1976 Legislative Session: 1st Session, 31st Parliament

HANSARD

The following electronic version is for informational purposes only.

The printed version remains the official version.

Official Report of

DEBATES OF THE LEGISLATIVE ASSEMBLY

(Hansard)

WEDNESDAY, MAY 12, 1976

Afternoon Sitting

[ Page

1629 ]

CONTENTS

Routine proceedings

British Columbia Buildings Corporation Act (Bill 23).

Introduction and first reading. Hon. Mr. Fraser — 1629

Oral questions

Gas price increase request by Imperial Oil. Mr. Lauk — 1630

Changes in stumpage revenue and timber volume. Mr. Gibson — 1630

Abortions in greater Vancouver. Mr. Wallace — 1631

Emergency employment programmes. Mr. King — 1631

Effects of BCR layoffs. Mr. Cocke — 1632

Effects of ferry layoffs. Mr. Lockstead — 1632

Increase in welfare applications. Ms. Brown — 1632

Anti-Inflation Measures Act (Bill 16) Second reading.

Hon. Mr. Wolfe — 1633

Mr. King — 1634

Mr. Gibson — 1645

Mr. Wallace — 1648

Mrs. Dailly — 1654

Mr. Hewitt — 1657

Mr. Skelly — 1659

WEDNESDAY, MAY 12, 1976

The House met at 2 p.m.

Prayers.

HON. W.N. VANDER ZALM (Minister of Human Resources): Mr.

Speaker, I would ask the House to welcome with me two gentlemen who are

here today representing the Canadian Paraplegic Association, an

association which has done many good works in British Columbia: Mr.

Doug Wilson and Mr. Doug Mowat.

MR. G.V. LAUK (Vancouver Center): Mr. Speaker, I would like

to add my personal welcome to the two gentlemen just introduced, and I

expect the hon. Minister of Human Resources will join me on Saturday at

their annual Wheelathon and give it a good start.

HON. K.R. MAIR (Minister of Consumer Services): Mr. Speaker,

in the gallery today is a gentleman, a chartered accountant from the

great city of Kamloops, Mr. Lawson Barnes, who is just about to open a

new office in Williams Lake in the great constituency of Cariboo. I

would ask the House to make him welcome.

HON. G.M. McCARTHY (Provincial Secretary): Mr. Speaker, on

the desk of each member today is an explanation of the new

salmon-enhancement programme that we are embarking on this year. I have

it on your desk today because, as you know, we had hoped to have the

federal Minister of Fisheries (Hon. Mr. LeBlanc) introduced to the

House today. Unfortunately, although he met with us for the first time

today in Victoria, in the capital city, he has returned on an urgent

call to Ottawa. I just wish to recognize his first visit to Victoria

under this new administration and look forward to the time when I can

introduce him from the floor of the House.

MR. E.N. VEITCH (Burnaby-Willingdon): Mr. Speaker, seated in

the gallery this afternoon from the great municipality of Burnaby is a

group of some 50 students, accompanied by their very able chaperon and

teacher, Miss Holly Rogers. Would the House bid them welcome, please?

MR. J.R. CHABOT (Columbia River): Mr. Speaker, we have in the gallery today, from Columbia River constituency, Mrs. Winnifred Weir, formerly editor of the Lake Windermere Valley Echo in Invermere. I would like the House to join me in welcoming her to the assembly.

MR. E.O. BARNES (Vancouver Centre): Mr. Speaker, I was inspired to rise.

I had no intention of doing so, but when the hon. Minister of Consumer Services

brought to my attention the presence of my cousin, Mr. Lawson Barnes, I simply

had to get up. I think the two of us must be ordained for something later, because

I found out also that he and I used to play golf together 10 years ago, and

look where he is. (Laughter.)

But, in any event, I do have a friend up there, Mr. Lawson Barnes,

whom I knew long before I went into politics. We have over the years

developed a very close friendship and we refer to each other as

cousins. I would like to have the House wish him again a very happy

visit with us, and I thank you, Hon. Member, for bringing him to my

attention.

MR. J.J. HEWITT (Boundary-Similkameen): Mr. Speaker, in the

gallery later on this afternoon there will be 50 students from the

Osoyoos secondary school. They will be accompanied by their teacher,

Mr. John Wallace. This group of grade 10 students are known as the

"1076" group and they've raised over $4,000 to pay for their trip to

come to Victoria to see the House in action and to tour Victoria and

the parliament buildings. I would ask the House to welcome them.

MRS. B.B. WALLACE (Cowichan-Malahat): I would like to welcome

to the gallery today a very senior member of the Cowichan Indian band,

a historian of that band and a long-time friend, Mr. Joseph Elliot.

MR. C.S. ROGERS (Vancouver South): My brother Martin is with us today. I would ask this House to bid him welcome.

HON. R.H. McCLELLAND (Minister of Health): Mr. Speaker, at

the request and on behalf of the member for Coquitlam (Mr. Kerster), I

would like to introduce two people from his constituency, Mr. Ken

Macdonald and Denise Mallinson, who are sitting in the Speaker's

gallery. I bid welcome to them.

Introduction of bills.

BRITISH COLUMBIA

BUILDINGS CORPORATION ACT

Hon. Mr. Fraser presents a message from His Honour the Administrator: a bill

intituled British Columbia Buildings Corporation Act.

Bill 23 introduced, read a first time and ordered to be placed on

orders of the day for second reading at the next sitting of the House

after today.

MR. LAUK: Now the Shrum report.

[ Page 1630 ]

HON. A.V. FRASER (Minister of Highways and Public Works): Mr. Speaker, in response to the member for Vancouver Centre, I now table the Shrum report.

MR. LAUK: You give good service. Did you check with Bill?

Oral questions.

GAS PRICE INCREASE

REQUEST BY IMPERIAL OIL

MR. LAUK: Mr. Speaker, a question to the hon. Premier.

Yesterday I asked the Premier if the government was going to comply

with Imperial Oil's request to be allowed to increase the price of

gasoline immediately when the federal government allows an increase in

the price of oil by the barrel. The Premier replied that the province

now has a freeze at the refinery level.

Our staff checked with the B.C. Energy Commission this morning and

they were unable to refer us to any order-in-council or other document

that actually freezes the price.

Can the Premier clarify his answer by telling the House exactly what

document spells out the freeze that he referred to yesterday?

HON. W.R. BENNETT (Premier): Mr. Speaker, the freeze is an

extension of the freeze that was first put on last October. While our

government extended the freeze twice on all goods that were covered —

to February 16 — when we removed that freeze we left it in this

particular area.

MR. LAUK: A supplemental question. If the hon. Premier is referring to the Energy Act....

Interjection.

MR. LAUK: Are you not? Could the hon. Premier...?

HON. MR. BENNETT: It was put on last October.

MR. SPEAKER: Order, please. Would you state your question?

MR. LAUK: Well, Mr. Speaker, I would ask the Premier to

indicate what power the government has to freeze the price at that

level and what document we can refer to.

HON. MR. BENNETT: Mr. Speaker, this is the extension of the

freeze that was put on by the previous government. The freeze was

relieved on all products with the exception of petroleum products at

the refinery level by order. I will bring into this House tomorrow the

statement we made when the freeze was lifted on all other products.

MR. LAUK: A supplementary. If the hon. Premier is referring

section 67 of the Energy Act which does not impose an actual freeze,

but gives the government power to prevent undue increases in price, may

I repeat my question: will the government comply with Imperial Oil's

request to be allowed to increase the wholesale price of gasoline when

the oil barrel price goes up as advocated by the Premier?

HON. MR. BENNETT: Mr. Speaker, I answered this question

yesterday. There is no increase contemplated, and no change in the

present freeze that we extended on this product is being considered. I

might say that before the House now is a bill which also contains the

right of the government to freeze all products to fight inflation.

MR. LAUK: You've got it already.

CHANGE IN STUMPAGE

REVENUE AND VOLUME OF WOOD

MR. G.F. GIBSON (North Vancouver–Capilano): Mr. Speaker, a

question to the Minister of Forests. Before the relaxation of the close

utilization standards which were announced by his deputy yesterday, I

assume the minister obtained certain statements of impact. I wonder if

he could tell the House an estimate of the change in stumpage revenue

for the balance of the year as a result of this move and the change in

the volume of wood to be removed from the forests.

HON. T.M. WATERLAND (Minister of Forests): Mr. Speaker, in

response to the member, there will be a very slight increase in revenue

to the provincial government because we are doing away with the 55-cent

wood increment when the standard changes to somewhere between close

utilization and intermediate utilization.

What'll happen is that we will, instead of this time next year

having an anticipated surplus of pulp logs of somewhere near 527,000

units, hopefully be down to about 175,000 units, so that will be

roughly the difference in wood not taken out of the woods.

MR. GIBSON: Just on a supplementary, then. That's an expected

decline, if I did my quick arithmetic correctly, of 350,000 units over

that period? Thank you.

MR. LAUK: Supplementary to the hon. Minister of Forests with

respect to the question asked by the hon. Liberal leader. As this

relaxation of regulations

[ Page 1631 ]

for cl ose utilization i n

the forest industry — will inevitably lead to greater profits to the

forest companies as well as an upturn in the forest market in the

United States currently underway, is the Minister of Forests

considering raising stumpage levels to their normal rate? Because they

were artificially lowered by the NDP last year during a slump.

HON. MR. WATERLAND: The intention of these minor changes in

utilization was primarily for the purpose of relieving the terrible

surplus we have of both pulp logs and wood chips. Now if this should

reflect a minor change in the profitability of the forest companies....

MR. LAUK: Substantial.

MR. SPEAKER: Order, please.

HON. MR. WATERLAND: A minor change. No, we're not at this

time anticipating any changes in the stumpage regulations. As the

member knows, Dr. Peter Pearse is assessing the whole forest sector and

we're not going to make any substantial changes until such time as his

report is in.

MR. LEA: The answer is "no."

ABORTIONS IN GRE ATER VANCOUVER

MR. G.S. WALLACE (Oak Bay): I'd like to ask the Minister of

Health a question with regard to statistics showing that in British

Columbia there are 41 abortions for every 100 live births in greater

Vancouver. In view of the fact that the B.C. rate is by far the highest

of any province in Canada, and since cases can be documented where the

abortion was carried out beyond 20 weeks of pregnancy, has the minister

conducted any specific investigation into the fact that the provisions

of the Criminal Code in regard to abortion in British Columbia are

being broken every day?

HON. R.H. McCLELLAND (Minister of Health): Mr. Speaker, to

the member for Oak Bay, I have this afternoon asked my department to

investigate many of those allegations which have been made by the

Pro-Life Society and others. I hope for a report very quickly.

MR. WALLACE: On a supplementary. First of all, I very quickly

commend the minister for his prompt action. I appreciate his answer.

I'd like to know if the minister, on any of the cases where it has been

brought to his attention that the child was born alive and subsequently

died, has notified the Attorney-General's department with a view to

laying charges against the surgeon for negligent management of a live

birth.

HON. MR. McCLELLAND: Mr. Speaker, to the member for Oak Bay

again, the answer is no. I have not officially, until today, had any

indication of that happening and no direct indication to our office.

MR. GIBSON: On a further supplementary, I would ask the

minister if he would be prepared to make that report to which he

referred public and table it in this House when it's received.

HON. MR. McCLELLAND: I don't have a report, Mr. Speaker, through you, to the Liberal leader.

Interjection.

HON. MR. McCLELLAND: Oh, I'm sure that that will be available at that time. It will be a public report when it comes.

AN HON. MEMBER: Open government.

POSSIBILITY OF EMERGENCY

EMPLOYMENT PROGRAMMES

MR. W.S. KING (Leader of the Opposition): A question to the

Premier. I note that yesterday he indicated there were no special

employment programmes being contemplated by the government to

accommodate the extremely high level of unemployment, and he talked

about a three-year programme. Again I would ask the Premier whether he

is now considering any emergency steps to deal with the extremely high

level of unemployment in the province and the announcements that yet

more people will be added to the ranks of the unemployed as a result of

layoffs in Crown agencies.

HON. MR. BENNETT: Mr. Speaker, in response to the Leader of

the Opposition, the programmes that the government introduced after

December 11, both through the Department of Economic Development and

other departments, to seek ways to create employment are now beginning

to take shape. The continuing unemployment that was with us then, and

is still with us, as I said yesterday, hopefully would start to respond

soon but I couldn't see a major breakthrough before the end of the

three years because of the lead time required to get many projects

going. It's one of the difficulties in British Columbia that we've lost

two years of investment because of lack of confidence that creates this

situation today.

Interjections.

MR. SPEAKER: Order, please.

MR. KING: My supplementary is very brief, Mr.

[ Page 1632 ]

Speaker. I'm not interested in a political debate;

I'm interested in learning whether or not the Premier has plans to

initiate any direct employment programmes this year, as opposed to any

appraisal of the long-term economic prospects,

HON. MR. BENNETT: The answer is yes.

MR. KING: On a supplementary, Mr. Speaker, could the Premier

then outline for the House precisely what these direct employment

programmes are and when they might be initiated?

HON. MR. BENNETT: Mr. Speaker, it's a matter of government

policy. I'm surprised that the opposition leader didn't question the

Minister of Economic Development (Hon. Mr. Phillips), who just had his

estimates up and who has several very major programmes underway. During

my own estimates I will be prepared to answer questions of this nature.

EFFECTS OF BCR LAYOFFS

MR. D.G. COCKE (New Westminster): Mr. Speaker, I'd like to

direct a question to the Premier of the province. Since 1,200 people

have been laid off on the BCR has the Premier, as responsible minister

for the whole province, ordered a report on the ripple effect that that

will have on jobs that will be highly influenced all along the BCR and

all through the north and the Cariboo in this province?

HON. MR. BENNETT: Mr. Speaker, we've been alarmed for some

time at the lack of operation on the B.C. Railway that emanates from

both sides. I've been in discussion with the minister responsible, and

I hope that when he has a report from management we can share that

report with the House. I'm hopeful that by then the two sides can get

together and perhaps in a very concrete way do something for British

Columbia rather than against British Columbia.

MR. WALLACE: On a supplemental, Mr. Speaker, could I ask the

Premier then, or the minister involved on the board of BCR — the

minister of Economic Development (Hon. Mr. Phillips) — if he was

consulted by the BCR board about the decision to lay off the 1,200

workers? Did he give his personal agreement on the decision, even

although UTU workers are not on strike but simply working to rule?

HON. MR. BENNETT: No, I wasn't consulted.

EFFECTS OF FERRY LAYOFFS

MR. D.F. LOCKSTEAD (Mackenzie): Mr. Speaker, in view of the

large number of unemployed in British Columbia at this time, are any

studies being contemplated as to what effect may be felt in a small

community like Gibsons which relies on B.C. Ferries and which will be

having large numbers of laid-off ferry workers?

HON. MR. BENNETT: I wonder, Mr. Speaker, if the member might

direct that question to the Minister of Transport, under whom the

ferries come. I as the Premier have not instigated such a study.

MR. LOCKSTEAD: Supplementary then to the hon. Minister of Transport. Perhaps he could once again answer this question.

HON. J. DAVIS (Minister of Transport and Communications): Mr.

Speaker, through you to the hon. member, we've been endeavouring to

find employment in other areas in the public service for ferry workers

who will be laid off June 1, and that effort will continue.

INCREASE IN WELFARE APPLICATIONS

MS. R. BROWN (Vancouver-Burrard): To the Premier, Mr.

Speaker. In view of the fact, Mr. Premier, that by the actions of your

government there has been such a rapid increase in unemployment in this

province, have you spoken to the Minister of Human Resources (Hon. Mr.

Vander Zalm) with a view to having him lift the freeze on certain areas

of the province where people will not be allowed to live if they are to

receive welfare payments, in view of the fact that there are more

people on welfare as a direct result of the actions of your government?

HON. MR. BENNETT: Mr. Speaker, to the political statement of

the member for Burrard, the unemployment rate hasn't been as a result

of actions of this government, if you look back. If the member had

taken the trouble to read the document filed in this Legislature

yesterday showing the unemployment statistics, and if the member had

made herself aware of the change in the measurement of unemployment by

the federal government just recently in which those statistics are

calculated, she would realize that last September was the peak of

unemployment in numbers of people and that we continue to have the high

unemployment that started in late 1974. Yes, it's a problem, but I

resent the fact that that member tries to place responsibility on this

government after four months when we're living with the result of two

or three years of inactivity of that government.

Orders of the day.

HON. G.M., McCARTHY (Provincial Secretary): Mr. Speaker, by leave, second reading of Bill 16.

[ Page 1633 ]

Leave granted.

ANTI-INFLATION MEASURES ACT

HON. E.M. WOLFE (Minister of Finance): Mr. Speaker, Bill 16,

which has been before the House for some three or four weeks, the

Anti-Inflation Measures Act, has two primary objectives and they are

reasonably simple. No. 1 is to empower this government to sign an

agreement with Ottawa under their national anti-inflation programme.

No. 2 is to put legal authority behind the regulation, investigation

and reviewing of prices within the province.

Previous price freezes and so on, which have been reasonably

successful within this province, have not actually had the legal

authority to support them, so we feel that in the future this should be

fundamentally necessary, because in the past these could have been

brought under a legal attack.

Mr. Speaker, I'm grateful for this opportunity to speak in support

of this bill. A few hours after this government was sworn in last

December, the Premier dispatched three ministers and two of our senior

officials to Ottawa to discuss the national anti-inflation programme

with federal ministers and their advisers. I was honoured to join that

delegation, and with me were my colleagues, the Minister of Labour

(Hon. Mr. Williams) and the Hon. Minister of Consumer Services (Hon.

Mr. Mair).

Now in going to Ottawa within hours of our appointments we wanted to

make very clear the commitment of this government to fight inflation,

and we wanted to make it very clear that there must be equity in the

fight against inflation. We agree entirely with the suggestion that any

call for wage restraints must be echoed just as strongly by a call for

restraint in prices. Our misgivings about the ability of the federal

programme to ensure equity have been stated publicly at the time of our

trip to Ottawa and later when this government twice extended the

provincial price freeze to February 16.

We want the ability to keep prices under review to be stated

unequivocally in the statute books. We don't want any doubts on that

score, such as might have been the case with the last price freeze.

That is why, Mr. Speaker, Bill 16 clearly sets out the procedure for

reviewing and studying prices of commodities and services and, if

necessary, for fixing maximum prices and/or establishing

price-restraint guidelines in British Columbia.

Mr. Speaker, these are difficult times, and the measures before this

House speak to the responsibility of provincial governments to practise

restraint, to move against inflation and, very importantly, to make it

clear that provincial interests will be safeguarded in these times of

economic uncertainty.

Mr. Speaker, we intend to protect provincial interests, while at the

same time cooperation with the national anti-inflation programme. In

his statement of February 27 the Premier made it clear that provincial

machinery would be established to review pricing decisions of Crown

corporations providing services in the public sector, and that the

exercise would drive home the point that these corporations are to

operate on sound financial principles and are accountable to the people

of British Columbia for the prices that they want to charge.

The anti-inflation programme makes it clear that these are the goals

to follow. Mr. Speaker, you don't cure the disease of inflation by

incurring ever-rising deficits in the operation of public-sector

suppliers. We have practised fiscal restraint and financial

responsibility in this regard and we shall continue to do so. We will

not postpone price increases where, in fact, common sense shows that

they are absolutely necessary.

Again, Mr. Speaker, on the subject of prices, we intend to continue

the present programme limiting rent increases. The preparation of

guidelines is in its final, stages whereby the B.C. Marketing Board

will be instructed to review carefully any pricing decisions by the

various individual marketing boards to ensure that only fair and

reasonable price increases on farm products are permitted.

Bill 16 would give proper authority to this government to enter into

an agreement with Canada under the federal Anti-inflation Act to carry

out anti-inflation programmes. This is one of our immediate goals, and

we are anxious to conclude our discussions with Ottawa in order to

close ranks with our other provinces which have all — except for one,

namely Saskatchewan — signed agreements with Ottawa to have the

national guidelines apply to the provincial public sectors for a period

of time, most likely to April, 1977.

Mr. Speaker, any agreement that British Columbia signs will make it

clear that the arrangement is temporary and is meant to give united

support to the fight against inflation. My colleague, the hon.

Attorney-General (Hon. Mr. Gardom), on April 9 stated that British

Columbia would be supporting the federal Anti-Inflation Act in the

reference to the Supreme Court of Canada scheduled for the end of May

on the basis that Ottawa has the authority to act in the interest of

all Canadians during a time of national crisis or emergency. As the

Premier noted on April 9, the national guidelines will apply to the

provincial public sector. And for the life of any agreement with the

federal government, British Columbia intends to refer all public-sector

compensation agreements arising since October 14, 1975, to review by

the Anti-Inflation Board.

There are well over 150,000 workers in the

[ Page 1634 ]

provincial public sector. Since the beginning of

the year we have stated that it is the intention of this government to

have the national guidelines apply to these employees, just as they

apply right across the country now. In the longer run, and certainly

after any agreement with Ottawa has run its course, we want to have in

place improved systems for arriving at fair pay levels for public

employees. We want an efficiently run public sector. We will be

realistic, but we will resist any system of bargaining which puts

public pay levels out of whack with compensation for comparable work in

the private sector.

Mr. Speaker, Bill 16 represents, the legal framework for a

cooperative attack on inflationary pressures and for asserting a firm

provincial presence in restraining the upward spiral of prices that

affect all British Columbians. I urge all hon. members to give the

measure of their support so we can get on with the job.

Mr. Speaker, although I appreciate that we are not now in third

reading, in committee, I would like to make mention of the fact that we

propose an oral amendment in third reading, adding the reference to

section 1 of the bill which, I might say at this stage for the

information of the members, would delete (

b) under

section 3(2)(b).

As I said before, this bill has two main objectives: one is to

authorize our proposed agreement with Ottawa; secondly, it is to

reinforce the legal authority for us to review and fix prices in the

commodity ranges within British Columbia.

Interjection.

HON. MR. WOLFE: In

section 1, Mr. Member, through you, Mr.

Speaker, the reference to

section 3(2)(

b) should omit (b). The

reference should be to

section 3(2).

Mr. Speaker, I move the bill be now read a second time.

MR. W.S. KING (Leader of the Opposition): Mr. Speaker, the

official opposition is very disappointed to hear such a pallid

statement by the Minister of Finance on what is an extremely important

issue facing not only this province but facing the nation at this

particular time, as it has threatened the nation over the past number

of years.

I am confident that the erosion of real income, both to organized workers,

unorganized workers and to fixed-income people such as senior citizens, has

been a tremendous concern. This constant erosion of the real income, has created

hardship on a very, very wide, sector of our people throughout Canada; certainly

that is true in British Columbia. So beyond question I think there is a collective

desire among Canadians to try to do anything within the bounds of reason to

attack this problem of inflation and hence protect the real income of the citizens

of the nation not only against inflation per se — the erosion of the dollar

value — but certainly in terms of protecting the relative positions of wage-earners

throughout the nation. Lord knows, Mr. Speaker, there is enough disparity in

terms of income groups throughout the nation to warrant real concern.

Our party, the New Democratic Party, would certainly like to have

seen an approach taken by the provincial government which would have

effectively come to grips with the problem of inflation, which would

offer some equitable process for ensuring that all sectors of society

bore equal responsibility in this very important desire of most

Canadians to dampen the flames of inflation. But, unfortunately, we

find they have done little more in Bill 16 than to say:"Yes, we will accept the direction of the federal government. We will

apply the federal wage-control policy." And that's basically

what it is, a wage-control policy rather than wage and price policy. We will

apply this in the realm of the public sector in British Columbia.

The reality, of course,

is that these restraints have been applied through the initiative of

the federal government to our private sector since October last.

Unfortunately, though, we see nothing in Bill 16 that clearly outlines

what the provincial government intends to do, if anything, to make sure

that the programme has application not only to wage-earners in the

province but to the incomes of high executives, to the salaries of

professional people, indeed to interest rates which are one of the

prime ingredients of the inflationary problem. We see nothing in the

bill that clearly spells out anything other than a programme of wage

restraint in this province. I say, Mr. Speaker, that this is

unacceptable.

I think we should have a look at some of the things that have been

said about the federal programme as it was introduced. A good deal has

been said beyond the political realm by columnists, by business people,

by trade union groups. Some very perceptive things have been said which

give an indication of the inadequacy of the programme which the federal

government introduced, of the inequity of that programme, of the fact

that it bears and weighs heavily only on working people and the average

income-earner of the nation while doing nothing to protect those groups

against the ravages of increased dental costs, increased medical costs,

increased legal fees, increased price increases because of the imported

aspect of legislation — not a word about that. I say, Mr. Speaker, that

certainly my worst fears have been realized. This government in concert

with the federal government is prepared to wage in full the

anti-inflation fight on the backs of the average people of this nation

without respect to any equity, without respect to any fair and

equitable call or demand upon all sectors of society that they share

and sacrifice

[ Page 1635 ]

equally in this need to dull the fires of inflation. That's what we can conclude from Bill 16.

I want to deal with a few of the things that have been said about

the federal wage-control programme. I've compiled here a number of

statements made by the chairman of the Anti-Inflation Board, the Hon.

Jean-Luc Pepin. He has been quoted as saying: "If people don't want it

to work, there are 111 ways of getting around it." He was quoted in the

Victoria Colonist on October 16 as making that statement. That is the

chairman of the board. I want to say, Mr. Speaker, that I agree with

him. There are 111 ways of getting around that programme for certain

people, not for working people, not for pensioners, not for the

unorganized; but there are 111 ways for the land speculators, for the

banks, for the finance companies, for the food industry, for the oil

companies, for professionals.

What are the problems of trying to apply a wage-restraint programme

to professionals? The problems are, Mr. Speaker, that they simply have

to increase the volume of the work that they do to increase their real

income. If there were any serious attempt to be equitable and apply the

same constraints to professionals as apply to wage-earners, there would

have been a regressive tax attached to income over a certain

percentage. No such thing. No such thing!

What about the real estate wheelers and dealers, the stock and share

traders, the large corporations, for all business in general?

The chairman of the Anti-Inflation Board is absolutely right. There

are 111 ways of evading any constraints or restrictions upon the elite,

upon the chosen few throughout this nation. Indeed, with the

collaboration of the provincial government now we see that the average

Canadian, the average British Columbia worker and senior citizen are

being called upon to carry the can completely for the economic malady

of inflation that's beset this nation for many years.

But I say, Mr. Speaker, there isn't even one way around it for the

vast majority of Canadians. They are the majority, and the stringent

wage guidelines that have been laid down in legislation applicable to

workers are impossible to evade or escape. Let's look at some of the

things that have been said about the Anti-Inflation Board by others.

Alan Fotheringham — he's not an economist but he's a bright journalist

— in a column of his on November 20, 1975, made these observations:

"The unfortunate aspect of Dave Barrett's search this

week for restraint are his complaints about Ottawa. Mr. Trudeau's

patchwork guidelines are unfair; that's the unfortunate part of it. The

sections dealing with profits are a farce. Does anyone seriously think

that the take-home pay of lawyers, to use one example, will be held to

a 10 per cent increase next year? The current joke in the legal

profession is that the Trudeau legislation should be entitled 'The

Lawyers and Accountants Charitable Act.'"

AN HON. MEMBER: That's true.

MR. KING: "The Lawyers and Accountants Charitable Act" — since that is what it is.

As Sun business editor George Froehlich has written:

"In essence, the Trudeau guidelines are stacked

against labour and in favour of business. They represent what has been

becoming evident over the past while: Trudeau has become a captive of

the managerial class in Canada. His party long ago surrendered to that

segment of society, and his latest action indicates the Prime Minister

has succumbed also."

MR. R.L. LOEWEN (Burnaby-Edmonds): What a bunch of nonsense!

MR. KING: I have quite a number of choice quotes, Mr.

Speaker, and I intend to deal with them extensively because people tend

to forget what occurred when this programme was first introduced last

October. I think it is appropriate that this backdrop to the current

action by the provincial government be put in perspective. I want to

quote George Froehlich, the business editor of the Vancouver Sun . On October 18, 1975, in the Sun , he had this to say:

"How can the board, for example, police the salaries

of doctors, dentists, lawyers, management consultants, et cetera? It

will be an impossible task. In essence, the Trudeau guidelines are

stacked against labour and in favour of business."

The Vancouver Province , a news item on October 18, 1975:

"B.C. consumers, cheesed off with rising supermarket

prices, are letting the federal government know about it 500 times a

day. Since Prime Minister Pierre Trudeau announced selective wage and

price controls last Monday, an inquiry department at Revenue Canada's

Vancouver office has been getting more that 500 complaints each day

about rising prices, mainly food prices."

I want to say, Mr. Speaker, that that concern expressed by so many

British Columbians has received proof positive in the last number of

months by revelations from Statistics Canada that food prices in this

province have escalated to the highest cost area in Canada, exceeding

the national norm...

[ Page 1636 ]

MR. LOEWEN: Why?

MR. KING: ...exceeding the costs of any other area of Canada.

MR. LOEWEN: Why?

MR. KING: So the concern of our citizens has been confirmed.

The Daily Colonist of October 21, 1975, had an editorial about the

federal programme. It had this to say:

"The controls package is lacking. Some of the contents are quite

objectionable. There is the selectivity of the controls as the main

stumbling block in the selling job with some segments of the work force

being played against others. Controls in prices which really are curbs

on profits through a highly complex formula difficult to follow are

hard to swallow, particularly when they will have little or no effect

on the purchase of groceries."

Another editorial in the Victoria Times on October 14, 1975, shortly

after the federal programme was introduced, and I quote from an excerpt

from that editorial:

"On the surface they are not equitable, favouring

business at the expense of labour. For example, persons earning only

$5,000 per annum would be allowed increases of $600 per annum. Those

earning $30,000 or more would receive increases of up to $2,400 per

year. While wage increases are limited to the 10 per cent formula,

price increases will only be considered after they occur. If nothing

else, this gives business a great psychological advantage. Any

regulation of profit under the current proposals appears farcical. The

Prime Minister was vague on this mechanism, but any businessman who

sees a large profit looming can bury it in a variety of ways such as

plant expansion. Profit can appear small even if it is large."

I want to say, Mr. Speaker, that it's very common knowledge that

there are a whole variety of ways open to business to hide the real

profits of their operation so that the impact of the federal wage and

price guidelines on them is completely meaningless. I think that's

appreciated by all the citizens of the province of British Columbia and

the people of Canada. They are not naive enough to believe that there

is an effective mechanism offered in the programme for in any way

affecting profits, for in any way affecting prices. Certainly, as

pointed out in the editorial I referred to, at best, by the

government's own admission, this could only happen after the fact

anyway. It means that at one and the same time people, private

citizens, are being regulated in terms of their income. It means that

they will have to pay increasing prices for the groceries, goods and

commodities they need to sustain them on a daily basis. And only down

the road, at some vague point in the future, may investigation occur to

decide whether those increased and accelerated prices they've had to

pay were excessive and then, perhaps, the Anti-Inflation Board or the

government may move. I say that's not good enough. That's not equity in

the programme to fight inflation. That's no way to convince the people

of this province that they should get behind the programme and lend

their full cooperation to it — and that is what is needed.

I point out, Mr. Speaker, that the wage guidelines contained in this

legislation are clear and they are enforceable. But, you know, there's

only 43 per cent of the work force in British Columbia organized, and

on the national basis it's much less than that. So what we have is a

programme specifically enshrined in legislation which outlines very

specifically the constraints on wage increases. That's enshrined right

in the legislation. But no similar, specific restraints are contained

in the legislation to tell how the government or the Anti-Inflation

Board are going to control costs, are going to control profits, are

going to control interest rates or are going to control any of these

things which, in my view, Mr. Speaker, are the major culprits in

fanning the flames of inflation.

There's one other area that is of primary and paramount importance,

in my view, in terms of creating an inflationary problem, and that is

the money supply. Nothing in any of the federal or provincial

legislation indicates that different fiscal policy is going to be

developed by the federal government to solve that problem of an

inflated money supply being generated yearly.

I think it's inherently unfair to zero the whole focus of this

programme in our province on just 43 per cent of the work force who are

organized, and to which this programme of wage restraint applies, while

completely ignoring the fact that that small a percentage of the work

force could in no realistic way be considered as the prime villains in

terms of creating inflation. That's a myth that many people have

propagated with the help of some corporate interests, with the help of

some of the media and certainly with the active assistance and

participation of this government, Mr. Speaker.

It is a disproportionate burden that working people and fixed-income

people are being asked to accept in what is referred to as an

anti-inflation programme. The chairman of the Food Prices Review Board

is conscious of the fact that the legislation framed by the federal

government, and proposed to be accepted in Bill 16 before this House,

is deficient in terms of having an impact on other than working people.

In an

article in The Vancouver Sun on April 10 of this year: "Pepin Prays Companies Heeding Price Controls." He prays that those companies out there

[ Page 1637 ]

are going to heed price controls. What a weak performance, Mr.

Speaker! He prays that they will heed price controls. He doesn't pray

that the work force will; he imposes definite, precise, restrictive

constraints upon the working people. But when it comes to his friends

in the corporate area, he prays that they will be sensitive enough to

heed the national good. And we find here a provincial government that

apparently is prepared to accept the same approach. They pray.

Oh yes, there are sections in the bill giving the provincial

government power, but there's no precise formula telling this House and

telling the people of British Columbia exactly what those constraints

are going to be, that they are going to be current in the same way that

wages are restricted, that they are going, in fact, to be adjusted at

all — simply a power given to the government to review after the fact.

That's of small benefit to people who are having their wages frozen now

and still have to go to the grocery store and purchase groceries, who

still have to go to the architects, the dentists, the doctors to

purchase their services, and pay accelerating costs because there are

no constraints. It's of small benefit to those who are seeking mortgage

money and bank loans with no constraints imposed thereupon either.

I wonder about the sincerity of this government, Mr. Speaker, when

they sit there blandly and say: "Well, the power's in the Act."

Just a few moments ago in the question period the Premier indicated

that the price freeze introduced by the NDP administration last fall to

make sure that the kind of inequity that I'm talking about did not run

away — the Premier tells us that he's kept the price freeze on

gasoline. When the first member for Vancouver Centre questioned the

Premier on his authority to do so, the Premier said: "I didn't do it

under the Energy Act." Well, if he didn't do it under the Energy Act,

Mr. Speaker, he's openly admitting that he has all the authority the

government needs to restrain prices now — has had, ever since the

anti-inflation programme was introduced last October.

The fact is that the provincial government has virtually removed

every constraint upon prices in this province and allowed them to

accelerate at a rampant rate, and now they come before the House with a

bill that lays out the precise mechanism for applying wage restraint to

the public domain of British Columbia, 150,000 public employees. There

is nothing in the legislation other than the vague power to do

something. If they were sincere, if they were serious, why haven't they

acted before now to tighten price controls in this province? In fact,

the opposite has developed. The price freezes that were instituted by

our administration have been all but removed with the exception of the

gasoline prices that the Premier revealed to the House today.

Apparently he was able to do that without any legislative authority.

He didn't do it under the Energy Act. I say this is a phony bill before

the House. It's not necessary, because if this government were serious,

Mr. Speaker, they could well have controlled prices before this time

and held them to some realistic level.

Interjection.

MR. KING: It did indeed. So I say, Mr. Speaker, I'll get to

the performance of the provincial government. I'll reach that point

where I examine the record of precisely what this government has done

about holding some kind of lid on inflation in this province, on

spiralling costs of groceries, rentals, home-heating fuels, automobile

insurance rates, ferry rates, transportation costs generally, all of

these things that affect the real income of homeowners in British

Columbia. I intend to review the record of the provincial government.

You know, I think it's a bitter shame because, as I said at the

outset, the people of British Columbia and the people of Canada were

generally concerned and generally prepared to lend their efforts to

some attack, some national attack, having a national consensus on the

problems of inflation. They were prepared to do that provided everyone

was called upon to make some sacrifice, but they were not prepared, Mr.

Speaker, to collaborate in a programme that placed a disproportionate

burden on the average guy without calling for any sacrifice at all from

the corporate giants of this nation and the corporate giants of this

province, from the professionals, from the money lenders and the land

speculators. They're left free to play their game.

I say to you, Mr. Speaker, that observers are absolutely right. In

order for any programme of inflation control to work it has to be seen

to be equitable. It has to be seen that each and every element of

society is making a sacrifice in the national good.

I say that the federal and provincial governments should be

absolutely ashamed for the one-sided programme they have put forth in

terms of developing any national consensus on this important issue.

The record that the Premier talks about in terms of doing things

should be looked at, Mr. Speaker. I think it's appropriate that we have

a look at that record and see what has happened. I think I have a list

here somewhere that I want to just review in terms of precisely what

the former administration in the province of British Columbia did to

stabilize prices and costs to the average family in the province,

because we recognized that as soon as the federal programme was

introduced it was applicable, by and large, to most working people in

the province —

[ Page 1638 ]

certainly all the private sector was gathered in immediately, with employees over the 500 number.

So in October, shortly after the federal programme was introduced,

our government in British Columbia, on October 24, moved to increase

Mincome from $250 to $265 per month for single persons and $540 for

couples, to try to close some of the disparate gap that exists between

incomes in this province — and which is a problem for all governments

to face if they are interested in any degree of social equity.

We announced an increase in the minimum wage from $2.50 to $3 per

hour, phased in over a period of months — again to try to build up the

lower spectrum of the people who are struggling to keep pace, who have

no economic clout, like the trade unions or others to keep pace with

the rampant flames of inflation.

Interjection.

MR. KING: Yes, by all means. Oh, yes, the authority was given to the Board of Industrial Relations to....

Interjection.

MR. KING: Well, you followed the policy announced publicly by

the NDP. I regret, Mr. Speaker, that the election of December 11

interrupted our ability, briefly, to carry through on those programmes,

but come another election, I think we will be back making those kinds

of decisions again, Mr. Speaker.

We announced at the same time continuation of rent control with a

decrease from 10.6 per cent to 8 per cent for 1976 so the business

community would be called upon, too, to show some restraint and make

some sacrifice, and keep costs lower to those who had no economic

clout, no upward mobility like certain members of the government have,

and big business and big unions and so on which have the clout to make

it very well on their own.

We announced a plan to establish a housing corporation to provide

first mortgages at lower interest rates. We put a price freeze on all

food and beverage products — the only province in Canada that did so.

We put a freeze on all energy prices, including home heating oil,

gasoline, propane, natural gas and electricity, because they are

crucial, inherent ingredients in the cost of living to homeowners in

this province.

We put a freeze on transportation, including ferry and bus fares. We

announced new legislation to be introduced on rent control on

commercial properties to help small businesses. We demanded that Ottawa

control bank profits, interest rates, mortgage rates and professional

incomes. We said to Ottawa: "These are the things that must be done if

you want the collaboration and the cooperation of the British Columbia

government in coming to grips with the problem of inflation." And we

had some bargaining clout, Mr. Speaker, in terms of developing those

things.

Interjection.

MR. KING: Mr. Speaker, the government members can sneer all

they wish, but I was in Ottawa before the Minister of Labour (Hon. Mr.

Williams) and the Minister of Finance (Hon. Mr. Wolfe) were there. The

former Minister of Finance (Mr. Stupich) and myself met with the other

ministers from the provinces and their federal counterparts in Ottawa,

and we drew to their attention some of these inequities — for instance,

the disparity between the allowable wage increases of $600 a year to

low-income earners as opposed to the $2,400 allowed to the high-income

earners. The federal government listened; they agreed with us and they

took away that minimum ceiling, and that was a result of our

representations.

So the Minister of Labour shouldn't sneer too much. I think if he had

taken a more aggressive approach in Ottawa, the things we demanded, in terms

of controlling interest rates, in terms of realistic mortgage rates and controls

on professional incomes, were attainable too. They were attainable too, if this

provincial government had taken a tough stand in Ottawa.

SOME HON. MEMBERS: Hear, hear!

MR. KING: They apparently failed to do that, or were

sufficiently unconcerned with what it meant to British Columbians that

they didn't pursue it. I don't know. But when I find him scoffing at

these things in the House, Mr. Speaker, I find it curious. I find it

curious, indeed.

So let's have a look at what the new government has done. That was

our record between October, when the anti-inflation programme was

introduced in Ottawa, and the time when we handed over the reins of

government to the new administration. That was the performance.

Mr. Speaker, ICBC seems to be doing pretty well financially when

they can make a loan of $181 million to the provincial government the

day after they receive it from the government at 10 per cent interest

rates.

AN HON. MEMBER: On the same day.

MR. KING: Yes, the same day. So I say, Mr. Speaker, that I

think Major Douglas is not dead yet. We've got some funny-money

adherents left in the Social Credit ranks yet when that kind of

financial transaction can take place in 1976. Major Douglas is

[ Page 1639 ]

not dead by any means. The old A plus B financial theory is now

being accepted by the dissident Liberals in the Social Credit coalition

caucus. Would you believe it?

Interjections.

MR. KING: Mr. Speaker, the cabinet is becoming exercised

because they know that I have dealt with the NDP record in October of

last year, and they don't want to hear me deal with what has occurred

since. But I am going to plough ahead, Mr. Speaker, despite all the

interruptions and the catcalls. Doggedly I will stick to my direction,

Mr. Speaker; with your help I shall get my story across.

Interjections.

MR. SPEAKER: Order, please! The hon. Leader of the Opposition has the floor.

MR. KING: What has the Social Credit Party — the coalition party, Mr. Speaker — done since assuming office?

They increased automobile insurance anywhere from 100 per cent to

400 per cent and promised to let the U.S. insurance industry back in

the field. This paid off campaign debts, I suppose, to the insurance

industry that had developed during the last election.

They increased electricity and natural gas rates by an average of 12

per cent. They allowed an increase in home heating oil of 4.54 cents

per gallon. This is a start, I presume, Mr. Speaker, to repay the oil

companies for their campaign funds which they made available to the

coalition during the last election. They eliminated the price freeze on

propane and gasoline.

They allowed an increase in the allowance for residential rents from

8 to 10.6 per cent. They cancelled the plan to introduce rent control

on commercial premises. This meant a consequent increase in the cost of

doing business to small enterprise in this province, which they

naturally pass on to the consumer.

The coalition eliminated the price freeze on food, on drugs and on beverages. They allowed price increases on bread and milk.

They have indicated and since carried it out that increases are

coming on the ferry rates. They have announced them now; they are

excessive — double and in some cases triple. Bus fares, freight rates

and gasoline are up.

The Premier is openly advocating that the cost of petroleum products

accelerate to the world market price, which again, Mr. Speaker, is

going to impose additional burdens on the cost of living in British

Columbia.

During the budget this year they increased personal income tax, they

increased the sales tax, they increased hospital co-insurance, they

increased medicare premiums, they increased the cigarette and tobacco

tax.

I say, Mr. Speaker, that all of these things taken together display

a complete insensitivity to the needs of people in this province. They

have imposed just a fantastic cost burden increase on virtually every

citizen since coming to office. They are obsessed with bottom-line

economics. They are obsessed, apparently, with allowing their friends

in industry to have their profits accelerate and possibly return

favours that have been transmitted to them in the past.

These things, Mr. Speaker, tell a sorry story in terms of the

government even attempting to portray an even-handed approach to coming

to grips and fighting this problem of inflation.

It gives no encouragement, no inducement, no satisfaction to people

throughout the province that this government is even serious about or

sensitive to the need to demonstrate some equity — some even-handed,

judicious approach to calling upon all people in the province to bear

their weight in terms of fighting inflation. Rather, we have come to

expect from this government and other governments of the same stripe

that they thrust all the burden upon those who can least afford to pay,

Mr. Speaker. It is not only a matter of that, it has the effect also

of....

Interjection.

MR. KING: Oh, listen to the "member for Hawaii" down there;

Mr. Peanuts is at it again, Mr. Speaker. Mr. Peanuts is at it again. I

think he knows all about the small businesses that are in trouble but

he is very vocal here today. Perhaps he would be better advised to

spend more time giving the advice that he is screaming across the floor

to the administration of his own businesses. Perhaps he'd be more

successful. He seems to have a lot of problems, Mr. Speaker.

Interjections.

MR. KING: I've talked about the inequity of the programme.

I've talked about the unconscionable rate increases that have been

introduced by this government over the past five months that they have

been in office. And the Premier (Hon. Mr. Bennett) seems to be a little

deficient in his arithmetic. They've been there five months now, not

four, and I think with all the beautiful promises they made of doing

amazing things and really strengthening the economy of this province, I

find it bemusing now to hear him saying: "Well, we can't do much. Maybe

three years from now we'll be able to do a little bit. We've only been

here three months, four months."

[ Page 1640 ]

The people of this province elected you to govern, because you said

you had the ability, and I don't think they're going to accept some

prophetic cry now that you haven't been there long enough to come to

grips with the problems that confront the province.

So it's about time you got off that kick, Mr. Premier, and started

to demonstrate that you have some policies other than punishing people,

that you have something in mind to ease the burden of unemployment, to

ease the increased cost burden on people, and to get the economy of

this province going again.

[Mr. Veitch in the chair]

HON. W.R. BENNETT (Premier): Are you against the bill?

MR. KING: Mr. Speaker, I have mentioned that the burdens of

the bill, the burdens of the programme, fall heavily upon senior

citizens, upon the unorganized, upon the working poor, upon organized

workers, and upon 110,000 citizens in B.C. who are now unemployed. At

least 110,000. And once the new government policy is complete, Mr.

Speaker, of laying off 450 ferry employees, without apparently any

intention of considering an attrition approach or severance allowance

or relocation, when they have finished their policy of their Crown

corporation laying off 1,100 or 1,200 workers from the British Columbia

Railway, we are looking at about 114,000 British Columbians who have no

job at all.

AN HON. MEMBER: I bet he doesn't even speak on the bill.

MR. KING: And yet, Mr. Speaker...

AN HON. MEMBER: I bet you he doesn't.

MR. G.R. LEA (Prince Rupert): How much?

MR. SPEAKER: Order, please!

MR. KING: ...the record is clear. The tremendous impact, the

unconscionable, insensitive increase in costs that this government has

visited upon all these people, is going to be a millstone around the

neck of the people of B.C. for the rest of this year and probably in

years to come.

I want to say to the government, in all seriousness, that there's

more than one way to prime the economic pump in this province. You

know, the old economic theory that you subsidize and ease off on

taxation to industry is not the only way. When you have 114,000 British

Columbians unemployed, you're removing from the economy of this

province a tremendous ability to affect the demand for goods — and

consequently the restraint and the negative effect upon the basic

fundamental economy of the province is tremendous.

AN HON. MEMBER: What did you do when you were in power?

MR. KING: It seems to me.... Well, I can tell you, Mr.

Speaker, that we never had 114,000 people unemployed at one time. I can

tell you that we had unemployment....

Interjections.

MR. SPEAKER: Order!

AN HON. MEMBER: Let me walk around my chair, Mr. Speaker.

MR. KING: They asked me a question, Mr. Speaker, and then

they all break out like a gang of jackals with catcalls. I hope they'll

listen. They asked me a question; I'm happy to respond.

Interjections.

MR. KING: They ask what we did. I'm willing to tell you. We

poured $20 million into special employment for students in British

Columbia, which this government has cut back 60 per cent.

AN HON. MEMBER: You sure poured it.

MR. KING: In the creation of jobs; that's right, and I tell

you, the young people of this province, the university and high school

students, are going to give you the message about what they thought

about that programme, because there's no work for them this year, no

work at all. I don't think they can even get a job in the Bennett

hardware chain. They're out in the cold, and the future education, the

continuing education, is jeopardized through that government's

inability to recognize the problem.

That's the kind of thing we did. We initiated a special employment

programme in the forest industry, in collaboration with industry. We

did positive things, and the employment rate was never as high, under

our administration, as it is today.

But rather than positive steps calculated to assuage this hardship,

what we see by the present government is the layoffs, the mass layoffs

of additional British Columbians. I question the wisdom of that move by

any standard, Mr. Speaker. There's no wisdom in it. It's insensitive,

it's cold and it's punitive against average British Columbians.

AN HON. MEMBER: No guts for debate.

[ Page 1641 ]

MR. KING: Now we've talked about what has happened to the

cost of foodstuffs. It's obvious that a number of moves undertaken by

the government in terms of the increase in transportation rates are

going to further affect the accelerating cost of foodstuffs. Food

cannot be transported to the islands, to Vancouver Island, the Gulf

Islands and the northern coastal area, at double the freight rates

charged on the B.C. Ferry system — where a lot of them are still

transported; it's not all by private carrier — without a cost impact

being passed on to the consumers in those areas. It's impossible.

So the people are not only facing double and triple increases to

travel to Vancouver for medical attention which they must do

occasionally — the kind of sophisticated facilities they need for

medical and dental work — but for a variety of other business

functions; commuting for work. They're not only going to meet the

increased costs of those rate increases, but they are at the same time

going to face escalating costs for the commodities they must use to

live because the carrier is going to be passing on to them — the

consumers — the increased freight rates that he is facing too. This is

a terrible record, Mr. Speaker, just an absolutely terrible record.

The member for Comox (Ms. Sanford) talked about what has happened in

terms of the cost-of-living increases. As I said earlier, the

Statistics Canada revelations in recent weeks have demonstrated beyond

any argument, beyond any debate whatsoever, that this is actually

occurring, that the general cost of living in the Vancouver area has

escalated to the point where the average British Columbia family now,

as a direct result of all the cost increases brought in by this

government, is facing an increased outlay of capital each year of a

minimum of $850 — a minimum of $850 — and yet the government suggests

to us that we should support a bill such as Bill 16 which does nothing

but grind away in a heavy-handed fashion even more sanctions on that

very same group which is suffering the most.

There is nothing at all to regulate banks, nothing at all to

regulate interest rates, nothing at all to regulate profits. There's

the power to do something, yes, but why is it that the precise formula

is laid out for wages — 8 per cent this year reducing to 6 per cent

next year and 4 per cent the year after that — but there is nothing

about corporate profits, nothing about executive salaries, nothing

about legal fees, nothing about dental fees or doctors' fees? They're

the most complicated things to try to control, and if this government

was serious about doing something, they would have brought in a bill

that said precisely that when your income exceeds X dollars, then there

will be a negative income tax to recover that so the people of British

Columbia can be assured that everyone is making a sacrifice and packing

an equal burden in terms of any attack on inflation. No such thing in

the bill. It's a one-sided, heavy-handed, inequitable attack on working

people and low-income earners. That's what it is.

What about advertising? They talk about the psychology of inflation.

They talk about cost-push and demand-pull inflation. What about the

advertising industry? What's productive about the advertising

industry? What does that add? What does it contribute to the gross

national product of this province or this nation? I say to you, Mr.

Speaker, exactly zero — exactly zero! What it does, though...

Interjections.

MR. KING: ...is heat the fires of inflation. It entices

working people, young people, to buy luxury commodities that they can't

afford. It inveigles them into mortgages and loans at interest rates

they can't afford simply because, through advertising in the media, the

average guy today is not swinging unless he has a boat and unless he

has a red roadster all sold with the use of sex symbols and so on,

enticing people to buy more than they can afford — to overextend

themselves in terms of credit. There's not a thing here about doing

anything to dampen the advertising industry's lure to people to put

more demands on the economy that can really be afforded — not a thing.

I say to you, Mr. Speaker, that that whole service is completely

unproductive in terms of adding anything concrete to the gross national

product, either in this province or in this nation.

Mr. Speaker, I think we should have a debate in this House sometime

about disparity in our society and in our economy. I think we should

have that debate. I think we should talk about the disparity in wage

rates, and there is disparity through the collective bargaining

process. That's one of the imperfections of it. In the unorganized

sector, certainly there's disparity there. People are very inclined to

highlight and point to these things as reasons that trade unions are

not very socially responsible, but isn't it about time we put the whole

thing in proper context and talked about the real disparities, the real

values of functions in society?

I think the government perhaps has been remiss in not introducing a

bill that would come to grips with these problems. What is the

executive worth today? Is the MacMillan Bloedel executive worth what

they are reported to be receiving recently in newspaper articles? "MB

Executives' Pay Tops $2 Million." J.V. Clyne and Robert Bonner: I think

the government knows those people, Mr. Speaker. I think they know who

they are.

I want to just read some of the articles concerning executives' salaries.

AN HON. MEMBER: Who went to China?

[ Page 1642 ]

MR. KING: Are you defending these salaries? Well, not Bonner

and not Clyne; not Bonnie and Clyde, not Bonner and Clyne. This is an

article by George Froehlich.

Interjection.

MR. KING: Mr. Speaker, let's have a look at this article. The

government doesn't want to hear it. It's an

article by George Froehlich

in the Sun of April 2, 1976:

"The former president of MacMillan Bloedel Ltd., Dennis

Timmis, and Chairman George Currie received yearly salaries of $166,667 and

$137,424 respectively in 1974, a year in which the giant forest products

company showed a profit of $72.3 million.

"The salaries of Timmis, Currie and other key MB executives

are contained in a report filed with the central U.S. securities regulatory

agency, the Securities and Exchange Commission in Washington, D.C."

We couldn't find that out in B.C. here. We had to go to Washington to find out what the salaries are of B.C. executives.

"The report is required of all companies publicly trading in the U.S. and gives a detailed account of a company's operation.

"Salary figures for 1975 when MacMillan Bloedel

recorded its first loss of $ 18.9 million will not be available for

some time. However, it is not unreasonable to assume that Currie's and

Timmis' salaries would have increased, even though Timmis in a letter

to salaried employees dated last November 24 said the top executives

were taking a 10 per cent pay cut in view of the losses the company was

showing.

"Last Friday in a sudden move Currie and Timmis lost

their jobs after an MB directors meeting. Although companies never

reveal the severance pay top executives receive, it is standard

practice to pay at least a year's salary. The reports also reveal the

salaries of other top MB executives; for example, J.V. Clyne, former MB

chairman and chief executive officer, received a basic salary of

$100,000 and $25,000 bonus in 1974. Clyne is still a company director.

"Other 1974 salaries for key MB executives were as follows:

L.G. Harris, executive vice-president, $98,334; J.O. Hemmingsen, executive

vice-president, $98,334; Anson Brooks, president of Powell River Alberni Sales

Corp., a subsidiary, $54,416."

And on it goes. Now what's going to be done, Mr. Speaker, to make some

assessment of the sacrifice that MacMillan Bloedel executives may be called

upon to make in this government's fight on inflation in this province?

What is going to be done, Mr. Speaker, by this government that says they are serious about fighting inflation...

MR. LEA: They'll only allow them a 50-cent increase.

MR. KING: ...to determine the executive salaries of CP Rail

subsidiaries in this province — Cominco, that struggling little free

enterprise group up in the Kootenays? What are they going to do about

even finding out how much money these executive people are receiving?

They had to find out what Mac and Blo people are receiving, even though

they appear to be close political friends, from the Securities Exchange

Commission in the United States.

I say in all seriousness, Mr. Speaker, that if this government is

going to sell a bill of goods to the people of this province and tell

them with any degree of sincerity that, "yes, we're serious about an

even-handed attack on inflation," they had better start telling us.

They had better put in the bill precisely the mechanism they intend to

use to regulate the excessive disparity that exists between MacMillan

Bloedel's top executives and those people that have had their Mincome

cut under the compassionate hand of the new Minister of Human Resources

in the past few months.

I can read the legislation, Mr. Speaker, and I see no formula. I see

a power vested in the government — a power that, by the Premier's own

admission, they have already held and refused to exercise. Except in

the one, single case of gas prices they have refused to exercise it.

So what comfort, what assurance can we in the official opposition

possibly have that this gang of coalition boys over here is prepared to

take on and regulate their friends in the corporate ivory towers of

this province? I don't believe it, because if you were serious it would

be in the legislation, and it would be precise and it would be

mandatory. It wouldn't be the offer of some review a year after the

fact somewhere down the line after the people have been suffering wage

restraint, increased prices, increased food costs and trying to live

with that kind of situation all during the year.

It's classically inequitable, classically inappropriate and unfair,

one-sided legislation, Mr. Speaker. Certainly, I can't subscribe to

that kind of approach to what should be a unanimous and a consensus

attack — an approach to not only controlling inflation but seriously

coming to grips with some of the disparities that have beset our nation.

I've talked about corporate salaries. It's fashionable to get on the

hotline shows and talk about the disparity and anomalies that exist

between the cashier in the food market and the guy who's out in the

basic industry cutting our trees and digging our

[ Page 1643 ]

minerals — and wringing our hands saying: "Well, my goodness, that

cashier is getting as much or more than the industrial worker." We

ought to do something about that in a legislative way.

I've heard government backbenchers espousing and mouthing that kind

of cliche, that kind of superficial assessment of the ills of our

society. I say, fine, but if that's what to do and if you're serious

about it, then let's have some reappraisal of the worth and value of

functions in our society. Let's seek out the real anomalies and the

real discrepancies and disparities where they exist in exaggerated

proportions. And I have outlined some. How do you justify J.V. Clyne

sitting there with a salary of hundreds of thousands of dollars a year

while some poor widow with a family is trying to feed her family,

trying to meet the rent increases that you have visited upon her,

trying to accommodate the home heating fuel cost increases, trying to

accommodate increased ferry fares?

MR. L.B. KAHL (Esquimalt): Is that why you raised your salary 100 per cent when you were a cabinet minister?

MR. LEA: You raised yours 100 per cent when you came in here.

MR. KING: That's right. In terms of any value, I would agree

with the member for Prince Rupert. I suggest, Mr. Speaker, that in

terms of our salaries...fine, let's throw that into the hopper too — I

don't mind an assessment. I don't mind a public assessment of the value

of MLAs — not a bit!

Interjections.

DEPUTY SPEAKER: Order, please!

MR. KING: Mr. Speaker, I think this might be a good thing.

Really, in terms of some of the government politicians, if there ever

is any realistic appraisal of the value of their function, perhaps we

will end up with a greater number in this House than we already have at

the moment. It might be a bit of a threatening thing in terms of the

government's back bench, Mr. Speaker.

But that's a bit of a red herring. I think we should talk about

disparities. Can we sit comfortably by when I've talked about

advertising inducing and enticing people to buy more than they can

afford — an unproductive industry that contributes nothing to the gross

national product, the real wealth of this nation? Can we sit idly by

and zero in on the discrepancy between the cashier and the logger when

the hotliner is making $200,000 a year, when the athlete is commanding

salaries of $4 million? Perhaps it is time we took a serious look at

the value judgments we make in our society. Maybe these are things that

we should be doing.

But I see no initiative, Mr. Speaker, and I see no direction, no

indication that this government is prepared to do anything to rock the

boat in terms of the status quo powerbrokers. They are willing to heap

additional burden, anguish and pain upon the people who can least

afford it. But don't touch the guys who are in power, the elite in this

province. Not a darned thing there — not a thing to regulate their

freedom to ever and increasingly accelerate their recompense,

regardless of the value of the function. Not one.

Mr. Speaker, I think I've given a pretty clear indication that our

party cannot subscribe to a bill such as this, one that is eminently

one-sided, that, in my view, is destined for failure because it can

never attain the kind of provincial consensus that is needed to

effectively fight inflation in this province.

It can never effectively persuade the people whose cooperation

government must have that there is an even-handed approach, that there

is a fair mechanism which calls upon everyone to sacrifice with some

degree of equality, and, therefore, Mr. Speaker, I see the bill as

being nothing but inflammatory. It's going to create confrontation,

it's going to create distrust of the government's motives, and it's

going to impair the ability of this province to play their

part in

doing something effective about dampening the fires of inflation.

Our party are willing to consider, willing to debate and willing to

assist in a proper attack on inflation. We are willing to debate and

we are willing to participate in some realistic and some meaningful

assessment of why the free market system is in trouble in this nation

today, and to consider some answers to that, whether it be investment

policies, whether it be income policies, whether it be pricing policies.

But we say to this House, Mr. Speaker, and we say it clearly and

unequivocally, that we cannot, in good conscience, participate in, or

give approval to, or sanction, an approach that is once again a classic

sell-out to the powerful in this province at the expense of those who

can least afford to pay.

We cannot lend our support as we would like to have done to a

programme which is so classically and patently inequitable, not only in

light of the absence in the legislation of precise and specific

mechanisms to spell out how the government will come to grips with

these many areas, these many gaps that we have talked about.

We must indicate very clearly, Mr. Speaker, that as long as those

gaps exist, and so long as the government pursues the direction which

they have taken in increasing virtually every area of social and public

services which the people of the province must rely upon for their very

existence, that we can have no trust in the government's dedication and

in their sincerity to embark upon a fair, even-handed,

[ Page 1644 ]

equitable approach to this problem of inflation.

Accordingly, Mr. Speaker, while condemning their conduct, while

condemning their performance in the strongest possible way, and

certainly condemning the legislation for the omissions it contains, I

must state to the House that there is no way the official opposition

can support this bill.

Rather regrettably, Mr. Speaker, I must say that the province has

lost an effective chance to participate in a meaningful way in a

programme that could have been accepted, and could have been effective

in dealing with the national problem of inflation in Canada and in B.C.

Thank you, Mr. Speaker.

HON. MR. BENNETT: On a point of order. Would the Leader of

the Opposition table the material that he quoted from as has been the

custom in the House? Give me the dates.

MR. KING: I'd just like some explanation from the Premier on

what he would like tabled. I'm quite prepared to table the things I

referred to — I'm not sure whether I referred to them all.

HON. MR. BENNETT: Just what you quoted.

MR. KING: All right, well, there's one other that I just

quoted from briefly, and perhaps I could read it into the record of the

House before I table it. It's a final point before I sit down, Mr.

Speaker, since I have the floor again.

Interjections.

MR. KING: It's a letter — really I think this should be brought to the attention of the House, and I promise to table it, Mr. Speaker.

SOME HON. MEMBERS: Do it by leave.

MR. KING: I'm sure the House will grant leave.

SOME HON. MEMBERS: Try it! Try it!

DEPUTY SPEAKER: Shall leave be granted?

SOME HON. MEMBERS: Aye.

MR. KING: There, that's the kind of friendly atmosphere I like.

Mr. Speaker, this is a letter that I think I should quote because

it's a matter of great consternation to me, and it was a point I

neglected to mention.

It's a letter from the firm of Stevenson and Kellogg Ltd.,

management consultants, and it's directed to Mr. W.F. King, Executive

Vice-president, British Columbia Railway Company, 1095 West Pender Street, Vancouver, B.C., and it came to my hands — I don't

know why — but I have a copy of it. It's dated March 24, 1976, and it

says: "Dear Mr. King...." And I'm not W.F. King, I'm W.S. King.

"Anti-inflation legislation has raised difficult and

complex questions for all organizations affected. Wage guidelines will

also have far-reaching implications for those not yet affected.

"You may be concerned about questions such as these.

How many groups should you have for ease of reporting on one hand and

greatest flexibility in adjusting salaries on the other? How do you use

increments under the new guidelines? Should you establish a new

classification programme or revise your existing programme to work

within the guidelines? Should it be done now or in a later guideline

year? In what way can you reward employees for outstanding performance

under the guidelines? What do you pay on entry of new employees? What

is the best policy to follow on promotions under the guidelines?

"These are the kinds of questions we have been

studying, since a large number of organizations rely on our annual

surveys and salary programmes in administering their compensation. We

are combining this experience with current information from the

Anti-Inflation Board to assist our clients.

"If these and similar questions are of concern to you,

or if you feel that your salaries require study, we would be pleased to

discuss your needs without obligation. Please feel free to call us.

(Signed)

Ian G. King,

Vice-president."

There are a lot of Kings involved in this thing — no relation to me.

I want to say, Mr. Speaker, that this letter, directed to the

executive vice-president of the British Columbia Railway, is of real

concern to me. This is a group of management consultants that are

willing to go in and counsel the management of B.C. Rail, a Crown

corporation, on how they can perhaps bend some of the guidelines under

the anti-inflation programme and escape any restraints on executive

salaries. I want to say that I hope it is not the government's policy

to allow Crown corporations to employ management consultants to escape

any control and regulation when they have a bill before this House that

commits all of the public-sector employees to the stringent application

of wage restraint under the federal programme. This kind of thing is

going on. It finally and conclusively confirms the statement made by

Jean-Luc Pepin, the chairman of the Anti-Inflation Board, when he said:

"There are

[ Page 1645 ]

111 ways, for management to escape the regulation of the anti-inflation programme."

AN HON. MEMBER: More!

MR. KING: Do you want me to speak some more? All right, I'll table it. I'll get up and make another speech, if you wish.

MR. G.F. GIBSON (North Vancouver–Capilano): I just wonder if the Premier has any more points of order before we go ahead.

Mr. Speaker, commenting briefly on what the two previous speakers have said,

the Minister of Finance, in introducing this legislation, stated that it has

two main objectives. I hope I am quoting him correctly: first of all, to enter

into an agreement with Ottawa for the regulation of certain charges in the public

sector; secondly, to authorize a very sweeping form of provincial control.

The first

section I think any reasonable person would agree with.

The second

section is very, very worrisome, so much so that I think

this Act is incorrectly named. It is called the Anti-Inflation Measures

Act; I think it ought to be called the Arbitrary Measures Act, because

it does go just that distance.

The Minister of Finance in opening debate stated that it is the

responsibility of provincial governments to practise restraint. He

suggested that that was an important component of the fight against

inflation. Mr. Speaker, if that's the case, why are budgetary items on

ordinary account up 16 per cent this year? Why is the Crown provincial

taking $1 billion more out of the economy of British Columbia than it

was last year when you add in the ICBC charges and the ferry charges

and the tax increases?

The Premier is shaking his head; he can't do simple sums. Add it up,

Mr. Premier; it's there. There's over $600 million on straight taxation

account, and you know that — from $2.9 billion revenue to $3.6 billion

revenue. There is about $700 million right there. Add in your

additional ICBC charges, your additional ferry charges and your

increases in the B.C. Hydro account, and it comes to over $1 billion

more taken out of the pocket of the taxpayer in this province by the

Crown this year.

HON. MR. BENNETT: Where does the deficit come from?

MR. GIBSON: I don't know where the Premier studied finance; I

don't think he did. The deficit is spread over a number of years, Mr.

Premier. You're not paying it off this year, are you? You're spreading

it over a number of years.

In any event, the point I'm trying to make is that this has not been

a year of restraint for this government, no matter how much they want

to talk. What was that the Neale Adams column said in The Vancouver Sun the other night? Just so far, $870 more per family is being extracted by this government. I don't call that restraint.

The minister went on to say that there must be price increases where

necessary. He should have put in parentheses: (That means we can raise

our prices but nobody else can.) Nobody else can raise their wages very

much either.

Then he said that it was his proposal and his intention under this

legislation to refer to the AIB all public-sector wage agreements since

October 14. Well now, that's fair enough on one side, Mr. Speaker, but

did he go on to say anything about public-sector price increases to be

referred to the AIB? I didn't hear that side of it. I heard the wage

side being referred to, but not the price side. No, sir, they

overlooked that one. How about that major price increase of the 2 per

cent sales tax? That's the most inflationary single thing this

government has yet done, tremendously inflationary — well over 1 per

cent in the cost of living, Mr. Premier and Mr. Minister, and you know

it! You are not going to refer that one to the AIB, are you? You betcha

you aren't!

Then we come to the comments of the Leader of the Opposition (Mr.

King). Now I know that the government disagrees with a lot of things

that the official opposition stands for. But they would have been wise

to listen to some of the things that were being said there, because,

whether the government likes it or not, there is a widespread

perception of unfairness about the discrepancy in incomes in our

society. I don't have the answer to that, any more than I think anyone

in this chamber does, but let's for God's sake exhibit some sensitivity

to it and address ourselves to the question of making it better rather

than simply ignoring it, as the government chooses to do.

Now I agree as well with many of the concerns of the hon. Leader of

the Opposition concerning the federal anti-inflation programme, but

that's not the main thrust of this bill, I submit, Mr. Speaker. For

example, one thing I have to differ with him a little bit on is the

question of the ability of professionals, for example, by doing more

work in a given year, under the AIB programme, to earn more money. The

Leader of the Opposition seemed to be suggesting that that kind of

activity should be penalized. I don't think it should. I think that

where there is additional productivity in our economy, it should be

rewarded, not penalized, because productivity is going to be our only

salvation in this inflation problem in our country, and we have to find

some way of moving the incentive on to other working people as well.

MR. D.G. COCKE (New Westminster): The productivity goes right up the line, Gordon.

[ Page 1646 ]

MR. GIBSON: You have to reward productivity everywhere —

that's my point — not just in this one group. You have to reward it

right across the board, and that's what the guidelines should take into

account.

I would say, Mr. Member, that applies to investment capital as well.

We have to reward productivity there, not the kind of windfall things

that a lot of us often worry about in this House, but investment

capital that leads to productivity; we must reward that. I very much

hope that the upcoming federal budget is going to make some changes in

the existing AIB programme and take those things specifically into

account.

I cannot go along with the Leader of the Opposition's general

rejection of federal controls. The thrust, I submit, Mr. Speaker,

should be to find ways to improve those controls, not to reject them.

Canada cannot afford to have that control system falter, and especially

B.C. cannot. There are some things that could be corrected — the profit

regulation, as a device, is too slow and cumbersome as compared to a

direct regulation of the prices of key commodities, and has less of an

appearance of fairness. These may be the kinds of things that will be

corrected.

Now moving on from that rebuttal to some comments on the bill

itself, I think that every member in this House is probably united on

the basic concept that we must do what we can to fight inflation. You

know, inflation is the kind of thing that rewards some and takes away

from others, and not in proportion to their needs or necessarily their

merits.

I went to the Bible for a description of this, and it is in Matthew

25, verse 29. You may recall this: "For unto everyone that hath shall

be given, and he shall have abundance: but from him that hath not, it

shall be taken away, even that which he hath. And cast ye the

unprofitable servant into the outer darkness...."

Unfortunately, Mr. Speaker, inflation regards those who have not as

being the unprofitable servant. It is tax on the poor, above all. It is

a tax on the powerless. Those people in our society without power,

without capital, are those that suffer most and most quickly from the

ravages of inflation.

There's a special impact on the British Columbia economy. As the

Minister of Finance well knows, we make our living on the world market.

We have to export our product, and we can only export so long as our

costs remain in line. Our costs have been going up very quickly in

British Columbia. Theoretically, this should be cushioned by the fact

that the Canadian dollar is floating. But, in fact, British Columbia is

such a small part of the Canadian economy that our particular costs and

export requirements do not govern the floating value of the Canadian

dollar, so it's been staying at a very high level, and that means....

MR. LOEWEN: Our Canadian dollar is sinking, not floating.

MR. GIBSON: Well, no, it's not sinking, Mr. Member. It's

floating at a very high rate, at an artificially high rate caused by

the fact that there have been tremendous bond issues in the United

States in the first quarter of this year. I think it should be 10 cents

lower or more, from the point of view of the British Columbia economy.

MR. LOEWEN: Are you predicting that federally?

MR. GIBSON: I'm not predicting anything, Mr. Member.

AN HON. MEMBER: I am.

Interjection.

MR. GIBSON: Yes, but you know more about the revenues of the province than the federal revenues, Mr. Minister.

AN HON. MEMBER: I'm predicting it federally.

Interjection.

MR. GIBSON: What I'm saying is that it would be nice if we

had control in British Columbia over the value of our dollar, but we

don't. Therefore what inflation does to us is drive our costs up to a

point where we cease to be competitive and we have the kind of

situation today where we see the Forestry department announcing a

relaxation in the close utilization standards on wood which means that

we are having to move a little bit down the line towards high-grading

our forests, a little bit back from exploitation of the more and more

marginal stands of timber, which means that there's a little bit less

employment that we can support in that particular industry in British

Columbia. That's what inflation does. It very gradually and slowly and

insidiously prices you out of the market. We can't afford that in

British Columbia because we do not have an internally self-sufficient

market. We must live by selling our productivity to others.

AN HON. MEMBER: Hear, hear!

MR. GIBSON: So, Mr. Speaker, there can be no doubt about it:

these controls must work for the benefit of British Columbia, and our

thrust has to be how to make them work better.

Now let's look for a moment at the engines of the current phase of

inflation we're going through. One of the previous speakers referred to

those two things, demand-pull and cost-push, demand-pull being the

classical kind of inflation of too much money chasing

[ Page 1647 ]

too few goods, for one reason or another, and cost-push being where

the inflexibility of all the cost pressures and the upward thrust of

all those cost pressures, be they the cost of capital or the cost of

wages or the cost of resource rents, whatever it may be, go only up

and keep going up year after year.

Those are two of the elements and, of the two, I am of the opinion

that recently cost-push has been the more important. But there's a

third factor that's not often talked about or recognized, and that is

the actions of government. By that I mean things like the 2 per cent

tax that I mentioned before. By that I mean things like the excessive

and continued co-option by governments at all levels in this country of

the resources of this country into increasingly less productive

functions — and again that simple equation: as productivity comes down,

the value of your dollar has to go down with it. By that I mean things

like the money supply which is finally being handled in a more tightly

reined way by the Bank of Canada but has, up until now, had an awful

lot to do with the inflationary cycle we're in.

MR. LOEWEN: You tell the people in Ottawa.

MR. GIBSON: So a gradual consensus formed in this country,

Mr. Speaker, and Ottawa moved. Controls were put in place, and they're

working after a fashion. We'd all like to see them work better, but

they're working. The evidence of the last two or three months, while

it's still too short term to draw any cheerful conclusions from, is at

least not going in the wrong direction in terms of the consumer price

index.

The pattern of price increases in the non-food sector is still

uncomfortably high and, in my opinion, the AIB has to move into more

direct controls over prices. The pattern of wage settlements, on the

average, is not yet consistent with a long-term 8 per cent level of

inflation, which is the federal government's target for this year, but

nevertheless it's going in that direction.

The only loophole that was left across the country and generally

plugged across the country, except for British Columbia — and I think

Saskatchewan was the other the minister mentioned — was that of

provincial Crown agency employees. This loophole, Mr. Speaker, could

have been covered in several ways. It could have been covered by the

execution of orders-in-council perhaps, as other provinces have

proceeded. It could have been covered, in terms of the government's own

employees, by a simple resolution that the provincial government was

going to proceed in that way and follow the federal guidelines. It

could equally have been covered in the area of Crown agencies and Crown

corporations by directives from the government to go on that line.

Interjection.

MR. GIBSON: Well, that's exactly my point, Mr. Minister; I'm

looking for the reason for this bill. Because if that desirable

achievement can be reached, namely the effective bringing of provincial

public sector employees under the general ambit of the AIB guidelines —

no matter who administers it directly, whether it's directly

administered by the Crown provincial or by the federal AIB — if that

can be achieved, that to me achieves all of the desirable purpose of

this bill. What's left is thoroughly undesirable.

If the government really wants a piece of blank-cheque legislation,

which is what all of this bill after

section 5 is composed of, then I

have to say I disagree with that. Up to

section 5 it's not so bad,

although there are deficiencies. The definition section, for example,

is very deficient. It doesn't define what a "service" is, but I think

we all know what a "service" is. A "service" is a wage. That's what

they're getting at there.

They didn't want to use the words "wage control" in the bill, but

that's what the bill does. I think it's shocking that they didn't come

out and admit that. I guess they think you can do wonderful things with

words. If you keep saying something long enough people will believe it.

The inquiries

section of the bill is reasonable, the abilities to

inquire into various prices and get papers and records and so on.

Then we come to this blank cheque,

section No. 6, which gives

enormous powers to the government arbitrarily and at any time to freeze

prices — or, more than that, to establish prices, presumably not just

to freeze them, but to lower them, to roll them back.

Section 6(

b) establishes the maximum price that may be charged for the supply of a

commodity or service — and that done, Mr. Speaker, by regulation with

the provision that this may be referred to the Legislative Assembly at

the next sitting within 60 days. But a lot of damage can be done by

that time. Besides which, of course, the majority of the government at

the next sitting would simply confirm what they had done anyway. That's

a nice piece of window-dressing but it doesn't do much more than that.

There are just absolutely astonishing powers, Mr. Speaker, powers to

intervene anywhere in the economy, powers to intervene in existing

contracts as nearly as I can see, powers to freeze wages or roll back

wages, powers to freeze prices or roll back prices, powers to alter

existing agreements. All of this is by cabinet regulation. It's plain.

It's written there.

Mr. Speaker, governments should not have those kinds of powers

except for the regulation of monopolies or other uncompetitive

situations or except in times of emergency. Even in times of emergency

those powers should be very carefully surrounded with checks and

balances.

This government is saying "Trust us." Mr. Speaker,

[ Page 1648 ]

I don't trust any government. The government calls the people in the

official opposition socialists. What do they say about this measure

that intrudes more deeply in the economy than, I must say, any measure

I saw proposed to this House by the previous government? What do they

call it? There's not anybody in the government back bench, I think,

that's going to have the gall to stand up and say, "It's a free

marketplace bill," because it sure isn't. It's a very, very serious

arrogation of powers under the government and, as I say, I do not trust

any government unless they are surrounded by far more effective checks

and balances than appear in this bill.

Why do they want any price-control power at all once the emergency

period's over, Mr. Speaker? Why is that necessary? Once the inflation

crisis in Canada is cooled down, why does this government want powers

to dig that deeply into the economy? We've heard not a word of

explanation on that from the minister.

It's inexplicable. It's simply, as I said before, a piece of

blank-cheque legislation that gives unnecessary power. Is this going to

be the basis for the machinery that will have to be put in place once

the agreement with the federal government expires next April, as both

the minister and the Premier have foreshadowed? If that is to be the

basis, what is the precise nature of the machinery that will be put in

place? Will it simply be a group of faceless bureaucrats who will look

as they wish at the labour rates and the price rates set in the

marketplace of this province and say: "That is right and that is wrong"

and "Here, cabinet, is what you should do about putting the world back

in order again"? Is it going to be like that? Will there be any appeal

mechanism? There's no mention in here of an appeal mechanism. That is a

basic fundamental of any piece of administrative machinery that should

be written into legislation, not assumed by regulation.

There are no due-process provisions, no provisions for the right to

be heard by anyone who might have a complaint against the way in which

their wages — services, as the bill euphemistically calls it — or prices

might be frozen, no right of redress of any kind whatsoever.

Mr. Speaker, that's why I call it the "Arbitrary Measures Act" not the Anti-Inflation Measures Act. On the basis of all this:

(1) Inflation must be fought.

(2) The federal government is doing something about it

and we have to do something about it, and we have to do what we can to make

that work.

(3) Other means exist, other than this legislation — or

else more moderate legislation is a possibility — of cooperating with the federal

government in terms of the public sector of British Columbia.

(4) Since the bill takes unto the government, and asks

this House for, the delegation of powers which, in my view, are completely inconsistent

with the democratic way of doing things and the way our economy operates.

For all of those reasons and, as the previous speaker said, with

genuine regret I have to say that I will be voting against this bill;

and I will be opposing it in committee, in particular on those

thoroughly objectionable sections.

Mr. Speaker, with that I will sit down, except at this point I will notice the lack of a quorum.

MR. W. DAVIDSON (Delta): With leave of the House, and with

the cooperation of the hon. leader of the Conservative Party (Mr.

Wallace), I would like to now introduce from the gallery several grade

11 social studies students from Delta Senior Secondary School in

Ladner. I would ask the House to make them welcome this afternoon.

Leave granted.

MR. G.S. WALLACE (Oak Bay): Mr. Speaker, speaking to the

principle of Bill 16, the Anti-Inflation Measures Act, I'd like to

start by referring to the two main points which the Minister of Finance

mentioned in introducing the bill. His first emphasis was on signing an

agreement with Ottawa. I would like to discuss that point initially.

[Mr. Speaker in the chair.]

I think it's very obvious from federal and provincial government

statements over the last several years that undoubtedly inflation is

the No. 1 problem. I suppose it's almost got to the point now of just

sounding like speaking in favour of motherhood when one says, yes, we

must fight inflation. So when the minister introduces this bill and

give the No. 1 reason for the bill, and that we must pass it in order

to facilitate an agreement with Ottawa, I have to ask: what will be

accomplished by signing an agreement with Ottawa?

Secondly, even if we are to sign an agreement, in light of the

federal Minister of Finance's (Hon. Mr. Macdonald'

s) statement just the

other day that the federal budget on May 25 will bring about dramatic

changes in the federal anti-inflation programme, we at this point in

the provincial Legislature are debating a bill which has a great number

of ramifications, the exact nature of which we do not know. We've had

many statements from the provincial government and from the Premier

that this is a very temporary approach by the provincial government,

and with a maximum agreement with the federal government of one year.

Even now the federal Minister of Finance is stating that substantial

changes will be brought about as a result of his federal budget. So I

have to ask these two questions: what is to be gained by signing a

[ Page 1649 ]

federal agreement? Do we really know what we are signing?

The policy of introducing c ontrols is one which has a fascinating

history, inasmuch as a federal election was fought on that one

pre-eminent issue in 1974, and the government that was elected in

Canada was elected on a firm opposition to controls. Yet on being

elected, that party moved through 180 degrees in its position and

implemented controls. I'm not here to argue the morality or integrity

of that move, but I do think it shows that some programme of controls

to fight inflation has a large measure of support among the

politicians. And I understand that a recent public opinion poll showed

that as many as 72 per cent of Canadians believe some measure of

control is necessary to try and prevent the country from getting into

very serious economic difficulties, even worse than the ones we're in.

So it seems to be accepted that some form of control is necessary.

The second point is that economists, on the other hand, state that

artificial interferences with the natural economic forces in the

marketplace sometimes create as many problems as they solve. Above all,

any such intervention should be of a short-term nature, and I'm a

little surprised that the federal government considers three years to

be a short-term situation. At any rate, these are some of the areas

where there seems to be somewhat general agreement that controls are

necessary, despite the reservations that are held by economists about

their effectiveness.

I certainly would quote the former leader of the national

Progressive Conservative Party, who fought an election on the issue,

and admitted that a programme of inflation controls was a form of rough

justice. He was emphasizing the great difficulty in applying these

kinds of controls programmes equitably, both to the public sector and

to the private sector, and in seeing that it operated fairly, both in

relation to the wage-earner and to the person who was setting prices

for goods.

If I have to wonder why we should sign an agreement with the federal

government, Mr. Speaker, it would have to be based on the very

inconsistent performance of the federal Anti-Inflation Board in the

time that it's been in existence. There has been inconsistency in

application of the guidelines in the first place, and certain groups

have been awarded contracts where the percentage amount of the award

exceeds the guidelines, and other groups have been treated in a rather

more rigid and inflexible manner within the 8 to 12 per cent figure.

The inconsistency of the Anti-Inflation Board federally has also

extended to the rollbacks. This, in turn, has created a sense of

inequitable treatment, and the conclusion many groups have come to is

that there are certain rules for some people, but not the same rule for

others. So on the record, the performance of the federal Anti-Inflation

Board has not been encouraging.

It's very interesting, Mr. Speaker, to quote from the executive

director, Mr. Robert Johnson. He was interviewed in a very interesting

full-page review in the Financial Post . It appeared on May 8,

just a few days ago, and the critical question he was asked, right in

the beginning of the interview, was: "Will the controls programme

work?" The answer Mr. Johnson gave is exactly as follows: "If we

administer it fairly and firmly and explain what we're doing."

It would seem to me that with all the good will to try and make this

programme work, the record so far is not very encouraging. Yet here we

are, as a provincial legislature, seeking to sign an agreement with the

federal government, even although the evidence suggests that the

federal government on its own has not really been doing a very good job

in the fight against inflation. I hesitate to use the word "bogus,"

because I don't mean that the federal government itself is wilfully

trying to deceive the Canadian citizen, but Jean Chretien did announce

some weeks or months ago the percentage decrease in federal spending,

and yet as the weeks have gone by since that statement it is quite

clear that the degree of cutback in federal spending is going to be a

great deal less than the president of the Treasury Board announced at

that time.

While economists differ on the effectiveness of controls, there

seems to be more or less unanimous agreement on the importance of

cutting back on government spending at all levels. Again one would have

to say that any objective person looking at federal government spending

would not be encouraged by the evidence of their own example of cutting

back at the federal level.

This government, to give it credit, has continued a policy of

reducing the size of its own civil service, and in a much more

personally affected way it has reduced the salaries and expenses of

MLAs by 10 per cent. At least, that is some kind of example set by the

provincial government which I, for the life of me, can't see at the

federal level.

The more I look at the first principle involved in this bill which

the Minister of Finance outlined, that we need this bill in order to

provide the provincial framework to sign an agreement with the federal

government, I just cannot be convinced by the federal actions in the

past year or 18 months that I can have much confidence in the fact that

the federal government itself is either setting the example or

producing any kind of clear-cut results that would encourage us to sign

such an agreement for several of the reasons that I have mentioned.

The Premier stated quite recently and was quoted in the press as

emphasizing that the programme we would sign on behalf of British

Columbia.... I quote from the Vancouver Sun of April 10: "Bennett told

[ Page 1650 ]

a news conference, that the proposed agreement will likely end in

April, 1977." Mr. Speaker, we are already halfway through May, 1976. I

have tried to outline some of the reasonably objective evidence to

show that the federal efforts are not exactly an overwhelming success.

We still don't know when the agreement will be signed — presumably in

June.

Just as a simple observer of the scene, if nothing else, I have to

say to myself, are we going through all this exercise passing a bill —

I wish to comment later on in regard to the very extensive authority in

the bill — for some agreement of dubious value that will be in effect

for a matter of 9 or 10 months? It seems to me, Mr. Speaker, that the

government might well have entered into this course many months ago

with the best of intentions and with the conviction that a

federal-provincial agreement was desirable. But I have to ask whether

on May 12 we should be getting into the kind of agreement which has

been suggested for such a short period of time and with numerous

uncertainties, not the least of which is, as I said a moment ago, the

recent announcement by the federal Minister of Finance that there will

be very substantial changes in the anti-inflation regulations when he

introduces the budget to the federal House on May 25.

In fact, I could perhaps ask the minister a specific question at

this point which he could answer in his winding up of the debate, Mr.

Speaker: is it anticipated that the province of British Columbia will

sign the proposed agreement before the federal budget is introduced on

May 25? It would seem to me that since the federal minister has

signalled the fact that federal government policy and regulations on

the anti-inflation programme are to be substantially affected by the

budget, maybe this province should at least give itself the amount of

provincial flexibility not to sign any such agreement till we know all

the ramifications.

Mr. Speaker, regardless of whether we acknowledge the value of a

federal agreement or not, the executive director mentioned that unless

the wage and price controls are applied equitably and fairly and unless

an explanation is given to Canadians as to what is being done, it won't

work. I think one of the best studies that was done to point out some

of the inequities in the programme that have already evolved was quoted

in one of the newspapers in an

article by Neale Adams on May 5 where he

pointed out that wages in 1976, by and large, had held within the 12

per cent upper limit as suggested in the federal guidelines.

But then he pointed out that municipal governments, school boards,

provincial governments had really seriously damaged any credibility of

fair play to the consumer by greatly increasing taxes of various kinds.

Previous speakers have mentioned all the various government measures

that have increased the cost of living. The conclusion that was reached

in that

article on May 5 was that the average family had fallen behind

to the extent of $870 in terms of real purchasing power.

I think, Mr. Speaker, in debating this bill in as objective a way as

one can on something that so intimately affects each individual.... The

public are confused because of all the apparent contradictions that

have been demonstrated again by both federal and provincial

governments. Governments espouse a commitment to fight inflation. We

had the initial commitment from the Prime Minister to wrestle it to the

ground a year or two ago, and we've had numerous repetitions of that

kind of commitment, I guess, from all the provincial governments and

from municipal bodies and from school boards. Yet however sincere these

commitments might have been, all that the individual consumer in this

province knows is that every time he opens a newspaper or every time he

goes to pay a bill, any increased income he's derived in recent months

is much outweighed by the increased bills that he has to pay, whether

it be for Hydro or telephone or transportation or food, or just about

any other commodity that can be mentioned.

I think we should emphasize the confusion in the public mind as a

result of many of the contradictory actions of government. To put it

more bluntly, the government says one thing and does another. That

brings me back, Mr. Speaker, to this concept of signing an agreement

with the federal government. We've had a lot of statements by the

Premier that he is very much committed to the confederated system of

government, and national unity, and all the values which that system of

government provides for Canadians. We've had the statement, and now the

bill before us, that to prove that commitment to the federal system the

government will sign this agreement.

Yet, Mr. Speaker, I find myself completely confused by the statement

that was made in the House on April 9. It's so contradictory and

confusing, I wonder if it would be worth just reading it into the

record. The Attorney-General (Hon. Mr. Gardom), on April 9, said as

follows:

We consider that the distribution of powers between the provinces

and the federal government as set out in sections 91 and 92 of the BNA

Act must be preserved in order not to curtail the constitutional

autonomy of the provinces.

It is therefore British Columbia's submission that exceptions to

this general rule of provincial autonomy whereby the Parliament of

Canada can intrude into the provincial domain are limited to where

national emergency conditions exist, for under such circumstances,

according to the provisions of the BNA Act, the federal parliament can

enact legislation affecting what are normally provincial powers on the

[ Page 1651 ]

contained in that statute.

I'm still quoting the Attorney-General.

In our view, Mr. Speaker, it is obvious that the federal

anti-inflation Act in ordinary circumstances would amount to a

considerable intrusion into established areas of provincial

jurisdiction, most notably that of property and civil rights — for

example, powers to regulate increases in wages and prices. Hence,

British Columbia will advance arguments to the supreme court that such

intrusion is proper only if the court concludes that there is a

situation of emergency, in degree and reality sufficient to properly

commit Parliament to exercise the powers in question.

In

summary, Mr. Speaker,

and I'm still quoting the Attorney-General,

we are entering the case on the basis of the support of the federal

position, but on the clear understanding that evidence must be led as

to the exceptional conditions that prevail and that without such proof

historically a provincial constitutional jurisdiction.

Now for the life of me, I can't imagine how absolutely incredibly

the provincial government seems to be trying to run in opposite

directions at the same time. They want to sign an agreement with Ottawa

expressing their concern about inflation and that it is of a national

emergency nature. They've made a commitment to sign the federal

agreement based on the perception in this province that we do, indeed,

have a national emergency related to our economic circumstances if

inflation is not controlled. That, to me, is perfectly understandable.

But the next thing we get is this statement from the

Attorney-General that the Government of British Columbia will be an

intervenor before the Supreme Court of Canada to ask the federal

government to prove that there is a national emergency.

Now, Mr. Speaker, no wonder the people of the province and Canada

are confused. The provincial government is saying: "Yes, we should sign

an agreement; yes, we need authority such as we have in this bill to

deal with what is a national emergency." Then, on the other hand, they

turn around and contest the federal government's position before the

Supreme Court of Canada, asking them to prove that an emergency does

exist, and on that basis they can intrude into what, in ordinary

circumstances, are provincial powers.

These are not ordinary circumstances. This contradictory behaviour

of the government, to me and to many people who write letters to MLAs

and raise this issue.... I have to say that that is an issue I would

like the Finance Minister to explain when he winds up debate on second

reading.

One of the ministers opposite is shaking his head that my

interpretation of events is, perhaps, inaccurate. It may well be. But

Mr. Speaker, we don't sit here in this House and get into debates to be

academic among ourselves. We are trying to explain and justify policies

and positions to the taxpayers of British Columbia — the consumers, the

people who pay the bills. All they know is that on the one hand this

government has been talking for months about signing an agreement with

Ottawa because we've got a national emergency in the form of inflation,

and the next day they open the newspapers and discover that we're going

to the Supreme Court of Canada to challenge the federal government's

right to do that very thing. Now if that isn't confusing, and at least

apparently contradictory, I don't know what is.

To quote the other kinds of contradictions that are apparent, we

have the government's plea to the consumer to exercise restraint in

wage increases demanded to an upper limit of 12 per cent. Yet, again,

we have the government implementing tax increases of a dimension much,

much greater than the guidelines and ceilings that are imposed on wage

demands. It brings me back to the statement of Mr. Johnson, the

executive director who is trying to make the federal programme work:

unless it would appear that everybody is being subjected equitably to

the impact of controls, then all that is likely to happen, and indeed

may well happen, is that employees, through their unions, their

legitimate voice in bargaining for better wages, are simply going to

reach the conclusion that this is a one-sided con game. The government

appeals to our sense of patriotism, national unity and all these other

high-sounding goals, that you and I, in the case of MLAs, should take a

10 per cent cut or other people should, at least, have a wage increase

not more than 10 per cent. But, oh, when it comes to the government

itself, then actually there appear to be no guidelines at all and the

government can increase one specific tax by 40 per cent, which it did

in the case of the sales tax.

I don't want to get into that other parallel argument about whether

one balances a budget or doesn't balance a budget. I'm talking about

the basic credibility of this government or any government at any level

which espouses a certain principle that everybody should act equitably

towards the economy and be treated equitably by the economy. This

contradiction is very obvious, that while this government has supported

the principle of the federal guidelines, by its own actions it has

appeared to be unwilling to do by example what it is asking the

wage-earner and the consumer in British Columbia to accept.

Without getting into the argument of black ink or red ink, I

personally believe that this government would have a great deal greater

credibility if, at least in the short run, the measures it had sought

to raise more revenue had been closer to this basic principle of 10 or

12 per cent increase in such matters as hydro

[ Page 1652 ]

rates, sales tax, ferry rates and so on.

The consequence might still have been a budget deficit, but the

point I am trying to make is that at least in the government's attempt

to fight inflation and treat all citizens equitably, the government

would have demonstrated that it, itself, is practising what it

preaches. In a time where leadership and progress by example is,

indeed, a very fundamental key to the success of these programmes, I

have to conclude that neither the federal government nor this

provincial government have been very successful in setting such an

example. I again acknowledge that this government