1987 Legislative Session: 1st Session, 34th Parliament

HANSARD

The following electronic version is for informational

purposes only.

The printed version remains the official version.

Official Report of

DEBATES OF THE LEGISLATIVE ASSEMBLY

(Hansard)

WEDNESDAY, JULY 15, 1987

Morning Sitting

[ Page 2537 ]

CONTENTS

Routine Proceedings

Presenting Reports –– 2537

Ministerial Statement

Dismissal of Mr. Ron Butlin. Hon. Mr. Reid

–– 2537

Ms. Edwards

Committee of Supply: Ministry of

Transportation and Highways estimates.

(Hon. Mr. Michael)

On vote 61: minister's office –– 2 537

Mr. Miller

Mr. Sihota

Mr. Vant

Mr. Ree

Mr. R. Fraser

Mr. Lovick

Royal assent to bills –– 2549

Committee of Supply: Ministry of

Transportation and Highways estimates.

(Hon. Mr. Michael)

On vote 61: minister's office –– 2549

Mr. Stupich

Mr. D'Arcy

Mr. Gabelmann

Ms. Smallwood

Mr. Serwa

Mr. Long

The House met at 10:05 a.m.

Prayers.

HON. MR. REID: Mr. Speaker, it gives me a

great deal of pleasure to introduce the administrator of the district

of Coquitlam, a former mayor and honorary Kinsman from the district of

Coquitlam, Mr. Jim Tonn.

Hon. S. Hagen presented the thirteenth annual report of the

Universities Council of British Columbia.

Ministerial Statement

DISMISSAL OF MR. RON BUTLIN

HON. MR. REID: I wish to make a ministerial

statement to clarify and set the record straight on the debate which

has taken place in the House relating to Ron Butlin, who served as

chairman of the B.C. Games. I first want to say that during these

discussions I did not intend to mislead, nor do I believe that I did

mislead, the House and its members. Clearly, however, misunderstanding

has arisen, and if I contributed unintentionally to that, I apologize.

It is in that context, in the interest of clearing up the situation,

that I make this statement.

In my comments and responses on the question of Mr. Butlin in

the House last Friday and yesterday, I tried to make the point that he

had not been fired, because he was in fact still working under contract

to my ministry. While Mr. Butlin had received a letter dated May 27

which would have terminated his contract with the government effective

May 29, that notice was rendered null and void by a new contract which

was mutually agreed to by Mr. Butlin and my ministry.

I believe, therefore, that my comments that he had not been

fired were valid in the context of the second contract and the fact

that Mr. Butlin was still in our employ. However, I might point out to

the House that a condition of the second contract was that neither

consenting party would make any public comment about its terms and

conditions. Mr. Butlin, for reasons of his own, has now seen fit to

violate that agreement. For my part, Mr. Speaker, I will not make any

comment on it or discuss its provisions, and I have requested legal

advice on the employment status of Mr. Butlin because of what appears

to me to be a violation of that agreement.

I hope that this statement ends any misunderstanding that may

have arisen. I repeat that my comments were made on the situation as I

saw it, without any intent to mislead the House or its members.

In closing, I want to assure the House that our B.C. Games

program remains as strong as ever, and the plans and preparations for

the Summer Games in Delta, to be staged in the municipality, are on

time and on schedule.

MS. EDWARDS: Mr. Speaker, the minister is

suggesting that it's fair to say that because a contract employee, as

he was, is still on contract, he was not terminated. I believe that

that is not a reasonable answer to the question that was put to Mr.

Reid in the House. The question that was put to Mr. Reid was....

MR. SPEAKER: Hon. member, would you please

refer to the member as the Minister of Tourism.

MS. EDWARDS: I'm sorry. The Minister of

Tourism was asked whether Mr. Butlin had been terminated; he was asked

whether he had been fired. The minister said that that was not the

case. In fact it has now become clear that the whole series of events

between the ministry and Mr. Butlin was begun and initiated with a

termination notice that came from the ministry. We believe that it's

one of the foundations of our system, and it's expected, that when a

question is asked in the House, the minister should answer with the

whole truth. Therefore I have continued to ask the minister to answer

that question fairly. When the evidence came up, we still didn't get a

straight answer, and I would suggest that that is still the essence of

the issue.

MR. MILLER: I rise on a point of order, Mr.

Speaker. This subject has been the focus of considerable debate, and

indeed is a serious matter for the House. I think it would only be

appropriate that, if the minister is planning to make a ministerial

statement regarding a matter of such importance, some notice be given

to this side of the House, so that the appropriate people can be here

to make an appropriate response. It's obvious that the member has had

to dash into the House in order to be here, and I think that's a valid

SOME HON. MEMBERS: Order!

Orders of the Day

HON. MR. STRACHAN: Committee of Supply, Mr.

Speaker.

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

ESTIMATES: MINISTRY OF

TRANSPORTATION AND HIGHWAYS

(continued)

On vote 61: minister's office, $235, 299.

MR. MILLER: Mr. Chairman, when we left off

last night we were discussing some aspects of vehicle safety. A quick

question before I get into the whole question of commercial vehicle

safety is with regard to the aggregate used for sanding on our

highways. I don't know if this problem is peculiar to the north or not

but, when we drive the northern highways in the winter, we find that

we're not using sand anymore; we're using gravel. We're using some

fair-sized gravel. If you ever get stuck — as I did two years ago —

driving Highway 16 in December, it's a pretty horrendous experience.

It's like driving through a minefield, particularly when you've got

transport trucks going by you or ahead of you. A short jaunt in the

north is about 500 miles from Prince Rupert to Prince George.

I see the Minister of Forests (Hon. Mr. Parker) smiling. He

understands the problems of the north, and I'm sure the member for

South Peace River (Mr. Weisgerber) understands the problems of the

north, although they haven't spoken about them too much. But there

really is a need, I think, to improve the quality of the aggregate used

in sanding. That short trip can cost a motorist his headlights,

probably his

[ Page 2538 ]

windshield, and probably a fair amount of paint on the front

of the car.

Could the minister just deal with that question before we get

into the whole question of commercial vehicles?

HON. MR. MICHAEL: Mr. Chairman, the member

is certainly correct about the image — and I would have to say, more

than the image, the fact — that this question of sand on highways is

certainly a problem in the province of British Columbia. It seems to be

more of a problem in the north than it is in other areas of the

province, and I suppose it is a result of the ice conditions and snow.

We do have a fair number of other sections of the province, but I get a

tremendous number of complaints from the northern regions about the

size of our so-called sand.

The ministry's standard is to crush the material to a maximum

size of five-eighths of an inch. The reason for that particular size is

that if you put plain sand on a snowpack or ice, the sand would perhaps

not give any traction and would seep into the ice or snow, resulting in

very poor traction and thus not doing the job. I question the

five-eighths size. I'm now looking at the cost of experimentally

reducing that five-eighths to a half or three-eighths.

I can tell you that through ICBC they have also researched the

cost of windshield replacement in the last fiscal year. It's an

astonishing amount of money. I was thunderstruck when I heard the

amount. It's in excess of $20 million a year that we're spending

replacing windshields.

MR. D'ARCY: That's just ICBC?

HON. MR. MICHAEL: That's just ICBC. That

does not include the deductible. What I am doing now is looking at what

it would cost to reduce the size from five-eighths down to, say,

three-eighths. If you could do that for $5 million and reduce the $20

million down to $15 million, you've got a break-even situation, and

anything below that would be a saving. So there's something there to

look at. I can also say that the $20 million does not include the

headlights or the paint jobs as a result of this problem. It is truly a

problem and is really brought to light when I travel the north country,

because it is not unusual to get into a car in the northern part of the

province and see the windshield with three, four, five or six very

large pit marks. The average person up there tells me they don't even

bother replacing a windshield until the season is over, because it's

that bad.

Yes, it's a problem, and we're looking at it and will continue

to do so.

[10:15]

MR. MILLER: Perhaps, Mr. Minister, you

might look into the feasibility of using all those broken windshields

by grinding them up and using that as your aggregate.

Returning to the question of commercial vehicle safety, there

have been numerous expressions of concern. Spot-checks conducted in

British Columbia reveal a fairly high level of defects in those

commercial vehicles. The minister has talked about it and has put out

releases on the National Safety Code and how that will improve the

situation. I wonder if the minister could briefly advise how that work

is progressing. When are we going to see the implementation of that

code? I realize it involves the federal government and other provinces.

Perhaps you could give us a very brief status report in terms of the

development and implementation of that code.

HON. MR. MICHAEL: Mr. Chairman, the

inspections that we have.... Our program in British Columbia is working. We

are finding that it's working positively. The number of unsafe vehicles

during our inspections, while still high, is showing signs of

improvement. We are working very closely with the private sector, the

owners of the fleets. Many of them now have very good facilities to

bring their vehicles up to standard; they are regularly inspected. The

culprits, perhaps, are the very, very small operators, by and large.

Yes, we are working with the federal government on the

National Safety Code. While the date for its implementation is January

1, 1988, I'm not sure whether all of the provinces are going to be able

to meet that deadline, but we do have strong support from the federal

government, and indeed funding from the federal government to assist us

in setting up the program. While we in B.C. have had a fairly high

standard, come January 1, 1988, interprovincial trucking between all

the provinces in the Dominion of Canada will have to live up to the

same standards. But we are not nervous about meeting those standards,

because B.C. has always had much more stringent standards than our

neighbours both to the east and to the south.

MR. MILLER: Continuing with that, my

concern is that we really have developed something on paper that we

haven't taken the corresponding steps for, in terms of monitoring and

all the other factors. In fact, I note that in March a spokesman for

the Canadian Trucking Association, although he welcomed the news that

this would be developed, also said that it's very unlikely that it

would be in operation by January 1. I'm wondering if we are doing

enough.

I note that they also express some concern about the impact of

deregulation in terms of the whole question of safety, in that if we

look at some of the American experience.... And I don't think that

there's an exact parallel to the American experience, but certainly you

should look at other jurisdictions and see what the impact of that has

been, where we see a number of new people coming into the industry and

the potential existing for a lowering of standards as the business gets

more cutthroat. There's some feeling on the other side that that's a

preferable situation and that that kind of competition is actually good

for consumers and the industry. Nonetheless, there are some detrimental

side effects, and that's one of them. As people come into the industry

who perhaps don't have the experience or who don't have the kind of

capital to back themselves up — they're fairly marginal operations —

you see the squeeze on in terms of maintenance and of the number of

hours that drivers are spending behind the wheel.

I wonder if the minister would agree that it would be

preferable to have this code completely worked out. I know we talked

yesterday about legislative change in British Columbia, but would the

minister agree that it would be preferable to have this code worked out

and in place — in other words, an effective code — before we really

move into that whole area of deregulation, so the code could cover

those possible detrimental side effects?

HON. MR. MICHAEL: Mr. Chairman, we do not

have any direct control over what the federal government is doing, and

my understanding, if my memory is correct, is that the

[ Page 2539 ]

proposal is to have both the dereg and the National Safety

Code click in at the same time, January 1, 1988. As I say, whether they

make that date or not remains to be seen, but we in British Columbia at

this very moment are putting the machinery in gear to add additional

staff and make provisions for a stepped-up program of commercial

vehicle inspections, and we will indeed have additional staff at weigh

scales and areas such as that to look after the commercial sector of

transportation.

MR. MILLER: Mr. Speaker, changing subjects

again, I want to get back to something we talked about yesterday which

I want to explore in a little more detail, and that's the construction

of the Coquihalla Highway thus far.

I asked the minister a question the other day about a contract

that was let for some $5.5 million. It came in over budget and the

minister talked in his very brief response about the seasonal nature of

the work. I'd like to explore that just a little bit more.

The contract in question was let to Kerkhoff Construction

Group Ltd. of Chilliwack — project B-2882 — the Great Bear snowshed on

the Coquihalla Highway. First of all, can the minister advise when that

project was commenced and when it was completed? Would he confirm the

value of the original contract that I've cited, and would he also

advise the committee what the final cost paid by the ministry was with

respect to that contract?

HON. MR. MICHAEL: Mr. Chairman, that's a

very good question and a very good issue. The original bid price was

$5.5 million. The total payment to the contractor was $10.5 million.

Some of the reasoning is the fact that the tender was let with the

understanding that the work would commence on a certain date.

Unfortunately the contractor involved was not able to get into the area

for some two months after the date that he was told he could enter the

area.

He had worked and bid on the project on the basis of

completion by November 1985, and we all know what the Coquihalla is

like in that particular region of the project — a tremendous, heavy

snowload factor. As a result of the two-month delay in his getting

into the project, of course, he wasn't able to complete the project

until a long time after that, having had to work through the very heavy

winter months. There was an extremely heavy snowload factor, and it

was very expensive to keep the project going.

Along with that — again no blame on the contractor — he had

difficulty as a result of our efforts and not having adequate access.

He had access to only part of the site, again resulting in delays.

Also, the contractor had poor rock, which was not anticipated. Much

more money than expected had to be spent to set these anchors in place

as a result of the poor rock. Along with that, as in many other major

contracts that have been let, there were other extra work items that

our staff had laid on the contractor which resulted in this figure.

It's perhaps one of the worst overruns I've experienced since being the

minister, looking over my shoulder at projects in recent times. That

certainly cost the taxpayers a lot of money.

However, I have to say that the projects of Coquihalla I were

indeed tendered at a point in time when the economy was extremely soft

in the province of British Columbia. There was an awful lot of

equipment sitting idle, and the province did get tremendously good

bargains by and large, as far as the projects are concerned. But that

particular one did have a very heavy overrun.

MR. MILLER: During that discourse, the

minister didn't give me any firm dates, which is what I asked for: when

the project commenced and when it was completed. Has the minister done

any investigation? Has his ministry conducted any investigation with

regard to the project and where the overruns occurred specifically?

First of all, could the minister advise of the dates: when the project

was actually started; when the project was completed; and whether any

investigations were done with regard to the project?

HON. MR. MICHAEL: Regarding the dates, Mr.

Chairman, he was originally scheduled to start in June; he did not

start until August. That's what I said earlier; there was a two-month

delay. The original completion was scheduled for November 1985; in fact

the project was not complete until February 1986.

On the question of managing and investigating the costs, Mr.

Chairman, I can assure the member that every single bill that enters

the Ministry of Highways for payment is perused and investigated and

examined. If there is any doubt, it goes to a more senior official to

make a judgment decision. We certainly had a look at all invoices, as

we do throughout the entire system, prior to authorizing payment.

MR. MILLER: Mr. Chairman, my information is

that the contract was signed on July 18, so it appears there was maybe

a one-month delay. Would the minister advise whether any extraordinary

efforts were made by his ministry in terms of this particular contract?

For example, was an engineer by the name of Rokeby hired by the

Ministry of Highways to sort through the invoices on this particular

project?

HON. MR. MICHAEL: The person mentioned by

the member was the resident engineer on the job. While it's true the

contractor was not able to start construction until July 17, he did not

have access to the whole site until August. So that's the explanation

for that.

I repeat: the overruns were extensive, but our ministry is

satisfied that the invoices submitted were justified, and payment was

authorized.

[10:30]

MR. SIHOTA: First of all, let me say that

it is my information that the contract was dated July 18; it may well

have been executed a day or two before that.

The question is with respect to the role of Mr. Rokeby. I'm

not too sure what the usual job of the engineer is on these projects.

Can the minister confirm to this House that Mr. Rokeby was given

specific instructions to review all of the invoices with a greater

level of scrutiny than is usually the case?

HON. MR. MICHAEL: Mr. Chairman, I can say

that the answer is no, but in answering no, I can assure the member

that the ministry scrutinizes and examines all bills very closely

before payment.

MR. MILLER: Mr. Chairman, with regard to

the scrutiny and the investigation by the ministry, was any concern

expressed at any time about other reasons for cost overruns — for

example, double billing?

HON. MR. MICHAEL: Mr. Chairman, I can say

that from the ministry's point of view, knowing that there were a

[ Page 2540 ]

lot of problems out there as a result of the things I stated

earlier, we have no reason to believe that there are any unusual

submissions or any cause for any extra concern over any other project

that we were doing at the time.

MR. SIHOTA: A question, then, for the

minister. He says that he has no reason for concern. The question is:

at the time, did the ministry have any concerns about either false

invoices or double billing on the project, and did it scrutinize the

invoices that were submitted with a view to determining whether or not

there was indeed double billing or false invoices submitted?

HON. MR. MICHAEL: The answer, Mr. Chairman,

is no.

MR. SIHOTA: Is the minister saying that his

ministry had no concerns at all at any time about double billing or

false invoices with respect to this project?

HON. MR. MICHAEL: Well, the answer, as

stated earlier, is no. We examine all invoices very closely before

payment.

MR. SIHOTA: Again to the minister: were any

allegations of double invoicing or false invoicing brought to the

attention of ministry officials with respect to this project?

HON. MR. MICHAEL: Mr. Chairman, as to

whether there were any allegations brought to us for investigation

within this ministry, as far as the ministry is concerned, the answer

is no.

MR. SIHOTA: Is the minister then saying

that he's aware of allegations brought forward to other ministries?

Interjections.

MR. SIHOTA: Mr. Chairman, a question

through you, again to the minister: could the minister then elaborate

on the nature of those allegations and perhaps inform the House of

which ministry those allegations were directed to?

HON. MR. MICHAEL: Mr. Chairman, I would

suggest to the member that I am not prepared to speak on behalf of

another minister. If the member has questions he would like to ask of

another minister, he should either do that during that minister's

estimates or during question period.

MR. MILLER: I wonder, then, Mr. Minister,

since you're not prepared to talk about what the allegations were and

who they were made to, but you have conceded that you are aware of them....

Going back in terms of your previous responses, if you were aware of

allegations, why, in the course of your investigation or checking into

a project that really had doubled in size...? It's pretty unusual for a

project to.... It's not unusual to go over budget, but it's pretty unusual

to double — to go from $5.5 million to $10 million. If you were aware

of some allegations of double billing or things that weren't right, why

did you not investigate that matter yourself internally within the

ministry?

HON. MR. MICHAEL: I did not at any time say

that I was aware of allegations regarding double billing. I was aware

of allegations. I was not aware of the specifics of the allegations. I

repeat, Mr. Chairman, perhaps that question could be taken up in detail

with the minister involved.

MR. SIHOTA: Mr. Chairman, the minister says

that he wasn't aware of allegations of double billing, but he was aware

of allegations. Could he inform the House as to what allegations he was

aware of?

HON. MR. MICHAEL: Mr. Chairman, I am not

aware of the specifics of the allegations. I am aware that there indeed

were allegations, and I have all of the respect in the world for the

ministry that is involved in the investigation of those allegations. I

have no reason to have had concern in my ministry, because there were

never any specific results indicating any negative action, any wrongful

action, brought to my attention that would cause me to take action to

impose any holdbacks.

MR. SIHOTA: It's very interesting. I take

it the minister is confirming that the matter is being investigated by

the Attorney-General ministry. If I'm wrong in that, I would ask the

minister to correct me.

Once the minister became aware of allegations — so far he

hasn't said what those allegations were — why did the minister choose

not to investigate it himself? It seems to me somewhat strange. If

there are allegations that came to the attention of the ministry with

respect to a project that had doubled in cost, it should have been a

matter of more than just passing interest to the minister. It seems to

me that the minister surely must have investigated. Accordingly, I am

wondering what steps he took to investigate once he became aware of

these allegations.

HON. MR. MICHAEL: I repeat that the

question of the details of the allegation should properly be addressed

to the minister who was involved with that particular subject.

As far as my role is concerned, I am completely satisfied with

the competence of my staff and with the control provisions that we have

within our ministry. I am assured by my staff, and was assured by my

staff, that there was no reason for us to get involved in investigating

allegations. That is not the role of this ministry. The role of this

ministry is one of managing Highways, and in managing the Ministry of

Highways we set up planning, we do our organization and we set up

control procedures, which are the elements of management. In our

control procedures, we have a system of checking and double-checking to

make sure that invoices as submitted indeed have proper authorization

from competent people who have been appointed to fill that role and

authorize payment when justified. I am at this point, and have been

since being the minister, satisfied that we have adequate control

procedures in place within the ministry.

Anyone having any allegations can take them to the

Attorney-General, and he or the RCMP will do the investigations. But it

is the not the role of this ministry.

MR. SIHOTA: I want to thank the minister

for confirming that the Attorney-General ministry was involved in the

investigation of this matter. Can the minister unequivocally say to

this House that there was no double invoicing or false invoices

submitted to the ministry with respect to this project?

[ Page 2541 ]

HON. MR. MICHAEL: The answer to the

question is no. Just to correct the member, I would say on the floor of

the House that if someone has allegations, he should take them to the

Attorney-General. As to whether or not the Attorney-General was

involved in allegations on this issue, I would ask the member to

perhaps ask the Attorney-General during question period or his

estimates to clarify that aspect, because I am today not aware of

whether or not the Attorney-General was directly involved. I do know

that there were allegations.

MR. VANT: Seeing that the Cariboo

constituency has more public roads than any other constituency in the

entire province, I feel entitled to make a few remarks. Indeed, I am

standing largely because of some of the remarks made by the hon. member

for Prince Rupert (Mr. Miller) just last night. He seemed to imply that

our hon. minister's immediate predecessor was somehow unfair, that he

paved all the roads in the Cariboo and that the roads in Prince Rupert

riding were somehow ignored. I want to assure this House and the

minister that there are still over 5,000 kilometres of gravel and dirt

road in the Cariboo constituency,

whereas in Prince Rupert, by the

latest figures I have, there are a measly 39 kilometres of gravel road.

Every other public road in the riding of Prince Rupert is paved.

I get the sense that the hon. minister is very fair, as his

predecessor was, in looking after the roads throughout the province. My

only disappointment this current season is the decision to shelve....

I'm talking about the main Highway 97. Because there is just a handful

of socialists, like to Prince George North and Prince Rupert, that like

to go up our main Highway 97.... I am a little disappointed that the

one project from mile 86 to mile 93 on Highway 97 has been shelved for

this season. I am aware, of course, that it is very difficult for the

minister, seeing that the budget is down about 12 percent, and he's had

to make some very difficult decisions. I am disappointed that the main

north-south highway — that little project there — has been shelved.

That's my only disappointment.

HON. MR. MICHAEL: Mr. Member, I appreciate

receiving suggestions during estimates from members such as yourself.

Speaking for the record, that member has been working very hard with me

since his election in fighting for additional improvements to that

great constituency in the Cariboo. He has repeatedly pointed out to me

that on a percentage basis — in kilometres — it has more unpaved roads

than any other constituency in the province. I have a lot of sympathy

for him because the constituency of Shuswap-Revelstoke is very close

behind him.

MR. MILLER: I didn't follow all the remarks

by the second member for Cariboo (Mr. Vant), but I did hear the name of

the previous Minister of Highways mentioned. I would like to assure

that member and his partner in that great constituency which has

received the benefit of so much highways work, that I have every

respect and regard for that member.

Returning to the subject at hand, the minister said that he

can't confirm that there were no false invoices filed with respect to

this project. Would the minister then confirm that there were false

invoices filed?

HON. MR. MICHAEL: Mr. Chairman, I have no

knowledge of that.

MR. MILLER: The minister denies any

responsibility. Surely when his ministry is paying out double the

amount originally agreed to, it must be a matter of some concern within

the ministry — if not the minister himself. Could the minister advise

if there are current investigations going on and who would be

conducting those investigations?

HON. MR. MICHAEL: There are no current

investigations going on to my knowledge. I can also say that on this

particular project in our control procedures, which involved the

control division and our resident engineers, there were a number of

claims reduced or disallowed. Again, that is not unusual in major

projects of this size. There is continually an evolution of areas of

dispute between contractors and staff; that's why we have a very tight

control procedure on payment of invoices. We review them, analyze them

and make judgment calls.

Yes, there were a number of claims reduced and disallowed on

this project. But I repeat: this is not at all unusual. There is a

continual dialogue and argument taking place between staff involved in

the payment of invoices and the major contractors. I can tell the

member that with the system we have in place, these disputes are

settled and resolved. It's very rarely that it is ever brought to my

attention by a contractor that there is bitterness or anger over a

submitted claim. We do have the odd one, but by and large, I think the

system is working quite well within the ministry.

[10:45]

MR. MILLER: I've been involved in one

project of some significant size; in fact, the value is about $5

million. As the chairman of the organization building that project, I

was concerned every step of the way about cost overruns. Could the

minister give us some idea of the kinds of invoices he has briefly

described that were disallowed?

HON. MR. MICHAEL: To do something like that

would require a great deal of time and notice. Had the member given me

that notice, I would certainly have attempted to have that with me

today. But to get into that type of detail on precise examples or

samples, I'm not prepared to draw on those on short notice.

I can tell you that it's a continuing process within the

ministry of what is fair and equitable, and what is right or wrong. We

have experienced staff in place — highly qualified engineers and

accountants — to make those decisions. I'm sure that we're no different

than any other ministry or Crown corporation or private sector

corporation in that process. We analyze and decide based on evidence

and invoices and advice of our on-site engineers and control personnel.

MR. SIHOTA: Is it not true that this matter

was under investigation by both the RCMP and the Attorney-General's

department?

HON. MR. MICHAEL: Mr. Chairman, my only

knowledge is that it was under investigation by the RCMP. There were

allegations taken to the RCMP; that's my only knowledge. To my

knowledge, the Attorney-General was not involved. It's unfortunate the

Attorney-General (Hon. B.R. Smith) is not here today to answer the

question himself I repeat that it would be better put to him during

question period or estimates. My knowledge is limited to the RCMP.

[ Page 2542 ]

I'd have to leave the question of the Attorney-General to be

answered by the Attorney-General.

MR. MILLER: With regard to that

investigation then, would the minister advise whether he or his

departmental officials were contacted and supplied information to the

RCMP with respect to that contract?

HON. MR. MICHAEL: The answer is no.

MR. SIHOTA: That's amazing, Mr. Chairman,

incredibly amazing. A question to the minister: is it not true, Mr.

Minister, that when the contract exceeded $10 million, ministry

officials asked the contractor Kerkhoff to stop submitting any further

invoices?

HON. MR. MICHAEL: Yes, Mr. Chairman, that

is true.

MR. SIHOTA: Will the minister confirm that

the reason for that was that the ministry had concerns about

overbilling, false invoices and double invoicing?

HON. MR. MICHAEL: My information is that we

had no reason to suspect any double billing or wrongdoing. It was just

a matter of the total cost of the project.

MR. SIHOTA: A question to the minister

again. Could the minister then explain to the House why at that point

the ministry officials asked Mr. Kerkhoff's firm to stop submitting

invoices?

HON. MR. MICHAEL: Well, Mr. Chairman, we do

that on any project where there are major overruns.

MR. SIHOTA: Again to the minister. Was the

project complete at that time?

MR. CHAIRMAN: Would you repeat the

question, please, hon. member.

MR. SIHCfrA: Was the project complete at

that time?

HON. MR. MICHAEL: Yes.

MR. SIHOTA: But I'm sure the minister

would also agree with me — and he can correct me if I'm wrong — that

the invoices that were coming in after that point had been surpassed

were still in relation to work that had been performed on the project.

Is that not true?

HON. MR. MICHAEL: The answer is yes.

MR. SIHOTA: It seems to me somewhat

peculiar that the ministry would not accept as policy invoices after a

certain quantum of money has been expended on the project, unless of

course it wants to involve itself in litigation. Indeed, if the

invoices are legitimate, then they must be accepted and be paid for

under the contractual obligations between the ministry and the

contractor. If they are not legitimate, then of course the ministry has

every right to say that they won't accept them. I can only assume that

that third branch that I just laid out right now is the one that

applied. Am I correct in that: that the ministry chose, after the

figures surpassed $10 million or $10.5 million, not to accept any

further invoices because it was concerned about the legitimacy of

invoices?

HON. MR. MICHAEL: Basically, Mr. Chairman,

the answer to the question is no, but the reason for rejecting invoices

at the point in time where they were rejected was, plainly and simply,

that more information was required.

MR. SIHOTA: Would the minister tell the

House, then, whether or not further information was supplied by the

parties from whom it was requested?

HON. MR. MICHAEL: The answer is yes. Upon

full analysis of the ministry by the staff and close analysis of the

invoices submitted, those approved by the ministry were paid, and those

that weren't were not paid.

MR. SIHOTA: With respect to the invoices

that were not paid, would the minister agree that one of the reasons

they were not paid was with respect to a concern the ministry had about

the legitimacy of those invoices? Is that one reason, Mr. Minister?

HON. MR. MICHAEL: Mr. Chairman, it's very

difficult to interpret the word "legitimacy." There may be some

connotation that there is a wrongful or illegal action by someone, and

certainly we never felt that way. We analyze bills as we do in every

contract. We analyze the invoices, the reports of the project

engineers, the resident engineers, people within the ministry who are

involved in control procedures and make judgment calls every day of

every year when bills are paid. If our staff feel that an invoice does

not represent actual services rendered, then we question the invoice.

If follow-up documentation that satisfies the ministry staff is not

received, we have a procedure whereby the contractor can talk to

someone at a very high level within the ministry to argue his or her

case.

To give exact specifics of what was and wasn't paid is very

difficult, but we in our ministry are satisfied at this time that in

the total project, while very high, there was sufficient reasoning and

full knowledge that his contract was indeed extended into the very

heavy winter months. I'm not sure whether or not the minister for

Esquimalt-Port Renfrew is aware of the type of snowfall in the

Coquihalla, but I'm told it's not unusual to have 30 or 35 feet of snow

on that mountain — working under very extreme conditions. As I say, the

contract was not finished until February, with heavy winter snow months

in December, January and February in that region. There were very

expensive overruns — very unfortunate.

But we got the project open by the target date set down by the

government. It was certainly of great benefit to the people of the

province of British Columbia to have that project open for Expo. My

information is, Mr. Chairman, that without the Coquihalla having been

open for Expo year, the Fraser Canyon would have been in an intolerable

condition due to tremendously heavy traffic, very frustrated drivers,

and the very high likelihood of serious accidents.

I'm not sure whether the members opposite are aware of the

tremendous benefits of the Coquihalla Highway and its relationship to

safety — accident prevention, the number of lives saved by traveling

that highway, particularly during the very busy Expo year. Up until the

last two or three weeks, there had been only one fatality on that

highway since it

[ Page 2543 ]

opened. I understand there was a recent one in which an

individual hit an animal on the road. He wasn't wearing his seatbelt,

and we've had our second fatality.

But there has been an extremely good safety record on the

highway. It is well engineered, recognized by people throughout the

length and breadth of British Columbia and, indeed, the Dominion of

Canada. We're even getting letters from residents in the United States,

writing the minister complimenting him on what a tremendous highway the

Coquihalla is. I'm sure all members opposite would join the members on

this side of the House in looking forward with great anticipation to

the opening of Coquihalla 2 on September 4. We invite all the members

to come to that great opening in Merritt and Kamloops to see the

opening of the Coquihalla all the way from Hope to the great city of

Kamloops. We're also looking forward to the further extension of the

Coquihalla 3 into the Peachland area — hopefully by the fall of 1990.

MR. SIHOTA: I want to thank the minister

for that commercial break, but I think we should get back to the point.

I also want to thank him for referring to me as "minister." That will

only be two or three years from now, at the next election, I hope, if

the Leader of the Opposition has faith in my abilities.

I want to get back to the issue at hand. It seems to me, Mr.

Chairman, if I may think out loud a bit here, that there were several

projects on the Coquihalla Highway, because we know the government

wanted to fast-track them for Expo. I'm sure many of them met with

seasonal difficulties and heavy snowfall. I think we're all well aware

of the problems in that area with respect to snowfall. But all of the

contracts that took place during that time period were affected by the

same seasonal factors, yet this contract sticks out as being one that

doubled in cost to the taxpayers of this province. I'm not too sure,

because I haven't checked, but I don't think that there are too many

others over that same time period that doubled. Accordingly, I would

venture to say that it's unlikely that the sole explanation for the

doubling can simply be seasonal factors.

[11:00]

I also would say, as I think out loud here, Mr. Chairman, that

it is difficult to reconcile, on the one hand, the minister's

assurances that everything is above-board with, on the other hand, the

capping at $10 million or $10.5 million combined with the RCMP

investigation. I think it may lend more credence to the argument that

indeed there were concerns with respect to overbilling and false

invoicing.

With respect to those invoices., there were indeed, as the

minister indicated in his opening comments when quizzed by my good

friend the member for Prince Rupert (Mr. Miller).... When quizzed, the

minister made a comment about extras, and I'm sure that some of that

overrun is predicated on extras. I ask the minister this question: was

the minister, during the course of his ministry's review of this whole

issue, ever made aware of the existence of any agreements whereby

Kerkhoff would submit invoices for extras under an understanding that

if those extras were paid by the ministry, 40 percent of the payment

would go to Kerkhoff Construction and 60 percent would go to the

contractor submitting the invoice? Was the minister ever aware of any

agreements to that effect?

HON. MR. MICHAEL: Mr. Chairman, the answer

from our ministry is clearly no. I would say that if that member wishes

to make allegations such as that and make statements along the lines of

whether everything was above-board or not, he should probably make them

outside the House.

MR. SIHOTA: Was the minister ever made

aware of an agreement, then, with a firm called Specialized Coatings

and Sealants with respect to this 60-40 agreement?

HON. MR. MICHAEL: The answer, Mr. Chairman,

is no, I've never heard of the firm in question.

MR. SIHOTA: Would the minister please tell

the House whether or not that type of an arrangement would be

acceptable to the ministry?

HON. MR. MICHAEL: Mr. Chairman, I don't

think I have to answer that question.

MR. SIHOTA: Under the terms of the

agreement between the ministry and the main contractor — one of the

Kerkhoff companies — could the minister tell the House what the

agreement was with respect to wages to be paid to employees? Was there

a fair wage provision? Were any wage rates stipulated in any of the

contracts? Or were there any agreements that touched upon the rates

payable to employees working on the project? Was that covered at all in

the contract?

HON. MR. MICHAEL: Mr. Chairman, I think the

member is well aware that we in the Ministry of Highways, and indeed in

other ministries in the province, do not get involved in setting rates

other than the rates as set out by legislation — as set out in minimum

wages and requirements such as that; WCB requirements, CPP requirements

and UIC requirements, which are both federal. But as far as instructing

contractors on what wages they pay, the answer is clearly no.

MR. SIHOTA: The minister earlier on in the

course of our discussion on this issue indicated that he was aware of

some allegations that were made with respect to work performed on this

project. Were there any allegations that came to the attention of the

minister along the line that although invoices were submitted stating

that workers were paid — for example, $25 an hour — that indeed they

were actually paid a sum close to half of that?

HON. MR. MICHAEL: Mr. Chairman, my

information was limited to a former deputy of mine informing me that

there had been allegations made to the RCMP. My information now is that

they were not sufficient enough to warrant further action by the RCMP. I

never asked for specific detailed information on those allegations. I

knew it was being handled by the RCMP, and I have all the faith in the

world in their investigations and their inspectors and their

procedures. The rest, Mr. Chairman, I would have to say is hearsay,

from my perspective. I've heard quite a few rumblings of what has

happened and what hasn't happened, not only on this particular

contractor, but I've heard stories in the corridors and on the street

on some of the things that allegedly go on.

We have a procedure in the province of British Columbia called

due process. If there are allegations and charges to be

[ Page 2544 ]

made, they should go through the proper channels. As Minister

of Highways, I am satisfied that the control procedures with the system

we have in place are adequate and sufficient. The other ministries will

do their job, and I'm sure they will inform me of any wrongdoings and

things that I should involve myself in. To this point in time I have

not had that advice from other ministries.

MR. SIHOTA: Mr. Chairman, once again

returning to the point, during the course of rumblings — if the

minister wants to put it that way, or allegations — was this issue of

wages billed versus wages paid brought to the attention of the minister?

HON. MR. MICHAEL: Mr. Chairman, not

officially. I would welcome a signed document, an affidavit, from some

one who would like to lay it on the table and put it to the Minister of

Transportation and Highways. I would welcome such information. To this

point in time I have not received anything other than what I would have

to refer to as either rumblings or hearsay, and I'm sorry, Mr. Member,

but the Minister of Transportation and Highways cannot take action on

such hearsay and rumblings. Put something on the table, let me have a

look at a document that's got some meat in it, and we'll have a look at

it. I

MR. SIHOTA: It strikes me, Mr. Minister,

that there are several issues here, one of which is the whole issue of

whether this ministry will move on these types of allegations to

determine whether or not they are indeed true, instead of simply

relying and hoping that other branches of government will do just that.

With respect to these allegations of wages billed versus wages

paid, is the minister aware of any investigations on that issue by the

employment standards branch?

HON. MR. MICHAEL: Mr. Chairman, the answer

is no. Surely if the problem is as severe as the member opposite

states, that someone somewhere, whether it be a subcontractor or an

employee, would have come to the minister.... And my door is always

open; I have never refused an appointment.... Certainly to my knowledge

I have not refused an appointment as long as I've been the minister. My

door is always open, and I've talked to people from all walks of life —

individual citizens who have concerns. I've answered my mail and my

telephone calls to a T, and if someone has a claim or a grievance or

cause for concern, please, Mr. Member, have that individual come

forward and talk to me. I may not be able to directly involve myself as

the Minister of Transportation and Highways in resolving that person's

dispute or allegation, but I can certainly see that proper action is

taken if he has a cause for claim.

MR. MILLER: Mr. Minister, I don't know

exactly when the ministry became aware and presumably the contractor

became aware that there were difficulties with the contract, that it

wouldn't be able to be done according to the tendered price or the bid

price, and I don't know what point that is, but.... Perhaps the

minister would advise: was it $6 million, was it $7 million, was it $8

million? When did you start to have those discussions in terms of that

contract going over the bid price? Secondly, what arrangements were

made with respect to those moneys over and above the bid price? You

mentioned originally that there were extras that were required — there

were more anchors, poor rock, the access was a question, the snow was a

question. There seemed to be a variety of factors involved in going

over. What was the nature of the agreement between the ministry and the

contractor once you'd had those discussions regarding this contract?

HON. MR. MICHAEL: As far as the question as

to what level the light comes on, I have to leave that to my senior

staff, my deputy and assistant deputies and people working in the

control division. I wasn't the minister at the time, but I certainly

was as fully aware, as every member in this House in government was

fully aware, that the government had set down a target date for the

opening of Coquihalla 1. That target date had to be met and it had to

be met by early May in order to satisfy the tremendous flow that was

predicted as a result of Expo. Everything was in high gear.

I am sure that the minister of the day and the senior staff,

as well as the Premier of the day, were well aware that there would be

problems when you set target dates that are difficult to meet. Our

engineers and staff were convinced that the target date could be met,

but we knew that it was a difficult highway, that there would be

problems, that there would be overruns. I'm not sure whether the member

opposite is aware, Mr. Chairman, but every single major contract that

we have in the province has a degree of overrun. It happens in every

case. There is always the unexpected. There are predictions set out by

the engineers as to the volumes of rock, the volumes of dirt, the

volumes of blasting, and a lot of plans are made and things are

anticipated. When you get into big projects and big road-building

projects, invariably there is the unforeseen. So we do have overruns.

In the case of this particular contractor, yes, it was very

heavy and, from the ministry's point of view, certainly does not

reflect well when you look at a near double. But in rationalizing the

reasons and going over the background and looking at the extremely

heavy snowfall that the contractor was faced with, and all of the other

factors that were built in....

As far as the extra work items, I can't rattle off what all

the extras were. But I can tell you that there are extras in every

major contract throughout the province of British Columbia. If you

would like me to supply you with some examples of the extras, please

make your request and I will see that you'll get sufficient

documentation from our staff.

MR. MILLER: I'm taking that comment to mean

that all documents relating to this particular issue are available for

members of this House and in fact should be public documents.

I asked specifically what the nature of the arrangement was

between the ministry and the contractor with respect to overruns at the

time. At some time somebody must have triggered an alarm bell within

the ministry. I mean, it's highly unusual for a contract to double in

cost. At what point — whether it was at $6 million, $7 million, $8

million, $9 million — did somebody say: "We've got a problem here"? Or

did we just shovel the money out?

I asked you about the relationship, but you must have sat down

and said: "Look, we've got a serious problem; how are we going to

handle it from here on in?" At what point was that, and what was the

arrangement? Was it a cost-plus arrangement? Did the ministry simply

agree to pay the invoices of the contractor with a blank cheque?

"Finish the project and we'll pay the bills." Was that the arrangement?

[ Page 2545 ]

HON. MR. MICHAEL: The member remarked

earlier that this was the only one to his knowledge where there was a

heavy overrun, and I can tell the member that this is not the only one.

There were a couple of others that were pretty heavy as well, and it's

a simple matter. We had anticipated a startup at a certain date. That

date was not able to be delivered to the contractor, and once the

project got started — and it was a late start — the minister was well

aware that there was a problem, and that problem was defined in one

word, and that was "weather." It was within the complete knowledge of

the minister that we were going to have a problem as a result of the

extremely heavy snow in the area.

We're not happy with the cost. We knew it had to be done. The

orders were to go, we went, and we delivered. I don't think we have any

regrets. The project was open on time. It did the job for the people in

the province of British Columbia, and it is certainly resulting in a

lot of economic activity and people enjoying that short route from the

mainland to the interior of the province of British Columbia.

I might say that it's not just British Columbians who are

enjoying the Coquihalla Highway and improving the economic well-being

of the province; it's other western Canadian provinces as well — the

truckers and the passengers and the attractions that the Coquihalla is

bringing in commercial activity and in tourism.

[11:15]

MR. MILLER: I'm trying to get through these

estimates with a fair bit of speed, with some fairly short and rapid

questions, and I keep getting these election-style speeches from the

minister in response to very specific questions. That's really

unfortunate. I don't want to take the time of the House, because I know

there are other members here who want to ask questions. The member who

just piped up from his seat wants to ask about what the government's

going to do about Highway 3. But I want to find out about a contract

that doubled in cost. It's an important issue, and this is the forum to

determine those things.

The minister just said that somebody was giving him orders to

go. Was it to go at any cost? Is that the way we build highways? Is

that the way we spend the taxpayers' money wisely — go at any cost? Who

was giving the orders? Would the minister simply answer yes or no. Was

the relationship, in terms of the completion of this project — whenever

the ministry finally woke up and decided that there was a problem at

hand — a cost-plus arrangement?

HON. MR. MICHAEL: It was a cost-plus

arrangement on the extras.

MR. MILLER: Which is standard policy, and

quite frankly, in my experience, not a very good policy, because it

allows the contractor pretty well free rein. There's where you can lose

a lot of money. If the member for Yale-Lillooet (Mr. Rabbitt) thinks

tossing $5 million of the public's money away is a trifling matter,

then he can explain that to the public and his constituents.

To wrap up this particular issue, I don't think we've really

got the full story, but given the time, some of the other questions

that are obvious.... The minister finally conceded that this wasn't the

only project that had a considerable cost overrun. I'll be interested

in pursuing that with the minister to find out just where the money

went, what the problems were, why we were experiencing these overruns

and why there wasn't a little better control.

Getting back to the tendering of the original project, when I

look at some of the other projects that were tendered in relation to

the construction of that and other highways, and knowing that the

ministry itself does a cost analysis.... In other words, the ministry,

when they put that tender out, have a fair idea in their own mind what

a realistic price for the contract should be. I have two questions.

Number one, what was that ministry estimate, in terms of this

project? Secondly, looking at the various tenders that came in on the

project, I find that there's a considerable range. The lowest tender is

the $5 million from Kerkhoff, and we go all the way up to almost $9

million from the highest bidder, Tonto Construction. In that group of

about eight contractors who bid on the project, we do have a

considerable range. Contractors with a fair amount of experience — for

example, Peter Kiewit — were saying it would cost $8 million.

Number one, what was the ministry's estimate? Number two,

bearing in mind that nobody who is tendering is obliged to accept the

lowest bid.... In fact, they're obligated to look at that bid, in terms

of the project, to make a determination of whether it's realistic or

whether they're simply letting a tender to the lowest bidder and

leaving themselves open for that whole ball of wax that we've now

gotten into, where we've allowed that contract to double in size. Would

it have been wiser, in hindsight, to consider some of the other tenders

submitted by experienced contractors in this province and say that it

was realistic to let the contract at that particular price to that

particular contractor?

HON. MR. MICHAEL: I suppose the only way I

can answer that is to reflect on a statement I once heard that the only

thing you get looking over your shoulder is a kink in your neck.

Perhaps something could have been better by a different decision being

made back in the summer of 1985, but I'm not in a position to comment

or to make any judgment calls on whether or not it in fact would have

happened any differently. Regardless of what contractor was awarded the

tender, the conditions would have been the same. He would have been

faced with the exact same delay in getting started, the inability to

have access to the whole site as set out in the tendering document, and

he would have incurred the extra costs.

As far as the other matters are concerned, I think I covered

them in answers to questions asked previously by the member. Yes, I

suppose you could say the orders came from headquarters. The plan was

set out. The government made a decision: Coquihalla. I was going to

open by mid-May of 1986. Yes, while certain jobs in certain parts of

that project had significant overruns, the fact is that the project was

built during times when a lot of major equipment and major contractors

were sitting idle in the province. We got what we considered extremely

good bidding on these projects to build that highway for the people of

British Columbia, and as I stated earlier, it's being enjoyed by people

both nationally and internationally.

MR. MILLER: I'm amazed. Mr. Chairman, that

the minister can give such fine-sounding statements in regard to such a

matter. In terms of the operation of the ministry, it must be an

all-time low. The minister perhaps — and maybe his predecessor — simply

didn't have any power in this regard,

[ Page 2546 ]

because the minister's own statement is that he was taking

orders from somewhere. You can't convince me, and I don't think you can

convince anybody who has any understanding of contractors, that when

the word was put out that anything goes at any cost — and it's obvious

that was the word — the contractors must have been rubbing their hands

in glee. "The word is out. Let's start throwing the bills into this

ministry." Because they dealt with this issue of highway construction

in a political way as opposed to a sound, business-practice way, in

terms of building a highway and getting the best costs.

Given the constraints of time and other people's desire to

canvass issues, I won't proceed any farther at this point with respect

to this and other possible overruns on that

section of the Coquihalla.

My colleague from Esquimalt-Port Renfrew may have a couple of questions

in terms of finalizing the issue, and then I want to deal very briefly

with one other issue before other MLAs have an opportunity.

MR. REE: As the minister indicated

yesterday, ferry traffic from Horseshoe Bay to Departure Bay in Nanaimo

is up about 12 percent. Might I suggest that there's a limiting factor

for the increased growth? I'm not talking about Horseshoe Bay, but the

access to the North Shore. As you're well aware, we have some

difficulties with backups in the Cassiar corridor and on the Second

Narrows Bridge. We have difficulties with the Lions Gate Bridge. Not

only should the centre span be widened — and I know there have been

plans in the past to do so, but we've never proceeded because, I guess,

Expo held that off — but there's also very great restriction on the

Stanley Park causeway, which is down to bedrock. As you are well aware,

ditches have been lowered on the sides to take the drainage, and

something should be done fairly imminently with respect to the causeway.

Mr. Minister, could you advise what the plans of your ministry

are with respect to the Cassiar corridor, the Lions Gate Bridge and the

Stanley Park causeway? Because they are in imminent need of attention.

HON. MR. MICHAEL: The Cassiar connector and

the Lions Gate Bridge are certainly being strained to the limit, and I

can also say they are big-ticket items. We're looking at a lot of

dollars on both those projects — I mean really big dollars.

Regarding the Cassiar, I have had conversations with the mayor

and aldermen in charge of transportation for the city of Vancouver, and

I would expect that, if the House has adjourned by early next week, I

will be making a trip to Vancouver to meet with the mayor, aldermen and

senior staff, along with my senior staff, to review the problems over

there and to analyze alternatives and plans set out by planners,

engineers and staff, to see what the alternatives are and to have a

look at the bottom line — the cost — and to see when and if a target

date cannot be agreed upon.

Regarding Lions Gate, I'm pleased to report one thing to you.

We do have assurance and a plan that the Lions Gate Bridge can be

four-laned. That information was brought to me very recently. It's

something that has been worked on for some time, but we do now have a

plan in place to four-lane the Lions Gate Bridge. But once again, it's

dollars. It can be done without too much inconvenience to the traveling

public, but it's a big-dollar item. I believe the figure is $90 million.

It can be done, and in conjunction with that, naturally, there

would have to be something done to the Stanley Park causeway. There

would have to be some widening, and I'm sure we're going to have some

problems with people in widening that area. I've been through it. I've

had a close look at it personally, in taking trips over to the North

Shore. While not being a major, costly project, it would certainly

cause some environmental concerns. Whether they are slight or major

depends how you would interpret that.

These are very good points — areas on the drawing boards of

the ministry. I think I made reference last night to the tremendous

number of demands for capital throughout the province of British

Columbia. These are just two further examples of major capital

requirements of Highways, ferries and B.C. Rail.

You mentioned Horseshoe Bay. I can tell you, Mr. Member, that

if the growth carries on as it has for the last three years in the

Horseshoe Bay area, we are going to be into extreme difficulties for

B.C. Ferries to facilitate and handle the large volumes using that dock

facility. There are going to have to be some alternatives sought to

relieve the congestion, because we're running into difficulties there

already, and it's going to be that much greater as the next two or

three years unfold.

As I said, total capital requirements.... Without any effort,

without any searching, we got together in just the last two or three

weeks with our senior staff, and we came out with $4.7 billion worth of

needs that we can see on the short-term horizon throughout the length

and breadth of British Columbia.

MR. REE: I'll just make one point if I may,

Mr. Chairman. Both of those corridors, the Stanley Park causeway and

the Cassiar, are probably the most heavily traveled in the province. In

other words, more people are impacted by those corridors than anywhere

else in British Columbia — the traffic patterns. I would trust that

that would be a certain consideration in arriving at a conclusion as to

where those dollars that are spent each year are going to be spent.

[11:30]

MR. MILLER: As I stated, I think there are

a number of issues that need to be canvassed. Just briefly running

through some of them, and concluding with one that I hope to get an

answer from the minister on, I congratulate the minister on his efforts

to reach an agreement with the federal government for more of the

capital dollars for the cost-sharing on Highway 16. I do have a

concern, however, in terms of the kinds of delays that are being

experienced before those contracts are let. We are now seeing that the

first contract in the Tyee-Khyex

section probably won't be started until

some time in August, and clearly we could have been away ahead in terms

of that contract and possibly others. I wonder what kinds of delays are

taking place in the ministry with respect to the letting of contracts

and the issuing of contracts.

Secondly, on the Vancouver Island Highway, there was a

commitment from the Premier prior to the election for $450 million over

an eight-year period. Certainly that's a major commitment, and we'll be

watching with interest to see that the work is progressing on that.

I note that in B.C. Rail, which falls under this ministry,

they have some concerns about the impact of deregulation and

competition between CNR and CPR. We'd hoped that there would be no

downgrading of revenues on B.C. Rail as a result of that kind of

federal legislative change, which this government is supporting.

[ Page 2547 ]

With regard to the ferries, certainly the feeling in the north

country has been that the federal subsidy of $14 million, $15 million

or $16 million that this government receives, which is based on a

highway mileage equivalent, has really not gone into the northern

operation as we would like to see it. Certainly I'll be continuing to

press for the winter operation of a Prince Rupert-Tsawwassen run, which

I think is quite feasible, in terms of linking in with the Alaska

system.

Finally, with respect to Highway 97 and the Hope-Princeton,

there is considerable concern in the lower Okanagan about the impact of

the completion of the Coquihalla — phase 3, or the connector, as it's

called — in terms of possible negative impacts in that

section of

British Columbia. There's been a pretty high response in terms of the

need to upgrade Highway 3 and Highway 97. Perhaps the member for Yale

Lillooet (Mr. Rabbitt) will want to talk about that himself.

I note that there have been a fair number of accidents on

Highway 3, and that sections of Highway 97 are identified as so-called

"hot spots" in terms of accidents. The member for Yale-Lillooet feels

that three sections of the highway should be tackled, that they are

unsafe. There are a number of expressions of concern from regional

districts and municipalities in the area.

Dealing particularly with Highway 3, I wonder if the minister

could outline what plans his ministry has to deal with this really

quite old, very winding highway, which is obviously dangerous in terms

of the kinds of accidents we're getting and obviously very essential if

we don't want to cut sections of this province off from good access,

good highway corridors that can be used not only for the transportation

of goods but for the movement of people, particularly to those

communities which rely on tourism for their economic benefit.

So I'll conclude on that note, listen to the minister's

response, and then my colleague from Nanaimo, who has responsibility

for B.C. Ferries, may wish to raise some issues with regard to that

section of the minister's portfolio.

MR. R. FRASER: A couple of remarks about

the suggestions made by the opposition on the Coquihalla. I wonder

whether they would have raised so much fuss if one of my unionized

contractors had gotten the job, but that remains to be seen. And there

was a sort of sly suggestion that a 60-40 split is unrealistic: it's

not unrealistic if the subcontractor and the general contractor agree.

The science of engineering is not a science exactly as one might

expect. It is not like a bean counter, where you put the beans on the

table and count them one by one, and they're all there. When you do

engineering work and heavy construction, you're doing a little bit of

estimating, a little bit of guessing; you don't really know for sure

where all that rock is or how much rock is there. The simple fact that

overruns exist from time to time is not unusual.

I would suggest to the opposition that if there are any pieces

of information that the minister should have, they should give them to

him. I would expect that the minister, receiving anything like that,

would investigate fully, as you would expect any minister of the Crown

to do.

I didn't really intend to talk about this. I want to talk a

little bit about safety and ask the minister if he has any statistics

on what percentage of accidents is caused by faulty equipment. If he

has that information, I'd like to hear it, because I've got more.

HON. MR. MICHAEL: Regarding faulty

equipment as the cause of accidents, a report given to me recently by

my motor vehicles branch clearly indicates that in 1986.... I've got

statistics covering 1982, '83, '84, '85, and '86, and there's not much

variance in those five years. In 1986, as an example, human action was

involved in 66 percent of accidents, and human condition in 15 percent.

If you add those two together, 81 percent of accidents in the province

had the human factor — driving without due care and attention, alcohol,

drugs, careless driving, excessive speed. Environmental conditions put

in 16 percent, adding up to some 97 percent involving human action,

environmental condition or human condition. Only 3 percent of accidents

can be directly related to vehicle condition. So the thrust of the

traffic safety committee's attention in the future must be in those

areas: stiffer penalties and perhaps dollar fines, as we're now getting

into for such things as driving without due care and attention,

excessive speed, careless driving, alcohol impairment; things along

those lines.

Regarding the member's remark about overruns and union or

non-union, I can assure you that this minister does not ever go looking

at or reviewing overruns as to whether or not the contractor is

unionized or non-unionized. However, now that the member has mentioned

the point, yes, Mr. Kerkhoff, the contractor, is non-union and had an

overrun of nearly double; but I can also tell the member that a

unionized contractor had a contract that turned out to be more than

double. So we don't go around looking at whether it's union or

non-union. The opposition chooses to examine one particular contractor,

but as I said earlier, there are a couple of others around where the

results are out of line. The minister looks at that and we make

judgment decisions. In this last example that I pointed out, it was

clearly the result of engineering within the ministry not being

completed.

Talking about engineering, Mr. Member for Prince Rupert, and

the question of the Tyee late call, yes, I would dearly love to be able

to put out all the major tenders early in the year — February, March,

April — and indeed I'm working toward that objective. I think that's

the way you get the best value for the dollar. In respect to the

question that you ask about the Tyee project, it's clearly a result of

not being able, engineering-wise, to have all the i's dotted and t's

crossed to put that project out earlier. It is out now, and yes, we

will be starting next month.

Regarding the Island Highway, the report is in the hands of

the Premier. Yes, there is a project underway right now; quite a few

more will be called prior to year-end. It's interesting that the member

mentioned the subsidies received from the federal government for our

B.C. Ferries. Yes, the figure is somewhere in the neighbourhood of $60

million. Perhaps the member opposite could do both sides of this House

a favour and ask your members back in Ottawa — we don't have any

members in the Social Credit Party in Ottawa, but you do have some.

Perhaps you could assist us; we could work in a spirit of cooperation.

You could be going back to your members in Ottawa and asking them to

please correct the inequities in subsidies to ferries.

In eastern Canada they are receiving in the neighbourhood of

$130 million a year in subsidies to the eastern ferries. We in British

Columbia have as many ships, every bit the size of the fleet of all

those in eastern Canada combined, and we are getting a paltry $60

million. Mr. Member, what are the members of your party doing in Ottawa

in pressuring

[ Page 2548 ]

the government to give a better break to the people in the

province of British Columbia?

Yes, Mr. Member, we are looking at Highway 97; it's the plan.

I won't give you an assurance, but it's certainly the ministry's plan

to see that Highway 97 north to south in the Okanagan — from Salmon Ann

to Penticton at least — is four-laned in time for the opening of

Coquihalla. 3 in the fall of 1990.

Highway 3 will be getting attention this year in the area of

paving. I am pleased to report that in the current fiscal year we have

budgeted $7 million for paving Highway 3. As far as turning Highway 3

into a major artery, I can tell the member that that is another very

big-ticket item somewhere out in the future, as far as the long-range

plans of the Ministry of Transportation and Highways are concerned .

MR. LOVICK: I am delighted to hear the

Minister of Transportation and Highways acknowledge what everybody in

this country has: namely, if you want anything done, make sure you get

the NDP to lobby for you.

However, I am not here to score points on the Minister of

Highways; that's too easy. Instead, what I want to do very briefly is

pose some questions about the B.C. Ferry Corporation — one of my critic

areas. I know there is a cast of thousands in this House wanting to

talk to the Minister of Highways about particular projects. First a few

questions about the Ferry Corporation.

To begin, let me offer some praise. The minister points with

justification to the operations and activities and efficiencies of the

B.C. Ferry Corporation. All things considered, I think the corporation

operates very well, and that is to their credit. Take note, you

advocates of privatization. The question that remains is whether there

is a lot more we could be doing. The first and most pressing question

that people have — those of us who depend on the ferry system on a

regular basis — is whether the transportation costs will continue to

rise. There is nothing mysterious about the question; indeed, it's

predictable. The point is that there have been increases for the past

eight years, with one exception only: Expo 86.

I grant everybody that the issue of rising costs is of primary

concern to the residents of the smaller islands. But it's also of

concern for people living on Vancouver Island and going back and forth

to the mainland. I want the minister to simply grapple with that

question and consider whether he is prepared to give us assurances that

that pattern of regularly increasing ferry rates is going to end, or

whether there will at least be some kind of rationale provided — a

longer-term rationale, rather than every year we have to talk about

increasing ferry rates.

[11:45]

The first question is whether the ministry and the corporation

acting under the minister's authority will consider developing some

kind of coherent policy regarding ferry transportation and pricing

policy, a statement of the criteria used to determine and a statement

of longer-term plans. At the moment, we seem to be responding to

immediate and imminent crises, rather than any kind of longer-term plan.

I hope that we can get some assurances that that will be

considered. I know that the residents of the Gulf Islands as well as

residents of Vancouver Island would like to see that kind of statement

coming from the Ferry Corporation — a statement governing the tariff.

That's my first question.

Mr. Minister, in the interests of conserving time I'm going to

give you a number of questions, if I can, and you may want to respond

to them all briefly now or perhaps give me more elaborate answers later.

The second question, a kind of subquestion to the first, is

whether the plan of the B.C. Ferry Corporation is to operate without

subsidy, to pay its own way. Or is it the case that what we're going to

talk about doing is rationalizing some kind of what we call the highway

equivalent formula? The point is made by a number of other people. For

example, I see the Victoria Chamber of Commerce has advocated that in

correspondence to the minister. In other words, will we get some

assurances that the ferry system is going to be recognized as an

essential part of the highway and transportation system in the

province, rather than something that seems to be subject to a kind of

double taxation? That is what we think we have now, quite frankly.

The second question I would pose to the minister is whether

there might be some consideration given to putting the operation of the

ferry system into a larger economic development strategy for the

province; more specifically, a development strategy with a regional

base or bases. For example, we hear complaints from Gulf Islands

residents saying that the ferry

schedule is not compatible with the bus

schedule. Understandably, then, they wonder whether there ought to be

some consultation between those two authorities, which I realize are

independent of one another. The question is whether we can talk about

pulling together transportation as just another component of a larger

economic development strategy. I'm talking about future policy, I

guess, Mr. Minister, but I would recommend that to the corporation.

The third question has to do with what the minister and I both

had some experience with recently, in February or March: the great cry

for more public involvement. The minister will recall vividly, I am

sure, what happened when he went to various islands and the refrain

that we heard from the residents: "You're doing this to us, Mr.

Minister, and we haven't been consulted." I'm wondering if we might

talk about setting up some more elaborate procedure that provides for

public involvement and consultation with those residents, especially on

the smaller islands, who are directly affected by pricing and

schedule

changes.

I would anticipate, by the way, that the minister may well say

in response to that: "Well, we already have some committees." I know

there are some committees in place, but I submit that they tend to be

token in their activities. For example, I understand that the members

of the committees who are asked to come over to Victoria to meet with

officials of the corporation don't even get their costs, their ferry

fare over to those meetings, repaid them. That seems to me not exactly

conducive to any ongoing consultative process.

The next question I would pose, perhaps more for future

reference — and I notice it was alluded to by my colleague from Prince

Rupert — is the improvements to northern services. I would simply

recommend to the minister's attention the correspondence he received

from the community of Prince Rupert concerning the cooperation and

doubling-up of ferry routes and ferry authorities with the Alaskan

authority. I am wondering if he can tell us now or later whether any

further study has been undertaken with regard to that proposal.

The final question I would pose — a larger one and for future

reference — has to do with an economic development strategy. The

contention has been presented that what we have done effectively in the

smaller island routes, specifically northern island routes — I'm

referring to places like

[ Page 2549 ]

Denman, Hornby.... The argument presented there from

individuals who have done a considerable amount of homework, Mr.

Minister — and I'm sure you're familiar with the submissions they have

made — is that in fact what the ferry tariff policy has done has been

to serve as a disincentive or as a discouragement to development.

Now when I read that brief, I too had some questions about

whether the kind of causal connection between price and use was indeed

that valid, or whether the demand, if you like, was that

price-responsive or price-elastic. The question, though, I want to pose

to the minister is whether he has indeed considered those kinds of

briefs, specifically the one that came from the Denman Island people,

who really did a good job of doing their homework and did a number of

interesting projections and analyses of past traffic patterns, and so

forth. The question I would pose is whether the ministry and the

corporation have indeed done any of their own studies to determine just

how responsive to price is traffic, if we can get that kind of

information.

I see that the government House Leader is asking us to end

this. Those are my questions for ferries, so I'll leave those for the

moment if I can. I would move then, if I might, Mr. Chairman, that the

committee rise, report progress, and ask leave to sit again.

Motion approved.

The House resumed; Mr. Speaker in the chair.

The committee, having reported progress, was granted leave to

sit again.

HON. MR. STRACHAN: Mr. Speaker, I am

advised that His Honour is in the precincts. Perhaps you could ring the

bells, sir, to summon members, and then His Honour will be visiting us

shortly.

His Honour the Lieutenant-Governor entered the chamber and

took his place in the chair.

CLERK-ASSISTANT:

Municipal Amendment Act (No. 2), 1987.

CLERK OF THE HOUSE: In Her Majesty's name,

His Honour the Lieutenant-Governor doth thank Her Majesty's loyal

subjects, accept their benevolence and assent to this bill.

His Honour the Lieutenant-Governor retired from the chamber.

HON. MR. STRACHAN: Mr. Speaker, Committee

of Supply.

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

ESTIMATES: MINISTRY OF

TRANSPORTATION AND HIGHWAYS

(continued)

On vote 61: minister's office: $235, 299.

MR. STUPICH: Mr. Chairman, I have a number

of short questions....

Interjections.

MR. CHAIRMAN: Hon. members, Committee of

Supply is being called to order. If you want to hold meetings, would

you please do so out in the hall.

MR. STUPICH: I've raised most of these

items in previous sessions — with a different minister, true — and I've

always had generally satisfactory answers, so I'll try again.

I've discussed with ministry staff previously — perhaps never

with this minister personally — the intersection of Takla Road with the

Island Highway; that's just north of Oyster Bay, north of Ladysmith.

It's a very bad situation there. It's almost blind, coming out of Takla

Road, and traffic going north on the Island Highway, wanting to turn

left on Takla Road, is a hazard. The answer would seem to be a left

turn slot for traffic going north along the Island Highway and wanting

to turn left onto Takla Road. A year ago the ministry said they would

look at this. Some improvements were done by removing some rock, which

improves the visibility a bit. A left-turn slot would certainly help

there, if the widening of the highway is going to be long delayed.

On previous occasions the Minister of Highways has assured me

that there would be some kind of pedestrian crossing of the Island

Highway from Transfer Beach to Ladysmith, which is on the other side of

the highway. I know an underpass was talked about, and I know that

they're not popular But on previous occasions the Minister of Highways

has recognized the need for a pedestrian crossing between this very

popular beach and the bulk of the population on the westerly side of

the highway. I hope that that's still in the plans.

I have discussed previously, again with ministry staff and the

minister.... I know the Diamond Bridge is one of their priorities, and

I'm not sure when they'll get to it. But there is a very serious

problem there at the southerly end of the Diamond Bridge, at the

intersection of Christie Road and the highway. It's a very bad

situation traffic-wise: traffic that's proceeding north along the

highway, turning west onto Christie Road, and there's no left-turn

slot. There's no room for a left-turn slot — that's the problem, I

understand from the ministry — and also the bridge isn't wide enough.

So I guess it's all part of the whole picture of replacing the Diamond

Bridge. I guess it's just a matter of making sure that when that is

done, there is a provision for safe entry to Christie Road from north

and south, and also an exit from Christie Road.

The Stewart Avenue four-laning, I believe, is going to be

completed this year. I'm hoping that is the case.

Then there is the old question that I have raised.... And if I

had the answer, I'd be glad to give it. I don't think anybody has the

answer. It's that tremendous, or horrific — whatever we want to call it

— intersection of Brechin Road, Estevan Road, Departure Bay Road and

Terminal Avenue North, the Island Highway. What can be done about it to

make it sensible I don't know. Perhaps one day there'll have to be a

vehicle underpass there or something. I just don't know how to solve

that. I wonder if the minister has any thoughts on it at this point.

The only one left is the Gabriola bridge, which keeps raising

its head from time to time. I just want an assurance that in the event

that there's going to be any serious discussion

[ Page 2550 ]

of a Gabriola bridge, there will be public hearings and

opportunity for the public in the area to express their points of view.

[12:00]

HON. MR. MICHAEL: Without any question

whatsoever, if there's ever to be serious consideration of a Gabriola

bridge, I can assure the member, Mr. Chairman, that there will

certainly be public input and public hearings and public meetings. As a

matter of interest to the member, I've been to Gabriola three times now

for a variety of reasons, and have talked to a lot of the citizens over

there. There's a tremendous amount of interest in this question, as the

member is well aware, both pro and con. I think it's something that

certainly has to be vented.

Regarding the number of items the member has brought up, some

of them will be actioned this year and some won't. I'm glad he brought

them up. I sincerely appreciate — not only from this member, but from

all members, whether they are members opposite or members on the

government side — personal briefings on the concerns of the members in

their respective constituencies, because only by being briefed am I

familiar with what their concerns are when I travel to the areas. I

have been and will be attempting to travel through all regions of the

province to get a clear understanding of the concerns, particularly of

the members of the assembly and the members of councils and chambers of

commerce and groups throughout the province. There is nothing that

replaces a firsthand examination. We'll have a good look at these items

you brought up, Mr. Member, and I appreciate your spelling out your

concerns.

Further, regarding comments made about the ferries, yes, we

went through quite an exercise this past year regarding trying to

adjust and rationalize the rates so that they make some semblance of

sense. I think we've gone a long way in that rationalization. I won't

promise that there will not be increases in the future, any more than

members opposite can promise that there will not be any increase in

wages or fuel or other areas of expenses. I do think that we have

rationalized those fares and that you can look at them now and see some

semblance of logic, as far as distance being traveled and things like

this.

Yes, I visited a number of the islands, and we had some very

interesting and memorable public meetings. They were well organized and

well handled, with extremely good input from the people of those

islands. I feel that I have much more feeling and understanding of

their sincere concerns.

Yes, we will be monitoring very closely those increases and

the effect that they've had on volumes and traffic, and the bottom

line. We'll be reviewing that late in the fall. There's no use

reviewing it now because it needs a good number of months from

implementation in order to get a good rationalization. I would say give

it six months, and we'll certainly have a look at the volumes on those

ferries.

Regarding other matters brought up, they're in the record.

Yes, our staff will be having a look at the concerns expressed by the

second member for Nanaimo (Mr. Lovick) and review them to see what can

be done within the financial limitations of the ministry this year.

Also I will be looking at them as to what can be done next year.

As far as the provincial involvement in transportation in the

ferry area, the subsidy is really not very much different from B.C.

Transit. We have been working — at least this year; what it'll be next

year remains to be seen, and what my directions are — in B.C. Ferries

in the area of about 25 percent provincial subsidy, and I think if you

check the records, B.C. Transit is very similar. So all those things

are being looked at.

As far as the committee is concerned, I have to say that I was

not aware that meetings were being called by the B.C. Ferries staff,

other than on the islands affected. That's news to me. I'm glad the

member brought that to my attention. We will have a very serious look —

no promises — at perhaps providing transportation for committee members

when they're going to a meeting with officials of the B.C. Ferry

Corporation to discuss transportation matters. I can also assure the

members opposite that we're looking at revising those agendas somewhat

to provide for more citizen input and advance copies of the agendas

prior to meetings. Those are all in an ongoing process of trying to

work with the committees on the islands in a more adequate, forthright,

upfront manner.

MR. D'ARCY: I'm not going to go through my

earlier request of a week or so ago for a discussion surrounding the

West Trail approach, since there was a most encouraging reply by the

member from Seymour on behalf of the minister, except to say that,

while the reply was encouraging as far as day labour work and municipal

service alteration in conjunction with the city of Trail, of course

what we really want, hopefully later this year, is a contract.

What I want to talk about briefly today is the pedestrian

crossing on the CPR bridge in Castlegar. Your ministry at the regional

level and the district level have slated this for closure either later

this year or early next spring. This pedestrian crossing is an

outrigger on the bridge. It's an absolutely vital link across the

river. It's used more today than it has been for the past 27 years

since the flood of 1960. It's used particularly by senior citizens,

children and parents of young children, especially as there is a very

popular park on the northern end of this particular crossing.

I know the wooden aspect of this outrigger is deteriorating

rapidly and there are various estimates of cost of replacement or

repair. Some say $50,000; others say $90,000 to $100,000. But I would

point out that it is the only pedestrian crossing in the area. The

Castlegar ferry does run on a 16-hour-a-day basis. However, as it gets

more and more aged — and I'm sure you know this, Mr. Minister — its

breakdowns become more and more frequent and the repair times take

longer and longer. Even though there is a transit service using one of

the bridges, this is a most circuitous route to get to and from the

downtown area and the Raspberry-Robson area.

I would hope that the minister will not heed the advice of

some of his excellent regional staff, and will make sure that funds are

provided to maintain this pedestrian crossing and keep it open. As I

pointed out, it is used more today than it has been for the past 27

years, and I can attest to that personally. So there certainly is a

public and popular demand for this particular service.

The last remark I want to make about this, Mr. Chairman, is

that we all know what happens when people want to cross a railway

bridge and they don't have a pedestrian walkway. In many cases they

simply use the ties in any event. The minister I am sure, as well as

Minister of Transportation, knows that this particular bridge is used

on the average about eight times a day by CPR trains, and it has blind

curves on either end. In some cases it might be very difficult for

people to anticipate the approach of a train. So I hope the minister

will reconsider the advice he's receiving.

[ Page 2551 ]

HON. MR. MICHAEL: Mr. Chairman, we will

certainly have a look at that pedestrian crossing. It seems to me we

have some correspondence that has been ongoing on that, and I will

review that and indeed review the advice of the excellent staff members

that you have referred to.

Yes, I believe the member is aware that there will be a start

made on the West Trail approach. That's another example, Mr. Chairman,

of the positive advantages of firsthand review, on-site examination. It

stands out very clearly in my mind, having been there and had it shown

to me by your very good mayor, who pointed out the inequities and the

need for a start on that approach. I can assure the member that there

will be a start made in this fiscal year.

MR. GABELMANN: Mr. Chairman, I have, by

actual count, somewhere over 60 highways-related issues — all separate.

I'm not going to raise them all this afternoon. I've selected six of

the more pressing concerns to residents of the northern half of

Vancouver Island.

The first is the Island Highway itself. I won't make a big

speech about that, but as a person who has driven the Island Highway

from Campbell River to Victoria just short of 700 times — by count — in

the last eight years or so, I find it strange that the Highways

ministry priority for construction starts appears to be on the Malahat.

The most serious problem along that highway exists in the

Bowser area. Essentially, it exists from the Port Alberni turnoff

through to Campbell River, with primary concerns in the region of

Qualicum and Parksville through to Bowser. The second most serious part

of the highway in terms of needed reconstruction is the bypass of

Nanaimo, which all of us on the Island — with the exception, perhaps,

of a few downtown merchants in Nanaimo — think is essential.

I would put third the Ladysmith area and fourth the Malahat,

in terms of priority for construction on that particular highway.

That's my personal view, as I say, having driven it now almost 700

times — I checked my diary just to be sure about that — in the last

eight years. I trust that the minister will recognize those concerns

about the sheer danger of that road in areas north of Parksville. I

hope it's not going to take us ten years.

Secondly, a more local concern. We've now lived with Bailey

bridges in the north end of the Island on the Keogh River and Marble

River. The Keogh is on Highway 19; the Marble is on the road from Port

Alice to Highway 19. Those bridges have been in place and slated for

replacement for years and years and, for some reason, even though they

appear to be near the top of the list of replacement bridges, they

don't ever show up in the budgets. I had really hoped that this year

they would show up, and they still haven't. I trust that the minister

will have a look to see why it is those replacements haven't been made

and, if they can't be done in this year's budget, if they can be slated

for certain in next year's.

Thirdly, the minister and I have exchanged correspondence on

the problem fairly common in North Island, that of public use of

section 88 logging roads. There are several of them. The one I want to

talk about is the one we exchanged correspondence about in the last few

days: the road from Zeballos to the Island Highway, north of Woss.

That particular road goes through the Canadian Forest Products

TFL, then through the CIP TFL into Zeballos. It services Fair Harbour,

which means it also services Kyuquot and points on the west coast. It

is a fairly heavily used road not only for residential traffic but also

for commercial traffic, servicing both Kyuquot and Zeballos. The

minister has replied to me with a memo dated June 29 which I received

on July 14 — interesting time it takes for the mail to go from

downstairs in the building to just across to the east annex — two weeks

plus. In any event, the minister is suggesting that the off-load

logging truck weights and whatever are a problem on a public road. The

minister made no reference at all to the fact that that problem has

been solved in other areas. You can have off-limit logging trucks with

14-foot bunks and excessive weight loads and unlicensed on public roads.

[12:15]

You do it already now, and I don't see any reason why you

can't extend that policy to additional roads. The place you do it

already is between the pulp mill in Gold River and the access road to

that area just near the community of Gold River. I forget how many

miles that is, but it's six, seven or eight miles of what they call

joint-use public road. You have unlicensed 14-foot bunker overweight

logging trucks on what is a joint-use public road, and it happens to be

a paved joint-use road. We're not proposing that we pave the road from

Zeballos to the Island Highway; all we're suggesting is that you change

the category from a

section 88 road to a joint-use road, so I would ask

that the minister have a look at that whole issue. You've already found

a way to avoid the rules that apply in terms of unlicensed, overweight

and overwidth.

Fourthly, I just want to make a brief plea again that the

ministry not lose sight of the fact that there will need to be, at some

point, a road between Tahsis and Woss to link that area. The ministry

has rejected it consistently. I still think that if combined with

redesigned logging plans of both Canfor and CIP, there could be a

considerable amount of that road built for logging purposes, and

ministry responsibility would be lessened as a result. Again, we're not

talking about the kind of expenses that your engineers tell me we're

talking about, because they think in terms of highway standards, and

we're thinking in terms of logging road standards. They're considerably

different. In that territory you can build logging road standards for

$80,000 per kilometre or less, and we really need to look at that kind

of solution.

Fifthly, the minister and I had a brief conversation about

this the other day — Fir Street in Alert Bay. That is the main street

in that town — it's an arterial highway and I trust that moneys will be

found to upgrade that particular highway, although it is essentially a

main street.

Sixthly, and finally, the ferry situation from Port McNeill

servicing Malcolm Island or Sointula, and Alert Bay. It's really not

very satisfactory at the present time, and requires significant changes

by B.C. Ferries. I understand they are discussing changes, that they

are in consultation with the committee that's been established there.

The problem, of course, with the committee is that there are four

people from Alert Bay and four people from Malcolm Island, and they

have very different needs and requirements, but I trust that in trying

to reach an agreeable solution consideration will be made to a new

docking facility opposite Alert Bay to reduce the length of the run

from Alert Bay to Port McNeill.

There is an initial heavy capital cost to build a new docking

facility and if you do it in one location you won't need any additional

road links, so it can be fairly limited in terms of capital. But in the

long term, in terms of the shortened run, I think you will end up

saving considerable money and making the service more effective for the

residents. As part of that whole redesign of those services, it's really

[ Page 2552 ]

essential that an early ferry run be instituted between Alert

Bay and Sointula and Port McNeill. People who work in industry can't

get to work on time. Teachers and bank tellers can get to work on time,

but loggers cannot, because the ferry just doesn't leave early enough.

Normally it's fine that they take their private pleasure boats across.

In ten months out of the year it's safe; the other two or three months

it is really not very safe at all.

The additional benefit of putting in the early run is that

people can get to Vancouver during the day much more effectively than

they can now. Secondly, you'll take the pressure off the second run,

which is the run that contains all the school kids, which is a problem

creating the overcrowding that we have on those ferries because so many

of the kids go to school in Port McNeill. So if you have an earlier

run, you reduce the pressure on that second run — as they call it, the

school run.

So I really ask for serious consideration of that early run,

some rescheduling and perhaps an eventual fourth terminal with two

small craft servicing those four points.

HON. MR. MICHAEL: I once again thank that

particular member for his excellent input. I can say that I am familiar

with some of the areas he's pointed out and not so familiar with

others. It's all on the record, and I can assure the member that we'll

have a serious look at what can be done this year and what can

logically be put on the agenda for next year.

I listened very closely to the suggestion for a road between

Tahsis and Woss, and I can tell the member that I have had at least 15

submissions that I could rattle off, with a little bit of time, of

similar requests throughout the province. I guess one of the things

that we can be thankful for, looking at the Ministry of Forests and the

various companies throughout the province, is that there is a lot of

the infrastructure that we can put on them — a lot of the

responsibility and cost — and then perhaps we can go in behind and work

with the Ministry of Forests, in combination with the Ministry of

Highways, in maintaining, or certainly putting money in the kitty

toward maintaining, these types of roads.

The minister and I are working closely. We've had a lot of

communication and dialogue on these types of projects. Hopefully in the

future we can work even closer together in maintaining and exploring

the possibilities of opening up new avenues for development and

tourism. We are all aware that tourism is a tremendously growing

industry in the Province of British Columbia, and certainly a lot of

people are adventure seekers and would like to get out into the areas

where they can explore and look around. They're looking for loop roads

or circle tours where they don't have to come back on the same road

from whence they went up on.

HON. MR. STRACHAN: From whence they came.

HON. MR. MICHAEL: From whence they came;

thank you, Mr. House Leader. Having been a grade 11 dropout, I never

for my grammar.

The one thing — in getting close to closing, Mr. Chairman and

fellow members — is that, in looking at highways, yes, we've had a

reduction in our budget this year of 11 or 12 percent, and it's been

pretty tough. I can say that there are some positive aspects. A lot of

things are going on in the province in the various comers. We haven't

been able to satisfy all the requests, and I suppose we never will.

Just in passing, I would like to make a remark about one

simple fact that hasn't been mentioned; perhaps it's not in my field to

mention it. If we do not bring the health care costs in this province

and in this country under control quickly, we're not going to have any

major projects or all the roads, highways, bridges, ferry services and

other transportation things we need.

I look back and examine the money being spent by Health; we

know it's needed and it's an excellent case. Unless we bring that

budget under control, we're going to have less rather than more

highways, because it's truly eating up more and more of the budget.

Just as a matter of interest, I went back 25 or 30 years to all the

budgets in British Columbia and did a five-year overview every year.

Back 25 or 30 years, the Ministry of Highways used to get 22 percent of

the provincial budget. Today we're getting somewhere around 9 percent.

In that same time-frame, Social Services and Health and

Education combined used to take about 28 percent. You look at those

three ministries now, and they're eating up two-thirds of the

provincial budget. So those trend lines are going to have to be brought

into some type of balance and check, because the requests, as witnessed

since yesterday afternoon, are very long. I would love to satisfy all

the requests and needs, but we have to work within the budget as set

down by the government.

Mr. Chairman, it's been a pleasure listening to the various

concerns of the members. Apparently there is still one more to go.

Taking note of all the concerns and requests, we'll be working with the

members. I'll repeat in all sincerity: my door is always open. Several

members have been into my office outlining their individual concerns to

me, and I welcome similar visits in the future.

MS. SMALLWOOD: I know there are a lot of

people very concerned about the issue that I'm going to bring up, and I

was concerned that we weren't going to get the time. I'd like to remind

the minister of a few questions that I put to him during question

period several months ago and some of the subsequent news articles that

followed from that. On April 7, the big headline in the Vancouver

Sun was: "Minister Aids Socred Pal's Non-Union

Truck Firm." That

article was about some of the questions we raised

regarding the New Westminster highways contracts in Richmond — the

Fraser River bridge connection. It has been four and a half months

since any work was done on that site. During question period I asked

the minister if he would assure the House that that work would

continue; that the contracts would be taken away from Ike Unger and

Maxim and Sonny, and let to a firm that had employees and could finish

that work.

I have a couple of concerns beyond the fact that there hasn't

been any work at that site for about four and a half months. I

understand that the holders of those contracts are looking for other

contractors to bid on the work there; they would have the bonding

companies turn over the contracts to another company to complete the

work. There are audits going on at this time, and those audits are

looking to see whether the employees' benefits — their CPP and the

other items that they have to pay — are taken care of. Can the minister

assure us (1) that work will continue; and (2) that those

companies will not get out from under that labour bond that is held,

and that those labour bonds will be used to pay for the employees'

contributions to their pension plan, to

[ Page 2553 ]

unemployment insurance and so on? Can the minister advise us

what is happening at that site right now and why there hasn't been any

action, and assure this House that there isn't political intervention

at this time?

HON. MR. MICHAEL: I thank the member for

raising this matter. At this very moment it's under active review by

our senior staff, and we're looking at the entire matter. There have

been some problems. One of the principals had a serious heart attack, I

think the third or fourth one, and is not in very good health. We have

been very tolerant in attempting to see a resolution brought about, and

I don't think the member is going to have to wait much longer to see

some action in that area.

As far as the bonding is concerned, we will certainly ensure

that any holdbacks, or any employee wages that haven't been paid, will

be paid. That's part of the process, as I understand it from my staff.

As far as reviews by the Minister of Labour or the labour board

regarding UIC and WCB contributions, that's a matter for another

ministry; hopefully that will be worked out by the proper authorities.

I'm not aware whether this problem exists, but if it does exist, it

will certainly be worked out. The laws of the land are very simple:

employers must make contributions for employees' UIC and WCB.

MR. SERWA: There are a few things I would

like to address briefly to the minister. In Transportation and

Highways, I would like to suggest that a dual budget be developed; that

basically there be two levels. We have a situation that exists

currently where we have local highways districts, and when we undertake

major capital projects, such perhaps as the Coquihalla or the Island

Highway system, we impact heavily on planned local projects.

What I would like to see is that a budget be set up so that

the approved local projects go through and the accommodation for those

projects isn't impacted by the demands of the higher-profile

provincial-type projects. I think I would like to impress on the

minister that his ministry probably impacts the greater area of British

Columbia most heavily. It really fuels the economy. Transportation is

the ingredient, the catalyst that we all require, and it fuels the

economy of this province.

It is my opinion that a great deal more capital has to go into

Transportation and Highways. The last major injection of funds into our

highway system throughout the province of British Columbia occurred in

the sixties when we expanded the standard of our highways. A lot of

these highways are deteriorating and a great deal more capital

expansion has to go into them.

For a stable source of funding for Transportation and

Highways, it is my belief also that this ministry is so important that

we have to be able to plan five years and ten years ahead with a stable

source of budget. The minister has indicated that the budget has been

impacted very heavily by social aspects of the provincial budget. I

feel that either we have to come up with an alternative source of

funding for our capital projects in our highways system, or else we

have to be able to reserve and preserve the priority of highways, as

its position in the province is so prominent and so important for our

future. It is the only source from which we can get the economic

viability in our province to fuel the funding of all the other

services, such as Social Services and Housing, Education or even Health.

[12:30]

MR. LONG: I'd like to bring to the House's

attention that in my riding we've been neglected in highways for

approximately 15 years that I know of. I think the last time there was

any amount of work done was 25 years ago.

MR. MILLER: You say there's politics in

highway development?

MR. LONG: I've got to thank the minister

for the three bridges that are going in the Bella Coola Valley that are

very much needed. They were one-way bridges. They've taken away a

hazard that the people up there were having to live with on an ongoing

basis. I'd also like to thank him for some of the things that are

happening there, including some pavement that would be with it.

There's one area, though, that I'd like to ask the minister

about, and that's the Sunshine Coast highway, 101 through to Powell

River and through the Sechelt and Gibsons area, which is in drastic

need of repair. Is anything planned for this particular highway in the

future? I'd like to have him answer me.

HON. MR. MICHAEL: I sincerely thank that

member for his input and questions. I know that he's related a number

of problems in his constituency to me since being elected. I can assure

him, regarding the particular points that he's made now, that our staff

are making note of them; they're in the record. We'll be reviewing to

see what can be done in this fiscal year. If something can be, we will

give you a report; and if it can't be, we will also give you a report

and let you know what the chances are for getting that done in the near

future. I thank the member for his question.

Vote 61 approved.

Vote 62: administration and support services, $14,759,725 —

approved.

Vote 63: highway operations department, $726,974,820 —

approved.

Vote 64: motor vehicle department, $33,961,110 — approved.

Vote 65: transportation policy department, $86,909,512 —

approved.

HON. MR. STRACHAN: I move the committee

rise, report resolution and ask leave to sit again.

The House resumed; Mr. Speaker in the chair.

The committee, having reported resolution, was granted leave

to sit again.

Hon. Mr. Strachan moved adjournment of the House.

Motion approved.

The House adjourned at 12:35 p.m.

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