1975 Legislative Session: 5th Session, 30th 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)

THURSDAY, JUNE 26, 1975

Night Sitting

[ Page

4065 ]

CONTENTS

Miscellaneous Statutes Amendment Act, 1975 (Bill 142). Committee stage.

Amendment to

section 11. Hon. Mr. Hall — 4065

section 11 as amended. Mr. McClelland — 4065

Report and third reading — 4066

Committee of Supply: Department of Transport and Communications estimates

vote 250 Mr. Schroeder — 4066

On vote 257. Mr. Wallace — 4091

Legislation estimates

On vote 1. Mr. Wallace — 4092

Committee of Ways and Means — 4094

Supply Act No. 3, 1975 (Bill 131). Introduction, first reading, second reading,

committee, report and third reading — 4095

Motions

Motion 14. Mr. Smith — 4095

Royal assent to bills — 4096

THURSDAY, JUNE 26, 1975

The House met at 8 p.m.

Orders of the day.

HON. E.E. DAILLY (Minister of Education): Mr. Speaker,

committee on Bill 142.

MISCELLANEOUS STATUTES

AMENDMENT ACT, 1975

(continued)

The House in committee on Bill 142; Mr. Dent in the

chair.

section 11 — continued.

HON. E. HALL (Provincial Secretary): I ask leave of the

House to move an amendment without notice on

section 11 of Bill

142. The amendment has been distributed to all Members and, by

leave, I will proceed.

MR. CHAIRMAN: Leave is not required, I believe, in

committee. Anyone can move an amendment at any time.

HON. MR. HALL: Right. I wanted to make sure that we were

doing this right.

AN HON. MEMBER: Hunky-dory!

HON. MR. HALL: I want to thank the Member for Langley (Mr.

McClelland) for pointing out to us that by order-in-council on

April 1, 1975, we had proclaimed

chapter 81 of the 1973

statutes. Therefore the amendment to the bill would read:

"Section 3 of the Social Assistance Act is amended by

renumbering the

section as subsection (1) and adding the

following:"....

The following, Members, would then be the essential thrust

of what does appear in Bill 142. We are not changing the

principle. So those Members who have speeches worked out

already don't need to alter one jot of them. I therefore move

the amendment.

Amendment approved.

section 11 as amended.

MR. R.H. McCLELLAND (Langley): Mr. Chairman, I understand the reason

for this. It gives the government pretty wide-ranging powers, however, to set

rates in private institutions. I wonder whether or not it is really necessary

and whether or not, regardless of the court case, the government expects there

will be more court action if they didn't proceed any further with this. It seems

to me that in most instances now the government does set the rate that it pays

in any institutions in which it has people who are under the care of the province,

at least. Perhaps the Minister could just explain a little further why this

section 1s necessary. We are always a little leery about the kinds of powers

contained in this

section to deal with a particular segment of the community.

HON. N. LEVI (Minister of Human Resources): Mr. Chairman, in

the Supreme Court of Canada judgment, they upheld the

definition that the hospitals could charge any reasonable rate.

You may know that there were a number of cases. There is yet to

be a settlement in respect to this. This case has gone on now

for over four years. We feel that we cannot really, in terms of

the Social Assistance Act and the people with whom we deal,

have the hospital set the rates because of what they feel are

reasonable rates. We are having some trouble now, as a matter

of fact, in terms of this. Since we have been here, we have

adjusted the rates three times.

What we would like to do is to introduce this, which would

give us the kind of control we thought we had under the Social

Assistance Act, in terms of the definition, which we did not

have. This has been a matter of practice in the province for

many years, that the government sets the rates. It wasn't until

1969 that the private hospitals stated that the rate was

insufficient; and it was then that they started a series of

cases.

What we want to in fact do is to be able to set the rates by

law, as was the practice, but was not law. Once we have

concluded this, we have to meet, as we have been meeting, to

try and finalize the settlement of the cases.

We have had some very good meetings with the committee that

has been working on behalf of those municipalities involved. I

would hope that we can make a resolution of this problem,

certainly by the summer, to settle the cases.

MR. McCLELLAND: Just one further question, Mr. Chairman. Is

the Minister convinced that there is no way a negotiating

procedure could be set up such as is done with the dentists and

the doctors and other groups, with the private hospitals and

other facilities such as that, so that a rate could be struck

on a regular basis once a year, or renegotiated every six

months or something like that?

HON. MR. LEVI: Since May 1, we are being billed at higher

rates than we are actually paying. We are having some

discussions about this. Of course, people are saying to us: "If

we can't get these rates, we are going to go back to court." We

could be constantly in the whole situation of going back and

back to court.

[ Page 4066 ]

As I have said, we have raised the rates three times to try

and assist the private hospitals. But we really must have the

opportunity to set the rates. If we are going to have to

negotiate with a whole series of private hospitals, it will be

extremely difficult. Really we would like to return to the kind

of arrangement we had previously, except that obviously it

would have to be put into law, and this is what we are

doing.

Section 11 as amended approved.

Title approved.

HON. MR. HALL: Mr. Chairman, I move the committee rise and

report the bill complete with amendments.

The House resumed; Mr. Speaker in the chair.

Bill 42, Miscellaneous Statutes Amendment Act, 1975,

reported complete with amendments, read a third time and

passed.

HON. MRS. DAILLY: Mr. Speaker, Committee of Supply with

debate, with leave.

Leave granted.

ESTIMATES: DEPARTMENT OF

TRANSPORT AND COMMUNICATION

(continued)

The House in Committee of Supply; Mr. Dent in the Chair.

On vote 250: Minister's office, $131,898.

MR. H.W. SCHROEDER (Chilliwack): Some quick questions just

to start the ball rolling. Could the Minister please give us a

progress report on the new ferries that are being built? Are

they expected to be delivered on time? Is the cost going to be

anywhere near what the anticipated cost was? How soon will they

be in service?

HON. R.M. STRACHAN (Minister of Transport and

Communications) : I get monthly pictorial reports indicating

that the ferries will be available May or June of next year. As

you know, two of the ferries were on a fixed price, except for

some part of the shafting, so the cost was very close to the

price I gave to you a year ago. I expect them on line by June

of next year.

MR. SCHROEDER: Does the Minister have any advice for the House as to

on what runs these ferries are going to be put into service? Is it going to

be the Swartz Bay–Tsawwassen? Is it going to be the Horseshoe Bay–Departure

Bay run, or are there other runs anticipated?

HON. MR. STRACHAN: It will either be on route 1, which is

Swartz Bay–Tsawwassen, or route 2 which is Horseshoe

Bay–Departure Bay. There are still some discussions going on as

to where they will be placed — as a matter of fact we were

discussing it just yesterday. I think the likelihood is that

they will be on route 2 which is Nanaimo to Horseshoe Bay.

MR. H.A. CURTIS (Saanich and the Islands): Mr. Chairman, the

Minister would be crestfallen, I think, if, during discussion

of his estimates and, indeed, during question period on a

fairly regular basis, I didn't ask a question regarding the

proposed Gabriola ferry terminal. In what I believe to be a

fairly mellow mood on the part of the Minister as this session

comes to a close, and realizing that the inquiries and the

questions and comments to the Minister date back over so long —

two and a half years or more — I would hope that the Minister

is now at a point where he could be very frank with the

committee, and therefore with the people of the province, and

tell us precisely where we stand with regard to what hag been

talked about for so long — that is, a possible change at both

ends of route 2, Nanaimo to Vancouver.

We waited patiently for a year, I think — subject to

correction, but about a year — for wind-and-wave studies. We

were told then that the basic wind-and-wave study information

had been referred to the masters who have to sail the ships.

That was also some time ago.

If I may say so, Mr. Chairman, I think the Minister owes it

to the people of the greater Nanaimo area, the mid–Vancouver

Island area and, indeed, to the people of the province as a

whole, because of what has happened in Departure Bay with some

expensive changes there which, presumably, will be useful for a

number of years. I realize that at the other end of the run, in

Horseshoe Bay, there is a problem, and I would like to hear

about that, too.

I emphasize that perhaps the time — late June in this spring

session — would be right for the Minister to tell us all he

possible can on this particular subject. Because whatever

happens or does not happen in that area will have significant

effect on the development of the midsection of Vancouver

Island.

HON. MR. STRACHAN: Certainly. First of all, I'm always in a

mellow mood, as you all know.

It was two years last February that I made the announcement

that it was my hope that we would be able to develop a

much-shortened route which would overcome some of the morale

problems which a continued 10-hour shift creates on such a run.

The Member outlined the different committees that had to

examine the proposal. Because of the economic

[ Page 4067 ]

and social impact which any ferry terminal would have on

Gabriola Island, it's now in the hands of the Environment and

Land Use Committee whose duty it is to advise every department

of government as to what economic and social impact any of

their proposed actions will have in any given area of the

province. So that is where it still remains.

This will not prevent us from using the ferries when they

are on line to upgrade the whole service on practically every

run. So that's all I can tell you. I'm waiting for the report

from the Environment and Land Use Committee.

MR. CURTIS: That is the answer that was given a number of

weeks ago, I think during question period. Would the Minister

indicate, therefore, when he would expect the ELUC to bring

down an interim report or a final report on this particular

subject? Again, I have to ask about the possibility of the

downtown Nanaimo area.

Really, I shouldn't have to be asking these questions. I

think that perhaps the MLA for Nanaimo, the Hon. Minister of

Agriculture (Hon. Mr. Stupich), is interested in this and must

be concerned about it. I receive inquiries from people in the

Nanaimo area who want to know, in effect, what is going on.

Is the Minister or his department examining an alternative

in the event that the ELUC report is negative or unfavourable

with respect to staying in Departure Bay or relocating at

Gabriola or that vicinity? What about downtown Nanaimo and the

availability of land in that area for a major terminal? I

recognize, as I'm sure the Minister will tell us, that this

would involve additional sailing time and, therefore, crewing

problems and related difficulties. But is there an alternative

in the event that ELUC gives you a report which is not

favourable?

HON. MR. STRACHAN: I think you're referring to the

suggestion which came from Nanaimo — I think it was the

regional district — that we go to the assembly wharf in

Nanaimo. The word we have on that, as I recollect it.... I

read a report the other .day which said that the B.C. Ferries

will not be able to use the assembly wharf area for any ferry

terminal. So that's out. So if we can't go to Gabriola Island,

it looks as if we're stuck in Departure Bay. We've no other

alternative that I can see.

MR. CURTIS: Any timetable on ELUC, Mr. Chairman? That was

the first part of the question.

HON. MR. STRACHAN: I am informed that an interim report

should be ready in a couple of months.

While I'm on my feet talking about ferries, there have been many statements

made about a $25 million loss in ferries — and it's been repeated and repeated

in this House. I want to inform the House that from the very first day of the

ferry service, that ferry service has required moneys from the Public Treasury

of this province from day one, because the legislation under which the B.C.

Ferry Authority operated had within it — and I was in the House when the legislation

passed — it requires an annual payment to the ferry authority of 2.5 per cent

of the capital requirements of the whole ferry system. If you go through these

public accounts, and I have them here, you will find that....

Interjection.

HON. MR. STRACHAN: It's all right, it's all right. I've been

listening all session to accusations of losses, losses, losses

using public moneys for the B.C. ferry system. I'm informing

you that right from day one the ferry service has had public

money. I ask you to look at the 1965-66 public accounts. You'll

find a sum of $41 million shown on the liability side of the

ledger in the report of the B.C. Ferries. You go to the public

accounts of 1967 and you find exactly the same amount shown on

the asset side of the ledger, plus another $10 million. That's

$41 million dollars in one year right out of the general

revenue of the taxpayers of the province into the ferry

service.

I never objected to that because the ferry service is a

service to the people, and that is a cost of the service.

That's a cost of service. It's not a loss any more than the

money we spend on highways is a loss to the Highways

department, any more than the money we spend on hospitals is a

loss to the hospital service.

My friend, I say to you that the ferry service of British

Columbia is the finest in the world.

Interjections.

HON. MR. STRACHAN: If you want to stand up here and condemn

the crews of the ferry service, you go right ahead. But I tell

you that courtesy and cleanliness are the watchwords of that

ferry service, which is the finest in the world. If you want to

stand up here and run down the people who work in the ferry

service, you go right ahead; go right ahead. But I want you to

recognize that fact — $41 million in one year from the

taxpayers.

Don't talk to me about losses. That's the cost of the

service to the people? I want you to recognize that fact. You

don't like the truth, do you? That's the truth.

I want to remind you also that, like it or lump it, the

ferry service, though the number of people and the number of

cars we carry has increased by 50 per cent in three years,

still maintains the finest ferry service in the world — 50 per

cent in three years!

[ Page 4068 ]

Interjection.

HON. MR. STRACHAN: All right, you don't like it, but those

are the facts. To stand there as you've done, talking about a

loss, a loss, a loss — that's the cost of providing the service

to the people of this province. If you don't want that, then

stand up and tell me that you want me to increase the fares or

cut the service. Stand up and tell me that you want the fares

increased or the service cut. You haven't got the guts to do

it. You haven't got the guts to do it; that's what's the matter

with you.

MR. CHAIRMAN: Order, please!

HON. MR. STRACHAN: It's the truth — $41 million in 1966.

Don't talk to me about a $25 million loss. That's what it cost

to carry the service to the people. Have the guts like a man to

stand up and say increase the fares or cut the service, or shut

up!

MR. W.R. BENNETT (Leader of the Opposition): A shocking

performance.

MR. CHAIRMAN: Order, please.

MR. H.A. CURTIS (Saanich and the Islands): Woof! I apologize

to the committee for suggesting that the Minister was in a

mellow mood. If the Minister wants some rational discussion

tonight on his estimates, or if the tirade we've just

experienced is the tone he wants to set for the discussion of

his estimates, then so be it. But I would remind the Minister

that it wasn't an accusation in this House which produced this

headline from The Province on May 8 this year. "Ferry Loss to

Top $25 million." Harvey Southam is the correspondent: "B.C.

ferries will likely lose more than $25 million during the

1974-75 operating season, Transport Minister Robert Strachan

indicates."

Interjection.

MR. CURTIS: Now I think that the.... And we've heard a

great deal from Prince Rupert in the last few days.

Mr. Chairman, I think that the Minister has done his estimates and this committee

a disservice in the last few minutes with that programmed explosion which was

supposed to, perhaps, put us on the defensive or something. I have no idea what

his tactic was. We want to discuss the British Columbia Ferry Authority which,

Mr. Chairman, we did not have an opportunity to discuss during the three and

a half hours when the Minister's estimates were up earlier. So that was a very

brief afternoon spent and most of it of necessity had to be devoted to ICBC.

So it's up to the Minister tonight, not to the opposition, I suggest: does he

want to act responsibly and discuss his estimates in a responsible fashion with

Members of this committee, or does he want to give us tirade after tirade? That's

his choice; it doesn't really work with me. So what's his choice tonight?

HON. MR. STRACHAN: Well, that was no tirade. I have listened

to tirade after tirade for the last four months. I was just

setting the record straight. That's all I was doing.

There's something else I would like to remind the Members

across the way about. In the first annual report that I ever

tabled in this House, prepared by the former Minister of

Highways, Mr. Black, on my instructions there was included in

that report, for the first time since 1968, information

regarding route-by-route costs of the B.C. ferry system, and

they are in this report too — the kind of information that was

never before available to the House. It's in the public

accounts again if you want to go through the public accounts —

the cost and the revenue and expense for each year.

You can call me all the names you like, the fact remains

that in order to maintain the service we are maintaining,

despite the explosion of its utilization, it costs that kind of

money. That's what it costs the taxpayer to provide the

service. As I said before, we have two choices: either increase

the fares or cut the service. It's a cost to the taxpayer.

For instance, the Gabriola ferry. That little ferry each

year probably costs about half a million dollars more than it

takes in, but it's a service to the people of Gabriola and the

people of British Columbia.

Is that a loss? Are you going to classify it as a loss? Are

you going to say that we should up the rates on that Gabriola

Island ferry so that the income equals the expenditure? I want

a rational debate, but I don't want the kind of accusation I've

been suffering through for four solid months — tirade after

tirade after tirade. I'm just putting it straight: that this is

a service for the people, and any time the taxpayer wants to

make revenue equal expenditure, and if that's what you want,

tell me either to cut the service or increase the rates.

Interjections.

MR. CHAIRMAN: Before we proceed, I would just draw to the

attention of the Hon. Members standing order 40,

part 2: "No

Member shall use offensive words against any Member of this

House." I would ask the Hon. Members to exercise greater

discretion in their choice of words.

MR. SCHROEDER: Mr. Chairman, I want to ask the Minister

whether he was trying to have the House, and hence the people

of British Columbia, believe that on the dates that he

mentioned and the $41

[ Page 4069 ]

million that he cited out of the public accounts... is he

trying to have us believe that in those years there was $41

million worth of loss? Is that what you were saying?

HON. MR. STRACHAN: No, no. I said it was out of the Public

Treasury.

MR. SCHROEDER: You tried to have the House, the press and

the public believe that there were $41 million worth of

losses.

AN HON. MEMBER: That's what you said.

MR. SCHROEDER: That is not true because I happen to have the

figures of the estimates that were voted and the total

expenditures for the B.C. Ferries for the certain number of

years starting in 1966 and through 1967 when the accounting

procedures were changed, right up through and including 1974.

In most of these instances, Mr. Minister, the total amounts of

expenditure aren't even equal to $41 million, so there's no way

that we can have $41 million worth of losses. I don't want the

people to be misled into thinking or believing that there were

$41 million of losses. Now tell the truth in this House!

Interjection.

MR. SCHROEDER: I want to read to you, and I have the

floor.

AN HON. MEMBER: Go ahead; you're the one who cracks.

MR. SCHROEDER: I have the floor.

Let's go from 1974 and go backwards. Are you interested?

Just to set the record straight, in 1974 the estimates voted

$46,547,000-plus for the expenditures of the B.C. Ferries. The

actual amount of expenditure, according to this research, is

$56,760,000 for an over expenditure or a net loss of

$10,213,000. That was reported in 1974. Reported in 1973: the

amount voted for the B.C. Ferries, $34,546,000 — actual

expenditures $43,738,000 for an over expenditure or a net loss

of $9,191,000. In 1972: the comparative figures were

$29,844,000 actually voted and $39,185,000 actually expended

for a comparable loss of $9,340,000. Now we go back to 1971 and

the amount voted in the estimates was $28,696,000. This is

HON. MR. STRACHAN: I've got it here.

MR. SCHROEDER: Then the actual expenditures for that year —

$26,401,000. For the first time, the balance is the other way —

HON. MR. STRACHAN: You've got the wrong figure there.

MR. SCHROEDER: Why is it wrong?

HON. MR. STRACHAN: Well, because you didn't look at public

accounts.

MR. SCHROEDER: We've got the total amount of expended

figures for 1971 — $26,401,000. I give you a chance to stand

and correct it if it's wrong.

HON. MR. STRACHAN: It is wrong.

MR. SCHROEDER: In 1970 the amount voted was $29,719,000 and

the actual amount expended $28,101,000. Once again for a

surplus in that year. 1969 it was $22 million voted, $20

million spent. In 1968 there was an overage of $1,624,000.

I will not have that Minister stand in this House and have

the people of this province believe, by his statement a few

minutes ago, that there were losses equalling some $41 million

in any one given year. Not even the Minister has that bad a

record. Not even the Minister himself in his worst year has

that bad a record.

Therefore it came as a bit of a shock to the people when he

announced that there would be something like $25 million-plus —

and I've heard other figures bandied about — but a $25 million

plus loss in the present operating year, when up until 1971 the

figures.... If the ones that I have here are not absolutely

correct, they are certainly within the ballpark. This was

researched, so we know that it was within the ballpark.

Now in 1967 and prior, the figures are given to us on a

broken-down basis even better than from 1968 through 1974. It

tells us not only what the revenue from the services was — $20

million — it tells us what the actual expenditures were, $16

million. It tells us what the capital expenditure out of income

was and the amount that was paid in lieu of depreciation, for'

a net expenditure there of $1,600,000. Together with the

interest that was earned...can you believe it — interest

earned out of temporary investments on the ferry service? Have

you heard of anything like that recently? Interest earned on

temporary investments of $175,000 — not enough to write home

about, but at least there was a balance. There we are — an

overage in that year, 1967, of $1,815,000. If I haven't made a

believer out of you, Mr. Member for North Vancouver–Capilano

(Mr. Gibson), then we'll have to read back even further than

I'd like to hear what the Minister has to say about the $41

million loss.

HON. MR. STRACHAN: I tried to explain to you that in making

a comparison between the money

[ Page 4070 ]

expended on the ferries and the revenue ferries obtained, it

should not be referred to as a loss but as a cost to the people

of the province for providing a service.

MR. SCHROEDER: It's an operating loss. Tell the truth.

HON. MR. STRACHAN: I reject the word "loss." It's a cost to

the taxpayers, and that was the point I was making. In one year

there was $41 million taken from the taxpayer and transferred

into the B.C. Ferries. That's what I said.

MR. SCHROEDER: Was it capital or was it operating? Can you

tell us that?

HON. MR. STRACHAN: It was a cost to the taxpayers. I will

not accept the word "loss" with reference to the operation of

the ferries. It's a cost to the taxpayers, and that's all it

is.

Some of your figures were wrong, and if you want to examine

any up-to-date issue of public accounts, you will find that it

gives you five years in a row.

I agree with you that until 1967 the amount of money that

was taken in in revenue was greater than the amount of money

that was paid out in operating. It was in 1968 that we started

to turn that corner where that was no longer the case. That was

really the reason why the B.C. Ferry Authority as such was done

away with, and it was brought into the Department of Highways

so there would no longer be that side-by-side differentiation.

From that day until I became the Minister, there was never any

detailed information of any kind provided to this House. I had

it put into the annual reports.

All you had up until that time was an amount allocated to

the ferries over here, and then on the revenue side, at the

very beginning of the estimates book, was the other figure. If

you look at 1968 — I think it was, or was it 1969 — you will

find that was the first time there was an estimated difference

of $3 million between the amount of money you took in and the

amount of money it cost to operate the ferries.

MR. SCHROEDER: A short question, then. Would the Minister

tell us, please — the $41 million, to which you referred, would

the Minister tell us how much of that was capital expenditure

and how much of it was operating expenditure? Tell us so the

people will know, because there are some who know the

difference between capital expenditure and operating

expenditure.

HON. MR. STRACHAN: I don't think it makes any difference to the taxpayer

whether the $41 million was capital; it was a cost to the taxpayer. I want to

get that into your head: the cost to the taxpayer is the only thing that matters.

The cost to the taxpayer.

MR. BENNETT: Like ICBC.

HON. MR. STRACHAN: The cost to the taxpayer.

Interjections.

HON. MR. STRACHAN: Speaking of ICBC. Again I get

misrepresentations. I read statements by people that say,

"Despite the fact that ICBC has received $120 million of the

taxpayers' money, there is still a deficit of $30 million."

ICBC hasn't had one penny of taxpayers' money so far.

AN HON. MEMBER: The Minister sure crawled back down the pipe

on that one.

MR. CURTIS: Yes, indeed. The Minister backed all the way to

Tsawwassen after those figures were presented to him, and that

is one of the problems we have with this Minister when we seek

rational debate. I wish he had been in the House yesterday

morning when we were discussing the estimates of the Hon.

Provincial Secretary (Hon. Mr. Hall). In spite of his years in

the House, he would have learned quite a lesson as to how to

respond to questions and engage again in rational discussion of

the public business and the public money.

HON. MR. STRACHAN: You give me rational questions, and

you'll get....

MR. CURTIS: Don't start pointing at me, Mr. Minister. It

doesn't impress me at all. It doesn't intimidate me at all

either, Mr. Minister.

HON. MR. STRACHAN: You don't intimidate me.

MR. CHAIRMAN: Order, please. Would the Hon. Member speak to

the vote, please.

MR. CURTIS: Speaking to the vote. We had a discussion a few

days ago in connection with Bill 127, Mr. Chairman, and the

possible federal subsidy with respect to the Princess

Marguerite. The Minister of Transport and Communications has

spoken about subsidies in the past, seeking federal subsidies.

I seek a response from him how to give us an update on his

attempts, or the government's attempts, to obtain subsidization

from the federal authorities for the British Columbia ferry

fleet.

HON. MR. STRACHAN: Thanks for the lecture Mr. Member. I want you to

remember what I have been subjected to from across the way for four months.

But thanks for the lecture anyway.

[ Page

4071 ]

SOME HON. MEMBERS: Oh, oh!

HON. MR. STRACHAN: As far as the federal government is

concerned, they are still displaying the same attitude toward

the west coast and our needs as they have done right through.

They refused to give the previous administration help with the

ferries. So far, they are refusing to give us any help except

the same subsidies anyone else gets on the construction, this

despite the fact that right now they have leased another ferry

for service on the east coast at a cost of $3 million a year,

and they have purchased other ferries for the east coast. There

is a brief that was prepared and distributed to every MLA, and

it amounts to millions and millions of dollars each year.

Then we find again a service to the people, the St. Lawrence

Seaway, and you look at the figures for the St. Lawrence

Seaway. This is in eastern Canada again. As I say, the previous

administration went through exactly the same thing as we are

going through — this absolute refusal of Ottawa to recognize

the transportation needs of the west coast.

When I was back east, I asked the Minister of Transport

about the St. Lawrence Seaway. If you look at the total

revenue, for instance, of the St. Lawrence Seaway for 1973, you

find their total revenue was $28 million; their operating costs

were $38 million more than that; their interest payments are

$35 million. Out of a total revenue of $28 million, their

operating costs were $35 million on top of that and interest

payments were $35 million. They have an accumulated deficit of

$102 million and outstanding debt, loans and deferred interest

of $758 million.

You know where that money is going to come from. It is going

to come from the taxpayers of Canada, including the taxpayers

of British Columbia.

Interjection.

HON. MR. STRACHAN: No, this is a service to the people of

Canada and it costs the taxpayers money. I am simply saying

that we have a service here that costs the taxpayers money and

we should be getting the same kind of help in British Columbia

that is extended to the east coast and central Canada through

the St. Lawrence Seaway.

Interjection.

MR. CHAIRMAN: Order, please.

HON. MR. STRACHAN: The federal Department of Transport hired

a firm of consultants to make a study of west coast

transportation needs. One of the first things I had to do when I became Minister was to meet

with that particular firm; I think it was Aikers & Co. I

kept asking for the report, asking for the report. They delayed

it and delayed it. Finally, at a meeting, one of these federal

public servants blurted out the reason why they were unwilling

to release it: the magnitude of the costs involved in the

recommendations of that west coast transportation report was so

great that they just didn't want it to be made public. That is

what we are facing on the west coast — a cost of tremendous

magnitude to provide the coastal transportation required.

Certainly I was very pleased the other day with the initial

runs of the hydrofoil. I think it opens up some new

possibilities for speedy transportation which might change our

coastal transportation habits. I have to get a report from my

staff as to the economics of that kind of ship and its

utilization and the traffic we could expect from it. But I

think it will open up new avenues of transportation between the

islands and up and down the coast and between Vancouver Island

and the mainland.

As far as the help from Ottawa, there is no indication yet

that they are going to change their pattern of help.

MR. CURTIS: On a brief follow-up, does the Minister

anticipate an official representation to Ottawa on this subject

in the near future? You indicated that it has been discussed

for quite some time. You reminded us that you have been in

Ottawa recently. But what happens next? Is there a delegation

going to Ottawa in the near future to once again present the

British Columbia case on this particular subject, perhaps in

concert with other subjects?

On the question of the hydrofoil, I suppose it is too early

to ask the Minister if his staff has had an opportunity to do

any kind of in-depth assessment after the four or five days, I

believe, of trials with the Boeing Jetfoil which was here. I

was particularly interested in discussing the Jetfoil with B.C.

Ferries management and learning that really when one has....

The $7 million figure sounds pretty steep. But when one is

looking at several millions for construction of conventional

ferries, as an example, the vessels of the type of Bowen Queen

and Mayne Queen.... I think one of your management people

indicated to me that probably the replacement cost of those

vessels today — and these are not the major route vessels —

would be in the neighbourhood of $4.5 million. It does give an

additional perspective.

Certainly it is to be hoped that B.C. Ferries will look

very, very carefully at the Jetfoil hydrofoil thing. Indeed,

that may be the next major step for B.C. Ferries to take in the

growing transportation system we have.

So, Mr. Minister, what about Ottawa and decisions

[ Page 4072 ]

on the Jetfoil?

HON. MR. STRACHAN: As I said, I have had no report yet from

my staff on the economics of the Jetfoil, nor even their

professional assessment of it as a ship. As an individual, I

was certainly impressed with its performance, its speed, the

fact that it created no wash at all at 50 miles per hour, which

is pretty important in the waters that are used so much by

sport fishermen.

It burns diesel fuel: it can re-track to go over a log if it

hits or it can slice right through it. That's an amateur's

assessment of it. I am waiting for the professional assessment

and their economic report that I haven't had yet. However,

already initial discussions have taken place between members of

my staff and Ottawa in the hope that we can embark on a joint

experiment perhaps with one or two of them in different routes

on the coast. But that is not finalized; simply initial

discussions have taken place on the possible use of Jetfoils,

for a new type of transportation perhaps downtown to

downtown.

MR. CURTIS: Downtown to downtown?

HON. MR. STRACHAN: Yes, that's the sort of thing we're

looking for.

HON. G.R. LEA (Minister of Highways): Mr. Chairman, I'd just

like to say a few remarks on what I consider the opposition is

trying to do. They're trying to compare apples and oranges.

Until 1968 in this province there were tolls on a number of

bridges within this province, so there was a revenue factor

generated within the Department of Highways. There was money

generated from those toll bridges. So if you're going to use

the same kind of criteria that the opposition has been talking

about, then over the years under the Social Credit government

the Department of Highways had a loss that is staggering. This

year I can say as a prophet that the Department of Highways in

the Province of British Columbia is going to suffer a loss of

$272 million, if we're going to use the same criteria across

the board.

Getting back to the apples and oranges, until 1968 the B.C.

Ferries were under a Crown corporation and had the power to

borrow money, which they did. The money was paid off from two

different avenues of revenue: one, the money that came in, that

people paid to ride on those ferries, and one from the toll

bridges that were out through this province. But in 1968....

Interjection.

HON. MR. LEA: No, just 1968. Oh, there was one other amount of money

that went into that system — that was 2.5 per cent of grant funds from statute

grant funds.

In 1968 the B.C. Ferries were taken under the Department of

Highways. At that time, the money that was owing from that

ferry system was paid off out of general revenue.

SOME HON. MEMBERS: Oh, oh!

HON. MR. LEA: So you can't compare apples and oranges, but

that's what you're trying to do. The fact of the matter is that

there was money owing when those ferries came into the

Department of Highways, which was paid off out of general

revenue. During the period when those ferries were running.

Interjections.

HON. MR. LEA: Yes. Also, at the same time the toll bridges...the money from those was used to pay off the money owing on

those debentures. So you can't compare apples and oranges. The

fact of the matter is that the Minister of Transport and

Communications is absolutely right; you can't talk about a loss

in the ferry area or you have to talk about a loss in the

Department of Highways; you have to talk about a loss in the

Department of Health and in Education and in every area where

public money is being used to supply a service to people. You

can't have it both ways, and that's what you want to do. The

fact of the matter is that it was up until 1968 that you were

talking about — the Member for Chilliwack (Mr. Schroeder) — and

that is absolute hogwash.

MR. SCHROEDER: In 1968....

MR. CHAIRMAN: Order, please! Could I say my line first? The

Hon. Member for Chilliwack.

MR. SCHROEDER: Thank you, Mr. Chairman. Let's start in 1968

when we compare oranges with oranges. By the way, if the

Minister of Highways believes that all net losses are going to

be expenditures because they are a cost to the people of the

province, then I suppose that that is the rationalization

process whereby they are going to try to dissolve away the

losses of ICBC and say that you can't call it a loss, strictly

because it's a cost to the people.

AN HON. MEMBER: That's right.

MR. SCHROEDER: I suppose that's the next step. I'd love to

see you run a business.

HON. MR. LEA: I'd like to see you run one. Have you ever run

one?

[ Page 4073 ]

MR. SCHROEDER: Yes, I have.

HON. MR. LEA: What was it called?

MR. SCHROEDER: It's none of your business. (Laughter.)

HON. MR. LEA: That's right.

MR. SCHROEDER: Let's go from 1968 and find out what the

balances were.

HON. MR. LEA: There's big money in what you're in.

Interjections.

MR. SCHROEDER: At least we don't have a loss column.

In 1968 what was the balance of revenue over expenses — this

is oranges with oranges — $1,624,000; 1969, revenue over

expenses, $1,625,000 — very close; 1970, $1,617,000 — again

very close; 1971, $2,295,000. The big deficits that you don't

want to call losses....

Interjection.

MR. SCHROEDER: Do you want to call it deficits instead of

losses?

HON. MR. LEA: Capital expenditures.

MR. SCHROEDER: We start — $9 million in 1972; 1973, $9

million; 1974 ...

Interjections.

MR. SCHROEDER: ...$10 million. I thought you'd remember

that, Mr. Minister. There you are, comparing oranges with

oranges, Mr. Minister of Highways.

HON. MR. LEA: What about the capital expenditures?

MR. SCHROEDER: It looks bad no matter which way you call

it.

HON. MR. LEA: Baloney!

HON. MR. STRACHAN: I want the people of British Columbia to

note this, that the official opposition are serving notice to

the people of this province that if ever again they become the

government of this province, they will cut the ferry

service.

I want the ferry workers to know that they will cut the wages of the ferry

workers in this province. Cut wages! Cut service! That's what they will be doing.

I want the people of this province to note this very well, they have served

warning. If they ever become the government, they'll cut the wages of the ferry

workers, they'll cut the service to the people of the province. They'll increase

the fares to the people of the province.

That's what they want to do — ignore everybody all over the

province that want to use the ferries. Don't vote Social Credit

or they'll charge you more, or they'll cut the service, or

they'll cut the wages that's what they're saying.

MR. D.A. ANDERSON (Victoria): I wrote to the Minister a

short time ago and he replied, and he said in his letter about

ICBC that he wanted to re-introduce the competitive bidding

system, and he shakes his head now agreeing with me.

He went on to say: "Unfortunately once again, and especially

in Victoria, the body shops got together and simply refused to

accept the re-introduction of the competitive bidding system

for auto-body shop repair work."

Well, I've been trying to find out, Mr. Chairman. I've been

checking with all the body shops in Victoria, and they don't

seem to agree with the Minister's

interpretation of their

views. They seem to think that they'd be very happy with

competitive bidding. They feel that if they had competitive

bidding you could wipe out hundreds of people involved in the

ICBC assessment offices, where they check on what the damage is

to 'vehicles, and they would like to see competitive bidding,

so I'm assured. I would like to know from the Minister when

he's going to make a real effort to get competitive bidding

re-introduced.

I might say I appreciate the Minister's enthusiasm for

competitive bidding, because it's sort of a free enterprise bit

of competition which I think the Minister should approve of and

it's just in the same vein I would suggest to him that we

should have another insurance company so we can have a little

free enterprise bidding there.

That's one question. The next is of the surcharge the

Minister is permitting up to $18.50 per hour, but most shops in

this area are charging $20 and they claim indeed that the $20

an hour is not competitive at the present time. They're losing

money. They're concerned about the dates; as the Minister

knows, there's a three-month delay before there can be any

change and they're pretty worried that there are going to be a

lot of body shops which are losing money.

The shops at the present time are, of course, limited thanks

to the present strike. I'll try and get that element out of the

discussion. I'd like to know whether ICBC has paid any of the

differential, the

[ Page 4074 ]

surcharge between the $18.50 and the $20 anywhere around the

province. Are they paying that? If so, are any people getting

this surcharge reimbursed? Now, if indeed, Mr. Minister, we are

going to go to competitive bidding, and if indeed the

competitive bidding leads to prices which are higher than $20,

1 would assume that you would be paying the full shot.

Third area of questioning is the betterment of their

vehicles. Betterment: this is where a vehicle gets involved in

an accident; because it's in an accident they clean up, say,

the front end and the vehicle winds up in better condition than

it was prior to the accident. It puts the vehicle in a better

condition than prior to the accident and it is, as my colleague

says, a good thing.

Now ICBC has been particularly tough on this, particularly

tough, and the two companies that used to be tough were State

Farm and Allstate, and we find that there are a lot of former

State Farm and Allstate people in ICBC and I think there's a

curious coincidence here.

I think that if a person has an accident and they have to

fix up the car, they shouldn't be paying this fairly heavy

surcharge for betterment which is becoming more and more a bone

of contention with those dealing with ICBC. They get their car

fixed, the body shop charges them a surcharge they never

expected to have to pay and didn't have to pay in the days of

private insurance, then in addition, ICBC says "well, the car's

better than it was before, therefore we're only going to pay 60

or 70 per cent of the body shop cost anyway," and then

they knock the surcharge off that.

So I wonder whether the Minister would comment on those

three points, and in particular, on the re-introduction of the

competitive bidding system.

HON. MR. STRACHAN: First of all, the letter I wrote to you

was absolutely correct. Let's start at the beginning. The

executive secretary of the ARA, Mr. Lloyd Kinnaird, came to

ICBC before we were in business, told ICBC that he represented

body shops in the Province of British Columbia.

Interjection.

MR. CHAIRMAN: Order, please!

HON. MR. STRACHAN: I don't know what you're talking about.

Get up afterwards. I'm recounting to you the history. The ARA,

let me put it that way, came to.... You'll have your say when

I'm finished...came to ICBC and said, "We represent the body

shops of the Province of British Columbia. We'd like to

negotiate a raise with you."

Negotiations took place — I think Evan Wolfe was on the committee, as a matter

of fact. It was agreed that the rate be $14.50 — agreed! Now they were asked

if they had the authority to talk for the body shops and they informed ICBC,

"Yes." So this rate was struck.

Immediately afterwards, within weeks, I found from Duncan,

for instance, that the body shops there announced that they

were going to start making a surcharge. The body shops in

Duncan, which is my own constituency, asked if they could have

a meeting with me. I said "you can have a meeting with me as

your MLA but not with me as the president of the Insurance

Corp. of British Columbia."

MR. D.A. ANDERSON: You should have resigned as

president.

HON. MR. STRACHAN: So they came to me and I told them the

story and I asked them. I said, "Did you give ARA the authority

to bargain for you?", and each of them said, "Yes."

Then I said, "Why are you refusing to work for the price

that the ARA agreed upon?"

They said, "Well, we just don't like the agreement they

made." And that was the situation we were faced with.

In different parts of the province, people for whom the ARA,

and to whom these body shops had given the authority, simply

because they didn't like the agreement ARA had reached, said,

"To the devil with it" and started to make a surcharge.

Then I said, "All right, let's go back to the competitive

bidding system."

MR. D.A. ANDERSON: Right!

HON. MR. STRACHAN: And they said, "No."

MR. D.A. ANDERSON: What? Duncan or the ARA?

HON. MR. STRACHAN: No, the individual garages.

AN HON. MEMBER: In Duncan?

HON. MR. STRACHAN: In Duncan and in Victoria. So that

information I have — that they refused.

So if you can get these people to write to me and tell me —

because I've received no letter from any group of body shops

anywhere in the province saying that they want to go back to

the bidding system. You get them to write me a letter and we'll

certainly take a good hard look at it. Because that's the

actual experience.

In more than one place where the surcharge was being applied

when we went to try and institute the bidding system, they

either did something they had never done before, which was

charge the potential

[ Page 4075 ]

customer a fee for providing a bid, or simply refused to

make a bid at all. So there it was.

Insofar as the betterment of the vehicle, I'd have to check

into that. The ICBC is not paying the surcharge to the best of

my knowledge anywhere.

MR. D.A. ANDERSON: Are you sure?

HON. MR. STRACHAN: To the best of my knowledge. As you know,

there is a strike on right now. It's very difficult to pursue

the normal practices of talking to the body shops because we

just simply haven't the people.

MR. D.A. ANDERSON: Just a quick little supplementary. Id

like the Minister now to comment upon the strike itself. He

said that these body shops are not cooperating and they've got

this wretched surcharge which he doesn't like, nor does the

public like it, I might add. I'd like to point out that now

we're in this strike situation, the ICBC has advised the public

that they are to take their cars to cooperating body shops.

I'm quoting here... "a cooperating body shop is one that is

not charging the motorist any amount in excess of the

deductible and is charging the corporation's previously agreed

rates."

Now apparently there are very few of these. There are not

that many, and I wonder what happens to the poor motorist

caught in a strike situation who just happens to make a mistake

and go to the wrong body shop. It appears that they are

strictly out of luck and they're not getting the cheques which

they would otherwise be receiving.

The problem is, you see, that the union has a somewhat

different approach than ICBC and the customer is in a very

difficult position at the present time.

There is some talk that if the vehicles — and I'm quoting

now the Office and Technical Employees Bulletin of May 30 —

"The union and its members consider that any body shop which

repairs vehicles in accordance with the corporation's

procedures will be strike-breaking, In this event the union and

the employees of the ICBC would have no choice but to react

accordingly."

Nobody knows how the union would react. There is talk of

documents getting lost once the strike is finally settled and

people never getting paid. I don't think that would happen; I'm

not sure. But nevertheless there's a real bind here. And the

public are caught.

I wonder whether the Minister tonight could tell us whether he will publish

lists of the cooperating body shops and whether he will make sure that anybody

who does deal with the cooperating body shop is not subjected in the future

to any harassment or any difficulty because he has done something which the

Office and Technical Employees Union regards as strike-breaking.

HON. MR. STRACHAN: First of all, I read with interest every

comment made by the Office and Technical Workers' Union. I read

with interest every publication they made. But because I knew

that eventually both parties would have to get around the

bargaining table again, rather than escalate any differences

that have existed, rather than add to a climate that was not

too amicable, I refrained from either saying that that is not

true, or making any comment on any of the kind of statements

you have been referring to. I deliberately avoided it. I didn't

want to escalate a "you said, I said, you said" sort of

situation, because I knew eventually it would have to get back

to the table. And it doesn't make it easy to start negotiating

again if you are coming out of that sort of name-calling

contest. I know that from experience.

They are now sitting around the bargaining table and have been for

two days. I really don't want to make any comment on the kind of

statements you were reading, except to assure you that the management

of ICBC will not stand for any kind of discrimination between the body

shops as to what they did or what they didn't do during this

unfortunate period.

You referred to the fact that the public are in a bind. That

always happens when there is a strike situation.

MR. D.A. ANDERSON: The bind, Mr. Minister, is because of the

original memorandum of May 27 about the cooperating body

shops. I am not necessarily sure which shops these are.

HON. MR. STRACHAN: The first bulletin the management issued — and this was after a survey of shops — came out because it

was obvious there were a number of shops which were willing to

collect from the individual only the deductible part. There

were others who simply demanded the whole thing.

Once the strike is over, it will be a substantial job for

the corporation to determine the fairness of some of the

charges that have been made to some people who have had to pay

the full amount. It will be a very substantial job. I have had

reports of the kind of charges that some body shops have been

making which are obviously far higher than they should be. And

they are demanding full payment from the customer before the

vehicle is released. So it will be a substantial job in at

least spot-checking many of the bills that come to us. But, as

I say, it is a strike situation, and nothing is normal during a

strike situation.

MR. SCHROEDER: In view of the fact that the results of ICBC

show a net loss — although the

[ Page 4076 ]

Minister doesn't like the word — of some $34 million in

Autoplan, and in view of the fact that the Minister has stated

on several occasions that not one penny of subsidy is going

into this Autoplan, I want to hear the Minister say that this

year's premium income is being expended in last year's

operating costs and last year's claims, and that we can foresee

for this year an accumulated deficit, since there will be no

subsidy, according to his word, an accumulated deficit of $34

million plus whatever the operating deficit is for this

year.

HON. MR. STRACHAN: At no time have I said that a subsidy

would not be required.

Interjections.

HON. MR. STRACHAN: No, no. I said....

MR. SCHROEDER: You said not one cent has been paid.

HON. MR. STRACHAN: I said....

MR. SCHROEDER: Not one cent has been paid.

Interjections.

MR. CHAIRMAN: Order, please.

HON. MR. STRACHAN: That's right.

MR. SCHROEDER: Not one cent has been paid.

HON. MR. STRACHAN: That's right.

MR. SCHROEDER: Not one cent has been paid.

HON. MR. STRACHAN: That's right.

MR. SCHROEDER: So, in other words, Mr. Minister, you are

using this year's premium income to pay last year's operating

expense and claims.

HON. MR. STRACHAN: No, no, no.

MR. SCHROEDER: Where are you getting it from?

HON. MR. STRACHAN: Look at the balance sheet.

MR. SCHROEDER: Where are you getting it from? Then you are

using the reserves?

HON. MR. STRACHAN: No, look at the balance sheet.

MR. SCHROEDER: You are using the reserves? You look at the

balance sheet, my friend. There is a $34 million net loss after

reserves. So that means that you are using this year's premium

income to pay last year's operating costs and last year's

claims. It doesn't add up any other way. Mr. Minister, tell me

which way it is.

HON. MR. STRACHAN: Again I say that we are not using any of

this year's premium to pay last year's claims.

AN HON. MEMBER: Read the balance sheet.

AN HON. MEMBER: Impossible to balance.

MR. G.F. GIBSON (North Vancouver–Capilano): I would like to

come back to the British Columbia Ferry system and raise with

the Minister a problem which I know is bothering him and has

been bothering me for months and years. That is the problem: no

federal subsidy for the B.C. Ferry system. This is a charge,

Mr. Chairman, which is essentially paid by the people of

British Columbia. It is not paid by the people from outside the

province, be they Canadians from other provinces or other lands

who come here and ride on our ferries. It is paid by British

Columbians, because we pay the deficit of the ferry system.

HON. MR. STRACHAN: The cost of the ferries.

MR. GIBSON: The cost of the ferry system — the "balance of

revenue," as the banks call it, we pay.

Mr. Chairman, I know that this Minister is a good Canadian.

One of the first things he did when he came into this

government was put the signs back on the Trans-Canada Highway,

call it like it should have been and so on, I guess he's maybe

been reluctant, because of that kind of feeling, to consider

that perhaps there should be some kind of differential charge

on the B.C. ferry system. But I want to suggest to him that

perhaps there should be.

You know, Mr. Chairman, in this Confederation we live in,

it's a balance-of-power situation, and to perfect that balance

of power it's sometimes necessary for the provinces to stand up

on their hind legs and say that this is our right, and this is

what we demand. I say to you, Mr. Chairman — and I know the

Minister agrees because he said so in this House this session —

that what is our right and what we demand is a subsidy for

British Columbia and the ferry system that is commensurate with

what the eastern provinces get in subsidies for their ferry

systems. That's only fair.

Sometimes to make Ottawa see the light you have to indulge

in just a little bit of what you might call friendly guerrilla

action, or something like that. You

[ Page 4077 ]

sometimes have to fight fire with fire. So I want to suggest

to the Minister that there should be on the British Columbia

ferries what I would call a lack-of-federal-subsidy

equalization charge. I'd just put that in quotes, and I'd put

that on top of a special ticket. Then whenever a car drove up

with licence plates from British Columbia I'd say to them: "God

bless you, you've already paid the lack-of-federal-subsidy

equalization charge in your taxes. Get aboard the ferry; we'll

just charge you the regular." But when a car came up from the

rest of Canada or from out of the country, I'd say: "Well now,

this isn't quite fair because you fellows haven't paid the

lack-of-federal-subsidy equalization charge. And had things

been working right, you would have paid it through your

Canadian taxes. But things aren't working right and we aren't

getting that here in British Columbia, so, unfortunately, now

you're here at the ferry gate and we have to assess you at this

point."

Therefore I would suggest to the Minister — and I wish

he'd think about this very seriously — that every car with a

non-B.C. plate that showed up at the ferry terminal should be

charged the regular fare, of course, naturally; then after that

it should be charged an extra $5. And you give them a ticket

saying that this pays up their lack-of-federal-subsidy

equalization charge. You give them a little pamphlet with that

to explain exactly how it is, because it's a fairly complicated

case, Mr. Minister, and one which you've made many times in

this House, but it's an equitable case. Canadians from other

parts of the country who come here to enjoy British Columbia,

and people from Washington state and so on, would say: "Well,

God bless us. We didn't know that British Columbia was being

treated this badly by the federal government in respect to the

ferry system. Now that we read this story, we're happy and

willing to pay that."

So, Mr. Minister, I would suggest that you put that kind of

charge on until Ottawa finally comes through and does the right

and honourable thing by British Columbia and gives us for our

ferry system what they give to the rest of the country.

HON. MR. STRACHAN: Now, Mr. Chairman, you know Ottawa won't

even know that the B.C. ferries are now part of a department of

government.

MR. GIBSON: We've got to give them a little something,

though.

HON. MR. STRACHAN: They still charge us and will not remit

the federal sales tax.

MR. GIBSON: We've got to give them a little trouble, though,

HON. MR. STRACHAN: It was okay when it was a separate Crown

corporation, all separate, but it's part of a department.

Now what mitigates against your suggestion and don't think I

haven't considered it, because I have. When we talk about the

loss or cost of the B.C. Ferries to the people of this province — that $25 million cost I've been hearing so much about — I

think you have to remember, as we were told today by another

Minister, that the tourist industry of British Columbia

provides $840 million. That's $840 million from tourists! How

much of that goes to make up that $25 million cost I've been

hearing so much about? Probably more than that amount comes

because we welcome tourists to this province.

AN HON. MEMBER: That's a guess.

HON. MR. STRACHAN: Well, as a guess. I said that it was

probably more than that.

MR. L.A. WILLIAMS (West Vancouver–Howe Sound): Don't

guess.

HON. MR. STRACHAN: Pardon?

MR. L.A. WILLIAMS: You've got four guys over there — don't

guess. Give us the answers.

HON. MR. STRACHAN: Well, I don't know how you'd separate

that $840 million. But the thing is, if you start making that

kind of extra charge on tourists who come to Vancouver Island,

I suggest to you that the merchants of Vancouver Island would

be most unhappy because it would then be a clear indication

from tourists all over North America that if you're a tourist

in this province you're going to have to pay extra. That would

spread all over North America, and I suggest to you it would

have a very deleterious effect on the tourist industries. I

think it would, that kind of discrimination.

And that $840 million industry is a pretty substantial

source of wealth-creation in the Province of British

Columbia.

MR. GIBSON: Mr. Chairman, just a very brief follow-up

comment. I acknowledge and respect the Minister's argument. In

return, I would suggest to him that it wouldn't be

discrimination; it would just be charging to those outside the

province the same kind of tax or rate to ride on the ferries as

those of us within the province already pay through our normal

rates. So it wouldn't be discriminatory.

But perhaps even more important than that, Mr. Chairman: I

would suggest that this lack-of-federal-subsidy equalization

charge would only have to be on for two or three months before

the federal government would begin getting the

[ Page 4078 ]

message because dimly, from the outlying provinces, there

would start trickling through the jungle telegraph the idea

that something was happening out there in the far-flung reaches

of British Columbia. Something was happening.

HON. MR. STRACHAN: You know better than that.

MR. GIBSON: If we were able to embarrass them enough, Mr.

Chairman, just possibly we would be able to make the point that

there was something wrong here and that Ottawa should look at

it.

Sometimes it is as good to raise a little chuckle as

anything else. I think that Ottawa would have to respond to

this because they would be embarrassed — there would be

questions asked in the House of Commons. The Minister would

have to stand up, kind of rub his toe on the rug and say: "Aw,

shucks." But that's about all he could say because their case

is so bad. So, Mr. Chairman, I just commend that again to the

Minister's attention. I hope he thinks about it over the

summer.

MR. N.R. MORRISON (Victoria): I would like to change the

subject just slightly, if I may, and discuss with the Minister

the problem of the tow-truck operators. Could the Minister

advise us if there is more than one uniform contract for rates

for tow-truck operators through the Province of British

Columbia, or does ICBC have one standard rate?

HON. MR. STRACHAN: I'm informed that there is one standard

rate.

MR. MORRISON: Well, thank you, Mr. Minister. That was my

information also. But I happen to have in my possession right

now two different rates, both approved by ICBC, apparently, and

both being paid by ICBC — prior to the strike. I would like to

give it to you after the House so that you could have a look at

it. I understand there are different rates, and those operators

who are being given the lower rates, here on the island and in

Vancouver, are concerned now that they have located this other

set of rates because they believe they have been misled by ICBC

who have assured them there is only one rate, yet they have

both copies.

HON. MR. STRACHAN: My recollection was that there is a

Tow-truck Operators Association, and negotiations took place

with the Tow-track operators Association for the one rate.

MR. MORRISON: But there are two rates.

HON. MR. STRACHAN: Okay, you send it over to me. It was my understanding

and my information that there was one rate. But you send it over and I'll check

it out after the strike is over.

MR. MORRISON: I would like to go on to another subject. Some

time ago I spoke to the Minister on a series of questions

concerning government aircraft. I received this brochure, which

I have shown you and which comes from your department. It lists

that you have 10 government aircraft, on the bottom of page 4.

I asked the airport one day if they would give me the letters

of the aircraft, and they gave me 11. I would assume that one

of those aircraft has been given or sold to somebody, but it

still appears to be on this list. I have the letters for you if

you want them later.

Then I looked up the logs that you filed with the House, the

last series of logs, and I came across some rather interesting

items. I would just like to cover them with you.

In the logs for April, 1974, it would appear that only seven

out of the 10 or 11 — I'm not sure which — flew. There were

either three or four that didn't fly at all. In May, 1974,

there were only six aircraft used. In June of 1974 there were

only five aircraft flown. During July of 1974 only five

aircraft flew. August of 1974 only five aircraft flew. October

of 1974 only five aircraft flew.

AN HON. MEMBER: How many were there?

MR. MORRISON: Well, 10 or 11. I'm not sure whether there are

10 or 11 now.

MR. D.M. PHILLIPS (South Peace River): Do they depreciate on the ground?

MR. MORRISON: In November, 1974, they actually used seven of

them. December of 1974 you used six. January of 1975 you

actually got eight of them in the air — mind you, one of them

wasn't there for very long. February, 1975, seven of them flew.

March of 1975 eight aircraft flew. So I would like some

understanding of what is happening to our aircraft fleet.

I had also asked the Minister a series of questions

concerning the use of government aircraft by other people; that

is, people other than the provincial government. I asked him if

we had received any revenue from any source for use of B.C.

government aircraft. To the best of my knowledge he hasn't

replied to that. He did tell me that occasionally the RCMP do

use B.C. government aircraft. Now whether we get paid for that

or not, I don't know.

I also asked him about the Department of the Environment

which apparently had used one of the government aircraft to

test an inertial navigation system. I asked if we had received

any revenue for that, and I don't believe the Minister

answered

[ Page 4079 ]

whether we were paid for it.

While I am on that subject, it is my understanding that one

of the 10 or 11 aircraft is to be used again this year for some

form of use with the federal government in the Department of

the Environment, and that there are quite a number of hours

likely to be used. Do we get paid for it?

I also want to know what our insurance situation is if that

aircraft is being used by someone other than the provincial

government.

I asked the Minister if he would file with the House the

insurance carrier and the insurance forms, which as yet has not

been done. I also asked him if he could give us some indication

of what the load factors are on some of the trips, and he

hasn't filed any of that information yet. I also asked him if

we rent or lease any additional aircraft for any use in the

Province of British Columbia, and he hasn't answered that yet.

HON. MR. STRACHAN: You have asked about a dozen questions

already.

MR. MORRISON: You want me to go one at a time?

HON. MR. STRACHAN: Yes, ask me a question, please.

MR. MORRISON: All right, Start then and tell me about the

use of the 10 or 11 aircraft that we appear to have. How many

of them do we own?

HON. MR. STRACHAN: First of all, some of the questions you

say I haven't answered yet — if you go through Hansard , you'll

find the answers.

MR. MORRISON: I did go through and you didn't answer

them.

HON. MR. STRACHAN: I have listed in my book 11 aircraft —

CF-BCL, CF-BCN, CF-BCD, CF-BCF, CF-BCE, CF-BCG, CF-FHF, CF-BCN,

CF-BCO, CF-BCB, CF-BCC.

MR. MORRISON ; That's 11.

HON. MR. STRACHAN: Yes.

MR. MORRISON: All right.

HON. MR. STRACHAN: Okay. One of them is going to Selkirk

College; one of them has already gone to Burnaby Vocational

School.

MR. MORRISON: Gone?

HON. MR. STRACHAN: Oh, yes.

MR. MORRISON: When?

HON. MR. STRACHAN: Oh, there was a picture in the paper a

month ago...

MR. MORRISON: I know that.

HON. MR. STRACHAN: ...of them being towed up the main

street at 3 o'clock in the morning.

MR. MORRISON: Okay. Which one of those aircraft went there?

HON. MR. STRACHAN: Well, that's the time you move a thing of

that kind up the Main Street. That would be the CF-BCB.

MR. MORRISON: I don't have that on my list and I've still

got 11. (Laughter.)

HON. MR. STRACHAN: The reason that some of the aircraft

probably don't show on those logs is that in the July-August,

for instance, they're not operating as passenger-carrying

aircraft. They're full-time on aerial photography for the

Department of Lands.

MR. MORRISON; Yes, but you still filed those logs showing aerial photography

on some of them — I've got some of them right here in front of me. You show it

as a photo trip on each one.

HON. MR. STRACHAN: There is one plane based in Kamloops.

MR. MORRISON: Yes, I've got that.

HON. MR. STRACHAN: That's a De Havilland Beaver, CF-FHF —

which is why you couldn't find it out at the airport.

MR. MORRISON: But you filed the logs for it and there are

periods where it doesn't fly.

HON. MR. STRACHAN: What?

MR. MORRISON: The Minister filed the logs for that

particular aircraft and there were months when that aircraft

didn't fly — wasn't in the air. Those logs were filed among the

others. There are logs here for literally every one of these

aircraft.

MR. CHAIRMAN: Order, please. I would ask the Hon. Member if

he couldn't perhaps stick to.... We've been allowed some

latitude but we are dealing with the Minister's vote — with

vote 250.

MR. MORRISON ; Certainly this comes under his responsibilities.

[ Page 4080 ]

MR. CHAIRMAN: There are specific votes for the aircraft.

Also, it would seem that some of these questions would probably

be more appropriate in public accounts. However, I would ask

the Hon. Member to proceed just bearing those two points in

mind.

Interjections.

HON. MR. STRACHAN: If you want, write them all out and send

me a memo. It used to be that nobody was allowed within two

miles of that hangar. As you know, I changed all that and you

are able to walk in and out of there and see what's there.

That's the way it's going to stay. That's the way it's going to

stay. Nobody was allowed anywhere near that hangar — within two

miles of that hangar — under the old administration, but the

doors are open. You walk in and out there as you please as you

know.

Anyway, if you write out all those questions on a memo, I'll

see you get all the answers. How's that?

MR. MORRISON: Thank you, Mr. Minister. I appreciate that and

I will do that because I would like to have the answers. I

would also like the House not to be misled — those hangars were

always open. I was in and out of them. (Laughter.) Don't

mislead the public either because none of us get the use of

those aircraft. I specifically recall the Minister saying to

me: "Over my dead body will you ride in those aircraft even if

the seat's empty."

HON. MR. STRACHAN: Oh, I never said that.

MR. MORRISON: Yes you did, sir. You just look in the logs

and find out when we used them unless we were taken at the

invitation of a Minister in any one of those aircraft. Yet

there are aircraft flying on a daily basis to and from

Vancouver obviously with a load factor which is not 100 per

cent. There are many empty seats going back and forward on that

flight.

You have a scheduled airline running and you don't have a

licence for it. It's only available to your friends and to your

employees, not ours. We have no use for it so don't mislead the

public by telling them that we do. Don't mislead that public by

saying that hangar is any more open today than it has ever

been. Anybody could walk in those hangars at any one time.

HON. MR. STRACHAN: Ask Andy Stephen. Go ahead, ask him. Go

out in the corridor and ask him now.

MR. MORRISON: If Andy Stephen couldn't get in the hangar he didn't know

how to open the door because it wasn't locked — it's never been off-limits to

anybody. In the 20 years that I have been on that field I have been into every

single hangar with no difficulty. Today you'd have a little difficulty because

it's now fenced. I realize that you didn't have anything to do with the fence;

that was a federal government responsibility. That has nothing to do with keeping

people in and out of hangars.

But don't mislead the public to believe that those aircraft

are any more available. I'm not saying that they were before

but they're not any more available.

HON. MR. STRACHAN: I certainly didn't say that you were

being allowed to utilize aircraft now — I didn't say that.

MR. MORRISON: You certainly left the impression that you

were.

HON. MR. STRACHAN: No. I said that no one was allowed near

the hangar to examine that hangar, what was in there, ask

questions....

MR. MORRISON: That's baloney; that's rubbish.

HON. MR. STRACHAN: Never before has there been an annual

report with a

section "Transport operation and air services

branch" listing it all — listing the aircraft. It used to always

be hidden in roads, bridges and wharves — the whole thing.

MR. D.F. LOCKSTEAD (Mackenzie): I hear the Hon. Member for

Columbia River (Mr. Chabot) still chirping. However, after the

next election he won't be here to chirp.

Mr. Chairman, just a few brief remarks in regard to the

questions to the Minister. I've listened patiently to the

remarks about deficit financing of the ferries. I want to tell

you something, Mr. Chairman. In my riding, these ferries are

our highways. No resident in my riding can travel anywhere

without travelling on a British Columbia ferry or a B.C.

Department of Highways ferry. These ferries are, in effect, our

highways.

I know very, well that we do, as a matter of fact, finance

highways. We do not have tolls on highways. I want to repeat

that I favour the Minister's policy. I think that all the

people of British Columbia, as well as people from other parts

of this country and continent, use these ferries regularly,

frequently, and I think that we should all pay our fair share.

Further to that, Mr. Chairman....

MR. G.S. WALLACE (Oak Bay): Take the charges off altogether;

be consistent.

MR. LOCKSTEAD: Good idea. Why not? Further to that, Mr.

Chairman, since these ferries are our highways, I would suggest

that people in my riding who are permanent residents of the

area should have

[ Page 4081 ]

priority loading privileges. It is my personal feeling that

anyone who is at a ferry terminal one-half hour prior to

loading time should have first rights to board before any

non-residents in my area. After all, we do depend on these

ferries for our transportation services.

Another point, Mr. Chairman, I would like to ask the

Minister to consider is free transportation on our ferries for

our senior citizens. Why not? Why shouldn't our senior citizens

have the privilege of travelling on our B.C. ferries or

Department of Highways ferries at no cost? Why not?

Another item that I would ask the Minister to consider, Mr.

Chairman, is the matter of youth groups in my riding. We have

Girl Guides, we have the Member for Columbia (Mr. Chabot), we

have Little League teams, soccer teams, Boy Scouts, Brownies,

all these youth groups. Now I do understand, Mr. Minister, that

school groups do travel at no cost during the school week on

the ferries. However, I feel that these groups of young people

should, particularly between Mondays and Fridays.... I see no

reason why they cannot be allowed passes to travel free on our

ferries.

In closing, Mr. Chairman, I'd like to offer my

congratulations to the Minister and management of the B.C.

Ferries and the Department of Highways in my riding, these

people who have so greatly improved the scheduling and the

ferry service, and I look forward to further improvements in

the system; and there had better be.

One other item, Mr. Chairman, while I'm on my feet. I'd like

to point out that the morale of the crews on the various

vessels, and I travel on all of them at one time or another,

has increased significantly since we have become the

government.

HON. MR. STRACHAN: I want to thank the Member for his

remarks. There are group rates for school children, old-age

pensioners and other groups. There are group rates on some

runs.

Interjection.

HON. MR. STRACHAN: Well, is that where you belong? As a

matter of fact, on one route we actually transport the

passenger free — the old-age pensioner free — and all we

collect is the payment for the bus, the cost of the bus

carrying each passenger.

MR. McCLELLAND: A few words about the Insurance Corp. of

British Columbia. I just want to assure the House that there is

no split in our caucus.

HON. MR. STRACHAN: Would you please start again? I couldn't

hear.

[Mr. Lockstead in the chair.]

MR. McCLELLAND: Thank you, I hadn't said anything yet, Mr.

Chairman.

I wanted to say a few words about the Insurance Corp. of

British Columbia and ask the Minister a question or two. I get

a kick out of the myth that the Minister attempts to put

forward that there's never been any subsidy, not one penny of

subsidy to ICBC from the public purse. Yet his own colleague,

the boss of that group over there, the Minister of Lands,

Forests and Water Resources (Hon. R.A. Williams), the red-faced

Minister, in Madison, Wisconsin, June 14, 1975.... Just about

a week ago he was in Madison, Wisconsin, telling a left-wing

group in Madison about the great socialist government that

they've established up in British Columbia, and his words

were:

"Two years ago, in addition, we established the Insurance

Corp. of British Columbia, ICBC, locally known as Icky

Bicky."

AN HON. MEMBER: Is that what he said?

MR. McCLELLAND: Yes, that is what he said.

AN HON. MEMBER: He didn't call it Moscow Mutual?

MR. McCLELLAND: No, he didn't refer to it as Moscow Mutual

at all. He called it Icky Bicky.

He said "Overnight we created in British Columbia the

largest insurance company in Canada, and overnight all

automobile insurance became tied to the driver's licence and

the public corporation." Then, just a week ago in Madison,

Wisconsin, he said: "While we have subsidized the system,

partly out of an increase in the gasoline tax..."

SOME HON. MEMBERS: Oh, oh!

MR. McCLELLAND: "...there is no question that the people

are basically getting better service at a lower cost."

MR. L.A. WILLIAMS: Who said that?

MR. McCLELLAND: The Minister of Lands, Forests and Water

Resources last week in Madison, Wisconsin. And that Minister,

Mr. Chairman, stands up in this House tonight and says that not

one penny of subsidy has ever gone to ICBC. Somebody is

lying.

Mr. Chairman, I know that this government had a great idea

and wanted to establish the Insurance Corp. of British Columbia

as their socialist dream, and it would have been a good idea if

it had been carried out correctly. But instead it has turned

into a nightmare of political interference. I refer to the

column by Allan Fotheringham in tonight's Vancouver Sun . It

says:

[ Page 4082 ]

" Down goes another one at ICBC. Jack Margach, who has been

filling in as chief counsel ever since Terry O'Grady left,

resigned on Monday. There is a feeling that ICBC hardly needs a

legal department, considering the way the Victoria dabblers are

dabbling.

"...ICBC is simply a political football, and is run by

Premier Barrett and Provincial Secretary Ernie Hall in concert with ICBC boss

Norman Bortnick. Bob Strachan, the Minister in charge? Out to lunch."

So says

the

article — out to lunch.

Mr. Chairman, I don't know whether or not that part of it is

correct, but certainly there has been too much political

interference in the operations of the Insurance Corp. of

British Columbia.

AN HON. MEMBER: Hear, hear!

MR. McCLELLAND: That is the problem with the whole

corporation. It could have been a good corporation. It could

have provided a good service for the people of British

Columbia. It could have been competitive, with the private

industry being allowed to stay in business, if it had been

allowed to operate on the same basis. But no, instead it had to

become a political football. That is what went wrong, Mr.

Chairman. We've seen last year.... We see so many mistakes in

the operation of that corporation.

The motor vehicle branch in British Columbia used to have

the best record in North America for its statistical evidence

that it had built up over the years. In about a year, after

ICBC got involved, that whole system was destroyed. The best

system in North America was completely destroyed and

irreparably harmed. It probably will never come back to the

status it enjoyed before.

We know, and it's been admitted, that there were some

400,000 computer errors in ICBC last year. Some 80,000 of those

computer errors are still in the system — haven't been fixed

from last year. Now this year the situation is just as bad or

worse with another, perhaps 300,000, computer errors facing us

for this year alone, right now in those renewals that have been

put forward. How much extra staff has had to be hired to look

after those computer errors alone and to make sure that someday

perhaps those renewals get back into the system so that they

can be a part of the statistical evidence? Without them, you

know, we are talking about a 25 per cent error in establishing

rates for next year, or establishing claims figures. There is

no possible way that you can establish a correct analysis when

25 per cent of your system is out of whack, so anything that we

do next year can't be very meaningful.

We talked, and, Mr. Chairman, I asked some questions here in

the House a while ago. As he always does every time I have

asked that Minister a question, instead of attempting to answer, he mounts a personal attack

on the Member for Langley.

Interjections.

MR. McCLELLAND: That's right. It happened again when I asked

a question about.... This is good stuff, Mr. Chairman. I hope

you are listening in.

AN HON. MEMBER: Wake up!

MR. McCLELLAND: I asked a question about ICBC cancelling

tenant packages under the general insurance rule because of

people being either unmarried or under the age of 30, or both.

I was told that no possible way could that ever happen. Yet I

have a letter here from a man in an insurance agency who

says:

"After sending in a tenant's package application to ICBC, I

received a phone call from Bob Johnson, whom I understand is in

charge of that department, telling me that it was the

corporation's new policy now to accept any single people under

age 30 and that I would be getting a memo to that effect

shortly. He said if he allowed this application to go through,

it would only be cancelled on renewal."

Then I have a couple of other applications here, Mr.

Chairman, which were refused — no real reason given, but the

indication was that both of them were single and living

common-law — "Notice of Cancellation." ICBC has been very

careful not to say what the reasons were, to put those reasons

on paper, but there is no doubt that those were the

reasons.

Then later, April — 14, 1975, a new personal lines

underwriting guide was delivered to all agents, all ICBC

general insurance agents in British Columbia. Most of it is

pretty good — straightforward stuff that you find in any

underwriting guide. Then we get down to the

section which lists

uninsurable risks: "Risks are uninsurable when there exists an

unacceptable degree of moral and/or physical hazard. Moral

hazard arises from those is difficult to define human

characteristics which make an individual honest or dishonest,

ethical or unethical, careful or careless."

The thing goes on to list some other underwriting guides,

but then it says that policies will not be accepted by risks

affected by moral hazards, or which do not evidence a

reasonable standard of maintenance and housekeeping.

Who makes all these decisions, Mr. Chairman? Who decides

whether or not a person is morally bad and the ICBC won't

accept them as risks because they don't evidence a high enough

degree of housekeeping? Who goes in and looks through these

premises before they decide whether or not they are going to

[ Page 4083 ]

allowed as risks for ICBC? Who decides, because a person is

either living common law or is single, is under 30 or perhaps

has a messy house on a Wednesday afternoon...? Who makes that

decision? That Minister stood up and attacked me for being

irresponsible, when all the time that company was operating by

the same guidelines which I said were in effect in this

House.

Mr. Chairman, there is another item with regard to property

taxes paid by ICBC to the various communities in which it

operates. There was an order-in-council approved January 30,

1975, in which it was said that the Insurance Corp. of British

Columbia, in the year 1975, will pay to each and every

municipality in which property of the corporation is situate,

the amount, which the corporation would be liable to pay in

business tax or real property tax to the municipality for 1975.

Why only 1975? Does ICBC plan to get out of that commitment for

1976 and onward? Or will it continue to pay property tax? Why

won't it pay full property taxes, including education tax as

well? It says only real property tax and business tax.

I think there is a myth growing up here again that ICBC is

paying the same kind of property taxes that everybody else in

the community is paying. If this order-in-council is correct,

the ICBC is once again, like so many Crown corporations and so

many departments of government, riding on the backs of the

local taxpayers and causing, in effect, local taxes to go up

for those people who can least afford it.

Interjection.

MR. McCLELLAND: Oh, sure. It's been happening for many

years, through you, Mr. Chairman, to that Minister who

commented. It wasn't right then and it isn't right now.

Interjection.

MR. McCLELLAND: Well, you're no better. You're sitting there

with a smug look on your face, and this government is still

riding on the back of the local taxpayers.

Mr. Chairman, I would like to just briefly mention a few

comments about an unfortunate event that happened a short time

ago with regard to ICBC and the firing of one of the senior

officials, the vice-president of claims for ICBC, Mr. Douglas

Scrivener. I'd like to deal with some of the answers the

Minister gave me at the time we were in this debate. I

recognize, too, that there is a strike on and that the Minister

may have difficulty getting some answers at the present time.

But there have been a number of answers that haven't really

been given, and I still think some answers have been given

incorrectly in this House.

First of all, in relation to the amount of business that was

done by Mr. Scrivener's firm in Saskatchewan, first of all, he

told the press that there were 11 claims handled by Mr.

Scrivener's business. Then the next day he amended that by

saying it was a total of 40 — 11 and 29 — 29 which walked into

the office, I guess, and 11 which were referred by ICBC in

British Columbia. He said that the total amount was $3,000 to

$4,000, and the company's commission would be around $250.

There is evidence that has come to my attention that there

are many more claims than that, but there is difficulty in

separating the number of companies involved because Mr.

Scrivener did sell some companies and some were in Alberta and

some were in Saskatchewan. But the information that was given

to me was that since ICBC began operations there have been, on

the average, some 20 claims a month going to those firms which

bear the name of Scrivener in the prairie provinces, the two

prairie provinces, Alberta and Saskatchewan — as many as 20

claims per month on the average.

Now I don't know what the breakdown is of these companies.

Some of them may have gone to the Calgary companies, which were

sold, and some to Edmonton. But I think it is important that we

know exactly how many of those claims went where and to what

companies.

Mr. Chairman, the $250 commission figure that the Minister

mentioned seems frankly impossible to me, frankly impossible.

Even if it were only 40 claims, Mr. Chairman, I don't see how

it would be humanly possible for the adjusting firm to have

collected only $250. Adjusting firms don't charge commission to

begin with. They charge flat fees.

In Vancouver, for instance, that fee in one major adjusting

firm in Vancouver is $35 per hour. And that includes only the

actual adjustment costs. There's typing on top of that,

mileage, phone calls, letters which are written if they have to

be written; all of those things are charged as individual

items. Anti at $35 per hour for 40 claims, it's pretty unlikely

that the total amount of money that went to that company was

$250.

Interjections.

MR. McCLELLAND: Yes, just like lawyers, that's right.

So, you know, if the Minister can document those figures,

I'd be happy to have them. But they seem highly unlikely to

me.

I appreciate, Mr. Chairman, the Minister's prompt action in

dealing with a conflict of interest situation. I have to say at

this time, after having talked to many people in the industry,

that I am sorry about what happened to Mr. Scrivener, because I

understand he was a very competent person and was he'd in

high

[ Page 4084 ]

regard by all of the people. Yes, unfortunately, he may be

the best person you had at ICBC.

AN HON. MEMBER: And you had him fired.

MR. McCLELLAND: I feel sorry about that, Mr. Chairman, but

there was a conflict of interest situation and the Minister

acted promptly.

HON. MR. STRACHAN: I'm sorry, too.

MR. McCLELLAND: I appreciate that, Mr. Minister.

Nevertheless, there was a conflict of interest situation and I

think it's highly important that we make sure that no other

conflict of interest situation is allowed to happen in any

Crown corporations, regardless of the magnitude of them.

Mr. Chairman, in replying again to me in Hansard the

Minister told me that the preferred list of adjusters for

out-of-province business was compiled for the Insurance Corp.

of British Columbia by the Canadian Independent Adjusters'

Conference around December, 1973, before Autoplan began

operation. Then he also said Mr. Scrivener did not join ICBC

until July 1, 1974, which he has since corrected.

I find that highly unlikely as well, Mr. Chairman. I believe

that that list was prepared in full after Mr. Scrivener joined

ICBC. In fact, it's my information, Mr. Chairman, that Mr.

Scrivener was largely responsible for the preparation of that

list. He had contact with many adjusters with out-of-town

connections at least four months after he started ICBC. The

information I have, Mr. Chairman, is that the Canadian

Independent Adjusters' Conference probably had nothing to do

with the preparation of that list. In fact, there's a real

possibility that the CIAC was most upset with the results of

that list.

I know that there are companies on that list which aren't

members of the Canadian Insurance Adjusters' Conference, and I

find it, not impossible but difficult to accept that that

association would include anyone on the list if they prepared

it who wasn't a member of their association, particularly if

there were members in the provinces involved.

Mr. Chairman, there is a lot of information that Mr.

Scrivener was warned from senior officials at ICBC that

including his own firms on the list would "raise eyebrows," but that Mr. Scrivener replied — and I only have this as

hearsay — that he had cleared the matter with Mr. Bortnick, who

had allegedly told him that he could keep his Saskatchewan

interests. Is that true? If it is, Mr. Chairman, it's very

clear that Mr. Scrivener, to a large degree, has become a

scapegoat for the ineptitude of the management of ICBC.

The Minister has said to the press and Mr. Bortnick has said to the press that

nobody at the top level of ICBC knew that Mr. Scrivener was still involved in

his Saskatchewan firm. That's the most unlikely statement of all because Mr.

Bortnick and Mr. Scrivener had a pre-existing relationship for many years in

Saskatchewan. It was at the insistence of Mr. Bortnick that Mr. Scrivener came

to work for ICBC. For anyone to say, including the Minister, that nobody at

ICBC knew about Mr. Scrivener's continuing interest in his Saskatchewan operations

is the hardest pill to swallow. I'll tell you, Mr. Chairman, that everybody

in business in Vancouver knew — everybody! Yet you say that the top management

at ICBC didn't know. If that's true, if they didn't know, they should all be

fired because they don't know what they are doing and they haven't got their

ears open, Mr. Chairman.

Regardless of the fact that Mr. Scrivener was in a conflict

of interest situation and regardless of the fact that the

Minister acted and acted properly in taking action, I think

still there should be some humanness in the method by which we

get rid of our senior officials. You know, we saw one senior

official in the Education department fired by the Premier on

television.

AN HON. MEMBER: Hear, hear!

MR. McCLELLAND: Mr. Bremer. Now if my information is

correct, and I'm sure the Minister will tell me if. It isn't...but I'm told that on Monday, June 17, the Minister

telephoned Mr. Scrivener at noon. Monday, June 16th? Well,

whatever; it was on the Monday, anyway, the day that the

Minister reported to this House. He telephoned Mr. Scrivener at

noon, told him he had an hour and a half to resign or he'd be

fired at 2 o'clock.

SOME HON. MEMBERS: Oh, oh!

MR. McCLELLAND: Now if that's correct, that's a pretty

shabby way to treat anyone, regardless of the difficulty in

which that person might have found himself. Pretty shabby. If

that's true, Mr. Chairman, I think that even being fired

....

AN HON. MEMBER: He was very competent.

MR. McCLELLAND: Yes, a very competent man and well regarded,

and he made a mistake and then the actions that were taken were

correct. But if that's correct, if the Minister telephoned this

person at noon and said that he's got an hour and a half to

resign or he's out.... That's pretty shabby, pretty shabby,

Mr. Chairman. Unfortunately, it seems to be indicative of the

type of operation that we can expect because of the political

interference in the Insurance Corp. of British Columbia.

I only have one further question, Mr. Chairman — and I

realize here that you may not be able to answer this

immediately — but it has to do with the awarding

[ Page 4085 ]

of adjusting rights, claims rights in the United States. Is

it true that those rights were awarded by ICBC exclusively to

one company called Underwriters Adjustment Co. Ltd., and, if

so, were those rights put out to any kind of tender? How was

that company chosen, and who made that choice? If you can't

answer that question immediately I would accept an answer

later, or whatever.

HON. MR. STRACHAN: Taking the last question first, I would

have to check as to whether or not they've been awarded to one

company. Certainly there was no political interference, and I

had absolutely nothing whatever to do with it. I have no

recollection of even having spoken to Mr. Scrivener personally

on the Monday, none whatsoever.

AN HON. MEMBER: Is that a denial?

HON. MR. STRACHAN: I said I have no recollection of having

spoken to Mr. Scrivener on the Monday.

MR. McCLELLAND: So you didn't? Or you just don't

remember?

HON. MR. STRACHAN: What I told you with regard to the claims

that went to D.A. Scrivener Adjusters Ltd. I think Hansard will

show. I said that that is the information I have received in

reports from Mr. Scrivener.

SOME HON. MEMBERS: Oh, oh!

AN HON. MEMBER: You're the Minister!

HON. MR. STRACHAN: Now I sat and listened to every word and

accusation that Member has made. I ask you to give me the same

privilege.

AN HON. MEMBER: Hang your hat on the evidence of a civil

servant. Attack a civil servant.

HON. MR. STRACHAN: I told you that because of the strike it

would be impossible to check it out and that I would do so as

soon as possible. But Hansard will show I told you that that

was the information I received from Mr. Scrivener's report to

me that I had asked for the previous week.

You mentioned Mr. Margach leaving and the quote in what's

his name's column. Mr. Margach is not leaving until August.

He's leaving under amicable circumstances, and he's given two

months' notice as he is still interested in ICBC

operations.

You made reference to the documents processed. There were 2.5 million documents

processed, and 80,000 documents remaining in error equals about 3 per cent.

Now I want you to remember what an error is in relation to the computer. I'll

bet there are at least six Members of this House who are sitting with a driver's

licence in their pocket that has an erroneous address on it, because they forgot

— there's one right there — to notify the motor vehicle branch that they have

changed their address. So the computer rejects that as an error. That's the

sort of thing that is....

Interjection.

HON. MR. STRACHAN: Is this your office address? I see.

But you see what happens? People forget, even though it says

right on it, to notify the motor vehicle branch of a change of

address. Well, so you don't notify them; so that's the address

to which it's sent. Then that individual does get his

application and he takes it to an agent, and the agent says:

"Do you still live at the address?" The answer is no. Then he's

got to make out an APB-9, which is classified as an error. If a

name is mis-spelled by the individual who's writing it down,

that's an error. Now I hate to go into this because by

inference it's being critical of the agent.

Interjection.

HON. MR. STRACHAN: Well, I'm only trying to describe the

sort of thing that is regarded as an error. So it happens and

we just have to catch up to it manually. But it's this sort of

thing — the transposition of two figures, mis-spelling of a

name, wrong addresses. All that is the sort of thing which, as

I was saying, if you don't notify them, we've no way of

knowing.

MR. H.D. DENT (Skeena): Mr. Chairman, I trust that I also

have the right to speak in this debate.

I was very interested in the comments by the Hon. Member for

Chilliwack (Mr. Schroeder). I have a great deal of respect for

the Member for Chilliwack and I consider him one of my personal

friends. I'm certainly not intending that anything I say is in

any way a personal attack. However, I was just interested in

his desire to put things on a businesslike basis. I would

suggest that if he applied the principle of putting things on a

businesslike basis to other things, it would change our whole

way of doing things somewhat.

For example, maybe we could put the freeway through

Chilliwack on a businesslike basis and have a toll gate at each

end and charge for people to go through, and they could pay for

the cost of the freeway. I don't know if he favours that or

not.

Education: maybe we could turn education entirely back to

private enterprise on a pass-as-you-go basis so that everyone

who received the service would pay for the service and it would

be done on a

[ Page 4086 ]

businesslike basis.

Hunting and fishing: maybe we could charge people for the

game they shoot and the fish they catch and so on. And old-age

pensioners: I think, if we're going to be businesslike, the

old-age pensioners should be working for their old-age

pension.

But I'm also puzzled why he doesn't favour the government

measures to try and put the administration of our natural

resources on a more businesslike basis by charging royalties.

After all, that's the aim — to put it on a businesslike basis,

to assume that the resources belong to the people of the

province and that they are going to be sold to those who wish

to develop them. Yet he opposes that measure, apparently.

Finally, being a man of some experience in the church, I'm

sure he must have read the essay by Stephen Leacock on this

subject. I would certainly commend it to him if he hasn't read

it. If the good Lord was going to put things on a businesslike

basis, he'd be charging us for the air we breath, for the water

we drink, for every benefit that he provides us out of his

bountiful grace. I'm sure he understands the meaning of the

word "grace."

Also, if we ran the church on a businesslike basis we would

charge a fixed fee for burials, marriages, baptisms,

communions, et cetera. Again, it could be done. So I think he

understands the principle. Some things are done in a

businesslike way. Other things are done gratuitously. Some

things are done as a cost to the total population and some are

done at a cost to the people who are users. I can't understand

why he has such a problem about wanting to soak the people in

Powell River and Vancouver Island more money to get back and

forth, I'm really puzzled, and I would ask for his

explanation.

MR. PHILLIPS: Mr. Chairman, there are people in British

Columbia tonight who cannot buy insurance coverage due to the

policies of this Minister here. There are people tonight who

can't buy insurance coverage on their homes. There are truck

drivers who cannot buy insurance coverage. This man has ruined

the insurance industry of British Columbia. When he says that

the people are winning, the people are losing because of the

policies of that Minister over there. He has ruined the

insurance business. People lay in their beds tonight and their

houses are uninsured because of the policies of that

Minister.

MR. P.C. ROLSTON (Dewdney): Smile, you're on candid

camera.

MR. PHILLIPS: Mr. Chairman, this Minister has brought

insurance in this province into utter chaos. I say utter

chaos. Utter chaos because of the policies of this

Minister!

[Mr. Dent in the chair.]

The insurance business is in utter chaos tonight. Mr. Chairman, it's the policies

of this government. The Department of Commercial Transport makes it mandatory,

makes it absolutely mandatory that truck drivers carry flares in their trucks,

and yet they're not able to get insurance coverage. I say that the policies

of this Minister are leading the poor motorist of this province into complete

disrepair. They can't get their vehicles repaired! when they do have them smashed

up, and I say, Mr. Chairman, that people in this province tonight can't get

insurance on their homes, can't get insurance on their vehicles because of the

utter incompetence of that Minister running the Insurance Corp. of British Columbia.

MR. WALLACE: It's a little difficult, Mr. Chairman, to come back to

some kind of rational debate after some of the goings-on tonight. I just want

to say that I understood before supper that if I stopped talking on the Labour

Code, we could debate the Minister of Transport and Communications for about

one hour; and we've been here for two hours and 10 minutes.

MR. CURTIS: And who blew it?

MR. WALLACE: I'm not here to tell who blew it. I'm just here

to say that we're still here. Once more, the kind of so-called

agreements that are supposed to be worked out in this House to

make it function have been a miserable failure all session, and

perhaps on the last night it's sort of typical that this is the

poorest example yet of any attempt to work out a functioning

system in this Legislature.

For that reason anyway, I feel quite justified in breaking

my commitment that I wouldn't take time to discuss the

estimates of the Minister of Transport and Communications.

I am prepared to make the speech I intended to make earlier

on. Don't ask me for cooperation in this House. No, don't ask

me for cooperation. I've had it right up to my cars tonight.

From here on in this House, Mr. Chairman, I'll conduct myself

and the affairs of the party I represent in what I think is a

fair and rational manner. Don't come to me and try to wheedle

me into making deals. That's off from this night onwards.

I just want to talk a little bit about ICBC. We had an

exchange between myself and the Minister last night in which he

talked about false accusations that I had made about ICBC. I

would like to take it from point No. 1.

In my understanding, when you operate a business — I think

Charles Dickens had something to say about this — you have

income and you have expenditures. When your income exceeds your

expenditure by a

[ Page 4087 ]

pound or a dollar or a penny, you have happiness; when your

expenditures exceeded your income by a pound or a dollar or a

penny, you have misery. I don't know that that basic rule of

economics has ever changed in the past one year or 10 years or

100 years.

When you operate an insurance company — whether I operate it,

or Seaboard or the B.C. government — when the operating expense

exceeds the revenue by $34 million, I am not interested in all

the semantics that you can dig out of the dictionary. That to

me represents a financial loss. If I lose money in my business

or in my private affairs, at the end of the year when it comes

to pay the bill I have to borrow money to close that deficit.

Whether you borrow the money from the taxpayers or the investor

or anywhere else, it is not right to say that the accusations

are false when this government has incurred a clear deficit in

the first year of operation of ICBC. I won't bore the House by

going through all the demonstration of the headlines in the

197 campaign of premiums that would be 20 per cent cheaper,

the rip-offs of the private companies and all the other

razzmatazz that we had from this government.

The fact is that ICBC has lost money. When you're in the

red, when your expenditure exceeds your revenue, that gap has

to be met from somewhere, whether it's in a government

situation, a private situation or any other situation.

MR. G.H. ANDERSON (Kamloops): You can carry the debt.

MR. WALLACE: I can hear the Member for Kamloops saying that

you can bury the debt.

MR. G.H. ANDERSON: Carry, not bury.

MR. WALLACE: You carry the debt to next year and sooner or

later there's a day of reckoning. When costs exceed revenues,

putting off the evil day to balance the budget sheet is no

answer. The logical thing to do, Mr. Chairman, is to adjust the

revenues to meet the expenditures. If the Minister is asking

what we would do, we would bite the political bullet and we

would make premiums adjusted to the level which would equate

revenue with expenditures.

On ICBC this government has thrown the meaning of the word

"insurance" right out the window. We no longer have accident

frequency or involvement related to premiums. The only time

that a person pays a penalty for damaging their car or someone

else's car is when they commit an offence. There are all kinds

of car damage incurred which do not involve an offence and

demerit points.

MR. G.H. ANDERSON: That's the way it should be.

MR. WALLACE: Here again we have the Member for Kamloops

saying: "That's the way it should be." In other words the 2 per

cent of individual drivers in this province who previously had

what was called "good driver rating" should subsidize the

person who has one, two or three accidents a year. Is that

justice, Mr. Chairman?

Interjections.

MR. WALLACE: The Member for Kamloops says that the principle

of insurance should not be followed. The principle of insurance

is that you pay a premium according to the kind of risk factor

and the costs that might be involved in meeting that coverage.

I have a driver in Oak Bay who has driven for 40 years without

an accident, and his insurance premium this year has gone up 34

per cent after a 40-year experience of no accidents. I'll say to

you, Mr. Chairman: does that make sense to you? Is that the

reward for being a careful driver for 40 years that you have to

pay 34 per cent more — to put more money in the kitty to pay

for the careless driver who incurs all kinds of expenses to

ICBC. Is that justice? Is that the principle of insurance?

AN HON. MEMBER: How old is he?

MR. WALLACE: I don't know how old the man is, but if he has

been driving for 40 years, presumably he is 56, if he started

driving when he was 16. But I don't really see how much that

has to do with it. Really I think one should judge the whole

principle of insurance against the relative risk related to the

person paying the premium. That is why I am trying to get this

government to look at non-smokers who don't cause fires that

burn down hotels and lose lives.

HON. MR. STRACHAN: Give me a break.

MR. WALLACE: That's what insurance is all about, If the

individual applying for the insurance is less of a risk to the

insurer, this premium should be less.

AN HON. MEMBER: Right on!

AN HON. MEMBER: We've got a points system.

MR. WALLACE: Yes, I've heard about the points system. You

can get points for some pretty simple shortcomings, some simple

little slip of the mind or hand, and you get three points that

cost no damage to the vehicle. You do 40 miles an hour in a

30-mile speed limit, as I did in Richmond not too long ago, and

you get three points.

It doesn't cost ICBC a nickel. But I can bring about

hundreds and hundreds of dollars worth of

[ Page 4088 ]

damage to my car and get no demerit points at all, and my

premium stays the same.

These are some of the points that I think should be aired in

this debate, Mr. Chairman, because under the ICBC system, that

very basic principle that your premium relates to the likely

risk or the record of damage caused, has just gone out the

window.

I have some correspondence here that the Minister has had

with this particular constituent in Oak Bay, and I do feel that

this man has a very valid argument, that if the cost of

insurance is to be related to the risk, his is a very unusual

experience that after a clear driving history of 40 years, he

finds that his premium goes up by 34 per cent.

I want to talk for a few moments about the ferries. The

Minister mentioned the figure of $840 million from tourist

revenue, and I agree with the Minister, that it must be very

difficult to know whether it is $840 or $800 or $900, depending

on the formula used. But in terms specifically of tourist use

of the ferry, I wonder if the Minister could tell me what the

young ladies are doing who stand with a board in their hand and

make notes as you drive off the ferry or tick off a sheet or

take your licence number or whatever.

I had assumed, since they seemed to be looking at the

licence plate of the vehicle driving off the ferry, that they

were trying, perhaps, to determine the B.C. drivers and the

non-B.C. drivers, or the island drivers and the non-island

drivers.

At any rate, I wonder if the Minister could just give us

some breakdown on the actual data which these young ladies are

collecting as you drive off the ferries. I gather maybe the

Minister for Travel Industry (Hon. Mr. Hall) is the responsible

Minister.

The point I am trying to make is that much of the debate

always revolves around the question of whether the person

non-resident in the province should be contributing to the

ferry service costs, perhaps to a greater degree than the

resident of B.C. In the absence of federal subsidy. I wonder if

the Minister could just touch on that, even though I realize

perhaps the Travel Industry Minister is more responsible in

this area.

Another point I'd like to ask is that one of my constituents

has recently become employed as summer help in the ferry

service, and it is my understanding that in terms of safety

training and training to deal with emergencies, there seems to

be no established programme for temporary summer help.

Now it seems to me that it was during the summer one year that we had a Russian

freighter carve its way into the middle of one of our ferries. We had minimal

loss of life on that occasion, but we've already had a debate in this House

last year about the principle of the ferries being so close to land that you

don't really need a lot of lifeboats and a lot of safety drill because within

a very short time all kinds of help would be brought to a ferry in trouble.

I'm not sure that I buy that argument. Regardless of that

particular argument, I wonder if the Minister could tell us

what specific programmes there are in emergency drill and

safety training for temporary help employed on the ferries

during the summer months when there are an increased number of

ferries and an increased number of passengers.

To return to ICBC, there have been press reports that there

has been a considerable amount of suspected fraud, particularly

again in relation to fire, in which motor vehicles appear to

have been catching fire with increasing frequency, leading to

the suspicion that these fires are of course set

deliberately.

I wonder what the statistics are in round figures; I don't

want it down to the last vehicle, but has the Minister got

figures to compare this year with last year, let us say, as to

how many more claims were made for vehicles that are a

write-off because of being completely destroyed by fire?

The Minister has stated that his department is carrying out

some research by deliberately burning old vehicles to try and

find out how fire accidents might be investigated. There are

press reports that already the fraud involved has cost ICBC

many dollars. I don't know to what degree the Minister can pin

down the actual costs, but I think that there is sufficient

concern aroused by the press reports that the public are

wondering to what degree the taxpayer is being taken for many

dollars dishonestly by fires that are deliberately set.

HON. MR. STRACHAN: With regard to comparison of fires this

year compared to last year, of course last year was our first

year of operation. We have just started this year, so we can't

possibly have a comparison. There was a statement made by, I

think, the chief of police in Vancouver and it was in the

press, that last year there were many more fires in automobiles

than there had been the previous year. The indication was some

may have been deliberately set. At the request of the chief of

police, ICBC stopped paying fire claims as rapidly as we had

been. The chief of police said: give us a chance to check them

out before you pay the claim. On that basis, we now don't pay a

fire claim as rapidly as we had been until we get the all-clear

from the police.

I think in every insurance operation, someone finds an

opportunity for fraud. As we develop, we are very conscious of

that fact. We are in the process of finding ways of checking

out on that.

The number of foreign cars that go aboard the ferries —

those girls are employed by the Travel Industry. They only do

that during the summer season. I haven't got those figures with

me.

[ Page 4089 ]

MR. WALLACE: Is that what they are actually doing?

HON. MR. STRACHAN: Of course, they are tourist guides too.

They give tourist advice up on deck in the course of the

voyage. People ask them....

MR. WALLACE: What's the basic reason they are there?

HON. MR. STRACHAN: When they are taking that down, that is

where the car is from. That information is in the hands of the

Minister of Travel Industry (Hon. Mr. Hall) because they are

paid by the Minister of Travel Industry.

With regard to the little ruckus we had last night, you will

recollect we were discussing the leasing of property in

different ways and an inference that ICBC would be leasing

property at a lower rate from....

AN HON. MEMBER: Could be.

HON. MR. STRACHAN: The point was that we have a five-year

lease in our present quarters and we have already announced

that we are going to build our own headquarters in New

Westminster. That was why I perhaps reacted to what I thought

was an accusation that this is what was going to happen. That

was the reason for that.

With regard to the ferries, every ferry carries its full

complement of people with lifeboat certificates. Every ferry

must. No skipper will sail unless that ship has its full

complement of crew with lifeboat certificates. Every person who

is on for summer help is trained on board. Every so often there

is lifeboat drill and so on. Every ferry has its full

complement of crew with full lifeboat certificates.

MR. WALLACE: What about accident ratings? Premiums related

to accident ratings?

HON. MR. STRACHAN: That is under discussion. It is not ruled

out. That is certainly under discussion — a premium related to

the number of accidents in which you are involved.

MR. L.A. WILLIAMS: I just have three brief questions for the

Minister. Four months have not passed since the beginning of

the insurance licensing year, and I wonder if the Minister

would advise the committee as to the reduction in premium

income as a consequence of the reduction in premiums this year

by reason of area differential. That is point No. 1.

Point No. 2. During the course of the debates in connection with British Columbia

Rail, it was made clear to the House that British Columbia Rail's accounting

procedures were being carried out in conformity with the requirements of the

federal agency.

I would like to know whether the Minister can assure the

committee that the auditing of ICBC is also being carried out

in accordance with the requirements of the federal agency which

heretofore concerned itself with the auditing of insurance

companies carrying on business within British Columbia.

Is the Minister able to hear while he's rustling with his

papers? Okay.

My third question. When will the Minister resign as

president of ICBC? When will he depoliticize that Crown

corporation? We have had event after event after event, which

makes it perfectly clear that it is improper, almost indecent,

for a Minister of the Crown to be president of a Crown

corporation. We have had a clear example this evening of why

this Minister should either resign from the cabinet, or from

the presidency of ICBC, or perhaps both.

In connection with the question of the termination of Mr.

Scrivener, it was suggested by the Hon. Member for Langley (Mr.

McClelland) that the Minister had telephoned Mr. Scrivener on

Monday, June 16, and given him one hour in which to resign, and

the Minister got up and said to this committee, he had no

recollection of phoning Mr. Scrivener on Monday, June 16.

Now here we have the Minister responsible for ICBC, the

president of that corporation and the involvement of the firing

on one hour's notice of one of the senior employees of ICBC,

and he says: "I have no recollection."

That's equivocation of the highest degree. Either he recalls

that he did, o