1982 Legislative Session: 4th Session, 32nd 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 )

MONDAY, JULY 26, 1982

Afternoon Sitting

[ Page

8993 ]

CONTENTS

Ministerial statement: government spending guidelines.

Hon. Mr. Curtis –– 8993

Mr. Barrett –– 8994

Routine Proceedings

Oral Questions

Trip to Arizona by Minister of Consumer and Corporate Affairs. Mr. Macdonald –– 8995

Donation of copier to Vancouver Junior League. Mr. Macdonald –– 8996

Mr. Barrett

Expenses of Minister of Consumer and Corporate Affairs. Mr. Macdonald ––

Removal of

section 35 from Tree Farm No. 5. Mrs. Wallace –– 8997

Income Tax Amendment Act (No. 2), 1982 (Bill 74). Second reading. (Hon. Mr. Curtis)

Hon. Mr. Curtis –– 8997

Division –– 8998

Legislative Assembly Allowances And Pension Amendment Act –– 1982 (Bill 73).

Second reading. (Hon. Mr. Wolfe)

Hon. Mr. Wolfe –– 8998

Mr. Howard –– 8998

Hon. Mr. Bennett –– 8998

Mrs. Dailly –– 9000

Hon. Mr. Heinrich –– 9000

Mr. Ritchie –– 9001

Hon. Mrs. Jordan –– 9001

Hon. Mr. Wolfe –– 9001

Legislative Assembly Allowances And Pension Amendment Act –– 1982 (Bill 73).

Committee stage. (Hon. Mr. Wolfe)

Third reading –– 9002

Resource Investment Corporation Amendment Act, 1982 (Bill 67). Second reading. (Hon. Mr. Bennett)

Hon. Mr. Bennett –– 9002

Mr. Cocke –– 9003

Mr. Barber –– 9003

Hon. Mr. Bennett –– 9006

Committee of Supply: Ministry of Health estimates. (Hon. Mi. Nielsen)

On vote 45: minister's office (continued) –– 9007

Mr. Levi

Mrs. Wallace

Mr. Passarell

Mr. Mussallem

Mr. Mitchell

Hon. Mr. Hewitt

Tabling Documents

British Columbia Racing Commission report, 1981.

Hon. Mr. Williams –– 9016

Ministry of Attorney-General. corrections branch annual report, 1981 and 1982.

Hon. Mr. Williams –– 9016

British Columbia Police Commission report. 1981-82.

Hon. Mr. Williams –– 9016

B.C. Marketing Board annual report. 1981.

Hon. Mr. Hewitt –– 9016

Yukon River Basin Committee annual report.

Hon. Mr. Rogers –– 9016

Joint Fraser River Advisory Board annual report.

Hon. Mr. Rogers –– 9016

MONDAY, JULY 26, 1982

The House met at 2 p.m.

Prayers.

MR. BARRETT: I have four guests whom

I would like to introduce today. In the gallery are Mr. and Mrs. Franco

Cuzzetto, prominent residents of Vancouver East and now of Burnaby.

Seated next to them are Mr. and Mrs. Lyle MacWilliam. He is the New

Democratic Party candidate in Okanagan North. I ask the House to

welcome them.

MRS. DAILLY: I would like to introduce

to the House today Bill and Shirley Layman of Colwood, and Shirley's

brother, Mr. Kelly Tanner, who is visiting from Sydney, Nova Scotia.

MR. KING:

In the gallery today, visiting from Salmon Arm, are Mr. Bruce Leggett

and Miss Barb Massey. Along with them are the Soiseth family from

Regina: Len, Pat, Alan and Danny. I would ask the House to join me in

extending them a warm welcome.

MS. SANFORD: From

beautiful Hornby Island, fragile, unique and an island that needs much

protection, I would like to introduce trustees Carol Martin and Bob

Helliwell, and representatives from the ratepayers' organization on the

island: Shelagh Johnston, Kirstin Humphries, Emlen Littell and Robin

Campbell. With them is Bill Brewer, who is the regional board

representative for area A of Comox-Strathcona Regional District,

representing those two islands. They are here today with a number of

other representatives from the various Gulf Islands, and I hope the

House will make them very welcome.

MR. BARBER: Also

here today and concerned about the islands are Yvette Valcourt, a

regional director for the Capital Regional District, Bob Campbell from

Saltspring Island and other persons concerned with the same issue. I ak

the House to make them welcome, and would, if a Page would come

forward, present to the Premier a petition signed by 511, out of a

total of 800, residents of Hornby Island concerned about the

destruction of the Islands Trust. I wonder if you would give this to

the Premier, please.

GOVERNMENT SPENDING GUIDELINES

HON. MR. CURTIS:

Mr. Speaker, I rise to make a ministerial statement. This statement

deals with the increased necessity for restraint in government

expenditures at this point in our fiscal year. As well, sir, I intend

to address certain matters which result from the special report of the

auditor-general of British Columbia, which was presented by you in this

chamber last Friday.

First, with respect to the auditor-general's report, I wish to comment

on three general areas of concern which were identified in that document. First,

there is the test of reasonableness; secondly, the need to have rules which

are not ambiguous; and, thirdly, the need for a capacity to apply those rules

across government. The members of this House are well aware that we have made

very significant progress with respect to improving the financial administration

of the government of British Columbia, particularly in recent months. The most

recent annual report of the auditor-general noted the steps taken since passage

of the Financial Administration Act last year. We're continuing to pursue

the documentation of policies and procedures and the necessary resultant training

of staff. This in itself is a lengthy and complex assignment. but I wish to

inform you and the House that it is this government's position that the

subject is of highest priority

Mr.

Speaker. with respect to the test of what is reasonable, I respectfully

offer the opinion that, given our financial circumstances, expenditures

which some would have previously agreed were reasonable and generally

consistent with normal practice are no longer acceptable. As chairman

of Treasury Board, I announce today certain steps that will be taken

with respect to a variety of expenditures during the balance of this

fiscal year, and which will clearly extend well into the new year,

commencing April 1983. Further policies will be introduced over the

coming days and weeks to expand on these outlined today. Therefore, Mr.

Speaker, they should not be taken in relative isolation.

Policy changes as of August 1, 1982, are as follows:

(1) All first-class air travel is prohibited.

(2) There is to be severely restricted attendance at all meetings and

conferences for which any out-of-province travel is required. As an

example, where under normal conditions a valid case could be made for

attendance at a conference by three or four British Columbia

representatives, we shall now expect the provincial delegation to

consist of not more than one or two persons. In some cases, no

provincial participation will be the order.

(3) No

out-of-province travel will be authorized without the prior approval of

the Minister of Finance, except in cases of urgency. These occur

particularly with respect to officials in the Ministry of

Attorney-General and the Ministry of Human Resources. but there are one

or two others. Requests submitted for approval after the fact will

result in the individual concerned or his or her supervisor being held

personally responsible for those unauthorized out-of-province costs

incurred.

(4) All persons travelling at direct government

expense will be required to take accommodation from a list of approved

hotels where government rates have been negotiated. Where no such rate

is available, the government will indicate specific maximum rates which

will not be exceeded. This, Mr. Speaker, will be in place by September

1, 1982.

(5) All hospitality expenses over $100 must be

approved by the Provincial Secretary and Minister of Government

Services. All such occasions must reflect some special significance for

the province of British Columbia. All expenses for spouses of

government officials in relation to specific government functions must

receive prior approval of the Minister of Finance.

As a

result of the auditor-general's special report, and to implement the

necessary restraint measures described in todays statement, Mr.

Speaker, I have instructed Treasury Board staff to meet with the

comptroller-general immediately in order to produce appropriate changes

in the document which is entitled: "Budget and Administrative Policy,

Chapter 45."

Mr. Speaker, expenditures of a more general nature will also be reduced, again, commencing August 1. 1982.

(1) Offices expenses across government of a discretionary nature are to be

eliminated. Revised expenditure levels with regard to that activity

will be negotiated.

[ Page 8994 ]

(2) Expenditures on office furniture throughout government will be severely

curtailed. Any requests for furniture in offices occupied by ministers,

deputy ministers and assistant deputy ministers will be rejected.

(3) No new passenger vehicles will be purchased by any ministry through the balance of this fiscal year.

(4) Subscriptions to magazines and business, technical and professional

journals are to be carefully examined at the time of subscription

expiry to determine if renewal is absolutely necessary.

Interjection.

MR. SPEAKER: Order, please, hon. members. Ministerial statements are generally heard in silence.

HON. MR. CURTIS:

Mr. Speaker, I hope that member means what he said, because I am very

serious about this. We assume the official opposition is not.

(5) Government-wide, all ministries are directed to examine the number of

telephones in all offices, and all nonessential equipment is to be

removed at the earliest possible moment.

(6) Under the

direction of the Ministry of Universities, Science and Communications

in conjunction with Treasury Board, careful scrutiny will be given to

all long-distance telephone calls to bring about a major saving in toll

charges.

(7) Economies with respect to office rental costs

are to be put into place immediately. These economies will include a

modest reduction of temperature in buildings during cool weather, most

careful monitoring of other energy uses, the immediate identification

of all surplus or underutilized space, and the prohibition of

relocation by ministries to more expensive accommodation.

(8) I expect ministries to impose instant restraint on all acquisition of

computer hardware or related services. Those which are approved must

produce clearly identified net cost savings.

(9) All

nonessential office equipment throughout government is to be identified

within four weeks, and an inventory provided to the purchasing

commission in order that this equipment can be redeployed where its use

is clearly justified.

(10) I request the cooperation of all

secretarial and clerical staff in government to effect immediate

economies in terms of use of stationery and supplies, a reduction in

the use of courier services and an even more efficient use of the

postal service.

Specific instructions relative to all of the

measures just outlined will be transmitted in writing to all ministries

this week. I indicated earlier in this statement, sir, that further

restraint policies will be announced in the very near future. The

measures outlined today represent one additional step in a series of

initiatives to reduce the cost of government. They also represent a

challenge and an opportunity for all ministers, deputies and senior

managers across the provincial government to participate in this

important undertaking.

MR. BARRETT: It is my

understanding, as the minister introduced the statement, that it was in

two forms: one directly related to Mrs. Morrison's report, and the

other to general measures that the minister intends to take for

restraint outside of any reference to Mrs. Morrison's report. I will

answer in kind.

I find the first part of the minister's

statement somewhat incredible. The test of reasonableness of cabinet

ministers' expenditures rests within the integrity of each cabinet

minister. No written rule can come in to tell a minister whether or not

he's taking a holiday, he's working on that holiday or he's working for

the government.

The purpose of the report was to spell out

some discrepancies that unfortunately have become a matter of major

debate, not only here in the House but in the community. The fact is,

sir, that Mrs. Morrison pointed out that a cabinet minister went on a

trip to Arizona with benefit to himself and no benefit to the Crown,

and that has not been addressed in terms of integrity or breaking a

trust as a cabinet minister.

Surely, sir, anybody with one

whit of common sense understands that when one travels on behalf of the

government, there are appointments made ahead of time, there are

appointments and commitments made during that trip, and reports are

given afterwards. But to suggest, sir, that Mrs. Morrison's report

absolves a cabinet minister from being responsible and not making

appointments before a trip, is to excuse and avoid the basic

responsibility and statement of Mrs. Morrison, which she has addressed

herself to for four years in a row, recommending that accountability.

The fact that a cabinet minister still sits in this chamber, in light

of the statement made by the minister, is a condemnation of the whole

government, not just one minister's integrity.

It is not,

sir, without attention of the public that some years ago, because of

these questions, a committee on ethics was promised by the Premier

himself. As a measure of commitment to that committee, it is my

understanding it has never met. So to say that you're going to bring in

these new rules of no first-class travel, to say that you're going to

monitor the behaviour of cabinet ministers, is to admit that each

cabinet minister at this point does not basically understand his or her

own moral responsibility to govern themselves.

Reasonableness

has always been a measure, but that reasonableness has always been the

measure of individual integrity, and it should be applied with an even

hand. I ask you, in response to that: why has the member for North

Vancouver–Capilano been punished for essentially the same

transgressions which are forgiven the second member for Vancouver South

(Hon. Mr. Hyndman) ?

MR. SPEAKER: I interrupt the

Leader of the Opposition to remind him that ministerial statements and

responses thereto are guided by the practice of this House, and I would

just remind the hon. member what it is: each of the statements made by

a minister should be brief, factual and specific. No debate is allowed.

It has further been the practice in this House that a strictly relevant

comment can be made by the Leader of the Opposition, but again no

debate shall take place.

MR. BARRETT: Thank you, Mr.

Speaker. You are quite correct, and I do admit that I strayed. I will

attempt to keep my comments strictly to the minister. However, in

apology to the House, I will say that the behaviour of the ministers

justifies my straying.

Having said that, I want to come onto

the other comment made by the minister concerning the new instructions

to civil servants. Mr. Speaker, I welcome this, but what protection is

there for the Ms. Falles of the civil service who have pointed out

clearly already to their supervisors where they think a

[ Page 8995 ]

transgression

took place? Is there a signal, in these new orders, that civil servants

are now ordered to bring this to the attention of their supervisors?

What happened to Ms. Falle, who did do exactly what the minister has

announced in his new policy? She was treated as a leper.

HON. MR. GARDOM: Order! Order!

MR. BARRETT:

Order, my fig! It's about time you stopped covering up, and had that

man resign, and had some decency come back to this chamber. The Ms.

Falles of the civil service have been told by the minister today that

they must go to their supervisor. What happened to her for going to her

supervisor, other than personal vilification in the corridor by a

minister?

MR. SPEAKER: Order, please. I must caution the Leader of the Opposition — no debate.

MR. BARRETT:

When the minister interrupts, he only inflames the issue. It would be

best that this matter be dealt with, in the light of the condemnation

of that minister, with some sense of history and some hope for the

future. But I tell you that any civil servant who hears the admonition

in that speech today only has to look at the example of what happened

to Ms. Falle and what she got for telling the truth to her supervisor.

Now

we come to the second part, the announcements of restraint: they're not

going to fly first-class anymore. Hallelujah! People have lost their

homes and their jobs, and there's no employment in this province, and

the great sacrifice they're going to make is that they're not going to

travel first-class anymore. Let us hear a great sigh of relief and a

thank-you for that sacrifice on our behalf.

As for the rest

of the measures announced by the minister, we are not bowled over by

them. I will give you one example: the Minister of Labour (Hon. Mr.

Heinrich) has a 69 percent increase in travel expenditures in his

department this year. I want to point out to you, Mr. Speaker, that the

minister has announced today....

MR. SPEAKER: May we have order, please. I must remind the hon. member again that debate is not possible under a ministerial statement.

MR. BARRETT:

Perhaps, Mr. Speaker, if that's the case, we should have a full debate.

Perhaps that would be the answer to it. At a time of distress, to have

the minister get up and make this picayune series of announcements

while people are starving out there and not to permit a debate is

nothing more than a mockery.

I'll go on to the next

suggestion that there be a cutback in furniture. Eighty-one million

dollars worth of votes were proposed in this House by this opposition

to cut furniture and travel expenditures. Who is it that stood up

against those cuts? The government and minister who made the

announcement.

MR. SPEAKER: Order, please. I must remind the Leader of the Opposition that he's straying into debate again.

MR. BARRETT:

This year over $55 million worth of savings in travel, publications and

furniture were proposed. They were all voted against. For the Minister

of Finance to come into the House now and suggest that these

expenditures will not be permitted is to put into question every single

debate that has taken place at this point in the estimates this year

and last year,

To say that the minister's performance is

less than pleasing would be an understatement. To say that his

announcement has corrected the problems would be incorrect. To say that

we should believe in this government in terms of its record on these

issues is almost to make a statement that would be redundant. The

greatest restraint — and I conclude with this — that this government

could show to the people of British Columbia is to take itself out of

office. For God's sake, let them go.

MR. REE: Mr. Speaker. the Leader of the Opposition has a propensity for making mistakes. He did make a reference and allegation....

MR. SPEAKER: Order. please. Hon. member, there is no debate possible

at this moment. I thought perhaps the member was standing to introduce a guest.

MR. REE:

Mr. Speaker, on a point of order. I ask that the Leader of the

Opposition withdraw any allegations of impropriety on my behalf which

he made in his speech. He made comments that the member for North

Vancouver–Capilano had been faced with certain aspects....

MR. SPEAKER:

Order, please. The Chair was not aware of any specific allegation

toward any member, or else I certainly would have interrupted. I would

ask the hon. Leader of the Opposition, if he attributed any inordinate

activity to any member of this House, would he please withdraw it.

MR. BARRETT:

I was asking the same treatment for the member for Vancouver South

(Hon. Mr. Hyndman) that was shown the member for North

Vancouver–Seymour (Mr. Davis).

Oral Questions

MR. SPEAKER:

Before we begin question period and the time begins running. question

periods of the last few days have been difficult to control. and I must

ask hon. members to review the fact that the ordinary rules of debate

do apply in question period. A call for order must meet with

compliance, or else a call for order is simply a contribution to the

noise. Therefore I would remind all hon. members that patience does run

out.

TRIP TO ARIZONA BY MINISTER OF

CONSUMER AND CORPORATE AFFAIRS

MR. MACDONALD: A

question to the Minister of Consumer and Corporate Affairs. The

minister made his reservations for the trip to Scottsdale, Arizona, a

month before he went. Did he make any prior arrangements for business

or political appointments before going?

HON. MR. HYNDMAN: As I have indicated, the answer is no.

[ Page 8996 ]

MR. MACDONALD:

If the purpose of the trip was business and not pleasure, why were no

appointments made prior to going, when you had a whole month to make

those appointments?

HON. MR. HYNDMAN: If the simple

and only test of a trip is whether or not a prior appointment is made,

I suppose one can argue that if one single appointment is arranged, the

entire trip is justified. The test is what one learns in terms of value

to your ministry from your time away. Certainly, in this case, Mr.

Speaker, housing issues at the time were of dominant importance in this

province. This ministry has some considerable responsibility with

respect to several aspects of housing issues. It was my intention to go

to one of the two areas of the United States — Arizona or California —

which were the acknowledged leaders in innovative housing, affordable

housing, and seek out and talk to realtors, developers and home

financiers. That was done, and valuable information was obtained — and

reflected, may I add, in subsequent work in the ministry.

MR. MACDONALD:

Mr. Speaker, the minister said that he went on that trip to meet with

representatives of the state Legislature. I want to ask him, in view of

the fact that the governor's office hadn't heard of the trip and still

hasn't, the leader of the Representatives hasn't, and the leader of the

Senate hasn't: what government people did you meet with, and on what

issues? Who were they?

HON. MR. HYNDMAN: While in

Arizona I most certainly attended a meeting with members of the Arizona

state Legislature. As I recall, there were three or four there. There

were 20 or 25 people in attendance at the meeting. I'd be happy to take

the balance of the question as notice and double-check and provide the

correct names of those who were there.

MR. MACDONALD:

Mr. Speaker, why does the minister, after all these months — and this

has been a matter of public concern — not have the names to give us and

what business was discussed? Surely you answer questions otherwise with

a very good memory. Tell us who those representatives were, what was

discussed with them and where you met.

HON. MR. HYNDMAN:

Mr. Speaker, I'll be happy right now to outline the general nature of

the meeting, but because of that member's abiding interest in the

names, I want to be sure they're correct. I'll be obtaining those,

taking it as notice and finding the particulars. The meeting in

question, as I recall, featured three or four members of the Arizona

state Legislature who spoke on particular topics of their particular

specialty, fielded questions and were subsequently available for

questions in informal discussion.

MR. MACDONALD: Mr.

Speaker, I just want to confirm: did the minister on September 4 and 5

engage a room at the Four Seasons Hotel in Montreal at $440 per night,

chargeable to the public?

HON. MR. HYNDMAN: Mr.

Speaker, the essence of the member's question is incorrect. The dates

would have been approximately September 4 or 5. May I say, with respect

to that entire trip, that because my family was with me and I wanted to

be certain to allocate costs in a fair way and properly distinguish

between those personal to me and my family and those chargeable to

government, I personally paid for all expenses along the way. Whatever

that room rate was — and in Montreal on that Labour Day weekend it was

certainly expensive — it was paid for by me personally. I subsequently,

on my own behalf only, submitted a claim for that which I understood to

be eligible. Again, I'll be happy to take that question as notice and

provide the precise figure to the member. It was certainly less than

$440 a night.

MR. MACDONALD: Well, how much were the

rooms? You've been going over this now for the last couple of months.

How much were the rooms on September 4 and 5?

HON. MR. HYNDMAN:

I've taken that as notice. May I say, with respect to 18 months of

review by the auditor general and a variety of transactions, that I,

computer-like, do not have those particulars at my fingertips. I know

the member is most concerned that the particulars be accurate. I have

therefore taken the question as notice and I shall provide them.

DONATION OF COPIER TO

VANCOUVER JUNIOR LEAGUE

MR. MACDONALD: Does the

minister confirm that for the gift to the Junior League of Vancouver,

which was in the physical shape of a photocopier and later made a

cheque for $5,008, no application had been made by that organization?

HON. MR. HYNDMAN:

Again, as I made public, that presentation at the fiftieth anniversary

of that community organization was a surprise presentation on behalf of

the government of this province to that organization. Hence an

application was not possible.

MR. MACDONALD: Alison

Morse, the league's vice president, confirms that it came as a total

surprise. So my question is: how did the minister know that they needed

a photocopier or that they didn't have funds to provide one themselves?

HON. MR. HYNDMAN:

The member shows a surprising lack of familiarity with an organization,

a very worthwhile one, whose head office and much of whose work is in

Vancouver East. I think anybody at all interested in or familiar with

the Junior League of Vancouver and its many community endeavours, with

a little bit of knowledge and understanding, would know that that

volunteer group works from very modest offices and that one of their

traditional lacks was an office copier.

MR. MACDONALD: Has the minister made any other grants which were a total surprise to the organization?

HON. MR. HYNDMAN:

I don't know what the member's practice was during his time in

government, but certainly the general policy and practice in our

ministry — and I believe it's an accepted one — is that there's a

certain area of discretionary grants and, from time to time with

respect to worthwhile organizations, grants are made. I don't know how,

for example, DERA received its first grant from a

[ Page 8997 ]

certain Vancouver city council of the time. That too may have been a surprise.

MR. MACDONALD: I'd be astonished if they didn't apply for it and then have the thing discussed in council.

Didn't

the minister get the approval of the Premier, after the civil service

had balked at this gift, before the final cheque for $5,088 went out to

the Junior League?

HON. MR. HYNDMAN: There's a very

fundamental error in the supposition on which the member's question is

based. At all material times, I was advised by my senior staff that it

was indeed possible for the ministry to make such a surprise

presentation to the Junior League of Vancouver. At issue was the

correct procedure: whether there could be a direct presentation of the

gift, or alternately, the route of the grant should be used. The route

of the grant was used upon the advice of the senior civil service in my

ministry.

MR. BARRETT: Could the Minister of Finance

inform this House whether or not to his knowledge there is any

procedure for surprise grants to organizations that do not request

anything at all from the government? Is there a procedure for such

surprise grants?

HON. MR. CURTIS: I think the member

would be aware, because it is a matter of public knowledge, that there

are regulations regarding the making of discretionary grants. There is

an upper limit with respect to those grants, and that certainly has

been in place for quite some time. I would think it was in place,

although I'm not certain, during the time of the former administration.

MR. BARRETT: Did the Minister of Finance approve of this grant?

HON. MR. CURTIS:

No, Mr. Speaker. I believe that this particular grant would fall within

the ambit of the discretionary grants authorized at that time to

individual ministers for decision for or against. There is an upper

limit with respect to grants dealt with by individual ministers and

those referred to Treasury Board or Minister of Finance.

MR. MACDONALD: Did the Premier approve the issuance of the cheque for $5,088 from public funds to the Junior League?

HON. MR. BENNETT: Mr. Speaker, that question was asked by that member and answered earlier this session.

MR. MACDONALD: Does the Premier now know the answer, and can he advise the House?

HON. MR. BENNETT: I still remember the answer I gave. If the second member for Vancouver East has forgotten, he can find it in Hansard .

EXPENSES OF MINISTER OF

CONSUMER AND CORPORATE AFFAIRS

MR. MACDONALD: I find questions taken as notice by the Premier in Hansard . But let that be.

The

auditor-general, in her report said of the Minister of Consumer and

Corporate Affairs, with respect to the Arizona trip: "However, it is my

opinion that the amount of time apparently spent on specific issues

would not justify a trip of that duration and cost." Later. with

respect to the Montreal expenses, she said: "The evidence, however,

also suggests the trip was a mixture of business and pleasure. In this

case as well the duration of the trip, eight days, in relation to the

extent of government business transacted, would suggest that a personal

benefit accrued to the minister."

My question to the Premier of British Columbia is: have you decided to ask for the resignation of that minister?

HON. MR. BENNETT: The answer is no.

MR. MACDONALD:

I'll ask the Premier why he is extending differential privileges in

terms of the member for North Vancouver–Seymour (Mr. Davis) and the

damning indictment of the Minister of Consumer and Corporate Affairs

that's contained in the report of the auditor-general. Why don't you

treat people fairly, and uphold the standards of ethics with equal and

fair treatment to all, and justice to the taxpayer?

MR. SPEAKER: Order, please.

HON. MR. BENNETT:

I'm having difficulty taking the question out of that statement by the

second member for Vancouver East. That member should know full well

that this government does treat people fairly on the basis of the facts

as they are, not as the member for Vancouver East politically tries to

see them from time to time.

REMOVAL OF

SECTION 35 FROM TREE FARM NO. 5

MRS. WALLACE:

Mr. Speaker, I have a question for the Minister of Forests regarding

Honeymoon Bay at Lake Cowichan. Has

section 35, which is part of Tree

Farm No. 5, been removed? Alternatively, has a request been made to

have it removed from the tree farm for a purpose other than forestry?

HON. MR. WATERLAND: Not to my knowledge, but I will certainly research the question and bring a definite answer back to the member.

Orders of the Day

HON. MR. GARDOM: Second reading of Bill 74, Mr. Speaker.

INCOME TAX AMENDMENT ACT (NO. 2), 1982

HON. MR. CURTIS:

Mr. Speaker, I wish to say at the outset that I wish it were not

necessary for the government to introduce this particular bill, the

Income Tax Amendment Act (No. 2), 1982.

I indicated at the

time of second reading of the Employment Development Act that it

appeared unlikely we would receive the full cooperation of the federal

government with respect to what we attempted to do in that bill.

Therefore, Mr. Speaker, it is necessary for this Legislature to provide

statutory authority for a provincial tax credit in respect of interest

earned on British Columbia housing and employment development bonds. It

is therefore a companion piece of legislation to Bill 39. which I

believe was passed unanimously on June 16 and received royal assent on

June 25.

[ Page 8998 ]

You

will recall that the government's original intention with respect to

Bill 39 was that the interest on the bonds to be issued under that act

would, by agreement with the federal government, be completely exempt

from both federal and provincial income tax. As I indicated a few

moments ago, that proposal was rejected by the federal government on

the grounds — and I paraphrase — that it would create a distortion in

financial markets and would cost the federal government too much in

lost revenue. Shortly after informing me of his position on this issue,

the federal Minister of Finance, Mr. McEachen, proposed a similar but a

larger, and unfortunately a more complex, scheme of indexed term

deposits. The distorting effects and the revenue loss to both federal

and provincial governments from that plan would be much greater than

under British Columbia's bond proposal. Furthermore, the federal

proposal has the distinct disadvantage of requiring several months of

study at least before it can even be introduced into the Parliament in

Ottawa, and is not likely to provide significant, badly needed

financial assistance for housing and small business until 1983. Our

proposal, in contrast, is simpler, and is ready to go at an earlier

date once the necessary agreements can be concluded.

Despite

these arguments, at this point — late July — the federal government

appears firm in its rejection of the proposed tax exemptions for the

British Columbia housing and employment development bonds. As I've

indicated, I'm therefore required to bring forward this bill to

establish a credit against provincial tax. It is unfortunate that we

are required to adopt this second-best course of action, but federal

intransigence leaves us absolutely no choice. I have asked the federal

government to agree to administer this tax credit, however, under the

federal-provincial tax collection agreement. Last week, Mr. Speaker,

you will recall that I tabled a copy of my letter to the federal

minister, Mr. McEachen, on this subject, and I am awaiting his reply.

The

effect of the tax credit is to refund amounts approximately equivalent

to the provincial tax paid on interest received from the bonds. It has

not been attempted to make an exact refund, because of the complexity

of the calculations which would be required. Again, one of the key

thrusts in this legislation, particularly in the earlier legislation,

was simplicity. It's been decided, therefore, to set the credit for

individuals at a level approximately equal to the marginal provincial

tax rate in the second highest bracket, prior to the application of the

10 percent surtax which exists here.

Contrary to opinions

which have been expressed in this chamber, this flat rate will make the

bonds more attractive to lower- and middle-income investors than would

an exact refunding of actual tax paid. For corporations, the credit is

equal to the general tax rate for both large and small businesses.

Application of the tax credit will allow the issue of bonds bearing

interest at rates of up to four percentage points below general market

levels. This will allow the provision of lower than market rate loans

for housing and employment development projects to stimulate activity

in the province.

In conclusion, while I have indicated that

we have a flat no from the federal government, and while we anticipate

that there will be an approval with respect to the administering of the

provincial tax credit, I am not yet prepared to abandon our efforts

with respect to a federal and provincial tax credit. Contacts continue

between the British Columbia government, the Ministry of Finance and

Ottawa in this regard. I'm sure Mr. Speaker and members on both sides

of the House would agree that in the event that the word from Ottawa

remains no, if we are to proceed with the provincial side of this

program, then this legislation is an essential safeguard.

is second best because of the inexplicable intransigence on the part of

the federal Department of Finance. I very much regret that. I indicated

that in the debate on my estimates last week. I have referred this to

other members of the federal cabinet in Ottawa in the hope that some

reason will prevail.

MR. SPEAKER: The minister closes debate.

HON. MR. CURTIS: Mr. Speaker, I move second reading, noting that there are no other members who wish to speak.

Motion approved unanimously on a division.

Division ordered to be recorded in the Journals of the House.

Bill

74, Income Tax Amendment Act (No. 2), 1982, read a second time and

referred to a Committee of the Whole House for consideration at the

next sitting of the House after today.

HON. MR. GARDOM: I call second reading of Bill 73.

LEGISLATIVE ASSEMBLY ALLOWANCES

AND PENSION AMENDMENT ACT, 1982

HON. MR. WOLFE: Bill

73, the Legislative Assembly Allowances and Pension Amendment Act,

1982, has the effect of rolling back MLAs' 1982 salaries and allowances

by 10 percent effective August 1. This bill rolls back the automatic

11.9 percent increase MLAs received in January and in addition provides

for no adjustment in 1983. This will mean an MLA's salary adjustment

will be reduced to 1.9 percent with no increase in salary or allowances

during 1983.

Fundamentally, this bill reflects the intent of

our province's restraint program during this difficult period and the

leadership we must all show as elected representatives. This new act

replaces an earlier piece of legislation introduced in April of this

year which limited the 1982 increase to 8 percent with an additional 8

percent in 1983. It should also be said that this legislation overrides

last year's amendment to the Legislative Assembly Allowances and

Pension Act which linked the adjustment calculations to the preceding

year's average weekly wage increase in British Columbia.

Once

again, this rolls back the 11.9 percent increase to effectively 1.9 for

1982 and no further increase in 1983. It not only reduces this year's

increase, but provides for no increase next year. I'm asking for all

members of the House to support this very necessary measure, for us all

to show leadership in a time such as this. I move that the bill be read

a second time now.

MR. HOWARD: There's a Latin phrase that could be used to apply to this bill: nemine contradicente.

HON. MR. BENNETT:

Of course I rise to support the bill, but also to stress the point that

the members on the government side intended to make, beyond showing our

own personal restraint, in introducing this bill. The government

members of this chamber wish to make the point that restraint is the

responsibility of everyone. In these days of difficult

[ Page 8999 ]

economic

recession that is worldwide, at a time when people are hurting no

matter what industry they appear to be working in in the private

sector, and at a time when governments around the world are looking to

curtail their spending, which is now beyond the ability of their

taxpayers to finance, then legislators themselves — particularly

governments and a government such as ours.... We have developed an

economic recovery program of which there are two parts, one being the

restraint side on government spending, the other part being economic

assistance to areas that have been hard hit during the recession or

need stimulation that could prove of lasting benefit to the economy or

areas of stimulation and assistance that would meet the needs for

shelter, housing and accommodation of the people of our province and

our country. We feel the government should make a very significant

effort in reducing our own salaries.

Obviously government

members and cabinet have taken a significant reduction of 10 percent in

their salaries. We are doing this to show the people that our reduction

is more than just a token or symbolic gesture. I'm sure all members of

this House will have some difficulty in adjusting their personal

budgets in the coming years because of this major step in reducing our

own income.

This is just the first step in the government's

restraint program. It relates to the state of our economy today. It is

also trying to relate to the national effort which, I hope, will be

joined by all provincial governments, with a sense of national will to

overcome these difficult economic times. It is an opportunity for every

member of the Legislature to now show in a personal way that he is

willing to play a

part in that fight, with a reduction that hurts more

than a little bit.

In the coming days in this assembly

members will be given an opportunity to deal with additional

wide-ranging measures to try to make services which we as legislators

provide affordable within the framework of this economy. As legislators

who have shown leadership by reducing their own income, we will try to

prioritize for people in this province the services that many have

taken for granted as being free because they come from government. As

in the past, many people today are questioning the cost of these

programs because the government can only go back to the taxpayer to

collect the amount. It is a significant change of direction in our

country, coming off an era during which governments have spent more and

more — much of it on many very worthwhile social programs — but it has

priced government beyond the ability of the individual taxpayer and the

economy to pay. It was a time when promises and spending more became

the order of the day; today that is a contributing factor to the state

of the Canadian economy to be able to withstand the international

recession. The recession is hurting every country, but Canada more than

most because of the large cost of government. All members will remember

when the cost of government in this country — federal, provincial and

municipal — was just 20 percent of gross domestic product. Today over

40 percent of all value earned in this country goes to support the

growth of government structure which has taken place during the last 25

years. It's not that it wasn't well intended; it's just that it wasn't

planned within the ability of people to pay. It was apparent that

people wouldn't listen to those who cautioned against the extravagant

promises of some parties and some politicians at election time and

others. Future generations in this country someday will have to pay the

bill so that some members could get themselves elected as government

somewhere sometime.

It's very easy to make promises, to

give, and then get out of government before the cost or affordability

is accountable. Today we see the results of that. We see the new-math

economics of big-government advocates. Now we see growing deficits,

provincial and federal, for current account — not for capital

expenditures, not for job-creation, but for current account. In the

federal government 30 cents out of every tax dollar now goes to service

and pay debt. That has left only 70 cents of the current taxpayer

dollar to provide services. The biggest threat to programs, to

assistance for people, to health care, comes from those who create an

expenditure which at some time becomes unaffordable. with no regard for

the future. Thus services to them will be reduced, at the same time

that their taxes will have to be increased to pay for the excesses of

the past. They will be paying off the debt.

This is easily

understood by people who do not receive their income from government as

legislators, who do not become part of the spending syndrome but have

to live within balanced budgets in their homes. They know something

about debt. They know they can borrow to buy a house. They know that

will give them some equity in something of continuing value. They know

they can do that with goods and transportation that provide a

continuing value. They also know they can't borrow for things that are

consumed at the time, like groceries and other products; that in fact

they would be giving themselves a financial hole in creating such a

burden, the ultimate being bankruptcy in which they would lose

everything. The average homeowner, the ordinary person in this

province, understands that. The only ones that haven't understood it,

of course, have been governments.

The severity of the

restraint program that must be imposed upon legislators, and upon our

province and country as a whole, is more severe than would have been

necessary had there been some restraint in the growth of government,

some responsibility in the management of government, over the past 30

years. We in the British Columbia Legislature are taking, on this

government's initiative, a major step, and I hope that more than just

government members.... I've been assured that members of the opposition

will pass it unanimously. This measure will provide some leadership as

part of a major program of living within our means. That goes for

government, for municipal government and provincial institutions, and

it certainly goes for legislators.

I hope members of this

Legislative Assembly will give more than a passing vote to this

legislation today. I think it provides an ideal opportunity for members

to support, and to give their reasons for supporting, this measure as

part of a broader fight to restore economic confidence and

responsibility. I hope this bill will not pass without at least some

measure of a broader commitment than just what will be taken for

tokenism: that if members don't speak on this important issue as part

of a broader reason, they then don't view it, with the same degree of

sincerity, as a commitment to a much larger fight than merely cutting

our salaries. I hope members of this assembly do take very seriously

the economic recession and the difficulties that people are in. I hope

they don't look on this salary cut, as some people do, as providing a

charitable donation from time to time; that now their consciences are

clean and they don't have to worry about the problems or solve the

problems of individual citizens. It's a problem that isn't going to go

away, and it can't be bought off by just taking a salary cut ourselves.

A lot of work has to go into restoring, our economy. and there are some very painful decisions to be made in priorizing

[ Page 9000 ]

what

services the economy can afford. When you talk about cutting government

expenditure in a meaningful and major way, the minor items are very

important because they all add up in the type of economy that we have.

The Finance minister of the country has announced that the Canadian

economy will shrink by 2.2 percent. All governments are wrestling with

the problems of financing existing programs, even those programs they

have developed. We will have to make some hard choices in the next

months as to whether some programs, desirable as they might be, can

continue. Therefore this major salary reduction of 10 percent for

legislators, cabinet ministers and the Premier is just one step and one

effort in a much broader fight. This legislation, this move, is the

cornerstone of a much broader economic program, and I believe it will

bring great benefit to the people of this province in the long term. It

will be difficult, after years of accepting the excesses of government,

for people to get used to the more reasoned level of services within

their budget. But believe me, no responsible legislator or government

during this period in our history could continue to promise the same or

more when the average person knows that the economy can't afford it.

They can't afford it, and now the legislators are making their move in

contributing to this effort.

Mr. Speaker, I support this

legislation very strongly. This government considers this legislation a

major part of our restraint program.

MRS. DAILLY: I

just want to reinforce what was said by the member for Skeena (Mr.

Howard), that the official opposition will be supporting this

legislation. But after listening to the Premier's statement, I just

want to make it quite clear that we do not endorse his Reaganomics.

We've just been exposed to a lecture on Reaganomics, and I think all of

us just have to look at what's happened in the United States. We want

to say right here and now that we support this bill, but we completely

dissociate ourselves from the remarks of the Premier, who is showing to

all of us that he has no answers, unfortunately, for the problems that

we face today.

HON. MR. HEINRICH: I rise, like I hope all other members will, in support of this bill.

Interestingly enough, this weekend we found a small editorial in the Vancouver Sun . As I recall, it was about....

MR. KING: Read the one above it!

HON. MR. HEINRICH:

The most important one on that page was a very small article, and what

it was, really, was a compliment to government for providing leadership

by taking a genuine reduction in pay. The Premier is quite correct when

he talks about restraint everywhere. When we talk about the unemployed

people outside, I'd say that we are rather comfortable as members of

the Legislative Assembly. We have our jobs, just like those who are in

the civil service, and job security for a period of time. The civil

service may have job security for a much longer period of time, but we

have the benefits that are there. We have all of those benefits which

are in....

I note some of the settlements which have

recently come across. There has been a substantial reduction. The

horizons have been somewhat limited, even in the recent settlement

involving Lornex Mining; at the bottom end of the rung it was little

better than 3 percent. It seems to me that's a demonstration by those

in the private sector, who are acknowledging that we are in difficult

recessionary times. What's the alternative? For those in the private

sector we know what the alternative is; it's a layoff. Surely if we are

going to ask people, starting in here, to take a reduction, I don't see

anything unusual.... As a matter of fact, it's something which should

certainly be done. We've got job security. Those in the civil service

have job security; they know what the alternatives are.

also know what the cutbacks in industry are, and those who are excluded

from the bargaining units in large operations have been taking cutbacks

of 10 percent — in some cases much more. Interestingly, there was a

recent poll conducted by Gallup across the country, where an

exorbitantly high percentage of people were quite prepared to take a

reduction in order to preserve their jobs. That was the most important

thing to them, and I think a lot of it is now coming through; we in

Canada have been living beyond our means.

The Premier of

British Columbia led the way with the original introduction of the

restraint program many months ago, and now it's beginning to be

followed by a number of other governments. The figure which is most

alarming of all.... One of the things that has always intrigued me

of the gross national product. When we absorb in excess of 40 percent,

we are then heading in the direction of the socialist governments which

have administered Britain for so long.

MR. LEA: Gross national or gross domestic?

HON. MR. HEINRICH: Either way.

MR. LEA: It can't be either way.

HON. MR. HEINRICH: There was a recent

article in a magazine that I doubt very many, if any, of the, members opposite would read. It's called Forbes .

I recognize that sometimes it's been branded as being a little bit on

the right, but periodically they have some excellent articles. There

was a superb

article in there by Fernand Braudel, who is a French

materialist economist. One of the greatest things he's always said is

to point out that — and it's a lesson that we can all always learn, and

those who deny it aren't really levelling with themselves — we are

constantly making promises that can't be fulfilled and leaving others

to answer for them at a later date. The answer sometimes is to say no

and mean it.

There's another item which we should consider,

and that is the delivery of social programs within British Columbia. I

don't think any of us want to see anyone suffer at all, never mind

unduly, with respect to the delivery of programs which we have. We must

do all we can to preserve them. If this small effort on our part as

legislators, taking a reduction of 10 percent and suffering some of the

pain.... I'm sure that some, if not all, of those within here will

suffer some pain, and maybe we ought to experience what it is and what

those who are laid off and not providing payment to the government

through corporate taxes or personal income tax.... It's time that we

did experience a little bit of that pain. It's very easy to turn around

and expect others to, but it's always best when it comes home. At least

we cannot be faulted when all legislators are prepared to reduce

expenditures in programs.

[ Page 9001 ]

might also say that this particular reduction is felt by all ministries

and is also used as a guideline, I am sure, by those of us responsible

for administering our own respective portfolios and the reductions that

we're all going to experience as time goes on. I certainly support the

bill and compliment the Provincial Secretary for introducing the bill

today.

In conclusion, I think it's probably the start of our

economic plan for recovery. It is starting right where it belongs,

within this chamber.

MR. RITCHIE: I, too, am proud to

take my place very briefly to make a few comments in respect to this

salary reduction that we are being asked to take. The greatest threat

that can be made to any of our programs can be the cost of government,

and we've been seeing it happen, particularly in Ottawa. I have been

saying for many years that one of the greatest threats to our hospital

or health programs has to be the uncontrolled cost of running

government. The greatest injustice that we could do to those people who

require health care or to our senior citizens is to do little, if

anything, to control the cost of government. The greatest injustice we

can do to our educational system is to go ahead and keep spending, as

the socialist party of this province has already demonstrated they

would do if they were in power.

However, this is a bill that

is welcomed by all of us, I think, in that it gives us an opportunity

to show to the private sector that we are prepared to take less and

work harder in order to assist everyone to come through this economic

recession that we're in at this moment. When I think of all the

unemployed out there and those who are threatened with unemployment, I

know that they would very much like to have any kind of a job, any

salary at all, just to keep things going at home. Of course, we have

those who are in business, small businessmen who are threatened with

bankruptcy, and those who have already come through it. They would be

very envious indeed — and I'm sure are — of those of us who can retain

our jobs, even with a reduced salary. I am, indeed, in full support of

this bill. I hope that it is the type of indication that is required in

the private sector, and I hope that those who are still employed will

see that this is an opportunity to join with us and share and assist in

keeping as many people as possible employed in our province. I fully

support this bill for a salary reduction.

HON. MRS. JORDAN:

Mr. Speaker, I don't intend to prolong the debate, but I feel that as a

member of this Legislature I should add my few words. The first I'd

like to say, of course, is that I support the bill, albeit, like the

rest of the private sector and many people in Canada who are going to

have to face and are facing the situation, it would be nicer for us to

have it another way. We're no different from anyone else.

It's

recognized that, being in the public service, there are added burdens

for MLAs, and it's also recognized that those MLAs who represent

non-metropolitan areas have an increasingly difficult burden because of

the size of their constituencies and the need to help those people who

are far from the seat of government have a close link with their

government. They often suffer the frustration of trying to win their

way through the established procedures, as well as often having to

incur more costs — whether at the government level or in the private

sector — when they want to speak to their government.

[Mr. Davidson in the chair.]

Nonetheless I think that

members of our party feel that it's important that we as legislators

not do what is perhaps sometimes done in other jurisdictions: talk

restraint for everyone else but not be willing to practise it

ourselves. I believe that it's important that at this most crucial time

in Canada's development, even here in British Columbia. where we're

probably better off than anywhere else in Canada.... Due to the

administrative expertise of this particular government and the

confidence that it has been able to gain from the private sector, even

in these difficult times we have been able to proceed with major

developments in the province which will certainly help — if not

ultimately, in a short time — improve our circumstances financially, as

opposed to other parts of Canada, where they have little to look

forward to. We practise the type of leadership that is required.

I would like to quote the Times-Colonist

editorial today, which says in one section: "In the past federal and

provincial politicians have been ready to preach restraint but

noticeably reluctant to act on that advice by setting an example." The

Premier has said, in talking about the economic situation in British

Columbia and the strategy to meet those difficulties, that he wants to

be as fair as possible. and that all of us have an opportunity to put

our shoulder to the wheel and to undertake this. It's been asked of

other people. As has been mentioned before, the cruellest form of

restraint is put on the private sector, and all of us represent areas

and people in the province who perhaps have not been able to see their

company survive these difficult times, who perhaps have lost their job,

who are involving themselves in time-sharing and work-sharing and other

positive programs.

Perhaps the most important question that

should be asked right now, Mr. Speaker, is where the opposition stands

publicly in terms of putting their positive position forward in

encouraging all of the public to put their shoulder to the wheel; where

they, as members of this Legislature, stand in terms of their

willingness as individuals to continue serving their constituents, to

continue to strengthen that link with government for those people out

there, and to help them with their problems, at the same time taking

part in an exercise that affects their own pocketbooks. I would

encourage the members of the opposition not only to speak positively,

within the province, as we all must do, about the things that we can do

and are done to better the economic future in British Columbia, but

also to share with us this willingness to show leadership, to feel some

pain, and to be encouraging and positive to the public through our

attitude.

HON. MR. WOLFE: Mr. Speaker, in closing

debate on this bill I just want to say that I'm pleased to see the

indication by all members of unanimity in support of this bill. I think

what I should also make clear, though, is that although the bill is

entitled Legislative Assembly Allowances and Pension Amendment Act, and

a lot of people might just think that's in terms of reducing the pay

and allowances of MLAs. It also includes, of course. those special

allowances paid to other people who perform for the Legislature: the

special salaries of ministers, the Speaker (Hon. Mr. Schroeder), the

Leader of the Opposition, and the Deputy Speaker (Mr. Davidson). In

other words, it covers many other salaries in addition to those paid

specifically to MLAs. Just as a quick calculation, the direct saving

from reduced salaries of ministers, the Premier and others plus MLAs is

approximately $350,000 in one

[ Page 9002 ]

year.

But I think the significant thing is the fact that it is the

cornerstone in showing leadership, as has been indicated in the House

earlier, in terms of the restraint measures which are very necessary. I

think we should appreciate that this salary rollback of 10 percent does

cover a lot more than simply members in the Legislature; it covers all

of these special salaries paid to other categories of government.

I say, I'm pleased to see that there's an indication of unanimous

support. I appreciate the remarks of the Premier made earlier this

afternoon on this matter, and I'm just disappointed that the NDP, in

supporting this bill, sort of say: "Yes, but we don't support the

restraint program." Isn't it typical for them to say: "Yes, but"? They

are the "yes, but" party of British Columbia. "We'd like to go along

with this restraint measure, but we don't support the government's

restraint program." That's what they're saying. Instead of supporting

the restraint program they stand up here and make these flimflam

amendments to minister's votes all through this sitting of the

Legislature. Without any research or study they throw up figures here

which government can reduce, hold up charts. I call those flimflam

amendments.

I know the House is going to support this

measure. It's the leadership where it needs to be shown. The saving is

not represented specifically in the reductions to the members and

ministers, but in the impact that that will have in very necessary

other measures that this government needs to adopt. I support this

measure and move the bill be read a second time.

MR. LEA:

I rise under standing order 42 to correct something that the minister

said, because he didn't do it to an individual but to a group — us.

HON. MR. WOLFE: Yes, but.

MR. LEA: No "but" to it. The minister lied.

DEPUTY SPEAKER: Order, please. The member now taking his place

on a point of order — it had not been determined that it was in fact a point

of order — knows very well that the remark that he just made is one that must

be withdrawn.

MR. LEA: I do withdraw it.

DEPUTY SPEAKER:

Further, I would caution hon. members that the Chair is becoming

increasingly concerned with the number of members who are using that

term in this House, then having used the term simply get up and make a

withdrawal. I will advise members in this House that when I am sitting

in the chair, the next member who calls another member of this house a

liar will not only be ordered to apologize, but will be removed from

the chamber for the remainder of that sitting. Hon. members, this

matter has been one of very grave concern to the Chair, and a simple

withdrawal by a member after making that statement no longer can be

tolerated. I am sure that upon reflection all members, having been duly

advised, will see that that particular move by the Chair is more than

equitable and, in fact, long overdue.

The member's point of order.

MR. LEA: The minister, while summing up the principle of this bill, quoted our caucus incorrectly, and so I stand under rule 42.

DEPUTY SPEAKER:

Order, please. Hon. members, we have on numerous occasions discussed

what can and cannot be done under standing order 42. Simply to say what

the member has just said does not qualify under standing order 42.

Firstly, the member was not quoted directly; and secondly, differences

of opinion do not qualify under standing order 42, or we would be using

the Chair ad infinitum to discuss matters upon which sides of this

House differ.

MR. LEA: I didn't raise it as a difference of opinion. I expressed it properly the first time, which I withdrew.

Motion approved.

HON. MR. WOLFE: I ask leave to refer the bill to a Committee of the Whole House to be considered now.

Leave granted.

Bill

73, Legislative Assembly Allowances and Pension Amendment Act, 1982,

read a second time and referred to a Committee of the Whole House for

consideration forthwith.

LEGISLATIVE ASSEMBLY ALLOWANCES

AND PENSION AMENDMENT ACT, 1982

The House in committee on Bill 73; Mr. Richmond in the chair.

Sections 1 and 2 approved.

Title approved.

HON. MR. WOLFE: Mr. Chairman, I move the committee rise and report the bill complete without amendment.

Motion approved.

The House resumed; Mr. Davidson in the chair.

Bill

73, Legislative Assembly Allowances and Pension Amendment Act, 1982,

reported complete without amendment, read a third time and passed.

HON. MR. GARDOM: I call second reading of Bill 67, Mr. Speaker.

RESOURCE INVESTMENT CORPORATION

AMENDMENT ACT, 1982

HON. MR. BENNETT:

This amendment removes the restrictions on ownership by Canadians that

were contained in the original bill. It will make trading and ownership

of shares in British Columbia Resources Investment Corporation the same

as for any other private sector company operating in British Columbia

or Canada. With the maturity of three years, and with those who have

speculated probably being out of shares, and the shares being in mature

hands, it is felt that this restriction is no longer needed, and that

the company can take its place on a full and equal basis with other

private sector companies.

I move second reading of the bill.

[ Page 9003 ]

MR. COCKE:

We have a spokesperson with respect to this particular bill. I gather

he's gathering up his reams and reams of notes. However, I would like

to remind the Premier of a number of lessons that the people of British

Columbia have learned with respect to the whole BCRIC fiasco. The

Premier said to the people of B.C.: "We're going to teach you how the

system works." He sure taught the people of British Columbia how the

system works. First, taking from all the people what they already owned

and either "privatizing" or "semi-privatizing" it, and promising them

that it would be great riches for all.... Now he's decided to do what

he promised never to do: widen the opportunity for control. Yes, the

Premier has given marvellous lessons to all the people of British

Columbia about how the system works.

MR. BARBER: I rise as the designated speaker in this debate.

The

only good feature about this bill is that it has led to a temporary

improvement in the value of BCRIC shares. That's a good thing. Everyone

welcomes it: we do, the shareholders do, and the investment community

does as well. This is the one good feature, but, unfortunately, as of

today it appears to be temporary. In Toronto at 2 o'clock only 41,800

shares have been traded, and it closed down at $3.30. In Vancouver

47,400 were traded, and it closed down at $3.35. It appears to have

been a temporary blip. It does not appear that that temporary increase

in value will be sustained much longer.

This bill

represents, with stunning clarity, the lack of conviction and lack of

principle on the part of the government which introduced it. The lack

of conviction and lack of principle is easy enough to demonstrate when

you read Hansard of June 14, 1979. At that time the Premier

introduced an amendment to the resources corporation legislation, which

created a 1 percent shareholder's limit. We supported that particular

provision. We did so then and we do so now, because it protects the

interest of small shareholders. The lack of conviction, the lack of

sincerity, the lack of political integrity that we witness today is

provable when you read the comments of the Premier on June 14, 1979. He

said:

Mr. Speaker, the 1 percent is there to protect the people. It was in the legislation

passed in 1977 — and the fact that people must be Canadian citizens. It is not

the intent in this

section to allow government to increase that, but rather,

should the situation warrant it, decrease it as a further protection.

that time the Premier made an argument which we accepted and the public

applauded. That argument was that BCRIC should not be subject to

takeovers by large corporations. The insincerity, the lack of political

integrity, is now manifest for all to see.

If you need further evidence, on June 27, 1979, the Premier said:

There is a 1 percent limit on ownership in the company, and it

is not anyone's intention to increase it. It is there as the protection.

It means that if the final accounting was 95 million shares, 1 percent would

be 950,000 shares. Now 20,000 of that is far less than 1 percent; it is infinitesimal.

went on to say during the same debate, again referring to the 1 percent

rule: "This is so nobody, through association, can defeat the 1

percent. This is a safeguard against a number of people getting just

under 1 percent."

The Premier then made an argument which

today he destroyed. The argument he made then was more credible than

the one he advanced today. The argument he made then was that if BCRIC

should exist at all, it has to exist as the special conservator of its

assets and the special trustee of its possibilities. The 1 percent rule

was one of the best features about BCRIC. It guaranteed that large

capital and large corporations, singly or in combination, could not

take over this company, and could not thereby unfairly and unreasonably

manipulate its share value, manipulate its transactions, acquisitions

and other programs for capital development and reallocation. What the

Premier did today was make a fool of himself. What the Premier did

today was make a fool of all his colleagues who voted for this original

protection just a few short years ago.

What

the Premier did

today was admit that British Columbia is for sale, Mr. Speaker. A

couple of years ago he attempted to block the sale of MacMillan Bloedel

to a certain back-east financial interest. He did so. He said that B.C.

was not for sale, and many people applauded him. When he introduced the

1 percent feature of the BCRIC legislation, people applauded that too —

that includes me then and it includes me today. If BCRIC need exist at

all, then it needs to exist with special protection, so that Dome

Petroleum, Canadian Pacific Industries, the MacMillan Bloedels and the

Bell Telephones of this world cannot get their hands on it.

would remind you, Mr. Speaker. that at one time all of the assets of

BCRIC belonged to all of the people. Regrettably, the government

introduced that legislation and abandoned that high principle. BCRIC is

now owned by some of the people. Shortly, Mr. Speaker, it will be

effectively controlled by just a few of the people. That is the tragedy

of this legislation today.

What the Premier said in his

speeches in 1979 was worthwhile, good and true. What he said today is

foolish, stupid and regrettable. What lie said in 1979 is that BCRIC

required the 1 percent protection in order to guarantee the future of

the company and keep it free from corporate domination. What he said

today was: "Anything goes. We don't care. Big companies are welcome to

come in." BCRIC is for sale and so is British Columbia. It may well be

that Social Credit knows that it is not going to be returned at the

next provincial election. On that basis, apparently, they are now

prepared to open the gates and allow anyone to get anything. That goes

for farmland and government grants, and it now goes for BCRIC.

It's

perfectly clear that this new legislation may well be part of the whole

package contemplated on behalf of Dome Petroleum, which is, as everyone

knows, in somewhat difficult financial circumstances. Dome likely

couldn't borrow $5 million on the open commercial market tomorrow.

BCRIC, however, could. Although BCRIC is today $714 million in debt,

its assets are fundamentally sound; its assets are fundamentally

worthwhile and will not deteriorate. BCRIC has had very serious

problems with political interference. It has had very serious problems

with its prior management. Nonetheless, the fundamental body of assets

which was turned over by BCRIC, and which were earlier acquired by the

first New Democrat administration, is basically sound and more than

adequate to the purpose of allowing BCRIC to succeed. BCRIC should

succeed; BCRIC needs to succeed; BCRIC should be doing a job for its

shareholders; and, with any luck, it will be able to turn a profit,

issue a dividend and contribute to the economy of this province.

Although

we voted against BCRIC in the first place as a matter of principle — we

believe that all of the people should own those assets, and not just

some — now that it's here we

[ Page 9004 ]

want

it to succeed. One of the ways that it could have succeeded was by

guaranteeing that it remained, as the Premier himself said in a speech

he repudiated today, a daring experiment in people's capitalism. He

defended the 1 percent rule by saying that this was a means of

guaranteeing that all of the people had an equal say, and that none of

them could get together on any basis whatever, collaboratively,

conspiratorally or by accident, to take over the company and run it for

the single interest of one single economic force. The Premier said that

this noble experiment in people's capitalism would be defended by the 1

percent rule. That's what he said three years ago. What does he say

today? Implicitly, he says that British Columbia is for sale and BCRIC

is for sale, each of them to the highest bidder. The Premier's speech

in 1979 made a lot of sense. Those remarks, that defence, those

qualities of protection and that special circumstance for BCRIC were

admirable then. They remain admirable now. The Premier's speech today

is a disgrace. It is an admission that his so-called experiment in

people's capitalism has failed, at least from his point of view. It is

an admission that Social Credit is in serious political difficulty

because of the serious financial difficulties in which BCRIC has found

itself, insofar as trading value goes on the shares. And it is an

admission of one more colossal blunder on the part of the Premier of

British Columbia, who does head, after all, the single most incompetent

administration this province has ever seen.

I won't bore

you, Mr. Speaker, with my usual recitation of all the disasters in

administration for which the Socreds are responsible — headed, as

always, by the Ministry of Deregulation, the Princess Marguerite and

the heroin treatment program — but I will remind you that the most

incompetent government this province has ever seen — namely, Social

Credit — did acquire assets now being changed in their execution and

ownership by this bill, which, when acquired by the first New Democrat

administration, were worth a lot, sufficiently so that when four

stockbroking houses put together the initial prospectus, they said that

the opening paper value of BCRIC shares was $11.16. That's what Austin

Taylor said. He is a notorious Socred bagman and behind-the-scenes

financier in this province. Austin Taylor and three other stockbrokers,

through their houses, prepared a report which evaluated the assets

turned over to BCRIC. On the basis of that initial valuation the shares

were held to be worth $11.16. That, of course, could only be tested by

the market when they actually went on sale. Only then would you know if

that was considered a low, a high or an accurate valuation.

[Mr. Speaker in the chair.]

But

the Premier never gave BCRIC a chance. From the beginning this Premier

meddled in BCRIC. Instead of allowing the market to assign the value

and allowing the prospectus to remain an authentic document,

representing the best possible anticipation of the share value.... Let

me remind you, Mr. Speaker, that $11.16 was the prospectus statement of

the value of these shares. Instead of allowing the free market to do

the job it does better than any other market in the world, the Premier

interfered and meddled politically. What did he do? He artificially

devalued BCRIC shares and put them on sale at six bucks each. In the

short run that was politically profitable; in the long run it was

stupid, it was a mistake of extraordinary proportions, and it has led

to the bill we're debating here today. They started at $11.16. The

Premier devalued them for political purposes, to $6. Today they are

trading in Toronto at $3.30 and in Vancouver at $3.35. They have

reached as low as $2.38. The Premier appointed the first board of

directors — the ones blamed for this mess. The Premier appointed Mr.

Helliwell, the man blamed for this earlier mess. The Premier appointed

the people who blew it, and he appointed the executive director who

blew it. This is popular opinion, and it's well regarded within the

investment community as well.

Odlum Brown is a respected

trading house in Vancouver. It is a respected agency of private

capital, and it does a good job representing the people it is hired to

represent. Its president is Tony Hepburn. Mr. Hepburn said in the Vancouver Province

of July 23 that the abandonment of the 1 percent rule will open BCRIC's

door to effective control by large corporate shareholders and could

eventually lead to a takeover. Mr. Hepburn said he was "completely

surprised" by Bennett's decision to remove the restrictions entirely,

rather than imposing a higher limit such as 5 or 10 percent. He went on

to indicate that opening the door to corporate takeover made it

perfectly obvious what the Premier's agenda was. He said: "I view the

move certainly as an acknowledgement the experiment has failed." Well,

it has failed because the Premier made it fail; it has failed because

the Premier came in today and said: "I don't like this experiment any

more; I don't like this exercise in real people's capitalism. I'm going

to change the rules." By so doing he has once again politically

interfered and meddled with the marketplace of British Columbia; once

again he has tampered with the value of BCRIC shares. It's temporarily

positive, but in the long run, no doubt, negative. In the case of

BCRIC, people fear more than anything else political intervention by

that Premier, and once again he has demonstrated where his real agenda

lies. It does not lie in that field occupied by the small shareholder,

by the small and ordinary citizen of British Columbia, who actually

took him seriously when he advised three years ago: "Go out, buy a

piece of the rock and make a bundle of money." A lot of people went

out, bought a piece of the rock and lost a bundle of money because of

the number one stock promoter in the province, the Premier, telling

them to do so. As far as BCRIC goes, most people have spent money, paid

interest and lost money ever since. Anyone who took the advice of this

incompetent Premier seriously has done nothing but pay for it ever

since.

In the past people have been willing to put up with

the fact that they've lost money because of the incompetence of Social

Credit and the management team they initially appointed. They're

willing to accept the fact that Social Credit has cost them a lot of

money, because they could always rationalize that, nonetheless, they

remained in control of the company, because, you see, the same Premier

who told them to go out and make a quick bundle on BCRIC also told them

that they would be protected by the 1 percent rule. Well, regrettably

they have made no money at all; they've done nothing but lose their

shirts. Now, even more regrettably, not only have they lost money but

they are losing control.

A company as widely held as BCRIC —

122,000 registered shareholders, approximately 1,872,500 persons

holding bearer shares — becomes an easy target for takeover. In a

company where everyone has 5, 50 or 500 shares, and not many more, it's

obviously no great effort to put together a portfolio of half a million

shares and thereby control the company. That's always the danger that

any ordinary company faces in the marketplace: takeovers when that

company

[ Page 9005 ]

very widely held. The protection against that was the 1 percent rule,

and that was adequate protection. Today the Premier has abandoned that

protection, has abandoned those shareholders, has abandoned that

prerogative, and has said that anything goes.

In a moment of

rare candour for this Premier he admitted to the press last week that

BCRIC was now, at least theoretically, subject to corporate takeovers.

Well, it's more than theory, Mr. Speaker; obviously some people are

already lining up their interests, and they started to do so last week.

In one day more than 400,000 shares were traded, and this is ten times

the BCRIC average — 15 times on some days. Some people already believe

that they should now move into a position to take control of this

company. In whose interest is it, Mr. Speaker, to have the 1 percent

rule abandoned? I think it's clearly in the interests of those

companies operating in competitive fields. BCRIC has assets in

forestry, in mining — especially coal-mining — and in petroleum and

natural gas rights and leases. Those are the three fundamental

resources that the company owns. It has, of course, shares in Westcoast

Transmission and so on. It has an interest in the Brae area of the

North Sea oilfields, but basically it is in the field of forestry,

mining, coal, and natural gas and petroleum rights and leases in the

northeastern part of this province.

When you examine the

basis of BCRIC's ownership of natural resources, it tends to suggest

who else might be interested in taking over BCRIC. A company that, for

instance, Mr. Speaker, was interested in assuming control over the

operations of southeast coal, because it was itself already in the

import-export business, because it was itself already in or had in the

past been in the coal business, or because it wanted to get into it in

order to make it consistent with its other operations; one thinks, for

instance of Fording Coal, owned by Canadian Pacific. Obviously, smart

business people realize that if they can work a deal with BCRIC to

combine the technologies, the facilities and the working capital of

their company with that of BCRIC in a similar field that they're

already in — for instance, coal — then they would be well advised to do

so.

Now the problem with that is that BCRIC's interest may

end up taking second place and the interest of the company that

intervenes might take first place — and that's a danger for us. Edgar

Kaiser, for instance, already had a major interest in southeast coal,

and he sold out to BCRIC. He got a very good price for it, but if Mr.

Kaiser decided he wanted to come back in, for the first time, courtesy

of the Premier, who has now made this big present to big business, he

could come back in and assume effective control of BCRIC. Remember, Mr.

Speaker, it's a very widely held company, and someone with just a few

more shares than the average guy can end up controlling the operations

of that corporation. It's obviously in the potential interest of

Canadian capital to realize what BCRIC's assets are in the fields of

coal, natural gas, petroleum, and forestry, and to find a way to make

the development of those resources coincident with theirs, thus

reducing costs and making greater profit. It may well be in the

interest of some major coal company to take over BCRIC in order to

control the development of southeast coal. It is not necessarily in our

interests that that be allowed.

Today, this Premier has made

it possible. That's a tragedy for resource development in British

Columbia. The best guarantee we ever had that BCRIC could do anything

was the 1 percent rule. That kept BCRIC relatively accountable to its

shareholders. Shareholders have been somewhat ignored in the past.

BCRIC shareholders have felt somewhat alienated at the annual nicetinos

in the last three years. In the future they will be ignored

altogether when Dome or Fording or whoever it might be — and I simply

hypothesize; whichever company or set of companies — decide it

might be in their interest to assume effective control of a company

whose assets are such as BCRIC has. This will, I think, result in a

very considerable loss for us in terms of the self-governing

administration of those resources.

In 1979, the Premier said

that if he changed the level he would only change it downward, and if

he were to give any consideration at all, it would be to decrease the

allowable limit. I'd like to know which corporation got to the Premier

in the last few weeks and persuaded him, with whatever advice or help

they might have offered, that that rule should be changed, the speech

repudiated, the principle abandoned and this bill introduced. Who got to

the Premier of British Columbia? We know that it wasn't the board of

directors of BCRIC; they didn't request this. We know it wasn't Mr.

Howe, the chief executive officer, nor Mr. Watson, the president of the

board. The Premier has given no information or advice and in answer to

my question no comment at all on whether or not the shareholders

requested it.

Were you here in question period that day? I was. I know what he said. What

he made perfectly clear was that he was not responding to any request, formal

or otherwise, from the British Columbia Resources Investment Corp. If they didn't

get to him, who did? If the small shareholders, who have been protected

by the 1 percent rule, didn't persuade the Premier to abandon that protection

they have enjoyed, then which big shareholders in the future got to the Premier

of British Columbia, and how did they do it? What rational or political arguments

did they make? What other considerations were there? We will tell you in the

days and weeks to come.

The

speech made in 1979 is proven today to have been a speech of hypocrisy

and disregard for principle. The speech made in 1979 has made the

Premier look a fool this afternoon. It was an admirable statement of

the need to protect small shareholders. The speech made today was a

contemptible abandonment of those shareholders and a contemptible

willingness to sell out to large corporations who may want to take over

BCRIC. because they can do it now.

Who got to the Premier of

British Columbia? How did they persuade him? What arguments did they

offer? What help did they provide'? The Premier has never talked about

that. I asked in question period, and he made it perfectly clear that

it did not come from the official, or even the informal, mechanism of

the Resources Corp. itself. Apparently it came from his own imagination

or that of Mr. Heal or Mr. Kinsella or whomever. Apparently it came

from big business as well, because it's obvious that they would have an

interest in this. If the Premier is going to go to such an extreme as

to make a fool of himself by repudiating his own speech, his own policy

and his own vote in the House and introduce a bill like this after what

he said in 1979, then obviously there must be a very great reward in it

somewhere.

The reward clearly will not be of benefit to the

individual shareholders. They will continue to pay interest on their

overdrawn bank accounts and on the notes they borrowed and signed

because the number one stock promoter, the tout from South Okanagan,

told them to buy BCRIC shares. They were always comforted and protected

by the fact that their company would be immune to takeover. Today there

is not such

[ Page 9006 ]

comfort

or immunity. All we have it this Premier repudiating himself and

abandoning altogether the commitment to principle he made in 1979.

The

only good feature of this bill is that, as everyone expected, there has

been a temporary increase in the value of BCRIC shares. It went down a

bit today. I have no idea what it closed at in Vancouver at 3 o'clock

today. It went down a bit today, compared to last week. Nonetheless,

there is some small improvement, and that's good. It's obvious where

the action is coming from. It's coming from big companies and big

shareholders positioning themselves to take over if they wish and can

make it coincident with the interests of their own companies.

Otherwise, there's no reason why people should be investing. Unless

people think there's a quick profit by virtue of a takeover, there's no

reason for them to invest in BCRIC. If they weren't interested in a

takeover, they could have bought the shares before at a lower price.

The only reason anyone would pay a higher price, as they have in the

last few days, is in order to position themselves for a takeover. Logic

and rationality can have it no other way. If all they wanted was 1

percent, they would have bought the 1 percent at the lower price long

ago.

Obviously we will not support the bill. Obviously we

will not support the hypocrisy of a government that would say what it

did with such fanfare in 1979, that would turn around and eat crow,

that would turn around and abandon principle as cynically, callously,

negligently and sadly as the Premier has today. It's really a shame

that this Premier continues to meddle in BCRIC. It is a shame that he

did what he did when BCRIC started, and got it off to such a difficult

beginning, through the much criticized board of directors and much

criticized chief executive officer whom he personally appointed in the

first place. It is understandable why, prior to the next election, the

Premier wants to do whatever he can to manipulate the stock value. To

the extent that it goes up, at least that is some small comfort to the

people who may take immediate benefit from it. But as

an act of

principle, what he's done today is reprehensible. As

an act of

community principle in this province, whereby small shareholders who

used to be protected by the 1 percent rule no longer are, what he and

his government have done today is reprehensible. It should be an

embarrassment to them. With any luck, it will continue to contribute to

all those other things that will lead to their defeat in the next

provincial election.

HON. MR. BENNETT: In closing the

debate, let me just assure the first member for Victoria that once

again his flights of fancy have gone far beyond reality. There is no

major lobby group that has come to the government to change its mind on

this issue, or anyone mysteriously in the wings who has requested the

government to make this amendment. Let me very strongly assure him of

that. In assessing what has happened to BCRIC in three years, and

looking to the best interests of the small shareholder, the government

has removed the restrictions.... From looking at what has happened to

the bid-ask price of those shares since the announcement, they have

been restricted from the type of value the market would place on them.

arguing that we keep the restrictions, the member is arguing against

the price increase in the shares. I will take every opportunity to tell

the people who own BCRIC shares that the first member for Victoria is

against this move that would increase the value of their shares by

freeing them and making them subject to the same regulations and

restrictions that apply to other Canadian companies. What that member

wanted was restrictions that would keep the price depressed. Do you

know why? Because he thinks he can get elected again if the price

stays down. He doesn't care about the shareholders of BCRIC; he cares

about the future of Charlie Barber. He's not concerned whether they

have increased value. He's trying to keep his job. I recognize that I

should not have referred to a member by name — the first member for

Victoria.

It's very clear that this move has been beneficial

to all the shareholders. For him to suggest that somebody could take

the shares away shows his lack of understanding of business, finance

and economics. The fact that he's proud he doesn't own any shares in

BCRIC indicates that he has very little interest in being involved,

except in a political way when it's convenient for him and his party to

attack it. That is what they did a few years ago, to the detriment of

the little shareholders. They speak against measures today which would

allow those shareholders to receive higher value, and after the market

has established a higher price for those people, they argue in favour

of retaining those restrictions which would be detrimental to the

little shareholder of BCRIC. Nobody can take their shares away from

them and they don't have to sell them, just as the member for Victoria

didn't have to buy them or receive them. He made his choice. He made

his judgment of that company on a political basis long ago. He has

spoken time and again to try to justify his judgment, oft-times to the

detriment of the little people who have shares in that corporation.

giggles and laughs, Mr. Speaker, and I'd like to have that on the

record. His approach from day one has been not only to exhibit a lack

of understanding of market factors, but particularly his wish to

receive some political benefit somehow in the future if it fails, or

doesn't meet expectations. We've heard statements in the past on what

is now, and has been for three years, a private-sector corporation, a

corporation that has been under political attack. Not an economic

attack, which is the normal fortune of a company, but a political

attack has been waged strictly to enhance the election possibilities

for New Democrat members in this province. It has nothing to do with

the operation of BCRIC, nothing to do with helping the shareholders. In

fact, an attack carried out on a political basis has hurt them. Today

we hear the final conclusive proof that the shareholders needed after

the market responded to our move on behalf of the little shareholders

of BCRIC. Having responded in a positive way and increased the value of

their holdings, the first member for Victoria has come out of the

closet and let them know that he doesn't want that value to stay up; he

wants it to fall. That's why he's opposing the measure that we propose

in this amendment.

Mr. Speaker, I'm going to have difficulty

telling the people of British Columbia what took place today, but I'll

have to, because I want them to continue having confidence. If at some

future date, next year or the year after, the first member for

Victoria, with his record of meeting payrolls and running businesses,

becomes the Finance minister in some New Democratic Party government,

they know what to expect from him. They know the measures he will take,

and they know full well what will happen to the value of their shares.

They have been forewarned this afternoon, and forewarned is forearmed.

Never let that member for Victoria, and never again let that party,

again under the cloak of looking after the little shareholders, ever

lull them into believing that

[ Page 9007 ]

they're

sincere and looking beyond their own political fortunes. Today the

member for Victoria has come out of the closet on this particular item.

He's told the shareholders that he is willing to oppose this measure

which the markets show has increased the price of their shares. He's

against it; he wants the shares to fall in value.

Mr. Speaker, I now move second reading.

Bill

67, Resource Investment Corporation Amendment Act, 1982, read a second

time and referred to a Committee of the Whole House for consideration

at the next sitting of the House after today.

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

ESTIMATES: MINISTRY OF HEALTH

(continued)

On vote 45: minister's office. $222,410.

MR. LEVI:

I ask the forgiveness of the member for Shuswap-Revelstoke (Mr. King),

for preempting his speech. I want to ask the minister four questions

on four items that I'd like him to comment on. Last year I had

discussions with some of his officials about the government's policy

for dealing with drug addicts, particularly the methadone program. In

February 1982 I wrote to Dr. John H. Smith, who is connected with the

Alcohol and Drug Commission, asking him for the commission's policy

with respect to the use of methadone. Mr. Smith wrote to me on May 17

and I'll quote some salient parts of the letter.

"The

Alcohol and Drug Commission has found methadone maintenance to be a

particularly difficult policy issue. There are very strong arguments

both for and against the use of this drug. While there is no question

that maintenance can be a very beneficial program for some individuals,

we have also become aware that strong pressure can be exerted by others

to be put on maintenance when it is difficult to justify and less

desirable than having the person accept a withdrawal.

"You may also be aware that the quality of illicitly

available narcotics has declined. The use of methadone, a potently

addictive narcotic, has to be evaluated in relation to the fact that

most current narcotic users do not have the level of physical

dependence that was common in the sixties and early seventies.

"This letter is not to

suggest that we have made a decision against methadone maintenance, but

only to indicate some of the difficult issues involved."

did write to the medical association, which has passed a resolution in

favour of the use of methadone as a treatment mode for heroin addicts.

I'd like to know the decisions of the ministry in respect to the

methadone program.

My next question to the minister relates to the legalization of heroin for

terminally ill patients. The minister is probably aware that on July 16, 1981,

Monique Bégin, the federal minister, announced that she was putting together

a committee to look at recommendations to the government respecting the use

of heroin for terminally ill patients. On that day she had received a submission

from Dr. Walker and some people from southern Ontario containing 15,000 signatures.

I would like to hear from the minister what the position is of the B.C. government.

The use of heroin for medical purposes has been banned in this country since

1955, following a ban by the World Health Organization on the manufacture and

importation of heroin into various countries. Very quickly, in 1955 the Canadian

government imposed its own ban.

1973, I was in Switzerland. At that time we had set up the Alcohol and

Drug Commission and were looking again at alternate modes for dealing

with addicts. I went to Geneva and met with the international narcotic

control people to discuss the question of treatment for heroin users.

At that time, one of the officials said to me that the manufacture of

legal heroin was being outstripped by the manufacture of illegal

heroin. As a consequence of the international police attack on heroin

trafficking, the legitimate use of heroin as a painkiller was being

denied to people who were not criminal addicts, but people in pain who

suffered great discomfort.

I think it's rather ironic. It's

a matter of looking at justice in our world when people who abide by the

law and have terminal illnesses are denied what is — from what the

specialists in the field say — by far the best pain-killer which would

give them some relief. I'd like the minister to tell us whether his

ministry will be supporting Ms. Bégin's.... First of all,

the committee is going to be set up and there will be some discussion,

and obviously the provincial ministers will be involved as to what

thou, ht the minister has given this question.

The third one I'd like to ask the minister is whether the government has made any decision or formal reaction.... I

guess it's a little early. You got a brief from the health

professionals on July 14, 1982. It's a little early in the game; I

hadn't realized it only so recently came. It was originally raised with

me by the dieticians, that they wanted to look at some form of

regulation. I'm not going to get into that, because we can't discuss

legislation here. I just wonder whether they have prepared a response

to the brief that was given to the government in July 1982. It's on the

health occupations legislation, a position paper prepared for the

government of British Columbia by the B.C. health professionals'

legislative committee.

I have another question I'd like the

minister to answer. It's to do with Erhard Seminars Training. better

known as EST. I'm glad the minister wrinkles his brow, because I

wrinkle my brow when I realize what EST stands for. About a year ago

there was a serious problem in the ministry in respect to the services

delivered to children. I understand that EST — as the minister may know

— is a belief system that is commercialized. The Erhard Seminars

Training is described as an evangelistic profit-making organization that

aims to transform the world by transforming individuals and

institutions. Last year. according to the very excellent study done by

Stephen Hume in the Colonist , the corporation collected something

like $24.2 million in revenues.

As I understand it, the

ministry undertook to do a report. If I'm not mistaken, Dr, Peter

Ransford headed the inquiry group. The issue that was before the

ministry and to some extent before the public.... We need an answer

from the minister on this. There's a unit in Victoria. called the

integrated services for children and family development, which operates

on Cook Street; it's been there a number of years. It turns out that

people whose children were receiving treatment from that unit were

being required to take the EST courses. I'm not commenting on the EST

course itself, but if nothing else. I would say that that would

represent something like a deterrent fee imposition on anybody wanting

to have any

[ Page 9008 ]

connection

with the Integrated Services, if that's what they were required to do.

Apparently they were, and also some of the staff were. I'd like to hear

from the minister what has actually happened. Is there a report? If

it's been completed, is he prepared to release it? Because if nothing

is being done, then presumably many of the parents whose children are

receiving treatment at this unit are still having to take the course.

It's not inexpensive; it's $400.

I have one further question

for the minister. I don't know whether he's got any of his

epidemiologists here. I recently met with Dr. Nick Schmitt, who has a

great deal of expertise in the whole problem of the presence of lead.

He's done some studies on the presence of lead — because he was the

health officer in Trail at one time — particularly as it relates to

children. I gather from looking at this and talking to a number of

people that there is still no agreement with the federal and provincial

authorities on the funding of what should be a fairly substantial study

on this matter. There are some studies, but no definitive studies in

Canada. There has been some pushing for quite some time. It may be

something the minister doesn't know about, but I'll write him anyway

about it.

I have raised five matters with the minister, and I'll sit down now.

HON. MR. NIELSEN: On the last one first, if the member for Maillardville-Coquitlam would drop me a line on that then I could respond,

Some

of the questions the member brought forward today, I think, involve a

certain amount of philosophy as much as policy. The medical people in

the ministry and others with whom we've had some contact with respect

to methadone seem to offer both opinions very strongly as to the

continuation of methadone in the treatment of heroin addicts. The

member has repeated information which is freely available from people

involved in that therapy and treatment who offer their very strong

opinion with respect to the dangers of methadone itself, and the value

of methadone as a substitute for heroin. The information about the

quality of the heroin now commonly used by addicts, compared to the

heroin of some years back, is that apparently the quality is very

different today.

In 1978 policy was established by the

government to continue with a program of methadone maintenance for

those who were on the program. The policy established back in 1978 was

not to accept new clients into the program. Some of the treatment

services since that time have focused on a drug-free approach to drug

dependence aimed toward elimination of drug use. That's where I think,

as well as policy, some of those responsible in the program develop

some philosophy with respect to what the best treatment might be.

Many

of the people responsible prefer the drug-free approach over methadone

maintenance, which they claim attempts to manage the addiction by

providing a substitute drug. There is a lot of opinion with respect to

the desirability of continuing the program as it was for so many years.

There seem to be two very strong schools of thought. Presently we are

continuing with the policy established in 1978, to continue maintenance

of those who are on methadone, but not to encourage new clients into

the program.

It's being reconsidered, although it's not a

new program. The policy established in 1978 is being reconsidered, or

perhaps just considered, as to its desirability as a therapy for

narcotics addicts. No decision has been made yet. The matter was

referred to the Alcohol and Drug Commission, who have completed a

review, but no decision has been made on a modification of the policy

which has been in place for a number of years with respect to the

methadone program.

I might mention that we receive very

little information with respect to that. When we do, it seems to come

in waves. For a period of time there seems to be an interest in it, and

then it drops off once again. It seldom comes to our attention as it

once did. So the program will remain as is for the time being, subject

to the report from the Alcohol and Drug Commission to see if they are

making any new recommendations.

On the legalization of

heroin for terminally ill patients, I suppose history repeats itself

frequently. At one time, as the member would be aware, heroin was used

for that purpose. The federal Minister of Health and Welfare, Monique

Bégin, made a statement of some kind recently with respect to looking

into the question of the advisability and legal complications of

administering heroin to terminally ill patients. The provincial

government has not decided on this matter. I don't believe that at this

time we have yet been asked to take

part in the committee, but I'm sure

we will. If any province should be asked to take

part in anything

relative to heroin, it should be British Columbia. We certainly would

join in that committee.

Mr. Member, I think your earlier remarks touched on something very important:

that is, the question of heroin with respect to any value as a pain reliever.

It certainly has been overshadowed in modern times by the criminal element associated

with the drug. If there is value in heroin for medicinal purposes, particularly

for those who are terminally ill, then it's certainly been widely ignored

for a long time because of the shadow of crime. We'll look into it, along

with the federal government. We take no prejudice into such discussions or examination.

It could have some interesting legal implications. Since it would come under

the Criminal Code of Canada and some of the specific federal statutes, I'm

sure they would offer their input. We will, with no hesitation, take our place

in such discussions without a prejudiced approach to it. I really don't

know if we'll be supporting the federal initiative, because I don't

think the federal initiative has been crystallized at this time, but we certainly

will watch.

The question on health occupations legislation.... The

member mentioned one organization, I believe, who sent in a brief

earlier this month. We are constantly in receipt of positions from

health professionals who all have basically the same desire, and that

is to have a statute devoted to their profession, just as we have for

some other professions within the province. There seem to be a number

of arguments from the associations as to the need for a statute. It is

suggested in many of these discussions that much of what they seek is

available to them now under the Society Act, were they to incorporate

as a society. The weakness which they identify — and I think

examination would agree — is that the society concept is voluntary, and

any person who would be subject to its regulations or rules would do so

in a voluntary way. These organizations who are involved in the health

world appear to want something more definitive and mandatory with

respect to regulations. The concern we have, not just with us in

British Columbia and not just in health, but in many provinces and in

many professional areas, is whether such legislation would restrict the

capacity of individuals to practise in certain fields of endeavour or

whether it would be necessary first for them to be accepted by one of

these organizations which has its own statute and to be approved,

[ Page 9009 ]

effect, just as we have for members of the bar or for medical

practitioners in the province, who have to have membership in an

organization first; whether we would be expanding that type of

requirement for individuals, and how many of these groups, which

operate now without statute, if legitimized — for want of a better term

— would then split into sub-organizations which would want the

independence that they have today and then perhaps later come back to

look for their own legislation.

I believe the province of

Quebec has been addressing this problem for some years, and I believe

it's the province of Quebec which has experimented with what they refer

to as umbrella legislation. The umbrella legislation approach would,

rather than bring about an individual statute for an organization,

produce a statute which would give government the authority to grant

certain controls to organizations in various fields to run their

business as they determine it should be run, but we have not yet come

to that same conclusion. We in the Ministry of Health and, I believe,

in the Attorney-General's ministry and in others that are under similar

lobbying by groups and organizations to raise their own statute have

not yet come to a conclusion which seems to satisfy all. So at this

time we're not putting forward any legislation.

The specific

brief referred to by the member is not familiar to me at the moment. I

may have seen it; I'm not quite sure, but we will be responding to

them. I think the paper has been received by the ministry and is being

considered at the moment.

It's a tough problem right now as

to whether we wish to encourage more and more organizations to have

their own statute or whether it would be preferable to have some type

of umbrella statute which would give us the authority to provide most

of what they seek.

Mr. Chairman, on the EST review, we had

quite a study on this after statements had been made and reports

issued. We appointed a review committee about six months ago to

determine whether staff hiring or promotion at Integrated Services was

conditional implicitly or explicitly on an association with EST. We

also wanted to determine whether clients of Integrated Services

received either treatment based on EST or recommendations to enrol in

EST courses. We also asked the review to assess the impact or influence

of EST upon Integrated Services and whether such influence or impact

would be appropriate for a government agency. We also asked them to

make recommendations as to whether a comprehensive review of Integrated

Services, as it is now and as it may be, should be carried out. The

review has been completed and the committee's report has been submitted.

The

people within the Ministry of Health have been reviewing this report.

Among some of the information received so far, the review of Integrated

Services by the ministry found that hiring a full-time staff was not

conditional on association with EST and that no instances were

substantiated of staff members recommending EST as therapy, although it

may have been recommended in a very few cases to adults as educational

experience. There are no facts to support the contention that the

directions of integrated services changed because of EST influences. A

comprehensive review of Integrated Services' long-term goals and

objectives should be carried out because of its relationship to new

facilities and its providing children's services in the Capital

Regional District. The staff at Integrated Services have been told that

discussions relating to personal-growth movements must be limited to

staff's personal time and dissociated from Integrated Services. A

comprehensive review of Integrated Services to establish its long-term

goals is under review, and those objectives will soon be identified.

Mr.

Chairman, EST or other programs which are made available, whether

they're personal-growth programs or whatever else, seem to find their

way into our system frequently. On occasion prominent people are openly

identified with them. The investigation we had into Integrated

Services indicated to us that this EST did not seem to have the

influence that some people feared at that time. As well, I understand

there's an action underway with respect to some of the statements which

were made. However, that will not involve the Ministry of Health. It

is, rather, an independent action that is being conducted. The report

that we received, as I said earlier, indicated that, in the eyes of the

investigators, this EST concept was not a dominant factor in that

particular service. I've heard basically nothing since that report was

prepared. So either it's functioning much better now, or no one is

overly concerned. I can send the member, even though it would be

available in the transcript of Hansard , the

summary in point details for his own perusal.

MR. LEVI: I have two suggestions for the minister. One

relates to the.... When he talked about the idea of umbrella

legislation for various professional groups, we did have one experience

here. about four years ago, when the Psychologists Act came in and we

had quite a debate. I, personally, do not favour that kind of umbrella

legislation for this reason: if people were encouraged to obtain the

legislation via the private bills committee, what you give is an

opportunity for there to be hearings, and all of the people who have

some kind of vested interest, or are opposed, can be heard. We have no

procedure at the moment in the Legislature. We have no committee

system. except the private bills committee, which would allow us to

have such a hearing, and that's always very useful. Some years ago we

dealt with accountants, and we had a number of accountants'

organizations come forward to object to a particular group; at least

we had the hearings. It seemed to me that in terms of professional

groups applying for legislation, that's a worthwhile way of going. You

get people who make representations and give you the very real

arguments. the hard arguments, the practical and professional ones, as

to why they object or support a particular group. That's a very

worthwhile exercise. I can well recall that when we did the

Psychologists Act, had it not been for the fact that in this House at

the time there were about five or six people who worked in the area of

counselling, we would not have been able to debate this from a

professional point of view. But it sometimes happens that when you

don't have people with any professional interest in that particular

group, you're not going to get that kind of debate; what you're going

to get is a lot of unhappy people out there who really have no vehicle,

because it comes in as a government bill. So I strongly suggest to the

minister that we might look at the private bills committee as a

vehicle. If necessary, let the committee sit when the House is not

sitting. But let's use the committee system. which would give people an

opportunity to have a hearing and make submissions. It's much more

desirable than umbrella legislation.

The other observation I have to make is

that, while I know it's a little early for the government to make

submissions about the legalization of heroin for terminally ill people,

I would point out to the minister that there are 37 countries in

[ Page

9010 ]

the world today that are using heroin for medical treatment in a

very legal way. I realize that we are part of the various international

protocols relating to the control and importation of heroin. Some of

this, of course, grew out of the World Health Organization's position

and some from the International Narcotic Control's position.

Nevertheless,

I would think that the government does not have to wait for an

invitation. We are constantly reminded, daily almost, in the press and

media of the number of people who are in treatment for cancer or dying

from cancer. The debate is very much on, even to the extent that we've

now gotten to the debate of the idea of the right to die and all of

those concepts. It seems to me that the ministry might very well use

this opportunity, but how or through what vehicle.... I don't want you

to set up a bureaucracy to do it, but it might be very worthwhile to

have a small committee that would receive submissions.

terms of the medical profession, that can be done internally, because

that's a professional judgment. But there are a lot of people who are

not doctors involved in the whole area of hospices, grief counselling

and a variety of other services, that are now attendant to people who

have terminal illnesses. Then, of course, there's the whole question of

pain. The reason I raised this question initially is because I find it

quite horrible, in this day and age, that we have denied it to

law-abiding people who have had an incredibly difficult time with the

illness they've had, simply because we've been concentrating on trying

to control international heroin trafficking. As a result, that

particular medication has been deprived.

I know that you

juggle two major issues there, but there's no question that other

countries have now made this move. Apparently it's medically desirable.

Certainly if 37 countries, including Great Britain, are doing it, there

are some very good grounds. It might be worthwhile for the minister to

engage the ministry in a kind of public dialogue. It's worthwhile. You

need that kind of support.

I don't want to get into an

emotional harangue about this thing. Nevertheless there is a sufficient

body of medical opinion around — some in British Columbia, the rest in

Canada and internationally — that will argue in a very firm way for the

objectives of the committee that.... That's something the minister

might look at in terms of dealing with that particular question. I

think the public should be involved in that particular one.

I'll be in touch with the minister on the matter of the lead levels in children and that kind of situation.