1981 Legislative Session: 3rd Session, 32nd Parliament

HANSARD

The following electronic version is for informational purposes only.

The printed version remains the official version.

Official Report of

DEBATES OF THE LEGISLATIVE ASSEMBLY

(Hansard)

TUESDAY, MAY 5, 1981

Morning Sitting

[ Page

5391 ]

CONTENTS

Routine Proceedings

Committee of Supply: Ministry of Consumer and Corporate Affairs estimates. (Hon. Mr.

Hyndman)

On vote 44: minister's office –– 5391

Mr. Levi

Mr. Barnes

TUESDAY, MAY 5, 1981

The House met at 10 a.m.

Orders of the Day

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

ESTIMATES: MINISTRY OF CONSUMER

AND CORPORATE AFFAIRS

(continued)

On vote 44: minister's office, $147,465.

HON. MR. HYNDMAN:

Pursuant to our discussions in committee last evening, what I propose

to do this morning is to provide a comment on the question raised by

the member for Maillardville-Coquitlam (Mr. Levi) with respect to the

scanner task force, and then to provide some general commentary about

the work of the ministry over the last year.

The member

raised the question of the resources with which the task force would be

equipped to do its work. Most certainly we will want to see the task

force equipped with sufficient resources to do a thorough job. On the

other hand, we'll certainly have regard to concerns about reasonable

limits on expenditure — those concerns have been echoed by members

opposite during the course of debate this session. I expect to meet

with Professor Shapiro early next week and discuss in some detail the

manner in which the task force will do its work. As I say, we'd

certainly like to see it able to do a thorough job consistent with some

reasonable limit on expenditures at a time when I think members on both

sides of the House are of the view that government has to be quite

prudent in budgeting and expenditure practices. I'm confident we can

have the committee equipped to do a thorough job resulting in a useful

piece of research.

By way of general introduction, could I

now turn more generally to the Ministry of Consumer and Corporate

Affairs and its work over the last year. During the last year it has

been my pleasure to come into the ministry — a little late in the

piece, as members will realize — and therefore part of the ground I'll

be covering reflects the progress made and work done by my predecessor,

who is now the Minister of Health, the member for Richmond.

do look forward to the comments of all members in these estimates —

particularly, may I say, on the general question of liquor policy. I

will be outlining again some of the questions that the ministry is

looking at with a very open-minded point of view, and I think on a

number of the broad areas of liquor policy they are issues of social

interest and not really political in nature. I look forward to — and

indeed I ask members for their comments — suggestions and views as to

where liquor policy in British Columbia should be going in the early

1980s. I think represented in this chamber — on both sides taken

together — there is a very useful cross

section of background and work

experience which can bring comment to bear on liquor policy questions.

I do want to pay tribute to and express my thanks to my predecessor, now the

Minister of Health, the member for Richmond, the Hon. James Nielsen. I do want

to stress that in coming to the ministry, I found it in an exceptional state

of good organization. I think that reflects on the approach by the previous

minister, and certainly my transition into the ministry was made much easier

by the well-organized basis upon which I found the ministry and the ready cooperation

and assistance which my predecessor gave to me. I also want to commend Mr. Peter

Bazowski, the deputy of the ministry, who has been most helpful since my arrival

here, both before and after his departure for the Ministry of Health.

members will know, Thomas Cantell, QC, has been appointed acting deputy

minister, and in the several months he has been in that post he has

been of tremendous help to me in getting comfortable in the ministry.

Mr. Cantell, as members will know, is a highly experienced senior

public servant — not just in British Columbia but in this country — and

brings to his post a background, a point of view, a perspective and a

philosophy that reflect many successful years in the public service of

this province. I appreciate Mr. Cantell's agreeing to act in this

capacity.

Members will, I think, on reflection readily have

come to mind the major divisions of this ministry, which include the

consumer affairs sector, the corporate affairs sector, liquor control

and licensing, the liquor distribution branch and, of course, the

office of the rentalsman.

May I make a few comments now

concerning the office of the rentalsman, because there were several key

changes to the Residential Tenancy Act during 1980-81. The annual rent

increase limit was raised in May 1980 from 7 percent to 10 percent to

reflect the prevailing rate of inflation. Other amendments were brought

in last year aimed at simplifying technical procedures in the

landlord-tenant relations area. These were substantially proclaimed in

January of this year.

These amendments, Mr. Chairman, were

based on points of view and recommendations received from each of the

landlord and tenant groups, and they were designed to improve the

investment climate for new rental housing while limiting abuse among

protected tenants. These changes have already greatly assisted the

renting public and landlords by reducing workloads of the office of the

rentalsman and, hopefully, enabling the landlords and tenants more

directly to work each with the other.

I think, Mr. Chairman,

that I should pause here and say a few words about the general

responsibilities carried by the office of the rentalsman and the

rentalsman staff across the province. I think there are few jobs in

British Columbia, inside or outside the public service, more difficult

and challenging than those in the office of the rentalsman. I think the

people working in that office must bring to the task a very complicated

and technical knowledge of legislation. They are very often

adjudicating serious economic and property rights or interests between

landlords and tenants. There is a great need to attempt to resolve the

human issues between parties in conflict, and it has been my experience

that the staff in the office of the rentalsman across the province do

this province yeoman service. They have an extremely pressure-ridden

type of job.

I think they work hard at being impartial and

fair, and my impression is — it being a difficult and controversial

area — that like the minister, the staff of the office of the

rentalsman does get shot at. My impression is that to the degree

they're shooting, it's coming equally from both sides — the landlords

and tenants. If that is happening, I think it reflects a very real

effort by the staff to walk independently and fairly down the middle.

The

rent review provisions, Mr. Chairman, had a key change in the last year

in that as a result of that change most tenants may now appeal what

they consider to be excessive

[ Page 5392 ]

rent

increases. Rent review was broadened to include tenants living in units

renting up to $700 per month, units first rented after January 1, 1974,

and to permit appeals of excessive increases occurring on or after

January 1, 1980.

Another important change created concurrent

jurisdiction of the rentalsman with small claims court by allowing

landlords and tenants the alternative of taking damage or debt claims

of up to $2,000 to either the rentalsman or small claims court for a

$10 filing fee. This change has resulted in speedier resolution of

disputes and improved service to the public.

[Mr. Strachan in the chair.]

Another

change was the merger of the Rent Review Commission with the office of

the rentalsman to provide one stop dispute resolution.

We've

all observed the strong performance of our provincial economy relative

to other provinces, and this, as I think members appreciate, has

resulted in record levels of interprovincial immigration. Increased

demand on a limited supply of housing has, of course, caused

considerable growth in real estate prices despite record levels of new

housing production. For many this means that home ownership is

financially very difficult. I'm extremely pleased to report that at a

recent workshop sponsored by this ministry members of the real estate

and mortgage lending industries indicated great willingness to

cooperate with government in addressing the key issue of home financing

into the 1980s and 1990s. In the meantime high mortgage-interest rates

and high demand for housing have also put extreme pressure on the

rental housing market. Tenants are faced with critically low vacancy

rates in major urban centres of the province, and the natural trend to

increasing rents in this most desirable part of the country has

directly affected the workload of the rentalsman.

One thing

I would also like to comment on is the effort by the office of the

rentalsman to promote dialogue between landlords and tenants in an

effort to see if, in discussing matters of rent increase and

landlord-tenant problems directly, they might not resolve many issues

without the need of coming to the rentalsman's office. It's certainly

the strong impression of the staff of the office of the rentalsman that

if landlords and tenants who have an apparent dispute will sit down

calmly and attempt to discuss the reasons and problems, matters can

very often be resolved.

To assist in that, in the last

several weeks we have commenced forwarding to all tenants in the

province occupying multi-unit residential premises a new booklet

entitled, "Renting? Renting? Renting? Guide to Landlord Tenant

Relations under the Residential Tenancy Act." The purpose of that

booklet is to provide much greater understanding by both tenants and

landlords of the policies and regulations presently enforced in the

province. We hope that that useful guide, which not only explains the

substance of the law and the regulations but also contains a very

effective question-and-answer

section dealing with the most frequently

found questions and answers, will greatly assist tenants in

understanding their rights and landlords in understanding their

responsibilities. We hope that that booklet will go a very long way to

equipping tenants and landlords for more dialogue and for getting along

better in this very difficult rental market.

In terms of liquor policy, Mr. Chairman — if I may move to that topic for a

few minutes — may I stress how very much I'd like to invite members during

these estimates to provide their comments on the broad questions of liquor policy,

as to directions in which they suggest the province can or should be going or

should be considering going. I think the guideposts of liquor policy in the

province must be twofold — those of maturity and moderation. By maturity I mean

policies which are designed to encourage maturity in the consumption and use

of alcohol; by moderation I mean policies encouraging people to be moderate

in their drinking habits. As the converse of maturity and moderation as goals,

we wish, through our policies, to discourage or limit the social abuse of alcohol.

Now

within that broad set of guidelines, a specific policy has to be made

or changed. Members will be aware that the ministry is presently,

because the topics are quite lively in the public mind, conducting a

review of several policy areas. I certainly have an open mind on these

topics, as does the ministry. If there is to be useful change or

amendment, it will be the product of informed public opinion and of

members in this chamber individually outlining their points of view,

which, it seems to me, as I say, are really not a matter of partisan or

label politics, but rather should reflect the practical wisdom and

experience of various members, given their backgrounds, their

traditional occupations and what they hear from their constituents in

their particular regions.

Obviously, Mr. Chairman, one of

the most lively questions of public interest these days is whether or

not beer, wine or both should be available in grocery stores in British

Columbia. I hope that by late summer or early fall enough listening and

research will have been done by this ministry that we'll be in a

position to give a contemporary piece of research to the government and

to cabinet for consideration for a decision either to maintain the

status quo or to make an amendment. Certainly, because that topic is so

lively, I would greatly value comment by members concerning it.

second and very lively topic is the question of the electronic

advertising of beer and wine in British Columbia. Again, I think

members are well aware that many argue that there exists today a

discrimination in that beer and wine are prohibited from being

advertised on the electronic media — radio and TV — in British

Columbia. The argument runs that because beer and wine can be

advertised in print, it is a form of discrimination against the

electronic media. Further, because electronic media operating outside

British Columbia's borders can beam commercials into British Columbia,

that is further discrimination against British Columbia radio and

television stations. Again, I would greatly value the comments of

members on that question.

The third extremely lively issue

is the question of private wine stores. Certainly if my correspondence

is any barometer, across the province there is a very lively interest

in the possibility of private wine stores. Again, the ministry has

developed no policy position on that. We certainly glean a

cross-section of interest around the province on the topic. It's an

area in which the comments and experience of members would be most

valuable.

Those are the three most lively topics of liquor

policy that have come forward in the last year, Mr. Chairman. There are

certainly other more specific topics on which I'm sure members will

comment.

If I can move briefly to the question of liquor

distribution under present policies, the rough numbers are that the

liquor distribution branch has approximately doubled its distribution

since 1977 from about five million cases of product per year to

approximately ten million cases in the last year. We

[ Page

5393 ]

would now appear to be operating at near peak

capacity in our Burnaby distribution centre, which is to date the only

distribution centre or, if you like, warehouse in British Columbia. To

date that is the only distribution unit from which supply has radiated

to all parts of the province. However, in order to meet increasing

demand for product as the province grows, a decision was made in the

last year to proceed with plans for a second distribution centre, this

one to be decentralized and located in the central interior, in

Kamloops. This new and second distribution centre, which is to be

opened in July of this year, will serve 62 stores and ultimately

achieve an additional capacity of between four and five million

additional cases per year.

With respect to liquor stores

themselves, in the last year the liquor distribution branch opened 12

new or replacement stores and upgraded or renovated seven stores to

self-serve. There are now a total of 212 government liquor stores in

the province. In addition there are 58 agency stores. Members may be

familiar with these. In the lower mainland Bowen Island is the most

talked-about example. Under the agency store concept, people normally

running grocery or general stores are permitted to have a limited

capacity to sell some liquor products, as a matter of convenience, in

areas where normal LDB service is not available. Again, because these

stores are frequently found in the interior or outlying areas I would

value comments from members as to whether they are proving worthwhile

and whether they constitute a type of approach to the vending of the

product which should be encouraged. Alternatively, if members feel

local communities are encountering problems or inconveniences with,

these stores, we'd certainly like to hear about them in the course of

these estimates.

One of the major events in liquor

distribution last year was the unfortunate labour dispute between the

three major breweries and their workers. In an attempt to meet public

demand for beer during that difficult period we increased importation

of the four listed American beers — a move that had the initial

blessing of the brewery workers' union. I don't propose to go into a

discussion of the subsequent labour relations aspect of that dispute,

as one aspect of that matter is still before the courts. But I will

point out that we responded positively, I think, to this crisis by

amending our liquor regulations to provide for special ordering of

unlisted products including beer for licensees. Those changes in the

regulations will go a long way toward preventing future problems in

this industry and will certainly protect the public interest should

such unforeseen difficulties arise again.

A major highlight

in liquor distribution during the last year was the introduction of

point-of-sale cash registers. I commented briefly on that yesterday.

The feedback coming to us in the various liquor stores seems to be

extremely positive. Unlike some of the public resistance to electronic

cash register scanning systems in supermarkets, we think patrons in the

LDB stores are finding the new type of register there to be

satisfactory. The benefits of the system include faster service, a

fully descriptive customer receipt and more accurate transactions.

Another major milestone last year within the LDB was the opening of what you

might call the flagship store on Cambie Street in Vancouver. This is a most

attractive facility with 22,000 square feet of floor space. It offers all of

the branch's 1,200 general listings and 300 specialty products — that's

1,500 listings — plus 100 additional products unique to the Cambie store. These

include rare and premium wines displayed by country and region of origin. We

think it's one of the finest stores of its kind in North America, and the

consumer and citizen response is very positive.

Turning

now to liquor control and licensing, restrictions on the consumption of

beer during professional baseball games were modified last year.

Previous regulations restricting the consumption of beer to a

marked-off area beneath the stands were modified to permit consumption

of the beverage by adult patrons in the stands. This was a much

heralded step towards more civilized attitudes in the control of liquor

dispensing, and it proved very successful. I'm pleased to say that

drunkenness, litter and related problems were substantially reduced as

a result of this initiative. I'm one of those who ranks himself as a

reasonable baseball fan in this province, and certainly over last

summer I enjoyed a number of Vancouver Canadians baseball games.

Frankly, I enjoyed a beer in the stands, and I was very favourably

impressed as an observer by the very responsible degree to which

baseball fans were conducting themselves with the new capacity to enjoy

their beer in the stands on a pleasant summer afternoon or evening.

a separate step forward we modified rules for restaurants to allow them

to make optimum use of their facilities. We also reinforced existing

policy with regard to holding areas to ensure that licensees don't feel

they can make their own rules to the detriment of the community in

which they operate. At the same time we again indicated our willingness

to modernize our liquor policies by revising a previous limit of 50

patrons per holding area, by eliminating the old 40 percent food, 60

percent liquor ratio, and by allowing background entertainment in the

holding areas. Needless to say, those changes were welcomed by the B.C.

restaurant association.

A number of technical procedural

amendments were introduced last April to clear up some ambiguities and

deficiencies in the present act and to make it easier for licensees to

deal with government. Other amendments were made to the regulations

under the Liquor Control and Licensing Act, permitting Sunday sales in

designated resort areas, extending Sunday hours, and limiting maximum

capacity in neighbourhood pubs and marine pubs to 65 persons.

Pausing

on marine pubs, there are only four presently in the province. The

marine pubs and how they're operating is a topic on which I would

appreciate the comment of members. I'm pleased to see the member for

Shuswap-Revelstoke (Mr. King) here today. I understand that there is

one marine pub which has been in operation on Shuswap Lake, and I would

value his comments as to how that one is getting along in terms of its

success, and the community reaction, and if it's genuinely serving

tourists in the area in terms of the original intention of marine pubs.

The

branch continued its full support, Mr. Chairman, for the RCMP and

Vancouver city police walk-through programs, whereby those agencies

supply us with reports on the operation of licensed premises. The

branch has followed up unfavourable reports with disciplinary action,

and has made a point of complimenting any licensee whose operation is

run according to the letter and spirit of the law.

Late last

year we freed the price of beer in licensed establishments to encourage

better service, atmosphere and entertainment than that traditionally

supplied in the so-called "big bar and beer parlours." That freeing of

the price of beer in the pubs seems to have been a very great success.

We detect across the province now some variation in price of beer

[ Page 5394 ]

the pubs and hotels, with some accompanying variation in the range or

quality of the entertainment and service offered, and patrons seem to

enjoy that range of choice.

More recently we also freed beer

prices at the liquor store level to promote competition among the

brewers for the benefit of consumers. It's a little early to tell how

successful that policy is going to be, but I am very hopeful that we

are going to see some price competition in packaged beer at the store

level between brewers, being very mindful of the fact that my good

friend, the member for Maillardville-Coquitlam (Mr. Levi), in hearing

of the policy, predicted that beer would be $10 a case within the year.

We'll have to see if his prognostication turns out to be correct, or if

the brewers are able to come up with the kind of price competition that

we'd like to see.

Another highlight, or perhaps I should say

a milestone, which this assembly is well familiar with was the

retirement of Vic Woodland as general manager of liquor control and

licensing. As hon. members so warmly expressed when Mr. Woodland was

honoured here on the floor on March 19, this dedicated, highly

respected gentleman played a key role in the modernization of liquor

regulation in the province under both administrations. I am confident,

Mr. Chairman, that Mr. Allan Gould, who is Mr. Woodland's successor,

will continue to provide this province with the excellent

administrative skills, the patient ear prepared to listen, and the

large quantity of common sense to which we have become so accustomed

during Vic Woodland's tenure in office.

A major objective of

the ministry commencing in the next fiscal year is to enact a new

liquor control and licensing act with appropriate regulations.

Furthermore, a major project to produce the policies of the branch in

precise written form is well on the way to completion. I think finally

I should comment briefly on the Main and Hastings liquor store

situation, which has been a topic of great concern to the Downtown

Eastside Residents Association and to many in that area of Vancouver

East. I wanted to take an early and personal look at that situation,

which I did about six weeks ago. I sat and listened with great

interest, at the behest of Alderman Bruce Eriksen, to a number of

briefs presented in that area, particularly those briefs arguing for a

closure of the store. Since that time, having had the chance to study

those briefs arguing for closure of the store at Main and Hastings,

we've also had some input from residents and small business people in

the area who argue that there are reasons why the store should stay

open.

Both points of view in that community will receive the

same equal and fair treatment from myself as minister. On Saturday

morning, May 23, the ministry itself proposes to convene a Saturday

morning community workshop on the topic, and the purpose of that, Mr.

Chairman, is so that those people in that community who argue that the

store should stay open will have their opportunity, along with others,

to publicly present their point of view. We'll be inviting both points

of view to the community conference, and we certainly think it's only

fair that before the ministry makes any decision both sides be given

the full opportunity for public hearing in that community. I'm very

hopeful that both points of view in the community together can perhaps

come up with a consensus that will give the ministry a very helpful set

of guidelines and rules. We would far prefer, rather than taking sides

with one point of view in that community, to work with the community in

attempting to achieve a community consensus. If that can be reached, I

think we're well on the way to dealing with the issue.

the corporate side of the ministry, amendments to the Company Act were

introduced during the year. Those were intended to clarify existing

sections and simplify internal procedures relative to the Companies

Act. Those changes will assist the public, the legal profession and the

ministry itself, in complying with the act. A significant change to the

legislation will provide for companies based in other jurisdictions,

but operating in B.C., to file their annual reports within two months

of the anniversary date of registration. That will enable us to spread

the large volume of filings over the year to balance our workload. This

improved processing of corporate data will provide the public with

better information about the activities of corporations doing business

in this province.

Last year we reached an all-time record of

incorporations: more than 21,000 new companies incorporated in B.C., a

very healthy indication of confidence in the provincial economy and the

growth in business activity, particularly small business activity. This

increase is very reassuring for British Columbians. In the office of

the registrar of companies our priorities are to obtain a reasonable

staff complement and to implement a microfilm program to convert some

200,000 paper files.

Mr. Chairman, I see that you are

drawing my attention to the clock, and perhaps I can pause. I have

perhaps ten more minutes of comment. So if my good friend opposite

wishes to comment now, that's fine with me. But if he cares to give me

30 seconds of comment, I will happily finish my notes and then take

notes furiously as he opens his address.

MR. LEVI: I

think we'll just let the minister take a rest. We want to deal with one

specific thing rather than go through the smorgasbord that the minister

has dealt with, and give him a chance to think about some of the things

we are going to say about an area which he dusted over very lightly and

which, as I think he and everybody in this House know, is one of the

most serious issues out there right now. It relates to the problems

that tenants have and, of course, to the work done by the rentalsman.

Just

for the interest of the minister, one of the things we've observed with

the government for the past six years is that they have absolutely no

consistent policy on rent controls or any policy to do something about

housing. In the four short months that he's been the minister, the

minister has had a lot to say about it. We've had some difficulty over

on this side pinning down just where the government is.

should be remembered that when rent control was introduced in 1974

there was a great deal of debate as to whether it could work at all.

What most people seem to forget about the issue of rent control is that

in 1974 it was a very specific piece of social policy that was done to

meet a very urgent need: the problem of people who were having to pay

rapid increases in rent as a result of what the apartment owners and

the people who rented the accommodation felt they were entitled to.

Some balance was achieved by 1975 — not the balance that the people who

rented homes wanted, but nevertheless by November 1975 the rent

increase allowable was at 10.6 percent. That was a long way from the

amount of money wanted by the apartment owners and the people that do

the renting. They wanted something like 29 percent.

Nevertheless,

by November 1975 the agreed amount was 10.6 percent. That appeared to

be a level which at that time and for the next several months would

have been a workable situation. In December the government changed. It

should be

[ Page 5395 ]

brought

to mind that the government had campaigned on the issue that it would

not remove rent controls. That was their issue. They said it very

specifically very many times, and we've repeated it many times in this

House. They put out a large number of ads and talked about how they

would not do away with the rent controls. Some time after they assumed

the government, they took the allowable increase from 10.6 percent down

to 7 percent. That was the first time that the whole system became

unequal from the viewpoint of the landlords. There had already been an

acceptance and an understanding that 10.6 would be the level, but it

went down to 7.

Then we went through a two-year period when

the government was going to move toward removing rent control. We knew

where the government was going in respect to doing anything at all

about housing, because in 1976 the then Minister of Housing said we

were getting out of funding co-op housing. They would do nothing about

making provisions even for social housing. By 1978 two remarkable

statements were made, one by the then Minister of Housing and the other

by the Minister of Consumer and Corporate Affairs. Both said: "We now

feel that it's possible to start getting out of rent controls, because

it looks like there is going to be a reasonable vacancy rate." There

was no evidence of this whatsoever. There was going to be a major

departure in government policy on rent controls: the complete breaking

of a promise they had made some two years earlier that we would not get

out of rent controls. Neither of those ministers produced any evidence

to substantiate that the vacancy rate was improving. The fact is, in a

retrospective view, that they were not. At the time they started to

remove rent controls the vacancy rates were rapidly going down, and

there was no indication whatsoever that those rates would improve over

a period of three or four years unless there was some government

involvement in making some of these things happen. The housing starts

were not very high. This year housing starts will finish at a high

level — somewhere around 37,000 because we're in a year of catchup.

After all, the previous two or three years were way below 1973 and '74.

to move out of it, and they did move out in the sense that they reduced

the peak levels of 500 and 400 and they started to come down. Since

then has been the most serious problem we've seen in this province.

I'm

convinced the government has a policy in respect to tenants — people

who have to rent — which is tantamount to saying: "Let them sleep in

the streets." This minister gets the same kinds of letters as every

other member of this House gets. Last week when I spoke to the people

from Red Door and to Tom Lalonde, who is with the greater Vancouver

tenants' association.... A month ago in east Vancouver, on Commercial

Drive, people were served a notice in which their rent went from $365

to $625. The question the minister has got to ask is: how do you reply

to people who have to move out because they can't afford that? Where do

they go? I'm informed by the Red Door and agencies that deal with these

problems....

Nobody is downplaying the role of the

rentalsman's office; they're overloaded and trying to cope with some

impossible situations, particularly in view of the changes with respect

to rent review. Rent review would be okay if they had enough staff that

they could meet all these tasks. So you rely on the community groups

like Red Door and the tenants' associations to do the advocacy and the

searching for accommodation.

What do you do? That is the

real problem today. We're talking about social policy solutions that

have to take place now. Those solutions do not lie in some of the

minister's ideas for variable mortgages like shared-appreciation

mortgage, some wraparound financing, or the banks coming in to do

something about lowering the mortgages. Those are all necessary, but

how do people face the problem they're facing now? Several times in

this House we have asked that you reimpose the rent controls at levels

that are going to help people. There is nothing you can do in providing

new housing stock which will show any kind of reality for the next 12

to 18 months. That does not help the individuals today. That's the

basic problem.

Right in the middle of people on fixed

incomes suddenly being faced with their rent going up anywhere from 10

percent and landlords having to go back to refinance the mortgaging,

the government is constantly saying: "Yes, we're getting out of rent

controls." Now the minister says: "No, we're not getting out of rent

controls." But in the meanwhile the level of rent controls is

inadequate to meet the problems everybody has today. That's the great

danger. The $300 level for the bachelor pad, the one-bedroom at $350 or

the two-bedroom at $400 are not adequate, because you have to look at

both sides of it. There certainly are sides to that question.

Now

because of high interest rates, landlords are coming back more and more

to the rentalsman and saying: "I need a second increase in the middle

of the year." I use my own accommodation as an example. In August 1980

we were served with an increase which represented not only the 10

percent but an increase for some work which was done plus a mortgage

increase. That was settled by a public hearing with the rentalsman. In

November the reduced rates went in, and in April we received another

notice that the landlord wants another increase. One of the changes

that was made last year was that now we allow the landlords to go back

to tenants without the three months' notice; they can go back on four

weeks' or six weeks' notice and say: "We want more money." This is

around the issue of the mortgage rate — that's one of the bases on

which they can go back. If the costs are going to increase because of a

renegotiated mortgage, you can go back to the tenant.

There

are problems on both sides, but the basic thing is: what is the

government going to do about it now? It's no good the minister telling

us: "We're very concerned; we would like to see more investment in

housing." That's not going to solve this immediate problem. I'm

informed that last week in the Vancouver area alone — because there

they have the community groups that are working on this — over 200

people a night slept in accommodation that's not in a house, not in a

room. Usually it's in a car, under a bridge or wherever. That's the

kind of thing that's going on. The question mostly relates to what

happens to people when they have to get out of accommodation that they

can't afford. Where do they go? Now if the ministry is prepared to view

this as a crisis — and it is a crisis.... That's at the level of people

who are on fixed or low incomes, who simply can’t meet the increases.

Many of those people are having to hunt around for other kinds of

accommodation, and some of them are not finding it. You've got a Red

Door registration level of 900 people on the waiting list looking for

accommodation, and the problem in that list, I'm informed, relates

particularly to Indian people, who have great difficulty getting

accommodation. The other one is the single parent with children.

[ Page 5396 ]

But

it all relates back to what the government is prepared to do at this

time — not 18 months down the road — about looking at the rental

accommodation at the levels at which people can charge. Yesterday the

minister came in, and after three years of debate from this side of the

House he produced what makes some sense — there'll be a moratorium on

the whole question of the scanners. Well, he now has to make a move in

this area. What is he prepared to do?

We don't need any more

discussions from the minister about how mortgages might be made in a

reasonable way, so that people can get into housing. We have to look at

the problem which affects literally thousands of people in the

province, particularly in the major centres where people are heavily

congregated. If he doesn't do something about this particular issue,

he's going to find that the whole non-policy is going to be so

counterproductive that we have all sorts of negative spinoff effects

which were not previously thought about.

Let me give the

minister an example. Two weeks ago the department of economics at UBC

announced it had cut the class size from 500 to 375. The reason given

was that they could not hire the instructors for those classes because

they couldn't find accommodation. We have the same problem in the

province. If you go into a technology that is new, you have to find

people who can make a contribution to whatever new efforts you're going

into industrially, and then suddenly you bring the people in and they

can't find accommodation. This is a problem that affects literally

thousands of people across the board, including the government and

industry. The answer is not to tell us that 18 months down the road

you're going to have some more housing, because in this province we are

a long way from having the kind of vacancy rate that will create the

kind of competition that that side of the House has always dreamed is

possible in the free enterprise system.

The minister

mentioned in passing that now he's freed up the price of beer, that we

might look forward to a reduction in the price of beer. Well, you know,

since I made my statement that it's going to be $10 a case, you pay

$10.75 in a beer parlour now. The point is that that system does not

work in terms of these problems. If you can bring in a moratorium in

respect to scanners, then you'd better put a moratorium in the

legislation around the issue of rent controls — looking at the mortgage

situation and talking to the banks. In the midst of all these problems

we have, we have the horror story of horror stories — an obscenity that

came out last week — that in the first three months of this year the

Bank of B.C. made 300 percent more money than it did in the last

quarter. In the midst of this terrible crisis, that's what we see.

We're

talking now about immediate social policy. From time to time

governments have to make quick, reasonable decisions. It's not that

it's a question of acquiring all the knowledge; the rentalsman has all

the information. He's got an operation down there in which he has every

single rental accommodation in this province listed, within about 2 or

3 percent. He has a complete understanding of what rents are being paid

and of the income of the people who are having to pay these rents.

That's the immediate, serious problem that we have right now. It's not

going to get better; it's going to get worse with the kind of

immigration we have in this province and the kind of competition there

is for housing. My colleague from Vancouver Centre is going to talk

specifically about the area he represents in the West End. But we have

it across the board, particularly in the large areas, and the minister

has not yet indicated he's prepared to come to grips with this

particular problem — the problem of what he is going to do about people

who are being threatened on an almost daily basis with an increase in

rents. The mortgage problem is not his direct problem, it's related to

the bank rate. The point is, what kind of measures is he prepared to

talk about?

For instance, the major amount of work in the

rentalsman's office deals with these kinds of complaints. There are

things that have to be arbitrated, but his staff can't do that. We saw

what the government did in 1976, after it came in, to destroy the

community offices set up by the first Minister of Consumer Affairs.

They were useful, on-the-spot agencies which dealt with people's

immediate problems. At the moment we only have two of those in the

lower mainland, yet there is pressure for people to find accommodation

which they can afford to live in.

Frankly, we're not

interested in seeing the federal minister, Mr. Cosgrove — who has

literally no clout in cabinet — talk about the possibility that he

could come up with some $500 million for the whole country, which would

represent transfer payments and from which people would get a subsidy.

It's

my impression that that minister and the government have bought all the

stories told by the Fraser Institute about the horrors of rent control.

Yet nothing at all has been demonstrated. Alberta doesn't have rent

control, and they have a low vacancy rate.

Don't tell us

stories about the horrors of rent control. I can tell you stories in

which people's lives have been saved in terms of having nowhere to live

because of rent control. If we had not introduced rent control when we

did in 1974, God knows what the situation would have been today.

That

government was prepared to capitalize on their statement that they

would not remove rent control. In 1978, at the very time they should

not even have been thinking about it, they started to tinker and reduce

the levels on which there were controls. What do we have now? We have

moved from that group who traditionally had problems — low-income and

fixed-income people — to those who are working and who have joint

incomes of $20,000 and $30,000. They are facing the same kinds of

problems. We had the case of the lady down on Chilco Street whose rent

went from $700 to $1,100 just because it was an opportune time for the

landlord to make more money. That's the kind of thing that needs to be

investigated.

Second, a reasonable return on investment.

Yes, that's the nature of the system. Unreasonable return on investment

— no, absolutely not. It no longer touches just the people with whom we

constantly concerned ourselves when we first brought in rent control.

It came in at about the same time we brought in — and made work — the

Mincome program. We didn't want to see people's incomes, which were

increased, suddenly go to paying more rent because the landlords

thought it was an opportunity for them to do this.

The

minister has to sit down and make a policy with his government and with

his colleagues. Does he have any idea how much of the taxpayers' money

is going to pay rents through Human Resources? Incredible rents are

being paid for. The rent allowances in some cases run as high as $700

and $800, depending on the size of the family, That is happening.

There's an enormous amount of money going to pay high rents because

there is no comprehensive policy by that government. They've

wiffle-waffled all over the place.

[ Page 5397 ]

They

are going to remove rental control because it might suit their friends

and supporters. When they campaigned they said they wouldn't remove

them. The first thing they did.... Presumably their friends suddenly

got hosed because the rate allowed them went from 10.6 percent to 7

percent. Then three years later they decided to put it up to 10

percent. In 1980, when the amendment was brought in, there were changes

which were significantly beneficial to landlords. There was a 40

percent increase in the allowable rent increase. There was a 50 percent

increase in the allowable charge for repairs, beyond customary

maintenance. It's true that at the same time we started to deal with

high interest rates.

The minister's response to this is that

the only solution is more housing stock. Well, that's very nice. There

are no plans at the moment to create more housing stock than we have.

There is no government policy. What we do need is a government policy

and a statement from that government that they're prepared to look

realistically at the daily problems tenants have.

Out there

you have created a group of people who are so demoralized.... They are

mostly in the older age group — have always paid their own way — and

they never quite know from one month to the next whether their rent is

going to go up not once but for a second time. The new horror story

about the rent control amendment is that it can happen not just once or

twice; it can even happen three times. That's what's happening out

there. People are literally horrified at the prospect of when it's

going to come again. That is a real daily problem that you have not

addressed yourself to. If you are going to address yourself to

scanners, then you had better address yourself to the problem of what

people are going to do in terms of your policy of the gradual removal

of rent controls. One day you say yes. One day you say no. What is the

policy of the government? What are you prepared to do to take some of

this pressure off people who are not quite sure whether they're going

to be able to afford the accommodation they live in two months down the

road? That's the kind of problem you have to address yourself to. You

haven't done that at all.

The minister ran through a

catalogue of the kinds of things that are going on his department.

We'll get to those things. What we want to do at the moment is to have

the minister think very seriously about what he can offer. Let me give

you an idea of the way the minister was thinking on March 17 when we

asked him a question about rent controls. This is a partial reply which

appeared on March 17, 1978. Let me quote the whole statement. I said:

have a question for the Minister of Consumer and Corporate Affairs.

Rents for one-bedroom units under rent control are less than $300 a

month; a two-bedroom apartment rents for less than $350 per month.

Market rents in the Vancouver area for uncontrolled apartments are $450

for a one-bedroom and $600 for two bedrooms. Thirty-five thousand

housing units will be decontrolled this year. Has the minister decided

to halt any further decontrol of rental accommodation to prevent severe

hardship to some 35,000 families this year?

Those 35,000 families, Mr. Chairman, are the people whose rents will go out of control if their rents go past that level.

That

was the estimate — by the end of this year 65 percent of all housing in

this province is going to be either beyond the controls or never in.

That's where we're at.

The minister's reply on March 17 was:

"There is no change in the government's policy on that topic from that

enunciated by my predecessor." I might say that your predecessor wasn't

a great person for announcing anything. He was great believer in "when

in doubt, mumble," and, boy, he did a lot of mumbling in the two years

that he was minister.

To carry on, he said:

May I say, in stating that, that in terms of a permanent and

satisfactory situation for renters and tenants in this province, it is our firm

belief that an expansion of supply of accommodation on the rental side as rapidly

as possible is the correct route to go.

Having said that, we are very mindful of the impact of rising

rents on tenants. The expanded rent provisions which we have brought in in recent

years reflect our effort to see the hardship or exceptionally difficult cases....

You're "mindful" of it. That's nice. Everybody is mindful of many things in this world. What are you going to do about it?

Let

me talk to you for a minute about rent review and the response from

apartment owners about the policy of rent review. We have used the

argument on our side and occasionally the government uses the same

argument when it's convenient. Houses built after 1974 are not subject

to control. That's to allow the investors to come in and not worry

about the fact that they're going to be in any way controlled. Those

people out there are now using the argument that rent review is almost

like being controlled. So those people who consider investing for one

minute are now saying: "Well, that's tantamount to including us in rent

control. We're not going to participate."

Where's the logic

of what you do? You allow the rents to be decontrolled, then your

answer to the problem that the renters face is to say that for anything

up to $700 and beyond the controls, you'll do rent review. What have

you done? You've scared off a few more investors. That's the negative

aspect of a piece of policy that wasn't necessary in the first place if

you'd have kept the rent controls on. At least the investors out there

that invest in housing would have said: "Well, the policy's the same.

We're a post-1974 house. We don't have to worry about it." Now they

are worried. They think that that's your first little inroad. That's

their

interpretation. You know, Mr. Minister. You're a lawyer and

you've been in business. You know how sensitive that market is. It's

worse than the stock-market. Everybody feels every little nuance of

policy change. That is a ridiculous policy change. You had the best of

everything when the levels were high enough that the tenants were happy

and the investors knew where they stood in respect of the rule that

nobody with accommodation built after January 1974 would have to worry.

But they are worrying about it.

You're "mindful." What are

you mindful of — all the problems? You get the mail and we get the

mail. Something has to be done. It's going to have to be done, frankly,

well before the winter sets in, because we are going to have some

horror stories. We have them now about people sleeping in tents. It's

happening. People sleeping in cars is not new. We know that on the side

you can say that it's because we have such a buoyant economy, but it's

not just because we have such a buoyant economy. It's because housing,

as a result of a lack of government policy over the last six years, has

not kept up with the needs that we've had in this province.

Consequently we've got this problem. It's the classical market

situation: too many people chasing too little accommodation, and the

accommodation going to those people who can pay the most money. We're

right in the middle of that right now.

We have at least two and perhaps three segments of our population that we have to concern ourselves with. We must

[ Page 5398 ]

concern

ourselves with the low-income and the fixed-income people. There's

another sub-bracket of the fixed-income people. Years ago when Mincome

came in there was a group of people on fixed incomes, but they were way

beyond & levels that we looked at when we looked at those people

who needed supplementary income. Those people were reasonably highly

paid civil servants. Now, because of inflation and the lack of an

adequate index, those people are now in the first and second categories.

Then

there is the other category, as I pointed out, of those people who are

spending an enormous amount of their money and who make reasonable

pay.... Young people who are trying to set out to build a family

are having to look at the business of paying.... We used to

consider when you paid $600 or $700 a month, that was mortgage

payments; that's a laugh now when you take a look at the kind of

mortgage payments people are paying.

We have to look at this

immediate problem of rents. We'll catalogue for the minister the horror

stories that have come out; he's probably got copies of some of the

dozens that we've got.

I ask the minister what the policy of

the government is with respect to rent controls. What can renters

expect down the road over the next two, three, four or five months? Not

18 months. Don't tell us about housing stock improvements. What is he

going to do about reimposing some of the rent controls? Never mind Dr.

Block and his Fraser Institute. His answer is: let the free market

system play as long as the government will subsidize the renters.

That's a new kind of cockamamey monetarism if I ever heard one. They're

monetarists on one hand, and then they argue that they want transfer

payments on the other. What's the policy of the government as of today

at 11 o'clock?

HON. MR. HYNDMAN: Mr. Chairman, may I

open by restating government policy on the topic, which I have restated

from time to time. With respect to rent control, the policy of the

government is very simple and very clear. The rent control system in

its present form shall continue. It shall not, as some have incorrectly

inferred, be taken down or dismantled. To do that would cause a very

severe economic hardship and dislocation. The existing rent control

policy stays.

Neither, however, for basically two reasons,

is it government policy to expand that rent control program. My friend

and I are going to disagree here. First, we believe that the expansion

of that program will very drastically curtail the production of new

rental accommodation, not just brand new construction but potential

accommodation being made available on the market for the first time. A

good example of that might be people normally being persuadable to

taking a single-family or duplex and expanding it to a three-plex,

fourplex or five-plex. Additionally, the member did not comment on one

of the very serious downsides of expanding controls. That is the

inevitable creation of black markets or key money. If you try to fly in

the face of the economics of supply and demand and you attempt to put

an artificial ceiling on a product in short supply, you run the very

serious risk of situations like under-the-table deals, black markets or

key money for accommodation.

The member did not stress the

companion piece to rent control which this government brought in: rent

review. He mentioned it; he didn't stress it. Again, I think my friend

and I are going to disagree on this. We happen to believe that the

companion piece to rent control, rent review, is a useful and fair

addition to the marketplace. We disagree. I do not hear the message

that prospective builders of rental accommodation are choosing not to

build because of the rent review provisions. In fact I'm a little

surprised to hear the member, on behalf of his party, argue so

vigorously against the rent review program.

Let me tell you — and it's no great fan of the government what the Vancouver Sun

had to say when the rent review approach of this government was brought

in. I think it's very useful to take a moment to comment on that,

because the Vancouver Sun , as it assessed the difficult issue

of whether you keep, expand or shut down rent controls, was aware of

the arguments on both sides. In response to the introduction of the

companion piece to rent controls — a rent review — on August 23, 1977,

the Vancouver Sun called it this: "...thoughtful, sensitive

legislation, keeping the government involved as protector where it

should be involved, getting it uninvolved where it should not be

involved, moving slowly so that the effects of change can be watched.

Nicely done." I think that there is a place for rent review.

good friend opposite didn't mention the second companion piece to rent

control available in our legislation, which this government has been

prepared to utilize through the office of the rentalsman. It is

intended for the exceptional and unfortunate case of the very bad actor

— that very small percentage of landlords who chose to take advantage

of a difficult situation by practising a pattern of conduct which is,

at once, outrageous and in conflict with all of the intent and spirit

of the Residential Tenancy Act. There are provisions whereby the office

of the rentalsman can conduct investigations and prosecutions. As the

member well knows, several of those have taken place in the last year.

I can tell the member that several more are under investigation. In

addition to the rent-review provisions which apply to non-controlled

units for the cases of gouging and exorbitant increases, there is the

further mechanism of the investigation and prosecution possibility,

which we are prepared to use and have been prepared to use in the case

of the very bad apple in the barrel — the very unrepresentative

landlord and the very small percentage of landlords who will try to

take maximum and unconscionable advantage of a difficult situation.

That

is the policy restated. It's very simple and very clear. I'm interested

to hear the member's comments, because I take it that he's advancing a

clear policy statement on behalf of members opposite. I hope he will

reconfirm that they are indeed in favour of an expansion of rent

controls. I think that should be noted. I hope the member will

reconfirm it. I've been listening this morning, and I do believe that

the member for Maillardville-Coquitlam (Mr. Levi), on behalf of the

official opposition, is clearly repeating what is apparently today's

opposition policy — to expand rent controls and the rent control

system. As I hear him — if I heard him — he would like rent review

taken away and rent controls expanded. I think that if he has a chance

to further reconfirm that, he should.

I think I should read

in its entirety the advertisement to which he referred. It's been

debated in this place before. I will read the entire copy of the

December 1975 advertisement referred to, because this government has

kept its word, in terms of that advertisement. That debate has taken

place in this chamber before. Just to refresh the member's memory, the

advertisement is headed: "Social Credit Will Not Abolish Rent

Controls." It goes on to read: "Any removal of rent

[ Page

5399 ]

controls at this time would only create a chaotic

housing situation. Social Credit is committed to keeping the present

legislation which limits the extent of rent increases." That's the full

text of the statement on rent controls.

The rent-control

system has been maintained, and rent review has been added. Since the

member opposite has taken us back in history, I'm reminded that members

might enjoy hearing what the Attorney-General of the day had to say

about the rent-control mechanism when his government brought it in. In

debates in the House in November 1974, the second member for Vancouver

East (Mr. Macdonald), then the Attorney-General, had this to say about

the rent control mechanism of the NDP. He called it "an interim little

measure" that was to be "tentative and interim." I presume he was

attempting at that time to mollify the concerns of potential investors

in rental accommodation in British Columbia.

This morning

the member opposite does not seem to echo sentiments viewing the policy

as one that should be tentative and interim. It's interesting to see

the policy apparently changing on the other side. I do look forward to

the member reconfirming this expansion-of-rent-control,

take-down-rent-review approach to rental accommodation. Quite properly,

the member mentioned the kind of case that would concern us all — a

rent increase from $365 to $625 a month. He asked the question: "How do

you reply?" We say that if it's a non-controlled unit, the first place

of reply is under the rent-review procedure. Hopefully, those tenants

have applied under rent review for a review of that proposed increase.

terms of seniors and those on lower or fixed incomes, obviously we're

concerned about people in those categories who are feeling the brunt

economically of a tight rental situation. I think it's fair to say, on

the income- supplement side, the member did not mention several of the

programs which this government has introduced and which have been

expanded in the last year to assist people so affected. I refer to the

provisions of the SAFER program, the provisions of the GAIN program and

the provisions of the Rentaid program. Those are also companion pieces

on the affordability or purchasing power side, designed specifically to

target in on tenants in those categories, to assist them.

think the member, quite correctly, did highlight a further difference

between he and I on this question, and that is over whether or not

supply can be an early and meaningful answer to tenants in British

Columbia. If I have been understanding correctly what the member is

saying, he is saying that for all the government says about supply,

supply, supply as being the only permanent and helpful answer to

tenants.... I would repeat our view that the only meaningful and

permanent security for tenants can be such a reasonable vacancy rate

that we have landlords competing for tenants as a result of an adequate

supply of accommodation.

We happen to think that our policy

of encouraging supply is working. Let me just quote for the member the

latest figures from last week as to what's happening in this province

in housing and rental construction. Let's bear in mind that this is in

spite of the impact of the CUPE strike on building permits and the

three- to five-month time-frame delay that that will cause. But once

again, British Columbia is reaching new and record levels of

accommodation construction. The Vancouver Sun of Saturday evening had a commentary and some quotes on the latest CMHC figures. I'll quote from the article:

"Meanwhile, CMHC is predicting that the number of new starts

in B.C. this year should rise about 8,000 units over the record level of 1976,

to hit 45,000. 'This number is simply unprecedented, and shows the economic

strength of the province' said Keith Tapping, the corporation's B.C.

manager.

"CMHC figures show that the 9,600 units started in B.C.

in the first three months were up 24 percent over the same quarter of 1980.

That is about one-third of the Canadian total, and 600 more than Ontario and

Quebec combined."

So,

Mr. Member, I have to say to you that I think that the production of

accommodation in this province, now projected at the 45,000 unit level

in this province this year, a level of production in the first three

months of the year 600 greater than Ontario and Quebec combined, does

show that policies to encourage investment in housing construction are

working. Mr. Member, I think you probably know the track record during

your party's term in government and what happened to construction when

you brought in your very heavy-handed rent-control system. In just one

year apartment construction in this province fell drastically — by a

third.

Interjection.

HON. MR. HYNDMAN: They're CMHC figures, Mr. Member.

That

is the historical track record of the consequence of investment

choosing not to get involved in housing and rental accommodation in

this province if it is faced with a heavy-handed program of rent

controls. I think we have the differences in approach outlined here.

The

member didn't dwell at length upon the recent major housing conference

in Ottawa sponsored by the Canadian Real Estate Association, attended

by many groups from all sectors including tenant groups. I think it's

fair to say that the general commentary on that conference — which was

in December — and the general theme of participants was in the

direction that controls and expanded controls were not the answer.

The

member mentioned the question of a 78 percent rent increase for tenants

on, I believe, Chilco Street in Vancouver Centre. I've heard from his

seat mates about that, and I've written them back. That is a

non-controlled, non-review unit, and I have no hesitation in saving to

you that in the absence of the most exceptional circumstances, any

landlord in this province who's promoting a 78 percent rent increase is

promoting a point of view that is unconscionable. It's exorbitant, and

we're going to investigate it. We're not going to sit idly back and let

that apparent type of gouging continue. Unless there is some remarkable

and unique explanation for that kind of a rent increase, we certainly

propose to look at it.

I think I have touched on he major points of view mentioned by my friend, and I'll be happy to listen further.

MR. LEVI:

First of all, let me say to the minister that no conference held

nationally has ever solved anything. So let him not invest too much

faith in the fact that the housing conference that went on in March is

going to produce anything except a lot of hot air, because the minister

himself — Mr. Cosgrove, who is the federal minister — has no clout

whatsoever. Talking about a S500 million transfer payment! This is the

free enterprise systems answer to the housing problem.

[ Page 5400 ]

Let's

deal with what the minister said in respect to housing starts here. Who

of the people who are suffering from rent gouging and the inability to

meet the kind of rents they have to pay are going to benefit from one

house that's built in this province? When you start at $150,000 to

$200,000 for a house and when you've got to carry mortgages for which

you must have an income of $40,000 to $45,000 a year....

You're

offering that as a solution to somebody who can't afford to pay $300 or

$400 a month. That's absolute nonsense. That's your answer for supply

to these people? That's the most ludicrous statement I've ever heard.

are talking about an immediate need for a piece of social policy that

that government can do with respect to guarding people's income. We're

not talking about supply. Supply, indeed. We've come to a sorry state

in this country when a couple starting out, doing well, who want to

have children and are both working, making $30,000, $35,000 and $40,000

a year between them can no longer be considered for a mortgage. That's

the state of affairs in your free enterprise system. And you offer that

as a solution to somebody on a fixed income — that somehow, because you

build more housing, it's going to make it okay for them. That's

nonsense. You didn't quote from Saturday's newspaper, which showed you

the large number of houses that they can't sell. There are literally

hundreds of houses in the greater Vancouver area that cannot be sold

because they can't find people who can afford to pay for them. That's

what you call a companion policy?

Last year I said to your

predecessor: "You have all these post-1974 units that are in the

decontrolled area. They've never been controlled. You should be setting

some kind of level, because they're starting to get out of hand." I

suggested, on the basis of the rentalsman's figures, that they should

be within in the order of $450 to $550. Do you know what his answer

was? "Well, we looked at that, but we were thinking more of $1,000."

Rent

review. Yes, we'll have rent review; but I can tell you, Mr. Minister,

that there would have been no need for rent review if you had done

something about leaving the rent controls alone and setting some

levels, as we recommended last year in terms of that housing that was

never decontrolled. That's a piece of social policy. That's what you

could have done.

Now you've got yourself into another kind

of bind. None of the answers that you gave represent any indication of

any kind of commitment to policy at all. You have no control. You have

not injected yourself into the housing situation. When we brought in

rent controls we had a Ministry of Housing; we had somebody who was

building housing. In 1975-76 there were 3,500 condominiums that were

empty, waiting for people to buy them.

MR. SEGARTY: Everybody was leaving the province.

MR. LEVI:

Oh, here we go again: "Everybody was leaving the province and now,

because of the great prosperity, they're all coming back." Oh, you

don't have very many people with you there.

Mr. Chairman,

the minister quietly tells us his economic dogma, and what is it? More

housing will eventually help those people who are taking large portions

of their food money to pay their rents. It's incredible that in this

country....

Interjections.

MR. LEVI: Will you throw that bum out of here? If you want to speak, get up when you get the floor.

Mr.

Chairman, we don't want the minister to stand there and give his broad

brush strokes about what he sees as the ultimate solution — rent

review. Do you think, Mr. Minister, that when the people who were

served with a notice that their rent went from $350 to $625...that

rent review works like that? When you get a notice like that, you've

got to make a decision. You can put in your rent-review thing if you

want, but it takes two or three months to come down the road. By that

time, if the review if not allowed on behalf of the tenant, the

individual has to pay all the money, which he can't pay — that's one of

the reasons why he's complaining in the first place — so don't tell us

that that's a solution. You can't take hundreds and thousands of

individual cases and somehow argue that the staff can deal with each

individual one; you've got to have some kind of policy which people can

look to in terms of a framework.

Nobody wants to see

permanent rent control, but you have a crisis situation. This is a

situation you people created. They created it; they started to tinker

with it. You never did anything about rent controls. The first thing

you did when you came in was to take it from 10 to 7, and that shifted

the balance in favour of the apartment owners. Then you started to

creep back up again. You've got to have a policy, something specific.

Don't tell us that your attitude or policy is the business of finding

more accommodation. We don't want to get into that one now; we get into

that under the Housing minister. That's not an answer to the problems

that that minister knows are happening out there.

That's

what it is: rent controls. Sure, the idea was, when they were first

brought in, that they would be part of a broad approach to dealing with

a combination. The previous government had a multiplicity of programs.

They did something about social housing. They did something about the

nonprofit operation. They did something about Crown land. Those are all

part and parcel. You haven't had that policy. You've had a little

addition every two or three years, whichever way you go, up or down.

You're the only minister in that government who's ever strung three or

four words together that has meant anything in terms of approach, when

you did it yesterday with the scanners. The scanners is an important

issue, but in terms of priorities, there is a more important issue than

the scanner.

Nothing that you have said has in any way

offered anybody out there any kind of hope that six months from now

those people who may be among that group that can afford to pay the

rent that they've got, based on their income, will not be looking at

the prospect that they're going to enter the category of the poverty

line. You know about the poverty line, Mr. Chairman. The poverty line

has been established by definition in this country. It's a reasonable

definition. If you pay 70 percent of your income on housing and food,

you're on the poverty line. The poverty figures issued recently by the

Council on Social Development are of the order of $14,000 for a family

of four. If you have less than $14,000 per year for a family of four

you are classified as being at the poverty level because you are

spending 70 percent or in excess of 70 percent on the two basic

functions in our lives. The goal which was stated many many times — if

it's not their goal over there, it's certainly an objective that we've

had in mind — is that no one should have to spend more than 25

[ Page 5401 ]

percent

of their income on accommodation, not with the increased inflation and

not with the ever-increasing food prices. That's the situation we're in

today.

Now we have the other, almost ridiculous problem in

terms of the system, when in order to qualify for a mortgage today, if

you can't demonstrate to the bank that your income is $45,000 you don't

qualify for a mortgage. Every member of this House, if he had to go to

the bank, given his income, would not qualify. He'd have to be a

cabinet minister to qualify. That's the ridiculous situation that you

have in this free enterprise system. On the one hand you have the banks

that make money every time that announcement comes out of the Bank of

Canada on Thursday that the interest rates are up. They are slow to

rebate back to people when a thing goes down or up. We've had that

argument already. That's something we have to deal with.

I said earlier, you then have the Bank of British Columbia. It must be

embarrassing to announce that your net profit for the three months is

300 percent more than it was in the first three months of 1980. That's

directly related to the pressures of inflation and the changes in

rates, particularly mortgage rates. There is no sense of responsibility

at all from the banks in respect to how you deal with the problem. The

minister hasn't touched on that. He had a conference a few weeks ago.

Seventy people showed up. They had a nice little back-scratching, but

nothing has come out of it. The minister talked about all the little

companion things that they were doing. Why don't you mention the

mortgage subsidy program? For the first time you took a tentative

tippy-toe into the public area and decided that the government had a

role to play. So he played it. For a cost of approximately $9.5 million

to $10 million, you levered $200 million to mortgages and created about

5,300 homes. That's what happened. According to the figures I now have,

there were some 2,200 homes and the balance was in multi-unit dwellings.

You

want to talk about some influence on the provision? That had some

influence. Mind you, there were some very serious problems from that in

respect to whether first-time home buyers got them or not. My

information is that the majority of people getting the advantage of

that program were not first-time buyers. But the principle of the

program was worthwhile. If you can take $9 million to $10 million of

government money and lever, that's a worthwhile project. If you can

take $90 million to $100 million, then you would lever in the order of

$2 billion. That would start to really dig in to the needs of housing

which would have some direct effect down the road when you build

sufficient accommodation and when you talk about employing people and

interesting the forest companies who are having such a bad time with

the export market these days.

There's no comprehensive plan.

We're back to the basic issue. Nothing that the minister has said has

answered in any way the criticism that I've made on the failure to have

a policy, particularly in respect to doing something about reimposing

rent controls now at levels that people can deal with. You can put them

on and you can take them off. But you put them on in the face of the

reality of the situation. You took them off in the face of the

unreality of the situation when you said — not you, the two former

Ministers of Consumer and Corporate Affairs, both of whom went the way

of the former Minister of Health, who went to the hotlines....

Without any basis of fact they said: "We think we can do it now,

because we've proved our point." You've proved nothing. Today you're in

a worse situation.

Mr. Minister, we're not talking about

provision of rental accommodation. We're talking about the kind of

pressure that your rentalsman's office is under. Don't kid yourself

that people don't burn out, because they do. Enormous pressures exist

on that agency. It’s not a question that you can do frontline fieldwork

and somehow that's going to bail the government out, because it's not.

The problems are too numerous. There is no indication from that

government how you are going to offset some of the problems down the

road, six months from now.

Let's stay with the immediate

problems of the renters. We've debated for years whether people will

invest or not invest. You offer a typical free enterprise system

solution. That's been going on for 15 years. For 16 years you've had

free enterprise governments in Ottawa. For a short while the minister's

former party was in there. They didn't offer any solutions. Don't tell

us about your system and what the federal government can do. We're

talking about a real problem of today. Nothing that you've said today

is going to give any renter out there any feeling that they'll know

what's going to happen to them six months from now.

I can

only presume that that group of people.... You can say: "Let them

sleep in the streets. They're not around, they're not registered, they

won't vote for us; what the heck!" There's a complete indifference to

this problem by the government. If you think that there isn't something

that you can do by looking at the levels of rent controls.... That

gives people time, and that's what they need. You say that you need

time to build your housing. They need time so they can live and not be

under constant pressure of being turfed out because they can't afford

the rent. That's what we're talking about.

Nothing that

you've said gives any comfort at all to those people. That's not

ministerial policy; that's a lot of waffling, which has been the

keynote of that government's policy in respect to rent control. The

government — particularly that minister today — has completely failed

to answer any of the real problems that those people have. Don't tell

us that we're in favour of perpetual rent controls. That's not the

case. Don't tell us that we're against rent review. If you had done the

thing property, you wouldn't have needed rent review. Your predecessor

didn't know which end was up; it was an incredible situation. You do.

You've been in the business community; you know what it's all about.

But nothing you've said is going to make one tenant in this province

sleep any easier tonight than they did last night. In that area you've

completely failed in terms of a policy proposal.

MR. BARNES:

Mr. Chairman, I want to say this much for the minister: he certainly

has given the appearance of being concerned. This is his first defence

of his ministry, and as usual he is well rehearsed and articulate in

expressing his views.

However, he was quoting statements from the Vancouver Sun

that indicate there is some support for the position he is taking with

respect to construction of housing in the province. These have been

referred to by way of rebuttal by my colleague the member for

Maillardville-Coquitlam (Mr. Levi). But also in the Vancouver Sun on

April 22 there was an

article which said the West End is quite likely

to become the preserve of the rich. That's one of the concerns I have,

along with the first member for Vancouver Centre (Mr. Lauk), as the

West End is a residential area, in part, in the constituency of

Vancouver Centre. The situation is indeed a grave one, and

[ Page 5402 ]

one

that I'm afraid the government is simply not equipped to deal with —

basically because of dogmatic, philosophic differences with the reality

of the times,

You will recall that about ten years ago, when

the interim rent stabilization act was introduced by the former

Attorney-General, the second member for Vancouver East (Mr. Macdonald),

there was a reason for calling it an interim rent stabilization act. It

was a device used to interfere with what appeared to be a deliberate

conspiracy to take over the West End as a stable community of ordinary

citizens who had, in fact, been living there for generations. Clearly

the government had a duty and responsibility to respond to this

emergency situation. At the time, the Non-Partisan Association — the NPA

civic council — was in office in Vancouver; I believe the mayor at that

time was Tom Campbell. It's no secret that the West End has always been

a sort of coveted piece of real estate with respect to speculators. It

has been viewed internationally, certainly throughout North America, as

an ideal place, a sort of pinnacle for those people who have

successfully achieved just about everything in life, except their own

Disneyland on the coast of British Columbia. The West End has always

been subject to that kind of consideration as an ideal stronghold for

the rich. That's basically the story that I'm discussing with respect

to this issue.

I've had many years to become familiar with

the people who live in the West End and with the institutions — the

professional services and the social amenities — and the general

texture and demographic mix that has existed there for a long time.

There used to be more public schools than there are today, and there

were more extended families in evidence. Little by little the West End

is losing its character. This is a concern as well.

We have

to take this debate and put it into perspective. We are looking at a

community of individuals who have existed peacefully for generations,

who are now becoming subject to displacement. They are really being

challenged with respect to their right to continue residence in this

so-called high value area. There are many people who would like to take

over and create a private luxury community for themselves and for those

who could afford to live there. I think this is unfair. It's certainly

unjust. In our society, we as people who believe injustice and the

right of all citizens to live in a mixed atmosphere and an atmosphere

which reflects our interest in the different cultures, interests,

lifestyles and socio-economic situations.... What I'm asking

basically is why the West End, as an example, should be subjected to

the invasion by speculators and politicians with very little respect

for public morality and a gross disrespect for those persons who have

lived in and built these communities. The senior citizens who once had

their own homes in the West End are now forced to sell their homes

because of high taxes. Because of lack of control over the stability of

the community and the heritage that has existed they're having to live

in some of the larger structures such as Sunset Towers and others which

are certainly superior to some facilities that are available to them as

alternatives. They are slowly being displaced because of neglect, lack

of respect for their right to exist in dignity and the inability of

politicians to consider social factors as well as economic and to be

free of dogmatic, rigid attitudes with respect to what's good for the

community. I don't think that the public cares if the programs that

assist them are free enterprise programs or socialist programs, as long

as they are functional and will assist them to be able to live in

dignity and with respect.

It's quite clear to me that there

is evidence of some kind of conspiracy with respect to what is

happening to tenants — specifically people in residential facilities.

There seems to be a disregard for these people who, quite clearly, are

the majority of the population. Most people probably, one way or

another, have to pay rent. We've commented on those who cannot even

afford to get a mortgage under the current economic situation. They

have no other option but to pay rent. To allow an open market situation

to exist in one of the most densely populated communities in North

America and perhaps in the world, with no protection whatsoever for the

present demographic mix.... The present structure that exists there

is tantamount to permitting military troops to invade the shores,

occupy the territory and say: "There's nothing we can do. This is free

enterprise, and we can't interfere in the marketplace." This is exactly

what's happening, little by little. The evidence is overwhelming, and

it's really quite shocking to me. There are so many things wrong with

what is happening as a result of this government's inconsistency and

political considerations that it has not stopped to think of its social

obligations, or perhaps it doesn't believe these are important.

Let's

just consider — the West End is, I think, a microcosm of the issue

right across British Columbia, but it's a perfect example. The

government has made announcements of major projects that will

obliterate that community without any consultation or reference to the

community in terms of the impact it will have — not just environmental,

but the impact on lifestyles, on the integrity of the community and the

ability of the community to support all these intrusions, without

reference to the ability of the community to continue to exist. A

convention centre may be great for those people who want to have an

infusion of capital so they can benefit from the results of tourism and

so forth, and I'm all in favour of that. But there was no reference to

the people directly affected by it. There was no serious consideration

of alternatives with respect to Pier B-C, for example. It's the same

thing with the stadium — the amphitheatre. It's going to have a major

impact on the community, and things will never be the same in the West

End. Some may say: "So what? Maybe it's going to be for the better."

But I would suggest that if you really care about communities in this

province — and we are a huge province — we don't have to focus

everything in one area and destroy the one good community we have

because of short-sighted, expedient measures that may have political

value for the moment but in the long run will give the appearance of

our being totally disorganized and with no order or sense of direction

whatsoever in what we're attempting to do.

These are the

kinds of things that concern me: the concept of Transpo '86 and how

that will pour more and more traffic into the downtown and West End

area. There's no question in my mind that there is a conspiracy

underway. I believe that the Social Credit government is playing a

major

part in this. In the past it has been the NPA council in

Vancouver and other people who are indifferent with respect to the

existing community and the integrity of the existing community. Had

they been really concerned, I'm sure there would have been some serious

effort to involve the people who are going to be affected in what these

decisions would ultimately mean to their existence in that area.

Earlier,

the minister suggested that he was going to hold a public hearing on

the closing of the liquor store on Hastings and Main as a result of

certain uncomplimentary problems

[ Page 5403 ]

with

respect to that community by people who are buying spirits there. That

may be a good idea and it may not. In this particular instance,

apparently the city council has already voted to close the store. There

are some 4,000 out of 7,000 people who have signed the petition to that

effect. I question the sincerity of the minister in suggesting that he

wants to hold a public hearing on the matter. However, I must commend

him on his interest in concerning himself with public opinion on a

matter such as closing a liquor store, which is one of the main sources

of revenue for this government — and very inferior quality at that, I

understand, except that it's a captive set of consumers in that area

who are probably spending their last dollars to maintain habits,

because they have no other place to go and nothing else they can do in

that depressed area.

Why is it that the minister sees fit to

arrange a public hearing on the matter of closing a liquor store but

cannot see any value in calling a public hearing with respect to the

kind of intrusions that have taken place in the West End with respect

to government announcements? It's like the Premier in one of his

visions who wakes up one morning and decides he wants to have a

downtown British Columbia called B.C. Place. He goes out and makes an

announcement, gives everybody breakfast and then finds out that he's

got to go out, acquire the land and make the arrangements — after the

fact. I don't recall any reference to the community with respect to

that project.

The first thing he says he's going to do under

top priority will be to put up the stadium. There is supposed to be

housing as well on that site, but I haven't heard a single word with

respect to constructing the housing. Here we are with a major emergency

— an urgent and critical situation in the province of British Columbia

— and the most important thing the government can think of is to build

a stadium for free enterprise at public expense. It's absolutely

incredible, the thinking of the government. So I'm not impressed that

the government is sincere on this matter, Mr. Chairman, when it comes,

to the question of rent controls.

The interim rent

stabilization act brought in by the New Democratic Party in their first

year of office was just that. I predicted and said all along that

exponentially, if you left anything at a set figure such as 8 percent

or 10 percent, in seven years or so it would be inflationary, it would

double, and that's exactly what has happened. But we were in the

process of making those changes and considering rent review systems

that were relevant and made sense, not the kind of system that

presently exists. You have to rationalize the costs of construction,

and you should be responsible enough and willing to bring forward your

true costs. What is happening is that we have for convenience set the

rent control at a certain figure and left it there. That is something

that has always been a problem. I've always said, from day one, that

any figure that is irrational, static and set as a sort of inflationary

figure for convenience is going to hurt some people, and obviously this

has been a critical problem with rent controls.

But rather

than getting rid of rent controls, they should be made to apply to the

situations at hand. Landlords are taking advantage of it by annually

raising their rents 8 or 10 percent, whether they need it or not. Some

of them should only raise in 3 or 4 percent; some of them have

completely different situations than others. It is not the same from

one accommodation to the next, Mr. Chairman, and that should be

rectified. But with respect to the subterfuge that the government is

using in removing rent controls, the minister stands and says that the

policy that is presently in place will remain. In other words, he has

no desire or plan to change what is happening.

The

predecessor of the present Minister of Health, Mr. Rafe Mair, had this

portfolio, and he deliberately set out to undermine rent controls

through a system of allowing large numbers of housing units to be

removed from the system after they reached a certain level of rent.

That, in effect, meant that in time, predictably, there would be no

rent controls. Yet the government could politically say that it was not

removing rent controls. I think that that's what Mr. Bennett had in

mind in 1975 when we tried to warn the voters that he was going to

remove rent controls. He took out a full-page ad in all of the major

papers that said: "No, we're not going to remove rent controls; rent

controls stay." What he didn't say was that they were going to arrange

it so that rent controls could be diluted and undermined. That's

exactly what's happening today.

I can tell you that most

people who are complaining are not people on marginal incomes. People

are complaining who are paying $1,000 a month for their apartments.

They are earning $15,000, $20,000 or $25,000 annually and would

normally consider themselves to be quite capable of living well, paying

25 or 30 percent of their earnings on rents. So this is not a case of

just helping those people who are supposedly unable to fend for

themselves and just need a little social handout, a rent subsidy or

some kind of special aid. We're probably talking about 80 percent of

tenants. We're talking about most people, because very few people are

benefiting from rent controls now.

Rent controls apply to

very few units. Next year it will be even less, and the year after that

even less. Remember that it restricted itself in the first place to

those units constructed before 1974. So it was never 100 percent

coverage in the first place. There have always been restrictions.

controls and limitations on the full impact of rent controls.

While

the minister says that he is concerned about inflation and wants to

allow owners of rental accommodation to recover their losses with

respect to increased mortgage rates and so forth, why doesn't he have

the same concern about protecting affordable housing that is within the

category presently under controls? In other words, instead of leaving

it at $350 or $400 before it is free of controls, why not raise it to

$700, $800 or $1,000 and put all those rents of $1,000 or under within

controls? Really, that's marginal now. Those are poor persons rates.

Those rates are paid by most people today who last year were paying

$300 and $400. We'll get into that this afternoon. I'll bring some

examples and show you how much people are paying. People who a year ago

were paying $300 are now paying $1,000 to $1,200. It's really a very

sad and serious problem.

I notice that the House Leader

(Hon. Mr. Gardom) is asking, in view of the time, that perhaps the

committee rise, report progress and ask leave to sit again. I so move,

but I hope that I will have an opportunity to hear the minister's

response later on in the afternoon.

The House resumed; Mr. Speaker in the chair.

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

Hon. Mr. Gardom moved adjournment of the House.

Motion approved.

The House adjourned at 12:02 p.m.

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