2016 Legislative Session: Fifth Session, 40th Parliament

HANSARD

The following electronic version is for informational purposes only.

The printed version remains the official version.

official report of

Debates of the Legislative Assembly

(hansard)

Thursday, February 25, 2016

Afternoon Sitting

Volume 33, Number

ISSN 0709-1281 (Print)

ISSN 1499-2175 (Online)

CONTENTS

Page

Orders of the Day

Second Reading of Bills

Bill 10 — Budget Measures Implementation Act, 2016

Hon. M. de Jong

C. James

D. Barnett

B. Ralston

G. Kyllo

A. Dix

Hon. S. Thomson

D. Eby

Hon. T. Stone

M. Farnworth

Hon. T. Lake

B. Routley

H. Bains

Proceedings in the Douglas Fir Room

Committee of Supply

Estimates: Ministry of Environment

Hon. M. Polak

G. Heyman

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THURSDAY, FEBRUARY 25, 2016

The House met at 1:32 p.m.

[Madame Speaker in the chair.]

Orders of the Day

Hon. M. de Jong: It’s estimates season again. In Committee A, we will begin with the estimates of the Ministry of Environment. In this chamber, it is second reading on Bill 10.

[R. Lee in the chair.]

Second Reading of Bills

BILL 10 — BUDGET MEASURES

IMPLEMENTATION ACT, 2016

Hon. M. de Jong: I move that Bill 10 be read a second time now.

Bill 10 enables a number of social and economic development policy initiatives included in Budget 2016. My reference to them for the purposes of second reading debate will be somewhat detailed in the description of what individually they do or are intended to do, recognizing that we’ve had a fairly general conversation over the last six days about the budget. When we get to committee stage, I’ll have an opportunity, with the official hon. critic and other members of the House, to delve into more detail about individual provisions.

I’ll go through a general description of what is included in the bill as it relates to the budget.

Two parts in Bill 10:

part 1 includes a number of provisions that will enable government’s management of the ’16-17 budget and the three-year fiscal plan, and

part 2 amends six statutes in order to implement many of the tax measures referred to in Budget 2016.

Beginning with

part 1, the Financial Administration Act is amended to create the new B.C. prosperity fund. A new

part in the act creates the fund as a special fund within the consolidated revenue fund.

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It provides for an inaugural $100 million contribution. It defines how new contributions are made and establishes allowable payouts out of the fund, with debt reduction being a first priority while protecting the balance of the fund to serve as an endowment for future generations.

The Budget Transparency and Accountability Act is amended so that the requirement in that act for dealing with increases in government cash or cash equivalents during the fiscal year will actually facilitate the intention of the previous amendment and allow for some or, I suppose, even all of those increases to be transferred to and accumulate in the B.C. prosperity fund.

The Financial Administration Act is also being amended to provide statutory authority for managing costs of negotiated public sector compensation that had not been anticipated in that year’s budget. The best example of that is the recent economic stability dividend. This amendment will allow government to incur these expenses without impacting the ability to fund core services or other emerging priorities in the fiscal year.

The Insurance Corporation Act is amended to provide flexibility in the determination of Insurance Corporation of British Columbia’s annual minimum capital reserve targets for optional insurance so as to help keep basic insurance rates low while protecting government’s fiscal plan objectives. The amendments also change the corporation’s fiscal year-end to March 31 from December 31 to harmonize ICBC’s planning and reporting with that of the government shareholder.

Bill 10 also amends the Wildfire Act to establish statutory appropriations beyond direct fire control. That will include wildfire prevention, wildfire risk reduction and rehabilitation of lands damaged by wildfires. An increased focus on wildfire prevention and risk reduction, we believe, will help keep British Columbians and the communities they live in safer from the threat of wildfire.

The Public Service Benefit Plan Act is amended to transition the former long-term disability trust fund into a new special account. This change will improve transparency of the long-term disability plan, facilitate more certainty on plan funding and assist government with its debt management strategy.

The Emergency Program Act is amended to establish a statutory appropriation for payments and grants made to local communities and organizations for emergency prevention and preparedness initiatives, such as upgrading dikes and flood protection in vulnerable communities. Investments made to support and protect our communities will help, we believe, mitigate the impact and cost of future emergencies and natural disasters.

The proposed amendment to

section 9.4 of the Special Accounts Appropriation and Control Act will expand eligibility for the B.C. training and education savings program. Currently the program helps B.C. families save for their children’s post-secondary education by enabling children born on or after January 1, 2007, to receive a one-time grant of $1,200 into a registered education savings plan. This amendment extends the program to B.C. children born or after January 1, 2006, a one-year expansion. Regulations will be amended to enable the expanded eligibility for financial assistance and as a result will support an additional estimated 40,000 B.C. children in reaching their education and training goals.

That’s

part 1.

Part 2 of Bill 10 amends six statutes to implement many of the tax measures announced in Budget 2016. Bill 10 amends the Income Tax Act to create a new farmers food donation tax credit. The new non-refundable credit complements the existing charitable dona-

[ Page 10726 ]

tions tax incentive by providing an additional benefit to farmers who donate qualifying agricultural products to a registered charity that provides food to those in need. The credit is 25 percent of the fair market value of the agricultural products donated.

The Income Tax Act is also amended to expand, extend or clarify several other tax credits effective for the 2016 tax year. The B.C. tax reduction credit phase-out threshold is increased to $19,400 from $19,000.

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The credit phase-out rate is also increased to 3.56 percent from 3.5 percent. This enhancement will increase the amount that British Columbians can earn before paying any provincial income tax, and it provides a modest benefit to a significant number of lower-income taxpayers.

The B.C. mining flow-through share tax credit is extended for one year, to the end of 2016, and the mining exploration tax credit is extended for three years, to the end of 2019. Mineral exploration, of course, is a vital part of our economy, and the flow-through share tax credit and mining exploration tax credit do help encourage investment in mineral exploration and development.

Further, the regional and distant location tax credits for animation productions are being clarified to ensure that credits are based on the amount of eligible labour expenditures actually incurred in the regional or distant location areas. This clarification will ensure that the original policy and intent of the credit is achieved and maintained.

Bill 10 also amends the Income Tax Act to parallel federal changes to the taxation of trusts and estates. Effective for tax years ending after December 31, 2015, graduated personal income tax rates will only apply to trusts that are “graduated rate estates” or “qualified disability trusts,” as defined in the federal Income Tax Act and implemented as part of the federal 2014 budget.

The top marginal personal income tax rate will apply to all other trusts and estates in B.C., and in our view, these changes — all of them that I’ve referred to — will ensure and improve tax fairness.

Bill 10 also provides support for small businesses. The Small Business Venture Capital Act is amended to allow for a continuation of tax credits to support eligible new corporations. Bill 10 also amends the property transfer tax in a significant way to create a significant exemption for newly constructed housing. The exemption will be available to Canadian citizens and permanent residents of Canada who buy a qualifying new home worth up to $750,000 and live in it as their principal residence.

There is a phase-out of the exemption up to $800,000. There is no requirement that the purchaser be a first-time homebuyer, but the home must be a newly constructed or a newly subdivided home. The exemption is available to new arrivals in B.C., subject to the conditions I mentioned a moment ago.

The new exemption, we believe, will assist purchasers and help stimulate the market to supply moderately priced homes. It will also support measures taken by local government to encourage densification and the creation of newly affordably priced housing.

Bill 10 also amends the same act to implement a 3 percent tax rate on the portion of fair market value of a property above $2 million. The 1 percent rate will continue to apply to the first $200,000 of property value, and the 2 percent rate will continue to apply on the value of property above $200,000 up to $2 million. The new third rate, which is applicable to higher-priced properties, will help offset the cost of the new housing exemption.

The act is also amended to require the collection of certain information. That is the collection of citizenship information on foreign purchasers of property in British Columbia, and to collect data on the use of bare trusts.

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Individuals who purchase property in B.C. who are not either Canadian citizens or permanent residents of Canada will be required to disclose their citizenship on registration of a taxable transaction. Corporations who purchase property in B.C. will be required to disclose on registration of a taxable transaction the name, the address and citizenship of any director who is not a Canadian citizen or permanent resident of Canada.

Similarly, bare trustees who register as the legal owner of property will be required to disclose the names, addresses and citizenship information of the settler and beneficiary of the bare trust on registration of a taxable transaction.

This data will be used to compile statistical information on real estate purchases in British Columbia and for the enforcement and administration of tax statutes. These data collection requirements will come into force by regulation this summer.

Bill 10 also amends the Tourist Accommodation Assessment Relief Act to provide enhanced assessment relief for eligible short-term accommodation properties located outside of municipalities. The maximum reduction in assessed value has increased to $500,000 from $150,000, and the assessed value at which the phase-out of the benefit begins is increased to $4 million.

These amendments will enhance relief for short-term accommodation operators in rural areas of B.C. and make their property tax savings more comparable to those of operators within municipalities. It will include more rural operators who lost this tax relief as their prop-

[ Page 10727 ]

erty values increased. I can say that the changes I’ve just referred to meet our specific commitment to modernize the act in that respect.

Finally, Bill 10 amends the Carbon Tax Act and the Motor Fuel Tax Act to provide, effective March 1, 2016, an exemption for collectors from the requirement to pay security to government if they sell fuel to a person who is exempt from the requirement to pay securities.

Also effective on March 1, 2016, a deputy collector is exempt from the requirement to pay security on fuel bought in British Columbia if the fuel is to be sold outside of British Columbia by the deputy collector and the fuel is removed from British Columbia under certain circumstances.

These specific exemptions will reduce the compliance burden on certain collectors and certain deputy collectors by reducing the need to apply for refunds of security in those circumstances.

I know that we will have an opportunity — in addition to the opportunity that will follow second reading, in committee — to discuss in more detail some of these provisions.

If I might, to my colleague across the way…. I do apologize for this. I somehow managed to double-book myself this afternoon, and if I am obliged to leave the chamber, rest assured that I will be reviewing her remarks in detail. I look forward to submissions from others in second reading on this bill.

C. James: Thank you to the minister for his comments. I will take no offence if you leave the chamber.

Certainly, although the minister and I and maybe a few others in this House might find the minutiae in the implementation bill interesting, I do think it’s important to just remind the few members of the public who may be watching that this isn’t actually a vote on the budget.

I think that’s important, because we’ve seen a lot of the broader budget debate over the last while. In fact, as the minister has stated, this implements measures in the budget that require legislation and that require legislative amendments, as the minister has said.

You’ll see some minor changes, some technical provisions, as the minister has outlined — I appreciate the outline of the specific provisions in the bill — and a couple of larger pieces, as well, that I’ll spend a little bit of time on.

I just want to walk through a couple of the sections of the bill. As the minister has talked about, there’ll be much more opportunity for details and for specific questions on the sections when we get to third reading. So I’ll touch briefly on those sections and spend a little bit of time, as I said, on the things that are in the bill.

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I also want to take a little bit of time, because I think it’s also helpful to the public, to take a look at what’s not in the bill. I think that’s also important as those who watch this wonder why some measures are included and some measures are not, why some of the budget is included in this bill and why other pieces aren’t.

I think probably the place to start around what’s not in the bill, where the public might expect it to arrive, would be MSP changes. I think most of the public, if you took a look and asked most of the people on the street, would certainly think that their medical services premium is a tax.

Although the government may not call it a tax and may call it a premium and look at it in a different kind of way, certainly the majority of British Columbians that I talk to and that others talk to would consider medical services premiums a tax and would certainly imagine that you would see the changes happen through this bill. But this does not include the MSP changes. Those will come in a different route.

But I just want to take a moment to talk about those because, as I said, I think the majority of British Columbians, when they take a look at tax measures, the people that I talk to, would have expected to see the MSP tax — a tax that the Premier herself has referred to as unfair, as behind the times, as not keeping up with the changes that are there — in this Budget Measures Implementation Act.

As I said, the government doesn’t like to call them taxes. They like to talk about keeping taxes low. But when you include those medical services premiums, when you include that tax for families, for British Columbians, in fact it hugely increases the amount of tax that people in this province are paying. In fact, in some cases, you are seeing families paying as much in MSP taxes as they are in their income tax. That’s how much money is now gathered around the increase in medical services premiums.

I think the other piece that is important to note around the medical services premium tax is the unfairness of that tax. I mention it because in the budget, and certainly in some of the other tax measures that are coming forward in this implementation bill, the Finance Minister and the government talk about tax fairness. They talk about how to actually make sure that a tax is fairer, that some of the specific provisions in this implementation bill actually refer to that. They refer to both clarifying tax as well as making tax fair and making changes in the tax system.

Well, one big tax in this province is left out of all of this, and that’s the medical services premium tax. There isn’t anything, as far as I’ve been able to see, that is as unfair as that tax is when it comes to British Columbians, when it comes to families. There are some changes, yes. It’s true that there are some changes coming to the medical services premium tax, but not until January of next year, and the unfairness remains for those people who will continue paying medical services premium tax.

The other piece that’s important to note is that the medical services premium tax goes up 4 percent. It went up 4 percent in January of this year, in this year’s budget, and it goes up again 4 percent in next year’s budget. So as I said, although some people will actually benefit, you in fact will find that some people will be paying more

[ Page 10728 ]

medical services premium tax. More revenue is actually collected by government on the medical services premium tax.

I think British Columbians who are taking a look and hearing from the government side that this bill coming forward, Bill 10, includes provisions to look at tax fairness will see a big hole. They’ll see a big hole in this bill, which is the medical services premium tax and addressing that — addressing the fact that if you make $50,000 or you make $1 million dollars, you actually pay the same amount in medical services premium tax, and that won’t change with the changes that are coming forward.

I think that’s a question the public will certainly have. That’ll be a question that I expect the members on the other side will be receiving and a question, certainly, that I think is still out there.

Now, I have heard the Premier speculate that there may be further changes coming in future budgets. I don’t want to be cynical and say that next year is election year, but I think it’s important to note the timing of the announcements that small changes are being made and perhaps something might come next year. Well, next year does happen to be an election year.

[1355]

As I said, I certainly wouldn’t want to be cynical and presume that’s why the timing has been done on this, but I think it’s important to note it in all of this.

The other piece that is not included in this bill — and as I said, I’m going to speak to both the pieces that are included and not included — and that the public might expect to come forward would be the tax break that was given to the top 2 percent of income earners in British Columbia. Again, when you talk about tax measures and you talk about bringing forward changes to the tax system, I think the public would expect that they might see that there.

Yes, for those who don’t know, the government, even in, as they claim, fragile economic times — certainly last year, and it carries over again into the 2016 budget — did find money in the budget. They did, in fact, find money to give the top 2 percent of income earners, including millionaires in this province, a tax break that cost $230 million. It’s not included in Bill 10, and I think it’s important to take a look just for a moment at why that is.

It’s because the government, in fact, just eliminated the top income tax bracket to take effect, to give that tax break to the top 2 percent. You may hear the government saying: “Well, we didn’t give a tax break. The sunset clause just expired. It was just a clause that we put in place that put a tax increase in for a couple of years, and then it just expired.”

Interjection.

C. James: As my colleague says, it wasn’t possible to do anything. It was there. It was going to expire in a year.

Well, we have seen this government and other governments make decisions all the time to make changes. I think it’s important for the public to remember that this government, even with the small changes they’re making around MSP taxes, has said to the public: “You have to wait for those until next January. You’re required to wait until next January. But by the way, on the tax break for millionaires, of course we made sure that that one happened. We didn’t deal with the clause to be able to keep those taxes coming in. We in fact said to millionaires, ‘It’s fine. Don’t worry. You get your tax break.’”

I think that the fees and services that have been downloaded onto British Columbians — not included in Bill 10 — speaks to the challenges that families are facing and the lack of regard that the government has given to how much those additional taxes put onto British Columbians.

It’s not simply the income tax system that adds a burden to British Columbians. It’s not simply the taxes that they pay at the end of the year that add to the cost for families when they’re trying to get by. In fact, the fees and the services and the money that government collects from all of that now is equal or surpassing, in some cases, the kind of income tax that families are paying.

When you look at a family who is trying to get by, paycheque to paycheque, trying to manage, trying to put a little bit aside just in case something occurs and they need those resources, most of the families I talk to say they’re barely able to pay their bills. They’re barely able to get by. So although the minister and the government like to talk about the fact that British Columbia families are well off, certainly, the families that I talk to find it tougher and tougher to get by.

If you take a look at the increase in fees, which the government, as I said, likes to not call taxes, so they’re not included in Bill 10…. If you take a look at the cost of those fees, you can understand why families are facing pressure. It’s not that families are not utilizing their money well. In fact, families are incredibly resilient.

It’s extraordinary, when you look at these increases, that people actually are managing paycheque to paycheque. Hydro rates have gone up by 74 percent. In 2014, they went up 9 percent; 2015, 6 percent; 2016, 4 percent. In 2017, they’re going up 3.5, and in 2018, 3 percent. That’s in addition to the other taxes that are already there.

Ferry fares, 77 percent. Tuition has more than doubled. ICBC rates have gone up 48 percent since 2001. Even long-term care, when families are really struggling, when it’s one of the most difficult times, when they’re making decisions about a loved one going into long-term care — even that’s gone up 93 percent.

Although those changes are not included in Bill 10, they are, in fact, part of the budget. They are part of Budget 2016, and I think it’s important to lay them out.

[1400]

For the public to listen to some of the sections of this bill, they might wonder where those other parts of the

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budget are, the other parts of the budget that have such a great impact on the struggles that they’re facing — have such a great impact and really show, as a budget does, the character of a government who puts families at the bottom of the list. It puts the top 2 percent of income earners at the top of the list, makes sure they get their break, but doesn’t take a look at the pressures that families are facing around those taxes — a complete disregard, from my perspective, for families.

What changes are in this bill? I’ll speak a little bit about those — as I said, remembering that we will do the specific questions when we get to further committee stage.

One of the changes that the minister raised is a new farmers food donation tax credit. It’s available to individuals and corporations that donate food to a registered charity. Now, I certainly would speak in support of farming and would certainly speak in support of farmers and of farmers donating extra produce or other things that are produced on their farm. I support the option for those in need, for the most vulnerable in our province, to be able to access local food. But I also have to say that it raises all kinds of questions, and we’ll get to some of these questions when we get to committee stage.

You know, if we take a look at whether this actually does support the most vulnerable in British Columbia…. Is providing a tax credit to farmers actually going to make sure that more food gets donated to the food banks? Are food banks really the government’s solution to how we address the issue of poverty and inequality in British Columbia? I think that’s a reasonable question.

It’s a reasonable question when you take a look at the inequality rates in British Columbia. We continue to have, and again this year…. I think we were No. 2 last year. This year we are, once again, the province that has the highest rate of child poverty in this country. I’ve heard debates from members on the other side about which statistic you use and what measurement you use. Well, by any measurement, British Columbia is way down the list when it comes to support for the most vulnerable, when it comes to support for people living in poverty.

We have a huge, high use of food banks. Over 50 percent of the people who utilize food banks are working, not people on income assistance. They are people who are working, who are trying to put together two and three jobs, who are working at minimum wage that doesn’t make their rent that they have to pay each month. They’re having to use food banks to be able to stretch that dollar.

I think there will certainly be questions from myself, questions from our spokesperson on agriculture as well, around what specific support this is going to provide to ensure that those resources actually get to the food banks and, as I said, whether food banks, in actuality, are this government’s solution to poverty and to inequality.

I would suggest that there are a number of actions that could begin to be done, including a poverty reduction strategy in British Columbia. The Premier talks often about being number one. Well, in fact, we are number one in this case. We’re the only province across this country that doesn’t have a poverty reduction strategy.

A poverty reduction strategy doesn’t mean you fix everything overnight. It doesn’t mean we’re going to make poverty disappear overnight. What it does mean…. I’ve certainly learned this in my time as an MLA and in other positions I’ve had in my career. If you don’t pay attention to it, if you’re not measuring it, if you’re not reporting out on it, it doesn’t get the same kind of focus and the same kind of resources and the same kind of support that it should.

That’s why I feel it’s so important to ensure that we have a poverty reduction strategy put into place. It would require a report to the Legislature each year. It would require independent reporting out. It would require that ministries work together to look at strategies. It would require a comprehensive plan to address poverty that would include not simply farmers and food banks but housing, income assistance rates, health care, child care — all of those issues that have an impact on poverty, in fact, could be addressed through a poverty reduction strategy.

[1405]

So as I said, while I’m certainly not opposed to a break that I hope will assist people who are the most vulnerable, that I hope will assist farmers, I will have some questions, as I know our spokesperson will, when we get to this

section of the bill. Does it really address the support for farmers? I think that’s going to be a reasonable question to ask as well.

Deputy Speaker: The member for Burnaby–Deer Lake seeks leave to make an introduction.

Leave granted.

Introductions by Members

K. Corrigan: It gives me a great deal of pleasure to welcome into the chamber today my dear sister Dr. Jeanne Keegan-Henry, who has just retired from her long career as a doctor and is spending many happy hours not being a doctor. She’s in Victoria today, here with her husband, Rowan Keegan-Henry. I hope the House will make them very welcome.

Debate Continued

C. James: Welcome to the member’s sister and family.

As I was saying, I think it’s also important to take a look and see whether this also actually supports the farming community. Is this the kind of strategy that’s going to make a difference there?

One of the other pieces that the minister mentioned was the B.C. seniors home-renovation tax credit. That’s now been expanded to persons with disabilities, which is

[ Page 10730 ]

But again, just as with other initiatives, other small pieces that we’ve seen come forward from this government, I think there are many questions for seniors and for people with disabilities who would not even have the income to be able to take a look at doing renovations or who could only dream of owning a home to be able to get the tax credit for the renovations.

It’s a bit like we saw last year, in last year’s budget, where we saw the government come forward with a tax credit for teachers and for teaching assistants who carried out ten hours of extracurricular coaching. It sounds terrific. It sounds like a great tax credit. It sounds like support for people who put the extra hours in, who put the extra time in.

Then when you took a look at it, in fact that benefit worked out to a total of $25.30. Well, I can tell you that most of the coaches and most of the assistants that I know put in many, many, many more resources than that, simply of their own money, never mind looking at tax credits.

We’ve seen a pattern over the last while, certainly since this government was elected. We’ve seen a pattern where the government makes massive cuts, where they pull back on programs, pull back on supports, and then a little bit is given back. It’s almost as though the government expects people to be grateful for the little bit that comes back after all of the cuts and all the resources that have been taken away. You know, people who are vulnerable — seniors, people with disabilities — are struggling, and every little bit helps, but that’s not a plan of support. That’s not a plan to try and address the challenges that they’re facing.

I think, probably — I’m not sure how else to refer to it — the best of the worst example of all of these has been, in the 2016 budget, the bus pass issue. The government put out for people with disabilities that they would be receiving a $77-a-month increase. “Wasn’t that going to be wonderful? But by the way, that $45-a-year bus pass that you used to get that was subsidized? That’s not there anymore. You now can apply for a subsidized bus pass. It’s going to cost you $55 a month.” So people who actually expected that they were going to get those resources….

You know, I’ve heard members on the other side say that we’re simply politicizing this issue. Well, I’m sorry, but I have had people with disabilities, both on the weekend and in my office this week, in tears because they believed that those extra resources were going to come to them.

They know how difficult it is. They know that they are struggling. They saw the $77 and thought that finally they were going to get that kind of support and would be able to manage a little bit easier. It’s not going to solve all of their problems, but manage a little bit easier. They then find that the government gives with one hand and takes away with the other. “By the way, $55 of that now has to go to your bus pass. Oh yes, you used to have it for $45 a year, but now — sorry — it’s going to cost you $55 a month. It’s still subsidized,” the government says. Well, what a way to treat people.

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There were some tax credits — and I think that the minister mentioned a few of them — that we supported last year that are continuing on this year. One of them, of course, is the mining flow-through share tax credit and the mineral exploration tax credit. Those were credits, as I said, that we saw come in that have been expanded or extended over a couple of years and that we support for an industry that really is struggling right now and having difficulty in British Columbia. Commodity markets, obviously, have a huge impact on that.

I’m glad to see some attention being paid to some other industries — other than LNG — for a change. I’m glad to see those provisions come forward. Then there were a couple of, as the minister said, technical or clarification sections — one of those being the film production tax credits.

There is an interesting piece along with that, though. I know, again, that our spokesperson on the arts will speak a little bit more about this and will have some very specific questions when we get to committee stage. But the government also mentioned that they want to work with industry to examine those film tax credits. They said that they want to do a review as part of the clarification.

It says in the budget itself — just to quote it — “to develop solutions that can be implemented this year” to address the rising cost of film tax credits. I think that’s an interesting piece, and as the minister has said, the industry approached government. I believe he said that in his budget remarks. It’s a piece that we’ll want to ask some very specific questions on, because I think we know the tax credits have been supported, certainly were supported by previous governments as well as the current government.

We are very blessed in British Columbia to have an incredible industry here in our province with an incredibly well-trained, well-educated and strong workforce in that area. Although the dollar certainly helps and the tax credit helps, we also know that it’s the workers on the ground that also make a huge difference when it comes to attracting productions here, when it comes to bringing additional work here in British Columbia.

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Also, that the tax credit is linked to B.C. workers is another very important piece in all of this. As I said, we’ll ask some questions at committee stage. But I certainly hope that the minister, in those discussions around looking for solutions with the tax credits, will be focused on B.C. productions, B.C. workers and B.C. jobs as part of that. We’ll also be looking at the stability in the industry, because we have seen, in previous years, the whipsawing that has occurred with taxation when it comes to the film industry.

It’s a very mobile industry, and we’ve seen provinces play it off each other. We do have some stability, from what I’ve seen in the market right now across the country, and I think no one wants to open that up again to the whipsawing that we’ve seen previously. I hope that we’ll see some consistency there and some stability and not end up opening up that discussion again in any of the discussions that the minister is going to have.

We also see in this bill the B.C. training and education savings program changed, now available for an additional year for children who were born in 2006. We’ll have some specific questions around that again when we get to committee stage.

I think last year, when the government brought the program in, there was an expectation of about a 50 percent takeup of that program by the number of children who were going to take part, or families who were going to take part, in that program. So I think it’ll be interesting to see what the expectation is for the expansion of a program and what the enrolment numbers look like now that it’s been in place for a short period of time.

I think it’s also important to take a look at what the government may have considered as other alternatives, whether grant programs or the cost of tuition to support students now. There are many families who — while they wouldn’t be turning down $1,000 to help their child, 15, 16, 17 years from now, go into university or college or a training program — are struggling with those costs of tuition now, are struggling to be able to manage their child going to university or college now.

[1415]

This program does not help those individuals or those families who are paying all of those fees and services and continuing to pay the high cost of tuition and the struggles that that’s creating for families as well. I think that’ll be a piece that, as I said, we’ll be taking a look at.

Some administrative changes, as the minister has said, to the carbon tax and the fuel tax collection, and we’ll have some questions at committee stage.

An interesting change for ICBC. I’m certain that our spokesperson on ICBC will have some more detailed questions for the minister when we get into third reading, but it is interesting to take a look at the change of the fiscal year for ICBC and to ask some questions about why that fiscal year is changing from December 31 to March 31.

Again, not to be cynical, but there are those who feel that the fact that ICBC was never making its mark when it came to its annual report…. Does this make it a little bit easier for them to stall off on getting their annual report out? I think those will be important questions to be able to speak to.

That leaves just the last two sections of Bill 10 that I want to take a moment to talk about, and that’s the housing

section and the prosperity fund. I know that our spokesperson on housing is going to have more to say on this section. We’ll ask some very specific questions as we go through committee to discuss it, but I feel that this

section of the bill really is a missed opportunity.

It’s a missed opportunity for government to do a couple of things. First, to recognize and to acknowledge the affordability crisis in housing. I think the public…. It’s not simply the Lower Mainland, not simply Vancouver, as many ministers have stood up and said. Many members have stood up on the other side and said this is simply a Vancouver problem. It’s, in fact, a much larger problem than a Vancouver problem.

Housing is a crisis in many parts of British Columbia. I think the budget was an opportunity and this bill, Bill 10, was an opportunity for government to really show that they understood, that they recognized the real affordability crisis in housing.

Then the second piece that it was an opportunity for was to do something meaningful to address it. Again, I think that was a real missed opportunity. I didn’t see anything in this bill — and just to let the Speaker know that I’ll continue on as the designated speaker on this bill as well — on the opportunity to address something like shadow flipping, which has been raised in this House; the opportunity to close the loopholes on property transfer tax, to provide an opportunity for the government to do that; to address the bare trust issue.

Where was the commitment to address those kinds of things in Bill 10? Those are pieces that in fact aren’t in the bill. They aren’t there.

Where was a commitment to address or at least examine…? Even if the government didn’t say that they were going to take it on and implement it, where was the opportunity for the government to at least say in Bill 10 or in the budget that they were going to look at the proposal and examine the proposal from a group of professors at UBC on absentee owner tax? Again, it’s a very interesting proposal, a very different kind of approach to how you deal with the issue of vacancies, the issue of very expensive properties, the issue of the challenge in parts of our province.

I’m glad to see in Bill 10 that it mentions that the information now is going to be collected by the government, that they’re going to actually take a look at absenteeism, take a look at citizenship, etc., to at least get the information in there. I think that’s very important. I’m glad that government is doing that.

[ Page 10732 ]

I’m glad that the support is there for new homes up to $750,000, but I think that it leaves a lot to be desired. I think it leaves a lot out — and late to the game. This has been an issue that has been raised over and over and over again, and I think that we saw the government simply tinker around the edges on this issue when they brought forward the changes that we see in Bill 10.

The other interesting piece on housing that’s important to at least note here is a piece that often is talked about as part of addressing the issue of housing affordability and part of addressing the supply challenge. It’s the issue of renters. We see nothing in this budget that addresses the issues of renters. We see nothing in this budget that addresses the issue of renovictions, for example.

[1420]

We’ve gone through, in my own community, some real challenges with a new owner buying buildings up in my community and then starting to evict people and starting to let people know that their rent, when they come back, was going to be, in some cases, twice what it was when they were living there. No opportunity for them to be able to challenge their renovations to see whether they were in part. It created real fear for many seniors in my community who don’t have other opportunities.

The vacancy rate in Victoria is 0.06 percent. We have a very, very low vacancy rate. I hear the Housing Minister often say that rent supplements are the answer to everything. Well, rent supplements are one answer, if you’ve got vacancies. Rent supplements don’t help you if you don’t have any place to rent, if you can’t find a vacant apartment.

Again, over Christmas I had seniors in tears in my office, talking about waiting for that eviction notice, or the few who did get an eviction notice, the fear that created for them about where they were going to live — people who’d lived in their apartments 25 years and expected to live their life out in those apartments.

In the housing

section of Bill 10, there wasn’t anything that I saw that provided support to tenants, that provided support to renters, that provided support to encourage rental housing being built.

That’s another area where, certainly, I’ve had discussions. I’m sure the members on the other side have had those discussions with the Real Estate Council about encouraging rental housing to be built and how government could provide support for that to, again, ease the vacancy rate, to deal with some of the supply issue and to have that continuum of housing that is so important. I think that, again, was another missing piece from Bill 10.

Then the last piece to speak on this bill in second reading debate, of course, is the prosperity fund. I just want to take a minute to reflect on a bit of history here. I think it’s important for all of us to remember that the Premier set LNG as her sole focus during the last election campaign. We saw — and people will remember this — right after the election the Premier send her letters of expectation to all the ministers, and included in those letters of expectation was their responsibility to support the LNG industry in this province.

Those letters went to everyone, including the Ministry of Children and Families, including the Minister of Health. You might wonder how much of their time and energy was spent supporting LNG instead of the areas in their ministry. But that actually was included in part of the letters of expectation.

The Premier talked about laser focus on LNG, that that was the particular area. I think at one point wealth was going to rain down on British Columbians from the LNG industry. We were going to be debt-free. We were going to see sales tax gone. We were going to see health care improved. We were going to see education improved.

Well, that certainly hasn’t happened. We were going to see plants up and running by 2015. That was also going to be part of the Premier’s plan. Again, that hasn’t happened. In fact, if you take a look at this budget, we see just the opposite when it comes to things like education, where we haven’t seen increases in budgets. In fact, we’ve seen challenges for classroom teachers, for class size. We’ve seen real difficulties for class composition, for an area where we should be investing, where we should be putting more resources.

The Premier, as part of her commitments, as part of her promises when it came to LNG, also promised a prosperity fund. That prosperity fund was supposed to take all of this wealth that was going to be raining down on us from LNG and put a portion of it into a prosperity fund and make sure that we had that money put aside.

In fact, during the discussion around the prosperity fund, we had discussions about if new industry came to British Columbia, if you saw resources flowing, that a prosperity fund and putting some money aside may make some sense. But that is not what we are seeing when it comes to this bill. That is not what we are seeing when it comes to the prosperity fund.

[1425]

In fact, what we are seeing is a fantasy fund, a fantasy fund for the Premier — I guess to save herself some embarrassment for having broken her promise to British Columbians, for having put all of her eggs in the one basket, for having spent all these years ignoring all of those industries that are so valuable to us in British Columbia….

Interjection.

C. James: “And then drop the basket,” the member says. I think that’s what we’re seeing here.

It really feels a bit like Alice in Wonderland some days. We’re seeing a fund put together from an industry that doesn’t exist, that hasn’t come to British Columbia, without any revenue. It really is extraordinary, hon. Speaker — $100 million in this bill. This enacts that in this bill, in

[ Page 10733 ]

this budget. So 100 million taxpayer dollars — not new LNG revenue, as we were promised — will be put into a fund where one of the criteria is: “Will be available for core government priorities in the future.”

Well, again, as I was saying earlier, I’m sure that it’s just a coincidence that the future happens to be next year, when there’s an election. I’m certain that’s just a coincidence. The fact that we see money being taken and put into a fund for an industry that doesn’t exist, simply to have the Premier be able to say the money is there…. Well, British Columbians will not buy that. British Columbians know the industry has not arrived. British Columbians know the challenges that are there.

I think that it’s also no coincidence that $100 million going into the prosperity fund is also just roughly the amount of money that the government is collecting from MSP increases this year — 4 percent, which works out to about $100 million. Again, I find it extraordinary that we’re talking about $100 million in a budget and a government making a choice to move it into a fantasy fund for an industry that hasn’t existed.

We asked a lot of questions about this over the last year. We asked questions of the minister, and we asked questions of the Premier around this fund — when the fund was going to come forward, when the criteria was going to be developed. I want to just read a quote from one of those discussions that we had with the minister.

We asked about the prosperity fund and when the prosperity fund was going to be put together. The minister said: “Before the government asks the House to consider legislation relating to a prosperity fund, we’ll be asking the House to consider legislation to ratify the first project development agreement.” In fact, the Finance Minister stated during that time period when LNG arrived in British Columbia, when you saw investments being made, that in fact you would see the prosperity fund start to be developed. We would presume, as the public would, that when that revenue started flowing, the prosperity fund would be opened and you would be able to put some of that revenue in there.

Well, we got news again today that another company has pulled out. Alta Gas has now pulled out — not simply postponed but in fact pulled out their project. So another one down.

Yet the government decides that of the few things they’re actually going to do in the budget, the Premier’s fantasy fund is one of those. We’re going to create this fund. We’re going to put it aside — $100 million? I think the public would be asking themselves, as we do: what prosperity? What prosperity, and for who?

It’s certainly not for the families that I talked about. Certainly not for those who are struggling, who are working hard and doing everything right.

We will have many more questions when we get to committee stage. I know others want an opportunity to be able to speak on this bill.

With that, I’ll wrap up, take my place and look forward to committee discussion.

D. Barnett: It is my pleasure and great honour to rise today on behalf of the people of the Cariboo-Chilcotin to comment on Bill 10, the Budget Measures Implementation Act.

First, I would like to thank my CAs for their hard work and continued support of our constituents: Bev Harris in 100 Mile House; Bonnie Gavin, who has moved on to Salmon Arm after almost seven years of hard work and dedication; and a big welcome to Jenny Huffman, who is now my assistant in Williams Lake. I also want to thank all the staff in our local government offices for the service they provide for our citizens. To the staff in this great institution: thank you. And to my past LAs and present LA, Carl Richmond.

[1430]

To my colleagues, some days in this institute are tough from time to time. We disagree, which is healthy, but at the end of the day, what we as a government have accomplished over the past years has built a better future for greater generations to come.

Balancing the needs of our province in good times is easy. Balancing the needs in times when our country and the global economy are in a state of uncertainty is not easy. But this government has done so for its fourth consecutive term. We as government, in this budget, have made tough decisions, taking our whole province into consideration.

The real estate market is a free enterprise system. It takes two parties to make a real estate transaction: a willing buyer and a willing seller — also, supply and demand. Governments need not interfere with this system. Foreign investment has helped build this country. It is very upsetting to hear the opposition not welcome the world to this province. Oh, they want some, but only those they choose. I believe in an open door to all the world as long as the laws of our land are adhered to.

What is upsetting to me is the opposition’s accusations that realtors may be dishonest. Many of my friends are realtors, and I was one myself. When I went home this past weekend and spoke with them, their industry feels they have been tainted by the opposition’s comments. I guess the opposition also say no to a real estate industry.

[R. Chouhan in the chair.]

My portfolio is rural development. Rural B.C. represents 70 percent or more of the geographical area of this province. Listening to the opposition day in and day out, this province consists of Vancouver and a few miles beyond — maybe as far as Langley. The exemption from real estate purchase sales tax, up to $750,000 for new homes, opens up an opportunity for a rural B.C. construction industry. This, I will remind the opposition, is jobs and opportunities for all.

[ Page 10734 ]

The Tourist Accommodation (Assessment Relief) Act, increasing the threshold from $150,000 to $500,000, up to $4 million from $2 million, gives our rural tourism operators a hand up, and I thank the minister for filling this important need.

I listen to the opposition on minimum wage. In my past life, my husband and I had small businesses. Did we hire at minimum wage? Maybe to start. But any business we had or I know of…. Businesses are free enterprise and pay good employees what they can afford and pay well to keep good employees.

The opposition talks about doom and gloom. I ask the opposition: what is your plan?

More exciting news for rural B.C. — the $75 million, three-year dividend program. In the very near future, we will announce the process for applications for the first $25 million for rural communities.

As Parliamentary Secretary for Rural Development and chair of the rural advisory council, this is an exciting time. Our Minister of Community, Sport and Cultural Development announced, along with the federal government and the UBCM, the gas tax revenue grants: $4 million to the Cariboo regional district and city of Williams Lake for their pool upgrades; nearly $6 million to the district of 100 Mile House for water upgrades — wells, water towers and opportunities for industrial, commercial and residential growth.

Many gaming grants continuously to the Cariboo-Chilcotin and the province of British Columbia. Transportation is spending millions of dollars in the Cariboo-Chilcotin on Highway 97, the Cariboo connector; on Highway 20; and more. Our health care, education and local programs are the best in the country.

Programs at TRU university in Williams Lake. We have a saw-filing course, the only one in North America.

We have an agriculture stability program, a brand-new program, the only one in B.C.

[1435]

I could go on for hours, probably for days, on what builds a province, what creates an economy and what this government has done for rural B.C. Four balanced budgets. We are proud. We are optimistic. This budget has something for all British Columbians.

B. Ralston: I rise to address Bill 10, Budget Measures Implementation Act. Of course, as the member for Victoria–Beacon Hill and, indeed, the Finance Minister have so carefully expressed, this is the suite of legislation that implements the budget that we’ve just debated and indeed voted upon this morning.

I voted against the budget. I did so for some of the reasons articulated in the past by Gordon Campbell, a beloved figure on the other side, except, perhaps, for a few. What he said when he was in opposition about why he was voting against the budget was that in the British parliamentary system, a vote against the budget is an expression of non-confidence in the government.

It’s not about individual line items in the budget, as much as those learned people in the 250-person crew in the public affairs department would like people to believe. It’s an expression about competing visions. A vote against the budget is a vote of non-confidence in the government. Certainly, I and those of us on this side do not have confidence in the government.

There are a number of measures in this. The member for Victoria–Beacon Hill has addressed almost all of them. I will be a little bit more selective in the items that I wish to comment upon in this speech.

One of the signature pieces, one of the hallmarks, of this budget is the creation of the so-called prosperity fund. It’s striking that this really reverses the tone and some of the comments the Finance Minister has made over several years now about the timing of the creation of a prosperity fund, because the prosperity fund was to gather the revenue — the anticipated revenue, which was promised in the last election — in a separate fund and use it for future purposes. Very much, I suppose, the model would be….

The most successful fund of that type is in Norway, where the fund is now at $800 million or $900 million, largely invested outside of Norway to avoid impact on the currency and overheating the Norwegian economy. It’s invested widely in real estate, in the stock markets, in a number of ventures globally, and continues to gather wealth from what is a non-renewable resource. Norway — in their case, it’s an oil industry. They a have a state oil company, Statoil. That’s the purpose of that fund.

Alberta had a pale imitation of that fund, which successive Conservative governments, notwithstanding the political nomenclature, couldn’t resist putting their sticky fingers on and pulling out. Despite the initial vision of Peter Lougheed, the original Conservative Premier who set it up, it has really not achieved the dimensions and the growth and the fiscal impact that the fund in Norway has. In Alberta, they call it a sovereign wealth fund.

That’s the model. There are sovereign wealth funds in many jurisdictions, typically ones where there is great resource wealth. The idea is not new. Generally, the practice is, I think without exception, that you have to have revenue to put in the fund before you create the fund. Nonetheless, in this budget, the government decided to create the fund.

In the budget note, the topic box, there’s an explanation. This is the government explaining the fund in its own budget documents. This is not something that I’m inventing or making up. This is what the government has used. This is the explanation the government gives.

[1440]

They put in $100 million from general revenue. As the member for Victoria–Beacon Hill points out, that’s approximately the increase in medical services premiums that the general public is going to pay this year. The way

[ Page 10735 ]

the fund works, the direction of the fund, I think it would be fair to say…. I think most people would agree that it was a shell game.

The explanation in the budget document says that you put $100 million in, and $50 million will go out right away to pay down debt, and another $25 million will be reserved for government purposes, special projects.

The Premier sometimes has special projects. I know she wanted to celebrate yoga on the Burrard Street Bridge. Maybe this is something that didn’t work out so well, because the public didn’t support it. It also happened to be National Aboriginal Day — a little bit of a miscalculation by the big brains in the Premier’s office. So that was set aside. There are those kinds of photo-op opportunities that the Premier wants to have.

In this fund, $50 million is going to go right out to pay down debt, and $25 million is going to be reserved for spending for special projects that the Premier has in mind. Only $25 million will actually stay in the fund. Even more than most initiatives by the government, the reality is very, very tawdry indeed. It’s very, very tawdry.

The irony of this debate on this day is that it comes on a day when LNG…. It’s subject to market prices. It’s remarkable to me that a government that claims that they’re a free enterprise…. Sometimes they call themselves private enterprise. Resource prices, historically and around the world, are driven by markets.

They claim to understand markets, yet they based most of their electoral calculations and a lot of their political calculations in the last couple of years on a resource price that’s determined in a world market, and it’s gone down.

Now, that’s difficult to predict. Certainly, not many people predicted the dramatic decline in the price of oil and the related price of natural gas and, therefore, LNG. But it is well known. It’s notorious that resource prices are cyclical.

Commentators now, with the wisdom of hindsight, say that a resource supercycle — which was roaring for a number of years there, driving up prices of every commodity, particularly driven by industrial demand in the People’s Republic of China — has now gone the other way, headed exactly in the reverse direction.

In fact, today one of the projects, the number or so that the Minister of Natural Gas repeatedly refers to, is Douglas Channel — LNG. It’s a project in which AltaGas is a major partner. Douglas Channel is the inlet that runs from the coast into Kitimat.

They had a proposal, this company. It was a small one, relative to the scale of many of the others. Nonetheless, it was advanced in the sense that it had community support, First Nations support and some financing, apparently. But the announcement was today, and I’m going to read it. They announced today its decision “to halt development of the DC LNG project due to adverse economic conditions and worsening global energy price levels.”

Now, that’s regrettable. It was a good project. It was going to take place on a smaller scale, and as some of these smaller LNG projects do, it was going to be on a barge in Douglas Channel. So the environmental impact is somewhat different and limited in some ways. They had access to a pipeline through their connection with AltaGas. It was something that looked like it might well go. But they are driven by world prices and have made an assessment, and they’re ending it.

[1445]

As much as one can wish…. I know the Minister of Natural Gas always talks about a positive attitude. Well, positive attitude doesn’t, on its own, influence world markets, and that’s the sometimes cold and brutal reality of how the market works.

Again, I always find it a little bit surprising that the government that claims it understands markets and is based on that kind of private enterprise view of the world is somehow startled or taken by surprise by shifts in world markets — above all, in commodity prices, which are notoriously cyclical.

In addition to that announcement today — regrettable in the sense that that was a project that might very well have gone and generated some revenue for the prosperity fund — the competitors in Louisiana, in the United States, announced yesterday, at 7:39 p.m., Wednesday night, that the first tanker with LNG left the Sabine Pass LNG plant in Louisiana, bound for global markets.

Those of you who debated — it would probably be a bit of a specialist taste — the LNG bill will recall that in the project agreement with proponents, the date on which the first shipment took place was a significant milestone. It was a milestone that triggered a number of other calculations in terms of tax and revenue. That’s a very significant date, the date on which the first shipment set sail. That was recognized in the legislation.

The Sabine Pass plant is owned by Cheniere Energy. Cheniere Energy developed the site, starting about the same time as the Premier embarked upon this political venture, back in 2011 or 2012. It was a brownfield industrial site. It was the site of an old, what they called at that time, regasification plant.

The market was so completely turned around at what was happening there that they were importing LNG from other places, regasifying it — that is, taking it from its liquid state back to its gaseous state — and putting it into a pipeline and shipping it out in the United States. The market has changed so dramatically with the shale gas revolution in the United States that now the gas is flowing the other way.

This event took place just last night. So on one hand, a competitor is successful. They have now a fleet of, I think, six LNG tankers that are going to be regularly calling at Sabine Pass and shipping out LNG to global markets. They are operating, largely, more on a spot market basis. They don’t have long-term contracts because they’re buy-

[ Page 10736 ]

ing their gas off the grid in the United States. That will add further supply to perhaps, arguably, an overly supplied market in global LNG.

Add to that, very, very shortly in Australia, the Gorgon project — probably aptly named in the sense that it’s a monster project. It’s a $54 billion venture led by the major global player Chevron. They’re coming into production in a couple of weeks. Now, some of the offtake will be allocated to long-term contracts, but it’s, again, a measure that the global market in LNG at the present price is well supplied, if not oversupplied, and for new entrants, it will be a very tough decision to enter.

They may target supply opportunities, because their horizon is very long term. They may look to 2025, as, arguably, some analysts say there’s a window between 2025 and 2030. So they may want to get started at some point.

Nonetheless, this is a day when the prosperity fund looks even more shrivelled and desiccated and unlikely to draw any real revenue, unfortunately, given the reality of global markets, which I know the members opposite, given their penchant for private enterprise, really understand very well.

[1450]

It’s a staggering lapse or deliberate failure to understand the risk in global markets — that prices go up and prices go down. It’s not unheard of. Certainly, anyone who has a mutual fund can tell you that.

So that’s the signature piece. That’s what this budget implementation bill is really all about. Now, there’s some other stuff that I want to talk about, but that’s one of the choices that was made. Notwithstanding what the Finance Minister said, that’s one of the choices the Premier made. “This is what we’re going to do. We’re going to set up this fund, and I’m going to go around and talk about it, even though, even on the rules that I’ve set up for myself, there’s no real revenue in it, and there’s only going to be $25 million in the fund when we start.”

I don’t want to make light of $25 million, but on the other hand, it is a budget of close to $46 billion or $47 billion. So in the scale of things, relative to the rest of the budget, it’s a very, very small number.

That’s the choice that was made, and this is similar to other choices that the government has made in this budget. The member for Victoria–Beacon Hill, the Finance critic, has talked about the decision that was made — after 2015, after last year — to take out what was, effectively, a surcharge on income tax of those tax filers earning more than $150,000 net income. That’s taxable income.

Anyone who files their taxes — most people do, I hope — knows that for most people, the net taxable is generally lower than your gross income, because you get a few deductions. So generally, someone who is filing an income above $150,000 net taxable is earning, certainly, more than that and, in some cases, significantly more than that, given the range of deductions. The more income you have, generally, the more opportunity there is to take certain tax-planning measures and more exotic kinds of deductions.

There was a surtax placed on that group, which earned approximately $230 million a year. It was for two years. The government chose to let it expire. That’s how they express it. But it is as though they were powerless or incapacitated in some way, that they were standing by — something like watching a traffic accident happen. There was nothing that they could do to change this. But that’s just simply absurd.

If you look at the other measures in this act, they are extending the B.C. mining flow-through share tax credit. That’s something that we support on this side, by the way, just for the Minister of Mines and for the 250 people that are watching this debate. Maybe they could get it right for once on that.

They’ve decided to extend that credit. That’s something that the government can do. That’s something that the Minister of Finance can do. That’s something that the Premier can do.

So the choice to let that revenue go, to not continue the surtax above $150,000 net taxable, is a deliberate policy choice by the government. That’s a choice that they make. Like the prosperity fund, it illustrates their values.

It benefits those at the top end of the income scale, while the rest of the population takes a hit on MSP premiums and pays more. The middle class, squeezed as they are, pays more, and those at the top get an income tax break. Those are the values of the government. Those are the choices they make. That’s why we don’t have confidence in the government. That’s why we voted against the budget, because that’s not the approach that we take.

We take the approach that the middle class — the bulk of the population, those earning the vast majority of the personal income in the province — deserve a break every bit as much as, if not more than, those at the top end of the scale, because those at the top end of the scale have resources, too, that they can use to cushion the blow of a slightly increased tax.

[1455]

That decision is not included in the Budget Measures Implementation Act, but it could be. It could be. It’s a deliberate choice not to put it in — a deliberate choice. Those are their values. That’s who they think they represent, and that’s why we oppose it.

There are really many other measures which, as the process unfolds, the very capable critics, my colleagues, will analyze in some detail, and there will be a detailed debate at the next stage of the legislation.

I do want to make a little bit of comment about the film tax credit. Certainly, the Minister of Finance today was expressing his consternation with the tax and talking about changing it.

What our critic, the member for Vancouver–West End, has said is: “Just wait a minute. Just be careful. Be very

[ Page 10737 ]

careful.” This is an industry that’s survived, is thriving right now. Certainly, the exchange rate has contributed to that. The exchange rate with the American dollar is very favourable. But to begin tinkering and manipulating that credit could have some profound implications for an industry that’s doing very well. That’s certainly something that we on this side of the House advocated for before the last election.

I remember the Minister of Finance standing up and attacking a credit for Hollywood producers. He was — I don’t know — playing some kind of a parochial or nativistic or…. I’m not sure what he was doing. He had some reason, clearly. Or maybe he didn’t. But he was attacking Hollywood producers and making fun of Los Angeles.

These are the people that fly up here, two hours away, come here and invest money, use the very skilled crews and the post-production facilities here and make hit movies that are distributed around the world. Many, many people in British Columbia benefit from that, and government revenue benefits from that.

Maybe there’s a little residual taste of that point of view on the film industry. I’m not sure. I’m sure that…. Of course, the minister has access to the House, in his rebuttal. I’m hoping he’ll come here and explain what he meant and whether he has that kind of anxiety or distaste for American film companies.

We’ve just heard the member for Cariboo-Chilcotin talk in very pointed terms about alleging hostility to foreign investment by those of us on this side of the House, yet I recall very clearly that it was the Minister of Finance who was attacking Hollywood producers in Los Angeles, the Los Angeles–based film industry. You can’t have it both ways, although that’s kind of the way the government likes to have it on issues like this.

Because these measures implement the budget that I don’t support, I want to make it very clear, if I haven’t already, that I’m going to be opposing this bill, and I look forward to the committee stage, where we’ll dive into some of these issues in more detail.

G. Kyllo: I’m proud to stand today, on behalf of my constituents of Shuswap, and speak in support of Bill 10, the budget implementation act.

British Columbia didn’t become the shining national example for good economic stewardship by chance. It’s a result of the government having a steady, disciplined eye on our dollars and cents. It’s a result of cultivating and promoting a highly diversified provincial economy, an economy that is able to withstand the many global market forces that are beyond our control. With a diverse economy and diverse export markets, B.C. is protected from downturns in any single sector.

This is our fourth consecutive balanced budget, and I feel great about that, as do many British Columbians. We truly have reason to be proud. It’s what can happen when a government sticks to a plan, combined with the hard work of British Columbians. Investments in areas such as health, education, social assistance and services would not be possible without the healthy and diverse, stable economy that B.C. enjoys today.

I represent what would be defined as a rural riding. My riding is Shuswap — largely tourism-based with a fairly heavy forestry- and manufacturing-based economy.

[1500]

Shuswap has no cities with a population over 25,000, which means that every community in my riding can now benefit from the rural dividend program, which will pour up to $75 million over the next three years into rural communities to help reinvigorate and diversify their economies.

This budget is supporting rural B.C. in several other ways as well. We are protecting communities and citizens by setting aside $85 million to establish a new organization, the Forest Enhancement Society of B.C., that will work toward wildfire prevention and mitigation through forest fuel management, reforestation and habitat restoration. There is $10 million for the strategic wildfire prevention initiative for community wildfire protection plans, FireSmart planning activities and fuel management projects.

Tourism is a major industry in the Shuswap, and for those who provide tourist accommodation in the Shuswap and across B.C., there will be an enhanced property tax relief program.

Agriculture also is an extremely important part of the economy in the Shuswap. There is a new farmers food donation tax credit that is worth 25 percent of qualifying agricultural products that are donated to a registered society or charity providing food to those in need or help with a school meal plan. Additionally, the farmers food donation tax credit is worth 25 percent of the fair market value of qualifying agricultural products.

I spoke earlier about our diverse economy. We also have tremendous diversity in international trade. Our attractive fiscal climate, business incentives and diversified economy offer significant opportunities for growth and investment in our trade relationships that have had a great impact on the growth of family-supporting jobs across B.C.

That is why we are committed to expanding and diversifying our markets through overseas trade missions, growing our trade and investment network, and working on new partnerships and MOUs.

Diversification of markets is a priority for our government. For example, in 2001, a little over 70 percent of B.C. exports went to the United States. In 2014, exports to the United States made up just 50.6 percent of total exports, with 39½ percent of exports going to markets in the Pacific Rim.

If I can draw the comparison to our neighbouring province of Alberta and, a little bit farther east, Ontario, about 90 percent of Alberta’s trade is with the United

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States, and in Ontario, about 80 percent. It’s certainly important to recognize the fact that the U.S. is still our single-largest trading partner. It still has a very significant impact to growing the economy of this province. But we are not as reliant on the economy of the United States as other provinces — like Alberta and Ontario, for example.

Now, while we continue to diversify B.C.’s markets and export to the U.S., we are still growing. Wood exports, for example, were up 62.8 percent last year alone. Since 2011, B.C.’s exports have increased by 9½ percent. Since 2009, B.C.’s exports have increased by over 42 percent. Right now one in five jobs and 20 percent of our annual economic benefits are generated through exports.

In 2014 alone, exports accounted for $35.8 billion, a record level of exports, which was an increase of 6.3 percent over 2013. Manufactured goods accounted for just over 64 percent, or $22.8 billion, of the total value of exports.

As of May 2015, the exports of British Columbia’s goods totalled $8.77 billion, which is a 4.1 percent increase over the same period in 2014. All these numbers are upward trends and definitely signify the fact that B.C.’s economy is continuing to grow.

Our government is focused on building strong relationships with Asia. We’re using the B.C. Business Network and our expanded international trade and investment network to connect export-ready B.C. businesses with opportunities to find new markets for their products. So 43 percent of all trade flows to Asia, which has grown at a rate of 19 percent over the last ten years.

In March 2013, we hosted the B.C.-India Global Business Forum, as part of our long-term economic and outreach strategy with India, to discuss investment opportunities, profiling key sectors of mutual priority.

Over the course of ten years, British Columbia’s exports with China have increased by 375 percent. Last year China ranked second, behind the United States, for B.C. exports, with almost 17.7 percent of B.C.’s commodity exports being shipped there.

Overall, goods exports to mainland China were up 1.3 percent in 2015 compared to the same period in 2014, with $1.5 billion in exports. Indeed, we’ve developed new markets for our goods, and we’ve also bolstered our presence in existing ones. Diversification and fiscal responsibility have been the keys to British Columbia’s economic success story.

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We believe balancing the budget is a matter of fundamental respect for the taxpayer. We’re not to spend more in any one year than we take in. We believe in extending the necessary supports to British Columbians who are in need of them most, whether they’re the young, the elderly or those in between.

Fiscal responsibility allows us to spend on the social programs British Columbians expect and deserve. Our direction is clear: by sticking to our plan, we are building a stronger British Columbia for today and for years to come. This is why I’m extremely proud to support Bill 10, the Budget Measures Implementation Act.

A. Dix: It’s always good to get up in this House and speak to government initiatives such as this. As my colleague from Surrey-Whalley so thoughtfully…. I think he’s wrong. I want to say to him, because he’s here sitting beside me in the House, that he’s wrong. My understanding is that every time he gets up to speak, the ratings go up. That’s my understanding.

One of the reasons for that is people — from around the buildings here, especially — turn up the volume, turn off the mute button and listen carefully to what he has to say. What he had to say was thoughtful and, I think, cut through, in rapier-like fashion, the fallacy of, for example, what the Minister of Transportation said in question period. That is, quoting skillfully…. It’s someone that the Minister of Transportation will be familiar with, because of course, he was one of those people in the buildings. I know that whenever Gordon Campbell spoke, it was mandatory to have the volume on loud in the Liberal research office in the 1990s.

My colleague from Surrey-Whalley amiably pointed out what is obvious, which is that we oppose the budget not because we oppose every line item in the budget. That would be ridiculous, and yet it’s regularly asserted on a daily basis by the Liberal cabinet, which should know better. But the vote on the budget is a general vote of confidence in the government and on the government’s economic and social direction. We, of course, voted against that. I have to say that in ten years in the Legislature, this was one of the most out-of-touch, empty and self-absorbed budgets a government has ever produced. So naturally, we voted against it.

Now, Bill 10, the Budget Measures Implementation Act, puts into legislative form some of the initiatives in the budget. The government didn’t need — and I think people out there will be interested in that — the Budget Measures Implementation Act to continue to make the tax system more regressive by jacking up medical services premiums. They didn’t need to use this mechanism built in the Budget Measures Implementation Act to do that.

They were able to do that and to contradict what the Premier had said, even in the weeks leading up to the budget, all on their very own, without legislation. They didn’t need the Budget Measures Implementation Act, for example, to claw back bus passes from people with disabilities. They didn’t need this mechanism. Only the mechanisms that require legislative change are included here in the Budget Measures Implementation Act, which we’re talking about.

The signature event in the budget, the signature moment for the government…. I know this because, unlike some members of the Legislature, I read the throne speeches. I keep them in a place, because I know that

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somebody at GCPE worked hard. Their budget has gone up quite significantly, so we want to see if we get value for money from that. That’s the government communications branch.

If you’ve been reading the throne speeches and the political pronouncements on which every Liberal member of the Legislature ran in the last election…. What we’re talking about here — the creation of an LNG fund — is the signature measure, the signature priority, of the Liberal government. That’s what they said.

They said things like “$100 billion.” They said things like “get rid of the provincial sales tax.” They said things like “retire the provincial debt” — as a result of the LNG policies of the government. That’s what they said. That’s what they promised. That’s what they committed to.

[1510]

This fund was going to be the signature piece, the mechanism by which this happened. It was the fund that…. It’s contained here in Bill 10.

I want to say this in a way that I think people can understand. What they were like, is like a concert promoter who tried to sell 100,000 tickets to U2. Then on the day of the concert everyone goes to the concert, and they’re very excited, and K2 shows up — a well-known U2 tribute band. That is what we have here.

Alternatively, if you’re a fan…. I know that the member for Kamloops–South Thompson is a fan of the WWE…. It’s like getting a ticket, being sold a ticket by Vince McMahon and showing up and expecting to see the Undertaker, and the Underfaker comes through the curtain. This is precisely what it is. Or buying a book on cooking — which I’d be interested in — and expecting and thinking that you bought a book by Julia Child, and it turns out to be a book by Fred Child.

It’s a little like…. We’re talking about the Liberal government, so I think I was giving them too much credit with the U2 thing. It’s like showing up for an Air Supply concert and getting, instead of that, Air Deny. An Air Supply tribute band — I am sure one exists. And if it does exist, I am sure the Minister of Transportation has seen it. Oh, I could reflect on Jerry Grisham and the famous mystery writer Annette Christie — any other things that you can think of.

What they promised…. And this was their signature promise. It was in every leaflet, it was on their TV ads, and it was on the side of the bus. They promised a fund from LNG revenue that was going to do all of these things. And today, as the signature piece in the Budget Measures Implementation Act — the signature piece — we get this. No revenues from LNG — none. They’ve created a phony, fantasy, photo-op fund. That is what they’ve done.

They have so little respect for the voters who listened to them in the last election — and not everyone did listen; half the people did, but lots of people didn’t — and so little desire to be straightforward that they created the fund anyway.

This is the day, the day we’re debating this, when AltaGas said they weren’t going to proceed with LNG in British Columbia. You would think that that action would have some effect on the LNG fund, the Premier’s fund — her signature achievement. But ironically, it has no effect. That not going ahead has any effect…. This fund has nothing to do with LNG revenues. It comes about, it’s delivered, as a creation, a figment, a tribute band to a real fund by the Minister of Finance — the Colonel Pepper of the government, perhaps. He, I must say…. You know, they almost get it right. We were looking for Sergeant Pepper; we got Colonel Pepper.

He has created a fund that doesn’t exist. They put $100 million in the fund, and where’d they get the money? Well, they got it by overcharging hydro customers with a phony tax increase. They did it by overcharging ICBC customers, and we’ll be getting to that in a sec. They did it by increases in MSP premiums.

So this is a regressive tax fund that they’ve created — a regressive tax fund that’s created solely for public relations reasons. There is no purpose to its existence. There is nothing the government can do tomorrow that it couldn’t do today because of the existence of the fund. The sole reason is that the Premier and the Minister of Finance are embarrassed that what they said — not 100 years ago, not when the Premier was Deputy Premier in 2002, but a couple of years ago — has proved to be absolutely wrong because, as you know, international markets affect these things.

The suggestion — and it doesn’t matter how relentlessly you use government ads and partisan ads to advertise it — that there is a real impact by international markets….

[1515]

My colleague from Surrey-Whalley ably, even brilliantly, laid out, I think, the circumstances, the realities of the LNG market internationally. And rather than…. This fantasy fund exists in this piece of legislation today from the government for the sole purpose of allowing them to claim there is a fund, to claim income when none exists already.

They maybe got the idea from their B.C. Hydro policy over the last number of years, where they have used, systematically, deferral accounts to create the illusion of profit where none existed so that money could be transferred in the government’s balance sheet to look artificially good — that they could use such measures to increase and to jam ICBC and B.C. Hydro customers to subsidize the government’s actions.

This is the principal measure in this Bill 10. This is the signature moment in the budget. Rather than being straightforward, they were not straightforward. This is the result of that. They would rather not admit that what they said two years ago has turned out to be completely wrong and misleading. It would raise, I think, the suggestion as to whether they knew at the time that it was completely wrong and misleading. That’s the issue that’s being raised.

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Here we have this contrivance, this $100 million contrivance, that is the government’s priority at a time when it’s clawing back bus passes for people on disability and not taking action to support, in any substantial way, rural communities. You know what they have for rural communities? They have a fund for $75 million over three years. It’s $25 million in the next three years, smaller than the Premier’s fantasy fund. That’s all they have at a time when rural B.C. is struggling with those very same losses on the commodity side.

The only thing they care about is the effect of commodity prices on the Premier’s reputation and not in rural B.C. That is what has occurred here. That is what we are debating, and that is what we are voting on in this House.

It shows a disconnect between the reality of British Columbians, including the thousands of jobs lost in forestry and the thousands of jobs lost in mining, and the government and its concerns. Commodity prices have also hurt those people who’ve lost their jobs. They’ve hurt those people, and they get nothing from the government, while the Premier digs out $100 million for this charade. It’s an embarrassment to British Columbia, and it should be an embarrassment to the government.

There are other, of course, measures in this. I’ve been asked by my colleague who is leading the discussion on this bill, my colleague from Victoria–Beacon Hill, the Finance critic for the NDP, to speak a little bit about the issue related to ICBC. I know that the minister is here in the House. I am looking forward, I must say, to discussing these issues at great length with him, both in the several days of committee debate that I would expect to have with him on this question and then, of course, in the estimates debate following.

That is, of course, that the government is proposing to change ICBC’s fiscal year, which will now end on March 31 instead of December 31, and making changes to when it produces its annual report. This is an interesting question, this question of ICBC. I’ll get to the specifics of why it’s significant that the government is choosing to change the date of the fiscal year and the timing of the fiscal year. Strangely enough, people may not realize this. I’m, of course, here to learn all the time.

ICBC, in fact, operates on several different years, depending on how you look at their books and how you look at the way they function. There are really three types of years. They have kind of a policy year, an accident and sort of statistical year, and they have a fiscal year. This one changes the latter.

The interesting thing, I suppose, about ICBC, and the extraordinary thing — people will know this; I know, hon. Speaker, that you’re well aware of this, as an experienced member of the Legislature — is that ICBC was the creation of the NDP government of the 1970s — the Barrett government. Its creation led to occasional demonstrations against the government.

[1520]

I recall it well, actually, because my dad — and some people will know this — was an insurance agent. He ran his own business. He was, I think, in that case, one of the 1 percent — the 1 percent of insurance agents who supported ICBC at the time. There was a very intense debate and, I recall, a very intense time when he spoke out about that at a public meeting.

It was very interesting what happened, of course. In spite of all the criticism of Mr. Barrett, who was the Premier, and of Mr. Strachan, who interestingly was a former leader of the NDP who became a cabinet minister in the Barrett government and who was the minister responsible for ICBC…. Of course, the Social Credit Party and the Liberal Party and the Conservative Party of the day viciously attacked the government around the question. It is a fact that since 1975, when the NDP government left office….

For a majority of those years, alas, there have been right-wing governments in B.C., and none of them have chosen to get rid of ICBC. I think it shows how farsighted the initiative by the Barrett government was.

I’m reminded of one of the most enjoyable speeches, of the many enjoyable speeches, by Dave Barrett in the Legislature. He talked about this. He talked about the Social Credit government’s decision, ultimately, to proceed with ICBC — and basically in the form, at that time, that the NDP had left it.

Barrett said as follows:

“I don’t have too much to say on ICBC, other than to say that those raving socialists over there have gone too far. They have expanded the program to a degree that is shocking even in the Soviet Union. They have embraced government-owned car insurance as if it was their own child, and as foster parents, they have denied all maternal and paternal responsibility. As one who has suffered from vindictive slings and arrows of mad opposition who scream doom and gloom about the government insurance business, let me say with some humility: welcome to the socialist club.”

Of course, through those times, ICBC has been critical in British Columbia, both for providing access to auto insurance, pursuing a public initiative of road safety and — especially in recent years, where the government used it as a cash cow — a significant source of positive revenue and capital for the government.

These were important things that occurred. Really, ICBC, until 2010, functioned in that way. There’s a very thoughtful thinker on these questions. Richard McCandless is a former public servant who writes in B.C. Studies and other things about public policy issues. He talked about what happened.

In 2010, of course — and this directly relates to what we’re doing today — the Liberal government, under then Finance Minister Colin Hansen, who we occasionally hear on the CBC these days, speaking for the government…. I’m quoting Mr. McCandless’s piece, a very thoughtful piece about the history of ICBC. He confirmed that the government, over three years, in 2010 “would take $778 million of ICBC’s ‘excess’ capital from

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the optional capital reserve as a dividend in order to reduce provincial borrowing costs. During the 36 years of its operation, most citizens had regarded the corporation as a not-for-profit supplier of low-cost insurance similar to its predecessors in Saskatchewan and Manitoba. In fact, the legislation did not permit a transfer of its funds to the government. Henceforth, any reserve capital greater than the optional MCT target would be considered as a dividend for the benefit of the taxpayer rather than a way of reducing premiums.”

We’ve heard this a little bit in the House in the last week from the minister responsible for B.C. Hydro. I’m sure we’ll hear it when I discuss it with the minister responsible for ICBC. They criticize past governments for keeping rates low — in other words, for returning B.C. Hydro’s profits to citizens, returning ICBC’s profits to citizens —

whereas their approach has been to bring them in so that they can finance tax cuts for the rich. They’ve compared those approaches.

I like that comparison. I look forward to those debates. It seems to me that what’s happened is we’ve transitioned ICBC into playing its role as a Crown corporation, in all of the ways it’s going to do, to a role of simply saving the Liberal government at election time.

You will recall — and I mentioned this, for example — that the policy year of ICBC, which is an important question, was changed in 2013. Now get this. If you remember, 2013 was an election year, as 2017 will be. They changed the policy year from April to November. Why would they have done that?

[1525]

The member for Vancouver–Point Grey, very thoughtful on these questions, can reflect on the year and when elections are held. There are actually fixed election dates in B.C. He can probably advise me as to when elections are held and why they might have moved the policy date, the policy year, from April to November at that time. They did it, of course, for only one reason: to cover up and to hide the truth from the voters of British Columbia. That’s why they did it.

Now we have a policy year, November, and now they’re moving the fiscal year to cover the fiscal year of the government. This has some challenges, right? As you know, the policy year used to be a couple of months ahead of the fiscal year and ten months after the close of the last year. This is when we were setting rates. It’s now five months ahead of the fiscal year and seven months after the close of the prior year.

This means that the estimations that the government makes will be less precise. It has an advantage, of course, and these are issues we’ll be discussing in the two or three days of debate I’ll be having with the minister at committee stage. It has some advantages in terms of moving the fiscal year in line with the government’s fiscal year. But it does have some disadvantages for ICBC, which I think will be considered. One of the most important disadvantages is that over time, over its decades of operation since the early 1970s, they’ve operated on one round of fiscal years.

Now, magically, going into an election year, we’ll have the opportunity to do it over 15 months and make comparisons much, much more difficult, which, when you have a terrible record, is a good thing, I suppose. That’s why the Liberal government may be so encouraged to go forward at this time. When you have a good record, that would be a bad thing. We’ll guess whether the record is good or terrible by the action that the government is taking.

What’s happened at ICBC, and what happened this past year, is surely a profound lack of accountability. What we saw this past year is the minister…. We had what we call sort of a political operetta starring the minister. Maybe more like — I don’t know — Joe Verdi instead of Giuseppe Verdi.

In any event, to continue our theme, where the minister pretended in August that ICBC was proposing outrageous rate increases beyond this and he was going to wrestle it to the ground…. They’ve tended to wrestle it to the ceiling. He was going to wrestle it to the ground. He was going to get his pencil out and his abacus out. They got rid of all the computers in his office. He was going to wrestle those rates to the ground. You know what he did? He didn’t do anything of the sort. In fact, their management of ICBC has seen costs go up dramatically overall, and they are doing a whole other song and dance to justify that.

What he did was take from the optional side of ICBC, not reviewed by the BCUC, of course. He took $450 million and gave it to the basic side. That was his reform. That was his pencil work. He was able to say: “You do this. Take it over here. Then I will have brought the rate increase down.” That is the reform that was brought in by the government, five years after the previous reform, which changed the whole basis and mandate for ICBC, and three years after the other reform around fiscal years that allowed them to hide the situation through the 2013 election.

Now we have a new process, a 15-month fiscal year, to make it more difficult to hold them accountable. I think we’re still going to try, I say to the member for Surrey-Whalley. I think we’re still going to try. The upcoming days of debate on this bill will give us our first opportunity to consider doing just that.

In conclusion, what do we have to say about this piece of legislation and this government’s budget? That it’s out of touch with the people of B.C. could not be clearer. The small actions with respect to the housing market ignore the significance and challenge of housing facing every group of people in Metro Vancouver and in other parts of the province as well. It’s a budget which fails to recognize what’s going on in rural B.C., the income challenges people face in rural B.C.

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We hear the government bragging about long lineups of people, lining up for work. That tells you something. The government’s own budget numbers dramatically reflect the decline, in relative terms, of the resource industry as a source of revenue to the government — a dramatic decline. Virtually, as a share of the provincial budget, a quarter of what it was before, a dramatic decline in those industries.

[1530]

You cannot hide that. You cannot say, “We are the resource industry government,” and then see that kind of decline, which reflects a double whammy for rural and resource communities that have lost services as a result of that decline and have also lost jobs as a result of that decline. You respond with a three-year slush fund around an election that is $25 million smaller than the slush fund they created for the Premier personally. Out of touch with what’s going on.

Out of touch on the issue of MSP which, though it is not in this piece of legislation, hovers over this piece of legislation because it finances the key item, the Premier’s fantasy fund, in the legislation.

All of these things show why members on the opposition side voted so clearly against a budget from a government that’s out of touch, that is more used to dealing with deputy ministers and receptions and satisfying elite concerns than dealing with the concerns of real people.

You see that reflected in this piece of legislation. You see it reflected in the direct actions the government is taking and not taking. And you see it, I think, in the arrogance and contempt that the government expresses to those who simply disagree with it.

We will look forward to continuing this debate extensively at committee stage. But in closing, I want to say this — that this is not the way you do things. You, I think — we, as legislators — have an obligation to treat the public with respect. When there is not LNG revenue available, you don’t create a fund and pretend that there is.

There was a fund created at the end of the 1980s, in the declining days of another government. It was called the budget stabilization fund. Its acronym was the BS fund. That fund was an example of a government, a right-wing government, that had run out of ideas and had lost touch with the people of B.C. — an example of what not to do. And it was rejected by people.

Thankfully, the government that came in after it got rid of the BS fund. This fantasy fund has no more real money in it than that BS fund. It has other commonalities with the BS fund, but the commonality is not money in the fund.

This reflects the same thing: a government that is playing fiscal games rather than being clear and straightforward with the people of B.C.

Hon. S. Thomson: I’m pleased to stand and provide comments on the Budget Measures Implementation Act and support for that act, which implements the fourth balanced budget in a row that our government has tabled, building on the strong fiscal environment, continuing to maintain the triple-A credit rating and a fiscal framework that has created over 50,000 jobs in the last year.

I was listening to the member opposite and listening to his analogies and things, and I was just waiting for him to acknowledge the significant growth in sour cherry exports in British Columbia, from $2.7 million to $11.2 million. I thought he might get to: “Can she bake a cherry pie, charming Billy, charming Billy.” I just thought we were going through all those….

Interjection.

Hon. S. Thomson: Yeah. When we think about those cherries of our youth and all the sour cherries and the significant growth we’ve had in the Okanagan in that…. That’s just a bit of a digression.

I wanted to talk about a couple parts of the Budget Measures Implementation Act that are contained in these sections, and particularly in relation to significant measures that have been taken in the area of community safety and investments in rural economies and rural British Columbia.

[1535]

Within the Budget Measures Implementation Act and with amendments that have been made to the Wildfire Act, which is contained in this

section within the legislation, we now have the opportunity and the ability to make significant investment in community safety and communities.

When you take this investment of the $85 million that has been provided to the forest enhancement program, the FEP, and to the Forest Enhancement Society, this is going to provide community safety, additional jobs in communities, reducing risk around the province and providing additional fibre opportunities in those communities and, while that is undertaken, looking at elements of developing wildlife rehabilitation and ecosystem restoration as part of that commitment. The Budget Measures Implementation Act provides that opportunity.

When you couple that with the $75 million that is invested in the rural dividend fund in communities and you couple that with the $5 million in the budget that is continuing to be invested in market development and growing market opportunities for the forest sector and you combine it with the additional investment in our land-based investment program in the budget….

All of these, along with the $10 million that has been added to the strategic wildfire prevention initiative through UBCM, which is dealing specifically with the interface in local government jurisdictions and the programs that they are running….

Those continued investments, over $120 million investment in continuing to build on community safety,

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on forest health — building those opportunities that will create those opportunities in local governments and rural communities around the province….

I know, in discussions with UBCM and in discussions with our rural advisory committee, which has provided significant input and advice into the development of the rural dividend program that we will be providing more details on in the coming weeks and months as we implement that program for this year, it’s going to provide those communities with those opportunities to help continue to diversify and build their local economies and create jobs in those communities. That will be the focus of the program.

The forest enhancement program, which will build on community safety, reducing wildfire risk across the landscape, is again another very, very significant investment that has been facilitated and provided for by the fact that we have the opportunity. We have the balanced budget, and we have the ability to make these strategic investments in our communities.

I hear the members opposite focusing on the fund. I think that the reality is and what people need to realize is that if it was the members opposite, we wouldn’t even have the opportunity to talk about these investments because of their continued opposition to major projects, because of their continued opposition to significant infrastructure investments in the province — all of those.

We wouldn’t even have the ability to look at those kinds of investments if we had that continued opposition to projects and to responsible resource developments in the province.

One of the things that the balanced budget does, and the measures that are in the Budget Measures Implementation Act, is provide those opportunities for investments in our communities as well.

In the Okanagan, in Kelowna and in my riding, we have seen very, very significant benefits and opportunities that come from a strong fiscal environment in the province, whether that is in the aerospace sector, whether it is in the agrifoods sector, whether it is in the technology sector in our communities.

As you know, the Okanagan and Kelowna, in particular, is developing a real innovation hub and growing technology sector in our community that is creating jobs, bringing new investments into our community.

[1540]

We are seeing go up, as we watch it daily, the new innovation centre in Kelowna, helped by a $7 million investment from the provincial government in building that innovation centre, creating that hub through Accelerate Okanagan. There is tremendous excitement and opportunity in the community for that sector.

We know the growth we have in our agrifood sector, the significant increases in agrifood growth. The Okanagan is seeing the benefits. We’ve seen the tremendous increase in cherry exports that have resulted in huge opportunities in our community.

I know that orchardists and growers like Dendy Orchards, David Geen at Coral Beach orchard, Jealous Fruits and the Sun City orchard in my riding are looking at those opportunities in those new markets. So 13,600 tonnes — a 56 percent increase and $91.7 million in value. You add that to the sour cherry exports that have gone from $2.7 million to $11.2 million, as I talked about.

Growers in our region are excited and really looking forward to continued opportunities in that area, which are provided by the strong fiscal platform and environment that we have here in British Columbia.

Just recently we had the opportunity in our community to attend the grand opening of the fourth floor, the new perinatal unit, in our hospital, building — a very, very significant investment that has been made in our community. We had the chance to tour that with expectant mothers and others who were looking forward to that new centre opening, providing that great place for bringing into our world the next generation, our children.

It was interesting talking to some of the expectant mothers, who are now saying: “What’s the exact date? Can I hold on and just make it past that official opening date so that I can have all of these facilities and this new great place to bring my son or daughter into the world?”

That’s compared to the older, less desirable place, I guess. Although when you look at the staff, the care and the support that they get, with the nurses and everybody there, it is tremendous. But to see this great new facility, it is, as they talked about that day, the icing on the cake with that top floor and all the investment in the hospital.

We have investment in Okanagan College, with trades training — 513 additional training seats, $28 million under the B.C. skills and training plan, expanded and renovated trades-training facilities. This budget and the measures that are in the budget implementation act continue to provide for those additional investments in skills training and post-secondary facilities, helping build the capacity in the province.

We have the fastest or — they always argue a little bit — ninth-fastest-growing airport in British Columbia, building a hub in Kelowna, servicing residents and businesses in the Okanagan. It is second to none, with the investment. That is all because people are excited, continuing to look at building the growth and the opportunities in the province.

All of this investment in our highways, the widening of Highway 97 from Highway 33 to Edwards Road, is, again, a significant part of the Ministry of Transportation on the move in British Columbia.

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All of these opportunities and all these investments that we can make provincially and in our communities are enabled by the sound fiscal plan, by the balanced budget that we have, by the continued focus and discipline on spending that is the hallmark of this budget and which is enabled by the measures that are in the Budget Measures Implementation Act. They implement import-

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ant components of the budget that help continue to build jobs and economic growth in the province.

I just did want to comment a little bit, and I know that my colleague from Kelowna–Lake Country, the Minister of Agriculture, will probably comment on it as well. One very important piece of the measures in the budget implementation act is around the ability now for the tax credit for British Columbia’s farmers who donate to food banks, to non-profit organizations. That was announced today to provide that additional flow of agrifood products to those food banks and to those non-profit organizations in our communities.

I know it is something that the agriculture industry has been looking for, for some time, and it is going to provide a significant benefit to those organizations who do so much great work in our communities in bringing fresh, local and healthy foods as a component of their work, and to provide those opportunities for farmers.

I know farmers around the province who are great, caring people. To be able to have this opportunity to provide additional support to those organizations, I think, is a very, very positive element of the Budget Measures Implementation Act and the legislative pieces that are part of this bill, Bill 10.

I was pleased to stand in support of Budget 2016 for all of the reasons that were outlined. I am also pleased to stand and support Bill 10, the Budget Measures Implementation Act, that implements important components of Budget 2016, and continue to build on that legacy of balanced budgets, of triple-A credit rating, of providing growth and economic opportunities throughout the province and the role that our ministry plays in contributing to that objective and that goal as well.

D. Eby: It’s an honour, as always, to rise and represent the community of Vancouver–Point Grey in this Legislature and on Bill 10, the Budget Measures Implementation Act, 2016. I bring the community’s thoughts to this place about the government’s initiatives around priorities that my constituents are concerned about.

There was a meeting last night in my constituency about public education. I wish the Education Minister could have been there with some of the answers he gave today in question period to explain some of the elements here of Bill 10 and some of the pieces that were missing, from the perspective of the parents. They are very concerned about increases in class size; about kids with special needs not getting the supports they need to succeed in our schools — those schools that need seismic upgrading; about schools that have some serious challenges because they aren’t being maintained the way they should be due to dramatic cuts that this government has implemented in these budget bills.

You don’t get 200 parents into a room on a school night if there’s not an issue. That’s what happened last night. The tone-deafness of this government and this bill to the concerns of those parents and other concerns that my constituents and people across the province have is quite astounding. I think the member for Vancouver-Kingsway and the member for Surrey-Whalley articulated those concerns very well. It was an honour to hear their speeches and the way they represent their constituents.

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I’d like to really start and focus on the housing issue, though. I was asked to focus on this by my colleague from Victoria–Beacon Hill, who led us off here, and I think she’s right to ask for that. We were told that this was the housing budget, and therefore, this was the housing budget measures implementation act. So the government deserves a review of what’s coming back after they have announced this so-called historic housing budget. I say it with a laugh, because it is anything but.

I’m going to start with a letter that was sent to my office today. This is someone who is paying attention to the housing issue in the province, certainly in Metro Vancouver, and who is paying attention to the government’s announcements around housing and their response to housing. I think it illustrates perfectly the failings of this government and this bill to address the housing crisis we’re facing in this province. I’m going to quote directly from the letter:

“I am a 38-year-old mother of two, and I work as a special needs assistant. I am incredibly fortunate that I have a job that I love, two healthy children, and I live in cooperative housing that is stable — at least until the land lease runs out. Without my co-op, I wouldn’t be able to live here, because according to some property owners and dubious politicians, I don’t ‘deserve’ to live here. Many, many people I know are far less fortunate, and I am seeing more and more people in my income bracket surfing couches or moving in with their parents — the ones that stay in the city, of course, since the rest have left.

“As you know, there is a collective desperation here, as people are pushed out of housing or unable to find it, either to buy or to rent. And since no one I know has even thought about a detached home, we won’t even go there.

“I’m curious as to how this situation is affecting the mental health of the residents of this city, since this seems to be a no-win situation for anyone that actually lives here. I really don’t believe that most homeowners would take equity over empty neighbourhoods, their adult children’s well-being and Airbnb rentals in their building; I just don’t. The thing that actually makes this a great city is that people here are generally decent people, I believe.

“I’ve been thinking about taking my kids out of this city in order to raise them away from a place that seems determined to drive itself as fast as it can into the ground. This city seems like it is infected with a greed that I can’t understand.

“The thing is that if it is sick and this is some kind of illness, it is treatable. In the last couple of months, there has been an incredible amount of data and information telling us what we all know: it doesn’t have to be this way.

“I have been living here for all of my adult life. I moved here when I was 18 years old, on my own, and it really wasn’t that hard. I have always lived in very modest accommodations, but I haven’t ever had trouble acquiring them. I know that with the available stock that we have in this city, people today could have the same situation, were the stock made available.

“No one that I know wants the big house and picket fence. They just want to stay in the city that they have been contributing to and have grown up in. I truly believe that to be a possibility, but it would take government intervention.”

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This bill, this budget, provided the opportunity for that government intervention. It’s not just, as the members across the way say, a few neighbourhoods in Vancouver or just Vancouver or just Metro Vancouver. This is an issue that raises its head in many different ways, in many different communities, across the province.

Let’s start by what’s not in this bill but should be there. We’ve learned about shadow flipping and rampant speculation driving up the price of housing across Metro Vancouver. Now, the government apparently believes that the existing Property Transfer Tax Act does not enable them to tax these shadow flippers each time they buy and sell homes like they’re penny stocks on the old Vancouver Stock Exchange.

Keep in mind that property transfer tax is a tax that the government feels perfectly comfortable charging to families trying to buy housing in the province. A hard-working family buying an older home or townhome or condo — you pay the tax.

But if you’re a shadow flipper, profiting off driving prices higher and higher in our market, does the Budget Measures Implementation Act say that each time you flip a family home, making it less affordable for people who live and work in Metro, you have to pay the tax too? No, it doesn’t. It doesn’t close this loophole at all — a loophole that could be costing government tens of millions of dollars that could be put back into affordable housing.

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Now, keep in mind that this government believes $50 million is an historic investment in housing. Imagine what they could do if they taxed these shadow flippers and put that money into affordable housing and rental housing in this province.

That’s not the only loophole in our property transfer tax that speculators and wealthy international investors are taking advantage of while everybody else has to pay this tax out, on top of out-of-control real estate prices. The government is aware of this loophole. In fact, in this bill, they say they’re going to study it. They’re going to collect data on it.

Keep in mind that this loophole has been notorious for decades. It’s called the bare trust loophole. The way that this works is you don’t actually sell the property; you just transfer what’s called the beneficial interest of the trust. You need a lawyer to help you do it, but if you do it this way, you don’t have to pay the property transfer tax.

That’s why we had a German billionaire buy the Royal Centre in downtown Vancouver for a couple hundred million dollars and not pay the property transfer tax. That’s how a group of Chinese investors just bought all four Bentall towers for hundreds of millions of dollars — some speculate as much as $1 billion dollars — and they, too, won’t pay the property transfer tax. On these two transactions alone, this government left $20 million on the table — while this bill that they’ve put before us proposes that they continue to study the issue.

Keep in mind that these are just two transactions of the many commercial real estate transactions that take place across this province — hundreds of millions of dollars. And this government thinks $50 million is an historic investment in affordable housing, while they leave hundreds of millions of dollars in forgone property transfer tax revenue on the table that could be put into affordable housing. Imagine what they could do if they taxed these international investors the way they should.

Now, there’s been a lot of ink spilled about a different kind of international speculation in our real estate market — in our residential market, including in our agricultural land market and in housing in Metro Vancouver.

This bill speaks to that issue. It proposes that rather than act to control this international speculation in our housing market, we put a new check box on a form that people can check if they’re not a resident so that we can continue to study this issue.

The concern that people have is