1993 Legislative Session: 2nd Session, 35th 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, JUNE 1, 1993

Afternoon Sitting

Volume 10, Number 16

[ Page 6737 ]

The House met at 2:05 p.m.

C. Serwa: Joining us today is a very special individual who has travelled all the way from the Kootenays -- a former Social Credit member representing the Kootenay area. He is here as a former Minister of Labour, altogether too willing to give advice to the present Minister of Labour. Would the House please make Terry Segarty welcome.

Introduction of Bills

FOREST AMENDMENT ACT, 1993

Hon. D. Miller presented a message from His Honour the Lieutenant-Governor: a bill intituled Forest Amendment Act, 1993.

The act introduces changes to the woodlot licence program which allow flexibility to change the boundary or size of a woodlot licence, increase fairness in the awarding of new woodlot licences and allow for greater equality in allowable timber harvest volumes between coastal and interior woodlot licences.

The act introduces amendments to help the Forest Service protect the financial interests of the Crown by strengthening controls over the scaling of timber and improving the ability of the Forest Service to collect moneys owing to the Crown.

Finally, the act introduces housekeeping amendments to clarify the intent of some sections of the Forest Act. Bill 30 helps fulfil this government's commitment to better management of our province's forest resources.

Bill 30 introduced, read a first time and ordered to be placed on orders of the day for second reading at the next sitting of the House after today.

LABOUR RELATIONS CODE ADVISORY COMMITTEE ACT

G. Farrell-Collins presented a bill intituled Labour Relations Code Advisory Committee Act.

G. Farrell-Collins: This bill will require the minister to immediately establish an advisory committee under

section 3 of the Labour Relations Code. This committee will aid the minister in reviewing the Labour Relations Code by making recommendations to the Legislature and the minister with regard to the impact, effectiveness and problems of the new labour code, resulting in a more practical and effective labour relations climate in the province to better serve all British Columbians, including students.

Bill M221 introduced, read a first time and ordered to be placed on orders of the day for second reading at the next sitting of the House after today.

Oral Questions

WELFARE FRAUD

A. Cowie: A question to the Minister of Social Services. A private investigator has uncovered a scam for getting fraudulent birth certificates. These enable persons to receive numerous welfare cheques. The minister is obviously aware of this. What is the minister doing about it?

Hon. J. Smallwood: For the member's information, we have been working with the Attorney General, who in turn is working with CLEU and also Interpol, because the whole issue of counterfeit identification is one that is hitting all systems, ours included.

A. Cowie: Again to the minister. This fraud is costing millions and has for the last number of months. Much of this fraud can be stopped by photo ID similar to the common driver's licence. This has been done in Quebec. Will the minister provide those people requesting social assistance with proper ID similar to the driver's licence, so the people requiring assistance can get it and the money doesn't go to the fraud artists?

Hon. J. Smallwood: I'm going to say one more time that this is an issue that is of concern to all financial institutions, ours included. The concern that we have has been highlighted by the additional resources that we have put in place: additional fraud investigators and a specialized team to deal with sophisticated fraud. That is what we're talking about, hon. member -- sophisticated fraud. Counterfeit documents, whether they are birth certificates or picture ID, are of concern to the Attorney General, to CLEU and to Interpol. All of those senior agencies are working to tackle this problem.

A. Cowie: Again to the Minister of Social Services. Surely the minister can get real. In Quebec all they have is ID similar to drivers' licences, and it has cut down the fraud by 50 percent. You don't need any more advice than that to save millions. When will the minister get on with it?

Hon. J. Smallwood: We require two pieces of identification in our ministry: a social insurance number and a second piece of identification. In areas where there is significant concern, a financial assistance worker is supported and encouraged in requiring additional pieces of identification to address those concerns. The issue, I reiterate, is one of sophisticated fraud. It is of concern to all systems. We are working with all agencies in trying to tackle this problem.

[ Page 6738 ]

PREMIER'S ROLE IN DEALING WITH LABOUR DISRUPTIONS IN SCHOOLS

W. Hurd: My question is for the Premier. The Premier has still not given the people of the province an explanation in this assembly as to why he exempted himself from cabinet meetings in which the settlement of the Vancouver teachers' strike was addressed. Can the Premier tell us exactly when he exempted himself from cabinet meetings on the Vancouver school strike and why he waited so long to get a ruling from conflict-of-interest commissioner Ted Hughes?

The Speaker: Before I invite the Premier to answer, I would caution all members on both sides of the House about the guideline in 47A, and that the proceedings of cabinet meetings are not acceptable subjects for question period. With that guideline, I will invite the Premier to answer and ask him to keep those limits in mind.

Hon. M. Harcourt: Thank you, hon. Speaker. I dealt with that question yesterday. Secondly, if the member needs further information, I will take his question on notice and supply what further information I can supply, having due regard for the confidentiality oath that I swore when I entered cabinet.

The Speaker: I will invite a supplemental, asking also the hon. member for Surrey-White Rock to keep in mind the guidelines of question period regarding cabinet matters.

W. Hurd: Then perhaps I can ask the Premier a question of principle. Does the Premier really expect the people of the province to have confidence in a Premier who exempts himself from cabinet meetings, for whatever reason, without an adequate explanation of why he should leave the cabinet -- the executive council -- without a functioning Premier? Is this the Premier's definition of leadership?

L. Hanson: My question is to the Premier, too. By dodging his duties in cabinet under the pretext of a possible conflict of interest, the Premier has confirmed what most British Columbians already suspected: that he's only a part-time Premier. Is the fact that he's a part-time Premier the reason he took a 5 percent wage decrease?

[2:15]

The Speaker: I would remind the hon. member that presence in or absence from cabinet is not in itself a matter for question period. Members need to frame their questions carefully.

L. Hanson: Thank you, hon. Speaker. I suspect that most taxpayers in B.C. would prefer that the Premier base his pay on the number of promises he has kept. He probably wouldn't be getting anything.

If the Premier felt that he needed Mr. Hughes's permission to sit in cabinet, why did he wait 19 months? Didn't the Premier anticipate that his government would likely have to deal with the issue of putting teachers back to work in the case of a strike?

The Speaker: The hon. member for Okanagan-Vernon has a third question?

L. Hanson: One final supplemental, hon. Speaker. I'd like to ask the Premier how many other ministers are going to bail out of their responsibilities, as we've seen in this case. Which of the other ministers are unable to do their job? Is the Premier satisfied?

The Speaker: Order, please, hon. member. I am going to disallow that question. I have already reminded hon. members about the limits of question period on this topic.

NON-PROFIT ADOPTION AGENCIES

V. Anderson: My question is to the Minister of Social Services. Last week a national study was reported as supporting non-profit adoption agencies. The minister was reported as saying that she now also supports non-profit adoption agencies in B.C. Will she confirm that statement for us here in the House?

Hon. J. Smallwood: The reporter who wrote that story in the first place asked me twice whether my position had changed. The answer to her, twice, was no. Regrettably, on subsequent occasions the editorial page carried editorials on that same topic. The editorial department has a letter from me clarifying and challenging that misquote, and have made a commitment to run a disclaimer. The information and the quote from the paper that you have are incorrect. We continue to work to develop adoption policies for the province. Any debate around this issue will have to take place when that legislation is tabled in the House.

The Speaker: Supplemental, hon. member.

V. Anderson: The confusion engendered by this has, nevertheless, caused a great deal of uncertainty in the province, even more than we had before. Besides writing to the paper, will the minister make a public statement explaining why and on what basis she goes against the national study? Will she please explain why her wisdom is greater than the national study?

Hon. J. Smallwood: I think it's regrettable that the member chooses to quote a single line out of the national study. The national study that has been concluded and made public -- two years work by those authors -- is extensive, and to a considerable extent supports the work that we currently have underway in this province around adoption policy. I'm very pleased by that fact.

As for the disclaimer, it is my hope that the newspaper publishes that disclaimer, as they have agreed to do.

[ Page 6739 ]

NANAIMO COMMONWEALTH HOLDING SOCIETY

L. Fox: My question this afternoon is for the Attorney General. It has been well over a year since Mr. Henderson was appointed to investigate the Nanaimo Commonwealth Holding Society scandal. Has the Attorney General had any status reports from either Mr. Henderson or his staff, or does he have any idea as to why this investigation is taking so long?

Hon. C. Gabelmann: The answer to the first part of the question is no.

L. Fox: Is the Attorney General confident that Mr. Henderson will have completed his investigation prior to the end of this legislative session? Has he or any of his staff asked Mr. Henderson for an update on the investigation?

Hon. C. Gabelmann: In respect of the first part of the question, I have no idea; in response to the second part, no.

L. Fox: Does the Attorney General have any specific knowledge or reason to suspect that any members of cabinet are implicated in Mr. Henderson's investigation?

The Speaker: Hon. member, that appears to be a very hypothetical question.

Interjection.

The Speaker: Order, please. Ministers can answer for their administrative responsibility. If the Attorney General chooses to do so, I would caution him not to address the hypothetical portion of it.

Hon. C. Gabelmann: If that member or other members want to know how the process works, I would recommend they read the Owen report of about four years ago.

THREE GORGES PROJECT

D. Jarvis: My question is to the Premier. A British Columbia Hydro representative stated yesterday that Hydro has no current involvement in the Three Gorges project. Can the Premier confirm that Hydro is not part of the Canadian consortium that is seeking a contract with that project and that it is no way involved?

Hon. M. Harcourt: The minister responsible, the Minister of Labour, is not here today. But I can say that B.C. Hydro is part of a consortium of other utilities in Canada and SNC-Lavalin that is looking at hydro needs in China. One of the projects that was being reviewed in terms of feasibility was the Three Gorges project. That was terminated in 1989 as part of Canadian government policy because of Tiananmen Square. I can say that no decision, as I understand it, has been arrived at on hydro projects in China. But if the member is interested, there are some other hydro activities in China in which B.C. Hydro is involved with consortia.

The Speaker: Supplemental, hon. member.

D. Jarvis: The Premier is on record in this House as saying that the Chinese government has addressed all the concerns involving it with regard to this project. The Environment minister denied any knowledge of the issue when I asked him about the situation several weeks ago. He was completely unaware of it. To the Environment minister, are you now aware of the issue, and are you satisfied that all ecological concerns are being addressed?

Hon. J. Cashore: It's rather interesting that after the fall session and into the spring session, the third question we get in question period on the environment is not about the environment in British Columbia but about the environment in China.

Interjections.

The Speaker: Order, please. I would call the House to order so that the minister can address the question. Please proceed, hon. minister.

Hon. J. Cashore: Hon. Speaker, if I am cautious in answering this question, that is my intent. I think we have to be very cautious about being paternalistic with regard to our decision about what should happen in another country. There are significant environmental concerns about this project. There are also significant environmental concerns about the alternatives, given the nature of the coal in China, and I think we have to be very cognizant of that. I don't think it helps us internationally to sit here, as the Liberal opposition has done, and pronounce what is morally right with regard to another country without having had the appropriateness of being fully cognizant of all the issues.

B.C. GAS AND B.C. HEALTH SERVICES LTD.

Hon. A. Edwards: In response to a question asked on May 27 by the member for Richmond East, I would like to clarify for other members of the House that B.C. Health Services Ltd. is a hospital purchasing group and a wholly owned subsidiary of the B.C. Health Association. Commonly called BCHSL, this company filed a complaint regarding the basic charge in B.C. Gas's proposed interruptible and transportation rate schedules. Those schedules are fairly complex. They are being put forward by B.C. Gas in the rate design hearing before the Utilities Commission on July 5, 1993. BCHSL is an intervener at the hearing.

Their complaint will be heard and dealt with by the Utilities Commission. Of course, every other interested party, including any citizen or MLA, is free as well to intervene at the hearing and represent their interests.

I would be pleased to give further information to the member about the proposals.

[ Page 6740 ]

A. Cowie: Hon. Speaker, I request permission to table the UTV expos� of welfare fraud.

Leave granted.

Orders of the Day

Hon. C. Gabelmann: Hon. Speaker, I call both sections of Committee of Supply. It is my understanding that Committee B will be doing the estimates of the Ministry of Environment, Lands and Parks as soon as it has finished Economic Development.

[2:30]

The House in Committee of Supply B; R. Kasper in the chair.

ESTIMATES: MINISTRY OF ECONOMIC DEVELOPMENT, SMALL BUSINESS AND TRADE

(continued)

On vote 23: minister's office, $347,800 (continued).

L. Fox: I want to get back on the topic that I started just prior to lunch. I spoke to the minister about job creation impacts being different in different sections of the province, and I related to him some stats from last year. I wonder if he has any specifics on what he perceives the regional impacts will be for the upcoming year. From his perspective, will we be continuing to see growth that sees the bulk of the new jobs created in the lower mainland region? Are there significant impacts similar to that of last year in the other regions of the province being estimated by his ministry?

Hon. D. Zirnhelt: I think the results of the improved prices in lumber will help in some of the interior towns. I think that industries that are still under stress -- like minerals -- will probably not see a great increase; it would be nice to change that.

We will expect ongoing growth in the urban areas. I don't think there's any question that urban areas like Vancouver, the lower and upper Island areas and places like the North Okanagan will continue to grow. I think there will still be an expansion in the larger centres in the rural areas where there might be an overall decrease in employment. It is my understanding -- having looked at some of the materials -- that some of the larger cities now have quite a bit of growth.

A pleasantly surprising experience is the way in which a small town like Clinton -- I'm sure you've driven through Clinton -- which has struggled to maintain its population size, has experienced quite a bit of growth over two or three months.

We are seeing a return of employment in a lot of the rural areas of the province, but we have redirected our resources and tried to focus on those areas. I often talk about trying to help communities to stabilize their job base.

L. Fox: I thank the minister for his answer. I am sure that Clinton is probably feeling some spinoff from the pressure in the Fraser Valley and so on, and we are looking at some growth there.

My concern is that there are many regions of the province where the opportunities are not the same for small business and job creation as they are in the urban centres of the province. I wanted to ask specifically what this ministry was doing, first, to understand the extent of the problem, and second, to come up with some direction as to how his government might improve the climate in order to encourage investment in those areas that are not growing and are very important to the economy of British Columbia.

Hon. D. Zirnhelt: We are continually trying to refine our understanding of what's happening in the regions. As a result, we work closely with the Ministry of Finance to put out reports. I'm sure you've seen those reports with the indicators in them.

Interjection.

Hon. D. Zirnhelt: Well, averages within the.... There's always change, and to come up with some generalizations that apply in all places is difficult. The whole reason we fund the local economic development program is so that people who understand the local situation can help analyze what's going on in their own communities. We are continually monitoring what is affecting the growth and development of industries. For example, we know that there is growth potential in the value-added wood industry. As a result, we look at employment in that area and the conditions under which those kinds of industries thrive.

We are doing that continually. It's not just the provincial government; the local economic development commissions also do that. We provide to them aggregated information for a region -- averages and so on -- and they know what's happening in their communities. To develop the data that you're talking about would require resources well beyond those of this government or of any government.

L. Fox: I'm rather disappointed with the minister's response, because I don't think it would take a whole lot of effort to gather those kinds of data. The minister suggests the economic development commission of an area will help to provide that kind of information. I have to suggest -- and if the minister were well aware of the economic development issues in the province, I'm sure he would recognize -- that the only areas that have economic development commissions are large urban areas. Many small, single-resource communities don't have such a structure. Their driving force is their elected municipal people; they don't have economic development commissions.

I had hoped that the minister might have gotten into a concept plan. He told us earlier that we now have 24 regional economic development officers in 22 different regions. I had hoped that he would have used this as a tool and outlined the kind of programming these people were going to do in order to enhance economic development in specific regions, rather than using averages produced by the Ministry of Finance for setting global policy.

[ Page 6741 ]

Hon. D. Zirnhelt: I think I misunderstood what you were saying. When you talk about studies or analyses, you must realize that you can spend $20,000 in a particular community and still not have all the data you want. But the people in the field are continually trying to analyze the general data and how it applies.

Since I understand where you're questioning is going, I'll give you some of the activities that the regional economic development officers are supposed to undertake. You're right -- and I've often said in the House -- that these people are there to provide services to those communities that don't have them. We have tripled the number of people in the field; and when they're in place, they will be able to assist those communities that don't have local economic development commissions.

They have to work with those as well, because as you've correctly said, there is spinoff to smaller communities from some of the larger ones that do have economic development commissions. The communities that aren't large enough -- and I would use the example of Valemount, which has minimal funding -- will get additional services from one of the REDOs who's working in Prince George. The people in Vanderhoof can work with the smaller communities around it to the extent they need some economic planning.

The REDOs will do strategic planning in any community to the extent that they have the time, but I expect they will be able to help every community in their area. They will be working at developing the capacity of the community itself to form community development, adjustment and strategic planning initiatives; and identifying program needs -- if the problem has been analyzed -- in order to deliver existing ministry programs. They will work with the various agencies that have an impact on economic development in the communities and try to pull them together.

I could give lots of examples of what the ministry staff has done in those that are in place. For example, there's a project coming up on June 12 in the Comox Valley where the REDO will be helping the community, including economic development agencies and planning groups, develop a community vision. It's a result of the visit to the community that I made some time ago. I initiated talks between the people in Economic Development and Social Services. There are lots of examples of them doing that work.

L. Fox: I guess I was looking for a little more proactive planning from the minister on how we were going to diversify the economies, because so many of the rural communities are single-industry towns. They survive on either the forest industry or the mining industry. Very few of them have the privilege of having a diversified economy which allows them to be part of more than just one industry. However, I'll leave that for right now.

In reading the Blues, I noticed that in your budget you have an industrial incentive fund of $40 million. There was some discussion on that yesterday. Out of this, the question that again came to mind was the Vanderhoof Pulp and Paper initiative. If the infrastructure needs were going to be met, would it have to come out of that specific fund, or are there other funds available for those purposes?

Hon. D. Zirnhelt: It would only if there was a loan or an investment by the government in it; but infrastructure, no.

L. Fox: Thank you. So this particular fund is for loans or an investment to be paid back to government at some point at a later date? Okay.

I had one other question in my mind. Recently in Parliament in Ottawa, there was a patent protection act passed. During that debate, the drug companies made a commitment to look at B.C. and other provinces to expand their research and development. As I understand it, last year there was only $3 million spent in British Columbia. Given the commitment made by the pharmaceutical companies, what action has this ministry taken to encourage those pharmaceutical companies to invest some of those committed dollars in British Columbia, versus other provinces?

Hon. D. Zirnhelt: You have chosen an area in which we share responsibility with Health, to a certain extent, but also Advanced Education.

Interjection.

Hon. D. Zirnhelt: Well, everything is a small business. You could say that therefore we're responsible for everything in agriculture and in forestry. As I've explained time and time again, where there is a ministry that has a lead role, we assist that ministry. This ministry has shown the pharmaceutical companies what strengths there are to operating in the economic environment here in British Columbia. We have worked with the Ministry of Advanced Education, Training and Technology on that and helped to articulate the strengths of the biomedical research capacities at UBC and in the province.

L. Fox: Just to follow up on that so I can be sure as to the action, would the minister like to give me a point-by-point action plan that has been conducted so I would know to what extent you are trying to invite.... It's a great opportunity, in my view. I specifically know of two companies that are looking to invest in British Columbia, in this particular area. They are, however, somewhat concerned because of the taxing policies of this government. I would like to know what action is planned. It specifically falls within your ministry, because it falls in the investment area.

My understanding is that something like $10 million in new investment is available for this specific purpose in 1993. So I want to know what specific plan you have, as the Minister of Economic Development, to try to encourage that money into our economy.

[2:45]

Hon. D. Zirnhelt: We have people working in this field who are meeting with the companies and other agencies like the Advanced Education ministry and the research establishments at UBC. Merck Frosst,

[ Page 6742 ]

for example, has announced its intention to establish at UBC, and invest, I believe, some $15 million if the province invests a similar amount in the building. But we are not at all convinced that having made the efforts to get them here that the benefits outweigh the costs of that particular legislation. The increased costs to this government for drugs is a major concern to us. You rightly point out that as an offset to that we're supposed to see investment in this province. But there's already a critical mass of investment in this field in the province of Quebec, and they're fighting hard to establish it.

One of the problems we have is to get to the critical mass here, and we have continually argued with the federal government that as a result of their legislation it's absolutely essential that they assist us to establish an industry here.

Specifically, what we're doing is meeting with them and providing them with the information about the advantages of operating here. I know of no public comment, by any of these companies, about their concerns about a specific tax policy. I would be happy to address that if we were to get any.

L. Fox: First of all, I never suggested that any of them made any public comment. I suggested that I had spoken to two of them.

Secondly, while I respect what the minister is saying, the fact of the matter is the impact is there in the way of costs, whether we like it or not, because the legislation is passed. If we're going to reduce the impact of that and if we believe there are more costs, then we should be out there literally selling British Columbia as an opportunity for research and development for these companies. We shouldn't be sitting back and waiting for them to contact us. We should be literally going out there and soliciting those companies that we know are in a position to invest R and D money in Canada in the next year.

My final question -- or a series of questions -- is around Build B.C. What kinds of dollars does your ministry see being funnelled through your ministry, in cooperation with Build B.C. How is that going to work?

Hon. D. Zirnhelt: The way our ministry operates with Build B.C. is through my representation on the committee, where we try to take a regional perspective to the committee. There are no program dollars allocated to my ministry as part of the Build B.C. initiative. We will look at the plans for the regions, and try to ensure that any investments work with plans that have been made. But as you probably know, in a lot of regions there aren't existing well-developed plans that you can automatically fit into. But to the extent that there are plans, we will fit into them and help Build B.C. work with the existing local priorities.

F. Gingell: I'd like to return to the subject of the B.C. Pavilion Corporation. Early in its mandate your government created a new government bureaucracy called the Crown corporations secretariat. B.C. Pavilion Corporation is, I think, the only Crown corporation that comes under your jurisdiction. Would you please advise us as to what work or proposals or studies have been done by the Crown corporations secretariat since it came into existence, and is anything ongoing planned for 1993-94?

Hon. D. Zirnhelt: I'm going to assume that you're asking about studies that relate to Pavco, because I can't answer for all of the activities of the Crown corporations secretariat.

F. Gingell: Only for B.C. Pavilion Corporation.

Hon. D. Zirnhelt: I just wanted to correct that. I know of no studies that they're doing. All of the Crown corporations had an initial meeting with the Crown corporations secretariat.

Interjection.

Hon. D. Zirnhelt: Yes, to put them on a business-like foundation -- to go out and be entrepreneurial and reduce their dependence on government.

We keep in close contact, but B.C. Pavilion Corporation is well run. It has a management that is, in my view, quite entrepreneurial in terms of looking at its own market needs and its need for capital investment. To my knowledge, no studies have been initiated with respect to the Pavilion Corporation, and I think that's a mark of our support of its management.

L. Stephens: We have just a few more questions to ask, basically to do with regional and community development. The development regions branch develops programs such as the Queen Charlotte economic development initiative. Are there other initiatives like that one around the province to help the pursuit of economic development in specific areas?

Hon. D. Zirnhelt: I'm sorry, I'm not sure of the question. The development regions branch doesn't exist anymore. We have a community economic development

section now. We've just gotten our staff in place in the last few months, so they will be developing work plans. Some initiatives are underway. For example, on the north coast there's a value-added wood fibre study, involvement in the land claims negotiation and work with Orenda pulp and paper. Some are regional-specific, some are project-specific. In the Nechako area we're looking at cogeneration initiatives. There's a tourism strategy, which is an overall strategy, and there are literacy initiatives. In the Thompson-Okanagan we're continuing to look at regional transportation needs, tourism initiatives, and science and technology initiatives.

I could go on, but I'm not sure that I'm answering your question.

L. Stephens: I wanted to know specifically whether, with the reorganization of the ministry, there were any new plans in place to develop the initiatives formerly done by the rural development branch. However, the minister has answered that those are in progress. It's just getting going, and these things will be

[ Page 6743 ]

coming forward. So we'll be asking about it from time to time.

Yesterday the natural resources fund was discussed at some length. Just skimming the Blues, it wasn't clear whether or not there was a lot of discussion on the training, skill development and worker relocation initiatives. Could the minister tell the committee what has been done in regard to those initiatives -- job creation and skill and training development -- in the single-industry towns and in the regions around the province that the natural resource community fund was set up for?

Hon. D. Zirnhelt: Each of those communities that indicated an interest has been sent an application. We expect some applications where there is a shortfall in the federal-provincial funding that's already in place through the industrial adjustment service. There is some indication that some of these communities won't have sufficient funds. We fully expect applications from a number of communities in that area. It will be for those where significant downsizing or closures take place. So those activities -- training and skill development and worker relocation -- are eligible for funding under the NRCF.

L. Stephens: So, at this point in time, nothing has come forward from these communities with regard to developing job training, skills upgrading and so on.

I'm sure that the minister appreciates the importance of worker retraining and skills development. Just as an aside, I hope that the Ministry of Economic Development will be very active in the symposium coming up in June at BCIT dealing with worker retraining and skills development. I encourage the minister to be very aggressive in participating in that endeavour.

I know the minister understands that these one-industry towns are becoming more pressured. I would certainly support the minister in bringing those kinds of initiatives forward much more quickly and in making the communities aware of what is there for them in order to move the process along. The longer we take to develop these kinds of programs, the more difficulty we will be in.

I know cross-border shopping was discussed briefly as well. The minister must understand that the retail industry represents about 15 percent of B.C. business, employs about 145,000 people and represents 50 percent in the lower mainland. Cross-border shopping has diminished to some extent this past year due to the dollar, but it's still a concern to businesses. The largest concern, of course, is the taxation question. The chamber, as you know, has put forward a number of recommendations.

I would like to know the minister's response to the recommendations that the province negotiate an agreement with Revenue Canada for the collection of provincial sales taxes at all the entry points for consumer goods purchased in the U.S., and that the existing Canada Customs laws be strictly enforced. Finally, has the minister contemplated establishing a task force on cross-border shopping?

Hon. D. Zirnhelt: In reverse order, with respect to task forces, because so many of the factors are federal issues -- and you mentioned a couple, like collection -- we are on the federal task force and work actively in that area. It's not a B.C.-specific task force, but where there is a local problem, there are people working locally. The Minister of Finance advises that strict enforcement is something that he pursues frequently and vigorously with the federal revenue minister.

I think the chamber is also suggesting that we harmonize with the GST, which is something we're not prepared to do at this point, because it does spread the taxation more broadly than we would choose at this point. The specific recommendations of the Chamber of Commerce.... I will be meeting with the new president, hopefully in the next week or so, to go over a whole agenda of issues that they have. As you know, they frequently prepare documents for each department. We will give a full and detailed response at that time.

You did ask a supplementary question and make some comments on training, skill development and worker relocation. We are very vigorously pursuing those communities that are worst hit -- single-industry towns like Port Alberni, where there's been massive amounts of effort by our department over the years, which we have renewed -- to work, quite successfully, I think, with diversification activities there. There is diversification potential there.

[3:00]

We are also working with CORE. With some of the experiences in the Pacific Northwest where, because of the spotted owl and other timber deferrals -- and log exports, I must hasten to add -- there's been a wind-down in economic activity.... We want to learn from the experience of those communities, share our experience and try to get some of the people who know the most about it, so that our people who are working out in the field have the latest knowledge about what happens around the country.

Our regional economic development officers have information; when they are fully staffed, they will make sure that the business information centres and community agencies have information on the programs that are available. One of the reasons we instituted the natural resource community fund is to have a program that can pick up those pieces that fall through the cracks. Our people are very vigorous about making sure that people have the information, that the local committees exist where possible and do those things that the community can do itself, and that we draw in advanced education -- colleges and so on -- to work on a comprehensive strategy for skills development in the area.

L. Stephens: I was pleased to hear you say "comprehensive strategy for skills development." I haven't heard much from the government side at all about a skills development strategy. The way our economy is changing, we know that we're going to have to have very extensive skills retraining, training and so on and so forth. Jobs and the economy are the two top issues on people's minds. Many people around the

[ Page 6744 ]

province -- not just in our resource-based towns, but all people -- are concerned about the stability of their jobs. It really is unfortunate that this discussion hasn't come from the government up until.... Well, it's still not there. I can't impress strongly enough on the minister the importance of this job training and skills training. When the government does come forward with a strategy to deal with this, I am sure the whole province will be interested and waiting. I know the opposition will be, because that's something that is critical -- extremely so.

We will conclude with one more question. I'd like to know if the minister has given any consideration to creating special economic zones in the province to try to compete somewhat with the economic zones in Washington State. Has the ministry conducted studies on the feasibility of such an initiative? If so, what would they be?

Hon. D. Zirnhelt: I have to say that special economic zones are continually being studied, but this is not one of the primary focuses of the ministry at this time. The reason is that the studies indicate the advantages may not outweigh the cost. In other words, when you give a tax break for a special zone, you lose tax revenues; what you gain by the additional activity may not offset that. So that's the primary reason.

I would like to point out that I am a full participant in the Premier's economic summit on skill development. As I travel around and meet with economic leaders, I bring in education leaders and others and sit down and talk about the desirability of putting additional funding and emphasis on skill training. In my own experience, wherever I work with community groups looking at economic development planning, they always find there's a need to facilitate, or to develop the capacity of the communities themselves, to ensure a linkage between the needs of small business and industry in a community and to articulate those needs.

For example, a lot of the agencies involved in skill development will say quite often that they're not sure of industry's specific needs. So I've had the experience of sitting down and encouraging a dialogue at the community level between the agencies developing the skills and the industries and businesses in an area. We can facilitate that if it is not being done in the community.

We generally look at the development of leadership capacity in communities to deal with the whole range of things: the provision of capital, training, infrastructure, assistance in dealing with regulatory regimes -- whatever small business needs. Looking at the whole thing, what always comes up is skill development, and I don't think we can ever devote enough resources to that.

R. Neufeld: My colleague talked earlier about jobs in urban areas and in the rural parts of British Columbia. I agree with the Liberal critic that jobs and taxes are probably two of the items that come up in most discussions. I think people are very concerned about jobs; the young people are concerned about not getting jobs. Every time I speak in the House, I talk about jobs. I'm not talking about jobs created by government with a few more million dollars here or there, just to keep somebody going for a little while. I'm talking about real jobs out there in the real world.

I'm going to go to a little of your campaign material -- not specifically yours, but your party's. There were a number of promises or indications given about economic development in the province. Maybe you could enlighten me about what progress you've made on this promise. I won't read the whole dialogue, but I'll read part of it: "A New Democrat government will work with the business community to develop new markets and new products that diversify our traditional resource base." I know pretty well what our traditional resource base is in most of British Columbia.

Maybe the minister could enlighten me as to what markets have been opened up in the last 18 months since this government took over and he became minister, and how they have diversified the traditional resource base to create new jobs.

Hon. D. Zirnhelt: We have worked fairly extensively -- and the B.C. Trade Development Corporation has the lead -- in developing new markets overseas. We've worked on developing markets for wood products, which then feed back to the development of value-added industries in our communities. We're looking at additional markets for value-added food products -- for example, value-added fish in Japan. I participated in some meetings that dealt with trying to open up those markets. I don't have with me here the specific measurements of export activity, but I'm sure it can be provided to you.

Mitsui Homes, for example, has set up a plant in Richmond, I think, and they will be exporting. So here is a plant that's opened with foreign capital. Those have all been facilitated by the government. There has been further development on Toyota's second expansion -- the market for wheels in the world is considerable -- there's the CAPTIN plant in Richmond. CIPA Lumber, which is owned by the Hochu Group, is spending $15 million to purchase and reopen the Delta plywood plant. So that's a reopening.

But finding a new market to provide an additional source of sales for the plywood product, which, as you know, has high-value-added activities, or lots of jobs for the amount of timber they use.... So we have worked on opening markets in Korea, Taiwan and China. It takes a while for them to mature, but we have emphasized those three.

We said we are working with business, but it's actually business and labour, because we find it very useful that labour leaders understand the world economic environment for which they are producing goods. So we have them along on the trade missions with business people to showcase their products and to understand what kind of competition and opportunities are out there.

So the trade missions have opened up some new markets. Our ministry is working less in that field. Export promotion is B.C. Trade's responsibility, the responsibility of the Premier, and I would encourage you to get into that debate there. We work on the investment and work with B.C. Trade to make sure

[ Page 6745 ]

there are investments that match the market opportunities. Where we identify an opportunity in value-added wood or metal manufacturing, for example, we will then encourage investors, who often come looking for an investment.

R. Neufeld: Would you say that your ministry played a large role in the expansion of the Toyota plant and CIPA Lumber's initiative to reopen the plywood plant?

Hon. D. Zirnhelt: Yes. They were initiatives that were established, but they are expansions which diversify into other markets, working with existing businesses to expand. You shake your head, but.... Well, the other member is shaking his head.

Interjection.

Hon. D. Zirnhelt: That's better. I wouldn't want to impugn you here.

Eighty percent of jobs are created by the expansion of existing businesses, so you have to look at the expansion. We have emphasized the growth of small to medium-sized firms. We have worked very extensively to match businesses in this country with investments and marketing opportunities in other countries, through their organizations and government departments that relate to their medium-sized businesses. We can't ignore medium-sized businesses. Those are the ones I have mentioned here. They have considerable growth potential, and we work with them very closely.

R. Neufeld: I agree with what you said about labour and about having labour as a component of the Premier going oversees or your ministry doing some work over there, so that labour and government can see the competition that is there, whether it's in labour costs or taxes. Your government has been attacked quite a bit about increases in taxes, regulations and paperwork. I hear about it all the time. Those have continued to increase.

A lot of regulatory fees have been increased by up to 400 or 500 percent. That's in relationship to a few hundred dollars -- percentages can get a bit out of line. Specifically, for things such as land deals, where farmers are applying to subdivide, those fees have gone up probably by about $250. I know that's under the Ministry of Agriculture, but it still affects jobs and economic growth. It still affects the farmer, because the farmer is a small business man, and he's an important part of British Columbia. But we have had a litany of taxes and fee increases that your government has imposed.

In fact, the other day I got a letter from someone in a small business in Fort St. John who is absolutely refusing to pay the fee increases he has been billed for. He has a hotel, and I think there were eight new fees for different parts of his hotel business. That isn't conducive to businesses that create important jobs in B.C. or to the agricultural community.

I was at the Ministry of Forests offices the other day talking about grazing fees. I know that is part of the Ministry of Forests, but it's also about jobs and about the ranching and farming community. They're facing increasingly more paperwork. Water licences and water fees -- you people seem to know no end. Yet in promise No. 6 in "A Better Way," you say: "A New Democrat government will help small and medium-sized businesses grow.

We will work with business to achieve regulatory reform and reduce the paperwork burden." I say to you, minister, that your government has not done that; your government has done the absolute opposite, and it's having the opposite effect. Obviously you were there in the cabinet committee when you discussed the tax increase. Did you even look at what putting sales tax on labour would do to small business? I ran a small business that paid $60,000 to $70,000 a year in labour costs to a garage for maintenance on equipment. The person who owns that business is now going to pay another 7 percent on that.

He doesn't have any place else to go to retrieve that money. It's either close down or lay someone off. It gets to the point where you apply so many taxes that businesses just start eliminating people. They go on unemployment insurance or welfare, and that doesn't help at all.

As a minister, what kind of drive are you going to make in your cabinet discussions about new taxes and the effect that they will have on investment in this province and on the creation of jobs -- or even on just keeping the jobs we have now?

[3:15]

Hon. D. Zirnhelt: To the extent that we have information -- and we try to get it on all sectors -- we provide impact information if it's available. If there is a negative impact that we can see on a particular sector or a particular business, we make that known. It's available.

Interjection.

Hon. D. Zirnhelt: Yes. And you know that once the government takes a decision, we stand by it. I need to remind you that I make those views known where they are articulated, and I have no problem holding my head up in public and saying that I do that.

As a result of some of the activities -- out of concern for this -- we left the small-business tax rate. We didn't tax restaurant meals when there was some fear that that would happen. The threshold tax on capital was raised, with some significant benefit to those.

We have also been successful in establishing a process whereby, before a tax or fee is imposed, the impact is known and we get some discussions outside of the budget process. Once the tax is set, or as it is being set, it's set on a confidential basis. What we can do, are doing and have done with the tourism industry, and will do with the agricultural community and any others that we can engage in it, is look at the whole range of effects on that business -- the costs of productions that are not government-related and those that are government-related -- and look at the cumulative impact.

While we don't have all the information, we now have a method in place for doing that. We will be engaging small business.

[ Page 6746 ]

With respect to the comment about platform point No. 6, you have to remember that that is a platform we will be working on for the full four years. We don't expect to be able to deliver on everything in the first year or two, but I don't think we have in any significant way added to the paper burden. If you ask small business, a lot of the paper burden is federal. With respect to what we're doing on that, if there are regulations that are unnecessary, then it's important to address those through this process of consulting and looking at the cumulative impact of regulations, because there are some things that have to be regulated.

The whole point of having fees and licences is not for the revenue they produce; it's that a fee is there to cover the costs of providing the service. It's either an inspection fee or a fee for administering that resource. In all fairness, the people who ought to bear the burden are the people who benefit from the service that's provided.

R. Neufeld: It's interesting that the minister said that before you put a tax in place you have discussions and find out what the impact will be on the people of British Columbia. I wonder what happened with the tax you put on homes over $400,000 that you had to backtrack on. So I don't think that is working all that well.

You said there were some methods in place to find out.... You've just got them in now, because it's going to take a while, and I appreciate that. What methods do you have in place now to monitor small business? I've been in small business for quite a few years. I can tell you that we experienced increases in fees before, and I know what that did to us, including the increase in paperwork. Some of it was warranted; but as far as I'm concerned, a lot of it wasn't. Some of the regulations that are put into place just increase employment within the government. It takes more people to monitor it, and in most cases it isn't needed.

I'll take the monitoring of grazing fees for an instance. I'm sure you're familiar with what happens now with the Ministry of Forests. They go out and measure -- if the grass is four inches high, you can turn your cattle out. Things like this take more people. You and I have been in the agricultural world. Is it your opinion that cattlemen and farmers have to be regulated so heavily as to be told when they can turn the cattle out on grass that's four inches high or not? We both know that that rancher or farmer is not going to destroy his livelihood. In most cases those people have been on that land for more than one generation.

When you increase the amount of people to monitor these people, so that they can pay some more fees and have some more regulations put on them, it just gets to be a cat-and-mouse game. Who finally wins? The small businesses give up. They're to the point now where they're just about ready to stick their hands up in the air and say: "I give up." There are a lot of them. There are some younger ones, I grant, that are gung-ho, and they're going to go. But there are a lot of people who have been around for a lot of years and are ready to quit, Mr. Minister. The fees and regulations from government have just hampered their operations so much that they don't know what they can do.

Guides and outfitters are another large...

L. Fox: You need to hire a lawyer and an accountant now just to fill out the paperwork.

R. Neufeld: ...part of my economy in Peace River North.

The member for Prince George-Omineca said they need to hire a lawyer to fill out all the permits and fees. Then on top of that, you pay 7 percent tax on the lawyers' fees. You talked a bit about not wanting to align the GST, but it seems to be going that way. I take exception to you saying that you've lessened the paperwork and the regulations. I think you've increased them, and you've increased them dramatically. It's affecting the business and corporate world; it's affecting whether people are going to come to British Columbia and invest. We don't have a lot of investment that I know of.

But maybe you could help me: tell me how many millions of dollars of investment we've had in the last year in British Columbia in creating new jobs, and how many jobs that created.

Hon. D. Zirnhelt: To answer your last question, there is approximately $25 billion worth of investment in various stages of development in B.C. We've had more business start-ups than we ever had in B.C.

Interjection.

Hon. D. Zirnhelt: All over the province. Check the building starts in your own home community.

I have to correct the member in that I have never said we have lessened the burden. I said it's an intention to examine ways to lessen the burden. But I have to remind you that a lot of the burden is that of federal regulations.

With respect to the one example you used about whether cattlemen know to turn out when the grass is four inches high or not, you have to ask what would happen if there weren't a regulation. All it takes, as you know, is one or two years of doing that to knock it back. There's an argument that B.C. has better grass, certainly, than neighbours to the south. One of the reasons is that there has been good regulation. If there is arbitrariness in the regulations, then I would encourage those responsible in the Ministry of Forests to work closer than ever with people in the agriculture community to go over that.

I know they do, on a constant basis, but people gripe a bit. They don't want to be regulated. They would rather do what they want to do. A few people out there need the regulation, and I think the most constructive way is through peer pressure. But you've got to have the regulation to back it up, because there's no other power than that of the regulator to do it.

I'm not aware of new regulations. They're changing all the time, but you've got to protect the general regime that's there for all of the resources. I think we're going through this experience where members of the public are saying to people operating on Crown land that they want other resources, like water, protected. That's why

[ Page 6747 ]

there are some regulations in place. There may be a sense of unfairness, but when pricing Crown resources it has to be realized that they have to generate a revenue equal to the cost of administering. We're nowhere near that, and it's going to be difficult to get there. In recognition of that, the Minister of Agriculture indicated, on behalf of the government, that water fees and grazing fees have been frozen pending the very review that will look at putting those things on the table and assessing their cumulative impact.

R. Neufeld: I agree that there are a lot of federal regulations. I don't dispute that. There's also a lot of provincial regulation. I guess it's the same as taxes: as far as the person who's living under those regulations is concerned, it's government. You know that as well as I do. Try to tell them that it's not your fault because it's the federal government's jurisdiction, and they say: "Look, I want something done, and you're the closest person to me." But as we continue to add to those regulations, it just makes it worse.

The minister says it's only fair that the fee should pay for the services provided. In the budget this year your government put in 1,200 new FTEs for the province and 1,600 last year -- 2,800 new employees in B.C. At that rate, I don't know whether the poor guys who are paying the fees and licences are ever going to catch up.

You talk about encouraging growth and investment in British Columbia. I have an

article here from the Vancouver Sun, May 20. I'm sure the minister is aware of it. It says: "Move to B.C. Much Too Taxing." An executive saves himself $50,000 by having a job in Burnaby and living in Bellingham. If that's happening, then something's wrong. If we're encouraging people to live across the line and come into B.C. to work at jobs that are fairly lucrative, we're losing all kinds of money.

That's basically what I was trying to tell the minister before: that if we continue to increase regulations and fees, thinking we're going to get that much more revenue, we drive business underground or across the line. Those people still come into B.C. and very likely enjoy our medical and other programs, which are second to none in the world; but they live across the line because our systems of taxation and regulation are so high.

[3:30]

What are we going to do to combat that and encourage people who work in B.C. to live in B.C? How are we going to encourage people coming from other places to invest in B.C., not just in a $200,000 home on the Island so that they can retire forever? That's basically where all the job growth has been. If you look at some of the studies, it's in the lower mainland. I think the minister even alluded to it earlier -- that the jobs are happening where all the houses are being built, and the growth is in people. But that doesn't fuel an economy.

That doesn't give us the money we need to keep the investment and sustain the programs we already have. What are you doing as the Minister of Economic Development to combat that? Maybe you could tell me a little about it.

Hon. D. Zirnhelt: I don't know the details of the example that you're quoting. My guess is that if those are the taxes, he's probably making $250,000 a year, and we're not going to apologize for the fact that he may have to pay a few more taxes up here.

The services that are provided by this government are superior to those provided across the line. We would have to look at it, but when we studied all of the taxes for a small business operator in Washington and in British Columbia, there's in the neighbourhood of 20 percent less in taxes. Yes, the personal part of it may be higher, but the corporate

part is lower than in Washington. All told, there's upwards of a 20 percent advantage on the tax side in operating a business -- everything from the municipal rate through to federal taxes. The facts we've put out are unassailed. When confronted by those facts several months ago on a radio station, a Whatcom County economic development officer had to admit that when you take everything into consideration, yes, it might be better to operate in British Columbia.

Why do we continue to get the growth? People come here because of the services and the lifestyle. Obviously the taxes aren't too much or they wouldn't continue to come here. But I have to admit that any taxation has some depressing effect. Everybody would like to operate without any fees or regulation. It's the fairness of it and what it does to the competitive position. We have studied the competitiveness of advanced manufacturing, for example, an area that should grow on its own, and we're satisfied that it will continue to grow.

A member from our side who has just entered the House can attest to the fact that in Taiwan, where he and a representative from the B.C. Investment Office met with a number of businesses, they did not raise this issue of taxes or labour code. They know what the environment is here; they think it's a wonderful place to invest. We're very optimistic that people will continue to come here. But you do hear in the press that the odd person is concerned. Maybe quite a few people are concerned, because they would rather have no taxes, or lower taxes, to give us an advantage.

Then they would be complaining about the taxes somewhere else. We are concerned that we remain competitive in this province, and we recognize that if we do anything that makes us uncompetitive, we'll be cutting off our nose to spite our face.

You talk about the increase in the number of FTEs. I just have to point out that we're being honest about the accounting. A lot of these are conversions from contractors. In fact, in the figures that I have, there's a growth of 300, or about 1 percent of the public service, when the growth in the economy is pushing 3 percent. You say there's more government. The government share of GNP is actually reduced. Government is a smaller part of the GNP than it was a few years ago. It has marginally declined.

Earlier you were asking about regulators. There have not been large increases in the number of people that affect many of the sectors. In fact, a continuing problem for us is that we're not able to enforce existing regulations. We would like to do more of that. There are people out there asking us to protect certain resources

[ Page 6748 ]

for their use and enjoyment, or for their businesses. When you get conflicts between resource users and no way to solve them, you have to have an intervener of some kind, and government has done that. But we have not substantially increased that burden.

R. Neufeld: The people who hear you say that you need more people to do more regulation but that you can't afford it are probably saying to themselves: "I hope you can never afford it, because I've got enough now." There's no doubt that regulation is needed in some areas; I agree with that. Regulation is probably needed in all parts of government and Crown resources and those types of things. I have no problem with that. But it gets to a point where it's overregulation.

[F. Garden in the chair.]

I'm going on to something else, and it's another point in your "A Better Way." My colleague asked a little about B.C. 21, and you didn't answer very much about what involvement you had had with it, but it says: "The New Democratic government will work with local governments and communities to make sure that every region gets its fair share of economic development and opportunities." I would assume that falls into your ministry.

With Build B.C. and what you're going to do with it, could the minister tell me that he's going to see that each region of the province gets its fair share and how he feels that fair share is going to be done -- by population, by region or by need? On what level is this minister going to work at to try and see that that development takes place in an even way across the province?

Hon. D. Zirnhelt: As I've said before, we will look at needs in the regions. We have indicated that there are, in effect, two economies in B.C. One of the reasons we've created this instrument is to try to address problems that otherwise couldn't be addressed. We will be focusing, through the B.C. Investment Office, on the regions that need projects. It has a regional focus. There are a number of projects in each region. We will continue to try to find investment locations in regions to match investment opportunities with the investors that come through the door of the B.C. Investment Office.

Our people in the regions will be looking at the opportunities. We will be articulating the opportunities and the needs through the B.C. 21 committee to the extent that we have good information available. For every 100 projects that are out there, only ten of them might see the light of day as being feasible, but we will make some assessment of the needs available to the people considering decisions on B.C. 21.

R. Neufeld: I thank the minister for assuring me that we'll be dealt with fairly across the province and that he'll be there making sure, when those decisions are made, that it will be fair across the province, because I think there's probably some fear in some parts of rural B.C. that things may not happen, for whatever reason. I think there are all kinds of programs that could go ahead; I can think of one in my constituency that's on the table. It doesn't need any engineering or any okays or whatever, and it could have gone ahead two years ago but hasn't yet. I hope that that's taken into consideration. That will create jobs.

Did the closure of Cassiar and the annihilation -- levelling -- of the town of Cassiar have any effect on your ministry? If it did, how many dollars would have come out of your ministry? Or did it come out of some other ministry? Maybe you can help me a little bit there. I'd also like to know what happened to the people that came out of Cassiar in job retraining. Have they been put into new jobs? Or are those people on unemployment insurance or still trying to find a job someplace?

Hon. D. Zirnhelt: I don't think we have a final report on the Cassiar situation, and we may not be able to track what happens to everybody. I'm not sure what it would serve. I think we know that a lot of people have been relocated, but I don't know how many. We could probably try to get some information on that for you; I don't have that with me here. We made attempts to keep Cassiar up by having a Peat Marwick study done through the job protection commissioner, which shopped around looking for investment and buyers. As you know, at the last minute there was some interest, but nothing materialized.

We were participants in a committee there that assisted in the winding down of the town. As for dollars that we actually contributed to Cassiar, there was a write-off of a loan. I'm not sure if that's what you're asking for. Seven hundred thousand dollars of the $5 million loan was written off. A lot of that went....

Interjection.

Hon. D. Zirnhelt: Yes. There were other funds spent, but our ministry wrote off $700,000 of the $5 million loan.

The Chair: The member continues, through the Chair this time.

R. Neufeld: I apologize for that. I was just trying to speed up the process a little bit, because I've got a couple of questions yet.

I appreciate knowing the amount of the loan, but what other dollars were expended by your ministry specifically towards the closure of Cassiar, the retraining of workers and trying to find those workers jobs?

Hon. D. Zirnhelt: There was a special fund established through Treasury Board. They did not flow the funds through our ministry. The Minister of Finance would be able to answer that; he has the specifics. Our ministry didn't flow the dollars.

R. Neufeld: Okay, I'll work on those later.

My last question is about cogeneration. My colleague from Prince George-Omineca also talked about Vanderhoof and cogeneration with natural gas. This is a big part of Peace River North natural gas. The

[ Page 6749 ]

Energy Council was out for over a year making up a report that came out just a while ago, which set some parameters for the export of electricity. Not too long after that the Minister of Energy came out with a report which okayed a fairly large sale -- I can't remember exactly off the top of my head -- of natural gas to some companies just across the line in Washington, where they were going to generate electricity with that natural gas.

When we talk about value-added, you talk about value-added in the wood industry, I talk about value-added in the natural gas industry and in the crude oil business. That's one value-added that we could do. We could generate that electricity in B.C., create some more investment, some more jobs and then export that electricity across the line. I don't want the minister to misunderstand me. I'm not saying that we shouldn't be giving those export contracts for that natural gas. It's all beneficial to the province, and that's what creates jobs in the north. But I think there was one further step we could have gone.

We could have still produced the gas but also created some jobs by making it into electricity and then sending it across the line. I wonder what input the minister had with the Minister of Energy, or with cabinet, in making those decisions -- where we don't encourage IPPs to build in B.C. -- and your government hasn't -- and just sent the raw gas across the line.

Hon. D. Zirnhelt: With respect to raw gas going across the line, from the studies that we have done, I understand that there's an economic problem. It's cheaper to flow the gas through pipelines and have the electricity generated there, than it is to generate the electricity here and transmit it. So the economics of the industry are dictating a little bit of what's happening. We have undertaken through the B.C. Investment Office a major co-gen study. We've analyzed specific projects, and we will be providing the investment office and the advisory committee with a study that talks about the economics of the industry.

[3:45]

Just as recently as yesterday I met with some of my colleagues to discuss the Elk Falls cogeneration facility. Fletcher Challenge has made a new proposal to Hydro to actually generate electricity and natural gas. What makes the economics of gas-fired, or any co-gen, is the "co" part of it, where you're using the surplus heat to kiln dry, or something like that. In examining the opportunity for export of electricity, those that have export markets are actively working on coming forward with proposals. In fact, I think we have one application now for an export permit. But most of the projects cannot find markets.

There is a difficulty in finding a market, because their costs of production are higher than what they can sell for. The basic problem is that if they expect B.C. Hydro to be the customer, it would require some subsidy, because B.C. Hydro would have to get less from it than its actual cost. The B.C. Energy Council found that the idea of paying a premium was not acceptable to the people.

If we were providing a subsidy to a wood waste generator, one project may have an insignificant effect on Hydro rates for everybody, but many projects coming in under the same criteria would create a large cost, and we would be artificially affecting the economics of that industry.

I am hopeful that we will see some projects up and running, but even with the ability to export, it is still difficult to operate energy plants here on a cost-effective basis. But we will be assisting wherever we can.

R. Neufeld: I appreciate that the cost of wood-waste-generated electricity is more expensive. I think we knew that long before the Energy Council went out to check that out. That's something that has to be dealt with. It's another issue that maybe we can deal with in the Minister of Environment's estimates, because that wood waste is being burned regardless. It's a good way to get a dollar for it.

I'm interested in what you say. It's cheaper to export the natural gas to the U.S. and have them generate electricity in Linden, Washington, and sell it to the U.S. market than it is for us to generate it right here or even north of us. We could generate it in Fort St. John -- in fact there's a big co-gen plant there -- and export the electricity through B.C. Hydro.

That would lead me to believe that what you said earlier -- that it's just as cheap to operate in British Columbia as it is in Washington -- doesn't ring quite true. Maybe you can just explain that a little more.

Hon. D. Zirnhelt: I wasn't talking about operating costs; it depends on the location. You have to examine every site. The transmission loss on wires of electricity that's generated here is significant, and the transmission corridor cost is higher than for transporting the gas. Looking at the economics, often it's better to generate the electricity closer to the point of consumption of the electricity. That's the point I made.

R. Neufeld: I want to press that a little more, because there's no reason why.... We have the pipelines in place -- the same as the hydro lines from the north. We could generate that electricity in co-gen plants right here in the lower mainland, in Vancouver or the Fraser Valley someplace. That's not very far from Linden, Washington. Can we compete there if we generated it there? Are you telling me we still can't compete? I don't believe there's much line loss between Chilliwack and Linden, Washington.

Hon. D. Zirnhelt: I have to know which project, generally speaking. We do produce electricity down here, and it's some of the cheapest we produce for B.C. Hydro, but there's environmental impact here, too. If we establish them here, we've got airshed problems in the lower mainland, so that's a factor. My guess is that, yes, we're cost-competitive in producing it. I just have to fall back on saying that you've got to examine all the factors that affect the operation of the particular industry. You can't answer most of those questions unless you do an in-depth study of the particular project.

I was saying that given the situation, there are still marketing problems for the electricity. There is a

[ Page 6750 ]

surplus of electricity in British Columbia already, and it's among the cheapest that can be produced.

R. Neufeld: As far as air quality goes, I don't know how the minister thinks, but if you generate electricity with natural gas in Linden, Washington -- I'm not sure of my geography, but it's not very far across that imaginary borderline -- or you generate it in Chilliwack, does that mean that the pollutants, if there are any, from Linden, Washington, all stay south of that imaginary border line, that they don't impact on us? I fear not. I think it goes into the same air, and it's the same air that we breathe. I think that really the work that's been in cogeneration has delivered, as you say, a very cheap hydro.

The companies that are buying that gas across the line to generate electricity obviously have some markets for it. I think Fording Coal had some markets already established that they were shut down on because the Energy Council had to do a study on it. That certainly doesn't lead to job creation or any kind of wealth of investment. I wonder what the minister thinks of that.

Hon. D. Zirnhelt: I think you're asking me to be an expert on wind, and you're a pretty good expert yourself. When you get into some specific environmental impacts, I can't comment; it's not my area of expertise. But yes, generally I guess I'd have to say that if there are two plants on the same side of an imaginary line, then there are generally the same regional environmental and economic effects. If that's the answer you're looking for, then I'm prepared to offer that. I really lost the point of your question, but I'm not an expert on the environmental impact.

But I can answer that when the government of the party that you represent provided a premium, it was done without any analysis. It was a deal to get a cogeneration up and running, and it didn't have the analysis that could stand any test of examination. We took some time -- a year -- to examine the whole role of energy exports in the economic development of the province. We have said yes, under certain conditions -- and that's out there. We're reviewing the conditions that were recommended by the Energy Council. They've recommended that yes, as long as there's no subsidy, there can be some energy export.

We're hopeful that there will be a number of projects coming out of the new policy for which there is a market and that are viable and that will provide jobs.

But you can't say that cogeneration is the answer for job creation in British Columbia. Yes, it's one of the things that will produce jobs, and we're very hopeful that quite a number of those projects will be up and running.

R. Neufeld: I know that the cogeneration is not the answer to all the jobs in British Columbia, and neither are the issues that you talked about in value-added wood and in value-added in other places in the agricultural industry. That's not the answer to all the jobs in B.C., but if you put them all together they culminate in some investment in British Columbia, and they provide some jobs that are needed in B.C. That's what I'm talking about.

I don't think you have to be an expert on the environment or a rocket scientist to figure out that if you're going to generate electricity 20 miles across the line, that whatever goes into the air is going to affect us in British Columbia as much as it does the people in Washington. I think that's a pretty loose excuse on your part for not being there and trying to ensure with your government that we are doing everything possible to create value-added jobs in that specific industry. There are all kinds in other industries.

Maybe the minister isn't strong enough in all the other areas -- in the wood, in the agricultural business and in the ranching business, all those industries -- at the table in letting the concerns of people in British Columbia be known to the rest of cabinet on the issue of jobs and the creation of economic development. I don't mean just in Vancouver and Victoria and the Okanagan, because that isn't where everybody in British Columbia lives. There are a lot of people who live in the other parts of B.C. who also need a little bit of help and encouragement.

All I can say is that with all the additional taxes, fees, regulations, and maybe some of your ineptness in trying to get across to the rest of your cabinet members that it's very important to create jobs, part of the problem we're in today is caused by not seeing a lot of growth in the rural and northern parts of British Columbia.

I don't have any other questions for the minister at this time, so I thank him for his indulgence.

L. Stephens: I just want to make a few comments. The opposition has no further questions. I would like to thank the staff of the ministry for helping us through this process. Due to the reorganization of the ministry over the past year, there were a number of questions that we had to bring forward. I'm sure there were a few more that we could have asked as well.

I'd also like to say to the Minister of Economic Development that the people of British Columbia are looking to this ministry and to you to promote the economic well-being of British Columbia and bring forward government policy that allows for expansion and investment in the province. The opposition would like to see the minister pursue more vigorous initiatives to expand our markets and trading partners, promote our communities and regional economic development for all the citizens of British Columbia and support job creation, training and skills development for our most precious resource: the people of the province. With that, Mr. Chair, I take my place.

L. Fox: By way of a brief

summary -- I'll try to keep it brief, because I know the Attorney General is looking over here constantly; he's waiting to see us conclude this so we can get on with the next order of business of the House -- I'll summarize the few days that I've had in the course of these estimates. I have to say that I was extremely disappointed in this minister not taking on the advocacy role that in my view he should in representing the interests of small business at the cabinet table. It's obvious from the course of action by

[ Page 6751 ]

this government, through the litany of fees and services and expansion of tax on the small business community, that small businesses can't feel comfortable that they have a minister who recognizes and represents their interests at the cabinet table. The upcoming year is going to be extremely challenging for this ministry, because the statistics will show that we still have two economies in the province; we'll find that the rural and northern economy is going to continue to drop in terms of the number of jobs, but we'll see jobs being created in the lower mainland and other growing areas around the lower mainland. That's a concern to me.

[4:00]

Hon. Chair, there's no real reason that we should consider profit as something which is not desirable. If we have a climate in this province that deters individuals from risking their capital in the way of investing it in small business, which.... As I pointed out before in these estimates, there are 500,000 people working in this province for companies that employ 20 or fewer employees. I know from my experience in a company of that nature that the encouragement is not there.

Between the two levels of government, there's no longer any incentive for me to risk the holdings that I've achieved in order to do business in this province, because if I do make a profit, immediately this government looks upon it as something that gives it room to move in terms of taxing policies.

My colleague from Peace River North pointed out an issue, and in fact I respect what the minister suggested. It maybe doesn't reflect the total picture, but if an individual is making substantial earnings in a corporation in Burnaby but chooses to live in Bellingham because of the total tax package offered in the United States, that has to be a concern. While that certainly isn't the main problem, it's an indicator that this minister should look at, because it's a symptom of a problem. It should help to identify those areas of concern and those limitations to investment in British Columbia.

If we are going to be successful, specifically in the regions of this province, we have to recognize that the high-paying jobs we once enjoyed in the rural parts of the province are diminishing. They are being replaced with much lower-paying jobs in the value-added area and in other small business areas. There's a huge shift there and a dependency on government at all levels because of that shift.

We have to encourage development which will help us meet the demands in those other regions. We should not just stand up in this Legislature and say that British Columbia has the fastest growing economy in Canada, because that is an average statistic, and it applies a lot differently to Prince Rupert or Vanderhoof than to downtown Vancouver. The failure of this government to recognize that has indeed led to a weakening of the economy in many of those areas. The challenge for this minister is to be more proactive: be more of an advocate, and stand up for small business and say that there's no crime in making a profit. Profits in fact drive the investment in terms of small businesses.

With that, I want to thank the minister's staff and the minister for sitting through this sometimes tedious process. I do appreciate the opportunity.

Vote 23 approved.

Vote 24: ministry operations, $73,954,200 -- approved.

ESTIMATES: MINISTRY OF ENVIRONMENT, LANDS AND PARKS

(continued)

On vote 32: minister's office, $375,354 (continued).

D. Jarvis: I just have a quick question, and also a little bit of an appeal, that pertains to the Maplewood flats in my riding of North Vancouver-Seymour. As you are probably aware, it's one of the few remaining salt-water marshes in the lower mainland, especially in dirty Burrard Inlet and the environmental mess that it's in now. They are trying to clean it up, but they are short about $30,000 or $40,000. I don't know whether to ask you whether you could allocate some priorities or if you are already in the midst of it as part of the program that's going on. Are you familiar with that?

Hon. J. Cashore: Over the years I have had many conversations with Mr. Partington, who is very much involved in the Maplewood flats issue. With regard to the specific role of a component of our ministry at this present time, I don't have that answer with me, and we don't have the staff with us at this time who can provide that answer. It was our understanding, by agreement, that we were starting off with the Crown lands part of the ministry this afternoon and then moving into parks. If there were any further questions on Environment, we would have Environment staff come in at that time.

We have made a note of that and will get back with an answer -- either during these estimates or directly to the member.

D. Jarvis: You are correct in your understanding, but I interjected in there because I had some previous appointments. I'm running back and forth between Houses and everything. I will look forward to your reply on that.

F. Gingell: The minister will remember that yesterday we were discussing the special account, and I have a couple more questions.

To quickly review, the revenue net of direct costs that goes into the special account comes from sales and easement leases. We were discussing the way they had been dropping in amount fairly dramatically in the last four years. In fact, they are anticipated this year at $37 million net after $9 million costs -- down from $67 million in 1991. You said that that was primarily a decrease in sales proceeds. The amount of the decrease is fairly substantial. Does this indicate that there is a change in this government's policy relative to the disposal of Crown lands -- i.e., that you are a little slower to dispose of Crown lands these days than governments have been in the past?

[ Page 6752 ]

Hon. J. Cashore: It reflects that some areas, such as the shore-land sales, are decreasing for reasons that were explained yesterday.

With regard to the general gradual decline in this area, I wouldn't go so far as to say that it reflects an overt change in policy, except I think that we're all cognizant that there's a renewed land ethic. More care, therefore, is being taken in terms of how we administer and dispose of the land and for what purposes. So in a number of ways the entire land base is under review. It's reassuring to know that the amount of land that is sold or leased within a given year is a very small portion of 1 percent of the Crown land base of the province.

So it doesn't reflect some policy that says we're going to reduce it by that amount of money. It does reflect that a great deal more care is going into these considerations.

Hon. Chair, I would like to introduce two officials who are with me in the House who have not been introduced yet: Tracey Burns-Clark, who is manager of the Crown land account and Greg Roberts, director of land policy.

F. Gingell: Hon. Chair, can the minister please advise me how much of the lease revenue anticipated for the year 1993-94 comes from my favourite 4,212 acres of the Roberts Bank backup lands, and how does that rental income compare to last year?

Hon. J. Cashore: It is part of the calculation, but we don't have the details on that at this time.

[4:15]

F. Gingell: Perhaps the minister would make the commitment to send me that information and I'll pass it on.

There was an item in the special account called "Financing Transactions." When you read them it gives you the picture that these deal with the sale of land on term payments and the subsequent receipt of amounts owing on debts due from the sale of land that was previously recorded as a revenue. I'm having problems following that. Perhaps the minister could give me a better description of what those receipts are.

The estimates say, "receipts represent repayment of outstanding loans and deposits made on pending sales." I presume then that the disbursements are the accounting for transferring the deposit to a sales proceed when the sale is finally consummated. Perhaps you could explain what all those things mean.

Hon. J. Cashore: If you'll bear with me, we're trying to get the detail on that answer. Some of the information is quite detailed, so perhaps if the hon. Leader of the Opposition could go on to the next question, we will respond to that shortly. Also, with regard to the earlier point on the backup lands, we would like to arrange a full briefing for the Leader of the Opposition, where staff would give the detail with regard to that question.

F. Gingell: Thank you very much for that offer. If we just go back to the operating transactions, the little grouping above, I understand that in this year's estimates, the amount that's shown as $2,638,482 is the difference between the 1993 estimates and what they actually believe they are going to come out at. That is relatively straightforward. You made some estimates of what you expected the revenues and expenditures to be for this year. You got to the end or the middle of February, and an estimate was made to come out with an estimate of where you'd be at the end of March. You recorded that for us. Fine.

But you've also got a proposed adjustment of $9.8 million for '93-94, and that's an unusual item in a special account. Could you explain to me what that $9.8 million is?

Hon. J. Cashore: Hon. Chair, this adjustment is required to reinstate the profit from operations reflected by net revenue calculated on an accrual basis to a cash basis.

F. Gingell: Is the minister saying that the $37 million recorded as revenue is on a cash basis only, and the $9.8 million is the amount of sales proceeds that will be received, but in subsequent years?

Hon. J. Cashore: Hon. Chair, we're getting into some very complex detail here. Again, I think that it would be more productive if somehow we could all sit down in a room, go over these figures together and review it in that way. But this $9.8 million revenue is required on an accrual basis, as an adjustment to bring the account to cash.

F. Gingell: As a matter of fact, I've probably had more briefings on special accounts than any other member of this Legislature, and I thought I understood them. Anyway, if I may just go back, then, to save us some time. My statement was that it is the portion of proceeds that is not to be received in cash this year but is to be received in cash in a future year is the amount that has been added to. Is that what you have said back to me? I believe that it is.

Hon. J. Cashore: Yes, it could be.

F. Gingell: So all of the items that are in the financing transactions, then, are purely and simply cash receipts on sale contracts that have been made in previous years and are now being received in a subsequent year. Is that correct?

Hon. J. Cashore: It's cash that's received in a current year. The revenue could be received in a previous year or a future year.

F. Gingell: Thank you very much. I've got one last question on special accounts. We discussed briefly yesterday the intention in past years to make transfers back to general revenue to get rid of these huge notational balances that have been built up over many years primarily from the sale of Crown land. The question that I asked then was: why were the transfers not made? What was the reason for the discussions between the Crown lands and the Ministry of Finance

[ Page 6753 ]

that caused those transfers not to be made? I would like to suggest to you, in all sincerity, that the response that you made yesterday that was on that briefing note that had been sent to my colleague for Surrey-White Rock is not an answer; that's just repeating the question. The question is: why were the transfers not made?

Hon. J. Cashore: It wasn't made as there was confusion re the appropriate accounting policy. We have received advice from the Ministry of Finance, and those appropriate changes will be made.

F. Gingell: I will just add one more question. The original intention of these special accounts, one would presume -- and I haven't gone back to the original Housing Act of 1973 -- is that revenue coming in from specific sources, like revenue coming in from stumpage and royalties in timber, has sort of been mentally committed to forest industry matters. In this case, one presumes that the intention was that revenues coming in from the sale and various actions relative to Crown land were being saved for and would be used for Crown land type of expenditures and programs.

This clearing out of the account -- and reducing it, in effect, to $50 million -- basically says: "This policy that wasn't followed through on in past years is no longer the policy. We recognize that we're not going to spend $474 million on Crown land, but leave us with $50 million so that we do have enough money to make sure our ongoing programs are able to be funded." Is that a fair statement?

Hon. J. Cashore: Yes, that is a fair statement. I'm glad I don't have to repeat it, because the Leader of the Opposition said it well.

Hon. Chair, with regard to another question that was asked earlier about the backup lands lease revenues, the annual gross revenue from Roberts Bank backup lands is approximately $850,000. This has remained consistent for the past few years.

J. Tyabji: I think we're almost finished the general framework for Environment, but we're just finishing off the water section.

I want to ask about a news release that came out on April 15 with regard to the Kootenay Lake fertilization program that the Ministry of Environment is doing in conjunction with B.C. Hydro. I apologize if the staff aren't here for this specific thing, but I wanted to canvass this in general terms.

In the news release, the Minister of Environment, Lands and Parks and B.C. Hydro have committed $450,000 for the second year of the Kootenay Lake fertilization program. This program is a response to the declining level of kokanee that they found in the lakes. Is it standard policy for the Ministry of Environment to solve the declining fish stock problem with a fertilization program, in absence of an investigation into the cause, or would there automatically be an investigation into the cause and an enhancement program as an adjunct?

Hon. J. Cashore: There was an investigation. Every situation we deal with requires its own response because of the unique circumstances. In this case, the biological chain was certainly impacted involving the mysis shrimp, the kokanee and the food chain: and, of course, there was a major consideration with regard to the Gerrard rainbow. Insofar as the question of whether this a matter of policy, it's policy to address challenging concerns in terms of areas like this. That is why this process was followed.

[E. Barnes in the chair.]

Hon. Chair, I would mention that it was our understanding from the consultations that had taken place among House Leaders that we were going to be needing land staff while we wrapped up on the lands part of the considerations. Then we were advised that we would be moving on to parks issues -- we have parks staff standing by -- and then if there were further questions on environmental and wildlife issues, we would conclude with that. We are simply going on the basis of what we understood to be the process.

I know the hon. member asked me to give a general answer, which I can do, but I think it's getting into the area of a question where we do need the specifics.

[4:30]

J. Tyabji: For the minister's information, I was not aware of what the arrangements were with regard to staff, and having seen some of the staff from the general environment estimates earlier today, I just assumed it was more or less open. However, we do have the critic for Lands and Parks with us. I think there's a very limited number of questions that he has left for that part of the debate. I'm hoping that we can get through the general framework for the entire estimates by the end of today; then we can get on to some specific issues and close the estimates fairly soon.

Hon. J. Cashore: Perhaps someone on the opposition benches could advise me when we will no longer require our land staff here. At that time our park staff will come in. If we require further environment staff, they are standing by.

W. Hurd: The opposition doesn't have a great deal more about lands, although I did have a few additional questions on the policy with respect to Crown land use for ski developments in the province. I am specifically asking for information about the Tod Mountain development and the requirement for advertising public meetings in connection with these ski developments. In the case of Tod, can the minister advise us what participation his ministry had in the public meeting process that would have gone into finally awarding a management development agreement to the company?

I'm looking down the road into the next fiscal year to determine, in the event that these types of agreements are signed, what type of involvement we can expect from the ministry in providing public information about the sale and/or lease of Crown land

[ Page 6754 ]

which is required to put these kinds of ski hill deals together.

Hon. J. Cashore: Given that this was a sale of an existing entity, the situation is different than it is in the regular policy of dealing with land that's coming into a ski development for the first time. In the area of determining land use with regard to our ski policy, there are processes for involving and consulting the public. When it gets into the negotiation stage, the public are not involved.

W. Hurd: Perhaps I can ask a specific question about the Premier's announcement, which occurred during his trip to Japan. Were staff members available from lands at that announcement, or are we dealing with just a...? Given the fact that that announcement pertained to a Crown land issue and to the ski hill development process in the province, can the minister explain what exactly the Premier was releasing when he was travelling to Tokyo, and whether any assistance was provided for the Premier in addressing any questions that might have come up in connection with this policy?

It just seems to the opposition to be a rather curious method of announcing this type of development, given the fact that there were at least a few concerns expressed by the public about the nature of the sale and/or lease of Crown land.

Hon. J. Cashore: A sales agreement was announced between Tod Mountain and Nippon, which had to be approved by the Crown lands branch of this ministry. All of the Crown land negotiations were completed prior to the Premier going on his visit to Japan. No land staff was present, nor was there any reason why they should be, because the appropriate diligence of the Crown lands branch had been applied in every respect to every aspect of this transaction. It is not unusual for a Premier to be involved in making a major announcement about an activity that takes place in any of the ministries or the branches of ministries of government.

W. Hurd: In connection with the Todd Mountain facility, then, the minister is basically saying that the Premier's only involvement in this particular development was to make the announcement in Tokyo, and that his office in no way was involved in any of the discussions with the Japan-Nippon cable company or any other principal who might have been interested in this development. This was strictly in the purview of the Ministry of Environment, Lands and Parks.

Hon. J. Cashore: Hon. Chair, I'm not evading this question; I'm simply stating a fact. If the hon. member wants to ask the Premier what his involvement was, whom he has had conversations with, or who his office has talked to, those are not questions that I am able to answer, and they are not questions that are appropriately put to me. I can answer for the actions of the officials in the Crown lands branch, and I have said and will say again that those officials have carried out all of the required functions in monitoring this transaction.

I would also say that it's entirely appropriate for the Premier to be involved in making such an announcement, and I can only speculate that when it comes to making an announcement it would seem to me to be quite reasonable that if the process was being worked out for the time and place of an announcement, that that would seem to me to be quite an understandable conversation to be taking place.

C. Tanner: I want to change the subject with the minister a little bit, but it still concerns Crown lands. Those are the lands that belong to the Crown that are between Vancouver Island and the mainland, and the ocean floor in between. It's my understanding that those lands belong to the Crown and come under the jurisdiction of the minister. Is that correct?

Hon. J. Cashore: Yes.

C. Tanner: The Islands Trust organization is presently putting together a policy which they hope to have in place by September, and part of the policy is consideration of artificial reefs and the dropping of artificial reefs in various parts of Georgia strait. It is my understanding that they have developed a tentative policy which they are going to put before public meetings. I also understand that the minister's department in his Crown lands branch is looking at a policy. Could you tell me how the two are working together?

Hon. J. Cashore: Hon. Chair, I answered this question yesterday in a very full and comprehensive manner, so this issue has been thoroughly canvassed.

C. Tanner: I will read the Blues for that, and I apologize for going over it again. It was my understanding you hadn't, but with the two Houses we sometimes miss these things. Two years ago we did drop a boat, the Church, in a provincial park, and there was one dropped, as you know, in the ocean off Sechelt this year. Did the minister talk about parks as far as artificial reefs are concerned yesterday?

Hon. J. Cashore: No, that is introducing a new aspect to the discussion. We will have park staff in shortly, I understand. But I believe we'll probably find that the question has also been answered, and, for the hon. member's information, we did state that there will be no further artificial reefs until a review of the entire process has been completed to my satisfaction.

C. Tanner: Is the minister aware that in the United States, for example, they have specific legislation for artificial reefs and parks, to protect not only the people who want to dive but also the fish within the artificial reef?

Hon. J. Cashore: Yes, I am aware of that. I'm also aware of the question with regard to marine parks and how it relates to this type of amenity. We are reviewing that.

[ Page 6755 ]

W. Hurd: I just want to briefly shift the focus of discussion to tenures that could be offered by the Ministry of Lands for recreational ventures: wilderness experiences and backpacking adventures. Can the minister advise the committee whether in this coming fiscal year the Ministry of Lands will be issuing any tenures to groups or individuals proposing to secure access to Crown land for a period of a fixed lease to provide these types of tourism ventures with some sort of security over Crown land which would be used to facilitate these types of developments?

Hon. J. Cashore: The answer is a tentative yes, based on the completion of the back-country recreation policy, which is addressing this issue. A lot of the details of the very item the hon. member was asking about are in the process of being decided. Once that policy is decided, we believe that we will have in place a fair and appropriate modus operandi for addressing this issue, in the context of recognizing that a multiplicity of issues need to be carefully thought through. So the back-country recreation policy is the vehicle with which the government is coming forward with its decisions on this issue.

W. Hurd: I'm aware of at least one or two proposals that have reached the stage where tenures are close to being granted -- at least that's my understanding. Before those tenures are granted, can the minister advise us whether it's necessary for the applicants to deal with local Indian bands with respect to gaining access or having the tenure approved? Is it the responsibility of the applicants to deal with Aboriginal Affairs issues, or is the ministry actively involved in trying to address some of those problems?

Hon. J. Cashore: We do it, because it's clear that it's part of our fiduciary responsibility.

[4:45]

W. Hurd: So it would not be the responsibility of the applicant for tenure to deal with bands in any way; the ministry would be totally responsibile for addressing any concerns the band might have about the nature of the tenure and the types of developments that might go forward -- whether they be fishing lodges, hunting lodges or any other type of facility. Is he aware that there might be some negotiations going on between some of the tenure-holders and aboriginal people? Or would that not be what they should be doing in this case?

Hon. J. Cashore: The answer is yes, we are aware of that. We have a fiduciary responsibility within the lands branch of the government to ensure that those consultations take place. When it behooves an operator to enter into such consultations, we see that as understandable and, for the most part, positive.

W. Hurd: Given a scenario where those negotiations might break down over the issue of aboriginal title or an aboriginal treaty, would it be the responsibility of the Ministry of Environment, Lands and Parks to mediate that process, or is a more likely scenario that the tenure application would just be put on hold until such time as the Aboriginal Affairs questions were dealt with?

Hon. J. Cashore: The mediation is certainly a viable approach. Where mediation is not successful, government has a responsibility to make a decision. That decision would have to be made taking into consideration all of the factors extant at the time.

W. Hurd: In terms of access to Crown land in the form of a tenure for a wilderness adventure company or a fishing operation or some other type of tourism venture, it wouldn't necessarily be the case that a disagreement with one of the local aboriginal communities would stall the application for tenure. It might be possible for the ministry to mediate any disagreements and grant that tenure. Is that a role that the ministry would engage in in order to bring some of these worthwhile tourism ventures into active management of the province, obviously with a lot of spinoff economic benefits?

Would the tenure issue be in any way halted -- thwarted even -- by a disagreement that might exist between the applicant and the local Indian band?

Hon. J. Cashore: It is the responsibility of government to govern, and therefore we have the responsibility to make a decision. In making a decision, we have various options. We can grant the tenure; we can grant the tenure with conditions; we can refuse to grant the tenure. All of those options are part and parcel of the decision that has to be made by the Ministry of Environment, Lands and Parks. In making those decisions, the kinds of issues that the member for Surrey-White Rock is describing are issues that are understandably before us.

W. Hurd: Can the minister advise us then of whether those who are currently applying for tenure and may be close to receiving it and who may be having difficulties coming to an agreement with the local aboriginal people.... Will the ministry, over the shortest possible time, address their tenure applications independent of whatever dispute might be ongoing? Will a decision be rendered that won't be tied up in the broader issue of aboriginal treaties and compensation in the province?

Hon. J. Cashore: Right now things are being tied up not because of those kinds of decisions, but because there is a moratorium in place until we have our policy work done. We realize there is urgency to get that policy concluded and out. As I said before, government still has the responsibility to make a decision in a timely manner, and it has to take all of those factors into consideration.

W. Hurd: I have a final series of questions on Crown lands. It relates to water licence fees and grazing fees, which were recently increased by the government. I understand that responsibility for range land falls

[ Page 6756 ]

within the purview of the Minister of Forests, but could the minister possibly advise the committee of the kind of overlap that exists when you're dealing with the cattlemen's associations? I assume that they make direct application to the Minister of Forests on range fees even though the lands may be Crown lands, or would they make submissions to both ministers with respect to this important issue?

Hon. J. Cashore: It's my understanding that they make their initial application to the Ministry of Forests, but it's also true that we in the Crown land branch do have ongoing discussions with the Cattlemen's Association.

W. Hurd: When it comes to monitoring the effect of wildlife and cattle grazing on the grasslands, am I correct in assuming that that would then be a function of the local office of the Ministry of Environment, Lands and Parks?

Hon. J. Cashore: We rely on the expertise within the Ministry of Forests range division. Since we rely on that, I would say we do have a role in having some input into how to manage the results of that input.

W. Hurd: Can the minister advise how the dates for grazing in the province are arrived at? The opposition has received expressions of concern about some areas of the province which have a heavy moose population, for example, and because of that heavy population the date on which cattle are permitted on the Crown grazing areas is moved back every year. Would that decision be made by the Ministry of Forests or would it be made under the direction of the Ministry of Environment, Lands and Parks?

Hon. J. Cashore: For the most part, that relates to the rangeland, not the grazing leases; being rangeland, it's Ministry of Forests.

W. Hurd: I ask this question on behalf of cattlemen in the Cranbrook area who have been advised that because of the pressure of wildlife on the range, the date for grazing has been moved back to June 1, and may even be later in the season next year. I understand that will put their industry at a severe disadvantage and may render it financially unviable. The people in that area are under the impression that these rules are set by the Ministry of Environment, Lands and Parks, because they relate to the overall effect of grazing of all animals on Crown land.

For the benefit of rendering suggestions to those who call, I'm looking for some sort of direction from the minister about who sets the date and who is responsible for determining what level of grazing among all types of wildlife is to be considered.

Hon. J. Cashore: That particular area is dealt with by the East Kootenay Trench agriculture-wildlife committee, which has been in place, I believe, for three years.

W. Hurd: One assumes that's an advisory body. Or does it contain government representation? Fine.

I have one more question about the water rate increases that were levied by the government. I recognize this isn't a Crown land issue, and if the appropriate staff are not here, we could certainly revisit it at a later date. When we were questioning the Minister of Forests about the increase in rangeland fees, he pointed out at that it was based on a market calculation for beef. I wonder if the minister could explain to us whether any such calculation is factored into the rather draconian increases in water rates for the cattle industry. Perhaps he could explain how the water rates were arrived at.

I'm sure his ministry is receiving the same letters from the B.C. Cattlemen's Association that the opposition is receiving, pointing out that they can't understand how these rates were arrived at.

Hon. J. Cashore: I believe that we should seek to answer this question when we have environmental protection staff available who are involved in the work of setting those rates. If we're able to, we will get that answer this afternoon; if not, we will get it to the hon. member.

W. Hurd: That virtually concludes the questions that I had as the critic for Lands. Whether, after a short adjournment to provide for the staff being here, we want to deal with Parks issues.... I'm at the direction of the minister.

Hon. J. Cashore: Hon. Chair, I now have Parks staff available in the House. Assistant Deputy Minister Jake Masselink has entered the chamber, so we are ready to proceed with Parks questions.

W. Hurd: One question that we attempted to raise yesterday concerns the transfer of provincial parks to the jurisdiction of regional districts and local governments. With respect to these transfers, the opposition has raised the issue of what will happen to the existing wildlife management plans and the hunting and fishing regulations. One assumes that they also are subject to change by the regional district. Does the ministry retain any control for a period of a few months or years over the regulation this type of activity?

[5:00]

Hon. J. Cashore: It would be the responsibility of the regional district after such a transfer was effected. Wildlife management plans and such would be subject to the decision-making of the new body responsible for that park. In some instances there could be specific requirements spelled out in the transfer of the park to the regional district -- but that rarely happens.

I should just add that we have an enormous responsibility in managing the parklands in B.C. In doing so, there are criteria that we look to with regard to our provincial parks. There are instances where those criteria would suggest that certain parks would be more appropriate as a regional park. Examples would be where housing in a regional district grows up and almost surrounds a park, or the situation where the

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major use of the area is by local rather than provincial residents. When we're able to make those transitions and effect those transactions, we are able to concentrate on doing the good job we are doing in the provincial park system, which, as you know, is expanding.

W. Hurd: Perhaps, then, I can just ask one question about Sooke Mountain Park, which has been raised as being subject to a transfer to the Capital Regional District. I'm sure the minister will have received submissions from wildlife groups, hunters and fishermen, who are concerned about access to that park being denied or reduced by virtue of its transfer to the regional district. Can the minister advise us whether, in his opinion, the transfer of that park to the regional district is predicated on the kinds of points he was making earlier -- being in the middle of a residential area and not suitable, for example, for hunting any longer?

Hon. J. Cashore: No, it is not surrounded by residential development; it's up against water district lands. For the information of the member for Surrey-White Rock, Sooke Mountain Park is the only remaining class B park in the province, outside of the rather unique situation with the class B park in the area of the Westmin mine within Strathcona. Strathcona, as you know, is a class A park that has had its boundaries entrenched in legislation. But there is an anomaly because of the Westmin mine, so the area surrounding the mine is defined as a class B park. Sooke Mountain Park is the only remaining class B park in the province.

W. Hurd: I have a couple of questions about plans for the Cypress Bowl Provincial Park, which I'm sure is another issue that has come to the attention of the ministry in the past year, as it has to me. Can the minister give us a timetable for a decision on the application put forward by the developer and, indeed, on the master concept plan for Cypress Bowl? I'm aware of the hearings that have been held and the considerable controversy the project has engendered. Is there a timetable for a decision on this particular development?

Hon. J. Cashore: Just to go back to the question about Sooke Mountain Park, I want to state for the record that a decision has not yet been rendered on that.

With regard to Cypress, it's difficult to give an exact timetable at this time, because we are awaiting the ombudsman's report, given that questions have been raised regarding administrative fairness in the way the planning process was handled. Until we have that ombudsman's report, we will not be able to proceed with other matters that have to be dealt with along the road to the final decision on the difficult issue of Cypress Park.

W. Hurd: Does the ministry, then, have a policy about how it deals with the transfer of land from a park jurisdiction to some other type of use? I'm familiar with the change that occurred at Red Mountain in the interior, when application was made to transfer lands from a park designation to use for expanding ski facilities. Obviously that means the status of the park has to be changed. Is that correct?

Hon. T. Perry: I seek leave to make a brief introduction.

Leave granted.

Hon. T. Perry: I have met some wonderful kids just now who are in grade 3 at Lord Tennyson Elementary School in the Vancouver-Little Mountain constituency and their teachers, Anne Ptucha and Laurie Linton. I think they're just coming into the House now. They're really delightful kids -- very happy, along with their teachers, to be back in school and having a wonderful time over here in Victoria. I would ask members of the Legislature to make them welcome. In case they're wondering, these are the budget debates on the Minister of Environment's spending.

Hon. J. Cashore: Again, each of these situations is unique to the terrain in which it happens to be located. If it's not of provincial significance, and if it is of regional significance, then we look to a regional body that may wish to negotiate a transfer of that park. But each area is looked at on its own merit.

W. Hurd: When the minister talks about merit, I'm a little confused. Once a park is designated, does he see it as being site-specific when the decision is made to declassify the area as a provincial park -- in other words, to change its usage? I believe that's the concern being expressed in Cypress: once it's redesignated from parkland to a ski hill venture, that in turn reduces or eliminates the other options that are available on parkland. Is the minister telling us that such items as public usage of this area and the types of activities will be monitored and weighed before a decision is made to redesignate it to what is really a more restrictive use?

Hon. J. Cashore: The answer is yes, we will consider access issues when we make the decision.

W. Hurd: Can the minister give us an idea, just for the benefit of the committee, how often this transfer occurs, where land is taken out of a park and designated for other use? Are we dealing with an issue here that is just specific to ski hills, or is it a situation that occurs in the province with any freque