1984 Legislative Session: 2nd Session, 33rd 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)

WEDNESDAY, MARCH 28, 1984

Afternoon Sitting

[ Page

4079 ]

CONTENTS

Routine Proceedings

Tabling Documents –– 4079

Oral Questions

Ministry of Forests scaling practices. Mr. Howard –– 4079

Hardship assistance. Ms. Brown –– 4079

Expo 86 construction bidding. Mr. Gabelmann –– 4080

Financial aid to post-secondary students. Mr. Nicolson –– 4080

Hardship assistance. Ms. Brown –– 4081

Ministerial Statement

Major league baseball tournament. Hon. Mr. Rogers –– 4081

Mr. Lauk

Committee of Supply: Ministry of Transportation and Highways estimates. (Hon. A.

Fraser)

On vote 62: minister's office 4081

Mr. Mitchell

Partnership Amendment Act, 1984 (Bill 8). Second reading.

Hon. Mr. Hewitt –– 4084

Mr. D'Arcy –– 4085

Hon. Mr. Hewitt –– 4085

Income Tax (Health Care Maintenance) Amendment Act, 1984 (Bill 2). Second reading.

Mrs. Dailly –– 4085

Mr. Cocke –– 4088

Mr. Blencoe –– 4090

Mr. Lockstead –– 4090

Ms. Brown –– 4091

Mr. Mitchell –– 4092

Hon. Mr. Curtis –– 4092

Division –– 4094

Hotel Room Tax Amendment Act, 1984 (Bill 3). Second reading.

Hon. Mr. Curtis –– 4094

Mr. Cocke –– 4095

Hon. Mr. Richmond –– 4095

Mr. D'Arcy –– 4096

Mr. Reynolds –– 4096

Mr. Howard –– 4096

Mr. Campbell –– 4097

Hon. Mr. Curtis –– 4097

Division –– 4097

Home Owner Grant Amendment Act, 1984 (Bill 4). Second reading.

Hon. Mr. Curtis –– 4097

Mr. Blencoe –– 4098

Hon. Mr. Curtis –– 4098

Division –– 4098

Hydro And Power Authority Amendment Act, 1984 (Bill 13). Second reading.

Hon. Mr. Curtis –– 4099

WEDNESDAY, MARCH 28, 1984

The House met at 2:03 p.m.

Prayers.

HON. MR. CHABOT: Mr. Speaker, I'd like the members to join me

in welcoming His Excellency Lester Whitehead, high commissioner for

Barbados, and Mr. Keith Smith, consul of Barbados.

MR. SEGARTY: I would ask the members to join with me today in welcoming my very good friend and mayor of Fernie, Tiny Shatosky.

HON. MR. GARDOM: Mr. Speaker, today is the natal day of the

Minister of Energy (Hon. Mr. Rogers). The very interesting and cardinal

observation in his horoscope was that he "should confide in loved ones

only." If that's the case, Mr. Speaker, I do hope that today in

question period the questioners would so qualify. I think every hon.

member would like to wish him the happiest of returns.

HON. MR. PHILLIPS: Mr. Speaker, in your gallery today

visiting from Tokyo, Japan, are Mr. R. Saito and Mr. Sho Nakano of

Daishowa International, Mr. Kitagawa from Daishowa in Vancouver and Mr.

Nakakura from Daishowa in New York. With them is Mr. Henry Wakabayashi

from Vancouver. I hope the House will make these visitors welcome.

HON. MR. RITCHIE: In the gallery today we have Mrs. Johnson

with 16 grades 5 to 10 students visiting from Pacific Christian School

in my constituency. Would the House please welcome these guests.

Hon. Mr. McClelland tabled the annual report of the Workers' Compensation Board for the fiscal year ending December 31, 1983.

Oral Questions

MINISTRY OF FORESTS SCALING PRACTICES

MR. HOWARD: Mr. Speaker, I'd like to direct a question to the

Minister of Forests. Has his ministry conducted an internal audit or

other similar type of examination of the Shoal Island scaling practices

as enunciated in a report from the ombudsman and tabled in this House?

HON. MR. WATERLAND: Mr. Speaker, there have been ongoing

investigations, audits and examinations of all aspects of scaling

throughout the province of British Columbia for many, many years.

MR. HOWARD: It's interesting to note that he sidestepped the

question. Could I ask him then, with respect to these ongoing

examinations, specifically about the scaling practices at Shoal Island.

Has there been an internal audit, and is it completed?

HON. MR. WATERLAND: Mr. Speaker, I don't know what the member means

specifically by "audit." We have been examining the Shoal Island scaling

situation for many months — long before the ombudsman's report was tabled,

and continuing since that time. The examination is ongoing.

MR. HOWARD: I take it then that it has not been concluded.

HON. MR. PHILLIPS: You can take it any way you want.

HON. MR. WATERLAND: If the member wishes, Mr. Chairman.

MR. HOWARD: Inasmuch as the examination has been concluded,

can the minister tell us whether, as a result of that examination, they

discovered there was in fact a shortage in the volume of timber scaled?

HON. MR. WATERLAND: I can't tell the member that, Mr. Speaker.

MR. HOWARD: Can the minister confirm that as a result of that

shortage in volume of timber scaled there was a consequential shortfall

of income to the provincial treasury in stumpage fees, and also a

shortage of payment of moneys to the contractors?

HON. MR. WATERLAND: I can't tell the member that either, Mr. Speaker.

MR. HOWARD: Will the minister make that internal audit or examination, which has been concluded, public? Will he table it in this House?

HON. MR. WATERLAND: Mr. Speaker, I don't know if that

particular question is in order or not. In due course we will be

responding to Special Report No. 7, which was tabled in the House by

the ombudsman.

MR. HOWARD: One final question. Is it today that the cabinet will receive that particular report for consideration?

HON. MR. WATERLAND: Mr. Speaker, I'm sure the member is well

aware that the matters which take place in cabinet at any time are for

cabinet to know.

HARDSHIP ASSISTANCE

MS. BROWN: Mr. Speaker, my question is directed toward the

Minister of Human Resources: I'm standing in for my colleague from

Vancouver Centre. It has to do with the decision about hardship

assistance. According to

section 4(2)(

d) of the Trade Practice Act, if

anyone applies for credit while knowing that he or she is incapable of

repaying it, the contract is considered to be null and void. The

minister at one time, I gather, was a member of the credit lenders'

association. Now that this information has come to her attention, is

she prepared to modify the regulations dealing with hardship assistance?

HON. MRS. McCARTHY: Mr. Speaker, I can neither confirm nor

will I speak to any legal opinion put forward regarding the Trade

Practice Act. But I would like to speak to the hardship policy, as

suggested by the member. I think there has been a fair amount of

misconception regarding it in the

[ Page 4080 ]

past few days within the province. First of all,

there is an impression abroad that a new policy applies to all

applicants for income assistance, and I want to make it clear that the

hardship policy is based on

section 4 of the GAIN act, which applies

only to people who do not qualify for income assistance. That's a very

clear distinction, and I want to make that distinction because if

persons have assets which disqualify them from receiving income

assistance, then those assets include a range of things including a

credit in the community. It may be credit at the bank where they are

holding paper; they may have some equity in a house or in something

else. Whatever it is, they use the credit of their particular

individual circumstance. So we are talking about people who have credit

and the capability of being independent in the province, without having

help from income assistance or welfare. In the GAIN regulations there's

a hardship policy under

section 4 of the GAIN act. Those regulations

and that

section assist people even when they do not qualify — even

when they have assets. If for example they don't have food and shelter,

their rent is due and they cannot convert their assets at that time,

then under what we call the hardship policy they can be given help on a

very temporary basis.

MS. BROWN: For the benefit of the minister, I have the

regulation in front of me, I know precisely what it does, and I would

appreciate it if I could just get an answer to the question and not a

lecture on what the act says. In fact it says that an applicant has to

demonstrate that he or she has applied for and accepted available

income including loans and credit. According to the bankruptcy

legislation, to apply for credit when a person is insolvent and has no

means of repaying is fraudulent or near fraudulence. Is the minister

counselling people who are applying for hardship assistance that they

should indulge in this kind of fraudulence? That's all I'm trying to

find out.

HON. MRS. McCARTHY: Of course the Ministry of Human Resources

is not counselling anybody to go into debt nor to use fraudulent means

to obtain credit. For the member to put that suggestion to me and my

staff I think is an insult to our ministry. May I say this to you, Mr.

Speaker: if a person applies for income assistance or credit, it will

be on the basis of that person's qualifications that he is given either

credit or income assistance. The marketplace decides who can receive

credit in our community, not the Ministry of Human Resources. We do not

make that decision. If he or she does not qualify for credit, I assume

that the store or the financial institution that is handling that

transaction will refuse credit to that person. They always have; I

don't know why they wouldn't do so at the present time.

[2:15]

EXPO 86 CONSTRUCTION BIDDING

MR. GABELMANN: I have a question for the Minister of

Municipal Affairs. On what authority did the minister advise Bill

Kerkhoff that he should drop his LRB application to have Expo declared

an open site? Because the government would assure that Expo would be an

open-site project?

HON. MR. RITCHIE: First of all, this question has nothing to

do with this ministry; secondly, it is a constituency problem. At no

time were any instructions given. I deal with all my constituents

alike, and if there are questions such as arose concerning the freedom

of people to bid on particular jobs, I normally explain the policy of

the government, which is reflected by the legislation that was changed

I believe in 1977, to make it possible for anyone, union or non-union,

to bid on jobs.

MR. GABELMANN: Is the minister suggesting that he was

conveying government policy to Mr. Kerkhoff that he should withdraw his

application to have the board determine whether or not Expo was an open

site?

HON. MR. RITCHIE: On numerous occasions I have had an

opportunity to convey to many of my constituents who are involved in

the construction industry the fact that this government made a change

in legislation in this House which allowed for all contractors to bid

on jobs where public moneys were being used. The member should realize

that that is the case and that it is not a question of stating policy,

but rather a question of referring to legislation that is in place.

MR. GABELMANN: Mr. Speaker, I won't pursue the fact that

there is no legislation which talks about whether or not contractors

should be encouraged to proceed with applications to the LRB.

I have a question for the Minister of Tourism. Has the minister

discussed the letting of contracts for Expo with Bill Kerkhoff, or

anyone from Kerkhoff Contracting?

HON. MR. RICHMOND: The answer is no, Mr. Speaker.

MR. GABELMANN: To the same minister, Mr. Speaker. Did the

minister authorize anyone to contact Kerkhoff on his behalf with regard

to construction contracts for the Expo site?

HON. MR. RICHMOND: The answer is no, Mr. Speaker.

FINANCIAL AID TO POST-SECONDARY STUDENTS

MR. NICOLSON: A question to the Minister of Education. Many

students at Langara College and some at Simon Fraser University have

applied for provincial government grants under the B.C. Student

Assistance Plan for the two semesters beginning January 1984. Did the

minister give assurances to the Langara College students on March 6

that students who had received confirmation of their grants from their

financial administration officers would receive them, despite the

retroactive changes in the program from grants to loans?

HON. MR. HEINRICH: Mr. Speaker, I think the member is

referring to a meeting which I had with a student representative in my

office, and I think it was on the date to which the member referred.

The concern expressed at that time involved the grants and loans. I

made a statement to them that those grants to which a commitment had

been given — and I think it was before Christmas — would be honoured.

Those applications which had not been dealt with or received any form

of favourable consideration for the spring and fall of 1984 would

probably not receive the benefit of the grant, but the loan would be

made available.

[ Page 4081 ]

MR. NICOLSON: To the same minister. When you were asked

whether the local financial assistance officer's recommendation

constituted confirmation, apparently you telephoned one of your

assistant deputy ministers and then gave assurance that that was the

case. I think there were some 46 people who qualified by some December

date. Is the minister saying that those 46 people alone should receive

grants for the same period of education and that anyone beyond that

date will not qualify even though they may also have been told by their

financial assistance officers that they would qualify?

HON. MR. HEINRICH: I cannot recall the details with respect

to the discussion that took place at the time. It is correct that I did

phone the deputy in charge of colleges. I wanted to know the number of

students who had in fact made application and for which approval had

been given. I believe it was somewhere between 40 and 50 –– I thought

it was closer to 40 –– I also told the students at that time that those

applications which had been submitted and had not yet been given any

consideration would very likely not receive a grant and that the loans

would be made available.

HARDSHIP ASSISTANCE

MS. BROWN: This question is directed to the Minister of

Consumer and Corporate Affairs on the issue of the Trade Practice Act.

In an interview on March 23, the Minister of Human Resources stated

that people who applied for hardship assistance because they were

unemployed could use their credit card, because: "Woodward's would

provide them with groceries for up to $1,500." Can the minister confirm

that the minister was at that time suggesting that the applicant

indulge in something which would be a contravention of the Trade

Practice Act,

section 4(2)(d) ?

HON. MR. HEWITT: Mr. Speaker, with regard to actions by

another minister, I won't comment on that. With regard to the Trade

Practice Act and the concern the member has, I'll take the question as

notice.

MAJOR LEAGUE BASEBALL TOURNAMENT

HON. MR. ROGERS: Mr. Speaker, before we proceed to the next

order of business I would like to make a ministerial statement. As

members will probably be aware, this weekend marks the first occasion

on which a major league baseball tournament between two competing teams

will take place in the province of British Columbia. It will take place

at B.C. Place Stadium on Friday, Saturday and Sunday afternoons. As of

noon today, 80,000 tickets had been purchased. I think we can safely

say that....

MR. HANSON: Will you be in the box?

HON. MR. ROGERS: No, as a matter of fact, hon. member.

MS. BROWN: Mr. Speaker will be in the box.

HON. MR. ROGERS: Neither will the Speaker, for that matter.

The significance of this event, Mr. Speaker, is that the owners of

major league baseball will make a determination, based on the number of

people who appear at this particular series of games, as to whether or

not British Columbia will qualify to be included in their rather

exclusive club of cities which host major league baseball teams. It

would be the best thing that we could do for tourism in the province of

British Columbia. If the members opposite and others who have the

opportunity would take time out of their busy schedule, perhaps they

might enhance the numbers somewhat.

MR. LAUK: On behalf of the New Democratic Party, we wish to

fully and completely support the spearheading efforts of His Worship

Mayor Mike Harcourt to bring a major league team to the greatest city

in Canada. Only the other day His Worship informed me that in spite of

the diffidence of the hon. minister and this government, he will make

every effort to bring in a major league team. If one does come, it will

be a feather in the cap of the New Democratic Party mayor of the best

city in the country of Canada.

HON. MR. HEWITT: Mr. Speaker, I ask leave to make an introduction.

Leave granted.

HON. MR. HEWITT: Mr. Speaker, in your gallery are three

people from my constituency: Mrs. Miriam Wolfram, Mr. Brian Wiebe and

Mr. Dominic Morrow. They are representatives of Hardy View Lodge,

intermediate-care facility in Grand Forks, here to meet the Minister of

Health. I would ask the House to welcome them.

Orders of the Day

The House in Committee of Supply; Mr. Strachan in the chair..

ESTIMATES: MINISTRY OF

TRANSPORTATION AND HIGHWAYS

(continued)

On vote 62: minister's office, $218,797.

MR. MITCHELL: I directed a number of questions to the

Minister of Transportation. I will continue unless he indicates that he

wishes to answer the first two questions that I brought to his

attention.

The next question is one I have been discussing on and off in this

House since 1952: the problem of drainage in the Western Community. The

particular issue that I would like to bring to the minister's attention

is the Bilston Creek drainage problem, For your benefit, Mr. Speaker,

I'll give you a little of the history of the problem.

Bilston Creek drains a large area in the Western Community,

especially Happy Valley. Because of the problem in that area, the

Capital Regional District has put a land freeze on development of any

lands from which water would drain down into Bilston Creek. Over the

years I have attempted to have the Minister of Highways accept some of

the responsibility for upgrading the waterway so that those who live in

the low areas won't continue to be flooded every year and the

provincial emergency service won't have to continue to give funds for

flooding problems. For many years the Highways ministry said that they

would not accept any responsibility for the drainage of that area. They

considered it a local problem. A few years back the then Minister of

Municipal Affairs had

[ Page 4082 ]

dissolved the Bilston Creek Improvement District,

which was attempting at that time to bring in some rules, regulations

and standards for that particular drainage problem. Because of the area

being frozen for any subdivisions, many citizens and developers have

approached me and approached the Capital Regional District to have some

changes made so that they can proceed with their subdivisions or with

their development. In some of the undeveloped areas the developers have

gone ahead and put in roads, and cleared a lot of areas off, because

there's no law against putting a road on your own property. It only

becomes an offence when you attempt to sell a lot you have subdivided.

[2:30]

Each year the water is running down in larger and larger amounts

into Bilston Creek and causing problems. Recently the Highways ministry

has granted one particular developer an opportunity to do some offsite

work for a downstream benefit on Millstream Creek. He is being allowed

to submit some plans to clear out the Bilston Creek area, with the hope

that the clearing he does on the creek will alleviate some of the flood

problems. My main concern — and I've discussed it with the local

regional engineer — is that clearing the middle part of the creek is

not going to solve the downstream problem of flooding; what it's going

to do is move a large body of water more quickly from one clogged area

to the next clogged area.

I have attempted, through the regional engineer, to get the Highways

department to accept some responsibility for this particular problem. I

would like the Highways department to accept some of it. Now that they

have gone as far as allowing one developer to do some off'site work on

that particular creek, I would like the clearing to start at the bottom

end — the local area is known, I believe, as Forest Way Road — where

the waterfall is, that is, start the clearing in the area where the

water is no longer a problem when it goes over the falls. If they can

make some arrangements with other developers or other people in the

area, I would like them to continue that policy of clearing the creek

all the way back so that we don't have water moving faster and flooding

other homes in that area. To me it seems very straightforward, but

somehow, in the bureaucracy, it doesn't seem to work from either an

engineering point of view.... We can start clearing, but why start

clearing in the middle? If you're going to start clearing — which I

think should be done — start at the bottom end and work up the creek,

so that this coming winter no one is going to be faced with the large

amount of water that is coming off some of the developed areas and

causing a continual problem.

I talked about this for the first time in 1952, Mr. Chairman, and it

has taken a long time to move somebody in this ministry to look at the

problem and do something positive and constructive. Now they've done

something positive. They have accepted some offsite work. But I think

the positive work is being done in the wrong spot, and I would like

some comment from the minister.

The fourth issue I would like to bring to the minister's attention

is, again, something I have brought to his attention by letter; I've

also sent letters to the Minister of Consumer and Corporate Affairs

(Hon. Mr. Hewitt). It's the problem that when subdivisions are allowed

to be developed, both the Ministry of Highways and various other

ministries have some rules and regulations that a developer must

conform to. One of the rules is that any roads must be built within a

standard that is acceptable to the Highways ministry. Another one of

the regulations that they have to conform with, supported and enforced

by Consumer Affairs, is that before any of the lots can be sold to the

general public, a prospectus must be filed with the Ministry of

Consumer and Corporate Affairs, and in that prospectus there are

certain agreements that are proposed to have been made. In this case it

is the prospectus of the Westland Industrial Park Ltd. pertaining to a

subdivision in the Metchosin area and running off Happy Valley Road. In

the prospectus that was filed with the ministry,

section 13 says:

"Access is from Happy Valley Road, Metchosin, British Columbia. Roads

are completed and gravel surfaced to Department of Highways standards,

and all costs in this regard have been borne by the promoter herein."

I've brought this fact to the attention of the Minister of Consumer

and Corporate Affairs and his predecessor. In this particular case the

access road, that is approximately 14 miles closer to Victoria, has

never been completed to Highways standards in the subdivision. The

local road is known as Lindholm Road, and somewhere along the line the

Highways ministry would not accept the grade on it and consequently

they will not maintain it. Somewhere down the line.... I believe this

was after the prospectus was put out, but not before the majority of

the people who are living in that particular subdivision bought and

built their homes. Somewhere down the line, if I can accept that the

minister's letter to me is correct, another subdivision approval plan

must have been okayed. The other road.... Reading from a letter from

the minister: "I think there has been a misunderstanding. The

subdivision was approved with public road access off Kangaroo Road

only. The road you refer to, which runs from Happy Valley Road to the

easterly end of Lindholm Road, is a private road." When that particular

subdivision was okayed with an access to Kangaroo Road, which, as I

say, adds approximately 10 to 14 miles to the access to Victoria.... I

think somewhere down the line there is a responsibility of the

government to uphold the prospectus that was filed with the Minister of

Consumer and Corporate Affairs which led to a lot of people building

and buying in that particular area.

I find interesting a letter that I received from the office of the

Minister of Consumer and Corporate Affairs, dated April 13, 1983. In it

he states:

"It would appear that the main access to the

subdivision is indeed from Kangaroo Road, rather than from Happy Valley

Road, as stated in the prospectus. According to the developer, it was

intended to bring Happy Valley Road up to Department of Highways

standards, but financial troubles prevented this from being done. The

developer has advised that he has done some work on the road to bring

it to a reasonable standard and intends to meet Department of Highways

requirements within the next few months."

Interjection.

MR. MITCHELL: Who signed it? Do you want me to read it out and put it on record?

AN HON. MEMBER: Please do.

MR. MITCHELL: At that time I imagine you were out

campaigning, because it was signed "for James J. Hewitt" by Jill

Bodkin. To keep the record straight, I did say "from the minister's

office." I was not going to embarrass you that you

[ Page 4083 ]

were not here to do your job on that particular date. I know where you were.

This is the problem that I'd like to bring to the minister's

attention. The Minister of Consumer and Corporate Affairs got up here

yesterday and asked for something like 16 miles of road for one

particular event that's going to happen in his riding. I'm asking, Mr.

Speaker, if the 200, 300 or 400 feet of this road could be brought up

to some standard of highway construction and be paved. The road is in a

deplorable state. The public uses that road, and it destroys the cars.

According to my informants, the highway department is one of the

greatest offenders of taking a shortcut from Happy Valley Road through

Lindholm Road and through the subdivision to other parts of the

community. They're not going to go around and add another five or six

miles to their trips. I don't blame them. When I'm in that area, I go

up the road. One of the main problems is that the main access from the

Metchosin volunteer fire department, and the closest access, is up

Lindholm Road. If there is a bush fire or a fire in a home in that

subdivision, the fire department will have problems getting up that

road, which is in a deplorable condition.

I don't want to make it political, but when the last campaign was

on, certain strong supporters of the government said that if the people

voted for the Social Credit candidate, that road would be fixed. I know

I can't hold the minister responsible for those statements, but I do

think that we have a moral responsibility to the community. Hundreds of

thousands of dollars have been spent in that subdivision. It's less

than a quarter of a mile, I believe, that needs correcting on that

road. We can give access as was promised in the prospectus when people

bought their land and built their houses. I ask the minister to give

serious consideration and not play little games with bureaucracy. Let's

get it straightened out. I promise not to bring it back again if it's

corrected. Next time I will thank him for doing it.

One minor question I would like to ask the minister is: what is the

type of sealer they use when they do a sealcoat, before they put

pebbles on the road and prior to doing a sealcoat for black topping? I

have had a number of complaints which I took to the previous regional

manager. One case was the road going into Willis Point. They put a

sealcoat down and then put down the pebbles. I was being led to believe

that the sealcoat that they're using is a water-based oil emulsion. If

the sun is not out and it happens to rain, it keeps the emulsion in a

liquid state. Cars continue to be covered with tar, which causes an

awful problem for the owners to clean off. I also had a similar

complaint on the spray used on the Millstream improvement before

putting down the blacktop. The spray got wet and it was tramped in and

out of all the houses. A lot of the business people in the community

were complaining, because people who walked through it were tramping

oil into their stores. In fact, a few stores had signs up asking people

not to come in with tar.

I was wondering if the minister could answer whether there is any

policy on the type of emulsion used. Is there a difference? I've been

given conflicting stories, Some say that neither the oil-based sealer

or the water-based sealer will seal fast enough, and it may still come

off the road. There is an argument, and I've had conflicting statements

on it. I ask the minister if he could give me some answer through his

deputy. Is it possible that the water-based emulsion, which I think was

designed for green cement in foundations, could be not used, as it

destroys a lot of people's homes and messes up their cars?

[2:45]

HON. A. FRASER: To the member, back to front, we have a lot

of trouble with sealcoat jobs wherever they are. Nobody is satisfied

except the engineers, and they're really satisfied because sealcoating

doubles the life of pavement. I might say that the motorists offend

terrifically on any jobs we do: they don't pay attention to the signs

posted to drive at certain speeds, and away goes their windshield and

everything else, and then they sue us for that. We try to control the

sealcoating jobs. Everything is posted, but the drivers don't pay any

attention at all. They go right through and away goes their windshield

and headlights and they blame us for it, The end result of any sealcoat

job just about doubles the life of pavement. I don't want to get into

the emulsion part, as we haven't an engineer here at the moment to

answer the question right away, but we have a lot more problems than

just that with each sealcoat job, and we continue with them. We also

try and get the best weather, and we don't always get the breaks there,

which can do a lot of harm to a sealcoat job.

You lost me on the subdivision, but we'll look into that access road

where one prospectus shows Kangaroo Road and the other Happy Valley or

Lindholm Road. I understand from my deputy that it is our road, and I

don't see why it has to be in the condition you say. If it's a

maintenance problem, we'll look into it and correct it.

You mentioned drainage. As far as our ministry is concerned, we are

responsible for the drainage of the highway system, but we're not

responsible for the whole area. If you're in a municipality, they look

after that, and in the member's area there is the regional district.

Our responsibility for drainage is to the highway right-of-way, but not

all over the place and away from the highway system.

We are going to look into the Port Renfrew maintenance and see what

we can do there. I believe we had three or four people there. We are

taking them all back to Sooke, and we will try to operate out of Sooke

for economic reasons. We will take another look at your request, which

is to have some representation in Port Renfrew.

I heard the member talk on the Whiffin Spit the other day.

Unfortunately I don' t know where it is, but I think we're back in the

same position there that we can't work on a place that isn't on the

highway right-of-way. I don't think the Whiffin Spit is on the highway

right-of-way. It is illegal to spend money on anything away from the

highway right-of-way. I don't know whose responsibility it is, but it

wouldn't be ours if it isn't in the highway right-of-way.

I would like to reply to the questions that the member for North

Island (Mr. Gabelmann) asked late last evening. We are looking at the

charge on bicycles on Highways ferries. The member's other question was

the Tahsis-Woss proposed road being endorsed by the Vancouver Island

municipal association. Our engineers don't agree with that, but we

appreciate the observations they've made. We are basically talking

about $30 million to build a different access road from Tahsis to Woss,

and not get the use of it for probably four or five years. We want to

upgrade the existing road which goes from Tahsis to Gold River so that

the people would get immediate benefit from that. We are still at odds

there, but we appreciate the observations which were made.

I think that covers most of the questions which were asked.

[ Page 4084 ]

MR. MITCHELL: It is not for me to tell the minister what is

described as a highway, but I think if he checks the Motor Vehicle Act,

the subdivision act and roads and highways, even a bike path, a walkway

or a bridle path can be classed within the subdivision as a highway. I

don't happen to have the particular regulations with me, but I know

that if you are doing a subdivision you can have access, so it doesn't

have to be a highway. At Whiffin Spit a lot of people walk down the

access to the park area. The government granted $30,000 from the

Lottery Fund to the chamber of commerce just before the election in

1979 to have work done on that particular area. Some of that money was

spent on enlarging the parking lot. I really think the Highways

ministry, for everyone's sake.... Let's not play little games and say:

"Well, that's not my department." It is a problem out there. For you,

Mr. Minister, and those who don't know where Whiffin Spit is, it goes

right across and protects Sooke Harbour.

As far as Port Renfrew, I thank the minister for looking over the

shutdown again. I wonder if he would agree to have a year's

postponement while they study it again and listen to some local input

from the volunteer fire department, the ambulance crew and the

community association. Get some dialogue — that's what we hoped to get

when the committee came down from Port Renfrew to meet with the

minister — on how they view it. If you can have a year's extension

while you have that dialogue, I know the whole community would

appreciate it.

We talked about Bilston Creek, which you say is not the problem of

the Highways ministry. This is the argument you've been giving me for

the last five years. I accepted that. The Capital Regional District

accepted that. They were accepting the responsibility. But the Highways

ministry has now given one developer an opportunity to do some off-site

work in Bilston Creek. If you are going to give a developer the

opportunity to do the off-site work so he can get his subdivision

through, all I'm asking is that you co-ordinate the work so it starts

at the bottom and works up. If you're not going to do any work or put

any money into it, I can accept that if that's the policy; but if the

Highways ministry is allowing someone to work in there, I think they

should take the responsibility to co-ordinate it. I don't want to see

one

section of it cleared out, and a lot of water come down and flood

out some of the people who are living below the area that is going to

be cleared out; that that particular area will be twisted and clogged

up and they will be flooded. All I'm asking is that the ministry

co-ordinate it and do something positive on it. And if they look at

Lindholm Road they will solve it. I hope the next time we have

estimates I'll be here to thank him.

Vote 62 approved.

Vote 63: administration and services department, $10,213,139 — approved.

Vote 64: highway operations department, $461,206,535 — approved.

Vote 65: hydro development — highway construction, $10 — approved.

Vote 66: motor vehicle department, $28,035,515 — approved.

Vote 67: Motor Carrier Commission and branch, $2,627,154 — approved.

Vote 68: transportation policy department, $5,695,879 — approved.

Vote 69: air services branch, $5,228,694 — approved.

Vote 70: Crown corporation assistance, $55,807,700 — approved.

The House resumed; Mr. Speaker in the chair.

The committee, having reported resolutions, was granted leave to sit again.

HON. MR. BENNETT: Mr. Speaker, I ask leave to make an introduction.

Leave granted.

HON. MR. BENNETT: In the gallery today is a very welcome

guest of mine, my mother, and her — I was told to say this — much

younger sister, Mrs. Helen Morrison, and friends Milton and Helen

Kendrick. I'd ask the House to welcome them.

HON. MR. SCHROEDER: I call second reading of Bill 8, Mr. Speaker.

[3:00]

PARTNERSHIP AMENDMENT ACT, 1984

HON. MR. HEWITT: I rise to move second reading of Bill 8,

Partnership Amendment Act, 1984, which I have reintroduced in this

session with strong support, I might add, from the legal and business

communities. Since last fall when I first introduced the bill, we have

had an opportunity to make some refinements, basically of minor

administrative nature, that clarify some of the procedures in the

original bill.

Limited partnerships have always had a strong potential appeal to

investors for tax reasons and for the attraction of limited liability,

but under previous requirements any change to the structure of a

limited partnership — in fact its very formation — required the

signatures of all partners. This meant it was often impractical to set

up or operate ambitious, limited partnerships involving a large number

of individuals. By removing the requirement for such documentation, we

have streamlined this legislation to a point where it will now be

feasible for many investors to participate easily and without undue

bureaucratic intervention. It will also be possible, providing other

provincial statutes are complied with, to sell limited partnership

units on the Vancouver Stock Exchange so the average citizen may also

participate in this investment approach.

I envision that this amendment will have a particularly positive

impact on the resource development sector of our economy. As the hon.

members are aware, the process of rebuilding industrial plants requires

a heavy capital expenditure with virtually no prospect for short-term

profit. If the tax incentives fall into place, as they well could for

many new, limited partnerships, development costs could be taken as tax

deductions right away. Accordingly, this change to our partnership

legislation should have the effect of producing

[ Page 4085 ]

jobs by encouraging investment in our resource

sector. Whether or not a particular partnership would be eligible for

such tax advantages will have to be determined on an individual basis

in consideration of the specific partnership, its organizational

structure and its method of doing business.

A moment ago I mentioned the necessity for compliance with other

provincial legislation. To ensure protection of the public, the

superintendent of brokers will require that the prospectuses for

limited partnership adequately inform investors of their rights and

limitations. The superintendent, in conjunction with the Vancouver

Stock Exchange, will also determine whether or not limited-partnership

units could be listed on the exchange and what regulations and

requirements would apply.

Another advantage of this amendment is that by facilitating the

mechanics of creating and running a limited partnership, it will ease

the administrative burden on our companies office. For example, each

limited partnership would maintain its own records of participation in

the operation, a procedure which will reduce the filing workload in the

companies office.

Finally, this is not a first in Canada or on the North American

continent. Other jurisdictions in the United States and Ontario have

similarly lifted administrative restraints from their partnership

legislation, with notable success. Implementation of such legislation

here in British Columbia will, I believe, prove particularly

beneficial, given the strong resource base in our economy.

With those remarks, Mr. Speaker, I now move second reading.

MR. D'ARCY: We in the opposition will be supporting this bill

and concur in the remarks of the minister. I would like to make the

point, though, that while the bill does bring the Partnership Act in

line with the Securities Act and other legislation in the province, I'd

like to reiterate the oft-voiced concern that we have for modernization

and an upgrading of the Securities Act itself. I would hope that when

that happens any need for upgrading the Partnership Act will be taken

into account.

We note that in some aspects, especially the.... I won't call them

silent partners, but inactive partners in a partnership have less

protections than they had before. We don't object to that on this side

of the House. I would think that anyone who enters into a partnership

in British Columbia is in a situation where he has a piece of

legislation to form the partnership that does conform to legislation

elsewhere. If there are not the same checks and balances that were

there before, perhaps that could well be each partner's problem to deal

with in terms of the articles of incorporation.

I would concur that as long as the public interest, the investment

community's reputation in British Columbia and our province's

reputation as a good place to invest are protected, there is no reason

to have a lot of bureaucratic checks and balances on a partnership. We

certainly have no objection to partnerships of this nature being listed

on the stock exchange. We would hope — I think all of us in here hope —

that there will be some benefit, not only in the resource sector but

also in other areas of endeavour within the province of British

Columbia.

HON. MR. HEWITT: Mr. Speaker, in rising to close debate, I

would comment that we recognize the need for protection of the public

and the investor. I wish to inform the member that regulations with

regard to the filing of prospectuses and the adequate informing of

prospective investors will be maintained in this regard, dealing with

limited partnerships as with companies with respect to filing

prospectuses, etc. With those comments, Mr. Speaker, I move that the

bill now be read a second time.

Motion approved.

Bill 8, Partnership Amendment Act, 1984, 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. SCHROEDER: Mr. Speaker, I call adjourned debate on second reading of Bill 2.

INCOME TAX (HEALTH CARE MAINTENANCE)

AMENDMENT ACT, 1984

(continued)

[Mr. Strachan in the chair]

MRS. DAILLY: Mr. Speaker, we have heard from the Minister of

Finance (Hon. Mr. Curtis), who introduced this bill, We also listened

to the Minister of Health (Hon. Mr. Nielsen) take

part in the debate on

this bill. I regret that he's not in the Legislature at the moment. In

debating this bill, I find it necessary to repudiate many of the

statements made by the Minister of Health in his attempt to support

this increase in income tax.

My primary concern with this bill and the concern of the

opposition.... We are, of course, opposing this bill; this was already

brought forward by our Finance critic, who spoke at length on this

bill. We are opposed to this bill for a number of reasons. The first

reason is that we do not feel that this bill is necessary. It has been

brought into the House under the guise of saying to the people of

British Columbia: "Look, we need more money for health because of that

terrible federal government, which is not treating us properly."

References have been made to the new Canada Health Act, which is

apparently the guise being used to increase taxes on the people of

British Columbia. That is our first reason for opposition to this bill.

We do not believe that this bill is necessary for the delivery of

health services in this province, as has been stated by both the

Minister of Finance and the Minister of Health. I would like to go into

that in some detail.

I'd like to point out that the first part of this bill is the 8

percent surtax, which is to go into effect in mid-year. This year it

will bring approximately $97 million into the coffers of the treasury.

If the bill is passed and imposed on the people, it is estimated that

it will collect an estimated $166 million annually. That's a lot of

money to take from the people of British Columbia at this time when our

economy is in such recession. If health care and medicare were indeed

in the crisis that the Minister of Health and the Minister of Finance

are trying to tell the people of British Columbia, then perhaps we

would have to look at this, even though most people today agree that to

add taxes onto the public in a time of recession is absolutely the

wrong thing to be doing if you want to come out of it. I can back up

that statement by saying that if we look at the United States, whose

economy is certainly much better than ours at this time.... Although I

deplore many of the policies and the philosophy of their government, we

have to ask why the United States is not

[ Page 4086 ]

suffering quite the same recession that Canada and

particularly the province of British Columbia is suffering, which we

know is one of the worst in all of Canada. If we look at Canadian

political history of the last year or perhaps two years, we see that

there has been a history of adding taxes onto the consumer,

particularly in the province of British Columbia. Tax upon tax is being

imposed: increases in sales tax, you name it. Everywhere you look there

are more taxes being put on the people of British Columbia. Now we have

another one.

It's an interesting thing to note that many economists have pointed

out that the road to recovery does not come from imposing more taxes on

the consumer. So from that point alone we can see that in the United

States some economists have suggested — and I would hope that the

Minister of Finance would perhaps reply to this point — that one of the

reasons for the difference in the increase in their employment and

general economy at this particular time is that they have not imposed

the same number of taxes as both our province and Canada. I'm only

posing a theory that has been stated by a number of economists. I know

that other economists might repudiate that theory, but I personally

feel that, at this time, putting more taxes on the consumer is simply

withholding more opportunity from the consumer to spend in our province

and therefore to help the whole chain of recovery.

I say to the Minister of Finance: surely he can see now that his

policy of more taxes is simply not going to help this economy. When you

think that these taxes are being imposed primarily, so we are told, for

the sake of maintaining health care in this province, one really has to

ask: "What is this government all about?" I contend that this is not

needed for the health care delivery system at this time in the province

of British Columbia. That is the point that we must all realize.

I think it is causing great confusion to the public of British

Columbia, who at this time are receiving — and I know the Minister of

Finance must be well aware of this — in the mail.... Whether this is a

correct thing for a federal government to be doing to a provincial

government is something that I'll leave for another discussion. But the

point is, this is a message regarding the new imposition of this new

tax that is going out from the federal government to all the people who

receive anything from the Department of National Health and Welfare.

People have written me letters, and they've included this. I want to

point out that I am not yet quite in receipt of this senior

citizen's....

AN HON. MEMBER: Prove it.

MRS. DAILLY: Don't ask me to prove it yet. I was kindly given

it by someone else. Apparently it is going into the mail with the

pension cheques.

What is it basically saying, and why has the federal Minister of

Health decided that this step is necessary? In this pamphlet that's

going out, they point out, step by step, that there is no need to blame

the federal government for this increase in health tax in B.C. If the

Social Credit government of British Columbia had not taken it upon

themselves to usher in this new tax, based primarily on an attack on

the federal government and their new Canada Health Act, I'm quite sure

that this would not be appearing in the envelopes of people who receive

pension cheques. It is because the federal government obviously doesn't

feel that they should have to sit back and take the blame for the

imposition of a tax on health when they do not see that they are

responsible for it.

I'd like to read to you an excerpt from this note that's going out in pension cheques in British Columbia:

"Your provincial government recently proposed a new temporary

tax called a health care maintenance tax that will increase your personal income

tax 8 percent by January 1985. It says this tax is necessary because the federal

government is cutting back on payments for medicare. If the province wants to

raise your taxes, that is its privilege. But we want to make it very clear that

the federal government is not cutting back on medicare. Our contributions to

medicare in B.C. are determined just as they are for the other provinces, and

our share has been about the same since 1975. That means $1.1 billion in total

for this very fiscal year 1983-84. Next year it will be 9.3 percent more...."

I understand that relates in round figures to about $100 million extra, coming clearly above inflation.

"Don't be fooled by an attempt to blame the federal

government for a provincial tax increase. How can one explain a

provincial increase of $166 million" — and obviously they're referring

to the annual increase which this tax will bring in — "when the maximum

possible penalty to B.C. for user fees would be $35 million and when

British Columbia intends to go on collecting these revenues from user

fees?"

[3:15]

I am not an apologist for the federal government, but I am here to

try to find some reason and rationale for the government of British

Columbia imposing a new health tax on the people of British Columbia.

You can imagine how the citizens of B.C. who receive this feel. Here

they have a federal government telling them, "We're not to blame for

this tax, " while on the other hand they have the Minister of Finance

(Hon. Mr. Curtis) and the Minister of Health (Hon. Mr. Nielsen)

standing up in this House and saying, "We have to bring in this tax

because of that awful federal government and their new Canada Health

Act." I think that the people of British Columbia deserve a straight

story on the finances of British Columbia.

In closing this debate I hope the Minister of Finance will relate to

the points that I've made here regarding the issuance of this letter to

the pensioners in British Columbia. I hope he has some answers, because

I am receiving letters from people in British Columbia who say to me:

"Hey, what's going on? Who's right and who's wrong?" I have to say to

those people that my only opportunity to find out is to bring up these

points in the Legislature to the minister who brings in the bill. I

hope that we'll be given some real facts pointing out why this tax is

necessary.

May I point out some of my own reasons for this tax being brought in

by the Social Credit government at this time. As I said earlier, I

don't think it has anything at all to do with health. The only reasons

that I can think of are either to once more sock money away for the

next election so that once more there are some goodies to hand out, or

the government, because of their overextension in a number of areas

such as the B.C. Rail, B.C. Hydro and the ALRT, are in such a mess that

they simply have to find more ways of raising money. Which is it? There

has to be some reason for this increase in tax at this time. I'm

pointing out to whoever's listening at this time that nothing points to

the need for this, as far as health goes. It would be great, I suppose,

to have unlimited sums of

[ Page 4087 ]

money for health. In the brief time that I've had

this role as Health critic, with the bit of studying and reading I've

done and talking to various people, including our former Minister of

Health for the NDP government, I don't happen to believe that just

pouring endless sums of money into any ministry is the answer for

complete and better services. But I do say that this government has no

right to be putting this tax on Health at a time when we're told by the

federal government that they have not put this government in a position

that's as desperate as they claim to be in.

I'm concerned that the Minister of Health, in supporting this

increase, says nothing. Even if, let us say, they were in a crisis

situation, as they're trying to assure us — and which I don't happen to

endorse — why doesn't the Minister of Health do everything within his

means to find and approve of alternative ways of health delivery, which

could perhaps ease some of the cost burdens we're facing today? That is

an area that we could go on at great length about, and I intend to do

so in much greater detail during the Health estimates.

On to the actual business of this tax we're dealing with at this

moment. I would like to quote from Dr. Robert Evans, a well-known and

very respected economist from UBC, who I believe is quite conservative

on many things. I think he is a conservative economist. Do you know

what he said, Mr. Speaker, when he appeared before the Standing

Committee on Health, Welfare and Social Affairs, which was studying the

Canada Health Act? May I quote some of the statements Dr. Evans made

before the committee? On being asked about the fact that B.C. was

raising taxes, ostensibly to cover impending deficits in Health and to

cover the withdrawal, perhaps, of the user fee moneys, he said that to

the extent that there is a deficit in B.C., perhaps it's a result of

world economic conditions. He asked us to also remember that

"...B.C. Railway and B.C. Hydro are building well ahead of demand.

Everybody said it was doing so at the time, and they did it anyway. B.C. Transit

commission, the northeast coal problem.... The Japanese have decided that

since they're not building cars, maybe they don't need so much coal.

We have a whole series of projects which are imposing serious costs on the British

Columbia government. They are looking around for a way to justify the increased

taxes to support earlier mistakes...." This really is an important statement

Dr. Evans has made. After he states that they are looking around for a way to

justify the increased taxes, he concludes: "Medicare, being the most popular

program in British Columbia, as in the rest of the country, makes a natural

stalking-horse for those taxes." That is from someone who is not sitting

here in the Legislature, not a member of this caucus, known to be a fairly conservative

economist. He is stating what we state, that this tax is not needed as a health

tax. As far as the opposition is concerned, to even stand up here and suggest

that it's needed for health is almost an insult, not just to the opposition

members sitting here, but to the people of British Columbia, who are being told

that that nasty federal government, with their Canada Health Act, is causing

this increased health tax. That's pretty disgraceful.

It's a pretty disgraceful move on the part of any government, and a

pretty cynical move, to bring in a tax purporting to deal with needs in

health care, when nothing that we can see backs up those needs. As a

matter of fact, even the Minister of Health, when he was questioned on

the day the bill was brought in, kind of shrugged and said: "Well,

maybe some of it will have to go into general revenue." Why not be

straightforward, honest and upfront about it and call it what it is?

It's another income tax on the people of British Columbia, for whatever

purposes this Social Credit government wishes to use it. This is the

point that really concerns me and many other people in the province at

this time. It's a pretty callous move.

We look at the second tax, which is primarily going to be placed in

case of the holdback in penalty for user fees. There again we have said

over and over that this whole matter of user fees should never be here.

It's strange. At times the ministry will say: "We don't raise that much

money from user fees, but it is a great deterrent to stop people from

abusing our hospitals." Mr. Speaker, almost everyone will say, in

answer to that: "Give us examples of where user fees are a deterrent,

and give us facts and figures to show that they stop people actually

abusing medicare and the privileges of a hospital." There isn't anyone

on that side who can back that up with facts, but it's a very

convenient way to try to get more money from the people of British

Columbia.

I read very carefully again today the remarks of the Minister of

Health when he spoke in the debate. He said, re this tax bill, and re

the Canada Health Act, which is now going through the House of Commons,

I believe, backed up by the federal Conservative Party, as well as the

other two parties, of course: "Not only" — and he's referring to the

federal government — "do they wish to be involved financially, they

want to run the whole program. They've introduced

an act which in

effect tells the provinces how the program is to be run, and if it's

not run their way, they're going to withdraw their share of the

funding, or a portion of it." That is sheer nonsense, Mr. Speaker. The

Canada Health Act, which is being used as a guise to get tax money for

the provincial revenues. Is not telling the provinces how to run the

whole show. What it's doing is trying to uphold the basic principles of

medicate. It is simply saying that medicare is based on five basic

principles. If any province does not live up to those principles in any

form whatever, then they have to take action, because they are saying

we cannot allow medicare and its principles to be eroded by policies of

provincial governments.

We in the NDP have pointed out to the B.C. Social Credit government

for a number of months now, and years, that their constant increases —

for instance, from the dollar-a-day acute care costs to $8.50 a day,

which is a 300 percent increase — are a complete abridgement and cause

an erosion of the medicare principle. That's all the Canada Health Act

is saying. They're saying that "if we're going to have an erosion of

the principles of medicare, then we are forced to take action to ensure

that those principles are not eroded." That's what they're doing with

their penalty. Their penalty is given three years, and it gives an

opportunity for the government, if they wish, to come out of the usage

of these fees. The B.C. government should never have found itself in

that position. And I say, Mr. Chairman, that the constant use of these

premiums and user fees is definitely an abridgement and an erosion of

medicare. I'm quite aware that the NDP, when they came into office,

inherited this. And in our three years, along with many other things,

we certainly didn't increase them to the extent of the Social Credit,

which is now $8.50 a day. Our future policy was completely committed to

the elimination of these user fees and premiums so that nobody in this

province

[ Page 4088 ]

Mr. Chairman, the whole matter of user fees is something which we say is a

complete erosion of medicare, and we say. "Hear! hear!" to the federal

government for finally stepping in and saying: "Hey, unless you, as the

province of British of Columbia, abide by our regulations as to the use of user

fees, we will have to impose penalties, because you are eroding the principles

of medicare." I say "Hear, hear! " on that one thing alone. To

have this government come into this House with a bill which they say is there

primarily because of the dreadful things that the federal government is going

to do to them by this act is sheer nonsense. It is a fallacious argument. I

can't blame the federal government for realizing that the time has come

to take some action in this area.

[3:30]

May I remind you that the federal Conservatives also support this. I

find it very interesting that the Minister of Health (Hon. Mr. Nielsen)

keeps saying: "Well, maybe everything will change after the next

election." Is he implying that the federal Conservatives, if they

become government, will go back on their commitment to medicare? Their

leader has already announced that he is committed to it? I think the

Minister of Health certainly should explain that statement. The whole

area of this bill, not only the 8 percent surtax but the inclusion of

another one which will be negotiated with the federal government if

they're able to eliminate user fees.... Apparently the Social Credit

government also wants to bring in a new tax. Any unneeded tax on health

is bad enough, but when you look at this new tax that is going to be

based on the whole matter of families, it becomes even more burdensome

and unbelievable. That this government would bring in another tax, one

that they apparently can make their own decisions on in cabinet....

We don't need to get into that too much, because our main contention

in this bill is that it is not needed for health at this time in

British Columbia. We are saying to the Social Credit government that we

think you owe it to the people of British Columbia to give a straight

answer on this bill. You have the numbers. You will probably drive this

bill through, but at least drive it through with honesty.

MR. COCKE: Mr. Speaker, if the bill before us weren't such a

serious matter it would be one of the biggest jokes played on the

people in the province of British Columbia in a long, long time. The

government puts forward a bill and names it the Income Tax (Health Care

Maintenance) Amendment Act, 1984. What a crock! This is an 8 percent

increase in our taxes in this province, to be put in the general

revenue fund to support anything that the Minister of Finance (Hon. Mr.

Curtis) and his colleagues on the Treasury Board feel is the way to go.

Interjection.

MR. COCKE: "Not so," the minister says. That incompetent

group over there couldn't handle a peanut stand. And it is so, Mr.

Minister. This is the most ridiculous caption I've ever seen on a bill,

and I've seen some pretty stupid ones in the last eight years.

HON. MR. CURTIS: Control yourself, Dennis.

MR. COCKE: I will control myself at my leisure. In the

meantime, I will tell you how I feet about this bill, this piece of

hypocrisy. Mr. Speaker, not only do they provide for an 8 percent

increase in the tax, but they are going on to provide themselves with

an ongoing behind-the-closed-doors-of-cabinet method of gouging us some

more — all in the name of health care! I sat here very quietly,

patiently listening to the Minister of Health talk about fifty-fifty

sharing and how the feds have backed out of it. Oh, let me read you

some of his comments. "At one time it was generally assumed or

believed, perhaps improperly, that it was to be done on approximately a

fifty-fifty basis." He went on to say that across Canada the old

concept of 50 cent dollars is still discussed. The federal government

has attempted to impose their will upon the provinces, etc. I would

just like to take that little piece and shove it down the minister's

throat. Unfortunately he wasn't the minister when the negotiations were

going on. The Minister of Labour now (Hon. Mr. McClelland) was then

Minister of Health.

Let me tell you a little bit of the history of this thing, because I

started in those negotiations in 1972. The federal government came

along and said: "What we would like to do, dear sirs — Health ministers

and Ministers of Finance of the various provinces — is tie our

contribution to the percentage increase in the gross national product."

We just said to poor old Marc Lalonde.... And at that time I think it

was the guy who is now running for the Liberal leadership — Turner or

something like that.

MRS. DAILLY: No, Turner was Finance.

MR. COCKE: Well, it was the Minister of Finance and the

Minister of Health. I'm not sure if it was Turner then, because there

were so many of them.

But anyway, Marc Lalonde was then Minister of Health. Oh, what

arguments we had. We said, "Look, what you're doing here is stating

that you're going to back out of the fifty-fifty concept," and we in

British Columbia hung right in there. We said: 'Absolutely not." As a

matter of fact, I remember one time when my colleague who is now Leader

of the Opposition — he was then Minister of Finance and I was Minister

of Health — and I were down there, and he gave a phenomenally good

speech about the injustices of that sort of thing.

But something else occurred. There were two beautiful little stars

in our crown in Canada: Ontario and Alberta. They wanted to go down

there and wheel and deal. Do you know what they were prepared to do?

They were prepared to give away the keys to the kingdom by going down

there and saying: "Give us some tax points and a couple of little

grants, and we'll buy your deal," The feds jumped right in there, but

we hung in and said: "Absolutely not." Because the rich provinces with

the good, solid tax bases such as Ontario, British Columbia and Alberta

would be just fine on that new suggestion; Saskatchewan was coming

along, but the Maritimes and Manitoba would have been absolutely tubed.

So again we argued and said: "Don't give up the fifty-fifty

relationship" — that the present Minister of Health extols.

[Mr. Speaker in the chair.]

But guess what? When the NDP lost the government, there was a new

Minister of Health and Minister of Finance, and they went down there

and gave away the keys to the

[ Page 4089 ]

kingdom, because they agreed with the Alberta and

Ontario concept and said sure. Because you know what, my dear

colleague? We then had a beautiful tax base, and it looked like that

would be the road to greater riches. The problem with that road to

greater riches is that the Socreds ran us into the ground, and now our

tax base isn't worth near what it was then. Now they're howling their

heads off and saying they would like to go back to fifty-fifty. I bet

you'd like to go back to a lot of things. Why did you agree with it in

the first place? The fact is that they did, and then they have the

audacity to come in to this House with a bill like this, which calls

itself the Income Tax (Health Care Maintenance).... At least they had

the good sense to put it in brackets. It's there nonetheless, and it is

just a travesty.

The two aspects of this bill that I cannot buy are calling it a bill

to support the health care system — other than that awful little piece

in there that for every dollar they have to cut down their user fees,

there will be a dollar on the backs of our taxpayers. That is one

thing, and the other is what they're trying to tell the public — and

successfully, I would think. These guys are probably the greatest

propagandists since Goebbels, but in any event....

HON. MR. CURTIS: Order, order!

MR. COCKE: What's wrong with that, Mr. Speaker? I can't name

anybody else, but if you can think of better ones, well, then tell me.

Doug Heal and his little band of lost Socreds....

Anyway, that was the whole question, as far as I was concerned. I

just don't agree with calling something what it is not. The minister

wants a tax increase. Why does he want a tax increase? He wants a tax

increase so that they can look good and keep out of the red as much as

possible, but what they don't realize is that every move they make is

one that further reduces our economic standard in this province. They

fire a whole bunch of people, so there's a bunch more people on

welfare, whom the rest of us have to support through one means or

another; there's a reduction in the economy. They drain funds from the

taxpayers' pockets by this piece of legislation; again, there's a

reduction in the economy. They talk about doing things for the private

sector that will make the private sector start to be the engine of our

economy. What do they do every time? They hit the private sector right

on the nose. I'll bet you that a lot of them in the private sector will

keep voting Socred. For the life of me, I can't understand why they

would vote for those odometer experts. As far as I'm concerned, they

should be thinking about what this economy needs. It needs an

injection; it needs some help; it needs somebody with leadership.

Instead of leadership, we've got a government that's dragging us down

deeper and deeper into the mire. Can you imagine the minister having

the heart to bring this in, when 15.5 percent of our people in this

province are unemployed. It's worse than any other place in Canada,

except Newfoundland. Imagine that — Newfoundland, which was always felt

to be the have-not province in Canada. It was always hoped that

Newfoundland would come up and join the rest. They're coming up at a

better rate than we are; in fact, we're going down while they're going

up. It's time they gave some leadership, not this kind of foolishness.

In their naming of this bill, the Goldfarb experts decided in

consultation that that would be a good name because they could get away

with a tax increase by calling it just that. I hope every person in

this province gets a chance to really analyze this piece of

legislation. The first

section is an increase in tax. The second

section is a health care maintenance levy. This is the part that is so

offensive: it gives the cabinet the right to impose further taxation

without even coming back into this House to debate it. They won't even

debate it with their back-benchers. They can do it by going to a

cabinet meeting. Do you know what the quorum is for a cabinet meeting?

Do you remember? It's two. The Premier and his Minister of Finance

could go in there, sign an order, and that order would say that the

people of British Columbia are going to pay more taxes — without

debate, without a word to the folks out there.

Interjection.

MR. COCKE: I'm not going to comment on that too much. That

member raised a very interesting question. One time, when he was the

Attorney-General and in charge of the liquor board, and he was away, my

colleague the member for Nanaimo (Mr. Stupich), who was then the

Minister of Agriculture but also acting Minister of Finance — and I was

acting Attorney-General.... We two got together and raised the price of

beer. When my colleague got back, there was heck to pay.

Getting back to this bill, we have a piece of legislation here that

should never pass this House. When this kind of legislation goes

through, the assembly drops just a little bit in terms of how

thoughtful people feel about us collectively. We shouldn't be doing

things like this. We should call a spade a shovel, or at least a spade.

We should call it an increase in tax, period. We should not be calling

it something that it is not at all. It's just deceitful. It's the kind

of thing that, I think, tends to make politicians suspect. We shouldn't

be doing that to ourselves. The protection of democracy is the most

precious thing, as far as I'm concerned. Every time politics or

politicians go down a bit in anybody's estimation, that's a step in the

wrong direction. This is one of them, because that's not what it's

talking about at all. What it's talking about is getting the minister

that increased amount of money. If only they had stuck together when

they were doing their negotiating in Ottawa some six or seven years

ago, we probably wouldn't have this problem now, in terms of user fees

versus no user fees and so on.

[3:45]

I want to bring something to the attention of the House for a

moment. My colleague was saying that when we were government we didn't

raise user fees. That's quite right. At the outset of hospital

insurance there was an imposition of $1 per day, and the former Premier

Bennett, one of the architects of that plan, felt that it would be

something so that people made their little contribution and recognized

the importance of the service they were getting. It was never intended

to go beyond that. We maintained that all the time we were government.

However, we've seen it increase and increase to the extent that it has

become a real factor. Since we're not the only province, the feds

decided to go the route of locking the provinces in. I agree with my

colleague, the member for Burnaby North (Mrs. Dailly), that from the

standpoint of the Department of National Health and Welfare in Ottawa,

they're not trying to run the show. They're saying they make a major

contribution, so they should have something to say about the financing

of the program and, naturally, the principles in terms of the basis for

the whole program.

[ Page 4090 ]

We oppose it; we will continue to oppose it; it has no pluses that I

can see. But it is playing on human emotions when we have articles like

this in our paper: "Only the fittest will survive in the future, says

the chairman of the ethics committee of the Canadian Medical

Association. It's quite simple: sooner or later we're going to run out

of money." If we run out of money for health care, it's because we are

not sharing the responsibility for it; we are not looking for the

alternatives that are necessary in order to keep it in line with our

ability to pay; we are caving in to the doctors; we are caving in to a

system that has become expensive, I admit, but a system that could be

streamlined to the extent that it would be comfortable for us. I've yet

to hear anybody — either here in our own socialized kind of system or

in the United States — say that they're not prepared to pay their share

of the costs of this priority area.

We oppose it. It's improperly named, and it is an improper piece of

proposed legislation that is put before us today. I can say no more.

MR. BLENCOE: I don't have much to say or see much to commend

this piece of legislation. I would basically reiterate much of what the

member for New Westminster (Mr. Cocke) has said. Suffice to say that

this bill really does play on the emotions of British Columbians,

trying to intimidate them by saying that it's got something to do with

health care in the province.

British Columbians today are very concerned about their health care

system. They have continued to see the system erode over the past few

years; they continue to see many of their hospitals not supply the

services they had expected. Many elderly people in their last few

years, hoping and wishing that they would be entitled to full and

proper health care after giving many dollars to taxes over the years,

find that many hospitals are not equipped to take care of their

problems immediately. We all know of the horrendous stories that come,

and that I continue to hear at least twice a week in my riding, of

various hospitals here that don't have enough beds or incredible

waiting-lists for all sorts of surgery. Calling it a health tax bill

really is a gross misuse of the term "health." It has nothing to do

with health at all. A better term for this bill would be the Northeast

Coal Subsidy Act.

We know exactly why this bill has been introduced. We've seen the

government continue to squander money on projects such as the northeast

coal deal and the BCR, and that's why we've seen nearly half a billion

dollars in one year go off to take care of part of the incredible debt

that has been built up in the north over the coal deal. The government

thought they could put this one over on the people of British Columbia

and squeeze it through this Legislature by tacking on the word

"health." It is basically another huge increase in income tax for

British Columbians, to bolster up the fiscal irresponsibility of this

government over the last few years, and I think British Columbians are

beginning to recognize that. It's unfortunate that the government, in

trying to foot the people of British Columbia, had to use the word

"health" and play on the emotions of British Columbians, who are indeed

concerned about their health care system and would say: "Well, if this

money's going towards health, it must be all right."

We've heard minister after minister say that it's got nothing to do

with health. The Finance minister and various other people can't get

their stories straight. It's an income tax bill, an 8 percent surcharge

on all British Columbia income taxes, to be paid by all taxpayers. At a

time when we are trying to see a consumer recovery in this province, to

once again hit the hard-earning British Columbian with increased taxes

under the guise of trying to help health is really totally

unacceptable. It should be called what it is. It's an insidious piece

of legislation. It's a northeast coal subsidy act; that's what it's all

about. The government should have the honesty and forthrightness to

tell the people of British Columbia why they introduced this bill. It's

got nothing at all to do with health.

As a matter of fact, what we're seeing is this government get into a

wrangle, for political reasons, with Ottawa over the very issue of

health. This is a way of trying to blame the federal government,

through the back door, as being responsible for this 8 percent

surcharge, and not the Social Credit government. That's what they're

trying to tell the people of British Columbia. But it won't wash. This

is a British Columbia income tax bill. It's to pay off those huge debts

that they've mounted up north over coal. Every economist, of any

political persuasion or economic theory, is saying it's a bad deal for

the people of British Columbia. I really wish the government had the

honesty to tell British Columbia what it's all about. It's an income

tax bill. They can't afford it, and it's just to bail out other

problems they've created for this province on the financial side.

The other thing which is really quite incredible — and I suspect

they thought it would slip through — is that

section 2 allows the

Lieutenant-Governor-in-Council to increase the health care maintenance

levy at will, without reference to the Legislature. It is the

Legislature that has always had the authority to increase taxes, but

section 2 of this particular bill flies in the face of that tradition.

It's the Lieutenant-Governor-in-Council that will have the power to

increase this levy if it so desires. That, of course, is totally

unacceptable. It violates all the principles of bringing tax bills

before this House. But I suppose it's in keeping with the current

direction of this government.

We adamantly oppose this bill. It uses health to force further

income tax on the province of British Columbia, and it really is a

rather insidious piece of legislation. To use people's emotions and how

they feel about health to try to rationalize increasing income tax by 8

percent in the province of British Columbia is totally unacceptable,

and I as one member am totally opposed to this piece of legislation.

MR. LOCKSTEAD: I won't be long.

AN HON. MEMBER: Good.

MR. LOCKSTEAD: We'll see you later — bye. Where's my grant, Provincial Secretary? I want a big one.

HON. MR. CHABOT: For what?

MR. LOCKSTEAD: For my constituency, for Powell River, for health care....

HON. MR. CHABOT: For your constituency office?

MR. LOCKSTEAD: Oh, yes, you can double that one — travel

expenses. Sorry, Mr. Speaker, back to the bill here. But I just can't

help answering the interjections across the floor from the Provincial

Secretary. I often enjoy them, and I'll bet you any money that I will

get that lottery grant for my riding.

[ Page 4091 ]

HON. MR. CHABOT: What for?

MR. LOCKSTEAD: I've written you a letter.

HON. MR. CHABOT: Mariculture?

MR. LOCKSTEAD: That's a good idea.

This bill deals basically — and it's serious business with an 8

percent increase in our income tax charged at the provincial level,

under the guise, as the previous speaker mentioned, of maintaining our

health system in British Columbia. That's a misnomer in this case. The

fact is, and the minister himself has stated, that the revenues

collected under the.... Is it $169 million a year?

HON. MR. CURTIS: No.

MR. LOCKSTEAD: How much is it? It's $96 million the first

year, but on a year-round basis it's almost $166 million. Over a

five-year period a total of some $830 million will be collected. No way

will the health care system require that funding. Even if the federal

government imposes the penalties that the Minister of Health says may

be imposed — and they may not ever be imposed on this province — it

would only amount to about $36 million a year.

The reason I got to my feet at this particular time is just to have

it on record that we know very well where the overrun, the extra

taxation, the moneys that will be going into general revenue will be

expanded. The government has put in some $470 million this year to pay

off B.C. Rail's debt, which they didn't have to do, at the expense of

health care, education, social services, legal aid and what have you,

here in British Columbia. We know very well that the government is

going to use this money raised through this 8 percent increase in the

provincial portion of the income tax to subsidize northeast coal and

other government projects, which we were told were going to pay for

themselves. The taxpayers of this province haven't got a hope of ever

getting any of those revenues back, particularly on the northeast coal

transaction.

The Minister of Industry and Small Business Development (Hon. Mr.

Phillips) admitted in this House last year, after months and months of

questioning — I think it was a year and a half — that we would have to

sell at the current price 15 million tonnes a year out of northeast

coal in order to break even. The point I'm making is that....

[4:00]

HON. MR. CURTIS: On a point of order, Mr. Speaker, while it

may not serve the purposes of the members opposite, this bill has

nothing whatsoever to do with northeast coal or southeast coal or with

highways or bridges. It has a lot to do with the cost of health care.

MR. SPEAKER: Hon. member, the Chair has allowed some

latitude. I'm sure the member appreciates the restrictions on second

reading. I ask the member to address those concerns.

MR. LOCKSTEAD: I understand very well. My purpose in getting

to my feet here was not to discuss the northeast coal situation, which

we will have an opportunity to do shortly. I am trying to put on record

where I think a large proportion of the funds received from this

overtaxation will be going. I would ask the minister, when he closes

debate, where this extra funding is going to go if not into subsidy of

northeast coal. Is it going to go to ministerial travel around the

world? Is that where the extra money raised under this tax is going to

be going? I don't know; I'm speculating. Perhaps in closing debate the

minister will tell us. I don't have much more to say on this. Obviously

I'm going to vote against this horrendous tax increase. It's

unjustified. It will hurt the economy of British Columbia. It will

reduce consumer spending in the province, not only hurting the people

themselves — the worker, the wage-earner and anyone with a taxable

income — but also the small businesses in every community in British

Columbia. This is gross taxation. It is totally uncalled for. I hope

that some of the back-benchers on the government side will see the

light and vote against this bill, which is totally unrequired at this

time,

One last item: had the government done its job properly in terms of

collecting revenues from the sale of our logs and trees in this

province, they wouldn't have had to bring in this bill.

MS. BROWN: I would like to add my support to the comments

just made by my colleague from Mackenzie, who has sat down, and say

that even though the title of the bill says it's an income tax

amendment to deal with health care maintenance.... In fact, the

Minister of Health (Hon. Mr. Nielsen), when asked about this on

February 21, said that there is no guarantee at all that this tax would

be spent on health. He went on to say that it would be poured into

general revenue, which means that it can go to any area of government.

I am pleased to hear the Minister of Finance say that that's not so.

I hope he was saying that the entire $97 million which he says he hopes

to raise by this tax in the first year and the $166 million annually

will in fact go to pay for health care maintenance. If that's the case,

there will be no need to have a user fee. In fact, people will not be

deterred from having access to our hospitals and other health

institutions based on their inability to meet that user fee. I

disapprove of this tax, because I think that during a time of high

employment when the economy is in as bad shape as it presently is, for

the government to add another tax onto the already overburdened

taxpayers of the province certainly goes counter to everything that

members on that side of the House have ever said. Very simply, it's an

increase in the provincial income tax. Changing the name or putting in

brackets that it's for health maintenance doesn't alter that fact. A

rose by any other name smells precisely the same.

We know it's an increase in provincial income tax. It couldn't come

at a worse time. It's coming at a time when we are told that recovery

is going to be led by consumers, but consumers in British Columbia are

not consuming; they're not spending any money at all. Surely one of the

reasons has to be that they're concerned about the increase in taxation

which is spelled out in this bill. In one

section of the bill the

government gives itself the right to increase the tax even further

without bringing it to the floor of this Legislature, without making it

open to public scrutiny or to public debate. For those two reasons, Mr.

Speaker, I would certainly like to add my voice in opposition to this

income tax increase legislation.

The minister stated that some of the money from this tax would go to

help pay off any penalty based on their refusal to obey the Canada

Health Act and not permit extra billing in this province. That's

penalizing the public twice. What that says to the patient is, first

you are extra-billed and then you're

[ Page 4092 ]

extra-taxed to pay the penalty for the fact that we

as government permit extra-billing. There are two penalties; the

patient is taxed twice when the patient should not be taxed at all. The

Canada Health Act outlaws extra billing. If the government were obeying

the law they would not permit extra billing and patients would not have

to pay that extra money, but because the government may choose to break

the law, the patient will have to pay the extra on top of whatever is

covered by the medical plan, and in addition they are burdened with

this 8 percent increase in their provincial income tax to help the

government pay the penalty which would be levied on it by the federal

government by virtue of their breaking the law.

There are all kinds of issues and all kinds of ways in which the

Minister of Health could find it within his power to deal with the

health needs of the province, without using the power of the Minister

of Finance to add an additional tax burden on the people of British

Columbia. Clearly that has not been explored, for the reasons outlined

by the Minister of Health himself when he said that this tax would be

going into general revenue. That's the real reason why the Minister of

Health is permitting the Minister of Finance to get away with this. The

tax is going to raise far more money than the Health ministry will need

for its own use. The Minister of Health goes on to say that once it's

in general revenue, the government is free to use that tax in any way

they see fit.

It seems to me that the straightforward way to deal with it would

have been simply to refer to it as the Income Tax Amendment Act, 1984,

and not try to pretend that it has anything to do with health or health

maintenance, and allow and permit us to debate it on the grounds that

what we have before us is an increase in the provincial Income Tax Act.

If that were allowed, Mr. Speaker, we could then talk about the

unfairness of increasing taxes at a time when the rest of the country

is experiencing a recovery and we here in British Columbia continue to

find our unemployment and bankruptcy rates escalating, and our

consumers refusing to spend any money or to contribute in any way to

any kind of economic recovery in this province. But we're not permitted

to debate it on that level, because of the pretence that somehow this

piece of legislation has something to do with paying for health costs

and dealing with health care maintenance. Of course the lie is put to

that by the Minister of Health himself when he says that it will be

poured into general revenue, which means that it can go to any area of

government.

The Minister of Health did not disagree with the suggestion that up

to half the revenue raised by this method would be directed away from

health care. If the Minister of Finance is really committed to the

concept and belief that this increase is necessary to meet health

costs, since the Minister of Health says that half of the amount of

money raised will be enough, maybe we'll be seeing a new amendment

cutting that 8 percent down to 4 percent. I don't know if that's

possible, and hopefully when the minister closes debate he will

indicate that there has been some consideration given to reducing the

percentage increase in view of the statement of the Minister of Health

that an 8 percent increase is not necessary to meet the health care

costs of the province.

[Mr. Pelton in the chair.]

In any event, Mr. Speaker, along with my colleagues, I would like

to.... Oh, there's a new Speaker, a nice Speaker. I would like to add

my words, in support of my colleagues, in speaking specifically on

behalf of a constituency which is very hard-pressed and is which faced

with a lot of unemployment and, as I said before, alarming increases in

bankruptcies — a really tight money situation all around. Speaking on

behalf of Burnaby-Edmonds and its residents, I want to say how opposed

I am to any increase in the provincial income tax at all, and certainly

to this one which gives the government powers to continue to increase

taxes from time to time without bringing the matter before this House,

so that at least we would have an opportunity to scrutinize and debate

it on the floor of the House.

MR. MITCHELL: Mr. Speaker, I know I am going to tread a very

fine line of being out of order, so I'm going to warn you now, but I

would like to zero in on one issue. But before I do that and you start

to challenge what I'm saying, I have to go on record as saying that I'm

opposed to this bill for a number of reasons that have already been

stated by my colleagues. To save you who have been sitting in this

chamber all this time and hearing all the arguments, I won't repeat

them.

[4:15]

I would like the minister in closing the debate to give some

explanation of the terminology in a

section in the bill which refers to

a taxpayer and the number of dependants he has. What I really think he

is attempting to do — and I know we'll get into this in committee stage

— is to get around a premium based on the family. If we're going to

work on an income tax basis, and the bill states that it is an income

tax bill, we must keep an income tax bill based on income. When you

refer to the number of dependants in a piece of legislation, all of

that is taken into consideration when a person's income is established.

If you are going to establish the taxable income of a person, based on

his dependants, family, tax deductions or anything else, you can't

sneak in.... I think this is the deceptive part of this piece of

legislation. Under an income tax bill, you are trying to sneak in a

section that establishes something that is maybe properly allowable

under a premium-based bill, which is provincial legislation. Somehow,

when I read that section.... I won't refer to the

section because I

know you will rule me out of order, but I know the minister is aware of

it. How can he justify that particular

section which is going to take

into consideration not only a person's income, but the number of

dependants? I think that is out of order in an income tax bill. I think

it's out of place. I hope that the minister, in closing debate, will

cover that particular

section before we get to committee stage.

HON. MR. CURTIS: It is with interest that I have listened to

remarks from members opposite on the day the bill was first called for

second reading, and again this afternoon.

I wonder if I might have leave to make an introduction, Mr. Speaker.

Leave granted.

HON. MR. CURTIS: I recognize that the member for Okanagan

North (Mr. Campbell) would perhaps prefer to do this, but I note in the

gallery this afternoon — for the last few minutes at any rate — a

friend of many on both sides of the House, Mayor Pat Duke of Lumby.

Mr. Speaker, Bill 2 contains important amendments to the Income Tax

Act that have one purpose, and one purpose only: that is, to enable the

province both to cope with a declining

[ Page 4093 ]

federal share of provincial health costs and to

respond constructively and firmly to the challenge of the Canada Health

Act. Reference has been made today to the remarks which I offered on

February 20, budget day. May I restate, in closing debate for second

reading — and let there be no doubt — that the federal share of the

cost of providing health care services in B.C. was 44 percent in

1977-78. I think we agree on one other aspect: that that was the first

year of the Established Programs Financing arrangements.

Then came years of relative noticeable documented decline. The

federal share sank to a low of 37 percent in 1982, and currently stands

at 39 percent. These continuous federal shortfalls have put the

province — and other provinces, as my colleague the Minister of Health

(Hon. Mr. Nielsen) observed last Friday — in the difficult position of

having to devote more and more of its own financial resources in order

to maintain a high quality of health care and a high-quality health

care system — about which none of us in this chamber, I would think, in

spite of other differences, would disagree — but having to maintain

that in the face of rapidly rising health costs. Health care

expenditure made up 29 percent of provincial spending in the 1977-78

fiscal year. Large increases in health spending over the past several

years have led to a 1984-85 fiscal projection where 37 percent of

provincial spending is allocated to health care — from 29 percent to 37

percent in the space of a relatively few years. Clearly a situation

such as this cannot be allowed to continue untouched and indefinitely.

Faced with the relatively declining contribution to provincial

health care costs, the government has introduced the health care

maintenance surtax in Bill 2 as a necessary and constructive initiative

to help satisfy the need for increased provincial funding of health

care programs. Some concerns have been expressed about the surtax.

Again, I think it is vital that all observers and participants

understand that there are two completely separate issues in this bill.

But with regard to the surtax, there have been suggestions made by

members opposite — and by some of our citizens — that the tax will add

to the increasing burden being placed on individuals by all levels of

government. In the budget and in the debate, this side of the House —

government members — indicated clearly that we are vitally concerned

about the total tax burden being placed on individuals in B.C. So when

we were developing this particular and essential measure we took steps

to ensure that the personal income tax rate in British Columbia, even

after this proposed change, will remain the second-lowest among all

provinces in the nation.

Again this afternoon we've heard the charge that the bill has

nothing to do with health care insofar as revenues raised from the

surtax go to consolidated revenue — the CRF. Let there be no doubt: all

moneys collected by whatever tax measure is introduced or carried on by

this or any government go to consolidated revenue fund and are then

disbursed. This money will flow to consolidated revenue and will then

be spent solely for the purpose of maintaining the high quality of

health care that we enjoy and consider to be our right in the province

of British Columbia. But in order to get to the health expenditure

area, the money must pass through consolidated revenue.

We've also heard that the bill is, according to some

interpretation,

not necessary, in that the increase in the federal contribution to

health care in 1984-85 exceeds the increase for provincial health

expenditures in the same year. I don't think it is correct. I don't

think it is useful or helpful, if one is objective about this area of

expenditure — these program expenditures — to look at just one year,

because that can give an erroneous impression. Such a comparison fails

to note the long-run trend, Madam Member for Comox, of federal health

funding...

MS. SANFORD: What did I do?

HON. MR. CURTIS: ...and its relation. The member interjected

the other day that that wasn't correct, and so I remembered that and

wanted to draw her attention to it, Mr. Speaker, through you. No

offence.

AN HON MEMBER: Just letting her know you were listening.

HON. MR. CURTIS: I was listening, indeed.

The comparison fails to note, if it's taken in the short term of

snapshot, that we have a steady decrease in federal funding toward

health care. There is clearly a demonstrable evidence of federal

underfunding, and on that we rest the case of the province of British

Columbia.

Somewhat repetitious now, Mr. Speaker, but between 1977-78 and

1984-85 provincial health care expenditures have increased at an

average annual rate of 15.2 percent. By comparison, the allocation

under EPF to B.C. by the federal government for health care increased

by an average of only 12.9 percent per year. If that isn't a decline,

then I don't know what is.

The second measure contained in this bill — separate and distinct

from the first — is the direct response to initiatives contained in the

Canada Health Act. The health care maintenance levy was imposed to deal

not with the issue of federal underfunding of health care, but rather

with the threatened — indeed one must say now the apparently imminent —

imposition of a reduction of EPF transfer moneys in respect of hospital

user fees in several provinces where they are used.

British Columbia would have preferred, and still prefers this

afternoon, to retain what we believe to be modest hospital user

charges, because these have played a valuable role in our health-care

system for over 30 years. They have been designed so as not to hinder

the access of those British Columbians who have low or lowest income,

not to impede or interfere with their access to our hospitals and to

our health service. That is a fundamental premise upon which we have

operated since we formed government in 1975-76. But the levy has been

introduced as a positive alternative to these charges. The government

remains convinced that the overriding federal-provincial health issue

is federal underfunding. It also acknowledges that the solution to this

problem will only come about as a result of the constructive dialogue

between the federal government and the provinces on this very important

topic, combined then with a joint commitment by both levels of

government to resolve the funding share issues. So I restate what was

said earlier, without reflecting on a vote: that the province of

British Columbia, my colleague the Minister of Health and I, along with

other ministers of health and finance and provincial treasurers across

the country, seek that kind of a meeting about which the Minister of

Health spoke just a few days ago — a meeting of federal and provincial

ministers of health and ministers of finance — in order that we can lay

out on the table all of the

[ Page 4094 ]

problems and determine precisely where and how the funding of health care in Canada and in British Columbia should be going.

I restate this afternoon that very sincere and straightforward

proposal, that when the two federal ministers concerned are ready to

meet — whether all other provincial ministers can attend or not is

beside the point — my colleague and I will be on an airplane within a

matter of hours.

We've also had the major concern expressed with respect to the fact

that the bill gives wide-open authority for the government to do

whatever it wishes with the income tax system, including the rate of

tax. The rate of provincial income tax is legislated in the act under

section 3(5), and a change in that rate would require the approval of

this assembly. The health care maintenance levy is and should be,

viewed strictly and narrowly, as the replacement of one set of fees

with a levy administered through the income tax system. I stress that

as a result of this initiative either the current health care user

charges would be retained or a health care maintenance levy would be

imposed. The user charges and the levy will not be in effect

simultaneously. That is not the purpose. If we are permitted to

continue with the modest user fees we have had in this province for

three decades or more, then the question of a user levy as contained in

this bill will simply not be proceeded with. It's that simple, and I

state that again in this chamber.

The absence of specific details in the

section dealing with the levy

is something we cannot help, because it is a direct result of a lack of

precise figures on which provincial user fees will be subject to a

federal penalty. So we cannot spell them out in this legislation unless

and until they are spelled out by the government in Ottawa.

Reference was made to Monique's missive, the little slip of paper

which is appearing — the member for Burnaby North (Mrs. Dailly) spoke

of that today — in old age security cheques and, I am informed —

although our family has grown — in family allowance cheques. I have

seen a copy, Madam Member, and I am distressed.

[4:30]

Interjection.

HON. MR. CURTIS: Well, yours is in the mail. That's the family allowance cheque, Mr. Member, rather than the other one.

I am distressed that we have a federal Minister of Health who does

not understand the problem. That's worrisome; it really troubles me, as

a Canadian. If she wants to put little slips of paper in the cheques

dispatched from Ottawa to recipients of old age security and family

allowance, it is not for me to say that that's wrong or right. But we

have a federal Minister of Health who doesn't understand her portfolio.

As my colleague the Minister of Health (Hon. Mr. Nielsen) indicated

very clearly the other day, when one wants to talk about the cost of

health in Canada, she says: "That's Lalonde's problem." Some

responsibility on the part of Madam Begin, in something as critical and

as costly as health care in British Columbia! Let her continue to send

her slips of paper to Canadians and to British Columbians, most

particularly, but let her first start to understand the root cause of

health care costs in this country before she starts playing cheap

politics with the people of British Columbia.

I have a correction to make, and I'm sure the member for New Westminster

(Mr. Cocke) was mistaken. As I understand the fifty-fifty cost sharing with

the federal government, Ottawa did, as a matter of fact, back out of the fifty-fifty

agreement. The 1977 formula, amended in 1982, provided for growth in the federal

contribution at the rate of increase in the gross national product. The province

of British Columbia did not agree to the 1982 amendments, which sharply reduced

federal contributions. It is a matter of record that these were unilateral federal

actions which cut future growth in federal transfers. Therefore I simply correct

the member, and he and I can discuss that some other time. He has his view of

it, but it is not correct to say that British Columbia permitted that to happen

or bargained it away in 1982. I simply wanted to make that observation.

There are two separate and distinct initiatives contained in Bill 2,

the health care maintenance surtax and the health care maintenance

levy, to deal with two distinct aspects of federal underfunding, as

well as the Canada Health Act's proposed penalties against those

provinces which have user charges. I think the people of British

wisdom behind this action and, indeed, the necessity for this dual

approach. At stake is nothing less than the continued vitality of a

health care system in this province and in this country in which all of

us take a great deal of pride.

Mr. Speaker, I move second reading of Bill 2.

[Mr. Speaker in the chair.]

Motion approved on the following division:

YEAS — 25

Chabot

Nielsen

Gardom

Curtis

A. Fraser

Davis

Kempf

Brummet

Rogers

Schroeder

Heinrich

Hewitt

Richmond

Ritchie

Michael

Pelton

Johnston

R. Fraser

Campbell

Ree

Segarty

Veitch

Parks

Reid

Reynolds

NAYS — 15

Macdonald

Howard

Cocke

Dailly

Lauk

Nicolson

Sanford

Gabelmann

D'Arcy

Brown

Lockstead

Mitchell

Passarell

Rose

Blencoe,

Division ordered to be recorded in the Journals of the House.

Bill 2, Income Tax (Health Care Maintenance) Amendment Act, 1984,

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 3, Mr. Speaker.

HOTEL ROOM TAX AMENDMENT ACT, 1984

HON. MR. CURTIS: As was announced on budget day, Bill 3 provides a new tax rate of 7 percent on sales of

[ Page 4095 ]

accommodation in hotels and motels in the province

of British Columbia. Recently the rates of tax under the Hotel Room Tax

Act were 6 percent on accommodation selling for less than $50 a day,

and 8 percent on accommodation which charged $50 or more per day. The

new rate is expected to increase revenues by approximately $200,000. It

is primarily being implemented this year to simplify the collection of

the tax by the hotel and motel industry through having a single tax

rate. The change in rates with this legislation takes place March 1,

1984. Implementation was delayed until March 1 from budget day to

enable the industry to have a little more time to make changes to their

accounting systems and cash register equipment used in collecting this

tax. That was something of a departure from the usual imposition of a

tax change. It was apparently quite well received by this particular

industry. It may be possible to use similar delayed notice in some

other tax measures in the future, but I make no commitment in that

regard.

The bill also provides a transitional provision under which a refund

of the tax will be made to those persons who had committed themselves

to purchase accommodation prior to midnight February 20, who would

therefore have paid a 6 percent tax rate but now would be paying 7

percent. Those who made such a commitment and who can provide simple

documentation to the consumer taxation branch of this ministry, by way

of a confirmed reservation, written contract or a receipt for a deposit

made on account for a specified number of days' accommodation to be

purchased on or after March 1, would be covered by this arrangement and

would be refunded the I percent difference in tax. A similar

arrangement is in place for those who purchase accommodation selling

for $50 or more per day after February 20. Obviously they wouldn't

require a refund. The hotel operator would charge these purchasers 7

percent on their purchase of accommodation after March 1, regardless of

when the initial reservations or arrangements were made. It is

realistic that due to the high cost of evaluating and processing refund

claims, and issuing refund cheques, refund claims under this provision

will be processed only when the refund of tax due to the purchaser is

$10 or more.

In

summary that is the purpose of Bill 3, Hotel Room Tax Amendment Act, 1984, and I move second reading.

[4:45]

MR. COCKE: This is an interesting little bill, Mr. Speaker,

which raises $200,000. However, when you think in terms of those who

can afford to pay the $50 plus for their hotel room having a reduction

of 1 percent, and those renting hotel rooms at under $50 paying 1

percent more, the $200,000 represents an awful lot more than that on

the backs of the people who are renting the less expensive rooms. I

couldn't even make an estimate. It strikes me that the Minister of

Tourism (Hon. Mr. Richmond) should be up arguing with respect to this

bill. The industry likes it from one standpoint, and that is that it

makes it simpler to keep their books. I'm speaking on behalf of the

people, not the industry, in this particular situation. But I think,

all in all, what we should be doing is thinking in terms of making it

less expensive for people to come to British Columbia and spend their

dollars in our fine province. Instead of that, we're continually taxing

people to death in British Columbia.

There is no question that the bill has a bias. The original act

which said that hotel rooms under $50 were 6 percent and hotel rooms

over $50 were 8 percent, took into consideration the fact that the

people renting the $50-or-less rooms could certainly afford to pay as

little tax as possible. This bill says: "Okay, let's put them all on

the same basis." Everybody pays 7 percent. And the government, of

course, gleans an additional $200,000. But the people staying in those

rooms which were formerly taxed at 8 percent — and there are a lot of

hotel rooms that are far more than $50 a night in this province — have

suddenly had a net reduction in their bill, which has to be put on top

of this whole thing. We know that there has been quite an exchange of

funds. We think that 1 percentage point is very little. But when you

think in terms of the number of hotel rooms in our province, one

percentage point is a significant sum. It is, however, one percentage

point going both ways. It is the rich getting richer and the poor

getting poorer in good old Socred style. It never fails, Mr. Speaker.

Take the heat off the friends and put a little bit more on those who

can less afford it.

I'm not sure what I would have done here. I would like to see hotel

room taxes eliminated, from that standpoint. I sometimes wonder,

however, if the hotels in our province don't price themselves just a

little bit lavishly from time to time, judging by charts I've seen

comparing our region to others with similar characteristics — I say "

similar" because nobody can match B.C. The only thing we've got saving

us, in terms of the whole tourist industry, is the fact that we've got

the most beautiful province to sell, and even at that we're having real

difficulty.

I have to vote no for this bill just on principle, because it

doesn't act even-handedly in terms of the way it treats people. It is

saying to those in the most fortunate class, "We're going to give you a

reduction in your hotel bill," and to those in the less fortunate

class: "For the most part, we're going to give you an increase." What

the minister could have done is brought the whole thing down to 6

percent. Then, of course, there would have been a net loss to the

Crown. But no, they didn't do that. They did it the other way, and they

increased the ones at the lower level.

I haven't a great deal more to say. I don't think there is a lot you

can say about a bill like this, other than to ask: who can support it?

It's unfair. The Speaker is getting jittery and so, with that, I

suggest that the opposition says no to Bill 3. I know that comes as a

great surprise and shock to the government. But then on the other hand,

it may be that the government is going to have to vote on this bill

too, and they're going to have to say to some of their constituents,

those who are somewhat worldly and embrace fair play as a principle:

"Well. I voted for this bill. I just forgot about you for a minute or

two." It’s on your conscience. We're voting against it.

HON. MR. RICHMOND: I wish to add a couple of very brief

comments on this bill. I am pleased to support it, as is the entire

hospitality industry, who have been asking for it for some time. Not

only does it make their task a little easier in bookkeeping, as the

member for New Westminster pointed out, but it takes a lot of confusion

out of it as far as the visitor to this province is concerned. It was

difficult for them at times to explain the two-tier system of taxing.

It also added confusion when a visitor had been quoted a rate of, say,

$46 or $48, and he showed up with a wife and a couple of kids, which

put him over the $50 bracket. All of a sudden the tax jumped two

points. I think it is good for the tourism industry. It takes all the

confusion out, as I've said.

[ Page 4096 ]

I would like to point out to that member who likes to harp about

taking from the poor and giving to the rich that it will make a

difference of 40 cents on the average person's $40 hotel room. We're

talking about a difference of 40 cents a night — and taking all the

confusion out of the industry. When he says that he doesn't know what

he would do, I think that is typical of most of those over there. They

have all of the complaints and criticism but never any of the

solutions. As for the idea of making it 6 percent, I don't think that

would be proper, because everything else in the province is taxed at 7

percent.

I commend the bill, as do most of the people in the hospitality

industry, Mr. Speaker, and I would like to go on record as supporting

it fully.

MR. D'ARCY: Mr. Speaker, I wish to say a few words on behalf

of the hospitality industry in my constituency. I would like to have

the Minister of Tourism know that the hospitality industry there does

not favour this bill. We have a growing destination resort industry.

Also, the hospitality industry has for years catered to the travelling

public and the business travelling public in British Columbia, and they

are not happy about this tax increase. It's an additional 1 percent on

what they're charging people who come in from outside the area — from

across the line, from the Spokane area to ski — and people who come

into the area on commercial and tourist visits from within the province.

I can't speak for the industry elsewhere, but I strongly suspect

that, in spite of what the minister says, they're not very happy about

it either. Sure, if I had a hotel where I was charging in excess of $50

a room per night, I would be happy about any tax reduction. But if I

was charging less, I would not be supporting a tax increase.

Quite frankly, I think the bookkeeping change is balderdash. If

we're to accept that argument, perhaps the Minister of Finance is going

to come in next year and tell us: "Well, we've decided to make the

sales tax 10 percent because it's easier to figure." Everybody would

love that, wouldn't they? I doubt that that would be a good reason for

it.

So, Mr. Speaker, I speak against this change. It is an imposition on

both the commercial traffic and the tourist business in my

constituency. I don't believe it's fair. There have been arguments put

throughout this entire nation, not just in British Columbia, about the

level of taxation on the service industry and the tourism industry. In

the last few years Social Credit has increased property taxes at a

faster rate than property taxes have increased on other types of

property. Social Credit has increased liquor taxes, along with the

federal Liberal government, at a faster rate than the rate of

inflation, which has impacted once again on the hospitality industry

and the tourism industry. Social Credit has added a restaurant tax on

the hospitality and tourist industry, taking it from zero to 7 percent.

Now they add another tax affecting hotel and motel room rentals in my

constituency. I am opposed to it, and I think it is high time Social

Credit stopped providing disincentives to the tourism and hospitality

industry, not only in Rossland-Trail but in the entire province of

British Columbia.

MR. REYNOLDS: Mr. Speaker, I have just a few words. In

listening to some of the members of the New Democratic Party talk about

this bill that the minister has brought in, it upsets me to hear the

member for New Westminster (Mr. Cocke) say the rich get richer and the

poor get poorer. Yet in his own speech he said he's not sure what he

would have done in the area, and said that this government doesn't act

"even-handedly." This tax does act even-handedly, because it means that

every person who stays in a hotel room in this province will pay the 7

percent tax. That's an even tax for everybody.

The member for Rossland-Trail (Mr. D'Arcy) talks about the

imposition on commercial traffic in his area. I travelled through his

area when I first came to British Columbia, and I've stayed in many of

the hotels there. As he knows — and knows full well — anybody who is a

commercial traveler, their company is paying their bill; it's a

write-off on their federal tax as an expense of doing business and is

not going to interfere at all with whether or not they stay in a hotel

in his constituency.

I would suggest to those members of the New Democratic Party that

this is an even-handed bill. I don't think they've had one complaint

from any hotel owner in their constituencies. In fact, I had dinner the

other night with one of the hotel managers in the constituency of the

member for New Westminster, and he saw nothing at all wrong with this

bill. He thought it was going to save him a lot of bookkeeping and a

lot of paper work and would not affect his business one little bit.

Interjections.

MR. REYNOLDS: The New Democrats seem to have some problem

with people who write things off on their income tax. If you're a

commercial salesman, or anybody out selling a product, you have a right

to write off your expenses on your income tax. It's fortunate for the

people of this country that we don't have a New Democratic government

in Ottawa which would probably not allow anybody to write anything off.

Everybody would work for the government and everything would grind to a

halt. We'd be just like the Soviet Union tomorrow, because that's what

these people would like us to be.

This is an even tax and I'll be very proud to stand up and support it.

MR. HOWARD: The only thing that seems to have ground to a

halt is the reasoning, logic and rationale of the member for West

Vancouver–Howe Sound.

Mr.