2010 Legislative Session: Second Session, 39th Parliament

HANSARD

The following electronic version is for informational purposes only.

The printed version remains the official version.

official report of

Debates of the Legislative Assembly

(hansard)

Tuesday, March 30, 2010

Afternoon Sitting

Volume 13, Number 2

CONTENTS

Page

Routine Business

Introductions by Members

Ministerial Statements

Remembrance of Canadian participation in World War I

Hon. G. Campbell

C. James

Introduction and First Reading of Bills

Bill 9 — Consumption Tax Rebate and Transition Act

Hon. C. Hansen

Speaker's Statement

Motion to place bill on orders of the day not subject to debate

Statements (Standing Order 25B)

Robert Bateman Centre at Royal Roads University

M. Karagianis

Artisan distilleries in B.C.

D. McRae

Maywood Community School

K. Corrigan

Seniors mobility issues and SAFERhome Standards Society

E. Foster

Haiti earthquake relief work by Nelson residents

M. Mungall

Worker transition assistance program and projects

J. Slater

Oral Questions

Removal of sales tax exemption for energy-efficient appliances

C. James

Hon. C. Hansen

Application of harmonized sales tax to green products

R. Fleming

Hon. C. Hansen

B. Ralston

Education funding and school closings

R. Austin

Hon. M. MacDiarmid

Closing of rural schools in Prince George school district

B. Simpson

Hon. M. MacDiarmid

Surrey school district costs and funding

J. Brar

Hon. M. MacDiarmid

S. Hammell

Emergency orthopedic services

A. Dix

Hon. K. Falcon

Orders of the Day

Committee of the Whole House

Bill 6 — Finance Statutes Amendment Act, 2010 (continued)

B. Ralston

Hon. C. Hansen

D. Donaldson

Report and Third Reading of Bills

Bill 6 — Finance Statutes Amendment Act, 2010

Second Reading of Bills

Bill 8 — Energy, Mines and Petroleum Resources Statutes Amendment Act, 2010

D. Donaldson

Hon. B. Lekstrom

J. Horgan

P. Pimm

D. Donaldson

D. Barnett

M. Sather

R. Cantelon

J. Rustad

M. Farnworth

T. Lake

R. Fleming

Hon. B. Lekstrom

Proceedings in the Douglas Fir Room

Committee of Supply

Estimates: Ministry of Small Business, Technology and Economic Development (continued)

J. Kwan

Hon. I. Black

Estimates: Ministry of Tourism, Culture and the Arts

Hon. K. Krueger

S. Herbert

K. Corrigan

[ Page 3873 ]

TUESDAY, MARCH 30, 2010

The House met at 1:36 p.m.

[Mr. Speaker in the chair.]

Routine Business

Introductions by Members

R. Sultan: Mr. Speaker, visiting us today is a constituent, Jim Cairns, who wants to be described as an expert on sustainable conservation, which I loosely translate into recycling. He's one of these unpaid, very expert people that appear in your constituency office and who in fact can be enormously helpful in trying to understand the entire issue of recycling in our society.

Accompanying Jim today is Steve Norris, who lives in Comox. He's chair of the Plastic Processors Environmental Association of B.C., very much engaged in the same issues. Would the House please make them welcome.

Hon. B. Lekstrom: Joining us in the gallery today — no stranger to this Legislative Assembly and a friend to many of us, if not all of us — is Mr. Bill Belsey and his wife, Lonie. Will the House please make them very welcome.

M. Elmore: I'd like to welcome two friends here today from Vancouver, my friends Aman Gill and Awit Marcelino. They are third-year political science students at Simon Fraser University, great examples of leadership in the student movement and very active with me in my office in the Youth in Action group. I ask everybody to please make them feel very welcome.

R. Sultan: Also in the precincts today we have 67 grade 9 students from West Vancouver Secondary School, on a tour accompanied by Ian Brown, their teacher; Chris Davidson, a student teacher; and parents Trish Hunt and Daniela Tana. Ian teaches a course on social justice 12, and he hopes to learn something by watching our Legislature in action. Would the House please make them welcome.

N. Letnick: In the precincts today I have the pleasure of introducing my daughter Melanie Letnick, especially since today is her 25th birthday. Would the House make her please feel welcome.

J. Horgan: I was hoping to say "joining us in the galleries," but they clearly haven't made it from the restaurant downstairs yet. We have Doug and Jan Foreman, constituents of the member for Esquimalt–Royal Roads but parishioners in the same United Church congregation that my wife and I go to. Escorting them from the restaurant is my able and charming — and, as everyone knows, sainted — wife, Ellie, who clearly is lost. Would the House nonetheless make the three of them welcome.

Hon. I. Black: Hon. Speaker, it seems like it's a little bit of a family day theme here. I am thrilled to have my eight-year-old son, Jordan, with us in the precinct yesterday and today to enjoy his first couple of days of spring break hanging out with dad and understanding a little bit of the business that gets done in this fine House.

Hon. B. Bennett: I understand that just before I came into the House my colleague already introduced the former MLA for North Coast, Bill Belsey, so I won't do that. I'll just say hi to him and his long-suffering wife, Lonie. Bill was a great MLA, and he wasn't a bad roommate either.

Also, I'd like to recognize the B.C. Wildlife Federation, which is in the precincts today, led by their president, Mel Arnold, who is outgoing after two years of great work. The executive director, Patti MacAhonic, is also here and two of the vice-presidents and a couple of other folks from the B.C. Wildlife Federation. I'd like the House to help me make them feel welcome.

[1340]

Ministerial Statements

REMEMBRANCE OF CANADIAN

PARTICIPATION IN WORLD WAR I

Hon. G. Campbell: I rise to make a ministerial statement.

On February 18 we lost the last known Canadian veteran of the First World War, 109-year-old Jack Babcock. His passing marked the end of an era — the end of those from a generation of Canadians who were instrumental in building our national identity, who shaped and defined our country by their sacrifice and their commitment to duty and to honour.

In 1914 Canada entered the world with one division of citizen soldiers under the command of a British general and emerged as one of the premier forces in the world under the command of a native son of Victoria, Gen. Sir Arthur Currie.

Canada entered the war as a country that was thought of as a colony but emerged in 1919 as a signing nation of the peace treaty. Canada had become a nation in her own right during the war, largely because of people like Jack Babcock, who committed themselves to serving their country and to meeting the duties of citizenship.

That nationhood came at great cost to a generation. We owe an enormous debt of gratitude, unfailing gratitude, to almost 620,000 Canadian men and nursing sisters

[ Page 3874 ]

who answered the call to serve overseas. The rallying cry of "Off to England" signalled the beginning of a journey that would end in sacrifice for many who arrived untrained, ill-equipped and unprepared for the horror that awaited them.

Almost 30 percent of them, 173,000, were wounded. Included in that number was my great-grandfather, who often talked of the incredible misery that was faced by every one of those troops. In rat-infested, squalid trenches, rain-soaked, they carried on. They defended and they seized ground at Beaumont-Hamel, at Passchendaele, at the Somme and on Vimy Ridge.

One out of ten Canadians who went overseas to the First World War never came home. They lie in Commonwealth graveyards throughout Belgium and France and are memorialized on monuments in towns they struggled to save.

The Great War was a proving ground of sacrifice for a young nation and her soldiers, and there were no finer soldiers on the ground, on the seas and in the air than Canadians. Four of the top seven British aces were Canadians — Billy Bishop, Bill Barker, Nanaimo's Ray Collishaw and Burnaby's Don MacLaren — and 70 Canadians were awarded the Victoria Cross for bravery. These are Canadian battle honours. They are Canada's sons.

Almost 100 years after that call to arms, we look back with more appreciation than words can express on the people who helped define Canada. We're grateful for that magnificent example and for the magnificent country that we inherited from them. They were confident, loyal, determined young men and women who willingly volunteered to defend against tyranny in the world.

Today a book of reflection has been created to allow British Columbians to show their appreciation. It is here in the Legislature. It is an opportunity for us to pause, each of us as British Columbians to pause, and to reflect on the incredible gifts that we have been given, to reflect on the sacrifices of the veterans of the First World War. That book will be open until April 9, Vimy Ridge Day in British Columbia.

There was a poem that we all memorized in school, In Flanders Fields , and the last stanza of that poem says:

To you from failing hands we throw

the torch. Be yours to hold it high.

If ye break faith with us who die,

we shall not sleep, though poppies grow

in Flanders Fields.

Over a hundred years ago men and women from our country decided to answer the call of freedom and democracy in response to the needs of the people of the human race. They have thrown us the torch. The last Canadian has passed the torch on to each of us.

[1345]

May we honour his example, and may we all reflect on the duty that he showed in creating an incredible country for us all to live in. May we each try in our own way to try and respond to that example and to hold up that honour, to hold the torch that he passes to each of us high.

C. James: I also rise to speak about April 9, which has been declared a national day of remembrance for our veterans. As was said, it's also the anniversary of the Battle of Vimy Ridge, a significant and hard-fought battle for our Canadian troops in the First World War. Most of the people who fought in that war were volunteers.

Our forces accomplished what French and British forces could not. They took Vimy Ridge in a lengthy battle in which the Allied forces were victorious. More than 3,500 Canadians were killed at Vimy Ridge, and on April 9, we all have an opportunity to honour their memory and their sacrifice, and the sacrifices of all the veterans of war.

This national day of remembrance takes on a special significance. As the Premier said, John Babcock, the last-known Canadian veteran of the First World War, passed away recently in February. He was 109 years old.

We know much about his service to Canada, because John Babcock shared his story about donning a uniform at 16. He lied about his age to be able to enter the war. While he didn't ever see combat — the war ended before he was brought to the front lines — he was committed to serving his country.

In later years he shared his stories and his memories with all of us, and as Canadians, we mourn his passing, and we honour his service.

There is a story behind every veteran of war. Many of these stories are never told. Some of them are lost in battle. Others are lost to a proud and profound silence. My grandfather was a veteran of the Second World War, and as children in his family, we never heard those stories.

Veterans of that era, including my grandfather, put those memories away. They came back, and they got to work supporting their families and supporting their communities.

I believe our challenge today is to make sure that we keep their experiences and their memories alive. We need to capture those memories, those reflections, the stories who lived through war in order to ensure that those important lessons are passed on. It's important for all of us to learn from that history and to ensure that all of us never, ever forget.

Introduction and

First Reading of Bills

Bill 9 — Consumption Tax Rebate

and Transition Act

Hon. C. Hansen presented a message from His Honour the Lieutenant-Governor: a bill intituled Consumption Tax Rebate and Transition Act.

[ Page 3875 ]

Hon. C. Hansen: Bill 9 has one primary objective — that is, to provide for the winding down and elimination of the provincial sales tax. It also provides for the elimination of the 8 percent provincial hotel room tax. By passing this bill, it will ensure that British Columbians are not subject to these taxes as the harmonized sales tax takes effect pursuant to the federal legislation, effective July 1.

Eliminating the PST and replacing it with the HST will make B.C. more competitive, it will stimulate the economy, and it will result in more jobs…

Interjections.

Mr. Speaker: Members.

Hon. C. Hansen: …in every region of the province. It will result in the saving of $30 million of administration costs in the provincial government each year, and it removes an additional $150 million per year in compliance costs that burden our companies, including the thousands of small businesses that are the backbone of the B.C. economy.

[1350]

In addition to winding down these taxes, this bill does several other important things. First, it provides for an HST tax credit to 1.1 million low- and modest-income British Columbians. Every three months they will receive a cheque that, in most cases, will more than offset any incremental costs they face from the HST.

Second, it will provide a provincial credit to offset the provincial portion of the HST on residential energy and provide point-of-sale rebates of the 7 percent portion of the HST on motor fuels, books, children's-sized clothing and footwear, children's car seats and booster seats, children's diapers and feminine hygiene products.

Before closing, I must advise the House that some of the provisions of this bill must be enacted prior to May 1. We will therefore be seeking passage not later than the last sitting day in April.

In

summary, this is a bill that modernizes and enhances the competitiveness of the provincial tax system by eliminating the old, antiquated, inefficient and job-killing PST.

I move that the bill be read a first time now.

Motion approved on the following division:

YEAS — 47

Horne

Letnick

McRae

Stewart

I. Black

Coell

McNeil

Chong

Polak

Yamamoto

Krueger

Bennett

Stilwell

Hawes

Hogg

Thornthwaite

Hayer

Lee

Barnett

Bloy

Reid

Lekstrom

Falcon

Heed

de Jong

Campbell

Hansen

Bond

MacDiarmid

Abbott

Penner

Coleman

Thomson

Yap

Cantelon

Les

Sultan

McIntyre

Rustad

Cadieux

van Dongen

Howard

Lake

Foster

Slater

Dalton

Pimm

NAYS — 34

S. Simpson

D. Black

Fleming

Farnworth

James

Kwan

Ralston

B. Simpson

Austin

Karagianis

Brar

Hammell

Lali

Thorne

Horgan

Bains

Dix

Mungall

Chouhan

Macdonald

Corrigan

Herbert

Krog

Simons

Gentner

Elmore

Donaldson

Fraser

B. Routley

Conroy

Huntington

Coons

Sather

Trevena

[1355]

Hon. C. Hansen: I move that the bill be placed on the orders of the day for second reading at the next sitting of the House after today.

Mr. Speaker: Hon. Members, you've all heard the motion. All those in favour say aye. Those opposed say nay. The ayes have it.

An Hon. Member: Division.

Speaker's Statement

MOTION TO PLACE BILL ON ORDERS OF

THE DAY NOT SUBJECT TO DEBATE

Mr. Speaker: Hon. Members, first reading is purely formal, subject to practice recommendation 5 — no debate, no amendment. After the motion of first reading is passed, the second motion is then made by the sponsor of the bill that the bill be placed on the orders of the day for second reading at the next sitting of the House after today. The second motion is purely procedural and not subject to amendment or debate. So the motion is passed.

[ Page 3876 ]

Bill 9, Consumption Tax Rebate and Transition Act, introduced and read a first time on a division and ordered to be placed on orders of the day for second reading at the next sitting of the House after today.

Statements

(Standing Order 25B)

ROBERT BATEMAN CENTRE

AT ROYAL ROADS UNIVERSITY

M. Karagianis: Robert Bateman has dedicated his life to soaking up the natural world, understanding it as well as he can and then expressing it in his paintings. The world-renowned B.C. artist turns 80 this year. He has inspired people the world over, and now the inspiration will have a home right in my constituency.

The Robert Bateman Art and Environmental Education Centre at Royal Roads University will be, as the university puts it, a place where art and science merge, where cultures overlap and where relationships between the university and community leaders are forged.

The centre will become the centrepiece of the university's plans to transform the Royal Roads campus into a living, learning laboratory for sustainability. It will contain the world's most comprehensive collection of Mr. Bateman's astonishing body of work. Lovers and students of art will be able to explore his paintings, sketchbooks, personal journals, photographs, films and private collectibles.

In 2006 Mr. Bateman and his wife, Birgit, gave an $11 million gift to the university that includes artwork, archival material and a cash bequest. Many generous citizens have since come forward with donations, and the fundraising effort is continuing full tilt. I'm hopeful that the provincial government will also contribute to the $18 million cost.

The centre is being built as a living building, entirely self-sufficient in energy and water use and constructed from local materials. It will be a place of learning where educators, guest lecturers and artists will deliver programs with hands-on lessons about the environment.

In our collective journey towards establishing a healthier and more sustainable future, it will help us understand stewardship and how to best protect and nurture our precious planet. The Robert Bateman Centre will be a place to appreciate the work of a master wildlife painter, to find inspiration in his creative genius and to find it in ourselves to turn reverence into action.

ARTISAN DISTILLERIES IN B.C.

D. McRae: After being sworn in as a new MLA last June, I had the honour of visiting a distinct part of the Comox Valley riding, Hornby Island. Hornby Island is a very special place. It is populated by artists and craftspeople, is incredibly self-reliant and eco-sensitive, and is home to some unique businesses.

On that visit I was fortunate to have my first tour of the Island Spirits Distillery, one of only eight artisan distilleries in B.C. This particular business creates artisan gin and vodka. I'm proud to say that they have won international awards and are a great example of value-added agriculture in the province.

But this is not the only artisan distillery in the region. Soon to begin distilling its first spirits is the Shelter Point Distillery. This distillery is the only single malt distillery west of Cape Breton Island in Nova Scotia and one of only two in Canada. This business will not only be an excellent example of artisan distilling industry but will also be a unique tourist draw that promotes B.C. agriculture products.

I'm also proud to say that quality artisan distilleries are not exclusive to the Comox Valley. There are also fine distilleries across this province from south Vancouver Island to the Okanagan.

[1400]

I would be remiss if I left out the Sea to Sky region, in particular the Schramm Vodka company. I know that the MLA for West Vancouver–Sea to Sky is very proud of the agricultural products of her riding, and this vodka distillery from Pemberton was the world's first to be certified 100 percent organic. In March this year Schramm Vodka was awarded Double-Gold and Spirit of the Year at the 2010 World Spirits Awards, held in Austria.

I ask the members of this assembly to congratulate all of B.C.'s artisan distillers, and if they are so inclined, raise a glass to their future success.

MAYWOOD COMMUNITY SCHOOL

Community schools like Maywood are often the heart of the neighbourhood. They serve and improve the quality of life for residents and for students and their families. They maximize the use of our public schools, with programs offered in the evenings, on weekends and during the summer.

[ Page 3877 ]

Many partnerships with government, non-profits and the private sector enrich Maywood. I want to highlight two of them.

CH2M Hill is a civil engineering firm located across the street from Maywood in the towers of Metrotown. Not only has CH2M Hill provided financial support, but many of its staff and leadership have become involved in the school in a very personal way. For example, Sharon Summerfield regularly works with grade 1 readers. Some of the engineers help students with math and science. There are many more examples.

Thank you to CH2M Hill for the commitment it has made to Maywood.

I'd also like to recognize the Burnaby Fire Fighters Charitable Society. The firefighters make regular deliveries of cereal bars, fruit leather and arrowroot cookies to Maywood and several other Burnaby schools so that any students who miss breakfast or are otherwise hungry can get a snack. In addition to the major commitment by the firefighters, sponsor PriceSmart Food provides a generous discount on the snacks for the society's purchases.

Maywood is a wonderful success story, where every child and community member is valued, and its many partnerships are an integral part of that success.

SENIORS MOBILITY ISSUES AND

SAFERHOME STANDARDS SOCIETY

E. Foster: As we strive to enhance the quality of life for the people of British Columbia, we need to recognize a major shift in the demographics of our country. According to StatsCan, by 2032, 48 percent of all Canadians will be over the age of 65, almost half the country's population. Declining mobility is a major concern for an aging population, and in many circumstances loss of self-sufficiency and independence are attributed to aging.

Protecting the rights and ensuring the comfort of our senior citizens and those with disabilities is a moral duty as well as a professional obligation for us all.

Recently I had the opportunity to attend a presentation by SAFERhome Standards Society. SAFERhome is a not-for-profit organization committed to creating a better standard of living for senior citizens and those with mobility challenges through implementing effective and affordable change that meets the needs of both consumers and developers alike.

SAFERhome encourages developers to build truly sustainable community models through policy options that include a human element. By following 19 simple steps, it offers the opportunity to build housing that works for a multitude of potential buyer groups — seniors, young, multigenerational families and anyone with any form of special need.

This program has proven to have an on-site construction cost of less than $1,100 per housing unit for a single family and less than $700 for multifamily, as compared to $100,000 to retrofit an existing house, or $40,000 for a multifamily.

These changes do not require legislative change but education of our developers, as a safe home is generally worth more in the housing market. It is therefore a cost-effective and efficient measure which ensures that we respond to the changing dynamics of our province with prudence and sensibility.

[1405]

HAITI EARTHQUAKE RELIEF WORK

BY NELSON RESIDENTS

M. Mungall: Well, 45 minutes after arriving in a community just west of Port-au-Prince on January 12, 2010, three teachers and 17 students from Mount Sentinel School along with four volunteers from Kootenay Christian fellowship, including my neighbour Jim Reimer, were shaken out of their hostel. They were at the epicentre of the 7.0 earthquake that has rocked Haiti to the ground.

As they ran into the street, they left behind $10,000 of raised funds for community supports. Amidst the chaos, that money was stolen. However, the high school students still had the money in their pockets, and it was with both this money and their spirit that the Nelson region began its direct role in rebuilding a devastated Haiti. The students pooled their pocket money to buy rice so that they could give it to those who had nothing. Days later all 17 students arrived home safely.

Three other Nelson residents were caught in the quake, and they, too, survived to then turn around and help many of the injured people in Port-au-Prince. Since January several locals have journeyed to Jacmel, including two midwives and a local paramedic, Alon Gelcer. They are building and operating a clinic for women and children. And today another two Nelson residents are in Haiti contributing their medical skills to the national university hospital.

This one particularly hits home for me because one of these residents sits across the kitchen table from me. Over the next two weeks my partner, Zak Matieschyn, is joining Dr. Joel Kalia in Haiti's busiest emergency room. Although the earthquake has left the headlines, the need and the devastation remain. You can be sure that where there is a need, there is definitely a Nelsonite.

WORKER TRANSITION ASSISTANCE

PROGRAM AND PROJECTS

J. Slater: I am pleased to say that the community development trust program has been benefiting out-of-work resource workers in many B.C. rural communities. We are helping unemployed forest workers, their families and communities to get through these tough, challenging times in the forest industry.

[ Page 3878 ]

This program creates new job opportunities, assists laid-off workers in upgrading their skills and eases the transition of older workers who are leaving their forest sector jobs. The job opportunities–program portion of the three-tiered trust will fund projects that create community-based jobs for up to six months in and around forest-dependent communities.

These jobs will create short-term employment and income while providing the communities the benefit of improving local recreation and tourism infrastructure. Over 3,000 jobs thus far have been created. In the Boundary area of my riding 23 jobs have been created and $500,000 has been invested in urban tree planting, mountain pine beetle surveying, and range fence clearing and repair.

I would like to highlight four projects that have been funded under the job opportunities program. Dennis Contracting will be receiving over $100,000 to clear range fencelines and repair existing fencing in the Rock Creek and Westbridge area.

Whitewater Forestry Consulting is receiving over $200,000 to complete mountain pine beetle star probe surveys, which will include falling and burning infected trees in the Christian Valley–Kettle River area. Jackass Logging Ltd. will receive approximately $133,000 and employ four workers to complete range fence clearing, repairs and fence removal on range units in the Grand Forks area.

The job opportunities program was first announced in May 2008 as one component of the federally funded $129 million community development trust. In July 2009 the provincial government committed an additional $30 million towards the program, which the federal government is matching on a project by project basis.

Mr. Speaker: Hon. Members, earlier on the division vote on Bill 9 the numbers were correct, but there were some names missed. They will be corrected on the record.

Oral Questions

REMOVAL OF SALES TAX EXEMPTION

FOR ENERGY-EFFICIENT APPLIANCEs

C. James: The HST threatens to cost families and small businesses millions of dollars a year, but under this government, British Columbians don't have to wait until July 1, the tax's proposed implementation date, to start paying more.

[1410]

Effective April 1, the B.C. Liberals have cancelled PST exemptions for Energy Star appliances, making consumers pay more for green choices. My question is to the Minister of Finance. Will he admit that his government's HST betrayal will cost B.C. consumers and our environment?

Hon. C. Hansen: The PST as it applies to Energy Star appliances was scheduled to expire on March 31, and that is the case. It's not a case of eliminating something earlier. It is actually what was originally built into the program.

The Leader of the Opposition is flat wrong, because the HST is the single biggest thing that's actually going to stimulate the economy and create jobs in this province.

Mr. Speaker, if you look at the track record of this opposition over the last nine years, they were wrong in opposing the reduction in personal income tax. They were wrong when they opposed the reduction in the small business tax rate. They were wrong when they opposed the implementation of the carbon tax in British Columbia, and they are wrong when they oppose this transformation — the elimination of the PST and the transitioning to the harmonized sales tax.

Interjections.

Mr. Speaker: Members.

The Leader of the Opposition has a supplemental.

C. James: I'd like to remind the minister about who's wrong. The B.C. Liberals are wrong about the HST. That's who is wrong. How quickly this government changes their view. PST exemptions were at the centre…

Interjections.

Mr. Speaker: Members.

Continue.

C. James: …of this government's so-called climate action plan. The government thought PST exemptions were terrific then. They spent millions of dollars advertising those incentives. "You choose, you save," they told consumers. Well, it's the B.C. Liberals who chose not to renew those PST exemptions and to bring in the HST. That's what's wrong.

So my question, again, is to the Minister of Finance. Why is he punishing consumers for making environmentally friendly choices in British Columbia?

Hon. C. Hansen: That's a bit surprising coming from this Leader of the Opposition, who actually opposes the clean energy agenda that this government has put in place, which is being celebrated around the world.

This is a government that has done more to drive a clean climate action agenda than any other government in the history of the province. We're going to continue to drive that agenda, and the transition to harmonized sales tax is one that's going to ensure that even our clean energy sector in British Columbia is going to be able to benefit and create jobs for British Columbians.

[ Page 3879 ]

Mr. Speaker: The Leader of the Opposition has a further supplemental.

C. James: I'll tell the minister and this government what's clear. What's clear is that they threw their climate change agenda out the window and brought in their HST agenda, and that's what matters to this government.

Even appliance companies are sending out last-minute flyers to consumers. "Last chance," the flyers say. "One shopping day left before the B.C. Liberals make you pay 7 percent more."

Again, my question is to the Finance Minister. Why won't he just admit that his HST betrayal is hurting consumers and hurting the environment?

Interjections.

Mr. Speaker: Just take your seat, Minister.

Members.

[1415]

Hon. C. Hansen: I think the Leader of the Opposition has an obligation to ensure that only factual information is circulated. I will give her an example of something I think she should follow up on with her caucus member from Delta North.

When he talks in here about "the additional 7 percent is on top of the present PST," it is that kind of factual misinformation being circulated by members of the official opposition that is just blatant fearmongering.

APPLICATION OF HARMONIZED SALES TAX

TO GREEN PRODUCTS

R. Fleming: Here's the fact of the matter. This is why the Minister of Finance is doing what he's doing. It's because his deficit deceit trumps the environment, and that's the reason why the HST is being introduced.

Beginning on Thursday the B.C. Liberals' HST is going to mean that green products like Energy Star appliances will cost more for British Columbians. Other tax exemptions for energy-efficient heating, green building products, insulation will be gone by the end of the year.

My question is for the Minister of Finance. Why is he using his HST agenda to punish British Columbians who want to make choices that help the environment?

Hon. C. Hansen: I think that's another example of the kind of misinformation that's being spread by members of the official opposition. I will point out to the member that heating oil for residential purposes is exempt. So I think they should get their facts straight.

But Mr. Speaker….

Interjections.

Mr. Speaker: Members.

Continue, Minister.

Hon. C. Hansen: There are literally tens of millions of dollars of additional funding in this year's budget to support clean energy technologies, to support a clean climate action agenda in British Columbia. I think that perhaps this member and his colleagues for once can actually stop being hypocrites, stop pretending that they're supporting one thing and then voting against it. This is actually an opportunity for them to stand up and vote and support the budget measures that actually provide for that clean action agenda.

Mr. Speaker: Member has a supplemental.

R. Fleming: What British Columbians clearly understand is the hypocrisy and misinformation that come from that minister and this government, who promised something before the election, and that was that they would never introduce the HST. Here we are on the eve of the HST being introduced by this minister and this government. That's hypocrisy, Mr. Speaker.

Let's be clear. The B.C. Liberals' HST means that green products will be taxed more from here on in, and it means that oil and gas get a break. The minister referenced that a minute ago. It gets worse. Under the B.C. Liberals' HST, luxury cars get a tax reduction while hybrids, electric vehicles and even bicycles get a tax increase.

So the question for the minister again is: why is he using his HST agenda to exempt high-end gas guzzlers while taxing green vehicles and consumer products, and how does that help B.C.'s environment?

Hon. C. Hansen: It's true. Actually, this government did introduce measures to temporarily exempt PST from certain products, including Energy Star appliances. The question is: why did the opposition vote against that measure?

[1420]

Interjections.

Mr. Speaker: Members.

B. Ralston: Back in 2008, when the so-called green budget was before the Legislature, the minister certainly at that time never said anything about green exemptions being temporary. This was a step on the way to the green New Jerusalem that we heard about back in 2008.

The HST will eliminate…

Interjections.

Mr. Speaker: Members.

[ Page 3880 ]

B. Ralston: …the power of the province to create those kinds of sales tax incentives in the future. In fact, in the election, in writing, the B.C. Liberals said that was one of the reasons — this lack of flexibility for the province — why they, back then before the election, said they opposed the HST.

To the Minister of Finance: why is he making it more difficult for British Columbians to make green choices?

Hon. C. Hansen: Quite frankly, I'll put the environmental track record of this government up against the NDP's track record anytime. But Mr. Speaker….

Interjections.

Mr. Speaker: Continue, Minister.

Hon. C. Hansen: When we have an analysis that's done by one of North America's leading tax economists, Jack Mintz, who actually says that the shift to the HST alone is going to generate more than 113,000 jobs in British Columbia over the next decade….

When we look at the benefits that the HST will have in ensuring that our clean technology and clean energy industries in British Columbia are going to be more competitive and able to drive those costs down so they'll be more affordable to consumers and, also, more competitive on the international markets, there is no question in the minds of any of the leading analysts that have looked at the HST. It is the right thing to do for jobs and for the economy in British Columbia.

Mr. Speaker: The member has a supplemental.

B. Ralston: Mr. Mintz, back in 2008, did another paper. He wasn't paid by the B.C. Liberals to do that one. What he said there, in a simulation for the first four to five years of implementing an HST, was that it would lose jobs, that it would cost the economy of Ontario jobs. So I guess it depends on who's paying the bill what opinion comes out of Mr. Mintz's mouth.

But why does this minister insist on forcing consumers to pay more for green products?

Hon. C. Hansen: It's a shame that this member would actually choose to denigrate the reputation of one of Canada's leading economists, who has an international reputation for excellence in tax accounting.

But let's talk about some of the organizations that are 100 percent in support of this shift to the HST. We've got the Institute of Chartered Accountants of British Columbia. We've got the Canada West Foundation. We've got the certified general accountants of British Columbia.

We've got the Law Society, which I think the member may even be a member of. We've got the B.C. Chamber of Commerce, which has been endorsing and supporting HST now going back to the mid-1990s. We've got the B.C. Agriculture Council. We've got the B.C. Construction Association. We've got the B.C. Pulp and Paper Steering Committee. The list goes on and on.

Why do these organizations support it? Because it's going to be good for the B.C. economy. It's good for the ability to create jobs in every single corner of this province, and it's going to be the single biggest thing that we can do to stimulate the economy and create jobs.

[1425]

EDUCATION FUNDING

AND SCHOOL CLOSINGS

R. Austin: This government's decision to underfund the school system has left districts with little choice except to close community schools. More than 49 schools face closure. My question is to the Minister of Education: how many schools have to close before this government fulfils its promise to parents and protects education?

Hon. M. MacDiarmid: As the member opposite is well aware, British Columbia has had a substantial decline in enrolment over the last ten years. We have lost — well, not lost…. We have 56,000 fewer students attending school. We are concerned not about the students who are no longer attending schools; we are concerned about the students who are currently in schools.

We have a proven track record. We have increased education funding every single year, and not only that, the member opposite is well aware that we are investing in new schools and replacement schools — $1.7 billion since 2001.

Mr. Speaker: The member has a supplemental.

R. Austin: Less than two weeks ago the Premier told media in Prince George that we should "never underestimate the value of a school in a small community." Yet this government hasn't lifted a finger to protect schools in small communities like Big Lake, Lac la Hache, Buffalo Creek, Topley, Hixon, Malakwa, Mackenzie and Hazelton. Again, to the Minister of Education: if this government values small community schools, why are they bolting their doors shut?

Hon. M. MacDiarmid: Certainly, the member opposite has referred to Prince George. This is a school district that has been one of the most affected by loss of students. This school district has declined from over 18,000 students to 14,000.

But this school district…. There's a recognition of the challenges they face. They will be receiving $6.4 million in this district to address the unique features that they have. This is no different from the other rural districts.

[ Page 3881 ]

This district is receiving funding for small community supplement — for climate, for sparseness, for rural and low enrolment factors and also over $4 million to address their needs in transportation.

CLOSING OF RURAL SCHOOLS

IN PRINCE GEORGE SCHOOL DISTRICT

B. Simpson: The Prince George school district has already closed 15 schools since 2002. Tonight the future of another 15 schools hangs in the balance.

Austin Road Elementary, Nukko Lake Elementary, Springwood Elementary, Salmon Valley Elementary, Shady Valley Elementary, Central Fort George Traditional School, Giscome Elementary, Hixon Elementary, Peden Hill Elementary, Dunster Elementary, Mackenzie Elementary, John McInnis Secondary, Lakewood Junior Secondary, Heather Park Middle School, Central Fort George Middle School — all slated for potential closure tonight. Many of those are in small rural communities, which the Premier says deserve a school.

This government will have effectively engineered the end of rural education in the Prince George school district.

My question to this minister is: if this minister knows that the small school funding is insufficient to keep these schools open, will she commit today to make the decision tonight easier for the school board by committing to increase that funding to keep these schools open?

Hon. M. MacDiarmid: I think perhaps the member opposite wasn't listening when I spoke before, so I'll just go over these things again. We recognize absolutely how difficult it is when school districts are faced with these kind of decisions — that the school is the heart of many communities. But the school district in Prince George is dealing with a difficult situation where they previously had 18,000 students, and they now have less than 14,000.

[1430]

There is definite attention paid to the unique factors that they have in Prince George. They are receiving $6.4 million this year as part of their funding over and above their per-pupil funding, which has gone up by 32 percent since 2001.

Mr. Speaker: The member has a supplemental.

B. Simpson: Will the Minister of Education please tell this House what the educational value is of a child sitting on a bus for three hours?

Hon. M. MacDiarmid: As I've said, we are certainly working with this school district and all of the school districts to help them address what they have to deal with in the districts. We absolutely are providing funding in this district and in other districts for the unique geographical factors that they have.

Interjections.

Mr. Speaker: Members.

Minister, take your seat.

Interjections.

Mr. Speaker: Members.

Continue, Minister.

Hon. M. MacDiarmid: We in British Columbia face exactly what many jurisdictions across North America face, and it is the reality of the demographics. We have fewer students in schools. By the end of next school year we believe we'll have 60,000 fewer students in our schools than we did.

What we need to do is do our best in each and every school district for the students who are still in our system. That is why we are once again providing record funding for education, why are we going ahead with programs like full-day kindergarten. It is because of our commitment to education in the province.

SURREY SCHOOL DISTRICT

COSTS AND FUNDING

J. Brar: The Surrey school district has grown by 2,700 students since 2005, yet Surrey schools haven't seen a penny more for schools since then. This year the Surrey district is being forced to cut $2 million from classrooms just to pay for more portables. Because portables are not energy-efficient, the district will have to cut even more from classrooms to pay for carbon offsets mandated by this government.

My question is to the Minister of Education. Why should children in Surrey suffer because of this government's shortsighted decision to freeze construction of new schools?

Hon. M. MacDiarmid: I think the member opposite is well aware, as we all are, that the district of Surrey is the most rapidly growing of all our school districts. In fact, we have 52 of the 60 where enrolment is declining. Operating funding in the Surrey school district is up 56 percent since 2001. Of the 60 school districts in this province, there is no school district where we have invested more in capital than in Surrey — $202 million.

The member opposite is well aware of this, because he was there for the ribbon cutting when we opened Cambridge Elementary in Surrey and when we opened Panorama Ridge Secondary School.

Interjections.

[ Page 3882 ]

Mr. Speaker: Members. Members.

S. Hammell: Not one new school has been funded in Surrey since 2005-2006 — not one new school. I'm not quoting myself. I'm quoting the chair of the Surrey school district — not one new school since 2005-2006.

[1435]

Next year Surrey will have 7,300 students in portables, enough to fill 12 large elementary schools — 12 schools. If the government doesn't start funding schools and building them now in Surrey, that will rise to 8,500 by 2015.

Again to the Minister of Education: how many schools have to be in portables before this government takes action and gets our children into classrooms?

Hon. M. MacDiarmid: Well, here are the facts about Surrey. We are working very hard with the Surrey school district to accelerate school construction to address the steadily increasing number of students. Here's what we've done since 2005. We completed three new schools: Cambridge Elementary, an investment of $8.4 million; Panorama Ridge Secondary, a 1,100-student school, $27 million.

EMERGENCY ORTHOPEDIC SERVICES

A. Dix: On Friday the Interior Health Authority, as a direct result of decisions taken by the Ministry of Health, will downgrade orthopedic emergency services in Kelowna, Kamloops and across the region as a result of changes that the authority is making to the MOCAP program, the doctor-on-call program.

Can the minister explain what evidence there is, if any, to justify the decision to downgrade emergency services under this program?

Hon. K. Falcon: For the benefit of members, the medical on-call availability program was introduced by this government in, I believe, 2003. We spend $126 million a year, and what that does is provide doctors payment for being available and on call. Once they are called in, they also receive additional payment, of course, for the work they do.

Under the physician master agreement we negotiated with the B.C. Medical Association, what happens is there are MOCAP committees in every region, as the member would well know, where doctors sit on those committees with administrators. They determine what level of MOCAP funding each of the different doctor groups receives.

It is entirely appropriate that those decisions are made, according to the physician master agreement, by those committees. I agree that every time a decision is made, there are some that like it and some that don't like it. But I can tell you this much. The decision will not be made here in Victoria.

Mr. Speaker: The member has a supplemental.

A. Dix: On a provincewide program, the minister is justifying a lower level of service in Kelowna and Kamloops and Surrey than exists in Vancouver and Prince George and Victoria. It makes no sense.

If he doesn't want to hear it from me, if he doesn't want to hear the logic from me, why doesn't he listen to Peter O'Brien, the head of orthopedic trauma at the University of British Columbia, who says: "A plan that designates orthopedic surgeon response time at two hours is inappropriate"? Why is it inappropriate? Because we're talking about compound fractures — two hours. We're talking about…

Interjections.

Mr. Speaker: Members.

A. Dix: …pelvic fractures — two hours. We're talking about necrotizing fasciitis and femur fractures. That's what we're talking about.

How can the minister justify a lower level of service in Kelowna, in Kamloops? How can he justify a lower level of service there than he does in other communities in British Columbia?

Hon. K. Falcon: I would encourage the member to come and receive a briefing on the MOCAP operation. I think it might actually be helpful to the member to inform himself.

These decisions are best made by the health authorities in the committees that are available, and doctors sit on those committees.

[1440]

Interjections.

Mr. Speaker: Members.

Hon. K. Falcon: Well, I appreciate the interjection from the member from Powell River. Maybe the member can explain what MOCAP is. I rather doubt the member is, probably, even remotely familiar with it. But the essence of the situation is this. Under level 1….

Interjection.

Mr. Speaker: Member.

Continue, Minister.

Hon. K. Falcon: I haven't heard that this is an issue in Powell River–Sunshine Coast, but I'd be interested in

[ Page 3883 ]

hearing from the member if the member believes it is. These are decisions that are appropriately made by the MOCAP committees, made up of physicians and administrators. They make their decisions based on the needs of the region.

The member should know that in the area to which he refers, they made the decision that interventional cardiology is actually very important to have quick service, and they made that decision appropriately, by the committee.

[End of question period.]

Orders of the Day

Hon. M. de Jong: I call Committee A, Committee of Supply — for the information of members, the continuing estimates of the Ministry of Small Business — and in this chamber, continued committee stage debate on Bill 6.

Committee of the Whole House

BIll 6 — FINANCE STATUTES

AMENDMENT ACT, 2010

(continued)

The House in Committee of the Whole (Section

B) on Bill 6; L. Reid in the chair.

The committee met at 2:43 p.m.

section 30 (continued) .

B. Ralston: Can the minister explain the purpose of this particular…?

The Chair: Excuse me, Member.

Can I invite members having private conversations to take them outside the chamber?

My apologies. Please proceed.

B. Ralston: Can the minister explain the purpose of this amendment of

section 243?

Hon. C. Hansen: To put it simply, it extends the immunity protection to cover persons appointed under

section 277.2 to assist the administrator of a credit union in difficulty.

Section 30 approved.

section 31.

B. Ralston: This proposed amendment repeats some of the language that we discussed in an earlier amendment. I'm taking it that this is a consequential amendment arising out of the choice of this language in the previous section.

[1445]

Hon. C. Hansen: This

section parallels the provisions we discussed earlier around the removal of a director and officer. This gives the commission the powers to actually order a person to cease doing

an act and to take out specific actions as a direct result to provide remedy in a situation.

B. Ralston: Can the minister explain what the consequence might be should a person disregard an order from the commission?

Hon. C. Hansen: It could be determined that it is an offence under the statute, which could lead to prosecution, or there could be administrative penalties that could be brought down as well.

B. Ralston: In some statutes — I think it's in the labour relations act — I recall that a refusal to follow a direct order from the administrative body in question can lead to the order being filed with the Supreme Court and thereafter enforceable as a Supreme Court order, with all the power that that implies.

Is there a provision in this set of amendments or in the act itself that permits that?

Hon. C. Hansen: The answer is yes. It's in the statute. It's

section

Section 31 approved.

section 32.

B. Ralston: Can the minister just confirm that it uses the same language as just used in the previous section (5)(

a) and (b)? Can the minister confirm the purpose for which this amendment is proposed?

Hon. C. Hansen: Yes, that's correct.

Sections 32 and 33 approved.

section 34.

B. Ralston: This proposed amendment is a substantial rewriting — at least a complete repeal of the existing 253.1 — of the area entitled "Administrative penalties." Could the minister set out, perhaps in an overview, what the significant changes are that are proposed in the area of administrative penalties? These are obviously powers given to the commission to administer the act.

[ Page 3884 ]

Hon. C. Hansen: This particular

section replaces the current provision with an efficient and effective administrative penalty framework and creates a streamlined process for minor administrative penalties. So

section 253.1(5) provides that where the amount of the administrative penalty is less than $5,000 in the case of a corporation or $2,000 in the case of an individual, a person who wishes to dispute the penalty will continue to be provided with an opportunity to be heard, but submissions must be in writing only.

It also extends the limitation period for imposing an administrative penalty from six months after the date on which the contravention is alleged to have occurred to two years after the date. It makes further technical amendments to approve and clarify the process for issuing administrative penalties.

B. Ralston: In section (10) there is a maximum set on the amount of an administrative penalty — $50,000 in the case of a corporation or $25,000 in the case of an individual.

[1450]

Earlier the minister spoke, in reference to other sections, about a principle-based administration. Why are these amendments not simply proposing to let the commission, in its discretion, decide the appropriate amount of an administrative penalty with no upper limit rather than limit the maximum that might be imposed as an administrative penalty?

Hon. C. Hansen: It is necessary for there to be a limit established in terms of what those penalties should be because this is a penalty that is assessed by the regulator, not by a court. Therefore, it is not appropriate for unlimited powers to be granted in that case.

B. Ralston: A question with two aspects. Can the minister give a sense of the rough range of penalties that have been assessed up till now and then perhaps an explanation of why this particular choice? It would seem on the surface to be arbitrary. Why not $100,000? Why not $200,000? Why not $10,000? There doesn't seem to be any particular magic to this choice of numbers. Perhaps the minister could explain that.

Hon. C. Hansen: What this does is continue the levels that were established in the previous legislation. There have not been penalties assessed under these sections in the past. One of the reasons for that is the six-month time limitation.

It's felt that with the longer time there is for imposing administrative penalties after a contravention, that will allow for that work to be done. We anticipate that this

section would get used more in the future, and once we have an experience with that, we'll be able to better determine whether or not these particular levels are appropriate. We believe they are. But once we have more experience with the section, we may come back and revisit.

B. Ralston: In subsection (11) it says that an order must specify, among other things, a person's rights to appeal. To what body is an appeal made? Is it made to the commission on the basis of a rehearing, is it directly to the superintendent, or is it to some other body?

Hon. C. Hansen: If it's a decision of the commission, then the appeal would be to the courts. If it is actually a decision of the superintendent that is being appealed, then the appeal would be to the Financial Services Tribunal.

Sections 34 to 36 inclusive approved.

section 37.

B. Ralston: This is a proposed amendment to

section 289 to add some further paragraphs. Can the minister explain the purpose of adding those, other than consistency with the

section 253.1 that we've just debated?

[1455]

Hon. C. Hansen: These changes are just to establish the regulation-making powers pursuant to the other sections that we've already dealt with.

Sections 37 and 38 approved.

section 39.

B. Ralston: Perhaps we could deal with these as a group,

section 39 through

section 42. They deal with amendments to the Home Owner Grant Act. I believe that in his initial explanation the minister made some comments that this was, really, regularizing the manner in which the forms for this were prescribed. Perhaps he could just confirm that.

I believe my colleague from Stikine has a question on

section 41 as well.

D. Donaldson: This

section 41 deals with the homeowner grant and is an amendment to

section 18 of the Home Owner….

The Chair: Member, we're dealing with

section 39. Is that your desire, to comment on 39?

D. Donaldson: Thank you, Chair. I don't have any questions on

section

Section 39 approved.

section 40.

[ Page 3885 ]

B. Ralston: I apologize. I may have inadvertently confused my colleague. What I was proposing was that we deal with the three together or the four together. I don't know whether that's possible — to take the questions on all four and have the vote on all four at once. If that's not the case….

I would like the minister, then, briefly to explain the purposes of

section 39 through

section 42. After that's done, perhaps we can deal with

section 39 and

section 40.

Hon. C. Hansen: These sections, the amendments to the homeowner grant, simply provide for the ability for the minister to approve changes to forms. As is currently the case, every single change has to go to cabinet for approval by Lieutenant-Governor-in-Council. There are sometimes numerous changes, especially as we get into on-line application processes. This actually will streamline that.

D. Donaldson: Just to clarify

section 41, which is an amendment to the wording to

section 18 of the Home Owner Grant Act, regarding who can make regulations respecting who may certify that a person is a person with disabilities. Could the minister advise?

Section 18(2)(

a) states that there can be prescribed "persons in addition to medical practitioners who may certify…."

Is this a change, then — adding people other than medical practitioners who can certify that a person is a person with disabilities?

The Chair: If it's the will of the House, when we call the vote, we'll call the vote on 40 through 42.

Hon. C. Hansen: This extension of the powers, really, is just to enable additional medical professionals to be designated, to allow them to make these approvals. For example, it may be appropriate for nurse practitioners in some cases to approve this designation. This simply allows for the power for that scope of who can do that to be expanded.

[1500]

D. Donaldson: Thank you for that. I'll describe a situation, and maybe that will clarify it for me further. If a person with a disability is not certified by a person other than a medical practitioner under this amendment, then what is the appeal process for that person, if they dispute who's been prescribed to certify them if it's not a medical practitioner?

Hon. C. Hansen: It would be to the administrator of the homeowner grant who could review that decision.

Sections 40 to 42 inclusive approved.

section 43.

B. Ralston: This

section commences a new series of amendments to the Personal Property Security Act.

Section 43 is an amendment to

section 7, which is the law applicable to mobile goods and intangibles and the poetically named "etc." Can the minister explain…? There's a reference to a registered organization. This appears to make it easier to define the law that applies in the case where the personal property, I think, either originates from or the debtor originates from the United States.

Hon. C. Hansen: These amendments will harmonize the debtor location rule with the rule in the U.S. commercial code. It will provide more certainty, and it will reduce costs for the secured parties. To keep Canadian provinces harmonized, the change will become law when the other provinces make the same change. This is really to provide for common

definitions throughout North America.

B. Ralston: Is this code sometimes called the Uniform Commercial Code? I think that's the term that I've heard it referred to by. That's the first part. Then the second

part is: are there any other Canadian provinces that have instituted this definition?

Hon. C. Hansen: First of all, the Uniform Commercial Code is what we're talking about. It's the same thing. Secondly, there is one province that has currently already passed these amendments, and that's Ontario. In Saskatchewan it's before their Legislature.

B. Ralston: We used to hear more about TILMA. We haven't heard so much lately. Is this not something that would fall within the ambit of the relationship between Alberta and British Columbia in an effort to coordinate laws, particularly as they apply to business?

Hon. C. Hansen: This arises out of national initiatives under the Uniform Law Conference, not out of any particular bilateral relationship with Alberta. They have not yet introduced their amendments, but they are expected to do so.

Sections 43 and 44 approved.

section 45.

B. Ralston: These are all entitled "Transition," so I assume from that that sections 7.2 through 7.6 are there to guide the transition to the new definition when it becomes law. Is that correct?

Hon. C. Hansen: That is correct.

[1505]

[ Page 3886 ]

Sections 45 to 50 inclusive approved.

section 51.

B. Ralston: These next two amendments are to the separate act, the Repairers Lien Act. Can the minister explain the purpose of those amendments?

Hon. C. Hansen: The same changes that are being proposed will be made to the same processes under the Repairers Lien Act and the Personal Property Security Act. The two steps will be combined into a single 40-day demand period. A 15-day demand period in

section 5(2) becomes a 40-day demand period.

Just let me correct this here. The two steps will be combined into a single 40-day demand period, plus ten days for deemed receipt of notice. The 15-day demand period in

section 5(2) becomes the 40-day demand period.

Changes to

section 5(3) enable the person making the demand to register a financing change statement amending or discharging the registration upon providing satisfactory proof that the demand was given to the garage keeper, if the garage keeper does not comply with the demand or register a court order.

Sections 51 and 52 approved.

section 53.

B. Ralston: The next series of amendments are proposed amendments to the Securities Act. The first one is a change in the definition of "forward-looking information," striking out "results of operations" and substituting "financial performance." Obviously, it's felt that this better and more accurately describes forward-looking information. Can the minister explain the significance of that substitution?

Hon. C. Hansen: This is simply a change in terminology. The amendment replaces the term "results of operations" with the term "financial performance." Both terms are accounting-related terminology, and the change to financial performance is necessary to facilitate Canada's changeover to international financial reporting standards as of January 1,

Section 53 approved.

section 54.

B. Ralston: This is an amendment to

section 55, and the substantive part seems to be adding "a credit rating organization or a credit rating" to an area where the heading is "Approval of commission or executive director not to be represented." I gather it's simply to add that as one of the enumerated heads that can't be…. One can't represent that the commissioner or the director has passed on any of the merits of such an organization.

Hon. C. Hansen: What this amendment does is add the credit-rating organizations to the list of market participants. The regulation-making authority proposed in this bill will allow for the development of regulations to regulate credit-rating organizations. This amendment ensures that a person cannot improperly use any status a credit-rating organization may achieve under those regulations.

B. Ralston: I note, looking at the

definitions

section in

section 1, if I have it correctly, that a credit-rating organization or a credit rating is not a defined term. Can the minister explain why it's not necessary to define it and what is meant by those two terms?

[1510]

Hon. C. Hansen: It was felt that a specific definition is not required, as it is commonly understood in the securities industry — those companies that provide credit ratings and what constitutes a credit rating.

Section 54 approved.

section 55.

B. Ralston: This amendment proposes an amendment to

section 83. That's entitled "Obligation to send a prospectus." Can the minister explain? It appears to simply add the phrase "other prescribed document" to each subsection. If there's something else there, then perhaps the minister can elucidate.

Hon. C. Hansen: This amendment will facilitate the development of disclosure rules tailored to specific kinds of securities such as point-of-sale disclosure regime for mutual funds.

Sections 55 and 56 approved.

section 57.

B. Ralston: This is a repeal of

section 135(a). It appears to make reference, the same reference, to "other prescribed document." It appears to be, I guess, the gravamen of the amendment. Can the minister explain if there's anything other than that change?

Hon. C. Hansen: Again, this is to facilitate the development of these new disclosure rules. This specific amendment will extend the right to rescind or seek damages to purchasers who do not receive disclosure materials prescribed by the regulations.

[ Page 3887 ]

Section 57 approved.

section 58.

B. Ralston: This amendment falls in the

section or part of the act entitled "Civil Liability for Secondary Market Disclosure." It's a proposed amendment to

section 140.1 in paragraphs (

a) and (

b) of the definition of "core document." That appears to be a minor change substituting "an interim financial report" for "interim financial statements." There's the similar term of "results of operations" and substituting "financial performance."

If there's any further explanation, perhaps the minister can provide it.

Hon. C. Hansen: No. It is simply a change of terminology, again, to facilitate Canada's changeover to international financial reporting standards.

Sections 58 to 60 inclusive approved.

section 61.

B. Ralston:

Section 148. This is a

section now entitled "Evidence not to be disclosed." It would appear to be a

section protecting the confidentiality of an investigation insofar as the commissions undertaking investigation. Can the minister explain? It appears to be a more detailed

section proposed with this amendment. Can the minister explain the purpose of the change?

[1515]

Hon. C. Hansen: This change is in response to a court ruling from last July. It was a decision of the B.C. Court of Appeal where this

section was declared invalid in 12 months due to its overly broad application. The current provision that we are changing creates a general prohibition against a person disclosing evidence or information related to an investigation by the commission.

What this amendment does is replace the general prohibition with a provision that enables the commission to make an order prohibiting a person from disclosing, but only for the purpose of protecting the integrity of an investigation.

B. Ralston: Sometimes in court decisions there's a suggestion as to what might be more acceptable wording. Is that the case? I'm not familiar with the decision. Is that the case here, or is this an effort by the drafters to craft a broader response to the decision itself?

Hon. C. Hansen: The court did not suggest or prescribe language. This language, we believe, achieves the intention of the court and will address that specific issue.

B. Ralston: Just for those who might look for this passage in search engines, perhaps the minister could just briefly give the legal citation of the court decision so that it's easy to locate this section.

Hon. C. Hansen: It is Shapray v. B.C. Securities Commission.

B. Ralston: I'm sure the Clerk will confirm that a little bit more is required to locate it. Perhaps the full citation might be read. I'm sure those there can provide that.

Hon. C. Hansen: The specific information that I have, or the most specific information I have, is that it is a July 8, 2009, decision of the B.C. Court of Appeal, and it's Shapray v. the B.C. Securities Commission.

Sections 61 to 65 inclusive approved.

section 66.

B. Ralston: This is a proposed amendment to

section 183. It appears to be a slightly more substantive one. This deals with the power of the Lieutenant-Governor-in-Council — that's the cabinet — to make regulations. Can the minister, then, explain the purpose of this proposed amendment?

Hon. C. Hansen: This proposed amendment will provide the power to make regulations to regulate credit-rating organizations.

B. Ralston: Is there a proposed draft of what might be required in order to regulate credit-rating organizations? I suppose with that might come…. Has there been some regulatory difficulty that gives rise to this concern? I understand that it's proposed to incorporate credit-rating agencies into the legislation, but this is a different power. I'm wondering what gives rise to the request for these powers.

Hon. C. Hansen: The short answer is, no, there's not a draft regulation yet. This is an initiative that's being undertaken by all provinces — not just the passport provinces but Ontario, as well — to ensure there is a common regulatory framework for credit-rating agencies right across Canada.

Section 66 approved.

section 67.

[1520]

B. Ralston: One is tempted to refer to Sigmund Freud and the definition of a cigar, but I'll forgo that particular pleasure. Can the minister explain what is

[ Page 3888 ]

proposed here in an amendment to the Tobacco Tax Act?

Hon. C. Hansen: The purpose of this is to make sure that we have the ability to collect tobacco taxes appropriately as they are assessed against cigars. That required a definition for "cigar." Rather than trying to invent one ourselves, we have made the decision to use the same definition as is used in the federal Excise Act, which defines cigars for the purpose of importation of cigars into Canada.

Sections 67 and 68 approved.

Title approved.

Hon. C. Hansen: I move that the committee rise and report the bill complete without amendment.

Motion approved.

The committee rose at 3:21 p.m.

The House resumed; Mr. Speaker in the chair.

Report and

Third Reading of Bills

Bill 6 — Finance Statutes

Amendment Act, 2010

Bill 6, Finance Statutes Amendment Act, 2010, reported complete without amendment, read a third time and passed.

Hon. G. Abbott: I call second reading debate on Bill 8, the Energy, Mines and Petroleum Resources Statutes Amendment Act.

Second Reading of Bills

Bill 8 — Energy, Mines and

Petroleum Resources Statutes

Amendment Act, 2010

D. Donaldson: I rise to address the second reading of Bill 8, the Energy, Mines and Petroleum Resources Statutes Amendment Act.

[L. Reid in the chair.]

I'm very happy to address this act because it has implications not only provincewide and especially in the areas of the province that are impacted by oil and gas exploration and development right now but also in my area with the potential development of coalbed methane in the Sacred Headwaters region and around Telkwa, as well as the potential for the Enbridge Pipelines project. So I'm very happy to rise to discuss this bill.

The first area I'd like to talk about is the introductory remarks by the minister regarding this act, where he said that the changes in this bill are "a positive step forward toward a more balanced approach between industry and the affected landowners in the region." This was in regards to the oil and gas activities part of the act.

I'm happy that the minister made those comments, because he's recognizing that the approach right now is unbalanced. We've heard that throughout the region, and we've heard that throughout the province, that more balance is required, that the Oil and Gas Activities Act that came into effect in 2008 — and I'll have a bit more to say about how it came into effect — is unbalanced. The minister is recognizing that now.

So that's a positive step forward, and I look forward especially to the committee stage, where we will be looking at this act, this bill, on a section-by-section basis for some of that. But I'll make some more general comments right now.

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The act — the part of it that deals with the oil and gas activities

section — talks about the Oil and Gas Commission having expanded.…

Deputy Speaker: Hon. Member, may I ask you to hold your remarks in abeyance. The minister needs to move the bill.

D. Donaldson: Certainly, hon. Speaker.

Hon. B. Lekstrom: I am pleased to present the Energy, Mines and Petroleum Resources Statutes Amendment Act. Through this act, the ministry will amend provisions in two statutes, the Oil and Gas Activities Act and the Petroleum and Natural Gas Act.

The first set of amendments is to the Oil and Gas Activities Act, which received royal assent in the spring of 2008. The Oil and Gas Activities Act consolidates and modernizes the regulatory structure for British Columbia's oil and gas sector by improving permitting, improving environmental regulations, encouraging innovation, enhancing compliance and enforcement powers, and enhancing the Oil and Gas Commission's powers to respond to landowners' and stakeholders' concerns.

The regulations for the new act have been under development for the past two years. During this work minor issues were identified with the new act which, if amended, would strengthen the operation of the act and the regulatory structure. These are the changes which are proposed to the act today.

The oil and gas industry in British Columbia employs thousands of British Columbians and is the largest resource contributor to B.C.'s provincial revenues. In fiscal

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year 2008-2009 the oil and gas industry generated over $2 billion in Crown revenues. Since 2001 the industry has invested over $37 billion in the province.

The oil and gas industry has an exciting future for British Columbia as world-class unconventional gas plays are being discovered and developed. The Oil and Gas Activities Act will continue to drive the investment in the development of these resources while safeguarding our environmental and social values.

The second set of amendments under this bill is to the authorities and mandate of the Mediation and Arbitration Board under the Petroleum and Natural Gas Act. The board's role is to facilitate in the resolution of issues related to access by industry to private land. With the significant growth in the oil and gas activities in the northeast of the province, the role of the board in dealing with access issues by oil and gas companies is becoming more important every day.

The amendments are designed to strengthen the authorities of the board so that dispute resolution processes will be improved for both landowners and industry. The name of the board will be changed to the surface rights board to reflect the authority of the board, which is to deal with competing rights to the surface. The processes that the board will follow will continue to include mediation and arbitration.

Key changes to the authority and mandate of the board will allow landowners to initiate the process with respect to the right to entry, will allow the landowner or oil and gas company to bring forward a surface lease compliance complaint and will allow for disputes to be resolved through mediation or, if that fails, through an order for compensation.

It enables neighbours and tenants to bring forward claims for compensation for damages arising from oil and gas activity. It will allow the board to consider the real costs of negotiations to a landowner when issuing an award cost and enables the board to impose penalties or suspend an operator's right of entry to land for failure to comply with a board order or a provision of the act related to the rights of entry.

The proposed amendments to the Petroleum and Natural Gas Act were developed following consultations with the Northeast Energy and Mines Advisory Committee. The amendments to these statutes will enhance our competitiveness and support our thriving oil and gas industry while ensuring responsible development.

With that, I would move second reading.

J. Horgan: It's indeed an interesting turn of events that would have me standing in my place today as the official opposition Energy, Mines and Petroleum Resources critic speaking on amendments to the Oil and Gas Activities Act. Why that's interesting….

[1530]

My friend from New Westminster, who was a new member to the Legislature, will have to hear a bit of the history of this act before we get on to the substance of Bill 8.

The Oil and Gas Activities Act was introduced by the government in 2008. It was done so at the high point of the hysteria at that time on the government side with respect to carbon offsets, carbon taxes and reducing our greenhouse gas emissions.

Of course, we on this side of the House found it passing strange that in the midst of all of the furor and celebration by members on that side of the House and their desire — and ours, as well, on this side of the House — to reduce our carbon footprint, to reduce our greenhouse gas emissions…. The government and the minister of the time, Richard Neufeld — now ascended to the Senate, the lofty Red Chamber in Ottawa — introduced a 207-clause bill that was going to accelerate and expedite oil and gas development, mostly in the northeast but right across B.C.

When I rose to speak to what was then Bill 20, hon. Chair — and you would have remembered this, I'm sure, at the time — I spoke briefly at second reading. I said, at the end of my remarks, that I looked forward to the detailed clause-by-clause discussion, the meat and potatoes of legislation — the work that's just been done by my colleague from Surrey-Whalley and the Finance Minister from Vancouver-Quilchena with Bill 6.

These are substantive pieces of legislation, a number of clauses that have impacts on our daily lives with respect to the finance bill, but certainly the Oil and Gas Activities Act is going to have a significant impact, not just on landowners but also on industry.

When I took my place in 2008, I had every expectation that my colleagues and I would have an opportunity to go through each sentence in what was then Bill 20. You can well imagine my surprise on the 29th of May when in one minute — one minute — the government passed the Oil and Gas Activities Act without any debate at third reading. They used a vehicle called closure, or the guillotine. They stopped, suspended debate and passed the bill in one minute.

Here I am a year and a bit later having an opportunity to speak at second reading on the Oil and Gas Activities Act, which is an amendment to a bill that I never had an opportunity to speak to at third reading.

When I go through…. This is not really a prop. It's a weighty book of statutes here in the province of British Columbia. I have a wall of them beside me. The cameras can't pick that up, but there are numerous books holding all the statutes in the province of British Columbia.

When I turn to the Oil and Gas Activities Act section, it's but one page. Now, it was a 207-clause bill in 2008, when it was passed here with closure. When you read the one page, it says: "Parts 1-10, sections 1-118, not in force."

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So we used closure because we didn't want to debate these issues any longer. We didn't want to slow down the process. Closure was introduced. The bill was passed, and here we are a year and a half later, amending the bill. We're amending sections of the bill that are not in force.

You needed closure, hon. Minister and members of the government, to pass this bill because it was so important. All the work had been done. All the homework was…. There was no need to go clause by clause, page by page through this very thick tome which was then Bill 20. Here we are a year and a little bit later, and we're amending that bill because the homework wasn't done.

I give credit to the current minister for recognizing the glaring error of the time that his predecessor, Richard Neufeld, ascended to the Senate…. I'm hopeful that he has the parliamentary channel there. If he's awake in the Senate today…. It's getting late. It's close to the dinner hour in Ottawa, but I'm hopeful that he's tuning in to see what he has wrought here in the Legislature.

He introduced the bill. We had a brief discussion at second reading, anticipated third reading — committee stage — and final passage of the bill, perhaps with amendments — reasoned, thoughtful amendments that we would have brought forward on this side of the House after consultation with people in the community.

Well, the current minister went back home. We have to remember, and certainly it's no surprise to the minister because he lives in the heart — his constituency, Peace River South — of the oil and gas industry…. His neighbours were none too happy about this. At its core, the Oil and Gas Activities Act is about landowner rights and subsurface rights.

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Quite often, we have…. Of course, in 2002-2003 the revenues from oil and gas surpassed forestry here in the province of B.C. That was a monumental moment. It was passed without much fanfare. There was an expectation — I see the former Minister of Forests — that forest revenues would increase, get back to traditional levels. Unfortunately, that's not happened, and we've seen a downward spiral in the forestry sector as we've seen an increased activity in the oil and gas sector.

Revenues from this industry, this sector of the economy — fundamental to our social programs. That's why, in the 1990s, the New Democrat government of the day created the Oil and Gas Commission to try and accelerate activity in this region. The minister is well aware of that, and I have heard him on occasion give credit where credit was due and commend the NDP government of the time, back in the 1990s, generating and stimulating economic activity.

I tip my hat to him, because I know he will, when he wraps up the bill, be reminded of that and pay homage to minister Dan Miller for introducing the bill and creating so much wealth and economic opportunity in his community.

But ultimately, it's about landowner rights and subsurface rights. This is the interesting thing. I come from southern Vancouver Island. I grew up watching The Beverly Hillbillies . There's an expectation, an understanding, I think, in the general population that if you hit oil, "up from the ground comes a bubblin' crude" and everybody gets rich. Not so here in the province of British Columbia.

If you don't own the subsurface rights, you could have the largest pool of natural gas in the universe under your homestead in Dawson Creek and that is no value to you whatsoever, save and except what pennies fall off the table from those who own the subsurface rights.

Now, this is a longstanding debate. In the five years I've been in this place, we've had a couple of debates around how we protect or further protect landowners from those who have the good fortune of owning subsurface rights, whether it be for mineral extraction or whether it be for oil and gas.

I know that I speak from an inferior position in this matter with respect to the minister, because it is his back yard. His neighbours are involved in this, whether they be landowners or subsurface rights holders. It's a challenge finding that balance. Unfortunately, in 2008 the then minister, now a senator loftily ascended to the Red Chamber, didn't take the time to do his homework and do the due diligence required to try and find that balance.

I'm advised that I am to take the minister's word on it that we will be able to get back to clause-by-clause discussion of these amendments, and I'm hopeful he'll be able to keep that, although I know it's not up to him. The Government House Leader sets the agenda. He was the one who introduced closure. It wasn't the Minister of Energy and Mines at the time.

We're at the whim of the Government House Leader. I know he monitors the debates very closely, and I'm fairly confident that he will allow us the opportunity to do the due diligence and the work that we're required to do as legislators to go through this bill piece by piece.

Again, it's passing strange, and I know my esteemed colleague from New Westminster, a former Member of Parliament, would be shocked and appalled to think that you could pass a 200-clause bill in one minute. But that's British Columbia for you. That's the parliamentary tradition in this place. Let's use whatever vehicle is at our disposal to ram through legislation, contentious and otherwise.

Why this was contentious at the time — and I know my colleague from Stikine is going to talk about this and my colleague from Maple Ridge–Pitt Meadows — is that it was at the very time that the government was professing to have an interest and a concern about greenhouse gas emissions.

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There is no greater source emitter as a sector in this province beyond the oil and gas sector. There's a gas plant proposed in Fort Nelson that if completed and fully operational will increase our greenhouse gas emissions by up to 3 percent. We've passed legislation here — hon. Speaker, you know that; you've been in the chair or voted in favour of it — to reduce our greenhouse gas emissions by 33 percent by the year 2020.

Now, how we do that in 2010 by increasing our greenhouse gas emissions in one sector is a mystery to me, but I look forward to more magic and conjuring and pixie dust from the Minister of Environment and others on that side of the House to somehow find a way to get to that conclusion.

I want to talk, in the time I have remaining, about just what we're doing here in general terms, as we do at second reading.

The Energy, Mines, and Petroleum Resources Statutes Amendment Act, as I said, is designed primarily to fix the problems that exist in the Oil and Gas Activities Act. At that time it was consolidating or amending four pieces of legislation — the Petroleum and Natural Gas Act, the Oil and Gas Commission Act, the Pipeline Act, and sections of the Forest Practices Act. So it wasn't an insignificant piece of work.

[1540]

It was actually a dense piece of work. I know. I met and had a very thorough briefing from the deputy minister at the time — still is the deputy minister — and his staff. They walked me through the bill. They assured me that consultation had been exhaustive and complete and there was little or no opposition to the substance of the bill. Of course, that turned out to be incorrect. Here we are, a year and a half later, amending that bill that has not yet come into force.

As we go through the bill, there are two significant sections. One is amending the Oil and Gas Activities Act. The other one is amending the Petroleum and Natural Gas Act, if I'm not mistaken. I'm looking at the minister. He's nodding his head.

If those who are following this at home want to go to their interwebs and go searching for those two acts, they'll have a better understanding of what we're trying to do. At its core it comes down to how we balance what is traditionally, I think — and the minister can correct me or will correct me, I'm sure — agricultural activity in the Peace country.

Homesteaders didn't come to northeastern British Columbia to look for oil and gas. They came for economic opportunity through the land, whether it be through livestock or wheat and various other agricultural activities — the member for Saanich South is well familiar with this — and during that time there wasn't a lot of thought given to "up from the ground comes a bubblin' crude." There wasn't a Jed Clampett mentality there at the turn of the century, but that did develop over time.

Of course, now I've been to the Peace many, many times. I've visited with the minister in his hometown. Virtually everything there is driven by the oil and gas sector. Every family is touched in one way or another by that activity, for better or for worse.

I would think that on balance it's generally for the better, but I have also met and discussed and consulted with many, many landowners who are concerned that their agricultural existence is wildly disrupted when an oil and gas company makes a claim and brings their industrial activity into what has been a relatively tranquil and pastoral setting of many, many sections of farmland.

The trick here, I think, is the amendments that the minister is talking about — changing a name, changing the Mediation and Arbitration Board to the surface rights board. Now, I'm hopeful that we're not just putting new paint on an old building — and I'm getting a headshake on that — and when we get to third reading, which I know I've got a solemn commitment to do, we'll be able to have that discussion in more detail.

The challenge for the landowners, the farmers, the homesteaders, generational residents in the Peace country…. Their concern is that the compensation they receive for this sometimes massive intrusion on their way of life, their farm, their home is in agricultural terms rather than industrial terms. You're bringing, in some cases, trucks, wellheads, drill equipment, a significant footprint in an agricultural setting.

The cows apparently don't like it. Who could blame them? Who could blame any of the livestock for being concerned about massive industrial activity taking place in what used to be a place you would graze a little bit, maybe lie down, walk around, stick your nose up in the air? Well, now you've got to be very careful, or you're going to step into a wellhead, and down you go. I'm exaggerating, hon. Speaker. I know you'll find that surprising. But I'm exaggerating, although I might be getting a note from the Ag critic here any minute. Apparently not.

There's a massive intrusion in the agricultural life and quality of the people in that area, and when they are compensated, in some instances it's pennies on the acre. In other instances farmers have done very well, and in fact they're able to subsidize their…. In some seasons with drought conditions — it becomes subsistence farming rather than a business — they're able to offset their losses, or their lack of income from the land, through cheques from oil and gas companies that are accessing the land for industrial purposes.

Quite often, as has been pointed out to me, this compensation from oil and gas companies is greater than any compensation they'd get from the governments, whether federal or provincial, for the agricultural activity that's taking place there. We all need food to eat.

There was a member that used to say that all the time. It bugged me at first, and then I started saying it as well, because she headed out the door — Val Roddick, of

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Delta South. She had this mantra that she would go on about. Some members are nodding. And it was annoying at first, but it became something that I also joined in on.

We need food to live, and the Peace country has been historically the breadbasket of British Columbia. But now it is the oil basin and the natural gas home for many, many industries and many, many billions of dollars in revenue to the Crown.

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What we need to do…. I'm going into territory that the member for Saanich South would prefer to tread, I believe. We need to somehow find a balance not just between the industrial activity versus the agricultural activity, and have compensation, as we should, from those industries and those companies that are benefiting, but also a recognition by government that those agricultural values are valuable in and of themselves and should be protected and encouraged through programs and initiatives at the provincial level. I know my friend from Saanich South is tireless in her promotion of that.

The other issue that we've been talking about — and I had some questions for the minister earlier on in the session — was the issue of orphan wells. The Auditor General issued a scathing report. The minister dismissed it, alleged that staff had been working on it, and I think we see some of that work in this bill.

I look forward again to committee stage to ensure that the suggestions and recommendations that the Auditor General brought forward in terms of trying to manage and deal with potential environmental catastrophes in communities throughout northeastern B.C. can be addressed by the amendments that are proposed in this current bill.

I want to talk a little bit about NEEMAC, which is the Northeast Energy and Mines Advisory Committee. It consists, as the minister knows and many members may know, of landowners, industrial representatives and other stakeholders. Those other stakeholders — who are they? They're usually non-governmental organizations with an interest primarily in protecting and advocating for landowners as opposed to subsurface rights owners.

That balance is usually tilting towards those that have the most money. I don't know if that's a new phenomenon. I rather doubt that it is. I think that as long as there has been money, those that have it tend to do better than those that don't.

In the course of doing business in the northeast, landowners have been at a disadvantage historically and certainly were not aided and assisted in any way by Bill 20, which was brought forward and passed by closure in this place.

The minister advises me and has committed to ensure that the consultation that NEEMAC has been part of — or that the Northeast Energy and Mines Advisory Committee has been participating in — with the Oil and Gas Commission and others has been fulsome. And you don't always get what you want. Everyone understands that. You have to put a little bit of water in your wine, particularly at this season of the year.

The challenge, I think, for legislators and certainly for those of us on this side of the House is to ensure that industry doesn't have an upper hand in these negotiations and does not have the pen when legislation is being written.

I think there were many, when they came to see Bill 20 passed by closure, that were concerned: "Well, if this was such a good bill, if the Oil and Gas Activities Act was so important.…" Consolidating archaic and outdated language is an important thing, and the bulk of those sections that were passed by closure really did have nothing, really, to do with today. They had everything to do with modernizing language and ensuring that industry and landowners had one place to go to exercise their rights.

I think that when a bill is passed with closure, you have to have a pause. Any democrat, any parliamentarian will tell you that it's not a left and right issue. It's not an NDP or B.C. Liberal issue. If a government, any government, decides that they do not want to have fulsome debate on a piece of legislation, that's cause for pause.

It is with some satisfaction and comfort…. And I'm not trying to be too smug, hon. Speaker; you know me to be a humble fellow. I find it delightful, I have to say, to be standing here rubbing someone's nose in this.

I'm not going to bother rubbing the new minister's nose in it, but I certainly will take the opportunity to rub a senator's nose in it. What the heck. He's not here. He doesn't have to defend himself ever again. He doesn't have to talk to a constituent for the rest of his natural life. That's good for him. He makes more money. He's got a nice, I think, indexed pension.

I saw him at a conference the other day. He looks really good. So Richard Neufeld, good on you. You must be doing just fine there in Ottawa in the Red Chamber until you're 75. I think: "Thank goodness, they have to retire now." They can't stay there until they drop.

I do want to rub the former minister's nose in it, because I have the opportunity. What the heck. I'm on my feet. The Minister of Aboriginal Relations isn't even heckling me. I feel a little bit alone here without some input from him.

[1550]

Interjection.

J. Horgan: Oh, thank you, hon. Minister. Thank you very much. Very kind.

Again, I'm not going to take up any more time. I've got other business to attend to. There are other members who wish to speak.

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I just want to again commend the minister for bringing forward amendments to a bill that has not yet been proclaimed, or it has been proclaimed but is not yet in force. I think that's rapid response. When you find that something is not working before you've even implemented it and you take steps to fix it, I think you should pat someone on the back.

D. Black: It might go in Guinness records.

J. Horgan: It might go into it. Well, we had a Guinness Book of Records here for things being before the courts, but they didn't end up printing that.

It is a unique opportunity, and there are some people in the gallery. I don't think you'll ever see this again in any legislature anywhere in the world — where someone will bring forward amendments to pieces of legislation that are not yet in force.

With that final comment and a tip of my cap to Senator Neufeld and a gracious thank-you to the minister for assuring us that we will not see closure on Bill 8, I will take my seat.

P. Pimm: It certainly is refreshing to listen to the member for Juan de Fuca and how he goes on about the Senator. It's a very interesting debate, I must say. I think, in fairness, that the Senator, if he were here to speak for himself, would certainly have a fairly decent argument for you. I won't take his spot, because I don't think that's my duty.

As you all know, the oil and gas industry is huge in my area. As the member for Juan de Fuca said, it touches nearly all of the people one way or another, whether it's the farmers or the people in the agriculture industry, where they have to get a second job to make their income through the winter to keep their summer jobs on the farm available for them. Lots of times that's what they have to do.

Anyhow, the government has created one of the most competitive environments for natural gas in the petroleum exploration in North America right here in the province of British Columbia, and I think that's very important. Certainly, with the resources that we have — the Horn River and the Montney coming up in the future — I think we have to make it attractive so that we can all benefit from the oil and gas industry.

The oil and gas industry, like I said earlier, is the largest employer in our area. Most people in northeastern B.C., one way or another, are involved in the oil and gas industry.

[C. Trevena in the chair.]

B.C.'s natural gas and petroleum industry is the largest source of resource revenue. In 2008 it was the largest resource revenue for the province. It generated over $4.09 billion worth of revenue. That's pretty amazing, because when I first walked into this building, it was…. It's not even one of the resources that are identified in the halls of the Parliament Buildings here. I think maybe that's something we need to have a look at, and maybe we need to get the oil and gas industry up on the walls of this building, along with agriculture and forestry and that sort of thing.

The province is continuing to attract new investment through the innovative infrastructure and royalty programs that they've introduced. In 2008 industry capital investment was estimated at $8 billion. That's three times the amount invested in 2001.

In fact, since 2001 the industry has invested almost $38 billion in British Columbia. I think that's something we can all be very proud of, and it certainly goes a long way to helping out our health and education systems. The oil and gas industry certainly is an important part of the provincial coffers.

The natural gas and petroleum industry creates 34,000 direct and indirect jobs. That goes to show that it really is an important part of our industry and a major employer for the province.

The province continues to provide incentives — and I might underline the word "incentives" — not subsidies for natural gas and petroleum development. New royalty programs were developed to encourage summer drilling and production of wells that were previously not economical. Basically, a lot of that goes a long way in the summer drilling program.

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One of the things that a lot of you from down here and, probably, my colleague from Juan de Fuca…. He probably doesn't understand that half of our country up there is what they call muskeg. It's not even accessible through the summer months unless you put these incentive programs in place.

That's one of the things the incentives have done. It's allowed us to have a year-round program where we can actually get into the areas, where we can keep contractors working year-round rather than the three…. We used to call it the 90 days of hell, actually, where you started January 1 and you went till the end of March. Some survived, and some may not have. But this summer drilling program has certainly changed that a lot, and we now have a year-round industry that provides more certainty for our employees for the benefit of all.

This act includes amendments to the Oil and Gas Activities Act and the Petroleum and Natural Gas Act. The bill allows for significant enhancements to the regulation of the oil and gas industry. The changes will allow for a positive step forward to a more balanced approach between industry, landowners and stakeholders.

Through these changes, the name of the Mediation and Arbitration Board will be changed. It's going to be changed to the surface rights board, and I think that

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is important. I do want to note that the changes came from an advisory group called NEEMAC. NEEMAC is a board that consists of area landholders. I meet with these people on a pretty regular basis, and they're pretty happy with some general direction that they've had and the input that they've had into this particular bill.

One of the major changes under the bill is that it will allow the landowners to request mediation for surface access, giving the board authority to deal with issues related to compliance by either party. It also extends the board's authority over compensation claims and for damages arising from the oil and gas activity. It also empowers the board to include real costs incurred by the landowner at the end of the process.

These are all very important changes. There's stuff that wasn't in the last act. Certainly, the minister has taken the advice of some of the people that were on NEEMAC and others in the industry, and I think it's going to be very positive for all.

This act is going to increase the regulatory powers of the Oil and Gas Commission and enhance the government's ability to protect the environment from potential impacts of natural gas and petroleum development. The OGC will have expanded powers to use money from the orphan site reclamation fund to clean up sites where no oil and gas owner can be held accountable.

They can't be held accountable because they can't even be found. These might be companies that have disappeared or have sold off their assets or whatever. It's very important to note that the industry is going to be paying for the orphan well fund, and I think that's a very positive step in the right direction.

Like I say, the orphan site reclamation fund is created through tax on industry only. It's important to note that it used to be funded through the government coffers, and it's now going to be borne by the industry — so another change in the positive for the people of British Columbia.

All elements of the upstream natural gas and petroleum sector activities are regulated under the Oil and Gas Activities Act.

This bill allows for the amendments regarding approvals for pipeline crossings of roads. This will better accommodate community interests and government transportation objectives. Where a pipeline permit holder requires access to land within a highway or municipal road, the pipeline permit holder must obtain an authorization under the Transportation Act or other appropriate enactment.

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Let's talk a little bit about the role of the Oil and Gas Commission. The Oil and Gas Commission was developed, as the former speaker said, in the late '90s, and it certainly has been a great organization over the years. They've streamlined the industry. Actually, they do an extremely good job, and they do it in a very timely manner as well. It's an independent, single-window regulation agency with responsibilities for overseeing natural gas and petroleum operations, including exploration, development, pipeline transportation and reclamation. That's what the OGC does.

Regulatory responsibility is delegated to the commission through the Petroleum and Natural Gas Act, the Pipeline Act, the Forest Act, the Forest Practices Code of B.C. Act, the Heritage Conservation Act, the Land Act, the Environmental Management Act and the Water Act. Certainly, it takes in all of the organizations that are out there, looking after the environment and making sure that things are done properly. Again, the OGC does an extremely good job as the independent board.

The Crown corporation and commission's accountabilities extend to affect the communities — First Nations, client companies, their representative associations. Among its more specific objectives are public safety, conservation of petroleum resources, fostering a healthy environment and ensuring equitable participation in all production.

The commission's core roles include assessing applications for natural gas and petroleum activities and issuing approvals when appropriate; ensuring industry compliance with legislative, regulatory and permit-specific requirements, in part through inspections and other monitoring enforcement activities; and actively consulting, like I said, with First Nations on applications and operations. They take that role on.

The other thing that you might want to note is that the OGC is funded through the fees that are collected when you do a permit application. The industry actually pays for all the services that the OGC delivers.

The thing we must understand is that the oil and gas industry is vital to northeast B.C. and to British Columbia as a province in general. I think we all like the revenue that it brings in and, certainly, we have to bring in that revenue in a way that works well for all the stakeholders — for the landowners, for the industry, for the province. It has to work for everybody.

I think this bill goes a long way to doing just that. It's going to keep our industry strong, it's going to keep our environment solid, and our landowners will have more input into the process.

I'll let the next person take his place.

D. Donaldson: I am very privileged and happy to rise to speak to second reading of Bill 8, the Energy, Mines and Petroleum Resources Statutes Amendment Act. I'll describe a few general remarks. I want to say that I look forward to the committee stage on this bill, when we can go through it

section by

section and get some more specific answers and details about the act.

As my colleague and Energy critic from Juan de Fuca earlier remarked about what this bill does, and he was eloquent and detailed in his comments about that, it

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introduces amendments. Some of the areas that it introduces amendments to are in the Oil and Gas Activities Act. This is

an act that was introduced in 2008 by closure, meaning debate was limited. There was no extensive debate on the actual intention of the act, and then the details, the sections of the act, were never brought into force.

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This led to a comment by a lawyer from the Pembina Institute who closely follows these matters. He said that bringing in this act now, which creates amendments to

an act that was never enforced, doesn't reflect particularly well on our law-making process in B.C. — that we need to amend

an act before it has even come into force. Obviously, it was a rush job, bringing the original act in. Now I'm glad we're going to be able to actually talk about the intent of that act through this Bill 8, which is an amendment to

an act that was never enforced.

This bill applies to a very important sector for provincial revenues. This bill applies to oil and gas, and that brings significant revenues into the provincial treasury, and it has a substantial impact across the province as well. That's why I'm very happy to speak about it, because it's not only in the northeast but across the entire province that we feel the impacts of the oil and gas industry, both positively and sometimes negatively.

The bill deals with the Oil and Gas Commission, and the Oil and Gas Commission authorizes and issues essential permits and approvals necessary for exploration, drilling, pipelines and processing in the oil and gas sector. That's important not only, as I said, across the province but in my area as well, in Stikine, where there are proposals for two coalbed methane projects — one in the Sacred Headwaters and one in the Telkwa area — and where a broad spectrum of people have voiced their opposition to these projects.

They'll require drilling and pipelines. If it comes into effect, it will be under the Oil and Gas Commission, and then this relates back to Bill 8, as well as the Enbridge pipeline, which we've seen widespread opposition to across the province.

I'm very happy to be speaking to this bill generally in second reading, because it covers topics such as these that are very important to Stikine and important to the rest of the province.

In his opening comments the Minister of Energy, Mines and Petroleum Resources introduced this act in first reading. He talked about new compliance. This act will create new compliance and enforcement tools for the regulator, the Oil and Gas Commission. That may be so — and we'll get into that, and we'll see, when we go through committee stage — but a compliance tool is only as good as what you have on the ground to enforce it and to regulate it and to monitor it.

What we've seen in the past are circumstances where there aren't enough compliance people on the ground to monitor what needs to be monitored under the act. So it might be nice to create tools, and we might be doing that with this act. We'll see. But I look forward to budget estimates with the minister, when we can actually talk about the compliance resources which are under the Ministry of Energy, Mines and Petroleum Resources.

In fact, it's been pointed out to me that in years gone by, in the last several years, recorded compliance infractions in oil and gas activities have actually decreased. Others have pointed out to me that so have the people on the ground to enforce the compliance.

If you don't have the people on the ground, then you don't know if companies are adhering to the act. The Oil and Gas Commission may have these regulatory tools, but they don't have the people on the ground to monitor them. Nothing changes practice-wise, but the actual infractions decrease because there's nobody out there to report on them.

The minister also described in his introductory remarks that Bill 8 is a positive step forward to a more balanced approach between industry and the affected landowners in the region. I think that's a statement well worth analyzing. It gives the background or the impression that there has been an unbalanced approach. I think, hearing from people across the province whose land is impacted by these projects, that there has been an unbalanced approach.

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I look forward to the committee stage debate where we can get into what the minister proposes is going to be a more balanced approach in this. I recognize that he has now said by extrapolation that there has been an unbalanced approach, and it needs rectifying.

He also discussed in the introductory comments that there are some gaps and that this act "will ensure that there's a robust and comprehensive regulatory structure applicable to the oil and gas sector." Again, to me that indicates that there hasn't been a robust and comprehensive regulatory structure yet applied and that he does admit that there are gaps. We'll be looking forward to going through this bill in detail at the committee stage to really see if the robust and comprehensive regulatory structure is addressed.

Finally, in the introductory comments this bill also deals with changes to the Petroleum and Natural Gas Act, and the minister said that some of the changes would give authority to deal with issues related to compliance. Compliance requires resources, resources on the ground, and so once again in the budget estimates — where compliance under the Ministry of Energy, Mines and Petroleum Resources will fall — we'll be looking forward to the minister answering questions about how the resources will be there to ensure that there are people on the ground to monitor the compliance that this bill will eventually be dealing with.

The bill will deal…. It says that some of what's going to be addressed is that the Oil and Gas Commission

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"will have expanded powers to use money from…orphan site reclamation funds to clean up sites where no oil and gas owner can be held accountable." Well, that's an interesting proposition, because it relates back to just last month when the Auditor General, John Doyle, issued a report on oversight of orphan wells as well as what's been going on with oil and gas sites in particular.

An independently issued report by the Auditor General said that the B.C. Oil and Gas Commission must "improve its oversight" of oil and gas sites in order to adequately manage the risks of contamination during drilling, production and final site restoration.

The Auditor General also pointed out in his report that corporate liability for site restoration at B.C.'s approximately 20,000 past and present wells exceeds $1 billion. The orphaned sites are part of that, and the bill says that it will address orphaned sites, so we look forward to the committee stage when we'll be talking about how it does that specifically.

The Auditor General also noted that a junior exploration company pays only a single one-time restoration deposit of $7,500, although the minimum cost to restore just one individual well site is $100,000. Again, the issue of orphan sites and the fees that can be charged by the Oil and Gas Commission regarding this is something that needs attention and that we'll be pressing the minister on — whether this bill addresses that.

Additionally, the Auditor General's office first reviewed the government's oversight of the oil and gas contamination risks in 2002-2003, so seven to eight years ago. The Auditor General had said he expected more progress on this. We hope that Bill 8 is something that we can point to as more progress on the contamination risks, especially with the orphan well sites, but we'll wait to see if that's the case during committee stage.

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Finally, the Auditor General pointed out that the Oil and Gas Commission isn't providing enough information on its oversight of the industry. The very commission that this bill is hoping to give more tools to is not, in the Auditor General's opinion, providing enough information on what it's actually doing. Therefore, it's difficult for the public and people who have concerns to actually find out what the Oil and Gas Commission is reviewing, what they're finding faulty, what they're not finding faulty and how they're doing their job.

Bill 8. Again, we just received it yesterday, but in reviewing it…. During the committee stage we'll have more time to review it, but in this second reading of the bill…. From what I understand, under this bill the Oil and Gas Commission will have a broader authority to collect fees and levies that support it in regulating the industry. The previous member alluded to this, that the Oil and Gas Commission activities are paid for by the fees and levies that it collects from industry.

In fact, the Oil and Gas Commission Act sets out that the commission is funded with revenues from levies on production and fees for approval. This has been pointed out to me by a number of people who were concerned about the oversight of the Oil and Gas Commission as a fault and as a trap, a potential trap. They liken it to the fox taking care of or overseeing the henhouse, in that if you are dependent on your funding from the very industry that you are supposed to be issuing permits to, then there's potential for decisions not to be made in the best interests of the public.

If you have to depend on revenues from levies on production, then what if there's concern about the production? Are you free to speak about and report on those concerns? Would you suggest or recommend that production be curtailed in certain areas if your funding depended on that production? It's just not a very good model to be putting forward when it's so important.

It's so important that this agency, the Oil and Gas Commission, have the trust and the faith of the public because it doesn't force the regulations that government puts before us like in Bill 8, and it has the authority to issue fees and levies.

We have to have the utmost faith in those kinds of commissions, and right now, with the revenue generated from levies on production and fees for approvals…. There's another example. If I have the authority to approve certain projects, but my financial existence is beholden to those approvals, then somebody viewing from the outside and looking in would say: "Well, that leaves open a lot of leeway for, perhaps, decisions not to be made in the best interests of the public."

I look forward in Bill 8 to the committee work where we will explore further what the minister has put forward in the hopes that some of the amendments will address these concerns that I hear from the public on a regular basis around the issues I've described, around the credibility of the Oil and Gas Commission.

I'm not casting aspersions on it. I'm just trying to help the minister and the government come up with the best model that will have the most faith for the members of the public who have concerns about projects that proceed on land that is part of the commons, part of our legacy and our heritage and what we pass on to future generations. This is especially true when it comes to coalbed methane exploration in my area and the Enbridge pipeline.

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With those comments, I will conclude my remarks around the second reading of Bill 8, and I look forward to the committee stage where, with the minister, we can get into detailed specifics on clause-by-clause.

D. Barnett: I rise today to speak in support of Bill 8, the Energy, Mines and Petroleum Resources Statutes Amendment Act. As I have mentioned before, the economic engine of this province is powered by small

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business and the resource industries — forestry, mining, oil and gas.

The oil and gas industry is very important to the economic well-being of British Columbia. Why? Jobs and revenue. B.C.'s natural gas and petroleum industry provided the single largest source of revenue, $4.09 billion, for the province in 2008. Natural gas and petroleum revenue has increased by nearly 60 percent since 2001 and is now more than three times the average in the 1990s. In northeast B.C., where most natural gas and petroleum activity is focused, the unemployment rate in 2008 was only 4.8 percent.

These numbers illustrate the importance of the industry to the entire province and how much work this government has done to make B.C. one of the most competitive environments for natural gas and petroleum exploration in North America.

There are several regions in North America where energy companies operate. The investment conditions in B.C. have drawn capital in. This keeps people employed. The province provides incentives, not subsidies, for natural gas and petroleum development. New royalty programs were develope