building and are now watching our

deliberations this afternoon. They are very special students and I am

very pleased to have them here today. They are approximately 13 years

of age. While they attend elsewhere in greater Victoria, they are

resident in Saanich and the Islands. Would the House please welcome

them?

MR. HANSON: Would the House please join me and

my colleague in Victoria in welcoming grades 8 to 10 from S.J. Willis

Junior Secondary School. They are accompanied by their teacher, Miss

Stevenson.

MR. KEMPF: With us in the gallery this

afternoon is a long-time friend, a once-logger and now rancher, a

fellow who is a staunch individual enterpriser, the type of fellow with

the type of initiative that is prevalent in the north. I would like the

House to welcome Mr. Archie Strimbold, from Burns Lake.

MR. BARNES:

I am rising today to welcome a dear friend of some 35 years. I would

like the House to join me in doing so. He is a fellow by the name of Ed

Zumwalt, and he and his wife are visiting from Portland, Oregon. Back

in the 1940s he was instrumental in assisting me in embarking on my

illustrious athletic career. I am sure most of you who have been around

will recall that Ed was around when it wasn't too popular to assist

those fellows from the other side of the street — long before the days

of black power, and so forth. Mr. Zumwalt assisted me when I was a

teenager, and he said: "Young man, I think you can go somewhere in

life." I haven't seen him for some 30 years, but I noticed he was in

the hall today, and he came up and he said: "How are you doing, Emery?"

And I said: "Who are you?" He said: "I'm Zumwalt." And I said: "Ed!"

Just like that. It's amazing how you never forget a good friend. I

don't know where he is, but I did arrange for him to be in the

galleries. I would like him to stand because, as he can see, his

efforts on my behalf were well worth it. Mr. Zumwalt? There he is,

right over here.

HON. MRS. McCARTHY: I would like to

ask the House to welcome a constituent from Vancouver–Little Mountain

in that great city of Vancouver, Alison Narod.

HON. MR. HEWITT:

It is my honour to introduce the Minister of Lands and Mineral

Resources from Fiji, Mr. William J. Clark, who is leading a delegation

to look at mineral mining in British Columbia. He has with him Howard

Plummer, assistant director of mineral development for Fiji; John Samy,

an economist; and Steven Wood, principal planner in Fiji. I would like

the House to welcome Hon. William J. Clark, who is sitting behind me; I

would ask him to stand and receive your welcome.

MR. STRACHAN:

I would ask this House to join me in welcoming Miss Michelle LaPointe,

a school teacher from School District 57, chaperones Miss Sue LePage

and Mrs. Marianne Hall, and an outstanding group of students from Upper

Fraser Elementary School.

HON. MR. PHILLIPS: I'd ask

you to welcome some more visitors from that great South Peace River

area. In the Speaker's gallery, representing the Dawson Creek and

District Hospital, are Dr. Warren Irvine, surgeon; Dr. Keith Wilson;

and Mr. Gene Casavant, the administrator of the hospital. They are here

for talks with the Ministry of Health. With them also, but not present

in the House today, is Mr. Bert Simmons, a member of the Dawson Creek

Hospital board of directors. I hope the House will give them a warm

welcome.

MR. MITCHELL: Mr. Speaker, I would like all

in the House and those in the galleries to welcome a member from the

west end of my riding, Mr. Victor Newman. Vic is a native carver and is

having a show at the Emily Carr Art Centre at 207 Government Street,

and his display is on the northwest coast carving and prints. Vic is a

very talented artist. He has received five awards and has had 16

exhibitions in B.C. Vic is sitting in the Speaker's gallery.

MS. SANFORD:

I would like to introduce a distinguished head of a household today.

Seated in the members' gallery is Mrs. Harvey Schroeder. I would like,

on behalf of the members here, to welcome the Speaker's wife to the

chamber.

MR. SPEAKER: Thank you. I want all hon. members to know that I rule the roost at my house and my wife rules the rooster.

AN HON. MEMBER: Cock-a-doodle-doo.

Oral Questions

REMUNERATION OF

PROVINCIAL ELECTION WORKERS

MR. BARNES: My question

is to the Provincial Secretary. Although the federal election was 12

days after the provincial election, district returning officers and

poll clerks who worked in the federal election have been remunerated.

My constituency office in Vancouver Centre has received about 50

inquiries about payment from DROs and poll clerks who worked in the

provincial election.

Will the minister please explain why those who worked in the provincial election have not yet been remunerated?

HON. MR. CURTIS:

I thank the hon. member for the question. It is correct. Late last

week, I think, a number of members in this House were made aware of

what can only be described as an unreasonable delay in the processing

and delivery of cheques to those who manned the various polling

stations for the provincial election.

I'm sorry that I don't

have all the numbers with me at this moment — I did not have notice of

the question. But I discussed the problem last week with senior staff

and with the chief electoral officer. I'm informed that some cheques

may well have been received today. I hope we can learn

[ Page 186 ]

from

the situation. It is unreasonable. One recommendation which we are

considering — and I have to underline that point — is that, under

careful control, a number of cheques with a block amount of money could

perhaps be made available to each returning officer for the processing

of cheques, double signature, and distribution of those cheques from

the returning office very soon after the election.

We are aware of the problem. I certainly hope that we can avoid it in future. I will make every effort to ensure that is done.

MR. BARNES:

I have a supplementary question. Does the minister intend to include

any of the changes that he has in mind in the revisions to the

Elections Act?

MR. SPEAKER: The question is really not in order.

MR. LEVI:

The minister gave a rather elaborate explanation of something that's

obviously not taken place. Could he now tell us what it was that did

take place? What have we got here? Is it a problem with the issuance of

cheques through the Systems Corporation or his own ministry or what? He

didn't say that; he just said there was a problem. What is the problem?

HON. MR. CURTIS:

I gave as full an answer as I thought I possibly could. There is a

problem. It appeared that the transmittal of names, the determining of

amounts, the whole system took longer than it should have. I can't

identify precisely where in the chain this problem developed, but it is

sufficient to say that there is a problem. I'm not happy over the fact

that there is a problem. I identified it last week, and we certainly

hope to have it cleared away and not to have a repetition of it in the

future.

MR. COCKE: On a supplementary question, Mr.

Speaker, I wonder if the minister can confirm that while the federal

government had their cheques out almost minutes after the election, the

provincial government did not do so. It did, however, do so in the past

when it was left to clerks. This time, however, it was programmed into

a system of computers that didn't kick out the cheques. I wonder if the

minister can confirm that.

HON. MR. CURTIS: Mr. Speaker, I can't confirm or deny that this afternoon.

REFIT COSTS OF PRINCESS MARGUERITE

MR. BARBER:

I have a question to the Minister of Economic Development in his

capacity as minister responsible for B.C. Steamship Company. Has the

minister received a report from the management or the board of

directors of the B.C. Steamship Company regarding refit costs of the

vessel Princess Marguerite ?

HON. MR. PHILLIPS:

Mr. Speaker, in answer to the member's question, as you know, I've just

recently taken over the responsibility for the British Columbia

Steamship Company. I will be having a directors' meeting in the very

near future, at which time we will be reviewing refit costs, where we

are going, the whole operation.

MR. BARBER: A

supplementary question. It's very nice to know that, but what I asked

was: have you received a report from the management or the board

regarding refit costs as of today?

HON. MR. PHILLIPS:

Mr. Speaker, in answer to the member's question, I have received no

official report. I have discussed it in very broad, general terms with

management. I haven't received an official report; but I have asked for

one, and I will be receiving it in due course.

MR. BARBER:

A further supplementary, Mr. Speaker. Could the minister indicate

whether or not he has received information that the proposed refit

costs for the Marguerite will amount to some $3 million?

HON. MR. PHILLIPS: Mr. Speaker, I've already answered that question.

MR. BARBER:

A further supplementary, Mr. Speaker. Can the minister inform the House

when he expects to make and announce a decision on the future, if any,

of the vessel Princess Marguerite ?

MR. SPEAKER: The question is not in order.

HON. MR. PHILLIPS: Mr. Speaker, the answer is no.

FRASER VALLEY FARM WORKERS

MS. SANFORD:

To the Minister of Labour: is the ministry conducting an investigation

into the employment and the contracting of farm workers in the Fraser

Valley?

HON. MR. WILLIAMS: There is an ongoing

inquiry underway with respect to some of the specific problems

associated with casual farm labour and labour contractors.

MS. SANFORD:

A supplementary question: I wonder if the minister expects to receive a

report from that inquiry — and in time for some action to be taken

during this session — in order to put a halt to the present

exploitation of farm workers in the Fraser Valley.

HON. MR. WILLIAMS:

If exploitation is taking place and the report so shows, I expect that

we will be seeing legislation in this session dealing with it.

GIDDY UP GO LTD. LICENCE

MRS. DAILLY:

To the Minister of Highways: on June 7 I asked the minister a question

with reference to the licence for Giddy Up Go Ltd., which transports

race horses, and I've been waiting with bated breath for the answer. I

wonder if you have the answer for me now.

HON. MR. FRASER:

I just received the information. You wanted to know when the next

hearing for Giddy Up Go is going to take place. The hearing will be

held on August 21, 1979, and this is at the request of Giddy Up Go.

AMBULANCE CREW SHORTAGE

MR. COCKE: I'd like to ask the Minister of Health a question. Since he has seen fit to put ambulance and

[ Page

187 ]

emergency services in a high profile, can he explain an estimated shortage

of 200 ambulance crew across the province?

HON. MR. McCLELLAND: Two hundred shortage as compared to what? I don't understand the question.

MR. COCKE:

An example would be the shortage in Mission where recently they had an

ambulance call and could find only one attendant. The kinds of things

that have occurred strike me that when the estimate was given to me,

the estimate was relatively close. What I'm saying is that those people

engaged in ambulance operation tell me that they are 200 short. Is the

minister not apprised of this? I know he's very concerned about other

areas, but I think that this is an emergency.

HON. MR. McCLELLAND:

I suppose when the member stands up and gives me estimated questions,

about all I can do is give him estimated answers. I don't know what the

200 is in relation to. I'm not aware of a shortage of 200 people in the

ambulance service, Mr. Speaker. We will be discussing that in

estimates, as they come up, and I'm sure that we will see that there

have not been any reductions in numbers of people, but rather that

there have been increases, and those increases will continue.

MR. COCKE: That minister is amazing. He has the same kind of flights of fancy as those people who bang their desks for him.

Mr.

Speaker, when he talks about no reductions with an increased population

and an increased need, is there or is there not a shortage of ambulance

personnel in this province? Yes or no.

AN HON. MEMBER: He just said no.

MR. COCKE: He did not say no.

CENTRAL NATIVE

FISHERMAN'S COOPERATIVE

MR. LEA: Mr. Speaker, I have

a question for the Minister of Labour. Could the minister tell the

House what the current relationship is between the board of directors

of the Central cooperative, near Bella Bella, and the Port Simpson

cannery?

HON. MR. WILLIAMS: As far as I am aware, none, Mr. Speaker.

MR. LEA:

Is the minister aware of any changes between those two cooperatives? In

other words, has one cooperative directorship taken over the

directorship of the other cooperative recently?

HON. MR. WILLIAMS: I believe the answer to the member's question

is no. The member may be aware that in the herring fishing season, the directors

of Pacific North Coast Native Cooperative make an arrangement with the Central

Native Fisherman's Cooperative to provide certain management functions during

the herring season. But other than that there is no relationship between those

two boards of directors that I am aware of.

MR. LEA:

I wonder if the minister could look into that. I want to tell the

minister that I am only going on some rumours that have been given to

me. I would just like the minister to check into it, because I think

the rumours are having some effect in the community, and I think it

would be better to have them cleared up.

BRITISH COLUMBIA GOVERNMENT NEWS

MR. MACDONALD: To the Provincial Secretary, Mr. Speaker. I asked a question last week about public service health for the publication of the B.C. Government News . Has the minister got the answer?

HON. MR. CURTIS: Mr. Speaker, I took the question as notice. I will return to this House with information.

MR. MACDONALD:

Since I need the information to help me prepare a speech, I am asking

the minister why there should be any problem about receiving that very

simple information requested.

HON. MR. CURTIS: Mr.

Speaker, if I do have the information, I will give it to the member at

the earliest possible time, in order that, for once, we can have

accuracies in that member's speech.

REPORT ON BCBC OPERATIONS

MR. HANSON:

Mr. Speaker, I have a question for the hon. Provincial Secretary, which

I asked some time ago but was cut off through time. I'm asking about

the report done by Mr. Bowles on the operation of B.C. Buildings

Corporation. Is that report now ready?

HON. MR. CURTIS:

Mr. Speaker, the question suggests that the report was directed

exclusively to British Columbia Buildings Corporation. I am unable to

answer a question based on a false premise.

RAILCAR SHORTAGE

HON. MR. PHILLIPS: I would like to answer questions given to me in the House last week by the Leader of the Opposition.

Leave granted.

HON. MR. PHILLIPS: Question number one: is B.C. Rail building railcars? The answer is no.

Question

number two: is B.C. Rail purchasing railcars? The answer is no. B.C.

Rail has negotiated leases on a total of 1,145 cars — 500 boxcars, 285

of which are additions to the fleet and 215 of which are replacements

of other equipment, and 645 bulkhead flatcars, 172 of which are

additions to the fleet and 473 of which are replacements of short-term

leases and shippers' leases. The total addition to the fleet is 477

boxcars, which, I might add, Mr. Speaker, is just one half-year's

production in the old plant. B.C. Rail has been able to obtain

long-term leases for the cars it requires at a net cost which is far

less than if these cars were purchased.

Interjection.

[ Page 188 ]

HON. MR. PHILLIPS: Well, they'd all be on welfare if you were still president of the railway.

Question

number three: how many cars is B.C. Rail short of on a daily basis? The

answer is that B.C. Rail is supplying additional railcars to meet all

customer requirements at this time. The recovery from the winter car

shortage has been far faster on British Columbia Rail than on the two

national railroads.

Question number four: is the minister

aware that car shortage can be alleviated by building more cars? The

answer is that the car shortage last winter was the result of severe

weather conditions which hampered the ability of the United States

railroads to return railcars. In the circumstances, the number of cars

owned by British Columbia Railway is irrelevant. Had the railway had

more equipment, it would simply have meant that more cars would have

been caught in the congestion in the United States.

Question

number five: has the minister investigated the possibility of producing

railcars at Railwest for sale to other railways? The answer is that the

economics which made Railwest uncompetitive still exist, namely, high

cost of materials, transportation and labour. The production from the

plant was marketed at the distress price for a period of 15 months when

demand for railcars was at its peak, and yet the railway did not

receive a single offer. At the end of that period, B.C. Rail seized the

opportunity to upgrade its own heavy repair facilities and is making

use of the plant and car shop.

Orders of the Day

HON. MR. GARDOM: Mr. Speaker, I ask leave to proceed to public bills and orders.

Leave granted.

HON. MR. GARDOM: Committee on Bill 4, Mr. Speaker.

INCOME TAX AMENDMENT ACT, 1979

The House in committee on Bill 4; Mr. Rogers in the chair.

Sections 1 to 3 inclusive approved.

section 4.

MR. HOWARD:

When the minister wound up or closed off the debate on second reading,

he said — and I paraphrase his words now rather than quote them — "This

proposal for a 5 percent tax credit against dividends received from

corporations in B.C. is also a situation that is in effect in the

province of Quebec." I wonder if he could tell the committee what the

foundation for that statement was. Has he a communication from the

Province of Quebec, or has he looked at the statutes?

HON. MR. WOLFE:

This relates to the 5 percent dividend tax proposal in our budget. I

was only referring to the fact that it was mentioned in the budget

speech of Quebec, which was introduced sometime after our budget

speech. I don't know the details of that proposal, but that's where my

information comes from.

MR. HOWARD: At the other

stage, Mr. Chairman, I argued that this proposal really didn't and

would not advance the investment of funds in corporations in B.C.,

other than those that are already established and/or are paying

dividends, because it's a credit against the dividend received and paid

by a company. Newly developed companies starting into small business or

mining operations or anything of that sort would not be affected one

whit by this particular proposal. I argued that if it is worthwhile to

provide an incentive to people in British Columbia to invest their

funds in equity capital of companies, especially those that are seeking

to embark upon new ventures, then this is not the way to go about it.

was somewhat surprised when the minister mis-stated the relationship

between this proposal and the proposal which exists in the province of

Quebec. The province of Quebec — and I only mention this for

comparative purposes — in the budget which was presented to the

National Assembly earlier this year did, in fact, put forward a

proposal seeking to encourage Quebecers to put money into equity

financing and to invest money in new ventures in that province, but not

through this mechanism of a dividend tax credit.

The Toronto Globe and Mail

for Wednesday, March 28, of this year covers in quite some detail the

proposal put to the National Assembly in Quebec City by the government

of Quebec on this subject matter of attracting investment capital. I

would like to quote just a few references from it to put forward what I

think the government here in B.C. should be doing if it is seriously

interested in attracting equity capital into new ventures, mining

operations and the like in this province.

This is the budget scheme proposed to the National Assembly according to an

article in the Globe and Mail

by a Wendy Kerr. She says that what Mr. Parizeau is offering Quebecers

is a chance to deduct the money they invest in new issues of Quebec

companies from their income. His stock savings plan would allow

taxpayers to get the same benefits from their stock investment as they

now get from contributions to registered retirement savings plans and

similar tax-deducibility schemes like that, up to a combined 20 percent

of their earned income to a maximum of $15,000. The proposal in Quebec

is that the stock must be a new issue put out by a public company with

its head office or major Canadian office in Quebec. To make sure that

the taxpayers don't buy the shares, get the tax break and then turn

around and sell the shares within a short period of time, under the

proposal in Quebec the taxpayer has to have the stock in his possession

for a two-year period. If he sells it within that period, then he does

not get the tax advantage. This is a distinctly different proposition

from that which is being put forward by the minister here. I submit

that this proposal will attract not one single cent into new companies,

into new venture in the province. It will only be a rip-off against the

other taxpayers in the province of British Columbia who are not able

financially, or inclined, to put their money into shares of

corporations and receive dividends.

In looking at the

precision of it, Mr. Chairman, perhaps I could try to do it in another

way and use as an example — a suppositionary example admittedly and

based on some assumptions which may not be accurate. Look at, for

instance, the Minister of Finance himself. It's public knowledge that

his income for tax purposes as a cabinet

[ Page 189 ]

minister

is $24,000 a year. It's public knowledge that his income for tax

purposes as an MLA is $16,000 a year, and all cabinet ministers are in

that category. Assuming that there is no other earned income, his total

income in a year would be $40,000. After making deductions that he

normally would make for the MLAs' superannuation fund, $2,600 personal

deductions for himself and his wife, again assumed to be about $5,000,

that would leave him with a taxable income of $32,400.

What

I'm trying to do is show how the dividend tax credit system proposed

here would affect the Minister of Finance, assuming these things to be

correct. His $32,400 of taxable income would be taxed at a combined

federal and provincial rate of 46.08 percent, or 46 percent for general

reference purposes. Thirty-two percent of that would be federal, and

the balance — between 32 percent and 46 percent — would be the

provincial portion of the tax. Assume the minister owned 1,000 common

shares of B.C. Telephone Co. which paid a dividend of $1.20 a year. His

income from those dividends would be $1,200 a year. To include that

dividend income in his other income he, by federal law, has to increase

it by 50 percent which would be a total amount of $1,800 — that is, 50

percent more than the actual amount of the dividend. If he were to pay

his 32 percent federal tax on that $1,800, he would be required to

enter $576 as tax payable on the dividends he has earned from B.C.

Telephone Co.

Under the federal plan, the minister then

would get a 25 percent credit against his tax — 25 percent of the

$1,800. He'd get a credit of $450 towards the $576 he'd have to pay in

tax, leaving him a net federal tax payable of $126 on $1,200 of income.

For the provincial portion of the tax of that $126 I've taken 44

percent, although this year it is proposed to be 45 percent. But I've

taken 44 because that was what I thought it was going to be when the

income tax was reduced.

So he works out his provincial tax

of 44 percent of the federal tax, which is $55. He has a total tax

payable of $181 on $1,200 of dividend income. That's 15 percent tax

rate he's paying on dividends compared with 46 percent tax rate on his

other income — a distinct advantage, a distinct present.

Now

we have this proposal. When he comes to work out his provincial tax he

now, at the provincial level of taxation, is going to get a 5 percent

credit — that's 5 percent of $1,800 — against the amount of his

provincial tax, and 5 percent of $1,800 is $90. So he now gets another

$90 credit against his tax. Deducting that from $181 he has to pay, we

find out he pays $91 of tax on a $1,200 income, which is 7 percent tax

rate. And he's taxed at the rate of 7 percent on the $1,200 he gets

from dividends, taxed at the rate of 46 percent on the rest of his

income. That I consider to be a rip-off because it's a deduction

against tax; somebody has got to make up that difference — other

taxpayers who are not in that advantageous position.

Let's

look at another situation in order to give some further balance to

what's happening here. Let's assume an ordinary MLA — I was going to

use the reference point of the first member for Vancouver South (Mr.

Rogers) but I decline to do that because the honourable gentleman is in

the chair and it might be misinterpreted — has the $16,000 income as an

MLA liable to be entered for tax purposes, and no other earned income.

ordinary MLA would have a pension deduction to the MLAs' pension plan

of $1,040. Assume husband and wife deductions of $5,000, roughly

speaking, leaving about $10,000 of that income as an MLA as taxable

income. Let's assume that MLA has, say, 1,000 shares of B.C. Sugar,

which pays a dividend of $2 a share. If I'm incorrect, I'm sure the

Chairman will correct me on this, but let us assume 1,000 shares of

B.C. Sugar Refineries. At $2 a share, that's $2,000 dividend income

from the B.C. Sugar shares. The MLA in question would have to increase

by 50 percent that $2,000 income and enter onto the income side of his

income tax form the amount of $3,000, by federal law. He would be at

that $10,000 level in a tax bracket, federally, of 23 percent, combined

federal and provincial of 33 percent, once we add the 44 percent

provincial tax on top of that. So his $3,000 grossed-up dividend income

from B.C. Sugar shares is taxed at the rate of the federal level of 23

percent. He pays a tax of $690, or is liable to pay a tax of $690 on

that.

But he also gets a dividend tax credit at the federal

level of 25 percent of that $3,000, which is $750. So he has to pay

$690 tax on the dividend income, but gets a credit of $750 towards the

$690. He's got an overage of $60, which he applies against the tax

payable on his other income. So he not only gets all the dividend

income tax-free in this case, but he gets a gift of an additional $60

from the taxpayers of Canada. Now he comes to work out a no-provincial

tax on that one, because there's no federal tax.

Now he's

going to get, on top of that, according to this proposal, a 5 percent

credit, 5 percent of $3,000 credit against the provincial income tax

otherwise payable; and that's what clause 4 says. In addition to paying

no tax whatever on the dividends, he gets a $60 bonus out of the

federal treasury, plus 5 percent of $3,000 bonus from the provincial

treasury. So he gets a $150 gift from the taxpayers of British Columbia

on top of paying no tax whatever on the income earned from those

theoretical 1,000 shares of B.C. Sugar.

That is nothing more

than a gift by this government to those who have, and the denial of any

opportunity to those who either by inclination, as I said earlier, or

by inability to find the funds to do it — those in lower income

brackets — as unable to take advantage of this; but it is an advantage

to those who can afford to do it. The people who are going to make up

the difference, the subsidy, are those in the lower income-tax bracket.

The Minister of Finance knows better than anybody else that, if he has

got a shortfall of funds over here, he's going to make it up somewhere

else. All this is is a gift. It has nothing whatever to do with

attracting venture capital into B.C. or attracting so-called risk

capital into B.C. It's got nothing whatever to do with enticing people

to put their money into new ventures and new businesses. It's a

donation and a contribution to those who need it the least, namely, the

people who, like the minister and like other MLAs who are in the higher

and luxurious income-tax brackets, can well afford, if they so desire,

to do that.

I know dozens and dozens of people in northern

B.C. who just exist from one paycheque to the next, and many times with

gaps between those paycheques. They've got lots of incentive and lots

of drive and lots of energy too.

MR. KEMPF: And lots of wages too, at $9 an hour.

[ Page 190 ]

MR. HOWARD:

For the benefit of those who are ignorant enough not to be able to know

the truth of these matters, the average construction worker in northern

B.C. — certainly since this government has been in office — has worked

an average of about seven months out of the year and is out of work the

rest of the time.

MR. KEMPF: Have you never heard of break-up?

MR. HOWARD:

The only break-up that exists here is between the honourable

gentleman's ears. If he knew anything at all about construction work he

wouldn't make such an asinine statement.

MR. KEMPF: If you knew anything about the north you wouldn't be making that kind of statement either.

MR. HOWARD:

Mr. Chairman, please protect me. I was admonished very severely the

other day for intruding upon the rules. I was advised to read certain

sections of May, seventeenth edition, which I did. I'd suggest it would

behoove the honourable gentlemen opposite, who bleat away like blind

sheep about things, to read the same rules — not that I'm giving you a

lecture, Mr. Chairman, but it would be most helpful.

When

the chips are down, all of the reasons given by the Minister of Finance

as to the value of this particular proposition are inaccurate reasons —

they do not apply. They are not going to attract investment capital.

They will only attract people, who may want to do it in any event, to

put their funds in share capital of companies that are already paying

dividends. And those that are already paying dividends are not new

companies. They are not new mining companies starting out. They are not

new small businesses starting out. They're not the new ventures that we

need so much to provide employment in the north country and in other

parts of the province. It's just a gift to those who have. And on that

basis, plus the fact that the minister was so wrong in drawing any

comparison between what the Province of Quebec did — as outlined in the

Toronto Globe and Mail , from which I read — and what he is

proposing, I have no other recourse but to express my opposition to

this particular clause.

HON. MR. WOLFE: As I said in

earlier debate, I appreciate the member's interest in this subject. A

great many people probably can't follow the intricacies and infinite

detail involved in these percentages. I would remind the member that we

also have a companion measure having to do with the establishment of a

venture capital corporation in British Columbia, which has as its main

objective the encouragement of new, more risk-type ventures in this

province. You fault this measure because, in your opinion, it doesn't

qualify for that particular reason.

I urge you to read what

was said on page 43 in the budget speech. Our entire approach there

indicated that we wanted to encourage local control of corporate

decisions which affect the British Columbia economy.

"When decisions affecting the province's economy are

taken by managements remote from the province, we are not satisfied that the

people making those decisions are as knowledgeable about provincial conditions

as they would be if they were located in British Columbia. We do not intend

to allow British Columbia to become a 'branch plant' economy.

"This

government believes in individual ownership. Through tax measures that

benefit the individual, such as the dividend tax credit, ownership of

our industry by our citizens will be encouraged which will create

further opportunities for the individual. This dividend tax credit is

intended to benefit the average person who purchases shares."

I don't see that the objectives you are referring to are failing in terms of this particular proposal.

Incidentally, I believe you mentioned on several occasions that

this is a rip-off at the expense of other taxpayers. You could put it

in those terms, but anytime you alter the income tax in any field it

affects all of the other taxpayers. You can't provide incentives of one

kind or another, which this is, without being subject to that kind of

criticism from yourself, I would imagine.

I just wanted to

say in addition to that that we have studied very carefully the

implications of some of the tax cases to which you refer, and we

appreciate the fact that a dividend tax credit can work out in certain

circumstances to be more than the tax resulting from the receipt of the

dividend. In no case, however, would an individual receive a refund

from the government resulting from the application of the dividend tax

credit, as it is a credit only to be applied against tax payable. So

we're aware that in certain circumstances you can make a case where

there is more tax credit than the dividend might have been, but it's

only in certain cases.

I'd like to say as well that very few

taxpayers will fit into the type of situation we're now referring to.

If we were to consider altering the situation to restrict it in this

regard, it would considerably complicate the tax return, and there is

some question as to whether Revenue Canada would administer it in this

way. I think we should further be aware of the fact that their

particular tax credit, which you referred to in the grossing up and the

20 percent situation, does not have a restriction of that type either.

These present tremendous complications in the tax return.

can say, Mr. Chairman, that we are undertaking to watch this situation

carefully. The bill is subject to proclamation, and if in the future it

requires amending to adjust for those kinds of things, we'll certainly

be looking at it.

MR. STUPICH: Mr. Chairman, I

expressed some reservations about

section 2 of this legislation when we

were discussing it in second reading. My concern then was that it was

treating the very wealthy the same as it was treating the lowest of the

taxpayers; it was a straight 2 point reduction. I'm dealing with the

progressive nature of income tax, Mr. Chairman. I'm not really talking

about

section 2, but simply using it as an example.

MR. CHAIRMAN: We're on

section 4.

MR. STUPICH:

I appreciate that. My concern about

section 2 was that it did nothing

to make income tax more progressive; my concern about

section 4 is that

it goes in the other direction. It goes in the wrong direction; it

makes it more of a tax against the poor than it does against the well

off, and for that reason I don't see how we can support it.

[ Page 191 ]

The

minister said that this business of getting an additional credit in

excess of the tax that will be payable by dividends will apply in only

a few cases. Mr. Chairman, we've heard in the publicity given to the

BCRIC disbursal that some 60,000 people in the province are

shareholders and collect dividends — only 60,000 of all of the

taxpayers in the province.

HON. MR. WOLFE: No, that's not correct.

MR. STUPICH: What was the figure?

HON. MR. WOLFE: Excuse me, yes.

MR. STUPICH: It is correct, then — 60,000 people.

HON. MR. WOLFE: Previously, yes.

MR. STUPICH:

The information that I heard on the radio this morning is that 60,000

people have applied for BCRIC shares in addition to the free ones, so

to some extent they're the same 60,000. He said the figure may go

higher; he didn't have final figures yet. But even if we say that some

100,000 people in the province are going to be shareholders of public

companies, then we have to start decreasing that number by those who

have head offices outside of B.C., because this particular

section

applies only to those corporations that have head offices in the

provinces. So it's hard to say just how many taxpayers might be

benefiting by this legislation, but it's certainly nowhere near a large

proportion of the taxpayers in the province of British Columbia. So

what we're doing to a very small group is saying: "Here, we're going to

give you some special benefit. If you invest in corporations like this

you're going to be paying less tax than you would otherwise, wherein

all the other taxpayers together — the poorest as well as the richest —

are going to help make up the shortfall that is going to arise in

government revenue, because we want to make this special deal for a few

people in our community."

Well, Mr. Chairman, if we're going

to make special deals, we should be doing it at the other end of the

scale, as I pointed out in second reading. The minister did say in the

budget speech that a special deal is being made for some of those

people. It's going to benefit some 68,000, I think. None will pay more

provincial tax than federal tax. That's the kind of special deal that

we'd like to see, and we'd like to see more effort being put into a

special deal for the poorest rather than this effort being put into a

special deal for those who are well off.

When it comes to

estimates — and again I'm not transgressing, I'm simply throwing it in

as part of my argument — I intend to ask the minister what evidence he

has that an increasing number of people came to B.C. to die because we

removed succession duties. Now we're throwing one other thing in to try

to get more people to invest in B.C. It would seem to me, Mr. Chairman,

that these are pretty desperate measures to try to get something going

in the province and they are not really going to do anything for the

economy in B.C. I'm against this particular section.

MR. HOWARD:

As the minister said, in some circumstances it would prevail that a

person would get a credit greater than the amount of the dividends. In

fact, there would be an excess there. I wonder if he could tell the

committee what research work the Ministry of Finance has done to be

able to indicate what is the income level at which that break-even

point is reached. In other words, what is the income level in the

province, as a result of researches the Department of Finance has done,

above which the dividends would start to be taxed? What is the 100

percent break-even point?

HON. MR. WOLFE: I don't

have an exact figure, but in examples used in supplying this research

the types of cases we're referring to are in the low income side. They

are low income taxpayers where you can have the situation that we have

just referred to, where the dividend tax credit could exceed the amount

of tax payable.

MR. HOWARD: But you don't have any

precise figures. And I assume you haven't done any research on the

subject matter. What is the level? I would like to know that.

I guess I'm not going to get an answer for that, and they obviously don't know.

Could

the minister say what statistical analysis his department has made to

determine what amount — total dollar value of tax lost — would occur as

a result of this proposal? In other words, you are going to give people

a 5 percent dividend tax credit. How much less money is going to come

into the coffers of the treasury as a result of that, taking whatever

given taxation year you want to take?

HON. MR. WOLFE:

On a total basis, the estimated cost of this measure is $3 million. As

I said earlier, in the answer to your question, I am indicating that in

the various examples we have developed, it is in the low-income side

taxpayer where you find this anomaly does take place. So we should

alleviate a lot of your concern, I would think.

MR. HOWARD:

I suppose that comes to defining what low income is. According to my

calculations, and I'd like the minister to correct me if I am mistaken,

it will be of advantage to anybody earning taxable income up to

approximately $22,000 a year to pay no tax whatever on the dividends,

federal or provincial. And above $22,000 they will start paying tax at

the very reduced rate of 5, 6, 7, 10 percent, and so on, so that to a

maximum position of anything above $99,000 a year a person wouldn't pay

any more than 37 or 38 percent of tax, when his total income is in the

60 percent bracket. Does the minister say that is wrong?

HON. MR. WOLFE:

It would depend entirely on the mix of income in any individual

taxpayer. We would have to spread dozens of cases out here to arrive at

a conclusion such as that you just made. It depends on the mix of

income that would be developed in any personal taxpayer.

MR. HOWARD:

I just put it to you that those are accurate figures which I gave to

the minister. Once a person reaches that level of taxable income....

HON. MR. WOLFE: It depends on the mix, Frank.

[ Page 192 ]

Section 4 approved on the following division:

YEAS — 27

Waterland

Nielsen

Chabot

McClelland

Williams

Hewitt

Mair

Heinrich

Ritchie

Strachan

Brummet

Ree

Segarty

Curtis

McCarthy

Phillips

Gardom

Wolfe

McGeer

Fraser

Jordan

Kempf

Davis

Davidson

Smith

Mussallem

Hyndman

NAYS — 21

Howard

Leggatt

Lorimer

Hall

Nicolson

Lea

Cocke

Stupich

Barrett

Macdonald

Levi

Sanford

D'Arcy

Lockstead

Barnes

Brown

Barber

Wallace

Gabelmann

Hanson

Passarell

Mr. Stupich requested that leave be asked to record the division in the Journals of the House.

section 5.

MR. COCKE:

Mr. Chairman, in

section 5, we're looking at a

section that has very

interesting connotations, as far as I can see. What we're doing here is

saying that we're going to give a retroactive pat on the back to Social

Credit supporters across the province.

AN HON. MEMBER: Order!

MR. COCKE: It's true, none the less.

We're

saying that the promises made by the candidates, by the official

agents, by the campaign managers and campaign workers and Dueck on

Broadway, were that if you vote Socred and if you support them

financially, and if we can squeeze them in somehow, you're going to get

a rebate on your donations to the Social Credit Party.

think there are a number of criticisms that I can put forward with

respect to this section, not the least of which it is that it's Mickey

Mouse. It does not come followed or in tandem with any kind of a change

in the Provincial Elections Act. There is no control; there's no

question in terms of where political donations come from; there's no

recording, there's nothing.

When the federal government

changed their Act to permit tax relief for donations, it was

incorporated in a much larger area which included all those other

safeguards.

I don't think, Mr. Chairman, that anyone on either side of the House, having

given careful consideration to this

section could, in all honesty, vote for

it. It strikes me that even if this were in prospect, even if it were from here

on in, it would be something that would have to be debated for some length of

time because of the lack of any kind of safeguards. But when it is dated back

to April 2, so that it includes a past campaign — that's when you introduced

it, knowing full well you were going into an election....

HON. MR. WOLFE: That's why we introduced it. It wasn't backdated.

MR. COCKE: Why didn't you pass it then?

HON. MR. WOLFE: You're all mixed up.

MR. COCKE:

No, I'm not all mixed up. If that minister had any concern or any real

feeling about this House, then they would have put that bill forward at

that time, prior to calling the election. You didn't have to call the

election on April 6. You could have delayed it a couple of days. No,

you held it out as a carrot — a typical Social Credit carrot to all the

folks out there. Incidentally, you had trouble finding a lot of folks

out there, I noted. But all you have to do is work real hard, donate

lots of money, and you're going to get lots of it back. I just feel the

whole thing is a mockery of the parliamentary process.

AN HON. MEMBER: How are you going to vote?

MR. COCKE: I'm going to vote against it, of course. How are you going to vote? Or do you vote in principle, or on principal?

MR. CHAIRMAN: Order, please. Perhaps members could extend some courtesy to the member for New Westminster, who has the floor.

MR. COCKE: I'm out of order, Mr. Chairman, for answering that twit. No, I withdraw the "twit."

MR. CHAIRMAN: Hon. member, I'm sure you are aware that word is on our unparliamentary list.

MR. COCKE:

I suggest what we're reading here is a bill, or at least a

section of

the Income Tax Act that should be accompanied by a change in the whole

electoral process. These things should not be done giving a retroactive

effect to the Act that encourages this sort of thing to occur in the

future. I really feel all of us should really think about what we're

doing here. There is another part that just absolutely defies the

imagination, and that is

Part V: "Regulations relating to this

section

may be made retroactive to 12 midnight April 2, 1979, and under

enactment shall be deemed to have come into force at that time." So

what we're doing here is voting on regulations that we haven't a clue

what they might include.

They'll probably be quite wrong,

judging from this government's past performance. The whole thing, I

think, is a mockery of the parliamentary system, a mockery of the

House. It shows again that the Minister of Finance and this government

really do not understand the whole process of making laws regarding the

future as opposed to making laws regarding the past. They're just

bribing the friends of the Socreds. How anybody could have given them

money I can't imagine. But I guess there are a few out there in the

population who did during the last campaign.

MR. GABELMANN:

I want to make a few comments concerning this

section of the bill. I

believe in principle that the idea of contributions to political

parties should be made tax deductible in some manner. I agreed with the

federal legislation that was introduced. It was long overdue at that

[ Page 193 ]

level. I think legislation of that sort is long overdue at this level, provincially.

have two basic concerns with the sections. The first relates to its

retroactivity. In the

section of this particular bill, should this

section pass, the definition of "political parties" is so wide that it

would allow any group who had run candidates in this province — perhaps

even Independent candidates who contested seats in this past provincial

election — theoretically to be eligible for benefit under this section.

It was not the law of the land when those people ran; they were not

running as candidates in the last general election with the knowledge

that they could, in fact, collect and keep records of donations for tax

purposes.

This

section of the bill is, in my judgment,

blatantly discriminatory to people who ran as candidates who were not

members of our party or of the government party. Our party can benefit

under the Canada Elections Act, so it doesn't matter to us

particularly. The government party can benefit because it was aware

that it had internally promised itself it would do this should it be

re-elected. Other candidates would not have been aware that such a

retroactive law would be passed, and they should not be discriminated

against.

There are times when retroactive legislation is

appropriate. Certainly in the sales tax reduction I would support that

kind of principle. I'm not opposed to the so-called principle of

retroactivity so much as I am the way it's applied in this particular

section. I don't know whether it's necessary to raise my voice, shout

and repeat myself. I won't do that. But sometimes in this House it's

necessary to do those kinds of things in order to make clear your anger

about a particular piece of legislation. This, in my judgment, is

reprehensible legislation, and this

section must not be allowed to pass

this House.

My other major concern is a more general one. I

believe it is necessary to have election spending legislation in this

province as we now have nationally and as many other provinces have.

But I do believe that all of those bits of legislation should be

included in one piece of legislation that we can consider as a package,

that we can consider as a whole. The subject of spending and raising

money in election campaigns is so complex, important and vital to our

democratic system that it is a subject that should be explored by a

committee of this House, travelling around this province listening to

what people have to say and drafting legislation as a result of that

kind of public debate and public disclosure. We must not bring in

election legislation in a piecemeal fashion such as this.

few pieces of this

section of this bill concern me. Under the federal

Act the amount contributed is very carefully recorded under a very

careful system of vouchers and forms that have been given to the

political parties. Each political party is allowed one person and one

person only in each constituency, or in each province, to be the person

who is accountable for that donation, who is responsible for that

donation. Any violations of the legislation under the federal Act fall

on the shoulders of that one person. Who kept the records in the past

provincial general election? Who was responsible for keeping the

records in the past provincial general election if this bill is passed?

Which person is responsible legally for violations? These, for me, Mr.

Chairman, are not rhetorical questions. They are important and must be

answered before I'm prepared to seriously consider this kind of

legislation.

Other jurisdictions in this country, and the

national House itself, have spent countless hours, days, months and, in

fact, years debating what is a recognized political party. It is a

complex issue. Is a recognized political party a party that runs X

number of candidates, that receives X percent of the vote? Is it one

person standing up and saying: "I am a recognized political party. I'm

going to run as an independent."? We don't know clearly enough what the

answers are. The bill says: "A bona fide affiliation of electors

comprised in a political organization that has as a prime purpose the

fielding of candidates for election to the Legislative Assembly." Two

people with two friends could qualify under that wording — two people

with two friends in two separate constituencies. If you say they don't

qualify, what numbers do qualify? Is it four with six friends? How do

we define these kinds of things? Apparently we're going to define them

in regulation outside the scope of this Legislature, outside the public

debate.

AN HON. MEMBER: What a bunch of malarkey.

MR. CHAIRMAN: Order, please!

MR. GABELMANN:

Perhaps what I'm saying is a bunch of malarkey. I'm prepared to have

that proven. If the minister is able to stand up in debate and explain

and prove to me that this

section has had as much deep debate, as much

research and as many safeguards as the federal legislation has, then I

withdraw what I said.

I'm one of those people, Mr. Chairman,

who have spent a great deal of time in the last three or four years

with the federal Act. I've dealt with it in terms of its drafting, its

implementation and its use, and I know that this whole subject is

absolutely and incredibly complicated and cannot be solved by a simple

piece of legislation like this that has no rules or regulations

attached to it.

Mr. Chairman, I'm not going to say very much

more, other than, as some of my colleagues have said, I believe the

section should be withdrawn. I believe that it should be re-introduced

after committee study. I think it should include a variety of other

subjects such as spending limitations and declarations of donors. Will

the names of the people who donate under the

section be made public? If

not, why not?

But most importantly, I believe that in a

democracy, the system of electing members to this House or any other

House must be seen to be fair, must be seen to be above board, and this

section of this bill precludes that.

MR. MUSSALLEM:

Mr. Chairman, I have the great pleasure to stand here and speak on this

section. One thing about the Social Credit Party, I can tell my

honourable friend, is that we're not devious.

MR. CHAIRMAN:

Order, please, hon. member. Hansard is having some difficulties with

the mikes. It may be necessary for them to make some repairs.

Hon.

member, perhaps you could try the mike from the second member for

Vancouver South, the member standing behind you or the member for

Skeena.

MR. MUSSALLEM: Mr. Chairman, I think it's

some deep scheme to get me off the floor. When I speak through a

microphone of my honourable friends on this side, I don't

[ Page 194 ]

have a feeling of ease. I feel that something may be lost in the transmission.

But I would like to say that one thing that our party can never be judged for is that we are devious with anything we ever did.

One

thing we are clear on: we are brutally honest with the facts, both in

an election and out of election. In fact, we are so plain with these

facts that it seems so horrendous that the truth could be so blunt and

that we are suspected of devious transactions. There are none. One

thing we have had in our 23 years of office is absolute truth in

government, and that can be proven continuously and forever. No one

should ever even suggest it, and I would defy anybody to recall a

statement we have made in the past that wasn't completely fulfilled. I

think that's a great record for our government, both this

administration and the one before.

MR. CHAIRMAN: I

would stop you now to remind you that we are in committee stage on Bill

section 5. The Chair has difficulty bringing members into order when

they stray from the rules of the House. Perhaps you could keep it in

committee.

MR. MUSSALLEM: Thank you, Mr. Chairman.

You are at your best when you are correcting me, but the fact is that I

am speaking to the point in question because it involves funds. It

involves a principle of government and I speak on the principle of

government, the principle of our party. Our honourable friends opposite

have made it very clear that our principles are not correct, so I speak

on the principle. I think it could hardly be denied that when I speak

about.... They say that our principles are wrong and I say that our

principles are right. They've always been right and they've always been

correct, and brutally correct.

MR. BARBER: Brutal anyway, Georgie.

MR. MUSSALLEM: Not brutal, brutally correct.

honourable friend from New Westminster is at his best also when he

speaks about Social Credit cards. It shows how little he knows about

cards. But let us talk about NDP cards. Let us talk about a letter

issued by Burnaby Teachers Association respecting the first member for

Vancouver-Burrard in which they wrote a letter to the teachers saying:

"If you will pay so many dollars, you'll get most of it back. Don't

hesitate to pay your money." Here was my honourable friend talking

about our party. We never did that. We were blunt. In fact, we said:

"If you pay to this party, we will give you credit in income tax by

legislation which will be developed." But this party, no, they said:

"If you'll pay us money for the first member for Vancouver-Burrard....

Interjection.

MR. MUSSALLEM:

I've got the letter. "If you pay money to us, we will see you get it

back, because don't forget, we've got a federal party. We'll channel

the money to them and we'll get it back, because federal contributions

are tax deductible." And they said we were devious. How devious can you

get?

I say it's totally dishonest, but I say that we were

right in saying what we did. It's time, after 25 years of government,

that we should say to the contributors to our party — the best

government British Columbia has ever had — "If you pay to our party we

will give you a tax deduction." We haven't been able to do it before,

but it's high time. I think it's only fair and honourable. We didn't

ask you to send it to a federal party and we'd channel it back. We said

bluntly: "Give us the money, and we will take it as an income tax

deduction when we pass the legislation, when we're elected again" —

which we were sure of being, and we were. So we kept our word; we keep

our promises. What's wrong with that?

Withdraw this section? Never. This is a proper and good section. I wish my honourable friends could be as honest.

MR. CHAIRMAN:

Hon. members, we once again appear to be having some difficulty with

the microphones. Would a recess be in order until such time as we can

make repairs? I shall summon the House with the ringing of the division

bells.

The House took recess at 3:39 p.m.

The House resumed at 4:18 p.m.

HON. MR. WOLFE: Mr. Chairman, before we recessed, we were

discussing the political contributions amendment to the Income Tax Act.

I was going to take the opportunity to explain, notwithstanding the

confusing comments from across the House, that we made our policy clear

during the budget speech that we were introducing such an amendment. To

the leader of each political party in this province I circulated

details of proposed regulations covering many of the questions that

have been raised in terms of the type of receipts that we required and

what the

definitions of various aspects of this proposal would be. This

was merely as a courtesy to all political parties, Mr. Chairman.

All

of these proposals are before us today in this amendment which has a

provision for regulations to support further details. All of these

matters were laid before each political party of this province

immediately after that budget speech. They were offered merely as a

proposal, not as a promise to anyone that there would be this type of

deducibility. They were patterned after the identical legislation of

the province of Ontario, Alberta and also the federal legislation.

Mr.

Chairman, I ask leave to table the letters which I addressed to all the

political leaders with the details I am now referring to. There may be

certain members here who have not been informed by their leaders or

have forgotten. I also circulated these matters to the press at the

time. I want members to be aware of the fact that there were no secrets

being made of these matters. This was a matter of full disclosure for

the benefit of any political candidate of any political party in this

province. That's the nature of the proposal we're discussing here. It's

patterned identically after the federal Act and the regulations that

are referred to would be similar in content in terms of the receipt

required and so on. I don't know if the proper procedure is to table

this.

MR. CHAIRMAN: The proper procedure would be to wait until such time as the committee has risen and....

[ Page 195 ]

HON. MR. WOLFE:

I will propose then to table these at the first opportunity. Once

again, this has been laid before all of the members for the purpose of

any candidate who was a contestant in the provincial election. The

letters I am referring to, dated April 12, are addressed to Mr. Vic

Stephens, leader of the Conservative Party; Mr. Jev Tothill, leader of

the Liberal Party; Hon. W.R. Bennett, Premier of the province of

British Columbia; and Mr. Dave Barrett, leader of the NDP.

April 17 there was a subsequent letter with further explanation. I want

all members to be aware of that when they are making comments.

MR. LEGGATT:

I haven't had the benefit of the letter that the minister is intending

to table apparently to assist us in the definition of a recognized

political party under the terms of

section 5. But I did want to ask him

a question.

The definition in this Act is: "a bona fide

affiliation of electors comprised in a political organization that has

as a prime purpose the fielding of candidates for election to the

Legislative Assembly." Am I right in assuming that a political party

may not even field a candidate and still qualify under this? It may be

that that political party is unsuccessful in finding sufficient

nominees to field a candidate in a provincial election. This is going

to open the door to a wide range of.... I'm not necessarily saying

that's a bad thing, Mr. Chairman, but I would like the minister to be

very clear on what a definition of a political party under this Act is

going to be.

I happen to have sat in committee in 1973 when

we were drafting the federal legislation and I can assure the minister

it was a very long and heated debate as to what was a political party.

Under present federal regulations you have to have 50 candidates in the

field, as I recall it, before you can register as a federal political

party.

So I'm wondering if the minister would mind

responding to those of us as new members who haven't had the

opportunity of examining this letter, which was apparently circulated

among the leaders of four political parties in British Columbia, as to

what is going to be a bona fide political party. Are we going to have

to rely on some regulations which can change from time to time in the

event the minister may not like the stripe of that political group that

wants to take the benefit of the Act?

HON. MR. WOLFE:

Please understand that the regulations are not yet approved. The

information I circulated defines a recognized political party to

include a constituency association of a recognized political party.

"Official of a recognized political party" means the treasurer of a

recognized political party, specially charged with receiving the amount

contributed and depositing in a financial institution of all

contributions to the recognized political party, and such other persons

as are designated by a recognized political party to receive

contribution, and whose names, addresses and signatures have been

recorded with the income taxation branch. We've got to provide a proper

definition of what is a recognized political party. That was the

definition circulated to the members at the time.

MR. LEGGATT:

I'm very pleased the minister has risen to assist us in this matter.

There's a clear admission here that we still don't have a definition of

what a bona fide political party is in the province of British

Columbia. That means, in effect, that by voting for this particular

section of this bill we're voting for a pig in a poke. We don't know

what definition is going to come forth; that definition will clearly be

by regulation and not by the Legislative Assembly.

It puts

in the government's hands a tremendous power to define in society those

groups they wish to be recognized political parties. It may be, for

example, that the Greenpeace organization might wish to field

candidates, and the government may be in a very anti-Greenpeace mood

for some reason or another. I'm very disturbed that we don't have

before us — not by regulation, not by letter, or any other way — a

clear definition of what is a recognized political party. Under the

federal law, it's specific. It's referred to in the Canada Elections

Act where there must be 50 candidates fielded across Canada before you

take the benefits of this particular Act. They did that in order to

prevent fringe parties from taking advantage of this.

recognize that it would be very hard for the Social Credit Party to

field 50 candidates across Canada. I recognize that is almost an

impossibility. They have been fortunate enough in the province of

British Columbia to get a full slate together. In any event, these

coalitions come, and go, and change.

Nevertheless, I think

the minister owes it to the people of British Columbia to tell us now

which is going to be a political party. I have some concern that in the

future it might be something other than Social Credit. There might be a

different name attached to this group. It may be that we would want to

know that group can comply with the law to take the benefits of that

law. It seems to me a minimum that we should ask there be a clear

definition of what is a bona fide political party. I recognize there's

a trend to try to support by legislation fringe groups like Social

Credit and these other groups. I accept that in a democratic society we

should help. No matter what kind of political ideas one has, we should

encourage them to come forward and participate in the democratic

process. But we may not want to carry that too far. Before we have the

opportunity of voting on this perhaps he would be willing to table this

particular provision so that we can have a clear definition of what is

a recognized and bona fide political party in the province of British

Columbia for the purpose of this bill.

HON. MR. WOLFE:

It's the same definition as would apply in the Constitution Act. For

instance, in

section 64 (4) it speaks of a special allowance for the

Deputy Speaker or leader of a recognized political party.

MR. GABELMANN:

If I heard the minister correctly — correct me if I'm wrong — there are

now two recognized political parties in British Columbia.

HON. MR. WOLFE: Are you referring to this House?

MR. GABELMANN:

Oh, no. My understanding is that the minister was suggesting that the

rules governing parties in this House would be the rules....

HON. MR. WOLFE: No.

MR. GABELMANN: He's not saying that. Then we're left with an unclear definition of what political parties are. I

[ Page 196 ]

wouldn't

be satisfied, as perhaps the member for Coquitlam-Moody (Mr. Leggatt)

would be, that we get that definition now. We need that definition

effective the date the legislation is effective. We need the definition

of what a bona fide political party is the same day the law takes

effect.

I understand that the minister circulated letters to

four political parties in this province. The implication of that is he

did not send letters to other political parties in this province.

HON. MR. WOLFE: I made them available to everybody.

MR. GABELMANN:

There might be other groupings in this province — there may have been,

had they known this kind of legislation was available to them — who

would have contested this last election. They were operating under the

law of the province. That law did not exist at that time; it cannot be

made retroactive. People were denied the rights that some political

parties that the minister decides are political parties — or did

decide, and he decided there were four.... That means there are

conceivably — whether it happens or whether it would have happened or

not doesn't matter — groups in this province who were denied the

benefit of legislation that four theoretically political parties were

allowed to have. That's the first point, and I think that point has not

been answered. We cannot have legislation affecting political parties

in effect before we know what political parties are.

The

second point, Mr. Chairman, is that the minister said that the person —

this is the first I've known about it — in the constituency or in the

party who would be responsible for the collecting of money and the

issuance of tax receipts, presumably, would be the treasurer of the

constituency association or the provincial association. The treasurer

of my constituency association didn't know that.

HON. MR. WOLFE: Speak to your leader.

MR. GABELMANN:

One of the things the treasurer of my constituency association would

have said to me is that the Socreds aren't going to win the election,

the NDP is, so we won't have that legislation on the books. And isn't

that a point, Mr. Chairman? How can one political party make election

promises that if they're elected there will be retroactive legislation

to do something or other, when other political parties might be

elected, and that legislation wouldn't come in? Where would the people

be who had contributed to the Social Credit constituency association of

Little Mountain, had received a receipt from the treasurer of the

Little Mountain Social Credit Party, and that legislation was never

again introduced in this House, nor ever passed? Where would the people

be then who were given those so-called tax receipts?

Mr.

Chairman, that kind of legislation cannot be introduced into this

House. I think the point has been made, and I would like the minister

to explain to me how he can rationalize his decision to pick four

political parties, and to deny that to others who might potentially

have been in the field had they known about this legislation.

HON. MR. WOLFE:

Mr. Chairman, I guess it doesn't pay to try to extend the courtesy to

candidates and members of the information on this proposal, that's all.

I would answer your question by saying that this same proposal was made

available to any political party or any other candidate who was not

included in the four parties. So it wasn't the intention to restrict it

to anyone. The information was made available on request through the

chief returning officer, who supplied it to any candidate who wished to

apply for it.

MR. GABELMANN: Mr. Chairman, those are

four political parties he is talking about, and he is relying on the

press in a province that did not have the major newspapers operating in

the election campaign to circulate the information to other groups of

citizens in this province who may have wanted to band themselves

together to become a bona fide political party. Also, he has not

answered the important question about what would have happened to this

legislation should his party not have received a majority in the last

election. What would then have happened to those tax receipts and those

people who contributed money under false premises?

HON. MR. WOLFE:

Mr. Chairman, I want to make it very clear that no promise was

extended. This was put forward as a proposal that may go forward —

simply that — and it is very clearly indicated as such in the

correspondence and in the proposed rules that might apply. No promise

was extended that this would apply. Obviously it is the intention now

that we have been re-elected to pursue this, and put through proper

legislation in this regard. But no promise was extended, and this

material, to the best of my ability, was circulated to all of the four

political parties as we know them in the province. And for the benefit

of any other candidate who would not fall under one of those banners,

it was made available through the returning officer for the province.

MR. HALL:

Mr. Chairman, I really am rather amazed that the minister would say no

promise was made. I myself saw promises made on television about the

income tax forgiveness aspect of this legislation. It was promised on

behalf of the Social Credit Party not on one but on two occasions. I

can't quite understand why he says there were no promises made.

But

let me deal with the specific issue that divides the Minister of

Finance and a number of people on this side. That is that surely to

goodness, in this day and age, and because of the importance of this

particular kind of legislation, we should see written in the definition

section a full and complete description of what is a recognized or

registered political party. He doesn't seem to agree to that. He wants

to see that in the regulations. We simply are not agreeing to that and

we're pointing out the hazards in terms of legislative drafting that

that will take us into. Surely there is one thing that the public of

this province should be expecting from its legislators, and that is a

clear and unequivocal definition of what a political party is.

HON. MR. WOLFE: What's your definition?

MR. HALL: You'll have your say in a minute. Now I've listened to you. You just listen to me for a few seconds.

The

minister, grabbing out of the air, said it will be the same definition

as the one in the Constitution Act. He doesn't know what he's talking

about. The definition in the Constitution Act has got nothing at all to

do with the

[ Page 197 ]

purposes

that are taken into account by the drafting of this legislation. Not

only that, but his own man, the Social Credit candidate for West

Vancouver, latterly a judge, now the author of the Eckardt commission,

says he wants to do away with that anyway. Whoever tabled the report

should check and send a copy to the Minister of Finance so he can read

it.

The Provincial Secretary has charge of two statutes in

which the words "political party" occur. Have you talked to the

Provincial Secretary about a definition of the words "political party"?

The answer is no. He obviously hasn't. So now we've got ourselves in a

position where we're going to have three statutes in front of us with

the words "political party" in them, but with different

definitions.

That's ridiculous, and I would say that to expect this Legislature to

blithely accept the promises of the Minister of Finance that somehow or

other he'll fix it up in the regulations, on such an important thing as

expenses, income tax, is really asking too much.

Mr.

Speaker, what's wrong with this legislation is that it comes on its

own; and as other speakers have said, it should be part of a package.

It should not only be part of a revised Elections Act, which has been

promised to us by the Provincial Secretary.... We're waiting for the

action of the Provincial Secretary, who wrung his hands on May 11 and

said it was obvious that there should be a new Elections Act. We're

waiting for that. We agree with the principle that is supposed to be

contained in this section, by the way, Mr. Minister, as we've said many

times, because we are the beneficiaries of it, in the federal sense. We

want to see you get your share of it. We want to see other people get

their share of it, and the only way they're going to do it is by

writing this

section correctly.

Thirdly, Mr. Chairman, if

you're going to have an election that tells you how to vote, and if

you're going to have an expenses Act that tells you how much money you

can spend, you should have a disclosure Act, a contributions Act and an

income tax Act that show where the money is coming from and where the

money is going. That's the three-part package to anything to do with

the democracy of us getting here. To come in here and whisper something

about "it works in Ontario or it works somewhere else," that doesn't

turn me on at all. We're doing our own thing here, Mr. Minister of

Finance, and we want to see a good Act. We want to see a first-class

Act and we're doing our level best to help you by trying to correct the

imperfections that are inherent in just simply saying "a recognized

political party" and you saying: "Oh, that's somebody who fields

candidates — a party that exists with a prime purpose, that of running

for election." That's not the way you do it at all. It should be in the

Act, not in the regulations. I don't want to wake up one morning when

the mailman comes and read in orders-in-council that suddenly on a

Tuesday afternoon, or a Tuesday morning, whenever you get into the

mahogany-lined chambers of the new executive council suite, you decide

to have a different thought about what constitutes a political party.

For all I know, there used to be a member for Saanich, there used to be

a member for Esquimalt, there used to be a member for Shuswap — Messrs.

Tisdalle, Bruch and Jefcoat — and they may want to start a political

party. I'd like to be in your deliberations as to whether you're going

to let them have tax benefits to come back here. All sorts of things

come to mind, Mr. Minister, and you and I remember those days.

think you should take this whole

section back and bring it back a few

months from now when you've had an opportunity to debate with the

Provincial Secretary as to what his plan really is, when you've had an

opportunity to talk to Judge Eckardt and find out what his plan is, and

then bring in all the legislation together so we can have a look at it.

HON. MR. WOLFE:

Once again, the definition is in the Act, Mr. Chairman — "recognized

political party — page 2 of the Act. It means "a bona fide affiliation

of electors comprised in a political organization that has as a prime

purpose the fielding of candidates for election to the Legislative

Assembly." So it's very clearly in the Act now. If there are problems

that develop in terms of that definition as it applies in other

provincial Acts, I'm sure they can be dealt with.

MR. HANSON:

In my first speech in the Legislature I tried to point out to the

government that the people of the province aren't happy with the

electoral process as it is presently constituted. They are not happy

with the fact that they have difficulty voting, that we don't have

proper election expenses legislation here in British Columbia.

Notwithstanding the technical objections that we have regarding how to

define a political party, those are important concepts.

One

of the first principles of democracy is the ability of citizens to

organize themselves in opposition to a government. That is a right. The

people in this gallery, if they object to the performance of the

government and the opposition, have the democratic right to organize

themselves in opposition to this setup. The question before us is

whether they would qualify for funding under some kind of democratic

process.

I need not point out to you, Mr. Chairman, that

there are hazards inherent in not having proper funding for political

parties. What we have are large expenditures by third parties, by

third-party supporters, concerned citizens' groups, corporation fronts

and various other front organizations that put large amounts of money

into political campaigns. What I am trying to say to the government is:

please be sensitive and aware of the fact that the people of the

province are crying out for electoral reform. They want disclosure;

they want to know who is supporting political parties; they want

limitation on expenses; they want to be able to vote. If the present

government does not pay attention, is not cognizant of those feelings,

tries to force through a

section that....

We know why it is

there. You — through you, Mr. Chairman — want to have access to the

refunds that are available to us in the federal House. I want you to

have that too. I think you deserve it, as does any political party. But

you propose to put through a

section like this just to qualify for

expenses, and not pay attention to disclosure as it was outlined by my

colleagues, and all the other very, very important concepts that must

be built into this bill. I would urge the minister to withdraw it.

MR. NICOLSON:

Mr. Chairman, this bill is hastily drawn. One would expect that the

minister, having promised such legislation many months ago, would have

had the opportunity to draft something in a more proper form.

[ Page 198 ]

One

of the other concerns that we have with this bill is that it is

retroactive; and, in fact, promises were made. Erskine May is actually

quite forthright in terms of talking about election campaigns, and what

constitutes bribery during an election campaign. It was resolved in the

House of Commons that it is highly criminal in any minister, or

ministers or other servants under the Crown in Great Britain to

directly or indirectly use their powers of office in the election of

representatives to serve in Parliament. Yet there were promises made —

highly criminal.

In order that this House not implicate

itself in something that could be in any way tied in with this type of

action, I would propose the following remedy. I would move the

following amendment to

section 5(5), line 2: by deleting "April 2,

1979" and substitute "June 8, 1979."

MR. CHAIRMAN: The amendment appears to be in order.

On the amendment.

MR. NICOLSON:

I think that it's very important that while normal items contained

within a budget speech have force and effect as of the date on which

they're introduced, and things such as sales tax would come into effect

on the evening of such a change, in a case such as this, where a form

of modification of income tax which would allow for the rebate of

portions of donations made to political parties was made almost

provisional upon the return of a certain party to power.... I just

think that it is so patently obvious that this is wrong, that the

government is probably a little bit uneasy about it, that the

government would hope that the opposition would almost forget about

this and treat this very fundamental transgression as something

unimportant. Mr. Chairman, I'd like to assure you that we feel it is

not unimportant. For a measure such as this to become part and parcel

of the campaign which has just passed and to be supposedly legitimized

retroactively is totally unacceptable.

Mr. Chairman, it

can't take effect for that last election. There were no forms made

available. How were persons to conduct themselves during that campaign?

Did the agents have forms? How could they have forms? How could

regulations be made when the Act was not even enacted? While it's

common and accepted practice that increases in tax or decreases in tax

have effect usually immediately at midnight after the reading of a

budget, in fact, Mr. Chairman, this particular legislation can in no

way with any modicum of decency be allowed to pass unless it is amended

to remove the offending section, which is a

section which would be

retroactive — not to some previous period in this thirty-first

parliament, but going back even into the thirtieth parliament. One

indeed might, ask, since probably parties have records, that it be made

retroactive to the 1975 election.

It's obviously a very bad

move and it is a move that can be rectified by this very simple

amendment. I know that on one occasion the minister did accept an

amendment which put a sunset provision in

an Act. He did accept one of

my amendments, and I hope that the Minister of Finance will use that

same good judgment and accept this very simple and modest amendment.

MR. LEA:

Mr. Chairman, I speak in favour of this amendment. I think we have to

examine why this

section of the Act is in front of us in the first

place. Did the Liberal Party need this

section in order to qualify for

an income tax deduction during the last election? The answer is no. Did

the Conservative Party need this change in order to qualify for an

income tax break in the last election? The answer is no. Did the New

Democratic Party? The answer again is no. What is the one and only

party that had to have this in order to get an income tax break for

contributors to a political party for the last election? You're

absolutely right. The only political party is the Social Credit Party.

this is

an Act that favours one political party. However, I wonder if

the minister could tell me, Mr. Chairman, whether this gives the New

Democratic Party an even bigger break than he'd thought of? Can we, for

instance, apply under the federal Act and then apply under this

provincial Act and get a double?

MR. CHAIRMAN: Hon.

member, can I have your attention for a moment, please? Your line of

debate would be more in order under

section 5 rather than under this

specific amendment that we're on right now, just for this 38-day period.

MR. LEA:

No, Mr. Chairman, I'm trying to point out why this amendment should be

accepted by the minister and by the government, because what we've been

doing is sort of beating around the bush. The Social Credit needed some

money for the last election. One of the ways they thought of getting

money that they couldn't get hithertofore was to go out and to bribe

the people. That's what they were doing. They were doing nothing more,

nothing less than attempting to bribe the voters and the supporters of

Social Credit prior to legislation coming in this House.

In other words, they were prejudging....

MR. MUSSALLEM:

I would like to bring up a point of order afterwards, but I will not

stand for our party being called "bribery." That is simply out of the

question. I will not allow that. That must be withdrawn.

MR. CHAIRMAN: The member finds the word offensive. Would you please withdraw'?

MR. LEA:

Well, Mr. Chairman, in the history of the British parliamentary common

law, Social Credit is the only party that had a minister go to jail for

bribery. So I don't know why they're so concerned and worrying about

their morality now.

MR. CHAIRMAN: Hon. member, nonetheless, if a member finds a word used in the House offensive....

MR. LEA:

That's the member's problem because it was pure, out-and-out bribery.

It was pure, out-and-out bribery to go out and prejudge what this

Legislature was going to do with a piece of legislation. What the

government did was take all of you new members over there and say:

"When you come to this Legislature, you're going to vote exactly the

way we tell you."

Interjection.

MR. LEA: Okay? Okay, then where would the government's Act be right now if you didn't vote exactly

[ Page 199 ]

the

way they told you'? Where would they be then? They were not only

prejudging what this Legislature was going to do; they were prejudging

what their new members would do. They had to do as they were told —

vote and shut up. That's exactly what they're being told right now.

"Vote, shut up, and go back to your riding."

[Mr. Davidson in the chair.]

What

we have are two things: first of all bribery, and now blackmail. Those

are the two ingredients that make up this piece of legislation that we

have in front of us.

You go out to the public and say: "Vote

for this political party and when we get in power, we're going to make

it so you pay no income tax at all. None. We're going to wipe out your

income tax, but don't tell anybody. Oh, by the way, we did make a

little press release about it, but we didn't let a number of people

know in the province. We hope they found out about it so they can vote

for this political party too.''

You can't do that, Mr.

Chairman. You can't do it in all good conscience, and I don't think you

can do it under the constitution. As the member for Nelson-Creston (Mr.

Nicolson) pointed out, in other Houses it is classified as a criminal

act to do what this government has done.

Interjection.

MR. LEA:

Is it in this House too? I would be very surprised if it weren't. So

really what we're doing is taking a look in British parliamentary

practice at a criminal act. We're going to allow that government, not

you people down there, to go into the seclusion of a cabinet room and

decide what is going to be a political party in this province. That's

what they're going to decide by regulation, not by legislation.

can't stop it, Mr. Chairman. They have more members than we have. But

for those new members over there to allow themselves to be blackmailed

and to be told how they're going to vote before they even get to this

House is a little bit much to swallow. If they hadn't been sure of the

way you're going to vote in this House and predetermined how you're

going to vote in this House, then they could not have made that promise

in the first place.

How can the government go out and make a

promise that they can't deliver? The only way they can deliver it is to

know beforehand how you're going to vote, and to know how you're going

to vote beforehand is collusion in this House, blackmail in this House

and bribery in this House. That's what it is. Now that's what it is,

Mr. Chairman, and I don't care what other brush you stroke it with.

That government and that political party is guilty of bribery,

blackmail and collusion. That's what they're guilty of with this piece

of legislation.

There's no other word for it because only

one political party gains from the previous election and that is the

Social Credit Party. This should be called the "Social Credit clause"

because it only helps one party and the supporters of one party. It

helps no one else because of its retroactivity. They've got the nerve

to come in this House and try to put it forward as some democratic

process. It's not a democratic process when you pass a retroactive

piece of legislation that only helps one political party. It's any

rotten name you can call it. Call it that, because that's exactly what

it is.

HON. MR. MAIR: Mr. Chairman, I clearly heard

implications of wrong conduct imputed to members of this side of the

House, the government in general, and specifically members of the

cabinet, and members of the Social Credit Party. I ask the member to

withdraw those imputations and implications.

MR. CHAIRMAN:

Hon. members, while temperate language is always encouraged in the

House and the specific naming of members and impugning of those members

is not condoned, there is nothing in our books that indicates that the

impinging of a party per se and not specific members is not allowed.

However,

it is incumbent on all members to use temperate language and if that is

followed, then we do not arrive at the position we are at this time.

Further, if members would address the Chair and refrain from the kind

of overuse of such terms, the proceedings of this House would go much

further and the stature of this House would likely increase.

HON. MR. MAIR:

With the greatest of respect, Mr. Chairman, I didn't complain about the

member impugning bad conduct to a political party. He impugned members

of this House and the members of the government vis-à-vis the caucus of

this party sitting as hon. members in this House. It was that to which

I objected.

MR. CHAIRMAN: If that is the case then

that is withdrawable. If the previous speaker the member for Prince

Rupert (Mr. Lea), did impugn specifically any members of this House,

would he make such withdrawal at this time?

MR. LEA: Mr. Chairman, you know I didn't specifically do that. I only did it to groups, and that's allowed under the rules.

MR. CHAIRMAN:

No, hon. member. Again we are talking about members of this House, and

I would simply ask that if any particular member or members of this

House were indicated, would you withdraw any such indication?

MR. LEA:

You are making it very difficult, Mr. Chairman, because they did what I

said. Now you want me to take back something that is true?

MR. CHAIRMAN: Hon. member, I would ask you please, if such imputation were made, would you withdraw such imputation?

MR. LEA: They were not made.

HON. MR. MAIR:

With respect, Mr. Chairman, they were clearly made, and the member

opposite can’t get out of it by saying they weren't made. He alleged a

course of conduct between the government of this province and members

of the caucus. He then characterized it as ''bribery, blackmail" and

other words to that effect. I suggest that must be withdrawn. Mr.

Chairman. with the greatest respect.

MR. CHAIRMAN: Thank you. Hon. members....

[ Page 200 ]

MR. LEA: If the shoe fits, wear it.

MR. CHAIRMAN:

Order, please. Hon. members, I will read from Sir Erskine May,

nineteenth edition, page 430: "Abusive and insulting language of a

nature likely to create disorder." Now I can hardly think of more

appropriate words than "bribery" and "blackmail," and I would ask again

that if the member for Prince Rupert specifically indicated any member

of this House, or impugned any members of this House, would he then

please withdraw that imputation?

MR. LEA: Well, you are absolutely right. I did, and I withdraw it.

HON. MR. HEWITT: Mr. Chairman, I am going to speak against this amendment.

The

hon. member for Nelson-Creston (Mr. Nicolson) has put in: "by deleting

'April 2, 1979,' and substituting 'June 8, 1979'." The strategy is that

those people who contributed to the provincial Social Credit Party

don't get relief by getting a reduction in their income tax for this

year, and would have to wait until the next election.

There's

a party which is supposedly for the people. We all come into this House

representing our constituents, and everyone over there represents a

constituency. I would think, in fairness, not just to the Social Credit

member who contributes to a political party on a provincial basis, but

in fairness to their members, they should consider that the bill should

be effective prior to the last election of May 10.

Let me

tell you why. We always complain about the federal government watering

down our income tax that is paid back to the province. What's probably

happening to a lot of their members over there is they make their

contribution, and then the federal NDP, that national party, allows the

funds to come back into the province. Maybe you, as members, as

candidates, aren't getting the benefit of funds which were directed to

you. Perhaps your federal party that looks after the income tax

receipts takes a little bit from you.

But I think it is

pretty cheap; I think it is pretty shoddy that representatives of a

party whose members and supporters get the benefit of income tax

reduction would not look and say that all people of British Columbia

should be treated equally.

There's a party over there that has gone around this province to everybody,

saying: "We're for all the people, and we're looking after all

the people" — not just the millionaires that they accuse us of getting

support from — "all the people."

This

amendment indicates the two-faced effort of the NDP opposition. Instead

of looking at all British Columbians as having equal opportunity under

the legislation that is passed in this House, they are prepared to say

one more time, "Well, delay this to June 8," knowing that June 8 is a

date picked out of the air.

Why don't you stand up and say

that? Why don't you stand up and admit that's what you're doing? It's a

cheap trick. I'd just like to say that this type of amendment, this

type of debate, in this House, is a shame. This House is supposed to

represent all the people and do things for the public good instead of

discrimination against people who feel they want to support the private

enterprise opportunities for individuals in this province, as opposed

to power groups you people represent. I think it is shameful, and it

should be withdrawn.

MR. BARRETT: The member who has

just spoken has overlooked a simple little thing that this amendment is

designed to clear up. The fact is that the minister raised this issue,

in correspondence to me and to other political leaders, in the middle

of an election campaign. The letter I received was dated after the writ

had been issued for an election campaign. Is that not correct, Mr.

Minister?

HON. MR. HEWITT: I'll be tabling it.

MR. BARRETT:

I'm sure you will; if you don't I will. Acting as a minister of the

Crown, that minister wrote to me about campaign funds. He said: "If you

vote Social Credit, it is our intention...." You said if you're

returned to office it's your intention....

HON. MR. WOLFE: Quote it correctly.

MR. BARRETT:

Was it not your intention, if returned to office, that you would bring

in legislation to allow people to deduct donations to a political party

from their income tax? Is it not true that was the intent of the

letter? Just nod your head. Certainly the way I read it, it is the

intention of the government to have this amendment apply to the year

1979. And there's your name attached to it. Is that not your intention?

Were you fibbing in this letter?

Now we have the pious

statements by the member for Penticton, who says: "We just want to be

fair. " If you want to be fair, you should have brought in the bill a

year ago. Bring in the bill now under the amendment. But there is a

serious charge, levelled by my colleague from Prince Rupert, that can

be substantiated in exactly the words he used. It is parliamentary,

indeed, under the Constitution Act. I refer you, through Mr. Speaker,

to the provincial Constitution Act, sections 162 and 163. For my

friends the lawyers, I'd like to read this

section so they'll

understand what this particular amendment is attempting to deal with.

Section 163:

"The following persons shall also

be deemed guilty of bribery and are punishable accordingly: Every

elector who, before or during any election, directly or indirectly, by

himself or by any other person on his behalf, receives, agrees, or

contracts for any money, gift, loan, or valuable consideration, office,

place, or employment, for himself or for any other person, for voting

or agreeing to vote, or for refraining or agreeing to refrain from

voting, at any election. "

Is this not a promise of a

contract? Is this not a statement saying: "If you vote for us it is our

intention in the government to have the amendment applied to 1979, if

elected?" Is this indeed not open to a charge of the violation of the

Elections Act, under this section, by bribery? I use the word in all

modesty only, to quote from our own legislation, not with any intention

of accusing anyone of anything. Read the whole of

section 162:

"Every

person who, directly or indirectly, by himself or by any other person

on his behalf, gives, lends, or agrees to give or lend, or offers,

promises, or promises to procure, or to endeavour to procure, any money

or valuable consideration to or for any

[ Page 201 ]

voter, or to or for any other person, on behalf of any voter,

or to or for any person in order to induce any voter to vote or refrain from

voting, or corruptly does any such act as aforesaid on account of any voter

having voted or refrained from voting, at any election. "

this was ever an inducement to give money, in violation of the Act,

what more do you need? It's an inducement to vote for Social Credit.

This letter was written April 12, after the campaign started,

assuming....

HON. MR. MAIR: What

section of what Act are you referring to?

MR. BARRETT: The Provincial Elections Act.

SOME HON. MEMBERS: Oh, oh!

MR. BARRETT:

There is a

section in the Constitution Act which deals with this too.

But I am quoting now, first of all, from the Provincial Elections Act.

AN HON. MEMBER: You said the Constitution Act.

MR. BARRETT:

Yes, thank you. I command the interest of one of the lawyers in the

House. Sections 162 and 163. This letter was written after the writ was

issued. Presumably some people gave money to Social Credit before this

letter was written. If that is indeed the case — or they were

hesitating giving money to Social Credit and they got elected, they

would get a tax rebate. This is indeed influencing the vote; it's

making a promise.

HON. MR. HEWITT: The same way as you did with the natural gas price.

MR. BARRETT: I didn't hear you, sir.

MR. CHAIRMAN:

Order, please. I must ask the Minister of Energy, Mines and Petroleum

Resources and Agriculture to restrain himself until such time as he

might participate in the debate.

MR. BARRETT: This is a letter dealing specifically with campaign donations to a political party.

AN HON. MEMBER: To all political parties.

MR. BARRETT:

To all political parties — and it is signed by the Minister of Finance.

It says that if you give money during an election campaign, it is the

intention of the government to have this amendment apply to the year

AN HON MEMBER: To all political parties.

MR. BARRETT:

So what? It's your party and every other party being told in the middle

of an election campaign that a promise is being made for return of

funds.

Now if you believe that your hands are clean, that

you make no promise and that this letter does not offend the Elections

Act, then don't make the legislation retroactive. The amendment is

perfectly in order, not only with Sir Erskine May but with our own

legislation.

What could stop a citizen from laying a charge

against the government under

section 162 or

section 163? Nothing. This

letter is all the evidence one would need that a promise is being made.

Is this letter not a promise? It certainly is. I quote: "It is the

intention of the government to have this amendment apply to the year

1979." It's bribery and it's a promise according to the definition in

our own Elections Act. The only way to avoid that is to accept this

amendment.

I ask my good friend the member for Kamloops

(Hon. Mr. Mair): as he reads this section, does he not think that he's

being compromised by the minister's promise?

HON. MR. MAIR: No.

MR. BARRETT: Well, I won't hire you as a lawyer.

HON. MR. MAIR: I wouldn't accept your case.

MR. BARRETT: Are you going to get any money back from your campaign headquarters. In terms of any donation you made to your campaign?

HON. MR. MAIR: I didn't make any.

MR. BARRETT: You didn't make any donations?

HON. MR. MAIR: No.

MR. BARRETT: Well, I want to know.

MR. CHAIRMAN: Order, please. Please address the Chair when speaking.

MR. BARRETT: Did any cabinet minister give any donation to his own election campaign?

MR. CHAIRMAN: Hon. member, this is not the appropriate time for....

MR. BARRETT: Why not?

MR. CHAIRMAN: We are on the amendment to a bill. In any event, the Chair cannot entertain questions of that order.

MR. BARRETT:

Did the minister give any money to the Social Credit Party in the last

election? It's not against the law. Did the minister give any money to

Social Credit to further the campaign of Social Credit for himself or

for the party? That's a fair question.

HON. MR. MAIR: I don't think I did, you know.

MR. BARRETT: You don't think you did. Well, you're clean.

HON. MR. MAIR: I've been thinking about it and I don't think I did. I didn't need to, Dave.

MR. BARRETT: I'm now asking the Minister of Finance if he gave any money to Social Credit during the election campaign.

[ Page 202 ]

HON. MR. MAIR: Dave, get back on the amendment, will you? You're so far out in left field you don't know what you're doing.

MR. BARRETT: The amendment deals with making it retroactive.

Under

sections 162 and 163 of the Elections Act, the minister is clearly

violating the Act, because he's benefiting himself if he passes this

legislation. He'll put in for a tax rebate himself.

It's

obvious that a promise was made during the election campaign that if

you vote Social Credit it is their intention to bring in retroactive

legislation to cover campaign donations to political parties. That's a

bribe and that's a promise, as defined by our Elections Act. I say to

you, Mr. Chairman, that the minister, wittingly or otherwise, bribed

and promised voters of this province that if they donated money to a

political party during the election campaign and if Social Credit were

returned to office, they would get a tax benefit back for that donation

to that political party, whichever party it may be. Otherwise why would

this letter say clearly that it was the intention of the government to

have this amendment apply to the year 1979?

HON. MR. MAIR:

On a point of order, Mr. Chairman. I've been trying very hard not to

infer from the Leader of the Opposition's words any imputation of

wrongful conduct, but I am unable to do so and I must assume that he is

implying unlawful conduct. I must ask him to withdraw.

MR. BARRETT: Withdraw what?

MR. CHAIRMAN:

Hon. members, it may be necessary for me to peruse the Blues, but I

think, if I'm not mistaken, that the member speaking said something

that implied directly that the minister was involved in a bribe, and

that, hon. member, as you well know, is unparliamentary. So I would ask

that you withdraw that particular statement.

MR. BARRETT: I withdraw the word "bribe," but I don't withdraw the word "promise."

MR. CHAIRMAN: That's quite in order. Please continue.

MR. BARRETT:

Thank you. Now the Act clearly says that: "...any person who directly

or indirectly by himself or any other person on his behalf gives, tends

or agrees to give, lend or offer promises, or promises to procure or

endeavours to procure any money or valuable consideration to or for any

voter is guilty of an offence against this Act." The minister promised

money would be returned by way of benefit on income tax amendments if

Social Credit was elected. Now the Act defines that as a bribe and a

promise. However, through your ruling, Mr. Chairman, I will withdraw

the word used in the Act, this terrible, nasty Act that has the word

"bribery" in it that cannot be used in this House. They should take

all of the copies of this legislation with the word "bribery" in it out

of this House. Such an unparliamentary word appearing in our

legislation is an offence against this House.

AN HON. MEMBER: It's how you use it.

MR. CHAIRMAN:

Order, please. Hon. member, I'm sure that you are misinterpreting the

remarks of the Chairman, and I'm sure you're well aware of the intent,

and that is that we cannot have a member saying that another member

bribed someone or was involved in bribery. The word "bribery" in itself

is not unparliamentary, and I am sure that the member is well aware of

that.

MR. BARRETT: Well, Mr. Chairman, we will

dispense with the word bribery, because we find that offensive, but we

agree that the minister promised something.

AN HON. MEMBER: No. When did he say "promised"? Read it.

MR. BARRETT:

He promised, as he said in here, that on budget day a bill to amend the

Income Tax Act was introduced in order to provide for deduction for

provincial income tax of political contributions in respect of British

Columbia provincial elections. All right, but the bill was never

debated, never passed, it was not law. So what did you say in the next

paragraph'? Because it was not debated, because it was not passed,

because it was not law you said this: "It was the intention of the

government to have this amendment applied in the year 1979." Well,

good for you! We love your good intentions, but we know what road is

paved with good intentions.

AN HON. MEMBER: The road to heck!

MR. BARRETT:

You bet your life! I'm glad you're parliamentary. Intentions are not

legislation, Mr. Chairman, and a promise to provide legislation that

gives tax relief for political contributions, in my opinion,

contravenes a number of sections of the Provincial Elections Act. The

way to avoid this is to support my colleague's amendment. Otherwise,

any citizen in this province can justly say that there appears to be a

case of bribery under

section 162 and 163 of the Provincial Elections

Act, a case of bribery that could be made in the courts against certain

government members. How's that?

HON. MR. HEWITT: Terrible!

MR. BARRETT: It is terrible; you bet your life it's terrible. It's crass.

MR. CHAIRMAN:

Hon. member, bribery by certain government members would be the same as

bribery by a government member or any member of this House. I know

there's going to be some difficulty in doing so, but I would ask you to

withdraw that as well.

MR. BARRETT: Well, Mr. Chairman, let's turn our attention, then, to

section 178.

MR. CHAIRMAN: Could I have a withdrawal first'?

MR. BARRETT: Withdrawal of the Act?

MR. CHAIRMAN: No, hon. member, I am quite sure you know what I'm asking you to withdraw.

[ Page 203 ]

MR. BARRETT:

I withdraw any connotation that offends any member of this House of the

use of the word "bribery." I withdraw that unequivocally. I only refer

to the word bribery as defined in

an Act of this House.

Now,

Mr. Chairman, I refer you to

section 178 of the Act: "No direct or

indirect contribution or other thing of value for use of political

purposes or for election or campaign purposes within the province shall

be made or contributed by any person within or without the province

corruptly or in consideration of any promise thereof." There it is,

defined again — "promise thereof."

Mr. Chairman, I would

think that to avoid charges against the minister, intemperate use of

the word ''bribery" in this House, and other and sundry problems that

we may run across, it would be useful for the minister to clearly point

out, with some virtue, that he accepts this amendment so that no one

would leave this House with the impression that Social Credit, through

the minister's letter, was somehow attempting to induce people to

support Social Credit with a promise that if they were elected, they

were going to get money back from their income tax.

Now the

test of any argument, other than the hearty approval of the member for

Yale-Lillooet (Hon. Mr. Waterland), the test of any argument....

Interjection.

MR. BARRETT:

It was the cleverest statement you’ve made in three years, Mr. Member.

It would be worthwhile to consider what would happen if the NDP had

made this promise and we made the legislation retroactive after having

made this promise. I am sure my learned friends over there would be up

yapping their heads off saying: ''That's retroactive legislation; it’s

political bribery.'' And our Chairperson would have to say: "You can't

use that word 'bribery.'"

HON. MR. HEWITT: I'd be more concerned if you passed legislation without being the government.

MR. BARRETT:

It's all part of a sleaze. This government will say anything and do

anything to get a vote or to influence voters. What further evidence do

we need than the minister's letter? Stand up, Mr. Minister — through

you, Mr. Chairman — and tell us you accept the amendment so that

there'll be no misinterpretation of your intention. Stand up and tell

us that you don't want to violate our Elections Act, sections 162, 163

and 178. Stand up — through you, Mr. Chairman — and announce how many

cabinet ministers gave money to Social Credit, knowing that this

legislation would be retroactive and they would benefit from their

actions. Tut, tut!

The minister has obviously been involved in a violation of the Act, as far as I'm concerned.

MR. CHAIRMAN: Order, please.

MR. BARRETT: Oh, you don't like that, eh?

MR. LEA: Let's let a judge settle it.

MR. BARRETT:

Let's let a judge settle it. Let's take it to court. Let's ask a judge

to settle whether or not indeed this letter constitutes a violation of

the Elections Act and then if the judge says it doesn't, let's pass the

bill without the amendment. And if a judge says it does then let's pass

the Act with the amendment. Let's be fair. I challenge the government

to hoist this bill and take this matter to a judge and ask for his

opinion on whether or not the House is acting properly. Is there anyone

against that? Nothing is fairer than asking the government itself to go

to court and ask a judge to rule. Perhaps Mr. Eckardt is busy; perhaps

we could find another judge. Perhaps we could find another judge — say

a federally appointed judge.

MR. STRACHAN: Mr. Berger?

MR. BARRETT:

That's not a bad name. But I don't think it would be wise to go to him.

After all, he has a political background, unlike Mr. Eckardt's. Mr.

Eckardt's political background is different from Mr. Berger's.

challenge the minister to take this to a court or to a judge and ask

his opinion on it. It's more than just a little bit of fun in here and

giggles by the back bench. There is an important principle involved

here, and that is the

interpretation of the Elections Act. If this

government is concerned about people having a good view of politics and

politicians, then have the courage to take this Act and your letter to

a judge and ask for that judge's opinion on whether or not it should

stand or it should go as amended by my friend from Nelson-Creston (Mr.

Nicolson.) I believe that all along — and nothing will change my

opinion on this unless a judge gives a different ruling — that indeed

your letter violated, if not the law, the spirit and the intent of the

law in the Provincial Elections Act; and you know it all the time. I

think it does constitute a promise as defined under a

section of this

Act; and I use the word ''promise," not bribery, even though they mean

the same thing in this Act.

MR. SMITH: We should be

indeed grateful to the hon. Leader of the Opposition for his judicial

interpretation of that section. If that

interpretation is correct, then

the two members for Victoria are both in violation of

section 162 of

the Elections Act. I recall that both had advertisements in the

newspaper urging people to donate money to their campaigns and avail

themselves of the tax deductions that were promised.

MR. BARRETT: Federal tax deductions: existing law.

MR. SMITH:

Fortunately, Mr. Chairman, the Leader of the Opposition doesn't know

how to read the Elections Act because the operative words are not a

promise....

MR. HANSON: On a point of order, I would like to clarify for the member for Oak Bay–Gordon Head (Mr. Smith)....

MR. CHAIRMAN: You must state what your point of order is.

MR. HANSON:

I want him to withdraw that remark. He's referring to a federal

statute. He made accusations that we were in violation of some statute

and we were certainly not; it's a federal statute.

MR. CHAIRMAN: To the second member for Victoria: I had some difficulty understanding what you would like me

[ Page 204 ]

to ask him to withdraw. Is it an offensive statement? Would you withdraw?

MR. SMITH: If that's the purport of my remarks, I certainly withdraw them.

MR. CHAIRMAN: Thank you, hon. member.

MR. SMITH:

Mr. Chairman, I don't know how they could possibly request donations

under a federal statute when funds raised under a federal election

expenses Act can't be used for provincial political purposes. They must

have been referring to legislation that was coming provincially.

SOME HON. MEMBERS: Read the Act.

MR. SMITH:

Mr. Chairman, they have not read

section 162 of the Provincial

Elections Act in its entirety. It doesn't make it an offence to promise

valuable consideration; it makes it an offence to do that in order to

induce someone to vote or refrain from voting. Nothing like that is

done in that letter.

MR. HYNDMAN: Mr. Chairman, I

would like to make just a few comments against the amendment, in effect

in support of the legislation as proposed by the minister.

think the first good reason why members should reject the amendment is,

of course, the marvelous consistency with which it is made. We didn't

hear these impassioned arguments when we dealt with further removal of

the corporation capital tax, which had a retroactive clause. There's a

good reason for that, I suspect, and I will refer to it. And the second

member for Vancouver East (Mr. Macdonald) gave us a very impassioned

plea for retroactivity on the sales tax question, while he admitted

that as a practical matter sales tax announcements had to be made

forthwith. He gave us a very impassioned set of remarks as to why that

should nonetheless have been deferred. But to our great surprise there

was no amendment there.

The first further reason why the

amendment should be rejected is that, as the member for Oak Bay–Gordon

Head (Mr. Smith) has inferred, the members of the NDP have got to be

saved from themselves. It is probably known to the two members for

Victoria that one of the federal Liberal candidates for Vancouver

Island has officially written the federal elections officer, asking for

an inquiry into this whole question of NDP supporters and NDP

advertisements during the provincial campaign purporting to raise

provincial political campaign funds through the mechanics of the

federal legislation. Before anybody says, "Read the legislation," I

would suggest there is a serious inquiry underway, and I think that

this House would be doing the NDP a great service in saving them from

themselves by passing the legislation as proposed by the minister, and

thereby giving a safe haven to those zealous members of the NDP who

perhaps walked a little afoul of the federal legislation.

Now

we've had another lecture from the Leader of the Opposition (Mr.

Barrett) on judges and juries. Mr. Chairman, I think that the most

important judge and jury in this province, the people, have voted on

this proposition as part of the minister's budget, and those returns

and that jury have come in, quite properly. But, you know, there's a

real reason — and this is the essence of my short point — not mentioned

why our friends in opposition are against the proposal of the minister,

a reason why they don't want it retroactive. How conveniently and how

cleverly in their remarks they've overlooked the fact that, as proposed

by the minister, this credit, this deduction, is also available to

people who provincially supported the Liberals and the Conservatives.

The reason is that if there is a coalition for power in this assembly,

it now sits on your left in that party which now has a vested interest

in being the only monopoly in opposition in this province. They would

just love the people who voted Liberal provincially to be kept down, to

keep that tied up. They know that if the people who voted Liberal

provincially and paid a little money and wanted a tax credit and find

it taken away.... Some of those people are just going to say: "Well,

gosh, maybe it wasn't worth