1998/99 Legislative Session: 3rd Session, 36th Parliament

HANSARD

The following electronic version is for informational purposes only.

The printed version remains the official version.

Official Report of

DEBATES OF THE LEGISLATIVE ASSEMBLY

(Hansard)

MONDAY, MAY 17, 1999

Afternoon

Volume 15, Number 5

[ Page 12495 ]

The House met at 2:10 p.m.

Prayers.

S. Hawkins: I have some constituents who are joining us here in the gallery

today, and I'll be meeting with them later this afternoon. They are Mr. Al Clark, Mr.

Gordon Ivans and Mr. Pete Steeves. They're tree fruit growers who are very concerned about

the orchard industry, and they're here to let the government know that. Would the House

please make them welcome.

J. Weisbeck: Along with the same group that the member for Okanagan West just

introduced are Sheila Ackerman, Nicole Ackerman, Sandy Shaw, Gerry Shaw and Brian

MacDonald. They're very important citizens from my community, who are down here expressing

their concerns for the apple industry as well. Would the House please make them welcome.

S. Orcherton: I notice in the gallery that Mr. Dean Fortin is with us today. Mr.

Fortin works very hard on behalf of the Burnside-Gorge Community Association in my

constituency. He does tremendous work there and has elevated that community association to

one of the best, if not the best, in the greater Victoria area. I ask the House to make

Mr. Fortin very, very welcome.

Hon. J. Kwan: It's my pleasure to introduce today Rowan Smith, a 15-year-old

student from St. Andrew's Regional High School here in Victoria. He is doing a work

experience this week in my office in the Ministry of Municipal Affairs and is interested

in learning about politics and governance, especially in the area of municipal planning.

Would the House please make him welcome.

W. Hartley: I see up in the gallery today a good friend, George Berpicebich.

He's a professional photographer and human rights advocate who was very helpful in helping

me bring to this Legislature the debate on Burma a while back. Would members please

welcome him.

B. Goodacre: In the gallery today we have with us His Worship Brian Northup, the

mayor of the town of Smithers, and the town administrator, Mr. Wallace Mah. They are here

to visit with government ministers to bring them up to date on the issues in their area.

I'd like the House to please make them welcome.

Hon. D. Lovick: Madam Speaker, it's my unfortunate and unhappy responsibility to

advise the House of the untimely passing of a man well known to many of us in this chamber

-- namely, Mr. Gerry Stoney. Gerry Stoney was the president of the New Westminster and

District Labour Council for many years and then went on to become president of IWA Canada.

He had been fighting his battle with that great killer for many years and, alas, succumbed

much too young for that to happen. He was a fine man who left, I think, a very significant

imprint on industrial relations in this province and made huge contributions. If I might,

Madam Speaker, I would ask if you might be kind enough to offer our condolences from the

chamber to Gerry's family.

The Speaker: I'd be happy to. Thank you, Mr. Minister, for that information.

G. Abbott: On behalf of the official opposition I would like to join with the

hon. minister in also sharing our concern about the passing of Mr. Stoney. As the Forests

critic I had the opportunity to meet Mr. Stoney a couple of times during his years as the

head of the forest workers, and he did a strong and commendable job on behalf of that

organization. Certainly we'd want to join in bringing those thoughts to Mr. Stoney's

family.

[1415]

The Speaker: Thank you very much, members. On behalf of all of you, I'll be happy

to do that.

Oral Questions

WHALE HUNTING AND ABORIGINAL TREATY NEGOTIATIONS

G. Campbell: My question is to the Minister of Aboriginal Affairs. Today the brutal

and agonizing spectacle of the killing of gray whales by the Makah whale hunters has been

seen around the world. British Columbians want to know that hunting will not be on the

treaty bargaining table, no ifs, ands or buts -- not for commercial, not for customary and

not for ceremonial purposes. Will the Minister of Aboriginal Affairs commit today that

under no circumstances will the hunting and killing of whales be on the negotiating table

in the province of British Columbia?

Hon. G. Clark: I want to be clear. For the record, we've given instructions to

our negotiating team that they are not to sign a treaty or an agreement-in-principle that

contains provisions for whale hunting. Even though this area is a matter of federal

jurisdiction, because the treaty process is a tripartite process and because the

provincial government is at the table, we will not sign any agreement nor entertain any

discussion about going back to the past and allowing any whale hunt in British Columbia by

aboriginal people.

The Speaker: First supplementary, the Leader of the Official Opposition.

G. Campbell: On this side of the House I'd like to say that we welcome those

comments from the Premier. Let me say, however, that there has been some confusion created

over the weekend, when the Premier's Minister of Aboriginal Affairs said that he certainly

wouldn't undertake to have any negotiations with regard to commercial uses but that it

might be necessary to negotiate with regard to customary or ceremonial uses. I want this

to be clear and unequivocal. I ask the Premier today: has he instructed his Minister of

Aboriginal Affairs that under no circumstances -- not custodial, not customary, not

ceremonial -- will the killing and hunting of whales be allowed at the negotiating table

in the province of British Columbia?

Hon. G. Wilson: There is no confusion at the negotiating table. Whale hunting is

not on the table. It has not been brought to the table by any first nations, and neither

do we anticipate it to be so.

[ Page 12496 ]

The Speaker: Second supplementary, the Leader of the Official Opposition.

G. Campbell: The confusion that has been caused here -- the Premier was clear

last November that whale hunting would not be on the table -- is from this Minister of

Aboriginal Affairs . . .

Interjections.

The Speaker: Order, please. Let's hear the question.

G. Campbell: . . . saying to the Globe and Mail that B.C.

Indians probably have the legal right to hunt whales. Hon. Speaker, we do not believe that

they do. We think it's wrong for the minister to suggest that they do, and we wonder how

on earth the minister or the Premier thinks that that's the way to carry forward if we are

going to prohibit the hunting and killing of whales in the province of British Columbia.

Hon. G. Wilson: The only confusion that may exist in the members opposite is the

fact that marine mammals are federal in jurisdiction. We happen to not believe that there

is a legal right, either. It is up to the federal minister, hon. member, to . . .

Interjections.

The Speaker: Order, members.

Hon. G. Wilson: . . . make a decision with respect to non-treaty

rights.

Interjections.

The Speaker: Members . . . .

Hon. G. Wilson: The issue is not on the treaty table; it has not been brought to

the treaty table. And the province has made it clear that we will not negotiate it at the

treaty table.

Interjections.

The Speaker: Order, please.

MINISTER'S CHARACTERIZATION OF PEOPLE LEAVING B.C.

C. Clark: Last Friday the Minister of Aboriginal Affairs said that people who move

to Alberta looking for work are like chickens running away, buggering off. I have a letter

from one of those people. He's a 26-year-old forest worker who is unemployed in British

Columbia. He sent out 900 r�sum�s, and the only responses he has gotten are from

Alberta. Why would the minister call someone like this a chicken for going to find work in

Alberta when there are no jobs for him here in British Columbia?

[1420]

Hon. G. Wilson: The member makes reference to a quote I was making from Monty

Python's Brave Sir Robin, which I know that that member, from her days as a young Liberal,

used to watch frequently.

Hon. Speaker, what I said was that people in British Columbia need to stand to build a

province, that we on this side of the House are building an economy and building a future

-- and we are building a future for British Columbians. Those people . . .

Interjections.

The Speaker: Members . . . .

Hon. G. Wilson: . . . who choose to stand with this side of the

House to build a future for our children are welcome to do so. Those are the people who we

on this side of the House are working with very carefully on a daily basis.

The Speaker: First supplementary, member for Port Moody-Burnaby Mountain.

C. Clark: Yeah, I get it, hon. Speaker. The NDP . . .

Interjections.

The Speaker: Order!

C. Clark: . . . popularity in the polls isn't dead; it's just

resting -- right?

Interjections.

The Speaker: Order, members. The House will come to order.

C. Clark: Josh Rudolph is 26 years old. He has worked in British Columbia since

he was 14. He doesn't want to leave. Unfortunately, if he stays, all he can look forward

to is a welfare cheque and a minister that calls him chicken because he can't find a job

at home. Why is the minister lashing out at people like Josh Rudolph when it's his

government's economic policies that have forced people like Josh to go find work in places

like Alberta?

Hon. G. Wilson: Let me extend an invitation to Josh to phone members on this

side of the House, where he will learn that there have been 58,000 net new jobs. If Josh

would stop listening to the members on that side of House, he might realize that there's a

very real future in British Columbia. So come and talk to members on this side of the

House -- and he will have what he needs for his future in B.C.

G. Plant: The Minister of Aboriginal Affairs can try to hide from the facts, but

the facts are that last year over 20,000 people left British Columbia looking for jobs in

Alberta. Instead of looking for solutions to stop this crisis, the Minister of Aboriginal

Affairs takes cheap shots at the people who are the victims of his government's economic

policies. My question for the Minister of Aboriginal Affairs is this: if he wants to take

a progressive step forward in fixing what's wrong in British Columbia, will he stand up

right now and apologize to everyone that he insulted with his remarks?

Interjections.

The Speaker: Order, order!

Hon. G. Wilson: What utter nonsense from the members opposite. What utter

nonsense! There have been 58,000 net

[ Page 12497 ]

new jobs into this province announced in the last year. Louisiana-Pacific and Tembec

have come in. Telus has moved its headquarters over to British Columbia. The economy is

building here. The only members who put out a negative, negative, negative message about

this province are those members opposite. They continually do it, and in so doing, they

drive people away from this province instead of bringing them forward here and helping to

build this new province.

The Speaker: First supplementary, member for Richmond-Steveston.

G. Plant: Now the Minster of Aboriginal Affairs has learned the first principle

of NDP politics: it's not their fault that there is a recession in British Columbia; it's

the official opposition's fault. The minister doesn't get it. When he stands up and

accuses of being chickens the people who leave this province because of his economic

policies, he hurts and insults them. Will the minister stand up now and apologize for what

he said?

[1425]

Hon. G. Wilson: Hon. Speaker, I will never apologize for inviting people to come

and work with this government -- to work with British Columbians to build a province. We

have seen an investment in Western Star Trucks. The members opposite say: "No good.

We don't want that." We have seen Tembec coming into this province. The members

opposite say: "No good." They don't like that. Louisiana-Pacific -- the members

opposite said: "Oh, that's not enough. That's small potatoes."

The only people who constantly send out a negative message about British Columbia are

those members opposite. If anybody needs to apologize, it's those members -- not the

members on this side of the House.

G. Farrell-Collins: Those 20,000 people -- those 20,000 British Columbians and

their families who left British Columbia to go to Alberta and other jurisdictions -- are

not imaginary people. They didn't leave from imaginary towns in imaginary parts of British

Columbia. They're real families and real people, and that minister has the gall to stand

up and accuse them of chickening out and buggering off and abandoning British Columbia.

Those are people who want to be in British Columbia but can't stay, because of the

economic policies opposite. Will the minister stand up and apologize for those comments?

Interjections.

The Speaker: Order, members.

G. Farrell-Collins: It's a pretty inauspicious launch to a leadership campaign,

when the future leader of a party stands up and insults British Columbians who have had to

leave their province because of the disastrous economic policies created by his

government.

Will the minister go to communities like Gold River? Will he go to places like Logan

Lake and tell the British Columbians that are going to have to leave next week and next

month and next year that they're a bunch of chickens and are buggering off -- for not

having faith in the NDP's ability to turn around the economy? Or will he go there and

apologize to them for those outlandish comments?

Hon. G. Wilson: It really is a tragedy when the members opposite can come up

with this in question period. They've got 15 minutes to question the members here on real

and tangible issues. It is bizarre in the extreme that they would spend an entire 15

minutes trying to question this.

But for the people of Gold River and those other resource-dependent communities .

. . . The members on this side of the House are working with those people. There

are job transition programs in place. This government is starting to make movements with

respect to building the economy. I will invite any British Columbian who wants to work to

build this province, to stand with us on this side of the House rather than get steeped in

the negativity of the members opposite.

ACCESS FOR SMALL CONTRACTORS TO HIGHWAYS WORK

G. Abbott: The biggest thing that's bizarre in this province is the policies of

this pathetic government that we've had for eight years. That's the most bizarre thing.

One more bizarre instance. Last week I met with 30 non-union contractors in the

Shuswap, some of whom have up to 35 years of work on a day-labour basis with the Ministry

of Transportation and Highways. Now they've been told that they must unionize with HCL if

they and their 150 employees want to work on the Trans-Canada Highway corridor right in

their own back yard. To the Minister of Transportation and Highways . . . .

Interjections.

The Speaker: Members, members.

Come to the question, please.

G. Abbott: They are local; these 150 are local.

Interjections.

The Speaker: Order, members. We'll hear the question.

G. Abbott: Why is this NDP government forcing local businesses out of business

in order to force the unionization of the highway construction sector?

Hon. H. Lali: The members opposite . . . . When we were building the

Vancouver Island highway project under HCL, they were all clamouring that they wanted to

see jobs in their local area throughout the interior and the northern part of British

Columbia. And here's a golden opportunity for his constituents -- for that member's

constituents -- to find work on projects under HCL, which is local hire within a

100-kilometre radius and is creating jobs in that member's constituency. I'd like to ask

the member opposite a question: what is he suggesting -- that we should be hiring people

from Alberta to work in his constituency?

[1430]

The Speaker: First supplementary, the member for Shuswap.

[ Page 12498 ]

Interjections.

The Speaker: Order in the House, please.

G. Abbott: A neighbour of mine in Sicamous, Clayton Hoban, owns Hoban

Construction, a small highway construction firm that's done business in that area for 17

years. Now he's going to be calling in the auctioneers and liquidating his assets because

he can't get work under this government's closed-shop HCL model. Can the Transportation

minister explain to the owner of this small Sicamous business why he and his 15 employees

are being shut out of government contracts just because his employees don't want to join a

union?

Interjections.

The Speaker: Order, members. Come to order.

Hon. H. Lali: It is really tragic when you have that pathetic opposition sitting

on those opposite benches who are talking about giving jobs to people in Alberta; we've

got those people, sitting on the opposite benches.

Under HCL, for the first time in Transportation and Highways projects, you've got

people who are from visible minority backgrounds getting jobs, women getting jobs on these

projects under HCL, people who are also from the aboriginal population of this province --

and also training and apprenticeship. All of these people are being hired for the first

time on transportation construction projects.

And those people again want to go back to the way things were 30 years ago and make

sure that people from Alberta are getting jobs here instead of the local people in that

member's constituency.

Orders of the Day

Hon. J. MacPhail: In Committee A, I call Committee of Supply; for the information

of the members, we'll be debating the estimates of the Ministry of Fisheries. In this

House, I also call Committee of Supply; for the information of the members, we'll be

debating the estimates of the Ministry of Energy and Mines.

The House in Committee of Supply B; W. Hartley in the chair.

ESTIMATES: MINISTRY OF ENERGY AND MINES

AND MINISTRY RESPONSIBLE FORNORTHERN DEVELOPMENT

(continued)

On vote 25: ministry operations, $35,483,000 (continued).

[1435]

R. Neufeld: Last Wednesday, when we left off, we were nearing the very end of the

northern commissioner . . . . So I just have a few quick questions to finish

off that debate on the northern commissioner.

The minister wrapped up arguments saying that, in fact, the reason that no money was

put into telecommunications infrastructure in the north was because of the federal

government deciding to spend their money elsewhere -- that being Douglas Street. In fact,

if I go back to Hansard , that's where I find it. I just wonder . . . .

The minister made some statements about the fact that when he was minister of his last

ministry -- Employment and Investment -- he had signed up all the agreements along with

the Western Diversification officials. They had signed off on it for this infrastructure

money. It went to David Anderson's desk, and he refused to sign it. I wonder, just for my

information -- and I appreciate the minister telling me -- if he would give me the

agreements that were signed -- obviously they must be on file someplace in the minister's

office, or he can access them for me -- that he had requested the federal government to

sign on to and they didn't.

Hon. D. Miller: I'm not certain what was in fact signed off, but I'd be happy to

-- in fact, I will -- arrange a briefing with the provincial staff who are on this file so

that I can walk the member through all of the projects that we had wanted to do in British

Columbia. We were trying to strike a balance so a reasonable amount of the infrastructure

money was spent in rural British Columbia.

There were some difficulties with the program. I'd just remind the member, going back,

that when it was initially announced, the federal government said: "This is a

one-year program only." All disbursements had to be made in the fiscal year in which

the program was announced. We therefore -- knowing that you can't go out and ramp up that

quickly, if you take my meaning -- searched for projects that we knew we could flow the

money to in the fiscal year, as originally prescribed by the federal government.

We also argued with the federal government that it didn't make sense, that we ought to

be given a bit more time to try to encourage communities, local governments and other

groups to get some applications in. Given the criteria of the funding -- the one-third,

one-third, one-third provisions -- we had to tailor our approach to what we thought was

doable and had the most impact right around the province. I think we did a major transit

initiative in Kelowna, if I'm not mistaken.

But my point that I was trying to make last week was this: we, in good faith, put

forward a list of projects that we thought represented a pretty good balance around the

province. I was particularly concerned because -- if my memory serves me correctly --

there were some 30-odd communities around British Columbia that didn't have telephone

service. I thought it was important that we try to allocate a little bit of that money --

not a lot, a little bit of that money -- to try to improve the position of these small

communities.

What ultimately happened was that, at the officials' level, I was informed there was a

notional agreement on the list of projects between federal officials and provincial

officials. Yet we reached an absolute impasse when dealing with Mr. Anderson. It was

fairly well reported at the time, unfortunately -- and that's a sure sign that things are

breaking down. But Mr. Anderson was adamant about that. As a result, some of those

projects did not proceed. So I'd be happy to provide the member with a detailed briefing

on all aspects of that issue as soon as we can arrange it and at a convenient time for the

member.

[1440]

R. Neufeld: I appreciate that. I'm not trying to make an issue out of it. What I

would like to do is have the information that the minister talked about. He's correct in

saying -- as I understood it -- that the money had to be expended that year,

[ Page 12499 ]

and Douglas Street is just being done this year. Those kinds of things, all of a sudden .

. . . I know you were Minister of Employment and Investment over two years ago, so

I'm wondering what took place there.

Actually, I want to pursue it a bit too. Not that I have any influence -- I can

guarantee you that -- but I certainly do want to see some of the infrastructure upgraded

in the north, regardless of which part of the north it is -- for the whole north. That was

my wanting to get the information from you a little bit more so that I could do that.

Hon. D. Miller: Just to complete . . . . I did not deal with that

specific issue. Despite their initial position that it had to be a one-year program only

and despite the entreaties we made to do it over two years . . . . There was

no response to that, but ultimately the federal government did -- I can't remember exactly

when it was -- agree and did convert the one-year program to a two-year program.

R. Neufeld: I look forward to that briefing and that information.

Just a couple more questions with regard to that same issue. In your spring issue of

"Report to Northerners," there is a blocked-off part that talks about $10

million -- or a certain amount of money, I should say -- to the provincial learning

network, northern British Columbia and upgrading technology. Can the minister maybe just

give me a brief outline of where that money is going to be spent? Is it across the whole

north? Is it specific to one area? Is it the north? Is it more the interior? Or is that

$10 million spread across the whole province?

Hon. D. Miller: The $10 million, I believe, applies broadly across the province.

The reference to telecommunications came about -- and I think I said this in the House

last week -- as a result of a discussion held between me, the Minister of Finance and Mr.

Backhouse. The Minister of Finance and I talked quite a bit. She said: "Look, there

is not a lot of room, but I'm interested in seeing how I can allocate a little bit of

money that might be useful in the regions and particularly in the north. What are your and

Mr. Backhouse's views of what might be an appropriate area of expenditure?" It was

really Mr. Backhouse who led, saying that if there were any resources at all,

telecommunications was an important area. So without predetermining the scope of the

spending or indeed the discrete areas where that might be deployed, the Minister of

Finance kindly agreed -- and I thank her for that -- to include that reference, and an

allocation that obviously now requires further discussion.

Again, I'm quite happy, once I've had the opportunity to do that with the Minister of

Finance, to discuss with other northern MLAs areas where they see priorities. All of that,

of course, depends on just how much is available, but I think -- looking at the broader

issues around telecommunications -- that completion of the PLNet obviously will improve

the situation for northerners. But I do think that there are significant issues around

telecommunications where . . . .

[1445]

I indicated last week that the provincial government had made a submission to the CRTC

hearing in Prince George at some point last year. They were worried about competition

coming to local telephone service and about what the impact might be on small communities

because of the high cost of putting the infrastructure in place and the low population

base. Our recommendation was that the CRTC establish a discrete fund and that a piece of

the revenue obtained by telecommunications companies go into this fund. That fund could be

used, I presume, right across . . . well, certainly British Columbia. But if

it were to be adopted as a national standard, that fund could be used as a constant source

of revenue to continue to try to improve and upgrade the northern telecommunications

infrastructure.

I don't believe the CRTC has made a ruling on that point yet. I could check on that. In

fact, if the member or other northern members want to lend their support to that approach

or that method, if you like, then certainly we would appreciate any assistance. I do think

there is a looming problem. The member knows exactly what I'm talking about. I see three

northern members sitting across the way, and while they know that there have been benefits

as we've moved to become a much less regulated society, I think they understand as well

that there is a price to pay in the remote regions.

I am in danger of filibustering my estimates here, but I think this is an important

issue and one that I do speak about quite a bit. You know, hon. member for Peace River

North, of the difficulties your constituents are having in having to now take over and

operate airports. You know that presents a huge financial burden for places like Fort

Nelson.

Interjection.

Hon. D. Miller: Well, I'm speaking just of airports, because I want to try to

make a point which I think is important. Municipal governments now have to take over

airports. Most if not all of those are money-losing operations, and very little can be

done to actually revert those -- in other words, to make them profitable -- without

putting in airport improvement fees, which we're starting to see now around the province.

My guess is that you'll have one in Victoria before too long.

We know that the service . . . . If you want to fly to Calgary, you can

probably hop on a pretty cheap, no-frills flight, and that's great if you want to go to

Calgary. But if you want to go to Fort Nelson, Fort St. John, Dawson Creek, Smithers or

some of those smaller municipalities, things are changing. Where we used to rely on 737

jet service, we're now on either the Dash or the F28. Air B.C., because they have lost so

much money, have been pulling out of a lot of the regional services. They've been

transferring some to Central Mountain Air -- which is good for a northern British

Columbia-based company -- but they too have been pulling out. Air B.C. announced last week

that they are abandoning their service to Prince Rupert, where I live.

Under the old regulated system that we had 15 years ago, they would have received

approval from the Canadian Transport Commission to service the route, and the fares would

have been regulated. It wasn't a simple matter, then, of simply saying: "We're

abandoning it. We're going to walk away from it." They had to go back to the CTC and

seek permission.

So have northerners benefited from deregulation in transportation? Perhaps. But is

there still some unfinished business -- some big prices to pay? Yes, definitely.

My view is that phone service is somewhat the same. The member is aware that it costs a

lot of money to put phone

[ Page 12500 ]

service into some of those small communities. They don't have the economic base to

afford that, so we're trying to help, through infrastructure grants and the like. But when

it comes to competition at the retail level -- at the local phone level -- is there

another burden that northerners are now going to have to face? Competition, at least in

the initial stages, is a pretty tough fight -- it's one in which it's really a question of

who blinks. Companies going into that kind of competitive environment go in knowing that

they're going to lose money, and it's a fight to grab the business.

I think there's lots of issues that . . . . Perhaps we even need to

consider a bipartisan approach to some of these policy questions. Certainly, for northern

B.C., I think that's a significant one.

B. Penner: Hon. Chair, my colleague from Matsqui is not able to be here today --

I believe he's under the weather. On his behalf, I'd like to make an introduction.

Leave granted.

B. Penner: There are students visiting today from Pacific Christian School in

Abbotsford. Their teacher, Sonia Penner, is here along with six students and six adults. I

understand that so far today, they've enjoyed a visit to Victoria and they've seen some of

the other sights, and I hope that they'll be impressed with what they see taking place

here in the Legislature. Would everyone here please make them welcome.

[1450]

R. Neufeld: I don't disagree with some of the issues that the minister talked about

-- the high cost of phone service -- but it is important . . . . Then he went

on to talk at great length about the downloading of airports from the federal government,

and that is a tough issue for a number of communities across the province. But I would

suggest that the minister forgets very quickly that his colleague the Minister of

Transportation and Highways downloaded a huge amount of roads onto municipalities, which

they now have to maintain and upgrade.

In my case, in Fort St. John, they downloaded some of the worst roads through the

community and said: "You fix 'em." So I think it goes both ways -- just to

remind the minister that it happens at the provincial level. I'll only mention that one --

there's a number of others.

In any case, the explanation about where it would be spent leads me to my next

question. The minister said that it would basically be rural B.C. -- I guess that means

anywhere out of the Golden Triangle -- yet when one reads the spring report, it doesn't

lead one to believe that. It would lead one to believe that the full $10 million is

regional, that being in the north. Maybe what I'll do is just . . . . It's

also paraphrased in a letter here, and I'll just put it into the record. "Through

initiatives like the provincial learning network, northern British Columbians will be able

to use modern communications technology. The budget includes $10 million to launch this

regional development strategy."

I guess if we're talking regional -- if everything out of Vancouver is regional, then

I'm not exactly sure . . . . It comes out in a report to northerners and talks

about the $10 million. In fact, in the report it's exactly as this . . . .

Basically the $10 million, as I understand it, is provincewide for rural B.C. and not

particular to the north. The minister will get to me the information about where the

northern money will be spent and what amount out of that $10 million. Would that be

possible?

Hon. D. Miller: Yes. In addition to that, I will try to gather the information

in terms of the spending that'll also take place with not only PLNet but other initiatives

as well.

R. Neufeld: Thank you. I guess we've received -- at least I have -- two reports

now in the mail in the north -- "Report to Northerners" from the minister's

office . . . . Could the minister clarify for me: is that from the northern

commissioner's office budget? Or are these developed out of the minister's office and it

comes out of that budget?

Hon. D. Miller: They come out of my budget. I believe the cost all in -- you

notice we've gone to a newsprint format -- was, if I'm correct, around $10,000 to $11,000.

So we think it's important to try to just put out a report that allows people in the north

to feel kind of connected.

R. Neufeld: I'm just wondering where the budget comes from, because I don't have

a lot of problem with the report, other than mentioning some things a couple of times. But

I guess it will come . . . . We will see some things happen.

The other one was a letter that was sent out from the minister on March 31, 1999. It

said: "Dear Northern Resident." I had this sent to me from the minister's

constituency. To my knowledge, no one in my part of the north received this letter. Was

this just a letter written to the minister's constituency? It's dated March 31, 1999, and

it says: "Dear Northern Resident." It talks about a whole bunch of things and is

signed by the minister.

Hon. D. Miller: I sign so much. Perhaps the member could either read some

excerpts to refresh my memory or give me a copy.

R. Neufeld: I'll just send him over a copy, hon. Chair, and he can let me know a

little bit later.

I don't have any other questions about northern development. My colleague the member

for Peace River South has some questions about the northern commissioner.

J. Weisgerber: Yeah, I do have a few questions with respect to the Northern

Development Commission and the northern commissioner's functions. The minister will recall

that I was in support of the northern commission concept when the legislation was

introduced in this House.

[1455]

During the debate around the legislation establishing the commission, I observed that

one of the challenges for the commissioner and the success of the commission would be the

cooperation, or the ability to get cooperation, from the line ministers and line

ministries. I wonder if the minister can tell me or describe for me the relationship

between the northern development commissioner and the deputy ministers in the line

ministries in the province. Perhaps I'll give the minister a sense of where I want to go.

Does the commissioner meet with the deputy ministers on a regular basis? Does he meet as

part

[ Page 12501 ]

of a deputy ministers' economic council? What is the relationship between the northern

development commissioner and the senior bureaucracy in the relevant line ministries?

Hon. D. Miller: There's no formal organizational chart that I can share with the

member. But we were conscious, in setting up the commission, that there needed to be an

ability to work with the line agencies, and for that reason we've structured the reporting

in the act . . . . It's a report straight to myself. On a day-to-day basis or

a business basis, the commissioner is in constant contact not only with my deputy but

other senior people in the ministry, and if required, we assist the commissioner with

other ministries. It has not been brought to my attention by the commissioner that there

have been any significant issues around dealing with other ministries, so I've been

content that things must be working.

J. Weisgerber: Perhaps the minister can advise me of the level at which the

northern development commissioner has been established within the bureaucratic framework.

Is he an assistant deputy minister? Does he report to the deputy minister? Would he be

more senior than an assistant deputy minister? Where in the organizational chart does the

commissioner fit?

Hon. D. Miller: He would be at the deputy level.

J. Weisgerber: If indeed, then, the northern commissioner is the equivalent of a

deputy minister responsible for northern development, would it be reasonable to expect

that he would have open access to deputy ministers' meetings? Would the northern

development commissioner have to make some formal application to sit in with the deputies

on a given morning? Or could, in fact, the northern development commissioner simply show

up as a matter of course and take his place along with the other deputies in those regular

weekly or biweekly meetings that take place in this government -- and in all governments?

Not wanting to take anything away from the minister or previous ministers, we know that

a lot of the decisions are made at the deputy minister level. We know that a lot of the

obstacles can be overcome at that level, with cooperation from fellow deputies. So I'm

wondering: are there constraints on the deputy minister, if he happens to be in Victoria

on a Tuesday or Wednesday or Thursday morning, simply popping in and participating along

with the other deputies?

Hon. D. Miller: Well, I don't know about constraints in terms of actually

attending the meetings, but I want to respond and try to point out a couple of what I

think are important points.

When we made the decision to proceed with the commissioner, we were conscious of the

mandate, if I can use that term, that we received at the Premier's summit on northern

development, which was that they wanted something that could be identified as being

northern. They did not want a new bureaucracy. We listened to that, and we crafted the

commissioner through legislation with, if you like, a degree of autonomy -- a separate

piece of legislation. It was never our intention to set up a ministry of northern

development, and in fact, we haven't. I'm the Minister Responsible for Northern

Development, but I don't have, if you like, a bureaucracy or an agency that carries out

that function on my behalf. We do have staff assigned that liaise. So the commissioner has

got that degree of autonomy. It's a very small group; there are not a lot of employees.

Unless there's a particular problem, which I'm happy to jump on, then I think we've got

the structure set in an appropriate way.

[1500]

I hope the member realizes what I'm trying to say -- the kind of nuance here -- with

respect to a line agency versus a commission headed by a person at the deputy level.

Clearly, deputy ministers regularly consult me on issues that are important to the north.

I'm sure that if there were significant problems, I would have heard about them, either

from the deputies or from the commissioner himself.

J. Weisgerber: My concern is based on the experience we had with regionalization

and with the difficulties of the people charged with that regionalization process -- some

of whom worked for me as one of the ministers responsible -- being thwarted at the

bureaucratic level when there was an initiative that needed to be corrected. All I'm

trying to identify early on in the process is the mechanism by which this commissioner

might circumvent the kinds of obstacles that I know of from personal experience and that

others attempting to do similar work have come up against. So that's the reason for my

questions along that line.

Hon. D. Miller: I appreciate the member's questions. I think I understand why

he's asking. I think we had a fairly extensive discussion during debate on the

legislation, and I talked about my own experience looking at previous attempts -- sincere

attempts; I'm not being political when I say that -- both by the Barrett administration

and, I think, by the Vander Zalm administration to have a mechanism whereby people in the

regions could be heard and the government was in a position to respond to their issues.

I don't think there's a perfect model, but we did go through a lot of discussion about

the model that we eventually chose. The Barrett model was flawed in that the minister

didn't have the authority; other line ministries did what they were going to do anyway. As

a result, I think that Mr. Nunweiler, the MLA from Prince George at that time -- who was a

very decent individual -- often felt frustrated in trying to deliver on what northerners

wanted him to do.

So we did in this instance try to clearly indicate that the focus of the commission was

economic, that the commissioner could not possibly become all things to all people or be

responsible for whatever happened in any ministry. I understand the member's question. I

think we've got a model in its chain of command, if you like, or organizational chart,

that ought to work. I think that the best way to overcome the kinds of difficulties that

arise is, when you see them coming, to sit down and try to work out reasonable solutions.

As I said, to date I've not been apprised of any significant issues involving the

commissioner dealing with other ministries.

J. Weisgerber: I'm not aware of any particular problems that the commissioner

has had in that respect. If I was, I would certainly bring them forward. I agree: I don't

think anybody wanted to see a new line ministry created as the ministry of northern

development, but rather they were looking at the commission model.

I think I heard the minister say that the commissioner couldn't be all things to all

people. I'm troubled from time to time when I hear people wanting to go to the northern

devel-

[ Page 12502 ]

opment commissioner to talk about health care issues and to talk about social issues or

educational issues or a host of other social concerns -- entirely legitimate but, I think,

outside of the mandate of the northern development commissioner.

[1505]

During the debates last year I expressed the opinion -- and at that time the minister

appeared to agree with me -- that the real challenge for the commissioner, aside from sort

of cutting through the internal difficulties within government, would be to, early on in

the commission's life, identify some hard successes, some projects that the commissioner

could with some pride point to and say: "Because of our commission and the work that

I and the other members of my staff have done, we now have this project in this community,

employing this number of people and generating wealth for the province" -- or

whatever it might be.

[J. Cashore in the chair.]

I'm not aware that any of those successes have yet been achieved. If there have been

any and I've missed them, I would certainly be happy to hear about them. If there are some

that are near but still not signed and there is information available about those, I'd be

interested in that as well.

But I am as convinced today -- perhaps more so, with the conflicting demands on the

commission and the commissioner's office -- of the need to focus on what I think

northerners in Prince George were talking about when this concept emerged. And that was

somebody who was able to go and talk to prospective investors -- whether they be British

Columbians or companies from Alberta or companies from Washington or heaven knows where --

to bring new investment dollars, domestic or otherwise, to work in northern British

Columbia. I wonder if the minister could give me a sense of how he sees that element of

the commission's mandate falling into place.

Hon. D. Miller: I did share with other members, last week in estimates, a list

of issues that the commissioner had been working on . . . . I agree that the

focus of the commissioner is important. I think there are stages to the work that the

commission has to undertake, and the first is -- and I think it's been done fairly well --

to become apprised of all of the issues that are important in northern British Columbia. I

think the assignment of staff to the discrete regions has been done. The commissioner has

been involved, sometimes peripherally, with other initiatives that have been announced

already -- for example, in a very peripheral way with the Louisiana-Pacific announcement.

I don't think the commissioner will always be able to stand publicly, sort of claim

credit and say: "If it hadn't been for the commission, this wouldn't have

happened." But I think the work of the commission on an ongoing basis will be

integral to achieving some success. I received letters -- I can't recall their details now

-- from individual companies who say that their issues have been resolved as a result of

Mr. Backhouse's involvement. I'm speaking generally here. What I would like to do is

perhaps have Mr. Backhouse directly develop that kind of information flow to you. There is

a requirement for a report in the legislation. I can't recall the details of that, but

there is a requirement for a reporting to this House, and again, that should provide more

information and more detail on the work of the commission.

I think I used the term last week that it's a bit of a game of inches. Economic

development work tends to be that way. I think there have been some successes on a small

scale. Some of the relationship-building, I think, is important -- the recent announcement

by the commissioner that they've signed a protocol with the North Central Municipal

Association and those kinds of things. The relationship with economic development

commissions, both formal and even those ad hoc . . . . I know I spent part of

a week ago Saturday -- around there, two or three weeks ago -- in Terrace at a meeting of

the economic development group that's been formed in the northwest. I think the

commissioner spent all day at that.

[1510]

But I'm being a bit random here in my comments. The work has gone on, and we'll try to

make more specific information available to the northern members.

J. Weisgerber: Let me finish by saying that what I would like to see more of

with the northern commissioner . . . . I've expressed this to him directly,

but I want to express it to you and put it on the record as well. I think we need to see

the commissioner spend more time as a high-level travelling salesman, if you like. I want

to see the commissioner out in Calgary and in Edmonton and in Washington State, sitting

down and talking to those investors that have the ability to come and bring business

opportunities. And I want to see him travel within British Columbia and sit down with

corporate leaders and union investment funds and whoever it might be. But I think that in

performing that kind of function -- and it's not an easy one -- the commissioner will very

quickly come head to head with the constraints that are there. Obviously, if there are no

constraints, the investment comes. But the job, as I see it, for that kind of an emissary

on behalf of the province is (1) to pitch the benefits of the province and (2) to come

face to face with the obstacles or the constraints that a particular investor, who will

have expressed an interest in British Columbia, has -- that there is a reason that the

alfalfa cube plant isn't coming from Falher to Dawson Creek.

I mention that because it's a project that I asked the commissioner to look at

particularly and to go and meet with the principals. When he becomes aware of the

specifics, then I believe that at his deputy minister level, he's uniquely positioned to

come back and say: "Look, this is a very real impediment to investment in our

province. I think we could resolve the issue, perhaps in conjunction with B.C. Rail or

perhaps in conjunction with Hydro or any of the other Crowns or with line ministry

functions."

I'm not being critical, but, very candidly, I want to see the commissioner spending

less time with the municipal people and with the economic development people. There's a

role for that work, but I'd like to see him out there, banging on doors at the very

highest level. This is a person who has the prestige of a significant commission from the

province of British Columbia, who I believe could market our province at a level that

perhaps only a minister of the Crown might do and perhaps, in some cases, do more

effectively than a minister of the Crown could do.

Hon. D. Miller: I certainly appreciate the input. I think this member has

thought a lot about what we need to do to try to improve economic opportunity. If the

commissioner is not listening, I'll certainly pass that message on. I hope that the member

-- and all northern members, quite frankly -- continues to reinforce his views on what

will work, because, again, regardless of affiliation, I think everybody wants the same

thing.

[ Page 12503 ]

R. Neufeld: I guess, having gone through the discussion last week about the same

issues, I should put it on the record, to remind the minister, that the fall "Report

to Northerners" states very clearly that the northern commissioner will report

directly, and all his issues will be fast-tracked to cabinet -- it's called a

"pipeline to cabinet." So I'm hopeful that . . . . Actually, the

member for Peace River South brings forward some interesting problems and one that he's

experienced, so he certainly speaks with authority on those issues. But the minister has

been out there saying that this is a direct pipeline to cabinet, and I hope that this is

exactly what it is and that something happens.

[1515]

One quick comment. The minister talked about L-P and that the commissioner had an

involvement with the L-P deal in the Peace country. Did I misunderstand, or is that

correct? If he did, at what level? And what involvement would he have?

Hon. D. Miller: I think I used the term "very peripheral" with respect

to that.

R. Neufeld: One last question. The natural resource community fund -- which, of

course, is not in your ministry . . . . But the Ministry of Energy and Mines

funds two million dollars' worth of that funding every year -- $1.965 million, a portion

of petroleum and natural gas revenue. It's a $25 million fund. I see the money that's put

into that fund. It starts out with $25 million. I believe that's the way it started when

the fund was actually initiated to look after the Cassiar issue. The portion of the

mineral revenues is $145,000. The portion of the forest revenue is $5.365 million.

Interest of $1 million makes a total of $8.475 million, which is a direct transfer to the

general revenue fund.

Has that fund -- other than for Cassiar -- been used to help any community in the

north, which you're aware of, that relates to the northern part of the province that you

now are responsible for? Has one dollar of that fund ever been used in any community other

than Cassiar?

Hon. D. Miller: I'm not certain. There may have been some expenditures around

Granisle. I thought there was around a study that was done by the district of Stewart, but

my assistant deputy minister tells me that's not the case.

Quite frankly, trying to explain that natural resource community fund has been, over

the years, a bit of a challenge. I have done this. I've explained it. I've been grilled on

it by the likes of Kevin Evans. It didn't come off too well in that interview, though I

thought I won the argument.

The fund was established . . . . I'm speaking, of course, at great risk,

since it's not my ministry. I've forgotten the year now. The notion was that where

economic circumstances had changed dramatically, there was a source of revenue so that

communities could look at things like doing studies on specific issues. Really, the fund

has not been used very much at all. In fact -- getting into a broader discussion -- there

is a fund, but I think the growth of other sources of revenue, particularly Forest

Renewal, filled a huge gap for those communities.

In other words, other . . . . We've always taken the position inside

government that if other sources of funding are available to do the kind of work you want

to do, then they are called on first. My own preference -- again, I don't mind taking the

odd risk -- is that we might be better off if we simply eliminated that natural resource

community fund -- not that we don't need to continue to work with communities. We do. I

think our ability to do that has increased dramatically since the time when we shut down

Cassiar. It was very traumatic to have to go into that small community and say that the

government wasn't going to advance any more money for mine expansion underground, because

our estimation was that the risk was off the map. And we did close the community.

[1520]

Other sources of funding are available for the kinds of studies that have been done in

some communities. Other support programs are available, and the natural resource community

funding, in some ways, has become -- you may want to take this out and beat me up on it --

a bit anachronistic.

R. Neufeld: Actually, I just wanted to know whether any other community -- and I

wasn't aware of one either -- received any funding from that fund. Really, to me . .

. . When you take in the minerals, it's over $2 million that your ministry

contributes, and it's all just a roundabout way to put it back into general revenue. It

does seem like kind of a crazy way to do things. But anyhow, that's the last question I

have on that.

We'll go into the Crown, BCR. We'll leave the rail division until last, and I'll just

start with BCR Ventures. We talked briefly about Willow Creek coal earlier during

estimates, so I don't need to get into it unless there is something that the minister

wants to tell us about Willow Creek coal -- other than that everything seems to be kind of

on hold until something changes with the market for coal. Are there any other things that

BCR Ventures is presently involved in, other than the Willow Creek coal?

Hon. D. Miller: No, that's the only project.

R. Neufeld: BCR Properties. There is some concern -- and I've spoken a bit to

Mr. McElligott about this issue -- from people who are in the private investment field and

properties and those kinds of things about competing against a Crown for business out

there. And I can appreciate that to a certain degree.

Some of the issues we're talking about -- Vancouver Wharves, for instance . . . .

Canadian Stevedoring is probably more an arm that can actually be attached to something

that BCR would be doing. Or development on their own property -- on their own tracks and

their own yards -- I can understand. But there is some concern specifically about one of

the latest ones, and that was in the Langley area -- the Deere-Hitachi development.

Basically I want to get the minister's comments on it. I know that it's been brought to

my attention by a number of people who are seriously concerned that BCR is moving into a

wider area of development of commercial property. Maybe the minister could briefly explain

it to me.

Hon. D. Miller: I've also been in receipt of correspondence from individuals as

a result of the Langley announcement. I'm not certain how to distil the argument,

necessarily. I mean, B.C. Rail is a commercial Crown, and I guess you could argue that

everything they do competes with the private

[ Page 12504 ]

sector, if you accept that premise. Really, the member is saying that there ought to be

a demarcation line somewhere. I just don't know where you'd put it.

[1525]

I think that the most important thing, from my point of view -- the one I'm obviously

most concerned about . . . . With the downturn, there's been a dramatic

reduction in the rail revenue, and of course it's in everybody's interest to have B.C.

Rail maintained as a commercial Crown corporation. They do have discrete divisions, and

they seem to be pretty good at what they do -- you guys could ask for a raise next. I

think that the central focus of maintaining the very important rail link is obviously

number one.

[P. Calendino in the chair.]

R. Neufeld: I appreciate the minister's answer, and I understand the process

that's being used, but I wanted to get on the record that there are some real concerns out

there about this type of thing.

The other issue I want to ask the minister about, as it relates to investment . .

. . This can be fairly short, I guess. I was reading in the Squamish newspaper that

B.C. Rail Properties has recently proposed an exciting 200-unit condominium project on

Squamish's waterfront. Was that a misprint? Is someone misquoting something, or is that in

fact true?

Hon. D. Miller: I'm not sure where the member read that, but let me try to put

it this way. B.C. Rail does not get into the housing development business. It may be that

some lands that are owned by B.C. Rail may be part of a package with the private sector,

who would do that. But it's not B.C. Rail's intent to get into the housing development

business.

R. Neufeld: It would be fair, then, to say that this could be a partnership --

that BCR Properties Ltd. is in negotiation with someone who is going to build a 200-unit

condominium complex. Would it be fair to say that?

Hon. D. Miller: I think it probably may be easier for me to simply reiterate

that it's not B.C. Rail's intention to actually get into the business of residential

development. It may be that it's property that B.C. Rail owns, and other private sector

property owners might in fact be involved in some discussions where developers might wish

to acquire land for the purpose cited. Apart from that, I would undertake to have whoever

the individual is in B.C. Rail who is most informed on this particular issue meet with the

member to more fully inform the member on what's happening there.

R. Neufeld: I thank the minister for that offer. Maybe one question that comes

out of that, and then I'll leave that alone. Have there been any sales of assets, of BCR

property, in the last year, either through a partnership with another firm or an actual

sale of land?

Hon. D. Miller: Just dealing with land -- yes, there have been.

R. Neufeld: Could the sale of land . . . ? I don't know if the

minister can tell me or not, or if he wishes to: is it a substantial amount of land? Is it

land that is actually part of BCR yards, or is it land in communities that they own that

is not part of BCR yards? And what kind of dollars are we talking about?

[1530]

Hon. D. Miller: It's land that's owned by B.C. Rail, though not part of the core

lands required for the rail business. The revenue obtained does fluctuate on an annual

basis. Again, I would endeavour to arrange a more comprehensive briefing on which specific

parcels and where, and those kinds of things, for the member.

R. Neufeld: Can he tell me what happens to that money if land is sold? If

there's a substantial amount of property that's sold that BCR owns, does that money stay

within the BCR Group of Companies, or is it . . . ? I guess what I'm asking

is: is it transferred to general revenue for government?

Hon. D. Miller: No, it stays within the B.C. Rail group.

R. Neufeld: So then BCAL does not handle any of the sales for the BCR Group of

Companies. If there is property sold, it's handled within the B.C. Rail Group of Companies

completely. Would that be fair to say?

Hon. D. Miller: Yes, BCR Properties takes care of those issues. Again, I go back

to your opening question. As an operating company with discrete divisions -- property,

ventures, etc. -- B.C. Rail is constantly looking for ways in which they can maintain

revenue -- in fact, I'd say, make significant reinvestments back into British Columbia,

whether it be the hundred-odd million for Vancouver Wharves or the kind of ventures that

they have entered into with the private sector. All of that goes back to try to create

more opportunity and more wealth and, clearly, to maintain the economic position of B.C.

Rail.

R. Neufeld: Talking about Vancouver Wharves . . . . That's the next

part of the BCR group. Are there any expansions planned with Vancouver Wharves in the

coming year? Maybe the minister can tell me if there were some expansions that took place

this past year.

Hon. D. Miller: No. If you like . . . . The global budget that was

announced some time ago for Vancouver Wharves -- about $100 million or $110 million -- was

for two main projects: the loop track and the agriproducts facilities. They do not have

any major expenditures contemplated.

R. Neufeld: Taxes in lieu. The UBCM brought forward a concern that actually the

taxes in lieu would be dropped dramatically this year. Is that in fact the case? If so,

can the minister tell me the magnitude of it, please?

Hon. D. Miller: The real issue is that we've not expanded them; we've kept them

at the same level.

R. Neufeld: I want to do a little bit around grain transportation in Dawson

Creek -- the CN and B.C. Rail part of it. I know we discussed it a little bit last week,

but the member for Peace River South indicated that he would like to ask some questions

around that specifically, because it is his constituency. I yield to the member for Peace

River South.

[ Page 12505 ]

[1535]

J. Weisgerber: For some time I've been interested in the issue of not only grain

transportation but agribusiness development in the Dawson Creek area. Given the layout of

Dawson Creek with respect to industrial land, the zoning and the prevailing winds, it's

logical that most industrial expansion -- whether agribusiness or otherwise -- would wind

up on the east side of Dawson Creek, east of the B.C. Rail interchange on the CN line.

I'm greatly concerned, and have been over the last months, with CN's plans to

short-line some of its northern lines. Given those concerns, along with various

announcements and bits of information around the future of the trestle at Pouce Coupe, I

know that I have in the past raised with the minister, during discussions around B.C.

Rail, the possibility of acquiring that

section of B.C. Rail which lies within the

province of British Columbia, particularly the track between the Pouce Coupe trestle and

the Dawson Creek interchange. I wonder if the minister can advise me whether there's been

any progress in that area and what the status of those negotiations with CN Rail might be.

Hon. D. Miller: Again, not to belabour the broader issue, because I think the

member understands the short-line issue and the potential for severing the rail link into

Dawson Creek . . . . Really, at a practical level, you have to do two things.

Number one is that CN has to be prepared to sell it. Number two . . . . The

member appreciates why we wouldn't go over the border, because you become federally

regulated. We're not about to do that. If CN really is not disposed to enter into

agreements or do those kinds of deals, then I don't know that there's much we can do.

I think it's very unfortunate, really. I had a vision, and that vision was to try to

capture Alberta Peace River grain, funnel it into Dawson Creek and from Dawson Creek down

B.C. Rail to the CN line at Prince George and then out to the modern grain terminal in

Prince Rupert. That was my vision. We were moving along nicely until the CN decision to

short-line. Unfortunately, while there's a very good, strong economic argument and studies

done by the Northern Alberta Development Council, all of which say that if we're going to

sell grain, the cheapest way to get it to the marketplace is the way I've just described .

. . . Notwithstanding the common sense in that, notwithstanding the broader issues

around the international marketplace for grain and the need to bring our costs down, we

can't pursue that unless CN is prepared to be a part of it -- or to play ball -- and they

don't appear to want to do that.

J. Weisgerber: The study done by the Northern Alberta Development Council, as I

recall it, was very strong in its argument that the best way to ship Alberta Peace River

grain out of about 90 percent of the Peace was to truck it to Dawson Creek and ship it by

B.C. Rail from Dawson Creek to the west coast, whether it be to Prince Rupert -- and I

share the minister's hope that it would be Prince Rupert -- or to Vancouver.

Here my knowledge is probably less complete than it should be, but the major

grain-handling elevators in Dawson Creek are on the CN line to the east of the

interchange. It's my understanding that that gives them primary control over rate-setting,

routing and all of the things that go with that. So I don't think it's a matter of

maintaining a rail link with Beaverlodge or Grande Prairie, as much as, within that

reasonably short track area, having control for B.C. Rail. That's what I would like to

see. I want to see us, perhaps through the northern development commissioner, be able to

go out and make this strong argument supported by the Northern Alberta Development

Council. Perhaps, before I get too far down that train of thought, I could ask the

minister to clarify that.

[1540]

Hon. D. Miller: I should also inform the member, by the way, that we do have an

agreement-in-principle with CN that we will take over all the switching, including in

their Dawson Creek yard.

I guess, really, one could surmise that if -- and the member referred to studies that

suggest that trucking would be an economical way to get Alberta grain to Dawson Creek .

. . . If that were to happen, then I'd suggest that it would be in CN's interests

-- and obviously B.C. Rail's interests -- to take the grain away from Dawson Creek by

rail. I think we're just going to have to see this play out. I would have hoped that we

could have maintained the rail infrastructure from Alberta into Dawson Creek. I don't like

to foreclose any option. So we'll have to see. If that were to become a trend, I would

imagine there might be some competition on the Alberta side, between truck and rail. But

clearly, if trucks prove to be superior in terms of cost, then perhaps we can still get

some wins for Dawson Creek and B.C. Rail -- and indeed for CN Rail, who would have to

carry the traffic from Prince George to Prince Rupert.

Either way it happens, I don't particularly care. What I'd like to do is increase the

utilization of our rail infrastructure and our port infrastructure in northern British

Columbia -- I would think for the benefit of both B.C. and Alberta grain farmers.

J. Weisgerber: Certainly I have no argument with that concept. I think the

reality of the geography of the existing rail lines doesn't really support that process.

The rail lines in Alberta, in the Peace, run primarily north and south, with the exception

of the line that runs from Grande Prairie through to Dawson Creek, which is kind of

southeast-northwest. Beyond that, it seems to me that it's in CN's interest to funnel

grain from the major grain-growing areas, which are the large inland terminals at Spirit

River and Fairview, and that CN has absolutely no interest in sharing that traffic with

B.C. Rail.

I realize this becomes a complex issue, and I wouldn't want to take the time that's

necessary to explore all of those possibilities. I do have an ongoing concern, though,

that CN may wind up abandoning that trestle at Pouce Coupe, which I understand is a

several-million-dollar wood trestle. I'm hoping that B.C. Rail will have started some

discussions with CN which would see, if there's going to be a severance of that line on an

ongoing basis, the track linked to B.C. Rail come under B.C. Rail control, as opposed to

some ten miles of tracks essentially wagging the dog with respect to the traffic that's

generated on the eastern parts of Dawson Creek and in the B.C. Peace -- in that region.

[1545]

Hon. D. Miller: The member is correct in terms of the Alberta line. There are

really two lines. If you perhaps try to

[ Page 12506 ]

visualize a tuning fork at the bottom, the lines actually do connect. There's a major

connection there called Watino Bridge that requires a significant amount of capital to

upgrade, and CN clearly is not going to do that. Similarly, if their interest is in

feeding Alberta grain into their system in Alberta, they don't see their commercial

interest necessarily as funnelling that grain into Dawson Creek. It's a bit unfortunate. I

mean, B.C. Rail can't substantiate making an investment where there's no return -- even

though I understand what the member is saying.

We're open with respect to wanting to work with CN. The conundrum is this. All railways

try to maximize their tonnage, particularly their long-haul tonnage. All of them do that.

They act in what is arguably their own best interest, trying to secure as much movement on

their rail lines as possible. There's nothing wrong with that as an objective, if you're

just running a rail line. Indeed, B.C. Rail has the same mandate. But where we were able

to craft an agreement in Prince George and Dawson Creek was that . . . . This

interchange agreement was really crafted because neither party had a downside. As a

result, we were able to put an agreement together that actually benefited shippers, who

could then make their own choices about where their product went -- whether it was south

or west or . . . .

I guess my message is this. While I understand the imperative of running a railway and

wanting to ensure that you get the revenue so that you can get a return to your

shareholders, I worry about national objectives -- in this case, I guess, the provincial .

. . . Well, not just the provincial objective; it's a national objective. Should

government -- and this is where I think the federal government ought to play a little more

of a role than they have played -- simply accept the fact that that's the way it is? Or

should government say: "Well, it doesn't make sense to us, because this system that

you've got in place -- surely, we understand it does benefit CN Rail -- disadvantages

shipping grain out of Canada"?

I mean, we seem to have thrown on the scrap heap all of those policy bases we used to

have in this country. We used to worry about our national port system; we used to worry

about the movement of a significant resource -- the grain resource -- to the coast and to

the market. I spoke earlier, and perhaps went on at too great a length, about some of the

costs we've paid for deregulation of the transportation system. I tried to provide a

warning as to some of the things that we're going to have to deal with in

telecommunications. I guess, really, the balance . . . . You've got public

policy over here, where we can actually look at things and say: "Well, this is the

way it ought to be to get the maximum efficiency." But the reality is that a lot of

that is market-driven, and companies will do what's in their own best interest.

We're going to continue to focus on northern B.C. I haven't given up, by any means. I

want to assure the member of that. If there are ways in which we can achieve that broad

objective, we're going to continue to work very hard to see if we can't do that.

J. Weisgerber: Well, it's an interesting debate, and I think it's probably one

that the minister and I have had before and one we probably don't disagree on. If indeed

railways are only going to maximize profits -- if that's the only objective for railways

-- then they might as well privatize them. There is absolutely no reason for a government

to manage a corporation if its only objective is for profit. It's better to privatize it.

[1550]

Having said that, I think the federal government did make a serious, fundamental

mistake in taking that approach with CN. Surely there have to be larger public policy

issues that government -- whether it be the provincial government with B.C. Rail or the

federal government with CN -- can look to railways for. The same, I believe, applies with

B.C. Rail. I think that the compelling argument against privatization of B.C. Rail has to

be its ability to deliver on public policy objectives, whether that be northern

development or maintaining service into specific communities or regions of the province.

That has to be the argument. I'm worried that the federal government has now taken this

privatization initiative with CN. CN operates only to its own advantage, not to the

advantage of regions of the province or industrial segments within the country. I think

we're a poorer country as a result of that exercise.

Perhaps it's the pendulum having swung too far. Perhaps for so many decades the

Canadian Wheat Board and all of the grain transportation infrastructure was too closely

involved with grain transportation. I think now it's too far divorced. There's nothing

that you or I can do about that except with respect to British Columbia, and it's only in

that interest that I have the specific interest in that particular bit of track that CN

has in northeastern British Columbia. I'm really just looking for an assurance that there

is some dialogue or some ongoing expression of interest in place so that if CN decides to

make a policy decision with respect to that track, we're there front and centre with our

interest clearly having been established.

Hon. D. Miller: I'll say this. We're always open for business, and we do

understand and appreciate the public mandate. In other words, B.C. Rail is a Crown

corporation. We're also cognizant that while that public mandate is a serious and

important one, fundamentally B.C. Rail also has to ensure that it remains a profitable

Crown corporation so that it doesn't become a burden on the general taxpayer. That balance

is being met, in my view, fairly well. The member and I . . . . It's amazing,

eh? A New Democrat over here, a former Socred-Reformer over there, and we get along quite

well on a lot of policy questions. We take your advice, hon. member.

J. Weisgerber: Not wanting to swell the heads of either the minister or the B.C.

Rail officials that are there with him, I too believe that B.C. Rail is doing a good job

of balancing those interests. I don't have an argument in that area. Again I raise this

thing. It's an issue that I have an ongoing interest in, and it's one that I simply want

to ensure that B.C. Rail, in its many other endeavours, doesn't lose sight of.

R. Neufeld: Last week it was brought to light in question period that there were

some huge expected losses in jobs in the forest industry in British Columbia, in fact,

projected by the Ministry of Forests themselves. I forget the number . . . .

It was in the thousands of jobs that were going to be lost. That's obviously . . . .

G. Farrell-Collins: Eighteen thousand in two years.

R. Neufeld: Eighteen thousand jobs in two years. That's obviously going to have

a huge impact on BCR's car loadings. It's a reverberating effect through the whole economy

of the province. I just wonder if the minister could brief me a bit on how the loadings

are at the present time. Are they expected to

[ Page 12507 ]

be . . . ? Were they consistent last year with the year previous? Are the

car loadings expected to be about the same in the coming year?

[1555]

Hon. D. Miller: There's no question that the reduced shipments not just of forest

products but other commodities as well have had an impact on B.C. Rail. I think that about

four sawmills along the line were closed; I can't name the particular ones. It's a bit of

a worry. I guess the question is: have we bottomed out? There is a sense that we have, but

there's nothing appreciable at this stage on the commodity shipment side that says we're

going like that.

My own sense is that there's been a bit of a bottoming out. I think that it obviously

takes some time to produce results. With L-P and, hopefully, Slocan as well, who are

currently going through a public hearing on their PA licence, I think it's fair to say

that, given the forest resource in the northeast, there will be an improvement over time

in the volume of products that are manufactured in the northeast and then shipped on B.C.

Rail.

R. Neufeld: I appreciate that there are some new plants that are planned but

still not producing. Would it be fair, then, to say that the 18,000 jobs that were

projected to be lost within the next year or two in the forest industry alone are not

located on the B.C. Rail line? Are they actual . . . ? There must be some

mills shutting down or something happening in the forest industry for that dramatic a loss

in jobs. Would that mean, then, that other places in British Columbia are being affected,

and not the B.C. Rail line? If that is in fact true, then I can maybe understand why the

minister's not too concerned about B.C. Rail losing a lot of carloads.

Hon. D. Miller: Well, no. I hope I didn't convey a false impression. It's not

that I'm not concerned about B.C. Rail; I am. As to the specifics, again, I'll try to -- I

hope the member will appreciate this . . . While it certainly was not my

ministry -- and I don't want to stray too far into speaking about work that's been

undertaken by other ministries -- I think the attempt was to try to create a snapshot of

the best sense at that time about some of the very real, tough issues facing the B.C.

forest sector and to move that forward to Ottawa to see if there was some appetite for

federal participation in assistance.

Really, I think all British Columbians ought to agree that that's reasonable. We've

seen in other regions of the country that have experienced some very severe difficulties

that there is a role for the federal government to play. Certainly Atlantic Canada -- on

an ongoing basis, really, but more particularly over the last decade, on the fisheries --

has been the recipient of a significant amount of federal assistance. We saw, with the

collapse last year of both the hog and the grain markets, the federal government put up

$400 million, I think it was -- it might even have been higher -- and make that available

to provinces. Now, I think the caveat on that particular program was that they wanted

provincial governments to match those expenditures.

So here we have the federal government playing a role in Atlantic Canada when

industries are in decline. We have the federal government playing a role in the prairie

provinces when the market, both in price and volume, for those commodities went south. And

we were simply trying to say, as a provincial government, that our forest sector here in

British Columbia was undergoing the same kinds of rather gut-wrenching and traumatic

economic upheavals and that we thought it was appropriate for the federal government to

play a role here as well.

[1600]

As to the forest sector itself . . . . Again, I'm taking some risks,

actually, talking about forest policy questions, but my own innate sense of the forest

sector in B.C. is that the area that needs to be recognized as really needing, I think,

more attention is the coastal industry. I think the interior industry is different. The

timber base is different; opportunities are different. Clearly, in terms of its size, it

is larger now than the coast industry. That wasn't the case 30 years ago. Its market is

different in this respect: much more of it goes straight into the U.S., where prices

remain pretty decent for lumber.

The coastal industry, on the other hand, repositioned itself a number of years ago -- I

think with the encouragement of previous governments, not just ours -- to be more

responsive to other market opportunities, as a strategy -- a good strategy. But I don't

think anybody would not recognize that the Asian downturn has had a severe and traumatic

impact on the coastal industry. It needs to look at itself in terms of: where is the

future in the coastal industry?

I don't think any of these are easy questions. It's interesting, when you do posit some

ideas, how quickly they generate all kinds of comment -- most of it negative. It leaves

you wondering sometimes just what it is that we ought to be doing. I've seen a lot of

those ideas put forward in the past, and every one of them -- or most of them -- got

creamed. So it's kind of an interesting challenge as to what it is that we ought to be

doing in the forest sector. I've expressed my views, and I've taken a few shots as a

result of it, but all of that was intended to try to offer up some new ideas. If the

approach we've taken over the last 20 years needs some fine-tuning, then maybe we ought to

have some courage and look at fine-tuning it.

R. Neufeld: I don't want to belabour this too much longer, but I know that when

I read the report, I immediately thought of what would happen to BCR's revenue and railcar

loadings. It's a serious issue that . . . . Whether or not we have the federal

government agreeing to put money into it, the issue is still with us. There must be a

strategy in place, I would hope, that would deal with those issues if they do become

reality. I can only assume that when the Ministry of Forests put out the report, they were

actually putting out the issues as they saw them for the next year or two. I'm hopeful

that B.C. Rail and the government have some strategy to deal with that.

I want to go on to another issue quickly -- the proposed Alaska-to-Washington rail

line. I don't have my notes in front of me, but I wonder: has there been any discussion

between B.C. Rail and the Alaska government as to any issues around this in the long term

-- actually bringing the rail down? I know that was a dream years ago, when rail was

planned to go through to Cassiar, into that rea of the province. I just wonder if there

have been any discussions around that with the Alaska government.

Hon. D. Miller: No, there have not been. Harking back to the previous set of

questions, I guess, if I could go back and search for an analogy, it's perhaps not unlike

the government of '86 to '91, in terms of their desire . . . . I remember the

then Minister of Forests, Mr. Parker. He and I had a few exchanges,

[ Page 12508 ]

but I do recall him saying that the federal government should pony up for FRDA 2 to the

tune of about a billion dollars. I guess that, historically, Ministers of Forests from

British Columbia have always tried to approach the federal government when they thought it

was reasonable to have some federal participation, and this government is following in

that honourable tradition.

[H. Giesbrecht in the chair.]

R. Neufeld: I'm sure that the member had many good discussions with the Minister

of Forests in those days.

I want to go on to the heritage train, just to get some clarification. Obviously there

are some issues around that; there are a number of issues.

[1605]

The member for Matsqui sent me some correspondence that he had with the minister and

with B.C. Rail on the policy of getting rid of assets -- asset disposal. I know that last

year, in fact, the member for Matsqui asked questions at about the same time -- May 21 --

about the policy of B.C. Rail on asset disposal. The minister at the time said that he

would get a copy of that policy and forward it to the member. I just want to ask the

minister again this year if he would care to forward that policy -- one year later -- to

the member for Matsqui, so that he can have a read of what the policy is.

Hon. D. Miller: I'm certainly sorry to hear that the member for Matsqui is under

the weather.

Interjection.

Hon. D. Miller: We're used to being under the weather a lot in Prince Rupert.

As I once remarked to the member for, I think, Oak Bay-Gordon Head, I'm not sure what

the policy is, but I'm sure they're following it. But the answer is yes, we'll try to get

that policy. If indeed it's available, we'll send it over.

R. Neufeld: Thank you. So I can assume that the member for Matsqui won't be

after me in the near future about not receiving the policy.

Two other issues around the society and the dinner train issue are the policy of

purchasing cars out of the U.S. instead of working with the society and, secondly, the

cancellation of the highly successful parlour class service. Maybe the minister would like

to comment on both of those, please.

Hon. D. Miller: We did canvass this issue last year. I actually have not even

looked at it since, and I've forgotten a lot of the details. Let me try to blanket the

issue by saying this: I did look into it very closely. There were allegations back and

forth; in fact, there may even be legal issues. Having looked at all of these issues, I

came away with the view that B.C. Rail had conducted themselves properly in an aboveboard

way consistent with the kind of good business principles that we would want in a Crown

corporation. I say that without hesitation, despite the fact that there may be ongoing

issues that individuals or societies have with B.C. Rail. I refuse to get further drawn

into that dispute, and I think that the benefit for British Columbians and for B.C. Rail

has been very good.

I think the dinner train is a good tourist attraction. It generates revenue for B.C.

Rail. I've not had the opportunity, despite the very kind invitations of Mr. McElligott,

to go on the train yet, except to look at it in the yard. But I would like to at some

point, because I hear it's just a delightful trip. Any issues that the National Railway

Historical Society or any individuals might have with respect to B.C. Rail . . . .

They should pursue them with B.C. Rail or through any other means that they have. But I'm

satisfied that B.C. Rail has acted very, very appropriately.

R. Neufeld: One last question about it: is this case actually in court? Is there

a court case pending against B.C. Rail from this society?

Hon. D. Miller: I can't answer specifically. There has been an exchange of

correspondence between the society and Mr. McElligott.

R. Neufeld: I want to ask a little bit about the debt of B.C. Rail. In 1992 --

when your government came to power, actually -- B.C. Rail's debt stood at $256 million,

rounding it off. Today it's at $591.5 million -- or it's expected to be by the year 2000.

That's over double the debt. In fact, it increases the debt of B.C. Rail by about $335.7

million. I can see by the net debt

summary that the increase in debt for the projected

year is another $17 million. I wonder if the minister could tell me whether he feels

confident -- and this is no . . . . I'm not trying to be critical of B.C.

Rail. I think B.C. Rail does an excellent job. The people who work for that corporation do

an excellent job, and it provides an excellent service.

[1610]

I want to get a sense from the minister whether he feels that that kind of debt load is

something that B.C. Rail can carry comfortably on their own into the future. Are you

anticipating further large increases to the debt? As I spoke about earlier, it's over

double under two terms of the NDP administration. I think it's sizeable. If the minister

could answer that question and also what the $17 million of new debt actually is for .

. . . I don't need it right down to the nuts and bolts, but there must be some

obvious expenditures for some fairly sizeable equipment.

Hon. D. Miller: It's a good question, and really, I will try to give an answer

that explains the . . . . You know, we've talked at various times both this

year and last year about the issues around B.C. Rail, the decline in the core business --

the rail business -- and B.C. Rail moving out into other discrete ventures to ensure that

there's a positive cash flow: significant investments like Vancouver Wharves, $110

million. All of those investments are commercially supportable. In other words, if they

had not been made, one would presume that the revenue base would start to deteriorate, so

I think you have to look at it in that light.

My general sense is that B.C. Rail is a well-managed Crown corporation. It's not just

because Mr. McElligott tells me that that I stand here and say that. Others in the

business sector who look at these kind of things generally give Rail some pretty decent

marks for their management of the enterprise. You have to look at that need. If Rail, many

years ago, said, "We are just going to run a railway and nothing else," perhaps

I'd be standing here today and we would not have a commercial Crown at all. Instead, we do

have one that has made some significant investments and is prepared to make

[ Page 12509 ]

further investments, if the return is something that adds to the bottom line and if

they're prudent investments and they're supported by the board.

I don't have any particular concerns about the fact that the debt level is what it is,

but I do have an ongoing concern, particularly in the north. I'm not really trying to be

alarmist at all. Certainly the prospect of, for example, the failure of northeast coal

causes me to get pretty nervous at times. That, unfortunately, is not within the purview

directly of the provincial government. If there were to be a cataclysmic event of that

nature, then clearly it would have consequences, but who can look into the future? In the

meantime, I think the company is looking at areas of investment that make sense, that fit

with the business plan and the overall scope of the business and that produce revenue to

retain the commercial viability of B.C. Rail.

R. Neufeld: That answers one part of the question. Could the minister maybe .

. . ? I'll just restate it. This coming year the debt is expected to increase by

about $17 million -- rounding the numbers. Can the minister tell me what substantial

investments are being made with that $17 million?

Hon. D. Miller: We will get a detailed note to the member on that question.

R. Neufeld: Thank you.

There has been a fair amount of speculation and discussion about the dividend payable

to the province by B.C. Rail. Could the minister tell me what the dividend was for last

year -- 1998 -- from B.C. Rail to the government and what the government is expecting from

B.C. Rail in this coming year?

[1615]

Hon. D. Miller: I think the budget documents say the dividend is $31 million for

'99, if I'm not mistaken. The corporation paid $40 million in 1998. When we look, overall,

at the dividend and assume, for example, that they ought to have paid a regular dividend

of about $10 million a year . . . . If we use that as the base -- I'm just

suggesting for discussion -- they would have paid more over the six-year period -- about

$96 million versus the $84 million. The dividend target for this year is $31 million.

Last year was not normal, in that WesTel was sold. There was clearly a capital value

realized on that, and so the dividend last year was higher than it normally would have

been.

R. Neufeld: Is there a rule of thumb around the government deciding how much of

a dividend it's going to request from the company? Obviously B.C. Rail doesn't say, out of

the goodness of their heart: "Well, this year we're going to give them $40

million" -- or, last year, $31 million. Is there some process that the government

actually goes through? I hope it's not just tied to the sale of assets. I heard the

minister say -- and we all know -- that WesTel was sold last year for, I think, $60

million or something in that neighbourhood. But if they sell X amount of property or

something, does the government get a certain percentage? How is that determined?

Hon. D. Miller: It's not too clear just how far back . . . . I see

that the member for Delta South is listening. What's that famous Joe Orton . . . ?

Prick Up Your Ears I think is the title. And indeed he was.

You might argue that historically $10 million a year was notionally a target, but for

several years there was no payment. So those are issues that there has been some

discussion on, and I can advise the member that there's ongoing discussion about how you

would not formulize but set up some kind of policy base with respect to B.C. Rail's

dividend. I don't know that you could nail it down absolutely hard and fast. For example,

if there were a decision by future governments to dispose of a significant asset of B.C.

Rail's, would they, looking at that, say: "Well, we think there ought to be a larger

dividend payment to the Crown"? I suspect that some Finance minister would look at it

and say: "Yeah, but . . . . "

So we're trying to deal with a more discrete policy framework around dividends. It's

not been finalized yet.

F. Gingell: Just to remind the minister: perhaps a lot of the province will

reinvest in the early years in redemption of a whole series of redeemable preferred

shares. I think the public accepted that that was sort of a permanent cap. I don't think

you should add it on again now as something that is distributable. B.C. Rail went out and

borrowed a whole bunch of money in the 1970s in the form of redeemable preferred shares

that were tradable. I'm sure people on the board will remember that. Profits were

reinvested to repay that debt -- done on a permanent basis, not just on a temporary loan.

[1620]

But anyway, perhaps the minister and the CEO will remember that we got into a

discussion in 1997 relative to the presentation of financial statements. Unfortunately,

circumstances didn't allow me to enter into the discussion in 1998. But I was critical at

the time, in '97. In my opinion, B.C. Rail did not meet the standards of a public company

in the disclosure of financial information dealing with geographic and departmental or

different business organizations. And the defence that was made in estimates, which we had

in the small room, was that B.C. Rail was a private company and not a public company, and

that to me is absolute nonsense. There is no more publicly owned company than a Crown

corporation. I mean, to suggest anything different is an insult to the taxpayers and the

citizens.

Now, as a result of that discussion, I wrote a letter to B.C. Rail and asked them to

have this matter referred to the audit committee, from which I've had no response. And

that's two years ago. I really do consider your defence that it is a private company to be

completely unacceptable. That's just . . . . You shouldn't think that way,

because this organization -- this wonderful organization -- belongs to the citizens of

British Columbia, not you, the management group, to privately run on your own. That's

nonsense. I would like a response, please. If you would like to respond now, that would be

good. But if this is an issue that was not expected, maybe the minister would allow us the

opportunity to discuss it later. Two years have gone by, and I do think that it's

something that . . . .

Hon. D. Miller: I do recall -- if not in absolute detail -- some of the

discussion we held at that time. I think I probably confessed then -- and confess now --

that when it comes to the intricacies of reporting and accounting, I'm not your man, if

you like. But the member did raise . . . . What I meant -- just so the hon.

House Leader opposite doesn't get too excited -- is that I'm not an accountant. I don't

know how . . . .

Interjections.

[ Page 12510 ]

Hon. D. Miller: I confess that I don't how to fly a plane either, and I probably

have one or two other deficiencies that I haven't noticed. I do like debating and

conveying ideas to the public, but anyway . . . .

I understand that that issue was put to both the external auditors and the audit

committee. I understand -- although I don't want to absolutely confirm anything here --

that they may have disagreed with your contention. We do have an annual report that is due

soon, and I would be delighted to provide an opportunity for the member and others who

might be interested to continue a level of discussion around these questions.

I do, though, sincerely believe that B.C. Rail . . . . I said a moment ago

that if B.C. Rail had simply clung to the notion that all it is is a railway and that's

it, then I suspect we would be having a very different discussion here today. They have

not done that. I think they've been very adroit in the business units that they've run and

created. As a result of that, we've been able to maintain the commercial viability. I

really think that is important.

There are some significant hurdles that we face in moving forward. But, having

confessed that I'm not an accountant and don't understand these issues that well, I'd be

happy just to confirm that we'll provide a forum where the member opposite could have

further discussion.

F. Gingell: I would like to suggest to the minister that B.C. Rail is somewhat

secretive. The people that they compete with and do business with and cooperate with --

CP, CN, Burlington Northern, whoever -- are all set to a different set of standards. It

isn't just B.C. Rail; it is the right of taxpayers and of members of this House to have an

opportunity to evaluate these wonderful investments. I was on the Fraser River Harbour

Commission for what seemed like forever, and I know a lot about Vancouver Wharves and the

issues that Vancouver Wharves have gone through. I understand these things. I don't think

that's private information. The harbour commission publishes their financial statements.

The National Harbours Board does, in a very broad way. They're dealing with the various

business operations and dealing with the geographic issues. I sincerely welcome your

offer, but I do think that we as legislators have a responsibility for the thing that we

speak about most, which is accountability. Without information, there is no

accountability.

[1625]

Hon. D. Miller: I take the member's counsel, Mr. Chairman. I was reminded of a

"Calvin and Hobbes" cartoon that I have posted, of all places, in the washroom

of my constituency office in Prince Rupert. It's a delightful cartoon in about ten panels

that has a discussion going on between Calvin and Hobbes, where one of them is lamenting

the fact that we know more about the private lives of "famous individuals" than

we do about most matters of public policy or public importance -- which I think is true,

actually. The solution they came up with was one that I don't know would work in practice,

which is . . . . I think it went something like: we ought to practise public

policy discussions in cheap motel rooms. That's a little joke, in case you didn't get it.

Interjections.

Hon. D. Miller: Maybe there's more to it than I've given credit to, but I keep

it there because it does remind me that in fact . . . . Certainly this member

is not to blame in the least, because he does raise issues of public policy, and

intelligently so. But I don't think that any member in this House would disagree with me

that all too often the very serious and important public policy questions that affect all

of our lives are given pretty short shrift. I would say that the most guilty parties in

the province happen to be members of this House, and I plead just as guilty as anybody

else in that regard. But I'll again confirm that the offer is there. I think there may be

some reshaping in the annual report that the member might approve of. You just let me know

when you want to get some people together, and I'd be happy to do that.

R. Neufeld: I can only assume from that last response that the minister is going

to start opening up the process a little bit more and letting all British Columbians know

what really takes place as a matter of public policy and what's going on in the province.

I want to ask a few questions around the value of BCR and group of companies. Is there

a book value of BCR and its group of companies that would include all of its assets,

including land and track and rail and wharves and you-name-it -- everything that the BCR

Group of Companies owns and operates?

Hon. D. Miller: Yes, the audited financial statements represent the values.

R. Neufeld: When will those audited financial statements for this last year be

available?

Hon. D. Miller: They're at the printers.

[1630]

R. Neufeld: With the B.C. Rail officials here, can you give me some sense of what

it says the value is? Is that easy enough to do?

[W. Hartley in the chair.]

Hon. D. Miller: I can, although I would prefer . . . . In terms of

some elaborate discussion, I mean, I'd prefer that the document be in the member's hands.

I'll just note, for example, that property and equipment are valued at about $1.6 billion.

R. Neufeld: That $1.6 billion, in round numbers -- I'm not wanting to get right

down to the . . . . Just ballpark, as my colleague says. That would be the

total of B.C. Rail and all its operating properties?

Hon. D. Miller: Yes. Obviously there are other entries on top of that -- cash,

receivables and those kinds of things. But yes, in terms of the asset base, it's about

$1.6 billion.

R. Neufeld: So with the $590 million debt, obviously there's about a million

dollars' worth of assets that are on the books. I just wonder, with the government's moves

in the last while, if there has ever been any discussion by the government with B.C. Rail

about privatization -- about the sale of those assets. Has there been discussion in the

last year or two years with anyone on the privatization of B.C. Rail and its companies?

[ Page 12511 ]

Hon. D. Miller: No, although I must inform the House that occasionally a little

message will fly into my office saying that there's some interest. But no, we have not had

any discussions whatsoever.

R. Neufeld: I want to explore that a little bit further, because I have heard a

few things that are a bit different than that, and maybe the minister can clarify those

for myself and British Columbians. I'm told that actually there are some serious

discussions going on at the present time about the disposal of B.C. Rail and the B.C.

Railway Group of Companies. One of the names that comes to light is the group of companies

that owns Burlington Northern. They have some serious interest in BCR, simply because it

would add to the infrastructure that they already have across the U.S., all the way over

to the east coast and which actually comes up into the Vancouver area. I'm told that they

have some interests in some of the coal deposits in northeastern British Columbia and that

they are looking seriously at wanting to purchase B.C. Rail.

But if the minister is telling me unequivocally that there is absolutely no discussion,

then I will take the minister at his word that there are no discussions with either the

CEO of B.C. Rail or the minister and that no one else in cabinet has had any discussions.

I've also been told that one of your cabinet colleagues has been discussing the fact that

B.C. Rail is on the verge of being privatized as we speak. That comes from some of your

colleagues on your side of the House. It may seem funny to you, but it makes British

Columbians wonder just what's going on. So I'd like to get that assurance again that none

of it, in fact, is true. Or, if there have been any discussions, please let me know.

Hon. D. Miller: I can say without hesitation, unequivocally, that the last time

there was a discussion around privatizing B.C. Rail, it came from the Leader of the

Opposition. I think he learned his lesson over it. There's been a dramatic retreat on the

other side from that policy. Neither I nor Mr. McElligott -- or any of the officials at

B.C. Rail -- have had any discussions whatsoever with anybody about privatizing the rail

business.

I don't know about Burlington Northern. I thought I knew what was going on in

northeastern B.C. around coal. I've had some discussions with other people besides Teck,

and I hadn't heard that before. I guess that in the future, if some government decides

they want to pursue that course of action, you might get an interesting bidding war going.

But no discussion whatsoever.

[1635]

R. Neufeld: I thank the minister for that. You never know whether what you hear is

true or not or, if you read it on the bathroom wall, whether you can relate it or not.

I have no further questions with regard to your estimates -- unless any of my

colleagues have any questions. I see everyone saying no.

With that, I want to thank the BCR people who are here today for their input, from the

official opposition and myself as critic. Having been a recipient of B.C. Rail services

for quite a number of years in northeastern B.C., I know that they are a well-run company,

and I have the utmost respect for that. I also want to thank your officials from the

northern commissioner's office, your Deputy Minister of Energy and Mines and yourself for

your forthright responses to our questions. I think it was valuable time that we spent,

for the most part.

With that, I don't think I have any further questions.

Hon. D. Miller: I would also like to thank the various officials who supported

me throughout the estimates, but particularly note that I think the tone of the discussion

we've held in these estimates has been very good. The last time I had that cooperative a

discussion, actually, was when I was Forests critic and Mr. Richmond was the Forests

minister, which shows that perhaps it is long overdue. I really would like to thank my

hon. friend the critic for the tone of those discussions. I only got mad once, and that's

when some stray wandered in and tried to make a point that was inappropriate.

Mr. Chairman, perhaps I could call the vote, then move the next one.

Vote 25 approved.

Hon. D. Miller: Mr. Chairman, I'm not sure that "stray" is

parliamentary. So if I have offended anybody, I would like to withdraw before they get

offended. We'll take it up in another forum, actually.

Vote 26: resource revenue-sharing agreements, $1,200,000 -- approved.

Hon. D. Miller: I would call in this committee the estimates of the Ministry of

Women's Equality. Perhaps we could allow some time for the minister and her staff to come

into the House.

The Chair: Member for Peace River North?

R. Neufeld: Yeah, just some clarification. We understood that it was the

Ministry of Advanced Education, Training and Technology, unless it's just been changed. I

think it's Women's Equality in the small House -- but a bit of confusion. We'll get it

sorted out, because the critic is here, ready.

The Chair: Thank you, members. We have everyone here we need now, then.

[1640]

ESTIMATES: MINISTRY OF ADVANCED EDUCATION,

TRAINING AND TECHNOLOGY AND

MINISTRY OF INTERGOVERNMENTAL RELATIONS

On vote 11: ministry operations, $1,717,327,000.

Hon. A. Petter: I am very proud to be able to present the second annual

estimates of the Ministry of Advanced Education, Training and Technology. This has been a

relatively new ministry, created last year. In its first year the ministry has, I believe,

made some great strides towards the goal of improving advanced education and skills

training in our province, a vision that is designed to enhance our growing reputation as

Canada's education province.

These estimates bring together post-secondary education programs, skill development

programs, the Industry Training and Apprenticeship Commission, the Information, Science

and Technology Agency, the Crown corporations secretariat,

[ Page 12512 ]

the B.C. 2000 project and the office for disability issues, to name not all but most of

the operations covered by these estimates.

Before proceeding, I would like to start by acknowledging the efforts of the skilled

and dedicated staff and professionals who work in the ministry and whose effort has

enabled these programs to be as successful as I believe them to have been. Those staff are

not often enough recognized, but their effort is crucial. They are the reason why a

ministry such as this is able to deliver the programs as effectively as this ministry is

able to do. The House will no doubt have the ability to see some of the staff that come

through during the estimates process, and I would simply point out that behind each and

every one of the individuals who show up in the House, there are literally tens -- it's

not a large ministry; maybe hundreds, but not much more than that -- of others who are

dedicated and who are working with respect to these programs.

I just want to speak, very briefly, but a little bit philosophically, about what this

ministry is about and what we're trying to achieve, as a government, through this

ministry. The fact is that we are approaching a very critical time in our development as a

country, and I would argue that the issues that we confront are not different from those

that are confronting many other countries around the world. The fact is that we are

entering a phase in our development as a country -- along with other countries -- in which

the knowledge-based economy is becoming a reality and in which people's opportunity to

share in the benefits of the economy is becoming increasingly dependent upon their access

to knowledge, their access to skills and their access to training and post-secondary

education. That being the case, we run a real risk of becoming a society of haves and

have-nots, based upon access and lack of access to the skills and knowledge that are

necessary to participate in, partake of and share in the benefits of a knowledge-based

economy.

I would argue, as we move forward into this new economy, that if we are to maintain the

social progress that we've made in the twentieth century towards creating a thriving

middle-class, towards breaking down some of the barriers between rich and poor, and

towards providing a meaningful opportunity -- through a social safety net and other

initiatives -- for people to share in the benefits of society, the thing we must not lose

sight of as we move forward in a major new economic environment -- one in which people are

increasingly being pressured by their access to knowledge; in which people are

increasingly being dislocated from traditional workplaces and work environments into new

workplaces and work environments which are more competitive; and in which they are pushed

more and more, based on their knowledge -- is that it's absolutely essential that we make

sure that we provide the support to each and every citizen who has it within their grasp

and their vision to be part of that knowledge-based economy, and that we provide to those

citizens every opportunity to do so and every kind of support.

[1645]

If we are to ensure that equality of opportunity means something in this society, if

we're to ensure that equality of opportunity can translate into some meaningful quality of

outcome, we have to make sure that people -- particularly young people, who are at their

most formative stage -- have the tools to gain the knowledge to be full participants and

to share in the benefits of this society.

What I fear is that if we don't do that, if we don't put our efforts strongly in that

direction, we will end up in a society in which there is a highly educated and technically

literate elite that will set itself above the rest of society -- an elite that will be

able to, by virtue of its access to private education, private health care and private

police, retreat increasingly into an environment in which it is set apart from society as

a whole. That would be a huge step backwards, essentially back towards the kind of

breakdown that existed in the nineteenth century between haves and have-nots, which the

twentieth century and the emergence of the welfare state, labour laws and the like helped

to overcome.

If we're to avoid that step backwards, we've got to now put our efforts into education

-- to making sure that everyone has access to education. Basic education today -- unlike

when I went to school and certainly unlike the case in the mid-part of the twentieth

century -- is no longer simply a secondary or primary education. A high school education

is no longer basic; post-secondary education is now basic.

As we developed, in the twentieth century, a commitment to universal access to basic

education -- meaning primary and secondary education -- we must now . . . . If

we are to keep faith with that commitment and extend it to the challenges of the

twenty-first century, what we have to do is extend that universal access to basic

education to post-secondary education -- to the training and skills that can only come

with further training beyond high school. If we fail to do that, we will have essentially

taken a step backwards, rather than have met the challenge that faces us.

I wanted to put that larger context before the House and before the opposition, because

I think it does frame my thinking and that of the government around this issue. This

government has made an extraordinary commitment to post-secondary funding and to access to

post-secondary education. Lest people think that is an accident, I want members of this

House to know that it is no accident. It is part of a concerted effort to keep the doors

of education open wide, to ensure that the post-secondary education that is now basic is

as accessible as possible to every British Columbian who has the will and energy to put in

the effort to gain that education.

For that reason, we are one of the only governments in Canada that has consistently

increased funding for advanced education, providing budget increases every year since

1991. We've done that, as members of this House will know, in spite of the fact that the

federal government has taken millions and millions of dollars out of post-secondary

education. About $100 million less is transmitted to the province by the federal

government today than was the case, certainly, five years ago. Despite that withdrawal of

funding from the federal government, we have increased funding year after year after year

and reallocated it from other areas, because we do see this as an area of priority. We do

see this as a signature area of commitment to young people and to our future in this

province. We've allocated $250 million more to post-secondary education in the past seven

years -- an increase of 24 percent. We've done that, as I say, in spite of the fact that

federal funding was being withdrawn at the same time. So we not only had to make up the

increase, we had to make up the shortfall in terms of federal dollars.

We are continuing that pattern in this year's budget, for this year's estimates, by

investing an increase of $24.6 million for post-secondary education this fiscal year,

bringing the total budget for advanced education in B.C. to more than $1.3

[ Page 12513 ]

billion for this fiscal year. By doing that, we are going to be able to create 2,900

new, fully funded student spaces around the province, bringing the total to nearly 16,000

new spaces since 1996 and keeping us on track to meet our goal of 20,000 new spaces to be

created by the year 2001.

I'm very happy to say that those spaces have been created throughout the province, and

they have been created without increasing tuition. As members know, this government --

again, in a way that is out of step with much of the thinking in Alberta and Ontario and

other provinces -- has kept tuition frozen for four years in a row, while other

jurisdictions have increased tuition substantially. That's further evidence of our

commitment to access -- to opening the doors wider. More spaces, frozen fees and more

support for students' assistance all mean that enrolment has increased by 10 percent since

1992 in this province. If members want to put that into some context, elsewhere in the

country enrolment has dropped by 4.4 percent throughout that same period.

[1650]

So we've been swimming in a different way from other governments. While other

governments have been following down the federal river of funding cuts for post-secondary

education, we've been swimming up the river -- up to higher standards, more access and

more resources. As a result, we've gone from the second-highest fees in the country to the

second-lowest, and we've gone from the second-lowest participation rates to the

second-highest. What I'm particularly proud of is the fact that those participation rates

have increased twice as fast in the rural areas of the province -- in areas outside the

lower mainland and outside of greater Victoria -- than they have in those urban centres.

That's a sign of our commitment to bringing education closer to communities and closer to

people -- through the University of Northern British Columbia, through an expansion of the

college system and through university colleges that have been created out of the college

system in recent years.

That's the kind of commitment that this government has made. It is a signature of this

government, and it does set us apart from other governments. I'm very proud of it, because

I do think it's very much tied to the question of what we are going to do as a society to

ensure that everyone has access to the tools to be full and active and meaningful

participants in an increasingly competitive economy -- one whose major criteria for

success will be based on access to knowledge.

We've also taken efforts in this year's budget and in last year's budget to increase

research at our universities. Last year we announced a $100 million knowledge development

fund to help public post-secondary institutions invest in research infrastructure, and

that funding is continuing throughout this year's budget. Announcements are to be made

shortly on some of the successful applicants for that funding.

That funding is matched by funding from Canada, by the Foundation for Innovation, as

well as from the private sector. Together with that matched funding, it will enable us to

invest some $250 million in the enhancement of research infrastructure in B.C. over the

next five years. That's a critical investment in our research capacity, because that will

translate into the jobs and opportunities of tomorrow. We've been very careful that the

B.C. component of that funding -- the criteria -- is tied to the creation of jobs and

opportunities that will benefit us here in B.C., not be exported out of the province. It

will in fact result in growing opportunities here at home.

What we've tried to do is improve our post-secondary system, keep tuition rates low but

provide additional resources to the system so the system can remain excellent in terms of

There is a tension there -- no question. Some provinces have decided, essentially, to give

we'll provide excellent programming for a diminishing number of students." We've

chosen not to do that. We've tried to ensure that our excellence is maintained for the

maximum number of students, and our participation rates continue to rise.

Now, I also need to reference some other activities that the ministry undertakes

through another of its divisions. The skills development division has been a major player

in terms of the success of B.C. Benefits, reducing the income assistance caseload and the

dependence on government assistance through its training activities. It's helping an ever

greater number of people succeed with the transition from welfare to work by providing job

sea