1982 Legislative Session: 4th Session, 32nd Parliament

Hansard

The following electronic version is for informational purposes only.

The printed version remains the official version.

Official Report of

DEBATES OF THE LEGISLATIVE ASSEMBLY

( Hansard )

FRIDAY, SEPTEMBER 17, 1982

Morning Sitting

[ Page

9241 ]

CONTENTS

Routine Proceedings

Coal Amendment Act, 1982 (Bill 78). Second reading. (Hon. Mr. Smith)

Mr. Howard –– 9241

Mr. Levi –– 9242

Hon. Mr. Smith –– 9242

Homeowner Interest Assistance Act (Bill 79). Second reading. (Hon. Mr. Brummet)

Hon. Mr. Brummet –– 9243

Mr. Gabelmann –– 9244

Mr. Ritchie –– 9246

Mr. Stupich –– 9247

Hon. Mr. Chabot –– 9249

Mr. Hall –– 9250

Hon. Mr. McGeer –– 9252

Mr. Nicolson –– 9252

Hon. Mr. Williams –– 9254

Ms. Brown –– 9256

Motor Vehicle Amendment Act (No –– 2), 1982 (Bill 69). Hon. Mr. Fraser

Third reading –– 9258

FRIDAY, SEPTEMBER 17, 1982

The House met at 10 a.m.

Prayers.

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

gallery this morning are two very good friends who are frequent

visitors to this building. They are supporters of the British Columbia

Social Credit Party and very hard workers for the party. I wonder if

all members would welcome Ursula Forrester and Lee Mesker.

Orders of the Day

HON. MR. GARDOM: Adjourned debate on second reading of Bill 78, Mr. Speaker.

COAL AMENDMENT ACT, 1982

(continued)

MR. HOWARD: I thought he was rising in his seat to resume the debate, but he appears to have been rising to close the debate.

HON. MR. SMITH: No, Mr. Speaker....

MR. SPEAKER: I can only recognize one member. The member has concluded his remarks.

MR. HOWARD:

No, I say that if I had not risen...an assumption on my part, Mr.

Speaker. I assumed the minister knew what he was doing, but apparently

he doesn't.

MR. SPEAKER: Hon. member, the debate was

adjourned by the minister, at which time, prior to the question, the

Chair would have to put the question before the debate would be

concluded.

MR. HOWARD: I'm just trying to protect the rights of the minority, Mr. Speaker.

MR. SPEAKER: Thank you for the assistance, hon. member.

HON. MR. SMITH: Mr. Speaker, I did move second reading and I have concluded my remarks.

MR. HOWARD:

Then I don't know why we didn't have the vote last night. Maybe the

minister hadn't yet received the proper instructions. I have just a few

brief comments to make about the bill before us. Tell the minister that

the remarks I'm about to make were based upon notes prepared for me by

the same person who prepared the notes for the minister in his remarks

yesterday.

This affords us the opportunity to examine briefly why it is that we in British

Columbia have always — and more so lately, especially with respect to northeast

coal — come off second best in our dealings with other countries, particularly

our dealings with Japan. I think we need to appreciate what goes on here in

B.C. with respect to resources. That's partly what this bill is about. It

talks about licences, leases, exclusive rights to mine; exclusive rights to

prosecute to the full authority that the holder of a lease or licence has

under the act. What that does is say that the Crown, presuming to act on behalf

of the people who are the owners of the resource, would give some private group,

some corporation, a licence or a lease to do something with respect to coal.

It would give them the exclusive right to mine that coal.

the followup of selling the product, in this case coal, to some other

country — and I'm referring to Japan in this instance, because that's

the most notable recent one that we need to examine — the government or

the Crown, on behalf of the people, takes a detached view of the

procedures relating to the sale of the product to the other country. In

other words, there is not a companionship between government on behalf

of the people, and the coal companies on behalf of themselves, to

ensure that the best possible advantage accrues to the people of

British Columbia from their resource. That detachment, that aloofness

of government on behalf of the people from the coal companies is what

gets us into difficulties.

In Japan they have a different

philosophy, policy and structure with respect to how things occur in

dealing with other countries on either an export or an import basis.

Following the end of the American occupation of Japan, shortly after

the Second World War, the Japanese government, the Japanese people, the

Japanese corporations established thereunder, and the trade union

movement to a large extent, although not exclusively, decided that they

would work in a cooperative way for the benefit of all of Japan — not

just for the benefit of a particular corporation, whether a steel

company, an automobile manufacturer or a camera company, whatever the

case might be. They determined that cooperation between government,

business and the workforce in Japan was necessary to serve the

interests of Japan to the full. It was that cooperative spirit, that

cooperative policy, that declaration of intent to work for the benefit

of all of Japan that has seen Japan arise from the ashes following the

Second World War in which they had very little industrial capacity — it

was war-oriented — in probably the most dramatic rise in industrial

production, standard of living and wealth production anywhere in the

western world. They did that because they had the cooperative approach.

This

bill perpetuates a set of circumstances which doesn't believe in the

cooperative approach to dealing with the resources of this province. We

give the licence to a private corporation to explore, find and develop

mines, and produce the product called coal. The holder of that licence

is the one that strikes the bargain with Japan, in this instance, with

respect to the sale of that coal. Japan, on the other hand, has this

combined cooperative spirit between government and industry to serve

the interests of Japan. Here in British Columbia the coal companies do

not have that combined cooperative interest. They have the interest of

their balance sheet, and I'm not denigrating that. I'm not saying

that's a bad sort of thing. It's a fact of corporate life — they have

the interest of their balance sheet to serve. I submit that that is one

of the major reasons why we made such a bad deal on northeast coal.

It's one of the major reasons why it's going to cost the taxpayers of

this province somewhere between a billion and a billion and a half

dollars of subsidy over the next 15 years — basically a subsidy to the

Japanese steel industry. We entered negotiations on the basis of a

couple of coal companies having a licence or a lease or whatever, but

with control over the coal in the ground that belongs to the people of

the province, and their foundation was to serve the balance sheet of

those corporations. The government, having granted those

[ Page 9242 ]

licences,

sat back and said: "Well, look, you go to it; that's your business."

That point has been made time and time again by the Minister of

Industry and Small Business Development. We in British Columbia are the

losers because of that kind of policy.

We do not appreciate

that Japan operates on a different basis: they operate to serve the

interests of all Japan, not just a segment of it. In this province we

operate to serve only segments of the population. The segments in this

instance happen to have received licences or leases to look for, mine

and sell coal. That is no foundation upon which to say that this bill

is inappropriate. It's simply a housekeeping bill, as the minister

said. In order to tackle the problem — and it is a serious one.... We

are going to continue to be the losers as long as we carry on doing

things the way we have up until now. It takes much more than just

changing around a few words in

an act and saying that we don't like the

words "assign, transfer, sublet," etc. any more, and replacing them

with some word in the

interpretation — not called "dispose," which says

basically the same thing, or expands on them.

I want to put

the point to the minister that if he is going to embark on this new

profession of his with any hope of accomplishing anything worthwhile

for the province of British Columbia, then I think he should attack the

problem from the foundation that I put to him a while ago: namely, that

if we carry on the way we have been in the issuing of licences, leaving

the holders of those licences to make deals to suit themselves, all of

British Columbia will be the losers, as long as we follow along that

particular course.

I don't know whether the minister has

been in his current office long enough to find his way around in the

ministry and to find out where the components and pieces are, where the

key to the washroom is, and the other things necessary to find out

what's going on within a department. I submit to him that it would be a

tremendous service to this province if he would appreciate what I've

been saying to him and this House, and would tackle it from that point

of view. Set up mechanisms and procedures which serve the interests of

all the people of British Columbia who are basically the owners of the

resource. We in this Legislature, and the government, are only the

custodian of those. As custodians, we and government should not dispose

lightly of those assets and that ownership, simply giving away a

licence and then washing our hands of it, saying: "Well, we have

nothing more to do with what occurs once you have that particular

licence." Our objectives should be much higher and broader than that.

we need a lesson at all in how government, business and labour can

cooperate and work together for the common good of all, we have only to

look to the people on the other side of the Pacific Ocean, in Japan, to

find an example. Not that we can adopt that example here; I'm not

suggesting that. They have an entirely different cultural and familial

base. But we can certainly learn from them as to how they conduct their

affairs to serve the interests of Japan, and adopt the valuable parts

suitable to our structure here in B.C.

MR. LEVI: I

have a question for the minister, which I hope he will answer when he

winds up. For two years we've heard about the development of northeast

coal. When he spoke yesterday, the minister said: "I anticipate that

the members opposite will be supportive of these changes and

progressive reforms in the legislation, and will be anxious to expedite

the passage of Bill 78, the Coal Amendment Act, in order that this

project which is the bright light on the economic horizon in this

province...may continue and flourish, and ensure that the final

arrangements of the project will go forward unimpeded."

What

actually happened? We're now making some changes to the act. There's

been an investment of billions of dollars — a commitment of billions of

dollars, certainly taxpayers' money as well. What happened? Did

somebody find out that the whole thing was actually constructed on such

shaky grounds that the minister has to come in today and ask us to make

some amendments to the act in order to make the deal safe? We've asked

many times on this side of the House, Mr. Speaker, for the reports and

the various commitments that both sides have made in respect to this.

What we have in this bill is a suggestion that the whole thing was

constructed on very shaky legal grounds in the sense that we have to

make some changes. I understand about the recording of leases. But what

happened? Who suddenly discovered that the whole thing could possibly

collapse because it was not set up right in law?

The one

other question I have for the minister is in respect to leases. Does

the government have a philosophy about use-it-or-lose-it, the kind of

thing they have in the forestry act? Also, what's the value of the

transfer of the lease? Has that suddenly become a tremendous asset

which can be traded back and forth? Or once this is vested within this

act, that stays there; you can't trade in these things?

Interjection.

MR. LEVI:

Well, the thing is, we want to be able to understand it. You're not the

minister. We have to deal with the minister behind you — the new

minister.

Just what happens in respect to the leases, and

are they suddenly going to become an asset that can be traded back and

forth? Or when you say that it is in perpetuity, is that the thing?

That's what I'd like the minister to answer.

In the first

part of the question, I asked how they could suddenly realize that they

needed to rearrange the act to make it more secure for what is the

largest single investment, as the government has said many times, in

the province. Has it been set up on such shaky legal grounds that we

need to do this?

HON. MR. SMITH: Mr. Speaker, briefly

dealing with the comments from the member for Skeena (Mr. Howard), it

would seem that we have a very slight philosophical difference between

us on the two sides of the House. The thrust of the member for Skeena

appears to be that the government should be the agency and the body

that negotiates and enters into agreements to develop coal and be the

holder of the licence, and that would promote the best interests of the

province. I hope that I heard the member wrong, but it seemed to me

that it was the usual statist argument that emanates from the other

side. In any event, this government has a commitment to have private

enterprise publicly responsible and, with the checks of legislation,

have private enterprise develop these projects.

My friend

the member for Maillardville-Coquitlam (Mr. Levi), who just spoke,

raised a couple of questions. No, hon. member, the project is not in

any way in doubt or in jeopardy. It's a long-term project, as you know

— a 15-year project. The purpose of these amendments is to ensure that

lenders have the kind of security for their loans that they would have

if they were lending money for the development of land or for

[ Page

9243 ]

the development of petroleum or natural gas. In those areas, there are registration systems and licence systems.

These

leases will not become trading assets to be shifted around, but a

mortgage on a lease can be given to a person who advances the money to

the company which is in charge of the development and holds that lease.

It's the security of the mortgage that we're talking about. We're not

talking about trading around the asset, or selling the asset. We're

talking about giving security to lenders who will be advancing the

money to the coal companies and will allow this great project to

proceed.

Motion approved.

Bill 78, Coal Amendment

Act, 1982, read a second time and referred to a Committee of the Whole

House for consideration at the next sitting of the House after today.

HON. MR. GARDOM: Second reading of Bill 79, Mr. Speaker.

HOMEOWNER INTEREST ASSISTANCE ACT

HON. MR. BRUMMET:

Mr. Speaker, in moving second reading of Bill 79, the Homeowner

Interest Assistance Act, I would like make a few brief comments of

explanation regarding the bill, and then look for the support of all

members of this House. Bill 79 provides the legislation necessary to

implement the new B.C. home program. It provides the authority for

homeowners to be reimbursed for a portion of interest charges on their

mortgage payments on their principal residence. The reimbursement will

be in the form of a loan repayable on the sale of the home, or as

prescribed in regulations. This loan aspect is a new, responsible and

very positive feature of this program. It provides a hand to people who

need it, not a government handout. In effect, those who benefit from

the program will be the ones who will pay back the assistance they get

when times get better. There will not be a long-term burden on other

taxpayers. It would certainly require a very negative outlook to assume

that the economy will not have improved long before September 1985, or

that interest rates will not have gone down to a reasonable level by

that time.

[Mr. Strachan in the chair.]

I'd like

to inform the members of this House, Mr. Speaker, that in preparing the

plan we met with representatives of the financial community and we got

very valuable input from them as to what would work, what would not

work, what can be done and what can't be done. We are not upsetting the

existing mortgage structure in implementing this plan. What we are

doing is providing assistance direct into the hands of the homeowners.

We did get the support of the financial community and their valuable

input.

Since the program was announced and briefly

described, we have had a great deal of interest. The phones in our

offices and many offices have been ringing steadily. The public is very

interested. We have had a great deal of support from people in the

financial community and from many other people in our province.

The program would work basically as follows. The government would

provide interest relief to all existing and new or renewed mortgages,

effective as of October 1, 1982, and until September 30, 1985. That

relief will come on the first $60,000 of any homeowner's mortgage plan

on their principal residence. It will bring the effective interest rate

down to the 12 percent level, up to a maximum of six points. Perhaps a

brief example might help. If a person in the next three years, or last

month for that matter, renewed a mortgage at, say, the 18 percent

level, through this plan we would bring their payments down to an

effective 12 percent level. If their mortgage rate is higher than the

18 percent, we have to put a top limit on it. With interest rates

actually coming down, we assume that the 6 percent margin will

definitely cover the program. As I indicated, the interest assistance

program will apply to all homeowners — all those who hold mortgages,

including chattel mortgages on mobile homes. The $60,000 is a maximum,

and there is no minimum. If we look at what help it provides, it is

universal, so it will provide this assistance to anyone with any size

mortgage, but only up to $60,000. However, the low-mortgage holder —

someone with a $20,000 or $30,000 mortgage — in percentage terms, of

course, will benefit at the highest level.

We estimate that of the more than 405,000

principal homeowners in British Columbia, perhaps 350,000 will take

advantage of this assistance program. We know there are some long-term

mortgages that are below the 12 percent rate, and naturally this

program will be of no benefit to those people. lf they come up for

renewal they may apply at any time during the program, but all payments

will cease in 1985. We are naturally assuming — and I think it is a

very reasonable assumption — that the economy will have improved by

that time. I think it is reasonable to assume that the interest rates

will then have come down to a reasonable level. So in September 1985,

when people renew their mortgages, their payments may well be down to

the 12 percent level anyway, and they will not be going up.

the event of the worst scenario, which many people seem to prefer, we

are allowing people an extra year of interest-free grace to make the

adjustments if they do have to raise their payments at that time. We

are allowing a flexible repayment program, in that it may be to their

benefit at that time to roll it into their existing mortgage to repay

it. It may be to their benefit to pay it off in a lump sum. It may be

to their benefit to spread the payments, which of course are interest

free in that fourth year, as well as in the three years when they are

accumulating the assistance on the loan. If they so choose. they may

spread it out over the 12 months, because they're not paying interest

on it. After September 30, 1986, we will further assist people who

can't roll it into the program by working out a mortgage repayment

scheme, which we can handle ourselves.

What the program

provides is security for homeowners for the next three years. They know

their monthly mortgage payments will be at the 12 percent level. We

have every reason to believe they will improve after that time, and so

will their own situations. It provides the type of security that we

believe will create consumer confidence in the housing industry. That

consumer confidence will of course allow people to buy homes, to remain

in their homes, and in that sense will probably encourage, to a

considerable degree, the acquisition of new homes. When some people are

acquiring new homes then we need other homes, and when we need other

homes that of course stimulates the house building industry.

also feel that this imaginative program will stimulate the economy. By

leaving more money in the hands of homeowners, more will be spent in

the rest of the economy, and

[ Page 9244 ]

that

will stimulate activity in the business community, creating some

indirect jobs. The direct jobs we look for in the housing industry and

associated trades; the indirect jobs we look for from the money going

into the economy because people spend. If people choose to save or

invest that money, we feel that too can stimulate the economy, because

it provides investment funds which are available to the rest of the

people in our economy. That in turn will indirectly create other jobs.

So whether they spend this money during the three years, or whether

they save it, it will certainly stimulate the economy.

Some

people have questioned how this is a benefit if in fact it is a loan

that must be paid back. I would suggest that anyone in our society can

tell you that when you get interest-free money into your hands for four

years, it is a benefit to anyone at any level; in other words, anyone

can benefit. We are of course, in keeping with our philosophy, allowing

freedom of choice here. It's up to people whether they want to get in

on the plan.

Perhaps I could use another example: if someone

right now is locked in for the next few years to a 13 or 14 percent

mortgage, is comfortable with those payments and does not want to

receive these benefits, thereby incurring the loan or the debt, that

person doesn't need to get into the program. It's their choice. I'm

sure the money the people get will be used in many and imaginative

ways. We do not apologize for that. We considered whether people might

take fair or unfair advantage of the program, and we don't see how they

can take unfair advantage. We want to help people, and we want them to

stimulate the economy. Whatever way people use this money, we feel that

is going to happen.

I suppose we should make a brief

reference to how it will be funded and the costs. The Ministry of

Finance will handle the program through the normal capital funding

sources and, of course, supplement it by the recently approved housing

and development bonds. What we're doing, in effect, is using the top

credit rating of this province, carefully and deliberately established,

to help our people get a benefit which might not otherwise be available

to them.

Some people have tended to criticize the program by

asking why we are borrowing money to put into this program when there

are restraint measures in other areas. We're trying to help people

through this difficult period and, in fact, help them to help

themselves. I think we have to remember that the imaginative and

different part of this program is that the money will be recoverable.

When they are better off, we will be getting the money back. So it is

not money that is just handed out, spent and which will not be

recovered.

We're estimating that perhaps in the first year

the money put out to homeowners will be up to $300 million. It's

estimated that anywhere from $860 million to $1.4 billion will be put

out in this assistance program, depending on what the interest rates

are, say, a year or two down the road and on how many people apply. You

also have to remember, as I indicated earlier, that that money will go

into the economy in one form or another.

The only costs that

will really be incurred by government are what that money might cost if

we don't recover and the interest that might be forgone if the money

had been used in other ways. I feel that with the stimulation that this

puts into the economy, which will generate more revenue to the

government, and with the savings that it will create from other

assistance programs the government might have to provide if this

program were not in effect, we will recover all of those administration

and actual costs of the program.

I conclude by saying that

this program is to provide security and consumer confidence. It will

stimulate the economy in various ways. The program will be creating

jobs directly. It will also be creating jobs indirectly through the

stimulation it will provide to business and industry. The program will

work. Those who benefit will be paying it back, so we're simply using

the credit of the province to help them through these difficult times.

There is a great deal of interest out there. It is not going to place

any long-term burden on the taxpayers of this province. It appears that

the program is getting very enthusiastic acceptance.

hope, with your cooperation, that we can pass this legislation and put

it into effect. The application forms and particulars are being

prepared now.

Incidentally, I might add that with the

cooperation of the existing mortgage lenders and our ministry staff

we're working out a program so it will be worked through the existing

structure. We will not need a large bureaucracy to run this program.

The lending institutions have agreed to waive any application fee

costs. We are not charging any application fees, and members will see

from the bill that we're providing the structure of government to avoid

any extra costs associated with this. With the way we have designed the

program we can avoid restructuring mortgages — the legal costs and so

on that are incurred. I'm sure questions will come out in that respect

in committee. I move second reading of this bill.

MR. GABELMANN:

Before beginning debate on the bill, I'd like to express my

congratulations publicly, as I have privately, to the new minister in

his new role as Minister of Lands, Parks and Housing. Since this is his

first opportunity to perform in the Legislature in his new role, I

thought it would be appropriate for me to say: congratulations to you.

While I don't wish you a long term, may it be productive in the short

while.

We're going to vote for the bill, Mr. Speaker. Now

that I no longer have to deal with the new Provincial Secretary (Hon.

Mr. Chabot) in this job, we're going to try to turn over some new

leaves.

There are a number of things I want to do in

responding to the legislation. I want to talk a little bit about the

history of housing over the last six years and some concerns we have

about the inaction of the government. I also want to express some

concerns that we have about the impact of the legislation. I'll do that

a bit later on.

I wish we had been debating this bill all

this week. I think the minister wanted to do the same thing. It seems

to me that we were called back on Monday of this week to deal with

economic recovery programs. So far we've spent the whole week wasting

our time dealing with the gerrymander. This bill is one step, one

aspect, of what should be a legislative program for economic recovery.

I'm pleased that we're now able to debate this bill. I'm sorry and

distressed that it's not part of a bigger package of legislative

proposals and government action that we could debate to find a way to

get British Columbia out of its current difficulties. Nonetheless, this

is at least something that we can grasp at.

The timing of

the bill is curious. In six years or so of Social Credit government

we've had announcements virtually every two weeks, saying there would

be a housing program announced shortly. After six years of two-week

programs we've finally got an element of a housing program.

[ Page 9245 ]

I'm

distressed that at the time when the housing crisis was greatest — not

that it isn't difficult now; it is — and when mortgage rates were at 21

percent, 22 percent and higher, and the cost of buying houses escalated

far beyond any reason, we had no programs. Now that interest rates are

coming down — and, hopefully, this is the beginning of a long trend of

decline in interest rates, not just an aberration — and housing prices

have come down and the crisis is less acute, we have government action

of a sort. I wonder why that is. I wonder if it might not have

something to do with the fact that we're very likely to be into an

election soon. I wonder if this isn't more related to election recovery

than economic recovery. I wonder if it isn't much more related to

buying votes, as opposed to assisting people in their individual

housing crises. Nevertheless, even if it is simply a political gesture

for political recovery, if it benefits only one British Columbian I'm

going to support the bill, even in this time.

I said I had

some concerns — I'm not going to be long about this. I wonder why we

hear this beautiful new phrase, "off-budget money," floating around,

which in effect creates deficit financing while not really

acknowledging that it's going on. But we're able to find that kind of

off-budget money for programs that assist a great many people.

Unfortunately, it will probably assist people who are in our economic

income bracket who shouldn't really need the kind of assistance that

this provides. Nevertheless, it's there. Why can we find this cutely

termed off-budget money for these kinds of programs when, at the same

time, the government has to announce that the mentally and physically

disabled are having their rental sharing programs cut back? I wonder

why it is that people who are in great need, such as mentally and

physically handicapped people in British Columbia — there are many

others, but I cite this as one example — have had their subsidy, which

is what it has been, cut back by the provincial government. Last year

there were grants available for rental units for mentally and

physically handicapped persons. This year there are 100.

think there is some inconsistency in what the government is doing. I

could cite — but I won't, because I don't intend to take long — dozens

and dozens of other examples of where government cutbacks for needy

people, whether they're mentally and physically disabled, whether

they're senior citizens, whether they're people in need of social

housing, whether they're people who are waiting on the B.C. Housing

Management Commission lists.... There are a minimum of 10,000 at any

one time on those lists, and many more would be there if they had any

hope of getting accommodation through those processes. I wonder why it

is that when no money is available for those needy people we're able to

find money for a program like this. I wonder again, Mr. Speaker, if the

answer isn't that this is more political than it is economic, that it's

more political than it is designed to help those people who most need

help.

I have some concerns about those tens of

thousands of British Columbians who rent. There's no assistance in this

bill for them. If rent controls had been maintained in the most part,

then they may well have been protected and could avoid the necessity of

falling under the umbrella of a program like this. But we haven't had

rent controls. They've been virtually abolished. As a result of that,

renters in many cases — and in most cases renters are lower-income

people — have had exorbitant increases even with the levelling off.

Even with the vacancy rates increasing lately, as they have, and the

deals that you can get, such as the twelfth month free, the trip to

Reno if you rent a suite and those kinds of things, rents haven't

really decreased. There's no assistance for those people. They are

legion in this province. I make the point that in most cases people who

are renting do so for economic reasons. They have a lower income and

don't have the money to get into the housing market.

This

program doesn't help them get into the housing market. This is not a

program that is designed to help relatively low-income people obtain

their first home. The program still requires that you qualify for a

mortgage at the regular rate. You can't go to the bank and say: "Okay,

your rate is 16 3/4. This program will bring it down to 12. I qualify

at 12, but I don't at 16 3/4. Therefore I should get a house." The bank

will say: "No, you don't qualify, because your income isn't

sufficient." I don't blame the bank, because three years down the road

the program ends. Four years down the road, the money is over, and the

bank is then faced with having a mortgage-holder with an income

insufficient to meet the demands of what could possibly be still a 16

3/4 mortgage. Who knows? It doesn't address the needs of those people

who would like to get their own first home, who don't meet the

eligibility requirements. In that sense, too, Mr. Speaker, I have some

concerns about the focus and the thrust of the program.

have some concerns about those people who took out mortgages a year or

a year and a half ago at 22 and 23 percent and who will find that this

program benefits them by only 6 percent and that their mortgage will

come down to 16 or 17 percent. The ex-Minister of Housing interjects

that it is short term, and that's true. Many of these mortgages were

taken out on a short-term basis, but they are still in place and they

still mean that people this fall are losing their homes and having to

get out. We've all had calls expressing some interest in this program

by people asking what it's about. I've had calls from people who

realize it's of no benefit to them because it doesn't bring their

mortgage down to a level where they can meet the payments for the next

six or ten months. There are a number of people in that particular

category.

I said earlier that it's a sneaky way of deficit

financing. I just wish the government would own up to the fact that

through a number of its economic programs it is, in effect, running a

deficit this year. The last

section of the bill — the appropriation

section — says that money for the program comes out of consolidated

revenue until the end of the fiscal year. That's money that will have

to be borrowed. I don't have any objections to that, but I do object to

the apparent coverup, or the attempt to deny that in fact the

government is borrowing money to implement this kind of program. Why

don't we just face up to the fact that this is what we're doing?

wonder — I'm coming close to the end of my remarks — about

section

2(f). We'll have an opportunity in committee sometime in the near

future to discuss in detail what

section 2(

f) means. I'm not a lawyer

and I don't have any great expertise in these matters. The

section says

that the government can make regulations "defining, enlarging, or

restricting words and expressions that are used in this act." In the

words of the act, the government can define, enlarge, or restrict words

and expressions. I assume that means words and phrases. The term

"expressions" is a strange one, but that doesn't matter.

Isn't

this a new form of legislative behaviour? We're being asked to pass a

bill that can later be amended by cabinet — in the secrecy of cabinet.

Whether or not that has any negative impact on the program is in a

sense irrelevant at this

[ Page 9246 ]

point.

The fact is that this is, in my judgment, a dangerous legislative

precedent. In fact, I question its legality. I question whether the

cabinet can in fact alter or restrict something that the Legislature

has passed. Even if the Legislature passes a clause that says you can

do it, I wonder if that's legal. Outside the concerns of the housing

question involved in this issue, I'm concerned about the legal and

legislative precedent established in that section.

The other

thing I wonder is whether we even need a bill to do this. I suspect

that the government could do as it did with HIP a couple of years ago,

when they arranged for 9 3/4 percent mortgages for people up to a limit

of $200 million. They had a limit of $90,000 on the price of a house,

and those kinds of things. They did all that without legislative

approval. I wonder if this couldn't be done without legislative

approval as well. The non-specific, non-precise way in which the bill

is written seems to have more to do with politics than with legislative

authority. It has more to do with politics than really with anything

else.

I don't have much more to say. As I said initially,

we're going to support the bill; any port in a storm. I wish we'd seen

a few ports when the storm was at force 10, but now that it's

diminishing, we....

AN HON. MEMBER: An election is coming.

MR. GABELMANN: Yes, an election is coming, as my colleague points out, and we now see some belated action.

AN HON. MEMBER: Too little too late.

MR. GABELMANN:

It's not too little too late for some people. In some cases it benefits

those who don't need to benefit. I'm sure most members of this

Legislature, together with a lot of other people in the community, said

to themselves upon the announcement of this program: "How do I qualify?

What does it do to my monthly payments?" I must confess, I went through

that process myself. I thought about that. I don't get the $10,000, but

I get a bit of free money for four years. Do you know what I'd do with

it? I'd probably spend it, and I'd owe it all at the end. So I'm

probably going to say to myself: "No, it's not a good idea for me." But

how many more are going to do that? How many people are going to say:

"We really do need a new fridge. We really do need a new couch, and we

really do need a new car. These several hundred dollars a month will

help us to make those payments now." Then saying to themselves, "Four

years from now we don't know what things are going to be like, and

we'll let four years from now look after itself," they'll then find

themselves in some difficulties four years from now. I have some of the

same objections in that sense as I did to I think it was the Commerce

bank when they did the "red convertible loan," the attempt to persuade

people to borrow money often needlessly. I wonder if this program won't

encourage people to take advantage of free money, not needlessly, but

without sufficient concern about what the impact might be four years

down the road. Other people will be participating in the debate,

obviously, but when he concludes the debate I wonder if the minister

would give me some of his rationale about why he thinks that the

program should be universal in this respect and not specific to those

people who need assistance, to those people who have had their rental

subsidies cut back, as I cited earlier, in the case of the mentally and

physically disabled. Why not some assistance for the needy, instead of

assistance for some of us who might be greedy?

MR. RITCHIE:

I am indeed delighted to take my place and make my comments in respect

to this very welcome bill. Before getting on, I would like to

congratulate our minister in bringing in such an innovative, exciting

and long-overdue approach to helping those who wish to own their home,

whether it be mobile or otherwise.

Listening to the comments

of the member for North Island, I can only hope that his endorsement of

this bill may be a little sign that he is now changing his attitude

towards ownership, from that of state ownership to private ownership.

The member talked very briefly about where the money will come from

from — suddenly we find money to bring in a program like this. I would

like to go on record as saying that as long as this government

continues its attack on waste in government, there will be ample funds

available. And I speak of governments throughout this land. I am not

hiding the fact that there are areas in government where we can save.

It's no secret; we are onto it throughout the whole system.

Then

he complained about how difficult it will be for the first home owner

under this system. In my opinion, the first thing in desiring to own a

home is in the attitude, not dollars. I believe that anyone, whether

it's the first, second or third home, if they have that positive

attitude and they wish to own a home, or own a bigger or a better home,

then they will be able to do so as long as there is funding available

that they can borrow to use while they are going through that process

of achieving their goals — not the way the socialist party would do it,

by merely handing out dollars. That is accepted at the time, but the

appreciation isn't there as it should be.

The only

opposition that I have heard to this bill so far has been that it's

okay, but the money must be paid back. Well, so what? If the dollars

handed out over the years in various areas — housing, etc. — were put

out in this form and handed back, we wouldn't be in such difficulties

in Canada today. The reason why such a large percentage of our tax

dollars is being used to pay the cost of borrowed money is that it was

handed out under that socialist philosophy that we're seeing. That's

where I say that we have now reached a point where we must change our

attitude towards that and adopt ideas such as this, that this minister

has brought in this House today. The program, as introduced, does not

discriminate at all. It's not restricted to those who want to buy a

first home. It's available to all people, whether they own a mobile

home or otherwise, as long as they have a mortgage that qualifies. It's

an excellent bill and program that's fair to everyone interested in

having their own home.

The program is not a handout for the

sake of just filling a gap, as the party on the opposite side would see

it. It's a program that is going to bring these people who are faced

with high mortgage rates through a difficult time. It's going to make

it very easy for them not only to acquire but to retain their homes

through this difficult time of high interest rates. It's not designed

as if it would be by the opposition party's desires; it's not designed

to create another problem in the future, as would a handout program.

With that we would have the generations to follow having to pay off the

expenses of a program that we put into place today to help those in

need today. The program is designed to help them today, but to return

the money tomorrow when things have improved and when conditions are

better so that those same dollars will be available should the need

arise again for those who follow

[ Page 9247 ]

who

wish to own their own home. The program says: "Take it and use it, but

use it wisely, because we expect to have it paid back so we may help

others in the future."

The plan is innovative, because not

only does it help the homeowner, but it will stimulate the economy and

increase employment in the workplace. It's going to prove that dollars

in the hands of the private sector are much more productive than they

are with government. I believe that the longer we can leave the money

out there in the private sector, the more productive it will be, and

the greater the benefits will be to the province and to all the people.

I'd

like to go through some figures I have discovered concerning the

benefits this could have on the employment situation in our province.

HUDAC estimates of job creation through housing construction show that

in Canada in 1982 one housing unit generates more than two man-years of

employment for the construction industry, in addition to the multiplier

effect on the whole economy. More specifically, they estimate that the

construction of 32,000 housing units would generate 71,000 man-years of

employment. That's very substantial. This 71,000 man-years of

employment can be broken down as follows: direct jobs, 22,000; industry

jobs, 18,600; and trade and manufacturing spinoff jobs in the economy,

30,400.

They go on to say: "Employment in man-years was

generated through single detached housing in Canada during the years

1969 to 1974. Figures have not changed significantly, but onsite

construction" — this is a breakdown of the jobs — "totals 622 jobs;

offsite, 138; manufacturing, 252; trade and transportation, 154; and

primary and semi-finished goods, 101."

The impact of this

program on the overall economy is going to affect such things as

sawmills, veneer and plywood mills, sash-and-door and planing mills;

metal fabricating, ornamental and architectural metal, metal stamping,

pressing and coating heating metal, and miscellaneous industries such

as bathroom fixtures, non-metallic mineral production, ready mix

concrete, clay products, drywall, gypsum board, insulation and fire

break. They all benefit from a program of this nature.

can go on further and talk about the consumer-oriented industries, such

as food and beverages, clothing, printing and publishing, and how

they're affected by the type of program where a government makes money

available for housing construction and house ownership. It's going to

stimulate such things as the food and beverage industry. That has an

impact on employment in manufacturing industries, using a $10 million

expenditure on residential construction.... These figures are, for

1976, in personyears: food and beverage, 12.6; rubber and plastics,

4.4; textiles, 5.3; clothing, 6.4; wood, 25.9; paper, etc., 5.9;

printing and publishing, 5.7; primary metals, 7.6; and it goes on and

on. What it really tells us is that when a government uses a program of

this nature, where they say, "Use this money, buy yourself a house,

stimulate the construction industry," all these things benefit from it.

It's

an exciting program. It's an innovative program. It's not only going to

help the home buyer today; it's going to help all of us. The money will

be returned three or four years from now to help generations that will

follow. I support this bill wholeheartedly.

MR. STUPICH:

Mr. Speaker, may I start by congratulating you on being appointed

Deputy Speaker. I have spoken earlier in this session but you were not

in the chair then, and I didn't have an opportunity, so I thought I

would do it now.

May I also congratulate the new Minister of

Lands, Parks and Housing. During all the years, some six years, as the

member for North Island (Mr. Gabelmann) pointed out, that the previous

minister was there and regularly announced housing programs, apparently

the Premier never thought to take him into his confidence. He never had

a program to announce. Yet within a few short weeks of taking over the

portfolio, the new minister has a program to announce. I was also

impressed with the way in which the minister listened to what I'm sure

he would say, and certainly what I would say, was a searching analysis

of the legislation and the program by the member for North Island. I

thought that the minister paid him a good deal of attention and

listened. I'm sure he's not going to agree with everything that was

said, but I would be surprised if he didn't comment on some of the

points made.

I think this is also to his credit: I noticed

that he did not pay very much attention to the fawning bootlicking

exhibited by the hon. member for Central Fraser Valley (Mr. Ritchie);

there wasn't anything to listen to. I noted that, and that's to his

credit.

DEPUTY SPEAKER: Hon. member, please. We must maintain parliamentary decorum.

MR. STUPICH: I thought I was, but I'll leave it to you to remind me if the need arises.

One

concern expressed by the member for North Island was that people who

don't need help will also get help from this program. I too have some

of those concerns. I believe some of the columnists suggested that

people who do not now have mortgages might go out and mortgage their

houses and use the money for some investment plan. I don't know whether

the regulations will prohibit that sort of thing from happening. I have

some concern that some people who don't now own residences — perhaps

they're renting apartments, as I am — might decide that this would be a

good opportunity to go out and buy a residence, knowing that the

interest on at least the first $60,000 is going to be subsidized down

to 12 percent, and gambling, as the minister indicated, that in some

three to four years when it comes time for me to pay that money back,

conditions will have improved, interest rates will have dropped, and

they will then be able to drop that piece of property on the market and

pick up a nice, tidy bundle of profit. Perhaps that could happen;

perhaps the minister is not concerned about that happening, but I have

some concern about the abuses that may enter into this.

Again,

I haven't seen the regulations and am not sure what they are, but it

seems to me that that's one possible abuse. Somebody might go out and

buy a house, with a view to getting cheap financing for some three to

four years, in the hope that the property will increase in value in

that period and that they'll then be able to make a tidy sum at public

expense. Whatever is said about it being a loan, there is a cost to the

public for this program; the minister admitted that in his remarks. It

is interest-free money for four years. Certainly the public purse is

paying part of the cost of this. Some individuals may take advantage of

it unless there are sufficient safeguards.

There are people

who do need help. The good part of the program is that some of them are

going to get help. I'm concerned about some of the suggestions made

about what people might do with the money they get. For example, I'm

[ Page 9248 ]

concerned

that right now the government is bargaining with government employees.

They are being persuaded to take no increase, or a very nominal

increase, in their take-home pay. One of the things that might

encourage some of them to do this is the knowledge that they're at

least going to get some help with their mortgage payments for a three-

to four-year period. So it will be easier for them to get by, getting

less of an increase in pay at this particular time, knowing that

they're going to get help from the government if they have a mortgage

on their home, help from the government to meet their living expenses

today, and hoping, along with the minister, that when the day of

reckoning comes, interest rates will have dropped. If interest rates

haven't dropped — and there's always that possibility — then those

people who decided that they can get along with less income today in

the knowledge that the government is going to subsidize their living

for some three to four years are going to have a lot of trouble when

that day of reckoning comes. I do have that concern. Not just

government employees, but desperate people who are not getting by now —

who are surviving but are not really getting by on their incomes — are

going to use this interest-free loan that's arriving once a month

simply to live on.

When the day of reckoning comes, they'll

find it very difficult to finance a larger mortgage or combination of

mortgages, because the minister has said that in the event they are not

able to pay it off, in the event that they can't add it on to their

existing mortgage, then — and I believe this is what he said — the

government itself will loan them the funds necessary to repay the money

that was loaned to them interest-free. So I have that worry. A lot of

people who are going to enter the program, take advantage of it, and

who need the money for living right now, will find themselves in a

pretty desperate situation in some three to four years — unless, as the

minister hopes, and as we all hope, interest rates do drop

significantly.

People will receive help — and this applies

to everybody only in the event that interest rates stay up. Now the

minister might say that if interest rates drop down to 12 percent, they

don't need help, so it's no problem. But in offering what has been

described as an election bribe at this time, the minister.... Mr.

Speaker, the minister raised his eyebrows. He was not the one who

described it as an election bribe. I don't think he'll deny that it is,

in part. Nevertheless, in offering this election bribe at this time,

remember that people are going to get contributions, interest-free

loans, only if there is that difference between their mortgage rate and

the 12 percent figure. If their mortgage rate drops, then they don't

get any money. So it may be a very short-term thing, because the

minister has expressed his confidence over and over that interest rates

are going to drop. So in saying that he's going to give people

interest-free grants, once a month for three years, he's hoping that he

will not have to continue that any longer than a year. I certainly hope

that happens as well. We all hope that interest rates drop and that it

will not be necessary to subsidize payments down to the 12 percent

figure. It might not happen.

If the interest rates do

stay up high for three years, then the people who are getting this

interest-free money from the government are going to do quite well,

thank you, from the government. Then they'll benefit again if, after

the end of that three-year period, and before the time of renewing

their mortgage — or, say, after three years and 11 months.... They'll

get the maximum benefit if interest rates stay up to at least 18

percent for three years and 11 months, and then drop down to 12 percent

at the end of the fourth year. That's the ideal situation from the

point of view of the person who is getting this interest-free handout

from the government. It's a pretty ideal situation, and I doubt very

much that that is going to happen.

One of two things is

going to happen. Either interest rates are going to stay up and people

are going to get all kinds of money, and at the end of the fourth year,

they'll still be high and they'll be faced with a very difficult job of

refinancing their entire mortgage or a combination of mortgages, or

interest rates are going to start dropping in the interim as they have

already, and people will not be getting nearly as much of this

interest-free money as they see in their eyes now when they look at

this program. They see the figures now and they think that for three

years they're going to be getting all that money. It just might not

happen that way.

The minister said that we had to have a

cutoff somewhere. Interest rates might not drop. Interest rates might

go even higher than 18 percent. So to protect the government, the

government had to have a cutoff figure. Mr. Speaker, what about the

people who need help? Surely the government is interested primarily in

those who really need this kind of help to meet their current

high-interest mortgages. In the event that interest rates do exceed 18

percent, they are going to be even more desperate. Their need is going

to be even greater. If the minister and the government are so convinced

in their minds that interest rates are going to drop rather than go up,

then why not gamble a little bit on the fact that they might indeed go

up? Why not offer that kind of psychological protection now to the

people who are entering into this program? Why not say: "Look, this

program is designed to help you. It will bring your interest rates down

to an effective 12 percent regardless of what happens to mortgage

interest rates"? Why put that 18 percent limit in there when that's

really cutting off the people who are going to need the help most

desperately? I would urge the minister to consider dropping that upper

limit on it.

The minister said that there's widespread

interest. That in itself would tell him that there is need for this

program. Certainly some of the interest must be coming from people who

are wondering if they can take some advantage of it, who don't really

need the help. But there are a lot of people out there who need the

help. Even though the minister's predecessor in that office kept

telling us, time after time, that not many people were having their

homes foreclosed, nevertheless we know this is happening and that

others are hanging on tooth and nail, hoping for some assistance and

hoping that something is going to turn around. Yet a lot of them must

be getting near the point of losing their homes.

The

minister said that the people getting these interest-free loans will be

spending the money in the community. That is good. Certainly what we

need is some economic activity in the province. Certainly what small

business needs is for people around the province to have more money to

spend. That can't help but be a positive effect. The individuals

getting it, worrying about paying it back in four years, may be hurt

down the road. But the total effect of putting more money out into the

community, however it is done, is bound to have a good effect and to

help the economy of the province.

The member for North

Island raised the question about those people who can't qualify for a

mortgage in the first place. This helps people who need help, it helps

people who don't need help, but it doesn't help some people who need

help and don't have the financial resources or income levels

[ Page 9249 ]

that

would qualify them for the mortgage in the first place. There's nothing

in this program to help those people who are just below the limit of

qualifying.

I don't know whether the mortgages are

controlled in any way: that is, that they have to be with some

independent third party — through banks, trust companies or some such

organization. Does it allow for private mortgages? Because there are a

lot of private mortgages out there. There could be a lot more under

this program. It's quite conceivable that some people might enter into

arrangements at relatively high interest rates, even though the market

rate is dropping, and get funding from private sources at high interest

rates, get the government to help meet that differential and pocket the

difference between them. This is one of the abuses that just might

happen. I don't know.

We're dealing with the problem not

just of homeownership, but of accommodation in total. The member for

North Island raised the question about those who simply can't qualify

for a mortgage. He also raised the problem of those who are paying more

rent than they can afford to pay. Unfortunately, we're not dealing, in

this legislation.... Perhaps I'm going beyond the bounds of this

legislation. I urge the minister to give some consideration not just to

the problem of home ownership. We have to go beyond that, and think

about accommodation in total, and come up with some kind of program —

at taxpayers' expense, because this is certainly at taxpayers' expense

— that will help not only those who want to acquire a home of their

own, but those who are renting.

A lot of people are renting

in this province. Some choose and some don't have the choice. A lot of

those people who are renting are paying much too high a proportion of

their income for their rental accommodation. I urge the minister to

consider that problem, perhaps not today, but in future legislation.

started by making some reference to electioneering. I think, even in

the figure of three years' interest-free loan with four years to pay it

back.... Do those figures mean anything to you, Mr. Speaker? Elections

normally come in the province somewhere between the third and fourth

year. Aren't we saying to some of these people: "Come and get this

interest-free money — on the eve of the next election campaign. If

things are really tough we'll come up with a new program to help you in

the event that you vote us back into office again." It seems to me that

it's a rather cynical approach to the whole thing. It does leave the

door open to the minister and government being accused of a cynical

approach to electioneering in bringing this in now when the need is not

nearly as great as it has been in periods over the last six years. But

there is the new need for the government of the day to have some

program to take to the people of the province.

The member

for North Island did say that as long as it helps one person in the

province, then the legislation has to be supported. People who don't

need it are going to get help; that's unfortunate. People who need it,

but can't qualify, are not going to get help; that is unfortunate. But

there are a lot of people out there in the community who are hurting

and need help. They are going to get at least some temporary assistance

from this program.

[Mr. Speaker in the chair.]

I'm

at the point of winding up, but now that the Speaker himself has

resumed his chair, it's my first opportunity to address him in that

position. I was going to say: "Congratulations." I was told some time

ago that congratulations are something you offer to someone who has won

something; you offer best wishes to someone when you're really hoping

the best for him, in spite of the fact that he got a job that he wasn't

actively seeking. Mr. Speaker, I wish you best wishes. From the

beginning of the session, particularly the first day, I thought I

should have done that even earlier. I sincerely do wish you best wishes

in that position. I naturally wish you a short tenure in office, but

while you are there I do offer my best wishes.

With respect

to the program, any program at all that helps people who are needy we

will support. It's not the program we would have brought in. We would

have preferred that the program did not help the people who don't need

help. We would have preferred that it offered more help to those who

need it. We would have preferred that it offered help to those who

can't qualify for mortgages. We would have preferred that it offered

assistance to those who are paying a higher proportion of their income

in rent than they can really afford to pay. But it's something, and

because it is something, because it will help some people, I join with

the member for North Island in saying that we will support it.

HON. MR. CHABOT:

I too haven't had the opportunity of congratulating you on your

election to the speakership of this Legislature. However, I am pleased

to see you there and I'm sure you will do a good job.

The

member for Nanaimo, who just took his seat, was talking about the

length of this particular mortgage-interest relief program. He talked

about it being three to four years — three years with a fourth

repayment-privilege

schedule — and was a bit cynical about that

particular time-frame, suggesting that it had something to do with

politics, that elections were held in British Columbia every three to

four years. I am sure he recognizes that we're in a period of

short-term mortgages in British Columbia at this time. A mortgage of

one year is deemed to be a long-term mortgage today.

Interjection.

HON. MR. CHABOT:

Well, in this day and age it's very difficult to get a mortgage that is

beyond one year, unless you're prepared to pay a substantial premium.

What we are essentially doing by this legislation is creating some

stability over a relatively lengthy period of time for those homeowners

who need relief. I don't know whether that member for Nanaimo is

suggesting that that mortgage relief program should be for one year,

two years or what. We've picked three years as being an appropriate

time to offer this relief. I'm glad to see the mortgage relief program

here. I worked for some time on a mortgage relief program, and I'm glad

to see that the new minister was able to introduce it, roughly about

two weeks after he came into office — two weeks being a significant

time-frame.

MR. COCKE: So you're taking the credit.

HON. MR. CHABOT:

No, I'm not taking the credit. I didn't put the program in. But it's a

continuation of some work that was started some time ago.

The

member for North Island talks about no programs, that there were no

initiatives and no desire for people to build housing in British

Columbia. The year that this little minister

[ Page 9250 ]

was

in charge of housing in British Columbia.... There were more housing

starts in 1981 than ever before in the history of this province —

41,585 homes were built in British Columbia in 1981. Between 25 and 30

percent of all the housing starts in Canada were right here in British

Columbia. And you suggest that we didn't have the policies to encourage

people to build homes in British Columbia? You're talking through your

hat when you suggest that.

The member for North Island also

talks about the fact that we didn't build any handicapped housing in

British Columbia. Last year was a banner year. Last year there were 200

units of housing put in place for those people, for mentally and

physically disabled people in this province, four times the number ever

put in place in previous years. We have a history in British Columbia

of providing about 50 units of housing per year for handicapped people.

Last year, under this little minister, when he was in Lands, Parks and

Housing, there were 200 units of housing put in place for the

handicapped. You suggest nothing was done?

I'm sure members

of the opposition have had an opportunity to review some of the

policies. I put it in a small booklet form so that they could apprise

themselves of the various programs there were in place that would help

people get into their own homes or acquire land for housing in British

Columbia. Another major step that was taken just a year ago was the

increasing of the second mortgage from $5,000 to $10,000 for people who

have not had any help before from that program. We effectively reduced

the interest rate from 21 percent to 15 percent for the second

mortgages, making the second-mortgages program in British Columbia the

lowest-interest second mortgage in Canada. No other province has a

program that is more responsible as far as interest rates on second

mortgages are concerned than here in British Columbia.

British

Columbia has always been a province where there's strong support for

home ownership. Roughly 60 percent of British Columbians own their own

homes. This B.C. home program will give people a three-year breathing

space. It's available to all homeowners in British Columbia, and

rightfully so. Any program that is brought in by government should not

discriminate against any particular segment of society. This program

allows the 350,000 homeowners in British Columbia to qualify and

participate and will be of immense help to them. It will help those who

have been concerned about high interest rates. There are some people in

this province who have felt compelled to list their homes for sale

because of the fear of what the interest rates would be at the time of

renewal of their mortgages. Some have listed their homes, and the homes

are not selling. Needless to say, there's some fear and apprehension

among that group of citizens in this province. This program will ensure

that if their home is not sold or if they don't want to sell their

home, they do have some relief over a three-year period of time in

which they can continue to own their own home.

This program

also provides help for those who want to buy a home in British

Columbia. Along with this mortgage relief program for the three-year

period, there is also the first home grant from the federal government

of $3,000 and the first-home family grant in British Columbia of

$2,500. That's $5,500 available for those people who want to build

their first home. Combined with this 12 percent mortgage relief

package, it is now possible for some people to either purchase an

existing home or construct a new home in this province. There are

spinoff benefits as well which were touched on by the member for

Central Fraser Valley (Mr. Ritchie.) He elaborated more than I will;

nevertheless, the spinoff benefits are the jobs that this program will

generate. Mr. Speaker, I'm a strong supporter of this legislation

because it is a good and positive measure. It will be one step towards

economic recovery in this province. I support this legislation because

it's going to help so many British Columbians.

MR. HALL:

I like the ex-minister's enthusiasm for his portfolio, now that he's

left it. If he had only shown that enthusiasm when he had the

portfolio, we would have been applauding him all the way. If he had

burned as much midnight oil in the year he was there as this minister

has burned in the last two days, I would have applauded him all the

way. The trouble is, I think this minister has been burning the

midnight oil for the last two days just signing election addresses and

sending out the brochures that we, on this side of the House, don't

have yet.

HON. MR. CHABOT: I'll send you one.

MR. HALL:

Thank you. Would you send one over by a Page? Then I can know what the

program is. The members of the gallery will be interested to know that

we're debating this bill, not yet law, about mortgage assistance for

the people of British Columbia. The official opposition do not have the

brochures that are going out in the next election campaign, while the

people on the other side of the House already have them on their desks.

That's the kind of thing that gets the second member for Surrey — one

of the soon to be three members for Surrey, and they will all be on the

same side of the House, and it'll be that side — a shade exercised.

Bill

79 is an election bill; make no mistake about that. It's more to

shelter Social Credit electoral hopes than it is to shelter B.C.

citizens; there is no denying that. It's going to help some people.

Analysts — we have them all on record from the financial pages of our

daily newspapers — point out that it will help a number of people.

We're going to support it because of that.

Mr. Speaker, if

you want to help people in a mortgage plan, it's not a very difficult

thing to do once you've decided to pluck up your courage and send some

money — it's got to be taxpayers' money — on a trip. You have to pluck

up your courage, get a computer and some mathematicians and decide how

much and at what rate you're going to send the money on a trip, because

the money is going to come back. Any mortgage expert will tell you that

eventually that plan will cook like my grandmother's old roast beef

used to cook in the oven — a dripping roast will cook itself.

We've

now got this new expression called "off-budget money." I used to debate

finance bills with the father of the present Premier, and he had all

sorts of expressions for different kinds of money. Contingent

liabilities — that was debt. Now we've got off-budget money. That's

money, Mr. Speaker, with the Minister of Finance's picture on it

instead of the Queen's. It's nonsense, isn't it, Mr. Speaker? You know

it's nonsense and I know it's nonsense, but we'll pretend it's really

serious. It's going to be borrowed, it's going to be debt, and we all

know when we read the bill, as the member for North Island (Mr.

Gabelmann) says, that it comes out of consolidated revenue. So it's as

much off-budget as the whole damn budget was off-budget when we knew it

was in April.

This is part of a package put together since July 29 for the survival of Social Credit. We've been here a week, and this is

[ Page 9251 ]

the

first part of any legislation at all that's got the slightest, remotest

connection with economic recovery or assistance to anybody other than

the government itself in survival at the election next time we go to

the polls.

It was the same last year when we had this little

session. We got telegrams last year telling us the public interest

demanded our attention here, and we all came racing in looking for an

economic plan. This year you didn't even send us a telegram. You sent

us a letter and three days' notice that the public interest demanded we

come here, and we spent a week learning how to carve the new electoral

boundaries.

This plan, Mr. Speaker, will help some people.

In my view it's too late for the government to try to take the credit

it's trying to take. It should have been brought in when interest rates

were at those obscene heights of six or seven months ago. If it's going

to help anybody at all now — and we think it's going to help a few — it

would have helped that many more when the interest rates were in the

22, 23, and 24 percent range. As I say, we've got this new expression

of "off-budget money."

On the way to the ferry the other

morning, I tuned into CKNW, Mr. Warren Barker's morning viewpoint. He

said he was cynical enough to believe that the repayment program was

indeed scheduled for the election after next. Not the words of the

member for Nanaimo (Mr. Stupich) but those of Mr. Warren Barker, CKNW:

no government would ever call the debt three years down the road. It

will be part of another election package in 1985, 1986 or whatever. The

next election will be after the one that we're waiting for any day now.

AN HON. MEMBER: That's socialist accounting.

MR. HALL:

That was the view expressed by the media one day this week when I was

driving to the ferry. That's the kind of cynicism that this government

has already introduced in the media by this kind of electioneering

while we've been here debating Bill 80 instead of getting on with an

economic survival program.

In addition, may I say, as I go

through this bill, that I was astounded to see in the regulations

section, as was mentioned by the member for North Island — subsection

2(f) — which seeks to suggest that regulation can define, enlarge and

restrict words and expressions that are used in the act. I don't know

whether that's an example of the privatization of the

Attorney-General's department and the legislative counsel that's been

going on, where we now have private companies working for the

government drafting legislation, working for them in a legal way that

we raised in question period. It seems to me that that has appeared in

our legislation before; regulations cannot seek to draw onto themselves

powers that don't exist in the act at all.

The minister's

remarks, of course, were of more than passing interest when he

introduced the press to the bill. I think they were, while not as great

and foolish a mistake as the one made by, say, the Minister of

Environment (Hon. Mr. Rogers), when he said that he knew nothing about

the environment when he was first sworn in, or as the various remarks

made by my colleague from Surrey (Hon. Mr. Vander Zalm) from time to

time — gaffes of unfortunate consequence.... For this minister, new

though he is, to have made the statement that he doesn't really mind if

this interest-free mortgage money goes to buy cars, because it helps

the car dealer, shows a mindset that I think is rather unfortunate. If

he'd have said that they could have bought furniture or some other kind

of equipment for the house — food, or paid some bills or something —

that's one thing, but the mindset over there for car dealers and cars

comes through every time. It's Freudian and clinical.

While

I know the minister will not take too much umbrage at me reminding him

of it, that really was a gaffe. I hope, now that the ribbing is

obviously over in cabinet and elsewhere, that you don't make another

one like that.

MR. LEA: He will.

MR. HALL: No, he won't, because he won't have enough time.

The

trouble with the bill, as we on this side see it, is simply that it's

not part of an overall plan for housing. That's due to a different

approach to the problem. That's due to a different philosophy, if you

like, a different list of priorities, a different thrust or a different

background — whatever differences there are between us. That's fair

enough. I'm sure the minister knows that. There's no gain saying that

those differences will always be there.

What it does is to underscore that when you don't have a Minister of Housing,

when you're the only province without an agency simply for the building

of homes, for cooperating with builders, for cooperating with cooperators, for

cooperating with developers and for developing a strategy, then, of course,

you are going to get these piecemeal approaches. If we don't have a strategy

that's worked out in concert with agencies in local government for housing

development, then we are going to get these differences of policy between a

group of people on this side of the House who believe that housing is much more

important in the scheme of things than does the group on that side of the House.

That's fair enough.

The

pump-priming effect and the opportunities that are there for an

aggressive minister and ministry of housing, in concert with al of the

agencies we know about, is really a failed opportunity in this province

at this time.

We've got architects who win prizes and

builders who win recognition, but we don't have imaginative proposals

on any basis at all in those sectors of the housing market that need

stimulus or money supply. We just don't have those kinds of imaginative

proposals coming from this government. When I go, as I do, perhaps as

frequently as anybody and more than most, to help open cooperative

units in my riding in Surrey, the missing factor is always the

provincial government. We have not seen an attempt by the provincial

government to assist municipalities south of the river, for instance,

with the infilling problems that you, Mr. Speaker, and I know about so

well: north Delta, in your riding, and north Surrey, in my riding,

where the rapidly burgeoning, developing urban areas have left

five-acre and three-acre lots behind that need attention, surrounded by

bureaucratic red tape and regulation, owned by old people who think

that that five-acre or three-acre lot is their pension, but who are now

unable to do anything about it. There are no imaginative proposals —

not from this minister; obviously he's had no time to do it. He

probably could do it if he put his mind to it. There were none from the

minister before him and none from the minister before him. That's

what's required in the rapidly burgeoning areas of north Surrey, north

Delta, etc.

With this bill, of course, there could have been

a companion bill — no foreclosures. Why not? What's good enough for

Manitoba and Saskatchewan should have been good enough for B.C. The

protection afforded the citizens of Manitoba and

[ Page 9252 ]

Saskatchewan could have been afforded the citizens of British Columbia — that's missing.

What

we must avoid at all costs is another AHOP disaster. I hope the

minister will assure us that we will avoid another AHOP disaster, with

people walking away from these problems. I don't want to see a

continuation of the problems in the Surrey area — not providing

adequate housing for the people in that area.

Of course, the

other thing it doesn't do is take into account that there's more....

The ex-minister said 60 percent of our population own their own home,

or have a contract to own their own home. Of course, that varies from

place to place within the province. A great many people are renting who

would like to buy, to get into accommodation which we could perhaps

euphemistically call starter houses. No imaginative proposals have been

put forward there.

In

summary, this plan may increase some

sales. It's doubtful if it will increase the starts. We had some

selective statistical reading by the member for Columbia River (Hon.

Mr. Chabot) about starts in 1981. I would have liked him to have given

us a figure for finishes, remembering all the MURB and holes in the

ground. While this bill will help some people, I don't think it will

give the housing industry a shot in the arm for new construction. That

really means it's another opportunity that we've not fully grasped and

taken advantage of.

HON. MR. McGEER: Mr. Speaker, may

I join others in congratulating you; perhaps I should be commiserating.

Certainly I can't speak for the others in this House, but you can

always count on the member for Point Grey to uphold decorum and

discipline in this House. Of course, no better example could have been

given than yesterday.

We're looking to the future on this

side of the House, not to the past. Therefore it's a great pleasure for

me to be able to speak in favour of this bill, and to commend the

opposition, who sometimes have been cast in the role of negative

doubting people, for lending their support as well to this particular

piece of legislation. I know that the member who just took his place is

extremely glad that he was able to come back from Europe in time to

speak in favour of this bill, to give it his support as well. I feel

the same way. It was worth the trip. Who were left as the negative,

doubting people on this particular piece of fair and forward-looking

legislation? The only negative, doubting people that are left, as far

as I can tell, are with the daily disaster, the Vancouver Sun ,

which has come out with a special report — "Mortgage plan could bring

you lots of grief." A bill like this is, as the opposition points out,

long overdue, given the punishing effects of high mortgage rates,

something totally outside of the control of the government of British

Canada does have methods of escape from high interest rates that the

province of British Columbia does not have. I think that all members in

this House are aware of why crushing interest rates have suddenly been

inflicted on the world like a plague. It's because the method of

currency-control, which must lie principally with the United States —

because the American dollar is the closest thing we have to world

currency today — has been let escape because of the increase in

payments abroad for OPEC oil. I've spoken in this House before about

the crushing effects that OPEC has brought on the economy of the

western world.

As America tries to repatriate its own

currency and, in effect, maintain control of what is the world's only

currency, they do it by the mechanism of increasing interest rates. In

order to retain capital, Canada, Western Europe and most other nations

with extensive investment possibilities must also increase the interest

rates in order to hold their currencies. We've had to do that in

Canada, and as we do so, little people — helpless people — are the ones

caught in that vicious crunch. These are the ones that own modest

homes, have mortgages and suddenly, through no fault of their own, are

placed at an enormous economic disadvantage compared with their fellow

citizens who may have got further along the road in the most important

purchase of their life, which is their personal castle, their home. So

it's entirely fair and appropriate that individuals who have been

injured by world political events that have reflected upon massive

currency moves around the world should be sheltered and protected to

the extent that a provincial government, powerless to act against the

larger forces in the world, can nevertheless bring forward legislation

to shelter its own citizens who have been hardest hit by this

international plague.

We could look to the member for

Vancouver Centre (Mr. Lauk) to give us more realistic predictions on

the banks and interest rates and those sorts of things, but it's our

feeling, subject to confirmation by the member for Vancouver Centre,

that interest rates will come down. That's of little consequence to the

average citizen who must face the mortgage rates of today, who attempts

to do some forward planning, not knowing what the renegotiated rate

might be tomorrow and whether that will fit in with his own paycheque.

Financial planning is impossible for the ordinary citizen, in matters

such as the purchase of a home for people of limited means. This

interest-rate subsidization gives a degree of certainty in an uncertain

world to those citizens most punished, most afflicted by this

international plague, and therefore most in need. In time, the world's

monetary system will recover. Hopefully, the OPEC cartel will be

broken. Hopefully, Canada will shield itself by switching from oil to

natural gas. I don't want to stray from the principle of the bill, but

these things are all interrelated, Mr. Speaker. The first and most

important step that we can take is to provide this degree of financial

certainty at little cost to the taxpayer, but at great social benefit

to the province.

Some might say that one group of citizens

is being particularly privileged compared with others, because this

subsidy is not directed at those who are wealthy or own their own

homes. That's untrue, Mr. Speaker. This subsidy is being directed at

those in need, in exactly the same fashion that you make medical and

hospital facilities available to the ill. They're put there for

everybody, but only those in need will need to take advantage at any

particular time.

This is legislation of high social benefit,

of low cost to the treasury, and is the kind of thing governments

should always be prepared to do. As one who is voting in favour of it,

I'd particularly like to commend the opposition on their wisdom and

desire to help out the people of the province in the same way.

MR. NICOLSON:

I'm glad the member who just spoke is engaged in neurological research

and not in economics, mathematics or anything else. I guess he should

really be engaged in some kind of wishful, fantasy-fulfilling role,

evidenced by the optimistic attitude that he brought to this

[ Page 9253 ]

new

B.C. home program. The program will help some people. The program will

certainly help people who can manage the mortgage payments that they're

already making.

Let's look at who it's going to help and how

it's going to help people. This plan is only going to help people if

mortgage interest rates remain high. If they come down to 12 percent,

this program is not going to be needed. That's pretty obvious.

Interjection.

MR. NICOLSON: The member for Central Fraser Valley (Mr. Ritchie) agrees with me on that.

HON. MR. BRUMMET: I won't argue with that, either.

MR. NICOLSON: And the minister agrees.

Some

of the members on the opposite side have predicted a drop in interest

rates. But some of those same members have been predicting an increase

in U.S. housing starts for the last two or three years. They've been

predicting that U.S. housing starts would go back up to normal and that

lumber exports would go back up to normal. Indeed, in the last budget —

only last April — we were being told that. You talk about off-budget

items. I was reminded by my colleague as he spoke about an off-budget

item, and how far the budget could be off. A now predicted $1.7 billion

is how off-budget we are in this province. However, this money is

supposed to come from off-budget items.

I come back to this

premise that people will get the maximum benefit from the program in a

worst-case scenario; that is, that interest rates remain very high. The

people who can benefit the most under that worst-case scenario are

those who can afford to make their payments. A person who can afford to

make payments is going to get, based on an 18 percent mortgage, with a

differential of 6 percent being the full difference between a 12

percent and 18 percent rate.... If that mortgage is at the maximum

amount allowed under these regulations, which I guess have been passed

by some order-in-council — they're printed up in a little leaflet now,

but they are not in the act — it means this will be a $60,000

principal, and that for the first three years you'll get about $280 a

month.

Interjection.

MR. NICOLSON: Oh, no.

It's going to be quite a bit. By the end of three years you would

receive $9,392, according to the

article by Mike Grenby, which is my

starting point. I take some of the ideas brought out by Mike Grenby in

his

article a little further.

You then have an interest-free

loan for the fourth year, so you have a total of $9,392 for the full

fourth year. One could say that the average principal you would possess

for the first three years is $4,696, the principal during the fourth

year would be $9,392 and the weighted average for the principal over

the four years would be some $5,870. So a person who continues to make

his full mortgage payments by taking advantage of this would have that

much money at his or her disposal.

MS. BROWN: To buy a car.

MR. NICOLSON: Yes, to buy a car, or maybe to invest.

Let's

assume that interest rates do stay constant at 18 percent throughout

this period. That money could be invested at short-term rates. If

mortgage rates were at 18 percent, it might be safe to say that

short-term rates might be at about 14 percent, which means the person

could realize in simple interest about $3,287 — say $3,000. So that

would be the kind of a return that a person could have by investing

that average principal for four years at a rate of 14 percent. I

haven't bothered to compound it, but that could be done. It would make

it a little bit higher than $3,200. I haven't done that because it

would be a little bit difficult to invest it every month, as the

cheques came in, and there'd be a little bit of slippage, so what you'd

make up one way you would lose the other, so say roughly $3,000.

I've

talked to various people about this plan so far and I've advised people

that are fairly well off, that aren't having any trouble with their

mortgage payments, that if their mortgage payments go over 12 percent,

by all means they should take advantage of this program, But make sure

you invest the money and that you're in a position to pay it back at

the end, because if you can't pay it back at the end, and if your

income does not allow you to get financing.... I see the government

says that they will provide some kind of a repayment program, but the

government provides in this act that they will have a charge against

the title of your property, which really means that the government has

the right to foreclose or take your property away if you can't pay back.

MR. RITCHIE: Come on, Lorne. You know better than that.

MR. NICOLSON:

I certainly do know better. I know why that provision is in there; I

know why it was in the home acquisition act. But let's not ignore the

fact that that particular item is there and that what we are playing

with here is something very dangerous.

Now I want to talk

about the person who is having difficulty making payments and who might

be looking at this thing as some kind of a saviour. If a person is

going to have to use this plan, interest rates are going to have to

stay over 12 percent. Had that person been paying off his mortgage, the

reduced principal at the end of four years would have been $59,188; in

other words, part of that principal on a $60,000 mortgage would have

been paid off. By taking advantage of the maximum loan of $9,385, there

would now be a new principal, and the principal would be $68,573. The

principal would no longer be $60,000. It would be $68,573 that's owed.

This was a 25-year mortgage — four years have gone by — so there would

now be 21 years left to pay. You would have to compute new monthly

payments at 18 percent to still pay off in the same time period. From

the available mortgage tables, per thousand dollars for a 21-year

mortgage, it costs $14.86493 per month; in other words, multiplying

that by 68.573 would give you a monthly payment of $1,019.29 when the

person was originally paying about $879.83. On a payment of $1,019.29,

if he's having to make that kind of payment, and if we think that his

original loan was only $60,000 and that he really would have had it

paid off a little bit down to $59,188, the effective rate of that over

a 21-year period is 21.12 percent. In other words, the person is going

to have to pay more than 3 percent of the assumed market mortgage rate

for the remaining 21 years of the mortgage. In order to get 6 percent

mortgage interest relief for three years, and then a free payback on

the loan for one more year, which

[ Page 9254 ]

adds

up to an average loan of about $5,800 at the maximum case — an average

loan, because you don't have a total loan.... No one can say that you

have a loan of $9,000 for four years; it's an average weighted loan of

about $5,800. In order to get that 6 percent interest relief for three

years — you then have to go back to paying at full rate, but you don't

have to pay back the benefit until the end of the fourth year — you are

going to face an increase in the effective interest rate of over 3

percent for the remaining 21 years.

This sounds like the

athlete or the entertainer who injects a foreign substance into the

body in order to get a little bit of a high, a little bit of an edge,

for a very short term, but who has to pay a long-term price for that.

It is something that people are going to have to enter into on the

soundest advice. For people who presently have a 16 percent mortgage —

and the amount of the principal of the mortgage might even be beyond

the maximum amount; it might be a $100,000 mortgage — and if they're

making their payments, I say, sure, take advantage of the program. But

if you desperately need this assistance to put bread and meat on the

table, then I pray that your financial position and your fortunes

improve tremendously in the next three years, because you're going to

need it. It might be okay for a couple, both of whom are attending

university, and they can see their fortunes on an upturn in the next

few years. It might be okay for a young optometrist who is kind of

heavily in debt in the first two or three years of his practice, but

who can see his practice bringing in a much better rate of return in

three years.

It can help some people. For that reason I will

support this bill, but I will also make it my duty to warn people of

the pitfalls of the choices, and to urge the government to do something

better. If this is the least the government can do, then I will have to

support this least the government can do. I believe the government

could do better. I believe that this particular piece of legislation is

not going to stimulate housing starts in a meaningful, way, as claimed

on this side of this piece of literature. When the full force and

effect of this piece of legislation comes through, I think it will be

seen for what it is: something that must be entered upon like a

marriage, with much thought and consideration. It is a very serious

step, because this payback is going to be your partner for 21 years if

you have an average type of a mortgage, if you have a typical case

mortgage, and if this thing really does turn out to help anybody. If

mortgage rates remain at 18 percent, if a person is starting off in a

25 percent mortgage, then you are going to be wedded to an extra 3

percent on your mortgage payback for 21 years — after you've had a nice

honeymoon of four years.

HON. MR. WILLIAMS: I would

like to take this opportunity to rise and speak briefly in favour of

this forward thinking, imaginative legislative program which has been

introduced by the Minister of Lands, Parks and Housing (Hon. Mr.

Brummet.)

[Mr. Strachan in the chair.]

I've

listened to members of the opposition, and frankly, I am startled at

the narrow view which they are taking of this program. In the course of

their remarks, however, it is clear that while they have been referred

to as negative doubting people in the past, that should be changed.

They are not only negative, not only doubting, but also pessimistic

about the future of this province. Of course, if you want to look at

the present economic circumstances in which we find ourselves with a

pessimistic attitude, then of course it can produce the kind of debate

— if that's the term — that we're receiving from the members of the

opposition.

I'm surprised at the member for Nelson-Creston

(Mr. Nicolson), who has just taken his seat. In the opening part of his

remarks he made a suggestion with respect to this bill which indicates

that he doesn't understand that there are people out there in the

province who need a little help. He says: "Well, of course, if the

interest rates come down, then it's no help at all." That's like saying

to a person who has broken his or her leg that while the leg was

broken, you needed a cast, but after the leg was mended you didn't need

it; therefore the cast is of no value. I don't understand how mixed up

that member can be.

MR. LEA: He said you don't put the cast on after the leg is mended.

HON. MR. WILLIAMS:

That's exactly what he said. The member for Prince Rupert (Mr. Lea)

understands how ridiculous the member for Nelson-Creston is. The member

for Nelson-Creston just said if your leg is not broken, you don't need

a cast. I agree with that. And the member for Prince Rupert in all of

his wisdom understands that. Now if he understands that, perhaps he

will understand some other things about this program.

The

member for Nelson-Creston said that all those people who are rich will

take advantage of it. Now he says the interest rates are going to go

down. So what advantage is there if you're rich? You can get a maximum

of 6 percent interest relief on $60,000. He's given you the figure —

$280 per month. If you're wealthy and you put a mortgage on your house

and get this interest advantage, you get $280 per month which you could

put into the bank. If you go to the bank today you'll get, if you're

very lucky, about 14.5 percent. So this wealthy person is going to go

into this program for the purpose of gaining a point and a half — 1.5

percent. The member has already indicated that there'll be slippage so

there'll be less advantage than 1.5 percent. That will be what will

accrue to you. Plus the fact — and he seems to have ignored this — that

if you go through this process and take advantage of this program when

you don't need it, you will have to pay income tax on the interest

income that you receive. So if you're very rich, that will cut that in

half. If you go through all this process, the total benefit will be

about one half of 1 percent on $60,000. Now that's a tremendous bonanza

for people who are wealthy.

Mind you, in this House there

are some people who will take advantage of it for that purpose. I

wouldn't like to suggest that it'll be the opposition, but they've got

all these ideas and therefore I have to think that they are alert for

investment opportunities in this province today. Those members over

there know how to make a buck; they know how to take advantage of all

these programs, because I would never have thought of such a scheme.

The

other thing he suggested is that people will take advantage of this

program and they'll use the $280 per month to buy a car or a boat or

maybe take a trip to California. I guess that now that the Leader of

the Opposition has come back from California, California needs the

assistance, so they'll send somebody else in his place. I just want the

NDP to go out into their constituencies, if they dare, and say to all

[ Page 9255 ]

those people: you mustn't take advantage of this program because you're going to buy a boat or a car. Ridiculous!

The

program is designed to provide an umbrella, a measure of protection,

against the high interest rates with which we are presently faced. The

hon. Minister of Universities, Science and Communications (Hon. Mr.

McGeer) has dealt with the reason for this, and the fact that there are

homeowners out there who are faced with this problem; it's something

that they can't solve. The government is saying that to the extent that

we are able, we are prepared to provide you with a significant measure

of relief over three years, because this government, in being in

control of what's taking place in the economy of this province, is

satisfied that three years hence, circumstances will improve, wages and

earnings will have increased, and then those people will be able to

meet the payments.

Interjection.

HON. MR. WILLIAMS:

I hear the second member for Vancouver East (Mr. Macdonald) chirping

out. That wealthy member, who lives in Point Grey and never goes into

Vancouver East, doesn't have these problems, because his house on the

waterfront in Vancouver — I forget how much it's worth; it's just

tremendous — hasn't got a mortgage on it. It's all paid for. So he

doesn't have these worries. Maybe he's one of the rich people who will

take advantage of the program so he can get the one-half of 1 percent

on $60,000. He's a silk-purse socialist. He chivvies in this thing....

MR. MACDONALD:

On a point of order, is this really the Attorney-General of British

Columbia who's discussing the mortgage bill? I can't believe it.

DEPUTY SPEAKER:

Order, please. That is not a point of order with respect to the

minister's portfolio; it is a point of order with respect to relevancy.

I would remind all hon. members taking their place in debate that we

must be relevant to the bill, Bill 79, Homeowner Interest Assistance

Act.

HON. MR. WILLIAMS: I thank you for redirecting my attention, Mr. Speaker, because that member had distracted me.

was about to say that the hon. second member for Surrey (Mr. Hall) said

that this wasn't going to do anything for the housing industry. One of

the problems that afflicts the housing industry today is low sales. One

of the reasons that the sales are low is that there is a serious

reluctance on the part particularly of young people to make this major

business decision at a time when interest rates are high, and there is

uncertainty about the future and what it will cost them if they get

into this home. This program will resolve that problem because we will

remove that uncertainty for a period of three years. Therefore young

people who are looking at acquiring a home, whether it's a new home or

an old home — the person who occupies the old home can then move into a

new home, so the housing stock begins to roll over again in this

province; which helps the housing industry — will go in knowing that

for three years, 12 percent is what they face. When you remove that

uncertainty you remove the fear.

Members of the opposition

said they have heard from their constituents about this program, and

that they're worried about it. I've heard from my constituents as well,

and I know that young couples who, because of uncertainty and fear

about what the future might hold, have delayed making the decision

about the acquisition of a home, are continuing with their young

families in accommodation that is not appropriate for the size of their

families. But with this program that fear is now removed. Sure, they

appreciate that three years hence they'll have to pick up the load, but

they're optimistic. They're not pessimistic like this opposition. They

had the optimism to get married in the first place, the optimism to

have a family in the first place, and they're optimistic about their

future in this province. The opposition is not. The opposition would

say to them, "Oh, no, it's going to be bad, bad, bad — unless you vote

for the NDP."

But if they vote for the NDP, not only will

they be offered the possibility that their mortgage will be deferred:

they'll be offered the opportunity that British Columbia will go into

deficit financing, and the whole cost of government will be deferred

onto future taxpayers. That's the kind of opportunity they will offer.

They don't seem to recognize that they would go into deficit financing

and push the burden of cost to the future. Yet they won't support this

program whereby for three years we say to the people: "Look, we'll give

you a little bit of relief, but don't forget you are going to have to

pay the bill." They're prepared to deficit finance. They're prepared to

spend the money today against payment tomorrow, but they don't tell the

people that tomorrow they're going to have to pay the bill. We're being

fair to the people in this respect. If people don't want to take

advantage of this program, that's their choice. We're giving them that

choice. All the information is up front. They can make a business

decision, knowing all the factors. That's not what the NDP would do to

them.

When you acquire a house, whether it's your first or

second, there are a lot of expenses that you never think about. I know

of a recent case of a young couple who just acquired their first home.

When you go in, you have to buy some drapes for the windows, a new

garden hose which you've never had before; you may have to buy a

lawn-mower or grass-rake, and all those little things that you never

think about when you're setting up your first home. You make your down

payment, pay the costs of the conveyance, pay the adjustments of taxes,

water and so on, and get into your house, but suddenly you find that

there are other significant expenses.

For those people, I'll

tell you that the opportunity to have an additional $280 a month is a

very significant factor in the first few years and months that they're

in that new home — that little bit of additional money to spend for the

things they need. The housewife may have to buy some new pots and pans,

and they hadn't figured on those things. This weighs heavily upon these

young people. Therefore we're giving them the opportunity not to buy

cars, which is what the NDP thinks about.... I guess that's why they

have their Mercedes Benz cars that we see them driving around in....

That's

not what the young people in this province need or want. They're

prepared to meet those extra costs and burdens associated with home

ownership. This government, through this program, will release some of

the pressures....

Interjections.

DEPUTY SPEAKER:

Order, please. I'll ask the member for Omineca (Mr. Kempf) and the

member for Burnaby Edmonds (Ms. Brown) please not to interrupt.

[ Page 9256 ]

HON. MR. WILLIAMS:

This program will enable these people to have a little more expendable

funds. Having met some of those obligations, I know that these young

people who are optimistic about the future will treat this program

intelligently and responsibly. If they can make all the payments called

for under their mortgage or a major portion thereof, yes, they can take

the additional money and put it into a bank account, because they're

going to have to pay it back. Responsible, intelligent young people

will do that. They won't, as the NDP would suggest, go out and spend

the money foolishly and frivolously. That's not the kind of young

people we have in our society today; that's the kind of young people

that the NDP would like to suggest to you that we have in our province

today. They had better go out and talk to their constituents. They

better go out and understand that there are some people who, when given

the opportunity by this government, will deal with it responsibly and

intelligently.

MR. MACDONALD: You're a smear artist. You're a turncoat and you feel guilty.

DEPUTY SPEAKER: Order, please.

Interjections.

[Deputy Speaker rose.]

DEPUTY SPEAKER: Order, hon. members.

Interjection.

DEPUTY SPEAKER:

It's unparliamentary to interrupt a member who has taken his place in

debate, and I will commend that to all members of the House — the

Minister of Industry and Small Business Development (Hon. Mr.

Phillips), the second member for Vancouver East (Mr. Macdonald), and

all of the members who are interrupting.

[Deputy Speaker resumed his seat.]

MR. HOWARD:

My point of order relates to the Minister of Forests (Hon. Mr.

Waterland). It's a well-known rule — and you need to enforce it on all

sides of the chamber, not just one, Mr. Speaker — that when Mr. Speaker

rises in his place everyone sits down. While you were on your feet,

Your Honour, the Minister of Forests was wandering back and forth

behind there paying scant, if any, attention to Your Honour. I draw

that to Your Honour's attention.

AN HON. MEMBER: Where is he?

MR. HOWARD: He's absconded as usual.

DEPUTY SPEAKER:

The point of order was well taken. There were many interruptions while

the Chairman stood, from both sides of the House; however, the movement

and conversation did cease. The House is now in order.

HON. MR. WILLIAMS:

I'm sorry that my remarks have raised the emotions of the opposition.

Perhaps I should just say to the Minister of Lands, Parks and Housing

that if anything was needed to convince me of the rightness of your

program, it is the fact that when the program is clearly explained in

this chamber the members of the opposition react in their usual way by

alleging that we're slimy and sleazy and smearing people. They can't

take the heat that your program is generating.

Interjections.

DEPUTY SPEAKER:

Order, please. I'll ask the member for Skeena (Mr. Howard) to not

interrupt. Any further interruptions by any member will have to be

dealt with.

HON. MR. WILLIAMS: As I conclude, may I

simply say that I do not consider it to be a slimy smear to refer to

the young people of this province as intelligent and responsible.

MS. BROWN: We have just heard from the sleaze champion of that sleazy, corrupt, government over there.

DEPUTY SPEAKER:

Hon. members, please; parliamentary decorum must be maintained. We may

express differences of opinion in debate, but please, personal

allusions and language such as that are really quite unacceptable. I'm

sure all members of the House are aware of parliamentary moderation and

temperance of language.

MS. BROWN: In continuing on

the bill, I just want to remind the House that that Attorney-General is

the same one who has been cited on a number of occasions by the

ombudsman for his obstructionist tactics in the delivery of justice in

this province, for which he is supposed to be responsible. I also want

to remind everyone listening that that Attorney-General is the one who

has made a mockery of justice in this province as a result of some of

his actions. I for one hope there is no truth to the rumour that he is

seeking a judgeship, because God help justice in this province if he is

ever elevated to the bench.

HON. MRS. McCARTHY: On a

point of order, Mr. Speaker, I would like to ask your guidance with

regard to the principle of this bill. It seems to me the member who is

on her feet is straying very widely from the principle of the bill

before us, and I think that is out of order.

DEPUTY SPEAKER:

That's a valid point of order, one accepted, as a matter of fact, just

a few minutes ago when the hon. second member for Vancouver East raised

the same point of order. So it applies to all members of this assembly.

MS. BROWN:

I don't know why it is that whenever a member over there uses the word

"principle, " it always sounds so strange. Because obviously they don't

know anything about principle. If there's one thing that government

doesn't know anything about, it is principle.

DEPUTY SPEAKER: Order, please. To the bill.

MS. BROWN: Back to the bill.

The

Attorney-General, who, having delivered his diatribe, has now left the

room, told us how helpful this bill is going to be to the people of his

constituency. I want to tel I you something about the people of

Burnaby-Edmonds who are not going to be helped by this bill. They are

the unemployed people — the people who are the victims of the economic

policies of that government over there who find themselves laid off and

without a job, who are going to lose their homes

[ Page 9257 ]

because they have no income whatsoever to meet any kind of mortgage payment. They are not going to be helped by this bill.

[Mr. Speaker in the chair.]

bill that would help those people would be a bill to create jobs in

this province. That's the kind of legislation that would have been of

help to them. The unemployed people of Burnaby-Edmonds would have been

happier if this government had done something about creating employment

and if this bill had dealt with protection against foreclosure, but

neither of those two things have been done. Maybe this bill is going to

be of great help to the residents of West Vancouver–Howe Sound. That's

what the Attorney-General (Hon. Mr. Williams) told us. I'll tell you,

the unemployed people in Burnaby-Edmonds, who are unemployed as a

direct result of the economic policies of that government, are not

going to be helped by this piece of legislation. That is one group that

the Minister of Lands, Parks and Housing (Hon. Mr. Brummet) can be

assured are not going to be taking the money, as he recommends, and

going out and buying a used car from his friends.

Mr.

Speaker, the second group who are not going to be helped by this bill

are those people who can't qualify for mortgages in the first place.

The people who most desperately need housing, who can't get housing

because they can't qualify for housing, are not going to be able to get

any benefits from this bill. I hope that when the Minister of Housing

stands up to close debate on this issue he will explain to us why this

legislation is supposed to help people who need housing, while this

particular group are not taken into account. Why is it that those

people in this province who cannot qualify for an 18 percent mortgage,

and so are not able to afford housing, were not taken into account when

this bill was being drafted? What about those people? They may not live

in West Vancouver–Howe Sound, but certainly a large number of them live

in Burnaby-Edmonds.

Mr. Speaker, what about the tenants of

this province? The minister is interrupting. I can't hear what he's

saying so I'm not going to pay any attention to it, because he's going

to have his say, of course, once he rises to close debate.

Incidentally, the other thing I want to know, when he's closing debate,

is the cost to the taxpayers of B.C. for this piece of Social Credit

pamphleteering. What is the cost of this to us, the cost of the Social

Credit colours, with the Social Credit logo on it? What are we paying

for this piece of political pamphleteering that the minister has on the

desks of every member over there and which he has not released to the

members of the opposition?

HON. MR. BRUMMET: I sent it down to your caucus on Tuesday. What's happened is up there.

MS. BROWN:

What happened to your courier service is the same as what happened

between you and your Attorney-General (Hon. Mr. Williams). You go out

and tell people to use the money to buy used cars. He stands up and

says that that's not what people want to do with the money and accuses

the opposition of suggesting that they use it to buy used cars. Why

don't you have the guts to stand up and say that you were the one who

said that the money should be used to buy used cars.

MR. SPEAKER: Order, please, hon. members.

MS. BROWN: This is on the principle of the bill, Mr. Speaker.

MR. SPEAKER: I appreciate that, but would the hon. member remember to address the Chair.

MS. BROWN: Thank you, Mr. Speaker.

Earlier

this year, in June specifically, the provincial rentalsman, Jim

Patterson, pointed out in a public statement that an increasing number

of tenants in British Columbia were defaulting and falling behind in

their rent. He went on in great detail to explain that as a direct

result of the kind of economic crisis which this province is going

through, as a direct result of the economic policies of that government

over there, tenants were not able to pay their rent. They were falling

in arrears or they were just defaulting. They are not protected by this

piece of legislation. There's nothing in this bill to help them. They

don't qualify for an 18 percent mortgage, so they're not going to be

able to go into first-time housing. There's nothing at all for them.

They're not even mentioned, as far as this legislation is concerned.

Two-thirds

of the units in Burnaby-Edmonds are not even covered by rent control.

Most of the people in Burnaby-Edmonds are tenants. So if I'm not

overjoyed and enthusiastic in my support of this bill, I think it

should be understood that it is probably because I live in

Burnaby-Edmonds and not in West Vancouver–Howe Sound. The

Attorney-General went on and on at great length about how great it was

for his constituents in West Vancouver–Howe Sound. It's not going to do

that much for my constituents in Burnaby-Edmonds. Most of the people

who live in Burnaby-Edmonds fall into a number of categories. They are

tenants and so they get no benefits whatsoever from this particular

piece of legislation. A large percentage of them find themselves

unemployed, so they are not going to be benefited, because there is

nothing in this bill to protect them against foreclosures. Now that

point has been raised by other members of the opposition in speaking in

support of this bill. Is the minister planning to amend this piece of

legislation to protect people against foreclosures? It has been done in

other provinces. Why was it not included in this particular piece of

legislation if, as we are told, it's supposed to protect the homeowners

of this province?

The third group are the first-time owners

who can't qualify. On the off-chance that there is one person in

Burnaby who is going to benefit by this bill, I am going to support it.

Just on the off-chance that there is one single resident anywhere in

British Columbia who is going to benefit from this piece of

legislation, I am prepared to support the bill. But I don't want the

minister to go out and make a public statement to the effect that I

think this is a good bill, because as I pointed out to him, the people

in most need are not going to have their needs met by this piece of

legislation. It's not going to stimulate any new housing. Most of the

people who want new housing don't qualify for an 18 percent mortgage.

The young people that the Attorney-General was talking about don't

qualify for an 18 percent mortgage. They're not making the kind of

income that one has to make in order to qualify for an 18 percent

mortgage, so they're not going to be rushing out and applying under

this bill for the $60,000 over the three or four years to go out and

start building themselves a new house. It's not going to be any help to

them.

Certainly those people in the riding who have been laid off, who are unemployed as a result of this government's

[ Page 9258 ]

policies

and have no income whatsoever, even to keep up their rent payments, are

not going to benefit from this bill. What those people need are jobs.

When we were called back here, Mr. Speaker, to debate the province's

business, I thought we were going to be discussing ways and means of

putting British Columbians to work. I thought this government had a

plan for job creation. Instead of that, we spent the first number of

days....

Interjection.

MS. BROWN: I'll just finish my sentence and then move adjournment.

spent most of our time talking about creating new seats for the next

election an