Alberta Hansard — 25 May 1994, Afternoon sitting (13:30) (Legislature 23, Session 2)

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Alberta — Debates (Hansard)

May 25, 1994 Alberta Hansard 2179 Legislative Assembly of Alberta Title: Wednesday, May 25, 1994 1:30 p.m. Date: 94/05/25 [Mr. Speaker in the Chair] head: Prayers MR. SPEAKER: Let us pray. O Lord, we give thanks for the bounty of our province: our land, our resources, and our people. We pledge ourselves to act as good stewards on behalf of all Albertans. Amen. head: Introduction of Visitors MR. MAR: Mr. Speaker and members of the Assembly, today I have the privilege to introduce to you His Excellency Jorgen Behnke, ambassador of Denmark to Canada, and Dr.

Donn Larsen, honorary consul for northern Alberta here in the city of Edmonton. His Excellency has had a distinguished career which has included, prior to coming to Canada, a position as the chief of protocol for the government of Denmark and postings with the Danish embassies in Brazil, Finland, and Chile. Denmark is Alberta's 15th largest trading partner in western Europe and in the past has been a source of foreign investment in the development of Alberta's economy. I would like to ask His Excellency and Dr.

Larsen to please rise in the Speaker's gallery and receive the warm welcome of this Assembly. head: Presenting Petitions MR. SPEAKER: The hon. Member for St. Albert. MR. BRACKO: Thank you, Mr. Speaker. Y et more petitions from residents of St. Albert and the surrounding area who urge the government to reconsider the inclusion of the Sturgeon General Hospital within the Edmonton Region and to allow the Sturgeon General Hospital to serve its customers from the City of St. Albert, the MD of Sturgeon, the Town of Morinville, the Village of Legal, the Alexander Reserve, the Counties of Athabasca, Barrhead, Lac Ste.

Anne, Parkland and Westlock. MR. SPEAKER: The hon. Member for Spruce Grove-Sturgeon- St. Albert. MRS. SOETAERT: Thank you, Mr. Speaker. Y et more petitions. This is a petition signed by several of my constituents who are concerned that the Sturgeon general hospital is not in the same health region as the MD of Sturgeon. Thank you. MR. SPEAKER: The hon. Member for Redwater. MR. N. TA YLOR: Thank you, Mr. Speaker. I, too, have the pleasure of presenting a petition, some people might say a certificate for my re-election, asking that the hospital be moved from St. Albert to where it belongs: to the north. MR.

SPEAKER: The hon. Member for Edmonton-Beverly- Belmont. MR. Y ANKOWSKY: Thank you, Mr. Speaker. I rise to present a petition containing 71 signatures from Albertans regarding education, health, and seniors' housing concerns. MR. SPEAKER: The hon. Member for Edmonton-Whitemud. DR. PERCY: Well, thank you, Mr. Speaker. I would like to table a petition that requests that the Legislative Assembly continue funding kindergarten at the current level without placing undue financial stress on Alberta families by the imposition of user fees. head: Reading and Receiving Petitions MR. SPEAKER: The hon.

Member for Spruce Grove-Sturgeon- St. Albert. MRS. SOETAERT: Thank you, Mr. Speaker. I'd ask that the petition I presented concerning the Sturgeon general hospital and its placement within the Edmonton region be read and received. CLERK: We, the undersigned, petition the Legislative Assembly of Alberta to urge the Government to reconsider the inclusion of the Sturgeon General Hospital within the Edmonton Region and to allow the Sturgeon General Hospital to serve its customers from the City of St.

Albert, the MD of Sturgeon, the Town of Morinville, the Village of Legal, the Alexander Reserve, the Counties of Athabasca, Barrhead, Lac Ste. Anne, Parkland and Westlock. MR. SPEAKER: The hon. Member for Calgary-Buffalo. MR. DICKSON: Thanks, Mr. Speaker. I ask that the petition I introduced on May 1 1 urging that sexual orientation be included in our Individual's Rights Protection Act now be read and received.

CLERK: We, the undersigned residents of Alberta, petition the Legislative Assembly of Alberta to urge the government to provide equal protection for gay and lesbian people by including sexual orientation within the Individual's Rights Protection Act. MR. SPEAKER: The hon. Member for Redwater. MR. N. TA YLOR: Thank you, Mr. Speaker. I'd ask that the petition I presented to the House on May 1 1 on restoring the St. Albert hospital to its proper place be now read and received.

CLERK: We, the undersigned, petition the Legislative Assembly of Alberta to urge the Government to reconsider the inclusion of the Sturgeon General Hospital within the Edmonton Region and to allow the Sturgeon General Hospital to serve its customers from the City of St. Albert, the MD of Sturgeon, the Town of Morinville, the Village of Legal, the Alexander Reserve, the Counties of Athabasca, Barrhead, Lac Ste. Anne, Parkland and Westlock. MR. SPEAKER: The hon. Member for Edmonton-Avonmore. MR. ZWOZDESKY: Thank you, Mr. Speaker.

I would request that the petition I presented to the Legislature on May 12 urging this government to retain the Grey Nuns hospital as a full-service, acute care treatment centre be now read and received.

2180 Alberta Hansard May 25, 1994 CLERK: We the undersigned petition the Legislative Assembly of Alberta to urge the Government to maintain the Grey Nuns Hospital in Mill Woods as a Full-Service, Active Hospital and continue to serve the south-east end of Edmonton and surrounding area. MRS. HEWES: Mr. Speaker, may I request that the petition I presented on the 16th of May regarding budget cuts now be read and received.

CLERK: We, the undersigned residents of Alberta, petition the Legislative Assembly to urge the Government not to implement its planned budget cuts to, and restructuring of: the education, health care and social services systems in Alberta and to immediately halt all plans to privatize any government asset or service, including jails, hospitals, social housing and seniors residences. head: Introduction of Bills MR. SPEAKER: The hon. Member for Cypress-Medicine Hat. Bill 39 Alberta Health Care Insurance Amendment Act, 1994 DR. L. TA YLOR: Thank you, Mr. Speaker.

I request leave to introduce a Bill being the Alberta Health Care Insurance Amend- ment Act, 1994. Basically, Mr. Speaker, this Bill will place a cap on the number of new billing numbers given out every year. Of course, doctors presently enrolled in the billing system will be automatically enrolled.

A number of criteria will be utilized, among those being need; two, practitioners engaged in medical education programs in Alberta; number three, Alberta medical graduates currently engaged in training programs elsewhere; and other physicians who meet exception criteria as determined by the minister. [Leave granted; Bill 39 read a first time] MR. DA Y: Mr. Speaker, I once again move that Bill 39 as just introduced be moved onto the Order Paper under Government Bills and Orders. [Motion carried] head: Tabling Returns and Reports MR. SPEAKER: The hon. Member for Edmonton-Whitemud. DR. PERCY: Thank you, Mr. Speaker.

I'd like to table a variety of documents. The first is Western Canada in the International Economy, a study from the Western Centre for Economic Research. The second is Alberta and the Economics of Constitutional Change, and parenthetically I'd like to thank the government of Alberta and Treasury in particular for financing this. The Economics of Constitutional Change Series, agriculture in a restructured Canada; and From East and West, regional views on reconfederation, a study by the C.D. Howe Institute. MR. SPEAKER: The hon. Member for St. Albert. MR. BRACKO: Thank you, Mr. Speaker.

I'd like to table four copies of a letter from Registrations Are Us. It deals with Bill 22, the Maintenance Enforcement Amendment Act, concerning safety of the employees, implications of Bill 22 on their compa- nies, and recommendations from the Registries Agents Association of Alberta. MR. SPEAKER: The hon. Member for Edmonton-Glenora. MR. SAPERS: Thank you, Mr. Speaker. It's my pleasure today to table a document on behalf of the Glenora Parent Teacher Association. It's a book that they've asked me to make available to the members of cabinet entitled All I Really Need to Know I Learned in Kindergarten.

They ask that I in particular draw to the attention of the Assembly a quote in the forward which reads . . . MR. SPEAKER: Order please. That is the purpose of tabling, to make the document . . . MR. SAPERS: Thank you, Mr. Speaker. I'll table the document for their perusal. 1:40 Introduction of Guests MR. SPEAKER: The hon. Member for Calgary-North West. MR. BRUSEKER: Thank you, Mr. Speaker. It is my pleasure today to introduce to you, sir, and through you to other Members of the Legislative Assembly on behalf of the Member for Calgary- West a group of junior high school students from A.E. Cross junior high school.

This school has been attending the Legislature here on an annual basis for a number of years, and coincidentally it's a school where I had the opportunity to teach for three years of my teaching career. Today there are five teachers, Denis Gardiner, Helen Clark, Ross Hodgson, Art Hanson, and Erika Smith, and two parents, Potula Berkis and Tim Dietzler. They're in both galleries. There are 73 students, seven adults, a total of 80. I'd ask them to rise in the galleries, please, and be welcomed by the members of the Assembly. MR. SPEAKER: The hon. Member for Calgary-Cross. MRS. FRITZ: Thank you, Mr. Speaker.

Today I have the privilege of introducing to you and through you Annette Martin. I first met Annette in the early '80s when she was working in the health and fitness area of the Calgary YWCA, and she now contributes her time as a national director of the Canadian Liver Foundation. Annette moved to Edmonton with her husband, Don Martin, who's seated in the media gallery, and is accompanied by her in-laws, George Martin of Greenwood, Ontario, and Paul Martin of Stouffville, Ontario. I'd ask that they rise and receive the warm welcome of the Assembly. MR. SPEAKER: The hon. Member for Edmonton-Glenora. MR.

SAPERS: Thank you, Mr. Speaker. It's a pleasure today to rise to introduce to you and through you to all members of the Assembly a constituent of mine who's visiting in the public gallery. Peggy Gouin is a member of the bar in the city of Edmonton, and she's here to enjoy the proceedings. I would ask Peggy to rise and receive the welcome of this Assembly. head: Oral Question Period MR. SPEAKER: The hon. the Leader of the Opposition.

May 25, 1994 Alberta Hansard 2181 Party Leadership Campaign MR. DECORE: Thank you, Mr. Speaker. I'd like to start by tabling four copies of an affidavit that had been signed by Michael Edwards. The affidavit is dated yesterday, and the affidavit states that Mr. Edwards was a volunteer working on the Klein leader- ship campaign. Mr. Edwards under oath states that he phoned prospective voters for the Klein campaign out of Minister Kowalski's legislative office.

He also states under oath that a list of lottery fund applicants was used to call and solicit Klein support; that is, applicants who had r eceived lottery funds and those who had applied for lottery funds. My questions are all going to be to the Deputy Premier. Mr. Minister, will you confirm that volunteers were using your legislative office to call prospective supporters for Mr. Klein during his leadership bid? MR. KOW ALSKI: Mr. Speaker, I would really like to see this affidavit. As I stand here, I have no recollection or knowledge of a person by the name of Michael Edwards.

I don't know such a person that I can remember. I would love to see the affidavit. MR. DECORE: I thought the question was pretty clear, Mr. Deputy Premier. Let's try the next one. Mr. Deputy Premier, what role did you or your offices play in providing lottery lists to Klein telephone callers? MR. KOW ALSKI: Well, Mr. Speaker, as I have mentioned in this Assembly, I've tabled in this House on numerous occasions annual reports of all lottery-funded beneficiary groups in the province of Alberta.

I have from time to time tabled in this Assembly the reports of all beneficiaries under the community facility enhancement program. I have tabled documents such as the annual report of the Wild Rose Foundation, the annual report of the Foundation for the Performing Arts and entered in all of those reports is a listing of all groups in the province of Alberta that have received lottery funds. That's all public information.

I would sincerely hope that people associated with me in the fall of 1992, knowing full well that I was supporting the candidacy of one Ralph Klein, would have had the initiative to basically take some of that information and call on behalf of the leadership candidate that I was supporting. Mr. Speaker, that's a very, very open, democratic opportunity for everyone in the province of Alberta using public information. MR. DECORE: Mr. Speaker, I don't ever recall seeing applica- tions tabled in this Assembly for lottery funds. Mr.

Deputy Premier, as the minister responsible for lotteries at that time, as the minister who made decisions on lottery grant applications, and as the minister dealing with hundreds, perhaps thousands of people, did you not think that this process, this method of giving out lottery lists to Klein supporters was extraor- dinary to say the least? MR. KOW ALSKI: I now have a copy of this so-called affidavit. Again, the name Michael Edwards of the city of Edmonton is unknown to me. I don't ever r ecall meeting such a person, knowing such a person. Mr.

Speaker, he says, "I was given . . . instructions on what to say to callers, as follows," and I quote: Hi, my name is Michael Edwards and I am calling on behalf of Mr. Kowalski. As you are probably aware, the present P.C. leadership campaign is ongoing because of the undecided vote and we are soliciting support for Mr. Klein on Ken Kowalski's behalf. Well, Mr. Speaker, I want to thank Mr. Edwards for working on his own volition in support of my candidate, Mr. Klein.

I want to repeat again that if the hon. member would like me to stand in this Assembly tomorrow and table one more time all of the documents that I have tabled since 1992 on behalf of all of those groups in the province of Alberta which have r eceived lottery funds, I would be very happy to do that, Mr. Speaker. I'm prepared to do that. On the other hand, if the hon. gentleman would like to go to the library and look and see, he'll find that all of those documents are there. They're all public, all of them.

Every group in the province of Alberta that received lottery funds is listed, specifically the name of the group and I think in most reports in fact even the amount of money they've received. So, Michael Edwards, thank you for helping me get Ralph Klein elected. MR. DECORE: I don't frankly see the humour in this. My second questions also are questions to the Deputy Premier. The affidavit suggests that when telephone calls were made, the caller, Michael Edwards – this is under oath – was told not to acknowledge that he was using a list of lottery applicants.

In fact, he was told that if asked how the applicants' names came to his attention, he was to say that it "had come from a list of commu- nity league members or supporters" or had been passed on by some other member. Those are statements made under oath in the affidavit. My first question to the minister: are you aware that someone in your office was telling this Klein caller to fabricate a story with respect to names on the lottery list? MR. KOW ALSKI: Mr. Speaker, no, I most certainly am not.

If there was such a person in my office who was suggested to someone after the fact, I would like to know of such an individ- ual, who that person was, and how they were doing it. All the affidavit says is: 6. I was also told that if anyone on the list of lottery fund grant applicants asked how I got their name or telephone number, I was told not to divulge the fact that I was using the list of applicants. Okay; fair game. I was to tell them that their name and number had come from a list of community league members or supporters, or that their names had been passed on to us by some other member.

I have no idea who this other member was. I have no knowledge of this whatsoever. Once again, lists are all public information, all publicly available, and anyone who was involved then . . . I can't comment on this. I'm unaware of what this is. MR. DECORE: Mr. Minister, as the minister who made decisions to give out public moneys, would you confirm that telephone calls were being made out of your office throughout all of Alberta in support of Mr. Klein by these volunteers? 1:50 MR. KOW ALSKI: Mr. Speaker, I can't confirm that calls were made, quote, out of my office.

I can confirm the people working in my office, though, certainly did make phone calls after office hours from their own homes and other offices in the province of Alberta. They were committed, as I was, to the election of the new leader of the Progressive Conservative Party, one Ralph Klein. Anyone associated with me is encouraged to be an active participant in the democratic process in the province of Alberta. Anyone associated with me and my offices who are employees are encouraged after hours to be very much involved, on weekends to

2182 Alberta Hansard May 25, 1994 be very much involved. Some of them in fact even come with me to meetings, political meetings and public meetings. I'm just really delighted that in fact the people associated with me would want to work on behalf of the democratic process in the province of Alberta. Once again, thank you for helping me get my Premier elected. MR. DECORE: Mr. Speaker, I'd like the Deputy Premier to tell Albertans the total cost of all these calls that went throughout Alberta and who paid for them. MR. KOW ALSKI: Well, Mr.

Speaker, perhaps the hon. member would want to contact one Michael Edwards and determine from him how many calls he made, if he made any, and what the cost might be. I have no idea how much money was spent by someone working on a telephone out of their own home in the evening or on a Saturday. I would suspect that there were a fair number of calls. Perhaps there's a way of finding this out.

I do know that when there was a by-election in east central Alberta a number of years ago, the Member for Redwater certainly made phone calls out of his legislative office in Edmonton on behalf of the Liberal candidate in that by-election, and that's been talked about before. As I recall, it's even been talked about in Members' Services, and that was done b ecause the hon. gentleman wanted to convey support for someone on behalf of someone else in a public environment. I can't give that answer, because I don't know how many people made how many phone calls.

If there was a way of quantifying this, I would try and do it. MR. SPEAKER: The hon. Member for Calgary-North West. Third main question. Western Heritage Centre MR. BRUSEKER: Thank you, Mr. Speaker. The western heritage centre near Cochrane is a beautiful concrete basement with a stairway to heaven. There's nothing else there. The project supposed to be completed in 1992 has stalled b ecause fund-raisers can't raise the matching dollars. Instead of allowing their commitment to lapse, the government recommitted lottery funds, $5 million, for another two years.

My question is to the minister responsible for the lottery fund. Since construction is slated to begin in one week, a week from today, can the minister tell us how much of the required $3.3 million has been raised by the fund-raisers for this centre? MR. KOW ALSKI: Mr. Speaker, it's my understanding in listening to the Member for Banff-Cochrane yesterday when he was asked such a question that something like a million dollars had been raised in recent months. MR.

BRUSEKER: My supplementary question then is: why would the government allow construction to recommence when the Premier's buddy Norm Haines – and the minister just confirms it – admits the society hasn't got their required half of the money? That's how we ended up with the concrete bunker we've got right now. MR. KOW ALSKI: Mr.

Speaker, it's not at all uncommon when there are fund-raising activities and projects for construction in the province of Alberta that in the marketplace we have, there are large numbers of groups out soliciting funds, and sometimes not all groups can work as quickly and as rapidly as others. Here in the city of Edmonton is an example. There's a concert hall proposal. There is a large number of volunteers who are actively pursuing the project.

It was only last week that in fact confirma- tion was given by the council to the city of Edmonton that there would be a certain piece of land designated for it in the city of Edmonton. That did not preclude them from doing other types of works, and the same thing applies to the western heritage centre in Cochrane, Alberta. Mr. Speaker, this has not been an easy project for fund-raisers to work forward on. One of the reasons has been some of the negatives that have come forward by the hon. member himself with respect to that.

On the other hand, we believe and those who are in support of it believe that if you want to develop an infrastructure for tourism in this province, then in essence you have to commit yourself to something and you have to work hard towards it. We believe that the western heritage centre in Cochrane can be as important to the heritage sites that we have in this province as the carriage museum is in Cardston, as the Tyrrell museum is in Drumheller, as the Reynolds museum is in Wetaskiwin. We're pretty confident that given some time, in fact they will be able to go forward with it. MR. BRUSEKER: Well, Mr.

Speaker, the final supplementary. The project is supposed to be completely self-financing when it starts operating. What proof can the minister provide to the members of this House that ind eed this facility will not require ongoing government operational subsidies? MR. KOW ALSKI: Mr. Speaker, it's been made very, very clear that there will not be any government operating funds for this facility. There is a document that basically indicates that the particular group has to raise the money and has to put in place a position for the capital dollars required for the construction of such a facility.

There's also, I think, a provision within the contract that basically says that they have to raise X amount of dollars to meet the ongoing total amount of the capital operation, and as I recall, that's 50 percent. Now, the purpose of such a facility is that they will charge people who come to it. So if they have half the amount of dollars in the bank before they begin, then revenues that will come in on a fee-for-service basis will provide them with the other remaining amounts of money. At the end of a particular year they should have either a positive balance sheet or a break-even one. MR. SPEAKER: The hon.

Member for Calgary-Egmont. Adolescent Recovery Centre MR. HERARD: Thank you, Mr. Speaker. My questions are to the chair of AADAC, the hon. Member for Calgary-Bow. In my last town hall meeting parents with children in the Alberta Adolescent Recovery Centre expressed concern and disbelief that this program that successfully returns young addicts and their families to a meaningful life is still not part of AADAC's mainstream adolescent treatment program. Now the centre is again facing closure and still does not receive ongoing support from AADAC.

Would the chair of AADAC indicate why this successful program does not receive funding? MR. SPEAKER: The hon. Member for Calgary-Bow. MRS. LAING: Thank you, Mr. Speaker. The AADAC centre, it is true, does not receive ongoing funding at this time. Origi-

May 25, 1994 Alberta Hansard 2183 nally this centre was set up with the understanding that the funding would come from clients and private corporate fund- raising. Operational costs were not sought from the government. However, they have requested and have received onetime start-up funding of $600,000 in November of '89 and in November of '93, onetime interim emergency funding of $100,000. MR. HERARD: Well, without any disrespect, what does AARC have to do to qualify for funding from AADAC? MRS. LAING: Mr.

Speaker, if AADAC is to respond to any further funding requests, it would require a formal report and proposal. They would also have to complete an evaluation and review of their program, their clients' needs, and the affordability of the program. MR. HERARD: Is the chair of AADAC prepared to look into this funding crisis and see what can be done to save this meaning- ful adolescent recovery program? MR. SPEAKER: The hon. member. MRS. LAING: Thank you, Mr. Speaker. Actually, I have not been contacted directly by this group for funding in the current status.

However, I will ask AADAC officials to review the situation. Thank you. Senior Citizens' Programs MRS. HEWES: Mr. Speaker, this government is developing an habitual use of closure. Now that there's an effective opposition, this measure . . . [interjections] Thank you. Now that there's an effective opposition, this measure is increasingly used to silence debate on actions. Closure on Bill 35 reveals that the real motive of this government is not to support low-income seniors but instead is to meet its budget d eadline.

The government fails to acknowledge not only the resistance but also the fear and the despair that its plans have produced in seniors, their families, and seniors' organizations. My questions are to the minister responsi- ble for seniors. Mr. Minister, would you just explain to Albertans for the record why you're invoking closure on Bill 35, that thousands have objected to? MR. DA Y: Mr. Speaker, the invoking of closure falls upon the Government House Leader in terms of the one introducing that motion; therefore, it is appropriate that I address it.

I like the moniker there: "habitual use of closure." It's now been used for the second time on a Bill. The only two times it's been used is when the Opposition House Leader in frankness to me has said: before it ever reaches the second reading stage or the committee stage, we will be forcing you to use closure; we will be using every trick, every strategy we can to drag this out." This is normal parliamentary strategy, and I appreciate it. As House leader I was informed by the Opposition House Leader that his caucus would be forcing us on Bill 35 to use closure.

That means we would be here all summer, all winter if we didn't do it. So that we can get to the committee stage of this Bill and get a very intense look at it, I have had to accept him at his word, and because we are being forced to, as they indicated, we are indeed invoking closure. 2:00 MRS. HEWES: Mr. Speaker, that's patent nonsense, and the member knows it. Nonsense, patent nonsense. I'd have liked an answer from the minister about closure, but I do have some other important questions for him. Mr.

Minister, since you're responsible for seniors, how or are you going to measure the consequences of the cumulative effects of changes to health, home care, housing, municipal/federal taxes on the economic well-being of seniors? How are you going to measure it? MR. MAR: Mr. Speaker, we will be monitoring those cumula- tive impacts in all those other areas. That is, of course, the whole point of having a minister responsible for seniors: to ensure that government is able to respond to changes as they take place. MRS. HEWES: Mr.

Speaker, will the minister, then, undertake to put in place a public process of monitoring using seniors' organizations to do the measurements and to report publicly and to this House? MR. MAR: Mr. Speaker, we have a good process in place now, and it doesn't require changing. MR. SPEAKER: The hon. Member for Calgary-Currie wishes to supplement. MRS. BURGENER: Y es, Mr. Speaker.

As chairman of the Seniors Advisory Council I would like to supplement and bring to the attention of the hon. member a comment that was delivered in this House on a similar question a few weeks ago in that the Seniors Advisory Council in response to its legislated mandate will be taking the issues raised by the consultation process that are separate from the Alberta seniors' benefit program back to seniors' communities, not only se niors' organizations but stake- holders who are involved – e.g., the municipalities, insurance groups – a whole bunch of issues that have been raised and will be delivering a report to the minister following that discussion.

I ask the member to refer to Hansard for that information I gave about two and a half weeks ago. MR. SPEAKER: The hon. Member for Lacombe-Stettler. Municipal Infrastructure Program MRS. GORDON: Thank you, Mr. Speaker. My questions today are to the Minister of Economic Development and Tourism. The infrastructure works program is a two-year $6 billion co-operative effort between all levels of government in Canada to invest in infrastructure renewal, upgrading, and development.

Welcomed by the 350 participating municipalities in Alberta, this program is designed and intended to stimulate productivity, improve competitiveness, facilitate future economic growth, and enhance job creation initiatives. It is estimated that administration costs will be $1.089 million for each of the provinces and the federal government. My question to the minister: why does such a basic program require such administration? MR. KOW ALSKI: Mr.

Speaker, when we announced this joint program, which is three levels – Canada, Alberta, and municipali- ties – there was a system put in place whereby there would be participation from one-third, one-third, one-third. That's not the same as it is in other provinces in the country. So we received,

2184 Alberta Hansard May 25, 1994 negotiated, and got confirmation from not only our municipalities in the province of Alberta but the federal government as well that there would be a management committee and in essence the applications would be funneled to the minister responsible, in this case myself, who would have the applications then go to the management committee. Then those that would have to go to Ottawa would have to go to Ottawa, and arrangements were also set up to have federal dollars come entrusted to us for forwarding to municipalities.

It becomes very complicated when you get involved in construction, because you have such mechanisms as holdbacks, partial payments, progress payments, and the like. So there's a very modest administrative entity set in place, and approximately half of 1 percent of the total budget will go to the administration of this program. MR. SPEAKER: Supplemental question. MRS. GORDON: Thank you, Mr. Speaker. Mr. Minister, what is included in the administration of the program? MR. KOW ALSKI: Mr.

Speaker, first of all, there has to be a check to make sure that, number one, the applications coming to the province have been duly authorized by the local municipality from whence they come. One of the conditions we have in Alberta is that every municipality must pass a bylaw or a motion of their council basically saying that this is the democratic, unanimous position of that council.

Secondly, what we do then in consort with our municipal partner – and Alberta is the only province in Canada that has a municipal representative on the management group – is make sure that in fact the type of project fits within the guidelines. Thirdl y , we have to make sure they also fit within the guidelines that we've had as a province, which are pretty generous and flexible, but, as importantly, the guide- lines of the federal government , who've entrusted to us or delegated us that clearing house mechanism. MR. SPEAKER: Final supplemental. MRS. GORDON: Thank you, Mr. Speaker.

Many municipalities have asked: why aren't the funds simply disbursed directly to them, as the grants are based on a per capita entitlement? MR. KOW ALSKI: Mr. Speaker, only based on per capita entitlement in Alberta. In no other province in the c ountry has such a mechanism been set up. In every other province in Canada the provincial government has interceded and basically taken the bulk of the dollars and then made provincewide decisions for the reallocation of those dollars. Only in Alberta have we agreed and found the mechanism that will be one-third, one-third, one-third, and that makes it very unique.

As importantly, the federal government then has to have different mechanisms for the delivery of dollars within the country of Canada, and they've been consistent in making sure that the dollars went to the provincial authority that assumes certain responsibilities under the program for them: the dissemination, being the clearing house. In the case of Alberta it's very simple, and for the most part the money will just flow right through the conduit to the spot. In other provinces, of course, the provincial government takes a chunk and redirects it to provincewide projects.

We're not doing that in Alberta; it makes us rather unique. MR. SPEAKER: The hon. Member for Edmonton-Whitemud. Quebec Separatism DR. PERCY: Thank you, Mr. Speaker. Y esterday in Vancouver the Premier mused aloud regarding Quebec separatism and a united western Canadian response. Two issues here: the first is that rhetoric without fact causes tremendous uncertainty in capital markets and with investors. The result is higher interest rates, less investment, and fewer jobs.

The second is that we must have some factual knowledge of what different constitutional scenarios pose for Canada, the west, and the rest of Canada before we speculate. My first question is to the Deputy Premier. Can the Deputy Premier tell us why the Premier decided to muse about the possibility of different constitutional arrangements in Vancouver when the Deputy Premier and Premier had the opportunity to discuss these rationally at the Western Premiers' Conference last week? MR. KOW ALSKI: Mr.

Speaker, the Western Premiers' Confer- ence in Gimli, Manitoba, last week was a very rational meeting of four western Premiers and two territorial leaders. Y esterday in this Assembly on behalf of the Premier I tabled some 1 1 communiqués that came out of the Western Premiers' Conference. If there's any theme that comes out of the Western Premiers' Conference, these are the themes. First of all, there's co-operation in western Canada among the four provinces and the two territories.

Number two, if there's any one region of Canada that is providing leadership in this country in terms of fiscal management, it is the four western provinces and the two territories. As an example, the only part of Canada, the only region of Canada, Mr. Speaker, as a grouping of six entities that will all have a balanced budget in 1996-97 will be western Canada. In fact, collectively, in this particular fiscal year the four western provinces and the two territories will have a combined cumulative deficit of $2.9 billion. Ontario alone has a deficit of some $7 billion more than that.

The message that came out of Gimli, Manitoba, the message that was echoed by the Premier of Alberta yesterday in Vancouver and was further echoed today by the Premier of Alberta in Vancouver is that western Canadians will lead the economic recovery of this country. Secondly, we're doing it together in harmony with one another, and we can show the rest of the nation that we can form alliances, that we can have harmonious arrange- ments, and we will not be divided by an entity out of Ottawa that would like to play the seven hills of Rome: a divide and conquer routine. 2:10 DR. PERCY: Mr.

Speaker, he evaded the question. It was a united west against Quebec. That was the issue he did not address. My second question is to the Deputy Premier. Has the Department of Economic Development and Tourism prepared any strategy to deal with the economic consequences to Alberta that would result from the Premiers' western union proposal, or is this sort of another example of policy-making on the fly or in a boat? MR. KOW ALSKI: Mr. Speaker, that's kind of disappointing language from a supposed learned man. Y esterday, Mr. Speaker, 1 1 communiqués were tabled in the House.

Perhaps the hon. member missed it yesterday. Communi- qué 1 says: The Economy, Jobs and Infrastructure. Well, if that doesn't fit in with what in essence the hon. member has asked for, I'm not sure. The second communiqué: Western Finance Ministers' Report. We can go through all of the communiqués. Well, here's communiqué 7: subject matter, Transportation.

May 25, 1994 Alberta Hansard 2185 Communiqué 1 1, Western Economic Cooperation. Communiqué 10, Western Regional Cooperation. To be very specific about the question raised by the member – have we all studied things? – yes. Any individual in Alberta who would like to get the package of the 1 1 communiqués, kindly contact my office. Let me make it very clear. My staff work beyond 4:30 or 5:30, and they can even phone them at their homes to get this information. I sincerely hope that that would be in keeping with what good employees should be doing. MR. SPEAKER: Final supplemental. DR. PERCY: Thank you, Mr. Speaker.

My question is to the Provincial Treasurer. Has the department of the Treasury assessed the impact on Alberta of alternate arrangements as proposed by the Premier, or is this again another example of policy-making on the fly? Do you have studies that stand behind what the Premier has said? MR. DINNING: Well, Mr. Speaker, first of all, we have some very learned work done by the Western Centre for Economic Research, that the professor from Edmonton-Whitemud has tabled in the Assembly today, and I'm sure that that tabling will also go into his curriculum vitae to know that it's also been tabled in the Assembly.

Y ou know, Mr. Speaker, imagine the Member for Edmonton- Whitemud on the eve of 1492 standing there beside Christopher Columbus as he's about to launch into the new world. The member would probably say: "Have you done a study, Chris? Have you done an efficiency audit? Y ou'd better be careful; it might be a flat earth out there." [interjections] MR. SPEAKER: Order. [interjections] Order. The hon. Member for Lethbridge-West. MR. DUNFORD: Mr. Speaker, why does it always happen just before my question? International Trade MR. DUNFORD: Mr. Speaker, my question is to the Deputy Premier.

In the new trade realities of north-south, Lethbridge of course is now a gateway to the south. That is why the export highway remains high on our agenda. Now, Lethbridge citizens are interested in what actually takes place at western Premiers' meetings. To that end the Prime Minister of Canada has often talked about the need for a team Canada approach in international trade. Are the western Premiers, none of whom are Liberals, prepared to be a part of this approach? MR. KOW ALSKI: Y es, Mr. Speaker.

Most determinedly the four western Premiers and the two territorial leaders basically talked about the team Canada approach, in fact have been advocating it for some period of time, and would welcome an invitation by the Prime Minister of Canada to in fact go to the Orient – and some of them have already been talking about that – in the fall of 1994. In addition to that, Mr. Speaker, I've also said this on many occasions in this particular Assembly: it is a welcome reality to us here in Alberta to meet a positive Liberal from time to time.

In the case of John Manley, who is the federal minister of trade in Canada, the relationship that we personally have is a very, very good one: first name, high respect, and great determination. Mr. Manley just called my office yesterday and was quite insistent that I attend the next meeting of internal trade ministers in this country because he really wanted to have Alberta's position there and believed that we are the best allies in dealing with this in a way. That same kind of attitude has been expressed now here in western Canada. We're a small country, a small nation.

Unless we co-operate, we will not get the best efficiency and effective- ness that we should. MR. SPEAKER: Supplemental question. MR. DUNFORD: Thank you. Again to the Deputy Premier: how did the western Premiers plan to deal with the current harassment by U.S. trade officials on Canadian agricultural products? MR. KOW ALSKI: Well, Mr. Speaker, the Hon. Roy MacLaren, who is a federal minister, has been very vocal in recent days pointing out Canadian concerns with respect to this matter.

Our minister of agriculture and rural development in the province of Alberta has made the views of Alberta very well known to the federal government. The Premier of the province of Alberta will be meeting with United States' ambassador to Canada, James Blanchard, as well as the governor of Montana in a matter of days and weeks from now to pursue that. As recently as a c ouple of hours ago several ministers of the Crown, the Provincial Trea- surer and the Minister of Energy, bid farewell to the American consul general in the province of Alberta, Mr.

Witting, who's now returning to Washington, D.C., to liaise, as I understand, between the White House and the American Senate about the importance of these concerns to the people of Alberta and to the government of Alberta. MR. SPEAKER: Final supplemental. MR. DUNFORD: Y es. Thank you, Mr. Speaker. Again to the Deputy Premier: is there any perceptible move toward decreasing the internal barriers to trade? MR. KOW ALSKI: There's a very significant move, Mr. Speaker.

At the last meeting that was held of ministers responsi- ble for internal trade in Canada, there was a significant move in a positive way to reduce trade barriers in this country by the province of Ontario, as an example. In Gimli, Manitoba, last week both the Premier of Saskatchewan and the Premier of British Columbia basically stressed their support for the arrival at a barrier-free Canada. The instruction was given to all of their various ministers who are involved in trade negotiations to in fact accelerate the negotiations.

They'll be meeting in New Brunswick within the next several weeks, and the target time is July 1, 1994, for the signature of such a document. MR. SPEAKER: The hon. Member for Leduc. Municipal Plebiscites MR. KIRKLAND: Thank you, Mr. Speaker. A plebiscite initiative by the citizens of a municipality is the purest of grass- roots consultation. The broadened taxation and decision-making powers of the municipal government in the proposed Municipal Government Act make it imperative that the citizens of a munici- pality have a fair and reasonable plebiscite mechanism in place.

The proposed Municipal Government Act states that a successful plebiscite must collect signatures from 10 percent of a municipal- ity's population within 60 days. My question is to the Minister of

2186 Alberta Hansard May 25, 1994 Municipal Affairs this afternoon. Why has the minister made it twice as difficult for the citizens of municipalities such as Edmonton and Calgary to launch a successful citizen-initiated plebiscite? DR. WEST: Mr. Speaker, this issue has been around for years as to the percentage that should be allowed for reasonable public participation to generate a plebiscite on certain issues, whether it be fluoridation or whether it be airports or what have you. History has been very interesting on this.

At one time everybody had agreed that it would be 10 percent for the cities and 5 percent for the rest of the smaller municipalities in rural Alberta. Well, that didn't seem fair on the day, so previous administrations came back and they changed it and made it 5 percent across the board for all 398 municipalities. Well, then we come back to this Act again. It's the next change of the Act, and it said: well, I think maybe it'd be better to go back to 10 percent. Obviously in a town of 300 people 5 percent is 15 people; 10 percent is 30. It doesn't seem reasonable.

And then it got into the argument: well, what about the city? Would it be any easier to collect 10 percent or 5 percent? What type of issue could you get those type of signatures on anyway: 5 percent is 40,000; 10 percent is 70,000? So there has been quite a history here. 2:20 What we did do, though – in February I went to the AUMA and said to them: "We have had requests from the city of Edmonton to move to 10 percent. It's one of your major populated areas within your association. Y ou represent 295 members.

Could you come back and tell me what the AUMA decision on this is by looking at the membership?" They wrote a letter in February from Mr. Bill Purdy saying: yes, we agree as representatives of the 295 municipalities that you move to 10 percent in the new MG Act. I'm surprised that this organization representing 295 municipalities including Edmonton and Calgary – these cities or aldermen that I hear talking are concerned over and above their represented group. MR. SPEAKER: Supplemental question. MR. KIRKLAND: Thank you, Mr. Speaker. Thanks for the history lesson.

My supplemental again to the minister: how can the minister justify the requirements for Calgarians and Edmontonians to collect between 60,000 and 70,000 signatures for a su ccessful plebiscite when 46 members of this House can cause a province- wide plebiscite on capital punishment, a federal issue? DR. WEST: Mr. Speaker, I think that this would be a good topic for a broad debate in this Legislature. Speaker's Ruling Anticipation MR. SPEAKER: The Chair would point out that it would be a good topic for a broad debate, and the forum is readily available in Committee of the Whole. This Bill is in committee.

Is there a final supplemental that may not offend against the rules of our Assembly? Municipal Plebiscites (continued) MR. KIRKLAND: Thank you, Mr. Speaker. Well, in view of the growing opposition from Edmonton and Calgary, is the minister willing to accept a Liberal amendment to set the required signatures of municipalities of 100,000 and above at 5 percent? Speaker's Ruling Anticipation MR. SPEAKER: Order. That question should really be asked in committee. [interjections] Order please. The hon. Member for Cypress-Medicine Hat. MR. WICKMAN: Mr. Speaker, a point of order. A point of order.

Gasoline Station Closure DR. L. TA YLOR: Please, Mr. Speaker, could we have some sanity here? [interjections] Stop the insanity. Stop the insanity. MR. SPEAKER: A proper prologue, please. DR. L. TA YLOR: In a meeting this morning with constituents from the county of Forty Mile a number of important issues were raised. One of the concerns relates to the MUST program. This program is forcing small rural gas stations out of business as they cannot afford to meet the requirements of the program.

If we were to travel a highway across southern Alberta, once the two stations in Foremost are closed – and they're in the process of doing just that – there will be a stretch of highway 320 kilometres long, which is part of the Red Coat Trail, with no gas station: 320 kilometres. The Red Coat Trail is a major tourist destination with increasing traffic every year, yet the government is forcing a reduction of services. My questions are to the Minister of Labour. Why is it necessary to force rules which are appropriate to large urban areas onto rural Alberta where they are not appropriate? MR.

DA Y: Strictly on the issue of appropriateness of rules, Mr. Speaker, the issue of aging tanks underground having the possibil- ity of leaking is something that is very serious. Actually about 38 percent of all municipal drinking water comes from underground wells, and about 87 percent of all of the water that's used to water livestock comes from underground wells. If you have a tank that's leaking, one litre of gasoline can actually contaminate an underground aquifer, up to a million litres of water, and render that aquifer contaminated for decades.

So in terms of appropriate- ness of rural/urban, there's significant concern in the rural areas about this possibility, and that's why there's a joint effort between the departments of Labour and environment to try and address the issue. MR. SPEAKER: Supplemental question. DR. L. TA YLOR: Thank you. Is the minister aware that as the two gas stations in Foremost are closing, my constituents in the southern end of the constituency may have to travel up to 50 miles to get a tank of gas? MR. DA Y: Mr. Speaker, I don't know the details on why those gas stations would be closing.

I would invite the owners of those gas stations – if it's problems related to safety standards in the removal of those tanks or environmental standards in terms of decontamination, we would want to work together with those operators to see what we might be able to do. I would also comment that Alberta is known for its entrepreneurial spirit. If there's a stretch of highway 320 kilometres long with no gas

May 25, 1994 Alberta Hansard 2187 station, I can guarantee you that there will be people w illing to move in there and set one up. DR. L. TA YLOR: As it costs a minimum of $20,000 and more likely closer to $100,000 to install new above-ground tanks, will the minister provide some sort of relief for communities such as Foremost that are facing this very serious situation brought on by his department's regulations? [interjections] MR. DA Y: The Liberals think this is a funny issue. It's not, and I'm glad that the member has raised it and is concerned enough about his constituents that he has raised it.

I can assure him that this issue is being looked at in the hands of an industry and consumer association. The Petroleum Tank Management Association is looking at this, and again it's a combination of industry, wholesalers, retailers, and consumers looking at it. Indeed they have looked at how a fund could be set up so that if there's a possibility that stations cannot afford to do the removal or the remediation, there could be dollars made available to assist them with that. We would want to hear from those particular operators to see what we might be able to do to help their situation. MR. SPEAKER: The hon.

Member for Edmonton-Ellerslie. Job Creation MS CARLSON: Thank you, Mr. Speaker. In the provincial budget the government admitted that it was prepared to sacrifice jobs when dismantling education and health care. Now the Conference Board of Canada's spring 1994 outlook reveals that unemployment growth for Alberta has been revised downwards by 10,000 jobs in 1994 and 13,000 in 1995 as a result of this government's poorly planned budget.

To the minister without portfolio: how can this government say that they are committed to promoting the conditions which will lead to job creation when the Conference Board is projecting a reduction in job growth of 23,000 jobs over the next two years? MRS. MIROSH: Mr. Speaker, I welcome the question. The government does not create the jobs or the wealth; it's private sector. Government creates avenues for jobs. Alberta Research Council, for instance, tomorrow will be announcing in Calgary an additional 200 jobs, a partnership between Alberta Research Council and the private sector.

Also, the Alberta Opportunity Company has projected a significant increase in jobs as a result of some loans that we've given them, and the list goes on. Again, we have created 40,000 new jobs in Alberta. MS CARLSON: Promised but not created. What are you going to do about the fact that this Conference Board has found only 2,500 full-time jobs created for women and, in actual fact, a .5 percent decrease in job creation and an increase in unemployment for women over the past year? MR. MITCHELL: Dianne has a job. MRS. MIROSH: Mr. Speaker, so does the hon. member across the way, for a very short time. Mr.

Speaker, we have been able to create a number of jobs in co-operation with the private sector. Governments are not in the business of creating jobs. The private sector is, and we've been very successful. I repeat again, through Stats Canada, that we have created 40,000 new jobs in the province of Alberta, and you can read the stats yourself. MS CARLSON: Just no jobs for women.

If you're so interested in promoting job creation, why has this government failed to present Albertans with an implementation plan for Seizing Opportunity for over one year and i gnored the recommendations of the Alberta Tax Reform Commission for the past four months? MRS. MIROSH: Well, Mr. Speaker, we are consulting with a number of groups of people about Seizing Opportunity. As a matter of fact, it's a document that's well endorsed. The Alberta advantage is well endorsed through a number of organizations and groups, and we have received a lot of help from the private sector in endorsing the Alberta advantage.

We're working together to continue to create jobs, and we'll do that. It's ongoing. It doesn't just happen overnight. It is a successful program, and MLAs throughout the Legislative Assembly are assisting in their own constituencies in workshops in job creation. People in the communities are helping, and the Alberta advantage is working. MR. SPEAKER: The hon. Member for Lesser Slave Lake. 2:30 Housing Programs MS CALAHASEN: Thank you very much, Mr. Speaker. I've received many calls from constituents concerned with the possible elimination of all programs under housing.

One of the main concerns is the possible elimination of the rural and native housing program and the rural housing assistance program. Residents of northern communities do not enjoy the options other Albertans do, such as easily accessible rental accommodation, and due to the level of poverty in some areas of the north many people cannot easily obtain a mortgage. My question is to the Minister of Municipal Affairs. What are your intentions with respect to these two programs? DR. WEST: Mr.

Speaker, the policy behind these two programs was generated by the federal government, and the moneys were shared on a 75-25 cost sharing with the federal government. We administered the program for them. Over the years the rural native housing and the repair program have been very expensive programs. The federal government has backed off on many of the dollars they have available for this and stopped the cost-shared program as of January 31. We no longer build rural native housing, and we are working on selling off those that are no longer needed. There is a thing that shocked me the other day.

When I looked at this program in its entirety and its history, I found that only 18 percent of it was built in native communities. The rest was built in other communities and probably in areas where the housing was not a need. In fact, it was one of those things that if you provide the money, we'll find the construction, build them. So we're going to look at this whole issue: sell off the houses or transfer them to the owners of the houses where that can be done and, as I say, work with the federal go vernment to see where they're going in the future. MR. SPEAKER: Supplemental question.

MS CALAHASEN: Thank you, Mr. Speaker. I'm very pleased to hear that we are starting to look at different ways of dealing with housing. But if we are phasing these programs out, what does the Minister of Municipal Affairs propose to do to address

2188 Alberta Hansard May 25, 1994 the housing needs in northern communities, which do not have many alternatives for housing? DR. WEST: First of all, we're going to pass Bill 34, which gives a tremendous amount of flexibility in the new housing Act. It'll also give a new direction to the Alberta social housing program, which used to be Alberta Mortgage and Housing Corporation.

In talking with the minister of social services, in areas such as yours we will be looking at the job corps program plus a new policy in remote housing and get more in itiative by the individuals in the building and in the development of the houses both by themselves, the individuals, and the communities. I look forward to develop- ing a policy along with various members in the House from the north that will address specific needs in specific areas rather than making blanket policies that end up like rural native housing did: inadequately addressing social needs. MR. SPEAKER: Final supplemental.

MS CALAHASEN: Y es. Thank you, Mr. Speaker. When we're talking about housing and a need for it, there's got to be a management scheme in place. Could you then please elaborate on what kind of a management scheme we would be looking at relative to the housing needs of the north? DR. WEST: Well, that poses quite a challenge, and I'd ask the hon. member to bring forth some suggestions.

We're certainly going to put a team together in what's left of Alberta Mortgage and Housing Corporation, the new Alberta social housing program, but we will have to work with those communities and work with other departments to disentangle this overlap that we've had and put together a team that will be able to source need rather than source just individuals. I don't want to ever end up with the program we had before: if we provide the money, we'll find the clients. First, I want to establish what need is.

We'll put a team together, and when we can assess that properly, then we'll direct these remote housing programs to the people who require them. MR. SPEAKER: Order. The time for question period has expired, but before moving on, could we have unanimous consent to revert to Introduction of Guests? HON. MEMBERS: Agreed. MR. SPEAKER: Opposed? Carried. head: Introduction of Guests (reversion) MR. DA Y: Mr. Speaker, on behalf of my colleague the Member for Red Deer-South I am delighted to introduce to you today students, parents, and teachers from the M ountview elementary school.

There are approximately 70 from that group visiting us today. The teachers are Greg Atkinson, Bruce Strand, Andrée Caron, and David Cozens; assisting are parents and helpers Nellie Perlick, Mike Koselek, Cindy Oxman, Maryann Brown, Mrs. Riopel, and Philip Mah. I would ask them to all stand and receive the warm welcome of the Assembly. MR. SPEAKER: The hon. Member for Edmonton-Rutherford had a point of order. Point of Order Brevity MR. WICKMAN: Mr.

Speaker, Beauchesne 417 clearly states, "Answers to questions should be as brief as possible." As this session goes on, it becomes almost like a contest on that side as to who can speak the longest in terms of answering a question, and I think it's done for a reason. I think it's done because they want to minimize the number of stingers that come over from this side, so they talk and talk and talk. I'm simply asking that some enforcement be put down. Like with our questions that are nice and brief, the responses should be the same way. MR. DA Y: Mr.

Speaker, there is in fact no point of order, and an analysis will reveal some very interesting statistical informa- tion, that in fact the vast majority of time taken on

preambles is by the members of the opposition, not by members on this side. [interjections] MR. SPEAKER: Order. [interjections] Order. Well, the Chair believes that all members know the rules regarding questions, but if the hon. Member for Edmonton-Rutherford feels that there's been some slippage in the crisp and rippling replies normally associated with most government ministers, the Chair will try to analyze the situation. If it in fact is borne out, the Chair will try to be more diligent in encouraging what's required. head: Royal Assent MR. DA Y: Mr.

Speaker, His Honour the H onourable the Lieutenant Governor will now attend upon the Assembly. [The Deputy Premier and the Sergeant-at-Arms left the Chamber to attend the Lieutenant Governor] [The Mace was draped] [The Sergeant-at-Arms knocked on the main doors of the Chamber three times. The Associate Sergeant-at-Arms opened the door, and the Sergeant-at-Arms entered] 2:40 SERGEANT-AT-ARMS: All rise, please. Mr. Speaker, His Honour the Lieutenant Governor awaits. MR. SPEAKER: Sergeant-at-Arms, admit His Honour the Lieutenant Governor. [Mr.

Speaker left the Chair] [Preceded by the Sergeant-at-Arms, His H onour the Lieutenant Governor of Alberta, Gordon Towers, and the Deputy Premier entered the Chamber. His Honour took his place upon the throne] HIS HONOUR: Please be seated. MR. SPEAKER: May it please Y our Honour, the Legislative Assembly has, at its present sitting, passed certain Bills to which, and in the name of the Legislative Assembly, I respectfully request Y our Honour's assent.

May 25, 1994 Alberta Hansard 2189 CLERK: Y our Honour, the following are the titles of the Bills to which Y our Honour's assent is prayed. No.

Title 1 Labour Boards Amalgamation Act 2 Alberta Sport, Recreation, Parks and Wildlife Founda- tion Act 5 Oil and Gas Conservation Amendment Act, 1994 6 Mines and Minerals Amendment Act, 1994 1 1 Dairy Industry Amendment Act, 1994 12 Brand Amendment Act, 1994 13 Livestock Identification and Brand Inspection Amend- ment Act, 1994 14 Agriculture Statutes Repeal Act, 1994 15 Alberta Energy and Utilities Board Act 16 Government Land Purchases Act Repeal Act 17 Treasury Department Statutes Amendment Act, 1994 19 School Amendment Act, 1994 21 Alcohol and Drug Abuse Amendment Act, 1994 23 Provincial Offences Procedure Amendment Act, 1994 27 Rural Gas Act 29 Nova Corporation of Alberta Act Repeal Act 32 Fuel and Tobacco Tax Statutes Amendment Act, 1994 Pr. 1 Mandy Anderson Adoption Act Pr. 4 Concordia College Amendment Act, 1994 Pr. 7 Scott Peter Lavery Adoption Act Pr. 12 Travis Trevor Purdy Adoption Act Pr. 14 Jody Anne van Overmeeren Adoption Act CLERK: These are the Bills to which Y our Honour's assent is prayed. [The Lieutenant Governor indicated his assent] CLERK: In Her Majesty's name His Honour the Honourable the Lieutenant Governor doth assent to these Bills.

SERGEANT-AT-ARMS: All rise, please. [Preceded by the Sergeant-at-Arms, the Lieutenant Governor and the Deputy Premier left the Chamber] [Mr. Speaker took his place in the Chair, and the M ace was uncovered] MR. SPEAKER: Please be seated. head: Orders of the Day head: Written Questions MRS. BLACK: Mr. Speaker, I move that the written questions appearing on today's Order Paper stand and retain their places. [Motion carried] head: Motions for Returns MRS. BLACK: Mr.

Speaker, I move that the motions for returns on today's Order Paper stand and retain their places. [Motion carried] head: Public Bills and Orders Other than head: Government Bills and Orders head: Second Reading Bill 213 Loan Guarantees Statutes Amendment Act, 1994 [Debate adjourned May 24] MR. SPEAKER: The hon. Member for Calgary-North West. MR. BRUSEKER: Thank you, Mr. Speaker. I am pleased to enter into the debate on Bill 213, a nice short Bill with very clear objectives and very clear intentions.

The reason I'm so pleased to enter the debate today is I wanted to follow hard on the heels of the government members who were arguing in favour of loan guarantees. The debate adjourned yesterday afternoon with the Member for Cypress-Medicine Hat just finishing off his comments here, saying he would "encourage all members to vote against Bill 213." Well, voting against Bill 213 can only be interpreted as support for loan guarantees. Point of Order Imputing Motives DR. L. TA YLOR: A point of order, Mr. Speaker. Beauchesne 459, imputing motives.

Certainly I didn't intend that, and I want to be very clear that is not what my comments referred to. MR. BRUSEKER: Mr. Speaker, I guess he just wants a direct cash payment. Since in his comments he's going to vote against the Bill, I can only conclude, therefore, that he's not in favour of what the Bill says, and the Bill says: let's get rid of loan guarantees from the Department of Economic Development and Tourism. So that's the conclusion that I came to following his interesting comments, I guess, for lack of a better term. Debate Continued MR. BRUSEKER: Mr.

Speaker, the member says in his comments – and I found his comments really interesting, so interesting I went back to Hansard of yesterday to review his comments. He says, "This is a new and different government with new and different ways of doing things." Well, certainly Bill 19 bears that out. But one of the issues that is still a concern is in fact the issue of loan gua rantees.

In fact, it's so bad with respect to loan guarantees and the ongoing development of loan guarantees that now the government has institutionalized the delivery of loans and loan guarantees through in particular two programs that I particularly want to mention. One is the Alberta Opportunity Company, which falls under one of the ministers, the minister without portfolio's responsibility, that provides loan guarantees to banks, I think was the phrase that was used when we were debating the estimates in this Legislature some, oh, month or month and a half ago.

Indeed, the government further passed a Bill, Bill 21 . . . Point of Order Questioning a Member DR. L. TA YLOR: A point of order. Will the member opposite accept a question? 2:50 MR. BRUSEKER: Absolutely.

2190 Alberta Hansard May 25, 1994 DR. L. TA YLOR: I'm just wondering if . . . MR. SPEAKER: The hon. Member for Cypress-Medicine Hat. AN HON. MEMBER: Let the Speaker get in. DR. L. TA YLOR: Oh, sorry. I'm just wondering if the member is opposed to the philosophy of Alberta Opportunity supporting and encouraging the growth of small business in Alberta. MR. BRUSEKER: Oh, certainly I'm happy to answer that, Mr. Speaker. I certainly support the philosophy of promoting and developing small business in the province of Alberta.

I do not believe that Alberta Opportunity Company is the vehicle to do that. [some applause] Thank you for that support. I'm really pleased with that support that I'm getting from members opposite. Part of the reason is very simply the track record of the Alberta Opportunity Company. They have so far, at last count, I think a $34 million accumulated deficit. The previous minister of economic development and trade, the hon. Peter Elzinga, who was in the 22nd Legislature, tabled in this House a list of some 30 what he referred to as success stories with respect to the Alberta Opportunity Company.

When I reviewed that list – and I don't have the list right in front of me at this moment – it talked about creating jobs, and when you calculated the dollars that were loaned or guaranteed versus the jobs that were created, I seem to recall it was about $180,000 per job that we placed at risk under the Alberta Opportunity Company. So I have some severe concerns about the operation and indeed loan guarantees. Debate Continued MR. BRUSEKER: Now, with respect to loan guarantees in particular, again through this one I was just starting in with reference to Bill 21, that dealt with local opportunity bonds.

Now, I forget the exact title of that Bill, but it allowed for unlimited loan guarantees that again are going to be administered or controlled or directed, however you want to call it, through the Alberta Opportunity Company. I have some concerns about the way it was proposed, because as I recall, the loan guarantee could be for up to 100 percent of the amount of the loan that was being undertaken for whatever small business project or perhaps large business project was being undertaken. So up to 100 percent, number one, was a concern.

Number two concern that we had with that particular issue was the fact that there was no cap as to the size of the loan. In other words, you could have had a loan for a million dollars, $5 million, potentially a hundred m illion dollars under that particular program. So no limit to the amount percentagewise and no limit to the amount dollarwise either. Those were certainly two concerns that we had on this side of the House with respect to Bill 21, which I seem to recall debating here in the wee hours of the morning on November 10 of last year. Mr.

Speaker, the concern with loan guarantees is also carried over to the Alberta finance corporation, which now replaces the Alberta Agricultural Development Corporation, at least in title, and we see again loan guarantees recently for Beatrice Foods for a cookie plant. So on one hand the government says, "Gee, we're getting out of the business of loan guarantees," yet there are two institutionalized companies that ar e involved directly with loan guarantees. Now, Mr. Speaker, my argument would be that as far as the taxpayer is concerned, they don't care why the government loses a dollar.

They just don't want the government to lose the dollars anymore. When you have tw o institutions still giving loan guarantees, whether it comes directly from approval by cabinet and in part the Alberta Opportunity Company as part of the Department of Economic Development and Tourism or whether it comes out of a department, if the dollars are lost, if the dollars are placed at risk, Albertans don't benefit.

For that reason, certainly the last election campaign in June of last year there were a number of individuals, I would suggest, from both parties that were going out saying, "Let's not have loan guarantees." Now, one of the issues that I heard the Member for Calgary- Varsity expressing concern about is the idea that this particular Bill only deals with loans under the now amalgamated Department of Economic Development and Tourism. Just taking it back a little bit.

The reason for three of the four sections that are there in the Bill is that the current Department of Economic Develop- ment and Tourism is really an amalgamation of the former departments of economic development and trade, technology, research and telecommunications, and the department of tourism, now amalgamated into one department that we're now calling in this Legislature the Department of Economic Development and Tourism.

The proposal put forward by the Member for Edmonton-Ellerslie dealing with those three in particular is simply for the reason that the Member for Edmonton-Ellerslie is responsi- ble as a member of the Liberal opposition for being the critic for the Department of Economic Development and Tourism. So the focus was: let's deal with those issues that are in particular related to the area for which she has responsibility.

Now, I must say that I was really pleased to hear the Member for Calgary-Varsity say, a quote from page 2134 of Hansard: My concern over the issue of loan guarantees and indemnities does not stop at the Department of Economic Development and Tourism, as does the member opposite's. Well, I don't think the member opposite necessarily stops with the Department of Economic Development and Tourism.

But then the member continues and says: My concern lies with loan guarantees and indemnities throughout the government, including the Students Loan Guarantee Act, the Motion Picture Development Act, the Department of Culture and Multiculturalism Act, and the list goes on. That's also from page 2134 of Hansard. Well, I appreciate that, and I would therefore anticipate that that member is going to be supporting our Bill 213, is going to be saying: "Y es, let's put a legislated stop to the issue of loan guarantees.

Let's put this whole issue to rest so we don't have to worry about it anymore." In fact, I would anticipate that the Member for Calgary-Varsity will be proposing all kinds of additional amendments that will limit loan guarantees not only in this one department but in fact in other departments and will bring forward positive suggestions and amendments for this particular Bill when we get to Committee of the Whole.

I would suggest, unlike what happens to some of our amendments when we propose them to the government, that if the hon. member opposite brings forward such amendments and proposes positive improvements and changes to the Bill, we would embrace those amendments on this side, because we are certainly much more open to that idea and we are more liberal in our thinking on those particular issues. So certainly that's something we want to support, and I look forward to the member's support at second reading, and I look forward to the member's support of the Bill at the Committee of the Whole stage. Mr.

Speaker, the Member for Cypress-Medicine Hat raised sort of a rhetorical question, I would gather, when he raised the issue

May 25, 1994 Alberta Hansard 2191 of: how is it different from the government interfering in the marketplace by giving loans and guarantees to business on one hand and by extending student loans on the other hand? Somehow the member doesn't seem to accept or see that there's a difference between business loans and student loans. I thought I might take a moment – and this may be a futile attempt on my part. I accept that, but I'm going to try anyway to see if I can't make it clearer for that member, because I think there is a fundamental difference between those two issues.

On one hand, loan guarantees – I'm talking loan guarantees to businesses here – apply to a very select number of businesses. Of the thousands of businesses across this province – large, small, and in between – a very small number of them will ever get a government loan or a government guarantee, which therefore makes it an unlevel playing field for all people in the business sector. That's a concern we've had on this side: inequity created by these kinds of programs. Student loans on the other hand are equally accessible by all individuals who want to attend and can qualify for student loans.

There's no: this guy has a Tory membership card in his back pocket or doesn't. We look at the student. We look at what his or her credentials are, and then the student is given the loan. There's nowhere near the involvement in student loans and interference with student loans as there is with respect to busi- nesses. So from that standpoint there is a significant difference between students on one hand and businesses on the other hand. Now, I hope that clarifies things for the hon. member. I'm not sure if it will or not. I don't know if he had any success or lack of success with respect to student loans.

I must confess that I don't have a great deal of personal experience. I managed to get through university without ever having a student loan given to me, because I never needed one. 3:00 MR. N. TA YLOR: Capitalist. MR. BRUSEKER: Y eah, I guess I'm a capitalist. I ended up working my way through school and had scholarships as well, so I didn't need student loans and managed to get by without them. But for those students that need them, there should be access to them on an equal, equitable, and fair basis.

I guess what the member is saying is that we should have student loans that are somehow – I don't know how he would propose to do this even – given to some students and not others in the same way as what the Alberta Opportunity Company does for example with respect to other loans. I guess my concern with the whole issue of government loans and loan guarantees however is a little broader with respect to: where are we going from here? Members opposite like to say: "Well, this is a new government. It's a forward-looking govern- ment.

Things are going to be new and improved and exciting and wonderful." Often we hear comments along that line with respect to where the government is going. So on one hand we get a government that says that we're new and we're different. We start with some proposals with respect to Toward 2000 Together, and certainly that's an initiativ e of the government. Different groups and different places and different organizations across this province have made submissions to the government and said: "Gee, here's what's going on in other jurisdictions. Here are the kinds of things that are going on and happening.

How can we develop that?" Mr. Speaker, we in the Liberal caucus have said for example that one of the things we need to do is promote jobs. I introduced a Bill recently in the House dealing with flexible networks that again talked about promoting jobs. In fact, this evening there's a dinner meeting of a group called the Calgary Council for Advanced Technology, and this particular group is talking about flexible networks.

In fact, one of the speakers is going to be a representative from the Canadian Manufacturers' Association who's going to be talking about: how can we promote jobs and how can that help us diversify our economy? What we talk about in Bill 213 is that the way to diversify the economy is not through loan guarantees. We need to look at something else. We need to look at increasing trade. We need to look at reducing not increasing trade barriers.

On one hand, we have the government talking about, "Gee, let's reduce interprovincial trade barriers." Then we have ministers of the government saying: "Well, gee, if B.C. doesn't respond, then we're going to put up our trade barrier on this issue, or if they don't respond in Saskatchewan, we're going to put a trade barrier on that issue." The end result, of course, Mr. Speaker, is that it doesn't promote the development of our economy. That's really what Bill 213 talks about.

That's what Bill 21 1 talked about, that we dealt with before: how can we get more people working, how can we make our economy more robust and growing and exciting and developing? Mr. Speaker, Bill 213 that we have before us today simply deals with admittedly a small slice of what has gone wrong in the past, because there have been many things that have gone wrong in the past. It deals with one, and it builds on what the govern- ment has said: this is forward looking; we don't have to look back at the old policy. Bill 213 really says: let's get rid of that old policy. And what was that old policy?

In the Department of Economic Development and Tourism part of that old policy was loan guarantees. What this Bill says is: let's put that behind us; let's get rid of it; we don't need it anymore. We hear members opposite saying that we don't need them anymore. Loan guaran- tees are a thing of the past, with the exception of a couple I've mentioned, the Alberta Opportunity Company and the Alberta finance corporation. But by and large we don't need loan guarantees. They agree. We agree. Therefore, I expect all members will probably support vigorously Bill 213 when it comes to a vote shortly. Thank you, Mr. Speaker.

MR. SPEAKER: The hon. Member for Vegreville-Viking. MR. STELMACH: Thank you, Mr. Speaker. I appreciate the opportunity this after noon to speak to Bill 213. In speaking against Bill 213, I would like to make it very clear to all Members of the Legislative Assembly that I personally remain against the use of loans and loan guarantees as a means to encourage economic development in the province of Alberta.

The Financial Review Commission in its recommendations to the government of Alberta last spring put forward the recommen- dation that the government no longer use loans and loan guaran- tees as a means to carry out government policy. That recommen- dation, Mr. Speaker, was accepted by the government wit hout hesitation. The Financial Review Commission further recom- mended that in the future where loans and loan guarantees are deemed necessary, they receive the approval of this Legislature or an all-party committee.

Again, the government of the day acknowledged the recommendation and indicated that it would look into the possibility of some type of legislated limits on this type of activity. Evidence of the government's acceptance of the

2192 Alberta Hansard May 25, 1994 Financial Review Commission's recommendations can be found in the fact that this government has not issued a loan or loan guarantee since the last provincial election held on June 15, 1993. In light of this fact, the hon. Member for Edmonton-Ellerslie has brought this private member's Bill proposing the removal of

section 10 from the Department of Technology, Research and Telecommunications Act and

section 9 from both the Department of Tourism, Parks and Recreation Act and the Department of Economic Development and Trade Act. The purpose of this would be to eliminate the ability of the government of Alberta to enter into loans, loan guarantees, and indemnities for reasons specific to the above-mentioned sections. In fact, Mr. Speaker, this would not be the case. It has already been mentioned that there are some 20-plus legislative provisions which would allow this government to enter into loans and loan guarantees, none of which is more general as to purpose than the provisions in the Financial Administration Act under

part 7, sections 72 to 76. If Bill 213 were to be passed by this Legisla- ture, there would be no restrictions placed on this government in respect of its ability to offer lo ans and loan guarantees to busi- nesses in Alberta. In fact, the only real limit that could possibly be placed on this government in its ability to enter into loans and loan guarantees would be the wrath of the people of Alberta. Being a newly elected member of this Legislature I ran on a platform of open, accountable, and honest government.

I ran based on a government that would be fiscally responsible to the taxpayers of Alberta and would no longer offer loans and loan guarantees to encourage economic development in the province of Alberta. Mr. Speaker, I don't require a pi ece of legislation to ensure that I keep my promises, nor does the Premier of Alberta, nor does this government. I might add with some concern, however, that the Liberal Party ran on a campaign of brutal cuts and about $1.1 billion in spending in the first year.

However, as far as I've been able to determine, they have in fact been asking this government to slow down its balanced budget program and not reduce its spending. Perhaps they should consider some kind of legislative provision which would require them to keep their election promises. I am concerned that the debate today will focus too much on the failures of past governments in regards to loans and loan guaran- tees issued as much as 10 years ago.

While I was not a member of the government during that period of time when the majority of loans and loan guarantees were issued and while I remain opposed to such guarantees at the present time, I acknowledge the fact that previous governments may have felt that there was a legitimate role for it to play in attracting business to Alberta and in diversifying the Alberta economy. In fact, Mr. Speaker, I might also add that Albertans believed there was a role for the government to play in ensuring economic prosperity in the province.

While this province has certainly suffered from the failures of the past, it has most definitely benefited from the successes. The Alberta Treasury Branches, Nova Corporation, and Alberta Energy Company are a direct result of past provincial governments exercising their financial power to assist Albertans. 3:10 What about the Alberta heritage savings trust fund? That fund was created by collecting oil royalties and setting them aside to help Albertans in the future. The mind-set at the time was: why shouldn't the government create this fund and use it to make Alberta a better place?

It was the product of a mind-set which believed that the government should be in a position to use its financial power to encourage growth and prosperity in the province. We used these funds to help develop Syncrude, to help Alberta students attend postsecondary institutions, and to buy medical equipment for hospitals. The Alberta heritage savings trust fund has been used to create jobs in Alberta and to make this province a better place to live.

My concern is that we accept the decisions that were made in the past, both good and bad, and move on to the decisions that this government is making today and will make tomorrow. Bill 213 deals solely with loan and loan guarantee provisions and Acts under the control of the Department of Economic Development and Tourism. The issue is not simply about loans and loan guarantees to businesses but about loan guarantees offered to students in this province. It is about loans and loan guarantees to farmers through the Alberta Opportunity Company and the Agriculture Financial Services Corporation.

Since its inception in 1972 the Alberta development corporation, now a part of the Agriculture Financial Services Corporation, has made more than 139,000 loans or guarantees to Alberta pr oducers and agribusinesses, enabling thousands of farmers to get a healthy start in agriculture. Is the opposition opposed to the operation of this program? If so, why haven't they stood up and made their objections public? DR. WEST: How much did they lose? MR. STELMACH: None. No money. In fact, we're now operating with the revenue that's coming back from Alberta's financial services corporation and being loaned right back.

In fact, the cost of the operation of ADC is only 2 percent, which is lower than any other bank in Alberta, the most efficient. Why am I arguing with you anyway? DR. WEST: Well, the capital investment isn't included in that. Come on. MR. STELMACH: The offices are there to begin with, so we're not losing anything on the capital. [interjections] Y eah, tell the minister here to . . . Y ou can't just hide behind the issue of loans and loan guaran- tees to businesses and the failures associated with them. Y ou must also accept res ponsibility for a position on guarantees and loans to farmers or students.

In this current year alone the government will provide over $100 million worth of assistance to students in the form of loans and loan guarantees. What is your position on this issue? If I am correct in my recollection, when the Minister of Advanced Education and Career Development announced that the govern- ment was getting out of the business of issuing loan guarantees to students, the opposition was enraged. Point of Order Relevance MR. CHADI: A point of order, Mr. Speaker. MR. SPEAKER: The hon. Member for Edmonton-Roper rising on a point of order. MR. CHADI: Y es, Mr. Speaker. Beauchesne 459, relevance.

We're talking about Bill 213 here, which is quite clear about repealing the loan guarantee sections of the Economic Develop- ment and Trade Act, the Department of Technology, Research and Telecommunications Act, the Department of Tourism, Parks and

May 25, 1994 Alberta Hansard 2193 Recreation Act, and lastly, the Development and Trade Act. What does that have to do with education and farmers? So please let him come to the point here. It's got nothing to do with farmers and student loans. We're talking about loans to busi- nesses. It's quite clear in the Act. Rule on it, please. MR. SPEAKER: The hon. Member for Vegreville-Viking may wish to connect the complaint to his comments. MR. STELMACH: Okay. What I'm saying this afternoon is very relevant to Bill 213. We're talking about not only the philosophy.

If the opposition across the way is really serious about eliminating loans and loan guarantees, they could do it in a heck of a lot better fashion than they could under a Bill like 213, which really has no teeth to it whatsoever. A little bit of grand- standing. Debate Continued MR. STELMACH: Before I was so rudely interrupted, Mr. Speaker – I've kind of lost my spot here in the speech. It's time for some consistency in the way the opposition addresses the issue of loan guarantees. I am against Bill 213 because of the narrow-minded approach to the issue of loan guarantees.

Perhaps this Bill would be better received if it dealt with the consolidation of all loan guarantees and indemnity provisions under one Act. I think that had this Bill been presented in such a fashion, it would have been a much better Bill. As it stands, however, I feel that to pass this Bill to committee would be a waste of this Assembly's time. The government does not require the provisions put forward in Bill 213 to keep its promise to Albertans. Therefore, Mr. Speaker, I would encourage all members of this Assembly to vote against Bill 213. MR. SPEAKER: The hon. Member for Edmonton-Roper. MR.

CHADI: Thank you very much, Mr. Speaker. I can promise you that I'm going to stick to the Bill that's before us, 213, as presented by the Member for Edmonton-Ellerslie. I think it's a rather timely Bill. It's one that has been talked about for an awfully long time. The Premier of the province has been going around saying that we're going to get out of the business of being in business; we're going to get out of loan guarantees provided to businesses.

The minister of economic development, tourism, and trade has been saying the same thing, and I know – I know full well – that the Provincial Treasurer would want to, deep down in his heart, back Bill 213. Y ou know, I'm going to be quite curious to see how the Provincial Treasurer is going to vote on this one. Mr. Speaker, I was quite surprised to listen to the debate from both sides of the House yesterday and today and to hear in particular the debate and comments that were coming forward from members on the opposite side. Y ou can't have it both ways.

Y ou've got to either say that you're for something or you're against something. Y ou can't say on the one hand that you're against it in the public but in a forum such as the Legislative Assembly sit back and sort of sneak around the issue. I think we have to, all of us, say it as it is. Right now I'm looking at Hansard, page 2134, from yesterday's debate. The Member for Calgary-Varsity goes on to say that "We probably don't need to hear the opposition reinforcing this, because in effect they're supporting our existing policy." Oh, no kidding.

We're supporting their existing policy, their policy of no loans and loan guarantees to business. Well, if that's the case, Mr. Speaker, if you're going to talk the talk, you've got to walk the walk too. Y ou just can't go halfway. Y ou just can't say on the one hand that you're going to do something and then on the other hand that you're not going to support a Bill that reinforces what you're saying. He goes on to say that he'd like to take this opportunity to thank us for supporting their policies. I'm paraphrasing as I go along.

He says: I'd like to just reaffirm that this government is against the use of loan guarantees and indemnities as a means to encourage economic development in the province of Alberta. Whoop-de-do. Absolutely great. But you know what, Mr. Speaker? That's exactly what this Bill says. The very first

section says quite clearly that we will amend the Department of Economic Development and Trade Act "by repealing

section 9," which is quite specific with respect to loan guarantees, providing guarantees and indemnities to corporations. The second

section of this Bill is "the Department of Technology, Research and Telecommunications Act is amended by repealing

section 10" of that Act, again specifically geared towards providing loan guarantees to businesses. "The Department of Tourism, Parks and Recreation . . . by repealing [again]

section 9," which is quite specific: providing loans and loan guarantees to businesses. Nowhere in the Bill does it mention anything in that we want to repeal loans or loan guarantees to students. Why draw the students into this thing? I mean, I can't imagine why anybody would want to do that when we're not talking about that at all. We're just saying that you've lost $2 billion so far. Two billion dollars is what the Financial Review Commission – this is a report put out and commissioned by the government themselves on January 21, 1993.

It says quite clearly that the high degree of risk is illustrated by the fact that the government has written off or provided for $2,100 million in loans and [loan] guarantees since 1985. Now, that's all we're after here, Mr. Speaker. Nothing to do with what the Member for Calgary-Varsity was saying. 3:20 He goes on on page 2136 of Hansard. He says: Mr. Speaker, Bill 213 is an unnecessary piece of legislation that need not be passed. It accomplishes little, and as I mentioned earlier in my remarks, perhaps the Bill should have dealt with the consolidation of all loan guarantee and [indemnities] under one Act.

All of these departments have now been amalgamated under the department of economic development, tourism, and trade. We're trying to deal with it in that context alone. We're not trying to get the Education department or advanced education involved at this point in time. This is quite clear. The Member for Edmonton-Ellerslie has said that the loan guarantees have cost this province over $2 billion. That is only to date, Mr. Speaker. We don't know how much more we're going to be faced with.

I mean, the Financial Review Commission has identified in outstanding loans and guarantees and investments $12.2 billion as of March 31, 1992. So when we're talking about the write-downs or the losses of $2 billion, hey, it's not over yet. It could go a lot higher, and I think it very well may. Something which would seem insignificant compared to the $2 billion is the riverboat guarantee, the guarantee through the Treasury Branches for this riverboat of about $700,000 or a million dollars. I don't know exactly how much it is. It looks like we're going to eat on that one too, Mr. Speaker.

That's all we're saying: just put an end to it. Nobody on this side of the House can say, "Well, that was then and this is now," because we did the riverboat not long ago. We did the guarantee for PW A. I'm not saying that it was good or bad, but I'm saying that we did

2194 Alberta Hansard May 25, 1994 it. We did the guarantee for the cookie factory. We may have been pushed into that situation. MR. PASZKOWSKI: What's wrong with it? That created jobs, you know. MR. CHADI: We may have been pushed into that situation; nonetheless we were there. We were there, and we did provide those loan guarantees. The minister of agriculture is going out now and just harping away defending it saying: we created jobs; we created jobs. Well, your own policy, Mr. Minister, says that you're not going to do that anymore, so now you're talking out of the other side of your mouth.

Y ou can't do that, you know. Y ou've got to talk straightforward. Y ou can't be talking out of both sides. MR. PASZKOWSKI: Y ou're a real asset. MR. CHADI: Mr. Speaker, the Minister of Agriculture, Food and Rural Development I believe has something to say, and if he has something to say, please stand up and say it. MR. SPEAKER: Is the hon. minister rising on a point of order? MR. PASZKOWSKI: He asked me to speak on his behalf, Mr. Speaker, and I'm pleased and honoured to do so. MR. SPEAKER: Well, I don't think the hon. member has that power. MR. CHADI: Mr.

Speaker, he made a very insulting comment, and he doesn't have the guts to stand up and say it again. Speaker's Ruling Parliamentary Language MR. SPEAKER: Order. [interjections] Order. Order. The hon. Member for Edmonton-Roper will have to find another description of this, because the word that he has used has long been held to be unparliamentary in this Assembly. MR. CHADI: Well, he doesn't have the gumption to say it, Mr. Speaker. Thank you. Debate Continued MR. CHADI: Mr. Speaker, all we want is a level playing field created in the province.

A level playing field: that's something that probably none of you would understand. Maybe there are a few of you in the bunch that would understand but certainly not all. A level playing field that would ensure that all companies are treated equally, that nobody gets an unfair advantage b ecause of government funds going in to guarantee an operation: what's wrong with that? How can anybody argue against that? For members to stand up and support the status quo is unbelievable.

I'm going to certainly be watching to see how this vote comes about because, you know, in a related kind of a way we have put up $200 million with Vencap. We put up that money in the year 1983. To date we have r eceived very little on our investment. How are those government funds, those taxpayers' funds being utilized? Well, I'll tell you, Mr. Speaker. They're being utilized to compete against other taxpayers' ventures. A simple example would have been when Vencap got involved in the restaurant business. Gee, there were a couple of restaurants in the Edmon- ton area.

I tell you, on 1 16th Street – I would hate to have had a restaurant in that area, knowing full well that taxpayers' dollars were out there competing against me. Any of those restaurateurs, how would they have felt? That's all we're saying: create a level playing field here. Quit the laughing and the gibberish and all the rhetoric. Come on; get down to business, and let's straighten this affair out. I know we can, because we've got a Bill before us in Bill 213 that allows that. It wasn't so long ago that we repealed other sections and entire Acts, Mr. Speaker. I remember doing Bill 14.

The minister of agriculture would remember that I'm sure. We repealed things like the Threshers' Lien Act. We repealed the Dairy Industry Act. We repealed the Seed Grain Purchase Act. Fourteen Acts we repealed. So it's not unusual in this day and age and the way that we're performing, and I think government is moving right along in a very quick fashion. This is a timely piece of legisla- tion, and I would encourage everybody to support this Bill. Thank you. MR. SPEAKER: The hon. minister without portfolio. MRS. MIROSH: Thank you, Mr. Speaker.

I rise to not support this Bill only because I don't think it's gone far e nough. As a matter of fact, all of the loan guarantees statutes could probably be amalgamated under the Financial Administration Act. There are a lot of changes that must be made, but this Bill does not go far enough. So I believe that it s hould be reviewed, as we have moved along in Alberta Opportunity Company and made some significant changes. The Member for Calgary-North West has alluded to the loan guarantee program with the Alberta Opportu- nity Company.

These guarantees are only to chartered banks and the Alberta Treasury Branch, and they enable small businesses. Small businesses are the backbone of Alberta's job creation and wealth. In order for some of these businesses to continue, the loan guarantees give them operating credit to meet their banks, where their banks are not prepared to give them any more funding. For that we do take fixed assets. Mr. Speaker, as a matter of fact, in the last five years several thousand jobs have been created as a result of that, and the loss to taxpayers has been minimal.

It's been 90 percent successful, and now we feel that the areas where we have failed badly we've corrected, such as the venture and seed investment activities. It has been eliminated. This division was commenced seven years ago and was designed to invest in young high-tech companies. At the time it seemed like a good idea, but because of the significant losses we have wound that down, have made some changes.

So I think a statute like this has to address those changes of today, and by doing that, with the amalgamation of the departments that has already been alluded to and with the ongoing changes, we should put this under one piece of legislation only. I think it's important again for the Assembly to realize that the mission of the Alberta Opportunity Company is to provide financial assistance and guidance for Alberta businesses in small communities. Certainly they're not there to compete against private sectors who do not get the loans.

They're only given to those particular businesses who need it and there's no other business like that in that community. Mr. Speaker, you have that in your own constituency, I know. So the priority is given to the Alberta-owned businesses who are labour intensive. In your own constituency it has been successful. I've been watching. The Alberta opportunity fund prohibits the provision of assistance to businesses engaged in basic agriculture or housing.

May 25, 1994 Alberta Hansard 2195 3:30 The mandate was created in 1972 to address the wide shortfall between financing available to small and medium business from commercial lenders, and that problem still exists today. Commer- cial lenders now work as a partner with the Alberta Opportunity Company to help these businesses survive, because even today after all of these years these large banks will not give these businesses any loans.

They have a list of successful rates as a result of the Alberta Opportunity Company helping these people through, putting forward a business plan, and then when they get on their feet, the chartered banks have taken over. They have thanked us for this. It's created business for the banks as well as we've done this. These are loan guarantees that have been successful. Probably 6,500 loans have been given over the last five years. Mr.

Speaker, there are instances where we have made changes and corrected them, but there are also areas where we have to look at the province as a whole, look into the small communities, and work with small businesses to enable them to grow. Our target is still to create jobs. Job creation is done by private sector to facilitate new jobs, securing of existing jobs through the provision of finance again to small businesses to obtain business financing in the private sector. I want to emphasize the private sector again.

Private sector creates wealth and creates jobs, not the government, so the government is just there to facilitate. Mr. Speaker, I know that there are a number of speakers, but I wanted to clarify the changes that AOC has made with regards to loan guarantees and the consulting services that they have, the corporate marketing. They help businesses to be creative and innovative. I believe that the Alberta Opportunity Company with their three-year plan is targeting exactly our philosophy in Seizing Opportunity in Alberta. Thank you. MR. SPEAKER: Is the Assembly ready for the question? The hon.

Member for Lethbridge-East. DR. NICOL: Thank you, Mr. Speaker. I'd just like to make a couple of points on Bill 213 that deals with the loan guarantee statutes of the government. If we look back through the process, through economic literature, through professional discussions, I think it's becoming very clear now that very few of the profes- sionals in the area of business promotion agree that loan guaran- tees are a good mechanism. There are other mechanisms that work much more effectively in making sure that viable businesses get started in an economy.

We hear so much about creating the Alberta advantage, and we want to be sure that it's done cor- rectly. That means we have to deal with it from the perspective of the kind of promotion programs for business that are long lasting, that are equitable, and that can bring about the kind of development that we want for Alberta. The idea of a loan guarantee in itself raises a lot of questions about the viability of the company.

The commercial financial sector has to be the best judge of whether or not a proposal for a business reflects any degree of viability within the industry that the proposed business is trying to establish itself in. If we look at a situation where governments provide an opportunity for loan guarantees, what we see is that this commercial financial sector says: "Gee, why take the risk?

We've got a marginal business proposal that we probably would have financed, but let's get the government guarantee put in place just in case." What this does is distorts the market both in terms of the financial operation of the business, in terms of the financial market itself in terms of supply and demand, in terms of the expected rates of return, in terms of the discounts that the banking institutions can use to deal with the viability of loans. So what we end up then with is really a major distortion in the total market position.

Now, in situations where we've used loan guarantees to maintain the existence of current businesses in the industry, let's face it, Mr. Speaker, those kinds of operations are at best marginal anyway. Otherwise, they wouldn't be in financial trouble to start with. What we need to do is allow for a change in the structure of the business, a change in the structure of the industry that will make it competitive. We've seen situations where businesses that have been supported by government loan guarantees or government loans continue to distort the sector. I think Gainers has got to be a good example of that.

The existence of a government-supported, government-financed business distorts the industry. It prevents the kind of growth that is possible in the industry. What you end up with then is inequity in the ability of firms that are trying to make it on their own financing in the industry. So what you deal with, especially when you're dealing with big businesses, is a very direct interruption of the equity that's necessary to make industries competitive and to provide an incentive for other businesses that are operating on their own financing to expand within the sector.

So basically, then, we don't want to deal with it in terms of supporting big business. If we look at the kind of support that we need to deal with in terms of small business, most of the entry constraints on small business are associated with criteria that aren't necessarily financial.

If we want to get in and try and promote the develop- ment of small business in Alberta, create our Alberta advantage, create the diversity that we need to have – these are, you know, the kinds of terms that we hear constantly about the future and the direction that we should be taking in Alberta – what we've got to do is look at options for providing the infrastructure that's necessary for small business to operate. The big business incubator programs were very effective in getting some small businesses started; they created distortions in others. So these kind of have to be looked at as well.

What we end up then with is basically making sure that businesses have the infrastructure that's necessary to be competi- tive. For most small businesses this has to deal with information access, market promotion, market development, market identifica- tion, and that doesn't need a loan guarantee. That doesn't need the kind of financial commitment that distorts the market and distorts opportunity. What we can do is deal with these kinds of situations for small businesses through support services, the kind of information dissemination opportunities that have been devel- oped.

The problem also arises when we start dealing with loan guarantees coming up in the market in that we get distortions not only in the financial sector but also in the capital sector where we have to start dealing with the impact that these kinds of loan guarantees will have on the opportunities for the capital asset market within an industry. Even though this is not included in here, I can give a good example: the way the Alberta Ag Development Corporation impacted on the price of land in Alberta when they were giving out loans on a large scale. These kinds of things have to be kept under control.

Point of Order Questioning a Member DR. WEST: Mr. Speaker. MR. SPEAKER: The hon. Minister of Municipal Affairs rising on a point of order.

2196 Alberta Hansard May 25, 1994 DR. WEST: Would the hon. member entertain a question in debate under Beauchesne 492? DR. NICOL: Do I have to look up 492? Y es, I'll entertain a question. DR. WEST: Would you? DR. NICOL: Sure I will. DR. WEST: Knowing some of the limitations in the discussion that you put on loan guarantees and benefits, could you tell us, because you're the agricultural critic, where you stand on the loan guarantees called the Feeders Associations of Alberta? DR. NICOL: Mr.

Speaker, that's well outside the bounds of the current discussions on loan guarantees, but I've made my position very plain on that. This is something that needs to be reviewed. It needs to be dealt with in terms of co-operative discussions with the Feeders Associations, and they need to be put in a position where over time they are, in an agriculture term, weaned off of the program. This has been made very plain to the Feeders Associations in our discussion. The main issue is that when you have to change programs, do it with compassion. Give them the time to make an adjustment.

I think this is the kind of opportu- nity that they'd like to see as well. 3:40 Debate Continued DR. NICOL: In continuing my discussion on Bill 213, Mr. Speaker, a couple of last points that I just wanted to bring up deal with the idea that if we put in place loan guarantees, what we're doing is inviting retaliatory action by other jurisdictions. We are constantly talking about the idea that we want to reduce interprovincial trade barriers. We support the idea of looking at a global economy.

If we're going to put in pl ace within our political jurisdiction programs which influence business decisions, we're not participating properly or ethically in the concepts of open trade and free trade that we're trying to promote. When we distort the market, distort the incentives, we end up then getting into competitive bidding positions for the establishment of new industry.

If we put a financial incentive for a business to come to Alberta when that business wouldn't have come here on its own incentive, under its own market-driven decision process, what we've got is a situation where that business has made a choice to locate in Alberta when it didn't have the economic environment to make it viable here. Now, the only way we can continue to support that business is to continue to put public money into it.

If we want to deal on an international market, if we want to deal on a Canadian market with our businesses being competitive on that basis, we have to make sure that they have a competitive situation and that they can stand on their own when they establish here. We want our labour force to have long-term jobs.

We want to have a commitment that will provide stability to them, and we've got to provide that by allowing our businesses to be stable and not constantly dealing with the ideas of, "Gee, if I don't get public money, if that public money gets cut off, how can I deal with the competitive position in the world environment?" We can't, Mr. Speaker, and we've got to deal with it from equity, from openness up front, and the best way to deal with that is no loans and no loan guarantees from the public treasury.

We've got to look at it from basically that the Alberta advantage has got to be built on our resource base, on our people, on our natural resources, and let industry develop it competitively. We've also got a problem that Bill 213 addresses very ade- quately. On numerous occasions when the government ministers have been challenged in terms of why did they give out a loan to this business or a loan to that business or a loan guarantee through this bank or that bank, the comeb ack was: well, gee, that's the mandate of this program, to give out those loans, to give out that support to business. Well, Mr.

Speaker, this Bill will eliminate the mandate for those loans to take place, and the ministers won't feel obligated then to give out the loans to make effective use of the dollars allocated to those programs within the government. I'd just like to in closing comment a little bit on some of the comments of the minister without portfolio. She talked about the AOC and its 90 percent success rate. If it's so successful, then we don't need it because the businesses that are applying for money through it would have viable proposals to put to the commercial financial sector.

Why do they need to deal with a government-supported, a government-backed financial institution if these businesses are so successful? The idea that the AOC is providing extra-risk opportunity capital isn't verified if they're getting the same kind of payback and loan commitments that the commercial sector is getting. Believe me, a 10 percent default rate is quite attractive, so I'm sure the commercial banks would like to see that in many of their financial transactions.

The minister also mentioned that the commercial banking sector was very supportive of these kinds of programs; they were very happy to see them put in place. Well, Mr. Speaker, I would suggest that, yes, that's true. When they can get a government through these programs to put the general revenue funds up as the major risk-taker in terms of their transactions, I suggest that, yes, the commercial banks would be very happy to see these kinds of programs and they would support the government getting involved in them.

Bill 213 effectively would take and eliminate from the programs in terms of business development the options for those programs to be used in loan guarantees and loans, and I would urge all members of the Legislature to support it. MR. SPEAKER: The hon. Member for Olds-Didsbury. MR. BRASSARD: Thank you, Mr. Speaker. It's a pleasure to join in the debate of Bill 213. I, too, do not support the use of loans or loan guarantees as a means of encouraging economic development in the province of Alberta, primarily because it does not conform with this current government's philosophy.

Having said that, however, I will not be supporting this Bill that is presently before this House. My colleagues have already raised many of the points which I feel make this Bill inappropriate. When Premier Klein assumed the leadership of our party prior to the last election, he had the insight to establish an independent commission to review the province's financial position and report directly to Albertans. This Financial Review Commission released its report in March of last year.

Within that report the commission made several recommendations regarding the use of loans and loan guarantees, the most important of which was that government no longer use loans or loan guarantees as a means to carry out public policy. Mr. Speaker, we have accepted that recommendation wit hout hesitation. This party did not promise the world to Albertans during the campaign leading up to last year's provincial election. What we did promise, however, was that we would balance the budget by

May 25, 1994 Alberta Hansard 2197 the fiscal year 1996-97 without raising taxes and without reducing the quality of core services this government provides to Alberta. We are keeping that promise. Another important promise that we made was that our government would follow the recommendations of this Financial Review Commission that I spoke of. We would de-emphasize the use of loans and loan guarantees as instruments of that economic development. Since June 15, when this govern- ment received the overwhelming s upport of Albertans, we have not issued a loan or loan guarantee.

The only exception I would mention was to honour an outstanding commitment to Canadian Airlines that was made prior to taking over. Mr. Speaker, Bill 213 proposes to remove sections relating to loan guarantees and indemnities from three Acts under control of the Department of Economic Development and Tourism. As I have just mentioned, the government has already stated that it will no longer use loan guarantees and indemnities as a means to encourage economic development in this province.

The problem that I have with Bill 213 is that it really accom- plishes nothing in respect to th is government's ability to issue those loans and loan guarantees. In fact, Mr. Speaker, there are numerous other provisions that allow this government to enter into these types of financial transactions. Even with the removal of the three sections referred to in Bill 213, the government could still enter into loans and loan guarantees through the Financial Administration Act. The narrow-minded approach of Bill 213 is its biggest downfall.

If the opposition believes that the loan guarantee issue begins and ends with Economic Development and Tourism, they are sadly mistaken. Again, there are 20-plus other legislative provisions dealing with loans and loan guarantees. The Municipal Government Act, the community development Act, and the Department of Agriculture Act are just a few of the Acts which authorize the use of loans and loan guarantees. This government has acknowledged the mistakes that were made by previous governments. At the time, government and a majority of Albertans believed it was the right thing to do to make such guarantees.

Such megaprojects as Syncrude and Al-Pac and the Lloydminster biprovincial upgrader were brought to life because the government of Alberta felt there was a role for them to play in developing Alberta's economy. While other invest- ments and guarantees have cost Albertans a great deal of money, there can be no mistake that there are certain benefits that still exist in this province. 3:50 I know of one instance right in my own constituency, Mr. Speaker, where a sawmill was becoming very redundant, was up for sale, and no one could buy it b ecause the banks weren't interested.

A buyer did come along who was very familiar with the industry, needed a $6 million loan guarantee, and received it from this government. They went on to revamp and, as a matter of fact, rebuild the mill completely. They now have equipment valued in excess of $25 million. Their sales last year alone were in excess of $45 million. They are now building another sawmill of equal size and are going to be producing LVL lumber, which is laminated veneer lumber. They currently, in their original mill, are employing 367 people in an industry that hardly could employ 37 before it was taken over.

So there are some success stories. Incidentally, they never ever did call on the loan guarantee, although they paid the percentage. I forget exactly what it was for the term of the guarantee, but they never ever did use it. Mr. Speaker, I mentioned Canadian Airlines. I'd just like to note that they offer perhaps the most recent example we have had of our involvement in industry. Albertans were unsure of whether or not the government should be involved; there's no question about that.

The oppos ition would have pr eferred that this government not provide a guarantee and that thousands of Albertans would lose their jobs. The government of the day made a very difficult decision to support Canadian Airlines and the many Alberta-based employees who fought for the survival of this uniquely western Canadian airline. Because of that guarantee, Canadian Airlines has since been able to close its deal with American and ensure its continued participation in the Canadian airline industry. This has guaranteed the continued employment of thousands of Albertans.

The opposition also came out against this government's involvement in Gainers. Since the very moment this government took over control of Gainers, the opposition called on this government to close it down and throw hundreds of Edmontonians out of work. Again, Mr. Speaker, the government had some very difficult decisions to make. Ultimately, the company was returned to the private sector and will continue to be a major employer in the city of Edmonton and to provide market access to northern Alberta producers.

There are numerous other instances where loans and loan guarantees are still utilized by this government: the student loan program, loan and loan guarantee programs offered through the Alberta Opportunity Company and the Agriculture Financial Services Corporation. Would the opposition have the government shut down these programs? Where exactly does the opposition stand on loan guarantees per se? The most recent example of a contradiction in their policy is their opposition to the restructuring of the student loan program.

Instead of the government interfering in the marketplace by guaranteeing student loans directly, private financial institutions will assume responsib ility for 90 percent of all student loans handed out in the province of Alberta. Even though this restruc- turing will save the taxpayers of Al

Document details

Collection	Alberta — Debates (Hansard)
Citation	19940525
Type	hansard
Volume / chapter	L23 S2 19940525 1330 01 han.pdf
Language	en
Format	json
Source	PROVINCIAL
Identifier	7ff691251551842ff691e47d427f32395e3a7447

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