1977 Legislative Session: 2nd Session, 31st 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, FEBRUARY 7, 1977

Afternoon Sitting

[ Page

669 ]

CONTENTS

Routine proceedings

Oral questions

Oakland Industries closure. Mr. Barber — 669

Discussion of Pearse report by Forest Service staff, Mr. Gibson —

Cost overrun on BCR Fort Nelson extension. Mr. Wallace — 670

Quasar Petroleum obligations. Mr. Macdonald — 671

Government House guest list. Mrs. Dailly — 671

Committee of Supply: Ministry of Economic Development estimates.

On vote 79.

Hon. Mr. Phillips — 672

Mr. Lauk — 674

Assessment Amendment Act, 1977 (Bill 6) Second reading.

Hon. Mr. Wolfe — 677

Mr. Stupich — 678

Mr. Gibson — 679

Mr. Wallace — 681

Mr. Cocke — 683

Ms. Sanford — 684

Hon. Mr. Wolfe — 686

Committee stage.

section 1.

Mr. Gibson — 686

Mr. Wallace — 686

Hon. Mr. Wolfe — 686

section 2.

Mr. Gibson — 687

section 3.

Mr. Gibson — 687

Hon. Mr. Wolfe — 687

Division on

section 3 — 687

section 4.

Mr. Cocke — 688

Mr. Gibson — 688

Hon. Mr. Wolfe — 691

Division on

section 4 — 692

section 6.

Mr. Nicolson — 692

On the amendment to

section 6.

Mr. Nicolson — 692

Hon. Mr. Wolfe — 692

Mr. Stupich — 692

Ms. Sanford — 693

Report and third reading — 693

Committee of Supply: Ministry of Economic Development estimates.

On vote 79.

Mr. Levi — 693

Assessment Amendment Act, 1977 (Bill 6) Royal assent — 697

Tabling documents

Oyster River foreshore development social impact assessment report. Hon. Mr.

Nielsen — 697

Correspondence re M.E.L. Paving case. Hon. Mr. Gardom — 697

MONDAY, FEBRUARY 7, 1977

The House met at 2 p.m.

Prayers.

HON. W.R. BENNETT (Premier): Mr. Speaker, it's with sadness I

bring to the attention of this House the passing of a former member of

this assembly, John McRae "Rae" Eddie. Mr. Eddie was a strong trade

unionist and was first elected to this Legislature as a member for the

CCF party in June, 1952, defeating the then Premier of the province of

British Columbia.

Rae Eddie served with distinction for 17 years, retiring from active

politics prior to the election in August, 1969. I'd like to, on behalf

of the government, the people of the province and this assembly,

express our condolences to his family and friends at this time.

MR. D.G. COCKE (New Westminster): Mr. Speaker, it's been with

a great deal of pride that I've served as Rae Eddie's successor in New

Westminster from 1969 on. He was a person to whom no problem was too

small and no obligation too great to do all that he could to resolve

either the problem or the direction. So, Mr. Speaker, on behalf of the

official opposition, I also want to extend our sympathy to the family

of Rae Eddie. Certainly some of us will be attending his funeral.

MR. SPEAKER: Hon. members, perhaps, as Mr. Eddie was a

servant of the Legislature, a letter of sympathy could go forward from

the Speaker's office to the Eddie family on behalf of all of the

members of the Legislature.

MR. L.B. KAHL (Esquimalt): Mr. Speaker, in the gallery today

are many people from Oakland Industries. I would like to mention in

particular a few with whom I have had many discussions over the

weekend, and again at a meeting with the hon. Minister of Economic

Development (Hon. Mr. Phillips) at 1 o'clock today: Gladys Aske, who

works at Oakland Industries and represents those people inside; John

Irwin; and four fishermen — Willie Duncan, Larry White, Al Meadows and

John Anderson. Also in the gallery are Mr. Harry Steele and Mr.

Kirkwood, who are financiers for Oakland Industries. I would like the

House to bid all these people welcome, please.

HON. L.A. WILLIAMS (Minister of Labour): Mr. Speaker, last July I had

the pleasure, with the Minister of Education (Hon. Mr. McGeer), to establish

the commission on vocational, technical and trades training in this province.

The members of that commission included Dean Goard, Ms. Betsy McDonald, Arthur

Blakeney, Mr. E.H. McCaffery, Mr. Cy Stairs and Mr. Wyman Trineer. It is with

great pleasure that I inform the House today that Dean Goard, Ms. McDonald and

Mr. Blakeney are in the gallery. I ask the House to welcome them.

Hon. Mrs. McCarthy tabled the report of the Commission on Vocational, Technical and Trades Training in British Columbia.

Oral questions.

OAKLAND INDUSTRIES CLOSURE

MR. C. BARBER (Victoria): I, too, join with my colleague, the

member for Esquimalt (Mr. Kahl), in welcoming today to the galleries

those persons who, as the result of the closure of Oakland Industries,

are now out of a job, among them my sister's father-in-law, who's a

fisherman who trades out of there.

My first question is to the Minister of Economic Development. As the

minister is well aware — and I congratulate him for having agreed to

meet today, as he met earlier in January with representatives of

Oakland Industries — Oakland Industries has closed as a fish-processing

plant after some 18 consecutive years in operation in Victoria, which

has put out of direct employment today some 100 persons. An additional

180 persons — different persons — would have been hired for the herring

season. My first question is: what action has the minister taken? What

intervention has he personally been willing to make in regard to this

matter? Has he given instructions to BCDC, and does he have any

announcements to make at this time?

HON. D.M. PHILLIPS (Minister of Economic Development): Mr.

Speaker, I want to say at the outset that I share the concerns of the

members representing this area, both in and out of government.

About three weeks ago I had the first meeting in my office with the

principals of Oakland Industries. At that time it just so happened that

the president of the Development Corporation was in Victoria and they

outlined some of their problems and set up an ongoing dialogue to see

what the Development Corporation could do to assist the financially

troubled corporation. I had no further word from either the principals

of the company or the Development Corporation until I was informed last

evening about 9 o'clock of the action that had taken place on Friday

morning. I met this noon with the principals of the corporation, and I

had a meeting with representatives of the fishing industry and the

employers' union, and there were also representatives there from the

Federal Development Bank and the Bank of British Columbia.

[ Page 670 ]

As a result of that meeting, I am trying to call together in my

office tomorrow morning a meeting that will include representatives

from the Federal Development Bank, the Bank of British Columbia,

representatives from the Mitsubishi Corp., the British Columbia

Development Corporation, and principals from Oakland Industries. At

that meeting we will explore all possible avenues of action that can be

taken by those financial institutions concerned to see if there's any

possible way to get the corporation functioning again so that the

welfare of the families and those employed by this particular industry,

both directly and indirectly, can be saved.

MR. BARBER: A supplementary question to the Minister of

Finance, as fiscal agent through the superannuation commission and its

holding of shares in the Bank of British Columbia. I would first,

though, if I may, like to thank the Minister of Economic Development

for his answer. I appreciate his interest. We look forward to further

comments.

As the fiscal agent for those shares held by the people of British

Columbia in the Bank of British Columbia, could the minister advise the

House whether or not he has given instructions, advice, or made any

representation whatever, through those shares and the province's

ownership of them, to the board of directors of the Bank of British

Columbia, which is, as you know, one of the principals in the present

concern with Oakland Industries.

HON. E.M. WOLFE (Minister of Finance): Mr. Speaker, as the

member would know, the government represents the superannuation fund as

fiscal agent insofar as their ownership of shares in the company is

concerned. As such, we don't participate in the directorship or

management level of the company.

MR. BARBER: As a supplementary, my third and final question

on the same topic is to the Minister of Labour. Would the Minister of

Labour undertake today to give a commitment to this House that in the

event that Oakland Industries fails, through his personal, intervention

and cooperation with Canada Manpower the retraining programmes and

opportunities which will be required for the hundreds of our citizens

who will be thrown out of work will be made available immediately and

effectively to those people?

HON. MR. WILLIAMS: Mr. Speaker, there is an arrangement which

exists between the provincial government and the federal government for

providing specific assistance by agreement in cases where there are

failures of this nature. I can assure the House that if the Minister of

Economic Development and others are not successful in ensuring the

continuing operation of Oakland Industries, the full facilities of the

manpower division of the Department of Labour and Canada Manpower will

be made available to assist in the relocation and retraining of those

individuals who may unfortunately lose their jobs.

DISCUSSION OF PEARSE REPORT

BY FOREST SERVICE STAFF

MR. G.F. GIBSON (North Vancouver–Capilano): Mr. Speaker, I

have a question of the Minister of Forests. My question regards the

edict which the minister recently issued to members of the B.C. Forest

Service ordering them not to participate in any public discussion of

the Pearse report. Ruling out policy matters and any attempts to sway

public reaction to the Pearse report, does the minister not agree that

members of the Forest — Service could effectively act as resource

people and catalysts in these discussions?

HON. T.M. WATERLAND (Minister of Forests): The edict which

the member for North Vancouver–Capilano refers to, Mr. Speaker, is

probably a memo which I sent to Mr. Ralph Robbins, who at the time was

acting chief forester in the absence of the chief forester, as the

result of an invitation to several senior members in the Forest Service

to take

part in a panel discussion on the Pearse report. My memo stated

that I do not want senior people in the Forest Service to take

part in

such panel discussions. I am in no way preventing people in the Forest

Service from stating their personal thoughts on the Forest Service as

they wish. However, the senior people in the Forest Service are

involved on an ongoing basis with the forest policy advisory committee.

As such, relating to the discussions that are going on, I do not want

the public to interpret any remarks they may make in a panel discussion

as being forest policy. It's for this reason that I've asked them not

to take

part in that type of panel discussion.

MR. GIBSON: On a supplementary: Mr. Don Munro, who's a

forestry professor at UBC, referred to this, and I think properly, as

muzzling. I would ask the minister — who I remind you, Mr. Speaker, in

his capacity as a public servant spoke out publicly for months against

the mineral royalties legislation — if he doesn't think this is a bit

of "do as I say and not as I do."

COST OVERRUN ON BCR

FORT NELSON EXTENSION

MR. G.S. WALLACE (Oak Bay): Mr. Speaker, I'd like to ask the

minister of Economic Development, as director of the B.C. Railway,

about Regan Construction, which incurred an overrun of $1.4 million on

the

[ Page 671 ]

Fort Nelson extension. Can the minister tell the

House if he met, in August, 1976, in Dawson Creek, with the creditors

involved in this Regan Construction overrun?

HON. MR. PHILLIPS: Mr. Speaker, in answer to the member's question, it was a public meeting.

MR. WALLACE: Some information has been printed in the press

recently, Mr. Speaker, to the effect that Regan Construction creditors

have received settlement. Can the minister confirm when that settlement

was reached?

HON. MR. PHILLIPS: Mr. Speaker, in answer to the member's question, no, I'd have to get that exact date from the management of the railway.

MR. WALLACE: A supplementary, Mr. Speaker: I didn't mean that

the question had to give me the specific date. Perhaps I should

rephrase it as saying: has the settlement been reached, and is it

correct to state that preferred creditors have received 100 per cent of

their dollar and ordinary creditors have received 50 cents on the

dollar?

HON. MR. PHILLIPS: Mr. Speaker, again, I'll have to get that

information from the management of the railway. I presume that when my

estimates are up I'll have management here and maybe I can either

provide you the answer, or re-ask it again during my estimates when I

have management here and I'll be quite happy to get you the details.

MR. GIBSON: A further supplementary: could the minister say

whether, pursuant to his meeting with the creditors, he had any

individual meetings with the principals of Regan Construction or their

representatives, and did he indicate his view to the railroad as to

whether a settlement ought to be made, and in what way?

HON. MR. PHILLIPS: Well, there are really two questions

there, Mr. Speaker. The answer to the first question is no. The answer

to the second question is no, as well. The settlement was arranged, as

I understand it, through the lawyers for the creditors and the lawyers

for the railway, with the management t of the railway participating in

the overall situation.

QUASAR PETROLEUM OBLIGATIONS

MR. A.B. MACDONALD (Vancouver East): Mr. Speaker, I would

like to ask the Premier, in view of the fact that Quasar Petroleum had

committed its gas in an exclusive contract to Alberta and Southern,

when the Premier made the announcement on December 10, if he knew

whether or not Quasar Petroleum had secured a release from those

obligations. Does he know whether or not there has been a release from

those obligations up to the present time?

HON. MR. BENNETT: Mr. Speaker, the information I had was that

all gas was available for the pipeline. But I would be quite willing to

take your question as further notice, because it is a two-part

question, to give you very specific information that you may wish. But

the information that was given to me at that time was that all gas was

available for a B.C. line.

MR. MACDONALD: I have another supplementary for the Premier.

You know, I don't think it is available, Mr. Premier, but I'll ask you

another question: at the time you made your announcement on December

10, had the letter from the B.C. Petroleum Corporation to Westcoast

Transmission been sent to authorize the construction of the line, and

would the Premier table that letter?

HON. MR. BENNETT: Mr. Speaker, the question might more

properly be asked of the minister whose responsibility is the B.C.

Petroleum Corporation, but in answer to the member for Vancouver East —

first, second or third; whatever he is this week — I will be pleased to

take it as notice and discuss it with that minister and get the

information for the House.

MR. MACDONALD: A supplementary, Mr. Speaker; I'll ask the

Minister of Transport and Communications that question. Has the letter

gone out? That's the official letter that enables Westcoast

Transmission to build the Grizzly pipeline and include it in the costs

of its rate base. What was the date of the letter?

HON. J. DAVIS (Minister of Energy, Transport and Communications): Mr. Speaker, I don't know. I will make enquiries and get an answer for the hon. member.

GOVERNMENT HOUSE GUEST LIST

MRS. E.E. DAILLY (Burnaby North): Mr. Speaker, to the Hon. Provincial Secretary: could you ell us who prepared the

invitation list for the Government House tea on opening day?

HON. G.M. McCARTHY (Provincial Secretary): That would have been prepared by Government House, Mr. Speaker, in conjunction with my Deputy Provincial Secretary.

MRS. DAILLY: A supplementary. I would gather from that that

the Provincial Secretary and her department did have something to do

with the list.

[ Page 672 ]

My second supplementary then is: were those who were invited selected from a list of public servants?

HON. MRS. McCARTHY: In response to the hon. member for

Burnaby North, I believe public servants were invited — certainly

deputy ministers would always be on a list like that. Members of this

House would be on that list. I couldn't give you details, but I could

certainly make the list available if she'd like it.

MRS. DAILLY: Yes, I think we would appreciate the list.

Before we receive the list, I'd like to also ask, as a further

supplementary, if included in that list would be a list of former or

present Social Credit campaign workers. Also, could you tell us from

which of those lists — the public service list or the Social Credit

campaign workers — Mr. Klause Ohlemann was selected? He was at the tea?

HON. MRS. McCARTHY: Mr. Speaker, as far as specifics are

concerned I'll be very pleased to ask the Lieutenant-Governor as to

what areas are invited. I know that people who are in the public

service, such as deputy ministers, are usually invited. I would be

pleased to get as much information as I can. As far as people being

invited that are of one political stripe or another, I'm sure that all

political parties were well represented at the tea that afternoon.

Orders of the day.

The House in Committee of Supply; Mr. Schroeder in the chair.

ESTIMATES: MINISTRY

OF ECONOMIC DEVELOPMENT

On vote 79: minister's office, $141,324.

HON. MR. PHILLIPS: Before the vote is passed, I might take

this opportunity to just make a few brief comments on the very buoyant

economy that British Columbia is about to experience. The economy of

British Columbia, Mr. Chairman, may be described in terms of its five

principal characteristics. It has a narrow, export-oriented resource

base and substantial ongoing and rising capital requirements. It has a

population that consistently outstrips the population growth of the

rest of the nation, and this population growth remains heavily

concentrated in the lower mainland area of the province. The economy of

the province has comparatively high wage rates in all major sectors.

Finally, it is a fact of life that the narrow resource industries

are subject to major fluctuations in the world markets. These major

fluctuations bring with them fluctuations in family income and

disruptions to family and corporate welfare as well as a drain on the

tax revenues of the provincial treasury.

In cognizance of these facts and with the cooperation of other

ministries in this government, the Ministry of Economic Development has

formulated a general development strategy, the main aims of which

include: diversification of the industrial base; increased

opportunities for productive employment; stability in employment,

income and prices; balanced regional development; and real growth in

the gross provincial product.

This strategy recognizes that the traditional pump-priming methods

of job creation during economic downturns treat only the symptoms and

frequently aggravate the disease. The ministry also recognizes that

treatment of the disease itself requires more than short-term, one-shot

injections. Rather, it must involve long-term, ongoing, consistent

economic programmes aimed at industrial diversification and regional

balance, broader market penetration both domestically and abroad, and

substantially improved labour-management relations.

I recognize, Mr. Chairman, that the opposition has every right to

ask — and, indeed, they would be remiss if they did not ask — what the

ministry is doing to cure the economic ills of this province and to

help her regain her international stature in the economy of this

province.

First, you will note from my estimates that we are expanding the

highly successful trade mission and technical assistance activities. In

the current fiscal year of 1976-77, the people of British Columbia

invested $552,000 in these activities. Partial returns for this year's

activities indicate that new business orders from foreign markets, in

excess of $15 million, are adequate to sustain an estimated 500 jobs

here in British Columbia. Mr. Chairman, many firms had never considered

exporting their products before they were invited to join an economic

development trade mission. In the coming fiscal year, I have proposed a

budget of $601,000 to maintain these highly productive activities.

My ministry continues to be jointly engaged with the federal

Ministry of Industry, Trade and Commerce and the Council of Forest

Industries in a cooperative overseas market development programme. This

is the second year of a renewed five-year programme to develop new

markets for British Columbia lumber and plywood products. Mr. Chairman,

this activity has the potential to sustain more than 40,000 direct and

indirect jobs related to the forest industry.

Because British Columbia is so heavily export-oriented,

international tariff and non-tariff trade barriers have a very

important long-term impact on the B.C., economy. Existing Canadian

tariff protection has fostered the development and survival of the

Canadian manufacturing sector. However,

[ Page

673 ]

British Columbia's share of these benefits has been

disproportionately small. To improve our bargaining position with

Ottawa on matters of trade barriers I have instructed my deputy to

establish a study team whose responsibility it will be to provide the

government with an informed position of all issues concerning tariffs

and trade.

My ministry will undertake an active and aggressive role in all

matters relating to the General Agreement on Tariffs and Trade to

ensure that British Columbia's interests are fully reflected and

protected in all the negotiations and agreements entered into by Ottawa

on behalf of Canada. We intend, in this way, to keep Ottawa fully

apprised of the impact of proposed tariff and trade concessions on

British Columbia's economy, in order to minimize, if not prevent, the

foreign markets for British Columbia exports.

Fundamental to clear-sighted economic formulation is the development

of a comprehensive statistical and forecasting capability. To this end,

Mr. Chairman, I will be tabling a new Statistics Act in the Legislature

this year which, while filling the preceding requirements, will also

serve to streamline and co-ordinate the data-gathering activities of

this government.

Women's economic rights, Mr. Chairman, will continue to be an

integral element in this ministry's programme in the coming year. This

year the women's economic rights branch has been heavily engaged in

manpower studies in northeast coal development and in the conduct of

business workshops for women throughout the province. These activities

will continue in the coming year.

Finally, as you know the Ministry of Economic Development is very

active in matters related to coal. Throughout the current fiscal year

the ministry has been extensively and intensively engaged in planning

the orderly development of this province's vast and virtually untapped

coal resource. In late November last, I led a very successful mission

to Japan and received substantial market commitments for metallurgical

coal. Over the course of the past year the private sector has also made

a very substantial commitment to coal developments in British Columbia.

We are convinced that the market for British Columbia coal is indeed

a fact. The federal government has conducted independent coal market

studies and they are convinced that the markets are there. The private

companies which are putting up millions of dollars in private

investment are also convinced that the markets are there.

We believe that by 1985, the year predicted by some as the year of doom and

gloom for the Canadian economy, we can more than triple our production with

an additional five million tons coining from the southeast and approximately

an additional 10 million tons from the northeast

section of the province. These

markets will not be realized, thousands of jobs will not be created and millions

of dollars in fixed capital formation will not occur in the absence of aggressive,

dynamic, long-range policies designed to encourage development of this vast

coal resource.

It is not a question of giving away vital stocks of carbon fuel, Mr.

Chairman; it is a question of trading resource surpluses for our most

exaggerated needs in the long term for thousands of permanent jobs,

income stability, regional balance and sustained economic prosperity in

the province of British Columbia.

MR. GIBSON: Will you table the task force report?

HON. MR. PHILLIPS: It is also a question of aggressive

marketing in the international marketplace. Mr. Chairman, we must be

aggressive! From its very conception in pre-colonial days, the economy

of British Columbia has been rooted in export markets. Our domestic

markets are not large enough, and distances are too great and are not

related to the markets of eastern Canada. The world is our marketplace:

the United States of America, Japan and the European Common Market, to

name a few. Their people and their industries are also our competition.

Unfortunately, they are not ours alone, and that competition is getting

stiffer every day that goes by. To win new markets and to hold on to

our existing ones, we must develop an aggressive, imaginative,

forward-looking marketing attitude.

I must stress, Mr. Chairman, that we have done the planning. We know

the costs involved and we recognize the interplay of forces which must

occur if this province is to survive as a healthy economic unit.

MR. GIBSON: When will you let us know the costs involved?

HON. MR. PHILLIPS: You have heard my colleague, the Hon.

Minister of Finance (Hon. Mr. Wolfe), describe an economic recovery

during the budget speech on January 24. Real growth in gross provincial

product for 1977 is expected to exceed the 5.1 per cent achieved in

Housing starts were up 15 per cent in 1976, while the value of

manufactured shipments rose 19 per cent. Gains of 43 per cent in the

value of wood product shipments, 21 per cent in pulp and paper, and 50

per cent in fish products underscore our critical reliance on foreign

markets.

All of the news was not good, however, as the growth in the labour

force offset employment gains to sustain the unemployment rate above 8

per cent.

[ Page 674 ]

In 1977, I anticipate a real growth in the gross provincial product

approaching 6 per cent and a further moderation in inflation to about 7

per cent. While I also anticipate a healthy gain in employment of about

3.5 per cent, I would be remiss if I did not point out that growth in

the labour force is once again expected to offset any potential

reduction in the unemployment rate.

Mr. Chairman, the world recession of 1974-1975 brought about a

reappraisal of long-term economic prospects. There is now a widening

consensus that the high rates of growth in the past will not be easily

duplicated. Weaker growth in British Columbia's traditional export

markets means stiffer competition for available sales. While much of

that competition in the natural resource markets will come from

long-standing trade rivals, the resource-rich Third World is rapidly

emerging as a low-cost source of products and will also be our

competition. As a result, British Columbia producers will be under

increasing pressure to meet world prices and to reverse the erosion of

our international cost-competitiveness. B.C. exports are expected to

constitute 57 per cent of the value of output from the goods-producing

industries in this province.

Mr. Chairman, the message is crystal-clear. We simply cannot afford,

to squander our international markets. Management and labour in all

sections must collectively take the responsibility to ensure that

British Columbia regains her competitive position in the marketplace.

Our service sectors can no longer reasonably expect to set the trend

for wages and benefits in the primary sectors which constitute the

mainstream of this economy. If British Columbia is to forge ahead and

if British Columbia is to retain its reputation as a competitive,

reliable supplier and an attractive investment market, the time has

come to forgo the short-term illusory gains and to pursue the

longer-term, enduring rewards of rising real incomes, employment

stability for all, and stable self-sustaining economic growth.

Therefore, Mr. Chairman, I vote aye to this vote.

MR. G.V. LAUK (Vancouver Centre): Mr. Chairman, I would like to....

Interjection.

MR. LAUK: I beg your pardon? Mr. Chairman, did you hear the hon. Minister of Mines' (Hon. Mr. Chabot'

s) racist slur across the floor?

MR. CHAIRMAN: Sorry, I did not hear what the hon. member had to say. Please proceed.

MR. LAUK: I want to thank the deputy minister, Mr. Peel, for that excellent

opening address on the part of the minister. It's one I gave two years in

a row — word for word.

AN HON. MEMBER: Nobody paid any attention to it then either.

MR. LAUK: That's right! I can sympathize with the minister

and I share his frustration that gratuitous remarks — I suppose because

they're so obvious — go unnoticed in this chamber.

Before proceeding on to the minister's remarks and some other

aspects of his portfolio, I want to compliment the Minister of Finance

(Hon. Mr. Wolfe), who acquitted himself favourably on "Cross-Country

Check-Up." I was very impressed with the Minister of Finance. I was not

in agreement with many of the things he had to say, but he said them

without the usual cut-and-thrust that one finds in this chamber.

Perhaps we can at least take some comfort on this side of the House

that the minister has style, if not substance.

Mr. Chairman, the Minister of Economic Development is, as we've

stated before — and I only need to remind the committee — impaired in

office. He's impaired in his capacity to instil confidence in the

investment community.

AN HON. MEMBER: Withdraw!

MR. LAUK: No, I wouldn't suggest that the impairment lies in

any other area, Mr. Chairman. His impairment lies in the fact that he

fails because of the scandal-riddled portfolio and his role as the

minister. He has, therefore, failed to instil. confidence in the

investment community and, indeed, in all aspects of the economy of this

province. Both the working families and the business community in this

province are shattered by the recent events surrounding this minister.

I won't belabour those points. We have no fewer than four inquiries

into the activities of two ministers of this House, two of which

directly affect this minister and one of which is a judicial inquiry

that's to commence on the 21st of this month.

The hon. minister suggests that there is a tremendous growth

pressure on the labour force. This is not borne out. The population is

being stemmed in British Columbia, and there may be a net out-migration

next year. The point is this: although there is always a small increase

in the amount of the labour force, in 1975 and 1976 it's been less than

it's been in some many years. In spite of that fact, the nerve centre

of this government, the Department of Economic Development, has failed

to keep abreast of growing unemployment.

AN HON. MEMBER: You've got a lot of nerve!

MR. LAUK: He had a tremendous opportunity in

[ Page

675 ]

the past 14 months to bring about the kinds of

imaginative programmes that he talked about for three and a half years

on this side of the House. He called upon the nerve centre of this

government to produce. I can do no less, Mr. Chairman.

He had a tremendous opportunity during the period of the NDP

administration. There was tremendous — 3.5 to 4 per cent — growth in

the population with a fantastic growth in the labour force available in

this province. We kept abreast through most of that period of time. Now

that he has the opportunity, when there is a stern in the population

growth and a relief on the pressure of labour available, unemployment

has remained at all-time highs and will exceed — perhaps break —

records this month and the next. This is a drastic thing. So I cannot

conceal my disappoint ment, Mr. Chairman, when the minister stands up

and repeats a speech that I gave two years ago in this House which was

then announcing new programmes. All we've heard from this minister is a

canvassing of those programmes.

I am disappointed that the trade mission programme hasn't been

doubled. I'm very disappointed. We just started with the trade mission

programme when we were in office. You've had 14 months to develop a new

budget — $601,000 is disgraceful. What is the major thrust of the

Social Credit government in this province? What was it supposed to be?

Certainly it was economic development; certainly it was free enterprise

— instilling confidence in the business community, both foreign and

domestic, to bring in those capital requirements that we so desperately

need. And what do I see in the trade mission programme? I see $601,000

— an infinitesimal amount of money compared with that programme. We

piloted that programme and it was remarkably successful. It was about

the only thing that that hon. member, when he was a member of the

opposition, complimented my department on in those days. You would

think that he would have that clout — being the nerve centre of the

government — to get more money for that trade mission programme.

But let's go on to something even more critical to the economy, and

that is the overseas marketing programme for plywood and other lumber

products. It was of great frustration to me that there was a kind of

bush-league attitude, Mr. Chairman — and I'm sure the minister is

finding the same thing — on the part of our forest industry, and let's

be frank about this. If you want to be critical of the trade union

management in this province, that's one thing. But let's be perfectly

candid about the bush-league attitudes of the chief executive officers

and the boards of directors of the major forest firms in this province.

Since the war they've had a free ride. Since the war they've had an

almost sure market for their products. Now we see something even more

sinister.

The great MacMillan Bloedel corporation that we've always thought of

as being purely British Columbian, with some sort of patriotism

involved in all of that, that had built a fantastic wealth out of the

raw materials, the resources, of this province, has established — which

is their right — throughout the world alternative sources of production

which are taking up the traditional British Columbia market for our

lumber products in the United States.

MR. GIBSON: They started that when you were in government, Gary.

MR. LAUK: Those corporate decisions were made when we were

government, and we have to have a response, Mr. Member. We must have a

response. It is not enough to give an unimaginative, rehashing speech,

such as the minister gave today.

You must have an imaginative approach, Mr. Chairman, if we're going

to solve the problem of markets. The minister must go into the field.

He must talk to those chief executive officers on a regular basis. He

must encourage them and direct them if he can into becoming efficient,

more productive, and assist readily in their foreign-market

penetration. He must, on the other hand, constantly meet with the

Minister of Forests (Hon. Mr. Waterland), and develop a pattern of

utilization of our forest industry. We cannot let major multinational

corporations leave our forest reserve quiet for many years while

they're picking up the slack, at great profits to the multinational

corporation, through their Third World production and selling to our

traditional markets.

They do not have the citizenship commitment to this province that

all of us in this room should have. And this government — or our

government — should not acquiesce in this kind of multinational neglect

of the forest resource in this province. The COMPD is an avenue and the

beginning, but it's being underutilized and, I fear, at times not taken

seriously by both government and the industry.

In addition to that, there must be the pressure upon these

multinational corporations to sell our products abroad. It's not enough

to try and get contracts and to compete with people in these Third

World areas who are making 20 per cent of the wages that we make here.

I'm sure the minister would not in any way suggest that there be

drastic cuts in the standards of living for the majority of the people

in British Columbia, simply to compete with MacMillan Bloedel and their

Third World operations in our traditional markets in the United States.

If he's suggesting that — and I'm sure he isn't — that would be

tantamount to treason. And I'm sure he wouldn't suggest it, not for a

moment.

But what is he going to do about it? What is the Minister of

Economic Development together with the Minister of Forests going to do

about it? Surely you

[ Page 676 ]

can develop some programme, on the one hand taking

seriously the Pearse commission report and making sure that our forest

reserve is used to its maximum, and on the other taking a very active

public government presence in export sales of our forest products. This

ministry is not the nerve centre. It's the salesman for this entire

province. It's this ministry that has entirely — and should have

entirely — the interests of the public commonwealth in this province at

heart, not the interests of multinational corporations that have

production plants in foreign jurisdictions. It's our people and our

work force that we have to protect here and now.

I am somewhat concerned that the minister has announced yet another

study team into tariffs. I announced a study team, and we had a

full-fledged departmental team on gas, in negotiations in the Tokyo

round some time ago. We don't need a study team. We know what the

problems are. There is a transfer payment every year from the Province

of British Columbia to central Canada of somewhere in the neighbourhood

of between $500 million and $800 million, because of unfair, totally

discriminatory tariffs. This gives rise to the kind of unfortunate

western separatist talk that we're all so desperately trying to avoid.

This is the thrust that I was hoping to hear from the Premier when

he, from time to time, talked about the new role of this province in

Confederation. Deal with specifics, and not with generalities. There is

no need for a study team. It's been there and it's got the information.

We know we're being unjustly treated. We need a stronger voice in

Ottawa, not in Tokyo or Geneva. That's where the action is in

negotiating these tariffs. And it's about time that we stood up at this

critical period of time in Confederation and made our presence known.

Nothing of significance was said in that respect by the hon. minister

this afternoon.

He did mention the Statistics Act. I would ask him a question: is

this Statistics Act going to compulsorily force companies and

individuals to report to a department that leaks from the bottom, the

middle and the top? Is he going to expect people in private industry to

fill out questionnaires on a confidential basis to a minister who

hasn't the judgment to hire staff and responsible people who know what

"confidential" means? Methinks the Statistics Act should be tabled for

a year or two, or that the minister should step down and allow a

minister who has that kind of judgment to take his portfolio and

re-instil the kind of confidence that is needed, not only for the

Statistics Act, as I said earlier, but for the investment climate and

the commonwealth of the province of British Columbia.

I'm gratified that the women's economic rights branch has not totally

escaped the minister's attention. I do believe that the minister's women's

economic rights branch is being moonlighted, and it's a women's economic

rights branch in name only.

MS. R. BROWN (Vancouver-Burrard): Hear, hear!

MR. LAUK: We commenced studies into women's economic rights.

Those studies should be tabled starting this session; the information

should be available now. What is the minister doing? I'll tell you what

the minister is doing: he is slowly, by attrition, getting rid of the

women's economic rights branch. He does not take it seriously; he's

using it as window dressing.

MS. BROWN: Hear, hear!

MR. LAUK: I'm suggesting to the minister that there are a

great many people of all political stripes in this province — and not

necessarily all women — who are very interested in the successes of

that branch. Women throughout the entire province have been considered

in industry and in the economy as second-class citizens. They are very

capable, productive managers in the economy. It was our hope by

establishing that branch that it would be an avenue and a tool to have

them go through a few red lights in industry and economy and to

establish them in rightful positions of decision-making in management.

I think that's important, yet the minister was very cursory in his

remarks on that branch.

I find it even more disappointing that the minister did not

elaborate on further aspects of coal development, particularly in the

northeast, which, by the way, includes the minister's constituency. I

am told that the minister's trip to Japan did not succeed in

establishing further market commitments. I am indeed gratified to hear

that that was not the case.

I would certainly like to hear more from the minister about what

specific market commitments he did get when he visited Japan. I'm

instructed by certain individuals in the industry in Japan that no new

market commitments were made and that, as a matter of fact, there was

some suggestion that there were efforts to get out of some existing

commitments. Perhaps the minister can elaborate on the information I

received in that respect. I hope it's wrong; I really do.

He says that everybody's convinced markets are there, particularly

for our metallurgical coal. There is some convincing evidence that our

thermal coal has a market, particularly in eastern Canada and some

parts of the United States. Perhaps the minister would like to

elaborate on those markets. With respect to coal, if he's hoping that

10 million tons per annum can be delivered from the northeast sector, I

must ask him if he really expects that the present consortium

announcing its interest in that area can raise over $1.2 billion to

reach that deliverability of 10 million tons

[ Page 677 ]

per annum. The industry states $1.2 billion. Is

there any evidence — and he should have it; he's the minister, after

all — that that money is going to be available? If so, where will it be

available from?

Secondly, there will be at least another $700 million in

infrastructural costs to develop the coal resource in the northeast

sector. It could approach another $1 billion. Does the minister suggest

that for very few jobs, in relative terms, an already overtaxed budget

be further taxed to the extent of providing that $1 billion in

infrastructural costs — infrastructure being transportation, schools,

electrification, roads and so on — by shipping a natural resource out

of this province at a very low coal royalty of $1.50 a ton? Can the

minister comment on that? There is no evidence that the federal

government either has the inclination to provide those funds, or has

the funds; there is no indication of that whatsoever.

The minister announced a $2 million or $3 million contribution by

the federal government, which I negotiated with Mr. Jamieson some two

years ago. What has progressed since? We did that over a 20-minute

lunch. What's happened with that coal resource? What's happened with

the federal government participation? Can the minister comment on that?

Now the minister makes a few throwaway lines about competition, new

markets and holding on to existing markets. I ask him to refer again to

the very serious problem of multinational corporations that no longer

rely on their holdings of timber licences and other benefits in our

timber reserve here in British Columbia because of their Third World

and other North American production centres. He said the message is

crystal clear. Let me make a message crystal clear: if you're serious

about maintaining markets and getting new markets, you're going to have

to elaborate, because your statement so far, Mr. Minister, through you,

Mr. Chairman, is unconvincing.

Secondly, I would ask the minister to consider seriously the

problems of the image of his ministry in relation to the various

serious and important projects that I hope will get underway. He must

emphasize and concentrate on that problem. Does he not feel, as we do,

that his image is so impaired that he should step down as Minister of

Economic Development, either until such time as his image can be

repaired or entirely, for a new minister to take over the reins and

salvage the ministerial office?

A word about the Development Corporation — I'll just touch on it very briefly.

Interjection.

MR. LAUK: Yes, maybe we can deal with the BCDC later.

The House resumed; Mr. Speaker in the chair.

The committee, having reported progress, was granted leave to sit again.

HON. R.H. McCLELLAND (Minister of Health): Second reading of Bill 6, Assessment Amendment Act, Mr. Speaker.

ASSESSMENT AMENDMENT ACT, 1977

HON. MR. WOLFE: Bill 6 is the Assessment Amendment Act, 1977.

Most members will be aware of the fact that a number of serious

problems exist in the province's property-tax system at this time; many

will recall that the property-tax dilemma has been a source of concern

to this House for over a decade. These problems are not new, but the

delay in finding a satisfactory solution has resulted in the

development of many inequalities in assessment and has caused many

disparities in amounts that taxpayers holding property of similar value

have been taxed.

The present situation cannot be said to reflect the indifference of

the government to act but was caused by inflation and compounded by

efforts of former administrations to prevent property owners

experiencing unusually large increases in assessments from year to

year. In an attempt to prevent property owners receiving larger and

larger tax increases each year as a result of the compounding effects

of increased assessed values and increased costs of providing local

services, legislation was enacted preventing increases in assessments

from occurring. The legislation, while well-intended, has caused many

unforeseen problems and has created a larger number of inequalities

than the provisions were intended to cure.

The most recent attempt, Mr. Speaker, to find a solution to the

province's property assessment and taxation problem produced the McMath

report of the Commission of Inquiry on Property Assessment and Taxation

in British Columbia. This report was tabled in the House on January 25,

1977. The McMath report is a lengthy document containing many

recommendations related to a wide variety of complex matters and

property-tax law.

Because of the complexity of many of the issues raised in the report

and the sincere desire of the government not to precipitate any

additional assessment and taxation problems through adoption of hastily

considered recommendations, a decision was made not to introduce any

basic property-tax policy reform without first carefully considering

the issues and fully understanding the implications of planned

corrective action.

Since the report was received, it has been under examination by a special committee of cabinet. The

[ Page 678 ]

members of this committee are the Minister of

Finance as chairman; the Hon. Hugh Curtis, Minister of Municipal

Affairs and Housing; the Hon. Alex Fraser, Minister of Highways and

Public Works; the Hon. Robert McClelland, Minister of Health; the Hon.

Rafe Mair, Minister of Consumer and Corporate Affairs; and the Hon.

Bill Vander Zalm, Minister of Human Resources.

This committee has been requested to bring forth recommendations for

property assessment and taxation reform. Several meetings have been

held since the report was first received. While much work lies ahead,

the committee has been able to recommend that certain changes in the

Assessment Act be introduced at this session of the Legislature, which

will allow the province to commence on a programme which will produce

equalized property assessments without causing Serious dislocations for

property owners and taxing authorities alike.

While the government does not wish to delay the implementation of

much-needed property tax reforms, it was evident that within the

timeframe available no major changes could realistically be made for

entering into the 1977 assessment roll, and that the basic changes

should be delayed until 1978. It was therefore decided to continue with

the frozen assessment roll for 1977, but to introduce legislation early

in this session to eliminate a number of unsatisfactory and inequitable

situations which have developed as a result of the assessment roll

having been frozen for a number of years. Mr. Speaker, the additional

time gained by this course of action will provide the House with an

opportunity to fully consider an alternate method of attaining

equalized assessments for both school and municipal purposes.

So this bill, the Assessment Amendment Act, 1977, contains a small

number of changes required to immediately remove legal barriers

adversely affecting taxpayers and assessors alike. The provisions are

needed for purposes of the 1977 assessment rolls, which are already

before the courts of revision during the month of February.

The amendments will free the courts of revision and the assessment

appeal board to reduce assessments where appeals are received from

property owners. Under present legislation, it is considered that while

courts of revision and the Assessment Appeal Board are convinced that a

reduction in assessment is justified, they have no authority to change

an assessment appearing on the frozen 1974 assessment roll.

In addition, the amendments will allow assessors to enter in the

assessment roll property inadvertently omitted in the preparation of

the 1974 roll. It has been held that while the omission is evident, it

cannot be added to a value presently appearing on the 1974 assessment

roll. Only a small number of parcels having errors or omissions of

substance are expected to be affected.

The corrections will not be retroactive in application, but will be

made effective to the 1977 roll. The amendments also clarify that

assessors are empowered to correct errors in the assessment roll

through use of the supplementary assessments. No change in policy is

involved.

The amendments also provide for changes to the frozen assessment

roll where properties are incorporated within boundaries of

municipalities or are removed from municipal boundaries and placed in

rural areas. In such cases, different legislative provisions found in

the Municipal Act and Taxation Act apply. These changes provide

assessors with authority to correct statutory valuation and tax

exemption procedures applicable to the jurisdiction in which the parcel

is placed.

Mr. Speaker, because courts of revision are required by statute to

commence and complete their hearing of appeals against 1977 assessments

during the month of February, early enactment of these amendments is

essential if property owners are to receive fair treatment before the

courts. So I would urge that the cooperation of all members in

expediting the passage of these amendments would be much appreciated.

I might say, Mr. Speaker, that if, in fact, we do proceed to

committee on this bill today, I have asked Mr. Jack Moore, surveyor of

taxes, to join us in the House to assist us with any detailed questions

there may happen to be. I would urge all members to give consideration

to the need for early passage of these amendments which affect the 1977

situation.

Mr. Speaker, I move that the bill be now read a second time.

MR. D.D. STUPICH (Nanaimo): Mr. Speaker, the opposition can

certainly agree with the minister about many of the problems that he

discussed, the fact that problems do exist and the fact that the

dilemma goes back.... Perhaps rather than "10 years" it should be

"several decades" that there has been a delay in solution. This is the

third administration, I suppose, that has given some attention to this

concern, although it was left to the NDP administration to actually

start doing something about the many inequalities when it commissioned

the McMath report in the first place.

The minister says that the legislation before us, or the action or

inaction of the government, cannot in any way reflect indifference. It

does, certainly, reflect some delay at least, Mr. Speaker.

Although he is correct in saying that the report was tabled in the

House on January 25, 1977, to the best of our knowledge the information

available would indicate that he received the report in August, 1976 —

certainly in time to have brought some legislation into even a short

fall sitting of the

[ Page 679 ]

Legislature, when this kind of information and this

kind of procedure could have been relayed to the taxpayers of the

province much earlier and given them a much better opportunity to react

to assessment notices than they have with legislation that is first

being discussed on February 7, 1977.

The McMath commission was a very worthwhile commission. It was the

first attempt — the only attempt, really — to come to grips with a

situation, a very bad situation, in property tax. The McMath commission

made many recommendations, some of which were made public in the fall,

through some means or other — and maybe that is going to be inquired

into too, I don't know. But I think that one of the concerns we have on

this side of the House is that in spite of the fact that the government

didn't seem to be in any rush to deal with what in the minister's own

words is an anomalous situation and that many problems exist, in spite

of the fact that there was this concern on the part of the government,

concern on the part of the taxpayers, yet the McMath commission was

asked to cut short its work to bring in a hastily completed, or

incomplete, report.

The work that the minister now talks about having been done by a

committee of cabinet ministers, presumably work that was started in

August or September — I would hope that they didn't wait until January

to start meeting — could have been done by the very commission that had

the opportunity of travelling around the province, meeting people all

over the province, listening to representations. I think the minister

would agree that there were excellent people on that committee

inquiring into this. It would seem that given a bit more time, they

were the ones in the best position to have brought together their

report in a more meaningful way — a report that would have been much

more useful to government in bringing forth the kind of legislation

that the minister indicates will be coming down later in the session.

We have no wish to hold up the legislation that is before us, which

simply tinkers once again with a taxation system that has been tinkered

with for many years. The minister mentions it will be retroactive to

January, 1977. I am a bit curious as to why the bill says January 1,

1976, although I suppose there is some technical reason for that. I am

not really upset about that.

But I think the fact that the bill is coming down now when there

should have been legislation before us in a fall sitting is a criticism

of the government, if not condemnation, in this whole question of

property taxation. The very important recommendations in the McMath

report apparently are still being sweated over by a cabinet committee

rather than tabled early in the session so that the opposition could

have an opportunity to comment on these recommendations in legislation,

would have a chance to study them and make recommendations early in the

scheme of things.

It is my hope that the government does not intend to delay the

important bill, the one that will really be coming to grips with this

question of taxation, so long that there isn't adequate opportunity for

the people in this and other provinces who have some expertise and some

knowledge to supply information. It is my hope that the government will

not delay too long in bringing down the bill that we really should be

discussing at this point, or, Mr. Speaker, should really have been

discussing in a sitting last fall.

As I say, the official opposition does not intend to unduly hold up

passage of this legislation. We will support the bill before us.

MR. GIBSON: Mr. Speaker, like the hon. member for Nanaimo, I

have no intention of attempting to hold up passage of this bill, but I

certainly intend to draw attention to some of its very serious defects.

The minister says it's a minor bill, but I hope all of the

backbenchers opposite will take a moment to listen to the effect

increased taxes will have on thousands of farms and industrial

establishments around this province.

First of all, I want to reply to the comment of the minister. I

didn't take it down verbatim, but he said in essence that the

government has a sincere desire not to complicate property-taxation

procedures in this province by rushing into an unduly hasty reform and

complete overhaul of the system. He notes that it has been under study

by a cabinet committee for some months.

Well, Mr. Speaker, I certainly sympathize with him in this thought,

but somewhere there has been a defect in the democratic procedure. If

he is so concerned about a complete study before new legislation is

brought in for the long-overdue reform of the property-taxation system

in this province, why is it that the tabling of this report, or the

making public of this report, was held up by some six months after the

government received it? To me, that is absolutely scandalous, Mr.

Speaker.

We had tabled in this House the other day — I think it was January

20 — the preliminary report of the Commission of Inquiry on Property

Assessment and Taxation. I think it was as of August 14. Printed right

on the cover of that report, Mr. Speaker, is "July 30, 1976." Now let's

say the government received it a few days after that — even halfway

into August when the commission bylaw was disbanded. I think it was as

of August 14....

HON. MR. WOLFE: You were in Maui at the time. You wouldn't have read it.

MR. GIBSON: I was getting my mail, Mr. Minister, and was

possibly being more productive than you at the time. In any event, this

document was held back from the public for six months by this

government.

[ Page 680 ]

Why? I say that's not good enough. I say that's contempt for the

democratic process, because the people of this province paid for the

costs of that commission and they were entitled to the results of it

right away.

HON. MR. WOLFE: That's absolute rubbish!

MR. GIBSON: What do you mean it's absolute rubbish? When did you receive that report?

HON. MR. WOLFE: It was tabled in the House when it was required to be tabled.

MR. GIBSON: Why wasn't it given to the public right after you got it?

HON. MR. WOLFE: That's rubbish!

MR. GIBSON: That's not rubbish, Mr. Minister, and you know

it. You got that report some time in August and you sat on it for six

months for your own convenience. I say that is no good at all.

MRS. P.J. JORDAN (North Okanagan): Tell Ottawa!

MR. GIBSON: It's a disgrace — that's what it is.

MR. J.J. KEMPF (Omineca): Tell Pierre!

MR. GIBSON: I wonder why, Mr. Speaker. I wonder if there are

some things in that report that would have been an embarrassment to the

government if people had enough time to talk about them before we had

this minor little bill before the House. I'm thinking about things

like, for example, a recommendation that the province should move

toward provincial payment of 75 per cent of the school burden in this

province. Maybe that might have been a bit of an embarrassment to that

government if you could contrast that with the budget the day it came

out, eh? Maybe it would have been a bit of an embarrassment to the

Minister of Education (Hon. Mr. McGeer), who used to wave his arms when

he was on this side of the House and say exactly that should happen and

who hasn't been able to do anything now he's over there.

MR. C. BARBER (Victoria): How about property taxes?

MR. GIBSON: Maybe they're worried about the recommendation of a

special business tax on property. Maybe they're worried about the idea that

assessment should be equalized at full market value. Maybe they're a little

bit concerned about the finding in that report that the property tax we pay

in British Columbia is the highest per capita of anywhere in Canada. It doesn't

make the government look very good, Mr. Speaker.

Maybe they don't like the recommendation that provincial government

agencies should pay full taxes on the property they're occupying, like

the British Columbia Railway in my own constituency in North Vancouver–Capilano

where they're getting away with at least $150,000 in taxes not paid —

and they should be — because this legislation hasn't been reformed in a

timely manner. You don't need complicated legislation to bring that

kind of reform in, Mr. Speaker. That kind of reform is long overdue and

should be included in this bill. Maybe they don't like the suggestion

that where the provincial government levies taxes in unorganized areas

there should be an abatement of those taxes when the property owners in

those areas aren't getting reasonable services — and that's a pretty

good recommendation, too.

Why was this approach to the reform of the property taxation system

in British Columbia kept from the public for six months? This is

another reason, Mr. Speaker, why we need a freedom-of-information Act

in this province.

Now I think it's obvious we have to have a new Act this spring, and

it has to be done in time to allow the assessors to look after the

turning upside-down of their world, which will undoubtedly happen if we

go to full-value, equalized assessment around this province. But how

much better it could have been had there been time for public reaction!

Look at the contrast between the way that minister has proceeded and

the way the Minister of Forests (Hon. Mr. Waterland) has proceeded on

the Pearse report. He made it public within a couple of weeks of

receipt, no legislation for a year, and time for the public during that

year to absorb it and consider what best ought to be done. Instead,

this has been laboured over in cabinet-room secrecy and a bill is

dropped in our laps within a few weeks and we're told we have to pass

it right quick so the assessors can get on with their work.

Well, we have this bill in front of us which pretends to be

housekeeping legislation, and I ask you if it really is. I don't think

it is, Mr. Speaker. I think when you analyze the words, which at this

stage I'm not going to do in detail — I will in committee stage if we

proceed this afternoon — I think it gives a lot of backdoor powers with

very little control.

Section 2 opens up the rolls to amendment at any time by amending

section 11,

section 3, which amends the old

section 12 by adding 12

(3), opens up a complete back door — a complete barn door — for the

commissioner to reassess in any way he may choose.

Section 4, Mr.

Speaker, by the simple deletion of the words, "on the same basis," and

againI'm not going to get too far into detail right now, opens up hundreds and perhaps thousands of farm

[ Page 681 ]

properties in this province to reassessment on the

basis of reclassification when, in fact, they are still being retained

in farm use.

I will draw to the minister's attention the fact that there are many

properties, particularly in Richmond and Delta, which have been

assessed at a higher reclassified price because the value of the land

around had gone up. These were appealed and they were able to make that

appeal stick because of these four words that are being removed: "on

the same basis." That defence of these legitimate farm operators is

being removed. He has only to.study the actions of his own Assessment

Appeal Board to know that that's the case.

Then

section 4, which amends the main assessing

section in the Act,

opens things up for a complete reassessment of any industrial property

in this province which has had any improvement of consequence since

1974, by amending

section 24(6)(c), again removing those words, "on the

same basis," and also removing some other words, and again we'll get

the details later on. But I will cite to the minister a specific court

case — a court case filed in the Vancouver court registry on January 19

of this year — which makes it abundantly clear that that amendment

opens up all of the industrial properties of this province to

reassessment. You can bet that the zealous assessors of the Assessment

Authority are going to go after that because that's their job. I don't

blame them for that. I blame a minister whose draftsmen have either

snuck one by his nose or else there is the hope that this House will

overlook it.

Then I look at

section 6 which, in theory, permits all of this to

reach back to the last taxation year of 1976. The minister may stand

here and say: "No, it's just applicable in 1977." Well, in that case I

say to him change 1976 to 1977 in the Act, because I do not trust any

government to follow other than the straight letter of the law. I say

if they say it's going to be different than what's written here, let's

change what's written here.

Mr. Speaker, is this bill a little gnat or insect of some kind, as

the minister suggests? In that case, let's ignore it. On the other

hand, is it a monster of some kind? And the words exactly bother me in

that direction. Then let it be so labelled and examined. I ask the

minister: what is the dollar impact of this bill going to be in terms

of taxes raised and lowered, going back and forth? He suggested this is

a tax reduction bill. That's absolute nonsense. It's a tax increase

bill. He says there's no authority to reduce at the moment. Don't tell

me that when you look at 24(6)(b). When reductions have been made, for

example, in the city of Prince Rupert this year leading to a decrease

in taxes paid by Can-Cel of up to $750,000, don't tell me there's no

provision for reduction of taxes in the present act!

I don't know if that minister has read the present Act, Mr. Speaker,

let alone the amendments. I don't notice in this bill any help or

relief to the city of Prince Rupert. My God, Mr. Speaker, what's the

case to be? That city, has already been knocked on the head for several

hundred jobs by Can-Cel closing down for a year as a result of orders

from the Pollution Control Board to clean up its act there — which is

proper — but now they are to be hit on the head to the token of another

$750,000 because of the way our taxation statutes are drawn in this

province.

I say that's not good enough. I think it is right and proper that

when a property owner sees the value of his property, in effect, go

down, property taxes should go down too. So I do not say that Can-Cel

is improperly being allowed to get out of $750,000 worth of taxes. What

I say is that when there is a catastrophic impact on any taxing

authority or municipality around this province as a result of

government action — and that was the case here — then the government

should pick up that difference in between. The city of Prince Rupert

should not be left holding the bag on this one.

As perhaps others will do, I might pay tribute in this regard to the

hon. member for Prince Rupert (Mr. Lea), who's been raising this issue

consistently this session and, I believe, at this time of the debate,

for unavoidable reasons, is absent. He would make the case more

eloquently than could I.

Mr. Speaker, the minister says this is a minor bill. I say it is not

a minor bill and I will go into

chapter and verse in committee. But I

ask him to tell this House what the dollar impact of this bill is on

this province. Give us a dollar figure, and if it's a small dollar

figure that's very interesting. If it's a large dollar figure, we

should know more about this bill. I say to him: whatever that dollar

figure is, if it goes over that, is he prepared to submit his

resignation to this House? I don't think this bill is being properly

represented. I think it is an important bill that may be drafted in a

slick way, or it may be drafted poorly, depending on what motives one

might wish to ascribe. But it is not, by any stretch of the

imagination, Mr. Speaker, a minor bill.

I am a person with an open mind, I hope. I will listen carefully to

the words of the minister in closing debate on second reading, but

unless I hear something to convince me differently — and I have done a

fair amount of research into this bill — then, Mr. Speaker, I say we

are being asked to buy a pig in a poke, and unless the minister

successfully strips away that poke and reveals to us an innocent little

animal, then I shall vote against this bill which worries me very much.

MR. WALLACE: Mr. Speaker, I somewhat agree with the Liberal

leader. I'm always a little sceptical when we're told that this is just

a little housekeeping bill, and would we be good members of the

[ Page 682 ]

opposition in the House and cooperate in getting

the bill passed by a certain time. I know that in the past there have

been bills of this nature where we only really find out the true impact

of the bill after it's implemented. I'm also puzzled that the

government, I believe, asked the commission to wind up its activities,

before it was ready to do so, and come in with a report. I would like

the minister's comment on that when he winds up second reading, because

in talking with certain members of the commission, I understand they

were eager to pursue their studies further in the hope that they would

come up with a more effective and timely and comprehensive report. At

any rate, I gather the commission was asked to finalize its report

before it was ready to do so. Then, when the government received the

report, it was not made public for some considerable time. That kind of

aura surrounding the bill makes me just a little sceptical as to

whether the provisions in this bill are as simple as they're made out

to be.

On the same theme, Mr. Speaker, I would say that I hope that when

the minister introduces the more extensive review of the Assessment

Act, it is not something that's done one week and we're expected to be

able to debate it intelligently the next week. I would hope, since

there is said to be a fair slate of new legislation this session, that

something as far-reaching and important as a whole-scale review of the

Assessment Act will be presented to this House in such a way that the

opposition will have a very considerable amount of time in which to

study and research the government's recommendations.

As far as I'm concerned, I'm a little more trusting on this bill

perhaps than the Liberal leader, and I've looked at the explanations

given by the minister in his memo to the opposition. Nevertheless, I'm

a little concerned that it apparently extends authority to assessors to

enter into the assessment roll what are described as "omissions," or

where mistakes have been inadvertently made. I'm just a little

concerned on that point. Who determines what is an obvious mistake?

There's judgment involved here that, in relation to assessment, surely

has to be looked at very carefully. I regret that I missed the

minister's introductory remarks when he introduced second reading. He

may have touched on that point. The fact that this gives assessors and

courts of revision some new authority that they don't have at the

present time leaves me wondering if the minister could give greater

justification.

The other hesitation I have is that at the same time the minister is

on record as saying that, really, very few such adjustments will have

to be made. It's a little bit like the Act to abolish succession

duties. We've been given a reason, but the reason has not been

documented. I would say that in this whole area of assessment, if there

are many omissions or corrections needed to justify this bill when

we're going to have a much more extensive bill later on.... I wonder if

the minister could give us some idea what numbers of cases would be

involved in correcting these omissions or blatant mistakes, or the

cases where rural areas have since become incorporated within municipal

boundaries. These are three of the areas that the bill is reputed to

deal with.

I would also like to ask the minister to give a clear answer to the

question already raised by the Liberal leader in regard to

section 24.

I've had people in the industrial sector of our economy phone me.

They're deeply concerned that the impact of that

section is simply to

open up all industrial properties to reassessment. I understand one

particular company in British Columbia sent the minister a telegram

pointing out their anxiety in regard to 24(6)(c). I also understand

that the minister was not prepared to reconsider or amend his position

on that particular section. The minister, I understand, has stated that

this only relates to 1977 taxation. But some of the industries of this

province tell me that there's nothing in the Act in regard to 1978, and

that the door is wide open to whole-scale reassessment and change of

policy in relation to taxation on industrial property.

I, too, have followed the comments that have been made regarding the

situation in Prince Rupert. It seems very unfair in a community already

struck by economic problems that some provision in the Assessment Act

can, in fact, relieve an industry of providing such a substantial

amount of municipal revenue.

While I realize that this is not strictly relevant to this bill, the

whole question of assessment in the minds of British Columbians is such

a confusing one at any time. When the minister brings in what is

reputed to be a small bill and asks for hurried acceptance by the

opposition, I think that at the very least he must answer some of these

questions which have been raised by members such as the member for

Prince Rupert (Mr. Lea), the Liberal leader (Mr. Gibson) and other

people who have either sent telegrams or written to the minister.

I have another letter here from Mr. D.J. Thomas, who signs himself

as the former chairman of the 1976 court of revision. He makes the

point, for example, that some of the proposed amendments that we are

now debating can, in fact, give extended powers to the commissioner

which the minister has not acknowledged. Perhaps in committee stage we

can go into the sections which are involved. He expresses the point of

view that one of the amendments will, in fact, nullify the effect of

section 40, which is not mentioned in this bill at all.

The minister is obviously being coached at the moment. I just wonder

if I could be sure that this final question that I want to ask will be

answered when he winds up second reading, and that is to the effect

that

section 40 deals with the authentication of

[ Page 683 ]

an assessment roll by a court of revision.

According to Mr. Thomas, that really is a provision which is nullified

by the amendment to

section 12 (3). All these questions are being

raised by people who are very close to the assessment scene, people who

have filled this kind of function — chairmen of courts of revision. I

think that if they are asking those kinds of questions, which very

seriously pose the possibility that some of the sections of the bill

which are being left as is are, in fact, being nullified by the

amendments....

I wonder if the minister could tell us his answer to these two

queries in particular: the one from the industrial world regarding

reassessment of industrial property, and the points raised by Mr.

Thomas. I would like to have some of these answers before I can decide

whether to vote for or against the bill.

MR. D.G. COCKE (New Westminster): I share some real concern

over this bill, in that it was introduced some days ago. We had no fall

sitting when the bill could more rightly have been introduced.

Certainly the government, if they had been reading their mail, must

have known that they had a report, and that there are many things that

must be done to improve the assessment situation in B.C. We've been

sitting in the House now for three and a half weeks. Then we are told

that the courts of revision are meeting as of now, or as of tomorrow,

and on that basis they have to have something to go on. So therefore we

have to pass this bill very quickly.

There's no question that the bill will be passed. There's an

overwhelming majority of government members in this House who will see

to it that it is passed. Whether the member for North Vancouver–Capilano

(Mr. Gibson) is right, wrong or indifferent, this bill will pass this

Legislature in three days or less — likely today — because they are in

a bind with the courts of revision. But I am wondering why it wasn't

brought in and discussed at least earlier in this three and a half

weeks that we've been here,

HON. MR. WOLFE: Because we were on the budget debate.

MR. COCKE: Well, what's wrong with interrupting the budget debate?

HON. MR. WOLFE: Don't you agree with the budget debate?

MR. COCKE: As a matter of fact, the budget was such a mess,

Mr. Speaker.... If he wants some further discussion on that piece of

paper, we'd be glad to go on discussing that, and we will be discussing

aspects of that debate for successive weeks in this House.

There are problems, but I tell you that the minister can show us

some good faith right now by amending this bill when he stands up to

defend it in second reading. He can amend the bill to say that it has a

specific time limit to end during this year. And he'll do it, I'm sure.

I am sure he will, because that way he would be showing us good faith

and showing the member for North Vancouver–Capilano that this is not to

be for ever and a day. We're concerned, Mr. Minister, that you're

taking on powers that are totally unnecessary and that you are....

MR. D. BARRETT (Leader of the Opposition): Awesome powers!

MR. COCKE: Yes, that's right, Mr. Leader — awesome powers! We

hear all the pious statements from this government about seeing to it

that things are rationalized, seeing to it that we are a businesslike

province. Then we look at the things that happen factually.

We look at the assessment as it now refers to the school-tax

situation. This provincial government will be picking up a shameful 42

per cent of the taxes for school purposes or paying 42 per cent of

provincial school costs in this province.

Mr. Speaker, shamefully, because of this government, the local

taxpayer will be picking up 58 per cent. It's just not good enough.

What they say doesn't necessarily match what they do. So I suggest that

one of the reasons that they held up the McMath report was because it

would be embarrassing to bring down the McMath report last fall when

they know perfectly well there would have been a real demand for a

session at that point. So then they introduce the McMath report now and

say: "Okay, here it is. Now let's get quickly on with some minor

amendments." Minor amendments didn't sound too minor — when those

amendments cannot even help Prince Rupert. Now I recognize the Prince

Rupert case is before the Supreme Court of Canada. But you know, Mr.

Speaker, I don't think there has ever been a case of a Supreme Court

assessment appeal that's ever been overthrown by the Supreme Court of

Canada. So the laws are there and the laws are wrong under those

circumstances, as far as Prince Rupert is concerned.

I suggest to you, Mr. Speaker, that a government should think in

terms of what is fair. Is it fair for Prince Rupert to be bilked out of

$750,000 this year?

MR. LAUK: Is it because it's a Crown corporation?

MR. COCKE: It would seem to me that if it were not a Crown

corporation, maybe something different would have occurred. But, Mr.

Speaker, the city of Prince Rupert cannot stand to be bilked like they

have been. I suggest that the minister take Prince Rupert under his

wing at the present time. At least, if

[ Page 684 ]

they can't do anything else, give them a grant to

take care of that $750,000. Give them and any other community in

British Columbia that's seriously affected a grant. If they're afraid

that they can't change their rules now because it might have too

far-reaching effects, then give them a grant — an ex gratia payment of

some sort to look after Prince Rupert in their needs.

So, Mr. Speaker, I suggest to the minister, show us some good faith.

Amend the bill so that it won't last very long, and we'll have a

complete new Assessment Act before the Legislature where we can really

get our teeth into the whole question of assessment.

MS. K.E. SANFORD (Comox): When the minister was introducing

second reading of this bill, I think I heard him say that some

inequities existed in the current system. I think that has to be the

understatement of the year, because I think the minister recognizes

that assessments in this province are in a total mess. It does stem

from the various adjustments that have been made starting way back in

1967 or so. I fail to understand why, at that time, the initial move

was made to change the limitations and put a limitation on assessments.

Surely the Minister of Municipal Affairs at the time, as well as the

Minister of Finance at the time, must have known the kinds of

inequities that would result from that. However, that's past history

and I guess we shouldn't dwell on it.

There are very serious inequities that do exist. As a result of

those inequities, the previous government asked the standing committee

on municipal affairs to travel the province and to gain information

about assessments and the resulting taxation that should accompany

those assessments. That committee, Mr. Speaker, worked many, many

hours. I was fortunate enough to be part of that municipal affairs

committee at the time and we heard excellent briefs from regional

districts, municipalities and the general public on the whole question

of taxation and assessments. We also gleaned excellent information from

people as knowledgeable as Jack Moore, the surveyor of taxes, who is

here with us today, as well as other expert people in the field.

Mr. Speaker, when we had finished all of those public hearings and

had talked to people who were experts in the field of assessment and

taxation, we agonized as to what kind of recommendations we could make

to the then government with respect to changes in taxation that would

accompany the 100 per cent assessment. We worked for hours. We put

things through the computer. We got information from here, there and

everywhere, and we were unable to come up with recommendations because

the whole field is such a very complex one.

It was that committee, Mr. Speaker, that suggested that a commission

be set up in order to do the kind of detailed work that would be

necessary to come up with recommendations to the government. The McMath

commission then was set up. It is regrettable that they were asked to

report quickly, that their time was cut off and they felt that they did

not have sufficient time in order to do the in-depth work that they

wanted to do in this very complex field.

It is certainly inexcusable that the government should sit on that

report for six months. I fail to understand why that would be the case

unless, as suggested by a previous speaker on this, they were afraid

that if they released the report in August or whenever they received

it, there would have been a public outcry demanding a fall session in

order to deal with legislation on the McMath report.

Now the minister tells us we have a cabinet committee that is

looking at the report. Presumably that cabinet committee will come up

with recommendations for the legislation that we're going to see later

this session. I would like to know from the minister when the cabinet

committee was appointed, how long it has been sitting and how often it

has been meeting. I would also like to know why the Minister of Labour

(Hon. Mr. Williams), who took a very active role in the initial

all-party committee that was established under the previous government,

is not included on that committee. He seemed to take a great interest

at that time. I'm really sorry that cabinet ministers who were not

involved at all in the initial studies that were done on this by the

standing committee on municipal affairs are on the committee but others

who did travel with us, who heard all of the briefs, have somehow been

left off. I think the same applies to the Minister of Economic

Development (Hon. Mr. Phillips). As I recall, he was on our committee

at the time. I particularly remember the interest that was shown by the

Minister of Labour, and yet he has been omitted.

The other point that I would like to make, Mr. Speaker, before I

take my seat, is that while this bill doesn't allow assessment

increases, it will allow tax increases. If the assessment rolls as a

whole are reduced as a result of this bill, then, obviously, the taxes

will have to go up because the same amount of money has to be raised. I

wonder if the minister will comment on that as well.

HON. MR. WOLFE: A number of interesting questions have been

raised regarding this legislation, which is not surprising because

we're dealing here with a very complex matter affecting all of the

citizens of British Columbia. I would like to say that once again the

main thrust of what is proposed here is basically two things to clarify

the matter insofar as the present Act is concerned, so that errors or

omissions on the 1974 roll can be, in fact, corrected.

Now I understand that the numbers of these which might be involved — I'm talking about matters of

[ Page 685 ]

errors of fact where an item like a building or

some improvement is inadvertently not on the 1974 roll and therefore

there is no facility at present to correct it — could vary from 100 to

possibly 1,000 maximum. It's difficult to give you an exact answer to

that question. Any increased revenue, you might say, generated for

omissions or errors in the roll would be more than offset, in our

opinion, by the facility for appeal which has been ruled to be denied

under the present Act.

Last year in the appeal system, the courts of revision instituted a

number of reductions — a sizeable number — which were later ruled on

the appeal board as being inappropriate under the present wording of

the Act. So we are simply, in the second instance, trying to clarify

the wording of the Act so that future reductions of assessments put

through the courts of revision will in fact succeed. Those are the

primary two matters of thrust in this legislation.

Now to deal with just a few of the questions that were raised, the

member for Nanaimo (Mr. Stupich) was asking why the delay in the

legislation since we've had the report since late last summer.

Well, Mr. Member, it's one thing to prepare legislation but quite

another thing to be prepared for the implications of it. What we must

be very careful of is that we really should be interested in the

interest of the taxpayer in this instance, as compared to

municipalities and the other problems that exist. It's the taxpayer who

we must be careful doesn't bear the brunt of whatever we do.

I would like to say that we must be sure that the assessment rolls

are in the best quality and prepared for changes that we might envision

for after the year 1977. We could prepare legislation very quickly, but

we must know that the rolls and the implementation of it are prepared.

I think the member also referred to the fact that we are simply

tinkering with the legislation; another comment was the fact that it is

a minor bill. I don't think that I have ever referred in my remarks to

this as a minor bill or as housekeeping. This is not a minor bill. It

has very important implications on the taxpayer who wants to appeal. So

I don't think you could fairly say that we are tinkering with the

present legislation.

MR. STUPICH: Tinkering!

HON. MR. WOLFE: Mr. Member, I wouldn't call it tinkering when

we are providing access for people to appeal and reduce their

assessments. Do you disagree with that?

A reference was made to the fact that the legislation is

retroactive, Mr. Speaker, to January 1, 1976. This simply has to do

with the need to apply that date to the supplementary assessments made

in 1976. So the purpose of having the bill retroactive in application

was to ensure that the supplementary assessments made in 1976 could

properly be confirmed and authenticated by the 1977 court. Was that

your question?

Interjection.

HON. MR. WOLFE: Well, you inferred that you couldn't understand why it should be retroactive to 1976.

MR. GIBSON: Well, you said it didn't apply to 1977; now you say it applies to 1976.

HON. MR. WOLFE: Insofar as it affects the course of revision for 1977.

Now you also made reference to the Can-Cel situation. and the fact

that here we have a case where an assessment was, in fact, reduced

under the present Act. This happens to be one of the things under the

present Act that can be reduced. It is not so in the case of the

balance of your normal assessments. So it is not necessary to amend the

Act insofar as providing the power for that type of assessment to be

reduced.

A lot of comments were made about the report — that we caused them

to wind up early, that they couldn't complete their job. The facts are

these, Mr. Speaker: we gave them nearly three months' notice to

complete the report. We felt they had spent an adequate time doing

their research. The total time spent by the committee, which the

government appreciates, ran from April, 1975, to August, 1976. I think

anyone would agree that this is an adequate time to do a sound job of

research on this subject. They were given notice on May 26, 1976, and

they turned in their report in the middle of August.

There was concern expressed over the clause about omissions and

errors. How can anybody judge what is an omission or an error? As I

tried to explain earlier, it is a matter of fact whether an item has

been omitted from the 1974 roll, as opposed to an inaccuracy in

assessment. We are not referring here to the nature of an assessment

where the amount is being questioned or anything. It is just that an

item has been left off the roll through an omission or an error. So

this would clarify that, in fact, those can be replaced.

I referred earlier to the fact that in 1976 there were quite a

number of appeals in the courts of revision which were later ruled to

be inappropriate under the present wording of the Act, as far as the

ability to appeal is concerned.

A reference was made to

section 144(6)(

c) and the industrial plant.

I know that there has been concern expressed over the fact that this

would re-open this matter. The facts are, Mr. Speaker, that these types

of assessments for 1977 have already been received and they are not

changed. These industrial assessments

[ Page 686 ]

have already been sent out; they are the same as

they were last year. So although there may be concern in this

direction, they have not been changed for 1977. This is a simple fact.

As a matter of fact, it is people in industry who are the very people

who have been complaining that the Act is unclear. This proposal is, in

a way, intended to make this matter more clear.

Mr. Thomas was referred to for his concern over the authority to

amend and make changes in the rolls. I am aware that this has been the

main basis of his concern in the past. I think that he should probably

be well satisfied with the amendment in Bill 6 which clarifies that, in

fact, an assessor can make this change.

Reference was made to the Can-Cel case and Prince Rupert, and the

fact that the government should become involved in this, that we should

pass some amendment to the Act to somehow remedy the situation in

Prince Rupert. As a matter of fact, what has happened in Prince Rupert

is that through an order of the Pollution Control Board, a major part

of their sulphite plant was required to be changed it was ruled by the

Assessment Appeal Board that this was a recent development which should

have implications on the assessment for these people. There is nothing

in the Act.... What I think some of the members are proposing is that

we propose an amendment which would deny the taxpayer an appeal. There

is just no way that we can interfere in that procedure.

In a second instance, I did hear a comment that the government

should provide the funds to support a municipality where such a

reduction has been made. Through you, Mr. Speaker, would you advocate

that this money be provided for any ruling of the Pollution Control

Board, whether it was a private company or a Crown corporation?

Interjection.

HON. MR. WOLFE: That's a very important implication you're

giving: that any order of the Pollution Control Board then, and its

implications on a local municipality, should be absorbed by the

government. I'd ask you to reconsider that proposal.

Interjection.

HON. MR. WOLFE: You're asking us to make fish nor fowl between a Crown-owned corporation or any other corporation.

MR. LAUK: You're starving the municipalities.

HON. MR. WOLFE: I think the member for New Westminster (Mr.

Cocke) made reference to the fact that he didn't think that the supreme

court has reversed any decisions of the Assessment Appeal Board. My

information, Mr. Speaker, is the reverse, that the supreme court has

reversed many decisions of the Assessment Appeal Board.

So, Mr. Speaker, when one realizes the importance of this bill

insofar as 1977 appeals, and the fact that the main thrust of it is to

provide taxpayers an opportunity to reduce their assessments — that has

previously been denied as a technicality of the reading of the Act — I

think it's important that this bill do move forward. I appreciate the

comments made by members and the fact that they are concerned. With

that, Mr. Speaker, I would move that the bill now be read a second time.

Motion approved.

HON. MR. WOLFE: Mr. Speaker, I ask leave to refer Bill 6 to a Committee of the Whole House for consideration forthwith.

Leave granted.

Bill 6, Assessment Amendment Act, 1977, read a second time and

referred to Committee of the Whole House for consideration forthwith.

ASSESSMENT AMENDMENT ACT, 1977

The House in committee on Bill 6; Mr. Schroeder in the chair.

section 1.

MR. GIBSON: On

section 1, I wonder if the minister could explain this

section to the House, please.

Well, Mr. Chairman, the minister just sat there. The inference is

that he doesn't know how to explain this

section to the House. I'd like

to hear from him. He said this was a complex Act. I think this House

has a right to hear from him on every single word of this complex Act.

AN HON. MEMBER: Hear, hear!

MR. WALLACE: Mr. Chairman, I just wanted to make the same

comment on

section 1. Since the whole essence of assessment is

everybody wants to be sure that their assessment's correct, the

question arises: is the authority that's being vested here in the

decision to make changes, in relation to what the minister described as

omissions and errors of fact and...? We're still concerned that it

leaves a great deal of jurisdiction and judgment to the commissioner.

I take it the minister isn't concerned about that.

HON. MR. WOLFE: This

section is primarily to

[ Page

687 ]

move one

section of the Act to another, to put it in better sequence. It's already in the Act in another section.

Section 1 approved.

section 2.

MR. GIBSON: Mr. Chairman, I just want it noted for the record

that what this amendment does is remove any possibility of a challenge,

that a revised assessment roll wouldn't be as legally binding as one

that hadn't previously been raised.

Section 2 approved.

section 3.

MR. GIBSON: Mr. Chairman, this is the real barn door section.

section 3 here amends

section 12 of the existing Act.

section 12 of the

existing Act deals with supplementary rolls. Now it's relatively

unrestrained at the moment. But when you add the new subsection 3 that

will become

section 12(3), we have this new language:

"Notwithstanding sections 10, 11 and 40, and in addition to the supplementary assessments under subsections 1 and 2"

and I might say parenthetically that those are reasonably well regulated

"the commissioner may, at any time before

December 31 of the year following the return of the completed

assessment roll under

section 7, on his own initiative or where

requested by an assessor, correct errors and supply omissions in a

completed assessment roll, and an assessor, where instructed by a

commissioner, shall correct errors and supply omissions in the

completed assessment roll by means of entries in a supplementary

assessment roll."

Mr. Chairman, this is very broad language. "Correct errors and

supply omissions." What's an error? An error is what the commissioner

says is an error, subject, of course, to an appeal to the court. And so

is an omission. And where does all this go? It goes into the

supplementary assessment roll. Under the authority of

section 6 of this

Act that we're currently debating, the minister said in closing debate

on second reading that supplementary assessment rolls for the tax year

1976 are under the authority of this statute subject to being

re-opened. In other words, through the combination of

section 3 of the

instant Act and

section 6, we have a situation where retroactivity, or

the power to act retroactively, is given in respect of the tax burden

of the previous year.

When you couple that with the extraordinarily wide power given to the commissioner

under this subsection 3 of

section 3, then surely you have a case where this

House is delegating entirely too much authority. And when a bill that the minister

characterizes as a tax reduction bill is, in fact, a vehicle for considerable

increasing of taxes, which may be required from time to time, surely the clear

and specific authority of the House should be given for that rather than simple

and enabling legislation, which is what this language amounts to.

HON. MR. WOLFE: Mr. Chairman, I think it's important to

realize that this is really to provide a clearer avenue of appeal than

a case of supplementary assessment for the taxpayer. Any correction

made by the commissioner, as is referred to in the section, made by way

of a supplementary assessment, provides the taxpayer affected with the

right of appeal that he doesn't presently have. This is one of the

primary matters, incidentally, raised by Mr. Thomas in the various

presentations he has made.

MR. GIBSON: Very well and good, Mr. Chairman, but it seems to

me that the taxpayer only has the right of appeal here on an assessment

that's given pursuant to a new power. In other words, what he can

appeal is a new assessment by the commissioner, but that assessment

didn't exist in the first place. You can bet your bottom dollar that

most of those assessments aren't going to be downwards. In other words,

what we're giving the taxpayer under this

section is the right to

appeal a new assessment which he wouldn't even have had to face at all

before. I don't call that good enough.

Section 3 approved on the following division:

YEAS — 45

Waterland

Davis

Hewitt

McClelland

Williams

Bawlf

Nielsen

Vander Zalm

Davidson

Haddad

Kahl

Kempf

Kerster

Lloyd

Bawtree

Jordan

Shelford

Calder

Curtis

Chabot

McGeer

Wolfe

Bennett

Gardom

Phillips

McCarthy

Rogers

Mussallem

Lauk

Nicolson

Cocke

Dailly

Stupich

Barrett

Macdonald

Levy

Sanford

Skelly

D'Arcy

Barnes

Brown

Barber

Wallace, B.B.

Strongman

Veitch

NAYS — 2

Wallace, G.S.

Gibson

[ Page 688 ]

Mr. Gibson requests that leave be asked to record the division in the Journals of the House.

section 4.

MR. COCKE: Mr. Chairman, I heard the Minister of Finance say

that an ex gratia payment to Prince Rupert, would open the doors to all

sorts of terrible things happening. But we are dealing here with a door

with two handles, and the government controls both those handles. They

control the Assessment Act of this province, and they control Can-Cel,

a Crown corporation, It strikes me that this is the kind of situation

where a government can justify making the kind of ex gratia payment I'm

asking for.

Why do I ask? Is it fair that a community the size of Prince Rupert

should be burdened with an intolerable expense as a result of this

$750,000 fiasco? I suggest to you that it is not fair. It's not fair at

all.

I think that that government can very well stand up right now and

say: "We're not going to leave a community in the lurch." They've been

so used to leaving communities in the lurch, Mr. Chairman. They're

doing it fairly generally now. The only community they really

appreciate is the community that that little minister represents — the

one who's yapping about Ginter at the present time. He represents the

mining community. They're in love with the mining community as long as

they can keep those ads going on television.

But, Mr. Chairman, the fact is the community of Prince Rupert is

badly in need of some equity in this situation. The Minister of Finance

can stand in his place today and say: "We're not going to leave them

with this intolerable situation. We're going to help them." Prince

Rupert, is one of the many destitute areas in the province by virtue of

this government's lack of concern over the needs of people.

Unemployment is at an all-time high virtually, and they're expected to

live with that. They're expected to live with the present Minister of

Human Resources (Hon. Mr. Vander Zalm), whose only attribute to date

has been a smile. They're expected to live with the depressed situation

and try to raise $750,000 extra.

Mr. Chairman, let the Minister of Finance jump up and say that he's going to do the right thing — for a change.

MR. GIBSON: Mr. Chairman, I'm going to be getting on to a

different subject, so if the minister would like to answer the member

for New Westminster now I'll gladly defer.

MR. CHAIRMAN: Please proceed, hon. member, on

section 4.

MR. GIBSON: This is the section, Mr. Chairman, which, briefly

put — and I will elaborate — opens up the taxation of hundreds and

perhaps thousands of farms in British Columbia, and which has a good

chance of opening up the revised valuation, for property tax purposes,

of a major percentage of the industrial plants of British Columbia. Now

section 4(

b) provides that in subsections 24(6)(

a) and 24(6)(

b) of the

existing Act the words "and on the same basis" shall be struck out. The

existing Act, and I'm reading now from 24(6)(a), says: "Except as

provided in paragraphs (b), (

c) and (d), and sections 25 and 27, land

and improvements shall be assessed at the same value and on the same

basis at which the land and improvements were assessed for the calendar

year 1974." That is the core of the issue, Mr. Chairman.

The farmland of British Columbia is assessed as provided for in that

section. Now it is the case — as the minister should know if he has

discussed this kind of thing with his officials — that last year there

were numerous assessments, particularly in the areas of Delta and

Richmond, where farms were reassessed by the Assessment Authority as if

they were urban property, which meant, naturally, that their

assessments increased tremendously. That reassessment was presumably

taken under 24(6)(b)(iii). I presume the authority existed for that. In

any event, the assessments were made. Nevertheless, with the protection

of the language of subsection (b), which we are now being asked to

remove, the owners and operators of bona fide farms were able to go

before the Assessment Appeal Board and have those increased

assessments, and therefore increased taxes, reversed. In so doing, they

had some precise language to rely on. That precise language, more

particularly, was these words, "and on the same basis," which we are

now being asked to remove from this Act.

We are being asked to remove from this Act the protection on which

those small farmers — bona fide farmers — were able to rely before the

tribunal of the Assessment Appeal Board. As I said, Mr. Chairman, last

year there were hundreds of such cases, not all of which went to the

Assessment Appeal Board. When the effect is applied to the whole

province, I am very concerned to, think of the impact that might be on

the owners of small farm properties who are still operating within

areas where the land values surrounding them, because of spreading

urbanization, have substantially increased. The probability is that

their taxes will be escalated because of the reclassification of land,

as is permitted under this Act, unless they have that protection. They

will, therefore, have to pay higher taxes and will not have the

protection of the Assessment Appeal Board because we're removing it

today. That's the first comment in respect to farmland.

[ Page

689 ]

Now I would draw to your attention, Mr. Chairman, that there is

another

section of this particular amendment which will throw open the

whole question of the valuation of industrial land in the province of

British Columbia. That is well and good, you might say — but only as

part of a rational package where we are reforming the property-taxation

structure of this province, not incidentally, in passing, without any

acknowledgement by the government of what it is doing and if, indeed,

it knows what it is doing.

But let's look at what this amendment proposes to do. It proposes to

strike out of the existing

section 24(6)(

c) by striking out the words

"subject to paragraph (b)" and then "and on the same basis."

Next, with those words in mind, I would draw the minister's

attention to a judgment delivered by the Hon. Mr. Justice Craig and

registered in the Vancouver Registry on January 19, 1977. The title of

the case was "In the matter of the Assessment Act, Statutes of British

Columbia 1974,

Chapter 6 and amendments thereto, and in the matter of

the appeal of Weldwood of Canada Ltd. to the Assessment Appeal Board

duly appointed under and by virtue of the provisions of the said Act,

from the decision of the Court of Revision for the City of Port Moody,

whereby the assessments appealed from were sustained."

Now, Mr. Chairman, the assessments that had been appealed were

sustained were as follows: The general assessment went from $667,000 to

$1,161,000; the school and hospital assessment went from $949,000 to

$2,840,000. Consequential increases, Mr. Chairman. I submit to you,

sir, that the increases would have been a good deal higher had not the

words "and on the same basis" been in this Act. In justifying that, let

me read to you to some extent from the judgment of Mr. Justice Craig. I

might say, in passing, that I think we all have to appreciate the

difficulties under which judges act in hearing these kinds of cases

and, for the benefit of the minister in drafting the new Act, I want to

put on the record a statement made by Mr. Justice Craig as to his

difficulties, and I'm quoting here from the judgment: He says:

"The hearing of this appeal ended late in the

afternoon of January 13. By statute I must give my decision before

Friday, the 21st of January. From Monday, January 17, I will be

involved in a two-to-three-week trial on Vancouver Island which appears

to have many complications. Because of the time limit, I must give this

case priority over other cases, notwithstanding the fact that these

other cases may have priority in time or importance.

"Judges have constantly inveighed against the provisions

of this Act which require a decision within 30 days of the filing of the stated

case because, often, the issues of fact and law are very complex and require

time for study and reflection. This case is a prime example of that concern.

I'm rendering a decision in accordance with the requirements of the statutes,

but I'm not satisfied that I've had ample time to reflect properly on

the issues which this case poses."

What a serious statement that is, Mr. Chairman, when a learned judge of this

province has to record to the public that, because of the way our law is drawn,

he might not have had time to give the matter proper reflection but had no choice.

I ask the minister in redrafting this statute — as it must be redrafted — that

he will bear that in account.

Now let me describe a little bit about the case of Weldwood and what

they call their Flavelle Cedar Mill. I think all of us in this chamber

will recognize that Weldwood is a very large company and that they can

probably look after themselves. But this is a precedent that affects

all industrial property in this province.

Mr. Justice Craig, in his reasons for judgment, describes the way that the 1976 assessment was arrived at and, again, I quote:

"The 1976 assessment appealed against was determined

on the current replacement cost as of 1972 as so computed. In arriving

at the current replacement cost, however, the assessor did not use the

historic values used from 1972 to 1975, but rather used a current

replacement cost as of — September, 1975, determined from the appraisal

done by Universal (which is an appraisal company) as set out in

paragraph 11. For, as described by the area assessor, the basis of the

1976 assessment derives from the inventory and actual valuation of the

plant completed in September, 1975, by Universal Appraisal Company Ltd.

See the letter of December 17, 1975, to appellant from the area

assessor with enclosures.

"To this inventory, in actual valuation, the assessor

has applied certain factors to reduce this inventory in actual

valuation to actual value for 1972 base year. The 1972 value as so

determined was then reduced by 50 per cent to determine assessed value."

Mr. Chairman, what that is is a long-handed way of saying that the

1976 assessment was arrived at by completely different means than was

the 1975 assessment. What happened for the 1975 assessment was that the

1972 figure was taken and, as the learned justice says, "factored up"

to produce a particular result. For 1976, the assessor chose, as a

result of certain improvements that had been made since 1974, to take a

current value and factor back. He did that on the basis of the

improvements and as a result of language in the Act that let him do

that.

[ Page 690 ]

Mr. Veitch in the chair.

While the judgment of His Honour is not clear on this, I would

suggest that the value would have been a good deal higher had the words

"on that basis" not been in the existing Act. Those are the words we

are proposing to remove. I'll quote again from the judgment to buttress

that argument. He says here on page 10:

"In my opinion, the word 'basis' in this context means

the particular method which the assessor uses in making an assessment

and the criteria which he uses. With regard to the pre-1974 assessment

of improvements used for industrial purposes, the assessor used the

historical method outlined in paragraph 7 of the stated case."

Then he goes on to consider the meanings of "basis" and then he says what he thinks it means:

"Therefore I think that the phrase means, simply, that

in assessing property to which improvements for industrial purposes

have been made after the preparation of the 1974 roll, the assessor

shall assess the improvements as if those changes in value have

occurred and had been taken into account in a preparation of the

assessment roll for the calendar year 1974."

This to me, in turn, means with the protection of the historical basis.

Now we come to his conclusion on the case. He says, and I am quoting from page 12:

"Theoretically, the method of arriving at the 1972

replacement value by making the replacement costs new prior to 1972 and

factoring up or by taking the 1975 replacement cost and factoring down

should produce the same result. In this case it did not."

I might say, Mr. Chairman, in the opinion I have received from

competent professionals, in a great many cases of industrial property

around this province the factoring-up and factoring-down methods would

not lead to the same results.

Therefore when you are opening that up, you are in effect ending the

freeze. You're ending the freeze on a discriminatory basis. You are

removing the historic protection of that portion of the assets of any

firm which were in place prior to 1974. By taking into account the new

improvements since 1974, you will, from the time you remove the words

"on this basis" from the Act, cause the entirety of the plant and

equipment to be assessed on the present value factored-down method

rather than the historic pre-1974 portion of the plant retaining the

freeze protection or the provision of '72-plus factoring-up method.

That to me is a significant change in this Act.

Listen again to Mr. Justice Craig:

"My present view of the effect of

section 24(6)(c)"

— now that's of the existing statute — "is that the assessor must use

the historical method in assessing those improvements which were in use before

the compilation of the 1974 assessment roll, coupled with the factoring-down

method for those improvements which were subsequent to that time, and that in

making the assessment he may alter the previous assessment to ensure that the

new assessment is on the same value level at which improvements used for industrial

purposes were assessed for the calendar year 1974."

Let me emphasize the first part of that sentence. "My present view

of the effect of

section 24(6)(

c) is that the assessor must use the

historical method in assessing those improvements which were in use

before the compilation of the 1974 assessment roll...." I would suggest

the reason he says that he must use the historical method for that

portion is because of the words "and on the same basis" — those words

which the minister is proposing to remove from the Act today.

So, Mr. Chairman, whether by sloppy draftsmanship or whatever, by

removing these words "and on the same basis" from

section 24(6)(a), (

b) and (c), the minister will effectively, by the time his Assessment

Authority gets finished with doing their job to get the greatest taxes

out they can and by the time the Assessment Appeal Board and the courts

get finished with it, be opening up for substantial reassessment every

piece of industrial property in the province that has had substantial

improvement to plant and equipment since 1974.

As I say, it's long overdue that this be done, but it should be done

in co-ordination with the reassessment of all of the property in

British Columbia and not singled out and certainly not done

incidentally in

an Act which purports to do nothing of the sort.

To me, Mr. Chairman, this is a very wrong section. When you couple

it with the

section we just passed which makes it possible for the

commissioner, through additions to the supplementary rolls, to add at

any time of the year those increases he sees fit, then it's very clear

that what an assessor can do on any piece of farm or industrial

property that suits his purpose is to call in an assessor, get a

current value, factor down, have a look at whether that exceeds the

1974 value, and, if it is, that's the new assessment. It's added to the

supplementary rolls. The tax is increased not just for this year but in

theory is recaptured for the past year, because the minister said in

his remarks on closing second reading that the supplementary rolls for

1976 would be affected by this legislation,

So to me this

section is thoroughly pernicious legislation. I believe that this House should reject it out of hand.

[ Page

691 ]

HON. MR. WOLFE: Mr. Chairman, in dealing with

section 4, the member for North Vancouver–Capilano,

who just took his seat, is quite concerned about the use of the words

"and on the same basis," and the removal of those words from various

parts of

section 24. He made reference, in fact, to the decision of the

judge in the Weldwood case. In my view, he made the recommendation in

his report that we must use the historical method to arrive at

valuation on new improvements or additions since 1974. The removal of

these words is, in fact, to clarify that very point.

This has been a matter of indecision and inappropriate wording,

insofar as how it is applied, because the commissioner and the

assessors view the term "and on the same basis" as throwing ambiguity

on whether they should factor back or factor forward from 1974. So I

would disagree with the contention that this is reopening the

possibility of a different type of appraisal as applied to new

improvements on industrial equipment.

Any new development is now covered under

section 24(b), to which I

would refer the member. He is suggesting that we'll treat new

improvements on a different basis. I disagree with this. They are to be

handled in exactly the same way they are now. The removal of these

words is only to clarify the present method being used, the frozen

assessment of 1974, and applying the historical method of valuing

improvements or additions since that point in time.

By way of explanation, I would also comment once again on the Prince

Rupert and Can-Cel appeal. The largest part of this reduction is

concerned with machinery and equipment, and a smaller part of it has to

do with structures. So the machinery and equipment part of the

reduction really only bears on the school tax

section of that district.

The other would bear on the general revenue side of their tax structure.

MR. GIBSON: Mr. Chairman, having followed the minister's

words carefully, I can't believe that he has read the decision of the

learned judge. Perhaps since it was only filed on January 19 he hasn't

had time, He said that the purpose of removing those words was to

remove any ambiguity and thereby....

Interjection.

MR. GIBSON: That's what you said; that's what the minister said.

He said that the purpose of removing these words was to remove an

ambiguity and to protect the historic method. But, Mr. Chairman, the

historic method relies on those words "and on the same basis," because

"the same basis" is the basis of factoring up from 1972. That's t