1984 Legislative Session: 2nd Session, 33rd 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, MARCH 20, 1984

Morning Sitting

[ Page

3923 ]

CONTENTS

Routine Proceedings

University of Victoria Special Appropriation Act, 1984 (Bill 5). Committee stage.

(Hon. Mr. Curtis)

On

Section I –– 3923

Mr. Nicolson, Mr. Cocke, Mr. Blencoe

Third reading –– 3924

Resource Revenue Stabilization Fund Act (Bill 6). Second reading.

Hon. Mr. Curtis –– 3924

Mr. Stupich –– 3925

Mrs. Wallace –– 3926

Mr. Skelly –– 3926

Mr. Davis –– 3929

Mr. Nicolson –– 3930

Hon. Mr. Curtis –– 3932

Division –– 3932

TUESDAY, MARCH 20, 1984

The House met at 10:05 a.m.

Prayers.

Orders of the Day

HON. MR. GARDOM: I ask leave to proceed to public bills and orders.

Leave granted.

HON. MR. GARDOM: Committee on Bill 5, Mr. Speaker.

UNIVERSITY OF VICTORIA

SPECIAL APPROPRIATION ACT, 1984

The House in committee on Bill 5; Mr. Strachan in the chair.

section 1.

MR. NICOLSON: Mr. Chairman, we'll be supporting this section,

but I think it should be said that there is a lot of criticism about

the priority of this particular piece of educational spending. At times

I have been invited by the press to attack this particular investment

in education because it is seen as some sort of trade-off against David

Thompson University Centre. I cannot take

part in that attack, as I

believe that this is an appropriate type of educational expenditure.

But the government is doing this in only one select area, and this is

really an inconsistency in government policy, not in that of the

opposition in terms of supporting this. By that I mean that if one were

to look at the success of engineers who graduated from the University

of British Columbia last year.... I have been informed by people in

administration at the University of British Columbia that only about a

quarter of those graduates have jobs. That same argument is being used

by this government. We're talking about allowing the minister to expend

$16 million in order to expand engineering; that is not a bad priority,

but it's a little bit inconsistent with general government philosophy,

because not only are we going to be needing more engineers, but we're

going to be needing more trained professionals in other areas. To allow

the Minister of Finance to put $16 million into a special fund for this

purpose, while at the same time the government is claiming that other

faculties have to be cut back, eliminated, rationalized, etc., is

inconsistent.

I would like to say, then, on this

section that I would hope the government

philosophy would expand from this particular anomaly of government policy and

that government would tend to look at education as a whole as an investment

in the future; that the $16 million being placed here and other moneys have

to be invested; that it will not be money down the drain; that there will be

a financial return. I realize that not all of the engineering graduates at the

University of British Columbia are getting jobs this year. It's also true,

of course, that not all the teachers are going to get jobs. It's also true

that maybe not all of the people in architecture are going to get jobs or that

lawyers are going to get articling. It is an anomaly, however, when the government

says that because of the current economic climate we have to cut back in some

of these other faculties and yet we have to expand in this one. I say it's

a time for expansion and a time for investment in education.

MR. COCKE: Mr. Chairman, I just want to put one or two things

on the record with respect to this section, the only

section in the

bill, regarding the relationship of the University of Victoria to

business. As you know, UVic has signed agreements with Microtel Pacific

and Fairchild Camera, an instrument corporation. The benefits for

students, I gather, are that they have access to software to try out

their ideas, and the benefits for the companies are that they have an

extended opportunity to consider students in the program as potential

employees. Of the 56 months of the program, 24 are on the job. Both

Microtel and Fairchild are part of the multinational conglomerates of

Microtel Pacific. That's the research arm of AEL Microtel Ltd., which

is a wholly-owned subsidiary of B.C. Tel, which in turn is under the

control of General Telephone and Electronics of Stamford, Connecticut;

about 51 percent of B.C. Tel shares are held by GTE, wholly owned

subsidiaries of Anglo-Canadian Telephone Co. of Montreal and GTE

International Inc. Now Fairchild Camera is part of the Schlumberger

group registered in the Netherlands Antilles; Schlumberger's head

office is in New York, and they have subsidiaries in over 20 countries,

including South Africa, Panama, Brazil, Singapore and Hong Kong. I want

to bring that to your attention.

[10:15]

What I'm saying here is that the graduates from the UVic program

will be highly employable, but the jobs may not necessarily be in

British Columbia. So I have some concerns about this. The member for

Nelson-Creston (Mr. Nicolson) talked about access, and then egress as

well — that is what happens to students after they are through. I

believe that this particular program might very well be an employee's

dream, in terms of getting a job, but not necessarily here.

One of the further problems is that it'll probably be attractive to

wealthy males who can afford to attend. All British Columbians are

paying for the facility however. They hope to attract more women to the

course than the national average, but since the average female

enrolment in engineering is just 6 percent, that's not saying much. In

other words, even if they go to 7 percent, it's no great deal.

They project that British Columbia students will form most of the

enrolment, based on the perception that many of our students apply to

universities out of the province for programs of the type that will be

offered at UVic.

The new student assistance program, which is all loan and no more

grant, is also going to restrict access to the program, and restrict it

to the more wealthy — that is, the upper middle class and so on.

Those are our concerns. As far as I'm concerned, Mr. Chairman, as I

said yesterday and will go on saying, I certainly support this

educational opportunity. But I do wish that there was wider-ranging

support in all of education. I said that in second reading, so I won't

regurgitate that particular debate.

MR. BLENCOE: I also would like to indicate my support.

Clearly our caucus will be unanimous on this particular decision. It is

indeed a good move. Some comments by the member for New Westminster

were, I think, extremely welltaken. We will have to be particularly

careful that we ensure that it's virtually 100 percent British

Columbian, and that the

[ Page 3924 ]

jobs are indeed British Columbia-based and Victoria-based, if possible, given the situation in this community.

It would be remiss of me if I didn't comment on the remarks of the

member for Nelson-Creston. I think he is to be commended for taking the

position he has; in light of what happened recently to his community,

in terms of the David Thompson University Centre, and for being

extremely reasonable and understanding. I am sure that many of us — and

he — may wish to take an opposite position given the removal of funding

from, that very important centre in Nelson. I think it is most

unfortunate that I can see why there would be some real feeling of

abandonment by this government, to pursue $60 million in the Victoria

area and eliminate such an important university centre in Nelson. I

think the member for Nelson-Creston is to be commended for taking that

position. Certainly I thank him on behalf of my constituents in this

riding.

Mr. Chairman, I am pleased to support this bill.

Section 1 approved.

Title approved.

HON. MR. CURTIS: Mr. Chairman, I move the committee rise and report the bill complete without amendment.

Motion approved.

The House resumed; Mr. Speaker in the chair.

Bill 5, University of Victoria Special Appropriation Act, 1984,

reported complete without amendment, read a third time and passed.

HON. MR. NIELSEN: Mr. Speaker, second reading of Bill 6.

RESOURCE REVENUE STABILIZATION FUND ACT

HON. MR. CURTIS: I rise to move second reading of Bill 6, the

Resource Revenue Stabilization Fund Act, one of the few bills announced

on budget day last month. I have a few notes, Mr. Speaker, and I look

forward to the debate which will occur on this particular topic.

The purpose of the new act is twofold, in fact. The first is to give

the government the authority through the Legislature to utilize the

resource revenue stabilization fund to retire government and Crown

corporation debt and to provide the government with the authority to

require Crown corporations to pay dividends into the fund. Members will

recall that in 1982 this government introduced the Resource Revenue

Stabilization Fund Act to establish a special fund which would, briefly

stated, help. stabilize the impact of the province's volatile natural

resource revenues. I think there would be agreement on both sides of

the House, if I may presume so, that indeed we have that volatility. It

is the nature of this province. It has been for many decades. I think

it can be mitigated in the years to come.

Currently, all natural resource revenues received by the government

flow into the fund and are then transferred to the general fund —

consolidated revenue, if you wish — as required to pay operating

expenses. It was intended that in peak revenue years the fund would

accumulate balances to be drawn down in years when revenue growth was

weak, in order that we could offset the downturns which characterize

our resource-based economy, about which I have just spoken.

As members of this assembly will realize, the fiscal years since the

establishment of the resource revenue stabilization fund — that is, in

1982 — have not been strong years for the province's economy. Nowhere

is this more evident than in the province's natural resource revenues.

Although all revenues paid into the resource revenue stabilization fund

have been transferred to the general fund in each fiscal year, and the

government has launched an effective restraint program — which, I

appreciate, is not part of this bill — the province has still had to

borrow to pay for operating expenses because of the weakened provincial

economy. But as we have indicated, there is light showing on the

horizon. The time has come to expand the role of the resource revenue

stabilization fund. Although I outlined the proposed changes in the

budget speech on February 20, I would like to review just a few of the

main points in this bill and note for the members why they are required.

It is not the intention of this government that future generations

of British Columbians be burdened with payments for debt incurred to

meet our operating expenses of these recent years. So the enactment of

this bill will mean that commencing in the 1984-85 fiscal year, which

is just two weeks away, the resource revenue stabilization fund will be

used not only to smooth the effects of fluctuations in resource

revenues but also to retire direct provincial debt, as well as the

debts of the Crown corporations which are not considered to be

self-supporting — may I just emphasize that — in terms of their debt.

Debts will be retired either through payments into sinking funds set up

to retire debt at a future date or through payments to retire debt

issues which reach their maturity dates.

This bill also provides for several other changes to the resource

revenue stabilization fund. The House will be pleased to know that we

were unable to designate an acronym for this particular fund, but its

short description is RRSF.

AN HON. MEMBER: That's because Larry Bell isn't here.

HON. MR. CURTIS: Oh, he's still here.

Dividends from Crown corporations designated by the

Lieutenant-Governor-in-Council will now be paid into the fund in

amounts determined by the Lieutenant-Governor-in-Council. In future,

the government will be able to require Crown corporations to return a

portion of their profits to the government or, more accurately stated,

to the shareholders — i.e., the people of the province. It is

appropriate that the people of British Columbia receive a return on the

considerably large investments made in Crown corporations. The

obligation to pay dividends will also act as an incentive to Crown

corporation management by requiring that management to consider the

rate of return on their investments, as in any private sector operation.

There is also a provision in the act to allow the general fund to

make advances to the resource revenue stabilization fund. The purpose

of these advances will be to allow the resource revenue stabilization

fund to make debt retirement or sinking fund payments before resource

revenue has been received in a fiscal year. I should stress that all

advances from the general fund must be repaid within the same fiscal

year. I think that that is an appropriate but relatively minor measure

of reform contained in the bill.

[ Page

3925 ]

In 1984-85 this act will empower the government to make a payment into the

British Columbia Railway's sinking funds set up to retire its historic debt,

relieving the railway of a debt burden accumulated during the 1960s and 1970s.

I dwelt on this at length in the budget speech, and, indeed, the historic debt

of the British Columbia Railway was the subject — without reflecting on a vote

— of debate following the budget speech. That is one of the key elements of

this bill: to carry out that initiative announced in the budget speech.

The balance of the resource revenue stabilization fund revenues in

fiscal 1984-85 will be paid into the general fund to be used for

operating purposes of the government. The increased flexibility this

bill provides the government will allow use of the resource revenue

stabilization fund as a more effective instrument of fiscal

stabilization as well as of financial responsibility in managing the

province's finances. As I said earlier, it will enable us to relieve

future generations of the obligation to pay off debt which has been

incurred in the past.

I consider this to be a very major next step in the resource revenue

stabilization process. I commend Bill 6 to the members and now move

second reading.

MR. STUPICH: I think the question won't come quite as easily

as it did on the previous bill, because as it was easy to support Bill

5 so it is even easier to oppose Bill 6.

Interjection.

MR. STUPICH: The minister groans. I think the minister

himself, in his opening remarks — in the very first sentence, I think —

expected the opposition to oppose it, because he started out by saying

that the purpose of this bill is to give the government authority. It's

giving more and more authority to the government and taking that

authority away from the Legislature. This is an old song. Ever since

the election of May 1983, almost every bill the government has brought

in has had one clause or one

section which takes power away from the

elected representatives and transfers it to the

Lieutenant-Governor-in-Council.

[10:30]

I can understand why the government feels it's necessary to do

something about fiscal matters in the province. Certainly in the last

eight years the situation has become progressively worse year by year.

This government took over at a time when things were not too bad. There

was money in the bank. There were debts of some $4 billion guaranteed

by the government, and in eight years they've managed to increase that

to some $15 billion. For the first time in the history of the province

— since 1952 — the government has had to borrow to meet ordinary

operating expenses. The minister said during the course of his remarks

that it's his intention that money borrowed for operating expenses not

be loaded onto future generations, but be paid off promptly. It would

be great if he really intended to do that. May I remind him that one of

the early methods of borrowing used by his administration — not while

he was Minister of Finance but nevertheless a method used — was to sell

three new B.C. ferries. We're buying them back over a period of 18

years. That particular loan is going to be loaded onto future

generations for 18 years after 1976; it will be 1994-95 before that

particular loan is paid off.

For the first time in the history of the province every public building, every

government-owned building, with the exception of the one in which we are meeting

today, is mortgaged. When will those mortgages be paid off? There's nothing

here that indicates to me that the minister intends that future generations

will not be obliged to make payments on mortgages on public buildings for many

years to come.

The bill certainly does give the cabinet more power. They have had

increasing power over the last eight years, and it would seem that as

they get more power, the situation deteriorates. But it does give them

power to pay off debts. It doesn't give them any revenue to pay it off

though. There's nothing in this legislation that is going to increase

the amount of revenue available, it simply passes it from one pocket to

another. The minister. with this legislation, is saying that from here

on resource revenue will be increased, because the sources of revenue

are wider, and the revenue may be used for other purposes at the

discretion of cabinet — purposes for which it wasn't specifically

available previously, all at the discretion of cabinet. That really is

the purpose of this bill: that anything the government wants to do with

resource revenue, it may do simply by making a decision in a cabinet

room.

We are not talking about a small amount of money. Even today with

resource revenue down, the budget for 1984-85 predicts $679 million in

resource revenue, almost 9 percent of our $7.7 billion revenue

forecast. That's a significant amount of money. Even more, when the

economy does turn around and the resource revenue gets up to where it

should normally expect to be, we might be looking at 20 percent or

more, rather than 10 percent. Who knows what ideas the government might

have then for taking more power away from the Legislature and into the

hands of cabinet.

It gives the minister or the Lieutenant-Governor- in-Council the

authority to pay the debts of Crown corporations — and I believe I took

his words down correctly when I say this — "which are not normally

self-supporting." Since the minister offered that comment, I would ask

him maybe to comment on that again; I know it is with reference to

section 2(

b) or 2(c). I see nothing anywhere in the legislation.... I

am not trying to be specific about sections; I am just asking the

minister to explain in what way this legislation before us now would

limit the payment of debts to only those Crown corporations which are

considered not self-supporting. And who considers? Presumably the

Lieutenant-Governor-in-Council. Might the

Lieutenant-Governor-in-Council one day or one year say that B.C. Hydro

is not self-supporting and the next year say that it is

self-supporting? Thus the definition, it seems to me, would be subject

to the whim of cabinet to suit the needs of the day. I wonder if there

is any clarification available on that.

To draw dividends related, I think he said, to the investment.... In

the old days we used to have the minister do second reading, then

there'd be notes available which we could review, and we would be in a

far better position to quote him. Now we have to go by the notes that

we scribble down hastily. I think that was what he said. The cabinet

could ask — a sort of request or invitation that couldn't be denied —

B.C. Hydro to pay a dividend in a year when it wanted some extra money.

If that dividend put B.C. Hydro into a loss position that year, so be

it. In relation to the capital invested in B.C. Hydro, the cabinet

might say: "This year we want a 5 percent return on our capital; we

need that money; we are going into an election period and we've got a

lot of advertising to do, so we want B.C. Hydro to pay a dividend." As

I see it, there is nothing in the legislation that would stop the

Lieutenant-Governor-in-Council from demanding of any

[ Page 3926 ]

Crown corporation that they chose to consider

self-supporting in a particular year that it make a contribution to the

resource revenue fund. One of the purposes of the resource revenue fund

is to stabilize revenue. So money could be demanded from any Crown

corporation whatever. It could go into consolidated revenue and be used

for any purpose whatever, as I read this legislation. It can go both

ways at the whim of the Lieutenant-Governor-in-Council.

I can see no purpose in this legislation other than to take

authority away from the Legislature and give it to cabinet so that when

they want to tighten the screws, as they did with the budget of July 7,

1983, they can produce all kinds of evidence to show why it's

necessary. There are Crown corporations out there needing grants, just

as BCR needed $470 million to pay off debts, some of which are going to

come due 21 years from now. Just as other Crown corporations will be

able to show the same need, because every one of them has debts aplenty

— there's no problem there in showing need — the government can

increase taxes, withdraw services, all on the basis of need to meet the

budget. Then, at an appropriate time — it might just happen to be in

preparation for an election; not necessarily so, but it just might

happen that way — they could turn everything upside down and ask the

Crown corporations to return revenue to the Crown so that they could

have all kinds of money to spend on advertising campaigns and whatever

other giveaway programs they want to introduce in preparation for an

election campaign.

The minister welcomes this and says what great legislation it is.

Well, it certainly is, Mr. Speaker, for a cabinet that's trying to make

things as much as it can in favour of the government in office, to make

sure it will have complete control over government finance without

coming back to the Legislature and asking any questions, and without

even reporting back until some two years later when we finally get Public Accounts .

As I said, the legislation that was brought in yesterday could be

easily supported. The legislation brought in today can be even more

easily rejected by the opposition. It should be rejected by government

members if they have any sense of decency, but I don't really expect

that. However, the opposition certainly will oppose this legislation.

MRS. WALLACE: We didn't have our order quite lined up here.

HON. MR. PHILLIPS: You haven't got anything lined up.

MRS. WALLACE: Well, when you don't find out until five

minutes before the House sits what you're going to be talking about,

it's a little difficult to get your speakers lined up ahead of time.

HON. MR. PHILLIPS: Well, why don't you keep your troops in the House? What do you think you're paid for?

MRS. WALLACE: My old friend is there making noises as usual.

Certainly I am concerned about this bill. I am concerned about some

of the things it does. One of the questions I have for the minister....

Unfortunately, he's not in the House right now. He says this bill is

supposed to add more revenue source. As I read the old bill, it seems

to me that it adds less revenue source. The only change is that rather

than take all the income from the B.C. Petroleum Corporation, it's now

going to take the net income. As far as I'm concerned, that's reducing

the source of revenue rather than increasing it. I'd certainly like the

minister to explain how he feels this is going to provide a greater

source of revenue.

My other concern is that by doing what we're doing to this act,

we're completely changing the whole purpose of it. It should not be

called a Resource Revenue Stabilization Fund Act any more, because it's

not for that purpose any more; instead, it's for the purpose of paying

off debt. I don't want to go to too much length about this. It's been

discussed at great length in other venue's during this session. But for

the minister to say that this new bill is going to somehow mean that

we're not borrowing for operating purposes — that we're going to

relieve future generations of these heavy debt burdens — is completely

erroneous. What this bill really is, as far as the first year is

concerned, is a sneaky borrowing bill; that's what it really is. It is

proposing to take this money — $470 million worth this year — and pay

off a debt. That means that instead of a $200 million deficit in our

operating budget this year the Minister of Finance is forecasting a

$670 million deficit. So it's just a sneaky way of borrowing money — by

saying our operating costs are going to be that much in arrears this

year, when in fact we're taking $470 million and using them under this

fund. It's just not a resource revenue stabilization fund any more, and

it should not be called that. It's erroneous, incorrect. It's a

gimmick. It's a very political gimmick, as the member for Comox (Ms.

Sanford) Indicates. It's a political gimmick to somehow try to convince

the public that we have to tighten our belts and take less money for

our jobs and for everything else that we are doing; that we have to

take less in social services because we have this horrendous deficit —

$670 million worth of deficit-when $470 million of that debt this year

is strictly under this bill to pay off a debt. And debt is debt.

Interjection.

MRS. WALLACE: Yes, they are surprised. They agree that it's a

political gimmick. It's a sneaky way of borrowing money and telling the

taxpayers that they have to pay for it because it's costing more to

operate their health care system and their educational system. They

have all this terrific deficit in their operating budget, when more

than two-thirds of it is simply to be spent under this bill. It's a

sneaky way of borrowing money. It has nothing to do with revenue

stabilization, which was the purpose of this act. I am completely

opposed to it.

MR. SKELLY: Mr. Speaker, what concerns me about this bill is

that it doesn't recognize the most important debt that we have to

future generations, and that is to preserve the renewable resources

that we have in sustainable condition. What the government appears to

be doing in this one is simply creating a vehicle to invest in the

sinking funds of B.C. Rail, so that they can either pay off their debts

or else go deeper into debt. I don't know exactly what the government

has in mind for B.C. Rail. But what bothers me about this bill is the

fact that the government does not seem to have recognized the major

debt that we owe to future generations, and that is to keep our forests

in sustainable condition.

[10:45]

I was looking through the annual report of the Minister of Forests

(Hon. Mr. Waterland) for 1982-83, and looking in particular at the

figures for the Prince George region. The

[ Page 3927 ]

authorized allowable cut for that region is something like 15,287,000 cubic metres.

HON. MR. CURTIS: On a point of order, Mr. Speaker. I look to

the Chair for guidance. This bill deals with resource revenue

stabilization. I realize that one could speak at length about

resources, but I wonder if we're not straying from the purpose of the

bill.

MR. SPEAKER: Thank you, hon. member. I'm sure the member was

just about to reach the point in debate that would be relevant to the

bill before us.

MR. SKELLY: Mr. Speaker, I was just getting to the whole

point of resource revenue stabilization. The word "stabilization"

appears to me to mean something that keeps the revenues flowing in from

the resources of the province — the minister mentioned this himself in

his opening address on this bill. He mentioned the volatility of

resource revenue. Well, what we have to do in order to eliminate a lot

of that volatility is not simply keep a fund of which we invest a large

part in the sinking funds of B.C. Rail, but also use this fund to

invest in the resources of British Columbia — the renewable resources

in particular — in order to recognize the debt that we owe to future

generations in British Columbia, which the minister also mentioned.

I think the first obligation on the members of this Legislature is

to maintain those renewable resources, which provide this revenue, in

sustainable condition so that we can continue to bring in revenues to

this fund. I was just attempting to demonstrate how in one forest

resource region of the province we're not doing that, and I was using

the example of the Prince George forest region, where the authorized

allowable cut is something like 15,287,000 cubic metres. What the

government is allowing forest companies in the region to cut is 17

percent more than what is growing in the region now. According to the

ministry's annual report of 1982-83, 15,345,000 cubic metres is

committed to be cut in that region, which is 17 percent more than the

region is capable of growing. In addition, fire destroys 3,766,000

cubic metres in that region. Insects and disease are destroying another

2.5 million cubic metres of the resource. In other words, the

government is allowing the resource which provides the money upon which

this fund is based to diminish. What we should be doing first and

foremost is investing money in that resource to make sure that it is

sustainable so that money continues to come back into this fund and to

serve the purposes of the province.

A few weeks ago the federal government attempted to sign an

agreement with the government of British Columbia which would provide

something like $104 million annually for intensive silviculture, to

turn that picture around, to begin to make our forest resource

sustainable again. The government of British Columbia did not get

involved in that agreement, even though all it required was something

like a $54 million investment on the part of this government. The

federal government would match that contribution. That expenditure

would have helped to preserve the 31,000 jobs in the forest industry in

British Columbia that are currently at risk because of the government's

mismanagement of the resource.

MR. R. FRASER: On a point of order, Mr. Speaker, I was

listening to the member opposite, and I am not getting the feeling that

he's really talking about the bill, which I think he should be reminded

to do.

MR. SPEAKER: Hon. members, it is incumbent upon each of us,

particularly on second reading, to be relevant to the bill before us. I

am sure that the member for Alberni, in concluding his remarks on this

particular bill, will refer to it. This is the second time, hon.

member, that you've....

MR. SKELLY: How much time do I have left, Mr. Speaker? You're talking about my concluding my remarks.

It says here, Mr. Speaker, that revenue comes into this act out of

the Forest Act, the Logging Tax Act, the Range Act and certain other

acts, which relate to the management of forests in British Columbia and

to revenues from the forests in British Columbia. This is precisely

what I am talking about, Mr. Speaker. It's my concern about the sources

of revenue for this fund that compels me to bring this material to the

attention of the Legislature now, because we're destroying the

resources upon which this fund is primarily based. Revenues from the

forests are diminishing. It's something that we should be concerned

about if we're going to be passing a bill like this in order to

stabilize revenues in the province and to have this fund in order to

stabilize the volatility of revenues in the province — as the minister

calls it. We should be doing something more to manage the resources of

this province than we are currently doing.

People all over British Columbia are talking about the neglect that this government is visiting upon the forest resource....

MR. SPEAKER: Order, please, hon. member. I must advise you —

this is the third time — that while the points the member has to make

may be valid and relevant in another forum, unfortunately they do not

qualify under the Resource Revenue Stabilization Fund Act, a bill by

the Minister of Finance. If he's not prepared to follow the basic rules

of debate, then I will be insisting upon the member's taking his place,

and we shall go on to the next speaker, who, hopefully, will be

relevant. Having made that point, I ask the member to continue, bearing

in mind the relevant

section of rules that guide us in second reading.

MR. SKELLY: Mr. Speaker, everything I am saying is relevant

to this act, to resource revenues in this province, and to the

expenditures authorized under this act.

MR. SPEAKER: Order, please, hon. member. When the Chair

advises a member, the member is grossly out of order to countermand the

Chair's instructions in such a deliberate and clear way. The Chair has

advised the member that his remarks are not in order, and the Chair

will not tolerate a member's arguing with the Chair in such a direct

fashion. The Chair has been very free in allowing the member to

continue his speech. I advise you for the final time, hon. member, that

if you are not prepared to speak in the relevant section, on the second

reading of this bill, then I will instruct you to take your place.

MR. SKELLY: Mr. Speaker, I am speaking under this bill. What

I am saying is relevant to this bill, and I would ask you to tell me in

what way my remarks are not relevant to this bill. I am dealing with

the resources and the resource revenues upon which this bill is based.

I am dealing with the

[ Page 3928 ]

expenditures authorized under this bill. I ask you, Mr. Speaker, to tell me precisely where my remarks are not relevant.

MR. SPEAKER: Hon. member, the Chair has advised the member

that his remarks must be contained to the act itself. I am not going to

read the act to the member; the member should read the act himself.

MR. SKELLY: I've read the act.

MR. SPEAKER: I will advise the member for the last time that

he must stick to the basic information contained within the act. While

the member may have concerns about reforestation, this act is not the

place to enter upon that debate.

MR. SKELLY: Mr. Speaker, I am discussing reforestation only

as it relates to sustaining the revenues that are going into this

resource revenue stabilization fund. If we do not sustain that forest

resource, we will not get the revenues necessary to sustain this fund.

Mr. Speaker, it's not the purpose of debate in the Legislature for

members to debate with the Speaker. It's the purpose of this

Legislature for members to debate with each other about how worthwhile

this legislation is and whether it's going to serve the purpose which

the government states it's going to serve. It's the duty of members in

this Legislature to discuss whether the revenues and expenditures

established under this act are going to be met in the way that the act

discusses. I don't think, Mr. Speaker, that in the way the forests of

this province are being managed, the way the expenditures under this

act are being handled, that we are going to have the resources upon

which this fund depends in the first place. And that's why, Mr.

Speaker....

HON. MR. CURTIS: Point of order, Mr. Speaker. This bill, as

was observed earlier, is in the hands of the Minister of Finance. It

deals with the receipt of resource revenues and the disbursement of

resource revenues from this fund. I appreciate, if I may without

offending the rules, that the member wishes to speak about matters

relative to resources. I would point out that to the best of my

recollection in Committee of Supply we have not yet dealt with the

estimates of the Minister of Forests. But whether these resource

revenues are high, medium or low is beside the point. It is the

utilization of those revenues, not how large or slim they are.

MR. SKELLY: I'm talking about the utilization of those revenues.

MR. SPEAKER: The member for New Westminster on the same point of order.

MR. COCKE: On that point of order, Mr. Speaker, the Minister

of Finance made the case. He said that the question we are discussing

here is both the revenue and its disbursement. What the member for

Alberni is doing is discussing the disbursement and the necessity for a

good portion of that revenue to be ploughed into silviculture and those

other related forest needs. So, Mr. Speaker, the Minister of Finance

made the case. That's precisely what that member is speaking about.

MR. SPEAKER: Hon. members, just before I recognize the member

for Alberni, somewhere along the line we must use a little bit of

reason in our debate. If we are to engage in a wide-ranging debate on

the Ministry of Forests, for example, in a bill that contains reference

to forest revenues, then surely we lose all the rules that are before

us to guide us in debate. I have advised the member for Alberni at this

time that the debate line on which he is currently engaged is not in

order at this particular time. Hon. member, the points you wish to make

may be brought up at several other opportunities, all of which would be

in order. But at this time a full discourse or examination into the

forest sector is not in order under this, and I so rule.

MR. SKELLY: Mr. Speaker, I am talking about the priority of

expenditures under this act. The minister, in opening debate, and the

Finance critic for the official opposition, in dealing with this

legislation discussed our debt to future generations and the money that

will be paid into B.C. Rail's sinking funds. None of those things are

mentioned specifically in this bill, but they were discussed. The

Speaker did not intervene to say that they were relevant, irrelevant or

otherwise. What I'm talking about is the priority of expenditures under

this legislation, and following the debate of the Minister of Finance

and the opposition's Finance critic, what I'm saying is that there

should be certain priorities in expenditure under this legislation.

One of those priorities is to make sure that the revenues, as

discussed in the

interpretation

section of this statute, which come in

part from the Forest Act, the Logging Tax Act and other acts, are

sustainable. Otherwise why are we wasting our time talking about this

fund? If we're doing away with the very resources upon which the fund

depends, it doesn't make much sense.

[11:00]

So I'm saying that there should be a certain priority in

expenditures under

section 4, so that payments out of the fund go first

and foremost to sustain the resources and resource revenues upon which

this fund depends. That's the point of my argument, and as far as I can

see, that point is entirely in order under this bill. I don't see the

reason it's being questioned by members on the opposite side unless

they're embarrassed in some way about the priorities they have in

expending the moneys and resource revenues of the province. Those

resource revenues are declining because of mismanagement of the

resources. The money is not going to be available in the future to

sustain these resources. The government hasn't demonstrated the

priority in its budgeting, either out of this or any other fund, to

maintain those resource revenues under

section 2. What I'm saying — and

I'm entirely relevant to this bill — is that there should be a priority

in the expenditure

section on this bill to maintain those resources and

the resource revenues upon which this fund depends.

The information coming from the Ministry of Forests for the last few

months shows that stumpage revenues are declining. They're continuing

to decline even though markets are now increasing. In fact, we

generally consider the forest industry in British Columbia to be

profitable when housing starts in the States go back to 1.5 million a

year; then the profitability begins to kick in. They're now up to 1.7

million or 2 million a year, yet stumpage revenues are declining.

Federal and provincial government studies and material from the

Ministry of Forests itself shows us that the revenue is going to

continue to decline because the resources are in a

[ Page 3929 ]

state of decline. The government is doing nothing.

It is expending insufficient funds to maintain those resources and

those resource revenues upon which this fund depends. That's my major

concern, Mr. Speaker. Why, under this act, are we putting money into

the sinking funds of B.C. Rail, when we should be expending money to

maintain the renewable resources of British Columbia upon which this

act depends?

I can understand that the government members would be disturbed,

because this lack of priority has been pointed out to them on many

occasions. For example, Prof. Walters of UBC, speaking at the

Association of B.C. Professional Foresters' annual meeting, talked

about our province's forests being "gang-raped." Those kinds of

emotional terms are being used to describe the management of our

forests, the neglect this government is visiting on the forests, and

what will happen to the future revenues from our forests if the

government does not change its spending priorities to make sure that

the revenues upon which this bill is based are preserved.

Mr. Walters mentioned in his speech to the Association of B.C.

Professional Foresters that if we enter into that agreement with the

federal government — if we begin immediately — then we'll be required

to spend something like $660 million, and that the money that will come

back into British Columbia and partly into this fund will be something

like $2.4 billion. It's the best investment the government could make.

The highest priority this government should have is to maintain those

resources and the resource revenues upon which this type of fund

depends. An investment of $660 million to bring back to the people of

this province revenues of $2.4 billion is the kind of investment we as

MLAs should be supporting. Yet the government does not seem to have

that kind of priority. In this bill and in their debate on this bill,

the government does not seem to be demonstrating that kind of priority.

In addition, if those resources disappear — as they are disappearing

because they're being overcut and insufficiently protected — we are not

going to have any money or any resource revenues whatsoever to put into

this fund. That's what concerns me.

The first thing we should be discussing under this bill is the

priority of expenditure. Should we be putting that money into B.C.

Rail? Should we be using that money to pay off the debt of Crown

corporations? Or should we be using that money first and foremost to

recognize our debt to future generations, to be proper stewards of the

resources of this province and to keep those resources and their

revenues in sustainable condition? That's my major concern under this

bill.

I'm pleased that the opposition Finance critic has announced that

the official opposition intends to vote against this bill. We're voting

against it because it does not recognize proper priorities — not only

because it gives the Ministry of Finance or cabinet the right to direct

the revenues of this province behind closed doors, but also because the

cabinet does not have the proper priorities in directing those revenues

and investing them. We have an obligation to future generations that

this cabinet does not seem to recognize. I'm pleased to be on my feet

speaking against this bill, relevant to the principle of this bill,

because the government does not recognize the priority of the forests

of this province in order to sustain the revenues of the province.

MR. DAVIS: The hon. member for Alberni has tried to

generalize this debate, to wander into bordering areas and indeed into

other areas of discussion. I'd like to narrow it.

In a nutshell, my concern is the title of the bill. I agree that

there should be a resource revenue stabilization fund. In days gone by,

parliamentary governments around the world have generally required that

all funds be paid into one pot, so to speak; that no tax is labelled;

that it goes into the general revenue of the nation or the state or the

province; and that it not be sent to a particular fund or delivered

into a particular compartment and then used for a particular purpose.

That has been general policy. There have been exceptions, but that

generally has been the rule.

[Mr. Strachan in the chair.]

A few years ago we passed legislation — I voted for it; I agreed

with it — which set up a resource revenue stabilization fund. The

reasoning behind that, as I understood it at the time, was to smooth

out, as far as the availability of moneys to the Minister of Finance

was concerned, the flow of resource revenue into the budgetary process.

We've had resource revenues in this province well in excess of a

billion dollars a year. We've had resource revenues within the last

comparatively short period of down towards half a billion dollars a

year. In other words, resource revenues in this province can increase

100 percent and they can collapse by at least 50 percent. That's no new

phenomenon; it's been going on since British Columbia became a separate

jurisdiction. Resource revenues fluctuate markedly, and therefore it

makes sense to have them flow into a particular fund and averaged over

time, and then the Minister of Finance is in a better position to

develop budgets from one year to the next. In paying resource revenue

funds out to the municipalities, I would say that a stabilized fund

would be preferable to one that varies markedly from year to year. So

I'm all for the concept of resource revenue stabilization, indeed the

creation of a special fund into which these moneys flow. I can agree

with the broadening of the fund to include certain revenues from

particular resource activities which were not formerly included — in

other words, stabilize revenue from a larger number of taxes from more

resource industries.

Where I have some difficulty with the bill is that while it's

entitled resource revenue stabilization fund — I'm underlining the word

"revenue" — the bill goes on into spending or expenditure. The bill

goes beyond the subject of revenue stabilization and goes into how the

money can be spent. If one looks at the detail of the bill, you see

that the money can be spent for a variety of purposes. Retirement of

debt, for example, is not specific as to which debt can be retired and

which debt cannot. I wonder whether the intent is to make payments out

only in respect to resource activities — Crown corporations, for

example, involved in resource development — or does the wording of the

act allow payments to be made out to any Crown corporation, any debt,

whether resource related or not? That's a matter that does concern me.

I wonder, for example, if the title wouldn't more properly be Resource

Revenue Stabilization Fund and Disbursement Act. It involves spending

out of a fund as well as simply revenue stabilization. In other words,

what corporations will be involved? I gather that B.C. Rail is one.

B.C. Rail obviously is conceived therefore as an instrument for

resource development. What other Crown corporations fit into this

category in addition to B.C. Rail?

[ Page 3930 ]

I agree with the repayment or paying off of the historic debt of

B.C. Rail. I think that should have happened before now, but it is now

in process of happening. The government, of course, could just as

easily have borrowed $470 million and paid off the debt of B.C. Rail

without stipulating that it come out of the resource revenue fund. The

resource revenue fund existed a few years ago. After the legislation

was passed, resource revenues increased for a while. Then they dipped —

they fell off dramatically. That resource fund must be empty now; it

must have been empty for a while. So where does the $470 million come

from? It comes from the government borrowing anyway. So the money is

not immediately out of the resource development fund. It may compensate

the government in future. I assume the intention of the government is

to be able in the future to channel money out of the resource fund into

some other government fund in order to compensate the government for

the $470 million. That's bookkeeping — that's money out of one pocket

into another — and, as I said earlier, it doesn't concern me too much.

In addition, the government has invested, let's say, $500 million or

$600 million in the Tumbler Ridge line. Perhaps the Minister of Finance

will correct me on this, but my understanding is that that line has

been physically turned over to B.C. Rail to operate. I'd be interested

in knowing whether it is already the property of B.C. Rail. In any

case, B.C. Rail will have received or is certainly able to operate an

asset and, hopefully, to turn something of a profit on it. There was

reference in the minister's remarks to dividends being payable by Crown

corporations — I assume, resource development corporations — to the

Crown. Perhaps the minister would tell us again — I think he told us in

the House already — whether B.C. Rail, as a result of inheriting or

obtaining operating title to the Tumbler Ridge line, is now committed

to make a dividend payment in the next year or two or three of some

order of magnitude that would be at least consistent with his remarks

in the House.

But my main concern has to be: to what extent is this really a

payment-out device, as distinct from simply a stabilization account?

And if it involves payments out, to what Crown corporations? Is there a

list? Presumably the government can add to or subtract from the list by

order-in-council. Finally, relative to the Tumbler Ridge line, as a

result of the government investing in the line in the form of equity,

does the government have an understanding that dividends of a minimum

amount will flow to the government as a result of that one-time outlay

by the government?

[11:15]

MR. NICOLSON: Mr. Speaker, it is with no reluctance that I would oppose this act. The very nature of the act....

Its title is really, I think, misleading as to the true purpose of

the act. The use of the word "stabilization" would tend to indicate

that a regulation valve is being put into the flow of resource

revenues. If I could carry the hydrological analogy a little bit

further, it would tend to indicate that right now there is an overflow,

an overabundance, that the stream is overspilling its banks, and that

we want to divert some of this flow of revenue into a holding tank so

that we could in the future, when we get into difficult economic times,

put this extra resource revenue back into the necessary flow that we

need to maintain our economic system. But of course that is

preposterous. It is like seeking to build a diversion tank after

somehow there has been something else diverting the flow of revenues at

a higher point on the stream; and we find that the flow of revenue

here.... It is not a problem of containing too much and what to do with

an overabundance at this time. The real trouble that the government is

in today is that there is a shortage, there is a deficit.

I think my colleague from North Vancouver–Seymour said it very well.

Maybe he reached different conclusions than I would reach about whether

or not to support this bill, but he has said that these revenues are

not really coming into government, that resource revenues are much

lower than they have been in the past, that what would normally be a

billion dollars a year in straight resource revenues from the various

acts — from taxations indicated as revenue sources in the act — is now

more like half a billion dollars. The prospects for an increase, or a

return to the good old days of high resource revenues, are not that

great. If we look at what is happening in the United States, in terms

of.... One of the biggest returns to the province of British Columbia

was from the Petroleum and Natural Gas Act, and that was the revenues

from the export of natural gas. If we look at what is happening in the

United States today, with the deregulation of interstate gas, and also

with the incentive to drill deeper, and with the technological

breakthrough which has occurred.... Only a few years ago it was

conventional wisdom that below 20,000 feet there was no natural gas.

Today we realize that below 20,000 feet there are at least ten times as

many reserves as we have discovered in the shallow areas. In other

words, the export of natural gas to the United States is not going to

be a part of this regulation process that is going to be restored to

our economy. In the United States they are discovering new sources of

natural gas at a very high rate at depths of up to four miles, which

until five years ago were thought to be absolutely impossible, except

by a few very progressive independents in the field. So we can't look

to that.

This act is not really about stabilization or regulation of the flow

of resource revenue. Indeed, the previous act was brought in, and it

was assented to on June 7, 1982, when we were in much the same economic

problem as we're in today. The act which this act repeals was brought

in again at that time. This word "stabilization" would tend to indicate

that we were putting something away for a rainy day. If we were to

bring in a resource revenue stabilization fund act at a time in which

our gross provincial product, or gross domestic product, was expanding,

maybe at the rate of 4 or 5 percent a year, then one could say that

there might be some good arguments about whether we shouldn't just

spend everything that we're collecting, or whether we should save some

for a rainy day. However, the problem is that right now we don't have

the resource revenues.

The member for North Vancouver–Seymour said it exactly. All this act

says is that we're going to take up to the half a billion dollars that

we're collecting in resource revenues right now, and put them into the

sinking funds of the BCR this year — $470 million. So that's where it's

going to go this year. In order to replace that money the Crown is

going to have to borrow against the regular operating expenses of the

provincial government. We're going to have to borrow to pay for the

day-to-day programs of government. This is the kind of thing that has

not gone on since about 1952 or 1953 in this province — not under three

very separate administrations.

Mr. Speaker, the disbursements under this act distinguish this act

from the previous act that it repeals. Both claim to have the purpose

of stabilizing the annual growth of revenue paid into the general fund.

But I would submit that the growth

[ Page 3931 ]

of revenue paid into the fund depends upon the

amount of revenue that is generated. Certainly, as my colleague the

member for Alberni (Mr. Skelly) has pointed out, with the present

practices in the Forests ministry we're not going to see any growth

there to be regulated. It's going to be a further diminishing source of

revenue. In natural gas, which is probably the most important, the

prospects are very bleak. Indeed, even if we return to a normal growth

in gross provincial product, because of government policies of

supporting noneconomic coal ventures — that is, coal ventures that

cannot be done by the private sector so they have to be bolstered by

subsidy from the public sector — we have forgone taking resource

revenue from the coal industry. So there is no growth of revenue here

to regulate or, stabilize. The government's policies really have been

to even diminish resource revenues or, in other cases, to rely upon

expansion of certain growth resources. Anyone could have predicted that

eventually the United States was going to have to deregulate natural

gas, but this government never listened — just as years ago people like

Dr. Morton Shulman predicted the government was going to have to get

out of the business of regulating the price of gold. People who

listened to Dr. Shulman, an NDP member of the provincial parliament,

benefited handsomely. British Columbia might have benefited handsomely

had they listened to the people who pointed out the obvious: that gas

was going to be deregulated in the United States, with very deleterious

effects to the revenues of the province of British Columbia.

It is not a matter that we have to compete....

HON. MR. CURTIS: On a point of order, Mr. Speaker, earlier in

this debate — looking for the guidance of the Chair — I felt that it

was appropriate. This deals with the receipt and disbursement of

revenues from resources. It seems there might be other opportunities to

discuss what actions government should or might take with respect to a

variety of revenues; once they are received, whether at a low, medium

or high level, this says where they go, how they are utilized and how

they are disbursed. I know the explanatory note is not part of the

legislation, but it speaks essentially of the disposition of the funds.

I'm not talking about resource policy. We are speaking in this bill

about the revenues which flow from those resources.

DEPUTY SPEAKER: Thank you, the point of order is well taken.

The principle is financial direction; the bill is, for that reason, in

the hands of the Minister of Finance. Debate regarding the resource

would not be relevant since the Minister of Finance does not have

responsibility for the resource. The Minister of Finance is responsible

for direction of revenue, and debate on that principle is in order.

MR. NICOLSON: Then before I continue my speech, Mr. Speaker,

I would raise a point of order that this bill is out of order, as it

appears not to be within the scope of the Minister of Finance to

stabilize the annual growth of revenues. Would you so rule?

DEPUTY SPEAKER: The bill as presented is in order, and debate

will continue. It's clearly in the hands of the Minister of Finance. It

deals with financial direction and cannot deal with the resource.

MR. NICOLSON: Mr. Speaker, I wouldn't do such an honour as to

even challenge such a ruling, or such damage to the House as to have

such a ruling enshrined in the rulings of the House. I'm trying to

protect the Chair, as a matter of fact.

I would suggest then that when we get into committee, maybe the

minister would like to bring in an amendment to the title removing the

word stabilization, and changing and clarifying it. I would suggest

that clause 2(

a) be amended and brought into line with some of the

things that have been said about the bill. I can see in this bill why

the government would want to do this. This is a government bill, a new

government power, which can now be used to pay off debt in any Crown

corporation that the government wants to sell and privatize. If it is a

$1 million or $2 million debt load in some little Crown corporation

that they want to sell to some of their friends, as they have been

doing.... If they want to reduce the debt load of a particular

corporation before dumping it, they can simply disburse these moneys.

As the member for North Vancouver–Seymour has said, the government

is simply trying to bring in a means whereby they can pay off Crown

corporation debts from what would appear to be an abundant source —

that is, resource revenues. What the connection is, to people

experienced in the Legislature, is certainly something that escapes

him. As the member for North Vancouver–Seymour says, it is simply

bookkeeping. The government is going to take the resource revenue,

which is now down to about a half a billion dollars per year, and

disburse that into reducing debt in some particular Crown corporation;

and the government will have to borrow against the regular operations

of the province. The continuation of this act, then, is simply a way of

creating government borrowings without resort to the Legislature.

[11:30]

For instance we have had an annual debate on B.C. Hydro in this

House, and it goes back to the days of W.A.C. Bennett. Once or twice

the government has tried to hide that bill as just one

section of an

omnibus bill, but mostly that important decision, as it involves

usually something like $600 million or $800 million or half a billion

dollars, has been debated in the House. There has been an almost annual

opportunity for members of this House to talk about the disbursement of

the wealth of this province, which has been through direct borrowing,

into B.C. Hydro.

This act will circumvent that. This act will mean that if the

government resource revenues are high enough and if in a particular

year there might be some very thorny political subject such as, let's

say, Site C when it was at the height of its political concern.... If

the government did not want the Site C debate to take place, it could

then choose that particular year to feed B.C. Hydro its money through

this vehicle. It might still have to go and do direct borrowing for the

B.C. Systems Corporation or some other corporation. Mr. Speaker, this

bill does circumvent the Legislature. It gives the government the

opportunity not to embark upon any kind of a regular policy. The Crown

corporation that could receive this kind of largess could change. This

year it happens to be the BCR. Next year it could be B.C. Hydro — if

they don't need an increase in borrowings of $1 billion, and I don't

think they will. In another year it could be something else. This is

most irregular.

The title does not describe what is really happening here. It is not

a Resource Revenue Stabilization Fund Act: it is more of a resource

revenue manipulation fund act. I think that it does not really do the

dignity of this House of government

[ Page 3932 ]

or the esteem in which politics is even being held

in the world today a great deal of good to bring in another transparent

piece of legislation whose purpose is not financial, not economic, but

purely political.

HON. MR. CURTIS: The overwhelming support of the government House Leader this morning is more than I am prepared for.

The history of this bill — or the roots, if you will — as I

indicated in opening second reading debate, were first of all the

resource revenue stabilization account, which was identified about

three to four years ago; I'm subject to correction. That was an account

established by the Ministry of Finance pending passage in this

Legislature of the bill which is now being repealed and re-enacted. I

refer to the resource revenue stabilization fund, which was assented to

on June 7, 1982. And now this bill.

A few remarks in response to some of the comments which were made. I

would very much like to speak about stumpage revenue, but having stood

on a point of order when the member for Alberni (Mr. Skelly) was

speaking, I will simply retain that information possibly for the use of

the Minister of Forests (Hon. Mr. Waterland) when his estimates are

called in Committee of Supply. On the Tumbler Ridge branch line, about

which the member for North Vancouver–Seymour (Mr. Davis) asked, that

rail line is currently owned and operated by the British Columbia

Railway. I believe that was what the member indicated. Regarding

payments from this fund when it is established and takes effect in the

coming fiscal year, there is no restriction on payments to retire

public direct or guaranteed debt. But I say to the House that the

stated intention is to retire debt which is not self-supporting.

Interjection.

HON. MR. CURTIS: Stated earlier and restated today, Mr. Member.

After the British Columbia Railway debt which was alluded to

specifically on budget day and again in introducing second reading,

there is the opportunity given to the executive council to repay direct

debt and possibly debt incurred for social capital purposes such as

hospitals and schools.

There were also a couple of comments with respect to the title of

the bill. One member indicated that the word "disbursements" should be

added. I would simply note that the consolidated revenue fund, a fund

which is historic in this province, is a fund from which all

disbursements are made. I respectfully suggest, therefore, that there

is no need for the inclusion of the word "disbursements" in the title.

The stabilization question. By in future excluding resource revenue

from general fund revenues, the government's operating expenditures

will not be as dependent on the volatile revenue source. I noted with

interest that members on both sides acknowledged the nature of resource

revenues, in this province, whether under this government, the former

government, the government before that, or going back over many

decades. It is a volatile source of funds for the government of the

day, with expansion and decline of markets. So we will not have the

same degree of dependency on that source of funds which can swing so

dramatically in terms of expansion and contraction of the economy. In

future, any fluctuation in resource revenue will affect only the amount

of debt the government can retire. It will not affect the operating

expenditures which the government can make, and which the government of

the day would present to this House to be voted on in the usual manner.

I have a couple of other points regarding stabilization of resource

revenues paid into the general fund. That stabilization factor has not

been abandoned; it's been given a lower priority. In future, when

non-self-supporting debt has been repaid, the fund will continue as a

stabilization fund.

I started these closing remarks by pointing out that this is not a

dramatic change in this government's policy when one considers that

there was announced some time ago the establishment, first of all —

because we lacked the legislative authority — of a resource revenue

stabilization account. That was simply an identification within the

general parameters of the consolidated revenue fund. Then we came to

the House and received authority to actually establish the resource

revenue stabilization fund, the 1982 bill. This one goes just that much

further. It is a natural progression, in my view.

I want to thank my colleagues in government. While they were not

aware of the precise measure that was going to be introduced in Bill 6,

insofar as it was a budget-day bill, I certainly want to thank my

colleagues on this side of the House for their support of the extension

of this principle. I think that it is an important measure for us to

have taken, and to restate today. I look forward to answering more

detailed questions to the best of my ability when this particular bill

is called for debate in committee.

Mr. Speaker, I move second reading of Bill 6.

[11:45]

Motion approved on the following division:

YEAS — 28

McCarthy

Nielsen

Gardom

Smith

Bennett

Curtis

Phillips

A. Fraser

Kempf

Mowat

Waterland

Schroeder

McClelland

Heinrich

Hewitt

Richmond

Ritchie

Pelton

Johnston

R. Fraser

Campbell

Strachan

Veitch

Segarty

Ree

Parks

Reid

Reynolds

NAYS — 14

Macdonald

Barrett

Cocke

Dailly

Stupich

Nicolson

Sanford

Skelly

Brown

Lockstead

Wallace

Mitchell

Rose

Blencoe

Division ordered to be recorded in the Journals of the House.

MR. NICOLSON: Mr. Speaker, on a point of order, I draw your attention to the Orders of the Day

under "Meetings of Committees." I note that four committees are

proposed to meet when the House is in session. I'm not aware of any

dispensation which has been granted by the House for committee

conveners to convene a committee when the House is in session.

HON. MR. GARDOM: The point is well taken. We were aware of it, Mr. Speaker. We were proposing to request leave

[ Page 3933 ]

on the days in question. But in order to save time,

I would request leave today for each of these committees to sit, as

indicated in the order paper, while the House is in session.

MR. SPEAKER . Hon. members, I will entertain that at the conclusion of

the motion by the Minister of Finance, who now moves....

HON. MR. CURTIS: I'm sure it was not intended as a diversionary tactic, Mr. Speaker.

Bill 6, Resource Revenue Stabilization Fund Act, read a second time

and referred to a Committee of the Whole House for consideration at the

next sitting of the House after today.

HON. MR. GARDOM: I request leave, as indicated a moment ago.

MRS. WALLACE: Is the agriculture committee included to meet on Thursday?

MR. SPEAKER: Hon. members, the debate we're engaged in at

this time could possibly best be handled outside the House by the

respective Whips or House Leaders. Debate on this would certainly be

best discussed....

MRS. WALLACE: Yes. On the point of order, I have found the place. Thank you, Mr. Speaker.

I am somewhat concerned to see the agriculture committee listed

there, inasmuch as none of the three members from the opposition are

able to be present at that time. I so inform the convener.

MR. SPEAKER: Leave is requested, hon. members. Shall leave be granted?

Leave granted.

Hon. Mr. Gardom moved adjournment of the House.

Motion approved.

The House adjourned at 11:51 a.m.

[ Return to Legislative Assembly Home Page ]

Copyright © 1985,2001: Hansard Services, Victoria, B.C., Canada