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