Official Report of

DEBATES OF THE LEGISLATIVE ASSEMBLY

(Hansard)

TUESDAY, APRIL 22, 1997

Afternoon

Volume 4, Number 3

[ Page 2711 ]

The House met at 2:05 p.m.

G. Robertson: With us this afternoon in the House are Chief Bobby Joseph, Chief Bill Cranmer, Chief John Smith, Chief Ralph Dick and Chief John Henderson; Bill Wasden, a manager; Richard Dawson, a councillor; Molly Glendale, a councillor; Tony Roberts, a councillor; and Warren Lewis, a band member from Cape Mudge. Scott Harris and Shawn Morford are technicians with the tribal council.

Also with us this afternoon, we have the Campbell River Christian School and Mr. Wayne Demerse, the teacher. My understanding is that there are approximately 13 to 15 students and a number of adults accompanying them. I would like to ask that the House join me in welcoming all these North Islanders here this afternoon.

V. Anderson: Today we have in the House Gwynn and Norm Ellis from the Vancouver-Langara constituency -- very active volunteers in community activities, in the Cancer Society and in adult drug education service.

J. Sawicki: As you all know, it's Earth Day today. It's the day we remind ourselves that we share this planet with millions of other life forms. And to celebrate the progress we've made in the past five years in this province, I was pleased to have lunch with two young women who are here from Glenlyon-Norfolk School. Their names are Laura Knogler and Lauren Zolpys. Together with their fellow students, they completed an incredibly ambitious project called Ocean World. They turned their whole school into a stage to educate against polluting our oceans. So in welcoming them today, hon.

Speaker, perhaps we can also welcome the hundreds of thousands of young people throughout every one of our communities who work, on Earth Day and every day, to save this planet.

L. Reid: Joining us in the galleries today is Mr. Digby Peers, a resident in the riding of Vancouver-Burrard. I would ask the House to please make him welcome.

R. Coleman: I would like to have the House welcome two constituents of mine today. One of them is Tracy Theodore, who is a real estate professional with Lakeview Realty in my riding. Also in the gallery today there is an old friend of my family, who actually babysat my children and who has turned out to be a terrific, capable young person: Kerry Brown.

G. Bowbrick: Joining us in the gallery today is a friend of mine, Jeff Inman, whom I first met as a student in the 1980s. He subsequently went on to become a medical doctor. I understand there was an attempt to lure him to the United States, but because, I am sure, of his commitment to our health care system, as well as the inescapable lure of British Columbia, he is back with us today. I'd like the House to please make him welcome.

R. Neufeld: It's my pleasure today to introduce Kathy Bedard from the Northern B.C. Winter Games Society in Prince Rupert. Would the House please make her welcome.

W. Hartley: Today visiting us we have Brenda Musclow and Dana McDonald. They are accompanied by my spouse Alice, our daughter Wallis and a niece, Nicole Muir, who is visiting from Paisley, Scotland. Please make them welcome.

A. Sanders: It's my pleasure to introduce a very important Vernon citizen. In the gallery today we have the mayor of Vernon, Mr. Wayne McGrath. Would everyone please make him welcome.

Hon. J. Pullinger: It's my pleasure to introduce my three delightful lunch companions for today: Mr. John Hellemond, who is a business person in British Columbia and who is involved in all sorts of interesting projects; Alistair MacLennan, who is the chair of Helijet Airways; and Chris Main, otherwise known as C. Main, who we hope will be the next Member of Parliament for the federal riding of Esquimalt-Juan de Fuca. Will the House please help us make them welcome.

R. Kasper: Joining us here today are some long-serving women from the community of Langford. They are members of the Langford Women's Institute. We have Dawn Cropp, Ann Campbell, Barbara Sinclair, Kay Collard, Mollie McArthur, Ina McDowall, Isobel Byrnes, Rose Button and Julie Darby. Will the House please make them welcome.

Hon. S. Hammell: I would like to introduce to the House today my new constituency assistant for Surrey-Green Timbers. Would the House please make welcome Harvinder Phandal.

S. Orcherton: Joining us in the gallery today is a delegation from Discovery School in my constituency. A number of grade 6 and 7 students are here today with a particular emphasis, as they are touring the Legislature, around the history of this Legislature. They are accompanied by Ms. Mackey, their instructor. Earlier today they asked me if we really do bang our desks in this House, and I assured them that indeed we do. On that note, I'd ask that the House make them welcome.

Hon. C. Evans: Joining us today from the SPCA are the president, Dr. David Wooldridge; Mr. Al Hickey, the chief executive officer; and Mr. John van der Hoeven, director of field operations. These gentlemen are here for meetings later in the day.

Also, I'd like to have people make welcome Kathryn Chapman, who is a co-op student with the fish secretariat and comes from the lovely village of Argenta in my constituency.

G. Janssen: With us today is Shane Morrow, a tireless reporter for the Alberni Valley Times . Accompanying him are Merideth Morrow and Kerry MacDonald, students who have just finished their tests at the University of Victoria, and also Judith Collington, formerly with the Georgia basin initiative and now a contractor working to save the environment. I ask the House to make them welcome.

Introduction of Bills

URANIUM MORATORIUM ACT

D. Symons presented a bill intituled Uranium Moratorium Act.

D. Symons: I think it appropriate that this is Earth Week and today is Earth Day as I introduce this particular bill.

[ Page 2712 ]

The Uranium Moratorium Act is, as its name suggests,

an act to protect the environment and help the citizens of this province from the harmful effects of radiation that's released into the environment when uranium is mined.

The Uranium Moratorium Act would be achieved by amending the Mineral Tenure Act to ensure that mining for uranium is prohibited. The act recognizes and makes allowances for the fact that trace amounts of uranium are found while mining for other minerals. It is not intended to, nor would it, inhibit normal mining operations for other minerals.

This act is not new, hon. Speaker. I freely admit to plagiarism from the moratorium regulations, brought in by the Social Credit government, that were in effect from 1980 through 1987. When those regulations expired in 1987, the then opposition, the NDP, strongly advocated the reinstatement of that moratorium. This act does precisely that.

Because of that past support for such

an act, I hope that all party members will support this act. I would ask the government to allow the bill to come forward this week as an appropriate sign of support for Earth Week.

Bill M205 introduced, read a first time and ordered to be placed on orders of the day for second reading at the next sitting of the House after today.

[2:15]

Oral Questions

WOMEN AND GAMBLING

L. Stephens: Yesterday I asked the Minister of Women's Equality about any studies or reviews her ministry had conducted on gambling expansion and domestic violence. The minister refused to answer my question.

I have obtained a copy of a 1994 report on problem gambling done for the B.C. Lottery Corporation by Angus Reid. It says: "Pathological gamblers provoke a reactive form of violence in their spouses, 37 percent of whom have physically abused their children."

Will the Minister of Women's Equality stand up for the women of British Columbia and oppose her government's gambling expansion policy, which will lead to more problem gamblers and more domestic violence?

Hon. S. Hammell: Hon. Speaker, I'm pleased to stand up in the House and answer a question on women's issues. As the member knows, this government has shown its commitment to prevent violence against women. We currently fund and will be funding 84 transition houses, safe homes and second-stage housing in British Columbia. We have initiated, for the first time ever, a specialized transition house dedicated to women with alcohol and drug abuse problems. We have, for the first time ever, instituted a program through the Children and Families ministry dedicated to people with a gambling problem -- the first time ever.

L. Stephens: Well, the minister doesn't understand that you have to stop the problem before it's started in the first place.

This is Prevention of Violence Against Women Week. This study clearly shows the link between problem gambling and domestic violence, yet the government is bent on imposing casinos in British Columbia. The study goes on to say: "The spouse of the male pathological gambler is three times more likely to attempt suicide than her counterpart in the general population."

Will the Minister of Women's Equality show her support for women in British Columbia during Prevention of Violence Against Women Week and demand that the Premier and his government halt these dangerous gambling expansions?

Hon. S. Hammell: The stats around domestic violence have shown that this government is at the forefront of combatting domestic violence. We have increased, from 56 percent to 74 percent, the number of domestic violence charges.

Interjections.

Hon. S. Hammell: Hon. Speaker, we have had gambling in this province since the early seventies. There is a modest increase proposed for gambling. We have, for the first time ever, a program to attack and deal with seriously addicted gamblers. This ministry and this government are at the forefront of the prevention of violence against women.

K. Whittred: This government's refusal to engage British Columbians in an honest public debate and address the issues surrounding gambling and women means that there are more questions than answers. The B.C. Lottery Corporation report states that the spouses of problem gamblers are eight times more likely to experience stress-related physical illnesses.

My question is for the Minister of Women's Equality. Does she accept the validity of these findings, and what is she doing to protect the health of B.C. women?

Hon. S. Hammell: The members opposite should know that we have been gambling in this province for over two decades, and there has been no direct research that I know of that shows a direct causal relationship

Interjections.

Hon. S. Hammell: No, we're talking about a poll, not research.

My ministry, in cooperation with community-based societies throughout this province, is constantly reviewing the research and information on violence against women. And if the members have anything beyond a poll that they're willing to share with us, we would be glad to receive it.

This government and this ministry are committed to working with women who suffer from abusive relationships. We fund 84 transition houses and second-stage houses, we support Children Who Witness Abuse, we counsel women and we counsel abusive men. Those people on the other side would eliminate the ministry and eliminate the issues around women.

K. Whittred: The B.C. Lottery Corporation report -- which we are sharing with you today -- is a chilling recitation of the risks from gambling expansion that lie ahead for B.C. families. The report also states: "The children of pathological gamblers do worse in school than their peers They attempt suicide twice as often as their classmates."

Again, my question is for the Minister of Women's Equality. When will she, as an advocate for women, stand and demand a halt to this reckless expansion of gambling?

[ Page 2713 ]

Hon. D. Miller: First of all, I'm somewhat bemused by the questions from the party opposite, because, as their leader said in 1994, gaming is no big problem. They then moved to the position that there should be a referendum -- so they're not saying they're opposed to gaming -- and lately some of them have been saying they're going to oppose. Nor, prior to the expansion that we've announced, have they stood up in this House and dealt with the serious problem of violence against women. They think there's an issue to capitalize on.

The Angus Reid survey is an update of the benchmark 1993 survey, and the '96 survey ". . .fails to show any evidence of an appreciable surge in gaming participation and any subsequent growth in the prevalence of problem gaming." That's a quote from Angus Reid, the author of the report, hon. Speaker. Perhaps they should stop being so selective in their quotations.

GOVERNMENT POLICY ON GAMBLING

G. Wilson: My question is to the minister responsible for gambling. Last Thursday I asked the minister about a document dated April 4, 1997, prepared by the chair of the Casino Management Council for members of the casino association. The minister told us he was unaware of that letter and told reporters that he deplored the secrecy of the document. The chair of the casino association told reporters: "We certainly didn't get any direction from government to do that or not to do that." Both of them wanted us to believe that from the outset they'd been putting their cards on the table. It now appears that they have been dealing from the bottom of the deck.

I have in my hand a handwritten fax memo, dated March 16, from the director of the Gaming Commission to the chair of the Casino Management Council, which says: "Please note the attached letter. BCGC wishes to introduce these enhancements quickly and without fanfare. Your assistance with a quiet implementation will be most appreciated."

The question to the minister is: will the minister now admit that he and his officials have always had a secret agenda designed to fast-track gaming in the province -- with respect to their policy, euphemistically called enhancement? Or is the minister equally as opposed to this secrecy question?

Hon. D. Miller: Certainly, I cannot be responsible for any letters written by people not under my ministry.

But on March 14 a letter went out from the chair of the Gaming Commission to the Casino Management Council, clearly outlining the issue of increased bet limits and the like. I can quote from the Province of March 19, in a story that I assume most British Columbians It would have appeared in other media as well. I'm quoted as saying that the bet limits were going up. There was no attempt at secrecy. This was clearly a matter of public record; it was published in the newspapers at the time. I don't know why we're trying to manufacture an issue. We're moving ahead. We said we'd do it, and we're doing it.

G. Wilson: Nobody's trying to manufacture an issue; we're simply trying to find out what this government's agenda is.

Will the minister, then, today commit to make public all of the minutes of the meetings that have taken place between the Casino Management Council and the B.C. Gaming Commission -- all of those meetings that took place this year? Will the minister commit to releasing those minutes for public review?

Hon. D. Miller: There really is no need to do anything other than reiterate a statement that appeared on March 19, when this government announced that we were going to increase the bet limits. The Gaming Commission's mandate is to move ahead and implement that with the charitable casinos. There's no secrecy. All British Columbians know we're doing it, and I don't know why at this point we're still trying to ascertain. . .or ask questions about it. We've been quite clear and open on the subject; it's been in the press. We've announced it publicly, and it's going ahead.

WOMEN AND GAMBLING

W. Hurd: My question is to the Minister of Women's Equality. Can the Minister of Women's Equality explain to this House why, as the minister responsible for protecting women in our province, she has not read a study on social gaming and problem gambling in British Columbia and their impact on the women of this province?

Hon. S. Hammell: This government's commitment to women is unparalleled. It is unparalleled in this province, and it's unparalleled in this country. There is no other Legislature that has a freestanding Ministry of Women's Equality devoted to the issues around women.

Interjections.

The Speaker: Members, I simply cannot hear the answer to the question, and I must have quiet.

Hon. S. Hammell: We support 84 transition houses, second-stage houses and safe homes that take women We widely distribute a poster to our communities so they know where the transition houses are. We fund community-based prevention programs for women suffering from violence. We have 81 counselling services. We have 50 counselling services for children who witness abuse. Our commitment to women is unparalleled, and our commitment to preventing violence against women is also unparalleled.

[2:30]

The Speaker: The bell terminates question period.

Orders of the Day

Hon. J. MacPhail: In Committee A, I call Committee of Supply estimates, and for the advice of the House, we'll be debating the estimates of the Ministry of Attorney General. In this House, I call second reading of Bill 2.

BUDGET MEASURES

IMPLEMENTATION ACT, 1997

(second reading continued)

C. Hansen: You know, often the first thing I do when I'm looking at second reading debate of a bill is look at what the bill is all about, the general principles of the bill. This, of course, being an omnibus bill, is supposed to be about a variety of things -- everything under the sun lumped into one bill that allows the Finance minister to proceed with his budget. But there is one theme, I think, that sort of ties this whole bill together. Basically, what all the measures in this bill do is download the financial mess that this government has created

[ Page 2714 ]

to anybody and everybody that they can find to pass it along to. This bill is all about forcing others to clean up their act. You know, we've had six years of deficits. We've had six years of financial incompetence. We've got $30 billion of debt. Now what they're doing with this act is trying to pass it on to everybody they can possibly find to pass it on to instead of taking responsibility and dealing with it at the provincial government level.

When this party came to power in 1971, there was about $15 billion of revenue coming in to the provincial treasury.

Hon. A. Petter: In 1971?

C. Hansen: In 1991. My apologies.

Today we've got about $20 billion coming into the provincial treasury. We've got about another $5 billion more. But what has this government done? They've used that $5 billion on a variety of their favourite projects. Are the people in this province better off because of the way that $5 billion has been spent? No. Did they spend that $5 billion wisely? I think not. What we have seen is that not only have they squandered that $5 billion of additional revenue -- a 30-some-odd percent increase in the revenues -- but they have spent more than that. That wasn't enough for them. As a result, we now have record deficits in this province and record debt.

You know, I remember, going back to the 1970s, when the very first billion-dollar budget was brought in under the Dave Barrett government. It was a milestone, and I remember it vividly. I was a political science student at the University of Victoria at the time. A billion dollars to run the provincial government. Today that billion only covers the payment on the debt.

So what did they do with these increased revenues? Did they go to patient care? They didn't go to patient care. Patients are worse off today than they were in 1991. Sure there's more money being spent on health care, but it's not getting to the patients. Where that money is going is into things like the health accord so you can pay back your union friends for their financial support during the election campaign.

Let's talk about the infrastructure program, which is often touted by this government as providing wonderful new services and facilities for the people of this province. But, in reality, are the taxpayers getting the full value that should be spent on these infrastructure programs? No. We're paying more than is necessary because we do not have open tendering in this province.

So did they put in policies that would allow the economy to grow? Isn't this the way you finance government: you build a healthy economy; you make sure that people are working and paying taxes; and that in turn is what allows you to pay for the health reforms, health care, education system and all the things that we need in this society? No. In fact, what we've seen is government policies to the exact contrary of that. We've seen government policies that have driven jobs out of this province. Do we have a job creation strategy in this province? No.

What we have, basically, are communications people who are spinning out documents that they call job strategies. They worry more about how you create the illusion of a job strategy than actually create jobs.

Do we have a government that knows where revenues are going to come from in the future to pay for the infrastructure that's being built today, to pay for the debt that is being driven up? There is no strategy in place that's going to allow for a dynamic economy in the future. In fact, what we are seeing is policies that are going to set the clock back when it comes to the economic health of this province.

You know, today we've got 170,000 British Columbians who are unemployed -- 170,000 British Columbians who not only are unemployed but who wish they were working. If you count in all of the workers who are unemployed that aren't actively seeking jobs, because they're not out there, that number would be a lot higher. But do we have a government that has policies that are creating job opportunities for those 170,000? No. As a result, this Finance minister is not getting the tax revenues that he could out of income tax, because those individuals are not working today.

Revenues from corporate income tax are down. Why are they down? Because this government has made it impossible for corporations in this province to create profit. Do you know what? Do you know where corporate income tax comes from? It comes from taxing the profits of corporations. Ah, but this government has found a solution to that. Not only do they think that profit is a bad word and they're doing everything possible to make sure any corporation in this province doesn't make a profit, but they have found that instead of relying on profit, they're going to tax the corporations that are losing money.

What better way to drive them out of the province even faster? "Let's bring in a corporation capital tax, so the companies that are actually innovating, the companies that are using technology Let's hammer them with another tax, even though they're already losing money."

In the election campaign, the NDP candidate in my riding was asked, at an all-candidates meeting, whether or not corporations that were losing money had to pay corporate capital tax. He said: "I don't know." I was appalled. No wonder people will seek to become candidates for the New Democratic Party, when they don't even know that corporation capital taxes are paid by all corporations, regardless of whether they're profitable or otherwise.

Hon. A. Petter: Not small ones.

C. Hansen: And small ones. The Minister of Finance says: "Not small ones." Small corporations in this province pay corporation capital tax, and they pay it dearly. If they're renting a building that is owned by somebody that has assets of more than $3.5 million, they're paying corporation capital tax. And they're paying it dearly. Everybody is paying it. There are very, very few corporations that are not paying for this.

You know what the NDP approach is to creating small business in this province? You start out with a big corporation, you bring in policies that force them to lay off 95 percent of their staff, and lo and behold, you've got a small corporation. That's what this government is doing to create small businesses.

So Bill 2 is all about what this government is going to do to clean up the mess they've created in their house. And they're doing two things. The first thing is that they're sweeping the mess under the carpet; that's part of what they're doing. The other thing in Bill 2 is that they are cleaning up their yard by scooping it up and throwing it over into the neighbour's yard.

Let's look under these carpets -- the sideways shift, I think the Minister of Forests calls this. What they're doing is taking the problems they've created in terms of the administration of government, and they're shoving it sideways. Let's

[ Page 2715 ]

take the motor vehicle commission, for example -- and I'm glad that the minister responsible for the motor vehicle commission is here to hear this.

You take the motor vehicle commission, and you shove it sideways into ICBC where it's no longer directly accountable to this House. You take the responsibilities of the Ministry of Forests and the Ministry of Environment, and you shuffle those sideways into FRBC. What we are seeing is the decreasing accountability of this government to this chamber. And that, I think, is one of the biggest problems we are facing in this Legislature: diminishing accountability. We're seeing a centralization of power in the Premier's Office. This province is not being well served by this government, which is eroding democratic principles and decreasing the accountability to this chamber.

That's what they've talked about in terms of shoving things under the carpet, but let's talk about what they've thrown over the fence. What they've thrown over the fence is about $113 million of downloading to municipalities. They're forcing the municipalities to deal with the problems that they have created when it comes to funding public enterprise, when it comes to funding government generally. There's not a federal taxpayer, a provincial taxpayer and a civic taxpayer; there's only one taxpayer. So when they take this kind of downloading and they say to the municipalities, "You pick up the pieces; you pay for this," that money still has to come out of that same taxpayer's pocket.

Let's talk for a minute about the lack of notice that took place. You know, I was at the UBCM convention last September, when the then Minister of Municipal Affairs stood up and bragged about the protocol of understanding that was there: this wonderful new revolution in the relationship between the provincial government and municipalities, a protocol that ensured that there was going to be consultation with municipalities, that nothing would be thrown on them without proper debate, proper consideration and proper opportunity for input from those municipalities.

I remember that minister smugly telling delegates: "Well, there are going to be some big cuts coming." This was the inference. It was obvious to everybody in that room that the minister at that time knew the magnitude of the cuts that were going to be forced on the municipalities, and not only was he not consulting municipalities, not only was he not discussing it with them openly, but he knew then what those cuts were going to be, and he did not tell the delegates. He did not tell the municipalities. He did not tell the people of British Columbia. Why? Because there was a civic election campaign coming up.

He wanted to make sure that this was swept under the carpet until that civic election campaign was over so that it wouldn't hurt NDP members running in that campaign.

[2:45]

You know, we all know that you cannot necessarily believe what this Premier says. It's obvious that he talks the talk, but he doesn't walk the walk. But his signature is on this document. His signature is on this protocol. It's one thing for a Premier to say one thing and do another thing, it's one thing for him to make promises that then get broken, it's one thing to say that action is going to happen and then find later that there is no action taking place.

It's one thing not to walk the talk, but it's another thing when you have the signature of a Premier of this province on the bottom of a document, and before that ink is even dry, this government is ignoring what that document says. It's bad enough when they don't live up to what they're going to say, but when they sign documents where they say they're going to do something and then don't follow through, that erodes the office of the Premier, it erodes the reputation of this chamber, and it erodes the reputation of not just the government members but of government generally and all 75 members of this chamber.

Now I want to talk for a minute about Infrastructure Works. Last Friday we had the Premier again putting his signature on a document that profoundly affects municipalities, and yet there was no consultation that I've been aware of, no consultation that I've been able to determine with the municipalities. Yet the Premier expects that the municipalities are going to be a one-third partner in this new Infrastructure Works program.

I listened to the Premier's press conference on Friday. It was interesting. One of the things he talked about, which isn't included under this Infrastructure Works program, was the pent-up demand in this province for new sewers. It's something I want to discuss with the Minister of Municipal Affairs, because quite frankly, if we have pent-up demand for sewers in this province, this could be a problem of major proportions when it comes to public policy. What we see is that there is no relief under this bill for any jurisdiction that is facing pent-up demand for sewers.

What we are seeing is that because of this bill, municipalities are going to have less ability to deal with that pent-up demand for sewers.

I am not sure how much longer taxpayers are going to be able to hold on when they are getting gouged by a government that, every time they turn around, is taking more money out of their pockets. It's taking money out of their pockets not just through provincial government sources, but now it's reaching through the municipalities and taking money out of those taxpayers' pockets through the municipal governments, as well. You know, the Infrastructure Works program is going to have a profound impact on municipalities in this province.

And now they are forcing municipalities to pay more than they would have to otherwise pay under that Infrastructure Works program, because they are imposing the fixed-wage policies of this provincial government. They are imposing those policies on federal government participation, and they are forcing those policies on municipal government participation. That's what I call extraterritoriality.

You know, I think all of us in this chamber are quite indignant when we see the American government trying to impose its legislation on the people of Canada -- or the people of any country, for that matter. And here we have, through the policies of this government When it comes to fixed wages, they're forcing those policies on municipal governments and on the federal government. In the end, the taxpayer is going to pay more for those needed infrastructure policies.

You know, the city of Vancouver got hit at the end of November. They got one month's notice that they were going to get hit with a $17 million cut in funding -- $17.2 million, to be exact. You know, I put that to the Minister of Municipal Affairs, who has a budget about the same size as the city of Vancouver -- in fact, a little bit less. How would he like it if he had a $17.2 million cut to his ministry in addition to the cuts that had already been made, and he was given virtually no warning that it was going to happen?

How would the Minister of Forests like it if, in his ministry, in addition to all of the other cuts that have been made and the sideways shuffles to FRBC, he was hit short-notice with $17 million in cuts? How would the Minister of Transportation and Highways like it, who has a budget almost the same as the city of Vancouver?

Interjection.

[ Page 2716 ]

C. Hansen: I see that the hon. member for Alberni is trying to help us with the pent-up demand for sewer systems.

Hon. Speaker, how would the Minister of Transportation and Highways like it if she had to take, on short notice, a $17.2 million cut in her ministry in addition to the other cuts that have been made? This is basically what this government is forcing on the city of Vancouver and all municipalities around this province.

You know, I got a report card sent to me, and I just wanted to read some of these quotes. This is a quote that was made by the Premier in 1993: "I am prepared to agree to enter into some certainty for municipal governments, which constrains my options down the road." Was that promise kept? No.

We have a quote from the previous Minister of Finance, Elizabeth Cull. She says: "This legislation" -- being the Local Government Grants Act -- "is designed to deal with stability and predictability, and it does that." Was this promise kept, hon. Speaker? No.

The previous Minister of Municipal Affairs, Darlene Marzari, said, on the subject of grant reform: "This [government] has taken a stand with the municipalities to seek. . .some form of credible relationship between the provincial government and. . .municipalities." She was basically promising a credible relationship. We have an incredible relationship. Was this promise built on? Was it followed through on? No.

We've got the Premier in 1994, when he referred to the formula under the Local Government Grants Act. Do you know what his words were to describe that formula? He said that it was guaranteed. Was that promise lived up to? No. In fact, when we look at the Guarantee for Youth that this government has brought in, we realize that guarantees from this government are not worth the paper they're written on.

Again from the Premier: "Talks are to begin with the Union of B.C. Municipalities to determine how these savings are to be achieved." And this is in October of 1996. A month later, did talks begin? Were there consultations? No. Was the promise lived up to? No. And in September of 1996 he said to the municipalities: "We will work with you, we will involve you in our consultations." Was that promise kept? No.

The previous Minister of Municipal Affairs -- he's currently the Minister of Employment and Investment -- said: ". . .no decisions have been made yet, and none will be made until a review is complete and we have a complete analysis of the impact." Was that analysis of the accumulated impact of program reductions and eliminations made available to municipalities? No.

And finally, again from that previous minister: "To the extent possible, you will be involved in a dialogue around the significant changes from early in the process." Was that lived up to, hon. Speaker? No.

So what we have is a government that is poisoning relationships. It's a government that is pitting city against city. It's a government that is pitting school boards against school boards. It is a government that is pitting Indian bands against local governments. And it's wrong.

What we need is a spirit of cooperation, and not just when it comes to relationships with municipalities but generally with the relationship that this government has with all aspects of our society, with all groups. We should have certainty so these bodies and agencies know what they're dealing with, so they can plan responsibly on behalf of their public.

I implore this government to change that direction, to bring in that spirit of cooperation, to start fresh and to make sure that there is that spirit of cooperation so that all levels of government work together, recognizing that there is only one taxpayer; so that those levels can make sure that tax dollars are spent wisely and for the best efforts of everybody involved; and so that we can build a good society in this province for our children.

G. Abbott: Hon. Speaker, I beg leave to make an introduction.

Leave granted.

G. Abbott: It's a delight for me to welcome in the gallery today three constituents from Shuswap. Debbie McCabe is here with her sons Tyrone and Keegan. I would like the House to make them welcome.

J. van Dongen: I am pleased today to participate in the second reading debate on Bill 2, the Budget Measures Implementation Act. I am particularly pleased to respond from the perspective of agriculture, on which there are some significant impacts in the bill.

Like most people in British Columbia, I am disappointed when commitments made by the government are not kept. I think, furthermore, many people are angry and upset that promises made were not kept. In particular, local governments in B.C., with major responsibilities to their communities, are very upset and are faced with some very difficult decisions. Local governments have not only seen cuts in their grants, but they have seen downloading of highways. They have seen downloading of certain courthouse costs, both direct and operational costs, and ancillary costs such as police costs.

Ranchers in B.C. have seen grazing enhancement fund commitments cut to less than one half and spread out over ten years rather than five. Tree fruit growers have also seen clear political commitments broken. Virtual legal agreements were broken, changed and renegotiated. Propane users -- people who went through the trouble and cost of converting their vehicles to a more environmentally friendly fuel option at the encouragement of the government There is a whole range of user fees which have suddenly increased.

A notable example is licence fees for recreational anglers -- a sudden increase with no consultation, no notice, no proper long-term planning together with the industry and with the anglers.

The budget for 1997-98 and this Budget Measures Implementation Act represent broken commitments, bad operational and financial planning, a lack of commitment to good management over a sensible time frame and a lack of real consultation and true partnership with other governments, businesses and individual taxpayers. One of the biggest problems for me is the lack of long-term planning and the lack of fair and businesslike consultation and notice of impending changes.

I want to address some specific aspects of the bill, starting with

section 1, which deals with the agricultural land development fund special account. This represents the final elimination of a program that I think has served agriculture well and should have been retained. This was a low-interest program that was available for very limited, specific purposes, which were designated by cabinet. This program was, in my view, a good public policy tool, not just for agriculture but also for the public, and it was historically used to provide incentives and assistance for drainage, land clearing, fencing and other

pro-

[ Page 2717 ]

grams. Some of the public concerns that could be addressed with this policy are environmental concerns or other issues revolving around rural-urban conflicts.

I want to now comment on the cuts in the grazing enhancement fund -- another broken promise. In late 1994 the former Premier made commitments to implement the grazing enhancement fund as part of the land use planning process to provide the ranching industry with a fund "to maintain or enhance cattle grazing opportunities and meet conservation needs." Over a period of several months, the commitments totalled $4.5 million, and those were broken up into three areas, including the Cariboo-Chilcotin land use plan, Kamloops and Kootenay-Boundary.

A total of $4.5 million per year for five years -- that was the commitment. When the 1996-97 budget was established, the commitment became $3.4 million every year for five years. Then last November 5, when the announcement was made by the current Minister of Agriculture, the grazing enhancement fund was capped at $1.5 million annually but will be extended from a five-year program to a ten-year program. The amendment in the bill actually extends the sunset clause by five years for that legislation.

But again, if you look at the series of broken commitments, it's a major disappointment for ranchers and conservation needs in the province.

[3:00]

In the tree fruit industry, the government had made very clear commitments to orchardists in the Okanagan, including a commitment by the previous Minister of Agriculture, Fisheries and Food, in January of 1996, reaffirmed by a very significant pre-election press release in April of '96. These were very clear commitments that had been made to orchardists as part of a ten-year plan to create a transition in the industry, from an industry that was dependent on government handouts to one that was self-sustaining and could rely on the marketplace for its returns.

In January of 1996 a five-year business plan by the Okanagan Valley Tree Fruit Authority was approved by Treasury Board. The industry was stabilized as a result of that plan in the sense that there would be a planned transition through a partnership between the agricultural industry, the tree fruit industry and government.

After the election, one partner pulled out. The provincial government suddenly decided that it had budget problems. People had agreements; orchardists had signed commitments. They had made plans; they had planned their crop rotation; they had removed trees. Both sides -- the government and growers -- sought legal opinions to assess their positions. In the end, I think the broken commitment by the government to the tree fruit industry was best summed up by one of the leaders in the industry, who said that the government saved $1 million, and it cost them $10 million.

There are a number of amendments in the bill with respect to the motor fuel tax. In this connection I want to address the propane tax, a new tax being implemented by the Minister of Finance. I found a tremendous reaction in my constituency to this decision and the threat of this decision, the establishment of a new tax on propane.

Everyone, from the school board that had no way to pass on costs, to people like Fraser Valley Refrigeration, who had 43 vehicles on propane Fraser Valley Refrigeration repairs and maintains everything, from bulk milk tanks on farms, to refrigeration in restaurants, to air conditioning in offices, to refrigeration in food plants. These costs will simply be passed on. It is extremely disturbing to see governments constantly changing the rules. People who went through the trouble of going to options that help the environment and help air quality were again let down.

I'd now like to address the amendments to the Local Government Grants Act, sections 12 and 13 of the bill. The Local Government Grants Act of 1994 -- and the minister at the time -- promised stability, certainty and a long-term partnership with local governments. My reading of the Budget Measures Implementation Act suggests that this commitment to stability, certainty and partnership is gone. The impact of the amendments proposed in sections 12 and 13 is that anything can happen now. The minister can write any kind of funding formula that suits the whim of the government.

Under these circumstances, it is no surprise that many mayors and local governments are very angry, and this was certainly reflected in a recent newspaper report of an undisclosed survey by the Union of B.C. Municipalities. In this survey they had asked mayors to respond to the results of 11 commitments made by the provincial government to local governments, and the response was extremely, extremely negative. I want to quote two comments by two of these mayors: "The worst

part is that the public's cynicism toward politicians is felt by us, who are actually accountable to our electorate. It is galling to be lumped together with a group that is so dishonest, shortsighted and ignorant." And another comment was: "The provincial government's unilateral actions are unbelievable, outrageous, immoral, dictatorial and contrary to their own legislation."

I think one of the biggest failures of the provincial government was the lack of notice given to municipalities. The announcement of major cuts and other downloading measures was done at the last minute to avoid discussion during local government elections. At that point, municipalities had one week to file their provisional budgets. I also want to echo the comments of the member for Vancouver-Quilchena with respect to the protocol agreement that was signed with municipalities at last year's UBCM meeting: "You can write anything you like on paper; if you don't keep your word, it doesn't mean very much."

I also want to question -- and point out -- the government's decision to come out with a small community protection grant program and equalization grants to small municipalities to mitigate the impact of budget cuts. When we met recently with the UBCM executive, there was a real concern expressed by those people that this was a conscious effort to divide and conquer all of the municipalities within British Columbia, and to pit large against small. I sincerely hope that this is not the case, and that the new minister will make additional effort to address and work together with UBCM as a group, large and small municipalities together.

I want to mention the impact on the city of Abbotsford of some of the cuts and transfers. Last year the transfers to the city of Abbotsford amounted to $4.5 million. The 1997 transfer will be $2.7 million. That's a reduction of 38 percent. If we look at that reduction of $1.7 million against the property tax roll, that represents 4.7 percent of property taxes in the city of Abbotsford. Our council has decided to increase property taxes by 3.5 percent for the coming year. In so doing, on the issue of grants alone, they are absorbing approximately 20 percent of the cuts in their provincial grant.

In addition, as I said earlier, the city is absorbing the cost of highway downloading and a whole range of other subtle and more blatant shifts of responsibility and costs to local government.

I was particularly appalled to hear the former Minister of Municipal Affairs and other members of his caucus suggest that it was about time local governments start managing their finances more carefully. The suggestion was that the province was leading the way in cutting costs and reducing financial

[ Page 2718 ]

waste, and that it was about time that local governments did the same thing. It's not hard to see why local governments are upset by this statement and this attitude. In my view, local governments have been doing a better job of managing costs and could teach this provincial government a lot about how to get the job done.

I want to mention one other example of provincial government downloading on local and regional government that impacts agriculture -- in this case, ranchers in the interior -- and that is a cut in the Ministry of Agriculture, Fisheries and Food budget of weed control grants. The elimination of weed control grants in the '97-98 budget to regional districts, municipalities and cattlemen's groups has the potential to set the control of noxious weeds in the province back for many years.

Regional districts and municipalities are already trying to come to grips with how they will adjust their budgets to address the reductions in and/or elimination of provincial grants. The elimination of weed control grants will lead to the elimination of what has been a well-structured weed control program. We're talking about weed control along road allowances and other public areas. Most certainly the ranching industry can ill afford to absorb more costs off-loaded in this manner.

This is again an example of government downloading on local and regional governments, for which we have not seen the full impact and the consequences.

In closing, I will vote against this bill and all that it represents. For me, it represents doublespeak and deceit with respect to a number of successive budgets. For me, it represents a total lack of genuine consultation. It represents a repeated pattern of untimely announcements, with a lack of proper notice and professional courtesy -- especially with local governments, but also with business and taxpayers in general.

What we are seeing is a lot of other people having to pick up and bail out the provincial government from the results of five years of not being concerned about the financial implications of their decisions. The reality is that better fiscal management is being forced on the government by a taxpayer who is fed up with paying, and I will vote in support of that taxpayer on this bill.

B. Penner: It's my privilege today to rise and speak on the principle of Bill 2. We are in second reading, and second reading is traditionally a time to address the primary principle behind a bill. There are many principles contained in this bill, because it's an omnibus bill. There are some good things in this bill, but there are also some bad things.

First, the good news. I think the changes, particularly under

section 3 of the act, make some sense. I'm happy to see that the government has accepted some of the recommendations coming from the Public Accounts Committee and the auditor general with regard to dealing with how full-time-equivalent employees are recorded in the public accounts and provided for in the estimates that the Minister of Finance includes in his annual budget. I think that the increased disclosure contemplated under sections 3 through 5 of the changes to the act is salutary, and I support that.

However, there are many things in Bill 2 which are not as positive. Accordingly, I have some serious concerns about them. What particularly gives me great concern are the clauses in Bill 2 -- I believe contained in sections 12 through 15 -- which basically gut, in my view, the Local Government Grants Act. As you know, the provision in Bill 2 removes the obligation for the provincial government to pay unconditional grants to municipalities. It leaves the municipalities open to further downloading by this government.

Over the past number of years, we've certainly seen that this government has been less than forthright in its handling of the province's finances and in the way it accounts to the public for its handling of the finances.

We can start with the most recent budget of this government. Costs were again downloaded to municipalities, while this government pretends that it has decreased spending in an effort to get its financial house in order.

The fact is that on paper, much of that saving is only accomplished by shifting expenditures sideways to other agencies and to other forms of government. In fact, it was the Minister of Forests who talked about sideways-shifted funding to describe how the B.C. government has come up with a new way to raid Forest Renewal funds.

Rather than going through the front door and emptying the vault, they've decided to go through the side door and take money away from the original purpose of Forest Renewal to fund existing Ministry of Forests projects and programs, particularly silviculture programs that have traditionally been funded by the Ministry of Forests. The original mandate for Forest Renewal B.C. was that it was only to fund programs in addition to those that were already existing.

So instead of living up to that mandate, we now see a sideways shift in funding -- to use the Minister of Forest's term -- and they're doing through the side door what they chose not to do through the front door.

[3:15]

Other shifts are occurring, and they're consistent with what we see as the intent of Bill 2. In fact, there was a pretty clear and concise

article in the weekend Times Colonist , on Sunday, April 20, written by Don Scott, who I understand was at one time an NDP MLA in a different province. He's gone through this year's budget presented by the Minister of Finance, and estimates that because of the downloading and the sideways-shifting in funds and accounting, the real deficit for this year is probably closer to $1 billion, and, looking ahead to next year, thinks it could be approaching $1.7 billion.

He gets to those figures by looking at how this government is contriving new ways to download costs to municipalities, to Crown corporations or to government agencies such as the Transportation Financing Authority, which is being saddled with extra costs. At the end of the day, the taxpayer is still on the hook, and I don't think the taxpayer will be fooled into thinking that their tax bill is going down when, in fact, they know that their wallet is getting lighter. So that's one thing that gives me concern.

The second thing is that I was at the last convention held by the Union of B.C. Municipalities. That convention was held last September in Penticton. At that convention, much was made by the Municipal Affairs minister of a signing that he did in conjunction with the mayors from all across British Columbia. What they signed was a protocol agreement which purported to promise, on behalf of the provincial government, a new level of consultation with the provincial government prior to any decisions being made that would impact local governments.

I was there for that promise, as were most of the mayors of British Columbia. Yet only two months later the Minister of Municipal Affairs, without any consultation and in complete abrogation of that protocol signed only two months earlier, announced cuts in municipal grants averaging 30 percent across the province. In fact, in some municipalities those cuts were the equivalent of 80 percent of the existing levels of grants. That move was in complete violation of the protocol agreement that was signed only two months earlier.

Little wonder, then, that the mayors across British Columbia have a high level of distrust for this government.

Quite frankly, when I speak to some of the local mayors, they ask me what could possibly come next. Well, I think

[ Page 2719 ]

we've seen what's coming next, and it's the changes in Bill 2, which take away the existing protection. Those levels of cuts that were announced in November of 1996 are not only in violation of the protocol agreement signed in September, but they also violate the Local Government Grants Act, which was supposed to prevent decreases in municipal grants in excess of 2 percent per year. The government has decided to go ahead with cuts that average 30 percent across the province -- 15 times the maximum allowed under the Local Government Grants Act -- and that is why I believe they have the provisions in Bill 2 -- to gut the Local Government Grants Act.

After hearing from some mayors, I contacted my local municipality, the district of Chilliwack, and wanted to find out from them firsthand what kind of impact this government's unilateral action and violation of the protocol would have upon the district of Chilliwack. I received a letter today, dated April 18, 1997, signed by the mayor of Chilliwack, indicating that the full dollar impact of grant cuts on Chilliwack will total $1,041,556. I had asked the mayor to provide me with a description of the impact that that kind of reduction in grants would have on programs and services in Chilliwack.

I'm going to go through what some of those impacts are, because sometimes I get the feeling that this government simply doesn't understand the ramifications of their own decisions.

For example, because of the grant cuts announced last November, the district of Chilliwack had to work overtime to come up with a provisional budget. Those grant cuts were announced within days of the deadline for provisional budgets. The provincial government places the requirement on local governments to come up with a provisional budget by a certain deadline. So the provincial government was well aware of that deadline, because its the one that imposes it on local governments. Despite that, only a few days before that deadline they trot out an announcement about these drastic cuts to municipalities.

I might point out that they did that shortly after municipal elections were completed, probably so as not to hurt supporters of their party in their bid for municipal office. So shortly after the municipal elections were over, the grant cuts were announced. The people all across British Columbia working in local government had to go back, sharpen their pencils and work overtime to try to come up with a provisional budget which, as you know, has to be balanced.

So what has the impact of these cuts been on Chilliwack? For example, it has delayed the budget decision-making process, and it has caused a great deal of uncertainty to those agencies and community organizations that rely on funding from the district of Chilliwack. I know that my local constituency office received many visits, phone calls and letters from groups in Chilliwack, wondering what was going to happen to their funding, because all they heard through the media was that everything was on the table and up for grabs.

All user fees and services in Chilliwack were put under review. Department heads were advised to delete all proposed or vacant positions from the budget. Re-examination of all unionized positions and benefits was undertaken. And this is something I think the government fails to understand: they'll make an announcement here in Victoria without really considering the impact on people in local areas, and I think they would be surprised, being so greatly dependent upon trade union donations to fund their election campaigns, to find out that this action by their government is directly hurting their trade union supporters.

There is an additional impact in Chilliwack, and that is that a fund that has been held in reserve to pay for any future landfill requirements in the district of Chilliwack had to be diverted to pay for urgent road repairs. That was to make up for the difference in the municipal grants. In addition, service levels to the public had to be reduced, in terms of counter service when people came into the financial office of the district of Chilliwack. Those staff positions had to be reduced. The safety coordination function of the district of Chilliwack was reduced.

There are other safety implications due to these municipal grant cuts. There has been a reduced firefighting inspection staff level in Chilliwack. There has also been a reduced contingent of staff working in security or custodial functions at civic buildings in the district of Chilliwack. Because of the hiring freeze that the district of Chilliwack has had to implement, it has meant that there are now fewer public works employees available to respond to public needs -- for example, urgent snow-clearing requirements when the weather brings us some heavy snowfalls. There are also fewer building inspectors.

This means that there are longer waits for building permits to get approved. This will impact the provincial treasury, because the slower the construction process, the longer the government will have to wait for revenue generated from taxation on the sale of properties, as well as from the income earned by people working on those projects.

Finally, the district of Chilliwack had to reduce their grants-in-aid to community groups, as had been feared. As I previously stated, there are a great many community groups that rely mostly on volunteer labour but do need some funding to get by on a year-to-year basis, and they are now seeing that their grants are being reduced, after being frozen for many years.

There have been other implications, perhaps some not as serious as others, within the very offices that are staffed by district-of-Chilliwack employees. I am told that the number of faxes and photocopiers has been reduced and that they've had to go to outsourcing of several services. I believe that's another way of saying contracting-out. Again, I think this government might be surprised to learn that because of its actions, trade union members are losing out on employment opportunities as the district of Chilliwack is forced to consider expanding contracting-out in order to meet budgetary requirements.

This government, in its most recent budget, proclaimed that there were no tax increases for the people of British Columbia under this government. However, because of this off-loading onto municipalities, the district of Chilliwack has had to raise a whole number of fees in an attempt to make up the more than $1 million shortfall. For example, development fees have been increased, recreation fees have been increased, and fees to burn certain materials have also been increased.

Any person requiring those types of permits or services are certainly going to feel as though their taxes have gone up, because at the end of the day they will have less money in their pocket. It once again shows that the government has been less than forthright in how it has presented the financial state of the province to the taxpayers.

At present, the district of Chilliwack is coping and, I would say, probably reeling with the extra burden imposed on it by the Attorney General. That burden is the extra $375,000 a year that the district of Chilliwack will have to "voluntarily" contribute in order to maintain the existing court services in our area. The district of Chilliwack has had a Supreme Court service since 1884, when Mr. Matthew Begbie, also known as the hanging judge, first sat in Chilliwack in the Supreme Court. Ten years later the first actual courthouse was built in

[ Page 2720 ]

Chilliwack, and that opened in the fall of 1894. Yet in February of this year, this government unilaterally announced, without any consultation, that they were going to remove all court services from the upper Fraser Valley.

After a community protest was organized, the government then said to the district of Chilliwack: "You can continue to have court services available to the poor and the most vulnerable, but only if the taxpayers pay $375,000 a year extra for services they've already paid for through their provincial taxes." When you calculate all of that together -- the extra cost associated with the court services, as extracted by the Attorney General under threat of closure of the courthouse -- and when you add that figure to the grant reductions, the extra burden that this provincial government has placed on the district of Chilliwack is close to $1.5 million.

That all came without any consultation and without any warning, again contrary to the protocol signed last September at the Union of British Columbia Municipalities in Penticton. I wouldn't be at all surprised if, in the future, the various mayors decide that perhaps they had better not enter into any more protocols with this government for fear of what could happen to them next.

I'll turn my attention now to sections 18 through 22 of Bill 2, particularly those provisions that purport to authorize an increase in tax on propane.

My office has received numerous letters and phone calls from those people who converted their vehicles to this alternate fuel source in hope of (1) helping the environment and (2) reducing their fuel costs. It's difficult to expect people to do something strictly out of the goodness of their heart if it's going to cost them more, and that was the rationale years ago for not having this extra tax on propane. The people who have invested -- in some cases thousands of dollars -- in their vehicle fleets, in converting them to propane fuel, now feel that they have been led astray by this government.

They will have little option but to pay this extra tax of 2.2 cents per litre of fuel. Under Bill 2, that tax is set to come into force on June 1 of this year.

I heard the member for Fort Langley-Aldergrove speaking earlier, and I thought he made a very good point that the Fraser Valley has some of the worst air pollution in Canada. In fact, we rate right up there with the rest of North America in terms of being one of the top areas for air pollution. In fact, when it comes to respiratory illness, the Fraser Valley has one of the highest incidences of respiratory illness in all of North America.

It's astounding to me that this government would take an action that can only be seen to result in an increase in higher-polluting fuels rather than encouraging individuals to consider lower-polluting fuels for their vehicles. This is clearly a retrograde step. It is not supported by the people in my part of the province, and it is one of the major reasons why I will be forced to vote against Bill 2 when this bill comes to a vote in second reading.

That concludes my remarks. I thank the Speaker for the opportunity to express myself on behalf of the constituents of Chilliwack. I believe that my colleague from Oak Bay-Gordon Head would like to make a few remarks.

[3:30]

I. Chong: Contained within Bill 2, the Budget Measures Implementation Act, are several amendments intended to provide language consistent with other various pieces of legislation, which I do not foresee as a problem.

However, there are some rather significant amendments which are noteworthy, and which I will not allow to proceed unchallenged. I realize that many members on this side of the House have already spoken to some of these changes, but they are so important that they demand our attention yet again. As one of only two members in opposition who represents a riding in the capital region, it is my duty to speak on behalf of all the constituents who are now being ignored by the members for Victoria-Hillside, Victoria-Beacon Hill, Esquimalt-Metchosin, Malahat-Juan de Fuca and, of course, Saanich South.

One of the proposed amendments deals with the Assessment Authority Act. This change would allow a downloading of certain costs of appeals to the B.C. Assessment Authority, which are normally funded by the Ministry of Municipal Affairs and Housing. If the B.C. Assessment Authority must now include these costs in its budget, then who are they going to target to recover these costs? Well, it shouldn't surprise anyone, of course. It will be the taxpayers, who will see an increase in their property taxes.

You have to wonder why the B.C. Assessment Authority is not complaining, is not outraged, and is not pointing out this government's fiscal mismanagement. I suppose they're not complaining, because the appointees to the board of the B.C. Assessment Authority are primarily friends of the NDP. Isn't that a surprise!

All changes should be subject to some form of accountability, and throughout this bill we see that there is very little accountability. In February of 1995 a confidential Treasury Board memo indicated that B.C.'s debt has been growing at an "unsustainable rate." The memo from Treasury Board also states that even with ten years of surplus, the overall provincial debt will not drop. Who is listening?

We know that the former Finance minister and the current Finance minister ignored this memo insofar as they did not recognize it publicly. Instead, the Finance minister is attempting to privately heed this warning by imposing their cost on municipalities. One painfully clear fact is that the NDP's solution to red ink is to pass their fiscal problems and fiscal ineptitude on to municipalities, so now we have Bill 2 with all these amendments.

Municipalities will be facing a cutback of 28 percent overall, so I would like to share with the members opposite what that means in real dollars for this region. For the city of Victoria there is going to be a shortage of $2.6 million, of which $1.1 million is the amount the province is no longer paying out as grant money in lieu of taxes for the Legislature and Government House on Rockland. How is it that this government can refuse to pay its fair share of property taxes? I guess it's because this government lives by the statement made by the Minister of Forests that this government can do whatever it wants.

I would like to look further at the other municipalities in this region. The district of Oak Bay, one of the municipalities that I represent, will be faced with a $461,000 cutback. But I'm sure they're going to manage that; there are fiscal managers on that council. And for Esquimalt, there is a $410,000 reduction that could amount to a 5 percent property tax increase. So why is the member for Esquimalt-Metchosin so silent on behalf of his constituents?

An Hon. Member: Who's going to speak for Esquimalt?

I. Chong: I don't know who's going to speak for Esquimalt, but I would like the hon. member to know that I know what the reduction is. Allow me to carry on.

[ Page 2721 ]

For the district of Saanich there is going to be a reduction of $2 million. I believe that to be the first hit. I expect that this government will change legislation once again to allow for the redesignation of roads as regional roads, and off-loading of costs will occur at the municipal level.

For the benefit of those following these proceedings and this debate, I think it's incumbent on me to continue with the statistics for this region.

An Hon. Member: The member from Esquimalt is listening.

I. Chong: Well, I'm glad he's finally listening, because he just missed his $410,000 reduction.

The town of Sidney is going to lose $214,000; Central Saanich, $232,000; North Saanich, $122,000; Colwood, $400,000 in provincial cuts plus another $66,000 from Royal Roads University; Langford, $150,000; View Royal, $38,000. These are all in the capital region, and who on the other side of the House is speaking up on behalf of these municipalities?

What will these cuts do? They will affect programs such as the young offender's program, the crime prevention liaison program, a community youth centre slated for Colwood, a safety watch program and, of course, community grants and arts grants.

Elected municipal officers just want to be treated with a little bit of fairness and respect, and the Minister of Municipal Affairs has failed to follow through on either policy or process. What is so extremely offensive is the lack of process. What do we mean by process? All we're talking about is the promise of consultation, a promise that isn't hard to keep, provided there is a willingness on the other side to do so. Don't continue to insult; start to consult.

Over the years, we have seen unilateral actions on behalf of this NDP government, and they have shown clearly that there is no willingness on the part of this government to act responsibly. How else would one define the breach of the Local Government Grants Act, except to say that it is a betrayal of trust? The Local Government Grants Act was

an act -- and you've heard it all before -- that was to provide certainty, stability and predictability to municipalities. For this government, those are just words without meaning.

When the revenue-sharing grant was terminated in 1994 and there was $250 million owed to the local governments, it was scooped up by this government. Why didn't the municipalities complain vociferously? It was because the NDP introduced the Local Government Grants Act, which promised to provide stability, certainty and predictability. The intent of the act was to have changes in local government transfers limited to plus or minus 2 percent, depending on economic growth in any given year.

With the proposed amendments to Bill 2, we're now looking at decreases of transfers of up to 28 percent, a far cry from 2 percent. Two percent, 28 percent -- move the decimal. I guess that's manipulative accounting on the part of the government. I don't think the people in this province, the people in my constituency or the people in the capital region are impressed by that kind of accounting.

[G. Brewin in the chair.]

The NDP must realize that part of these grants, these municipal transfers, are provided to local governments in exchange for their assuming responsibility for certain functions such as roads and solid waste management. It's too bad that local government can't off-load those responsibilities back to the province when it decides it no longer wants to deal with them.

It is shocking when local government cannot trust Big Brother. How can taxpayers believe Big Brother is telling them the truth when it cannot keep its promises? After all, we all know -- and you've heard this all before -- that 75 percent of all British Columbians believe that this government did not tell the truth when it got elected.

This government sadly believes it can do anything it wants. Is that truly the message that members opposite want to portray to their municipalities? I hope not. This government made certain promises to get elected, so why shouldn't taxpayers expect them to deliver? You made those promises. Instead, we have a Finance minister who proclaims on the front page of the Province : "I Don't Expect You to Believe Me." Well, I don't. So why do we believe that this is where the cuts will end? After all, with the budget speech Thirteen days later, I believe, there was a $500 million debt error. Last year it only took two days to determine that the surplus became a deficit.

The budget also refused to talk about building schools and hospitals. All it talked about was freezing. Raiding ICBC wasn't mentioned, but we know that's coming. And there's not so much as an apology to the people of this province, because if you apologize perhaps they will accept that you cannot keep a promise. Isn't that strange. What we have are excuses that are political election rhetoric. This government lacks integrity, and that is evident in the budget and throne speeches.

I think it's fair to state, though, that no one likes federal cutbacks. No one likes them, I agree. So what is it that you do? You, being government, are supposed to find solutions. You are supposed to look for other ways of reforming government. But what do you do instead? You decide to download onto municipalities.

In the 1996 throne speech the Premier said: "The need for change must be tempered by the need for stability." Well, I haven't seen any temperance, not on behalf of the. . .

An Hon. Member: Nor stability.

I. Chong: That's true. Nor stability.

But I want to go back even further. In the budget speech of April 28, 1996, the former member for Oak Bay-Gordon Head stated that there would be a surplus and that they would be reducing government debt, neither of which occurred. And they stated further in their budget speech that federal funding for British Columbia was being reduced by $435 million for the year 1996-97 and would further decline over the next three years. So in other words, this government knew that there was a current year cutback and a further three-year cutback that they were going to have to deal with. But our municipalities have not been given the benefit of that kind of advance warning.

Also in the budget speech of 1996 -- and I'll quote the Finance minister at the time: "Ottawa chose these cuts to people instead of choosing to eliminate corporate tax loopholes and business subsidies as we had urged them to do." And she said: "I repeat: our government will not pass on these cuts to British Columbians." Well, that was in April of 1996. In June of 1996 the current Finance minister said: "The Premier made a commitment that an NDP government would re-introduce the April budget and make it law." So we were

[ Page 2722 ]

promised in April that you wouldn't pass on these cutbacks. Then you were elected, and subsequent to your election, the new Finance minister said: "We are going to keep that commitment." What are we talking about today? Why is the Local Government Grants Act being amended?

[3:45]

Everyone believes that in order to have democracy, we have to have dialogue. So where is the dialogue? Municipalities are calling. They're asking us to represent them because their members are not standing up and speaking on their behalf. There is neither confidence nor optimism for British Columbians today. And that's a shame, because they expected better of this government, because this government said it could do better.

Further to the budget speech in June of 1996, delivered by the current Finance minister: "At a time when so many provinces are slashing, at a time when Ottawa is dismantling so much of what we have built together, one province is showing all of Canada that there is another way: our province, British Columbia." Well, I don't believe it has shown any other way. It's shown the same way, or it's followed the same way. So I implore the Finance minister to reread his budget speech of last year to see that. If, in fact, he has made a mistake, then perhaps he will apologize to the people of this province.

The KPMG study of provincial-local transfers was recently released. It was commissioned by the UBCM, which I believe we all have a fair amount of respect for. That report stated that there should be a more detailed examination of local-provincial relations, and in that way, perhaps, we can find solutions that are not constantly downloading.

There is a need for a framework to develop fair and equitable financing of transfer policies. Specifically, we need to discuss tax concessions to the province and the inequity that exists in property taxes for hospitals, schools, universities, colleges, provincial prisons, provincial government buildings, B.C. Hydro, B.C. Ferries, B.C. Transit and B.C. Pavilion Corporation. In some cases they are grants-in-lieu; in some, not. Some are relative to market values; others are not. Clearly, there is inconsistency, and the report highlights the fact that there is a need for consistency.

I am concerned that the members representing Victoria are not speaking out on behalf of the loss of their $1.1 million grant. I believe it's gone down to $100,000, and that's a far cry from the required costs that that municipality has in terms of maintenance. This government should be talking with local governments. It should be establishing, where it can, responsibilities between provincial and local governments.

I would like to speak a little further about the proposed changes in Bill 2 to the propane tax. I know a number of other members have spoken about that. I know that the members opposite have a commitment to the environment -- or they say they have a commitment; I shouldn't say that I know they have a commitment. So I have to ask why previous Ministers of Environment haven't asked that their ministry look at supporting a clean-air initiative by converting their provincial fleet. That would be the first step. Good-quality conversion is available.

Therefore the propane tax It is cleaner and safer; reduces the greenhouse gases and emissions, which we're also concerned about; and will, in fact, be a benefit to all of us here in the province. What offends environmental values is the fact that we do not promote alternative fuels.

Interjection.

I. Chong: They don't. I'm sorry. Thank you for the correction, member. This government does not promote alternative fuels and that offends environmental values.

We have received a natural gas exemption for three years, ending December 31, 1999. That ordinarily would be enough, one would expect. But again, that's only three years. How does that provide stability?

Interjection.

I. Chong: Possibly, possibly. Propane should be exempt for the same three years, or as long as other alternative fuels are exempt. Again, people are looking for a bit of fairness, for consistency. They're not receiving it, and they're not hearing anything from the members opposite as to why. They deserve that explanation.

I hear the members opposite beginning to awaken -- just at the time I'm going to conclude, unfortunately. If this government would like us to work with them and the municipalities in the future, I do want to suggest that we engage in a consultative process, that they look for solutions and truly try to reform government, because the passing of the buck is going to have to stop somewhere -- and it's going to have to stop here.

K. Whittred: Three years ago local governments were promised stability, certainty and predictability in revenue sharing with the provincial government. Six months ago municipalities were informed of an average 30 percent cut -- a far cry from the maximum 2 percent cut in grants as prescribed by legislation. Some stability. Some certainty. Some predictability. This off-loading of responsibility is yet another example of this government off-loading its responsibility to someone else.

But today I would like to talk of another off-loading that this government is indulging in. I refer to the off-loading we have seen this past week: refusing, in its responsibility to govern the whole province and all the citizens of this province, to make a decision -- or non-decision -- around the Lions Gate Bridge. After four years of theoretical consultation, we are right back where we started: calling for proposals.

Let's start for a moment with consultation. In the press release, the minister said: "We have asked local governments, the Squamish nation, the regional district and the Vancouver parks board to join us in developing our proposal call." This, according to the mayors of the North Shore, is the first word they have heard in four years. The local municipalities of the North Shore have been completely disregarded in terms of any kind of consultation process -- if, in fact, there has been one.

The municipalities of North Vancouver and the elected representatives have been in a position to constantly be responding to rumours. That, I suggest, is an abrogation of responsibility, and to call for it at this late date is nothing short of simply denying the government's responsibility to make a decision.

The second area I would like to focus on for a moment is what I will call "focus." For anyone who has been around this issue for any length of time -- which, for anyone who has anything to do with the North Shore, is all their life -- will know that this is about transportation. Yet the criteria that are outlined have very little to do with transportation.

In her press release, the minister spoke of this being a complex issue. It is undoubtedly a complex issue. It involves a number of things: transportation, environment, a major park

[ Page 2723 ]

that is of utmost importance to this province, transit, and undoubtedly other things. However, when we look at the conditions that have been placed on this, we see that transportation takes a back seat to all these other issues. The decision surrounding this announcement, I suggest, has put transportation -- and has put the very fact that we are talking of an aging structure that must be replaced -- somewhere down the list behind reducing traffic in the West End. The agenda here has been commandeered.

If I review some of these conditions, I see that one condition is that it must reduce traffic in the West End. I see that another condition is that it must have no environmental impact on Stanley Park. I am further reading from the literature. It goes on to say that it must reduce traffic on the causeway yet have no detrimental effect on Stanley Park, provide benefits for public transit and include a plan to reduce traffic impacts in the West End. How do we do that and still cross the inlet?

An Hon. Member: The NDP think they can walk on top of the water.

K. Whittred: I was going to suggest that it makes it sound as though the people of the North Shore -- and I acknowledge that we are very, very smart people -- are going to have to walk across that inlet in order to meet all of these conditions. It is, quite frankly, an almost impossible task.

I further suggest that in examining the complexity of the issue, the look at the bridge as an aging structure has simply been forgotten. Very much a part of the announcement was that this bridge is going to have to be tolled. This, I suggest, is discriminatory against the residents of the North Shore and is again a way of downloading responsibility on other levels of government and on the taxpayers.

I would like to speak for just a moment on the impact of tolls on business. This is economy. First of all, we will talk about small business. Last year we had a major repair on the other bridge, and we saw -- because of the idiosyncracies, I suppose, of the traffic patterns in North Vancouver -- an almost impossible, idiotic situation where you could not move from east to west in North Vancouver. One of the outcomes of this was that many, many small businesses in fact went under. They could not continue to operate, they could not get supplies, they could not get deliveries; they simply had to close their doors.

What do you think is going to become of small businesses in North Vancouver, where the very lifeblood of the community is small business? If suppliers have to pay a toll of $4 to deliver a part to repair a car, for example, what is going to happen to that business? Someone has suggested they can use the Second Narrows. Yes, perhaps. But what is going to happen to traffic at the other end if only 10 percent of the cars that use the Lions Gate do that? That would be 7,000 cars a day.

[4:00]

The second area that is very much affected is, of course, big business. The North Shore is home to half of the area that we know of as the port of Vancouver. This is vital to not only the economy of the North Shore but to the economy of the entire province. Last week or the week before I had the pleasure to tour one of the major piers that ship lumber. I saw for the first time in my life what we call J-grade lumber being shipped.

I was told that when the transportation systems were so botched up with the repair last year, it cost those companies hundreds of thousands of dollars for delays in their trucks moving in and out to get the lumber in and the product out. So those are some of the impacts that we see.

Interjection.

K. Whittred: The minister opposite is talking about the $70 million. Yes, $70 million is a lot of money. I must point out that the $70 million does nothing more than repair the bridge. Again, that is a government responsibility. It is a government responsibility to maintain the transportation routes of this province. The fact that that bridge is 50 years old and needs a new deck is the government's responsibility. Seventy million does not get any more than a resurface and a paint job.

Interjection.

K. Whittred: It's being pointed out to me that they think this does not have anything to do with Bill 2. I think there is a relationship, because we are talking about off-loading of responsibility, and in Bill 2 this is what we see. We see the government taking from the municipalities that which is expected from the government.

Municipalities have to scramble. In the municipalities that I represent, we see many, many programs -- most of these cultural programs: multicultural programs, art programs and so on -- which are being cut, or at least reduced, because municipal governments have to find savings.

The other off-loading that has greatly affected the North Shore, of course, is Bill 55, the railroad assessment tax. This has affected the district of North Vancouver to the tune of about $800,000, I believe, and the city to about $200,000, for a total of about $1 million. This is in addition to the expenditures which were taken out of the grants.

I will conclude my remarks by once again pointing out that this bill is a blatant example of a government not accepting the responsibilities that it was mandated to accept.

A. Sanders: I rise to speak to Bill 2, and I'd like to start by reading a letter from the corporation of the city of Vernon. The letter is written by Mr. Wayne McGrath, the mayor of Vernon.

"Dear Premier:

"Vernon city council supports the position taken by the UBCM urging the provincial government to take back the cuts imposed upon municipalities earlier this year. The reduction in revenue-sharing grants has dramatically affected the city budget, and has resulted in the layoff of 12 employees. The layoffs include CUPE Local 626 members, firefighters and a management employee. As you can imagine, the decision by council to lay off this number of employees was not reached without a great deal of deliberation and debate. The real impact of the cuts to the city's budget, however, can only be appreciated by hearing from the employees who no longer have a job with the city.

"While city council recognizes that the federal government's cutbacks have severely impacted on the provincial budget, the provincial budget should also recognize that municipalities have no options other than to cut services and jobs, or to increase taxes. As the provincial government is aware, taxpayers have made it very clear that increased taxation is not an option."

As the provincial budget is debated at this time, we would ask you to consider the position of municipalities such as the city of Vernon, and the impact the provincial government cutbacks are having on our employees and citizens."

When we look at the circumstance in Vernon specifically, we're looking at what is called downloading -- a computer term for many, but a nightmare for local governments. In its

[ Page 2724 ]

effort to streamline costs and balance the provincial government, this Premier's government has downloaded fiscal responsibility to municipalities in the form of a cut of $113 million. This has been done under the provision of the 1994 Local Government Grants Act. Not only has this created hardship for municipalities who, unlike other levels of government, are forced by legislation to bring in balanced budgets -- something this government knows scarce about -- but it is also a breach of the legislation that this government has passed, and this legislation prohibits cuts or increases of greater than 2 percent.

Medium- and large-sized communities have been hit the hardest. For example, Vernon lost 41 percent of its funding; Salmon Arm lost 43 percent; Whistler, 79 percent; Kamloops, 55 percent; and the city of Vancouver, 74 percent. This, of course, is before the addition of the highways amount that was later included. This translates into a very real problem for places the size of Vernon. For instance, our council must balance its budget while taking in account a drop of over $500,000 in funding from provincial coffers.

As if this hardship were not enough, this controversy regarding our policing funding also came up at the same time, and will lead to even greater difficulties where we are trying to find the additional costs for four policemen to police the recently annexed area of Okanagan Landing. In 1993 the boundaries of Vernon expanded as a result of the amalgamation with the landing, and Robin Blencoe, the then Minister of Municipal Affairs, outlined areas in which the province would assist the city in its effort to handle additional costs.

In a letter to the city of Vernon, the minister stated that Okanagan Landing were annexed, the Ministry of Attorney General would provide a five-year holiday from additional police costs occasioned by the annexation.

Well, the holiday ran out. Although five years have not passed, the city has been forced to add an additional $480,000 loss from revenue to an already tight budget year. Such downloading has become a trend. For example, municipalities are now responsible for maintaining secondary highways which formerly fell under the jurisdiction of the provincial government. Unfortunately, in areas where such roads experience heavy travel, such as those leading to provincial parks and those leading to major attractions like the Revelstoke dam, the maintenance of those roads must now be done by local government. Go figure.

There are a multitude of other areas where municipalities and regional districts are losing out on promised funding. Every summer it becomes painfully obvious that funding for the control of Eurasian milfoil has not been maintained -- a large problem in Vernon, in addition to the Shuswap, as our member here has many times said. Government promises have largely gone by the wayside, and milfoil remains a serious environmental hazard in our area.

The program to control knapweed on Crown rights-of-way -- the areas alongside roadsides -- has been cut, as has the economic development function of regional districts. Or how about the unfair cut to the downtown revitalization program? This is one of my favourite NDP cuts. This was a low-cost program funded by lotteries, not by taxes. Nevertheless, this government sacrificed this in the name of provincial restraint. It never owned it. It took the money away, and stopped downtown revitalization in important areas in the interior, and it's wrong.

I'm often asked if the B.C. Liberal Party has a better answer. Indeed there were alternatives to the cutbacks outlined above -- for example, a community charter. The proposal in the election policy manual, available in every library, has an example of maintaining current funding levels but allowing 75 percent of all traffic violations collected to remain in the community in a bid to offset policing costs. In the 1993-94 fiscal year this would have meant an additional $56 million in revenues for municipalities -- almost half of the amount cut by the NDP government.

Vernon must presently lobby the Attorney General's office in an effort to reinstate funding for the four policemen promised by Mr. Blencoe several years ago. Faced with population growth and now-finished amalgamation, Vernon needs to maintain its level of policing now more than ever before. The municipality should not have to bear the brunt of broken promises over and over again. Downloading responsibilities are a nightmare for local government, who are doing everything possible to balance their budgets, keep taxation down and maintain services -- an absolutely impossible task for anyone who is working in municipal government.

One of the real problems with the downloading that has occurred to municipalities is that there is no certainty for municipalities. There is no predictability for municipalities. I have not gone into one community where anyone was doing long-term planning. There is no such thing in British Columbia anymore, because municipalities have no guarantee, beyond this year's budget, that there will be any money left for them to do anything of significance on a two-, four-, five- or ten-year plan. That kind of thing has been thrown out the window by this government, and they should be ashamed of themselves for not allowing growing municipalities like Vernon to have that luxury.

I want to read some of the interesting quotes made by government in 1994 when looking at the original Bill 20. The then Minister of Municipal Affairs was quoted in Hansard :

"The review of local government transfers, which we completed in September 1993 with a joint provincial-UBCM working group, led to the development of a new act. Bill 20 is an example of the kind of successful collaboration that is possible when two levels of government sit down and try with certainty, stability and predictability to give municipalities exactly what they are asking for in their relationship with the provincial government."

I think they found what they now accept as the truth, and the truth is that there is no predictability, reliability or ability to long-term plan at all with this government.

[4:15]

Another quote from the then minister:

"This year we revamped the revenue-sharing program to ensure stability and predictability."

There are those nasty words again.

"Bill 20 is still under debate, so I want to say a few words. . .that bear on the estimates here. The Finance minister introduced the new Local Government Grants Act in the budget speech. This legislation will replace a program that has become unrealistic and unworkable. It was ineffective because it didn't deliver certainty and predictability that local governments have requested for some years and desperately need.

"The new act, developed through consultation" -- there's another good NDP word -- "with the Union of B.C. Municipalities, creates a new funding framework for provincial support to local governments. It establishes a municipal general grant base with a formula-driven adjustment to respond to changes in the economy.

"A key feature" -- I like this one -- "of the new act is an innovative clause that commits the government" -- there are some of us who would commit the government, but that's in another life -- "to an annual consultation with the UBCM on grant administration and a thorough review of municipal general grant support every five years."

Well, we haven't got to five years by a long shot, and we've already broken what was the law in terms of the

legisla-

[ Page 2725 ]

tion. "In this way," the minister goes on to say, "consultation with municipal governments will become law." We've seen how good that law was in terms of its elasticity, reliability and longevity. It's lasted from 1994 to now, and municipalities were consulted pretty well at the same time they were having their provisional budgets in, which in any person's language, in any terminology, is not defined as consultation.

"The baseline for the municipal general grant preserves the funding level of the old unconditional grant to ensure that essential local services will still be provided and communities will be able to maintain their stability." Well, that's not what we see for the medium- and large-sized communities that I have mentioned: Vernon, a 41 percent loss of funding from the NDP government; Salmon Arm, a 43 percent loss of funding from the NDP government; Whistler, an 80 percent loss of funding; Kamloops, 55 percent; and the city of Vancouver, 74 percent.

These are losses of provincial revenue to the municipalities by this wonderful law that this government introduced in order to give the UBCM a way that consultation with them, in each municipality, would be law before the amount given to them at that level could be changed.

Hon. Speaker, it's a very unfortunate circumstance to find this Minister of Municipal Affairs stand up -- or the now Premier, who previously stood up -- and call grants to municipalities a guaranteed increase.

I think one of the hardest tasks for this government to overcome will be the loss of face of each MLA in a medium- or large-sized community who has to go back to their community and explain with lies, darn lies or statistics -- whatever the phrase can be -- what they're going to explain to their local municipalities in terms of what happened in Bill 20 and what happened in Bill 2, in order for that money to somehow disappear, evaporate, be nuked and totally gone to the municipalities from where it was procured. It's supposed to go back to them. They deserve it. It's money raised in those areas.

And this government is taking that money because it can't balance the books, it can't balance the budget, it can't run a province.

J. Weisbeck: Thank you, Madam Speaker, for the opportunity to speak to Bill 2, the Budget Measures Implementation Act. This bill affects two municipalities in my riding of Okanagan East: the city of Kelowna, which I share with the riding of Okanagan West; and the newly formed municipality of the district of Lake Country.

This change in transfer payments stated in Bill 2 has affected both municipalities, even though their percentages are somewhat different. Kelowna, for example, has a 42 percent reduction, totalling $2.2 million, and the district of Lake Country has an 18 percent reduction, totalling around $75,000. Both have the task of determining whether to raise taxes by 3.5 percent or cut services. This is currently being decided at this time.

Lake Country has had a lesser percentage impact, but as a new community, just incorporated in May 1995, this current decision by the NDP has left them very concerned about whose side this government is really on.

The district of Lake Country is comprised of Winfield, Oyama, Okanagan Centre and Carr's Landing. Its current population is around 9,000 people. It's bounded on the north by the regional district of North Okanagan and the city of Vernon, on the east by large tracts of Crown land, on the south by a partially serviced city of Kelowna industrial park and the populated Indian reserve No. 7, and on the west by Okanagan Lake.

Rapid growth in this area has created huge demands for services on this new municipality. One of the major concerns identified by their official community plan is a new sewer system. They've limited the sewer system to an urban containment area, and it's currently under design.

In the past, municipalities relied on a certain level of provincial funding: an opportunity to get some of the taxes collected by municipalities back into the community, and an opportunity for municipalities outside the lower mainland to feel they are getting a share of the taxes collected. Because municipalities have only one source of taxation available to them under statute, grants in the past have provided a stable and predictable revenue source. Well, Bill 2 changes all that. It changes the grant structure, removing stability and the predictable revenue source.

This is another form of downloading from the province to the local taxpayers, taking the heat off the provincial government and putting it onto local governments.

In a town hall meeting on March 25, the district of Lake Country discussed the options for making up this shortfall. They thought that by either reducing service levels, increasing taxes, increasing user-pay functions that are self-liquidating, increasing sales of services or becoming more innovative and creative they could resolve their problems.

At that meeting, as well, a report on the impact of the grant cuts was discussed, and I'd like to quote from that report:

"Further to this downloading, the province is cutting several grant programs which will further the tax burden to local taxpayers and/or eliminate local services. These programs include police transition assistance, secondary highway grants, independent police equalization, downtown revitalization and grants in lieu of taxes for some provincial institutions. As well, certain arterial highways will be declassified as local government highways. Thus, maintenance and bylaw enforcement will become a local responsibility.

"The provincial cuts have been applied without the promised consultation with municipalities and are a classic case of downloading. They were delivered unilaterally, and specific municipal circumstances were not considered. This cut compounds the impacts already identified from the provincial government action to give property tax breaks to major railways, to eliminate services that were available in many communities and to cancel valued programs, all on the backs of local taxpayers.

"Further, no consideration was given to the soft costs of the cuts -- i.e., job losses, increased crime, increased tax burden and loss of valued services. Core services such as fire and police, sewage and garbage disposal, road maintenance, drinking water, parks and recreation are jeopardized by these arbitrary provincial cuts. The provincial decisions were all delivered without sufficient notice to communities."

The district of Lake Country is a new municipality requiring help and special consideration. This is not a time to pull the rug out from under them. They're also realizing some of the indirect downloading costs such as wildlife suppression. Originally this was covered by Forestry. If a fire should occur in Lake Country, it could add up to $30,000 to $40,000 to their budgets.

There have been a number of references by this government to commitment. The throne speech refers to it: commitment to health, commitment to education. Well, commitment has become a very empty word, particularly to the citizens of Kelowna. In 1973 the NDP government of Premier Dave Barrett, without consultation, forced the city of Kelowna to amalgamate with several outlying communities, enlarging the city from eight square miles to 88 square miles. The NDP government at that time made the commitment to pay for the maintenance of 160 kilometres of rural roads. They are now withdrawing this commitment.

Kelowna, because of their excellent planning over the years and because they have positioned themselves with some

[ Page 2726 ]

flexibility built into their budgeting process, will still have an increase of 3 to 31/2 percent in taxes this year, only because they've got the reserves in place and they have the ability to tighten up other areas in their budget. They will not be cutting services, but they will be increasing user fees and increasing revenues in other areas. They have cut staff. They didn't fill six vacant positions and they laid off one individual.

But in actuality, because a user fee is really a tax, the actual tax increase will be 5 to 5-1/2 percent this year to account for this downloading -- the cost of inflation just to maintain these services. So the administration is very, very concerned for next year, when the true impact of the downloading will take place. This year there was enough flexibility to absorb these increases.

The province has walked away from an amalgamation agreement with the city of Kelowna. This commitment is further aggravated by the fact that rural roads are servicing ALR lands, an NDP policy which has had far-reaching impacts. Kelowna is looking for a level playing field. Kamloops was given the opportunity to negotiate their way out of their amalgamation agreement. Kelowna would like the same consideration. They would like the opportunity to discuss with the province the takeover in 1998 of rural roads. They would like this government to live up to their original commitment of 1973.

The city of Kelowna should receive the same treatment as the city of Kamloops if the rural roads become their responsibility. There should be a lump sum payment for the maintenance of these roads. Or are we just going to continue the saga of one broken promise after another?

This government continues to hang their fiscal mismanagement on the federal government. I would like to quote the conclusion from the analysis of intergovernmental transfers, written for the Union of British Columbia Municipalities:

"The reduction in intergovernment transfers started with the provincial government reducing funding to municipalities in 1982. Reductions in federal transfers to the province did not start until 1988. In terms of significance, over the 15 years since 1981, the reduction in transfer payments has been greater for municipalities than for the province, no matter which of the three measurement methods is used. The notion that municipalities were somehow protected from federal transfer reductions is not supported by the evidence.

"There will be a significant reduction -- 30 percent -- in federal transfers to the province over the next two years -- 1996-97 and 1997-98. This will be matched by a similar reduction -- 30 percent -- in transfers from the province to municipalities, but over only a one-year period. The province was given at least two years notice of the changes, municipalities were given one month. With respect to future transfer payments, municipalities will be treated more harshly by the province than the province will be treated by the federal government."

This government continues to have a huge impact on the municipalities of British Columbia. The NDP have created a situation where there's no obligation to provide grants in the future, there's no predictability and there's no certainty. By downloading their responsibilities, they have created a breach of trust.

What sort of a message is this government sending to the district of Lake Country, which after less than two years after incorporation, is having their funds cut? This level of downloading is further indication of the level of mismanagement this government has created -- $113 million worth of mismanagement. The timing of the announcement further supports the claim that this is an uncaring government. They were more concerned about the announcement of this downloading not impacting their NDP candidates in the last municipal election than about giving municipalities the time to respond. One must ask: whose side are the NDP on?

[4:30]

An Hon. Member: In the next election, the losing side.

J. Weisbeck: You better believe it.

Property taxes affect everyone in this province. The very people the NDP claim to protect are the ones most affected.

Interjection.

J. Weisbeck: Well, I have a challenge to the Minister of Municipal Affairs. I'd like to challenge him to stand up at the next UBCM convention and defend the actions of his government. It is no wonder the public is so cynical about this government.

The impact of Bill 2 on my riding, like every other riding in British Columbia, is profound. The city of Kelowna, the district of Lake Country will have to work and ask their citizens to dig even deeper into their pockets for the debts created by this government. These types of bullying tactics not only destroy the lines of communication between governments but also, more particularly, destroy the faith of the people we are elected by and must be committed to serve. We live in a world of uncertainty, but this government has certainly made British Columbians aware that we live in a very uncertain time.

B. Barisoff: I would like to take this opportunity to express my thoughts regarding Bill 2, the Budget Measures Implementation Act, 1997, which is now before the House. At the risk of repeating important points that have already been made by my fellow colleagues, I feel it's my duty, on behalf of my constituents in Okanagan-Boundary, to add my voice to those in opposition.

The citizens of British Columbia elected 75 representatives from around this great province to listen to their concerns and to act on their behalf, to conduct ourselves with dignity, to provide good government and to bring constructive criticism to these chambers so that together we can accomplish the best that is possible. I have no reason to doubt that the hon. members on the opposite side do not share this obligation of trust.

I have to honestly say that these are difficult financial times, and we are all being asked to do more with less. Any government in power has to face enormous challenges. There is the necessity of maintaining a balance between sound fiscal management and a social conscience. There are some hard choices to be made, and there is no doubt that there will be some short-term pain in order to accomplish long-term gain. I'm sure that my colleagues and the hon. members across the House would agree with me. So recognizing these factors, I commend the government for taking the time to do some necessary housekeeping on many of the items in Bill 2 as they accomplish that.

I support some sections in the new bill. It improves disclosure relating to staff utilization and identifies all full-time-equivalents, as they are paid directly from the consolidated revenue fund. There are a number of items in Bill 2 which demonstrate an effort to simply put our house in order: standardizing appeal periods, equalizing the tobacco tax, increasing minimum refunds payable, and so on.

Where I have a problem, and it remains a little bit of Mary Poppins If you remember the song, a teaspoon of sugar helps the medicine go down. Well, I'm afraid that there are some parts of Bill 2 which I cannot support with good conscience, because not only is the medicine too strong, but I honestly believe it's bordering on arsenic.

I'm primarily concerned about three areas, and I cannot in good conscience support them. The first one deals with the

[ Page 2727 ]

motor fuel tax; in particular, the removal of the tax-exempt status from propane used by motor vehicles. The fuel becomes subject to a social service tax of approximately 2.2 cents on June 1, 1997. I would ask that the government reconsider this for the following good reason: the government promised no new taxes. This, in itself, is reason enough. We tell our kids that a promise is a promise, and I'm sure that the hon. members would agree that keeping that kind of trust is critical to our character and integrity.

The government has broken another promise. They have not only lost credibility with the taxpayers and voters of this province, but they are also so arrogant and arbitrary with their actions that they don't seem to realize how much they have eroded that trust. The government likes to play a game with words, with allusion and with clever manipulation, thinking that the people won't realize what they are up to. Just to support what I have said, no new taxes sounds pretty simple, doesn't it? It wouldn't be hard to misinterpret the intent there.

This government has painted itself into a corner financially, but it has promised no new taxes. I repeat: no new taxes. However, they are desperate for revenue, due to poor fiscal management. So what do they do? They

An Hon. Member: How do you explain the best track record in the country?

B. Barisoff: I think it's going down. If the hon. member would look, I think we're going down.

No new taxes. They've increased anglers' fees; they've increased ambulance fees; and they've raised estimate fees, just to name a few things that are taking place. "Oh, but that's not taxes," they cry. Tell that to a taxpayer who has to take it out of his pocket. Webster's Dictionary defines taxes as payments imposed by and collected from individuals or business by the government. Now, that's taxes.

What do we think the taxpayers call these increases? I think the taxpayers call these increases taxes. Just what are they? I think they're a backdoor tax grab. I strongly urge this government to re-examine its actions in regard to the propane tax -- I repeat, tax -- just on the principles of trust and integrity alone.

One constituent writes from Prince George, from a taxicab holding company. May I quote what he put in the letter, hon. Speaker? He says:

"Should this proposed tax be put in place, many current users would revert back to gasoline, not by choice, but for strictly economic reasons. At one time the investments made to convert to propane, $1,200, could be recouped within an eight- to ten-month period of operation. With the current pricing -- in excess of $3,000 -- it now requires over two years of operation before you receive any return from your investment. A further increase in the cost of fuel, tax or otherwise, will expand that period beyond the life of the vehicle, and makes it unfeasible.

"The cost of a car conversion, coupled with the uncertainty of fuel costs, has effectively reduced the number of alternative-fuel vehicles operating within our fleet. We currently have 46 propane cars, eight CNG cars and eight cars operating on gasoline. All of the vehicles placed into service over the past months have stayed on gasoline."

That's what's happening. We're finding that this government, which proposes to look at environmental problems, is turning a blind eye on these by increasing the tax.

That's just one of many letters which clearly show the real world and how it operates. People have reached the wall in accepting taxes and fee increases. As I said before, I think fee increases are nothing more than a backdoor way of getting taxes. It all comes from one pocket, and a tax by any other name is still a tax.

There are other reasons to reconsider. As propane has many more environmental benefits, like natural gas and ethanol, it would be appropriate that propane consumers be treated similarly to other alternative-fuel consumers. It would have been prudent But mind you, with this government it's hard to say when they're prudent -- to use that famous word; I think I used it before. It would have been prudent and much more credible to advise a future phase-in tax program for all alternative fuels commencing at the same time.

I believe consumers realize that the status quo cannot remain indefinitely. But again, this kind of quick grab does little to restore the credibility of government. I think there's little

Interjection.

B. Barisoff: I think we've really got to start looking at credibility. I think if the hon. member from the other side would think about that, we'd start thinking about what we're doing.

I received dozens and dozens of letters from propane suppliers and users around the province, pleading with us to oppose the tax on propane at this time. Many citizens describe the expense they had in going into conversions. Suppliers argue that a tax now would seriously impact the industry, reduce incentives and have a negative impact on small business -- and as we know, members from that side of the House aren't that concerned with small business in the province. He also suggested that if and when the tax revenue is realized, a fund should be established for propane-conversion incentives.

A research and development fund should also be established to encourage new designs and the development of tomorrow's propane vehicles.

The industry itself would be willing to assist the government with administration of conversions and a propane-vehicle decal program. The industry is obviously willing to cooperate to solve problems. Together, they would like to be consulted and included in the problem-solving. I think the word "consulted" is important here, hon. Speaker, because sometimes the government members on the opposite side of the House forget that they should consult with the people of British Columbia when they do something.

This government is in the habit of treating British Columbians with contempt by continuing to take arbitrary actions without proper consultation. Nowhere is their lack of consultation or contempt for the voters more apparent than in the portion of Bill 2 which deals with the Local Government Grants Act.

[4:45]

R. Neufeld: What's the definition of "consultation?"

B. Barisoff: I think, hon. Speaker, that they should look up what the word "consultation" means.

Despite a protocol agreement signed in September of 1996, the NDP government has seen fit to slip in a provision here which will remove the obligation to pay unconditional grants to municipalities. I would just like to repeat that whole thing again: despite a protocol agreement signed in September of 1996, the NDP government has seen fit to slip in a provision here which will remove the obligation to pay unconditional grants to municipalities.

I hope they listened to that. It's a serious statement. It allows for unconditional grants to be granted by the ministry

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in accordance with specific criteria as detailed or prescribed by regulation. I hope they're listening to that: prescribed by regulation. It's signed by the NDP government. In other words, this government can do what it wants -- which it seems to be continually demonstrating -- when it wants, how it wants. I think the other day we heard a minister say they can do what they want, when they want.

[The Speaker in the chair.]

This is another broken promise in a long series of broken promises. This government has

An Hon. Member: Tell the truth.

B. Barisoff: Tell the truth? I'm telling the truth about broken promises. If the hon. member would pay attention, there are many broken promises. I'm just naming a few. This government has no credibility with the municipalities of this province -- and I mean none, hon. Speaker, no credibility whatsoever.

It's true that the federal government has downloa