British Columbia Hansard — Tuesday, May 8, 2018, p.m., Issue 131 (41st Parliament, 3rd Session) (20180508pm-House-Blues)
20180508pm-House-Blues
British Columbia — Debates (Hansard)
Third Session, 41st Parliament
(2018) OFFICIAL REPORT
OF DEBATES
(HANSARD)
Tuesday, May 8, 2018
Afternoon Sitting
Issue No. 131
ISSN 1499-2175
The HTML transcript is provided for informational purposes only.
The PDF transcript remains the official digital version.
CONTENTS
Orders of the Day
Second Reading of Bills
Bill 17 — Motor Vehicle Amendment Act, 2018 (continued)
A. Olsen
J. Yap
D. Clovechok
R. Sultan
Hon. M. Farnworth
Bill 29 — Voluntary Blood Donations Act
Hon. A. Dix
N. Letnick
S. Furstenau
Hon. A. Dix
Bill 25 — Real Estate Development Marketing Amendment Act, 2018
Hon. C. James
S. Bond
A. Weaver
D. Barnett
T. Redies
Hon. C. James
Bill 28 — Public Interest Disclosure Act
Hon. D. Eby
M. Lee
A. Weaver
Hon. D. Eby
Bill 19 — Protected Areas of British Columbia Amendment Act, 2018
Hon. G. Heyman
P. Milobar
S. Furstenau
S. Thomson
S. Chandra Herbert
J. Rustad
L. Krog
D. Barnett
A. Olsen
Hon. R. Fleming
M. Stilwell
Hon. G. Heyman
Proceedings in the Douglas Fir Room
Committee of Supply
Estimates: Ministry of Mental Health and Addictions
Hon. J. Darcy
J. Thornthwaite
S. Bond
J. Isaacs
16:09:03, P. Milobar, “need to be undertake.” changed to “need to be undertaken.”
TUESDAY, MAY 8, 2018
The House met at 1:34 p.m.
[Mr. Speaker in the chair.]
Orders of the Day
Hon. M. Farnworth: In this House, I call continued second reading debate on Bill 17, the
Motor Vehicle Amendment Act. In Committee A, I call the estimates for the
Ministry of Mental Health and Addictions.
[1:35 p.m.]
[R. Chouhan in the chair.]
Second Reading of Bills
BILL 17 — MOTOR VEHICLE
AMENDMENT ACT,
(continued)
A. Olsen: It’s a pleasure today to rise to speak, at second reading, to Bill
17. I would like to recognize the minister and the ministry for the
substantial challenge that they face as we are now starting to get into
a body of work that the minister has to deal with, with respect to
cannabis policy, as the federal government is moving towards a different
regime for controlling cannabis in our country. I do want to recognize,
as I’m working through these bills, that the minister has got, in many
cases, moving targets that they’re working with. That can’t be easy when
you’re creating legislation.
I think this bill, when it comes to the Motor Vehicle Amendment
Act, is an example of that. So I just want to acknowledge the challenge
that the minister and the ministry have and, as well, how incredibly
important it is that we get this piece of legislation right.
Public safety is incredibly important. Getting it right is going
to be a challenge, acknowledging the fact that there’s a reason why this
country is moving towards legalization of cannabis and, perhaps, that
there are quite a bit of people partaking in cannabis out on the
streets. I think that it’s important that we get this piece right and
acknowledge that even the ability to test drivers who might be under the
influence of cannabis is a substantial challenge.
As I see this, this bill will be passed by a regulation.
Therefore, I expect it will also be evolving over time as we and as
technologies…. As we become more experienced on this issue, I expect
that there will be changes that are made through regulation.
Of course, we’re going to be moving this forward to committee, but
at this point in time, I just want to acknowledge early that I think
that one of the key pieces to diminishing the amount of cannabis
consumption and driving will be education. I note that the government
has already begun a fairly substantive campaign. This would be one
campaign that I certainly won’t complain about public resources being
put into, in a substantial way, to ensure that youth right through to
adults are educated and given the information to ensure that we decrease
the instances of consuming cannabis and driving.
I note that I grew up in the late 1980s and 1990s. Even since that
time period to now, we’ve had a substantial change in the public
perception around drinking and driving. I would credit that, at least
from my experience, as a great deal due to the public education that was
undertaken by previous provincial governments going back a few decades —
having it front and centre in our high schools and having the
conversation and the road-check system and bringing it to the public’s
awareness that it’s not safe to be consuming drugs or alcohol and
driving.
Certainly my hope — and probably outside the purview of this bill
— is that the government does take advantage of the substantial
opportunity to educate British Columbians and continue to do it. As I
note, to a great extent, it’s already happening.
Finally, before I take my seat, I would just like to also point
out that we’re not the only jurisdiction that struggles with the ability
to test drivers or the ability to overcome the challenge of THC
remaining in the bloodstream, unlike alcohol. There are significant
challenges that THC poses that alcohol does not. We’re not the only
jurisdiction right now that’s challenged with that.
[1:40 p.m.]
Of course, every jurisdiction in Canada will be looking at that
and dealing with it in their own way. In addition, I think jurisdictions
in the United States of America are also looking at this. Some are
getting it right; some maybe not.
I see that the minister for jobs, trade and innovation is here.
This is a significant opportunity to drive innovation, to put a
challenge out to the innovators in our society and say, “We’ve got a
really wicked problem here, and that is that the federal government is
moving towards legalization, creating a different system of controlling
cannabis, and we need tools to be able to hand to our public safety
officers, to keep the public safe,” and turn the amazing minds of
Canadian colleges and universities on to this. I’m sure that they
already are — but maybe some kind of challenge to really see if we can
come up with a solution.
I’ll just leave it at that. It was some good luck that the
minister was here today, and I had an opportunity to present that to him
directly in the House today.
Having said that, I look forward to the committee stage of the
discussion and the debate. We’ll be going through this clause by clause,
and I look forward to that. I do have some questions and some
clarification of the minister and the ministry, and I look forward to
that opportunity. At this time, I’ll take my seat and thank the minister
for the good work on this bill today.
J. Yap: I’m honoured to take my place in this debate on Bill 17, the Motor
Vehicle Amendment Act, 2018.
This bill is one which we have been expecting, with the federal
government moving towards completion of the legislation to legalize
non-medical cannabis for use by Canadians. Bill C-45 is now being
debated in the Senate, and we await what everyone expects will be
approval sometime in the summer. So of course, every province, ours
included, will have to prepare for this new reality of a world with
legal recreational cannabis for use by the general public.
This is an issue that has been of great interest to my
constituents. Almost everywhere I travel around my constituency,
throughout Richmond, I find that folks have an opinion on this issue.
Many are quite concerned as we move towards a world with legal cannabis.
It’s reflected in the views of many in the community in Richmond, and
the local government of Richmond — quite concerned with how voters in
Richmond feel, the people of Richmond feel — have resolved that Richmond
will do everything that it can to not have cannabis freely available
within the confines of our community in Richmond.
So this is a topic that is on the minds of many that I encounter
in my riding. As I meet constituents in my office, around the community,
door-knocking, talking to them, many are concerned with what this means
for our families, for youth. In respect to what this means, this bill,
Bill 17, will endeavour to ensure that, with regard to public safety on
our roads, this is absolutely maintained.
Our previous government took steps to ensure that we had among the
most rigorous restrictions against drinking and driving across the
country, and I’m glad to see that this bill will continue with the
practice of immediate suspension — or IRP, immediate roadside
prohibition. This will be expanded under the act to include prescribed
drugs.
Cannabis will also be captured by this, and I think that is
something that we support. We want to ensure that, while some in my
community may not like this, we will do everything we can to ensure that
our roads are safe, our highways are safe, our community is
safe.
[1:45 p.m.]
Certainly, as the general public moves into this new world of
legal cannabis — that we can be assured, with proper laws and
regulations, that we can maintain public safety.
I just want to address a couple of points here. While I am
supportive of the general principle that we do need to regulate cannabis
use in driving…. I’m sure that in the committee stage of debate, some of
the specifics will be canvassed, and we will hear what the government’s
thinking is on some of the specifics. We want to ensure that the rules,
while firm, are also enforceable and that we will minimize or not have
the opportunity for people to be wrongfully accused.
I see that there will be in the legislation an evaluation officer,
who will be the expert, who will, at roadside checks, be able to
ascertain, based on training and expertise, if a driver is under the
influence of THC.
One can use one’s imagination to think that with more and more
opportunities for people to be exposed to those using cannabis that
secondhand smoke from a cannabis device or a toke would potentially….
Secondhand smoke would be consumed by someone not participating in using
the cannabis.
How will we ensure that someone who has been in a room where
there’s a lot of use of cannabis, a smoke-filled room, and then is the
designated driver, for example, and drives friends home. And then is,
you know, facing a roadside check. How does that work out? How would
that work out? We want to ensure that people are treated
fairly.
Of course, we want to ensure that the government puts in place the
resources so that we do have properly trained evaluating officers who
can help to help our law enforcement to ensure that our roads are
safe.
I think that the general approach of this bill…. We will canvass
some of the specifics in committee stage, but this is a bill which we
support. We do, again, want to emphasize that — I’m speaking on behalf
of many of my constituents, who are very concerned, as we move into this
world with legal cannabis — we will do everything we can to ensure that
the community is safe, that public safety is maintained, that our roads
are safe and that we have the tools, the rules and the enforcement to
make sure of that.
That is something that…. I find I have to reassure more and more
of my constituents who are concerned as cannabis is about to become
legal. This bill, we hope, will fulfil that requirement. We can assure
not just folks in Richmond but across our province that we’ll ensure
that public safety will be maintained.
I appreciate the opportunity to share some thoughts on Bill 17,
which we support. I look forward to the opportunity to get into a little
more detail as we go to committee stage of debate.
With that, I will take my seat.
D. Clovechok: It’s an honour to stand here in this House today, a representative
of the safety of the people that I represent in Columbia
River–Revelstoke, and also speak to Bill 17. Of course, it’s top of
mind, as my colleague just mentioned, in my riding too, around public
safety and how that’s all going to unfold and unravel.
Also, a big concern for me is around police safety. We’ve got to
make sure and ensure that that’s there. We’ll talk a little bit about
that.
[1:50 p.m.]
I also want to start off by saying I support the intention of this
bill. It’s a good one. It’s a bill that will make sure our friends, our
family, our colleagues, our neighbours and everyone else are safe on our
streets and that people that are under the influence of marijuana aren’t
getting behind the wheel and endangering themselves and
others.
I want to say thanks to the minister for his time and, always, his
willingness to have joint meetings. Yeah, you got that. This bill is
just one….
Interjection.
D. Clovechok: Well, there you go. I mean, you guys are fun over
there.
Interjection.
D. Clovechok: Exactly. You’re on it. Good.
Bill 17 is part of a suite of legislation, I’m sure, that’s going
to come around, in terms of this. But after reviewing this legislation,
I do have some overarching questions, maybe even leading to some
concerns.
To begin with, I’m relieved that the government is taking this as
seriously as they are. I think even the most passionate of marijuana
advocates would be open and understand that it’s dangerous to get behind
the wheel impaired on any substance, including marijuana, and that
certainly does impair drivers.
It wasn’t long ago that we were relatively ignorant around alcohol
abuse and driving. It has taken us a long time as a society to get to
where we are today, around the vision that people shouldn’t be drinking
and driving. Groups like MADD, and so on and so forth, have done an
amazing job. We have to make sure that the same applies to marijuana,
that we have that same kind of exposure and that same kind of
support.
Cannabis and driving is going to change the environment associated
with driving impairment. There’s no question about this. To this, the
concern that I have is that we are rushing ahead, I think, without
giving police the adequate resources and tools and training that they
need. Certainly, I recognize that this is not necessarily the provincial
government’s bailiwick. It’s a federal government issue, and I’m sure
that some of the things that the feds are doing are making you want to
lose your mind. Nonetheless, I know you’re going to get through
that.
In my humble opinion, the federal government is rushing forward on
this process without giving the provinces the tools and the money for
those tools that we need to deal with the daily ramifications of this
legalization of marijuana, specifically around the police.
This bill is a good example of that. So let’s envision a police
check somewhere in B.C. and the sequence of events that will happen to
you if you happen to go through one. Currently drivers, if you’re going
through a stop check, will roll up and speak to a member, and that
member will have a brief, hopefully, interaction with you and a polite
interaction with you and determine that you’re not driving under the
influence. You’re in there for a short delay, and it’s for a good cause,
so most people don’t mind doing that. Most of the members that I know
are very, very professional and polite about that.
If a member suspects that the driver is under the influence,
they’re going to be required to take a standardized field sobriety test.
That is an SFST, which consists of some preliminary questions, an eye
exam and some motor tests, movement tests, just to see and determine, on
that road, if that individual is impaired.
If the sobriety test indicates impairment by drugs, the driver
will be arrested and taken to the detachment — I use a detachment
because that’s where I live, in an RCMP area — to be evaluated by a drug
recognition expert, a DRE. The DRE will either gather a saliva test or a
buccal sample, which is a cheek swab, to determine. It’s technical, and
this is part of the training that these people are going to need to have
in order to make those conclusions.
At the conclusion of that DRE evaluation, if the DRE member has
formed an opinion that the person’s ability to operate a motor vehicle
is impaired by a drug category, then a demand for a urine or blood
sample will be made, and that will have to be provided. It all goes from
there into the forensic labs and so on.
The concern I have is that I hope police departments and
detachments across the province will be given all the testing equipment
and training to use it as soon as possible. I think it’s incumbent on
any government in this country, including, obviously, the one here in
British Columbia, to make sure that every police member in this province
is trained so they are clear about what they can do, and they’re clear
about what they cannot do with the new scenarios that marijuana is going
to present to them on a daily basis as they’re out in the field
working.
[1:55 p.m.]
My experience with the RCMP, generally speaking, is that they’re a
force that always is ahead of the curve, but they’re still going to need
help. That doesn’t mean that the other police services throughout
British Columbia aren’t going to need that same help.
Members are already demanding this training — I’ve heard that from
my own detachment — to make sure that they’re not doing the wrong things
as they uncover what will be a legal substance, which is now “illegal,”
and are also able to conduct investigations in a very proper
manner.
We can only assume that there will be one expert at most check
stops, available at a stop. If he or she is engaged with a driver, then
there’s going to be excessive waiting lines. If you’ve ever been through
a check stop and have manned one of those check stops, you realize that
the traffic does back up. If there’s only one trained officer on site,
it’s going to take a long time to get people through, especially if
they’re suspected of doing that.
Obviously, that member may be taken from the detachment. As the
previous member earlier on today mentioned, there’s overtime issues and
all that sort of thing associated, so there are some real financial
consequences behind all of this as well.
It’s my understanding that the ministry is planning to increase
the number of officers trained to administer field sobriety tests, as
well as drug recognition experts. I support this. I completely support
this, but I’ve got to ask, first of all, where’s the funding coming
from, which is a fair question.
I would really like to know what the per-member training cost will
be. How many members are planned on being trained, and what is the
timeline for that training?
I also have some concerns about consistency. Obviously, our
constitution protects the rights of people. Drug recognition experts are
human, and mistakes can be made. I’m not sure they won’t have any
problems identifying somebody who is on drugs or alcohol or they won’t
have any problems identifying those who aren’t, who are
sober.
Everywhere with marijuana is somewhere in the middle. It’s a bit
of a grey area, and it’s subjective. It will become subjective, based
upon that member.
This is why we have breathalyzer tests for alcohol. They’re
scientifically proven, and they work. That’s why they’re administered
for objective evidence, because when you take a charge to the Crown, you
certainly want to make sure that that charge has every chance of
succeeding.
This is too important to leave to subjective evidence, by
definition, because it varies from person to person. Each person
metabolizes alcohol differently. Each person will metabolize marijuana
differently and ingest the THC.
If somebody loses their driver’s licence because they failed a
breath analyzer, that’s one thing. When subjective judgment comes into
play, to me, that feels like a recipe for lawsuits and a significant
increase in Crown files and the jamming up of our court system. So there
are some issues there.
There are aspects of this legislation I’m happy to see, including
zero tolerance for any presence of marijuana for drivers in the
graduated licensing program. Completely supportive of that. We all know
that this makes sense with alcohol, so why wouldn’t it make sense with
marijuana or any drug, for that matter?
I’m sure members will recall the story of Ross Rebagliati. After
winning the gold medal in snowboarding, he tested positive for marijuana
and swore that he was just sitting around while other people were
smoking it. That can happen. That can happen.
I hope that nobody loses their licence because trace amounts were
detected from being exposed to secondhand smoke. It’s not like, as the
member before this morning said, when you’re sitting in the back seat of
a car having a beer. That doesn’t affect the driver,
whereas somebody
smoking a joint in the back seat will.
How will drug experts recognize this? If a designated driver goes
to a party and smells like marijuana smoke because their friends have to
use it, what happens to them? Do they receive a criminal record? What
will it do to their driving record? Will they be able to get into the
United States? So these are some serious, serious questions that we have
to ask.
I’m certainly not suggesting in any way, shape or form that we
give anybody a free pass or a free ride around impairment. But we have
to make sure that the punishment fits the crime, especially if the
threshold is subjective.
[2:00 p.m.]
There are lots of questions. I look forward to the committee stage
of this, because I know I’m going to be participating in it. But as I
mentioned before, I am going to be supporting this bill and thank the
minister for his efforts as we move forward with this.
R. Sultan: I’m glad to contribute my meagre knowledge on the subject of
cannabis to this erudite debate. I will confess up front that my
knowledge of cannabis and motor vehicles relates to a Cheech and Chong
movie I saw about 30 years ago, as a van which seemed to be fabricated
from marijuana plants was driving across the border between Mexico and
California and somehow caught on fire, which, in turn, caused the entire
border guard staff to become, shall we say, impacted.
Anyways, it was a great flick. But that was the extent of my
sophisticated knowledge on the subject on which I’m asked now to pass
laws which will perhaps result in criminal records, which will create
great complications for our citizens. So I would caution that we should
tread lightly before we put the fate of the records of so many citizens
in the hands of somebody whose knowledge is limited to Cheech and
Chong.
With that precaution, let me just point out some issues I see in
section 3 of the bill. If I could interpret the remarks of my colleague
who proceeded me,
section 3(c)(2.1)(
b) suggests, to quote the law, that
the peace officer “has reasonable grounds to believe, as a result of the
analysis, that the driver has a prescribed drug in his or her body….” I
presume that is, in fact, what the preceding member referred to as a
zero-tolerance rule.
At least, that’s how I would interpret it. Nada. Nothing. One
molecule — that will do it. Perhaps that is necessary when our knowledge
of the true impact of this substance in the human body is based more on
Hollywood movies than upon science.
I also see, moving along to subsection 5(d)(a.1) of the bill, that
the “analysis of the blood of a person” — so suspected, I presume, I’d
interject — “within 2 hours after ceasing to operate a motor vehicle, a
blood drug concentration equal to…,” etc.
In other words, we begin now to arbitrarily set measurement limits
— but, I rather suspect, on the basis of somewhat sketchy science. Let
me also concede to the Solicitor General, who has brought forward this
bill, that he’s been given a very awkward assignment indeed. Knowing how
conscientious and competent he is, I regret that he’s been thrown this
curveball from way out there in Ottawa, saying: “Get ready. It’s coming.
We need some sort of a law on the books.”
This is probably the best the most erudite legal scholar in the
world could have come up with in the time in which he has had to
operate. Indeed, perhaps this is about as good a law as the best and
most thoughtful Legislative Assembly could come up with in the very
limited time available. But that does not excuse these rather arbitrary
time limits under which we are operating, on a subject of such deep
importance. I refer to all the ways in which we can contrive to run
over, run down and even kill one another on the highways.
[2:05 p.m.]
I’m indebted to my colleague from the Green Party pointing out
that we are talking about a substance called THC. Reference to my iPhone
educates me to the full word: tetrahydrocannabinol. This is all about
cannabis. We also seem to be quite capable, in this province, of running
over one another through the mere use of that iPhone through distracted
driving.
Alcohol. Again consulting the dictionary, we see that about 65
people a year are killed through inebriated driving in British Columbia,
roughly one a week. We kill about one person a week through drunk
driving, impaired driving through prescription drugs and a combination
thereof. We have not yet to enjoy the experiments with driverless
automobiles, but those vehicles have been able to knock off a few people
as well, although we are assured that, in the long run, they will cut
the accident rate by about 80 percent. Actually, I have faith that they
will.
As I indicated at the outset, I think our Solicitor General has
been forced to take on this complex assignment based upon some political
promises made in another jurisdiction, the federal government in Ottawa,
which seems bound and determined to make the distribution and
consumption of cannabis legal, if my reading of the popular press is
accurate, sometime in July — in other words, about ten weeks from now.
Ten weeks from now we are expected to have a fully functioning legal
apparatus for the control and safe conduct of traffic on our streets,
surrounded by the uncertainties I’ve already alluded to.
One of our political leaders referred to all of this not so long
ago as “unfortunate,” and I truly think it is — to be asked, as a junior
government in this confederation, to come forward with a workable regime
that our law enforcement officers, our municipalities and our own
provincial government itself can cope with. It is my observation and my
impression, at least, that the police are not ready and the
municipalities are not ready. Certainly, we in this Legislature are
taking some initial steps, but only initial steps, to get ready. The
bill itself, I’m sure, could stand lots of scrutiny and fine-tuning and
improvement.
Certainly, I would suggest, the U.S. border regime is not ready.
Let me report my recent experience visiting my kids down in Vermont,
driving down, as I usually do, late at night at Christmastime. At a
border station, where usually you drive through with a very casual wave
of the hand, eight Homeland Security guards in full uniform, with full
sidearms, were dealing with one lonely Canadian. I was the only person,
I think, showing up in about an hour.
This is the border regime we are now facing with our friends in
the United States. If we show up and say, “Oh well, I had a few joints,
but don’t worry about it….” Well, I hope they’re not showing up at
midnight at that border station south of Montreal with eight Homeland
Security officers there trying to figure out some way to use those
sidearms. It is chilling, yet we will be exposing people who perhaps do
not have the full benefit of education and advice to these risks as they
attempt to go into the United States, where, as I understand it,
federally, it’s still illegal.
I compliment the Solicitor General for doing his best. I’m sure
few people could do as well in the time that he has had. I also lament
being forced into this situation by a senior government that is asking
us to do almost the impossible, which is to overnight invent a judicial
and enforcement regime which hardly exists notionally, let alone in
detail.
[2:10 p.m.]
Training not yet conducted. Police budgets not yet adjusted.
Goodness knows where the budgeting for all of this is going to sort out.
I will not make any wisecracks about municipal budgets. There’s a lot of
unfinished business with this law. I will go along with my colleagues on
whether we support this flawed piece of legislation reluctantly, as we
really have few alternatives but to embrace it. I think it is very
unfortunate that this Legislature has been forced into a situation with
a ten-week deadline and so many unanswered questions.
Deputy Speaker: Seeing no further speakers, the minister will close the
debate.
Hon. M. Farnworth: I want to take this moment to thank members for participating in
the debate and for raising some important questions, because there is
still a considerable amount of uncertainty. My colleague from West
Vancouver is absolutely correct. This legislation is required because of
decisions being made in Ottawa. We have to have it in place even though
we don’t know yet what the final bill that Ottawa is going to pass will
actually look like. That’s a real problem not just for British Columbia
but for provinces right across the country.
Previous members on both sides have talked about the issue with
police and training. Those are of critical importance. Police chiefs
have said: “We don’t have enough time.” We have made it clear as a
province, in our discussions at the federal-provincial-territorial
tables, that Ottawa is imposing this, and they need to put in place the
funds the provinces need in order to do the training that needs to
happen so that officers are trained and we can get as many trained ahead
of time as is possible. That has started. I am pleased, at this point,
where we are in British Columbia in terms of that training. In fact, I
think we are ahead of many of the provinces, but there is a lot of work
that still needs to be done.
The issue of funding, the issue of training, the issue of
readiness is crucial. We still don’t know the date of when legalization
is actually going to take place. We know that there is an agreement on
Bill C-45 to be out of the Senate by June 7. There may still yet be
amendments to that piece of legislation. We don’t know. But once that
bill is out, the provinces are still going to need time to look at the
bill as it is and the regulations that will flow from that bill and be
able to prepare for legalization.
My expectation is it will be sometime later this summer. It will
not be July 1. I’m hoping it’s later, into September or October. The
later, the better, frankly — the more time we have. But that’s just one
aspect, one part. Then C-46, which is the bill that is in essence what
is giving life to us to deal with this piece of legislation…. We still
don’t know exactly when that will be out of the Senate, and we still
don’t know exactly what the technology is going to be.
There are existing rules in place — those will continue to be in
place — around drug-impaired driving and alcohol-impaired driving.
They’re still there, but the reality is that when the federal government
indicates to us that there is new technology that’s coming…. The sooner
we know what it is, the better and the more we’ll be able to make sure
that when legalization does happen, we are as ready as is
possible.
I also want to quickly touch on, before I finish my remarks…. We
can get into the nuts and bolts of the legislation a lot more during
committee stage. I think it is one of the great, little-known issues
that we are going to be facing. In this whole discussion around
cannabis, it’s amazing how many issues it has brought to the surface
that need to be addressed.
What the member described as his experience at the border in
Vermont is, I fear, going to have a significant impact, particularly
here in British Columbia. Cannabis will be legal in B.C., and it will be
legal in Washington state and Oregon and California. People are going to
naturally assume, on either side of the border, that they can cross back
and forth because it’s legal in each jurisdiction.
[2:15 p.m.]
The reality is it will not be legal at that federal border
crossing, the U.S.-Canada border crossing. It is U.S. federal
jurisdiction on their side, and it will not be legal. They have already
indicated to us — we’ve raised this with the U.S. consular general; it
has been raised at the highest levels in Washington — that they have
absolutely zero interest in dealing with the problems that are going to
arise. They’ve told us that in no uncertain terms.
So you are going to have the potential of ordinary citizens, who
are doing something legal in this country and in this province, crossing
the border and having to answer a question, and if they reply
truthfully, they can be denied access. They potentially could have their
vehicle seized, fines, you name it. And likewise, people coming up from
the United States.
What is it going to mean, for example, if you have a business that
does a lot of work in the U.S., and you have an employee that’s going
down there and, on their own time, they’re doing something, again, that
is perfectly legal in Canada, perfectly legal in Washington state, but
at the border, it’s not?
There are some very important, unanswered questions, in terms of
you as a private individual or you as a business, whether it’s a small
business or a large business. There are some significant issues that we
still are going to have to deal with, and we’re going to have to deal
with them with our largest neighbour next door to us — our largest
trading partner, who has already told us: “We don’t care. It’s not a
priority for us.”
I just want to flag that, because there is going to have to be a
lot of education done around that. I think it’s a little-known
consequence of what is, in fact, taking place with
legalization.
I’ll just leave that there. I wanted to get that on the record,
because I think it’s important. We’re going to have to have some
important discussion on that issue, as a province and as a
country.
I want to thank members from all parties for participating in the
debate. Many of the key questions that they have asked, we will be
addressing in committee stage of the bill.
With that, I move second reading.
Motion approved.
Hon. M. Farnworth: I move the bill be referred to a Committee of the Whole for the
next sitting after today.
Bill 17, Motor Vehicle Amendment Act, 2018, read a second time and
referred to a Committee of the Whole House for consideration at the next
sitting of the House after today.
Hon. M. Farnworth: I call second reading and debate on Bill 29, the Voluntary Blood
Donations Act.
BILL 29 — VOLUNTARY BLOOD
DONATIONS
ACT
Hon. A. Dix: I move second reading of Bill 29, the Voluntary Blood Donations
Act. I think it’s fair to say that this legislation, while it has a
number of provisions, is based on a simple proposition. It prohibits —
subject to certain exemptions, which will be understandable and which
we’ll, no doubt, discuss at committee stage — payment for blood
donations.
I think that Canadians and British Columbians, surely, are proud
of our public health care system. For decades, it has provided care for
people. It’s a treasured national resource. We all know that. I think
there’s a consensus of that in Canada. We understand its value to
us.
Occasionally, when we forget its value, I think it’s useful to
talk to people who are now seniors, who lived in Canada prior to the
advent of our public health care system — and the economic threat to the
health and well-being of ordinary people that came from a system that
was not universal — who did not have the access to services we
have.
A very important part of that, at a practical level, is a publicly
owned and operated blood supply system. Canadian Blood Services is
Canada’s supplier of blood and blood products, including plasma, which
is one of the subjects of our discussion today. It’s a non-profit
corporation. It’s made up of a board appointed by provincial and
territorial Health ministers. The majority of the funding for its
operations comes from provincial governments. Our government, for
example, invests $180 million per year on a system that we all rely on
and benefit from.
[2:20 p.m.]
It’s in our collective interests, it seems to me, to prevent the
blood supply from being threatened or reduced by competition from a
private, for-profit market.
People make donations to help others live. It’s a selfless act
that ordinary people make every day in virtually every community in our
province and in our country — people from Golden, Revelstoke, Kelowna,
Richmond, Abbotsford, Saanich and Surrey every day committing that
selfless act that helps others live. It’s one of the most important
things that binds people together.
I personally, as people may know, have type 1 diabetes. I gave
blood until I was diagnosed with that, and because of that condition, I
can’t give blood. I regret that, although I gave many times before I was
diagnosed in my 20s. But I think it’s that act that brings Canadians
together. They’re coming together in common cause to help one another in
an ordinary way and an extraordinary way.
You can go to a Canadian Blood Services clinic, roll up your
sleeves and provide something invaluable — the gift of life. We all have
that opportunity. Since I can’t, I encourage all of you to take up that
opportunity. It’s why, I think, this legislation is so important. It was
developed to protect our investment — both our personal investment, in
many cases, and our collective investment in Canada’s publicly owned and
operated blood system.
You will know that paid plasma clinics have opened in Saskatchewan
and New Brunswick, and there were attempted openings in Ontario prior to
the introduction and passage of legislation parallel to what we’re doing
today. These clinics have been established by a private, for-profit
company based in Ontario, and the company has expressed interest in
opening a paid plasma clinic in B.C.
There is currently no legislation in B.C. to prevent these clinics
from operating here. Unless B.C. moves ahead with legislation to ban
payment for plasma, private clinics such as those in Saskatchewan and
New Brunswick could be established here in the near future. That will
have consequences for our public health care system and for our publicly
supported and operated blood supply system.
The prospect of paid plasma clinics opening in B.C. is a
significant concern to Canadian Blood Services. Canadian Blood Services
is responsible, as I said, for managing the national blood supply, and
it’s funded by all the provinces and territories in Canada except in the
province of Quebec, which has its own system. Canadian Blood Services
points out that private paid plasma collection competes with CBS for
donors and will negatively impact volunteer donor recruitment. That has
certainly been the case and had an impact on the quality of donor
recruitment in the province of Saskatchewan.
Private paid plasma collection does not contribute to Canada’s
plasma self-sufficiency, since private companies sell plasma on the open
global market to the highest bidder. It’s important to understand that
plasma used for transfusion is something we are self-sufficient in, in
Canada. Some plasma is used for the creation of course, importantly, of
what are essentially pharmaceutical products which we need and import to
Canada.
For these reasons, Alberta, Ontario and Quebec have already
enacted legislation banning payment for the collection of blood and
plasma. The Voluntary Blood Donations Act I am speaking to today in this
House would do the same. The Canadian Blood Services, as operator of the
national blood system, will continue to be the only collector of blood
and plasma in B.C. and, along with the provincial government, is exempt
from the legislation. Those utilizing blood and plasma for health
research are also exempt.
The legislation will protect the voluntary donor base from erosion
due to competition — this is important — and will ensure that plasma
collected in B.C. remains in the Canadian system for use by Canadian
patients and not sold to the highest bidder. The legislation will not,
on the other hand — the obligation is on those that might provide or pay
for services — penalize individuals for receiving payment for blood or
plasma.
Based on information from other jurisdictions, we know…. It’s
immortalized, of course, in song. We know it is often vulnerable,
low-income individuals who are targeted by companies paying for blood or
plasma. These individuals, of course, should not be penalized for their
actions, should that occur contrary to the law.
[2:25 p.m.]
I want to acknowledge the significant role my colleague the
Minister of Mental Health and Addictions, the member for New
Westminster, who introduced in the past private member’s legislation on
this subject, has played in its development.
It’s for all of these reasons why groups such as the Doctors of
B.C., the B.C. Health Coalition, the B.C.
chapter of the Canadian
Hemophilia Society, Bloodwatch, our own health authorities all support
this legislation. It’s because it makes sense, because it protects our
public blood supply. It ensures its safety, but it also ensures its
long-term future, something that’s essential, it seems to me, to our
public health care system. It’s also why, internationally, the banning
of paid blood donations is opposed by the World Health Organization;
organizations like the EU, in terms of policy; the International Red
Cross; and the international Red Crescent Society.
Well all know, because many of us have a memory of these moments
in our history, that the moments that led to the creation of the Krever
inquiry and the Krever commission were some of the most difficult
moments for governments in Canada and for our public health care
system.
Mr. Justice Krever went through a multi-year process, assessed all
of the evidence and made recommendations on which our current system is
based — recommendations that were both farsighted, it seems to me, and
profound. He concluded that blood is a public resource. He concluded
that donors should not be paid. He concluded that sufficient blood
should be collected so that importation from other countries is
unnecessary. He concluded that access to blood and blood products should
be free and universal and that the safety of the blood supply system is
paramount.
This piece of legislation, Bill 29, is consistent with what Mr.
Justice Krever said in the 1990s. It’s consistent with our understanding
of how the blood supply system works. It’s consistent with the
recommendations of Canadian Blood Services. It’s good legislation. It
ensures that we do not run into this problem in British Columbia — that
we ensure a publicly supported blood supply system — and that a public
blood supply system continues into the future.
Thank you very much. I ask all members to support the
legislation.
N. Letnick: Thank you to the Minister of Health for his words. Let me at the
outset say that the opposition will be supporting the bill. However,
through the process of committee stage, we have a number of questions,
concerns, issues, clarifications, maybe even amendments that we might be
proposing to ensure that the act is in the best interest of all British
Columbians, as I’m sure the minister would like to achieve.
We, on the opposition side of the House, support the publicly
funded health care system. Let there be no question on that. We also
support making sure that what we do in this House is something that the
average British Columbian can understand and see the reasons why we came
to our conclusions.
[L. Reid in the chair.]
With that, what I’d like to do for the minister and for those who
are watching — because I’m sure this is of interest to a few people out
there, especially those in the industry — is to articulate some of the
background to this piece of legislation that we believe is important and
also some concerns that I’ll articulate in the second-round debate and
then probably bring forward at the appropriate time during the committee
stage.
We support voluntary donations of both whole blood and plasma.
Government works very closely with Canadian Blood Services and in 2017
funded Canadian Blood Services to the tune of about $180 million. In
Canada, blood use for transfusion is collected solely by the Canadian
Blood Services or by Héma-Québec and only from volunteer
donors.
The safety of Canada’s blood supply is a federal responsibility.
It falls to Health Canada. Health Canada currently has an expert panel
reviewing the entire issue of paid plasma, and the panel’s report is
expected by the end of May.
[2:30 p.m.]
The decision as to whether plasma donors can be compensated rests
solely with the provincial government. For those who don’t know — and I
didn’t know this prior to studying up for this bill — plasma is the pale
yellow liquid component of blood that normally holds the blood cells in
suspension. It makes up about 55 percent of the total volume of the
individual’s blood.
Plasma donation is the process of collecting a donor’s blood,
separating the plasma portion of the blood from the blood cells and then
returning the blood cells to the donor. This process takes about two to
three hours.
Commonly used plasma products include albumin, which is used to
treat fluid loss in burn or trauma patients; immunoglobulins, which are
used to treat or prevent infections or immune disorders; and clotting
factors, which are used for the treatment of hemophilia as well as other
bleeding disorders.
The body can replace plasma in about 24 hours. In Canada, donors
are permitted to donate weekly. This is different from your average
blood donation that I imagine many of us contribute — those that are
able — where we are asked not to donate for about two months between
donations.
The plasma that CBS collects, our provincial and national agency,
only meets about 17 percent of the need for intravenous immunoglobulins
in Canada — only 17 percent. About 70 percent to 80 percent of the
life-saving plasma proteins that are used by Canadians come from foreign
sources, which, in the majority of cases, are from paid United States
donors.
Canadian Blood Services says: “The plasma industry’s experience
over the last three decades shows that drugs made from plasma donated by
paid donors are as safe as those made from plasma donated by volunteer
donors.”
Health Canada says: “Paying people to donate plasma in Canada is
not new. It does not represent a change in policy or practice in Canada.
A company in Winnipeg has been operating safely and paying donors for
plasma for 30 years.”
Any establishment that collects plasma for use in making plasma
products must be licensed by Health Canada. The licence application must
show that its donor screening and testing processes meet the strict
requirements under the law.
For example, before donors are accepted into a plasma donation
program, they must be determined to be eligible to donate. In addition
to a comprehensive questionnaire and interview, donors must be
physically examined for health and disease risk factors.
At the time of every donation, donors are re-interviewed, and
their blood is tested for infectious diseases, including HIV, hepatitis
B and hepatitis C. Before a licence is granted, Health Canada inspects
the establishment to ensure that it is meeting the safety standards set
out under the Food and Drugs Act. The establishment is then inspected
annually to assess that it is following the law.
Health Canada will take compliance and enforcement actions for
establishments that are not meeting these requirements, which could
result in the loss of their licence. Furthermore, all plasma products
are subjected to an additional regulatory review before they are
authorized for distribution in Canada. This regulatory review includes
careful examination of the plasma collection and product manufacturing
processes.
Health Canada’s stringent regulatory oversight serves to
complement the global standards that plasma collectors must adhere to,
as set out by the Plasma Protein Therapeutics Association, or PPTA. As
part of the PPTA’s international quality plasma program certification
criteria, plasma collection facilities must verify that prospective
donors can provide proof of a fixed residential address within a set
proximity to the collection centre and which is checked against a list
of transient temporary residences to exclude donors who may be part of
some higher risk populations.
Potential donors must also give two donations with negative
disease test results before they are considered qualified, and for
donors who do not return for their second donation, the plasma from the
first donation is destroyed.
Health Canada says that there is no evidence that paying plasma
donors compromises the safety or weakens the country’s volunteer blood
donor system. Paying people to donate plasma in Canada has not weakened
Canada’s blood system or the volunteer donor base, and there’s no
evidence that it will. This system is completely voluntary and remains
so.
Evidence has shown that the U.S. and other countries with paid
plasma donation sites have some of the highest voluntary blood donations
in the world. For example, the blood donation rate of 57 to 58
volunteers per 1,000 people in Germany, Austria and the United States,
which have paid donation, is nearly twice Canada’s rate, at 36.6 per
1,000.
In their report to the Saskatchewan Minister of Health, Canadian
Blood Services offers this
summary of their experience in Saskatoon and
Saskatchewan since the opening of a private plasma clinic operated by
Canadian Plasma Resources, or CPR.
[2:35 p.m.]
I bring up Saskatoon and Saskatchewan for the minister. I also
made attempts to contact New Brunswick and Manitoba, who also permit
private paid plasma, but I have not heard any information back from
them. I did get information back regarding Saskatoon. The information
from the Canadian Blood Services in Saskatoon is that donation frequency
has levelled off and remains fairly constant year over year.
“The donor base has increased at this site,” the site in Saskatoon
where the private clinic is, “in the past few months, bringing it to
above the March 2016 donor base numbers. This is due to increased new
donor acquisition year over year. The lapsing results are only visible
after 12 months. Since March is the first month we are able to compare
lapsed donor information, it is still too early to form any definitive
conclusions. We will need to continue to monitor this program.”
The last bit they say in the introduction
is:
“The 17- to 24-year-old segment is experiencing a double-digit
decline at the Saskatoon site. This could be attributed to CPR,” or
private facility, “and the demographic they are targeting for
recruitment. This trend is not reflective of national and regional
trends for the same age cohort.”
The report goes on to say that, specifically, CBS reports a 35.8
percent increase in new donors April to March 2017 over 2016 for
Saskatoon, where the new CPR site is located, and a 15.7 percent
increase for the rest of Saskatchewan.
The report concludes that “further analysis on the first…year of
CPR operations does not seem to show any clear indications of CPR
impacting Saskatoon’s collections performance. New donor numbers
continue to increase month over month, and collections are remaining
steady, with a slight increase year over year. Evidence does point to a
drop in involvement of the critical 17 to
24-year-old…segment.”
“Taken together, the brand confusion between Canadian Blood Services
and Canadian Plasma Resources and the early indicators of performance
degradation within the 17-to-24 age bracket suggests the need for
heightened vigilance on this matter. Further analysis will continue to
be conducted on a quarterly basis.”
From the Saskatoon Star Phoenix , Jonathan Charlton
published an
article in 2017, in April, that says:
“It’s essential there is enough plasma product for Canadians. A
disruption at the U.S. border would be tragic for people who rely on
plasma products. The Krever inquiry indicated support for paid plasma
donation in certain circumstances. Justice Horace Krever, head of the
commission of inquiry, recommended ‘significant efforts be made to
ensure that blood components and blood products used in Canada are made
from the blood and plasma collected from unpaid donors.’ He also said a
strong effort should be made to achieve self-sufficiency in plasma
within a limited period.
“Krever expected self-sufficiency for the Canadian system to be
easier than in the past since most people with hemophilia no longer use
plasma-derived products. However, that hasn’t happened. Manufacturers of
some special blood products rely on a small number of donors, so ‘it may
be necessary to offer compensation to these persons for their time and
effort in order to attract a sufficient number of donors,’ Krever
wrote.”
CBC news in February of 2016 reported that the CEO of Canadian
Plasma Resources says: “Plasma donations take three times longer than
regular blood donations, making a small donation important. In our case,
all cells are returned to the donor,” he said. “Only plasma, which is
water, and proteins are kept. We do a saline infusion at the last cycle
of the process so the donor doesn’t feel dehydrated.”
Health Canada says: “If Canadians didn’t have access to products
that are currently made from plasma from paid donors, the health and
lives of thousands of Canadians who rely on their life-saving properties
could be at risk.”
The International Federation of Red Cross Societies, whose global
framework for action states very clearly: “Paid donors are vulnerable to
exploitation and commercialization of the human body as they…become paid
blood donors due to economic difficulties.” “The need to protect their
income they receive…compromises issues of honesty in the donor
interview, and they are unlikely to reveal reasons why they are
unsuitable to donate blood.”
[2:40 p.m.]
In their policy statement on paid plasma donations, the Canadian
Hemophilia Society says:
“Canada, U.S. and other developed countries are identical in being
self-sufficient in fresh blood components from non-paid donors and
almost totally reliant for the supply of plasma-derived products on U.S.
paid donors.
“There are currently no serious strategies in place around the world
to reverse this situation. The demand for life-saving plasma-derived
products is increasing faster than the growth in the whole blood
collection — and, therefore, recovered plasma. Not-for-profit blood
establishments do not consider it economical to recruit non-paid donors
for a self-sufficient supply of plasma for plasma-derived products. They
choose to rely on the highly efficient for-profit global plasma
collection and fractionation industries. Therefore, the reliance on
source plasma from paid donors will only increase.
“In the absence of any realistic strategy to significantly increase
the Canadian contribution to the world supply from non-paid donations,
and when Canada relies almost entirely on paid donors from the U.S. for
life-saving plasma-derived products, it is not defensible to reject paid
donor practices on ethical grounds.”
We will support the legislation because we believe it’s the right
thing to do, given all these different opinions on both sides of the
issue. But we do have serious questions about the government’s plan to
make sure that we have a sustainable, viable, publicly funded collection
system for plasma in Canada, particularly in British Columbia. I think
it’s unconscionable that we should continue to rely on the United States
to supply our plasma for use in this country.
We will be posing some very difficult questions to the minister at
the time of committee stage to see what the minister’s plan is — that
the government currently funds, as he said, the majority of the needs
for Canadian Blood Services and what their plans are to make sure that
we have a path forward to ensure we have a strong, publicly funded
health care system with a strong, publicly funded plasma collection
system in this province.
S. Furstenau: I rise to speak to Bill 29, Voluntary Blood Donations
Act.
This Voluntary Blood Donations Act makes it an offence to offer
payment for donating blood or any of its components. Currently the
Canadian Blood Services, or CBS, is responsible for blood-related
services in most of Canada as a non-profit. It has not historically
offered remuneration for donations.
It is important to note that CBS has been identified in this bill
as exempt from the prohibition of compensating donors. This legislation
creates a pre-emptive move that guarantees that CBS will remain the
primary blood provider in British Columbia.
I agree with the minister that CBS is the proper agency for
collecting and managing our blood supply. What I think must be
highlighted, however, is that we have a long way to go for CBS to have a
truly resilient blood and plasma supply that will be able to fully meet
the needs of our citizens. And this means that our investment into CBS
has to increase so that the infrastructure and capacity of this agency
can be brought to a place where it does produce a resilient blood and
plasma supply for all of our citizens.
Right now Canada is only self-sufficient in approximately 17
percent of its plasma production. The majority of plasma products are
imported from the United States, where most of the donors for plasma are
paid.
Safety is not a concern here. Access is. Many patients depend on
these products not just for their quality of life but for their very
survival.
CBS has stated that it is committed to increasing our plasma
self-sufficiency. However, I am concerned that this legislation
addresses one aspect of our blood and plasma collection system without
turning attention to the greater need of how B.C. will be building a
sustainable, self-reliant blood and plasma collection and distribution
system.
Health Canada intends to publish an expert report on public and
private blood providers in the coming weeks. It will be essential that
we consider the data and recommendations provided by this report in
moving forward.
Ultimately, we need to agree on the overarching goal, and it’s
essential that we move to a far more resilient blood service and supply
in B.C. and Canada and that we protect the needs of our citizens who
depend on blood and plasma for their survival.
[2:45 p.m.]
Relying on importing blood products makes us vulnerable in the
face of a crisis, in which other countries may limit the sale of their
blood and plasma products in order to fulfil their own citizens’
needs.
Similarly, we need to facilitate the development of CBS’s
infrastructure by working together with other provinces to provide
additional funding. The plan must be long term and focused on providing
accessible products to the patients that have the greatest needs. In the
long run, this endeavour would be cost-efficient, as we would no longer
have to rely on buying plasma products on the international
market.
I eagerly anticipate the steps that this government will take to
build and strengthen CBS so that we can ensure that patients across
British Columbia have the reliable access to blood, plasma and plasma
products that they need to survive.
Deputy Speaker: Seeing no further speakers, the minister closes debate.
Hon. A. Dix: First of all, thank you very much to both the Health critic for
the Third Party and the opposition Health critic for their contributions
and their support of the legislation.
I think this is an important step, but as they rightly note, it’s
not the only step. We have continuing work to do to improve the services
provided by Canadian Blood Services, of which the B.C. government and
all other provincial governments are partners. And we fully intend to
make that work happen in the coming days, weeks, months and
years.
What this legislation does is it essentially, fundamentally,
protects the public blood supply system in Canada and the public health
care system in Canada. I think it’s necessary legislation — not
sufficient to answer all of the questions but necessary legislation —
supported broadly by British Columbians, from the Doctors of B.C. to
Bloodwatch to the B.C. Health Coalition.
I ask the members to support this legislation.
Deputy Speaker: Hon. Members, the question is second reading of Bill 29, the
Voluntary Blood Donations Act.
Motion approved.
Hon. A. Dix: I move that the bill be placed on the orders of the day for
committee stage at the next sitting of the House after today.
Bill 29, Voluntary Blood Donations Act, read a second time and
referred to a Committee of the Whole House for consideration at the next
sitting of the House after today.
Hon. C. James: I’ll call second reading of Bill 25, the Real Estate Development
Marketing Amendment Act.
BILL 25 — REAL ESTATE DEVELOPMENT
MARKETING AMENDMENT
ACT, 2018
Hon. C. James: I move that the bill now be read a second time.
Our government made a commitment, when we were putting together
our first full budget, to put people at the centre of every decision we
make. That’s the reason that when you take a look at the priorities in
Budget 2018, two of those key priorities are related to specific issues
— affordability issues and economic issues — that have been raised by
British Columbians for years in this province. The focus was child care
and housing. This bill speaks to one of those housing measures as part
of our 30-point comprehensive housing plan.
There is no question that the housing issue in British Columbia is
a crisis. There is no question when you talk to individuals and families
and seniors. I’m sure every member in this Legislature has heard the
heartbreaking stories of people who can’t find affordable places to
live, who can’t find safe places to live. Every member went through the
election, almost a year ago now, and had the opportunity to be out in
their communities, door-knocking and talking to individuals. And I have
to say those were some of the toughest stories that I certainly heard
when I went door-knocking, where individuals….
In fact, I remember climbing up a flight of stairs, 3½ storeys, to
the top of a house where two young women who were in nursing school were
living. I knocked on the door, and we had a conversation about the
issues in the election. Then they told me about how dangerous the
staircase was, which was pretty obvious coming up; the deficiencies in
the suite they had; and the challenges they were facing — basically, the
difficult, almost unsafe conditions they were living in.
They weren’t going to say anything because they couldn’t find
another place to live. They were terrified that if they lost this place,
they were going to be in a situation where…. They were going to school
to be able to train for careers that we need in British Columbia, and
they weren’t able to even raise the concerns about their place because
they were so worried about what was going to happen.
A year before I had two seniors in my office who had been sleeping
in their cars. That’s the kind of situation and the kind of crisis that
we’re facing when we look at the issues in housing here in British
Columbia. We know that vacancy rates are at historic lows. Rental rates
are unaffordable.
[2:50 p.m.]
The housing crisis has to be addressed. It continues to be one of
the biggest issues that is raised by businesses across British Columbia.
When we talk about growing this long-term sustainable economy, we can’t
do that if businesses can’t recruit and retain employees because they
can’t afford housing in British Columbia. And we hear that from
businesses in every corner of our province. This is not simply a Lower
Mainland issue. This is a provincial issue.
I have always said that we’re not going to address housing
affordability overnight. There isn’t one simple tool that’s going to
address the crisis that has been left for a number of years. It is going
to take a suite of measures. That’s really what we’re bringing
forward.
I recognize there’s certainly been a lot of discussion about
housing in British Columbia over the last number of months, and I expect
that’s going to continue. I understand that not everyone is happy with
change, that there are some people who have benefited quite well from
the status quo and who have done quite well from the status quo. But it
is our responsibility as government, I believe — our responsibility to
the people of British Columbia and our responsibility to a long-term,
sustainable plan for our province — that we address the housing
affordability crisis in British Columbia.
I’m incredibly proud of the actions that our government has taken,
incredibly proud of the work we are doing. Not to simply sit back and
say: “Well, we’ll wait and watch. We’ll see how this one tool works.” We
actually put together a suite of measures, a 30-point plan, to address
housing affordability in this province.
Government doesn’t control all of the tools when it comes to
housing. We recognize that there are interest rates that impact housing
markets. There are changes to mortgage rules that impact housing
markets. But just because we don’t control all of the tools doesn’t mean
that we shouldn’t, as a government, get started in addressing this
issue. That is our responsibility.
In bringing forward Bill 25, we are continuing, as part of our
30-point plan, in addressing that crisis. This bill deals with
speculative housing demand by closing loopholes in contract assignments
in the condo presale market and cracking down on tax fraud. As many of
you in this House know already, the Real Estate Development Marketing
Act applies to developers who market new strata lots and other types of
development units in our province, and that includes presale
condos.
The act imposes consumer protection requirements on developers
before they begin marketing. For example, there are some things that are
required right now. Purchasers are entitled to receive disclosures about
the strata lot they are purchasing. The amendments in this bill will
require a developer to expand those requirements. It will require a
developer to consent to the assignment of a strata lot contract. It will
require the developer to collect comprehensive information about the
assignment before providing that consent, and it will also require that
that information collected gets transferred to the property transfer tax
administrator.
I think many British Columbians would be surprised to know that
that information isn’t already collected. I certainly was. I will say
that I think many of us believed that there was information there that
could be acted on. In fact, what we have learned is that that
information has not been collected. So this is the first step in making
sure, if further action is needed, that we take further
action.
Developers will also be required to include terms in their
contracts to inform purchasers of the new requirements, of the new
reporting requirements. And as I said, right now comprehensive
information on strata lot contract assignments isn’t available and isn’t
collected. The assignment information that will be collected and
reported to the administrator will be shared with the Canada Revenue
Agency and the ministry’s revenue division to be able to support federal
and provincial tax compliance and to make sure that people pay their
fair share of taxes.
Right now there isn’t tracking to determine that people who buy….
Often it’s referred to as condo flipping. That’s what you’ll hear people
talking about when we’re talking about presale condos. They’ll flip a
condo. It’ll be flipped two or three times before anybody actually lives
in it, and that value is going up each time it’s flipped. Well, the
individual has a responsibility to pay tax on that increased value.
Whether that’s happening or not right now, without the information,
isn’t clear. This will provide us with that assignment information to be
able to make sure that people do what people expect in British Columbia:
pay their fair share of taxes.
[2:55 p.m.]
The superintendent of real estate will enforce the developers’ new
collection and reporting requirements just in the same manner as they
deal with other requirements that are imposed under the act. The
superintendent also may investigate, may hold hearings and may order
non-compliant developers to actually cease marketing to comply or to pay
the costs or an administrative fine.
There are also some consequential amendments to the Income Tax Act
and the Property Transfer Tax Act that allow this information collected
under these statutes to be shared with the superintendent for the
purpose of administering and enforcing the Real Estate Development
Marketing Act.
These amendments will also strengthen the superintendent’s
enforcement tools and make some minor corrections. Investigations, in
these amendments, are also streamlined by allowing the superintendent to
appoint staff as investigators based on job titles and responsibility.
Investigators’ authority to demand information will be expanded to
include any person who is reasonably likely to have any relevant
information.
As well, I think it’s important to look at deterrence for any bad
behaviour. To prevent developers from simply treating fines as a cost of
doing business, maximum fines for administrative penalties and offences
will be increased in these amendments. Penalties and offences will be
increased, which is consistent with the recent increases that have been
made under the Real Estate Services Act.
Finally, minor corrections are made to make it an offence to fail
to comply with the requirements for consolidated disclosure statements,
and clarifies that those disclosure statement requirements are the
responsibility of the developer.
Together, these amendments make the condo market fairer for
British Columbians. They are the first step in making sure that people
who flip presale condos are paying their fair share of taxes. They’re a
first step to stop speculators in the presale condo market from driving
up prices for British Columbians.
By tracking presales and ensuring appropriate enforcement, we’ll
crack down on tax evasion. We’ll also have the information, then, if
further action needs to be done, to be able to move ahead on further
action to address this issue.
I look forward to the discussion on second reading, and I’ll take
my place.
S. Bond: Thank you to the minister for her remarks, both here and at the
introduction of the bill. I’m going to make some comments. Obviously,
we’re going to work our way through this in committee stage, but I do
want to thank the minister’s staff for making themselves available for a
briefing. That’s always appreciated, and this minister is very helpful
in terms of providing those kinds of opportunities for members of the
opposition, and I’m sure for the Green Party as well. We appreciate
that.
I think the minister has outlined an important issue that, as she
reflects on, is important to every member of this House. Housing and
affordability were critical issues during the election campaign and have
been since that period of time. I think that, generally, people would be
supportive of Bill 25 — when you think about the fact that this makes
sure that when a gain is made on the assignment of a presale contract,
the appropriate taxes are collected. I think most British Columbians
would assume that’s happening, and they want to be sure that that
happens.
I think this is about making sure that that practice is in place
and it is being strengthened. As the minister pointed out, the bill will
require real estate developers to collect and report information on
presale condo purchases and sales — they’re called assignments, for
those of you who may not know what that’s about — to make sure people
are paying the proper taxes when that contract is
transferred.
Currently, if a seller assigns a contract to another person at a
personal gain, they are supposed to be paying capital gains taxes if
they make a profit. But as this bill points out, without adequate
reporting requirements, those taxes can be and probably often are
avoided. I think that we will have…. I’ll be interested in hearing from
my colleague the Leader of the Third Party, his perspective, but I’m
assuming we would all agree that we need to actually close that
opportunity and make sure that those taxes are being
collected.
The amendments in Bill 25 will mandate developers to include terms
in their contracts to inform buyers of the new collection and reporting
requirement. So there will be, in essence, informed consent.
[3:00 p.m.]
People will actually need to…. They will be made aware, and they
will actually make a decision about agreeing to that particular
reporting requirement. The information will be reported to the
provincial administrator — as the minister has pointed out, designated
under the Property Transfer Tax Act — and information will be collected.
Certainly, private information will not be publicly shared.
One of the issues that we certainly will have some discussion
about is that Bill 25 also raises the cap on administrative penalties on
developers, and they are significant increases. We see the caps moving
from $50,000 to $500,000 for corporations and from $25,000 to $250,000
for individuals. The amount developers would have to pay if they are
convicted of a violation of the act would also be raised. In fact, it is
a very significant increase, again — obviously a deterrent is, I would
assume, the minister’s intention — from $100,000 to $1.25 million for
the first conviction.
As you can imagine, we certainly see that that is a 1,000 percent
increase in administrative monetary penalties and fines. I think that
there is some room for discussion about a $1 million fine for
incorrectly filing paperwork. It may seem excessive to some. I think
there’s some room for discussion about that. We’ll certainly be asking
those kinds of questions during committee stage.
Once again, we see that the bill allows cabinet to make regulatory
changes. They will be able to prescribe the information that must be
collected from developers. The term at which it is responsible will
require consent from the developer for an assignment to occur. As I have
said and will continue to say every time a bill comes before the House,
and was certainly the recipient of much criticism from the other side of
the House every single time we brought a bill forward that said there
would be reg-making powers and authorities….
I don’t think a bill has come through this House under the current
government that allows cabinet to add some sort of regulation. This is a
significant issue. When you look at what the bill says, it says that
cabinet will decide the information that must be collected from
developers. There’s a whole range of thinking that could possibly take
place at the cabinet table with that kind of regulatory power. From our
perspective, we’re certainly going to ask some questions about why that
reg-making authority is necessary and what the minister would anticipate
cabinet would be thinking about in terms of adding additional regulation
and, certainly, information that’s corrected.
The purchaser of a presale condo must have confidence that they
are paying fair market value for a property. We must ensure that
artificial price escalation does not occur and enrich a very small
minority at the expense of British Columbians who want to buy a home.
Again, I think that’s something that all of us feel very strongly about.
An open market only happens when there is a level playing field between
those selling a property and those making a purchase. Confidence in the
market is gained only when the rules apply to everyone. So from that
perspective, we want to make sure that the rights and obligations of
both the buyers and the sellers are properly respected in
legislation.
With that being said, the proposed legislation is intended to
ensure that appropriate taxes are paid when a gain is made through the
assignment of a presale contract. We need to know if the measures
contained in this bill will be effective and if they’re headed in the
right direction. During the bill debate, we certainly will be asking the
minister, during committee stage, if she has a complete picture of the
number of assignments that this legislation may address. In other words,
we need to have the whole picture in front of us to make sure we’re
taking the right steps.
We also need to know if the obligations we impose on developers
and purchasers are reasonable and sound. To that extent, does the
government have an estimate of how much revenue will be generated
through the proper application of capital gains tax? Was there a
conversation with the industry? How do they feel about this? Is there a
sense of what that gap is? How many people are avoiding paying those
taxes? Those are all important follow-up questions. Again, there will be
some conversation about the type of information that’s collected and
what it will be utilized for.
[3:05 p.m.]
One of the things I wanted to just contemplate for a moment was
the fact that when you read the description that was provided by the
government when they released the news release about this bill, talking
about bold steps to fix the housing crisis…. One of the lines in the
release that actually was quite surprising to me…. I understand the
minister has laid out that this is a series of things, and this is
another step in the government’s agenda.
When we stop and think about what this bill does, and when the
sentence in the press release says, “We are making it fairer for people
who want to buy a condo by making sure those who flip presale condos are
paying their fair share….” Wouldn’t one want to assume that what we
really want to try to do is disincent people from actually flipping
condos? It’s certainly been identified as a significant issue. One of
the things that are not reflected in this legislation are the kinds of
disincentives or prohibitions — actually looking at how we manage to try
to disincent people who seek to profit by not just paying appropriate
taxes but with even the concept of condo flipping.
From my perspective, when we think about this, we assume people….
At least, the press release assumes people are going to flip condos. So
let’s make sure we get the taxes out of them. What we really need to be
thinking about are steps that say: “That’s not the way we want this
marketplace to work in British Columbia.” So are there things that could
have been or should have been included in this bill that would have
looked at how we could disincent people from flipping condos in the
first place?
Generally, we agree. If they’re going to flip, we want their tax
revenue. But the key point is: how can we disincent people? How do we
look at far more rigorous controls in terms of how condo flipping is
taking place in the province?
We will be asking the minister, during committee stage, about some
of those features. Did she contemplate what else could have been added
to this bill? When you look at the information that’s collected, are
there ways to help disincent people from contemplating purchasing three
or four or five units and then flipping them?
This is about tax collection. We agree that that is probably an
important gap to close.
We also want to…. When we look at the proper obligations that are
included in this bill…. The proposed changes to the Real Estate
Development Marketing Act will require real estate developers to collect
and report information and include those terms in their contracts. To
enforce these requirements, the government is imposing stiff penalties
to developers if these obligations are not met.
Let’s look at compliance. In order to be compliant, developers are
being asked to collect information on the basis that assignors and
assignees are providing true and accurate information. For those
attempting to skirt the rules by providing false or inaccurate
information, I see no provision in this bill that would prevent or
penalize these types of offences.
In fairness to those required to collect the information, we
certainly want to ask the minister during committee stage: what measures
are being taken to prevent a situation where a developer attempts to
collect information in good faith and could be held responsible for
false or inaccurate information that is provided by the assignors and
the assignees? In fact, they have done their due diligence, and they
have done their work in good faith.
We’re going to ask the government whether they assume that
developers are in a position to verify all of the information that is
provided to them. Those are simply important checks and balances that we
think should be considered when we’re looking at the kinds of fines that
developers could potentially face. We want to be sure that should the
minister be looking at this process, is there consideration for due
diligence and good faith before the developer is fined at fairly
significant fine levels?
In conclusion, I appreciate the opportunity to make some initial
comments. We do want to ensure that the purchaser of a presale condo, if
they achieve a gain, in fact is paying taxes. We think that is very
important. We also want to make sure that the playing field is level and
that our developers engaged in having to collect that information are
not unfairly penalized.
[3:10 p.m.]
Generally speaking, we think there is some merit. Our primary
concern is that this bill is looking at making sure that we collect
taxes from condo flippers. In fact, we need to be looking at significant
initiatives that will actually disincent people from the practice of
condo flipping in the first place. The minister has said this is one
step and one tool in the toolbox. We certainly look forward to further
discussions about how that might be accomplished in British
Columbia.
A. Weaver: I rise to take my place in second reading on Bill 25, Real Estate
Development Marketing Amendment Act. This bill amends the Real Estate
Development Marketing Act. It requires developers to collect and store
information on presale condo assignments, which will enable the
government to track presales and to tackle tax evasion.
To start, I wish to thank the minister for bringing in such
legislation. It is timely, and it addresses a very important issue.
Also, to the member for Prince George–Valemount, I appreciated her
careful analysis of the bill and look forward to her questioning at
committee stage, where I, too, share some of the concerns she raised.
Overall, my colleagues and I in the Green caucus down here do support
this bill and the intentions.
I’ve heard many a story from British Columbians frustrated with
watching their condos or townhouses in their developments being sold
multiple times without people actually moving in, questioning who is
actually buying and who is actually selling and, in fact, raising the
question as to whether taxes are being collected during the process. But
more importantly, asking the question: how is this allowed in the
province of British Columbia?
While this bill amends the Real Estate Development Marketing Act
and makes a number of changes, it doesn’t, as the member for Prince
George–Valemount said, actually get to the fundamental essence of why
people are flipping and how we put in place measures to disincentivize
that flipping. One of the things we could talk about — I won’t now but
perhaps in future bills brought forward — is the introduction of
something like a flipping tax, a tax that actually targets people who
are buying and selling on a rapid time frame with no intention of
actually moving in.
We could talk about the potential problems that we see in British
Columbia where certain developments are marketed offshore at prices that
are below what you could buy them for onshore. In fact, I’ve got stories
and articles on properties that are marketed offshore something to the
tune of 20 percent below the price you could get for them
here.
The purpose to do so, of course, is that you could get lots of
mass presales done all at once and then these…. Who knows who ends up?
They could very quickly and very rapidly be flipped multiple times for a
short-term gain, and only if the person doing the flipping actually
decides to declare, in Canadian income, that this is a capital gains
would they actually pay tax.
The bill requires real estate developers to collect and report
information on presale condo assignments. Developers now will have to
include terms in their contracts to inform buyers of new collection and
reporting requirements. The information will be reported to the
provincial administrator designated under the property transfer tax, and
information will be shared with the federal government to enable
collection of capital gains. Increased administrative penalties and
offences are also being incorporated in this bill.
This is actually one of several bills that the government has
brought forward since the fall which is designed to get Revenue Canada,
CRA, more information on which they could actually enforce existing
legislation. So I do thank and commend the minister for bringing in yet
another piece of legislation that ensures that information is present
for CRA to actually get taxes when taxes are owed.
Most of the bill is contained in a major section, which is
section
4. It creates a new component of the act with provisions for the
requirements of developers. That will be the subject of the most
extensive canvassing, I suspect, during the committee stage.
I’ve gone over a bunch of the media’s reporting on this to see
what reaction we got from various stakeholders. It’s interesting that….
To say this is uncontentious would be a very fair statement. A diverse
number of business leaders as well as developers have stepped in. For
example, Anne McMullin, as we know, the CEO of the Urban Development
Institute, an institute that represents a collective of developers,
particularly in the Vancouver region — or she represents, at
least.
[3:15 p.m.]
She said her real estate lobby group supports the measures that
are brought forward by the minister, although in fact, she characterized
this as a small problem — 3 percent. I would argue that we might not
know what the percentage is if we’re not collecting the data, so I would
suggest that that would be an estimate. That was reported in the new
Vancouver Star , the Toronto Star version of the paper
that’s emerging in Vancouver.
She says the following: “We had been talking about this before the
budget. If you really want to address speculation, this is where you had
to address it.” That’s a pretty strong statement — in fact, endorsement
— for the legislation here.
Another in a Castanet
article coming out of the Okanagan. Cameron
Muir, who’s a chief economist of the B.C. Real Estate Association, also
said that compiling data to track presale condominium sales is a long
overdue move — again, some high praise for this bill from a relatively
well-connected individual in this particular industry.
Again, there’s Steve Saretsky. He’s quoted in the Vancouver
Sun . He’s a Vancouver real estate agent who suggests it would
bring more transparency to that part of the market, which currently
lacks it.
Another Vancouver realtor, a fellow called Rick Clarke, in the
same Vancouver Sun article, argued that they should do this. “A
lot of people are not reporting and not paying tax and making big
capital gains.” He further went on to say that there’s “a select group
of agents” that have tight relationships with developers who rely on
them for being able to sell chunks of presale condo units, describing
one “known for just having signed 51 contracts in a
half-hour.”
This is a very fine piece of legislation designed to provide
government and, in particular, taxation agencies information in which to
ensure that existing taxation laws are enforced. It’s very timely,
particularly in light of some of the more nefarious, almost, incidences
that are coming to light from investigative reporting by such
journalists as Kathy Tomlinson in the Globe and Mail , who
highlights some of the oddities that are happening in certain segments
in the Vancouver real estate market.
One thing I would caution, though, is that as we continue to take
steps to address what could only be described as an out-of-control real
estate sector or housing market in Metro Vancouver, we be careful not to
hit this whole province with that same sledgehammer that’s hitting there
in Vancouver.
For example, there’s no question that this is important
information that needs to be shared across the province, so implementing
this from north to south, east to west is not a big deal. But there are
other issues where previous governments, for example, brought in
measures targeted specifically on limiting dual agencies.
That was a direct response to problems that were out of control in
Vancouver, but it had unforeseen consequences in rural parts of British
Columbia, where you may have very small offices or you may have one
broker in the whole town now facing strife and troubles, not knowing how
to actually represent clients, both buyers and sellers, when there’s not
the capacity.
As we move forward in dealing with these issues in the housing
market, it’s important to recognize that not always does one size fit
all. In this particular case, I think it’s clear that reporting is a
good thing. I think that it’s critical that people pay taxes when they
should pay taxes. As we move forward, let’s hope that we start to look
even more closely at the concept of flipping and discouraging that
through means possible.
Again, I thank the minister for introducing this bill. We are
proud to support this bill. And I thank the member for Prince
George–Valemount, who brought in very fine comments that we’ll look
forward to seeing explored further in committee stage.
D. Barnett: I would like to begin my comments by providing a brief description
of the legislation. Following that, I, too, would like to outline the
objectives, as the official opposition, that will ensure a fair and open
real estate market, particularly with respect to a fair and open
marketplace. I will then conclude my remarks with my own
concerns.
This bill will require real estate developers to collect and
report information on presale condo purchases and sales, called
assignments, to ensure that people are paying their proper taxes when
the contract is transferred.
Currently, if the seller assigns a contract to another at a
personal gain, they are supposed to pay capital gains taxes if they make
a profit. Without adequate reporting requirements, however, these taxes
are often avoided.
[3:20 p.m.]
The amendments of Bill 25 will mandate developers to include terms
in their contracts to inform buyers of the new collection and reporting
requirements. The information will be reported to the provincial
administrator designated under the Property Transfer Tax Act. This
information will not be publicly shared.
Bill 25 would also raise the cap on administrative penalties on
developers, from $50,000 to $500,000 for corporations and from $25,000
to $250,000 for individuals.
The amount developers would have to pay upon a conviction for a
violation of the act would also be raised, from $100,000 to $1.25
million for first conviction, and from $200,000 to $2.5 million for
subsequent convictions.
The bill would allow cabinet to make regulatory changes
prescribing that information that must be collected from developers, and
the term at which it is responsible, will require consent from the
developer for an assignment to occur. This also includes rules around
filing said assignments information.
As mentioned earlier, we the official opposition are concerned
that law-abiding British Columbians are treated fairly and that everyone
is protected by a free and open marketplace. The purchaser of a presale
condo must have confidence that they are paying fair market value for a
property. We must ensure that artificial price escalation does not occur
and enrich a small minority at the expense of British Columbians who
want to buy a home.
An open market only comes about when there is an even playing
field between those selling a property and those making a purchase.
Confidence in the market is gained only when the rules apply to
everyone. To this end, we must ensure the rights and obligations of both
the buyers and the sellers are properly respected in
legislation.
What appears to be missing in this legislation are prohibitions
against those who seek to profit without paying appropriate taxes. Why
is there no provision in this legislation that would put a tax on condo
flipping? This practice inflates market pressure by speculators and
makes it nearly impossible for young people to enter the real estate
market with astronomical prices.
The question that begs to mind as to how much consultation was
done with the industry in advance of this legislation…. This legislation
stipulates penalties for developers but little to address assignment
deals that jack up the costs of a presale unit before anyone actually
lives in a condo.
I would also like to know if any consideration has been given to
this type of market inflation with respect to the government’s recently
announced review of real estate regulators.
According to an April 18 press release: “The review will examine
the roles and responsibilities of the Real Estate Council of British
Columbia and the office of the superintendent of real estate. Topics
under review include the appropriate structure and composition of the
regulators, how they should communicate, mechanisms for resolving
disputes, and how to divide responsibility for matters such as licensee
qualifications and rule-making.”
The news release goes on to say: “The purpose of this review is to
ensure B.C.’s regulatory system is protecting consumers in the real
estate market. The review will provide recommendations to the Minister
of Finance for consideration by June 15, 2018.”
My question, then, is…. This legislation comes before this House
before the review is complete next June. It would make more sense to me
to address questions about consultation and the protection of consumers
once we know the results of this review. We need to pay close attention,
because the outcome of this process is going to affect how consumers
purchase a home in this province.
I am deeply concerned, because it appears that the government
could end up limiting the rights of consumers to choose. In my opinion,
buyers in this province have every right to select a realtor of their
choice. It doesn’t matter if you are selling or buying a business, a
home, a ranch or a recreational property.
[3:25 p.m.]
Government does not have the right to dictate the way you handle
the sale or purchase of your own property, but we are seeing this with
the proposed rules respecting dual agency. This will require realtors,
especially those in rural regions, from recusing themselves from sales
under certain circumstances.
I recently received a letter from the B.C. Northern Real Estate
Board on this issue. Here is an excerpt from that letter:
“The B.C. Northern Real Estate Board believes strongly that the
proposed ban on limited dual agency will negatively impact the provision
of real estate services to British Columbians living in rural or small
communities. The practice of real estate in the north and north central
area is unique, and imposing rules without considering the uniqueness
will lead to unintended and negative consequences.”
In other words, there may not be a one-size-fits-all
solution for the province as a whole. What measures are contained in
this bill may be applicable to the Lower Mainland but not necessarily in
northern and rural British Columbia.
The B.C. Northern Real Estate Board goes on to say:
“We welcome thoughtful and meaningful reforms that continue to
ensure the public’s interests are protected and that also support
ethical real estate professionals. In the case of dual agency, however,
the process failed to consider the people who will be most affected by a
ban — consumers, communities and licensees in areas outside the Lower
Mainland.
“The board requests a review of the ban to provide decision-makers
with a full assessment of the impacts of the proposed reforms.”
I do hope the government will take this matter into account,
following the conclusion of the review — and how government intends to
respond in kind.
In conclusion, we want to ensure that the purchaser of a presale
condo must have confidence that they are paying fair market value for a
property. We must ensure that artificial price escalation does not occur
and that appropriate taxes are paid in the course of a transaction. To
this end, as legislators, we must ensure that the rights and obligations
of both the buyers and the sellers are properly respected in
legislation.
T. Redies: I rise today to speak on the second reading of Bill 25, Real
Estate Development Marketing Amendment Act, 2018.
As indicated by my learned colleague from Prince George–Valemount,
this bill will put the onus on real estate developers to gather and to
report information to government on presale condo purchase and the sales
assignments.
The premise behind this bill is that it will enable government to
collect the appropriate taxes on any transferred contract and support
greater fairness in the real estate market in B.C. There is validity in
this approach.
As legislators, we want to ensure that there is a robust process
in place to ensure that people pay their fair share of taxes — in this
case, capital gains taxes — if they profit from the sale or assignment
of a strata they purchased. It also makes sense from the perspective of
building trust in the effective and fair operation of the real estate
market in British Columbia for all stakeholders, especially those who
are living and working here and trying to buy a home at a fair price.
The bill, as such, aims to increase confidence that when a gain is made
on the assignment of a presale contract, the appropriate taxes are being
collected.
For clarity, let’s just recall some aspects of the bill, as I
understand it. The bill requires developers to include in their
terms-of-sale contract with the buyer the requirement to gather and
report prescribed information by government to government.
Bill 25 also requires that the contract with the initial buyer
include terms requiring the purchaser to get prior consent of the
developer before assigning any purchase agreement. Further, the
developer cannot provide consent to the assignment without the
appropriate information being obtained. Developers who consent to an
assignment must obtain a copy of the written and signed assignment
contract and must keep the contract in some manner and for some period
of time that has not yet been clearly spelled out in this
bill.
[3:30 p.m.]
Developers must also file all of this information with an
administrator of the government and must file a statement even if the
requirements don’t apply under a transaction, presumably in the
situation where assignments of purchase agreements are
prohibited.
In addition, there are substantial, almost eye-popping increases
in penalties introduced in this bill. Under Bill 25, developers not
conforming to the requirements could pay administrative penalties ten
times the previous amount, to $500,000 for corporations and $250,000 for
individuals.
Further, if a developer is convicted for a violation of the act,
the penalties would be raised from $100,000 to $1.25 million for the
first conviction and from $200,000 to $2.5 million for subsequent
violations.
[R. Chouhan in the chair.]
Finally, the bill allows cabinet substantial leeway to make
regulatory changes pertaining to the act, including, among other
capabilities, to modify the type and scope of the information
required.
There’s no question that we want to see greater affordability in
our housing market and clamp down on situations that are escalating
prices so much that average British Columbians cannot afford to buy
homes where they live and work. It also appears, if the news is correct,
that there have been a number of people who have been benefiting from
legal but arguably unfair trading practices, preventing homes from being
available to the wider public.
I do believe we need to address the housing situation in this
province so there is fairness and people can have confidence that the
marketplace allows all buyers and sellers equal opportunity to
participate. We also need to make sure that more homes are available to
average British Columbians who work and live here, not just offshore
buyers who are flipping homes purely for a profit.
Now, while I appreciate the spirit of the bill, like my
colleagues, I do have a number of questions, which of course we will
canvass more in the committee stage. In particular, there’s a fair
amount of open-ended, unspecified aspects of this bill which give me
some cause for concern.
As an example, the type of information that developers are
required to gather is not clarified, unlike other bills we have seen
earlier this year, which makes me wonder why the government hasn’t been
more specific about the information they’re going to be requiring. Is it
that they haven’t had time to think through this bill, as we have seen
with other tax-related bills earlier this year, and announcements, or do
they want to keep it open-ended so they can decide at any time to
increase the amount and type of information being required? I’m not
actually sure what the answer is here. If I were a developer, I would
want a lot more clarity around the type and scope of information that
the government will require them to collect.
Further, there’s little clarity around what constitutes an
administrative penalty. Given that fines are now ten times higher than
what they were before, I believe the government has to be fair to
developers and provide them with additional detail as to when and how
administrative penalties will be assessed.
The bill also places a peculiarly heavy onus on developers to
gather and submit information without really outlining any
responsibilities, penalties or ramifications with respect to the
assigner and the assignee involved in the transaction. I think my
colleague from Prince George also touched on this. Particularly if the
desire of the purchaser is to avoid capital gains tax, one would have
thought this bill would cover the two sides of the party most involved
in the transaction and who benefit from the transaction.
Further, there are no requirements or penalties for assigners or
assignees who provide false information to developers. This is
concerning to me, because developers are not in the business of
information-gathering and records-keeping. They are in the business of
developing and selling properties.
This is another issue for me with Bill 25’s approach. I don’t
believe that developers are in a position to verify the information
provided by third parties, and it would be problematic to hold them
liable for false information provided by one or two parties to a
transaction. It seems to me that there would be other, more suitable
avenues to ensure that the required information was properly acquired
and vetted for accuracy, perhaps through the legal process of a
transaction.
Also, if an assignment takes place and a developer is not
notified, would the developer still be liable for a penalty? It is not
clear to me with this legislation. A developer, of course, cannot be
expected to keep tabs on all purchasers, so I wonder if this legislation
will really catch the people the government is attempting to
catch.
Further, what happens if an assigner and assignee agree in a
written assignment with a developer that the assignment fee for a
purchase agreement, for example, be $25,000, but they have a side
agreement that says that the assignment fee will be more like $100,000?
Would the developer still be held liable if they submit forms based on
the written assignment with the assigner and assignee? It appears from
the way the bill is written that the developer would still be in breach
section 20.4, an offence under
section 39.1(a), thereby exposing the
developer to penalties of up to $1.25 million.
[3:35 p.m.]
In other words, the bill has no due diligence or reasonable
efforts defence, meaning that developers could still be subject to
penalties, even if they use all reasonable commercial means to obtain
and provide the required data. As such, from my perspective, the bill
needs greater clarity in terms of ensuring that developers who are
acting in good faith but who are really at the mercy of assigners and
assignees providing correct and honest disclosures are not punished
because an assigner and an assignee acted under false
pretenses.
Further, this bill requires a developer to collect and remit to
the administrator and keep information for an unspecified period of
time. While we don’t have a lot of clarity in this bill with respect to
the type or extent of information, I’m presuming this information would
likely be of a private and confidential nature.
The developer is also expected to report to the administrator but
keep a copy of the assignment agreement in the prescribed manner for a
prescribed period. While there are confidentiality clauses with respect
to the administrator, surprisingly, there doesn’t seem to be any
corresponding requirement for the developer to ensure that the
information is kept confidential, unless I missed something.
In addition, I have real questions on how this bill will be
administered. Who or what department will be responsible for taking the
information gathered by developers? How will it be used, and how will
developers be held accountable? Will there be periodic audits or
anything to ensure that the appropriate practices are taking place? What
additional staff will be required to administer this bill to ensure that
it is effective in what it sets out to do?
Now, while I have a number of other questions, in the interests of
time, the final area I would like to note today that is not clear to me
and causes me some concern in its open-ended nature is the sharing of
data between governments. Again, while I think it is absolutely
appropriate to ensure that people are paying their fair share of taxes
and for governments to share information to ensure that that happens, I
have some concern with respect to clause 20.5(c)(i), which, again, seems
very open-ended.
It appears to confer the authority of this government to share any
information with any government that the B.C. government has an
agreement with. I’d be curious to understand what powers this is giving
the current government and under what circumstances, other than sharing
with the CRA, the government would look to share information with other
governments. Unlike 20.5(d), which references the ability to share
information for the purposes of compiling statistical information with
the federal government specifically, clause 20.5(
c) seems to be very
broad.
In
summary, I’m generally supportive of the direction of this
bill, and I do believe it has merit, in terms of supporting a fair
marketplace for both buyers and sellers, as well as ensuring fairness in
the taxation regime. However, I do have questions, as outlined in the
body of my speech today. I look forward to being able to discuss these
further at committee stage.
Deputy Speaker: Seeing no further speakers, the minister to close the
debate.
Hon. C. James: Thank you to all the members who spoke on the bill. I appreciate
the comments, I appreciate the discussion, and I appreciate the general
support for the direction that is being taken with this piece of
legislation.
I think it’s important, as we look at this legislation, to
recognize that there are stages and steps. I think a lot of the
questions that came, particularly at the start of the discussion on
second reading, really focused on future steps. What steps can we take
if you’re looking at ending condo flipping, if you’re looking at ending
the practice? That came from a number of the members who spoke. That’s
impossible to do unless you have the information. It’s impossible to
take those next steps until the information is gathered.
What kind of challenge do we have here? I think a number of
members talked about how much of a problem this is. How much of an issue
is this out there? Well, again, unless we have the information, unless
we gather the information, it’s impossible to know. That’s part of the
real frustration, I admit, in taking a look at addressing a lot of the
housing measures. There is a huge gap in information that just isn’t
collected or wasn’t collected over the last number of years.
My hope is that this bill and a number of other measures — which
as the members know, we’ve brought forward in this session as well —
start sharing information with various parts of government to be able to
gather the data that’s needed to make those kinds of next step decisions
that may need to occur.
I certainly appreciate the suggestions from members around what
other disincentives could be used to deal with condo flipping. I think,
again, getting this information and knowing the basics will make a huge
difference when we’re taking a look at that.
There was a lot of discussion, and I will get into it. I won’t
give lots of answers now around the specifics because I know we’ll get
there in committee stage, everything from the fines and why the fines
have gone up so much. If developers do their due diligence, what issues
are there?
I understood those questions. I think it’s good information for us
to be able to bring forward and have a discussion on, as I said, when we
get into committee stage.
[3:40 p.m.]
I appreciate the comments that have been made by the members. I
know we’ll have a chance — I think later this week — to have a further
discussion in committee stage.
With that, I move second reading.
Motion approved.
Hon. C. James: I move that the bill be referred to Committee of the Whole House
to be considered at the next sitting of the House after
today.
Bill 25, Real Estate Development Marketing Amendment Act, 2018, read
a second time and referred to a Committee of the Whole House for
consideration at the next sitting of the House after today.
Hon. D. Eby: I call second reading of Bill 28, the Public Interest Disclosure
Act.
BILL 28 — PUBLIC INTEREST
DISCLOSURE
ACT
Hon. D. Eby: I move the bill be now read a second time.
The proposed Public Interest Disclosure Act will encourage
employees to report serious wrongdoing by protecting them from reprisals
associated with such reporting.
Government agreed to introduce public interest disclosure, also
known as whistle-blower legislation, as part of accepting the
recommendation of the Ombudsperson’s 2017 report into the 2012 Ministry
of Health employment terminations and related matters.
The proposed legislation will initially apply to the public
service, including ministerial assistants and executive assistants in
ministers’ offices and officers of the Legislature, and is intended to
be applied to the broader public sector at a later date.
The Public Interest Disclosure Act is based on a review of the
best practices from around the world, with most of the content derived
from Alberta, Manitoba, Ontario and Australia. The Ministry of Attorney
General has worked in partnership with staff from the Public Service
Agency and have consulted extensively with the Office of the
Ombudsperson when drafting this act.
I would now like to highlight some key aspects of this
legislation. The act applies to certain types of wrongdoing, alleged
offences, acts or omissions that pose a danger to life and safety,
serious misuse of public funds or assets, and gross or systemic
mismanagement.
The act requires government to designate internal officers to
receive and initiate disclosures of wrongdoing and appoints the
Ombudsperson as an external reporting and investigative
entity.
The act places a positive obligation on government to advise
employees of the protections provided under this act and the different
ways in which employees can report serious wrongdoing. A person is not
given immunity from employment consequences if they participated in
wrongdoing that they subsequently disclose.
The act specifically authorizes disclosure to the Ombudsperson of
information that would otherwise be protected by public interest
immunity, which includes cabinet privilege.
The act also allows the discloser to share information that would
otherwise be protected by a specific provision in another statute to a
designated officer or to the Ombudsperson but not publicly.
The act allows for anonymous disclosures. Public disclosure is
permitted in very limited circumstances, and the discloser must comply
with the prescribed process.
The Ombudsperson is given the same investigative powers with
respect to disclosures under this act as the Ombudsperson has under the
Ombudsperson Act. The Ombudsperson may refer investigations to other
officers of the Legislature if the investigation relates to areas of
their expertise. For example, financial mismanagement may be referred to
the Auditor General. While referred matters will be dealt with under the
other officers’ legislation, the protection provisions of this
legislation will still apply.
It is an offence under the act to commit a reprisal against a
discloser, and the act gives the Ombudsperson the ability to make
recommendations about how to remedy the reprisal. B.C. will lead the way
and be the first jurisdiction to establish a low threshold for the
Ombudsperson to initiate an investigation into an allegation of
reprisal. This has been recommended in the OECD’s G20
Anti-Corruption Action Plan: Protection of
Whistleblowers .
A discloser will only be required to provide prima facie evidence
that a reprisal has occurred in order to initiate an investigation.
Unless the Ombudsperson believes the complaint of reprisal is frivolous
or vexatious, the Ombudsperson must investigate an allegation of a
reprisal. While an investigation must be initiated on prima facie
evidence, a civil standard must be satisfied to determine whether a
reprisal has in fact occurred.
The act ensures accountability to the public by placing an
obligation on all entities covered by the act to produce annual reports
detailing the number of allegations of wrongdoing that were reported and
investigated. The Ombudsperson is also obligated to produce annual
reports of disclosures they receive, resulting investigations and
whether the recommendations have been implemented.
In conclusion, the proposed legislation does not create a positive
obligation on anyone to disclose serious wrongdoing. Rather, it provides
protections to individuals who disclose serious wrongdoing to the
Ombudsperson or designated officers within government in accordance with
this act.
Moreover, the act specifically ensures that it does not take away
any existing protection provided to people who disclose wrongdoing under
other legislation. For example, current requirements to report
wrongdoing under the public service standards of conduct will remain in
effect.
[3:45 p.m.]
M. Lee: I rise today to speak to Bill 28. This bill, as the Attorney
General has outlined, follows on the recommendations in the
Misfire report, which followed the wrongful firing of
researchers from the Ministry of Health and the tragedy that followed
after one of them regrettably took his own life.
The bill provides a process and protection for individuals that
report wrongdoing, ensuring that whistle-blowers who come forward will
be shielded from retribution and ensuring that there is a fair process
for them to come forward. The bill also provides internally designated
officers to investigate these claims and also provides for the
Ombudsperson to be involved if need be.
From the 1980s to the early 2000s, only four OECD countries had
whistle-blower protection laws. Since 2006, whistle-blower protection
laws have been passed in nine OECD countries. Beginning in 2000, several
of these countries experienced preventable public scandals that inspired
the onset of dedicated whistle-blower legislation.
Other jurisdictions that have brought in similar legislation often
followed events such as publicly commissioned investigation inquiries.
Initial whistle-blowing legislation in Australia was motivated by the
Fitzgerald Inquiry, which occurred in the late 1980s. That inquiry, also
referred to as the Commission of Inquiry into Possible Illegal
Activities and Associated Police Misconduct, was an additional inquiry
that looked into the Queensland police corruption.
The commission resulted in the deposition of a Premier, two
by-elections and the imprisonment of three former ministers and a police
commissioner. That Fitzgerald inquiry recommended whistle-blower
legislation, which was slowly adopted by states and territories and
culminated in the adoption of the federal Public Interest Disclosure Act
in 2013.
They certainly didn’t move as quickly as Canadian jurisdictions
have following their own recommendations. For example, in Canada, the
federal sponsorship scandal, which involved gross misuse of public funds
intended for government advertising in Quebec, ran from 1993 to 2006.
The investigation into that scandal was done through the 2005-2006
Gomery report. The report recommended implementing dedicated federal
whistle-blower legislation.
In 2004, legislation entitled Policy on the Internal
Disclosure of Information Concerning Wrongdoing in the
Workplace was introduced into the House. The legislation did
not initially pass in 2004, but similar legislation in the form of the
Public Servants Disclosure Protection Act was passed in 2006.
More recently, in June 2017, the House of Commons Government
Operations and Estimates Committee released a report recommending
substantial changes to the Public Servants Disclosure Protection Act.
The development of this report was motivated by several recent federal
scandals, including the Lac-Mégantic rail disaster and the failure of
the Phoenix pay syst