2003 Legislative Session: 4th Session, 37th 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)

TUESDAY, MARCH 11, 2003

Afternoon Sitting

Volume 12, Number 11

CONTENTS

Routine

Proceedings

Page

Introductions by Members

Introduction and First Reading of Bills

Community Charter (Bill 14)

Hon. T. Nebbeling

Motor Vehicle Amendment Act, 2003 (Bill 17)

Hon. R. Coleman

Statements (Standing Order 25 b )

B.C. Interior Forestry Museum

W. McMahon

Kootenay storytelling festival

B. Suffredine

McDonald family independent power projects

B. Bennett

Oral Questions

Fair Pharmacare program income-testing model

J. MacPhail

Hon. C. Hansen

Affordability of assisted-living model

P. Sahota

Hon. K. Whittred

Regulation of barbers and cosmetologists

S. Brice

Hon. G. Bruce

Drug courts and mental health courts

L. Mayencourt

Hon. G. Plant

Gravel extraction from Fraser River

J. Les

Hon. S. Hagen

Future of B.C. Rail

J. MacPhail

Hon. J. Reid

Petitions

J. MacPhail

Committee of the Whole House

Budget Measures Implementation Act, 2003 (Bill 6)

J. MacPhail

Hon. G. Collins

K. Krueger

Reporting of Bills

Budget Measures Implementation Act, 2003 (Bill 6)

Third Reading of Bills

Budget Measures Implementation Act, 2003 (Bill 6)

Committee of the Whole House

Income Tax Amendment Act, 2003 (Bill 7)

J. MacPhail

Hon. G. Collins

Report and Third Reading of Bills

Income Tax Amendment Act, 2003 (Bill 7)

Committee of the Whole House

Auditor General Act (Bill 9)

Report and Third Reading of Bills

Auditor General Act (Bill 9)

Committee of the Whole House

Miscellaneous Statutes Amendment Act, 2003 (Bill 11)

J. MacPhail

Hon. G. Plant

Hon. R. Coleman

Hon. K. Falcon

L. Mayencourt

Report and Third Reading of Bills

Miscellaneous Statutes Amendment Act, 2003 (Bill 11)

Committee of Supply

Estimates: Ministry of Community, Aboriginal and Women's Services

(continued)

J. MacPhail

Hon. G. Abbott

Hon. L. Stephens

Second Reading of Bills

Unclaimed Property Amendment Act, 2003 (Bill 15)

Hon. G. Collins

Proceedings in the Douglas Fir Room

Committee of Supply

Estimates: Ministry of Transportation

Hon. J. Reid

K. Manhas

K. Krueger

B. Penner

D. MacKay

B. Lekstrom

D. Jarvis

P. Wong

[ Page 5417 ]

TUESDAY, MARCH 11, 2003

The House

met at 2:03 p.m.

Introductions by Members

Hon. T.

Nebbeling: Today I would like to introduce two gentlemen who are in the

gallery. These two gentlemen are here to be present when we introduce Bill 14 in

a little while. First is Frank Leonard, who is the mayor of Saanich. He's also

the first vice-president of the Union of British Columbia Municipalities and

chairs the Municipal Finance Authority of B.C. With him is the executive

director of the UBCM, Richard Taylor. I hope the House will make them very

welcome.

[1405]

Hon. G.

Campbell: I know that this morning the member for Vancouver-Hastings made

the announcement of the birth of a daughter to the member for Vancouver–Mount

Pleasant, but I think it is important today for us to remember that this is one

of the most joyful times anyone can have. I think we should all send our warmest

love and best wishes to Jenny Kwan and her daughter.

Mr.

Speaker: The Premier has a supplementary.

Hon. G.

Campbell: And her husband, Mr. Speaker.

MacPhail: Ah, those men — they're always trying to get in on it.

Thank you

to the Premier. Yes, I did announce it this morning. I talked to Jenny — to

the member for Vancouver–Mount Pleasant — about an hour ago, and they have

named their daughter Cee-Yan, and she's a beautiful, black-curly-haired young

woman.

I do note

that the same day that she was brought into the world, though, there was an

event — I don't know what you'd call it…. The member from Comox was also

brought into the world on the same day. I would call that a day of celebration

as well. Happy birthday.

Interjection.

Mr.

Speaker: I sincerely hope this absolves me of any responsibility.

Hon. C.

Clark: I'm delighted to be able to introduce two relatives who are in the

gallery today. We've all heard of economic refugees, and we've all heard of war

refugees. I would like to introduce some weather refugees from the cold town of

Sarnia: my Uncle Bill and Aunt Jenny Kapteyn.

Belsey: I have the pleasure today to introduce three people that are

visiting us from Prince Rupert: Mr. Bill Parmar, who is the president of the

Prince Rupert and District Chamber of Commerce, as well as the past president of

Rotary; his wife Anita; and his daughter Pamela, who is studying at the

University of Victoria. Would you all please join me in making them welcome.

Hon. G.

Plant: We are joined in the gallery this afternoon by some hard-working

folks from the legal services branch of the Ministry of Attorney General: lawyer

Laurie Solway; some articling students — Leslie Baskerville, Elizabeth Meyer,

Ann Roberts, Jeff Van Hinte and Aaron Welch; and two co-op students — Daniel

Morton and Simon Owen. They are here enthusiastically hoping that a little

democracy will break out on the floor of the chamber in the next few minutes. I

would ask all members to make them very welcome.

MacPhail: Today being quite an auspicious day, we're joined by an old

colleague of all of ours — a former colleague, not old: Corky Evans. Would the

House please make him welcome.

Lekstrom: Joining us in the House this afternoon are two friends of mine and

workers for the B.C. Coalition of Motorcyclists. They advocate on behalf of

motorcycle rights across British Columbia. Joining us today, we have Adele

Tompkins, who is the executive director, as well as Shannon McNeney, who is the

administrative coordinator. Will the House please join me in welcoming them.

Hon. R.

Neufeld: It's a pleasure for me to introduce to the House several people

that work with the Ministry of Energy and Mines, who are here today to receive

their commemorative medals for the Queen's Golden Jubilee. They are Ross Curtis

and his wife Loraine; Patrick O'Rourke; Gerald German; and Ron Smyth,

accompanied by his wife Ruby, his mother Lucy Smyth and his sister, Avril

Ridley. Would the House please make them welcome.

Stewart: Joining us today from Pitt Meadows, we have the chair of the

municipal insurance association. Would the House please make welcome councillor

Janice Elkerton.

Anderson: I would ask the House to join me in welcoming two distinguished

B.C. educators: Bob Lindsay and Stanley French of the B.C. Principals and

Vice-Principals Association.

[1410]

Christensen: Many members in this House will know my very hard-working and

capable constituency assistant, Min Sidhu. Another thing we all know is that

elections are about numbers. Not to be outdone, although my congratulations go

out to the member for Vancouver–Mount Pleasant and her family, my constituency

assistant Min on Friday, March 7 welcomed

[ Page 5418 ]

into the world her and her husband Sid's third daughter. It's my privilege to

welcome one of my newest constituents, Dilan Kaur Sidhu, who was born last

Friday.

Hon. G.

Campbell: Since we're celebrating today, I think it's important for us to

recognize that this is International Women's Week. It is important for us to

celebrate the contribution that women have made to our country, to our history,

to the society we live in — women in history, like Emily Murphy, Louise

McKinney, Nellie McClung, Henrietta Muir Edwards and Irene Parlby. The Famous

Five are memorialized in bronze on Parliament Hill in Ottawa for the

contribution they made in changing the status quo and making the world a better

place for all of us.

This is a

time to celebrate Mary Ellen Smith, who was first elected to this Legislature in

1918 and was indeed the first Speaker of this Legislature.

We can

remember the first woman mayor in Canada, Mayor Norah Arnold, from the city of

Prince Rupert in our great northwest.

Nellie

McClung is buried here in Victoria. I'm sure you'll all recall her motto, which

was "Get the job done and let them howl." She is now buried here in

Victoria, and her gravestone says that she is loved and remembered.

Of course,

it's a British Columbian who sits as the Chief Justice of the Supreme Court of

Canada, Beverley McLachlin. Here in B.C. the head of the RCMP E division and M

division is Beverley Busson. Of course, our first woman Lieutenant-Governor,

Iona Campagnolo, today sits in Government House and presides over our province.

It is

always important for us to remember the contribution of all British Columbians,

but this is a special time for us to recognize the contribution of the women of

this province who have made this such an exceptional place for all of us to

live.

Introduction and

First Reading of Bills

COMMUNITY CHARTER

Hon. T.

Nebbeling presented a message from Her Honour the Lieutenant-Governor: a bill

intituled Community Charter.

Hon. T.

Nebbeling: I move that Bill 14 be read now for the first time.

Motion

approved.

Hon. T.

Nebbeling: I'm pleased today to present the community charter. It's been a

long time in the making, and as a consequence of much work that has been done by

many stakeholder groups, we have created the most empowering local government

legislation in Canada.

Today we

are fulfilling our commitment in the New Era document regarding the

community charter by honouring a long-standing request of local governments. In

1991 the Union of B.C. Municipalities introduced the bill of rights for local

governments. The principles of this bill of rights have directed the creation of

the community charter.

From the

beginning of this legislative process we have worked with the UBCM and other

stakeholders. Their input was invaluable, as was the work of the Community

Charter Council.

We've also

received a tremendous amount of input from local governments, from business

sectors, from labour groups and from many individuals. The result is today's

community charter. It is concise legislation, balancing enhanced municipal

powers with increased public accountability. Local governments will have greater

autonomy to make decisions on the delivery of municipal services. This is for

the benefit of their citizens. Municipalities are in the best position to make

local decisions for their citizens and for their communities. They are the level

of government closest to the citizens, and the community charter reflects that.

[1415]

In short,

municipalities can be more responsive and proactive. With the community charter,

they are now active leaders in shaping the destiny of their communities.

Innovative local governments are key to a solid economic base for our entire

province. Strong local governments are key to the revitalization and economic

growth of British Columbia.

I move that

the Community Charter be placed on the orders of the day for second reading at

the next sitting of the House after today.

Motion

approved.

Bill

14 introduced, read a first time and ordered to be placed on orders of the day

for second reading at the next sitting of the House after today.

MOTOR VEHICLE AMENDMENT ACT, 2003

Hon.

R. Coleman presented a message from Her Honour the Lieutenant-Governor: a bill

intituled Motor Vehicle Amendment Act, 2003.

Hon. R.

Coleman: I move that Bill 17 be read a first time now.

Motion

approved.

Hon. R.

Coleman: A decision was made at open cabinet last November to transfer

ICBC's compliance operation department to government. Since the mandate of this

ministry is also public safety, it is a natural fit, and I am pleased that this

section is moving to the Minister of Public Safety and Solicitor General.

Compliance

operations enforces standards for commercial vehicle carriers, vehicle

inspection facilities and weigh scales. Its mandate is to reduce the instance

and severity of commercial vehicle accidents. The operation will become part of

our future integrated traffic

[ Page 5419 ]

enforcement strategy. The amendments to this bill transfer these functions to

government, streamline services and enhance public safety.

I move that

the bill be placed on the orders of the day for the second reading at the next

sitting of the House after today.

Motion

approved.

Bill

17 introduced, read a first time and ordered to be placed on orders of the day

for second reading at the next sitting of the House after today.

Statements

(Standing Order 25

b) B.C. INTERIOR FORESTRY MUSEUM

McMahon: One of the things that enshrines the history of Revelstoke is

forestry. The contribution it has made to the growth of this community is so

great that it is impossible to measure. As our economy grows and diversifies, it

is important to remember the staples that built this wonderful community.

Revelstoke

is located on the Columbia River between the Selkirk and Monashee mountains at

the western entrance to Rogers Pass on the Trans-Canada Highway. It is named

after Lord Revelstoke, head of a London banking firm. The city incorporated on

March 1, 1899.

Forestry

plays an important role. In recognizing this, the fledgling B.C. Interior

Forestry Museum has opened in Revelstoke. Coming into its third season at

Columbia View Park, the forestry museum staff and society have managed to fill

its 2,200-square-foot floor space and most of the wall space with artifacts and

displays preserving the history of forestry in the southern interior of British

Columbia.

Each of the

first two seasons saw approximately 7,000 visitors attend the museum. To date,

the society has collected 11 pieces of vintage heavy equipment including a 1956

Hayes logging truck and a 65-foot-high yarder made with surplus World War II

parts. I understand this was often the case for logging equipment in the forties

and early fifties.

Expansion

plans are already on the drawing board for the B.C. Interior Forestry Museum.

The society has received a licence for 30 acres of land for expansion to an

interpretative centre, including an 11,000-square-foot replica of an early 1900s

sawmill from the Kamloops area, a first nations cultural display, a logging camp

and interconnected nature trails. The society is also working on salvaging a

rare 1918 McGriff log loader which is mired on the beach in Galena Bay and

recreating the first nations summer village, circa 1830. Through fundraising,

the B.C. Interior Forestry Museum society hopes to start building trails and

clearings this summer.

Forestry is

the lifeblood of this province, and it's important that we continue to recognize

the heritage value of an industry that has built this province.

[1420]

KOOTENAY STORYTELLING FESTIVAL

Suffredine: On behalf of the community of Harrop-Procter, I want to extend

an invitation. The village of Procter exemplifies the high quality of life that

we in the heartlands of British Columbia enjoy. Its only connection to the rest

of the world is a short, free ferry ride available 24 hours a day.

If I could

use props in this chamber, I would be standing on a Kootenay storytelling

soapbox. There's a story attached to the Kootenay storytelling soapbox, but I

don't have time to tell it today. The soapbox is a communications tool with

strict rules that, if followed, resolve conflict, simplify child-rearing and

enhance spousal dialogue. The soapbox even played a role in the successful

resolution of the inland ferry issue. I carry a soapbox with me as I travel

through my riding. Made from wood harvested from the Harrop-Procter Community

Forest, it is a value-added wood product.

The

community spirit of Harrop-Procter manifested itself five years ago in the

Kootenay Storytelling Festival, which is a celebration of Kootenay heritage told

by colourful characters from all corners of the Columbia River basin. A former

schoolhouse, a decommissioned church and a community hall are all venues for

that purpose. The festival is a matter of community pride and British Columbia

pride. Plans are being made for year-round performance events and a storytelling

craft store to create part-time income for local residents. The storytelling

executive shares the provincial goal of doubling tourism revenues by 2010.

The fifth

annual storytelling festival extends an invitation to all members of this House

and to all British Columbians: come to Procter July 5 and 6 to share in the

celebration of our past and our future. Bring your story. We'll provide the

soapbox.

McDONALD FAMILY

INDEPENDENT POWER PROJECTS

Bennett: Today I'm telling the great story of one of B.C.'s pioneer families

and one of the province's first independent power projects. McDonald Ranch and

Lumber is a three-generation family business located just above the Montana

border at Grasmere. John A. McDonald of Nova Scotia, a carpenter, moved up to

Fernie from his job in Nanaimo to help Fernie rebuild after a fire destroyed the

town in 1906. In 1923 John bought a farm at Grasmere, which he and his family

worked to supply the region with apples, potatoes, beef, Christmas trees, lumber

and railway ties. In 1928 with the Grasmere Valley lit only by kerosene

lanterns, Jack McDonald fed the water from Rainbow Creek through a small pelton

wheel to power his small sawmill and grain grinder. This IPP powered the ranch,

sawmill and McDonald homes for 30 years from 1928 until 1958.

Following

in his father's footsteps, Jack's son Doug, who's now 82, and his brother Andy

constructed a concrete dam on Phillips Creek in the early 1980s, installed

[ Page 5420 ]

a 600-kilowatt GE generator and 2,000 feet of used 16-inch steel gas pipe,

built 10,000 feet of wood-pole distribution lines and installed the necessary

substations. The government of the day told Doug that the project would cost

millions to design and construct, but with a lot of hard work and innovation

Doug McDonald built his Phillips Creek IPP for $90,000 and completed the circle

of family history with the company and the family becoming self-sufficient again

as it had been from 1928 to 1958 under his father.

Mac hydro,

as the family calls it, was British Columbia's first small hydroelectric project

to tie into the B.C. Hydro grid. Now Doug and Andy's sons, Barry and Cam and

their own children, run the ranch and the sawmill planer business using the

hydro power from Phillips Creek. Hats off to the entrepreneurial pioneer

McDonald family of Grasmere, British Columbia.

Mr.

Speaker: That concludes members' statements.

Oral Questions

FAIR PHARMACARE PROGRAM

INCOME-TESTING MODEL

MacPhail: When the Minister of Health Services announced his new

income-testing scheme, he said that low-income seniors were protected. Can the

minister tell the House today how many seniors on low incomes are worse off as a

result of his Fair Pharmacare income-testing scheme?

Hon. C.

Hansen: What I said at the time of the announcement is that the majority of

seniors in this province would be either better off or the same under the new

Fair Pharmacare program. I think when you start asking questions about how many

are affected who are low-income, it comes down to a definition of what low

income is. By and large, low-income seniors and low-income British Columbians

will be much better off under the Fair Pharmacare program, when it comes into

effect.

Mr.

Speaker: Leader of the Opposition has a supplementary question.

[1425]

MacPhail: The minister says that it depends on what you define as low

income. I'd say it's a safe bet to say seniors with a family income of $15,000

or less is a low-income family. According to a Fair Pharmacare technical

briefing document obtained by the opposition, 20,000 senior families with

incomes below $15,000 a year are worse off under his new scheme — according to

his own document. That is 25 percent, one in four of all seniors with household

incomes under $15,000 a year. Again to the minister: why did he withhold this

information when he announced income testing, and can he tell us how these

families will now be worse off?

Hon. C.

Hansen: I know that the member likes to think she has sources in the

ministry, and I think last week we saw her apologize for some documents she made

claims about that weren't factual.

There have

been thousands and thousands of pages of material generated as we have developed

the Fair Pharmacare plan to make sure it is indeed fair for British Columbians.

I would say there are probably over 200 different iterations of the plan that

were developed and run through the software systems to determine exactly how it

would affect different income groups. I would caution her on using any

particular piece of information.

What we did

look at in some of that was not just at the ceiling that would be there, which

an individual would have to pay, but also the cash flow that some senior

families and other families would be facing as well. I can say unequivocally

that there is not one senior household in British Columbia earning under $18,000

a year that would wind up with a larger ceiling under the new plan than they had

under the previous plan.

Mr.

Speaker: Leader of the Opposition has a further supplementary.

MacPhail: Wow, that sure gives new meaning to waffle, waffle, waffle. That

wasn't part of the great spin or the news ads that this government is putting on

over and over and over.

This is a

Fair Pharmacare technical briefing document. The Minister of Health Services

told British Columbians that his new scheme was fair. He produced lots of

charts, graphs and case studies to help spin that story, but he forgot to

include this chart — this chart right here that was prepared for him and tells

the whole story.

Let's see:

25 percent of seniors with family incomes of less than $15,000…. I bet you

even Liberals have to admit that seniors with family incomes of $15,000 or less

are low income. Twenty-five percent, according to this, are worse off.

Thirty-four percent of families with income between $15,000 and $30,000 —

family income — 34 percent worse off. That's over 73,000 low-income senior

families who are worse off under this new scheme — no messing around. Again to

the minister: why did he say over and over again that low-income seniors would

be protected when his own technical briefing papers tell him that isn't true?

Hon. C.

Hansen: I recognize that the member's time is certainly stretched in her

ability to fulfil her role as an opposition member, and that's obviously going

to be more of a challenge now that the member for Vancouver–Mount Pleasant is

away. I have offered this member a briefing on Pharmacare, and she has yet to

take me up on that. I think if she had, she would understand where this document

fits in. I can say unequivocally that a senior household — even a senior

one-member family, a senior living on their own — earning less than $18,000 a

year will pay less under the new Fair Pharmacare program in terms of their

annual

[ Page 5421 ]

ceiling than they would under the current Pharmacare program.

Interjections.

Mr.

Speaker: Order, please. Order, please.

AFFORDABILITY OF

ASSISTED-LIVING MODEL

Sahota: My question is to the Minister of State for Intermediate, Long Term

and Home Care. Nikkei Place in Burnaby is a 59-unit assisted-living complex for

Japanese Canadians in their retirement. This facility opened up last year, and

it allows its residents to live independently while providing them with 24-hour

emergency care. There are many seniors who live on fixed incomes in my riding,

who are concerned about being able to afford these types of facilities. Can the

minister ensure my constituents that facilities like the Nikkei Place will

remain affordable for low-income seniors?

[1430]

Hon. K.

Whittred: Indeed, assisted living is a new option of care that we are

offering to the seniors in British Columbia through partnerships with B.C.

Housing, the non-profit sector and the health authorities. The one in this

member's riding is one that I had the pleasure of opening not long ago, along

with the Premier. It is an excellent example of this new offer of care. We are

concerned about this option being affordable, and for that reason, we have

adopted a plan that says that no resident will pay more than 70 percent of their

income for assisted living.

Interjection.

Mr.

Speaker: Order, please. The member for Saanich South.

Interjections.

Mr.

Speaker: Order, please.

Interjections.

Mr.

Speaker: Order. The member for Saanich South has the floor.

REGULATION OF BARBERS

AND COSMETOLOGISTS

Brice: My question today is for the Minister of Skills Development and

Labour. The minister is eliminating the requirement for barbers and

cosmetologists to belong to their association. I realize this is a deregulation

initiative, but some of the barbers and cosmetologists in my riding are

concerned that it could cause a devaluation of their skills in the marketplace.

Could the minister please explain to those in this field in my constituency why

this initiative is being taken?

Mr.

Speaker: The Minister of Skills Development and Labour.

Interjection.

Hon. G.

Bruce: The Leader of the Opposition wasn't referring to some of the other

members in this House with that comment.

Interjection.

Mr.

Speaker: Order, please.

Hon. G.

Bruce: The barbers and cosmetologists acts, brought in in 1928, are now well

superseded by three other acts in the province: the establishment regulation

under the Health Act, the Consumer Protection Act and also the ability to

utilize the Society Act to become a self-regulating body. In our bid to remove

some regulations in British Columbia — there are some 1,200 regulations in

this respect — we feel that the consumer can be well protected, from a health

and safety point of view, with the acts that are currently in place.

DRUG COURTS AND

MENTAL HEALTH COURTS

Mayencourt: My question is to the Attorney General. Just a little over a

year ago, we instituted drug treatment courts in Vancouver as an alternative

means for addicts to access the justice system and to gain access to treatment

and community services that can help them out of a cycle of crime and addiction.

I believe that this program is doing a lot to create a safer community in my

neighbourhood. New Brunswick and Washington State have recently implemented

mental health courts to offer similar options and tremendous benefits to a

vulnerable population. To the Attorney General: is he considering this

alternative justice model to assist the mentally ill in British Columbia?

Hon. G.

Plant: Well, we are monitoring the drug treatment court. There are some

early indications that it's doing what we hoped it would do, but we do intend to

conduct a rigorous evaluation. It's also clear, though, that many people find

themselves in a criminal courtroom in circumstances where they are probably

there because of a mental disorder, as much as anything else. I think it's time

that we began a focused conversation in the criminal justice system, involving

all of the participants, about how we can deal with that.

Mental

health courts have been tried in some jurisdictions with success. We're looking

at that as an idea. It's early days yet, but I do think it's an initiative worth

giving serious consideration to, and I appreciate the member's interest and look

forward to his contribution

[ Page 5422 ]

to that continuing discussion as we look for ways to make our criminal

justice system work better for all.

[1435]

GRAVEL EXTRACTION FROM FRASER RIVER

J. Les: My

question is to the Minister of Sustainable Resource Management. The Fraser River

is an important economic and environmental asset for all British Columbians. In

the area of the Fraser River extending from Hope through Chilliwack, about

350,000 tonnes of gravel are swept into that portion of the river every year.

It's important to remove that gravel to alleviate flooding concerns and also to

improve fish habitat. Six years ago the Department of Fisheries and Oceans

decided to put a moratorium on the removal of that gravel, which has a lot of my

constituents and constituents throughout the Fraser Valley concerned. My

question to the minister is: what has been happening lately to ensure that this

gravel will be removed to improve safety concerns and to improve the Fraser

River environment for fish?

Hon. S.

Hagen: It certainly is a serious issue. Some of us, as a matter of fact, are

old enough that we can actually remember the flood of '48. That's 1948.

It's a very

serious issue. I had the privilege of meeting with many of the local mayors and

also first nations last week, and I'm pleased to announce that after a lot of

work — months and months of work bringing together the Department of Fisheries

and Oceans, first nations, my staff, mayors and municipal people — we now have

a go-ahead to remove 200,000 cubic metres in that area.

We're

working to increase that for next year, because it's something that has to

happen every year, or it will continue to build up. If we get water coming over

the dikes…. In some cases, the water has built up so high that the water is

actually seeping under the dikes, which is almost as bad for the crops. We're

working very hard on doing that, and I'm pleased to announce we have the okay

now to remove 200,000 cubic metres. We'll continue to work it out.

FUTURE OF B.C. RAIL

MacPhail: Boy, Mr. Speaker, it's probably better in these coming days to

just televise the Liberal caucus meeting. It might be a little more exciting

than this.

Interjections.

MacPhail: The unfortunate fact for the Government House Leader is that the

public doesn't agree with him.

City

councils and regional districts are demanding open public consultation with

their citizens around the future of B.C. Rail. I'm sure the minister is ready

for this question. The corporation projected a $61 million profit for this year.

I discussed this at estimates with the Minister of Finance, and he confirmed it.

To the

minister responsible for rail: why is the government proceeding with plans to

privatize B.C. Rail when it's showing a big profit for government? It is

proceeding with privatizing parts of B.C. Rail. Will the minister listen to

those interior communities, the ones that they seem to care so much about, and

ask the public what they think before she betrays the Premier's promise not to

privatize B.C. Rail?

Hon. J.

Reid: It was exactly because we were in Prince George discussing with people

the future of B.C. Rail that we listened to them. They said the status quo

wasn't working. For anybody who understands what is going on with the forest

industry…

Interjections.

Mr.

Speaker: Order, please.

Hon. J.

Reid: …in this past year, there has been an anomaly in the amount of wood

that's being taken out. With that, B.C. Rail has been working with the industry

to be able to accomplish that. This is not expected to be long term, and it

doesn't take away from any of the problems that exist in B.C. Rail and their

ability to be able to serve the…

Interjection.

Mr.

Speaker: Order, please.

Hon. J.

Reid: …northern communities in a healthy and sustainable manner.

As we've

talked with the communities and talked about improving freight rail

transportation for the north and for the industries of the north, because

healthy industries mean healthy communities, we have said there will be a

consultation process. We are working right now to finalize the details of that

process.

[End

of question period.]

Petitions

MacPhail: I have two petitions to table. For the first one, I rise to table

a petition that joins with the 5,716-signature petition I tabled last week that

called for the government to rescind all cuts to B.C. Pharmacare — probably

more relevant today.

I also rise

to table a petition signed by over 750 British Columbians, which calls upon the

government to eliminate the hardships caused by cuts to health care and

increases to MSP and other user fees — even more relevant today.

[1440]

Orders of the Day

Hon. G.

Collins: In Committee A, I call Committee of Supply. For the information of

members we'll be

[ Page 5423 ]

debating the estimates of the Ministry of Transportation. In this chamber I

call committee stage of Bill 6.

Committee of the Whole House

BUDGET MEASURES

IMPLEMENTATION ACT, 2003

The House

in Committee of the Whole (Section

B) on Bill 6; J. Weisbeck in the chair.

The

committee met at 2:43 p.m.

Section 1

approved.

On

section

MacPhail: Could the minister please explain the changes that this

section

brings in?

Hon. G.

Collins: The normal process for the filing of the reports from ministers of

state would be with the report on accountability, which is disclosed along with

the public accounts. We anticipate public accounts this year to be complete if

not by the end of June, then early July. We're working towards the end of June.

Part of the challenge with the ministers of state in the health sector is that a

lot of the data that they need in order to determine whether or not they've met

their objectives is not produced by the other bodies — CIHI and other health

data trackers — until later in the year. This allows for that data to be

collected, verified and measured before the ministers are eligible for the

recovery of the salary that was set aside earlier in the year.

What it

means on their

part is that, first of all, we have better data for determining

whether or not they've met their targets and, secondly, that they need to wait

much longer before they're eligible to receive the salary set aside from the

previous fiscal year. This takes it as late as December 31. I think most of the

health data should be in, in the September-October-November window — is my

understanding. Then the assessment can be done, and an evaluation and report

would be made at that time.

MacPhail: And why are they singled out?

Hon. G.

Collins: That's because a lot of the data collected for the health care

measures outcomes are collected by other agencies. The federal government agency

called CIHI…. I can't remember what the acronym stands for, but it's the

health data tracking….

Interjection.

Hon. G.

Collins: Yeah, thank you. The Canadian Institute for Health Information.

That information isn't available until later in the year, so they're going to

have to wait until such time as we can get that data. That's what is driving

that change.

MacPhail: Mr. Chair, I need a five-minute recess, if I may, please.

The

Chair: Take a five-minute recess.

The

committee recessed from 2:45 p.m. to 2:52 p.m.

[J.

Weisbeck in the chair.]

Introductions by Members

Hon. R.

Coleman: I seek leave to make an introduction.

Leave

granted.

Hon. R.

Coleman: Joining us in the gallery today are 45 grade 11 students from the

great school of Walnut Grove Secondary in my riding. They are accompanied by

teacher George Kozlovic and Stewart Masi. Would the House please make them

welcome.

Debate Continued

Section

2 approved.

On

section

MacPhail: I have a series of questions around gas tax increases. Perhaps the

minister could explain this section. I'll read this

section out, the explanatory

note. This

section "increases by 1 cent per litre the amount of tax to be

collected within the area prescribed under the Build BC Act." Is this an

increase of 1 cent?

Hon. G.

Collins: No.

I just want

to, if I may, extend the welcome to the students from Walnut Grove Secondary.

That used to be my riding in 1991 to 1996. I lived about half a block away from

the school, so I wanted to extend my welcome as well. I hope they enjoy their

visit. It's not going to get a lot more exciting here today, but you're welcome

here anyway. You never know, though.

In response

to the question from the member opposite, on April 1, 2000, and June 1, 1999,

the previous government made some changes to the tax at that point in time. We

subsequently found out — i.e., not too long ago — that the regulations

required to put it in place were never passed. The legislation was passed, but

the regulation was not passed. In an effort to go back and clean that up, we're

now making a change to the legislation to do that — to make that legislation

effective at that date. We're really cleaning up an error that was made some

time ago. There's no increase over and above what's been there since that period

of time — i.e., this tax has been collected over that period of time. It's

just that the regulation was not in place to allow it to happen.

MacPhail: So there is no increase in the tax. Perhaps the minister could

point to the

section that identifies the increase of 3.5 cents per litre.

[ Page 5424 ]

Hon. G.

Collins: It's 21.

MacPhail: On

section 3, what is the amount of that fuel tax that goes into

the Build B.C. account now?

[1455]

Hon. G.

Collins: I'll try and get that number for the member. This is just

retroactively doing what's been in place for a period of time, but I can try and

find that number for the member. I'm sure staff is watching, and we'll try and

get it in here as quickly as we can.

MacPhail: The reason why I was asking is because I want to know whether the

act still confirms that this is a dedicated revenue source.

Hon. G.

Collins: Nothing in this

section will change what was there previously. All

it does is validate what's been happening for the last period of time.

MacPhail: Sorry. So nothing changes in terms of it being a dedicated revenue

source?

Hon. G.

Collins: That's correct.

Sections

3 and 4 approved.

On

section

MacPhail: Can the minister tell the House how many corporations are affected

by the change in the threshold amount for the corporation capital tax?

Hon. G.

Collins: I remember having a similar debate in opposition with the Minister

of Finance at the time. They made a threshold change. In the debate where I was

asking how many and which ones, I was told at the time that not only was the

minister not able to say which ones, but the minister couldn't say how many

because it might indicate which ones. It is a tax issue, and we're not able to

disclose which entities would fall within that category.

I think the

budget explanation stated that there were a number of small financial

institutions as well as credit unions that would be affected by this threshold

change. I think that's the extent to which I'm able to comment for the member.

MacPhail: In my research, I thought that this was a different clause than

what we debated before in terms of that the section…. The one that we used to

debate was around….

Interjection.

MacPhail: Yes, exactly.

Hon. G.

Collins: I understand the comment by the member that what we debated had to

do with the larger financial institutions. These are the smaller ones, but the

same principle applies.

MacPhail: I hope at some point the minister and I will change our

responsibilities so they'll know we're not debating by hand signal.

Hon. G.

Collins: We just know each other so well.

MacPhail: Exactly, yeah. Fine.

Sections

5 to 11 inclusive approved.

section 12.

MacPhail: Would the minister please explain this? The explanatory note says

that the

section "removes provisions made redundant by the addition of

section 21.1 to the Taxation (Rural Area) Act by this bill." It's changes

to the Greater Vancouver Transportation Authority Act.

[1500]

Hon. G.

Collins: As the budget stated, there were…. The surveyor of taxes charges

a fee to a number of taxing authorities as part of the taxation process. We're

trying to streamline that. There are some areas where the surveyor of taxes

currently doesn't charge a fee. We're anticipating they will start to charge.

There are areas where they currently charge a fee that the fee will probably go

down in an effort to manage that.

So, there

will be no net change in the revenue involved. We're trying to do it on a more

equitable basis. There are a whole series of sections of this bill that impact

that. Let me just try and give a couple of examples if I can. This

section 12

eliminates the opportunity for them to charge the fee to the GVTA. The same will

happen for the Islands Trust Act in

section 16, under the Local Government Act

in sections 18 and 19, the Local Services Act in

section 20 and the University

Endowment Land Act in

section 50. What we are doing in

section 46 is giving all

of those opportunities under the Taxation (Rural Area) Act. It's really just

moving the authority from one act to another. In three entities, there will be

the opportunity to charge those fees in order to recover the cost of the

process. Those are B.C. Transit, the hospital districts and the Municipal

Finance Authority of B.C.

MacPhail: Is this change needed because of any other legislation — for

instance, the community charter?

Hon. G.

Collins: No. We're just trying to streamline it, put it into that one act

and clarify it — as well as making it more equitable — so those collections

of fees reflect the services that are provided without generating any new

revenue.

Sections 12

to 14 inclusive approved.

section 15.

MacPhail: This is an increase of another tax by 0.4 percent. It increases

the tax payable in respect of

[ Page 5425 ]

property insurance and automobile insurance by 0.4 percent — so from 4

percent, now payable, to 4.4 percent. How much is collected prior to the tax

increase, and how much will be collected after the tax increase?

Hon. G.

Collins: We currently collect about $210 million. The change will result in

approximately an additional $14 million.

MacPhail: There have been people who suggest that this should be dedicated.

I'm sure the minister has been lobbied by those who would suggest that this

should be a dedicated tax, particularly in the area of…. I think I've received

lobbies — and I use that in the most positive sense — from municipalities

and firefighters. Is this going to be a dedicated tax increase?

Hon. G.

Collins: No, it will not be designated to any specific purpose, although it

does help offset a lot of the costs that we have on the firefighting side,

particularly forests. Some of the forest fires are caused by people or by houses

catching fire or by automobiles catching fire by the side of a highway — those

sorts of things. It will help government's general revenue. Obviously, there are

pressures in general revenue around firefighting. I suppose one could

tangentially link them, but it's not a dedicated tax.

Sections 15

and 16 approved.

section

[1505]

Krueger: I wish to speak to

section 17 and inquire of the minister. We have

a Lafarge Canada plant in the constituency of Kamloops–North Thompson. It was

built a number of years ago, and when it was built, Lafarge built a bridge

across the South Thompson River, which is a real boon to my constituents — an

excellent bridge. They gifted it to the public for a dollar, which is a very

much appreciated gift and very useful for a lot of my constituents. The city of

Kamloops, in that day, returned the favour by throwing out a taxation corridor,

as I understand it, to encircle the plant and make sure that in future it would

contribute to the coffers of the city — which is not uncommon, of course. The

plant currently pays about $400,000 a year in taxes, and they do not receive a

whole lot of services in return.

People have

settled around the plant and complained about the dust and particulate matter in

the atmosphere. Lafarge eventually, in collaboration with government, went to

considerable expense to construct a dust containment shed so that problem would

be ameliorated. They haven't had to pay tax on that shed because it hasn't been

included in their assessment up until now. There was some dispute over that, and

Lafarge took it to the Property Assessment Appeal Board, the Supreme Court of

British Columbia and eventually the British Columbia Court of Appeal. The

outcome was a confirmation that, as I say, up until now they didn't have to

include that shed, which really has no other purpose than to protect the

environment and resolve the concerns of the neighbours. They wouldn't have to

pay tax on the shed unless a change like this one is made.

I've had

some expressions of alarm from Lafarge. The plant in Kamloops is viable, but

it's been somewhat marginal in recent years, particularly because of the

terrible slide that the economy took during the 1990s. In fact, we went from the

best-performing to the worst-performing economy in Canada, and there wasn't

nearly as much construction in British Columbia demanding their products as

there would have been if the economy had continued as a robust economy.

Obviously,

my concern is my constituents' concern. There are dozens of my constituents who

work at that plant. They're family-supporting jobs. I'd hate to see it

disappear. I'm told that this will add to their taxes about $150,000 a year, and

it's going to put the viability of the plant into question. I wonder if the

minister could response to those concerns.

Hon. G.

Collins: I appreciate the comments by the member for Kamloops–North

Thompson, and I appreciate him bringing this issue to my attention personally.

There are three sections.

Section 17 is the first one that starts that process.

There are two others in the bill, as well, that are intended to deal with the

same issue. It was always government's intention that the property be taxable

and the improvements be taxable, but that the equipment contained within would

not be part of the assessment. That was government's intention right from the

start.

understand the comments made by the member. The way the legislation is drafted,

for those years they were assessed — but this had been in dispute — there

would be no tax owed — i.e., this is not retroactive. It is not intended to go

back and force a tax payment for those years in the past. So in that regard,

they will not be impacted by it.

This

legislation is intended to come into force December 31, 2003 — so for the 2004

taxation year — and it is to clarify what government's intention had been all

along. I understand that what triggered this legislation is, in fact, the appeal

and the court case that went through the Supreme Court. So government's effort

here is to try and clarify the legislation to make it clear what it is

government is trying to achieve.

I take the

comments of the member to heart, however, on the impact…. I certainly would be

glad to hear from him, as I expect I shall, as well as from the business as to

how this may impact them. We review taxation policy on an annual basis

obviously, and certainly if there are big problems…. However, it is the intent

of government to pass this legislation. I would be more than happy to meet with

the member and anyone he would choose to bring along to discuss the issue and

see if there is some fairness issue that needs to be dealt with. I'm more than

open to that, but it is the intention of the government to pass the legislation.

It will not come into place until December 31 of this year, so there is some

time for us to do that. I just want to caution the

[ Page 5426 ]

member, as well as the individuals impacted, that that is in fact exactly

what government is attempting to do. I understand they may be uncomfortable with

that, and I'm certainly more than happy to discuss it, but we are going to

proceed with the legislation at this point.

[1510]

Krueger: I appreciate the minister's commitment, and I'm sure my

constituents will want to take him up on that and have a meeting about this

matter. Obviously, I have the same concerns with sections 45 and 51, just to put

them on the record. I won't interrupt the debate further with that point.

Sections

17 to 20 inclusive approved.

section

MacPhail:

Section 21 is the 3.5-cents-per-litre tax increase imposed by this

government. It's split into two. I just want to get, first of all, the facts on

the record. It says that one will be a 1.25-cent-per-litre increase in tax

payable on purchased gasoline. That's under

section 21. But I also see that

section 23 — I'm just worried about votes here — increases by 1.25 cents per

litre the tax payable on purchased motive fuel, so we're up to 2.5 cents. Where

is the other increase of 1 cent per litre?

Hon. G.

Collins: Sections 21, 22 and 23 deal with the 1.25-cent-per-litre tax that

previously was designated to the B.C. Ferry Corporation. As the B.C. Ferry

Corporation changes its structure as a result of core review and becomes an

authority, rather than receiving a direct fuel subsidy from tax revenue from

fuel, they will enter into a service contract with the Crown in an effort to

provide the services. They'll be paid in the form of a contractual payment. That

will be much more transparent. It won't be buried in the Crown. It will actually

be transparent. It will be there. It will be an agreement to contract between

the Ferry Services corporation and the government of British Columbia.

What was

previously there in the form of a 1.25-cent fuel tax revenue stream will

disappear, and that will go into government's general revenue. In turn,

government will issue them a cheque for the services they render. Sections 21,

22 and 23 just comb through the previous legislation and reverse that

1.25-cent-a-litre that was sent directly to the B.C. Ferry Corporation, and it's

section 24 where we start to get into the new tax revenue, the

3.5-cent-per-litre increase.

MacPhail: I beg your indulgence here, Mr. Chair. We're combing through

sections here.

Section 25 actually removes the tax for the raising of revenue

for the purposes of the British Columbia Ferry Corporation on purchased gasoline

or motive fuel. I assume

section 25 removes it and sections 21, 22 and 23 add it

back into general revenue. Is that…?

Hon. G.

Collins: That's correct.

[1515]

MacPhail: In the estimates of the Ministry of Finance we had a discussion

about the service contract. At that time the auditor general still hadn't signed

off on the whole concept of a service contract demonstrating enough independence

or being enough of an indication that there be no subsidies flow, and therefore

the corporation would then be permitted to borrow privately and not have the

debt on book, on the government's books. It seems to me that removing the

dedicated gasoline tax to the B.C. Ferry Corporation is jumping the gun. What

happens if the auditor general comes out with a rule that indeed the corporation

is not independent enough of government? Does the minister still plan on

proceeding with the service contract?

Hon. G.

Collins: It is a hypothetical. We still anticipate that the core review of

B.C. Ferry Corporation and the new governance structure will take place

effective March 31 to April 1. We continue to work through that. It's a fairly

complicated structure, and there's lots of back and forth. I don't anticipate at

this point that we should have any big problem with that, but as the member

knows, there are always lots of details with the drafting of the legislation

that would take it into effect to make sure that government is achieving the end

result.

Regardless,

however, of what the final determination is — in-entity or out-entity — or

what the legislation actually looks like, it is anticipated that this is a

better, more transparent way of funding the Ferry Corporation, rather than

through the designated taxation revenue stream. There will be a contract in

place. The Ferry Corporation has that with government, and that will be their

revenue stream as opposed to the revenue through the gas tax.

Sections 21

to 23 inclusive approved.

section

MacPhail:

Section 24 is the

section that increases gas tax on motor fuel by

3.5 cents a litre. I want to explore this a little bit. We did explore some of

this in the Ministry of Finance estimates. I don't plan on going over it again

except to confirm what I gleaned from the Ministry of Finance estimates, which

is that this will be a tax dedicated to improving roads and bridges, and that

there will be a separate accounting of these expenditures reported annually.

Now, I want

to just ask the minister whether…. There is GST on gas tax. What is the

revenue increase to the federal government from this increase on provincial gas

tax?

Hon. G.

Collins: It's 0.245 cents per litre.

MacPhail: Okay, so we could say a quarter of a cent, just to…. How much

does that raise annually? We know that this increase in tax will cost people

$211

[ Page 5427 ]

million, I think, annually. What is the GST increase that goes to the federal

government?

Hon. G.

Collins: I'm just doing the math in my head, but I think it's about $20

million a year roughly.

MacPhail: Is there PST paid on gas?

Hon. G.

Collins: No, there isn't.

MacPhail: We already know that hundreds of millions of dollars go to the

federal government from British Columbians in gas tax revenue. Has there been

any discussion with the federal government by this provincial government about

the $20 million extra that will now be paid by British Columbians to the federal

government as a result of this gas tax increase?

Hon. G.

Collins: We have been discussing with the federal government, since probably

days after the last election, a series of agenda items, one of the largest ones

being the federal funding of transportation infrastructure. We continue to do

that. This is a small component. We're not just looking for $20 million. We're

looking for a lot more than that from the federal government, because the member

is correct. The federal government brings in hundreds of millions of dollars a

year in tax revenue related to fuel, and we get almost nothing back — and

historically certainly have not.

[1520]

We have

been in negotiations and discussions constantly with the federal government.

We're starting to see some benefit from that with the announcement of the

federal participation in the improvements to the Kicking Horse Canyon, as well

as the border infrastructure transportation initiative which was announced.

There are others where we think the federal government should and very likely

will end up being a partner, and we're going to continue to pursue those very

aggressively, as we have for the last almost two years.

MacPhail: This is going to cost, as I said already, about $211 million out

of people's pockets, and it is going to be a dedicated tax to a particular

function. The minister just said those particular circumstances were less than

transparent when applied to the B.C. Ferry Corporation. How is this different?

Hon. G.

Collins: I didn't say it was less than transparent. I said I thought that

having a service contract, which outlined what they were doing in regard to the

funding they were receiving, was more accountable and transparent. Previously,

they received a flow of revenue into the Ferry Corporation based on the fuel

tax, and there was no sort of response of what they were accountable for in

regard to providing services for that money. I just think this is a more open

way.

The

Transportation Financing Authority is a creation that's been there for some

time. The money will go into the Transportation Financing Authority, which has a

mandate, and they will have to live within their mandate. They obviously report

out annually, in an annual report, as well. Certainly, in the estimates process

there is opportunity for members to ask the minister who deals with the

Transportation Financing Authority questions with regard to the details of that.

I think this is a very clear way. It's how the revenue went there before, and it

will continue to go there.

MacPhail: I do plan on raising these issues with the Minister of

Transportation in estimates.

I just want

to talk a bit about the effect of this gas tax increase. What is the increased

cost to government in terms of this gas tax increase?

Hon. G.

Collins: I don't have a number in front of me. I know there has been some

speculation with regard to that and transit, etc. Gas price volatility certainly

fluctuates up and down beyond a 3½-cent range, so it would be difficult, I

think, for the purposes of trying to estimate the cost of this on the various

ways that government accesses fuel and to try and quantify that. To a certain

extent, it could be lost in the general fluctuations and the forecasts for gas

prices, so it's difficult to quantify.

For

example, I remember that the day before the announcement was made, gas was 82

cents. It fluctuated up and down between the day the announcement was made and

the day it became effective on March 1, and it has fluctuated up and down since

then. I've just sort of anecdotally been watching the price of gas, and I've

seen it as high as 88 or 89 cents. I've seen it down into the high seventies

since then, so it has been fluctuating up and down. Obviously, there's a 3½-cent

new tax that's in there somewhere as well, but it has not been a steady increase

in the price of gas. It's been up, and it's been down both before and since the

tax was levied.

I do know

— and the member raised it in question period — the impact of this tax on

transit costs, for example. Certainly, there is that impact, but there is also

just the price of fluctuations of gas. We're in this odd situation right now

where as a result of some of the challenges in Venezuela and the disruptions in

their production as one of the large OPEC producers and, as well, the anxiety

over what may or may not happen in Iraq possibly in the next weeks, the price of

gas has gone up substantially.

There are

lots of things at play, and it would be difficult to try and take a snapshot of

a week or even a couple of months and say that's the measure we should be taking

and that we should run some long-term numbers based on that. I anticipate that

if the problems in Iraq resolve themselves, probably — one way or the other

— there could be increases, but there could also be decreases in the price of

gas.

Certainly,

the last time there was a conflict in the Gulf, the price of oil went up

dramatically, then declined quite precipitously thereafter and levelled off for

a long period of time. The economics are such that it's very difficult to

forecast. If we could, we'd probably both make a lot more money than we do now.

That 3½

[ Page 5428 ]

cents is well within the normal price fluctuations of gasoline. To my

knowledge, and I can check, I don't know that individual agencies or individual

school districts have yet made a long-run forecast of what the impact of the 3½

cents might be.

[1525]

MacPhail: Actually, it has nothing to do with the price of gas. Whether gas

goes up or down, everybody either benefits or is harmed by that. Price would be

different without this gas tax increase. It's separate and apart. Just the same

way the government has been able to calculate that revenue of $211 million extra

will flow each year from that gas tax increase into the coffers, surely they

must be able to calculate how much of that $211 million is being paid by

government.

I'm not

talking about agencies. I believe our vehicle fleets are governed by one agency,

so budget has…. Well, not budget. That's not a good example because that's

consumer pay. Trucking companies have been able to calculate how much extra this

is going to cost; taxi companies have. I'm just asking the minister. He could

calculate how much revenue he gets. Surely he must know how much he has to pay

of that revenue.

Hon. G.

Collins: It's also based on volume, and the price elasticity of gas would

have to be taken into consideration as well. We don't know, for example, for

sure how the market's going to respond to a 3½-cent-a-litre gas tax. Much like

when you raise the tobacco tax, you can do a very straightforward, straight-line

mathematical calculation — which is what I'm assuming many entities have done

— which says: "We bought so many litres last year; we're going to buy so

many litres this year. Add 3½ cents to that per litre, and here's a

number." I know that's probably how they've done it.

As I

mentioned, the price of gas goes up and down, and that's based on elasticity.

It's based on how people respond to the market. It's based on international oil

prices — all of those things like local supply, local competition. At least,

that's the theory behind it. It's difficult to determine. I stand to be

corrected if I'm wrong, but we do a calculation that is based on what the

overall sales are, what the revenue increase might be. Probably in there is some

adjustment for price reaction.

Certainly,

if I can use tobacco again as an example, we raise it this year by $2 a carton.

You can't assume that you're going to sell exactly the same number of cartons of

cigarettes and exactly the same amount of loose tobacco and do a straight-line

calculation and come up with a number, because people's behaviour will respond

to that. Maybe fewer people will use it. There may be other things; they may use

less. All those things come into play. You do the best estimate. It's a forecast

of what you think. Certainly, our revenue forecast for the gas tax is just that.

It's a forecast. It's $211 million this year. I can almost guarantee you that it

won't be $211 million; it will be something above it or below it. If we get

really lucky and hit it right on, that would be great, but that rarely happens.

It's a forecast.

How might

the various entities in the broader public sector calculate their costs? I

anticipate that most of them, probably including the trucking industry, have

done a straight-line calculation based on the volume they purchased in the past.

With all other things being equal — that is, the price of gas would remain the

same — do a 3½-cent increase to the volume that you bought last year and you

get a number, but markets don't necessarily respond that way.

MacPhail: I certainly hope the minister isn't obfuscating. It sounds like he

is, because if he isn't, then it's only bad news for him. It means that the $211

million that he's relying on to build roads and bridges in this province may not

be there. It's different.

I agree

with the minister about the comparison to cigarettes, only to the point that

there's elasticity of demand. This government has gone on to link other things

to the collection of this tax. When you collect cigarette taxes, the government

hasn't then said: "Oh, by the way, and then we're linking increased taxes

to provision of cancer surgery." They haven't done that. In this particular

case, they have.

[1530]

The only

money being invested into roads and bridges in the interior and the coast comes

out of this fund, so it better be accurate. If it isn't accurate, it means fewer

roads and bridges will be built. I can't accept the fact that the minister

doesn't know an estimate of how much of this $211 million in extra taxes will be

paid by the government. I'm talking out of the CRF. I'm not talking about out of

anything else. I'm just talking about out of the fleet of vehicles that this

government uses on a day-to-day basis from ministries.

One other

thing. It ain't good news if the elasticity of demand because of a gas tax

increase means people are going to use less fuel, because I expect that people

in the transportation industry aren't going to get on a bus to ship their stuff.

I don't expect that tourism operators are relying on increased public transit so

that people can come and visit their destinations.

Let me

carry on, then. Clearly, I'm not going to get an answer from the minister about

how much of this is direct government expenditure. We did have the calculation

when MSP premiums were increased. Everybody else could figure it out exactly,

and there's elasticity of demand there as well. I'm just taken aback by that

work not being done.

Well, let

me ask the question, then, about elasticity of demand. Tourism. It's a major

part of the economy — 4 percent of GDP and 7 percent of employment. What

studies has the minister done in terms of the impact of this gas tax increase on

tourism?

Hon. G.

Collins: We made a decision that the infrastructure deficit that was there

needed to be dealt with. Government made a decision to invest fairly heavily in

infrastructure in the years ahead. It made a decision that we were not going to

leave a debt behind as a re-

[ Page 5429 ]

sult. So, the value of the 3.5-cent-per-litre gas tax revenue is going to be

plowed, penny for penny, into the building of that infrastructure in an effort

to make sure we don't have a debt.

There are

many benefits that could accrue to a whole bunch of people as a result of this.

The trucking industry had a study that said the delays at the border alone cost

them $60 million a year. We are now investing in border infrastructure as part

of the agreement with the federal government. That's where part of these

revenues will go. We hope that will save the trucking industry $60 million a

year once they're complete.

The tourism

industry as well. I would guess that tourism — buses that move around in the

city of Vancouver, for example, if you want to deal with density issues…. Once

these infrastructure improvements are in place, they may find that their fuel

consumption actually goes down because they'll have greater flexibility and

greater ability to move. That may be. These are long-run investments.

You could

take an example of some of the other ones, the safety improvements. Kicking

Horse Canyon is an example of a fairly major infrastructure change that will

improve safety, and that improved safety certainly is a positive message for the

tourism industry as well. There was a horrific accident involving a tourist bus

not too long ago in that part of the province. I know at that time the tourism

industry said that's a highway that needs to be improved. That is something that

has to happen for them in order to continue that industry in a safe way.

There are

all sorts of benefits that are clear and anecdotal but that are difficult to

quantify. I think that the overall benefits not just to tourism but to the

mining sector, to the forestry sector, to just about anybody who is using the

highways and roads of the province — on a safety side as well as potentially

on a fuel consumption side, as well as on wear and tear on their vehicles —

are immense. I think there are lots of benefits that are out there. They're

anecdotal. They'd be very difficult to quantify, but they're there.

MacPhail: Two out of the three examples the minister gave there were

infrastructure investments in the lower mainland. It's my understanding that

this tax is being used for areas outside of the lower mainland. Is this money

being used to do border crossings in the lower mainland?

[1535]

Hon. G.

Collins: There is a whole series of infrastructure projects that are on the

list, which we're trying to achieve. There are rural and remote roads. There's

maintenance. There are upgrades. There's looking at bridge infrastructure, as

well, outside the lower mainland. I — and, I think, the minister — said at

the time that over the next three years, we are going to be collecting

approximately $650 million from this flow of revenue, and we are going to spend

every dollar on infrastructure. We're going to try and lever additional

investments from private sector partners as well as from the federal government,

in order to ensure that we can maximize each dollar we spend. Through the

raising of the 3.5 cents, $650 million are going to be invested. There is a hope

for an additional $1.7 billion in contributions from other partners. Those will

be dispensed across the province, based on the transportation infrastructure

needs that exist now.

MacPhail: For the record, the previous provincial gas tax of 11 cents per

litre all went to transportation infrastructure as well, so that's not a change.

Throughout the entire 1990s, British Columbia was the only province, I think, to

spend 100 percent of its fuel tax revenue on transportation infrastructure. None

of it went into general revenue. While I acknowledge the fact that that trend

will continue, it's not a new trend.

Well then,

I'm curious. Yesterday I saw the list put forward by the Premier for

transportation infrastructure at the provincial congress. Border crossings were

not on the list, and no lower mainland projects were on the list. Is the

minister now saying that some of this money may go into the lower mainland? I'd

be happy to hear that.

Hon. G.

Collins: It hasn't been determined that all of it, or none of it, will go

into the lower mainland. The agenda is to take these dollars and invest them on

the priorities of the province, to try and leverage additional sources of

funding from the federal government and from private sector partners, and to

maximize the value for the dollars we get. If the member wants a fuller briefing

on the plan, then obviously the place to do that is in the estimates of the

Minister of Transportation — or, I know, the minister would be more than happy

to provide an individual briefing for the member. As well, there is a fair bit

of information on the government website as a result of the rollout of the

transportation infrastructure plan, which may answer a lot of the questions that

the member might have.

MacPhail: I will be following up with the Minister of Transportation in her

estimates. I'm going by the commitment the government made that this money would

be spent in their rural strategy and interior strategy. We were also told that

tolls may be an option in the lower mainland. Just as recently as yesterday, I

saw the Premier's list of what infrastructure was going to be built. He related

it to exactly the same figures that the Minister of Finance has just suggested.

I just want

to read two things into the record. In December 11, 2001, the Minister of

Competition, Science and Enterprise said: "We are a government that stands

for reducing taxation, not increasing taxation. Increasing taxation does not fit

in with our new era of hope and prosperity for British Columbians." That

was then; this is now. From the MLA for Cariboo South, February 18, 2003,

responding to this gas tax increase: "I don't know. I would hope that we

don't see too many more increases in anything." Has the minister received

any feedback from businesses — small, medium or large — on the gas tax

increase?

[ Page 5430 ]

[1540]

Hon. G.

Collins: I wouldn't say I've received a copious amount, but then they

probably wouldn't send it directly to me. It would more likely go to the Premier

or the Minister of Transportation. I have seen a number of letters from

individual businesses, as well as associations, saying the investment on

infrastructure is the right thing to do. They're glad we're not leaving a debt

as we build it, and they're glad we're paying for it as we build it. I think

it's fair to say that nobody likes to see any tax go up — anytime, ever. I

would put myself in that category as well, although I think this one is

something the majority of British Columbians understand. They certainly are

aware that we do have a deficit in infrastructure. We've underfunded it over a

long period of time — not underfunded, but over a long period of time there

have not been the investments in it to either keep it current or expand it in

such a way that continues to be a source of economic strength for the province

and safer as well. So we continue to do that.

We did get

some positive responses from industry. Obviously, as the member mentioned, the

trucking industry was upset about the cost, but the trucking industry is also

going to be one of the chief beneficiaries of the improvements as well. So, as I

said, I think people understand the benefit. I understand and accept that people

don't ever like to see any tax raised at any time. But we decided that if we're

going to make these improvements, we were going to pay for them.

[1545]

Section 24

approved on the following division:

YEAS — 65

Falcon

Coell

Hogg

Halsey-Brandt

Hawkins

Whittred

Cheema

Hansen

J. Reid

Bruce

Santori

van Dongen

Roddick

Wilson

Lee

Hagen

Murray

Plant

Campbell

Collins

Clark

Bond

de Jong

Nebbeling

Stephens

Abbott

Neufeld

Coleman

Penner

Jarvis

Anderson

Orr

Nuraney

Brenzinger

Belsey

Bell

Long

Chutter

Mayencourt

Trumper

Johnston

Bennett

R. Stewart

Christensen

Krueger

McMahon

Bray

Les

Locke

Nijjar

Bhullar

Wong

Bloy

Suffredine

MacKay

Cobb

K. Stewart

Visser

Lekstrom

Brice

Sultan

Hamilton

Sahota

Hawes

Manhas

NAYS — 2

Nettleton

MacPhail

Sections

25 and 26 approved.

section

[1550]

MacPhail:

Section 27 provides for tax exemptions for fuel in prescribed

circumstances. Is this an addition to allow for the prescription of exemptions?

Hon. G.

Collins: Yes, it is. It's designed to allow for an exemption for marine gas

used in turbine engines. The member will recall, in July of 2001, that when the

government brought in its economic and fiscal update, it provided a bunker fuel

exemption or removed the tax on bunker fuel. That was in response to the

shipping industry and, as well, the cruise ship industry in particular. There is

a new generation of ships being developed in the shipping industry, which use

turbine engines and actually are far more environmentally friendly — is my

understanding. They felt that an exemption that was given to bunker fuel should

be provided to them, as well, for competitiveness reasons, and we agreed.

Sections

27 to 38 inclusive approved.

section 39.

MacPhail: This

section repeals the special account known as the working

capital account. For the House, could the minister explain what it was and what

replaces it?

Hon. G.

Collins: This account has been inactive for a number of years. Ministries

now receive funding directly for capital asset acquisitions themselves. It's no

longer needed; therefore, it's being repealed.

MacPhail: So it's just that the work that the Purchasing Commission did

around capital is no longer there. But other purchases continue?

Hon. G.

Collins: That's correct.

Section

39 approved.

section

MacPhail: It's hard to tell from either the explanatory notes or the act,

but it looks like this particular section, which amends the social service tax,

excludes from taxes…. Oh no, that's not the one. That's 41. I'm fine with 41,

the bird seed.

Section 40 now includes items for taxation. Am I correct? Maybe

the minister could explain the clause.

Hon. G.

Collins: There are exemptions in place right now in the mining industry for

certain products

[ Page 5431 ]

that the industry uses. The aggregate industry, which is gravel mining,

gravel quarrying, has asked that they be provided with similar exemptions in the

spirit of fairness, and for the same reasons we've applied it to the mineral

industry. We agreed, and therefore we're providing that exemption here as well.

MacPhail: So to be clear…. It's an interesting drafting. Under clause 40,

the third line, it's got bolded there, "…and substituting…."

Everything after that is now exempt from the social service tax payment?

Hon. G.

Collins: The act used to say it didn't include these things. The act, as it

was previously written, had a list and a comma and said, "but does not

include…" and a list of things. What we've done is take out the wording

that says, "but does not include," so this latter list, which was

excluded, now gets attached to the first part of the sentence, so they're all

included in the exemption now. I hope that explains it.

[1555]

MacPhail: Yes, I think it does. Just to be clear, building and construction

stone, marble, shale, clay, sand and gravel used to pay social service tax, and

now they don't. What was the revenue stream on social service tax from these

items in '02-03 approximately?

Hon. G.

Collins: It would not be a great deal. We think it's probably a hundred or

hundreds of thousands of dollars. It's not in the millions at all.

Sections 40

to 42 inclusive approved.

section

MacPhail:

Section 43 adds a power to make regulations prescribing the

circumstances in which the commissioner must impose a penalty under a particular

section. This is under the Social Service Tax Act. What's the reason behind this

addition?

Hon. G.

Collins: It's really a redirection of where the liability lies. The way it

worked in the past is a contractor, on behalf of a customer, may go and make a

declaration that they're exempt. If they fail to do that or if they actually

weren't exempt, then the penalty would be assessed to the contractor. We feel

that's inappropriate. Penalties should be assessed to the purchaser, because

it's their declaration that needs to be made. Rather than having the penalty

applied to the contractor, the penalty must be applied to the original

purchaser.

[K.

Stewart in the chair.]

Sections 43

to 51 inclusive approved.

section

MacPhail: This is a transitional provision for revised ministerial

accountability rules in relation to anticipated federal health care spending.

The Minister of Finance and I discussed this in estimates. It deals only with

transitional situations for ministerial accountability for Minister of Health

Services and Minister of Health Planning. What the

section basically does is say

that once the budget comes down, the money from the federal government, a new

service plan or new estimate will be introduced, and it will be on that basis

that the Minister of Health Services and Minister of Health Planning will be

held accountable under the Budget Transparency and Accountability Act. I'm

curious to know what the status is of those discussions with the federal health

care moneys and what happens if there's no agreement, in terms of this fiscal

year.

Hon. G.

Collins: Well, there is an agreement between the first ministers that there

will be a certain amount that flows. The questions that we are dealing with now

are: how does the money flow, and when does it flow? We're working on the

details right now, and as I mentioned, the federal government would like to be

able to flow it all in this fiscal year for their purposes.

Interjection.

Hon. G.

Collins: Sorry, no — well, probably 2003-04. They want to put it out the

door as quickly as possible. They're moving from a cash to an accrual basis next

year, so they want to get it out as soon as they can.

We've made

it very clear to them that we have some very clear rules in this province around

how that works. We're moving to GAAP in a legislated way, and therefore that

model won't work for British Columbia. We advised them of that. I know I advised

the Minister of Finance of that repeatedly. I know the Ministers of Health did.

I know the Premier did, as well, and received assurances from the Prime Minister

as well as the Minister of Finance and the Deputy Minister of Finance that they

would work with us to try and develop a way that would work for the province.

Those discussions are ongoing.

[1600]

I think

we've identified what the various options might be. The reality is that at some

point, the federal government will have to determine how it plans to proceed. We

have been involved in lockstep with them, trying to make sure they understand

our accounting needs and how it would have to work in British Columbia.

I've spoken

to the Minister of Finance. I've passed other messages. There's been

correspondence to the deputy minister and to the Premier. There have been a lot

of people involved in this. At this point, as I said, I think we've identified a

couple of options. We'll have to wait and see what the federal government's

response is to that. I believe we should know that fairly soon, within the next

couple of weeks or so.

MacPhail: There is no issue about more money flowing in the B.C. provincial

fiscal '03-04. Money will flow?

[ Page 5432 ]

Hon. G.

Collins: That's correct. We assume it will flow. The challenge we have is

that it might all flow in '03-04, and then you see a big spike in money that we

would find very difficult to spend wisely. I doubt the Health ministry couldn't

spend it. I'm sure they could find a way to spend it, but I doubt it would be

spent wisely if $1.3 billion were to come in one year. What we're trying to do

is say that that money should be done over three years as the deal and the

commitment were, and really what we're sorting out now is just the accounting.

There will be additional funds in '03-04. We just don't know the amount yet.

MacPhail: Who's conducting those negotiations?

Hon. G.

Collins: As I mentioned, the Premier and the Prime Minister have spoken

about it a couple of times. They certainly spoke at the time when the ministers

were meeting. Officials are involved from the Premier's office, from the

Ministry of Finance. As well, I'm involved when necessary. It's a top priority

for the government obviously. It is a large amount of money. It's very crucial

to the health planning and to the health delivery in the province that it flow

in a way that makes sense and that is useful to improve health care outcomes.

That, as well, is the goal of the federal government: to improve health care

outcomes. What we're really discussing is the accounting treatment of it. As the

member is probably aware, sometimes those can get pretty technical and

frustrating, but we continue to pursue it at the highest levels.

Sections 52

to 58 inclusive approved.

section

Hon. G.

Collins: I move the amendment to

section 59 standing in my name on the order

paper.

[SECTION

59, by deleting the proposed subsection (1) and substituting the following:

(1) In this section:

"government"

includes an improvement district, a municipality or a regional district under

the Local Government Act or the City of Vancouver under the Vancouver Charter;

"tax

Acts" means the

(

a) Corporation Capital Tax Act,

(

b) Hotel Room Tax Act,

(

c) Insurance Premium Tax Act,

(

d) Local Government Act,

(

e) Logging Tax Act,

(

f) Motor Fuel Tax Act,

(

g) Social Service Tax Act,

(

h) Taxation (Rural Area) Act,

(

i) Tobacco Tax Act, and

(

j) Vancouver Charter.]

Amendment

approved.

Section 59

as amended approved.

Section 60

approved.

Title

approved.

Hon. G.

Collins: I move the committee rise and report the bill complete with

amendment.

Motion

approved.

The

committee rose at 4:03 p.m.

The House

resumed; Mr. Speaker in the chair.

Reporting of Bills

Bill

6, Budget Measures Implementation Act, 2003, reported complete with amendment.

Third Reading of Bills

Mr.

Speaker: When shall the bill be considered as read?

Hon. G.

Collins: By leave, now, Mr. Speaker.

Leave

granted.

Bill

6, Budget Measures Implementation Act, 2003, read a third time and passed.

Hon. G.

Collins: I call committee stage debate of Bill 7.

Committee of the Whole House

INCOME TAX AMENDMENT ACT, 2003

The House

in Committee of the Whole (Section

B) on Bill 7; K. Stewart in the chair.

The

committee met at 4:05 p.m.

Section 1,

section 25.1, and

section 2,

section 42 approved.

section

section 79.

MacPhail: At second reading I noted that my discussion was not necessarily

around using the tax structure to encourage business, but a discussion around

what else indeed needs to be done to assist these industries, so my questions

will flow from that.

Section 3

deals with the tax credits for animation and digital effects. Of course, this is

a very competitive global market. We're doing well in British Columbia in this

area, though. My question here is the status of the industry, in terms of what

the industry suggests this tax credit will do for them.

Hon. G.

Collins: Both Quebec and Ontario have similar tax provisions. They're not

identical, but they're similar. We made a commitment as government that we would

maintain the competitiveness of our taxation

[ Page 5433 ]

system in the province. That's what this is intended to do. It's to put those

industries on a level playing field so they can compete. It's a new area; it's a

growing area. We have some great expertise and some talent here in the province.

We want to keep that and grow that business. Certainly, as the film industry

gets more and more technically advanced…. A larger and larger component of

just about every movie has some animation or visual effect, so we want to make

sure that we don't find ourselves in a position where we're not competitive with

other jurisdictions based on what they're doing.

MacPhail: Is there anything about this tax credit that applies separately

and apart from animation and digital effects?

Hon. G.

Collins:

Section 3(

a) is really the digital animation and visual effects.

Section 3(

b) applies to all the tax credits, and it clarifies that all preceding

years' labour expenditures are included in the calculation. It's a cumulative

expense, as to how they determine this tax, so they want to make sure all the

previous years are included in that. It's really just a technical clarification

of the legislation that was there before.

MacPhail: But my understanding is that this tax credit is expanding to

include the animation and digital effects industry.

Hon. G.

Collins: This

section actually takes a previous tax credit and adds digital

animation and visual effects to it, yes.

[1610]

MacPhail: I'm curious to know, and the reason I'm asking that is…. Mr.

Chair, I'm voting in favour of all of these sections, but because sections 3

through 10 deal with the animation and digital effects industry, I'm curious to

know what discussion there has been with the industry about how the regional

production services tax credit will apply. What is the regionalization of this

industry?

Hon. G.

Collins: Previously the tax credit applied only to domestic production. It

now applies to international production as well.

MacPhail: I'm just trying to get a sense of where this regional tax credit

would apply. I know there have probably been discussions with the industry, just

in my own experience in this area. The industry lobbies for this and says how it

will work. Where will there be a regional application of this tax credit?

Hon. G.

Collins: The regional tax credit is generally outside the GVRD, so it's to

try and add a further incentive to make regional film production more

competitive as well. A lot of it happens, as the member will know, in the lower

mainland. We believe there are plenty of opportunities to extend that industry

outside the lower mainland into the rest of the province, and the regional tax

credit is designed to do that.

MacPhail: The minister and I have had discussions about the value of the

dollar as it applies to our various industries, and I was very interested in the

perspective of both Dr. Lipsey and Dr. David Emerson yesterday at the provincial

congress on the value of the dollar and how it relates. Both of them seemed to

think that a higher dollar in the long run was good. Dr. Lipsey certainly

suggested there would be more pain in the short term than did David Emerson.

I just note

for the minister that I'm not convinced that the short-term pain won't be a

killing pain. If a short-term pain kills off something, it doesn't matter that

it's short term. It's deadly. I fully understand the argument that Dr. Lipsey

was making about productivity and the fact that we have to be highly productive

and that the low Canadian dollar masks that.

I just make

my point here that regional tax credits mean nothing if a high dollar wipes out

the industry. I share only great hope that industries expand, and I share great

worry about an interest rate policy that allows for a higher Canadian dollar,

combined with other aspects, that may be a short-term killer.

Hon. G.

Collins: The member and I have had that discussion in the past, and I was

present for the discussion and the debate as it took place yesterday at the

provincial congress and for the comments by the member opposite, by Dr. Lipsey

as well as by Dr. David Emerson with regard to interest rate exposure and the

impact on our economy. It's a fact, and those industries that are extremely

competitive are even more subject to the whims of interest rate fluctuation.

It's something I know they take into consideration.

I also know

the film industry can move very quickly in choosing locations, and certainly we

have to be mindful of that. It is something that I think all industry, as well

as all workers in an industry, should keep in mind. It's always in the best

interests of everybody to be as flexible and as productive as they can be. It

certainly puts you in a better position when the weathers of change or, in this

case, interest rate fluctuations start to bite and have an impact. One should

never assume the Canadian dollar is going to stay in the mid-sixties. It could

change. You should always be prepared to be as efficient and productive as you

can be to ensure that those winds of change don't set you off course.

I am

mindful of the comments the member made. I am also mindful of and I have

conveyed, and will in the future continue to convey, the position of the

province with regard to interest rates to the governor of the Bank of Canada

when we meet with him or his staff periodically throughout the year — that

they must be mindful of British Columbia's economy, not just Ontario's economy,

in determining what the impact of inflation and the impact of interest rates

are. Certainly, this industry is an example of one that is very much subject to

those kinds of fluctuations.

[ Page 5434 ]

Sections

3 to 12 inclusive approved.

[1615]

Title

approved.

Hon. G.

Collins: I move the committee rise and report the bill complete without

amendment.

Motion

approved.

The

committee rose at 4:17 p.m.

The House

resumed; Mr. Speaker in the chair.

Report and

Third Reading of Bills

Bill

7, Income Tax Amendment Act, 2003, reported complete without amendment, read

a third time and passed.

Hon. G.

Collins: I call committee stage debate of Bill 9.

Committee of the Whole House

AUDITOR GENERAL ACT

The House

in Committee of the Whole (Section

B) on Bill 9; K. Stewart in the chair.

The

committee met at 4:17 p.m.

Sections

1 to 45 inclusive approved.

Title

approved.

Hon. G.

Collins: I move the committee rise and report the bill complete without

amendment.

Motion

approved.

The

committee rose at 4:18 p.m.

The House

resumed; Mr. Speaker in the chair.

Report and

Third Reading of Bills

Bill

9, Auditor General Act, reported complete without amendment, read a third time

and passed.

Hon. G.

Collins: I call committee stage debate of Bill 11.

Committee of the Whole House

MISCELLANEOUS STATUTES

AMENDMENT ACT, 2003

The House

in Committee of the Whole (Section

B) on Bill 11; K. Stewart in the chair.

The

committee met at 4:19 p.m.

Hon. G.

Collins: We're awaiting the arrival of the member for Vancouver-Hastings, so

perhaps the committee can just recess for a few minutes.

The

committee recessed from 4:20 p.m. to 4:25 p.m.

[K.

Stewart in the chair.]

Section 1

approved.

Sections 2

to 5 inclusive approved.

section 6.

MacPhail: This amendment to the Budget Transparency and Accountability Act

provides for the application of generally accepted accounting principles in

advance of the requirement established by

section 23.1 of the act. As I recall,

section 23.1 of the act says that the GAAP principles have to be in place and

used by 2004-05.

Hon. G.

Plant: My understanding is that the commencement date for

section 23.1 of

the BTAA is April 1, 2004. The effect of this amendment and the next

section is

to speak to the application of that requirement in respect of the timing of

different documents. I'm in the member's hands unless she'd like a slightly

larger explanation.

MacPhail: I'm just curious to know. This amendment apparently provides for

it to be applied earlier than '04-05. My reason for asking the question — it's

just for information — is that the budget for '03-04 is already done. How do

you apply principles earlier than '04-05?

Hon. G.

Plant: Let me read the note that has been prepared for the assistance of

ministers with respect to this

section and

section 7 to see if it answers the

member's question:

"The

purpose of this amendment is to clarify the application of generally accepted

accounting principles implementation to specific documents referred to under

the Budget Transparency and Accountability Act.

Section 23.1 of the BTAA

requires that all accounting policies and practices applicable to documents

required to be made public under the act for the government reporting entity

must conform to GAAP."

I said earlier, the commencement date for

section 23.1 is April 1, 2004. The

commencement date was intended to ensure that all government documents

pertaining to 2004-05 and future fiscal years would be in compliance with

GAAP. However, the timing for the implementation of the

section does not

coincide with the timing for release of certain government documents.

The effect

of this amendment is twofold. The amendment provides for the application of GAAP

in advance of the commencement date for certain speci-

[ Page 5435 ]

fied documents. For example, the 2004-05 estimates, which will be tabled in

February 2004, will need to be in compliance with GAAP. That's the "earlier

than" part of it.

The

amendment also provides an exemption from the application of GAAP for documents

released after the commencement date but pertaining to fiscal years prior to

2004-05. For example, the '03-04 public accounts, which will be released in June

'04, pertain to a prior fiscal year, and those will not be required to be

prepared in compliance with GAAP if these sections pass.

MacPhail: I take it then, basically — and I'm not smiling for any reason

other than that it's not the minister's responsibility, so I understand him

referring to written notes — that we want GAAP to apply to the '04-05 budget.

So, if there's anything that occurs prior to April 1 that has to do with '04-05,

it will be GAAP-able, and anything after April 1 that applies to '03-04 won't be

GAAP-able.

Hon. G.

Plant: That's my understanding of the intent of the sections.

Sections 6

to 9 inclusive approved.

section 10.

[1630]

MacPhail: This is a

section that broadens the definition of

"emergency" to include events or circumstances that involve only one

person, and clarifies that volunteers are persons registered under the Emergency

Program Act for the purpose of responding to a disaster or emergency. Why is

this change necessary?

Hon. G.

Plant: I will defer to the Solicitor General, who is arriving for the

purpose of assisting the member.

Hon. R.

Coleman: Basically, the broadening of the definition of volunteer is to

ensure that they are protected under

section 18 from liability and to ensure

that in small events, like searches and what have you, they're protected. So

we've actually broadened the definition of volunteer.

MacPhail: Why is the change necessary to define an emergency as just

applying to one person?

Hon. R.

Coleman: Mainly because when legal people got a hold of what the broader

events were with regard to how emergencies were defined, it just wasn't felt

that it protected people on single-subject events, like single searches in the

mountains where you're searching for a single person in the mountains. Some

people were interpreting that that wasn't a broader event because it wasn't a

larger emergency, so it had some effect on our volunteers in search and rescue

as far as their protection from liability and that type of thing.

Sections 10

to 28 inclusive approved.

section

MacPhail:

Section 29 amends the Hotel Keepers Act. Actually, Mr. Chair,

sections 29 and 30 deal with the Hotel Keepers Act. I just need information. I'm

not going to be voting against it. This refers to the relationship between an

innkeeper and a peace officer. Could the minister please explain the necessity

for this change. What are the implications of it?

Hon. G.

Plant: Sections 29 and 30 of this bill make some changes to the Hotel

Keepers Act. The general objective is to clarify some of the authority around

who has the right to make sure that hotel guests are free from disturbance by

undesirable non-registered and other guests.

[1635]

The tourism

industry has apparently been asking for this clarification since about 1999. The

idea is to help the industry in this way to perhaps encourage investment in the

industry. It would be a fact of some interest if this lack of clarification was

actually a reason for the success or failure of the hotel industry in British

Columbia, but I'm sure it's an important part of their business.

The

minister who is directly responsible for this has arrived.

Section 29 amends the

definition of innkeeper because there was some inconsistency between the types

of accommodation that were attached to the definition of "innkeeper"

and the definition of "inn" under the act. There was an inconsistency

there which is intended to be addressed in this bill, mainly by simplifying the

definition of innkeeper to just "the keeper of an inn." The more

important amendment is to sections 6, 7 and 8 of the act, and I wonder if I

could defer to the Minister of State for Deregulation, who is the lead on this.

Hon. K.

Falcon: I am actually replacing the minister responsible, who couldn't be

here to speak on this. I'm happy to do this in his stead, and I will do the best

I can on short notice. As the Attorney General just said, it amends the

definition of what an innkeeper is, but, primarily, what it also tries to do is

address a concern that the hotel industry has had for many years, having to do

with unruly guests. In the past the only ability the hotels have been able to

have is to evict non-paying guests of their hotel. This will change that to

allow the innkeeper to evict paying guests of their hotel. It's an important

distinction. They didn't have that ability before. So I think that summarizes

it.

MacPhail: The reason why this one caught my attention is because one often

has to be careful what one wishes for. It seems to me that someone who's

[ Page 5436 ]

wanting to attract people to your industry and then threatens them — a

paying guest — with a fine of not more than 2,000 bucks if they have a beer

and sing loud might be a bit of a problem for the industry. Not having any

personal experience with that kind of behaviour, I'm just surmising what could

happen.

Yesterday I

heard this weird story on radio about a bylaw in place in West Vancouver that

said that anybody making any noise at any time, if there were a complaint

raised, then had to stop making that noise. Some poor jazz band had to stop

practising in West Vancouver because their neighbours were upset by that.

Interjection.

MacPhail: Exactly. A lot of provinces would have to shut down with that kind

of…. Of course the bylaw was thrown out. The person — the family, the band,

the jazz band leader — challenged the bylaw, and it was thrown out.

It does

seem to be a particularly heavy hand of regulation, and I worry about the

application of it. Is there a history of this kind of legislation existing

elsewhere in other parts of the free world?

Hon. K.

Falcon: Yes, in fact, this is something that the industry has actually been

asking for. In fact, there have been approvals by the British Columbia Lodging

and Campgrounds Association, the Yukon hotel association — of which you would

be aware — and of course the British Columbia Association of Chiefs of Police.

I will say

that Alberta and the Northwest Territories are places that currently have very

similar legislation. Having been to Alberta, particularly during the Stampede, I

can assure you that noise is something that they've become well accustomed to

dealing with. What I think you'll see here is that it allows the innkeepers to

use good judgment, and any good-quality innkeeper will want to ensure they have

an establishment in which the noise levels are not so audacious that it's going

to drive away other people staying at their hotels.

[1640]

In the

past, as I said, they never had the ability to actually deal with this because

they could evict only non-paying guests. So what often happens in these

situations, member opposite, is that there will be an increasing level of noise,

and there will be concern by the innkeeper that this could be followed by

property destruction, etc., but it hasn't yet hit that point. They've received a

flood of complaints from other guests in the facility, and they want to be able

to have the ability to act on that and to ask those people to desist and, if

they do not desist, then have the ability to evict.

MacPhail: My next question may be appropriate for the Attorney General; I

don't know. It's under the same

section but talks about peace officer powers. It

seems to me that this

section says if a guest is making a ruckus and the

innkeeper thinks it's appropriate that the guest be evicted, then the peace

officer has the right to arrest without a warrant the person who fails to comply

with the eviction. Is this standard?

Hon. G.

Plant: This is not that unusual. I think part of what these two provisions

do — will it become sections 6 and 7 — is that they not only give the

innkeeper the ability to respond directly to disturbances of the peace, but they

also ensure that there are circumstances where the innkeeper can call police and

get the police to help. The fact that the peace officer has the authority to

arrest without warrant in this provision is not unusual.

Part of

what these provisions are trying to do is operate preventively. Whether that's

the way they'll operate, I guess time will tell. The fact that a peace officer

will have the power to arrest without warrant a person who fails to comply with

or is suspected on reasonable grounds of failing to comply with a request is

not, I think, unique in the statutes of British Columbia.

MacPhail: To the Minister for Deregulation: did the industry talk about

refunding their room charge if they get evicted, or is it you play, you pay?

Hon. K.

Falcon: That scope wouldn't come under the act. That would be up to the

individual hotel keeper to decide whether that's appropriate.

Section 29

approved.

section

Mayencourt: My question is just one. I'm seeking some clarification. I have

a number of what we term SRO hotels within my riding and within the downtown

east side. I wonder if I can get some clarification on how this particular act

deals with those SROs. Or are they covered by the Residential Tenancy Act? Who

draws that line, and where is that line?

Hon. K.

Falcon: The member raises the issue really of the interface between the

Residential Tenancy Act and the Hotel Keepers Act as it relates to single-room

occupancy. I think that's the correct term: single-room-occupancy rooms. The

Hotel Keepers Act applies to situations where there is a licence to occupy a

premise that is given on a temporary basis, and the Residential Tenancy Act

deals with tenants. That includes hotels, for example, that are being used as a

place of residence where the room charge is less than $20 a day, which would

certainly capture all of the circumstances that the member is currently bringing

up.

Presently,

under the current Residential Tenancy Act, the landlord has the authority to

evict a tenant who has unreasonably disturbed other tenants, who has seriously

impaired the safety or other lawful right or interest of the landlord or other

tenants or who has caused extraordinary damage to the rental unit or resi-

[ Page 5437 ]

dential property. In summation, I want to thank the member for

Vancouver-Burrard for bringing up that issue, because I think it will clarify

that concern about the overlap between those two acts.

Section 30

approved.

section

[1645]

MacPhail: This deals with the Livestock Act, dogs causing injury or damage.

The Attorney General offered me an explanation of these changes that I would

just like put on the record, if I may, for I think it does clarify the

situation.

Hon. G.

Plant: This

section is related to

section 32. The effect of

section 32 is to

repeal all of the Livestock Protection Act, which is a statute that was first

passed in 1875 to provide for the control of dogs in rural areas and prevent

dogs from becoming a nuisance to livestock. The Livestock Protection Act is

considered to be redundant. Our government's view is that we can repeal the

Livestock Protection Act without undermining the authority that exists in other

legislation including, for example, the Local Government Act to allow local

governments to control dangerous dogs.

This one

provision that is in the Livestock Protection Act now, which has to do with dogs

causing injury or damage, has been pulled out of the Livestock Protection Act

and will be put in the Livestock Act ,and gives the authority or the power to

somebody to kill a dog if a person finds the dog running at large and attacking

or viciously pursuing livestock. The view of government is that that authority

continues to be useful in the context of livestock protection, so while the rest

of this outdated statute is being repealed, this provision is being maintained

in substance.

There is,

as I told the member in my discussion with her about this, a minor technical

change, I suppose. What is the equivalent now of 11.1(2)(

b) is expressed more

broadly, and the right of someone to kill a dog if the person finds the dog

running at large is expressed in the existing Livestock Protection Act in terms

that say that this right to kill may arise if the person finds the dog running

at large and attacking or viciously pursuing a person, I think, or another dog.

We're changing that, narrowing it, to limit it to livestock.

It's not,

perhaps, the most profound transformation in the social contract that has been

brought to the fore of the Legislature of British Columbia in the last century,

but we are trying to strip out some of the redundant statutes in the statute

books.

Section 32 does that, and this

section that we're now discussing

preserves one part of that old statute that we think still serves some public

purpose.

MacPhail: Yes, and my hope is that the cow being chased by the dog doesn't

end up on hotel property where the innkeeper would have to make a choice between

the cow or the dog in whom to evict — or shoot.

Anyway,

thank you, and I do take it seriously.

Sections 31

to 40 inclusive approved.

section

MacPhail: This

section of the Motor Vehicle Act expands the categories of

out-of-province students who are exempted from licensing and insurance

requirements. I note, though, that there are also changes in

section 42. It

seems to me that if you read 41 and 42 together, what one giveth is taken away

in 42, but I could be reading it wrong.

[1650]

Hon. G.

Plant: I don't think that's the intent. I think the intent of these

provisions is to expand the scope of the exemption from licensing and insurance

requirements of the Motor Vehicle Act, which currently is available for

out-of-province students attending public post-secondary institutions, to make

it available to out-of-province students who are attending private

post-secondary institutions designated for student financial aid, provided that

those students still have a valid out-of-province licence and insurance. I think

the intent is to say that the exemption that's currently available for students

who are at public institutions should also be available for students who come to

British Columbia to study at private post-secondary institutions.

Sections 41

to 43 inclusive approved.

section

MacPhail: This

section re-enacts a

section of the Motor Vehicle Act that

says psychologists, optometrists and medical practitioners aren't liable for

reporting a patient's medical condition when the condition makes it dangerous

for the patient to drive a motor vehicle and the patient continues to drive

after being warned of the danger.

By the way,

I support this section, but I know that this is controversial — to the extent

that I think also

section 230…. Well, let me ask this of the Attorney General.

I won't presume. Is there an obligation, on that basis, on psychologists,

optometrists and medical practitioners to now report their patients to the motor

vehicle branch if the medical practitioners think they are not capable of

driving?

Hon. G.

Plant: Yes.

Hon. R.

Coleman: It's there now. The obligation is for the practitioner to say to

the person: "You don't drive because of this condition." If the person

then drives, it is the obligation of the practitioner to notify.

Sections 44

to 66 inclusive approved.

section

[ Page 5438 ]

MacPhail:

Section 67 amends the Water Protection Act, and it specifies the

Fraser watershed. Now, I think the Fraser watershed is being singled out here,

and I'm curious to know why.

Hon. G.

Plant: If the member will indulge me for a moment, I'll take advantage of

the note that has been prepared for me on this.

The Water

Protection Act prohibits bulk water removal from British Columbia and also

prohibits large-scale transfers of water between major watersheds of the

province. The problem is twofold, I think. First, the GVRD apparently takes

water from reservoirs in two major watersheds. The Capilano and the Seymour

reservoirs are in the coastal watershed, and the Coquitlam reservoir is in the

Fraser watershed. The water is actually transferred between these watersheds via

something called the westerly transfer project.

This is the

second part of the problem. Since the construction of this project began before

this act was passed, the operation of this project is apparently grandparented.

However, any modifications to it or construction of a similar pipeline that

would transfer water between major watersheds are contrary to the act, and this

impedes the GVRD's ability to plan for infrastructure upgrades. It's an

unintended consequence of the operation of the transfer restriction in the Water

Protection Act.

[1655]

The

proposed solution, which is in front of us, is simply to amend the definition of

the Fraser watershed in paragraph (

a) of the definition of major watershed in

section 1 of the act, so that the Fraser watershed includes the area both inside

and outside the boundaries of the GVRD that is drained by streams and their

tributaries contained in whole or in part within the boundaries of the GVRD. As

a result, the Capilano and Seymour reservoirs will be in the Fraser watershed

for the purposes of this act, as is the Coquitlam reservoir, and for the

purposes of the act, no prohibited transfer between these major watersheds will

occur.

MacPhail: What consultation was done? Who signed off on this?

Hon. G.

Plant: I'm advised that the GVRD requested the amendment, and government has

been working with the GVRD with respect to this issue. I believe that is the

extent of the consultation that has taken place with respect to the initiative.

I should

point out that, although it may have gone without saying in my last answer, the

amendment will have no impact on environmental protection. It will not affect

the general ban on bulk water transfer out of the province. It is unique and

does not, therefore, significantly affect any other major watershed defined in

the act. Its operation is limited to the very, almost technical objective that I

attempted to give expression to in my previous answer.

Sections 67

to 71 inclusive approved.

Title

approved.

Hon. G.

Plant: I move the committee rise and report the bill complete without

amendment.

Motion

approved.

The

committee rose at 4:57 p.m.

The House

resumed; Mr. Speaker in the chair.

Report and

Third Reading of Bills

Bill

11, Miscellaneous Statutes Amendment Act, 2003, reported complete without amendment,

read a third time and passed.

Hon. G.

Plant: Could we recess for just three minutes?

Mr.

Speaker: The House will stand recessed for five minutes.

The House

recessed from 4:59 p.m. to 5:05 p.m.

[Mr.

Speaker in the chair.]

Hon. G.

Plant: I call estimates debate. For the information of members it's the

estimates of the Ministry of Community, Aboriginal and Women's Services.

Committee of Supply

The House

in Committee of Supply B; J. Weisbeck in the chair.

The

committee met at 5:05 p.m.

ESTIMATES: MINISTRY OF

COMMUNITY, ABORIGINAL

AND WOMEN'S SERVICES

(continued)

On vote 16:

ministry operations, $642,998,000 (continued) .

MacPhail: I'm going to do women's equality, but perhaps I could just ask the

Minister of Community, Aboriginal and Women's Services — it will just take

five minutes — about the change in status of the Royal B.C. Museum and the

implication for his budget.

Hon. G.

Abbott: The bill that has completed first reading in the House will move the

Royal B.C. Museum from a special operating agency, where they need to come to

government for special partnerships, arrangements or even changes in the

admission fees for special events like the Chinese dinosaur exhibit that's

coming up. By moving to a Crown corporation or Crown trust model, the ability of

the board and the

[ Page 5439 ]

executive director of the Royal B.C. Museum to make those kinds of decisions

is enhanced. Certainly, this is a change that the museum and its board have been

looking for, for about a decade.

The bill

that's before the House captures those changes and, I think, puts the Royal B.C.

Museum on a better footing in terms of being able to attract bequests,

endowments, contributions and donations in the future, because it moves it a

step further away from government than what it was as a special operating

agency.

In terms of

the impact on the budget, I think the changes are intended more for the

long-term development of the museum as opposed to any short-term budget issues.

Those short-term budget issues were resolved, as I think the member knows,

through an agreement between her former government and the museum about three

years ago, I think.

There's a

schedule that's a part of that agreement, which sees a gradual reduction in the

funding from government to the museum. This change in the status of the museum

is certainly going to be useful in terms of the museum moving forward and

achieving its goals, notwithstanding that funding reduction in the short term.

MacPhail: Some of this will need to be discussed with the bill before the

House, so I'll leave that in terms of the implication of ownership of artifacts

and all of that, to that stage.

In terms of

the budget of the Minister of Community, Aboriginal and Women's Services,

there's a flow — sorry, I don't have my estimates book here — of around $12

million from the minister's budget to the Royal B.C. Museum. Beyond that

funding, then, is this new special operating agency a permission for the Royal

B.C. Museum to set its own admission rates, etc.? They don't have to come to

cabinet for that?

Hon. G.

Abbott: Yes.

I guess if

we were going to continue this discussion, I might want to move the vote with

respect to the Royal B.C. Museum, but we'll leave that for another time. I think

the member and certainly myself will want to get better prepared for that

discussion. We can do it a little bit later in the estimates process.

[1710]

The short

answer to the member's question — and it's a very good question — is that

yes, the change from special operating agency to Crown trust will be one

that…. Again, I'll use the example I used earlier, the Chinese dinosaur

exhibit, which is a very costly exhibit to bring in. A lot of the excellent

materials are, in fact, being brought in from China. It's very expensive to

mount the exhibits, so they need a higher admission price to manage that.

Cabinet had to approve that higher admission price. With the new status, the

cabinet would not have to approve. The agency itself would have the authority to

do that.

While I

have the floor, let me clarify a point from a question which the member for

Vancouver-Hastings raised earlier today. I apologize to her because my answer

wasn't as complete as it should have been, but I can provide her with that now.

She asked earlier about the downtown east side target area and empowerment zone.

The staff was familiar with that document, but the document was, in fact,

entitled DESTA'NEZ , which is an acronym based on those words. The report

from DESTA'NEZ has been discussed at the staff level, and it has now been

referred to the city of Vancouver, who are going to be giving their

consideration to it and presumably bringing forward any recommendations they may

have to the management committee of the Vancouver agreement.

MacPhail: Those are my questions on the Royal B.C. Museum for estimates.

We'll have more discussion when the legislation is debated.

For the

Minister of State for Women's Equality, I want to begin with the UN report of

the committee to end discrimination against women.

The

Chair: Just one second. I just want to know if the minister would like to

have some opening remarks and introduce the staff.

Hon. L.

Stephens: I'd like to begin by introducing the assistant deputy minister,

women's policy branch and child care, Kaye Melliship, who is here today; the

Deputy Minister of CAWS, Bob de Faye; and the director of women's policy, Elise

Wickson, who is here as well. I'd just like to say how much we appreciate the

hard work they do for our ministry and certainly for the people of British

Columbia.

I'd like to

begin by telling the committee that we have met all of our 2002-03 service plan

initiatives and that our government is making progress in the areas we've

identified as our priorities. We've maintained and protected the budget for

transition houses, Stopping the Violence programs and the Children Who Witness

Abuse programs, and we are developing a safer community strategy that will

improve women's safety in their communities. We'll be talking a little bit more

about that in the weeks to come.

We are in

the final stages of a long-term child care strategy that makes sure our child

care programs are stable, predictable and sustainable for the future. We are

also working across government to address the systemic barriers faced by women

in this province. For example, we have established and created a new

best-practices guide to gender analysis that will be distributed to all

ministries to help guide policy work. Now, this new best-practices guide to

gender analysis is much more user-friendly than one that has been in the past.

There's less tape, and it certainly means that the likelihood of it being used

will be much greater than the quite cumbersome document that was he