May 2, 2000 Alberta Hansard 1253 Legislative Assembly of Alberta Title: Tuesday, May 2, 2000 8:00 p.m. Date: 00/05/02 [Mrs. Gordon in the chair] THE ACTING SPEAKER: Please be seated. head: Government Bills and Orders head: Second Reading Bill 18 Alberta Personal Income Tax Act [Adjourned debate May 1: Mr. Magnus] THE ACTING SPEAKER: The hon. Member for Calgary-Buffalo. MR. DICKSON: Thank you very much, Madam Speaker. I’m pleased to be able to speak to Bill 18, the Alberta Personal Income Tax Act.

I’d start off by saying that every year I typically do an annual report to constituents, and just a few weeks ago I’d sent out about 25,000 copies of this annual report to the residents who live in downtown Calgary. What typically happens is that I highlight some of the legislation being debated and encourage feedback either directly or through the web site at www.garydickson.ab.ca.

It’s useful because then when I roll into this place to speak to a bill such as Bill 18, the Personal Income Tax Act, you have a sense of at least what some of your constituents are feeling, thinking, believing with respect to that legislation. What I wanted to do was share some of that feedback that I have received with respect to Bill 18. Now, I’d also asked a series of questions, and I do this every year. It’s fascinating because constituents respond. They e-mail and fax and phone. Sometimes they come into the office.

They’ll tear off part of the annual report and fill it in with some comments, Madam Speaker, in terms of the things they thought were particularly important. I think I might stop and make the general observation that, you know, in its own way Bill 18 has as much public interest and concern as we’ve seen registered around Bill 11. MR. DUNFORD: Crank it up. MR. DICKSON: I’m receiving some terrific encouragement from the Member for Lethbridge-West. He encourages me to “crank it up,” Madam Speaker.

I was going to make this a very low-key presentation, and in fact I was planning on trying to strip this commentary of as much hyperbole as I can possibly shed and focus on the concerns of residents in Calgary-Buffalo. I’m going to continue to do that. As much as I’m encouraged by the Member for Lethbridge-West to take off, I’m going to try and focus on those concerns I’ve heard.

The concerns I’ve heard from residents in Calgary-Buffalo that have chosen to respond are, as is always the case, a variety of perspectives and opinions, but those who have chosen to respond on the flat tax have said, if not unanimously at least in overwhelming numbers, Madam Speaker, that they are very much concerned with the notion of a flat tax. They understand – and this is what they tell me – that what you’re doing is shifting the tax burden to lower income Albertans.

There are some people at the very bottom end in terms of income who arguably are going to see an increased exemption and some benefit, and that’s true. I think of all those middle-income Albertans who stand to get some tax relief, but the tax relief is a fraction of what it would be for somebody in a higher income bracket. Madam Speaker, I regret that I don’t have with me – I’ll find it for later debate on this bill – the actual text of the analysis I did for constituents. I went through and said, given different incomes, what your tax saving would be.

I think people have responded in a very strong way by saying that with th is single-tax system, the flat-tax system, they see there’s something about it that is radically different from the system of taxation we’ve understood in this country. They understand that sometimes in the rush to adopt things that seem to be simpler and in the rush to adopt things that just seem to be less complicated, you sometimes work substantial injustices to signifi- cant groups of citizens, and that clearly will be the case, in my opinion, with Bill 18 if it proceeds unchanged. The bill also tells us a couple of other things.

Maybe I’ll make this observation now because we are dealing with the principle of the bill and so many of my concerns are going to relate to some of the minutiae and some of the specific sections and subsections in the act. What I’d like to do is recognize that in Bill 18 what we’re doing in effect is saying to an awful lot of Albertans, a lot of middle-income Albertans, that you haven’t been paying a big enough share, that those wealthy entrepreneurs, the people who are making incomes in excess of $150,000, need a break, that they’ve just been carrying too much of the burden.

Now, I don’t know about you, Madam Speaker, but I think this government spends too much time worrying about people who have incomes close to and exceeding $200,000 a year and far too little time worrying about those Albertans that are managing on incomes somewhere between $30,000 and $70,000 a year in terms of family income. [interjections] Madam Speaker, I see there are some government members that are offering some advice from their seats. I’m always interested in learning more about the machinations of the government caucus in terms of how they review these bills .

All I’m left with is the bill that’s produced from this process at the end, and when I have questions about it, some of those questions are about the process. You start wondering who had input into this. I mean, who are you listening to? It’s a lot like Bill 11. You see a bill that is not going to advantage the vast number of Albertans, and you say: why is this bill coming forward? You say to the government: who are you listening to; who’s driving the agenda?

There’s a suspicion that the same people that would drive the agenda on Bill 11 are now apparently working hard behind the scenes to promote Bill 18, this new flat-tax regime. So I’ve got those kinds of initial concerns in terms of reviewing this. What’s going to happen is that in the 2000 tax year, under the federal government tax plan – and this is the other thing. I might just digress and say that it appears the former Provincial Treasurer was in such a rush to launch his leadership campaign for the alternative, he moved heaven and earth to be able to move up the date for the provincial budget.

Normally the provincial budget comes about two, three weeks after the throne speech, but you’ll remember that just a week after the throne speech we had the budget speech. Many of us asked: why is that? What seems apparent, I think, to most of us is that it was a chance for the Provincial Treasurer at that time to show that he’d stolen the march on Ottawa. Of course, what happened was that as a result of the changes announced in the federal budget, we then discovered that Albertans are having to pay more.

What we find out is that the government in its haste and its absolute fixation with trying to score another cheap headline compromised the interests of Albertans, just as they have done on Bill 11. In the 2000 tax year, under the federal government tax plan the middle-income tax bracket will be reduced from 26 to 40 percent effective July 1, 2000. There w ill be an increase in the threshold of middle- and high-income tax brackets to $30,000 and $60,900 respectively, and the basic and spousal exemptions will

1254 Alberta Hansard May 2, 2000 increase to $7,231 and $6,140 respectively. Now, the impact of those tax measures in Alberta is going to be some $66 million, and that is just in the 2000 tax year. 8:10 What we find is that Alberta taxpayers below $70,000 in taxable income will be paying more in provincial personal income taxes under an 11 percent single rate in the 2000 tax year and subsequent tax years than they would under the existing tax system. Madam Speaker, this surely represents some kind of new height in audacity.

Our provincial government comes forward and tries to present Albertans with a present – and that’s the way they couch it and package it – which means that we would pay more income tax and we will pay more income tax than we would have before Bill 18 came along. Now, one can only say – and we’re getting so me terrific body language from the Member for St. Albert, who appears to be signaling her disagreement. Well, I hope she’s going to stand up and explain to me how the confluence of the federal budget passed in the last year and Bill 18 will not represent an increase in tax.

If that can be shown, let’s demonstrate it. Let her stand up after I sit down. She can take us through and explain to us how this is not going to cost Albertans more. I put my calculations on the record, and I’m going to specifically challenge that Member for St. Albert to tell me where she parts company with my analysis and how she comes to any different conclusion. I’m open to learn that, and I’m looking forward to seeing it.

On March 14, 2000, we heard the Provincial Treasurer say: well, maybe we’ll then reduce the 11 percent single rate and raise exemption levels in order to flow through federal government tax measures. We might ask: why would we expect that this govern- ment will be any more competent in terms of making that adjustment than they were in bringing in the bill in the first place? You know, this is pretty serious stuff when you start changing your tax system.

I think it’s completely unacceptable that the Provincial Treasurer would not have foreseen how much smarter it would have been to wait and see what was in the federal budget before charging ahead with his flat-tax proposal. [interjections] The Member for Calgary-Egmont, who seems to profess some expertise in terms of tax law, and the Member for Calgary-Fish Creek are offering lots of advice, the two of them. They represent that corner in south Calgary, and there are lots of high-income earners in those areas. In Calgary-Fish Creek you can drive around and see those big, fancy homes.

In Calgary-Egmont there are some lovely single-family residential homes. It may be that the constitu- ents in Calgary-Egmont and Calgary-Fish Creek don’t care about those people whose incomes are less than $70,000, whose taxes are going to go up. It may be that that’s the position they take, Madam Speaker. THE ACTING SPEAKER: Calgary-Egmont on a point of order. Point of Order Imputing Motives MR. HERARD: Madam Speaker,

section 23. The hon. member is imputing motives to my constituents, and I think he should apolo- gize. THE ACTING SPEAKER: On the point of order, Calgary-Buffalo. MR. DICKSON: My response to the point of order is that it is contrary to the Standing Orders to impute motives to other members of the Assembly. I was doing no such thing, and in fact he sug- gested that I was imputing motives to his constituents. Well, I’m not imputing motives other than the sense of desperation and fear they may experience in Calgary-Egmont and Calgary-Fish Creek when they understand what’s coming forward in Bill 18.

If you want to make a ruling, those are my observations on the point of order, Madam Speaker. THE ACTING SPEAKER: Excuse me. Order please. Hon. Member for Calgary-Buffalo, I would ask that we do look at Bill 18 and try to discuss the overall principles of that bill, and let’s not try tonight to be confrontational. I think you can make a point without being confrontational. MR. DICKSON: Madam Speaker, can I propose a bargain?

If the Member for Calgary-Egmont and the Member for Calgary-Fish Creek will not offer commentary during the course of my presenta- tion, I will be happy to follow the absolute guidance I get from the chair and stick on the bill. Without the provocation I’m happy to focus on those things. THE ACTING SPEAKER: It’s fine to stand in this House and point fingers and name names, hon. member, but I think the chair sitting up here could say that we will not have anyone do that. There are people on both sides of the House with interjections and interfer- ences.

I’m not going to name names here, but it sort of goes back and forth. This isn’t totally one sided. The chair wants to be fair and equitable in all of this. I would ask that if our remarks pertain to the bill we have in front of us, as you talked about earlier, the principles involved in Bill 18, without naming names, without naming constituencies, and talk about the overall principles of the bill, we’ll all be better off. Go ahead. MR. DICKSON: Madam Speaker, thank you very much for your advice and direction.

I take it that what you’re not suggesting is that we can’t talk about the people who are going to be directly affected. I want to be absolutely clear that what we’re talking about is the people who are going to be affected by this bill. THE ACTING SPEAKER: Hon. member, you’re not arguing with the chair, are you? MR. DICKSON: Of course, I’m not arguing, Madam Speaker. THE ACTING SPEAKER: Well, then let’s get on with the princi- ples of the bill. MR. DICKSON: I want it to be absolutely clear in terms of what I’m attempting to do. Debate Continued MR.

DICKSON: So let’s spend a moment identifying the major flaws with Bill 18. The first one is the fact that it compromises equity and compromises fairness. What happens is that the whole system is skewed to the top 4 percent of tax filers. The top 4 percent. I thought that at some point our responsibility was to make legislation that’s going to advantage most Albertans, not the top 4 percent of tax filers. But doesn’t that tell us something about the priority of this government?

I mean, whether it’s private health care for those that have deep pockets and can afford it or special tax relief for those people who are in the top 4 percent of tax filers – that’s fine. That’s a priority for this government. But for the vast majority

May 2, 2000 Alberta Hansard 1255 in this province, the three milli on people, it’s an entirely different story. It’s called not so benign neglect. [interjections] Now, Madam Speaker, if you direct the minister to hold his remarks, I’d be happy to finish mine. You’ve enjoined me not to respond, so if the member oppos ite will keep his comments to himself, I’ll try real hard to finish the observations I wanted to make. THE ACTING SPEAKER: The hon. Member for Calgary-Montrose on a point of order. MR. DICKSON: Certainly, Madam Speaker. Point of Order Reflections on Nonmembers MR.

PHAM: Madam Speaker, I have been listening to the speech from my colleague from Calgary-Buffalo, and I would like to raise a point of order under Beauchesne 493(4): “The Speaker has cautioned Members to exercise great care in making statements about persons who are outside the House and unable to reply.” Your statement earlier referring to the constituents of Calgary- Egmont who do not care about other people was very, very rude. I think you should make an apology to those people who are not in the House and cannot defend themselves.

THE ACTING SPEAKER: I really don’t think there is a point of order, because we did just deal with that a few minutes ago. May I suggest again that we look at the principles of the bill instead of identifying areas. MR. DICKSON: Okay. Would it be okay if I refer to Calgarians, Madam Speaker? I represent some of those people too. 8:20 Debate Continued MR. DICKSON: In terms of following through on the bill, we’ve identified that the priority of this government is the top 4 percent of tax filers.

The people who receive much smaller cuts are those Albertans who are the 39 percent of middle-income tax filers who earn between $30,000 and $70,000. They pay over 45 percent of the personal income taxes in this province. They receive much smaller cuts as a percentage of the current personal income tax that’s paid. Now, the second problem we have with Bill 18 is a major one. This is sort of the end of the progressive tax system as we’ve known it in this province, because what it provides is that every single taxpayer in this province regardless of taxable income will pay the same 11 percent rate.

Now, because 132,000 people at the bottom end are taken off the tax rolls and because there has been an increase in basic and spousal exemptions to some $16,000 and change, the government would have us believe that this is a way of maintaining fairness. But that’s deceitful, Madam Speaker. That’s not the reality at all. That’s not the reality. You know it and I know it, and I think every taxpayer in this province is soon going to discover that with the bill as we understand it. The other concern is that the people who are really injured by this are what we’d call middle-class, middle-income Albertans.

Those taxpayers who earn less than $70,000 in taxable income would receive a larger provincial tax cut starting in 2001 if the federal tax measures flowed through than they will under the 11 percent single tax rate. That’s a simple fact. It’s a consequence of the skewing. The distribution of tax cuts under the 11 percent single rate is skewed towards taxpayers earning over $100,000. Now, the other major concern is the marginal rate increases for low-income earners and middle-income earners.

If we assume the elimination of the .5 percent flat tax rate on January 1, 2001, taxpayers in the 17 percent bracket – that’s up to $30,004 – and the 24 percent middle-income bracket – that’s $30,000 to $60,000, plus or minus – would have a higher marginal rate under the 11 percent single rate than they would under a tax-on-tax system in the 2001 tax year. My MLA is here. We have an accountant here in the front row on this side from Calgary-North West. Now, here’s a guy who’s spent his life as a respected member of the chartered accountant profes- sion.

I’m looking forward not only as a constituent but as a fellow Calgarian to hearing him develop his analysis. I’d like to attest his proposition. MR. MELCHIN: I’ve already spoken. MR. DICKSON: Well, I haven’t been persuaded by anything he’s said so far, but I wanted to specifically ask him – I’d like to test with him these assumptions that I’m making. I’d like to know with as much specificity as the Member for Calgary-North West can provide how his analysis would differ from mine, because I want to share that with my constituents.

I think the point to make is that if you’d had a tax reduction package of, say, $877 million, if you were to do, independent of Bill 11, if we just pretended for a minute . . . AN HON. MEMBER: Bill 18. MR. DICKSON: Bill 18. I’m sorry. They become interchangeable. I told you they’re closely linked. If you imagine just hypothetically that you had a tax-reduction package under the current progressive system of $877 million . . . I think I’m out of time, but I’ll pick this up at committee stage. Thank you very much. THE ACTING SPEAKER: The hon. Member for Edmonton- Ellerslie. MS CARLSON: Thank you, Madam Speaker.

I’m very happy to be able to speak in principle to Bill 18, the Alberta Personal Income Tax Act, the legislation before us th is evening. In principle this is a very lousy bill. I have to say that to begin with. There are many reasons for that. AN HON. MEMBER: Don’t hold back. Tell us how you really feel. MS CARLSON: Well, I could say a lot more than that but it would be unparliamentary, so I will stick with “lousy” for the time being. Let me tell you what a number of people said about this bill last evening in front of the Legislature.

I had the good fortune of speaking to about 2,000 of the people who were gathered outside the Legislature last evening to protest other forms of legislation before this Assembly. It was early in the evening. Later on in the evening about 4,000 people accumulated, but early in the evening I asked those 2,000 assembled people what they thought of the flat tax. First of all I said: put your hand up if you support the flat tax, because that’s what we’re debating in the Legislature this evening.

Madam Speaker, you’d be surprised to hear this but not a single hand went up, and of course the boos resounded throughout the crowd. Not a single hand went up. So then I said: who opposes this particular flat tax? Everybody’s hand went up, the sirens went off, the horns honked. Resoundingly, to a person, there wasn’t a single person out there who supported a flat tax. So, once again, the

1256 Alberta Hansard May 2, 2000 government hasn’t done their homework on legislation that they brought to the floor of this Assembly. I think the government believed they could just slide one past the people of Alberta. Everybody’s concentration is on Bill 11, because it’s a hugely important bill that’s going to change the nature of our province forever. This government thought they could just slide in Bill 18 when nobody was looking and pass legislation that also would be harmful to the people of this province.

Albertans are a lot smarter than that, and we know that because we’ve been talking to them, listening to them, seeing them gathered outside, reading the e-mails, meeting them throughout the province, and so on. People aren’t fooled by what’s going on here. They see that Bill 18 and Bill 11 are companion pieces of legislation that will establish precedents in this province that are harmful to most Albertans, in fact all but 4 percent of high-income earners that my colleague from Calgary-Buffalo referred to.

Definitely a flat tax differentiates between those who have in this province, those who are maintaining a middle-class life style, and those who have not. High-income earners pay proportionately less money with the flat tax. There is no way the facts can be argued on that point. We’ve had the odd chirping from across the way this evening on that, but I don’t see anybody standing on their feet to defend the government’s position and to explain how it could be anything else than this particular bill disproportionately benefiting a few people in this society and disproportionately harming the balance of them.

That’s what this bill does. Madam Speaker, let’s face it. The high-income earners, that 4 percent of people in this province, do not need any more breaks. They have the greatest flexibility in terms of tax planning. They just don’t need another break there. They have all kinds of options in terms of how to defer income and do a variety of tax planning. Because they have the cash flow, they have the maximum tools available to them, not like middle-class taxpayers like me and most of my colleagues and most of the people in this province where it’s a tough go these days. We don’t need to pay any more tax.

By the time we get finished with user fees, with school fees, with tuition fees, with all those other costs this government has downloaded on us since 1993, we can’t afford to pay any more tax burden. It isn’t reasonable for us to expect other people to not pay their fair share. It isn’t that Albertans aren’t prepared to pay their fair share, because we are. We know what it’s like. When we have extra money, Madam Speaker, we contribute that to a variety of charitable foundations, churches, nonprofits, all kinds of organizations. How do we pay that money?

We do it according to the kind of income we’re making, the excess disposable income we have. When we have more money, we pay more money. So those who earn more money should pay more money. They should pay their fair share of taxes in this province. We would do that if we were in those high- income brackets. We do that in a volunteer way now in charitable donations and other kinds of giving. We would do that if we were high-income earners. Why should we expect specific breaks for these people in this particular legislation? It is simply unfair.

It is unfair in a global context in terms of what’s happening in this province too, Madam Speaker, and it impacts Albertans in the long term in a very, very negative fashion. Because the high-income earners won’t be paying their fair share of the tax, in general we will have less tax revenue coming into the Alberta coffers. What does that look like? Less tax revenue coming from tax generated income. We are in a declining position for oil and gas revenues in this province.

In spite of what the Minister of Resource Development will tell us every chance he gets, we do not have unlimited oil and gas reserves in this province, and best estimates are 10 years to 25 years in both oil and gas in terms of reserve possibilities. So we’re going to have less income coming in through those areas. 8:30 This government, in spite of a 30-year attempt to do so, has not been able to sufficiently stimulate tertiary development in this province so that we have that kind of corporate taxable income coming in. They’re still floundering. We’re a resource-based economy still.

They haven’t been able to get it right no matter what they’ve done, so we don’t have that kind of a tax base coming in. Yes, we have more gambling revenue, Madam Speaker, but what does that mean? For every dollar that we collect in gambling revenue, we pay $3 out in social costs, so that doesn’t mean that there’s a net benefit to the tax base of this province.

So we’ve got less personal tax coming in, less corporate tax coming in, less than what we could have had had we promoted development properly in this province, fewer tourism taxes and dollars coming into our economy b ecause of the way this govern- ment has promoted oil and forestry development in the province. We are losing some of our best tourism resources, and we have the gambling revenue that’s really sucking dollars out of the system, at a rate of 3 to 1. So what does that look like long term?

It means that this govern- ment is going to be in a position where they will be less able to fund basic services like health care and education. That’s where we can see that Bill 18 is the compani on bill to Bill 11, Madam Speaker, because this government is deliberately forcing a situation in this province where there is no option but to go to private health care and private education. There will not be the tax dollars to adequately fund a basic system.

They are setting the stage now for private operators to be able to come in to skim off the cream of the profits in this province, not to the benefit of Albertans, not in terms of service providing, and not in terms of tax revenue, because in both of those areas, health care and education, the best possible service is provided when it’s provided in a universal kind of system. We’ve seen that globally.

This government, in spite of all of the calls for documentation to be tabled in this Legislature to this day, to the date of closure, has been unable to put any proof on the table that in fact what they’re proposing to do will be cost-effective or will provide better service. This won’t happen. So why are they doing it? Speaker’s Ruling Relevance THE ACTING SPEAKER: Edmonton-Ellerslie, the chair will remind you that we are in second reading of Bill 18, and I would ask that you debate the principles of Bill 18.

MS CARLSON: Thank you, Madam Speaker, for that ruling, and definitely in principle these bills are linked because of the long-term effects they have on Albertans. But I will keep your ruling in mind and will explain it in more detail if it’s escaping some of their attention spans. Debate Continued MS CARLSON: The fact is that what’s happening in this province is not random. It is a deliberate attempt to establish a private system in many venues.

If you have no tax base in the province, the only option for providing basic service is privatization, and this bill is a Treasury bill which impacts every single department in this govern- ment. Therefore, we can talk about every single department in this government when we’re debating it.

May 2, 2000 Alberta Hansard 1257 It also affects every single person in this province. It is a punitive kind of bill. It will not receive support from us. It does not receive support from Albertans, and once again this government has called the situation wrong in terms of meeting the needs of Albertans. They are playing to a select few, that 4 percent who under this particular scheme will gain a tax benefit.

We say that is wrong, and we will stand for the people of the province who do not want this kind of legislation brought in, in spite of this government trying to divert our attention away by bringing in another major, horribly planned bill in terms of health care. In spite of that, we will fight this bill because it is wrong and it should not be passed. It isn’t even well thought out in terms of the consequences of the federal government’s actions. The Provincial Treasurer was very keen to bring this bill in before we saw the federal budget. Why, Madam Speaker?

Because for that very short period of time between the introduction of his bill and the introduction of the federal legislation, which he knew was coming, he could truthfully say to taxpayers that middle-income earners were going to receive a tax break. Because of the way the federal legislation came in, which is actually more beneficial than what this bill could have ever been, now that isn’t the case. Now middle taxpayers are going to be paying a disproportionately high percentage of taxes.

So he was right for about three days, Madam Speaker, but he knew very well that he was going to be wrong for the rest of the life of this bill. Yet he still brought it in. Why, Madam Speaker? Because he wants to set up a climate for privatization within this province, and that is fundamentally wrong, and because it’s f undamentally wrong in principle, I at this time would like to introduce an amendment to this particular bill, and I will have it circulated at this point. THE ACTING SPEAKER: Just wait a few minutes, hon. member, until the other members have them. Okay. Edmonton-Ellerslie, go ahead.

MS CARLSON: Thank you very much, Madam Speaker. Here’s what the amendment says: that the motion for second reading be amended by striking out all of the words after “That” and substitut- ing the following: Bill 18, the Alberta Personal Income Tax Act, be not now read a second time because the Assembly believes that as a result of the tax reduction measures announced in the 2000 federal budget, the bill would not ensure that all Alberta taxpayers receive a fair tax reduction. Now, what could be a better amendment than that, Madam Speaker?

In fact, all of my colleagues here have said that they support the amendment, and what that means is they’ll all be able to speak to it too. So I’m looking forward to what they have to say to it. I know that they have been out in their constituencies talking to people about the flat tax. See; they’re all agreeing with that. I know in my constituency I have had a number of people come in and meet on this particular issue. It is a hot topic in the phone calls and at the doors, and people do not trust this government, that they will be seeing any kind of lowering of tax.

I’m not surprised that they don’t trust them, Madam Speaker. I don’t trust them either, b ecause I haven’t seen legislation come through that actually supports what they say they’re going to be doing. In fact, they fall short on all of the major pieces of legislation that I have seen in this Assembly since I have been here since 1993. So they’re right to question it. In that regard, it’s very important that the amendment be brought in at this stage.

This government needs to do what it always does when it doesn’t know what to do, and that’s go out and talk to the people, Madam Speaker, be it roundtables or town hall meetings or whatever this government feels would be an effective process.

They need to get out there and talk to Albertans and understand how strong the opposition is to a flat tax in this province, not by those few 4 percent who are going to achieve a great benefit through this particular legislation but by the middle-class taxpayers who bear the burden of taxation in this province and who have just had this burden increased by this government with this legislation. Clearly, once again the government did not think through this process, and they need to do that.

What we need to do is have this legislation tabled over the summer, let them get out there, talk to the people, find out what’s wrong with it, and I’m sure at that point they’re going to do the right thing and withdraw the bill, Madam Speaker, because that’s what’s required here. We saw a similar circumstance like that happen last year with Bill 15, the Natural Heritage Act, where the government brought in a very badly flawed piece of legislation.

We brought in an amend- ment like this and ultimately had the government stop discussion on the bill at that stage and put forward a number of meetings and focus groups over the summer, which the Member for Banff-Cochrane chaired and did actually a very good job at, and came back with revised legislation. 8:40 Now, unfortunately, it’s hit a stumbling block in their own caucus because the Minister of Resource Development won’t s upport the kinds of changes that need to be made to help protect the environ- ment.

However, that process worked quite well up to that point, Madam Speaker, and I’m suggesting a parallel kind of process to happen with this bill, that we not now read this bill a second time, as the amendment says, and that we see a process come forward where this government can get out from under the dome and actually take the time to listen, not just sit in front of the people of Alberta but listen to what they’re saying, to assimilate that and to incorporate it into this particular legislation and come back in the fall when we’re in our fall session and announce to us that they made a mistake.

There’s nothing wrong with doing that. We know that the Premier used to be quite fond of saying that in this Legislature. He’d get up quite often and say: I’ve made a mistake, and we’re going to change direction. On MLA pensions I remember very clearly that he stood up in the Legislature just before he went to the ’93 election looking for some kind of a hook for that election, and he said: hey, we made a mistake; there shouldn’t be any MLA pensions. He rescinded them. That actually got him elected in 1993, Madam Speaker, so he should remember how important the voice of the people of Alberta is.

They want to be listened to. We know that. We’re out there at the doors, and we’re in the community halls, and we’re talking to the people in the coffee shops. We know that this is a very flawed piece of legislation, that it unfairly burdens middle-class taxpayers and that people in this province want it gone. The vast majority of the people want it gone. There are a couple of small portions of the b ill that could be incorporated into new kinds of legislation, like increasing the personal exemptions.

That is a good pi ece of the bill, and I would like to recognize that as a good piece, but it could easily be incorpo- rated into other kinds of legislation. In fact, we would be happy to see that come through miscellane ous statutes with absolutely no debate on it, Madam Speaker, because that would be a good piece of legislation to see in this Assembly. But when you tie it into something that’s absolu tely abusive to the people of Alberta, like this particular bill, we are never going to support it. So for that reason I think it’s very important that members on the opposite side

1258 Alberta Hansard May 2, 2000 here review this amendment, that we see them speak to it. The Minister of Resource Development was very eager to get up a few minutes ago and make comments on my colleague from Calgary- Buffalo’s comments. MR. DICKSON: He was shouting from his chair. MS CARLSON: He was shouting from his chair. He wasn’t anxious to get up, but maybe he’d like to get up now. He did speak before on second reading, but I’m sure that he would like to explain to the people of Alberta . . . THE ACTING SPEAKER: A point of order. The hon. Member for Fort McMurray. Point of Order Questioning a Member MR.

BOUTILIER: I would like to know if the hon. member would entertain a question on the point that she’s raising. MS CARLSON: No. I only have a couple of minutes of speaking time left. Debate Continued MS CARLSON: This is what I would like that particular member to do: get up and speak to this amendment. He can raise all his questions at that point. I will give the notes to one of my colleagues and answer all of his questions in detail, which that person can then read into the record.

I challenge the Member for Fort McMurray to get up here and defend his government’s legislation, which I know he doesn’t like and can’t defend. So he has the opportunity to ask his questions of me at that point in time, and I will undertake this evening, before this debate is over, to get back to him with full and detailed answers on this particular amendment. Let’s see if he’ll do that. He’s quite happy to stand and ask a question. Let’s see if he’s prepared to enter into debate, because I don’t think he is. I’m sure that the people of Alberta would like to know what it is that he has to say.

THE ACTING SPEAKER: The hon. Member for Fort McMurray has risen on a point of order. Point of Order Questioning a Member MR. BOUTILIER: I wonder if she will entertain a question? MS CARLSON: No. I said no for the second time. THE ACTING SPEAKER: Continue on, Edmonton-Ellerslie. Debate Continued MS CARLSON: Clearly he wasn’t listening because I went on to explain how I would not use up my valuable speaking time, which is quickly running to a close, to answer his question but that I would undertake to answer those questions this evening in full detail.

In fact, we could circulate those answers to anybody else who would also be interested in looking at them. Clearly, the government didn’t think through the process in this bill, and they need to be asking a lot of questions, Madam Speaker, and we are quite happy to provide the answers. In spite of the fact that they have massive research departments and a lot of resources at their fingertips to do the in-depth kind of study that’s required for this piece of legislation, they didn’t do it.

On our very limited budget, which consists primarily of the ability to listen to Albertans, we are quite happy to answer their questions on any particular point they raise, including this particular amendment and including this particular regressive bill, at any point in time. MR. DICKSON: We got elected to ask questions. They got elected to answer. MS CARLSON: That’s true. My colleague from Calgary-Buffalo says that, as members of the Official Opposition of Alberta, we got elected to ask the questions, and they got elected to provide the answers. [interjections] THE ACTING SPEAKER: Excuse me.

Please, could we have some order? Edmonton-Ellerslie has got the floor and only Edmonton- Ellerslie. MS CARLSON: However, Madam Speaker, their point was excellent. Next time we will have the opportunity to answer the questions, and we’ll be quite prepared to do that at any point in time, and unlike this government, we w ill answer the questions. That’ll be a change, and it’ll be refreshing for the people of the province.

We will continue to listen to Albertans, unlike this particular government, who for some reason has become isolated and chooses to speak to the top 4 percent and hear what they have to say and bring in legislation that benefits them but forgets the rest of the people in this province. That is very unfortunate. However, we understand that they are going to pay the price at some short time down the road because people are very upset, and they are upset at a number of pieces of legislation. This particular bill, this flat tax bill, they are nearly as upset at as they are at Bill 11, and I wouldn’t take that lightly.

There were anywhere between 2,000 and 4,000 people outside the Assembly last night who clearly . . . [interjection] Well, don’t laugh at that. Don’t laugh at that. There were 2,000 to 4,000 people out there, and those people are motivated, Madam Speaker, not just to vote but also to work for people. And they will tell the Premier at the end of the day what the answers will be. THE ACTING SPEAKER: The hon. Acting Provincial Treasurer. DR. WEST: Well, Madam Speaker, it’s time to rise in this Assem- bly, address this bill and this amendment at second reading, and set the record straight on a few things.

I think we’ve heard a lot of rhetoric, not a lot of it with detail about what Albertans are expecting from a tax system. I think I’d like to start with a little history of Bill 18, on what we did a few years ago in addressing what Albertans were asking us to do. This bill, of course, brings us into the 21st century, with Alberta being the destination of choice for many people who wish to raise their families, earn a living, and invest their hard-earned dollars in this province.

This is a forward-thinking plan that’s in place today, based on the visions of Alberta: a hardworking family that wants and deserves to keep more of what they earn, who strive for fairness, and who desire simplicity in their tax system. When we put together in February of 1998 a Tax Review Committee that traveled across this province, they came back with the views of Albertans, some 80,000 who mailed in their views on this issue as well as many hundreds who came to the meetings and voiced their opinions.

During the debate that took place in 1998, the committee identified four problems with the tax system in Alberta. Bracket creep, also known as the invisible tax, has been an insidious method of tax collection used by all Canadians’ governments. Through the simple process of inflation, the salaries of working

May 2, 2000 Alberta Hansard 1259 people get pushed into higher tax brackets, and they pay higher taxes. This erodes buying power and hits low-income citizens hardest. As politicians we began to look around to see where the bracket creeps were, and as our previous Treasurer said, most of them were in government.

I have known many people who have come to me over the years and said, “You know, I work overtime,” or “I go and get some extra money paid to me.” And they say, “I turn around and find that I’ve moved into another bracket, and it’s cutting my income down by 30 percent.” My own children work in this province, and if they work overtime, whether it’s doing CAT scans or MRIs or whether it’s nursing, if they come home and they look at their tax notice today, it hardly makes it fair for them to go back and work many hours of overtime on behalf of the people of Alberta. 8:50 The second thing.

The Tax Review Committee also reported that Albertans were frustrated with the flat tax and surtax, the so-called temporary deficit elimination taxes of 1987. We, who had brought in taxes – and all governments have done this over the years – to eliminate certain deficits at certain periods of time unfortunately never removed them. When these taxes were introduced a long time ago to reduce the deficit, the deficit continued to rise. When Premier Ralph Klein took over the reins of the government, the deficit finally started to go down. When we finally eliminated the deficit in ’94- 95, the taxes, however, stayed.

So here in Alberta we have quite rightly been singing the trumpet song of deficit deliverance, but when we got to the verse about deficit tax deliverance, we forgot the words. Well, we are going to address it now, here in this Assembly during this session, and I ask the hon. members opposite to join with the Albertans who want these taxes gone. Madam Speaker, we also know that families believe we need to level the playing field for how we tax one-income and two-income families.

The choice of whether one or two partners work outside the home should be a personal family choice, but the tax scales are tipped in favour of two-income families, making the choice more difficult for those who choose to live on one income. It is evident in this province that one person making $60,000 a year with a stay-at- home parent pays more tax than people who have a two-parent, two- income family where one member earns $40,000 and the other earns $20,000. They want a level playing field put in place for these families.

Finally, the Tax Review Committee said that we should rid ourselves of the cumbersome and burdensome effect of the multibracket system. They suggested that we break away from the federal tax structure as a means of setting our provincial rate and move to a single provincial tax rate on all income and, at the same time, allow for generous personal and spousal credits. Breaking our attachment to the federal rates would give us more flexibility and would make our provincial rate more transparent to our citizens, less prone to the whims of the federal Finance minister.

Now I’ll divert from my comments here to one issue that’s been brought up over and over again in this debate. Since we were dehooking from the federal tax system and had announced this and had brought forth the announcement of a flat tax, the federal government – and I’m not going to say they did it deliberately – went into the middle-income bracket and changed their rate there, on one of their brackets.

We have said in this province – and I stand here tonight, along with the Premier’s statements – that we will change this system that we’ve come to by moving the rates and changing the spousal allowances to ensure that that middle-income bracket is justly served by this flat tax program. [interjection] One of the hon. members says that you have to bring it in in this bill, but he should know – and you’re an understudy of tax laws, are you? You should know that you don’t have to change any one of the numbers in this bill for a government to effect its tax program. You know that.

You know that rates of taxation are changed constantly without legislation at the time. It is brought into legislation in the future. THE ACTING SPEAKER: Acting Provincial Treasurer, through the chair, please. AN HON. MEMBER: They’re baiting him. DR. WEST: The individual is de-baiting me; that’s correct. Now, let me repeat it one more time.

We have said that if the federal government changes their tax brackets or changes their way of taxation so that it is injurious to any one segment of Albertans, we will change the flat tax to address that so there’s no injurious action to the middle income, to the low income, or to the high income. Now I’m going to go on to talk about what Bill 18 addresses and how it does it. But here’s a speech given by one of our leading CEOs at the Summit 2000 meeting in Toronto, Canada, on April 5. He’s talking about the liabilities of working in Canada for his company and where they invest their money. It is Mr.

Gwyn Morgan, the chief executive officer of Alberta Energy Company. He said: On the liability side of the ledger, we have one key problem: much higher personal tax rates make it very difficult for us to bring in those experienced international people we need. And, to make matters worse, we have found that when our Canadian workers are assigned to international operations, it’s very difficult to get them to come home.

They just have a lot of trouble undergoing the double cold shock of moving to after-tax financial realities and to Canadian dollars from U.S. dollar-based wages, and they often find that the quality of life elsewhere is better than they thought it would be. He goes on to say: The total tax load of Canadians is simply draining the ability of our economy to provide the investme nt capital necessary to fuel a strong, free market economy.

I note that the hon. members of the loyal opposition are chattering away here, but when I was a boy being raised, I understood that Liberals did support a free market system, the dignity and self- respect of having jobs, retaining the largest amount of your earned income so that you could raise your families, work hard, deliver self- respect back, build your homes, and accumulate certain evidence of wealth. But when we come and make statements like this, they chatter away, denying the reality that we must lower the taxes in Canada and in Alberta in order to be competitive.

Bill 18 is about making Albertans live better and making the Alberta economy stronger. B ill 18 addresses five general areas of concern identified by Albertans through that tax review: Alberta’s competitiveness with similar jurisd ictions, the tax plight of low- income earning Albertans, the phenomenon of bracket creep, taxation inequities between one- and two-parent families, and temporary deficit elimination taxes that linger long after the deficit. People are concerned about Alberta’s competitiveness.

We compare favourably with other provinces, but Canada does not stack up well against other G-7 countries, and we’re not competitive with the U.S. Bright young Canadians are fleeing south, where the before-tax value of each dollar is 50 percent higher and the after-tax value of each dollar is another 20 percent higher. Albertans with low incomes deserve a tax break. Do you not agree with that? The current basic personal exemption is just too low. Bracket creep means that although people’s incomes are not

1260 Alberta Hansard May 2, 2000 increasing in a real sense, they’re paying more tax. When Canadian salaries increase to keep pace with inflation, they are pushed into higher tax brackets. This means that most Canadians get less than the government when they get a raise. This insidious method of tax collection has given Ottawa a $10 billion bonus. In fact, coffers in every province have been topped up by bracket creeps. Alberta has led the fight against . . . MS OLSEN: Madam Speaker, a point of order. THE ACTING SPEAKER: Acting Provincial Treasurer, we have a point of order. Edmonton-Norwood. Point of Order Questioning a Member MS OLSEN: It’s under Beauchesne,

section 333. I just wondered if the minister would entertain a question. DR. WEST: Absolutely. We’re not afraid of questions. Debate Continued MS OLSEN: I just wanted to know, Madam Speaker, if the minister could tell us if it’s necessary to go to a single-tax system to get rid of bracket creep. Is it necessary to go to a flat tax system to get rid of bracket creep? DR. WEST: You can change taxes any way you want, but getting rid of bracket creep is the right thing to do.

It’s not fair for hardworking young Canadians to have to move into different brackets and pay more tax just because they work harder than they did before. I mean, that is unfair. The answer to your question is that it’s the right thing to do. [interjections] Madam Speaker, they have the right to ask a question, but if they don’t like the answer, they can sit there and fuss. THE ACTING SPEAKER: Very quickly, Edmonton-Norwood. MS OLSEN: Under Beauchesne,

section 333, I have another question for the minister then, if he would entertain another question. DR. WEST: No. This has gone far enough. 9:00 THE ACTING SPEAKER: The answer is no. The Provincial Treasurer will carry on with debate, and I would ask for decorum in the Assembly, please. Yes, Calgary-Buffalo. Point of Order Reading a Speech MR. DICKSON: Madam Speaker, I would cite Beauchesne 495 to 500 and the Speaker’s admonition of March 4, 1998, at page 683 that if you’re going to read a speech in the course of a debate, you have to table the speech.

I don’t know whether the speech has been tabled, but would the minister please ensure that the speech is tabled so we can all read it and save the time of the Assembly. Thank you very much. THE ACTING SPEAKER: Calgary-Buffalo, I’m sure that the hon. Acting Treasurer will be glad to table the portion that he talked about, the CEO I believe it was, through Alberta Energy in his speech in Toronto. I’m sure he’ll be glad to table that. I think that if we are really going to make any progress tonight, let’s quit this and get on with the debate at hand. Now, the hon. Provincial Treasurer has the floor.

The chair is recognizing him. I would ask for decorum in this House, and let’s get on with the job at hand. Debate Continued DR. WEST: Thank you, Madam Speaker. Now I’m going to move on to the new system that we’re putting forth here tonight. I want to emphasize one more time. They’ve spent a great amount of time saying that those people at less than $70,000 are disenfranchised by this.

I’ll say one more time that the Premier of this province and the government of this province have said that if the federal government changes any one of their brackets, we will alter the basic exemption as well as a percentage here to make them part of the tax reduction. Before I start on the new system, I’d just like to point out something to correct an image that ’s left. You can paint this any way you want, but there were some comments about who pays taxes in the province and who this helps or doesn’t help.

In Alberta, for example, the top 1 percent of income earners pay 21 percent of all the tax in the province of Alberta. Now, the top 5 percent – they were talking 4 percent over there – pay 40 percent of all the tax. The top 10 percent – now, all of you may know some people in the top 10 percent. A half million plus don’t pay any tax, but the other 90 percent pay 48 percent of all the taxes. Those top 10 percent pay 52 percent of all the taxes in this province. To say that they don’t fairly pay their share of tax is misleading this House and misleading the people of Alberta. Those statements are unbelievable.

The new plan announced in Budget ’99 unhooks Alberta from the federal rate structure, moving the province from our tax-on-tax system to a tax-on-income system, and when the plan is fully implemented, Albertans will pay less money to this Provincial Treasurer. Under the new system Alberta will unhook from the federal system by calculating provincial tax as a percentage of the taxable income rather than calculating provincial tax as a percentage of the federal tax. Albertans will see a simpler tax system and will continue to file only one tax return.

We will move to a single rate of tax when we unhook from the federal system. A low rate interferes less with the choices people make about how they earn, spend, save, and invest their inco me. The single rate makes the system easier for Albertans to understand and rids the provincial system of the three federal brackets that until now Alberta has been forced to parallel. Under the new system, a single nurse in Lloydminster who earns $40,765 paid Alberta income tax of $2,665 in 1996 and will pay $2,475 in the year 2002.

A family in Lethbridge with one s pouse earning $50,215 as a law enforcement officer and the other staying at home with three children paid Alberta income tax of $3,070 in 1996 and will pay $1,665 in 2002. A Red Deer family with two children, where one parent is a firefighter earning $47,345 and the other a teacher earning $43,205, paid Alberta income tax of $6,315 in 1996 and w ill pay $5,830 in 2002, and remember that that includes inflation and all the other costs. We will increase the basic exemptions and release an additional 132,000 low-income earners from Alberta’s tax rolls.

These people will pay no provincial income tax whatsoever. The Liberals’ plan that they brought forward would see them still paying some tax. These increases are fully indexed to inflation to pre-empt the possibility of bracket creep for these low-income people. This move will see the basic personal exemption increase by more than inflation for the first time since 1988. I’ll repeat it. These basic exemptions

May 2, 2000 Alberta Hansard 1261 will take off an additional 132,000 low-income earners, and as the population goes over 3 million, this number will be higher. The level playing field that people talk about. We will level the playing field by raising the spousal deductions to the same level as the personal deduction. Single parents will also get this enhanced deduction by applying it to their first child instead of a spouse. This will address the inequities between one- and two-parent families. We will wipe out both of the Alberta deficit elimination taxes, the surtax and the flat tax.

It just doesn’t make sense to tax people for a condition that no longer exists. On January 1, 2000, we eliminated the 8 percent surtax imposed in 1987 when we were battling the deficit. Albertans will have $144 million more in their pockets as a result. The flat tax goes January 1, 2001, when the whole system switches over. With the population increase that we’re seeing today and the changes that will be implemented, we will see a decrease of over $850 million in taxation, and when we address the federal issue, it could be well over a billion dollars that Albertans will be enhanced in their jeans.

I’m going to repeat it for the fourth time, Madam Speaker. Please bear with me. We will match any federal tax cuts for 2000 pending introduction of our new tax system. We are committed to passing the savings from the federal government on to Albertans. It’s important to keep in mind that we have just begun our fiscal year, and we will need time to analyze the figures, but those adjustments we will address through the affordability of the income to the province of Alberta. Let me assure you that we will match any federal tax cuts so that this commitment is held whole to Albertans.

As I say, there are some people outside. I’m not criticizing them. We all have opinions. But if I were to ask many of my constituents the details of the flat tax reduction and that, they wouldn’t know without me sitting down with them for coffee and going over the details of this tax plan. So to ask people standing outside the Legislature . . . [Dr. West’s speaking time expired] THE ACTING SPEAKER: The hon. Member for Edmonton- Glenora. MR. SAPERS: Thanks very much, Madam Speaker, and thank you to the Treasurer for that enlightening set of remarks.

I’m glad you didn’t adjourn debate, because I think it might make some sense to be able to reply to some of your comments on the record in real time, as it were. First of all, there’s nobody in this Official Opposition that doesn’t stand for fair and equitable taxation. There is nobody in this opposition that doesn’t want to move quickly to ensure that there is comprehensive, sustainable tax reform in this province that ensures the adequate funding of all of our core social programs and doesn’t pick the pockets of ordinary Albertan workers any more than they have to be.

It’s this government and the government that that minister is a part of that has chalked up an almost $10 billion surplus by lowballing revenues, continuing bracket creep, continuing high income tax surtaxes, continuing the flat tax, and then telling people that the cupboards are bare.

So let’s just express the facts as they are. 9:10 Now, the reason why I support this amendment from my colleague to not see Bill 18 read a second time is because fundamentally there is nothing that I have heard from the government since they introduced their concept of a flat tax that has convinced me or my constituents that this flat tax will treat them fairly. What we hear from the government is ideology that basically boils down to this: it is somehow morally offensive to tax people who earn more money, because if you do, you are creating a disincentive for those people to work harder.

What this government forgets and what they would like to pretend is true is that it is only hard work that equals eco- nomic success. Of course, we know that’s not true. Madam Speaker, nothing replaces hard work; don’t get me wrong. But it is not just hard work. Who you are and where you come from and who your parents are and the luck of the draw sometimes and a whole host of other social and economic conditions will also influence the amount of personal wealth that you may create or that you may be able to maintain.

Now, Madam Speaker, it is also misleading on the part of the Acting Treasurer to suggest that anybody in the Official Opposition – and I say the Official Opposition – is against free markets and the free-market system. Liberalism is all about free enterprise. Liberalism is all about the individual. But it recognizes that not every individual starts off from the same place. We believe very much in equality of opportunity, and that’s one of the beauties of the free-market system. Free markets allow for the creation of wealth, and the freer the markets are, the more that wealth can grow and grow and grow again.

So when you’re dealing with the free market, you also have to understand that the happy result of a free market is this creation of wealth. As I said, it’s not just because of hard work. It may be because of talent or resources, or it may be because of g ood luck. It may be because those to a greater degree than others were in the right place at the right time, and that means that there are going to be some who didn’t have that good fortune.

There are going to be some who, no matter how hard they work, may not be able to enjoy that prosperity as well as others, and it is also one of the results of a free market that you have this growing gap between the very wealthy and the rest. There is absolutely nothing wrong with those individuals who can attaining that great wealth. Equally, there is nothing wrong, from a social expectation, with those very wealthy contributing in propor- tion to their wealth to the economic well-being of the society that allowed them to accumulate that wealth.

Part of supporting the free- market system is supporting the kind of society that we all choose to live in, that the free-market system is part of. You can’t separate the two, Madam Speaker. No matter how much the Provincial Treasurer and his colleagues in cabinet and his colleagues on the backbench would like to, you can’t separate those two facts.

It is absolutely the basis of the kind of society, a society that’s based on fairness and equity and equality of opportunity, compassion, that you would want to deal with a tax system that doesn’t overly burden one sector, particularly when it favours that one sector that is already the most economically advantaged. That just doesn’t make sense. There’s nothing fair about that. The Treasurer was talking about who it is that pays the taxes, and he mentioned the 1 percent of Alberta taxpayers. Those are taxpayers that earn over $150,000 per year.

Under the provincial government’s tax plan they will receive a 15 percent cut in their provincial taxes. However, the 39 percent, the bulk of taxpayers, who earn between $30,000 and $70,000 a year, are going to receive less than 50 percent of that tax cut. They’re going to receive a 6 percent tax cut. Now, what’s fair about that? What is fair about that? There is absolutely nothing fair about that. I heard the Treasurer refer to the CEO of an energy company. You know, I just had an opportunity to review the annual earning statements of several CEOs of energy companies.

I guess I wasn’t surprised to see it, but before bonuses, before stock options, before you factor in the country club memberships and all those other things, it was not unusual to see those CEOs earning in excess of $1 million. When I have been inside their boardrooms and talked with them, I haven’t had one of them tell me that personally they’re

1262 Alberta Hansard May 2, 2000 thinking that they can’t afford to pay their taxes. So I would wonder what it was that the Provincial Treasurer was getting at when he quoted extensively from that correspondence. Is he trying to have us feel sorry for the oilmen in this province? They pay their fair share. Nobody wants them to pay anything more than that, but we don’t want all of the men and women who work in their corporations that help them create that wealth to pay more than their fair share either. We want them to pay exactly what they need to.

I hear members from the government chorusing in, like they are, and talking and calling us names in the Official Opposition, but let me quote for a minute from a paper called Why Fairness Matters: Progressive Versus Flat Taxes. It’s by Robert Shapiro, April 1996, written by the Progressive Foundation. I don’t need to be a front man for Dr. Shapiro. He’s a Harvard-trained economist. He’s well known, and I’m sure that the people in the Treasurer’s department well know Shapiro and his work. Let me quote just briefly. I’d be happy to table this if the government members want it, but let me quote just briefly what Dr.

Shapiro has to say. America’s wide-open markets accentuate the impact of all of these factors, so that those with more ambition, self-discipline, and talent can prosper greatly. Bill Gates and his investors, for example, would not have enjoyed as great a success in other advanced countries because their markets and laws would not have provided so hospitable an environment. And once a person or family’s economic success is secured, America’s open markets allow them to increase the value of their wealth at a greater rate than in most other places. The economic benefits of free markets are large and obvious.

But there are social costs, because our open markets and laws also produce harsher economic inequality than in other advanced countries – an urgent issue today when economic inequality is increasing rapidly and for reasons that most working people can do little about.

If the members of the government would like to find fault with the argument about the social justice aspect of tax policy, then I would suggest they do a little bit of research first and bring their reasoned comments to the floor instead of just yelling epithets across the way so as to discredit anybody that wants to stand here and defend the middle-income earner in this province, because it’s certainly not the provincial government that’s standing up for the middle-income earner in this province. Now, Madam Speaker, the underlying principle behind graduated income taxes is in itself simply equity.

In other words, fairness dictates the amount of tax individuals pay. Those with the greatest disposable incomes pay a higher percentage of their income in taxes. Those with less disposable income pay a lower percentage of their income in taxes. Most citizens accept this principle. Most people recognize that it is this principle that has allowed us to build public education into excellence and public health care into excellence and to provide an infrastructure that is excellent.

It is only this govern- ment which would attack public institutions, which would underfund public education, which would squeeze and starve public education. It’s only this government that doesn’t understand that principle of equity that underlies our progressive tax system. MR. CLEGG: That’s just garbage. MR. SAPERS: I hear the hon. Member for Dunvegan say that that is garbage.

If he would like to take to his feet and enter into debate exactly what is wrong with that, I’m sure his constituents would love to hear it, his constituents in Dunvegan, the men and women that farm there that I’ve had the privilege of getting to know. I would love to hear him explain to them why it’s garbage to be arguing for fairness in taxation policy. Maybe that Member for Dunvegan will stand and at some point, instead of just yelling th ings across the floor, he’ll enter the debate in the way that an honourable member would. Madam Speaker, the 11 percent rate has already been proven to be grossly unfair.

Many tax filers will have to pay more as a result of this rate. The Provincial Treasurer says: “Trust us. It’s the feds; they undermined us. They did it on purpose.” Talk about paranoia. 9:20 He says, “Trust us; we’ll get it right next time.” Well, Madam Speaker, we’re in the middle of a debate on Bill 11, probably one of the most contentious bills that this Legislature has dealt with. This government spent years preparing that legislation. They spent millions of dollars trying to sell it. They’ve had focus groups, they’ve done polls, they’ve hired outside consultants, and they brought in lawyers.

Then they brought in their bill, and they still got it wrong. They brought in 14 amendments. This government says: just trust us; we’ll get it right next time. If they can’t get it right on that, why should we trust them to get it right on anything? THE ACTING SPEAKER: Hon. member, we are dealing with an amendment to Bill 18. MR. SAPERS: I thought I was. So what we’re dealing with is a Provincial Treasurer that says: “Look, don’t read the black and white of the bill. Ignore the text of the bill. We really will get the rate right.

We really will.” Now, if it goes down to 10.5 percent, it’s still going to cost middle-income taxpayers more. If it goes down to 10 percent, it’s still going to cost middle-income taxpayers more. In fact, if the federal government carries through on its plan – and I will encourage them to do so – up until the year 2004 most taxpayers in Alberta will continue to pay more even if they drop the rate down to 10 percent.

If the federal government is able to get more aggressive on tax relief – and they’ve already outstripped this government in terms of tax relief – then they’re going to have to keep on monkeying around with the rate year after year, and we’re still going to see a lag. Taxpayers in this province are still going to take it on the chin and in the pocketbook. They’re never going to get it right. The easiest thing for them to do is to follow the lead of the federal government, that has been aggressive on tax reform, and to flow through every penny of those tax benefits by staying linked at least for the time being.

Let’s make sure we get the maximum benefit of those federal tax reforms. Now, the Provincial Treasurer says: what about bracket creep? Well, he ought to know all about bracket creep. His government has raked in millions of dollars in bracket creep, all the while pointing the finger elsewhere about people who tax too much. Now, the federal government has figured out a way to get rid of bracket creep. They simply indexed it. They indexed the brackets. You no longer have to worry about bracket creep. This Provincial Treasurer doesn’t seem to understand that you can index it, and then you don’t have bracket creep.

You don’t have to go to a single-rate tax. You know, the single-rate tax was the creation and the baby of the former Provincial Treasurer, who’s now out seeking greener pastures someplace else. Now, that Provincial Treasurer had his own reasons for bringing in that rate. He’ll say it’s because he thinks it’s for the good of all the people of Alberta, and I will say that maybe he thought it was for the good of him, but that’s an argument we can have in another place at another time. But he brought in that rate. Now, I would say to this Acting Provincial Treasurer that he doesn’t have to babysit.

He doesn’t have to look after that baby. He can recognize the fact that it was wrong-minded to do it. He can do just like the Republicans have done in the United States and what the

May 2, 2000 Alberta Hansard 1263 other right-wingers have done around the world: abandon this notion of trying to find the magic to make a single rate fair to everybody, go back to the principle of equity, maintain the progressive system, and take full advantage of the flow-through of the federal rates.

Then maybe we could have some all-party support, and we can get on with the job of maintaining an equitable and fair tax system for Alberta, not this piecemeal, incremental kind of tax reform where little carrots are dangled from time to time suspiciously close to elections and not this notion of just ideology that a flat rate must be best because it’s simple. You know what they say a bout complex problems and simple solutions. This government is making a habit out of lazy thinking and trying to find simple solutions to complex problems.

Well, that’s not the way it works, and if the government was at least consistent, they would recognize that this is where hard work would pay off. Tax policy is not simple. The answers to the problems cannot be found in simply pulling a number out of the air, applying it across the board, then closing your eyes and crossing your fingers. That’s not the way it works.

Now, according to analyses that have been done by individuals who are far smarter than I and far more experienced than I when it comes to tax policy – let’s take a look at what the 11 percent rate would do and why again we have to support this reasoned amend- ment. The breakpoints – and for those who are not familiar with that term, a breakpoint is the point at which a new tax rate will equal an existing tax rate.

In this case the breakpoint for the 11 percent tax rate, where it equals the existing 44 percent rate on federal tax, those breakpoints at the low end of the spectrum are $18,425, and at the high end of the spectrum, $68,400. Everyone in between those breakpoints, in other words everybody that earns more than $18,425 but less than $68,400 – and I think that would describe, if not most, at least many of our constituen ts – they would be better off, according to tax experts, with the existing tax system.

In other words, even if you just left the rate alone and flowed through the benefits of the federal tax reform, they would be better off. Now, imagine how increasingly better off they would be if you took the responsible approach, if you took the informed approach, dealt with bracket creep through indexation, and then lowered the rate at which you collect the tax; in other words, lowered the proportion of provincial tax payable as a rate of federal tax. All of those taxpayers, who would be better off even if you just left it alone, would be even better served.

I listened to the Acting Provincial Treasurer, and there is no justification for proceeding with this bill at this time. It doesn’t meet any of the fundamental tests. It may have been a politically expedient idea. It may have served the purposes of the former Provincial Treasurer. It may have made for some good headlines right after the budget, but upon careful analysis and careful reflec- tion, it just doesn’t hold water.

I would suggest that the government, in order to save itself from embarrassment, in order to prevent itself from having to come back into this Assembly time and time and time again and admit that it was wrong with this bill and keep on tinkering with the rate – in order to save them from all of that, I would hope that all members in a bipartisan way will support this reasoned amendment.

Then we can get back to the business of looking at the Tax Review Commit- tee, waiting for the government committee that’s looking at corporate and business taxes to report, and we can get back to ensuring that Alberta has a fair and competitive tax regime. We can get away from this chest pounding that the Premier and his col- leagues in cabinet want to get into to say: you know, we have the lowest taxes. I see that Ontario just did something with their taxes. You know, it’s like little boys in the sandbox. Now we’re going to get into this Premier saying: we ll, no; ours are really lower than yours.

You know, that is not the kind of stable business environment that Albertans and Alberta businesses want. What they want is a predictable tax environment. They don’t want to see all of this politicking around taxes. What they want is fairness, because business knows that that’s how business grows: in a fair and stable environment. They know that that’s what their employees want, what their investors want, what their customers want.

I would argue very strongly for the Conservative members of this Assembly to put aside their partis an interests, listen to the argu- ments, listen to their constituents, listen to what the experts have said about this bill, forget about all th e things that are going on in that other party’s national leadership race, put aside all of that and just focus on these issues at this time and vote according to what would be best for Alberta taxpayers.

I think that when they do that, when they make that reasonable assessment, they will come to the conclusion that Bill 18 is flawed, that this 11 percent flat rate is unfair, and that we really should get beyond this notion of trying to impose this arbitrary, simple solution, which just doesn’t fit. THE ACTING SPEAKER: The hon. Member for Calgary-Egmont. MR. HERARD: Thank you, Madam Speaker. It’s indeed a pleasure to stand and speak to the amendment to Bill 18. First I have to look at the amendment itself. Typically an amendment in second reading is somewhat unusual.

It’s usually a procedural ploy that is used by oppositions to delay the passage of legislation. We’ve seen that not only in this bill, but we saw it in Bill 11, and I guess we’ll see it some more if more come up. 9:30 It’s kind of interesting, I think, when you look at the history of why we have Bill 18 in front of us at the moment. I went back into my files to try and find – I couldn’t believe this. Way back in February 1997 is when the hon. Member from Cardston-Taber- Warner joined the Tax Review Committee, and then shortly thereafter I was asked to join the Tax Review Committee. That’s in 1997.

January of 1998 is when the Tax Review Committee of this province delivered the report and made the recommendation for the bill that we have in front of us today. So we have to remember that back on January 26 of 1998 the tax situation in this country was nowhere on the radar map, but as a result of the Tax Review Committee’ s report in this province, the whole country woke up to the fact that we as Canadians were being overtaxed and that bracket creep kept continually eroding and eroding our take-home pay.

I can remember personally that as a young individual trying to raise a family, the only way I could get ahead was to work overtime, but the harder I worked, the less I took home. So we have here a situation where the people across the way are telling us, you know, that we should love that, we should be happy to pay more tax. I think what we have to do is compare the philosophy of those across the way who want to have a progressive tax system. They’re telling us that the tax system that we’re proposing in this bill is regressive. They want a progressive tax system.

What a progressive tax system does is social engineering on the input side, because it taxes people at different rates. It discourages success. I know that I certainly was not encouraged by having to work a bunch of overtime and then taking home less and less and less. So they want to do their social engineering on the input side. That’s what progressive taxation’s all about. Well, I think that this government has shown that social programs

1264 Alberta Hansard May 2, 2000 need to be done on the output side, not on the input side, and that’s what a flat tax does. What is more fair than everyone paying the same rate of tax? And they’re talking to us about fairness? I think you have to take those things into account and remember that this was back in 1998. In 1998 the debate wasn’t about taxation in this country, but it certainly has turned to taxation in this country since this government took the lead, as it has in many other ways. I remember a presentation from a housewife in Calgary, as a matter of fact.

I’m not sure if it was the first presentation that she ever made in her life, but she was there asking: why does the tax system punish single-income families? Why does the tax system punish single-income families? A two-income family pays less than a single-income family earning the same amount. You know, that lady made a huge impact on the committee that sat and listened back in 1997. Today we have the result. We have the result that is equalizing the personal exemptions, the $11,620 per person, which takes away the discrimination that the tax system had against single- family incomes.

You know, if a family wants to have the mother stay at home and raise the children, why should they be penalized by the tax system? In this province, we’ve done something about that. We’ve changed it, we’ve fixed it, and it’s no longer a penalty. I don’t understand the arguments that some people make with respect to who pays for what. Well, it seems to me, Madam Speaker, that the top 10 percent of the earners pretty much pay for everything. Like, who supports our charities? Who supports our arts programs? Who buys the opera tickets and the symphony tickets? Who are those people?

The people across the way would want us to tax them more. They’re already paying more than their share, and I think they very much deserve a break. So, Madam Speaker, at this point I would just simply move that we adjourn debate on Bill 18. [Motion to adjourn debate carried] Bill 23 Apprenticeship and Industry Training Amendment Act, 2000 [Debate adjourned May 2: Mr. Gibbons speaking] THE ACTING SPEAKER: The hon. Member for Calgary-Buffalo. MR. DICKSON: Thank you very much, Madam Speaker. A couple of comments with respect to Bill 23, the Apprenticeship and Industry Training Amendment Act, 2000.

Firstly, let me start off on a positive note by acknowledging what I think has been very broad and very positive consultation that has been undertaken by the Alberta Apprenticeship and Industry Training Board and by advanced education and career development, as it then was. I can say that all of the information I have is that in fact this has actually been a far-reaching consultation, and the government deserves credit. The government deserves credit, Madam Speaker, for the consultation they’ve undertaken.

I think the government also deserves credit for putting together in B ill 23 a series of pos itive changes that reflect what industry has identified and required. So there are some very positive elements in Bill 23. Now, I’ve had a chance to go through the original act, and it’s actually some 39 pages in length. There’s a lot of material in it.

Although the minister of intergovernmental affairs, I think, who introduced this bill, talked about the consultation, talked about this being something that’s responsive to industry requirements and something that people in the respective sectors wanted, I wanted to test that with a couple of specific questions. I’d take the minister and anyone else who’s interested, Madam Speaker, to some of the questions I’ve got. [The Deputy Speaker in the chair] I look for example at

section 3(c). We have provision there for adding a whole range of new things. These have to do with functions of the board. Now, that’s an essential part. Maybe if the minister has answers to these questions – she seemed well versed in the issue when she presented it this afternoon – she could just fire over a note with the answers, and we can save some time. If she looks at page 3 of the bill, we have a provision there that the Regulations Act – this is the new proposed section (3). The Regulations Act does not apply (

a) in respect of any documentation prepared by or on behalf of the Board relating to the carrying out of any functions under this section, or (

b) to orders . . . under subsection (2). Now, what we find in subsection (2) is “the establishment of standards or requirements.” This is “criteria or requirements for the granting and recognition of trade certificates,” the “establishment of standards or requirements.” These are not one-off things. These are not transitory things. These are standards. One would think, Mr. Speaker – would you not? – that a standard should be able to achieve as much notoriety as possible. It should be quickly referenced and readily referenced by apprentices and by employers and by people in a particular industry who wanted to know what those standards were. But what’s interesting here is that in the proposed

section 3 the Regulations Act does not apply. 9:40 Now, Mr. Speaker, members may be saying: so why would the Regulations Act not apply? The Regulations Act is not a very long statute. It’s only about six pages long.

Section 2 has to do with filing the regulation with a registrar. So one might ask: why would it be that if we are going to have standards set in one of these areas that are identified on pages 2 and 3, we not be prepared to have that filed with the registrar? Is there a good reason for that? The Minister of International and Intergovernmental Relations didn’t share with us what the reason would be that those regulations wouldn’t be subject to the Regulations Act. Why is it that in this long list – and what have we got here? Probably about 20 kinds of orders the board would make.

Why wouldn’t we make sure that that was as publicly available to anybody who’s interested in finding that? I’m going through the Regulations Act. What it requires is pretty minimal. You file it with the registrar. It’s published in the Alberta Gazette. Now, there are not a lot of people that read the Alberta Gazette, but at least anybody who’s interested in information knows that’s the place you can go to find these things. There are wonderful librarians.

We have one of the finest public library systems anywhere in North American in this province, and whether it’s the Marigold library or the Calgary public library, there are people who are trained. They’re professionals, and they can assist people to find it very, very easily, very, very quickly. But if it’s not published, if it’s not gazetted and it’s not filed with the registrar, you know what happens, Mr. Speaker? That tradesper- son or that apprentice or that employer now has to go on a where’s Waldo sort of exercise to try and find out where this regulation is, where this order is.

It’s not filed in any public place, and it’s not published in the Gazette. Is it

section 2 in the filing requirement that the government has a problem with? Is it

section 3 of the Regulations Act, which has to do with the gazetting, or is it

section 5 perhaps?

Section 5 requires

May 2, 2000 Alberta Hansard 1265 the registrar of regulations to file a monthly report. Can the minister of intergovernmental affairs can tell us which one of these causes the problem? Why is it that these would not apply in this case? All you need are 20, Madam Minister. All you need are 20 members. Now, that’s about it. It seems to me that that should be a pretty straightforward matter for the government to explain, but that minister has not chosen to do it. While there is still a quorum here in the House, Mr. Speaker, I wanted to ask that question. I don’t know what the answer is.

I hope the minister of intergovernmental affairs will share with us that explanation because I don’t know what it is. Maybe the MLA responsible for the regulations task force has an answer to it, and I’d be happy to accept an answer from that member as well. So I have that question. Then I go on in the bill to

section 8, which appears on page 6. We have the new proposed 13.1(1): “The Minister is responsible for the administration.” Then we see subsection (2): The Regulations Act does not apply in respect of any documentation prepared by or on behalf of the Minister relating to the carrying out of any functions under this section. So I have to ask in respect of

section 8: which element in the Regulations Act causes this government a problem? Is it

section 2? Is it

section 3? Is it

section 5? Will the minister tell us that? Will any other member of the government stand up and tell us why you have to carve that out from under the Regulations Act? And I go on. If members look at

section 16 of this bill, on page 11, we’re going to have a new subsection (6), and what does it say? Once again, “The Regulations Act does not apply in respect of any authorization.” Now, why would that be, Mr. Speaker? Why would it be that the government would want to take these things and not make them as widely available as possible? Why do we want to closet them away? At this point, Mr. Speaker, let me tell you of a problem I’ve experienced in terms of trying to access material. There are sort of three different kinds of subordinate legislation we run into.

We’ve got the regular gazetted regulations under the Regulations Act, and any Albertan can find those that has access to the Internet. You can find those things, and you can find them readily. [interjection] Well, you normally can, Minister of Health and Wellness. The second kind of subordinate lawmaking is a thing called ministerial regulations, and then the third one is ministerial orders. What happens if I as a citizen want to find those things? Now, maybe in the Department of Health and Wellness it works differ- ently, but here’s what you have to do.

You have to phone up the minister’s office and say that I’d like to see a regulation or a ministerial order. They say: “Well, it’s not under the Regulations Act. We have that in our library.” I say: “Fine. May I come over? Is that library open to the public?” “Oh, no, no. This is a ministerial library, a departmental library. It’s only available to people who have the permission of the minister to access it.” Now, I’m a tenacious guy, and I spend lots of time in Edmonton, so maybe I’ve got the time to do a little phoning around and show up in that minister’s office and ask where that stuff is.

But, you know, our job is not just to accommodate MLAs, who have to persevere. Our job is to accommodate individual Albertans who may want to find out something about the apprenticeship program and want to find out what those standards are. Why should you have to go through the hoop and hurdle and do this bureaucratic dance to find out what’s in the regulation? All the government had to do was say: we make it subject to the Regulations Act, and anybody can access it through any public library really fast, really easily. Ideal. Now, the government has chosen not to do that, and my question is: why?

You go on and you look at

section 17 of this bill, and what have we got there? We’ve got, lo and behold, on page 12: The Regulations Act does not apply in respect of any order made or documentation prepared by or on behalf of the Executive Director relating to the making of an order under this section. What’s to be hidden here? Why not simply gazette it so that people can access it and it’s in some standard place?

I think it’s preposter- ous that any Albertan who wants to find out what the regulations are, what the standards are with respect to an apprenticeship program, has sort of got to go on bended knee and beg his or her way into a department library and hope that there’s some librarian in the department of health – oh, I don’t mean to pick on the Department of Health and Wellness – in any department so that they can access it. This is not accessibility. This is not empowering individual citizens to get this material, and it’s not good enough. Then we go to

section 23 of this bill. It has to do with regulations again. It’s also part of

section 20, which makes a further change here to the regulation provision, and it’s not clear. It appears these may be subject to the Regulations Act. Here’s what we’re left with under Bill 23. You have some standards which appear to be gazetted and filed with the registrar, but you’ve got a whole lot of other standards and things that are not gazetted, and you have to go on a bit of scavenger hunt to find those things. All I’m asking is: why?

I don’t profess to know very much about the administration of the apprenticeship program, so my question is: give me a reason why those things can’t be done in gazetted regulations; give me a reason in terms of why these things have to be such a big secret. I’d be happy to see that. Now, the other question I’ve got.

If you look at a question-and- answer sheet that was produced entitled Proposed Changes, Appren- ticeship and Industry Training Act, produced March 20 of 2000, just a little more than a month ago, there’s a question there where they talk about what’s going to be done by way of regulation, but it doesn’t address this question of why these things have to be a secret. I just find that a curious thing. Now, I expect I have some col- leagues that are going to be wanting to join debate on this in three minutes and 32 seconds, and I know that they’re going to have an opportunity to further develop some of these themes.

If you were to look at page 6 of this backgrounder that’s been produced – and I’m not tabling it because my understanding is it’s already been tabled. If anybody wishes to see it, I’ve got a copy, and I’d be happy to have a page take one over. On page 6 of this backgrounder that accompanied the changes in the bill, we’ve got this question: will industry be consulted on proposed changes to the regulations? Now, it doesn’t say whether those are the gazetted regulations under the Regulations Act or whether those are the ministerial regulations, which are going to be secreted away in a departmental library.

We don’t know that. 9:50 Here’s the response from the government department: members of the industry advisory committees, key stakeholders, and the public will have an opportunity to review and comment on draft regulations later this year; we hope to complete a review of the regulations by December 2000. Great to have a consultation with stakeholders and people who have been involved, but what happens to the rest of us? You know, why are regulations made only in consultation with those people that government deigns to involve?

What about the stakeholder who is not identified by the deputy minister as a stakeholder? What about somebody who’s forgotten on the list? Why wouldn’t we publish the regulations, not just for the benefit of so-called stakeholders but publish them on the Internet? It’s really easy to do. The government spends that $8 million. The Public Affairs Bureau produces some wonderful web sites. I’m very much in awe of the Department of Health and Wellness web site. Terrific. I question the accuracy of some of the information on there around Bill 11, but it’s a good pl ace to go to be able to find out information.

It would be no trouble in the year 2000 to get the web

1266 Alberta Hansard May 2, 2000 master to put up the draft regulations. Then everybody who has access to a computer screen anywhere in the province . . . [interjec- tions] I think I have some colleagues that are concerned that I may not be delivering the corporate message here. They may think I’m on a bit of a frolic on my own, Mr. Speaker, but I want you to know that I’m speaking to th e things that have sort of attracted my attention on a bill that I think is of some concern. Those are my questions.

I guess I’m open to information from people in the gallery who know more about apprenticeship, from people in the Assembly, from anybody outside who reads Hansard. If they’ve got answers for any of those things, I hope they’ll send me a fax or an e-mail so I will have answers to that. I hope we’ll have answers to that before we have to vote on Bill 23. I want to thank my colleague for Edmonton-Gold Bar for what I thought was a really excellent analysis he did of the bill the other afternoon.

It was helpful to me, and I’d commend that to all members who are trying to figure out whether they should support this bill or not. In the moment I have left, I’d say to the government: here’s an opportunity. This could be a win/win bill. You can pass some changes that industry wants and the people affected want, but you can also signal that government is a lot more than just talking to a few selected stakeholders.

Whether it’s Bill 11, where you take your advice from the appointed regional health authorities – it’s sort of akin to drinking your own bathwater – or whether you take a broader consultation to involve Albertans, that’s really what we want to hear. It’s the same principle, I think, in terms of both bills, and I think we can do so much better. My inclination when I pick this bill up is to support it, but I could do that with an awful lot more enthusiasm and I could remove that sort of niggling doubt I have if I can get answers to those specific questions I’ve got.

Those are the questions I’ve got, and I’m looking forward to other analysis of Bill 23. Thank you very much, Mr. Speaker. THE DEPUTY SPEAKER: May the Assembly grant consent to briefly revert to Introduction of Guests? [Unanimous consent granted] head: Introduction of Guests THE DEPUTY SPEAKER: The hon. Member for Spruce Grove- Sturgeon-St. Albert. MRS. SOETAERT: Thank you very much, Mr. Speaker. It’s my pleasure to introduce to you and through you to members of the Assembly two concerned citizens who have been outside the last couple of nights concerned about Bill 11 and are here tonight to hear the debate on it.

One is from the constituency of St. Albert and has expressed her concerns to her MLA. Her name is Diane Gorman, and the other is a woman from Edmonton-Manning, and her name is Trudy Grebenstein. I believe they’re in the members’ gallery, and I would ask them to please rise and receive the warm welcome of the Assembly. head: Government Bills and Orders head: Second Reading Bill 23 Apprenticeship and Industry Training Amendment Act, 2000 (continued) THE DEPUTY SPEAKER: On Bill 23, the hon. Member for Edmonton-Meadowlark. MS LEIBOVICI: Thank you, Mr. Speaker.

It’s a great pleasure to rise this evening to address Bill 23, the Apprenticeship and Industry Training Amendment Act, 2000. I listened very carefully to the comments that were made by my colleague from Calgary-Buffalo, as well I have looked at the Blues of the remarks that were made by the Member for Edmonton-Gold Bar as well as the Member for Edmonton-Centre and have also looked at the document that was put out by the Alberta Apprenticeship and Industry Training Board, the questions-and-answers document.

In putting together the speeches and some of the comments that have been made, it is a fact that there has been a fair amount of consultation with regards to the proposed amendments to this particular bill, and there are several recommen- dations that have been made that will improve the apprenticeship and industry training system for employers, employees, and apprentices. There are still some outstanding questions as to whether the proposed amendments are in fact comprehensive enough or whether in fact there are outstanding concerns still around certain sections of the bill.

In particular I understand that there are starting to be expressed some concerns by some of the trades with regards to sections 16 and 17 of the bill, that would amend sections 23 and 24 of the act. I have had the experience in the past to work with the Member for Medicine Hat with regards to the Health Professions Act, which looked at putting together changes to a large number of bills and putting together a consensus around a long process that had occurred with regards to the consultation around that particular act.

I think there are parallels between what happened with the Health Profes- sions Act and what we are perhaps seeing right now with Bill 23, the Apprenticeship and Industry Training Amendment Act. The reality, Mr. Speaker, is that when the consultation occurs with different groups and that consultation is synthesized and then put forward into legislation, sometimes some things are missed out, and in fact when I think back again to the Health Professions Act, we had some difficulties that arose out of the drafting of the legislation with regards to what the impact would be on firefighters throughout the province.

That impact was unintentional, yet the wording in the legislation made it a potential for there to be huge costs to the cities of Edmonton, Calgary, Lethbridge, I believe, and some of the other cities that have firefighters on staff.

There were also potential effects on the individuals who do the lifesaving on ski hills, the ski patrol, and that was also an unintentional effect of the drafting of the legislation. 10:00 So here we have something very similar in Bill 23, I believe, where it seems that in the majority the bill has addressed some of the concerns that have been developed and brought forward over a period of four years, yet there is still some fine-tuning that is required to occur. I would hope that the hon.

Member for Edmonton-Gold Bar will have the opportunity to work with the Minister of Learning to work out what some of the glitches are within the act, as addressed by some of the trades at this point in time, to make this piece of legislation reflect exactly what the consultations were that have taken place over a long period of time, because it would be a shame if in fact after four years of work on a particular bill there are some things that are not quite right.

Unfortunately we sometimes see, in the haste of this government to push through legislation, that we have to retroactively go back, whether it’s in the fall session or the next year, to amend legislation that could have been amended when it was first introduced. That is, I think, something that needs to be looked at very, very closely. Specifically where the concerns are is the fear that competency based training will find its way into the apprenticeship trades.

May 2, 2000 Alberta Hansard 1267 Again, my colleague from Edmonton-Gold Bar had addressed that issue in looking at the differen ces between the different kinds of trades, in that there are designated trades and there are occupations, and that there is sometimes optional certification of trades and there is sometimes compulsory certification of trades. In fact, when you look at

section 22.1, which follows after

section 22, what may well occur is that there are going to be exemptions to the compulsory certification of tradespersons, so that is a huge, huge issue. If you go on a little bit further to

section 23, the question was brought up by the hon. Member for Edmonton-Gold Bar as to what is going to happen with apprenticeship programs in regards to technical programs and standards, the documentation of the program or the examination. Now, again to go back specifically to the concerns of at least one of the trades that will be involved, what is indicated is that there’s a fear that competency based training will find its way into the apprentice- ship trades. While there are some positives to competency training, it can, through abuse, lead to the breaking down of high standards that exist at present.

This is actually a quote from a letter, as well as that “some form of qualifier, for example, written in the Act or in the Regulations that Level Three does not do Level Four work” is required. In other words, what’s needed is “protection of some sort that protects the Journeyman.” So this is a very, very key concern that I’m sure can be addressed quite easily if there is a will to do so.

I would hope that within the time available before the Assembly recesses for the summer break, there will be the ability to fix that particular concern within Bill 23 or to hold it over until the fall session so that in fact it can be as good a piece of legislation as it should be after four years of consultation.

Now, some of the questions that I have and that don’t seem to be addressed within the bill itself – at least they seem to be still outstanding, from the document put out by the Alberta Apprentice- ship and Industry Training Board on March 20, 2000 – are with regards to the fact that there is some concern around the apprentice wage percentages and that these wage percentages may pose a problem for certain sectors of industry because of the way people are employed.

There is a suggestion that the board will ask the appro- priate provincial apprenticeship committee to examine the need to regulate apprentice wage percentages in their particular trade. I’m wondering if there was any attempt to address how long that process would take, because if in fact there is some kind of disparity in terms of those wage percentages, people should not have to wait three years for that to be addressed. In fact, there should be some kind of finite time when this issue is addressed.

Another key issue is around the journeyman/apprentice ratios, which are suggested to remain in regulations, and that the norm of one journeyman to one apprentice, as has been suggested through the consultation process by the various groups, may not guarantee suitable supervision and training of apprentices.

There’s an indication that the board will explore other ways of ensuring the quality of training, and I wonder whether that is in fact a strong enough promise, as it were, to the stakeholders involved and whether or not there should be something outlined as to what those other ways are of ensuring the quality of training. There are some issues as well that were pointed out with regards to looking at the changes.

I had mentioned that one of them could be made to provide for a competency based certification program in designated occupations – and that is still remaining as a key concern – and that there are changes that could be made to allow the board to address and implement solutions to the various problems being experienced with the description of some trades. So it would appear that in fact that has not occurred in the act and that the Apprentice- ship and Industry Training Board is still requesting that that occur.

Also, another change that could be made to the act is to strengthen the operation of industry advisory committees. Without sitting at the table with the stakeholders involved, it would be difficult for me to say whether or not these are key changes that should be addressed prior to the passage of the bill. However, it would be useful information for the Official Opposition to find out from the sponsor of the bill, the Minister of Learning, whether or not these in fact have been or will be addressed or what the training board has indicated with regards to these potentially not being addressed in the bill.

The other types of issues that have come forward are in terms of information. One of the questions is: how would apprentices and employers get program and process information? When I was labour critic for the Official Opposition, the issue of apprenticeship and the nonsupport, in a sense, at that time of some of the apprenticeship programs was a very large issue within the labour community.

One of the ideas that was put forward often by the labour groups was to bring programs and program information into high schools so that students who were making their career choices would be able to make a career choice that potentially would guide them into some of the apprenticeships and some of the trades. I don’t see that that has been at all addressed in this particular question.

Granted, that’s not perhaps what it was geared towards, but I would like to see some recognition of the fact that there needs to be more information provided to our youth to make decisions as to what path their life will take after high school, and this is one piece of information that I don’t think is always provided even when they do their career days.

There could be more focus put on that as well. 10:10 There are a number of other recommendations that have been put forward with regards to this particular piece of legislation, and I know the industry does hope that this legislation will be passed within the year 2000. Again, I think that is not an invalid hope. I think that is something that coul d well occur, but there are, as I indicated at the outset, some outstanding issues that I believe can be worked out and addressed in terms of where this legislation is going.

There is one other issue the Member for Calgary-Buffalo did talk to, and that’s with regards to the use of the Regulations Act and why in fact there is a need to exempt some of these committees from the Regulations Act. There are a number of committees that are going to be established, I understand, under Bill 23. The question is whether these committees do in fact need to be established as separate entities. Who are the participants on the committees going to be? How will the decisions be made as to the choices of the individuals that are going to be appointed to these committees?

Why can’t the issues, I guess, work through the existing apprenticeship committees and within the existing structure? There’s a whole other stream of questions in terms of accountabil- ity. Who is the committee going to report to? What are the interfaces between the various committees that are now being formed? What is the reporting mechanism? Are these going to be open meetings or not?

In fact, again when I reflect back to the Health Professions Act, it’s very clear as to how individuals were appointed to the boards of the various professions, what the compo- sition of those boards was going to be, what the reporting mecha- nisms are, whether or not they’re going to be held in public. That’s laid out in that particular piece of legislation, so the question again is: why is this piece of legislation so different? What makes the requirements of the apprenticeship and industry training sector so very different from what is happening in other sectors in this province?

1268 Alberta Hansard May 2, 2000 The Regulations Act, by not having the act applied to any of the documentation prepared by or on behalf of the minister relating to the carrying out of the functions of the act, is also of concern, because in fact a lot of that can be done in secrecy. We know that very often this government does a lot of its business behind closed doors, either through orders in council or through regulations.

What we need to ensure is that unless there is some very good reason for any decisions to be made in secrecy, those decisions be made openly and that there’s accountability built into this whole process. So those are some of the comment s I have with regards to this particular bill. I would very much appreciate having some of those concerns answered in order to make a decision as to whether or not this bill is supportable in its current form. As indicated, it seems that a lot of the concerns of the industry and the other stakeholders have been addressed, but there still remain some that have not.

Again, after four years of consultation I find it hard to believe that those concerns were not brought up, but what I think may have happened is that some of the more particular aspects of a bill that is technical were not well understood so that the drafting in fact has managed to do what the consensus did not indicate should be done. With those remarks, I will take my place, and hopefully we’ll have some answers to those questions coming in the near future. Thank you. THE DEPUTY SPEAKER: The hon. Member for Spruce Grove- Sturgeon-St. Albert. MRS. SOETAERT: Thank you very much, Mr. Speaker.

As I look at Bill 23, the Apprenticeship a nd Industry Training Amendment Act, it brings to mind several things and how very important good legislation is in this case. I think of standards when we have people building our homes, people doing work in our homes, and our place of work. I think I came to appreciate the trades a great deal when we built our home over eight years ago. I would see different skilled people working. I had no idea how much work and how much skill it took to put a home together. I gained a great deal of respect for those people who work very hard and are very proud of the job they do.

In that, I also came to rea lize that those skills aren’t just something you get out of a Reader’s Digest book. In fact, as an example, we once bought an extra stove to put in our basement. You know, with the mega family do’s I could have an extra stove in the basement. My husband grabbed the Reader’s Digest electrician book. [interjection] Yes, it’s a Raymond story. Sure enough, he connected it, and it worked. I was so happy. It worked. The stove in the basement worked. But you know what? The stove upstairs did not. So as I cooked, I was getting into better shape as I went up and down the stairs.

But we finally called an electrician, and lo and behold both stoves worked safely. From that time on, we’ve agreed that we must do what we do well and call in those to do what we don’t do well. So there’s just a simple example from home where you can appreciate that people need to be qualified and need to have standards, and those people themselves feel it’s very important that that is implemented for them. Now, from my understanding of this bill there’s been quite a bit of consultation, and that’s good. I commend the minister and his work on that, but I also know that there are still some outstanding concerns.

One of them has to do with

section 23 and

section 24, and there is a concern expressed that competency-based training will find its way into the apprenticeship trades. Of course, it’s good that we have competency training, but we have to watch that it doesn’t lead to the breaking down of high standards that exist at present. “Some form of qualifier, for exam- ple” – and I’m sure most of us have this letter that was sent to us – should be “written in the Act or in the Regulations that Level Three does not do Level Four work.” It’s the whole issue of de-skilling.

I think we have to be very cautious that our legislation does not allow that to happen and that it safeguards that you are qualified to do the job you do. 10:20 The other thing that I have seen concern expressed about is proper inspections of those who do the work within the trades and in the training, that they are properly supervised. I think the Member for Edmonton-Gold Bar gave a very good example of what happened at Swan Hills. Regretfully, the way things are now, we may never find out what happened there because of some court order to keep things under wraps for a certain length of time.

So we don’t know what happened there, and I would hope another fiasco like that does not happen until we find out what went wrong and take steps to improve it. I would say that would be one thing this government would want, to find the answers and to make sure they are improved from there. [Mr. Herard in the chair] Another

section of concern that was expressed was

section 15, where exceptions about compulsory certification of a trade . . . MS BLAKEMAN: What kind of exceptions? MRS. SOETAERT: Well, it seems that the minister may make regulations permitting a person who is not otherwise permitted under

section 21 to work in that trade to carry out work or perform tasks, activities and functions in respect of one or more specific undertakings or a portion of those undertakings that come within the trade, and for that purpose may . . . and then it goes for (a), (b), (c), and (d). Now, I would think that once again we’re giving the minister some responsibility he may not want or may not have the expertise to administer. That’s nothing personal against the minister. I’m saying a generic minister. A generic minister wouldn’t want that responsibility. There’s no such thing as a generic minister. I know.

But we’ll move on. AN HON. MEMBER: There are junior ministers. MRS. SOETAERT: There are junior ministers. I would like to continue with the concerns about the exceptions to the compulsory. One described here, which the minister would have control over the regulation of, would be to (

a) prescribe the tasks, activities, and functions that a person may perform in respect of those undertakings; (

b) prescribe or otherwise establish the qualifications or training that a person must have to carry out work or to perform tasks, activities and functions under this section; (

c) prescribe any terms or conditions that a person is subject to with respect to carrying out any work or performing any tasks, activities or functions permitted under this section; (

d) provide for any matter that the Board considers to be related, incidental or ancillary to permitting a person to carry out any work or to perform any tasks, activities or functions under this section. So, Mr. Speaker, we have some concerns that there are regulations that aren’t clarified or that are lumped under the Regulations Act, where we’re not quite sure where they’re going to be accessible. That has to be very, very clear. You know, anybody should be able to access those regulations, not just people within the trades.

Certainly they should be able to access it, but certainly anyone out of interest should. It may come just by chance in your life that suddenly you are building a home. You are involved maybe just on

May 2, 2000 Alberta Hansard 1269 a committee that may be doing renovations to a school. I’ve seen that happen. In fact, at Woodhaven school out in my riding – and it was a good move on the board’s part, a very good move – they involved parents and businesspeople, builders and students to look at what changes would make that school the very best. They learned a great deal about what it takes. You know, you just can’t add a wall here and cut down a wall there. They worked with the tradespeople, with the architect, and I would say that that’s one of the most successful projects in a renovated school in Alberta.

I know the Minister of Infrastructure was at the grand opening of that new wing, as I was. It was a great event because so many people got involved and learned about what it takes to build something that would accommo- date so many people in so many different ways. So that’s an example of how every one of us should care about the qualifications, the standards of the apprenticeship and industry programs and the supervision of them and the evaluation of them. Definitely I think that the people who most want this are the people in the trades themselves.

They take great pride in their work and they want those standards. They want to be safe. They want the bridges that they build to be safe, and they want to be proud of them. So they expect that those standa rds will be set by this government through legislation and implemented and supervised on those standards of safety and accountability, the ability to be inspected and to do quality work that they are proud of. As you know, I used to teach. I was in a w onderful composite school that had many students geared towards apprenticeship and the trades. They loved the welding class.

In fact, they built a horse trailer once and all kinds of things. I don’t know why they didn’t like my English class as much as their welding class. I tried to make it as interesting as possible. The reality is that the students were very, very talented at other things. I think we all have to recognize the diversity of our wonderful province and all that these young people are looking at. They’re going into these trades, and they have to know that there are expectations of them. People in the trades want to say: “I’ll show you how.

This is what you have to pass, and this is what to do, and these are the standards we proudly meet.” I would say that this piece of legislation has to do that. It has to ensure that there are standards. It has to ensure that inspections will be properly done, that regulations are available, open to everyone so that everyone knows what they are and people can follow them. Mr. Speaker, I’m glad this bill is before us. I know my colleague from Edmonton-Gold Bar has expressed some concerns, and maybe we’ll get those answers, maybe in second reading, maybe in Committee of the Whole.

Maybe he and the minister will have a chat and some of it will be explained. I look forward to further debate on this. I’m glad the bill is here. I’m not a hundred percent comfortable with it for the reasons I’ve indicated, especially sections 23 and 24 and also

section 15. Those are the things I am hoping a good piece of legislation will bring forward. I know that the people in apprenticeship programs and training programs and in the tr ades want this to be a real solid piece of legislation. I think if we work at that, it could be that. Thank you very much, Mr. Speaker, for the opportunity to speak to Bill 23 at second reading. THE ACTING SPEAKER: The hon. Member for Edmonton- Glenora. MR. SAPERS: Thank you, Mr. Spea