British Columbia Hansard — Tuesday, May 5, 1981 — Afternoon Sitting (32nd Parliament, 3rd Session)

32p 03s 810505p

British Columbia — Debates (Hansard)

British Columbia Hansard — Tuesday, May 5, 1981 — Afternoon Sitting (32nd Parliament, 3rd Session)

32p 03s 810505p

British Columbia — Debates (Hansard)

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

Afternoon Sitting

[ Page

5405 ]

CONTENTS

Routine Proceedings

Oral Questions

Hospital bed shortage. Mr. Cocke –– 5405

Mr. Hanson –– 5405

Mr. Lauk –– 5405

Mr. Stupich –– 5406

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

Hyndman)

On vote 44: minister's office –– 5408

Hon. Mr. Hyndman

Division on vote 44

On vote 45: executive and administration –– 5410

Mr. Levi

On the amendment to vote 45 –– 5410

Mr. Levi

Division on vote 45

On vote 46: consumer affairs –– 5411

Ms. Brown

Mrs. Wallace

Mr. Levi

Mr. Mitchell

On the amendment to vote 46 –– 5415

Mr. Levi

Division on the amendment

On vote 46: consumer affairs –– 5416

Mr. Howard

On vote 47: corporate affairs –– 5416

Mr. Levi

Mr. Passarell

Mr. Mitchell

On the amendment to vote 47 –– 5427

Mr. Levi

Division on the amendment

TUESDAY, MAY 5, 1981

The House met at 2 p.m.

Prayers.

MR. HOWARD: Visiting us in the

gallery are a number of students from Mount Elizabeth Secondary School

in Kitimat. Michelle Reguish, Marta Furtado, Sheila Monti, Sharon

Urbanowski, David Powell, Jenny Godfrey, Janine Monti, John Froess and

Michelle Marlowe are here along with the president of the student

council of which they are members, Kim Meyer, and Mr. Gary Maitland,

their chaperone and teacher. I'd like the House to join me in welcoming

them.

In addition, we have visiting us today, as we had

yesterday, three members of the district municipality of Kitimat,

aldermen Joanne Monaghan, Ramon Brady and Hans Brown. They are in the

precincts, and I would ask the House to join me in welcoming them.

MR. BARNES:

In the gallery this afternoon is Mr. Paul Gill, first vice-president of

the B.C. Young New Democrats. Accompanying him is a student at the

University of Washington and a member of the Socialist Party of the

United States, Mr. Dave Fathi.

There are also students from

Mount Pleasant Elementary School, along with their principal, Mrs. Lee

Hasfft and two instructors, John Zappavigna and Ectore Rossi. I'd like

to ask the House to make them welcome.

MR. NICOLSON:

I notice that we have in the public gallery the driving force behind

the Valhalla Park proposal. On behalf of myself and the Minister of

Lands, Parks and Housing (Hon. Mr. Chabot), I wish to welcome Colleen

McCrory to the House.

Oral Questions

HOSPITAL BED SHORTAGE

MR. COCKE:

Mr. Speaker, I have a question for the Minister of Health. Can he

confirm that in March of this year 64 hospitals in B.C. had over 1,200

long-term care patients occupying acute-care beds?

HON. MR. NIELSEN: No, I can't confirm that. The number may be correct, but I don't have the precise figures.

MR. HANSON:

Yesterday the Minister of Health brilliantly deduced that the hospital

crisis in Victoria was created by too many patients and too little

accommodation. I want to point out to the Minister of Health that

urgent surgery is being cancelled in Victoria, and that more urgent

cases have been cancelled in the last four months than in the previous

12. What emergency action has the minister decided to take to alleviate

this crisis?

HON. MR. NIELSEN: I'm pleased to advise members of the House that

representatives of the two major hospitals and the regional district hospital

board agreed today in a meeting that indeed the problem is precisely as I stated

yesterday. The answers to the problem are much more complicated. The administrators,

members of the hospital boards and representatives of the regional district

met in my office about noon today. The technical people from the ministry, along

with people from the hospitals or boards, are probably continuing with their

meeting now to discuss the precise details of several aspects of delivery service

within the hospital program to see if they can alleviate some of the problems

which have been identified. The representatives from the hospitals offered their

appreciation that the problem cannot be precisely identified, that a great deal

more information must be known, and that the cost implications cannot be precisely

identified — although they had a reasonable estimate in a couple of areas.

The

representatives agreed as well that simple expansion of facilities by

way of new beds on stream may not alleviate the problem they have

identified. The approach being taken by the ministry staff and the

staff from the hospitals and the regional district will basically focus

upon admission and discharge procedures, some of the geriatric

activation programs, rehabilitation and home support services as

perhaps areas in which immediate relief or almost immediate relief

could be achieved. The new beds which are on stream or in the planning

stages probably would offer some relief, but very likely not in the

proportion one would anticipate simply by substituting a different type

of bed for those who are now in the acute hospital service.

the meeting today was most productive. The representatives explained

their position in quite precise terms to the best of their ability; the

ministry staff received the information and are now working with them

to determine if there can be any immediate relief given to the two

major hospitals in the Victoria area in an attempt to reduce the

waiting list for those who fall into the category particularly of

urgent surgery. That matter is being investigated at this moment, Mr.

Speaker.

MR. HANSON: On a supplementary, Mr. Speaker,

the crisis we're living with daily in Victoria is that long-term care

patients are occupying acute-care beds. There are beds scheduled to

come on line, but they're inadequate in number. Knowing that this

critical situation was coming up through his ministry — that it has

taken two years to bring the Oak Bay Manor renovations for 150

additional beds on line — will the minister meet with the contractors

and renegotiate an earlier completion date to help alleviate the

situation?

MR. SPEAKER: If the question was, "Has the minister met...?", it's in order.

MR. HANSON: My question is: has the minister decided to meet with the contractor?

MR. SPEAKER: That question is in order.

HON. MR. NIELSEN: No, I haven't, Mr. Speaker.

MR. HANSON: Why not, Mr. Minister?

HON. MR. NIELSEN:

Mr. Speaker, the reason I haven't is because we have very competent

people within the ministry who, I'm sure, would be able to meet with

the contractor, and that's what their occupation demands.

MR. LAUK: I have a question to the Minister of Health, Mr. Speaker. Can the minister confirm that in March there

[ Page 5406 ]

were

1,890 people on the waiting list for surgery at Vancouver General

Hospital, approximately 200 of them waiting for open-heart surgery?

HON. MR. NIELSEN:

Mr. Speaker, no, I can't confirm those figures. As I said previously,

they may be correct, but I don't have the file before me. I can

certainly find out.

MR. LAUK: I take it that the minister has undertaken to provide the answers to those questions. Is that what the minister has done?

HON. MR. NIELSEN: Is that your question?

MR. LAUK: I didn't understand the answer, Mr. Speaker. Did the minister say that he would bring the information to the Legislature?

HON. MR. NIELSEN: I'll speak when you sit.

MR. LAUK: Has the minister decided to take that question as notice and bring the information to the House?

HON. MR. NIELSEN:

Mr. Speaker, I will attempt to determine those figures as of March

1981, and when I get the information I'll be pleased to share it with

the House.

MR. STUPICH: Mr. Speaker, can the Minister

of Health confirm that in the month of March there was a three-month

waiting list at the Nanaimo Regional General Hospital for emergency

surgery?

HON. MR. NIELSEN: Mr. Speaker, no, I cannot confirm that, although the figure may be correct. I'd be pleased to look into it.

MR. STUPICH: Mr. Speaker, I just want to be clear that the Minister of Health has taken the question as notice.

HON. MR. NIELSEN:

Yes, Mr. Speaker, I'd be pleased to investigate the circumstances, as

the member for Nanaimo has requested. When the information is available

I'll be pleased to share it with the House.

MR. COCKE:

Mr. Speaker, can the Minister of Health confirm that in March there

were 1,406 people on the waiting list at the Royal Inland Hospital in

Kamloops?

HON. MR. NIELSEN: Mr. Speaker, I can't

confirm those numbers, but the member could be correct. I'd be pleased

to look into it, and when I get that information I will be most happy

to share it with the members of the House.

I might add that

the facilities available to a member in the House are inadequate to

have all one's files available at all times.

MR. COCKE:

Mr. Speaker, we've been doing a good deal of work in terms of finding

out, just for the minister, so that he knows what's going on in his

ministry.

I'd like to go on and ask whether the minister can

confirm that in March there were 1,400 patients on the waiting list for

elective surgery at the Surrey Memorial Hospital.

Mr. Speaker, I gather the minister isn't going to answer that question.

I have one more question for him. In view of the fact that the bed shortage

for acute care has reached the point of being a provincial emergency, can the

minister advise the House as to what immediate emergency action he has decided

to take to alleviate this crisis?

HON. MR. NIELSEN:

I'm not quite prepared to accept the phraseology of the member for New

Westminster that it's a provincial emergency. The waiting list

situation is not new to the province of British Columbia or any other

jurisdiction which has a reasonable health program. We have been

advised by specific regional districts, their hospital component,

specific municipalities and hospitals as to what they consider to be

their urgent requirements and needs.

I'm sure the member for

New Westminster will find this provincial emergency may be somewhat of

an overstatement. It is not considered lightly by the responsible

people in the Ministry of Health. To call it a provincial emergency....

I suppose that terminology could be used, depending on what you're

attempting to prove at the moment.

I can tell you that the

people responsible in the Ministry of Health are well aware of any

waiting lists for elective or urgent surgery. Attempts are being made

to alleviate this problem on a hospital-by-hospital basis or a regional

basis.

As the members would know, there's been an

accelerated program in the province over the last number of years for

new facilities, additions to existing facilities and new hospitals.

There's been a major expansion — intermediate care — to alleviate beds

within the acute-care system. We have a large inventory of beds

available to patients in the province. We are receiving an increased

population of 1,000 people a week on the average. Those who are

responsible for health-delivery care through hospital programs are

attempting to meet the situation by increasing budget and by responding

to local needs.

It's certainly an important area and one of

grave concern. As the member for New Westminster said, today suddenly

it's a provincial emergency, because of some compilation of figures

that the NDP have put together. I would say that today's situation is

as it has been for quite a period of time in this province. There are a

large number of programs which are active at the present time in an

attempt to alleviate it.

I might remind the members, Mr.

Speaker, that you do not build a hospital overnight, obviously. You do

not resolve those problems overnight. It takes a great deal of

long-term planning.

Interjections.

HON. MR. NIELSEN:

Members on the other side are yelling " six years." I wonder what their

hospital construction program was in the three years prior to the six

years.

AN HON. MEMBER: It was better than yours.

HON. MR. NIELSEN:

Oh, better. I see. We'll see. That's a matter of record. How many

long-term care facilities were introduced during your time in office

and how many beds were put on stream — not taken over and given a new

name, but actually constructed to alleviate this problem? A smirk is

hardly the way you respond to these situations in our province.

MR. SPEAKER: I remind the hon. minister that the purpose of question period is, first of all, to seek information

[ Page 5407 ]

via

a question, and then to give the answer as precisely and briefly as

possible. It is not the purpose of question period to enter into debate

or argument.

MR. COCKE: In his own area, I would like to point out that there was an increase....

AN HON. MEMBER: State your question.

MR. COCKE:

Question, my foot! Now they don't want to be embarrassed. My

preamble

is as follows: the university, 300 beds; Queens Park, 300 beds. There

has been a net loss during this government's period in office because

of the closure of private hospitals. What is that minister going to do

about it?

MR. LAUK: I have a question for the

Minister of Health. The Minister of Health took exception to the hon.

member for New Westminster's (Mr. Cocke'

s) use of the phrase

"provincial emergency." I ask the minister this: in view of the fact

that there are 1,400 patients on the waiting list for elective surgery

in Surrey Memorial Hospital, 1,890 at Vancouver General Hospital, 1,406

at Royal Inland Hospital in Kamloops and 433 waiting for urgent surgery

at Royal Jubilee Hospital, what would the minister call a provincial

emergency in health care in this province?

HON. MR. NIELSEN:

By way of

preamble, which apparently is permitted, an emergency, within

the context of the medical services programs, has a very specific

meaning, I think.

Those who would prey upon the fears of people awaiting elective surgery for purposes of by-elections, or whatever....

Interjections.

HON. MR. NIELSEN:

Mr. Speaker, I think the members should appreciate that those who are

engaged in the delivery of health services in this province are

generally very professional in their attitudes, whether they be at the

hospital level, the regional district level or within the ministry.

These problems which are identified have been under consideration for a

very long period of time.

MR. KING: Too long.

HON. MR. NIELSEN: Too long, sure.

suggest that suddenly there is a provincial emergency is ridiculous,

because a great deal has been done. As the members may or may not know,

the hospitals have a very important role in all of these aspects, as do

the regional districts. We have member after member today

coincidentally asking the same question, yet we have not had this type

of urgency expressed by people who are responsible for the delivery of

health in the province.

MR. BARBER: Ask the doctors here.

HON. MR. NIELSEN:

Well, Charlie obviously wasn't in the House when I answered the

question with respect to the Victoria situation — which is not unusual.

As I explained earlier, the Victoria situation has been considered in

some detail today, and I believe officials within the ministry and the

hospitals are still discussing it at this moment.

MR. BARRETT: It's a stall.

HON. MR. NIELSEN: It's not a stall! Don't point your finger at me.

The

problems which have been specifically identified by representatives of

the Royal Jubilee Hospital and Victoria General Hospital have been

taken into consideration by representatives within the ministry's

hospital programs division. What I guess the members are unaware of

today — and there is no way they could be aware — is that the meeting

we had in my office was very productive. Those who were in attendance

today felt that some of the suggestions put forward could go a long way

to alleviating the immediate problem which has been identified. The

long-term solutions are quite different, and will require a

considerable amount of study, as they agree. The member for Victoria

earlier spoke about possibly accelerating the Oak Bay Manor, and 150

beds. We have 336 intermediate-care beds, I believe, which are coming

on stream this year, along with approximately 200 on stream for early

spring next year. In addition, there are a couple of hundred

extended-care beds which are on stream in the greater Victoria area....

MR. HANSON: It doesn't meet the need.

HON. MR. NIELSEN:

To meet the need, Mr. Speaker, is an entirely different question,

because we have not been able to have any of these officials agree as

to what that precise need is in numbers of beds. Whether the problem

can be alleviated simply by producing more intermediate-care or

extended-care beds is not agreed to by the officials who are

responsible in that area. It's a very complicated situation, I'll

agree, and a great deal of effort, work and money is being spent in an

attempt to alleviate the problem. But that will not eliminate the

problem of waiting lists for elective surgery, nor do I believe that

anyone in the health profession believes that indeed it will eliminate

the elective surgery lists.

MR. SPEAKER: Hon.

members, perhaps a guideline which could be considered by the members

for question period would be that if a question is of a nature which

inquires into the past action of a minister and would require longer

than a minute or a minute-and-a-half to disclose, perhaps that question

would be better put on the order paper and filed as an answer.

HON. MR. CURTIS: Mr. Speaker, I ask leave to make introductions.

Leave granted.

HON. MR. CURTIS:

Mr. Speaker, as members will know, a one-day meeting commenced this

morning of western Finance ministers. Seated on the floor of the House

at this time are two of my three colleagues from the western provinces:

Hon. Lou Hyndman, Provincial Treasurer for the province of Alberta, and

Hon. Brian Ransom, Minister of Finance for the province of Manitoba.

is to be regretted, Mr. Speaker, that Hon. Ed Tchorzewski, the Minister

of Finance for Saskatchewan, has had to leave the city in order to keep

an appointment in his home province. However, he participated in our

discussions this morning and through lunch. If I may mention it

briefly, a rather unusual circumstance in a Canadian legislative assem-

[ Page 5408 ]

bly

is seen today, with a minister of the Crown in British Columbia and a

minister of the Crown in Alberta who are brothers, and that must be a

very proud moment for the two members.

MR. COCKE: Mr.

Speaker, under the circumstances, I rise under the provisions of

standing order 35 to request leave to move adjournment of the House to

debate a matter of urgent public importance.

There is an

atmosphere of crisis throughout the healthcare system of B.C. today.

Nowhere is this more obvious than in our hospital system. It has taken

many years of neglect, failure to plan adequately and outright refusal

to provide assistance, but the government has now created a situation

in which people with urgent medical problems stand a chance of not

having hospital facilities at their disposal. The situation in B.C.

today is completely unprecedented since the introduction of modern

medicine in the province. Certainly there is no precedent to the

present situation, in the period since the establishment of universal

medicare and hospital insurance in the late sixties.

The

situation in B.C. is clearly out of hand. Throughout the province we

have long-term care patients improperly occupying acute-care beds. We

have extensive waiting lists for surgery of all kinds, and we have a

growing number of incidents where urgent or emergency cases are turned

away from our hospitals because of lack of availability of beds.

Incredibly, the Minister of Health (Hon. Mr. Nielsen) is quoted in the

media today as having said: "I have no idea whether the situation in

the two Victoria hospitals is as bad as described by hospital

officials." The minister has no idea what goes on in his portfolio.

The

official opposition does have an idea of what's going on in the

hospital system. I'd like to give the minister a few steps which can be

considered by Mr. Speaker in assessing the urgency of the debate. In

March of this year 1,400 patients were on the waiting list for elective

surgery at Surrey. The wait can be up to seven months in duration. At

St. Mary's in New Westminster there are 700 to 800 on the waiting list

for surgery. At Vancouver General there are 1,890 patients awaiting

elective surgery. Of these, more than 200 are openheart surgery cases.

In Kamloops there are 1,406 patients; 800 of these requiring

hospitalization are forced to wait 9 to 12 months for surgery.

Perhaps

the worst situation of all is presented here in Victoria, where

emergency cases have been turned away on account of a lack of hospital

beds. The two Victoria hospitals report more than 2,000 patients on

their waiting lists for surgery. Every doctor in town tells stories of

persons who travel for definite surgical appointments, taking time off

from work, and arrive to find there are no beds.

Mr.

Speaker, with that I request leave to move that the House do now

adjourn to debate the urgent public matter of unacceptably long and

growing waiting lists for treatment in British Columbia hospitals, and

the failure of the Minister of Health to take urgent action to resolve

this situation.

MR. SPEAKER: Thank you, hon. member.

There is a rather lengthy statement which is the

preamble to the

motion. I will take the matter under advisement and seek to bring an

opinion back to the House shortly as to whether or not the criteria are

met — rather stringent criteria, by the way — which determine whether

this motion qualifies under the standing orders.

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:

This afternoon I'd like to respond to some of the comments made late

this morning by the member for Maillardville-Coquitlam (Mr. Levi) and

the second member for Vancouver Centre (Mr. Barnes). First of all, I

was intrigued to listen carefully to the suggestions of the member for

Maillardville-Coquitlam as to what the policy in British Columbia,

relative to rent control, should be, as he saw it. If I heard him

correctly, I believe he made reference to the fact that you could put

rent controls on and take them off. I believe there was the inference

that there should be some on-again, off-again approach to the

application of rent controls as circumstances required. It would seem

to me to be a call for what could be described as an on-again,

off-again policy with respect to rent controls. Perhaps a little later

this afternoon he could clarify that. If indeed he is saying that as a

matter of policy rent controls should be utilized on an on-again,

off-again basis, then his suggestion would pose yet further

difficulties in any effort to increase the supply of investment for

rental accommodation. Of course it is, I think, fundamental that

investors want some certainty and some predictability as to what the

state of the investment climate will be. To the degree a policy is

going to be on-again, off again, unpredictable, very ad hockish and

irregular, I think it's fair to say that investors are going to prefer

to turn their potential housing and rental accommodation investment to

other jurisdictions where there is greater certainty and stability in

the policy and the program. For my part, I would appreciate some

further comments on this suggestion of controls perhaps going on and

off and back and forth quite quickly.

The member also fell

short of specifying the degree to which he felt rent controls should be

expanded. I think it was implicit in his remarks that he was calling

for a reduction, if not abolition, of rent review and a substantial

expansion of rent control. If that be a correct analysis of his views,

I think it should be a set of views which are completed with some

specific numbers, so that the public and the analysts are fully

familiar with precisely what the member is advocating. I wonder if

perhaps later in the day he might spell out the precise dollar levels

and size of unit levels to which rent controls should be expanded and

for how long.

As I say, our view is that the goal of rental

policy in this province should be supply, supply and more supply. To

the degree policies come forward which will encourage supply, we think

they are to be pursued. To the degree policies come forward which will

discourage the supply of rental accommodation, we think they should be

looked at very cautiously.

The member made some reference to

the recent home financing conference sponsored by the ministry. By his

comments, I can only assume he's not fully familiar with what we tried

to do. I should tell him that the 65 or 70 people who were there were

all senior and experienced in the field of accommodation development or

lending. We had a good cross-

[ Page

5409 ]

section of people from the credit union movement, the trust

companies, the banks, and the housing industry large and small. One of

the points they stressed in the course of the discussion on rental

accommodation was the need for certainty and consistency. They

specifically made the point of telling government that one of the

things that all governments in the last decade had been doing wrong

with respect to housing and rental policy was to change the rules

constantly. Their view would certainly be that if policies were to be

on-again, off-again, that would be further inducement for their

investments and construction activities to be used in other

jurisdictions.

Perhaps the member doesn't appreciate that the techniques in

accommodation financing we looked at, including share depreciation

mortgages, were techniques which were applicable not just to housing

but to rental accommodation as well. I think the member would probably

agree that the cost of money is one of the very key factors that a

potential builder faces, and that clearly the cost of money is

reflected in market rents. To the degree to which we can effectively

lower the cost of money to the builder and to the developer, we can try

to make new rental accommodation cheaper. For that reason I think the

conference was a very useful step forward.

The member was

concerned, and properly so. He said: "Well, apart from prospective

accommodation, what is the government doing immediately to assist

tenants who are very concerned about their economic predicament in a

very difficult rental market?" I want to outline for him the things we

are doing that are immediate and flexible and provide response on the

economic side to those groups the member mentioned — people of low

income, people on fixed but modest income, and senior citizens. What we

are doing, of course, is to place great stress at a time like this on

the three economic programs offered by this government to assist those

facing severe economic difficulty in meeting rental payments. I refer

to the SAFER program, to the GAIN for seniors program and to the

Rentaid program. These are three very specific, direct programs of this

government that are available to those who, as a consequence of a rent

increase, find their household budget in a state of crisis. Those

people can look to these programs.

The member says: "What can happen immediately to assist these people?"

If, for example, a senior finds as a result of a rent increase that for the

first time more than 30 percent of that senior's annual budget is going

to be required for rent, the provisions of the SAFER program automatically come

into play. Similarly, for the lower income groups, the Rentaid provisions by

way of tax credit assistance automatically come into play. There is also the

GAIN program for seniors. So in addition to the basic rent control mechanism

in place, to the companion piece of rent review and to the efforts that we

re making to maintain British Columbia's record level of production of housing

and rental accommodation, we have these three — if you like — financial assistance

programs to assist people in need.

Further to the point of what the government is doing to assist tenants during

this difficult period, the fact of the matter is that in the last several weeks

we have been mailing to every tenant registered in a multi-unit tenanted building

in British Columbia a very useful guide called "Renting? Renting? Renting?

— Guide to Landlord Tenant Relations Under the Residential Tenancy Act."

The purpose of that initiative is very simple. We are trying to put into the

hands of British Columbia's tenants, during a period of rental shortages

and very great concern on their part, a simple, easy-to-read guidebook which

will outline to them their rights and the remedies. If you open this newly produced

guidebook, the first topics discussed inside the front cover are those three

financial programs to which I have referred — financial assistance to tenants

by way of SAFER, GAIN for seniors and Rentaid. That's the first thing the

tenant finds in opening this book.

MR. LAUK: What's the second thing? Your photograph?

HON. MR. HYNDMAN:

There's no photograph there, Mr. Member. In going through the book,

there is a very useful

summary of the rights and remedies of tenants in

British Columbia. We think that's a very timely thing to be doing in

his very difficult rental market. It is certainly not fair to suggest

that the government does not have programs. on the financial side to

assist tenants put into a position of severe economic difficulty as a

result of rent increases.

I'd like to review the figures I

quoted showing British Columbia's continuing record level of housing

starts. In British Columbia in 1980 it is now projected that housing

starts will reach the level of 45,000. At least for the first three

months of this year, that's more than in the provinces of Quebec and

Ontario combined. There is a record pace of accommodation construction,

but the member says that that is not really immediate help and relief

to tenants.

MR. LEVI: Who's going to buy them?

HON. MR. HYNDMAN:

The answer is this, gentlemen. First of all, every tenant who is able

to leave a rented premises, purchase a home and become a homeowner is

freeing a tenancy for some other tenant to move into. There's a

correlation between housing production and sales, and the pressure on

the rental market. To a degree, through the production of housing we

can develop a greater capacity for tenants and renters to become

homeowners. We'll be freeing available rental stock for new tenants to

move in and enjoy. We think t's very important to be concerned with

housing production and to be encouraging housing production.

The interesting thing, now that we've had about three or four hours of

discussion on rent control, is that as I've listened, the opposition has

yet to utter a phrase of encouragement or incentive to the suppliers and builders

in this province. I hope in the course of these estimates the opposition will

have a shopping list of incentives from their side of he House to encourage

people to come in and build housing and rental accommodation. Let's hear

their formulas and suggestions as to how we can better achieve a mix of permitted

income levels in new rental developments. That would be very useful contribution

to this debate.

I listened to the remarks of the second member for Vancouver Centre (Mr. Barnes)

with care. I want to comment in particular on one aspect of his remarks relative

to — as I understood his remarks — the long-time residents of the Vancouver Centre

area who are now being forced to sell their homes to permit apartment development

or construction. He referred to high taxes as being a factor which forced long-time

residents to sell their homes and leave the area. The member may be aware that

there's a program offered by this government to assist senior citizens facing

that high property ax situation who want, however, to stay in their traditional

family home. They can defer that tax payment under the

[ Page 5410 ]

provisions

of the program and have the taxes accumulate at a very modest interest

rate against the property. Certainly if the second member for Vancouver

Centre has constituents who want to stay in their homes of some years

in that area and high taxes are the problem, we'd be happy to give him

particulars of that program.

Interjection.

HON. MR. HYNDMAN:

I know. If a person wants to sell their home, it's a two-way street.

There's got to be a buyer and a seller. I think some of those people

are enjoying prices for properties....

Interjection.

HON. MR. HYNDMAN:

Mr. Chairman, I have an excellent little sign here for my friend across

the aisle, which I'll send over in a few moments. He might care to read

it from where he sits, if his glasses will permit.

In any

event, I think those persons who are selling in this market are

probably achieving a fairly substantial price for their property. I

hope I didn't hear the member say that he was totally against any

redevelopment in greater Vancouver even if that would mean an increase

in the number of accommodation units. I hope I didn't hear him argue

for a massive expansion in the rent control program. Perhaps he, could

clarify that in his remarks. I look forward to those further comments.

Vote 44 approved on the following division:

YEAS — 26

Waterland

Hyndman

Chabot

McClelland

Rogers

Smith

Heinrich

Hewitt

Jordan

Vander Zalm

Ritchie

Brummet

Wolfe

McCarthy

Williams

Gardom

Curtis

Phillips

McGeer

Fraser

Nielsen

Kempf

Davis

Strachan

Segarty

Mussallem

NAYS 25

Macdonald

Barrett

Howard

King

Lea

Lauk

Stupich

Dailly

Cocke

Nicolson

Lorimer

Leggatt

Levi

Sanford

Gabelmann

Skelly

D'Arcy

Lockstead

Barnes

Brown

Barber

Wallace

Hanson

Mitchell

Passarell

An hon. member requested that leave be asked to record the division in the

Journals of the House.

On vote 45: executive and administration, $1,313,577.

MR. LEVI: I've just one question of the minister. At the moment

he's got an acting deputy minister. What is the procedure he's using

to secure himself a full-time deputy minister? Just exactly how is he going

about it?

HON. MR. HYNDMAN:

I think that's a very important question. The approach I've taken is

that, first of all, being new to not just this ministry but to cabinet,

I want to get some feeling for and handle on the operations of the

ministry before settling and assessing in my own mind the type of

person I want and the approach I want to take to recruitment. I've

pretty much settled that in my mind now and am in the process of

getting underway the search end of the operation. I've had discussion

with Mr. Cantell, my acting deputy, to indicate to him the stage I'm

at. I do want to say that I've had splendid cooperation from Mr.

Cantell and his senior level of managers in the ministry, who've been

very understanding of my need to develop a feet for the way in which I

want to go. As I say, the search and selection process is now just

beginning.

MR. LEVI: Would the minister tell us

whether he first of all goes inside his department? Does he look at the

people he's got? Does he establish who are the comers, the people who

could do a job like this? Has he any idea who he has in his department

who is a potential deputy minister — apart, of course, from Mr.

Cantell, who is the acting deputy minister? Where is he looking, or is

he going across Canada? And, while you're up, you might also tell us

what the salary is.

HON. MR. HYNDMAN: I understand the salary is $61,000.

What

I've done in my own assessment and analysis is begin with a look here

in British Columbia. Frankly, I have not given much thought past

British Columbia at this point, although I do intend to look fully at

the question before making any decisions. Most certainly, there are

some very able people in this ministry and in the public service of

British Columbia outside this ministry.

MR. LEVI: In

respect to the vote itself, as you know, we have been examining all

votes very carefully and we've examined this one. I am going to move an

amendment which will indicate that there should be a saving, and I

would like to move that vote 45 be reduced by the amount of $2, 209.

MR. CHAIRMAN: The amendment appears to be in order.

On the amendment.

MR. LEVI:

The important thing about this vote, which is the executive and

administration vote, is that obviously some slight changes are taking

place. We have within it a very large vote of the order of $449,000,

which is "policy, legislation and programming." We've looked at that,

and I understand that is what concerns the minister in terms of the

continuing development of his department.

The reason we are

reducing the travel expense vote is that we feel it is an addition

which is not necessarily something that should be done. That's why

we've actually moved this amendment. There are, of course, other areas

that we've also looked at. But the amazing thing is, Mr. Chairman, that

there has been a general theme throughout the votes we've dealt with up

to now, which is the heavy increase in the expenses. There appears to

be no attempt on the part of the government to curb its expenditures,

particularly in the area of travel expenses, office expenditures and

furniture. With this one we have an attempt to reduce; however, in this

one there is no

[ Page

5411 ]

attempt at all, just for an inflation over last year of some $2,200.

Amendment negated.

Vote 45 approved on the following division:

YEAS — 26

Waterland

Hyndman

Chabot

McClelland

Rogers

Smith

Heinrich

Hewitt

Jordan

Vander Zalm

Ritchie

Brummet

Wolfe

McCarthy

Williams

Gardom

Curtis

Phillips

McGeer

Fraser

Nielsen

Kempf

Davis

Strachan

Segarty

Mussallem

NAYS — 23

Macdonald

Barrett

Howard

King

Lauk

Stupich

Dailly

Cocke

Nicolson

Lorimer

Leggatt

Levi

Sanford

Gabelmann

D'Arcy

Lockstead

Barnes

Brown

Barber

Wallace

Hanson

Mitchell

Passarell

An hon. member requested that leave be asked to record the division in the

Journals of the House.

AN HON. MEMBER: Mr. Chairman, there's an amendment.

MR. CHAIRMAN: Hon. members, just to make things perfectly clear —

possibly this may go some length to explain the situation — there was

an amendment before the House which was defeated on a voice vote. Then

we called for vote 45 itself to pass. On that vote the division was

called, The Chair regrets not pointing that out, but it tried to do

that for the benefit of all members in the House. The question now

before us is the passage of vote 45, which has been passed.

On vote 46: consumer affairs, $2,850,988.

MS. BROWN:

Mr. Chairman, I really wish the House would come to some semblance of

order. The whole point is that there wasn't a House Leader in here.

That's why all the confusion started. All of the government members

were away. I had to call vote 45, because there was no one over there

to do it. We're tired of the incompetence of this government —

ineptitude too.

I want to make a couple of comments on this brochure put out by the ministry

— "The B.C. Trade Practices Act" — which I think for the most

part

is a pretty good brochure. What it's trying to do is use cartoons to get

certain messages across to consumers. The one criticism I have about the brochure

is the way in which women are used in the cartoons. There are about six cartoons

in the book, I think. Two of these cartoons use women instead of men. I notice

the minister is quite amused by what I'm about to say. I have received a

number of phone calls about this brochure. That's the reason I'm raising

the question. It was actually brought to my attention, because I did not get

a copy of the brochure myself.

The

first cartoon ridicules the fact that a woman had a clock that didn't

work. The whole point of the cartoon is that she has a face that would

stop a clock. That's a very old and a very tired cliché. It's not

necessary for that to be included in a government document at this

time. Certainly people are offended by this. I don't think either a

woman or a man should have been used to get this kind of message

across. It's not funny, and it certainly does not add anything to what

is for the most part quite a good brochure. The only other cartoon in

the book which uses women has to do with ridiculing the helplessness of

women. It's the final cartoon, in which she says: "I need help." He

smirks and says: "You can say that again."

I think it's

unfortunate that a document which is going out from the ministry with a

very important message, into the school system where it is going to be

used by a number of people, should have seen fit to use women in a

ridiculous way in its cartoons. I hope that when the minister responds

to this very serious issue which I'm raising I won't get a facetious

reply. I hope he will recognize that women are offended by it and that

it defeats the whole purpose of the brochure itself.

No one

objects to humour. We use it as a form of teaching, learning and

remembering. I certainly like this particular comic strip which we see.

called B.C. , which appears in the Province .

I follow it regularly. As I said, it's unfortunate that the only two

cartoons in the book that use women had to take this opportunity to

ridicule them. I'm very sad about that.

HON. MR. HYNDMAN:

This is an important topic to me, and therefore I want to say a few

words. I want to thank the member for Burnaby-Edmonds for her comments.

I want to assure her that I take her comments and the issue seriously.

I want to say to her, in all sincerity, that I look toward to her

comments on the same topic a year from now. I hope that I will be able

to demonstrate over the next 12 months an attention to her concerns

that will earn some positive words from her.

Most certainly,

in the ministry itself we're making a very solid effort to acknowledge

the importance and contribution that women have to make. For example, I

look around the province at our consumer centre in Kamloops where Mrs.

Margaret Spina is our manager; she very effectively manages a very

substantial place of operations. In our legislation and planning branch

we have several women who make a very substantial contribution to the

policy planning of this ministry. With respect to the educational games

that we're developing on the consumer side of the ministry, I think

it's fair to say that we've been careful to treat both boys and girls

equally in that context.

I most certainly regret that from

some points of view an otherwise excellent pamphlet to which the member

has referred may suffer from the concerns she raises. I can assure her

that I take those comments seriously. We'll do our best over the next

year to address those concerns in a better way.

MRS. WALLACE:

I note that the prime purpose of this vote is to promote fairness and

knowledgeability in the marketplace relative to consumer affairs. I

have some very grave concerns relative to what's happening in the food

industry in British Columbia. I have attempted to raise this with this

minister's counterpart who is responsible for food, without any great

degree of success, because he has indicated that his

[ Page 5412 ]

interests in food relate basically to some marketing promotion for B.C. products.

concerns go a bit further than that. As a wife, mother and consumer, I

have some very grave concerns about what is happening in the area of

food, particularly as it relates to children. I have raised the matter

of the Coke promotion, in which another colleague of this minister has

been involved in assisting one company over another in the Coke wars

that are besetting us on every form of media that we care to turn to

today. That product certainly has little or no nutrition. It's full of

sugar and caffeine. It's definitely a harmful product that's being

pushed at young people in an attempt at addiction, it would appear.

I'm

also concerned about the degree of concentration that's occurring in

our food outlets, where we find a continuing trend to more and more of

the consumer's dollar being spent in fewer and fewer stores. When I

recognize the kinds of dollars that are paid to those stores for

promotion of product in the form of shelf-talkers, eye-level display

space or other forms of gimmickry — advertising techniques that are

aimed at influencing the consumer — I recognize that the poor consumer

really doesn't have very much chance of combatting those kinds of

organized corporate dollars that go into promoting products. It's not

based at all on their nutritive or food value, but entirely on the

amount of profit that a company can make from a particular product.

believe this minister, as the Minister of Consumer and Corporate

Affairs, has a very definite responsibility to take some action. I note

that in Quebec, for example, there is a limit to the kind of

advertising that can appear on television relative to food products

during certain hours when children are watching those programs. We

don't have anything like that in British Columbia, Mr. Chairman. I

think it's time that this minister moved into looking at that

particular aspect very firmly. If he can do it in conjunction with the

Minister of Agriculture and Food (Hon. Mr. Hewitt), so much the better.

What I don't want to see happening is this continued passing of the

buck. I've raised this business of nutrition with the Minister of

Agriculture and Food, because that seems to be where it lies, but I

suggest that the minister now responsible for food and the Minister of

Consumer and Corporate Affairs have some very definite responsibilities

to ensure that at least there is, as this vote says, fair and

knowledgeable perception on the part of the consumer, and not that

high-pressure salesmanship and advertising that the consumer is

continually finding herself or himself subject to, particularly in the

area of food.

We have a lot of complaints about the high

cost of food. So let's ensure that when we spend a dollar for food, we

get nutrition for that dollar, that we're not spending that dollar for

six or seven fancy packages to include one product; that we're not

spending it to allow that manufacturer to pay huge sums of money to

retail supermarkets to ensure that his product is displayed in a

prominent place on the shelves of that store. That's what's happening,

Mr. Chairman. It's not fair to the consumer and it's not fair to the

children of this province, who, in many instances, are not getting a

nutritionally adequate and nutritive diet because of this pushing of

junk food by the corporate sector on the consuming sector in this

province.

HON. MR. HYNDMAN: Mr. Chairman, as a father

of four young children may I say I can associate myself with some of

the concerns that the member for Cowichan-Malahat has outlined relative

to the food industry. I know of her interest in agricultural matters,

so she may be interested to know that this coming Saturday I'm going to

spend the afternoon on a panel with, I think, my friend from

Maillardville-Coquitlam (Mr. Levi) at the B.C. Marketing Board. While

that's always a challenging topic for a Consumer Affairs minister, I

think it's one I should be getting involved in and familiar with; it

certainly relates in part to the question of food pricing.

Speaking

of corporate concentration, I'm happy to tell the member that I've just

received from my federal counterpart, the Hon. André Ouellet, a copy of

his most recent remarks relative to proposed changes in federal

competition policy. I've not yet digested those, but I certainly am on

record as stressing the desire of this ministry to promote competition

in the marketplace. I think that's a very important part of our policy

approach.

Regarding the question of advertising on

television relative to children — TV commercials for kids — I've got no

specific comment today, other than to say that, philosophically, the

route I'd prefer to see government go in the area of consumer education

and protection is not the route of government, in effect, taking

consumers by the hand and every time they're in the store, helping them

around the aisles and through the shelves. Rather, I think, the better

approach is to devote our resources to equipping and educating

consumers — young or small — so they are able to, on their own, once

they're well equipped, take their place in the marketplace and compete

effectively and get the most for their dollar. But I've made note of

those comments and I find them helpful.

[Mr. Strachan in the chair.]

MR. LEVI:

Mr. Chairman, I have a couple of questions for the minister, and then I

want to just deal with two matters relating to the Motor Dealer Act.

One of the questions is: how is the cemetery thing going? Maybe you

could tell us what you've got in mind. I don't want to mention

legislation, but you must have something in mind.

I want to

deal with one case that comes under the Motor Dealer Act, dealing

particularly with regulation 23. I want to tell the minister a short

story and then get his comments about it. You're a young man and you

want to buy a car; you go to a dealer. You buy the car and you pay cash

for it. It's a new car. You take the car out, and you decide to go on a

weekend trip with your family. The day after you buy the car, when

you're getting the gasoline tank filled up you notice the car wash next

door. You go over to the car wash and say to the fellow: "Can you wash

up the car? We've just done a couple of hundred miles and it's a new

car." During the course of the washing, the man says: "If this is a new

car, you've got a pretty bad problem on one panel; it looks like it's

been banged up. If we continue to wash the car, the paint will peel

off." So the young man takes a look at it, and he's a little bit

horrified. The next day he goes back home. On Monday he goes in to see

the salesman and he says: "Look, you told me this was a new car. I paid

for a new car, and here I have a problem with the paint peeling." He

couldn't find the salesman who sold it to him. Nevertheless, he said

he'd come back. He took it to another garage to somebody he knew. The

mechanic said to him: "This car was damaged. It's been pounded out and

it's been painted." So he went back to the place where he bought it. He

could get no satisfaction. He simply left the car and the keys there

and went home.

[ Page

5413 ]

I refer the minister to

section 23 of the regulations of the Motor

Dealer Act, which says: "A motor dealer shall ensure that in every

written representational form of sale or purchase agreement respecting

his offering for sale or selling a motor vehicle, he discloses to the

best of his knowledge whether the motor vehicle has, (1) in the case of

a new motor vehicle sustained damage or required repairs costing more

than 20 percent of the asking price of the motor vehicle...." The man

paid $7,000 for this motor vehicle. The second obligation of the dealer

relates to "in the case of a used motor vehicle sustained damage

requiring repairs costing more than $1,000." We are clearly in the

first case. The individual bought what he supposed was a new car. He

paid almost $7,000 for it. Because he left the car there, a few weeks

later he received a notice from a lawyer saying that he owed $1,600.

The $1,600 related to the repairs that had to be done, plus the loss of

profit.

Let's suppose a person paid $30,000 for a brand new

Rolls Royce. That car could have something less than $5,999 worth of

damage on it, with no obligation on the part of the seller of the car

to declare that this car had been damaged to that extent. That may be

extending the point a little bit, but this is what happened to this

individual. He bought a new car. The person who sold it to him did not

in any way contravene the regulation. Yet there was almost $1,500 worth

of damage to that car. He took it back because he did not get what he

had paid for in terms of a new car, and he's on the hook for....

don't want to go into it any further. As a matter of fact it's under

appeal before the courts. He lost the case against the $1,500 charge.

Basically we have a regulation here which allows a fair amount of

latitude for motor dealers, particularly in relation to damage. After

all, as the obligation states, there is no regulation. I'm fairly sure

that that is not what we had in mind when we did the bill. We did not

have in mind that people could wiggle away under the act by virtue of a

regulation which says if it's a new car and it's less than 20 percent

there's no obligation to tell the individual. We have a live case of an

individual who got caught in that particular predicament. There are

probably other cases.

Basically we should examine the

functionability of such a regulation, because it's not in the best

interests of any consumer. We're dealing with the exotica now, because

we're dealing with the regulations. Very many people out there look at

the act and never think about all the regulations going with the act —

they never know about that. They presume what they're going to get is a

straightforward commitment. I'm not suggesting this is done by every

car dealer, but it has happened on at least one occasion, and it's open

to some kind of abuse. If you have a very hard-nosed dealer who wants

to sell a car, he's quite within the law to sell a car, and if it has

damage of less than 20 percent of the purchase price he doesn't have to

say a thing. I hope your policy and legal people will look at this.

It's a very serious problem.

I want to move to a second

matter. I'd like the minister to tell us what kind of relationships his

department has established with the large automobile manufacturers. I

have in mind General Motors, Ford and the rest of them. I'm aware of a

particular case of a young man who bought a truck which he used as a

tow-truck. In less than a year the repairs were between $8,000 and

$10,000, and there was at least $12,000 of lost time because of the

constant repair.

There's a very serious problem here. The

problem first of all is what the minister's department is doing through

the Motor Dealer Act. This young man dealt with them. It was a long,

difficult proceeding, and really nothing happened. In going back on the

matter with the department it's still difficult. I think part of the

problem relates to the fact that the people who operate the Motor

Dealer Act — the ministry, in fact — need an intervention by the

minister in the sense of sitting down with these people and relating

this kind of problem, which goes on all the time. As a matter of fact,

this particular model of truck was subsequently recalled after the

young man had disposed of it. We dealt with Mr. Edmonston in Montreal,

who assisted us in finding some of this information. It seems to me

that if the minister is serious about doing something about the Motor

Dealer Act he might well lay out enough money to bring Mr. Edmonston

out here to give him some advice. As you know, he is probably the Ralph

Nader of the car industry in Canada.

I say this because this year the official spokesperson for the ministry announced in the Times-Colonist

on May 1: "The Provincial Consumer and Corporate Affairs ministry is to

beef up its motor dealer regulations to reduce the price guessing game

facing people buying cars." That's a move. I don't know whether that's

going to cover the first case I gave you, but at least I've brought it

to your attention and you're aware of the case. "A spokesman said that

on Thursday it will be made mandatory for dealers to 'display price

stickers on all cars." That was rather a surprise to me. I thought we

debated this three years ago and that's really what we agreed would

happen. However, that's apparently not the case. "The current

regulations say only used cars which dealers advertise or post signs on

such as 'Sale' or 'Today's Special' must bear a price sticker. For

other cars it's left to the dealer to decide whether to put the price

on the sticker." When the minister is looking at that I hope he will

look at regulation 23 under the Motor Dealer Act.

Specifically

to the second case I related. About three years ago his immediate

predecessor had to take on General Motors in relation to a car which

had an engine in it that they had advertised as being something else.

The amount of $200 changed hands, which was rather an inadequate amount

considering what engine should have been there versus what they put in.

However. the door was open to negotiate with these corporations. One of

the most serious problems we have in the automobile industry — we can

deal with trucks or with cars — is the whole question of performance.

We live in an era where nine million cars to be recalled in a couple of

years doesn't seem to shock anybody anymore. I can recall a few years

ago when they started.to recall cars as a result of the work that Nader

did years ago. Now you pick up the paper and you find that of nine

million cars over the past two years four million are about to be

recalled. There is one figure of 29 million cars recalled in the space

of seven years. We get there to the issue of consumer protection in

terms of: what are these people selling? Then there's the other area,

the matter of safety.

Your department is basically a

complaint department. You're not in the design business. That's pretty

much in the jurisdiction of the federal Department of Transport. They

seem to do some of that kind of thing. Talking to branch managers of

large corporations is not very effective. If you talk to the Pacific

representative, he's under the gun; he's part of the pecking order. All

they want from him is an increase in sales volume. "Don't say anything

about the complaints, because if you commit us, we're in trouble. We'll

have to go to court." Basically, the approach to a lot of people who

make complaints is that they never commit themselves to anything.

[ Page 5414 ]

They don't admit anything. It's practically like talking to the wall.

The

motor dealer

section of your ministry has got a function to play only

on the street level, as it were, trying to deal with individual

problems. Some of that happens. It's happening under the Trade Practice

Act. Sometime later — because I don't know whether it's proper to do it

in the House — I will talk to the minister, hopefully in his office,

about the number of people who are repeaters under the Trade Practice

Act. There are certain people who have become repeaters. That's a

problem. You get through one and then there's another thing happening.

In terms of the whole business of the enormous amount of money that's

spent on trucks and cars — the young man who lost a large amount of

money and got absolutely no satisfaction whatsoever.... After all,

taking on General Motors is the last thing in the world that most

people even dream of doing. However, there needs to be something beyond

the motor dealers division. It's something that I suppose the minister

has to deal with with his federal and provincial colleagues. It's a

very serious problem. It has to be highlighted. I don't know how you

bring large corporations to the point where you say to them: "You have

an obligation to produce a product for the consumer that he or she has

a reasonable expectation will function." If it doesn't, is it a

question of replacing it or compensating? How does the young man I have

in mind get compensated for all the money he has lost? It's almost that

you have to embark on a class action.

This one is a

particularly good subject and is well documented — all the bills that

were paid and the little discounts they gave him, because he kept

insisting on going back because the brakes were faulty. It was

eventually recalled on that basis. It was a long, miserable tragedy for

that young man. Yet there is no redress unless you go to court. It's

the kind of thing that's not possible for the average working man to

do; it's too difficult.

The minister is new. He's looking at

a lot of things. I'd like to get his views on this. His predecessor did

take on General Motors in the sense of these people getting some kind

of compensation. I'm sure he was joined by some of his colleagues

across the country, because it happened in every province. There is a

need to look at the regulations under the Motor Dealer Act. Federally

and provincially, the issue of an adequate product and compensation if

the product is not adequate has got to be looked at. It's a very

serious matter, and I would appreciate the minister's views on it.

HON. MR. HYNDMAN:

Perhaps I can preface my remarks with a brief comment on the cemeteries

issue, which the member raised, and let him know that I'm very hopeful

that in next spring's session we'll be introducing the new cemeteries

legislation — the package result of several years of very intensive

work and research following upon Professor Neilson's and Professor

Gosse's earlier work. I'm hopeful that sometime in advance of next

spring, if we have the opportunity in the fall, we can perhaps table

what we hope to bring in in the spring.

With respect to the

Motor Dealer Act and the several questions raised, I'll deal first with

the regulations. I think the member coined a useful term — the

"functionability" of those regulations. I want him to know that we

studied with care his late February column on the topic from, I think,

the Coquitlam Herald .

Ministry staff are now looking at that very question as to whether the

percentage limits should be changed, given that in this day and age of

rising vehicle prices — both new and used — those percentage limits can

result in the exclusion of what nonetheless to a working person is a

very sizeable dollar cost of an improvement or repair. Those are being

reviewed as to their functionability.

It would follow from

the example given that in any event, as an alternative remedy, the

Trade Practice Act could be looked to. Within that framework, may I say

to the member that one of the areas where I hope over the next year the

ministry will take a somewhat more aggressive posture which may be of

some assistance in cases like this is the area of substitute actions.

If we find a repeating class or type of problem with, say, motor

dealers, where the law is either vague or not established, and if we

see the benefit to a broad group or class of consumers of establishing

a principle in one substitute action, thereby having a guidepost for

the future, we're prepared to look at that.

Relative to the

large automobile manufacturers, I will think pretty carefully on the

suggestion; in fact, I will sit down with our motor dealer people in

some detail. There's no question, as the member knows, that motor

vehicle complaints are the highest percentage compartment of the

complaints that we're getting around the province. In my experience, a

lot of dealers do try to do a pretty good job of after sales service,

making sure the warranty is properly observed and so forth.

Notwithstanding that, we always have these series of very unfortunate

cases, particularly in terms of downtime with vehicles that are used in

whole or part for a business or occupation. So I will certainly be

prepared and I will sit down with our Motor Dealer Act staff.

I'm

intrigued by the suggestion of bringing Mr. Edmonston out. He certainly

has earned a very prominent and productive place in the consumer

movement, relative to automobiles. I think that in spite of the energy

crunch, the automobile is still very much with us in the reasonable

future. Today, when we find the price of an average North American

sedan, modestly equipped, approaching the $10,000 level, we're not

talking about small dollars. I am certainly not frightened by the fact

of size of the large auto makers. The more aggressive use of the

substitute action might be the avenue that this ministry takes if we

see a problem emerging that needs redress on behalf of a group or class

of consumers.

I'd also hope, of course, that on the product

quality side the recent concern of the North American auto industry,

relative to imported competition, will lead internally in the North

American industry to a greater attention to detail, product finish and

so forth.

I certainly acknowledge that the problem is there.

I suppose it's the nature of a mass-produced, highly complicated,

mechanical item that there will be a percentage of problems and those,

because of the cost of the item, are going to be expensive, both in

terms of dollar cost and the frustration to the human beings involved.

If the vehicle is used in whole or part for business purposes, the

frustration is much greater. I certainly acknowledge that the

marketplace, in terms of the feed-in we're getting, has automobile

concerns ranking well up there.

I certainly will undertake

to sit down with our Motor Dealer Act staff and officials. I went to a

couple of our interior offices, and the member will appreciate that

those were the people on the road with whom I spent some time. They

have a very large territory to cover. On the one hand, one is never

anxious to expand staff in this age, but I think that in the interior

of the province there is a very real need for

[ Page

5415 ]

beefing

up our motor vehicle people to let them cover the territory more

thoroughly. They're doing a very good job now, given the territory that

they have to cover. I'm certainly not unaware of those problems and

concerns. Hopefully, in a year's time we can report some very real

progress.

MR. MITCHELL: I'd like to bring to the

minister's attention the problem that I had dealt with at length in the

vote of the Minister of Municipal Affairs (Hon. Mr. Vander Zalm). This

particular item goes into both ministries. It is the problems of the

farmers who purchase large, steel-corrugated buildings for the farms. I

won't belabour it and go into the problem in the detail that I did in

the Minister of Municipal Affairs' vote. Basically, it deals with the

Aztec miracle steel buildings. Over the last number of years there have

been about 300 or more erected in British Columbia. There has been a

record of 24 that have been recorded with the Ministry of Municipal

Affairs and that have collapsed under snow.

When the

association of professional engineers and some of the farmers privately

visited the consumer affairs branch, they were advised that because

they were farmers — they were entrepreneurs — they did not come under

the protection of the consumer affairs branch, and one of the things

which I find very strange is in the agreement of sale for these

buildings. There is a

section which says: "This contract is subject to

the provisions of the Consumer Protection Act, SBC 1977, c. 6, and

amendments thereto, and may be cancelled by the buyer in the manner set

out in the statutory notice on the reverse side. This contract is

hereto."

Now this is the question which has arisen, and I

would like an answer from the minister: do farmers, in the purchase of

manufactured steel buildings and things like cars, which are not cheap

— they vary anywhere from $8,000 to $80,000 in cost...? They are a

large investment for a lot of farmers, a lot of people who have

purchased these buildings as storehouses, or workshops for machine

repair, etc. But when they approach the Ministry of Consumer and

Corporate Affairs — it doesn't matter that the contract led the buyer

to believe he was receiving certain protection under this act — they

are just told that the consumer affairs department is not interested.

They are not covered, because they were in business.

There

was a

section in the regulations, which was part of this agreement; it

said that the buyer is responsible for snow removal. This in itself is

completely in violation of the National Building Code. The National

Building Code,

section 20, definitely states that any building that is

sold or erected must conform to the building requirements of that

particular area. So if a person buys a type of steel building to be

erected in different parts of British Columbia, and he is in business,

and has signed a contract which states that he is covered by the

consumer affairs branch, when there is a collapse — it isn't only an

individual involved, but the Association of Professional Engineers and

other consulting engineers which called upon the consumer affairs

branch they got no help or direction.

I feel that if we are going to have companies come into British Columbia to

deal with the business community, or the farm community, or the communities

who use these buildings for ice-rinks and various other types of construction,

they should have some guarantee that (1) the building does come up to the National

Building Code, and (2) if the construction — and it's been proven from engineering

reports and studies done by Dr. R.F. Hooley, P. Eng., who was hired by the Association

of Professional Engineers of British Columbia, and after checking all the figures,

materials, standards, calculations, etc., provided by the company that this

building would not carry the load that the specifications claimed it would do....

This

in itself I can accept as bordering on fraud, maybe, or a mistake, or

something like that; but the fact that the consumer affairs department

gave no leadership, no help or assistance to either take action on

behalf of the individual farmers, or to bring in legislation to cover

this type of situation.... Now I don't know if it should come under a

type of class action, but I feel that the minister, through you, Mr.

Chairman, should look into it, and when there are problems like this,

the minister or the department should give leadership and not wait for

the opposition to continue to bring it up.

The leadership is

needed, and I feel the people I mentioned should be given protection

under the act. Their own contract states and leaves the impression that

they do come under the consumer affairs legislation, but everyone from

the ministry has advised them that they do not. Has the minister any

thoughts on it?

HON. MR. HYNDMAN: First of all, I

am always distressed to have reports wherein the ministry apparently

has not responded promptly and with concern to a very real problem,

even though, being a Consumer Affairs ministry, our policy has to be

that our resources first must go to traditional or normal consumer

concerns and then to concerns that come forward which might be more of

a business nature. I think on a limited resource base the business type

of concern must rank second to the traditional consumer concern.

However, having said that, I suspect many of those buildings are used

not directly for business purposes, but may have to do with the

enjoyment of the farm or the homestead by the farmer for residential

purposes, and most certainly I will look into it; I give that

undertaking. It may be, in terms of the apparent confusion, that it

stems from the face of the contract, wherein the vendor is required,

really, to point out to the purchaser that the rescission provisions of

the act do apply.

But the member is quite right, Mr.

Chairman. When those kinds of words appear on a commercial document, I

think the public is reasonably entitled to conclude that all of the

provisions of the act would apply. Most certainly our offices around

the province have become involved in consumer complaints concerning

mobile homes, for example, which are of a nature somewhat approaching

these kinds of buildings. I will certainly look into it, and I must

confess I was not in the chamber, Mr. Chairman, when the member for

Esquimalt–Port Renfrew (Mr. Mitchell) spoke in some earlier estimates

on the same topic. If he might furnish me with a

summary or a copy of

this material, I will certainly be very pleased to look into the

matter, and if he has some constituents with the problem, we'll give

them all the help we can. I thank you very much for drawing that to my

attention; I'd not been aware of the problem.

MR. LEVI: I have a motion I wish to move, Mr. Chairman: that vote 46 be reduced by the amount of $22,588.

MR. CHAIRMAN: The motion is all right. Please proceed.

On the amendment.

[ Page 5416 ]

MR. LEVI:

Earlier in the debate on this vote we were talking about the motor

dealer branch, and the minister said that if he had more staff, they

might be able to do a better job. In this particular series of votes we

again look at the business of travel expense and office expense. This

is the continuing and general theme that we've been using about the

inappropriate expenditure of more money in these votes than we think is

required, and we've arrived at some $22,588. Interestingly enough the

proper allocation of that $22,588 in some other way could have provided

them with another individual who could have done the very meaningful

service work in terms of the Motor Dealer Act, which he mentioned; he

said that he would like to have more people. The key thing is that it's

what you spend the money on, and these are the kind of frills that

money gets spent on. People are always asking for more office equipment

and travel allowances, but we're more interested in the service aspect.

That's why we have moved, Mr. Chairman, to reduce this vote by $22,588.

[Mr. Davidson in the chair.]

Amendment negatived on the following division:

YEAS — 25

Macdonald

Barrett

Howard

King

Lea

Lauk

Stupich

Dailly

Cocke

Nicolson

Lorimer

Leggatt

Levi

Sanford

Gabelmann

Skelly

D'Arcy

Lockstead

Barnes

Brown

Barber

Wallace

Hanson

Mitchell

Passarell

NAYS — 27

Waterland

Hyndman

Chabot

McClelland

Rogers

Smith

Heinrich

Hewitt

Jordan

Vander Zalm

Ritchie

Brummet

Wolfe

McCarthy

Williams

Gardom

Bennett

Curtis

Phillips

McGeer

Fraser

Nielsen

Kempf

Davis

Strachan

Segarty

Mussallem

An hon. member requested that leave be asked to record the division in the Journals of the House.

MR. HOWARD: Very briefly, before the question is put, I'd like to

raise with the minister, in this formal way, the communication directed to him,

dated April 28, from the Terrace Community Services, relating particularly to

the office of debt counselling and consumer complaint service in Terrace. Without

going into the details of the financial arrangements and funding of this particular

office, I should point out that over the past few years the funds available

to the debt counselling service in Terrace — covering Terrace, Kitimat and the

surrounding area — have been reduced. At one point, as a result of representations

made, the reduction was increased again and additional funding was available.

But it still puts the office of debt counselling and consumer complaint services

in Terrace at a financial disadvantage relative to the debt counselling services

in the other 14 centres in the province. Roughly speaking, the calculation shows

that the funding is about $14,000 in the other centres, compared to roughly

$9,000 for the debt counselling service in Terrace. The community services

board pointed this out in the letter to the minister. As a result of an internal

examination of their activities they were able to pare down their budget to

about $13,800 to provide this service, which is almost in balance with the

$14,000 average given to other centres in the area. They have felt for some

time that $13,000 or $14,000 is not really a very significant amount to provide

a service to the area affected. The debt counsellor, who operates on a part time

basis, basically has nothing in the budget for transportation. All his travel,

activities and so on come out of the $9,000, which is rather an insignificant

amount related to the area he has to cover and the service he has to provide.

want to raise this in a formal way with the minister: please, there is

the necessity to give more favourable consideration to this service

which is so greatly needed in that area; there is a transiency of

population there, and there are a number of other factors that entice

people to get into debt over their heads who can find no way out of it.

The advice which the counsellor can provide is invaluable to those

individuals who are not able to manage their own funds. It's a very

worthwhile service and a very worthwhile facility. I don't expect the

minister to jump up now and say: "Yes, we'll do that immediately."

Certainly the case has been put to the minister, and it's been put to

his predecessors. I raise it with him now in this formal way, to say

that here's something really worthwhile that the minister can

accomplish by looking at the debt counselling service funding in an

equitable way and on a basis similar to other centres. If the minister

would make some commitment even to look at it and examine it, and

perhaps get back to me privately about it, without taking up the time

of the committee, it would be greatly appreciated.

HON. MR. HYNDMAN:

Very briefly, Mr. Chairman, it's an important topic, and while the

member for Maillardville-Coquitlam (Mr. Levi) is here I just want to go

on record and say I have some considerable sympathy with the views

expressed by the member for Skeena (Mr. Howard) relative to the

northwest. The member for North Peace River (Mr. Brummet) has expressed

very serious concerns about the need in that developing area for some

of the services which we almost take for granted in the lower mainland.

We have, not yet, made no final decisions on funding for the various

regions.

I do want members to know that I am sympathetic to

the northern concerns. It's my personal view that in the lower mainland

and up the valley, while we have a lot more of the population, access

to the facilities offered in greater Vancouver is more convenient. If,

in the result, the policy shift is to those more rural and remote

regions, I hope members from those areas, on both sides, will support

me if there is some shooting from the lower mainland, because to

achieve those results some of the granting in the lower mainland may be

reduced. So I very much value those comments from the member for Skeena.

Vote 46 approved.

On vote 47: corporate affairs, $5,865,797.

[ Page

5417 ]

MR. LEVI: This is the heavyweight vote where a lot of the

real action takes place in this department, and I want to cover a

number of things with the ministry. I think I'll start with the stock

market and try to stay with that, and then sit down and get the

minister to respond. Then I'll get up and talk about real estate, sit

down and let him get up. Then maybe I'll talk about the first member

for Vancouver–Point Grey (Hon. Mr. McGeer), sit down and you can get up.

Since

I've been critic of this department I've always taken the position that

I want to stay away from one-liners in relation to the stock market.

We've heard them all: whatever it is, floating crap game, the biggest

casino in town. Over the years I've looked for some kind of resolution

for some problems, but that really hasn't happened. I understand from

"Provincial Affairs" — I may be wrong; I may have the wrong place where

he said it — that the minister is going to make an attempt to meet with

the governors of the stock exchange on a fairly regular basis. I think

that's on the right track.

About three years ago I had the

opportunity to meet with the governors on a couple of occasions, and

one of the things I said to them was that I thought their sense of PR

was terrible. I hadn't changed my mind up to yesterday — I haven't read

the paper today. Their sense of PR is terrible. I wrote a letter to the

president of the stock exchange at the beginning of 1979, at the time

when the BCRIC share issue was being talked about and we were getting

ready to do it. I said to the president: "I'm not suggesting for one

minute that you should comment on BCRIC, but what I am saying is that

we have a number of people who are talking about a BCRIC share issue.

The Premier said that everyone should get into the market and get into

some kind of share position. He was saying that; a number of people

were saying it. "Why do you not take the opportunity to come forward to

the public? Leave aside BCRIC, don't comment on BCRIC, but tell the

public what they can expect in going into the market. What does the

stock exchange do, what kind of protection do they have and what kind

of surveillance goes on?" After all, the whole campaign around BCRIC

was in the business of bringing to the market literally hundreds of

thousands of investors, most of them not knowing which end was up or

even where the stock exchange was. I asked him to do that. I didn't get

a letter, so I phoned him. He wrote me back and said: "I'll put it

before the board of governors." Nothing happened.

I'll give

you another example. Just about every group that we deal with in this

province that has some concern about the government takes the trouble

to send us an annual report or information on what they're doing. Three

years ago I said to them: "At least send us the annual report. Come and

see us; go see the government caucus; come see us, and tell us what

you're doing." Because if there's ever an operation that's constantly

in the public's mind today it's the stock market. Every time we have a

debate about BCRIC you're talking about the stock market.

had a very large shareholders' meeting yesterday. It was a very

positive thing in the sense of getting that many shareholders to come

out to attend a meeting. Sometimes you can go to a shareholders'

meeting in the Hotel Vancouver and you can't find the meeting, because

there are only about six people there and three of them are sitting up

on the platform.

In respect to the stock exchange, which,

very frankly, Mr. Chairman, up to about five years ago this party

didn't spend more than 10 minutes thinking about, it now is in a

position where some of the ambitions that have been exhibited by a

number of people in the brokerage houses — we can mention Peter Brown,

who was a great advocate of having an international junior company

stock-market operation.... I spoke to him about it, he told me what he

wanted to do and what a number of other people wanted to do, and it

appears that that has come to fruition. One just has to look at the

volume of shares, the number of companies and the incredible increase

in capital in respect to that junior market. Mr. Brown has come pretty

close to getting what he set out to do in terms of expanding that

market and moving it more specifically to a junior mining company

operation.

Not everything is well down there, obviously,

when you've got so many new companies coming on the market. We still

live to some extent with the reputation that this market had many years

ago. There has been a lot of effort put into surveillance — almost $6

million. If you calculate all of the expenditures, it's probably even

more than that. You have what your ministry puts in and what the RCMP

put in, because they spend a large amount of money. The last time I

spoke with superintendent Mullock in 1979 — he's now moving on to

Manitoba — we came up with a figure of almost $7 million of public

money being spent on the whole question of surveillance.

You'd

think that with the expenditure of all that money which we approve here

and in Ottawa they'd even send us an annual report, but they don't do

that. They don't tell us anything. We are the people that they will

come to if the act is amended, but they don't tell us anything. One of

the things that's sadly missing, and which has always been missing from

the debate which we have around the stock market, is: what do we have

to turn to in terms of any valuable studies that have been done on

stock markets other than what's taking place everywhere else, including

this place? We've never released anything.

I know the

minister knows that I'm going to bang away again for a plea that the

government release the Schroeder report, into which $125,000 of public

money went. In 1979, I think, his predecessor released a White Paper on

the stockmarket in which he was getting the views of a number of people

on some proposals for future legislation. I wrote him a letter. I said:

"Look, your White Paper contains some interesting information, except

that most of the observations and footnotes make reference to reports

that are outside of this province." They talk constantly about Ontario,

which has got one of the major operations, and they've done a great

deal of work in terms of setting their own house in order. That goes

back a long time — we're talking about the mid-sixties during the

windfall days. The Ontario Securities Commission has sponsored a lot of

work. We've spent $125,000 to look at the capital markets of this

province, and one can only conclude that either the capital markets are

so bad that nobody wants to talk about them or the report was so bad

that nobody wants to release it.

But I tell you this, Mr.

Chairman: if we're going to have in the future a sensible debate around

the changes in the Securities Act, which no doubt will come, we are not

going to be able to do it based on the information that we get from

other provinces. We have done the work here. We did it with the J.

Henry Schroeder report: we've done it with the Brown, Jefferson, Farris

report — two of them for another $60,000, which were never released.

Let me add a third one, which the minister may have some influence in

getting released. Talking about capital markets and the investment

area, there was the joint credit union-government report on the savings

and

[ Page 5418 ]

trust

bank during the latter days of the NDP government. That's a valuable

study. There are four studies, three of them done within the last two

and a half to three years, and the other one now six years old.

But

we do not have the kind of background information that is really

crucial for any reasonable debate or even the formulation of

legislation. I don't suppose that the government has released the J.

Henry Schroeder report to anybody. When I wrote to the minister's

predecessor and said, as I said in the House two years ago, "If you're

that uptight about the stock market part of the report, leave it and

just release that part that deals with the capital market — exclude the

stock market," he thought it wasn't a bad idea. But he didn't do

anything. When I wrote him and said, "Release the report...." You know,

when he wrote me back, I just about fell over. He wrote me back one

year after he had received the report and he indicated in the letter

that there was no point in releasing the report because it was out of

date. They received the report in August 1978, and in October 1979 he's

telling me that it's out of date! Well, he's now out of date too. He's

gone.

But I do ask the minister to be serious about things.

He's got this serious demeanour about him. If he's that serious, we're

going to need some information. I know — and he probably knows too, if

he looks through the mail in his department — that there have been

requests from the industry itself to have the report released. I've

heard all sorts of stories about the size of this thing. Somebody

suggested to me once that it was 1,100 pages. Well, I don't know what

the size is. The first time the minister who is now a hotliner

mentioned that he'd got it, he kind of shook us up by saying, "Well, we

want to really look at it," implying, we think, that he was going to

edit it.

That report is invaluable for some real

consideration of the stock exchange. Whether the stock exchange itself

has authorized or commissioned any reports on their operation, I don't

know. There's very little information in terms of reports which are

available to us from the stock exchange. What you mainly have to rely

upon are the sometimes lengthy articles by various writers who

specialize in finance and the stock market and that kind of thing. But

they usually deal with very current events. If the minister is going to

see the governors, then I would say to him: ask them if they want to do

some reports. Work together. But I'm sure they would ask him, if they

haven't already done so: what about the J. Henry Schroeder report? It

can't do you any harm, and probably would do you a lot of good.

Now

I want to ask the minister a specific question about BCRIC with respect

to the insider trading which took place. I am under the impression that

our superintendent of brokers was very slow off the mark to institute

an inquiry, and I want to know why. The basic impetus for the inquiry

came out of Ontario. Now that's an extremely serious matter. The whole

question of insider trading is a serious matter. I was quite surprised

that we were that slow off the mark. We seemed to go lock-step with

everything Ontario was doing, but we didn't initiate anything. That is

the impression I get from reading very closely not only the Getz

report, but also the report from the Ontario Securities Commission, in

which they talk about how they did their report. The thing is: why was

he so slow off the mark? There was a serious problem there, and perhaps

the minister will be able to give us some observations about this.

Then

I want to ask him this. About three years ago the procedures for the

vetting of statements of material fact were really placed squarely in

the hands of the department. I'd like the minister to comment about

what kind of staff he has to do this. At one time it was very small.

The increase in volume over the last year is quite dramatic. Then

there's the other question which attaches to this particular problem.

I've always been completely confounded by the failure of our legal

system to move far more quickly than it does in terms of investigations

and subsequent prosecutions around cases which come out of the stock

market. Now I realize that there is a case before the court at the

moment in which charges have been laid. I understand there is a former

employee who has been charged, and there are extradition proceedings,

and that's about as much as we can say about that.

But over

the years, when one looks at the various cases involving stock market

frauds, if you like, sometimes you can actually find that six years

have elapsed from the time the first charge was laid until the time the

case was completed in the courts. That's an incredible amount of time,

in which God knows what happens. Lawyers go there, make agreements

about adjournments.... I remember discussing with the commercial crime

people this very issue of why it takes so long to get these cases to

court. They told me at the time that in most cases they deal with they

can complete investigations in between 6 and 18 months. The major

problem is getting them on the calendar or whatever. Mr. Minister,

there are long delays in these cases. Meanwhile, of course, people who

have been badly hurt by this simply get no satisfaction whatsoever. The

delay in itself loses any impact that it might have on anybody else who

wants to pull the same kind of scam. It goes on. There is no deterrent

effect. I'm not a great believer in deterrence. I don't think the

deterrent principle as enunciated in law really works. Deterrence is

always good for people who never break the law. It doesn't do anything

for the people who set out to break the law. It doesn't deter them one

bit.

There is the question of this long delay in prosecuting

these cases. I know that there is a problem. I had it explained to me

by the Deputy Attorney-General in a letter. He told me that these cases

are so complicated — I appreciate that they are — that in terms of the

accounting aspect you need very special accountants. His department has

to stand in line like everybody else to get hold of ten or fewer

accountants who are available to do all this work. This is not directly

in the minister's area; but the whole business of surveillance and

initiating a prosecution is certainly within his area. The Securities

Act is clearly within his area.

In terms of the surveillance

aspect, what we intend to do — it's an opinion I have.... We have the

RCMP commercial crime squad. We also have the investigators within the

minister's own section. But investigation really isn't enough. We are

not going to be able to find a speedup within the commercial crime

section. After all, every time you talk about expanding the RCMP

commercial crime section, it's all part of that contract problem we

have with how much we are going to pay the RCMP in the first place. The

impetus has got to come from the minister. You're not preempting their

role. It's a very specialized investigatory role. It needs to be done

and done a lot quicker than it is now, because at the moment, in my

opinion, it's a bit of a joke how long it takes people to get to court.

Surely that's not in keeping with the good administration of justice

or, for that matter, enabling the minister to conduct his department

with any degree of cred-

[ Page 5419 ]

ibility

when it takes years to get a case completed. It's very damaging to the

system. It's extremely unfortunate that more is not done. Something has

to be done about this. I'd be interested in the minister's observations

on this.

I think what I'll do at the moment is sit down. I have a number of things I want to pursue, if the minister would like to reply.

HON. MR. HYNDMAN:

I've certainly indicated to the governors of the stock exchange that I

would like to have some regular opportunity to stay in touch with them.

I think one of the reasons why, for example, in the area of public

relations and public information the stock market might not be up to

the mark the member has suggested is that the governors and the people

in the investment community don't pretend to be either politicians or

knowledgeable in the area of public information. They're over doing

their thing as they see it. I hope that some more regular opportunity

to meet with the minister responsible will assist them in better

understanding ways in which they can let the public know where they've

come from, where they're at and where they're going.

Frankly,

I would agree with the member that the Vancouver Stock Exchange has not

done as much as it might in telling its story, particularly because

there's a very good story there to be told, in terms of the internal

improvements made over the last several years. As the member probably

knows, the exchange is moving to spanking new quarters in the fall. I

think there's a very exciting story to be told as to the move and the

reason for it. I was interested by the member's remarks, because I've

suggested recently to the governors that the exchange could usefully do

for all members what a number of groups do once a year while we're in

session: take an evening, have us over together, offer us dinner and

give us a little presentation as to what's happening at the exchange —

a useful question-and-answer session and so forth. The governors I've

talked to most certainly indicate not only a willingness, but a keen

desire to upgrade their public-information processing. I think it's a

good and timely suggestion by the member. I think the exchange is going

to be moving in that direction of its own volition.

Certainly,

in terms of the development of a unique venture capital market based in

Vancouver, that's a very obvious goal of the Vancouver Stock Exchange

and its leading members. One of the reasons why I think we're all

concerned about efforts to, for example, speed up the processing time

for statements of material facts and prospectuses is that there is

competition from other geographic areas to be the home for this kind of

unique venture capital market. My impression is that the province of

Ontario now realizes that it missed the boat somewhat several years

ago. It is about to launch a major new initiative to bring back to the

Toronto exchange some of the quite legitimate junior resource or

venture capital business which has been lured here. That, I think,

means that the exchange, the securities industry in B.C. and this

ministry have to gird their competitive loins and see that things are

happening here in a prompt and efficient way, so that people are going

to stay and choose to do legitimate business here.

In terms

of surveillance, frankly, my view is that Rupert Bullock moved with

considerable dispatch on the BCRIC matter. I think that the appointment

of Leon Getz speaks volumes for the obvious concern the government had

in having a first rate report done by a person with impeccable

credentials who is also one of the senior specialists in the country in

this area. I think that the appointment of Leon Getz reflects the

importance attached to the inquiry by the government. In my experience,

Rupert Bullock comes from a very experienced and senior police

background. He's very independent, as he should be, in his approach. I

think he is conscientious to a T, and very mindful of the down side of

delay. For that reason, my view is that he moved with dispatch on the

BCRIC matter and will move as rapidly as practical on any

investigations he undertakes.

Certainly there is a time lag

between the commencement of an inquiry and the matter ultimately being

heard in court, if it goes that far. I think it's not the case that on

average it is a six-year time-frame. It is doubtless the case that in

these matters, particularly if there are so-called bad guys out there

and they have tried consciously to cover their tracks and do things

with an end run.... In those situations it probably is a 6- to 18-month

time-frame in terms of the research and investigation, where you have

to thread back and fill in blanks, very often working in other parts of

the country. Once that year or year-and-a-half process is done and the

legal opinions are obtained, I think on average we're faced with a

court calendar wait somewhere in the neighbourhood of a year. So I

think a two- to three-year time-frame is more practical. It seems to be

a fact of life. Although there may not be the immediate salutary effect

of an investigation started on day one and a conviction on day three,

nonetheless, for whoever is around listening and watching when a

conviction comes through, I think there is a very salutary effect.

terms of statements of material facts, we have a hardworking staff. The

volume is up incredibly. That's the reason why we haven't been able to

shorten that time-frame. We're working now on efforts to make that

time-frame shorter. Mr. Chairman, you're well aware of the concern of

many of our MLAs to have those prospectuses and SMFs vetted and

approved in a shorter time.

I think that touches the major

items raised. Regarding the various reports which for years, recent and

before, have not been released, I'm aware of the member's concern. I

have not read all the reports. I'm through most of them now. I'm aware

of his concern, but I can’t give any commitments today.

MR. LEVI:

I'm devastated. I know that if the first member for Surrey (Hon. Mr.

Vander Zalm) was in that department, he'd release the report. My gosh,

we're not going to get to look at the report.

Now we're going to talk about staff, statements of material fact and what the heck is going on down there.

Don't give Mr. Bullock a hard time, because I'm going to quote you from the Province of March 18, 1981. It says:

"The provincial budget for 1981-82 provides for an increase

in personnel in the office of the superintendent of brokers. Insurance and

real estate to 82 from the previous year's 64. The increase is more apparent

than real, however. Superintendent Rupert Bullock's staff already totals

approximately 80"— because they have auxiliaries — "and the authorized increase simply means that personnel

employed on an auxiliary basis will be taken onto permanent staff."

Here's

a quote from the superintendent: "We are in serious need of more staff,

and I will be drawing the attention of the ministry" — Consumer and

Corporate Affairs — "to the drastic situation."

"There is a particular need for accountants in the securities side

of his office, he said." As a matter of fact, he recently made a

statement which was almost in the frame-

[ Page 5420 ]

work

of a warning to accountants, that they better get on the ball about

what they're doing when they're working for some of these companies,

because some of the stuff that's coming down the pipe is not very

satisfactory. One might give the same warning to some of the lawyers

who are involved too. There is a particular need for accountants in the

security side of his office, he said.

"'I'm

not just talking about one or two people. We need between 10 and 20

more. My staff is processing up to 250 prospectuses, statements of

material facts and other documents at a time, and it takes about three

months to get one processed. That is totally unacceptable when we're

aiming for a turnaround time of ten working days.'

"Each

accountant in the superintendent's office works on about 25 documents

at a time. Their counterparts in the Ontario and Alberta securities

commissions have to handle about eight at a time, Bullock said.

sharply increased volume of new listings and financings on the

Vancouver Stock Exchange has contributed largely to the growing

workload in the superintendent's office. A recently implemented policy

which broadens the number of offerings that may be exempted from

registration under

section 55 of the Securities Act has helped in

eliminating some work, Bullock said."

Then he talks about the estimates.

The

minister has made mention of the impact in the province of the

expansion in the operations of the stock market. Those people who have

a major concern about the market have seen a dramatic increase. The

market, in terms of volume, sits second to Toronto; and if Toronto

doesn't get moving, it's going to be second and Vancouver is going to

be first. But there is an inherent danger in this kind of progress. I

think it's implicit in what the superintendent is talking about. They

urgently need accountants. Somebody has to vet these statements of

material fact and the prospectuses. It's important. We've seen what has

happened in the past. If ever there was fertile territory for people to

come in and do a ripoff scam it's here, because of the rapid expansion

and the failure to increase the staff of the very surveillance group

that is the first line of defence. If they miss something and it gets

out to the market, they're in trouble and the investors are also in

trouble.

I've been watching the performance — that's what I

think you might call it — of what's going on in relation to that

company, New Cinch. I'm still not sure where we are with that. I'm

always at a loss to understand.... I don't want to get into the

business of upsetting investors. There are certain specific unanswered

questions in that particular case. For some reason it's still trading.

There are all sorts of suggestions.

The point is: what can

you do about that? You're always going to get companies that get into

trouble. I'm not suggesting that all companies set out to rip people

off. Occasionally some get into trouble very legitimately. The object

of the surveillance

section that the minister has is to spot some of

these things in terms of the way that the statement of material fact is

drawn and the way the accounting is set up. They have to deal with this

all the time, but they're under a great deal of pressure. The

turnaround time is bad, and of course the turnaround time directly

affects the capability of more investment. If it takes too long, people

are going to say: "My God, this is worse than dealing with the

municipality that I'm taking on." And, of course, you're under the gun;

there is a great deal of competition.

Under vote 47 that

department has a budget of $5,865,797. I want to ask the minister a

question specifically related to the item in the budget under code 40,

advertising and publications. That has gone from $106,400 to $215,982.

What does it all mean? On the one hand, you have the man in charge of a

very busy division of Corporate Affairs, the superintendent of brokers,

insurance and real estate, who can't get enough money to get staff. And

here we have a budget item which represents an increase of $109,000.

What is it used for?

I think I should sit down so that the

minister can answer some of the questions I've asked him. Then we can

wind up with this one.

MR. STRACHAN: I wonder if I might have leave to make an introduction.

Leave granted.

MR. STRACHAN:

Mr. Chairman and Members of the Legislative Assembly, I am pleased to

announce that in the galleries today and visiting the precincts this

afternoon are students from the Beaverly elementary school in Prince

George. They are chaperoned by Irene Peters, Joanne Haggstrom, Barb

Temoin, Cheryl Hughes and Dale Andrews. I'd ask the members to give

them a nice, warm Victoria welcome.

HON. MR. HYNDMAN:

Vote (40) and its increase are again a consequence of the highly

increased volume of commercial activity in the province and the

consequent high increase in the volume of incorporations, corporate

resolution passages, statements of material facts, prospectuses and so

forth. There are two main elements to this vote, and the vote doesn't

really deal with advertising and publications in the normal sense.

First

under this vote, the weekly

summary put out by the superintendent of

brokers, insurance and real estate is produced. As the content of that

weekly

summary has increased through the rapidly escalating pace of

economic activity in B.C., and as the demand for the publication has

increased, costs have risen, and of the $109,582 increase about $21,000

is on account of increased production costs of that weekly

summary. The

balance represents the costs of gazetting in the British Columbia Gazette

as well as related Queen's Printer fees, again relative to the kinds of

things which the ministry must publish in connection with

incorporations, capital reorganizations, statements of material facts,

investment processing and so forth. Owing to an increased volume of

gazetting requirements and increased fees charged by the Queen's

Printer for those, the increase is expected to be $88,582. Those are

the two elements of that vote and the reasons for the two projected

increases.

[Mr. Strachan in the chair.)

MR. LEVI:

In November 1979 there was a commercial crime seminar in Vancouver, and

Mr. Scott, the president of the Vancouver stock exchange, made a

presentation. He said, in part, that if there ever was an opportunity

for organized crime to enter into a field it was in the stock market.

After all,

[ Page 5421 ]

their

greatest need is to launder money. There are figures published by the

Solicitor-General's department which relate to the amount of ripoff

that exists in these various stock markets. For instance, it was

estimated in 1977-78 that some $50 million was ripped out of the

markets because of a variety of scams or whatever.

Let me

ask the minister — without revealing too many state secrets — because

it probably is a major preoccupation or one of the preoccupations of

CLEU.... I ask this question because we have, and have had for years,

the largest drug operations in Canada. The figure is way up from $250

million now; it's much further up than that. Then there's the whole

question of where the money goes. I have tried on a number of

occasions, with one of the minister's colleagues, to get him to have

some real concern about exactly what goes on with his money. The

Montreal people examined this question. The Quebec Crime Commission

examined it. They even went to the stage of publishing a report and

making a series of recommendations about how one might curb this or at

least take notice of what's going on and utilize the federal revenue

department to do something about it.

What I'm saying to the

minister is this: we have a very large operation in the stock market at

the moment. It's just ballooned into an incredibly large operation. One

of the major concerns has to be: who are the people coming into the

market, and what kind of money is coming into the market? I gather from

a recent

article that we get about 40 to 45 percent of the new

investment coming from Europe — Germany, Great Britain. But we also

have investment coming from places like Panama, the Bahamas, you name

it — places that have chequing accounts with strange numbers, which

will only give cash to people who know the numbers.

This

particular problem, which is a continuing problem, has to reinforce the

argument I made earlier and which the superintendent made, about having

enough people to do the checking. If that isn't provided now, sooner or

later we could head for one great big scandal here. It can happen.

Frankly, I am not happy with the position the government takes on

organized crime. The former Attorney-General, who is now Minister of

Intergovernmental Relations (Hon Mr. Gardom), said: "Well, things

aren't bad enough to have a real inquiry." That's what he implied in

this House in 1978. Well, that's very nice. You wait for the brick to

fall on you to find out whether the mortar's loose. It's a serious

problem. You have your senior official saying he needs more staff in

just the general run of the business, plus the fact that if you're

going to do a real job of surveillance and understanding in that market

you've got to go further and be concerned about where the money comes

from. It's the same in the real estate business.

With all

the constant debate we have, particularly about rents and who owns the

buildings and who owns the land, we have yet to get any definitive

statements from anybody on just how much foreign investment there is in

real estate, for instance; or how much investment there is and where it

comes from. These things have to concern somebody. It's something about

which generally no concern at all has been expressed by the government.

No answers have been given. I know that sometimes one answer given is:

"We are looking at it, be assured. Now go away and leave us alone." But

it's much more serious than that. We've had a bit of a history of it in

the real estate business and the stock market.

One of your

officials is in a continuing hot-spot situation: he's on the griddle

every day. He has 400 to 500 companies trading on the market, and he

doesn't know what's going to blow up next. If he hasn't got the correct

number of staff, he's going to have trouble, investors are going to

have trouble, and the whole industry is going to have a black eye.

Black eyes are not new to the industry.

The president of the

stock exchange made a very interesting observation when he talked about

the cooperation between his division and the RCMP. He said: "Of course

there will always be occasions where an attempt is made to give false

or misleading information even in writing. We cannot stop all these,

but with the advice of our professional staff and outside experts

available to us, we can and do sometimes require that the company

statement be verified from an outside expert." At about the same time

he wrote that, this exchange took on a mining engineer. That was one

positive addition. "In conjunction with the forces available to us,

through the cooperation of the RCM Police and the superintendent of

brokers' office, it works reasonably well."

A lot of money

is spent on surveillance. However, there are still problems. The basic

problem appears to be the staff. The minister hasn't really addressed

that question. I've asked him before. Mr. Bullock has expressed very

serious concerns about this. In my opinion. the market is going to

continue to blossom, unless the Ontario people can turn everything

around. I don't know whether that can happen. After all, now we've got

four western provinces that would prefer to operate out of the west

rather than the east. Maybe that's very valuable for us in terms of

that market. But it's a problem, and I can't say it too strongly. I

haven't heard from the minister about the business of staff and his

concern about surveillance.

I want to move on to one other

area. About four years ago we had a White Paper on co-ops, which went

the way of all White Papers: we never saw it again. It was distributed.

There was some suggestion that we might get some legislation, but we

didn't get any. Let's leave out the legislation for a moment. There are

an increasing number of co-ops. I've had quite a bit to do with two or

three co-ops in and around my riding, one of which is the largest

housing co-op west of Toronto; it has five buildings, made up of about

260 units. From an educational point of view there hasn't ever been any

focus on co-ops, as far as I know. Part of the minister's other

responsibilities, and one which we dealt with earlier about housing and

rentals.... We haven't actually debated affordable housing, but one of

the mechanisms, obviously, is co-op housing, and this is a valuable

mechanism. The general thing is that this knowledge is somewhat

specialized, and relates only to a rather interesting group of people

who I might characterize like this: they are usually middle-class, very

bright, community-conscious people. What I'm saying is that the concept

of co-op housing doesn't reach the average Joe.

It's a

question of whether you want to expand co-ops in general, whether

you're talking about user co-ops for food, co-op stores, co-op housing

or co-op mobile homes. The government has yet to express any philosophy

or policy on this. We have some idea of the importance they attached to

it up until about a year ago, because the White Paper was never

proceeded with. We have in this province a large number of people who I

believe would respond to the idea of the co-op movement, if that's what

the government policy is. We have a large number of people who are from

the Prairies, who have been exposed to all types of co-ops, and yet in

the one area that the minister and his colleague the Minister of Housing

[ Page 5422 ]

(Hon.

Mr. Chabot) have to do with, there is some small, important work going

on, but it's not going on under the aegis of the government. Neither is

there enough money for those people who are doing it now.

Where

is the government in terms of co-op philosophy? What have they in mind?

What are the minister's views on this? One of the very serious areas in

terms of affordable housing relates to mobile homes, and some of those

people are in co-ops. The question is: how does the minister view this?

How does he see the function of his superintendent of co-ops and trust

companies? That's an interesting combination — co-ops and trust

companies. That's like putting J.P. Morgan with a piggy-bank — anyway,

he's responsible for those two areas. What's the minister got in mind?

One of the things which is a major concern to him is affordable

accommodation. One aspect of this is co-op housing. What are they

prepared to do about it? I don't think they've done anything. Nothing

has happened. You have a superintendent of co-ops who's a member with

very broad experience in other countries in terms of organizing, but we

don't have any focus at all at the moment in respect to co-ops.

want to deal for a moment with two things in relation to real estate.

If we ever had an exposure of the real estate industry, it has been in

the last year, with the incredible increase in the price of housing. A

number of remarks have been made. I received a copy of a letter the

other day from one individual who is a real estate man who said that

today, if you want to function as a real estate licensed person, and

you can't sell three houses that will gain you commissions of $20,000,

it's darned difficult to be in the industry. Yet the industry, in terms

of the number of agents, just grows and grows and grows. It's free

enterprise gone mad. Everybody can get into the industry.

Some

years ago there was a report, the Rosenbluth report, which made a

number of recommendations. That one might be out of date, as it's six

years old, but that industry needs to be looked at. It's got to be

looked at for two reasons. One is that we have a different kind of

housing market out there. I don't know whether the housing market will

settle back into the staid old ways we knew. I doubt it very much. I

think that we're always going to have an incredible amount of pressure

on that industry. That's the general pressure — the business of finding

houses, or the business of competing to get houses from a large number

of agents. They have an issue around the commissions. But then there's

another group out there looming quite large, some of them very

legitimate in their aspirations, some of them quite illegitimate in

their aspirations. I have in mind the option people. There appear to be

some people who are very serious about offering this as a legitimate

alternative given that it can fit into some realistic legal framework,

and there are other people who are really going around piggybacking on

what is a very volatile real estate market. Some people are getting

hurt.

It's not a question of government involvement or

regulation in the first instance. I personally believe — I said this at

the time they brought the Motor Dealer Act and Travel Agents Act in —

that if those industries would have regulated themselves in the proper

way, they wouldn't be in the position of having the government do it

for them and then constantly complaining about the fact that the

government is up to its hips in their industry. Just about every

citizen in this province at one time or another is going to be touched

by the real estate industry. If we take the national figures,

somebody's moving every five years. It's a very volatile industry in

terms of the price of housing and the availability of accommodation,

but it's becoming more volatile because they've been offered some

competition. Whether the competition is legitimate or not, we don't

know. Somebody has to look to see whether the game that's being played

there by the option people is fair. At the same time they have to look

at whether the real estate industry itself, in terms of the large

number of people who want to get into it and are in it.... People

queued all night to get 200 positions at UBC. I think there were 900

people that applied.

In the interests of the consumers — the

citizens — somebody has to say to the industry: "This thing cannot get

out of hand. You have an industry that has to function. Pe

Document details

CollectionBritish Columbia — Debates (Hansard)
Citation32p 03s 810505p
Typehansard
Volume / chapter32p 03s 810505p
Languageen
Formathtm
SourcePROVINCIAL
Identifierb82ea0bf7dd318f06210cf6ce99eced8c10d4c48

Source file is stored in the law ingest library (htm).