1983 Legislative Session: 1st 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 )

THURSDAY, AUGUST 11, 1983

Afternoon Sitting

[ Page

767 ]

CONTENTS

Routine Proceedings

Oral Questions

Reappointment of Mckim Advertising. Mr. Cocke –– 767

Sabotage at Riverview Hospital. Mr. Reynolds –– 768

Pornographic filmmaking in Victoria. Ms. Brown –– 768

Privatization of provincial campsites. Mr. Mitchell –– 768

Human rights. Mr. Gabelmann –– 769

Export of power to U.S. Mr. Lauk –– 769

Motions and Adjourned Debates on Motions

Motion 2 (Hon. A. Fraser)

Hon. Mr. Phillips –– 770

Mr. Hanson –– 772

Mr. Michael –– 774

Mr. Lauk –– 777

Mr. Segarty –– 781

Mr. Rose –– 786

Hon. Mr. Rogers –– 789

Hon. A. Fraser –– 790

Division –– 791

Appendix –– 791

THURSDAY, AUGUST 11, 1983

The House met at 2:06 p.m.

Prayers.

HON. MR. GARDOM: I'd like all hon. members to bid a special

welcome to two visitors to what we consider the best part of Canada and

the Pacific Northwest: Mr. and Mrs. Joseph J. Schipp of New South

Wales, Australia. Mr. Schipp was elected to the Legislative Assembly of

New South Wales in 1975, and is opposition spokesman on local

government and lands. I'd like all members to bid them a very cordial

welcome.

MR. BARRETT: Mr. Speaker, it is not often that I introduce to

this House members of the Social Credit Party, so when I do, it is a

moment of great occasion. Today I would like the House to welcome the

unsuccessful nominee for a Social Credit nomination in the great

Vancouver–Point Grey riding. Had she been successful, things would've

been different here. I would like the House to welcome someone who

still uses the ferry as she does her community work: Diane Hartwick.

HON. A. FRASER: Mr. Speaker, in your gallery today we have

some distinguished visitors: first of all, Mayor Gordon Feyer from the

community of Masset on the lovely Queen Charlotte Islands; we have as

well Hon. Jim Garner from the great province of Saskatchewan, Minister

of Highways and Transportation, and his executive assistant, Ms.

Nicholas. I'd like the House to welcome them.

MR. HOWARD: We all in this chamber know how valuable and

helpful constituency secretaries are. We have the pleasure today of

having a constituency secretary visit us from Terrace, Mrs. Norma

Randle, and her husband Croft Randle. I'd like the House to give them

an especially appreciative welcome.

MR. REYNOLDS: I wouldn't want the Leader of the Opposition to

be accused of being against motherhood. I have a guest in the members'

gallery, Mr. Speaker, Mrs. Nan Hartwick, the mother of Diane Hartwick.

I wish the members would make her welcome. Nan's son Warren is also in

the gallery, and I'd like you to make him welcome. Just to let the

Leader of the Opposition know, it was the election before that Diane

ran in; this election she helped me and got me elected and did a very

good job.

HON. MR. RICHMOND: In the precincts today are eight Scouts

and three leaders from the 1st Dallas-Kamloops troop, who are attending

the Sooke jamboree. They are led by their troop Scouter Mr. Ric Laidlaw

and troop leaders Fran Laidlaw and Margaret Antenbring, and I'd like

the House to make them welcome.

MR. ROSE: It's my pleasure today to introduce Mrs. Anne

Chauvel and party from Port Coquitlam. She's a longtime hard worker in

my constituency organization — for the best party in my riding.

HON. MRS, McCARTHY: Mr. Speaker, in the gallery today is a very good

community worker from the city of Vancouver. He has been elected to city council

and the school board, and served both bodies extremely well. I would like the

House to welcome a professor of mathematics from the University of British Columbia,

Nathan Divinsky.

[2:15]

MR. LEA: I have a number of guests to introduce today. The

first guest that I would like to introduce is one whom I'm sure all of

us on each side of the House can heartily welcome: a Social Credit

organizer and the mayor of the community of Masset on the Queen

Charlotte Islands, Mr. Gordon Feyer. Secondly, some young friends of

mine are here: from the city of Victoria, Chris Dorsey; and from

Kamloops, Candice Digeso and Ron Lepin. I would ask the House to make

all of these people welcome.

MR. MICHAEL: I would like to introduce to the House today

three people sitting in the gallery. The first is the most attractive

girl in the constituency of Shuswap-Revelstoke, my wife Dilys. With her

are two U.S. citizens who are spending some time in the beautiful city

off Victoria, and spending those valuable U.S. tourist dollars: Paul

and Nellie Skidmore from Mt. Vernon, Illinois.

HON. MR. ROGERS: Would the members please welcome the Hon.

Dan Lang, the minister responsible for mines in the Yukon Territories,

who is with us today.

Oral Questions

REAPPOINTMENT OF McKIM ADVERTISING

MR. COCKE: Mr. Speaker, may I direct a question to the

Provincial Secretary. I would ask the Provincial Secretary if McKim,

the notorious advertising agency, has been reappointed recently to the

government service as agent of record for all government service.

HON. MR. CHABOT: First of all, I'd like to take issue with

the first statement, the word "notorious." It might be notorious in

your own narrow view, but not in the broad concept. I want to say that

that matter is a matter that would have to be investigated. I can't say

at this time. I'll have to examine it to see whether contractual

arrangements have been established with McKim Advertising.

MR. COCKE: Mr. Speaker, may I direct a question to the

Attorney-General. In view of what we've just heard, will you please

call the police on this matter?

HON. MR. SMITH: Whether in view of what I've just heard or in

view of anything else, I've said in the House many times that the

matter of the auditor-general's report is being investigated by an

official — not a political person but an official in my ministry; not

by a partisan person — and that the resources of the criminal justice

system will be totally utilized as the facts and circumstances point

to. That will be done. Day after day and week after week the question

keeps being asked. There is no tardiness or slowness to investigate

this matter at all, just an unwillingness to build it into a matter

such as the gentlemen opposite wish to build it into, until the facts

warrant a further phase of the investigation.

[ Page 768 ]

MR. COCKE: Mr. Speaker, I draw to the minister's attention

that this is day 23. The shredders can be working for 23 days. It's not

good enough. Will the minister rethink this question?

SABOTAGE AT RIVERVIEW HOSPITAL

MR. REYNOLDS: My question is for the Attorney-General also, Mr. Speaker. This morning's Province

reports that $100,000 damage has been done to the laundry which serves

the Riverview Hospital for the mentally disabled, and the supply and

services administrator, Mr. Don Thomson, is reported as saying: "It was

deliberately set up; it was no accident; those hoses were pulled out of

the racks and turned on. They have fairly heavy valves." He is also

reported to have said that none of the 65 unionized laundry workers

showed up for work in the morning. Has the Attorney-General decided to

investigate this absolutely disgusting and contemptible assault on the

mentally handicapped, with a view to ensuring that those responsible

are brought to justice and that appropriate criminal charges are laid?

HON. MR. SMITH: I thank the member for West Vancouver–Howe Sound for his question, and the answer is yes, I've asked for a report on....

SOME HON. MEMBERS: Call the police.

HON. MR. SMITH: Mr. Speaker, I guess the gentleman opposite would like the police brought into every occurrence.

MR. BARRETT: No, just the things you pick.

MR. SPEAKER: Order, please.

HON. MR. SMITH: I have asked for a report on the damage at

Riverview. I will bring the information to the member, and the answer

back to the House. I thank the member for the question.

MR. REYNOLDS: You know, Mr. Speaker, it's interesting how the

NDP like to put businessmen in jail, but don't like it when we ask

questions about union leaders.

SOME HON. MEMBERS: Oh, oh!

MR. BARRETT: Name names!

MR. REYNOLDS: You're just a bunch of gutless hypocrites.

MR. SPEAKER: Order, please.

SOME HON. MEMBERS: Point of order.

[Mr. Speaker rose.]

MR. SPEAKER: Order, please. Hon. members, before I entertain

the point of order, I am asking for the member to withdraw the remark.

I must ask that member to withdraw that remark made in this chamber.

MR. REYNOLDS: Mr. Speaker, I can't withdraw it. It's the truth.

MR. SPEAKER: Hon. member, failure to withdraw the remark

leaves me with no alternative. I ask the member for the final time to

withdraw the remark made in this chamber. Will the member so withdraw?

MR. REYNOLDS: No, Mr. Speaker.

MR. SPEAKER: I ask the member at this time to leave the chamber.

[Mr. Speaker resumed his seat.]

PORNOGRAPHIC FILMMAKING IN VICTORIA

MS. BROWN: Mr. Speaker, my question is also to the

Attorney-General. It has to do with a report that pornographic films

are being made in the city of Victoria. Under

section 159 of the

Criminal Code, it says: "Everyone commits an offence who makes, prints

or publishes any obscene written matter, picture, model, phonograph or

any other thing whatsoever." In view of this, has the Attorney-General

decided to investigate the matter of making a pornographic film in

Victoria?

HON. MR. SMITH: Well, if I had a few more details in that

question I might be able to give a more definitive answer. But

honestly, Mr. Speaker, I have absolutely no idea what the member is

specifically talking about. She may be talking about a press report of

the manufacture of a film, but if she would bring me the information on

the allegation I will certainly have it looked into. I'm not aware of

what she's specifically referring to.

MS. BROWN: The police were asked about this report. They

indicated that they have in fact opened a file. However, they are not

prepared to do anything about it until the film is in distribution.

Under the Criminal Code the very making of the film is an offence.

That's what I'm asking the minister. Has he contacted the police to

look at their files? Has he instructed them to proceed against this

particular company? Is there any investigation at all going on through

his own department as to this film which is now being made in Victoria?

HON. MR. SMITH: All I can do is to take the question as notice and give a report back.

MS. BROWN: When the minister takes that question as notice, I

wonder if he would also investigate the person who is putting up the

funding for this particular film, to see whether there is any profit

being made on the exploitation of women through this act.

PRIVATIZATION OF CAMPSITES

MR. MITCHELL: My question is to the Minister of Lands, Parks

and Housing. Yesterday the minister stated that the government has been

open and upfront about the privatization of facilities in provincial

parks. I'd also like to say that I like to be upfront too. Since his

statement I have received a number of phone calls, and because of that

I would like to ask: can the minister assure the House that the

government has decided not to privatize any of the public campsites

within the province?

HON. MR. BRUMMET: The answer is no.

[ Page

769 ]

MR. MITCHELL: Could I have a clarification, Mr. Speaker? Is the answer

no, they will not or do not intend to privatize campsites, or is the answer

that he will not give his assurance to the House and to the people of B.C. that

they will or may privatize the campsites in the province?

HON. MR. BRUMMET: My answer was to the question the member

asked, which was, I believe: can the minister assure the House that

there is no intent of any more privatization? And I said no.

HUMAN RIGHTS

MR. GABELMANN: Can the Minister of Labour cite any occasion

on which he or any authorized spokesperson for the Social Credit Party

revealed the government's plans to destroy the apparatus of human

rights administration and gut the Human Rights Code during or before

the 1983 election campaign?

MR. SPEAKER: Part of the question is in order, hon. member.

HON. MR. McCLELLAND: I'm not sure I understand the question, but if it is whether I have had any advice....

AN HON. MEMBER: You know what the question is.

HON. MR. McCLELLAND: No, I don't.

MR. GABELMANN: I'll put it in different words. Can the

minister tell us on what occasion or occasions the public was advised

prior to May 5, 1983, that the Human Rights Code and administration

would be gutted? What days and by whom?

HON. MR. McCLELLAND: Well, first of all, there is no gutting

of the human rights programs in this province. As I've said before, we

will have the strongest human rights legislation in Canada once this

new program is put in place. Secondly, I'm sorry, perhaps it's just

that I'm not listening that carefully or that the member isn't

explaining himself, but I don't understand the question at all.

MR. GABELMANN: I'm attempting to determine the basis on which

the government feels it has a mandate to have taken the actions it has

taken in respect of human rights in this province. What is the basis of

that mandate? When were those promises made before May 5?

[2:30]

HON. MR. McCLELLAND: There were no promises made before May 5 — not

by me or by any authorized member of my government that I'm aware of. The

first part of the question is much more easily understandable — now. The member

asked, in effect, why we've taken the action we've taken. Since becoming

the minister responsible for the Human Rights Commission about a year ago I've

done an exhaustive review of the operation of both the commission and the human

rights branch, as I have with every other operation under the control of the

Ministry of Labour, and I came to the conclusion, as I've said publicly

on a number of occasions, that the system was not working, that justice wasn't

being served, that justice delayed was justice denied, and that a totally new

system was necessary in order that we could move in a very meaningful way towards

the day when we wouldn't have to worry about discrimination in this province.

EXPORT OF POWER TO U.S.

MR. LAUK: I have a question to the Minister of Energy, Mines

and Petroleum Resources, Mr. Speaker. Sometime in the last few weeks

the minister has, I believe, indicated that he may abandon

long-standing provincial policy that spans several administrations and

allow B.C. Hydro to export power to the United States under long-term

contract. In view of the fact that such contracts could not be easily

broken and that long-term contracts would thus be a permanent

alienation of that renewable energy resource, has the government

decided before making that policy change final to have a public hearing

to receive submissions and information as to the long-term effect of

such permanent alienation?

HON. MR. ROGERS: It's very early on in the game even to consider such matters. Therefore the answer to your question is no.

Orders of the Day

HON. MR. GARDOM: Mr. Speaker, I call Committee of Supply, and

on behalf of my colleague the Minister of Consumer and Corporate

Affairs (Hon. Mr. Hewitt), I adjourn debate until the next sitting

after today.

Motion approved on the following division:

YEAS –– 30

Chabot

McCarthy

Gardom

Smith

Curtis

Phillips

McGeer

A. Fraser

Davis

Kempf

Mowat

Waterland

Brummet

Rogers

Schroeder

McClelland

Heinrich

Hewitt

Richmond

Michael

Pelton

Johnston

R. Fraser

Campbell

Strachan

Veitch

Segarty

Ree

Parks

Reid

NAYS — 18

Macdonald

Barrett

Howard

Cocke

Dailly

Lea

Lauk

Nicolson

Gabelmann

Skelly

D'Arcy

Brown

Hanson

Wallace

Mitchell

Passarell

Rose

Blencoe

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

HON. MR. GARDOM: I would call Motion 1 standing in my name on the order paper, and adjourn debate until the next sitting after today.

Motion approved on the following division:

[ Page 770 ]

YEAS — 30

Chabot

McCarthy

Gardom

Smith

Curtis

Phillips

McGeer

A. Fraser

Davis

Kempf

Mowat

Waterland

Brummet

Rogers

Schroeder

McClelland

Heinrich

Hewitt

Richmond

Michael

Pelton

Johnston

R. Fraser

Campbell

Strachan

Veitch

Segarty

Ree

Parks

Reid

NAYS — 18

Macdonald

Barrett

Howard

Cocke

Dailly

Lea

Lauk

Nicolson

Gabelmann

Skelly

D'Arcy

Brown

Hanson

Wallace

Mitchell

Passarell

Rose

Blencoe

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

HON. MR. GARDOM: I would call Motion 2 standing on the order

paper in the name of my colleague the Minister of Transportation and

Highways (Hon. A. Fraser).

MR. SEGARTY: Mr. Speaker, I beg leave to make an introduction.

Leave granted.

MR. SEGARTY: It is my privilege to introduce to you Doug

McDonald from Grasmere Industries, Grasmere, British Columbia. He's in

your gallery today and I would like the House to welcome him.

[2:45]

HON. MR. PHILLIPS: Mr. Speaker, before the debate adjourned

prior to the morning break I was making the point about the British

Columbia Railway and how it will be affected by changes to the Crow

rate, but before I get into my further deliberations and the couple of

more points I'd like to make, I'd like to apologize to the people in

the gallery for the little games which are being played by the

leaderless opposition wasting the taxpayers' time and money. This is

just an indication of what normally goes on in the Legislature.

MR. LAUK: On a point of order, Mr. Speaker. The minister,

while you were momentarily distracted on business of the House, I'm

sure, was reflecting upon a past vote — as a matter of fact, two past

votes — and reflecting upon my right under standing orders to call for

divisions. Those remarks are totally out of order.

MR. SPEAKER: Hon. members, when we're discussing a motion

before us we are limited to certain debate, and reflecting on a vote,

as pointed out by the member, certainly is not appropriate.

HON. MR. PHILLIPS: Certainly, Mr. Speaker, I'll withdraw my

remarks about the actions of the little leaderless group opposite and

just let the gallery see. Their actions, I guess, speak for themselves,

so I'll withdraw because I certainly wouldn't want, in any way, to take

away the rights of the second member for Vancouver Centre — a member of

this Legislature — to play his silly little games.

I was very interested in watching the actions this morning of the

socialists opposite in standing in this Legislature and saying that

they were against the Crow rate because they think it's going to hurt

the farmers. The truth of the matter is that if there are not vast sums

of money spent on the western Canada transportation system, it will be

not only the farmers in British Columbia who will suffer but the

farmers of all western Canada. So as usual, because the socialists

opposite are in bed with all the union leaders, and the union leaders

really don't cotton to the work with the agricultural community, I

suppose they're taking the stand as some little sop to try and say

they're supporting the agricultural community here in British Columbia.

But again, Mr. Speaker, I want to point out to you that the Crow

rate affects more than the grain farmer. I want to stand here this

afternoon and support the hog producer for a better transportation

system and fairer rates. I want to speak on behalf of the cattle

producers in western Canada, in the Okanagan Valley, in the Peace River

area and all over British Columbia, because when I support changes in

the Crow rate I speak for those other commodity producers in our

agricultural community who have been subject to higher freight rates

because of the ancient Crow rate and the special rate given to the

wheat farmers in western Canada. I want to speak to the poultry

producers....

MR. MITCHELL: Talk about the land grant, too.

HON. MR. PHILLIPS: I'll talk to you about the land grant in

just a moment, my friend. I'll talk to you about anything you wish to

talk about in this Legislature. I'll prove just how right this little

government is and why we're government and how wrong you are and why

you're in opposition. I'd be happy to talk about anything you want to

talk about, my friend.

There are a number of other commodity producers in our agricultural

community who have been suffering, not having the same freight rates as

the grain producers. What the changes to this Crow rate will do is put

all agricultural producers on an even economic footing.

We used to bring pork sides from Red Deer, Alberta, down to

Fletcher's in the lower mainland here, process them and ship them into

the overseas market. They didn't have any special ancient Crow rate;

they used a trucking system. We all paid for it. So the changes to the

Crow rate are going to put all agricultural commodity producers on an

even footing.

What bothers me about the Crow debate, which has been taking place

now for some eight years, is the fact that what should be a commonsense

economic decision has become a political football. As a long-time

Canadian, it bothers me that politicians would use something that is so

obvious, so natural and something that indeed has to be changed. That

they would use that commonsense decision.... By the way, that

commonsense decision is supported by a large number of grain producers

in the western provinces. It's supported by a large number of ones whom

I have personally talked to.

I'll tell you, my friends, I have talked to politicians who have

told me confidentially: "Oh, we know the Crow rate has got to go, but

we don't dare support it." That's not being a

[ Page 771 ]

good Canadian, and that's a disgrace to being a politician. I'll

tell you, that is why this government made a decision in 1976 that the

Crow rate must go and has stood firmly and solidly behind that

decision. That is why this little member here from the South Peace

area, one of the great grain producing areas in the world, opposed by

the farmers' union, stood solidly during the election campaign in the

heat of the battle and said: "I'm a Canadian. The Crow rate must go in

spite of all opposition." That's the way politicians should act. That's

the way this government acts: make the decision and follow through

because it's good, not get on a little short-term political bandwagon.

I guess when you're a member of a party — like the socialists are —

that is declining in popularity from 26 to 19 to 16, and going down

every day, you'll hitch your little hat on any little star to

try....

Interjections.

HON. MR. PHILLIPS: It's very interesting for me to listen to

those leaderless socialists over there. I listened with a great deal of

interest during the election campaign when that lame-duck leader was

down in the southeast part of the province. He was talking to the coal

producers down there and telling them what a bad bunch the Social

Credit government was because we were opening up a new transportation

system and new markets to the world and putting together new....

And he said: " Oh, that Social Credit government are going to kill you

southeast producers." He didn't seem to realize that without some

changes in the Crow rate the transportation system that serves those

southeast coal producers will not be able to get their coal to market.

The system is overloaded now. As a matter of fact, mining companies

have come to me during the last two or three years and said: "Look, we

would like to put a new mine together. We know we can sell the coal. We

would like to put the capital investment in the mine. We would like to

hire the people, make the jobs, but we can't do it because we've gone

to the Canadian Pacific Railway and they've said that they will not be

able to accommodate our additional shipments." Without changes in the

Crow rate, that is what will happen. So I fail to see how the

socialists opposite can be against the changes to the Crow rate. But

they're being their typical selves, because they didn't come up with an

alternative.

Interjections.

HON. MR. PHILLIPS: Oh, typical old socialists. Just be

against everything. Never come up with a viable alternative. Never come

up with another proposal. Never say how it could or should be done.

Just negative harping, carping critics. That's all they are.

[Mr. Strachan in the chair.]

Before closing, I want to make a couple of points with regard to the

British Columbia Railway and how it will be affected by the Crow rate.

The act as it is written gives no recognition to the role played by the

British Columbia Railway in supporting the agricultural industry of

northeastern British Columbia. I think that is wrong. I think there

should be some accommodation, and before I sit down I will explain how

this could be done.

I outlined this morning at some length the value of the great

British Columbia Railway and how it could play a major role in moving

the products of both northeastern British Columbia and northwestern

Alberta into those new facilities presently being built at Prince

Rupert. I also want to remind you that the B.C. Railway can also

accommodate the movement of grain from other parts of Alberta and

Saskatchewan through the Prince George exchange, and down on the B.C.

Railway to the elevators on the North Shore. As you know, I'm very

proud of that great little British Columbia Railway, owned by the

people of British Columbia, and run by an independent board of

directors, and making a profit. But the railway was told, and people

said.... Even the Canadian National didn't think we could

accommodate those unit trains. But when the bridge was knocked out over

the Second Narrows three years ago, I believe, the British Columbia

Railway indeed did move those heavy hopper cars and unit trains from

Prince George over their system, down to the elevators on the west

side. They did a good job. Some 688,000 tons of grain were delivered

over the British Columbia Railway line in 1978 and 1979.

So we do have the alternative to assist western farmers in getting

their grain to market should there be an outage in one of the other

lines, either through the Fraser Canyon or through the Rogers Pass. I

just wanted to put that into the record.

I said I would outline to the House how changes could be made in the

act to accommodate the British Columbia Railway. At the present time,

the Minister of Transport has indicated that the railways will be

required to meet performance guarantees for grain traffic. Certainly

the British Columbia Railway can stand up to that scrutiny. If they

would change the bill just a little to accommodate the minister in

being able to deal with independent railways, then he would have the

flexibility to assist the British Columbia Railway. However, the

Minister of Transportation and Highways (Mr. Fraser) and myself will be

having further deliberations and negotiations with the Ottawa

government.

I want to say that I think Jean-Luc Pepin has done a really good job

in bringing this bill forward. You can say what you want, but the

Minister of Transportation and Highways and myself have had a number of

negotiations with Mr. Pepin over the last number of years. We

negotiated with him on Roberts Bank, at Duke Point and Prince Rupert.

I've told Mr. Pepin personally — and I'll say it in this Legislature

today — that if he gets this through the legislature he will probably

go down in history as the greatest Minister of Transport Canada's ever

had. This isn't to say that I agree with Liberal policies at all, or

that I'm necessarily a Liberal supporter, but I do want to say that I

have a great deal of respect for Jean-Luc Pepin and what he has done in

transportation for western Canada. I don't think he went as far as he

could and should have gone in giving autonomy to the control of our

western ports, but again, he took a subject which had been mired down,

had stewed in internal and external politics, and finally put it in a

form that he could sell to the House in Ottawa, and he did get it

through. So I just want to say that when all the shots are being fired

about the Crow rate, I'll stand publicly with Jean Luc Pepin any day,

because I think he's done an excellent job.

MR. REID: Too bad he's a Liberal.

[ Page 772 ]

[3:00]

HON. MR. PHILLIPS: Well, at least as a Liberal he's come out

in the face of controversy and is doing what he really feels should be

done for Canada. That's a hell of a lot more than some of the

Conservative members representing British Columbia are doing, including

the one who represents the great Peace River–Prince George riding, who

has waffled and been all over the place. That's about all I'll say on

that. I don't know what he's saying in Ottawa, but I certainly know

what he's saying in the local press. He's waffled all over the place. I

would like him to come out and say he's in favour of changes to the

Crow. I suppose he's playing a great deal of politics.

My personal feeling is that the Liberals can do enough damage to

themselves; they don't need the Crow rate. I think the Crow rate has

such a long-term implication on the economy of western Canada that we

should all stand tall in our seats and put politics aside. If you

fellows over there had a free vote, I'm sure some of you, with your

conscience, would vote for changes to the Crow rate.

Mr. Speaker, I regret that my time is up. Certainly I've enjoyed

being able to talk here in the Legislature about my feelings on the

Crow rate: how it affects the great British Columbia Railway, how it

will affect all the industries in western Canada and give jobs to the

construction industry. After we get through with northeast coal, there

will be a lot of them around. A lot of them will be able to move, doing

the same type of work building tunnels down on the Canadian Pacific and

Canadian National. Those jobs will be available just as soon as we get

this Crow rate and the railways start building. Those jobs are going to

be finished up there very shortly. As I said in the House yesterday,

we're just about to tunnel through on the last tunnel. That very

excellent Canadian workforce that built those tunnels could move

immediately down to start on the CPR tunnels, but they won't do it as

long as the socialist opposition opposes jobs in this province and

tries to get in bed with the NDP and Broadbent. The same deal on

the....

Oh, I'd love to have time to debate that, Mr. Speaker, but I realize my time is up. Thank you very much.

MR. HANSON: In the stampede to embrace the federal Liberals'

changes to the Crow rate, we haven't heard much from that side of the

House about the incredible sellout of the Dominion coal block. That is

something that is going to go down in history as one of the blackest

days in British Columbia's history. I think there are many people in

the gallery today and many members of this House who are not aware of

the implications of the Dominion coal block. What are we talking about

when we say "the Dominion coal block?" We're referring to 50,000 acres

of land in the Kootenay area which contains coal deposits. These

particular coal parcels were a part of the original agreement between

the provincial government, the federal government and the railways. We

in this House are being asked to support a resolution advocating

changes to the Crow rate, which will not return this historic coal

block to the ownership of British Columbia.

What is at stake in this 50,000-acre parcel that represents 10

percent of the coal of western Canada? It belonged to British Columbia.

About 1897 it was transferred to the federal government. To ensure that

the CPR did not get total control of coal deposits, various provisions

were put on to that coal block. The historic reasons for that transfer

will no longer exist once the Crow rate has changed. What is the value

of that particular block of coal to British Columbia? In 1973 dollars

the value was appraised at $450 billion. There are 8.6 billion short

ton of low- and medium-bituminous coal in those two deposits. We are

relinquishing title of $450 billion worth of coal to the federal

government. This government is so inept in its negotiations with the

federal government that they could not retrieve it and gain sovereignty

over it. Since British Columbians are entitled to sovereignty over

natural resources, that $450 billion worth of coal should be returned

to British Columbia.

Fleeting reference was made to it by that minister who stood up

earlier today and said that the Attorney-General had written a memo in

May, saying, "Please return $450 billion of coal," and "Gee whiz, we

really do hope that maybe that management and ownership will at some

point and that some voice will be given to people in British Columbia."

How timid!

It's larger than the downstream benefits we sold on the Columbia

River — $450 billion. In one parcel of 5,000 acres, there are 110

million tonnes right on the surface — large enough for a coal-mining

operation at any time on a strip-mining basis. Yet in their

negotiations this cabinet was unable to make that a part of any

Crowsnest change, which surely should have been done. It is an absolute

tragedy.

I'd like to read into the record a little of the history of that

particular contract between the railroads, the federal government and

the government of the province of British Columbia. I think all

citizens should pay attention to this particular transfer of ownership

of a non-renewable resource. This could benefit our children and our

children's children for generations to come. They are called the

Dominion government coal blocks.

surface rights on two tracts of land in the Crowsnest Pass coalfield in

the Kootenay district in British Columbia.

"These two tracts comprise parcel 73 consisting of

5,000 acres and parcel 82 of 45,000 acres for a total of 50,000 acres

under the terms of the Crows Nest Pass Act which was assented to on

June 29, 1897."

The debate that is occurring in this House today is a historic

debate, because we are talking about a contract that was entered into

by our province, the federal government and the CPR. We know what kind

of benefits the CPR accrued from that contract and how they did not

live up to their contractual obligations to the people of this

province. We know every day with the E&N Railway how the CPR has

attempted to renege on their responsibilities there.

But again, back to the Dominion coal block.

"Historical background. In 1888 British Columbia

chartered the Crows Nest and Kootenay Lake Railway Co. (subsequently

named the British Columbia Southern Railway Co.) to construct a railway

line from the Alberta border across British Columbia to Nelson. To

promote this, British Columbia passed its Railway Subsidy Act in 1890

providing for a land grant of 20,000 acres for each mile of railway

constructed."

Can you imagine? The railway got 20,000 acres for every mile that

they constructed. They got the minerals under the land, they got the

timber and they got all of those future

[ Page 773 ]

opportunities. It makes one wonder why they weren't able to live up

to their contractual obligations to the citizens when that particular

arrangement was such a generous one.

"On June 29, 1897, the Crows Nest Pass Act was

assented to. Under this act the Canadian Pacific Railway Co. was

required to carry certain products (including coal and grain) at the

rates fixed in the agreement...."

The discussion we are having today is about changes to those rates.

"...to grant certain running rights on its rail way lines

subject to control of the Governor-in-Council, and to convey to the federal

government a portion up to the extent of 50,000 acres of any lands granted

as a subsidy for the construction of the railway by the British Columbia government."

Now this is the Dominion coal block we are referring to, and it is

an inextricable part of the arrangement we are discussing today.

"...this portion to consist of lands which in the opinion

of the director of the Geological Survey of Canada were coal-bearing lands.

In return the railway received a federal subsidy of $11,000 per mile"

— that's for every mile constructed in addition to the 20,000 acres that

they received — "but not exceeding $3,630,000 to assist in the construction

of the Crowsnest Pass line from Lethbridge, Alberta to Nelson, British Columbia."

On July 30, 1897, a tripartite agreement was entered into between

the companies, the federal government and the provincial government.

The provincial government's role was to provide that coal land to the

federal government.

"...tripartite agreement was entered into between the

CPR, B.C. Southern Railway (which was fully purchased by the CPR in August 1897)

and the Kootenay Coal Co. (later renamed Crowsnest Pass Coal Co.) under which

British Columbia Southern Railway undertook to build the railway and to convey

from British Columbia under the 1890 Railway Subsidy Act.

"On September 6, 1897, the CPR entered into the

agreement with Canada as required...thereby assuring the subsidy of

$11,000 per mile."

"On August 18, 1899, the

Lieutenant-Governor-in-Council of British Columbia, by order-in-council

no. 539, granted to the British Columbia Southern Railway Co. an

extensive tract of land comprising about 610,000 acres in the Kootenay

district."

That's what they were awarded in terms of land.

"Conveyance of this land was effected by Crown grants

1165-109 and 1166-109 dated August 18, 1899, which reserved all

minerals other than coal to British Columbia.

"These lands were examined by representatives of the

federal government, and 50,000 acres of coalbearing lands were selected

pursuant to the terms of the Crows Nest Pass Act. This selection was

confirmed by order-in-council PC664 dated May 19, 1902, and a perimeter

survey was carried out between 1902 and 1905. Title to the surface and

coal rights was duly conveyed to the Crown in right of Canada from the

British Columbia Southern Railway Co. under a deed dated September 14,

1905, and a certificate of indefeasible title 19-1 dated November 27,

1905, was issued to His Majesty in right of Canada in respect thereof

by the district registrar of the land registry office in Nelson, B.C.

"The Crows Nest Pass Act has primarily to do with

railway transport considerations, particularly as related to movement

of grains. The coal lands are referred to in subclause 1(

i) as

follows, in which the name company means the Canadian Pacific Railway:

"That if the company or any other company with whom it

shall have any arrangement on the subject shall, by constructing the

said railway or any part of it as stipulated for in the said agreement,

become entitled to and shall get any lands as a subsidy from the

government of British Columbia which in the opinion of the director of

the Geological Survey of Canada (expressed in writing) are coal-bearing

lands, then the company will cause to be conveyed to the Crown, in the

interest of Canada, a portion thereof to the extent of 50,000 acres,

the same to be of equal value per acre as coal lands with the residue

of such lands. The said 50,000 acres to be selected by the government

in such fair and equitable manner as may be determined by the

Governor-in-Council, and to be thereafter held or disposed of or

otherwise dealt with by the government as it may think fit on such

conditions, if any, as may be prescribed by the Governor-in-Council,

for the purpose of securing a sufficient and suitable supply of coal to

the public at reasonable prices, not exceeding $2 per ton of 2,000

pounds free on board cars at the mines.

"And on the part of the government to pay the said subsidy by instalments as aforesaid.

"It is the stipulation in this subclause requiring the coal

to be sold at $2 or less per ton, together with the possible implication that

the coal cannot be exported, that prevents exploitation of the coal in these

blocks."

As you know, Mr. Speaker, there have been extensive challenges in the past

with the federal government attempting to hold on to that coal, but it is clearly

in the jurisdiction of the province of British Columbia, which has sovereignty

over the natural resources. The historic rights of that particular arrangement

no longer obtain, and that coal block should be returned to British Columbia.

This government was unable to negotiate that as a part of the Crowsnest change

package. As for the current situation, up until 1973:

"The rising requirements for coal and the consequent

substantial increase in mine development in western Canada have

resulted in recent and stronger interest in these coal blocks by

industry and the federal government.

"There has been some dispute between the government of

Canada and the government of British Columbia as to who controls the

coal rights in these two coal blocks. The federal Department of Justice

has examined the provincial arguments and has advised that the

province does not have any valid claim to the ownership of coal in the

lands in question.

[2:15]

"In the late 1960s and up until 1971, licences to

mining companies. Because of the above-mentioned restrictive subclause

l(i), in the Crowsnest Pass agreement, and the uncertainty about

[ Page 774 ]

when such restriction might be removed, the Department of Energy,

Mines and Resources did not renew these non-exclusive exploration licences in

1971. The government of British Columbia also issued exploration licences in

these coal blocks, which are still in effect."

Now what is the potential of these blocks, Mr. Speaker? The

potential is that total reserves in the Dominion coal blocks have been

estimated at 8.6 billion tons of coal. As we know, in the northeast

presently.... Let's just say that at $80 to $90 a ton, multiplied

by 8.6 billion, we see what the value of that commodity is.

"The 8.6 billion short tons or about 10 percent of the

total resource of medium-and low-volatile bituminous coal in western

Canada. This is a geological estimate, and recently (1972) the

Department of Energy, Mines and Resources enlisted the services of a

consultant to assess how much of the total reserves could be extracted

by surface mining at economically acceptable ratios of rock overburden

to coal. This consultant concluded that about 110 million tons would

be recoverable from block no. 73 " — which is smaller block of 5,000

tons. No such study has yet been made on the second block.

"A quantity of 110 million tons is adequate for

supporting a very substantial mining operation. The coal has been

tested for quality and has been determined to be of good metallurgical

grade."

Mr. Speaker, the reason I read this into the record is that I think

the historical events outlined in that document indicate to us our

responsibility to ensure that that particular resource of British

Columbia is returned to British Columbia. The complete disregard of

that historical agreement seems to have missed the cabinet, and they've

been absolutely ineffectual in obtaining any redress. Typically, the

people of British Columbia are going to be suffering because of their

lack of managerial competence and negotiating ability with their

federal counterparts. We in this province have been giving away our

natural resources for bargain-sale prices since this province was first

established as a colony. Here we are, in 1983, having resolutions

before this House asking this opposition to support an agreement which

forgoes revenues of $450 billion — future revenue possibilities for our

children and our children's children — because of their ineptitude.

Obviously there are many other factors, as pointed out eloquently by my

colleagues, why we cannot support this resolution. It is a giveaway to

the railways. The contracts are open-ended. The CPR and the CNR will

get subsidies when the farmers of Canada should be subsidized rather

than the railways, who have never lived up to their obligations to the

people of this country.

It is our contention, Mr. Speaker, that this particular change to

the Crow rate will not in any substantial way benefit the people of the

province, because, as I have outlined, that $450 billion is exactly 150

times more than the railways could possibly spend in any upgrading,

doubletracking or railway streamlining in this country. That is

absolutely correct, and we have full documentation to support that

argument.

It's not surprising that the minister responsible would stand in his

place and make fleeting reference to that Dominion coal block, and that

the Attorney-General (Hon. Mr. Smith) has sent a memorandum to the

federal minister begging for some kind of resolution that would be in

this province's interest. It is my contention that the return of these

coal parcels should have been part of any agreement to change the coal

lands. To do otherwise is to be derelict in their duties to all ensuing

generations of British Columbians.

[Mr. Pelton in the chair.]

Let me just outline for you what public aid to the CPR just on the

main line alone — has been during the construction period. They

received $25 million in cash, they received 25 million acres of Canada,

and now this provincial government is asking our side of the House to

support them in relinquishing title to a massive natural resource that

could be of benefit to us. We relinquished land for right-of-way and

stations; sections of the main line would be built at a government cost

of $38 million. Parliament clearly intended these resources to enable

the CP to maintain a modern railway system. We know very clearly how

the CP Rail has treated the farmers on the prairies. They have never

lived up to their obligations to service spur lines and secondary and

tertiary rail lines, and they're in the process of cutting back all the

time. Now we are asked to support a resolution which puts millions of

dollars of taxpayers' money into the hands of the railway companies.

How can you ask us to do that? They want to support the federal

Liberals in this resolution, and we on this side of the House certainly

do not.

MR. MICHAEL: Mr. Speaker, it's very interesting insomuch as

this House has been in session since June 23 and this is the first day,

to my recollection, that we've had a true debate in the House. Up until

now we've had nothing but filibustering, procrastination and delaying

tactics. Speakers from the opposition have continually risen and spoken

for 40 minutes at a time. If they spoke about something, it would be

one thing, but they stand on their feet for 40 minutes and say

absolutely nothing — one speaker, indeed, carried on for nearly seven

hours, keeping this House in session — calling for divisions after

every person speaks, delaying the conduct of this House for an

additional ten minutes. When I think of the cost to the taxpayers in

the province of British Columbia to put up with this nonsense, tens of

thousands of dollars a day, it makes me sick indeed. They have got up

on every single issue, every single bill, and indicated continual

obstruction.

MR. LAUK: On a point of order. I hesitate to interrupt the

hon. member in his maiden speech, but the subject before the House is

resolution number 2, which has to do with the Liberal legislation

before the House of Commons. The opening remarks of the hon. member

have now been four or five minutes and he hasn't touched upon the

subject.

DEPUTY SPEAKER: The Chair sustains the comments made by the

second member for Vancouver Centre and would ask the hon. member to

continue speaking but to speak to the Crow rate.

MR. MICHAEL: I am certainly leading into discussions on the

Crow rate. I believe that folly is bad enough, but learned, planned and

intentional folly is intolerable. The opposition is the most sensible

group of people talking nonsense I've ever seen. Their filibustering

could best be described as a deluge of words and a drop of sense. I

guess I

[ Page 775 ]

shouldn't be surprised by the members of the "no development party"

speaking against this motion, although I was hopeful. Doing away with

the Crow rate means investment in our province and jobs in your area,

members of the opposition. You've spoken against everything else; why

not against jobs? You don't want jobs in the private sector. You'd

rather keep all on the public payroll. Where's the money going to come

from if there's no development in the private sector? If industries are

not given the opportunity to develop and expand, where are the revenues

going to come from?

Since this current session began, a bitter and defeated "no definite

policy party" has filibustered everything that has come before this

House. They're against everything: opposing a small tax on cigarettes,

using all sorts of stalling tactics day after day and costing the

taxpayers of this province thousands of dollars a day. Those members

over there are opposed to all progress. They always have been against

all progressive ideas: they were against B.C. Place and Whistler; they

didn't want the northeast coal; they didn't like Hydro expansion

projects being put in place; they were against opening of the northern

areas of our great province; they would rather have brought back

trolley cars instead of the ALRT. Now they're against changing the Crow

rate. They don't want an efficient, expanded rail transportation

system. They don't want business and industry in our province to

develop and grow. They are against British Columbia increasing its

competitive edge in the international markets.

[Mr. Strachan in the chair.]

They are against recovery, a bright economic future for British

Columbia and for Canada, and jobs in the private sector. They would

rather keep everyone unemployed so they can attend protest rallies.

They were against the mining industry in the 1970s and they haven't

changed; they are still against the mining industry. They don't want

the companies to be able to grow and create jobs. "Keep everything the

way it is. Leave it in the ground," they say. It doesn't matter to

them that even some of their own union friends are lobbying in Ottawa

to have the Crow rate done away with. Members of the opposition are

down there because they know that change means jobs for their members.

If ever there was a time when we should be unanimous in our support for

such a motion, the time is now. Instead, we hear them blah-blahing and

boohooing about who's in the political bed with whom.

We're talking about jobs in this province. We're talking about

development, investment and future prosperity. They're against it all.

Their cohorts in Ottawa are against it. "Kill the thing. Don't let Bill

C-155 pass. Don't bring jobs and investment to British Columbia. Kill

free enterprise. Keep the Crow. Strangle the economy. Keep the people

down, unemployed and unhappy." It doesn't serve the NDP's vested

interest to see growth in our province. The people of our province are

only now realizing the importance and significance of the need for a

change in the Crow rate. Only now are British Columbians realizing that

our province has the most to gain if the federal government passes Bill

C-155, and our province has the most to lose if that bill does not get

through the federal parliament. The economic future of British

Columbia's resource industries depends tremendously on the passage and

change in the Crow rate. As one British Columbian businessman put it

recently, the fate of that legislation will determine whether our coal

industry takes off in this decade, whether our forest industry recovers

from the recession or whether those sectors and others will be tied

down by a lack of new railroad capacity.

[3:30]

There are those, perhaps with vested interest, who oppose doing away

with the Crow rate, and say it is risky or even fatal to try to change

something that has been in place for 86 years. That new federal

legislation will do more than just update history; it will help the

economic futures of British Columbia and Canada. The Crowsnest Pass

Agreement Act, passed by the Canadian parliament back in 1897, was a

good idea at the time and for many years after. As the Mining

Association of British Columbia put it in a submission to the federal

government, the need for change is clear and the time for change is now.

Back in 1897 the federal government wanted to fill the vast, empty

prairies with grain farmers who would ship wheat and flour to markets

in central Canada. The first transcontinental railway was completed in

with the CPR to complete a southern route through the Crowsnest Pass.

Part of that deal with the railway, besides some land and some cash

grants, was a fixing of price for grain. Grain farming in those days

was risky. The markets were thousands of miles away, so to help

establish this new industry the federal government decided that grain

would be carried at fixed low freight rates. The farmer didn't have to

concern himself with high shipping costs in times of low prices for his

product. The farming industry on the prairies would grow and prosper.

Years went by and the Crow rate remained for the most part unchanged.

In 1925 the rate was set in statute as a result of lobbying from the

prairies. Two years later it was amended to apply the Crow rate to

grain handling on the west coast, and in the thirties the route to

Churchill, Manitoba, was included in the act.

Things went fairly well. The railways made a profit and the western

rail network was expanded. Then came the 1960s and the system began to

deteriorate. Railway costs began to rise. There was less money to buy

new railcars and less money to keep the small branch lines maintained.

Into the 1970s things got even worse. The railways wanted permission to

abandon branch lines that were the worst money losers. Instead of doing

what was necessary — even then doing away with the Crow rate — the

federal government subsidies were spread around. There were over $2

billion in subsidies, but it didn't help and the conditions got

steadily worse. In 1975 the railways lost $105 million moving prairie

grain. By 1980 the annual loss had climbed to $244 million. By 1982 for

every dollar the railways received for shipping the grain they lost $4.

Subsidies, studies and royal commissions could not change the fact that

the Crow had to go.

We in British Columbia, as I stated earlier, have the most to gain

from changing the Crow rate and the most to lose if it isn't changed.

Our economic future depends on it. For British Columbia to grow the

Crow must go. There is a group in our province called the B.C. Action

Committee to Change the Crow. It is not affiliated with any political

party. Is a non-partisan group of people from business and labour with

representatives from the Employers' Council, the mining association,

the Council of Forest Industries, the construction industry, road

builders, the Teamsters and the Maritime Employers' Association, all

working together lobbying the federal government and opposition in

Ottawa to ensure that this most necessary change does come about.

[ Page 776 ]

There was a lot of determined opposition to the legislation.

Powerful organizations want to kill the bill, and it's time, Mr.

Speaker, that all of us here in the Legislative Assembly, both the

government and the hon. opposition, join together unanimously to pass

this motion, demanding that the federal government pass Bill C-155.

As I said a moment ago, British Columbia's economic future depends

on it. In terms of coal, virtually all of it mined in this province

goes to foreign markets, but there are other coal-producing countries

that are competing with us for the same markets. The biggest selling

point that we can have that can put us ahead of our competition is

reliability of supply. That is our key competitive edge. But that

reliability of supply depends on our having a transportation system

that will move the coal from the mines to the coast right now. The rail

system is running at capacity. Unless we increase the transportation

capacity, our coal industry cannot expand. Without expanded

transportation capacity there will be no investments to develop new

mines and no new customers, because we can't guarantee shipment if the

rail capacity isn't there.

What about our forest industry and manufacturing industry? We are

just coming out of the worst recession in 50 years. Business is ready

to invest in new growth for our province — new production and new jobs

for British Columbia. It's all there. We have everything we need to

begin new growth. British Columbia can lead Canada in economic

recovery. We also have a solid, well-experienced free enterprise

government with good leadership in British Columbia. But standing in

the way is the Crow. Threatening to strangle our economy is that

86-year-old piece of legislation. It should be called an albatross,

because it is hanging around the neck of our fragile recovery.

Resources are everywhere and the economy is root bound. The Crow must

go.

When the federal bill is enacted into law in British Columbia,

British Columbia will see a railway construction boom such as none of

us have ever seen. The two national railways will spend some $16.6

billion on expansion across the country. A third of that money, almost

$5.5 billion, will come to British Columbia. CP Rail is ready to pour

some $700 million into the Rogers Pass tunnel and double-tracking

between Golden and Revelstoke, $10 million into a terminal in Port

Coquitlam, and $40 million into a repair shop and a new rail yard in

Golden. Canadian National will spend $900 million double-tracking their

main line from Valemont to Vancouver, more than half a billion dollars

to upgrade the line from Valemont to Prince Rupert, $150 million for

new rail yards and new repair facilities in Vancouver, $60 million in

Prince George and $34 million in Kamloops. Those are just the main

projects. They don't include all the new terminals and sidings, and all

the general upgrading throughout the rail network in our province.

Let me just say something about northeast coal. It is an investment in the

future of our province. This government's $750 million investment — only

a fraction of the $2.5 billion being spent on the project — will result in a

net return of $350 billion in taxes, surcharges and other levies. These benefits

will go a long way towards paying for our schools, hospitals and social programs.

Northeast coal is providing jobs for British Columbians: 6,800 construction

jobs have been created this year; 2,230 permanent mining, transportation and

port handling jobs will be in place once the mines begin operating. With future

contracts and economic conditions, northeast coal could generate as many as

18,000 to 28,000 indirect jobs. With the Crow rate gone, all the projects

I mentioned a moment ago will come. All these projects represent the largest

megaproject ever launched in British Columbia. At $5.5 billion, they are equivalent

to two northeast coal developments over the next seven to nine years.

Those millions of dollars I listed are only direct spending by the

railways themselves, including government support. But each one of

those billions of dollars will spread through British Columbia's

economy and generate tremendous multiplier effects. Employment

generated will amount to approximately 87,000 man-years. And the

overall labour income will be more than $3 billion over about seven

years. Just imagine what that kind of a payroll will do at the retail

level, in the housing industry. And there's more. Total industrial

sales arising from rail expansion projects will reach $8.5 billion in

British Columbia. The projects will add almost $4.5 billion to our

province's gross national product. The ripple effect will be

far-reaching provincially, nationally and internationally.

This is why British Columbia has the most to gain from the

investments that will follow changes to the Crow rate, why our recovery

depends so much on expanding our rail transportation system. It is

clearly in the interests of all of us, all British Columbians, that the

motion we have before us must pass, preferably unanimously, and why the

federal Bill C-155 must be passed as well. It is in Canada's interest

to end this archaic freight rate. We are not proposing this to serve

our own interests at the expense of the prairie farmers. The federal

Bill C-155 includes a commitment from Ottawa to subsidize grain

transportation to a total of a billion dollars a year in this decade.

Increases in grain-shipping charges will be gradually phased in, and

there will be a safety net to protect grain farmers against high

freight rates in time of low prices. The federal government will also

continue to supply new hopper cars and pay for the upkeep of the

prairie branch lines.

I would like to conclude my remarks by quoting a portion of a

submission in July of this year by the Mining Association of British

Columbia to the transportation committee of the House of Commons

regarding Bill C-155, the Western Grain Transportation Act.

"The mining industry is heavily dependent upon an

efficient, reliable railway system. At present the financial ability of

the railways to expand capacity in western Canada is adversely affected

by the continuing losses that result from carrying grain at the

statutory Crow rate. Therefore we welcome the federal government's

initiative in introducing legislation to reform the Crow.

"Like any compromise, Bill C-155 has its defects, some

of which should perhaps still be corrected. In particular, the mining

industry would prefer to see a major part of the Crow benefit paid to

producers, who could then decide for themselves how this money should

be spent. But however the final compromise is struck, it is very

important that some version of Crow reform be enacted as soon as

possible.

"Canada's rail network is the vital backbone for

agricultural and industrial development in our country. Without the

railways, economic development in the west would have been impossible.

Without expanded rail capacity, economic expansion in the west is

unlikely. Thus the importance of Crow reform goes

[ Page 777 ]

beyond regional considerations and beyond partisan considerations

as well.

"The need for change is clear, and the time for change is now."

Only the future can really tell us what massive benefits will come

from the development of our rail transportation system. Incidentally,

with all this expansion there will be much more ongoing maintenance

work in future years, meaning steady long-term jobs for many British

Columbians. When all the major developments and expansion are

completed, these changes will bring more than just job security for

thousands of British Columbians. They will set in place a new and

tremendous infrastructure for more development in mining, forestry and

secondary industries — jobs, Mr. Speaker.

With the expansion of our rail system and the further development of

industry, our competitive edge in the international marketplace will

improve. Reliability of supply, which is the edge we need, would come

with that expanded transportation system. The customer needs to know

that the product he buys will be waiting at the dock when he wants it.

We need to have the expanded system to ensure that products such as

coal can be moved quickly and efficiently from the mines to tidewater.

I'll give you an example of that need for expansion. In 1981 B.C. Coal

was ending a long-term contract with CPR, which was hauling coal from

Elk Valley to Roberts Bank. In looking five years down the road, the

company discovered that they would be contracting a full one-third of

the westbound capacity of the CPR. With the system as it is now, coal

as a commodity needs about two thirds of the capacity of the rail

system; what little capacity is left goes to the many other products:

petrochemicals, timber, grain and all other needs.

[3:45]

In conclusion, I would like to call upon the opposition to give

consideration to unanimous approval of this motion. I would invite

suggestions on amending the motion, if that's their problem. In his

speech to the House I heard the hon. member for Prince Rupert (Mr. Lea)

talk about the lack of faith and lack of trust in the CPR for not

fulfilling or following through with their commitments. Why doesn't he

suggest to our House Leader that we amend the motion, if necessary, to

get unanimous approval? Perhaps the words, "with the clear

understanding that a contract is in effect with the railways, ensuring

capital expenditures are made in accordance with declared commitments,"

or words along that line could be suggested by the opposition.

SOME HON. MEMBERS: You move it.

MR. MICHAEL: I would move it if I was assured that we would

have the unanimous approval of this House. But I don't believe that

would do the trick, hon. member. It's my belief that the opposition

will always find another excuse for why they can't support this bill.

MR. LAUK: Exercise leadership.

MR. MICHAEL: It's a political exercise on your behalf, hon.

member. The NDP in this province will stand in the way of passing this

legislation because of their federal cohorts and their friends on the

Prairies. They are not sitting in this Legislature representing the

people of British Columbia as they should be.

I'll conclude by saying that a little knowledge is dangerous. As near as I can see, no one in the opposition is out of danger.

MR. LAUK: Well, the hon. member for Shuswap-Revelstoke...I was corrected, earlier when I made a point of order and described

this speech as a maiden speech. I was informed that he did, indeed,

make his maiden speech prior to this occasion.

MR. MOWAT: Another one since then, too.

MR. LAUK: Well, I think that if he's going to read speeches, which is in breach of the standing orders and rules of this House....

DEPUTY SPEAKER: One moment, please. The Minister of Agriculture and Food rises on a point of order.

HON. MR. SCHROEDER: It's strange, Mr. Speaker, that this very

same member stood on his feet not half an hour ago to castigate another

member for wasting the first four minutes of his speech in not speaking

to the bill. I would suggest that he might wish to address the motion

himself.

AN HON. MEMBER: That's not a point of order.

DEPUTY SPEAKER: Yes, debate during the motion should be relevant. I'm sure all hon. members are aware of the principles of relevancy.

The second member for Vancouver Centre continues on the motion.

MR. LAUK: It's quite clear the hon. minister for Agriculture and Food is underemployed.

As I was saying, I don't intend to read my speech, and I suggest the

hon. member in support of the rules does not either. If he's going to

read written speeches, we should grant him the right to file his speech

as a return and Hansard will print it verbatim, and we won't take up too much valuable time in the House.

I don't want to be ungrateful. The hon. member has brought some

interesting information to the chamber, or at least he has been the

conduit through which Cam Laker has brought some interesting

information to the chamber. We're always grateful for good research.

However, it would have been better — it's the member's responsibility,

and not his researcher's — to check out some of the facts in the

remarks that are being made.

A great deal of his speech pled poverty for the Canadian Pacific

Railway. He went on to quote a submission made by the mining

association to the committee in Ottawa, which is where that government

should be if it is sincere in its views. The submission by the mining

association talks about the shipment of coal and mining exports. One of

the largest, most productive mining areas is Fording. While he's

pleading poverty for the Canadian Pacific Railway, he should ask

himself who makes the profit from the coal and who makes the profit

from the rail line. The same company, Mr. Speaker. You can't have it

both ways. You're talking about poor, little coal companies subsidizing

the Crow rate and the railway subsidizing the Crow rate. What you're

really talking about is the most selfish, unbridled, greedy company in

the history of this great country talking out of both sides of its

mouth and

[ Page 778 ]

wanting everything. They have bled this country dry over 100 years.

These people in the Social Credit Party are now arguing on their

behalf as if that great powerful company, the wealthiest, most powerful

corporation in Canada, needed the Social Credit Party to defend them.

They own Fording Coal, they own the transportation system and they own

the overseas brokerages. They own the whole works, and they want more

money from the people.

AN HON. MEMBER: The forest companies too.

MR. LAUK: The forest companies, the land development

companies, all of the great wealth of our nation has poured into the

pockets of the CPR and, for many years, to foreign shareholders. They

had the nerve to stand in their places today and plead poverty for the

poor little CPR. That's audacity if I've ever heard it.

The motion does not refer to the jobs in development that will occur — or rather it does.

Interjections.

MR. LAUK: It refers to the Crow rate. Somehow by supporting

the bill, which obviously that hon. member and, also, quite to my

surprise, the member for North Vancouver-Seymour (Mr. Davis) have not

read.... They couldn't possibly have made the statements they did

in this House on this motion if they had read the bill, because the

bill will not do what they say it's going to do. The bill will not

create the jobs they're talking about. It does not create the economic

development they're arguing it will create. Not only are there no

guarantees but there is a guarantee that the CPR will do everything in

its power — because we've got a track record of 100 years — to avoid

any such responsibility. Any economic development that has occurred in

this province for the benefit of the people of this province, be it the

Prince Rupert port, be it Roberts Bank or be it anything else, has been

done in spite of the CPR, and in many cases in spite of the federal

government.

Interjection.

MR. LAUK: Where were you? These are the very people who have

party cards in the Social Credit Party provincially and party cards in

the Tory Party federally. These are the people who support the federal

Tory Party. Mulroney doesn't support this bill and the Tory caucus

doesn't support this bill. Why do you think that the great federal free

enterprise party is opposed to this bill? Is it prairie politics? Not

on your life. They are not supporting this bill.

Interjections.

MR. LAUK: Oh, I see. We have two hats now. Is that what the

idea is? Provincially you are going to talk out of one side of your

face and federally you are going to support people talking out of the

other side. Is that the kind of apparent hypocrisy that we have got to

deal with? The positions of the Tory Party and the Social Credit Party

are diametrically opposed. Are you going to rip up your Tory cards,

folks? If you are sincere about Motion 2 on the order paper, then for

heaven's sake back it up with something called courage and stand up and

oppose the Tory position.

Interjection.

MR. LAUK: I have more backbone than you will ever see, my friend. You are a gutless wonder in this chamber and you know it.

DEPUTY SPEAKER: I will ask the hon. member to withdraw that phrase immediately. It is unparliamentary.

MR. LAUK: Sorry, Mr. Speaker, I was provoked, and I withdraw that remark.

DEPUTY SPEAKER: I will ask the minister not to interject, so that we can maintain orderly debate.

MR. LAUK: That person should not be allowed to provoke me.

DEPUTY SPEAKER: The point is well taken.

MR. LAUK: Back in the 1800s the Canadian Pacific Railway

received substantial mineral rights, land and cash from the people of

Canada in exchange for certain responsibilities. One of these

obligations was to haul grain at the Crow rate. Another was to use its

mineral resources to keep its transcontinental rail line modern and

efficient as the country grew. Now the CPR says it wants to keep the

minerals and the grants but shift its obligations to consumers and

taxpayers who will have to pay the bills.

The federal government subsidized one-half of the construction costs

and the CPR received a grant of over 3,750,000 acres of land in

British Columbia, plus additional square miles of rich coal-mining

lands. In return, the railroad agreed to reduce the rate for westbound

movements by about 10 percent. This became known as the Crow rate. It

was fixed in statute in perpetuity, as has already been mentioned by

hon. members. It was a deal which gave the railway more than it needed

or even expected. Indeed, statements by railway officers that they

would have built the line without financial assistance led to

considerable embarrassment for the government of the day. It should be

pointed out that this same kind of bush-league mentality of giving away

more than even the CPR wants has been a characteristic of the federal

Liberals, and now it's going to be espoused by this bush-league Social

Credit Party most certainly.

Interjection.

MR. LAUK: I'll tell you one thing: W.A.C. Bennett would never

have gone along with this kind of nonsense. That would be a sellout and

he would never go along with it. This party has changed colours so

often no one would recognize it.

Cominco Ltd. Is now a mining, refining, smelting, chemical,

fertilizer, exploration and holding conglomerate. It has mines and

plants throughout the world. CPR owns it. In 1981, its assets totalled

$2,027,824,000. Fording Coal holds the rights to 60,000 acres of

coking coal in the east Kootenays, with reserves of 93 million tonnes

valued at $768 million.

Interjection.

MR. LAUK: There's no guarantee they're going to spend any money, and you know it. This gentleman from Shuswap

[ Page 779 ]

reminds me of the rube who comes into the big city with his

bankroll, and when the first city slicker comes up to him and says:

"Listen, I'll tell you what. Let me hold your bankroll while you go

into that bar over there, because it's very dangerous," he says: " Oh,

okay." This is the kind of attitude the Social Credit government has,

particularly in dealing with the federal Liberals and the large CPR

conglomerate.

By the time the Canadian Pacific Railway was completed, CPR had

received $106 million in cash and over 50 million acres of land. What's

the Liberal strategy that's being employed and supported by the Social

Credit Party? Underlying the Liberal strategy is the attempt to have

people accept the common-sense proposition, they say, that you can't

move grain in the 1980s at the 1880s rates. This has been repeated by

the honourable gentleman from Shuswap and the honourable gentleman from

Vancouver-Seymour. That seems to make common sense on the face of it.

Unless we adjust to modern economic realities, they say, we will see a

radical deterioration of rail capacity in the near future. They want

growth — you've heard that word: modernization; diversification; a

flexible, comprehensive approach — the Liberals say: development. To

remedy the situation, the government wants to end the statutory status

of grain rates, give the railroads $3.7 billion of public funds over

the next four years and $651 million annually in perpetuity thereafter,

and protect the railroads from the effects of inflation on the cost of

transporting grain.

[4:00]

AN HON. MEMBER: Indexing it? Are they going to index it?

MR. LAUK: It's a form of indexing. A permanent subsidy to the

railway with nothing guaranteed in return, and this government says

that's a good deal. What utter and complete nonsense.

Interjection.

MR. LAUK: There is no guarantee. Have you read the bill?

AN HON. MEMBER: Certainly.

MR. LAUK: You have not read the bill, or you wouldn't make the statements that you have.

Interjection.

MR. LAUK: I certainly have.

Let's end this mythology, this woolly-headed, fuzzy nonsense that's

coming from both the Liberals and the Socreds. We'll call them

Lib-Socs. The Lib-Socs are stretching a point and saying that

transportation should be in the free market system. In Canada we have

the second-largest land mass in the world and only 26 or 27 million

people, mostly along the southern part of the border between the United

States and Canada. At no time in the history of Canada has the

transportation system not been substantially subsidized by the federal

and provincial governments of the day. At no time has the public purse

not been called upon to support transportation. There is no way, in

terms of transportation economics, that we can have transportation in a

country such as ours on the free market system. It is nonsense for them

to say that it can be otherwise. Subsidies, yes, but what we say is:

"What are we getting in return?" Let's leave the hundred years that

have gone past and say: "Okay, there's no one in Canada who doesn't

agree that that deal with the CPR was a fraud on the country and the

people, and it drained the reserves of our wealth and resources over a

hundred years." No one will disagree with that, but that's history.

I agree that today the transportation structure of Canada must be

changed. There is no question that it has to be changed. That is a

simplistic statement, and it is dangerously simplistic if it's not

backed up with, "What do we get back for the subsidy?" And to argue in

simplistic terms.... I'm not so surprised at the member for

Shuswap, but I am at the member for North Vancouver–Seymour (Mr.

Davis). At a time when the country called for a change in all

transportation rate structures across the country, the member for North

Vancouver–Seymour was a member of the federal cabinet. Where was he?

Now he stands up in 1983 and calls upon Canada to make a narrow change

to the Crow rate.

The reason that the CPR, the federal Liberals and the Socreds — the

Lib-Socs — do not want to take a close examination of the

transportation costs and economics of this country is that they know

that when that information is made clear to the people of Canada, there

is no way they would support this kind of narrow legislation. They will

want a total overhauling of the system, because to just tinker with the

Crow rate is to put billions of dollars into the pockets of CPR

shareholders, out of the public purse, with no guarantees of economic

development or jobs in return. There are no guarantees in the

legislation. There are no guarantees called for by any of the speeches

made by the Lib-Socs so far — just a claim that there will be economic

development.

Yes, we must change the Crow rate. But if you change the Crow rate

without taking on at least a substantial part of the responsibility of

overhauling the whole transportation structure in terms of rates and

costs, then you're playing into the hands of the CPR. You ask the CPR

whether they want to do an overhaul of the whole structure, and they'll

turn ashen faced and white-knuckled. They'll have to take their

nitro-glycerin tablets if you suggest anything of the kind to them.

They only want a change in the Crow rate because they're going to get

$3.7 billion in the next four years and $650 million every year

thereafter in perpetuity.

This is the kind of nonsense we've been hearing here from the

Lib-Socs. I wonder if this government will be making a submission to

the federal committee that's now........ At least the federal Lib-Socs

have got a committee looking into this matter. They'll get submissions

all right, from trade unions that want jobs but who want to have a

total look at the rate structure. You've been duped and you've been

sucked in.

I'll tell you what the NDP is going to submit to that committee. Do you want to hear it?

MR. MICHAEL: Yes.

MR. LAUK: All right. We would ask the federal government to

pay the railways for proven operating losses hauling grain. We reckon

that it's about $380 million a year.

Secondly, keep the Crow rate for grain farmers and adjust it

slightly in relation to fairness within the context of the export of

grain alone.

Thirdly, we would agree with public investment to upgrade railways,

but we would suggest an amount of only $550 million a year — that's all

that's needed — and equity in the

[ Page 780 ]

Crown by the right of Canada. We want equity in the rail bed. We want equity in the transportation system.

AN HON. MEMBER: Socialize everything.

MR. LAUK: Socialize it? You say just give money to the

capitalists. Do you think that's good economics? Mr. Speaker, that's

the astounding kind of attitude we've got from the Minister of Forests

(Hon. Mr. Waterland), who's been a disaster as a Minister of Forests:

give away the resources, nothing back to the taxpayer, and now that

we're in the lean years we've got nothing to pay for the schools and

hospitals and social structure that we've built up over the years in

this province. It's because of the profligacy and this insidious

conspiracy of the Lib-Socs and the industrialists in this country that

have left the people high and dry.

AN HON. MEMBER: You're out of step with the world, Gary.

MR. LAUK: Oh, I'm out of step with the world. Robber barons

are running unbridled and unchecked in our land, and he says I'm out of

step. If that's being out of step, I'm glad I'm out of step. If I were

the only person in Canada calling for economic justice from the CPR, so

be it. My great-grandfather was a farmer in Canada. I remember the turn

of this.... I don't remember the turn of this century, but he told

me that at the turn of the century....

Interjections.

MR. LAUK: I've got a wonderful memory. I can never be faulted

for my memory. My grandfather used to be a mixed product farmer. He

would ship dairy products and eggs and some livestock and so on to

Winnipeg on a branch line. The railway in those days used to sell the

product, take off their fare for the transportation, and then send a

cheque to the farmer. He said that for about ten years he kept on

sending the product along the branch line and getting a bill back from

the railway for the transportation. It cost more to ship the product to

Winnipeg for the city slickers to survive from day to day than it cost

to produce and sell it.

Interjections.

MR. LAUK: It's awfully easy to say prairie economics. I'm not

always willing to listen to the prairie farmers who want more and more

and so on. But in all justice, Mr. Speaker, hasn't Canada paid the CPR

enough over the years?

We say public investment of $550 million a year, but with equity

ownership to the Crown, to the people of Canada, in return. In the

1800s the people of British Columbia gave the CPR the large coal

deposit to which I have referred. The Pepin plan will remove the price

ceiling on this coal but will not tell us who will own and benefit from

that half billion dollar reserve. This resource rightfully belongs to

the Crown in right of the province of British Columbia, and if we share

as taxpayers, federal and provincial, in this plan, then surely we

should have a share in the equity of Fording Coal. What could be fairer

than that?

The total cost of our plan is the same as the Pepin plan, about $930

million a year. But more upgrading gets done because that's written

into the agreement, and we only pay for upgrading. We don't just dump

the money and nothing takes place, We prevent public money from leaving

the rail system to go to their real estate ventures and dividends and

other things. There's no protection for the laundering of the subsidy

money leaving the CPR into its other subsidiaries. The taxpayer is

protected against inflation by the public investment and the increase

in value to make railways more efficient and reduce operating costs.

What could be fairer than that? That's all we're calling for. Why move

a motion as simplistic as this?

It reminds me of the last session when they moved a motion about

property rights in the charter. I had to laugh when I saw the 26 bills

come down where you could fire without cause — and I use this only as

an analogy. If property rights were in the charter, nothing that this

Legislature could do could take away the right of a person to be fired

with just cause and otherwise with just compensation. The courts would

be full, and if any attempt to fire without just cause was made the

courts would have to strike it down. As the hon. and learned member for

North Vancouver–Capilano (Mr. Ree) knows, a property right is vested in

a job; the courts have found that for some time now. So a Charter of

Rights would protect the people of this province against the actions

that this government is already trying to take. You see, they move

simplistic motions and they don't know what they mean. One time they

vote a motion for property rights — isn't that right? — and the next

time they're taking away the property rights in their legislation.

The same thing with Motion 2. "Are you against the Crow rate or for

it? You're either for me or against me." There's nothing in life just

black and white. Everything in life is complex because human

interrelations are complex. Those people who do not have the respect or

the commitment to their jobs as legislators to study those complexities

are not fit for public office. The simplistic argument that has

occurred in this chamber should be recognized as simply that —

simplistic, fuzzy-headed and woolly. To support the federal bill

without guarantees is pure and utter folly. It's once more stepping

into the abyss and pouring public money down a black hole — the CPR

treasury. That's why we're opposed to this motion in principle and in

particular.

If the hon. minister will agree to include at least a consideration

of the proposals that I've made this afternoon, this side of the House

would most certainly vote in favour of this motion.

Interjection.

MR. LAUK: The hon. member for Maillardville-Coquitlam (Mr. Parks) says that that's magnanimous.

MR. PARKS: Excuse me, it's Maillardville-Coquitlam.

MR. LAUK: Oh, I'm not that pretentious, Mr. Member. I've

lived in the province longer than you, and I pronounce it the way we've

always pronounced it.

Interjection.

MR. LAUK: He's very sensitive about that.

You say I'm magnanimous about it. I'm not being magnanimous. You've

asked for constructive proposals and I'm making constructive proposals.

The member for Shuswap-Revelstoke (Mr. Michael) attacked the opposition and said: "You're always against this

[ Page 781 ]

and that; you never say anything constructive." What about the six points I've made? Do they sound reasonable to you?

MR. MICHAEL: I said that today was the first day you've said anything constructive. Up to now you've been filibustering.

[4:15]

MR. LAUK: Well, how do you know? You've never been here. This is the first day you've been here, and you haven't been listening.

Will you accept the six points, Mr. Minister? He shakes his head.

Why does he shake his head? Because the Lib-Socs are in bed with the

CPR. That's why he shakes his head. We've uncovered this fraud upon the

public; this simplistic move by the government; this callous and

cynical political move. There's nothing worse than political politics.

That hon. minister's guilty of partisan political politics, and I'm

surprised. They called upon us to make proposals and constructive

suggestions, and we have.

AN HON. MEMBER: Hand it to me and I'll read it again.

MR. LAUK: Do you want to read it again? Are you speaking tomorrow on this?

It just proves that the government is not sincere when it calls upon

the opposition to make constructive suggestions. We have, and the

minister, in all of his regal and royal pompitude, shakes his head.

Interjection.

MR. LAUK: An hon. member is suggesting that minister may be

nodding off to sleep, but I took his shake of his head to mean that he

refuses our proposals.

Hot off the press. Because we've been called upon by the government side to make amendments....

AN HON. MEMBER: Are you going to edit your notes as well as read them?

MR. LAUK: No, I'm just marking down my "x".

It's moved by me that the motion be amended by adding in line 2 thereof,

between the words "rate" and "will" the following: "need

to be examined by the Select Standing Committee on Transportation and Communications

to determine if such changes.... " The amendment would make the motion

read:

"This House is of the opinion that changes in the

historic Crowsnest Pass grain freight rate need to be examined by the

Select Standing Committee on Transportation and Communications to

determine if such changes will substantially benefit the economic

development and employment opportunities of Canada and British

Columbia."

What can be fairer than that? Are you going to move a simple motion

or are you going to accept the amendment and let's have an all-party

committee prove that you're right and that we're wrong? If we can show

that we're correct, you will make that submission to the federal

government. Isn't that fair? I urge all hon. members to seriously

consider this amendment and accept it in good faith so that the

sincerity of your arguments can be shown to the public at large.

DEPUTY SPEAKER: The debate can proceed on the original motion; the Chair has not decided on the motion yet.

MR. LAUK: Our next speaker is on the amendment.

MR. LEA: On a point of order, would you like a short recess until you...?

DEPUTY SPEAKER: No, thank you.

The motion is ruled out of order. Let me cite Beauchesne's

Parliamentary Rules and Forms , which states: "It is not an amendment to

a motion to move that the question go to a committee."

On the original question, debate continues.

Interjection.

DEPUTY SPEAKER: The Chair did not recognize the member who interjected, but if the member wishes to rise on a point of order....

MR. HOWARD: No, it had to do with challenging your ruling.

[Mr. Speaker in the chair.]

Deputy Speaker's ruling sustained on the following division:

YEAS — 27

Chabot

McCarthy

Gardom

Smith

Curtis

Phillips

McGeer

A. Fraser

Davis

Kempf

Mowat

Waterland

Brummet

Rogers

Schroeder

McClelland

Heinrich

Hewitt

Michael

Pelton

Campbell

Strachan

Veitch

Segarty

Ree

Parks

Reid

NAYS — 17

Macdonald

Barrett

Howard

Cocke

Dailly

Lea

Lauk

Nicolson

Gabelmann

Skelly

Brown

Hanson

Wallace

Mitchell

Passarell

Rose

Blencoe

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

MR. SEGARTY: The issue of the Crowsnest Pass railway freight

system is complex. I would beg the indulgence of the House that I might

read portions of my speech. I know the member for Vancouver Centre (Mr.

Lauk) sometimes objects to it, but he likes the idea of doing it

himself.

It's a pleasure for me to rise today in debate on the motion put

forward by the Minister of Transportation and Highways (Hon. A.

Fraser). This motion has two parts, one of which I'd like to quote:

"This House is of the opinion that changes in

[ Page 782 ]

the historic Crowsnest Pass grain freight rates will substantially

benefit the economic and employment opportunities for Canada and

British Columbia."

Since early last year, the government of the province of British

Columbia has led the way in our country with policies for economic

development and economic recovery. These policies were designed to

reduce the ever-increasing tax burden on our citizens and to promote

job creation in the private sector. On May 5 the people of British

Columbia made a wise decision and returned the Social Credit government

to this assembly.

[4:30]

The economic development and employment opportunities which will be

available to the citizens of British Columbia and Canada through

changes in the Crowsnest Pass railway freight system, as detailed in

Bill C-155, are unprecedented. They are greater by far than the total

mass of coal development projects that have taken place in British

Columbia since 1968.

[Mr. Pelton in the chair.]

This investment plan by the railways will dwarf the expenditures in

the northeast coal project infrastructure, and are critical to the

future of southeastern British Columbia and job-creation prospects for

our province in this decade. Once freed from the Crow rate, Canadian

National Railways will spend $16.5 billion on expansion across this

country between now and the early 1990s. A good one-third of that

money, $5.5 billion, will find its way into the province of British

Columbia. Canadian National Railways will put $750 million into the

Rogers Pass tunnel and double-tracking between Golden and Revelstoke.

They will build a $10 million tunnel at Port Coquitlam, a $40 million

repair shop and rail yard at Golden, and develop an engine and train

crew shop in Sparwood. CN will spend $900 million to double-track their

main line from Valemount to Vancouver, and more than half a billion

dollars to upgrade the line from Valemount to Prince Rupert. They will

put $150 million into rail yard and repair facilities in Vancouver,

another $60 million into Prince Rupert, and $34 million into Kamloops.

Those are just a few of the projects already announced, and does not

include terminals, sidings and general upgrading of track all over the

province of British Columbia. All these projects will represent the

largest capital expenditure ever undertaken in the province of British

Columbia: at least $5.5 billion, or the equivalent of two northeast

coal development projects, to take place in British Columbia between

the next seven and nine years. The project will add almost $4.5 billion

to our province's gross domestic product. Total industrial sales

arising from rail expansion projects will reach $8.5 billion in British

Columbia alone. These will provide outstanding benefits to the people

of British Columbia and Canada.

The only thing that stands in the way of economic development and

opportunities for employment in our province at this time, when people

need it most, is the Crowsnest Pass railway freight system. Virtually

all coal mined in southeastern British Columbia is produced for export

to foreign markets. It is good quality coal and the extraction

technology is excellent. But other countries, like Australia, the

United States and South Africa, also have mines and compete with us in

the same international markets. We can't beat our competitors on price

alone, Mr. Speaker; neither do we have significant advantage in

quality. Our major selling point that puts us ahead of our competitors

is reliability of supply and a well-trained British Columbia workforce

— they are our key competitive edge. To have coal waiting on the dock

when our customer needs it depends on having a transportation system

that will move that coal from the minehead to tidewater at a reasonable

cost and in a reliable way. Unless we increase our rail capacity, the

coal industry in southeastern British Columbia will not be able to take

on planned expansion projects to develop new mines. No one will invest.

The capital to develop new mines, long-term contracts to sell coal or

any other commodity for that matter.... No customer will sign those

long-term contracts unless shipments are guaranteed. Shipments cannot

be guaranteed unless rail capacity can carry the product to port. That

goes for any commodity, whether it's copper, lead, zinc, lumber, grain

or any other product in our province or country.

Our province and our country are coming out of the worst recession

in 50 years, and we are on the leading edge of economic recovery in our

province. Business is ready to invest in new growth, new production and

new jobs. World markets for our products are firming up, but they will

only firm up to the extent where our customers are sure that we have

the rail capacity to move these goods to market at a reasonable and

reliable cost. This is the reason for the second

section of the motion

moved by the Minister of Transportation and Highways: "This House,

accordingly, expresses its support for the action by the Parliament of

Canada to deal expeditiously with the issue of the statutory freight

rates for the export of grain by passing the required legislation."

You and I, Mr. Speaker, and all British Columbians will suffer if

Bill C-155 is delayed in Parliament by the member for Kootenay

East–Revelstoke or by any other Member of Parliament. Long-term

contracts will fall from our hands and go to our international

competitors. The Australians, the Americans or the South Africans will

be getting the foreign exchange that our resource wealth would have

earned for us. This investment would revitalize whole towns and

communities; jobs that would have taken our people off the unemployment

rolls and welfare rolls will not be created. All of the opportunities

to put the small business sector of our economy back on the rails will

not be spent.

No other region in British Columbia has more to lose from that

investment and from changes to the Crowsnest Pass railway freight

system than southeastern British Columbia. No other region of British

Columbia has more to gain. If the people of British Columbia are to

make good the promises and if our government is to make good the

promises of longterm prosperity and growth, then quite clearly the Crow

must go. But there are those who oppose this legislation, even to the

point where they would ignore the wishes of their own constituents;

even to the point where they would ignore the genuine concerns of the

communities that they serve. In fact, they would go out of their way to

insult their constituents — the constituents that elect them and pay

their salaries — in favour of villages and towns in Saskatchewan and

Manitoba for the retention of the Crowsnest Flass railway freight

system.

In my riding, the Kootenay riding of British Columbia, the sitting

Member of Parliament, the member for Kootenay East–Revelstoke, an NDP

member, has put his loyalty, the loyalty to the New Democratic Party,

before the interests of his own constituents. I heard that member of

the New Democratic Party say, along with the members in this House, that

[ Page 783 ]

they agree that our system needs upgrading, that they agree that the

cost of grain should be increased. Their big objection to the Crow

legislation was that there was no commitment or guarantee in the

legislation that would force railway companies to reinvest their

profits and upgrade our western railway system. Obviously, Mr. Speaker,

the New Democratic Party has not read Bill C-155. They couldn't

possibly have read it. If they had, they wouldn't have been able to

have made those arguments. A letter by the Member of Parliament for

Kootenay East–Revelstoke to the district municipality of Sparwood, on

November 3, 1982, reveals his distrust of coal companies operating in

southeastern British Columbia and of their motives for wanting the

change. This Member of Parliament was openly hostile to the Canadian

Pacific Railway Co. for wanting changes in this agreement. The same

Member of Parliament went so far as to accuse the Canadian Pacific

Railway of blackmailing Canadians and British Columbians.

To ship coal from southeastern British Columbia — from the Elk

Valley — to Roberts Bank is approximately $18 a tonne. To ship grain

from Regina to Vancouver costs 15 cents a bushel or $5.25 a tonne,

compared to $18 for coal. The freight for transporting coal from

southeastern British Columbia has increased 300 percent since 1970,

while the rate for transporting grain under the archaic Crowsnest Pass

agreement has not changed since 1897. The transportation cost for coal

is 25 percent of the selling price. The cost of transporting grain is 3

percent of the selling price. In short, Mr. Speaker, you can ship one

bushel of wheat from Regina to Vancouver for half the cost of mailing a

postcard.

The Member of Parliament for Kootenay East–Revelstoke, along with

those other members of the New Democratic Party, should review the

provisions in Bill C-155. Mr. Speaker, the government of British

Columbia and I agree that this bill does not and will not solve all of

our transportation problems. But in reading the bill you will find that

there is adequate protection to ensure that railway companies cannot

simply take this additional new-found revenue and reinvest it in

diversified enterprises within their corporate empires.

Here are some examples of what I am talking about, Mr. Speaker.

Section 18(

d) provides that a grain transportation agency

administrator must monitor the performance of rail companies to ensure

that performance objectives in the western transportation act are

observed.

Section 29(

l) obliges each railway company affected by the

legislation to file annual statements dealing with the company's

investment in railway equipment, new plants, and plants in general, for

the movement of grain for the time period covered by the report.

Section 29(2) under the act sets out the functions of the western

grain commission to monitor the programs of railway companies with

respect to those companies' programs for investment.

Section 55(2) is

the enforcement mechanism whereby the Minister of Transport may,

pursuant to

Section 29(2), hold back funds from any railway company

which is not meeting its obligation to ensure that an adequate and

sufficient transportation system is in place to meet future

requirements for the shipment of grain.

Section 56(3) provides that

any adjustments made to CN can be varied by other factors that are

appropriate in determining the amount of CN's adjustment. Lastly, Mr.

Speaker, the agricultural community itself is protected by levying a

percentage of the final price for transporting their products on the

cost of their final selling price.

Clearly, the bill tries to protect the taxpayers of Canada and the taxpayers

of British Columbia. It also attempts, Mr. Speaker, to ensure that all of the

upgrading requirements needed in our western transportation system are to be

met and dealt with in an appropriate way.

If the NDP Member of Parliament for Kootenay East–Revelstoke was on

his toes, Mr. Speaker, he would have ensured that coal producers in

southeastern British Columbia had the same protection as the

agricultural community. In fact, if he had provided some positive

bill the same protection for wood producers in British Columbia as was

put in place for the agricultural community to protect them against

unreasonable freight rate escalations.

Mr. Speaker, under the mechanisms set out in the proposed Western

Grain Transportation Act I am confident in saying that as long as one

bushel of wheat travels CN and CP lines throughout this province,

railway companies are subject to government monitoring and threats of

holdups. After all, about 800 B.C. grain producers ship grain over CN

lines and CP lines.

The Member of Parliament for Kootenay East–Revelstoke should check

his facts with a member of this House, the member for Cowichan-Malahat

(Mrs. Wallace), who was the agricultural critic for the New Democratic

Party.

[4:45]

The first reason I want to elaborate on statements and commitments

made by the Member of Parliament for Kootenay East–Revelstoke is that

there is a general misunderstanding on the part of the member about the

Western Grain Transportation Act. Second, I would have expected the NDP

Member of Parliament for Kootenay East–Revelstoke — along with the

member for West Kootenays, for that fact — to stand up in the House of

Commons and support this bill, because of their constituents in

southeastern British Columbia and the job security of thousands of

miners and woodworkers in British Columbia whose jobs and families rely

on the passage of this bill. They are directly affected and their

future is directly affected. He should stand up and represent the

legitimate concerns of the elected people and, indeed, ordinary

citizens of British Columbia.

I've already discussed the problem with rail capacity. Even if Bill

C-155 becomes law tomorrow, there will be rail capacity shortage in

western Canada within the next two years. This frightening situation is

apparent in my own constituency of Kootenay. In pleading for abolition

of the Crow, the mayor of Sparwood, the council of Sparwood and all of

the councils in my constituency passed resolutions opposing the Crow.

Their concerns have been completely ignored by the NDP member for

Kootenay East–Revelstoke. It's interesting how the members of this

House come in here and like to talk about municipalities opposing this,

that and the other. Yet when one municipality asks them to stand up in

support of something that they want, they turn them down because they

have a philosophical objective.

MR. REID: It's hypocritical, isn't it?

MR. SEGARTY: I would agree with the comment of the second member for Surrey.

The NDP member for Kootenay East–Revelstoke left the people of

southeastern British Columbia with really no alternative but to request

the government of British Columbia to present this resolution to the

House. Indeed, it was an election commitment on my part to the people

of my riding in the East Kootenays that this would be one of my top

priorities on

[ Page 784 ]

returning to government. I'm pleased that the Minister of

Transportation and Highways (Hon. A. Fraser) has presented the

resolution for debate in this House. The councils in southeastern

British Columbia also lobby at great expense directly to the government

of Canada for upgrading of our railway system. A letter to the federal

minister, Jean-Luc Pepin, dated December 22, 1982, from the municipal

council of Sparwood urges the minister to immediately undertake the

painful process of passing this legislation. The heading in the letter

is: "Upgrading Rail Trackage from Southeastern British Columbia." The

letter goes on to say:

"The Sparwood council is duly interested in seeing

rail trackage in the rich coalfields of southeastern British Columbia

upgraded to meet current and future economic needs. We duly note, Mr.

Minister, that the southeast coal-producing area known as the Elk

Valley has historically survived despite economic doldrums that

affected us over the years. The new age for coal emerged in the

sixties, and the Elk Valley bounced back with a new vitality and

individuality that has acknowledged a proud and progressive future. One

new mine has been opened up in the past year, the Line Creek mine, and

another is coming onstream, the Greenhills mine. The expansion plans

are set out for yet another mine, Byron Creek, and the future opens

itself up to possible new mines and increased production. True, we do

acknowledge the recession, but we also acknowledge that this too will

pass."

They, too, have confidence in our economy and our future. The letter goes on to say:

"To be, sure, Mr. Minister, the Elk Valley has travelled

a hard road of tough times in our country, and the residents of our community

and the neighbouring communities, with their determination, have survived and

grown for the betterment of the Elk Valley, the province and the nation. We

are mindful of our history. We are mindful of our future. We feel that a serious

look at upgrading trackage from southeastern British Columbia to port at Roberts

Bank would do much to move our resources for the benefit of all. There is a

firm belief that the status of the current trackage is already fully strained,

and we feel that upgrading would be a step in seeing that the economic lifelines

of our communities are extended."

The letter goes on to say:

"We are proud of our people and their determination to contribute

for the betterment of family and nation. We have the resources and the manpower;

provide us with a fuller means of moving our resources.

Sincerely,

Toto Miller,

Mayor and Council of Sparwood."

That letter deals adequately with the situation that the Elk Valley

finds itself in today because of the bottlenecks in our western

railroad system. Who is this Member of Parliament from Kootenay

East–Revelstoke representing if not his own constituents?

It is interesting to note that on May 19, 1983, the federal Hansard

shows on page 25592 that the Member of Parliament for Kootenay

East–Revelstoke presented a petition on behalf of Arran and Pelly,

communities in Saskatchewan, in favour of retaining the Crow. On page

25595 the Member of Parliament presented a petition on behalf of Swift

Current, Saskatchewan. Now this is the Member of Parliament for

Kootenay East–Revelstoke who presented a petition of Swift Current,

Saskatchewan in favour of retaining the Crow. On page 25612 the Member

of Parliament presented a petition on behalf of residents of

Saskatchewan and Manitoba in favour of retaining the Crow. Can you

imagine the nerve? Surely this Member of Parliament has a

responsibility to assist the communities that he is representing in

presenting their petitions and their concerns instead of municipal

councils and individuals going to see federal parliamentary committees

at great expense to their taxpayers and their communities in order to

have this very very serious problem heard by the federal parliament.

They did this at great expense to their community, and the Member of

Parliament of Kootenay East–Revelstoke should be ashamed for not taking

up the concerns of his own constituents and providing them with the

same opportunities as he has provided for the people of Swift Current

and communities in Saskatchewan and Manitoba.

The Member of Parliament should know that no area in Canada stands

to lose more in the long run from retaining the Crow than the Kootenay

region of British Columbia. We tend to lose most.

Page B10 of the Vancouver Sun early in the new year spelled

out the changes that are needed to be made to the Crow in the best way.

It is not surprising to hear the member for Prince Rupert (Mr. Lea)

talk about different parts of the upgrading and modernization programs

cancelled because of the situation we are in. The

article is in the

Vancouver Sun , and I quote: "Canadian National and Canadian

Pacific Railways are slashing capital operating budgets to compensate

for grain deficits, and if the federal government doesn't ease the

burden, railways say that they will do less maintenance work than usual

in 1983." The

article goes on to say: "This will reduce overall

manpower requirements causing layoffs if there is no grain solution by

mid-year." I would suggest it is past mid-year. "CP won't do any

construction this year of its $600 million project for Rogers Pass in

British Columbia." At the present time that project could be providing

thousands of jobs for British Columbia workers, if it weren't for the

holdup attitude of the New Democratic Party. The

article goes on to say

that the railways are cutting a second tunnel through the mountains to

prevent the Rogers Pass from becoming a future bottleneck on its main

line from Vancouver. At issue is the Crowsnest Pass rail system set out

in 1897, which would set the tariff paid by western farmers for moving

grain at a levy below what it costs the railways to handle the product.

Perhaps the best perspective on the Crow was given by the Vancouver Province

economist, Mark Wilson, in his February 7, 1982, comment on the NDP

position, which was entitled "An Unthinking Stand on the Crow." He

says, in part: "It is an unthinking move which observes party loyalty

to disregard common sense." That's the position that the New Democratic

Party is in today: they disregard common sense for party loyalty. That

article goes on to say:

"At present rail freight on export grain meets only

one-sixth of railway operating costs, calculated using a formula

developed by an independent costing analyst hired by the federal

government.

"Losses in the second half of the decade could reach

$4 billion. The magnitude of these losses is ignored by the New

Democratic Party.

[ Page 785 ]

"The railways already admit to cross-subsidization,

whereby they inflate charges to other shippers" — such as coal, copper,

lead, zinc, lumber, pulp and other commodities leaving this province.

"Worse, they cannot meet capital spending programs in adequate fashion.

"It is not generally recognized that both CP Rail and

the CNR have already trespassed beyond desirable starting dates for

needed plant expansion pro grams. Thus there will be rail capacity

shortages in western Canada in the mid-1980s.

"The western economy would have permanently clipped wings if the New Democratic Party have their way.”

[Mr. Strachan in the chair.]

I would particularly like to draw the attention of the hon. members

of this House to the current situation with the pulp and milling

industry in our province. The third international pulp symposium held

on April 25 of this year in Brussels heard in no uncertain terms of the

challenge to traditionally dominant producers. Those nations such as

Canada, Norway, Sweden, Finland and the United States, known as the

Norscan group, are now facing unprecedented competition from their

rivals.

The non-Norscan producers have gained significant growth over the past

15 years, and in 1982 their combined tonnage of pulp production stood

at 9.5 million tonnes, or a full 35 percent of the world pulp supply.

In 1984 it is anticipated that the non-Norscan producers will gain

another 2 percent of the world share. That 2 percent will represent

570,000 tonnes, equivalent to 12 percent of this country's total pulp

production in 1982. In 1990 and beyond, when world demand for pulp is

expected to expand tremendously, the competition from non-Norscan

producers is expected to intensify and become pretty fierce.

[5:00]

More specific examples may be of interest to members in this House.

Brazil, for example, opened up new pulp mills in 1978-79 with a

combined production of 900,000 tonnes beyond their domestic

requirements. Brazil has export markets in Europe, Japan and in the

United States. In nearby Chile, pulp exports are projected to grow to

750,000 tonnes by 1990 and 1.5 million tonnes by the year 2000. Chile

now has import markets to Germany, France, communist China and Korea.

Argentina is also looking at exporting 40 percent of their capacity of

kraft pulp to the Norscan traditional areas, which they started opening

up in 1982. In western Europe, Portugal is entering a new pulp market

in a major way, with production capacity projected to extend to 735

million tonnes in 1982 and 915 million metric tonnes in 1984. This is

basically the situation which our competitors find themselves in. In

eastern Europe, only 250,000 metric tonnes are now being produced for

export. Even within Norscan itself, competition is becoming fierce with

major expansions already underway in the southeastern United States.

Increasingly, there are cost disadvantages to us in this very

competitive world. In the current situation the cost of producing one

tonne of pulp in southeastern British Columbia is $356. In southeastern

United States the equivalent production cost is estimated at $340 per

tonne, so clearly they have a competitive edge. The Norcan producing

countries have much lower production costs than even the southeastern

United States. Is it any wonder that sawmilling and pulp capacity

expansions have ground to a halt in our country, while tough

competition is rapidly expanding and penetrating our traditional

markets?

The New Democratic Party in opposition were intent on attacking the

government of British Columbia for supporting he development of our

railroads, for projects and programs hat were given to the CPR over a

century ago. The same New Democratic Party should look seriously at

what's happening in our country today. Technological change is

replacing the jobs of our workers in the mines and mills of our

country. A few years ago, in a mine in southeastern British Columbia,

the largest truck on the mine site was 50 tonnes and the largest shovel

was a five-yard shovel; today the largest truck is a 200 tonne truck

and one of the largest shovels is 50 cubic yards. So clearly there are

changes taking placing in that industry which will replace worker

participation.

Our sawmilling industry is no different. Technology is replacing

greenchains and areas like that where people were employed in previous

years. Industry has to do it in order to compete in a very competitive

world. High technology has created opportunities for increased chip

production in sawmills; at the same time, the same technology has

reduced demand for chips at our pulp mills. This has created a huge

inventory of wood chips and fibre in our province. It was with that in

mind that the Minister of Forests (Hon. Mr. Waterland) talked in the

throne speech about expanding opportunities for pulp production —

creating new pulp production in southeastern British Columbia and in

the Kootenay region, or expanding existing facilities. But if the cost

of transporting that final product is going to escalate over the next

ten years the same way as it has over the past ten years, then nobody

will take advantage of that opportunity. The cost of transporting coal

increased 300 percent.

It is important today, more than ever before, that our industrial

leaders are able to go out in the world market and forecast what our

costs are going to be 5, 10, 15, 25 years or the life of the plant down

the road. If they're able to do that, you will see industry take

advantage of that new opportunity to create jobs and investment in the

pulp industry in southeastern British Columbia. Just as an example of

what can be done to create that opportunity, it would provide a $300

million to $500 million investment, create 250 direct jobs at the pulp

mills, and 500 jobs in the trucking and logging industry in our

province. That could take place if that opportunity was available today.

If you can bear with me a second, Mr. Speaker, the value of coal

shipments from southeastern British Columbia rose from $66 million to

$573 million in 1982. In other words, the value of coal shipments

increased 7.68 times since 1972.

In 1968, when Kaiser Resources opened its mine in Sparwood, the capacity of

that mine was four million tonnes; it employed 1,000 people. In 1982 that capacity

increased to 6.5 million tonnes; the mine employed 1,914 people. In 1969 Fording

Coal opened its new mine with a capacity of three million tonnes, with employment

for 1,000 people. Today they have an expanded capacity of five million tonnes

with 1,500 workers. In 1975 Byron Creek built a new mine with a capacity of

5.5 million tonnes. This capacity is expected to double, creating 200 ne