1995 Legislative Session: 4th Session, 35th Parliament

HANSARD

The following electronic version is for informational purposes only.

The printed version remains the official version.

Official Report of

DEBATES OF THE LEGISLATIVE ASSEMBLY

(Hansard)

TUESDAY, MAY 23, 1995

Afternoon Sitting

Volume 20, Number 6

[ Page 14423 ]

The House met at 2:06 p.m.

Prayers.

Hon. U. Dosanjh: Present in the gallery today are my sister and her husband, and a member of their extended family from India, Gurpartap Singh Sahi. He happens to be the Deputy Minister of Finance -- known as financial commissioner -- in the state of Punjab. Present with them are many members of the extended family, both young and not so young. I ask the members to welcome them.

Hon. M. Harcourt: Hon. Speaker, as one of our sports greats, I'm sure you will appreciate the tremendous accomplishment of the Kamloops Blazers on Sunday night when, for the third time in four years, they won the Memorial Cup. I may say that it's a pleasure to watch the quality of the hockey. I was there last week, and even though I had to....

An Hon. Member: Did you get booed?

Hon. M. Harcourt: The boo was just a traditional welcoming boo that any politician could expect. As I said to some of the people with me, the Inuit have a hundred different words for snow; politicians have a hundred different boos that we recognize. That was a usual polite boo, just to remind you that you're a temporary employee. Everybody was in a great mood. I even had to move about four inches as a puck whizzed by my head; the owner of the Kamloops Blazers said: "Well, that was either a Liberal or a Reform player from Brandon."

It was a wonderful game, the quality of play was first-rate, and I wish the people of Kamloops who own that hockey franchise, which is so successful -- the owner, the coach, the players and the people of Kamloops -- a great round of applause for a job well done.

Hon. A. Petter: I am pleased to inform the House that in the gallery today is a Swedish parliamentary forestry delegation. Included in that delegation are Mr. Peter Nygards, Deputy Minister for Industry and Commerce; Mr. Anders Holmgren, Assistant Deputy Minister of Industry and Commerce; Dr. Jan Remrod, CEO and director general of the Swedish Forest Industries Association; Mr. Ulf Osterblom, managing director of the Federation of Forest Owners; Mr. Lars-Erik Eld, managing director of the Swedish Sawmill Federation; and Mr. Magnus Ericson, consul general with the Swedish embassy in Vancouver. I would ask the House to join me in making them very welcome.

F. Jackson: I would like to add to what the Premier said. For the last year, my wife and I have been entertained in Kamloops regularly at every home game by a group of young men who have shown courage and skill in playing the game that they love to play. Last week I watched them take on the best that Canada and the United States had to offer and come out on top.

I would like to read a few names into the record so we know exactly where they come from: Colin Day and the directors; Bob Brown, the general manager; Don Hay, the coaching staff and Spike; and Darcy Tucker and the players of the Kamloops Blazers, who for the last week set Kamloops afire. I would just like to again show our appreciation for a wonderful group of people.

R. Kasper: In the gallery we have Ms. Grace Bedek. Grace is the president of the United Manufactured Home Owners' Association in British Columbia. I understand they have a membership of some 6,000. Grace is also the association's appointee on the province's dispute resolution committee, which deals with manufactured home problems with park owners and home owners. Would the House please make her welcome.

J. Sawicki: I would like to ask the House to join me in welcoming here on the floor of the House our friend and colleague from the federal parliament, Svend Robinson, the MP for Burnaby-Kingsway. Svend and I share half a riding together and have done a lot of work on environmental and human rights issues. I'm sure all members of the House would like to join me in welcoming him here today.

Hon. B. Barlee: I think the Grand Forks Secondary School band is about to appear momentarily. Seeing that it's from my old hometown, I would hate to be left behind, so I would like all members of the House to give them a very warm welcome indeed.

J. Weisgerber: I'd like to introduce a constituent, Mr. Rick Berry. Rick is very deeply concerned with water levels on Williston Lake and the effect of that on his community of Mackenzie. Rick is a millworker there. He has lobbied all over British Columbia to try and get British Columbia to recognize the seriousness of that issue. I would like to introduce him now to members of the House, because he will probably be around to see you.

G. Campbell: I'd like to introduce to the House 60 students from Magee Secondary School who are here to watch democracy in action. I hope the House will make them welcome.

Hon. C. Gabelmann: I'd like to introduce two Vietnamese lawyers who are in Victoria for two weeks, working with the University of Victoria faculty of law and legislative counsel, preparing a legislative drafting manual for adoption by the law committee of the National Assembly of Vietnam and a model syllabus for a legislation course for use in Vietnamese law schools. Would members please welcome Nguyen Van Phuc, who is the vice-director of the law department of the National Assembly of Vietnam, and Nguyen Sy Dzung, who is the vice-director of the general affairs department, National Assembly of Vietnam. They are here with chief legislative counsel Brian Greer.

Introduction of Bills

PHARMACISTS, PHARMACY OPERATIONS AND DRUG SCHEDULING AMENDMENT ACT, 1995

Hon. P. Ramsey presented a message from His Honour the Lieutenant-Governor: a bill intituled Pharmacists, Pharmacy Operations and Drug Scheduling Amendment Act, 1995.

[ Page 14424 ]

[2:15]

Hon. P. Ramsey: I move the bill be introduced and read a first time now. This bill makes amendments to the Pharmacists, Pharmacy Operations and Drug Scheduling Act to create and administer a provincewide pharmacy information system. This will facilitate the professional practice of pharmacists, enabling them to better protect the health of British Columbians. It will enable faster responses to British Columbians' benefit claims from Pharmacare. It will provide a more cost-effective administration of the Pharmacare program. It will prevent prescription drug fraud.

It will enhance the ability of the College of Pharmacists of British Columbia to investigate and prevent cases of malpractice or breaches of professional bylaws. Finally, it will improve information-gathering for the purposes of epidemiological and other scientific research.

In order to ensure the proper use of information to be contained on the PharmaNet computer system, a PharmaNet committee is established to manage access to the database and ensure that individuals' personal information is protected. When brought into force, the provisions of this legislation related to PharmaNet will comply with the requirements of the Freedom of Information and Protection of Privacy Act.

Bill 27 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.

Oral Questions

APPOINTMENT OF CHRIS CHILTON

G. Campbell: The auditor general has said there was a deliberate effort to hide specific contracts through the Premier's Office staff's NOW Communications cover-ups. One contract was evidently to manage the closure of ten hospitals in B.C. Now the architect of those deceptions, Mr. Chris Chilton, has been parachuted from the Premier's Office into the Ministry of Health, at an estimated salary of over $120,000 a year. Can the Minister of Health tell us if he was involved in the decision to put Mr. Chilton in his ministry? If so, can he inform us of Mr. Chilton's background in health care and his specific qualifications to be paid $120,000 a year?

Hon. P. Ramsey: Mr. Chilton's background and his commitment to preserving medicare and fighting the cuts of the federal Liberal government will be welcomed. I must say that this person will serve us well as we look at resisting the clear abandonment of medicare by the federal Liberal government. That may not be an issue for the members of the opposition, but it's an issue for every British Columbian who is looking at the effect of those cuts on their health care. We need to resist that, and I think we need everybody's help in making that a reality for British Columbia.

G. Campbell: Let's be clear. The way to protect our health care system is not to simply parachute a bunch of NDP hacks into the Health ministry. Put this in context. The Deputy Minister of Health is paid $98,000 a year. The NDP's master of deception, Mr. Chilton -- a man with no experience whatsoever in health care -- is paid over $120,000 per year so he can deliver pre-election advice to a struggling government. Can the Premier tell us why the taxpayers should pay over $120,000 a year to yet another NDP hack to plan the NDP's election strategy on health care?

Hon. M. Harcourt: I find it very ironic that the Leader of the Opposition, who gave $2.4 million of city contracts to one of his own political hacks and who was voting on a monopoly travel contract to one of his big campaign backers, should be talking like this in this Legislature. The prince of smear, who cannot take....

Interjections.

The Speaker: Order, please. Would the hon. Premier please take his seat.

Interjections.

The Speaker: Before recognizing the hon. Opposition House Leader, hon. members, I have to say that the trend toward total disorder in question period has been rapidly increasing, as members well know. The purpose of question period, in case you have forgotten, is to ask questions and to wait for a response. It is really not the time to be bringing information but to be receiving information, but a certain amount of latitude has been allowed in order for members to make their point. I would ask the members to please keep that in mind.

The hon. Opposition House Leader on a point of order. I should say that the point of order is unfortunate. However, hon. member, inasmuch as the Speaker has had to remind members of the purpose of question period, I will entertain your point of order. Please proceed.

G. Farrell-Collins: I would merely ask the Premier to withdraw his "smear" comment.

The Speaker: The Premier is being asked.... I will ask the Premier: has the Premier in any way intended to impugn the honour of any member of the House?

Hon. M. Harcourt: I will withdraw that remark.

I withdraw that remark, but I will say that when the Leader of the Opposition charges that there has been a misleading of the Supreme Court by the Attorney General, and that is cleared by the special prosecutor; when he charges that the Minister of Agriculture has been involved in a conflict, and the conflicts commissioner clears that; when the auditor general and the conflicts commissioner clear me of any wrongdoing whatsoever concerning NOW Communications and say there was no pattern of favouritism in the awarding of government communications work, and that in its relationships with government, NOW Communications was treated similarly to other companies that supplied similar services, he should have the good grace to go by the truth.

G. Farrell-Collins: I would ask the Premier to read those two reports. They hardly cleared him or his government from any wrongdoing.

Mr. Chilton was the chief architect of the deception surrounding the NOW Communications cover-up, as quoted by the auditor general. Under his stewardship in the Premier's Office, a wide-ranging pattern of deception emerged across

[ Page 14425 ]

government in finance, forestry and education, to name a few. Can the Premier tell us why he's so eager to pass on advice from the NDP spin doctor responsible for this web of deception, and why, with a staff of thousands, the Minister of Health can't get advice a little more cheaply?

Hon. M. Harcourt: The auditor general found that NOW Communications was treated no differently than any other company that was bidding. He found that the contracts were basically administered appropriately. He found that there were a small number of contracts that were not administered appropriately, which he expressed some concerns about. I have accepted those concerns of the auditor general and the conflicts commissioner and have made changes.

The Speaker: Supplemental, hon. member.

G. Farrell-Collins: What the auditor general said was that 23 percent of contracts went to NOW -- not 5 percent, as the Premier said. He also stated that there was a clear cover-up to mislead the public on where those contracts were going. Chris Chilton is the guy who organized the clown hall meeting; he's the guy who cemented the Premier's feet at a level of popularity lower than Bill Vander Zalm's; and he's the guy who oversaw the construction of a web of deception in this government. Why does the Premier think this qualifies Mr. Chilton to oversee the development of the NDP's pre-election campaign in the Health ministry?

Hon. M. Harcourt: When you have a federal Liberal government that is cutting $750 million out of the budget for health and post-secondary education, when you have the Liberal opposition standing up and saying that they didn't cut enough.... These people are trying to put across that they're the defenders of medicare, when they want to dismantle medicare and bring in a two-tier health care system. This side of the House -- the New Democrat government, which was the pioneer of medicare -- is going to protect medicare from the two-tier Liberals.

STAFF CHANGES IN PREMIER'S OFFICE

J. Weisgerber: A question to the Premier, who, after three and a half years in office, can now recognize a hundred variations of the boo, Mr. Speaker.... Only someone who has been booed as often as this Premier has could recognize that variation.

My question to the Premier is: the auditor general has found his government guilty of a money-laundering scheme that saw NOW Communications used to funnel money to Karl Struble and his friends in Washington, D.C. Instead of being punished and reprimanded, those people have been rewarded with soft new positions elsewhere in the government. Why in the world has the government decided to reward those people guilty of fraud and deceit within his own office?

Interjections.

Hon. M. Harcourt: The Leader of the Third Party is probably very sensitive to boos. He should be after being part of one of the worst governments this province has ever seen -- the previous Vander Zalm government.

Interjections.

Hon. M. Harcourt: And that wasn't a raspberry he was receiving in those days. Hon. Speaker, I can tell the different kinds of boos. I've been elected for 23 years, and through nine elections. I accept that our citizens are going to express themselves about politicians in that friendly way when I go to sporting events. But I can tell you, hon. Speaker, that the words the member has used are offensive. Their attack on people's integrity -- whether it be the Liberal opposition or the Reform opposition -- and their ability to continually attack people's integrity and to continue to talk about scandals when people have been cleared are going to be remembered by the voters in the next election.

I have accepted the recommendations of the auditor general, the conflict-of-interest commissioner and have made the appropriate changes.

The Speaker: Supplemental, hon. member.

J. Weisgerber: The auditor general found concern with the way 16 contracts were administered and handled by and through NOW Communications. Indeed, the Premier has done absolutely nothing to reprimand the people responsible. The Premier says that it's not a question of who's at fault; it's a question that it won't be done again. Mr. Premier, taxpayers are angry, and they're disgusted with the way your government has handled this issue. My question is: does your special no-fault insurance plan for political hacks apply only to those in your office, or does it apply across government? Where does your no-fault insurance plan end for political hacks in this government?

Hon. M. Harcourt: When he was in government the Leader of the Third Party didn't bring in conflict laws, didn't bring in freedom-of-information laws, didn't bring in fair bidding on advertising contracts; it was this government that brought in all three. The advertising industry itself has made it very clear that this is the fairest government they have seen in recent history in awarding these contracts, and that the contracts were awarded on merit. The industry said that, the auditor general said that, and the conflicts commissioner said that.

The only people who don't want to hear the truth are the opposition, who want to keep practising the politics of smear and fear in British Columbia, and they will be found out at the next election.

COST OF LEGAL ADVICE ON COLUMBIA RIVER NEGOTIATIONS

W. Hurd: My question is for the Premier. The opposition has received documents which set out the legal costs incurred by B.C. Hydro in negotiating the return of downstream benefits from Bonneville Power. It appears in these documents that Hydro has paid Lawson Lundell more than $1 million in legal fees to obtain what we now know is a non-binding memorandum of agreement. Now that the deal appears to have collapsed, will the Premier confirm whether he is using the same law firm to provide legal advice, which is the same one that gave us the advice on this interim agreement?

[2:30]

[ Page 14426 ]

Hon. M. Harcourt: Again, we want to know whether the opposition are unanimous in making sure that British Columbians get treated fairly by a major American corporation. If they want us to have the best legal advice that we could have over the last three years, to provide us that legal advice.... And I would hope that they would want us to have the best legal advice we can when we put an agreement together with Bonneville, which we are debating right now in this Legislature. If the member would like to know the details of that particular contract and advice, he has full access to the law that this government introduced under freedom of information.

The Speaker: Supplemental, hon. member.

W. Hurd: It seems that the same document shows that B.C. Hydro paid $300,000 to American law firms to help draft this memorandum of agreement. Given that Hydro's high-priced American help produced an agreement which BPA has now walked away from, will the Premier explain how his government could spend $300,000 on U.S. legal advice and still come up empty-handed?

Hon. M. Harcourt: I'm sure the hon. member, as the Forests critic, would object to the funding that we put into fighting the countervail, using some of the best legal advice that we could -- and we successfully fought that. I'm never going to turn away from the best advice that we can find -- whether it's here in British Columbia, in Canada or in the United States -- to help the people of British Columbia.

EMERGENCY PREPAREDNESS AND CANADIAN FORCES MOVE OUT OF B.C.

R. Chisholm: My question is to the Premier. I'm tabling in the Legislature today a

summary of responses that I have received from local councils and regional districts to my March 20 letter regarding emergency preparedness and the withdrawal of the Canadian army from British Columbia.

Does the Premier not think it's time to tell Ottawa they have obligations here, and that they're not going to be allowed to leave the third-largest and fastest-growing province in the country without adequate support?

Hon. M. Harcourt: I'm pleased to receive, finally, a question that really does relate to the legitimate needs of the people of British Columbia. The hon. member is aware that yes, I agree with the opinion that he's just expressed. Yes, we should have that emergency prep here in British Columbia, not in Calgary.

I have written to the Prime Minister about that. I have expressed that opinion to the member, and I'm quite prepared to work with him, local councils and mayors to make sure that we do have that resource here in case of an emergency in British Columbia.

The Speaker: The bell terminates question period.

The member for Chilliwack rises on a matter.

R. Chisholm: I ask leave to table a document.

Leave granted.

R. Chisholm: I table a document containing letters from municipalities and regional districts in reference to my letter of March 20.

Orders of the Day

Hon. J. MacPhail: I call Committee of Supply in

Section A to debate the estimates of the Ministry of Health. In

Section B, this House, I call Motion 87.

The Speaker: The member for Richmond-Steveston rises on a point of order.

A. Warnke: I'm rising on a point of order under standing order 55. Since we are dealing with a substantive motion that requires the attendance of the House to hear the debate and reach a distinct decision, any alteration by adding another order is to alter the form of debate, in my opinion, of the motion that's under consideration.

This may be done, but what is required is a motion under standing order 55(d), which is permissible to allow Health estimates in Committee A to proceed. And since it was not done, as just announced by the Government House Leader, under standing order 55(d), therefore I do not see how these estimates can proceed. The only order that is before the House right now is the motion that is being debated. As well, for support on this, Erskine May has made it very clear in

chapter 17 of Parliamentary Practice, twenty-first edition: "When the question has been proposed by the Speaker, and read to the House, the House is in possession of the question, debate begins and the House must dispose of the question in one way or another before it can proceed with any other business." Standing order 52, just to be fair, in the British House of Commons, does provide for the questions on estimates proposed for debate on an estimates day to be deferred -- to be deferred, I emphasize -- at the conclusion of the debate until later on the same day.

The Speaker: The hon. Government House Leader on the point of order.

Hon. J. MacPhail: It's an interesting point. However, it's not as if what we're doing here is something that has not been done in this House before. Debates around important matters have taken place in this chamber while equally important debates around the estimates take place in the small committee. The fact of the matter is that a massive amount of important business faces us in this chamber, and we are ready, willing and able to engage on both fronts to debate the important matters.

I think that in the past, the members of this House have shown very well that they can divide their time appropriately between the two Houses and engage in a full range of debate. It's important that we proceed in a timely manner around Motion 87, and I would expect that the members opposite would want to engage in that discussion. At the same time, there are equally important matters facing us concerning the estimates of the Ministry of Health.

G. Farrell-Collins: Despite the comments from the Government House Leader, expediency is not a reason to break the rules of the House without unanimous consent. I believe that the Speaker will find, on review, that indeed in all instances over the last three sessions when this House has

[ Page 14427 ]

debated substantive motions, at no time was Committee A sitting, which would allow all members to participate in that debate and vote.

Interjections.

The Speaker: Order, order, hon. members. All hon. members know full well that speaking from their chairs when they haven't been recognized by the Chairman is out of order, and I would ask members to please bear that in mind.

Hon. J. MacPhail: Just a final point.

The Speaker: Is the member rising on the same matter or a different matter?

Hon. J. MacPhail: It is just to challenge an inaccuracy in the Opposition House Leader's statement, hon. Speaker.

Interjections.

The Speaker: Order, hon. members.

The Chair has listened to the presentation by the member for Richmond-Steveston and while the matter is well taken, the Chair is not prepared to make a ruling at this point. I'm of the opinion, however, that this is not setting a precedent. It may indeed be a matter to be reviewed, and I shall do that at the earliest opportunity with the Clerks.

We are now proceeding on the motion before us, which is an amendment.

Motions on Notice

COLUMBIA RIVER TREATY NEGOTIATIONS

(continued)

On the amendment (continued).

J. Doyle: I'm pleased to speak today on behalf of the residents of Columbia River-Revelstoke on this very important matter to all of us in British Columbia. Thirty years ago the lifeblood was sucked out of the Columbia River. Golden and Revelstoke in my riding in particular paid a great price. We gave our best forest-growing valleys.... The Mica Dam, that being the Kinbasket dam...was not even logged before it was flooded. Some of our best trees are under up to 300 feet of water. Some of the members over there in the official opposition.... I think the only trees they've ever really seen are the ones standing in Stanley Park.

What did we give our valleys for? Cheap power to the United States and Bonneville Power. The rest of the province got cheap power too. Thirty years ago we were sold out with the strokes of gold-plated pens. Were the residents of the Columbia Basin asked how they felt? No, all we got was the shaft.

But we in the Columbia Basin have lived up to that terrible agreement for the last 30 years; most, if not all, of the time, we had the short end of the stick. The Columbia Basin residents say: enough years of giving the cream away. The biggest resource we have in the Columbia River Basin is our youth, and because of the devastation of that sellout 30 years ago, that has also been one of our biggest exports, along with our water.

We're fed up with getting only the skim milk back from this terrible deal of the last 30 years. What happened 30 years ago, and what happened last week when Bonneville Power tried to walk away from this agreement? I say it affects all of us in this House, all of us British Columbians. Finally we have a Premier and a government making a good deal for British Columbia, and included this time, for a change, are the residents of the Columbia Basin.

The Speaker: The hon. member for Okanagan West rises on a point of order.

C. Serwa: The point of order is that we're addressing the amendment to the resolution, and the member, who I've listened to closely for five minutes, has not addressed the amendment at all. He should therefore lose his place in debate because he failed to address the amendment. He is speaking to the main motion.

The Speaker: The point of order has merit in that the member should stick as closely as possible to the principle of the amendment. However, to lose his place in order would be irregular, in that I'm sure all members know that latitude is normally provided on matters of principle in debate. Please proceed, hon. member.

J. Doyle: I'm pleased to continue speaking on Motion 87, on the amendment that was put forth last Thursday.

How many positions do the Liberals have on this agreement that we finally have in place for the people of the Columbia Basin? At least three. One is that 100 percent of the money would go for debt reduction, and then they would somehow give another 100 percent away to the Kootenays, and maybe they'll also give a portion of the money to the Kootenays. That's according to where the Leader of the Opposition is standing that day, as to what he says about this good agreement -- finally -- for the people in the Columbia Basin.

A couple of days before the Premier was up in Castlegar in March, signing this memorandum of understanding, the Leader of the Opposition was up there trying to tell the people in the Columbia Basin that the government hadn't listened to the people. It was referred to in the local newspaper in Castlegar as the Leader of the Opposition firing his SCUD missiles, and we know how successful SCUD missiles were.

[ Page 14428 ]

[2:45]

What does the Liberal opposition now want? They want an all-party committee established. I say that we have listened to and talked with the people in the Columbia Basin for the last three years, and the people are happy with the agreement we have in place. What about those five Socreds over there? They owe this House an apology for what they did to this province and to the people in the Columbia Basin thirty years ago. If the Socreds had formed the last government, we wouldn't be standing here today talking about the people in the Columbia Basin getting any moneys back after the 30 years of getting shafted.

It is only in the last couple of months, when the leader of the now Reform Party was running for the leadership of that party and had seen as he travelled throughout the Columbia Basin what a good deal this government had put together, that he came onside. I would like to remind the House again that if they had formed the government last time, we would not have had this agreement in place to bring something back home, finally, for the people in the Columbia Basin. They would have continued to forget and neglect the people there.

Their stand is -- and I have no doubt the stand of the member for Okanagan West still is -- that any moneys that come back should be spread right across the province, and the people who paid the greatest price should continue to get nothing back.

Our government says the people in the Columbia Basin have been dammed long enough. Our government has worked with the residents of the Columbia Basin. I would like to quote from the Cranbrook Daily Townsman of last week. Josh Smienk, who's the chairman of the Columbia River downstream benefits committee, is quoted in the Townsman: "The Bonneville power authority is notorious for being a pain in the ass! They have taken advantage of B.C. in the past. I personally think this is another example of that." There's other, similar wording in that item in the newspaper. Yet some people here think it is still okay for the people in the Columbia Basin to live with what happened 30 years ago.

I say no more bad deals. We in British Columbia and Canada are not a banana republic of that country down south of us; we are proud, independent British Columbians and Canadians. Let us stand up for this agreement. We in the Kootenays and the Columbia Basin have had enough. Thank you, hon. Speaker, for your time.

The Speaker: Is the hon. member for Rossland-Trail rising on the debate?

E. Conroy: Yes, hon. Speaker, I am. I wasn't quite prepared, as the other people in our speaking order were to go before me; nonetheless I'm prepared to move forward. I'd like to thank the members for the opportunity to stand here and speak to Motion 87 to do with the Columbia River situation as it has unfolded in the last couple of weeks.

The point I'm trying to make is that we've heard a lot of folderol from the opposition about the nature of the agreement and how we sure didn't do our legal homework. This is just ludicrous. These kinds of agreements are based on faith and good trust, and when we sign memorandums of agreement at the level of the Columbia River Treaty.... These agreements are there, and they're there to go through to fruition. This is how the business of dealing with these types of negotiations is done.

Opposition parties care nothing for the future of British Columbia. It seems to me, in dealing with this issue, that the main thing that seems to be in the forefront is what's in the best interests of them. We all saw the opposition vote in favour of the Columbia Basin accord. If the downstream benefit deal was so flawed, so imperfect, then I would suggest that the opposition parties were duty-bound to vote against the Columbia Basin accord.

If they had this foresight and all this wisdom about this horrible deal that we signed with the Americans, this negligent position that we took, why did they then vote for the Columbia Basin accord? How could they vote for it? The Columbia Basin accord is an integral part of the negotiated deal between the province of British Columbia and Bonneville Power.

Here we have an opposition that's second-guessing and playing politics, again, with the lives and livelihoods of British Columbians, and that never imagined in their wildest dreams.... They had to come onside over the whole Columbia Basin accord and the downstream benefits because they know full well that the government of British Columbia negotiated a good deal for British Columbians on this.

They know full well that the people of the Kootenays were getting their just rewards -- rewards may not be the right word here, but their just benefits -- as a result of the sacrifices they made over the years for the rest of the province. They voted in favour of the Columbia Basin Trust, and I congratulate them for that. But again I ask: how could they vote in favour of the Columbia Basin Trust, if this brain trust over here knew that this deal

[ Page 14429 ]

was not going to follow through to fruition? I'll tell you: the brain trust didn't know. Again, they played politics with the lives of British Columbians.

The opposition has flip-flopped around this issue ever since it has come.... As a matter of fact, it's so hard to nail them down in dealing with situations that have anything whatsoever to do with our natural resources. When I was preparing to talk on this issue, the thought occurred to me: have they come up with a position on Clayoquot yet? Are they in favour of it, or are they opposed to it? I don't know if they ever really decided on that one yet; here they are deciding, based on the political whims as the tides ebb and flow, where their political position will inevitably be.

What does this mean now to the people of British Columbia? It means, first of all, that we have a customer that has gone. The second thing it means is that we still have a resource that's worth billions of dollars to the people of British Columbia, and that the province, in negotiating a deal -- the first deal -- that was an excellent deal for British Columbians, will now move forward and do precisely that with the power we have to sell to the Americans or to whoever the case the may be. There is interest in this power from not just across the line but also throughout Canada.

I'd like to go one step further in suggesting that maybe this is not just all about the downstream benefits and the Columbia Basin accord. What it's really about is water. It's about water for irrigation: 1.5 million acres are irrigated in Washington State alone out of the reservoir behind the Grand Coulee Dam. It's about flow for recreation: there was $350 million worth of tourist business on the Roosevelt Lake reservoir alone last year in Washington State. It's about a residential fishery in the United States; it's about a salmon fishery in the United States.

It's about enhanced water quality in the Portland corridor. It's about navigation of the Columbia River in Washington State and Oregon, and it's also about power and flood control.

Americans know the value of the product we're providing. The value is just so immense as to be almost mind-boggling, I would suggest. In short, our assets are worth literally billions and billions of dollars. I would almost suggest that.... We have a situation now where we have a water bill on the floor of this Legislature that says that the only way water is going to go out of British Columbia, for all intents and purposes, is in the form of bottles. We knew during the free trade agreement that water wouldn't be on the table; the Americans insisted it not be on the table.

The simple reason is that the Americans view British Columbia water and Canadian water as a continental resource. It occurred to me, as I sat and read a National Geographic Magazine some time ago about the situation in the Middle East, that in looking at all the conflict that has occurred over there, many of us who sit and watch the news tend to think that it's over religion, or it's a turf war and stuff. Well, it's not; it's over water.

Water is probably going to be the most valuable commodity in the world in the next number of years, and the Americans know that. They've known the value of the Columbia River Basin for the last 70 years. If anybody in British Columbia wants to know anything at all about the Columbia River Basin, the place to go is Washington State, because they've got all the answers. They've studied it intensively for decades.

We have this water bill on the floor of the House that says that we in British Columbia believe that our water is here to benefit the people of British Columbia. If the Americans want it, they can have it in bottles. It's a Canadian resource, it's a British Columbia resource, and it's here to benefit the people of British Columbia. We're dealing with a federal government in the United States that views it as a continental resource. We're dealing with a situation right now where this government is saying that it's not a continental resource; it's a provincial resource.

[D. Lovick in the chair.]

I would suggest that maybe the Bonneville Power situation and the downstream benefits situation is a drop in the proverbial bucket with regard to the wealth that we're talking about. The Americans may very well have decided to draw a line in the sand here and say: "Enough is enough. We view water as a continental resource. We do not like British Columbia saying that it's a British Columbia resource, and we're not going to put up with it anymore."

Think about it from an American point of view. If I were the Secretary of the Interior in the United States, for example, I'd know full well that the economic prognosticators are saying that those that hold the world's agricultural cards within the next ten years are going to be the economic giants. The Americans have the potential to hold those economic cards if they have the water to make those cards grow. Unfortunately for them, they don't and we do. They want their hands on the water.

They do not want a government in British Columbia that is going to say: "No, it is not a continental resource; it's a provincial resource." That's exactly the last thing that they want to hear. They want to stop this movement, and they want to stop this movement right now. It means cancelling the downstream benefits package and putting us on notice.

[3:00]

If a member of our government were to go to Washington, D.C., and say to whoever, "We'll take our water bill off the table if you reinstate the Columbia River downstream benefits treaty to the way it was last week," I'd hazard a guess and say that that person would come back with that treaty in their pocket so fast it would make your head spin. It's not about that treaty; it's about control of water in the future.

We here in this region are sitting on the next pool of oil. We sold it out once -- we sold it out 30 years ago -- and we're not about to sell it out again. But I'm here to tell you that the people on the other side of the floor are about to sell it out again. The American government knows full well that those people will sell it out, because they're the same kind of people; they believe in the same kinds of things. They want to negotiate with our water. This government is saying that our water is not for sale; it's our resource.

It's up to the people of this province to decide what they want to do. They can go along with this whole plan as it has been formulated. It has been formulated in an attempt -- which I suggest has gone sorrowfully wrong -- to make us look bad, to give the opposition ammunition to attack this government, which they can't do. It's an attempt to have the government of this province change in order to facilitate the demands of the Americans. I would hazard a guess that without a doubt, if and when this government ever changes

[ Page 14430 ]

and the American demands for water come down, you'll see that the opposition parties will cave in to them so fast it will make your head spin.

This is about the downstream benefits. It's about honour; it's about returning an asset to the Kootenays that has been long overdue and that they deserve. It's about all of that stuff, but it's also about a bigger agenda than that. It's about who is going to stand up for British Columbians and Canadians, and who is going to say no, and who is going to say: "We're not going to sell the farm again.

If you want our resource, the answer is no, that is not on the table." It's going to take fortitude, and this government -- on this side of the House and on that side of the House -- is the only government in British Columbia in the foreseeable future, or maybe forever, that is going to have the fortitude to do that. The same government that had the fortitude to do what it did to preserve the forest industry in this province is now saying no to the Americans for British Columbia water. It's our resource; we're not selling it out again -- not a repeat of 30 years ago.

D. Mitchell: I'd like to enter into this debate on the special resolution moved by the hon. Premier last week. Now that we've had the advantage of a long weekend for some reflection, I wonder whether we can actually have some dispassionate debate -- getting away from the moment of excitement last week. I had a chance to review the debate that took place on the Premier's motion. Clearly there was a lot of rhetoric, a lot of excitement and perhaps even some passion; there appeared to have been some good debate.

We need to strip away the rhetoric and take a look at what has actually happened: what the action of Bonneville Power Administration really was and what its consequences are for British Columbia. I appreciate the comments made by the previous two members this afternoon as we revive the debate on the amendment. Both of those members have constituencies they seek to represent in this assembly which are directly affected because they are in the Columbia-Kootenay basin.

They are in the area directly impacted by the Columbia River Treaty, by the return of the downstream benefits and by the actions of the government in establishing the Columbia Basin Trust, which will certainly impact on both of their ridings. So there is a direct interest on the part of both of those members, and I appreciate their comments and the contribution they have made to the debate, given the fact that they seek to represent their constituents in this House.

There is a larger issue as well, and I seek to enter the debate as a member who represents a constituency not directly impacted. But, like every one of the 75 members of this House, I and my constituents have a direct stake in this matter, because those downstream benefits are a provincial asset. They are owned by each and every British Columbian. They aren't owned by one region. They are a provincial asset, not owned by one Crown corporation or one region of the province. All of us, as members of this assembly, should have an opinion and should seek the views of our constituents on this matter, because it is an important matter.

Important, yes. But is it an emergency? Should we be in a panic? No, hon. Speaker. That is why I think it is important that we have had the luxury of a little bit of time to pass over this long weekend to take a look at this matter freshly, to take a look at this matter in a way that perhaps got away in the excitement and heat of the moment. When I take a look at the actions of this House last week and reflect back on those, I wonder why it was ever proposed in the first place that we should seek an emergency debate, as was moved by the government.

Thank goodness for the member for Okanagan West who was in the House to deny leave to allow an emergency debate on this matter. That emergency debate would have sought no remedy nor achieved no solution to the problem. It would have seen rhetoric and posturing by political parties in this assembly but would not have provided any meaningful solution.

Thank goodness the member for Okanagan West was here as a watchdog for this parliament to ensure that we weren't going to abuse a political situation -- perhaps a manufactured situation -- where the government and perhaps the official opposition party might have sought to trade blows in the House without any meaningful solution, without any remedies that we can talk about in a more dispassionate way with the passage of a little bit of time.

Those downstream benefits are owned by each and every one of us as British Columbians. They are an asset of the province and in one way, shape or form they will return to the province over the last half of the Columbia River Treaty -- over the last 30 years. Those are benefits that cannot be denied by any American government, by the Bonneville Power Administration or by any conspiracy that some seek to find out there in the world. Those are assets of the province; they will come to us. We are simply debating the way, the method and the technique by which they will be returned to British Columbia.

We're debating an amendment to a motion, and I just want to read it into the record, because I think it's important to put this in context. The motion itself, which was moved by the hon. Premier, says: "Be it resolved that this House condemn the American Bonneville Power Administration for breaking a solemn commitment on the delivery and disposition of the Canadian entitlement under the Columbia River Treaty." That was the motion initially moved by the hon. Premier.

It's harsh language for a government to be introducing. It's talking about condemning an American power monopoly -- harsh language that might be well deserved -- and talking about a solemn commitment. One wonders whether or not a business transaction with a memorandum of understanding can be described as a solemn commitment. It reminds me of the rather overly colourful language used by a former Canadian Prime Minister by the name of Brian Mulroney. I think he used to refer to most things as solemn commitments or sacred trusts. The hon.

Premier says "a solemn commitment," but one wonders whether a business transaction should be referred to as such and whether there's any business experience on that side of the House that really cares to understand what a memorandum of understanding actually is. Nevertheless, that's the motion that the Premier put before the House after the emergency debate he sought was denied -- properly denied, I believe.

When that motion was being debated, the Liberal opposition moved an amendment which is what we're debating right now. I think that amendment should be read into the record today. It says that the Premier's motion should be modified by adding:

"And furthermore, given Bonneville's decision to withdraw from negotiations may seriously impact all British Columbians and most particularly those residents of the Kootenays, therefore be it further resolved this House do establish a special all-party task force, including independent members, whose mandate will be to investigate and develop a strategy that will ensure that British Columbians receive maximum benefit from the Columbia Treaty legacy."

[ Page 14431 ]

That's the amendment we're debating, and I wonder about the amendment as I look at it now. If this kind of amendment had been moved perhaps two and a half or three years ago, or if this kind of proposition had been put forward around the time that I as one member of this House was arguing for an all-party committee on Crown corporations -- which would have been dealing with Hydro -- we could have probably achieved some of the same ends of this amendment.

The amendment says that Bonneville's decision to withdraw from negotiations may seriously impact all British Columbians. I wonder about the veracity of that statement. Will Bonneville's decision seriously impact all British Columbians? I argue not, because those downstream benefits -- regardless of what the Bonneville Power Administration says, regardless of what any Yankee says -- are an asset owned by all British Columbians. So I don't think their decision really does seriously impact on all British Columbians.

The remedy proposed by the Liberal opposition is that a special all-party task force, including independent members, be established. As one independent member of this House I look at that with some interest. There was no consultation beforehand with this independent member, or with other independent members who were once members of the Liberal caucus. That kind of consultation hasn't take place, although I understand that one independent member was consulted and that's the Social Credit member for Okanagan West.

I congratulate the Liberal opposition for finally reaching out to the independents -- at least to one independent, which is a good move. If they really want to play a leadership role on the opposition side of this House, I urge them to reach out a little further even to some former Liberal colleagues who cannot stomach to serve in that caucus any longer, and actually engage in genuine consultation if they want to try to persuade independents to support this motion.

This motion suggests that the so-called crisis -- and I would argue that there is no crisis here whatsoever; it's a fabricated crisis -- can be dealt with by an all-party task force. An all-party task force might be a good idea when it comes to accountability of Crown corporations. Hon. Speaker, you and other members know I've argued for that for the life of this parliament, but we need to be tough in terms of dealing with the Bonneville Power Administration.

British Columbians need to be a lot tougher than we have been in dealing with the Americans in terms of what is going to take place for the second half of the famous Columbia River Treaty. There have been some mistakes, and if there has been any mistake that is serious, it is that we haven't been tough enough with the Americans. We haven't been tough enough as negotiators. We've been too easy in giving in to the traditional view of Canadians as hewers of wood and drawers of water, providing cheap resources for our American neighbours.

We have a tremendous negotiating advantage. We have the resource wealth that our American neighbours, and indeed the rest of the industrial world, are hungry for. The most valuable of all those resources is water; there's no doubt about that. The Columbia River Treaty gives us an extremely heavy negotiating hand. We don't have to panic about a decision by the Bonneville Power Administration made for short-term considerations, or perhaps to try to achieve a negotiating advantage with us on a short-term basis. BPA can decide what they want. We own those downstream benefits, and we can take them back. Perhaps right from the start we should have told them that we wanted to take them back.

I'm concerned when I take a look at the statement made by the hon. Premier as he started this debate, because he outlined for the first time what the instructions were to the negotiators. I can remember, during the last session of this House, when I asked the minister responsible for B.C. Hydro: "What were the instructions given to the negotiators for the Columbia River Treaty?" I asked him to be explicit about that; he wouldn't answer the question. His only response was that he had instructed, and the government had instructed, the negotiators to get the best deal possible for British Columbia. As is turns out, they were given more instructions than that.

The hon. Premier, in this House on May 18, when he launched this debate, said: "The mandate I gave to the negotiators was to seek alternate arrangements to returning the power at Oliver." Now, I'm going to end the quote there. I'm not going to read back the Premier's words at length, but they're there in Hansard for all to see. But the point the Premier made -- and this was a revelation, because it had never been told before -- was that the government didn't tell the negotiators who were representing British Columbia and the Canadian interests in these negotiations on the second half of the treaty....

The government did not instruct them to take a tough stand, to play hard, to play a tough game of poker and not to blink with the Americans, who we always believe have taken advantage of us in these kinds of international negotiations. No, the Premier said to tell the negotiators to seek alternate arrangements to what was already prescribed by the treaty, which was that the power should be returned to British Columbia at a point near the border, near Oliver.

I think the question that we should ask here, the question that needs to be asked is: why didn't we tell the Americans right from the start to give us our power back, to deliver it as is prescribed in the Columbia River Treaty, to deliver it to Oliver? Could we not use the power? Should the Americans not have been the ones to have panicked? The Americans would have been the ones, then, to have been rushing around wondering what they were going to do. How could they build transmission lines to Oliver? Could they ever get the environmental approvals necessary to build such a transmission line? I think not.

We should have played tough with them right from the start. We should have said: "No, we're not interested in selling the power, either in short-term sales or long-term commitments, for the last 30 years of the treaty. Give us the power back, because we own it. Yes, you generate it on the American side of the border, but give it back to us. We want it." Let's see how they would have responded. But no, those are not the instructions that we gave to the negotiators. The Premier said right from the start that we were going to explore alternative arrangements.

Right from the start the Americans knew that they had an advantage over us, and that's where the mistake was made. That's where the critical error was made, and that's why we're in the problem that we're in today.

[3:15]

There's no need to panic over this. Those assets are still ours. How the assets are returned to British Columbia -- in what way, in what shape, in what form -- will be determined by us here in British Columbia. Moving a motion in this assembly to condemn the big bad Americans isn't going to solve the problem. Moving an amendment to the motion to talk about an all-party task force isn't going to solve the problem. What's going to solve the problem is to get back to

[ Page 14432 ]

the table at our own time. Because the downstream benefits are not to be returned until 1998, so we have a little time. We don't have to be driven by the timetable of the next election campaign in the province of British Columbia.

The solution is to get back to the table and tell the Americans that this time we're going to get it right: no more false starts; give us our power back; deliver it to Oliver and that's it -- we don't want to talk any further. It's time for us in British Columbia to take a tough stand. We don't have to give in.

Why would the government of British Columbia not be interested in doing this? They recognize, the government have said, that this is a valuable asset. In fact, it's a very important asset. This is not a debate where we're going to be dividing British Columbians between good and bad British Columbians, terminology that I sincerely regret has entered into this debate. This should not be a debate about sovereignty and about bashing our American neighbours. We've seen some of that in recent days as well. This is not a question of our citizenship or how proud or loyal we are as British Columbians.

We can take a tough stand with the Americans without being anti-American. We can vote against this amendment without being bad British Columbians. We can vote against this motion moved by the hon. Premier without being bad British Columbians, because the motion itself and the amendment itself are both flawed in their own ways. Neither of them proposes remedies that are actually going to get us back to the table, to take a tough stand with the Americans and tell them to give us our downstream benefits back -- to return them, as is prescribed in the treaty itself.

The question is vague, though. Why would the government not have taken that kind of approach? Did they have bad advice? Did they feel that there was some short-term political gain that could have been achieved? Were there some power projections in the province of British Columbia which suggested that we don't need the power? I know that many have talked about the electricity plan for British Columbia. In fact, the leader of the Liberal opposition has criticized the government for not having a plan, but there is a plan. B.C. Hydro publishes every year an electricity plan for the province.

When you take a look at their 1994 electricity plan, you'll see many specific comments about the power needs, forecasts and projections for the energy requirements of British Columbia, and you'll see some specific language about the Columbia downstream benefits as well.

For instance, B.C. Hydro was taking a look at planning studies to "continue to monitor the uncertainty related to the status of the Kemano completion project." Interesting. I'm reading from the 1994 Electricity Plan -- the Province of British Columbia, published by B.C. Hydro. It talks about the Kemano completion project and says there's some uncertainty there. So we weren't relying completely on the Kemano power coming forward from Kitimat, from Alcan; that was a factor which was put in. One wonders, because the Kemano project is now not proceeding, because that electricity is not going to be available for B.C.

Hydro: shouldn't we have been taking a closer look at the downstream benefits? According to the action plan established by B.C. Hydro for 1994, they were going to "continue to assist the provincial government on issues related to the disposition of the Columbia River Treaty downstream benefit entitlements."

So B.C. Hydro is looking at this. Hopefully, they're looking at it carefully. We know that the provincial government is excited as well about independent power producers. But where are the power needs of British Columbia going to be met? B.C. Hydro has taken a close look at this. The downstream benefits factor in. If we brought those downstream benefits back, we might be in a situation where we wouldn't have to be pursuing Kemano. That may or may not be a bad thing.

I certainly, for one, am not proud of the way our provincial government pursued the scrapping of the Kemano completion project in a manner that really deserves more criticism than the criticism now being directed towards Bonneville Power Administration. But leaving that aside for now, British Columbia has an energy plan, has an electricity plan, and the downstream benefits factor into that.

It's important to note that every year since the Columbia River Treaty was signed, the Columbia River Treaty Permanent Engineering Board has published an annual report. It's an interesting document. There's an update every year on the Columbia River Treaty power projections and how both sides on the border, the Canadian and American sides, are living up to the terms of the treaty. The most recently published report, for the year ending 1993, talks about a number of key points. It refers to the fact that each entity on both sides of the border has powers and duties. These entities are interesting creatures.

On the American side, the entity administering the Columbia River Treaty is the Bonneville Power Administration. On the Canadian side of the border, the entity -- which was created for this purpose -- is the B.C. Hydro and Power Authority. In the 1993 annual report by the Columbia River Treaty Permanent Engineering Board, it states, under "Powers and Duties of the Entities," that "in addition to the powers and duties specified elsewhere, the treaty requires the entities to be responsible for the following...." And it lists a number of powers and duties.

I want to refer to just two of them that are crucial and very germane to this debate; they're the final two that are listed in the most recent annual report. "The entities, BPA and B.C. Hydro, are required to make appropriate arrangements for delivery to Canada of the downstream power benefits to which Canada is entitled, including such matters as load factors for delivery times, points of delivery and calculation of transmission loss." So B.C. Hydro and BPA presumably have been looking into this.

If they've been living up to the terms of the treaty, they will have been making the appropriate arrangements for the delivery to Canada of the power which is generated on the American side of the border but which is owned by us right here in British Columbia. That should have been done.

The second thing the entities are supposed to have been looking into is the preparation and implementation of detailed operating plans that may produce results more advantageous to both countries than those that would arise from the operation of the plans referred to in annexes A and B. So contingency plans are required for each year of operation by the entities Bonneville Power Administration and B.C. Hydro. Is it not now time to explore what those contingency plans are?

I have more to say about this, but I would like to give leave to one of my colleagues to make an introduction, if I could.

L. Boone: I ask leave to make an introduction.

Leave granted.

[ Page 14433 ]

L. Boone: This is extremely fitting debate, hon. Speaker, because in the gallery today we have a group of students from Canyon Creek Elementary, accompanied by Ms. F. Nekano. They're from Seattle, Washington. I hope that they understand that the comments made in this House today do not reflect on our friendship toward their state and that we are very happy to have them here visiting with us today. Would the House please greet Ms. Nekano and the students who are with her -- some 46 grade 6 students.

D. Mitchell: It's very fitting to have some students here to witness this debate. I should say that at the time the Columbia River Treaty was signed in 1964, I wouldn't have been any older than the students who are here to witness the debate about the second half of the treaty.

I can only hope that in 30 years' time, when students are visiting this Legislature, they can look back over the whole 60-year span of the Columbia River Treaty and talk about the tremendous benefits of that treaty to British Columbia; the role taken by legislators of various governments over the years, including the government of today; and the tough stance we're going to be taking with our American counterparts in this treaty -- that we're not going to be giving in, that British Columbians didn't give in, that we didn't blink, and that we went back to the table and demanded what is ours, which are those downstream benefits, a provincial asset owned by each and every one of us as British Columbians.

There are no good and bad British Columbians. Those who seek to divide the province over this kind of issue do so for short-term political considerations. The initial signatories to the Columbia River Treaty in 1964 had a longer-range vision. They were signing a 60-year treaty. Very few politicians ever think beyond the next election. Very few politicians or elected governments ever think in terms of generations -- 60 years at a time. But in 1964, when the Columbia River Treaty was signed, there was some tremendous vision and foresight about the benefits of that treaty.

There was also a confidence that international resource markets for water and electricity would be even more hungry for the power, energy and water resources that British Columbia has in such plentiful supply -- that those markets would be even greater.

Today we're witnessing a short-term consideration. The Bonneville Power Administration has taken a short-term consideration and decided to step back from the memorandum of understanding it signed. I say shame on them. But there's no need to panic.

I say we need to get back to the table, tell those Americans to deliver the power back to British Columbia, take a tough stance and look them straight in the eye -- but not to panic, not to talk about emergency debates or phony, manufactured political crises, not for the opposition party to be posturing against the government, and not for the government to be trying to take short-term advantage of this issue either. Hopefully, some dispassionate reflection and reasonable concern will achieve it.

But I'd like to say that I don't think supporting this amendment is going to achieve anything. I don't think that supporting the amendment, which is moved for the same kind of short-term considerations that we want to rid ourselves of in B.C. politics, is really going to achieve the objective. In fact, on the motion itself -- about which I may have more to say later -- I regret the language of the motion, which is inflammatory and unnecessary.

No one can predict international commodity resource markets. Whether we look at coal, oil and gas, forest products or water, no one can predict those markets over long periods of time. But we do know one thing: in the province of British Columbia we are blessed with an abundance of these resources that the world is hungry for. Over the course of time.... There are hills and valleys; there are cycles, but over the course of time, British Columbia has benefited. The rise of British Columbia has taken place because of our abundance of resources.

We should never, ever give away those resources for less than they are valued. The valuation of those resources should be determined as much by us as by those commodity markets. We don't have to give them away; we don't have to play the role of hewers of wood and drawers of water anymore.

But we have an asset in our hands -- the downstream benefits from the Columbia River Treaty -- and I urge the government to be firm, to stand tough, to take a second start. They've had a false start in these negotiations. Put that behind us now. Forget the American-bashing; forget the name-calling and the political posturing. Get back to the table, and this time tell the Americans and show them firmly that we're not going to blink. We want the power back. Take it back, and let's move on in British Columbia.

Let's protect the water, which is our most valuable resource, and let's rid ourselves of the kind of posturing that we see with both the amendment and the motion that we're debating here in this House.

W. Hurd: I'm pleased to rise today in support of the amendment put forward by the official opposition. Having followed the debate on Thursday last and today in the assembly, I wonder how many people have actually taken the trouble to secure a copy of the memorandum of negotiators' agreement -- the one that the company has obviously walked away from and the one to which just about every speaker in the assembly has been referring. The opposition secured a copy of the agreement and looked at what was in it. Imagine that -- we read it. It's an important document. I refer to item 3. It says:

"...the legal and technical teams be requested to complete drafting of the definitive agreements by December 31, 1994, and if definitive agreements are not drafted and executed by all parties by December 31, 1995, the transactions contemplated by the statement of principles not proceed, and negotiations between the parties be terminated."

That's what this transitory agreement says. That's the language that $1.2 million in legal fees bought for us in the province of British Columbia. Fine. You go back to the drawing board and get a firm agreement by December 31, 1995, and you bargain hard and you bargain tough.

[3:30]

But you know, this government didn't just do that. On the basis of this flimsy agreement, they borrowed, or will borrow, money for the Columbia Basin Trust. They have signed the Columbia Basin accord, which commits a portion of those downstream benefits to the Kootenays. They have committed themselves to build three hydroelectric expansion projects in the Kootenays, all of it designed to enhance the government's re-election chances. Beyond that, they also included $250 million in this year's budget that they didn't have.

Clearly, this agreement indicates that they didn't have it in their hands. The question you have to ask is: why would any government that purports to be skilled negotiators undertake such a myriad of investments and initiatives without anything firm on the table? That's the issue that causes the

[ Page 14434 ]

opposition such alarm in British Columbia. The fact that the government would borrow money, would put money in the budget that it clearly doesn't have, is an issue that I think should concern every member of this assembly. How can you possibly put money into the budget -- $250 million -- that isn't actually in your possession? You do it, I guess, by a simple bookkeeping shuffle based on an agreement which even the government is now admitting will probably not be found to be legally binding. Because it says right in the agreement....

I would urge the members of the assembly to get their hands on a copy of exactly what it was that the government signed and what it was that they based these myriad of investments on in the

Kootenays.

Earlier in this assembly we debated Bill 7, which set up the Columbia Basin Trust to invest a portion of the downstream benefits in the Kootenays. On March 19 members of the government and the Premier gathered for a signing ceremony in Castlegar with all the pomp and fanfare imaginable. They were talking about investing in the Kootenays and investing in dams. That's what they said on March 19. I want to advise the members what was said by the Minister of Employment and Investment in this assembly on April 19, exactly one month later.

He said: "I want to make it clear that when the trust and the province enter into the formal written agreement, then there is an obligation...." That's what he said. " 'The province and the trust intend to enter into a formal written agreement regarding the content of this memorandum.' Until that agreement is signed, my advice is that there is no legal commitment to proceed with these power projects." That's what the Minister of Employment and Investment said about this ceremony in the Kootenays.

Signed by Her Majesty and by the Premier of the province of British Columbia, entitled "The Columbia Basin Accord," it too isn't worth the legal paper it's written on.

The reason it was drafted by the provincial government had more to do with short-term election planning than with any long-term commitment to the region. We in this assembly have passed Bill 7 into law, which sets up the trust. I hope the people who comprise that trust will take a long look at where the province wants to put their money from the Columbia River Treaty. I really hope they will go back and take a hard, long look at what is happening to energy markets in British Columbia. What is obvious here is that this American corporation has bought itself some time at the expense of the B.C. government.

They held their finger up to the breeze to decide where the price of power was going, and they determined that over the last year, it has gone down and is likely to stay there. Does the government understand what is happening to energy markets out there? It is now possible, with new technology, to generate power using natural gas and turbine technology for a fraction of the cost of hydroelectric facilities. It's a reality of the technological revolution.

The fact is that the rate for the price of international power has gone down; it's half of what it was. It appears obvious that our negotiating team that we sent into action, that we swung into action -- the dream team from B.C. -- negotiated a non-binding agreement that doesn't commit us to anything, and yet they still went out there and put $250 million into the budget. They went out there and signed the Columbia Basin accord with fanfare, pomp and ceremony -- which the Minister of Employment and Investment has acknowledged in Hansard isn't legally binding, just like this agreement we have before us here today.

We on this side of the House are asked to swallow this kind of bargaining and negotiation by the provincial government. Is it any wonder that we need an amendment to the motion which would invite all the parties in the assembly -- even the independent members -- to get involved in these sets of negotiations, because the people of the province have no confidence in the ability of the provincial government to negotiate anything? The downstream benefits will return to the province by 1998. There's no question that's in the treaty; it's legally binding. Nobody would acknowledge otherwise.

But what we have before us in the assembly is a flimsy re-election effort by the provincial government in the Kootenays, based on an agreement which simply will not stand up to any kind of scrutiny.

I'm amazed that people could say we should approach this issue in a non-partisan way. It wasn't the official opposition that held the ceremony in Castlegar with the Premier in attendance signing the Columbia Basin accord, which has no legal impact. It's not binding on anyone, by the acknowledgement of the minister who signed it. All we have from the government is vague platitudes that the people of Kootenays will get their money, but there's no legal requirement for that to happen.

It isn't just the Bonneville Power Administration that signs non-binding legal agreements; it's the provincial government, with the Columbia Basin accord, in Castlegar on March 19. That was a re-election ploy, pure and simple.

Let's talk for a minute about these dams that the people of the Kootenays are being asked to invest in: a billion dollars to renovate hydroelectric projects that, in the opinion of Peat Marwick and Margolick and Associates -- two consultants hired by both the Energy Council and the Minister of Employment and Investment -- don't make a shred of economic sense. They're make-work projects. They don't even reflect the reality of international power markets. Absolutely ridiculous! This whole initiative has been an absolute fiasco.

We're now being asked by the government to accept a motion condemning the company for its determination to get out of an agreement. Obviously they have pursued what I would consider to be expedient and sleazy negotiations, but they were dealing with a willing subject: the government of British Columbia, which hasn't yet signed an agreement, during the course of this entire two- or three-year debate, that will stand up after the next election.

All the people of the Kootenays wanted was a share of the downstream benefits, which I think everybody in this House supported with the creation of the Columbia Basin Trust. All we did with Bill 7 was set up a trust to receive the money and invest it. That bill had the support of everyone in this assembly, because the principle of having the money returned to the region that had suffered the economic and environmental damage was a principle that was well established.

The other part of it.... This memorandum of understanding says: "Yes, we're going to get your money back for you, but we're going to invest it in the projects that B.C. Hydro wants to build." I mean, that's not the kind of local, community-based decision-making that the government has been trumpeting. In fact, I say again that this Columbia Basin

[ Page 14435 ]

accord -- which was signed March 19 and acknowledged a month later by the Minister of Employment and Investment -- has no legal authority either.

This whole process has been a deck of cards that has collapsed under the weight of the reality of declining markets for hydroelectric energy in the western United States. The fact is that the price of hydroelectric energy is half what it was a year and a half ago. In the end, I suppose, the company is going to use the escape hatch that they were given by this government to get out of the agreement.

If this government hadn't had a re-election timetable tied to a spring or a fall election, how much of this would have happened? Would any government in the first year of its mandate have been willing to bet the store on an agreement as flimsy as this one? Would any business operate that way? Would any business go out and make a commitment to borrow a billion dollars for three dams? Would any business put in its budget $250 million that it didn't have and didn't have a legal right to receive during the course of the current fiscal year? Who would operate that way?

The government sees nothing wrong with operating that way, and I suspect that's why it has lost the confidence of the people of British Columbia. People know a smoke-and-mirrors campaign when they see one; they know a re-election campaign when they see one.

I just look at this entire process that has gone on, and I say to the government: "Get back to the bargaining table -- absolutely. Be tough in the negotiations -- absolutely. Make the company aware that by 1998 they will have to return 1,500 or so megawatts of electricity to the province" -- whatever it might be valued at at that time. But I issue the government this warning: energy technology is undergoing rapid change in the western world. There are cogeneration projects; there are natural gas-fired turbine projects; there are alternatives to hydroelectric energy. The government had better be aware of that when it goes into this negotiation.

Negotiate tough and hard, and get the kind of agreement that we need and that the people of the Kootenays have indicated that they want to see for the entire province. But don't put money into the budget that you don't have. Don't sign these Columbia Basin accords -- with pomp, ceremony and pageantry -- that have no legal meaning. Don't tell the people of the Kootenays that you're investing your money with a top-up approach when in fact B.C. Hydro is giving us a top-down approach, with three hydroelectric dams. Just get on with the job and negotiate an agreement which is final and binding.

And above all else, keep an honest budget until that agreement is signed and we have a firm commitment from both parties to get on with the job of returning those important benefits to the province.

J. Tyabji: I hope that the people of British Columbia were listening to the speeches of the Liberal opposition, because I think they'll be able to hear in advance what the arguments of Bonneville Power will be at the negotiating table.

What I find most regrettable is that the Liberals have pretended with their amendment to this motion, to try to have some sort of non-partisan approach to the serious situation facing the people of British Columbia, and have chosen this forum to advance a partisan attack on all the points that will be brought forward at the negotiating table on behalf of the people of British Columbia. What bothers me, and I certainly have a lot to say about the motion and the amendment....

If we're going to be trying to score cheap political points in this House, we should recognize that we will be doing that at the expense of the people of British Columbia -- who will have to live with whatever deal is going to be struck, in light of the withdrawal of Bonneville from the memorandum of understanding.

It bothers me because, as somebody who had a problem with the original deal -- or who at least recognized that a deal was in the process of being negotiated -- and who felt that it had to be pushed further, to find that the position advanced at that time was being eroded by members elected to this Legislature is shameful. Their constituents should be aware that every time they stand up and try to get headlines on the backs of the NDP government, they do so at the cost of the taxpayers of this province, because they weaken our own government's negotiating point.

It's absolutely disgraceful, and I hope the people of this province pay attention to that. There isn't a point that the Liberals have raised that isn't going to be raised as well by Bonneville Power. I find it interesting that on the one hand, they come forward with an amendment that's supposed to be non-partisan and tell the government to go in and negotiate from a tough position, and negotiate strongly but don't do so with these points; and on the other hand, they recognize that power prices have gone down and that you didn't have any legal weight in your agreement. And they attack all these positions.

If we're only talking about hydro, then we've missed the essential point of this debate. One of the main reasons that that memorandum of understanding fell through is that the original negotiating position of the NDP government with Bonneville Power did not include a provision for water. That is one of the central points of this debate that no one is talking about -- other than the members of the Alliance -- because water is going to be the bottom line.

The Liberals are talking about the price of electricity going down and all the things that Bonneville Power has brought forward as reasons for them to back away from the memorandum of understanding. That is not the bottom line in this debate. Anyone who has followed the history of British Columbia from a resource development perspective will recognize that it was in the 1950s when we first began to put in place provisions for large-scale water diversions, for changing the way the water in this province was flowing in its natural form, and started to redirect water flows with the dams.

[3:45]

We know that Williston Lake is the largest artificial lake on the planet, that that was created as part of the hydro and water projects, that the North American Power Alliance discussions began in the fifties, and that the engineers in the United States and Canada began to look at British Columbia as one of the main sources of fresh water for the United States. If anyone should doubt whether there is a need for British Columbian water -- particularly Canadian water, as it flows in B.C. -- we have only to look at some of the periodicals, books, debates on NAFTA, debates on the free trade agreement, and the essential debate around water. If I could read from an

article by Jamie Linton, who writes for the Rawson Academy of Aquatic Science.... He talks about the economics of water export and whether there is a demand for Canadian water. He says:

[ Page 14436 ]

"Since the Second World War, and until very recently, there has been an alarming increase in demand for water, particularly in the western U.S., due to expanding irrigation and rapid population growth. As a result, the availability of unused water has declined. The Colorado River is already overallocated and the most important source of groundwater in U.S., the Ogallala aquifer, is being depleted."

We know that in British Columbia we have large water resources and that those water resources will fall under the jurisdiction of two international treaties -- namely, the Free Trade Agreement and the North American Free Trade Agreement -- with respect to how they will be allocated in future. How we control the tap on that is where this debate and the debate on the Water Protection Act should have been directed.

It's no coincidence that the day that the memorandum of understanding was thrown in the trash can by Bonneville Power was the very day we entered second reading debate in this Legislature on the Water Protection Act. When this government went forward to negotiate that memorandum of understanding, they expressly said they were not going to talk about water, and water was not on the table. I know that, because the Alliance leader and I as a colleague met with the negotiators, and they said that water was not on the table.

What I think is interesting is that my expectation would be similar to what Bonneville Power probably expected: given that we had the Free Trade Agreement and the North American Free Trade Agreement defining water as a commodity and listing the ways in which water had to be provided for investors who signed on to that agreement, and given that Canada could be held liable for not providing that water, and with all the legal ramifications of water not being on the table, Bonneville Power would probably have been surprised to find that under the Water Protection Act, jurisdiction for a tariff rate on that water fell to the Crown of British Columbia, the province of British Columbia.

That was a very important point to make, because what that said.... And I would congratulate the government on the one hand for having the courage to bring that forward, and on the other hand condemn them for not realizing that that was going to be an important point to discuss with the Americans. But what the government was saying was that no more will there be private investment or investor potential in water as a commodity in the private sector. What the government is saying -- and we will get onto that debate at some other point -- is that the Crown will retain the right to have those licences and to charge money for the water.

If you sit down at a table, and water is not up for discussion, and you're of the impression that the water comes with the hydro; that the levels of Lake Koocanusa, Williston Lake or the Arrow Lakes system are going to be automatically dependent on the hydro; and that if you sign a deal to purchase a certain level of hydro, there will automatically be an understanding -- whether it's a wink or a nudge or a little bit of a jab with the elbow -- that the water is going to continue to be provided at the rate at which it has been provided before, which has been at great cost to the Kootenays; and if that understanding is suddenly shattered by a Water Protection Act that says, "Wait a minute, water wasn't on the table, because it's not on the table...." Notwithstanding the Free Trade Agreement and NAFTA, the provincial government still retains the right to charge tariff rates on that water, provided those tariff rates are consistent for Canadian users and American users.

If you were at that table, signing a memorandum of understanding, and you suddenly found out that the reason you weren't talking about water was that water was going to be covered under something else, you would be pretty upset.

You would be particularly upset if you knew that hydro rates were down and there were a lot of other incentives to back away from the table. You could make all the arguments, but very few of those arguments with respect to the market that Bonneville Power is putting forward today to back away from that memorandum of understanding are trends that couldn't have been predicted at the time they signed that deal. It's not as if suddenly they woke up and found that the market had changed. It wasn't as if these trends hadn't been developing -- the movement toward gas, the movement toward conservation and the movement toward different sources of energy. Those were all there.

The only thing that changed was that the provincial government brought in something that would empower them to start to charge money for a resource that the United States has had free for a very long time, and that many of us in this province believe we should have been talking about decades ago. A long time ago, we should have sat down and said: "All right, if these are our resources and this is your level of need, let's hammer out an agreement, independent of hydro, that deals specifically with water."

When we get back to the Water Protection Act, we can obviously talk in more detail about what this government is planning to do with that act -- what's behind the Crown retaining the right to charge money for those licences and for the volume of flow, and to what extent they have actually canvassed the legal ramifications of what they're trying to do in that act.

But when we look at the motion before us, it's very simple. It is: "Be it resolved that this House condemn the American Bonneville Power Administration for breaking a solemn commitment on the delivery and disposition of the Canadian entitlement under the Columbia River Treaty." I would hope that every member of this House is able to get behind a motion like that. Surely to goodness, anybody who has ever been in business.... When you sit down and negotiate an agreement and come up with a memorandum of understanding while the legislation or the legal documents are being drafted....

Unless something serious happens to make you go back to the starting point, it's a pretty serious issue to back away from a memorandum of understanding. When you've sat down and put your signature on a document, you recognize that that's not an idle signature; that's not something where you sat down over a cup of coffee and decided that it was a good idea to move in that direction; this was something where they already had the basics of a legal agreement to take to the lawyers for the lawyers to draft up something more binding.

So if we're going to talk about what it is that brought us to the serious situation that we're in today, the one word is "water"; that's the reason that we're in the situation we're in today. All the other ingredients were already there. Why we have in front of us the amendment that that motion be amended so that given that Bonneville's decision to withdraw from negotiations may seriously impact all British Columbians and most particularly those residents of the Kootenays, let's have an all-party task force whose mandate will be to investigate and develop a strategy to ensure British Columbians receive maximum benefit. Given this amendment

pro-

[ Page 14437 ]

posed by the Liberals, I wonder at the substance of their debate so far. I don't understand how we could possibly have an all-party task force to develop maximum benefit if we're going to eliminate from our discussion all the very points that the government is trying to argue, through their legal counsel, with Bonneville Power. An all-party task force should be in place for the resources of this province. That all-party task force should be this assembly. Through this assembly....

If we took this assembly more seriously and actually had fixed sittings and sat more than three and a half months of the year, this assembly, on behalf of our constituents, could then start to debate some of these issues -- one of the most important issues being the future of the Kootenays and of the north, given the history of this province with respect to hydro development and water diversion.

Those are things that we should have brought before this House three and a half years ago; we should have brought it before this House a decade ago. Those things are long overdue. We don't need a task force; we don't need another travelling road show; we don't have to finance a committee of MLAs. This assembly should be debating these issues. When we debate those issues, we should have some respect for the fact that everything that will be raised in Hansard becomes a resource for those people who would choose to use this assembly as a way to weaken the position being taken forward on behalf of the people of British Columbia.

The amendment is something that I think is not relevant to this debate, because it's too little too late, and it also flies in the face of anything the Liberals have contributed to this. It's unfortunate that the only place that we see an attempt at a non-partisan action is not on a front-page headline somewhere; it's not the grandstanding that we've seen taking place everywhere else; it's in a motion that the people of British Columbia probably won't even realize, in large measure because it defies what they're saying in the House anyway.

What we're having broadcast over the radio and through the print media -- and, I'm sure, available to the negotiators now -- are a lot of partisan attacks. We're not getting to the heart of this, and we're not talking about where the province should be going as we move forward.

If that memorandum of understanding will not stand, what are we to put in its place? What are we prepared to bring to the table? What are we taking to the table, and under what jurisdiction? Where are we going to get some sort of legitimacy in the process that evolves when the memorandum of understanding breaks down? We're not getting that debate to the people of the province.

When we talk to the people in the Kootenays, as we have done, many of them are extremely anxious about their future, and they're extremely angry that there have been partisan attacks on something that is going to mean we're all carrying the can for the end result. That anger is not limited to the Kootenays. In the Fraser Valley, people are angry with the kind of politics that has been played with their tax dollars. You can walk down the streets of Vancouver and have people angry, because the central issues are not being debated.

If the bottom line here is how we go forward from this point, surely to goodness we should have a silencing of those people from this point onward. If you have a difficulty with the government's negotiating position, approach those government members and talk it out with them. If you have some constructive input, which is something most needed in this debate, then bring it forward, because a constructive approach is in the interests of all British Columbians.

The position of the Alliance is certainly that if we are going to move forward from this point, and we must do so, then let's do so with the recognition that the people of the Kootenays have a future on the line, and that they should have some mechanism through which they will have direct input into what happens from this point onward. If we're coming back to the first point in negotiations, let's talk about everything that needs to be talked about. Let's talk about what the people of British Columbia would be prepared to accept on hydro and water.

There was a gentleman from the Williston Lake area here today in question period who is concerned about the lake levels there. If we go to the Kootenays -- and I was at a conference in Kelowna the other day -- people from the Kootenays were talking about the lake levels in the Kootenays, about the fish kill and about the recreational problems and environmental devastation.

Let's talk about those things, and let's say that from this point onward we will have an opportunity. That opportunity will be to allow the position of the people of British Columbia to be advanced in these negotiations, that position being that our resources are very important to us, that the downstream benefits are due to us and that they are due to us in the amount of $250 million in this fiscal year. Let's stop attacking the government, and let's start looking at what is due to the people of British Columbia. If the government has put $250 million in this budget, it is the responsibility of all these members to try to make sure that the money gets into the budget in this fiscal year.

When we do that, we are doing a service to the people of British Columbia, who are, unfortunately, extremely cynical about the process of politics today, and for very good reason. An inclusive process, and using this as an opportunity to move forward, is in the best interests of all the voters and taxpayers of British Columbia. If we can shed our partisan coats for the rest of this debate and get down to the work of the debate, which is to bring forward constructive input, then I think perhaps this debate will be more than the usual hot air we see in this chamber, and I look forward to the debate on the main motion.

[4:00]

Deputy Speaker: I thank the member for her comments, and recognize.... [Laughter.] After that note of levity, I now recognize the member for Delta South.

F. Gingell: I think it's wonderful that the member for Okanagan West is wanting to get it together. When you have a caucus of one -- you started with a caucus of six, but now you're down to a caucus of one -- that's pretty simple. That's an easy exercise: what goes around comes around.

[The Speaker in the chair.]

Interjections.

F. Gingell: We're doing fine, thank you very much.

This is an interesting debate. When other members stand up and speak, I listen and wonder whether they've been listening to the same debate I've been listening to, because they say some strange things.

[ Page 14438 ]

First, let's recognize one thing. This agreement that was signed was not a memorandum of understanding. The previous speaker, the member for Okanagan East, kept referring to it as a memorandum of understanding, but it's not. It's a memorandum of negotiators' agreement. Negotiators are given a set of parameters, a framework with which to negotiate, and they go away and try to work out an arrangement. They cannot make any firm deals, but they can certainly explore and, one would hope, clarify all the issues that will form part of the final agreement.

All the way through this document, it says it's not final and not binding, and notes have to be exchanged before it is. It would seem that for bringing up that subject and mentioning that, we're unpatriotic British Columbians, according to the Minister of Employment and Investment.

We've also had a great many lectures from various members of this Legislature about how you negotiate. Well, in my years in business, I always believed and was led to understand that the way you make an agreement is that you have to make an agreement that works for both sides. You have to ensure that your agreement has all of the right ingredients in it and that it works for both sides.

Now, we in this province have walked away from other agreements. The NDP government in 1972.... One of its first acts was to walk away from an agreement with the Seattle light and power company with respect to raising the level of the Ross Dam. I believe they did the right thing. There were major environmental issues involved in the question of raising the level of the Ross Dam that were unacceptable to British Columbians. I applauded the NDP government for taking that action then, and I believe they did the right thing.

This NDP government also cancelled legally binding agreements that had been entered into with respect to the Kemano completion project. I applaud them for doing that too. That also, I believe, had environmental consequences that were not worth the risk.

What we've got to do here is to recognize the issues involved in making this particular deal. What does this deal involve? Well, it involves British Columbia's agreeing to limit the capacity of electricity it can draw. It cannot take more than a certain number of megawatts at any one moment in time; British Columbia has agreed to restrict the annual take to 950 megawatt-hours.

C. Serwa: Not megawatt-hours.

F. Gingell: No, that doesn't sound right. The capacity deals with megawatts. I think the member for Okanagan West is correct. I haven't described it exactly accurately. But we've agreed to cut a piece off the outside that deals with both capacity at any moment in time and total volume. We've agreed to allow that to happen between the year 1998 and the year 2024.

When I questioned the Minister of Finance on the issue of whether the proceeds from the sale of electricity which the Americans are going to take delivery of from the years 1998 to 2024 are properly includable in the income for the year 1995-96, the minister all of a sudden came up with a different series and different standards of accounting practice. It was interesting, because this morning there was a letter written by the Minister of Finance, printed in the Vancouver Sun, in which the minister defends the quality of accounting in British Columbia.

She says: "British Columbia's financial reports conform to accounting principles and are further endorsed by the auditor general." When I ask her questions in the House in question period about the issue of accounting practices -- because the comptroller general stated very clearly that for us to include this income in the 1995-96 budget.... The minister accuses me of nitpicking. She further went on to say:

"I take considerable offence at the comments of this member maligning the comptroller general of this province and suggesting that our comptroller general would provide opinions that he did not stand behind. I think the shame...is on that side of the House for suggesting the comptroller general would in fact give an opinion that he did not stand behind."

Well, Mr. Speaker, everybody who has read the opinions.... I'm sure that half of the government people didn't read them, because of the conclusions they came to. On October 26, 1994, in a letter from the comptroller general to the auditor general asking the auditor general for an opinion, the comptroller general said: "This has the advantage of probably being the most understandable by the man in the street, but it's contrary to our accrual accounting policy -- i.e., the benefits are receivable and the province does not have to do anything further in order to receive them." We all know that that is not the case.

We have to live up to the commitments, the contractual obligations, that the province has under the Columbia downstream benefits treaty. Things have to be done in the future to earn those revenues.

The minister says: "Oh well, if the money is going to come in in 1995-96, why don't we just include it? Everyone will understand that best." The accounts of the province, known as the public accounts, already contain amounts of revenue far in excess of $250 million which are deferred to future years because they have not been earned.

In fact, at March 31, 1994, there is included in the liabilities of the province, not yet included in the income or in the budget, an amount of $344 million: for motor vehicle licences and permits, $104 million received but not yet earned; for water rentals and water recording fees, $70 million received but not yet earned; for petroleum, natural gas and minerals leases and fees, $23 million received but not yet earned; for Medical Services Plan premiums from people who pay their medical premiums in advance, $53 million received but not yet earned; and another miscellaneous amount of $94 million -- all of which are included because the province has services and responsibilities to deliver to earn that income.

And in this arrangement, it is exactly the same. The province has responsibilities to deliver services to ensure that the levels of the lake are correct, to ensure that the dam weirs and doors work properly and that the dams are staffed and operated in accordance with the agreements. There is simply no way that that money should have been brought into this year's budget. It is unfortunate that it was, because I believe that the issue having been raised and then this proposed deal falling apart is what has made this government so angry -- and angry they are indeed.

The Minister of Employment and Investment's posturing is both transparent and pathetic. He's trying to position himself as B.C.'s David, bravely facing the evil American corporate Goliath, the dream of any would-be socialist leader, and name-calling anyone not willing to accept this performance an unpatriotic British Columbian. Scream as he might in the Legislature about saving B.C., it is really his political reputation that is on the line. We all want to find a solution. We all want to get the best deal for British Columbians.

[ Page 14439 ]

When the Social Credit administration of Premier W.A.C. Bennett sold the downstream benefits for some $254 million, the NDP opposition screamed murder. In hindsight, they were right, because in the early 1970s we had a major upset in the crude oil market which caused the price of crude oil to move from $2.50 or $3 a barrel up to $29 and $30 a barrel. What we had sold so cheaply based on this early pricing, suddenly we were not getting a fair price for. But a deal had been made, and we had sold the benefits and taken the money in to have the funds to pay for the construction of the dams, and that was that.

It surprises me that this government decided that it would sell these downstream benefits anyway on the long-term deal from the year 1998 to the year 2024, because we all know that commodity prices change, and they can change fairly dramatically. I can assure you that people in the oil industry in the exporting states, Nigeria, Russia, Iran, Iraq -- well, of course, Iraq is not exporting very much at the moment, but I'm sure it will come back on stream at some point -- Kuwait, Libya, are all working out schemes whereby they can push the price of crude oil up.

If you look at the price of crude oil at the moment -- I haven't looked at it recently, but it's roughly $20 (U.S.) a barrel -- based on what's happened to the U.S. dollar in relation to world currencies, the price of crude oil adjusted for inflation is substantially below the price that it was all through the 1970s and most of the 1980s.

[4:15]

So commodity prices will change. Why is natural gas so cheap right now? It's cheap because the demand for natural gas went up. To meet that demand, the infrastructure was put in place to be able to move it from where it is produced to where it is consumed. Oil companies went out and explored for more oil and gas. Everyone in British Columbia is really pleased that there were major discoveries made in northeastern British Columbia in the Peace River area and in the Rocky Mountain Trench -- I'm trying to think of the name of the major sour gas field there -- but there were huge volumes of natural gas that came up.

The infrastructure is in place. The producers want to sell it. The people who transport natural gas want to transport it because they've got to pay for their capital investments. So at the moment natural gas, which is cheaper to move than electricity because you don't get the line losses, produces electricity at this moment in time at very low cost. Hydroelectricity has the advantage -- or disadvantage -- that all the costs are up front. The costs of maintaining the generators are relatively low in comparison.

Crude oil prices are more flexible to world market conditions, because you can put crude oil in a truck, a pipeline or a ship and move it around the world to where the demand is. Natural gas is much less flexible. To move large volumes of natural gas by any means other than pipeline is very expensive.

But as this government knows, from what's happened to the price of lumber in the last little while.... You know, they've suggested that they're going to get $430 million into Forest Renewal B.C., because they believed that the price of 2-by-4s and lumber would stay up. But it hasn't. It follows market demand, and the prices are down.

I believe that in the future the price of natural gas will rise. At the moment, natural gas -- per Btu, which is the right way of comparing costs -- is substantially cheaper than crude oil. It will change as crude oil prices rise, particularly in the U.S., where many major generating stations and power users are organized to use their choice of crude-oil-based products -- diesel, usually, or some form like bunker, or coal or natural gas. They're on natural gas right now, but as natural gas pricing goes up they will switch.

The value of the downstream benefits, I'm convinced, will become more in the future than it is right now. So why do we lock ourselves into a deal? Surely not for the short-term advantage of getting $250 million, putting it in the budget, waving a flag and saying we've got a balanced budget -- even though any responsible accountant, in my opinion, believes that not to be the case. We should look at the needs of the American energy market. How can we best make a deal that works for both sides, so that we in British Columbia get all the things we want and the Americans get what they want?

I hear the Minister of Employment and Investment posturing, throwing his fists around and saying we're going to play hardball with this. If they had a legally binding agreement as they say they have, they wouldn't have to do that. But he knows that he moved too quickly. He needed to get his i's dotted and his t's crossed. He was too intent on counting his chickens before they'd hatched. He even was trying to count the eggs before they were laid.

An Hon. Member: Cluck, cluck, cluck, cluck.

F. Gingell: That's very appropriate, coming from the backbenchers of the NDP government. There's been too much crowing and not enough scratching: that's the problem. We shouldn't approach negotiations with the attitude I hear emanating from the government benches.

As I've said before, we should look for solutions. You know, the only time in my years in business and in practice as a CA and on school boards that I've heard the type of rhetoric that comes from the Minister of Employment and Investment is when I was on a school board and we were negotiating with the unions. If you're in business trying to sign a major deal with PetroCan or Imperial Oil or whoever it might be, you first of all try to understand what they need out of the deal, and you know what you need out of the deal, and you try and craft arrangements that will look after everybody's need.

That's what makes good long-term-payoff partnerships. Shouting and waving one's fists around and threatening to finance eco-terrorists -- maybe that's a bit of an exaggeration, but environmental groups -- who will cost your customer bond is simply not the way to do this.

I look forward -- if the minister still includes me in his group that goes to the meetings of PNWER, the Pacific Northwest Economic Region, where the province of British Columbia works with the states of Oregon, Washington, Idaho and the province of Alberta -- to see how we can cooperate together to improve the economic opportunities that the Pacific Northwest has, particularly on the Pacific Rim. It will be interesting to know if the governments of those states have been listening to this debate and listening to what the minister has been saying, because he will be somewhat embarrassed, I think.

But I think we can all rest easy. No one's listening. We may go back to Hansard to get the quotes, but you can see what the circumstances are.

[ Page 14440 ]

Our amendment was an honest attempt to sit down quietly with the government to see if we could help, if we could assist in coming up with solutions so that all British Columbians would benefit. I'm sorry that this offer hasn't been taken in that manner. We will support -- as we have previously said -- the motion that has been put forward by the Premier, because we believe that all bodies should negotiate in good faith. If you have a negotiator's agreement, the logical conclusion is a final deal. We join the government in condemning Bonneville Power for walking away from this arrangement.

But let's look at their responsibilities, let's look at their needs, let's look at our needs, and let's take a sensible, thoughtful, logical approach to negotiating a good agreement, one that serves the needs of both sides.

Hon. B. Barlee: I'll take a kind of oblique look, perhaps a different look, at this from several different angles. I'll certainly look at it from the historical angle. I was born in Grand Forks -- that's in the boundary country, which is on the edge of the Kootenays. I've lived in Rossland, so I'm quite familiar with the area. And I think there is a question of natural justice; I don't think that's been met.

To elaborate on that, I think I should say that we should take a look at this region as it looked in the early forties, the fifties and sixties. Now, when you look at the Arrow Lakes region, it was in those days....

An Hon. Member: How old are you?

Hon. B. Barlee: I went in there 50 years ago, when I was a kid, and it was really quite unique. It was the last accessible wilderness in the interior of British Columbia. It wasn't connected by road; it was connected by a sternwheeler called the S.S. Minto. The Minto was really quite unique. It was a CPR sternwheeler that plied the waters of the Arrow Lakes, both the Upper and Lower Arrow. It stopped at some magnificent towns that are now under water. Arrowhead was an old CPR town. It's under water; it was flooded because of the 1964 agreement.

Needles is under water, and that unique place called Galena Bay, which all of you, of course, are familiar with, is also under water -- and part of old Nakusp, which was probably the most beautiful town in British Columbia. There are some very, very spectacular-looking towns. Grand Forks is one; Nakusp is one; Nelson is one; and you can go on and on.

It was a unique lifestyle there. When the Minto went up and down the lake, it would stop for a white flag, and that meant that you had mail to give to the purser, or you had a box of apples -- or maybe two boxes of apples, if you were very lucky -- or there was an accident in the family. The sternwheeler simply pulled up on the shore right there and extended that....

Interjection.

Hon. B. Barlee: We didn't burn the Minto like your government did, though. You burned the Minto to the waterline -- the Social Credit Party -- which I though was a shame. I managed to save the running lights however, hon. member for Okanagan West.

So the Minto was the lifeline of that country. There were a lot of remittance men in that area. Remittance men were people who were given a certain amount of money, usually to leave England, sometimes in a hurry -- certainly not unique to the Arrow Lakes, not unique to....

Interjection.

Hon. B. Barlee: My family excepted, of course.

Interjection.

Hon. B. Barlee: I'll try to ignore these savage barbs from the opposite side.

These towns were perhaps original to that part of the Kootenay country. What happened essentially was this. We struck a deal in 1964, and I imagine there was a memorandum of understanding at that time as well, if I remember correctly. It wasn't really an especially good deal for Canada or British Columbia. Several people pointed out -- certainly General McNaughton did in the initial stages -- that this was not a good deal for British Columbia.

I was just talking to someone who's a teacher in Grand Forks and he said: "You know, there are other offshoots of that, too." I said: "Certainly there are." They destroyed the salmon runs on rivers like the Kootenay and certainly the Columbia. When some of the dams went up -- the Grand Coulee for instance -- the salmon run was gone. We were never recompensed for that. On the Little Slocan the salmon run was gone; on the Kootenay it was gone -- one of the great salmon-fishing rivers in the world. On the Slocan and even on the Kettle River, where my family lived for many years, that salmon run was done.

So they have certain responsibilities. That's only part of it. They flooded some of the most arable land in that West Kootenay country without even a by-your-leave. In fact, people were given precious little to set themselves up again.

So it's much more than just money involved. We can handle the money. I went over the figures the other day, and when I say that we can handle the money, we can handle the money very well. In our retail sales, according to Stats Canada -- which is certainly not a social democratic organ -- we lead the country again in 10 percent retail sales -- the highest in Canada. In fact, hon. member for Okanagan West, it is actually the highest number in North America -- the highest increase in retail sales.

[4:30]

By the way, hon. member for Okanagan West, I should inform you that the second-biggest increase in retail sales is Ontario, which is also an NDP government, followed by Saskatchewan at 8.5 percent. The four governments that are last, actually, are led by Frank McKenna -- that genius from New Brunswick -- and they're minus 3.3 percent in retail sales. It has gone down. We go the other way; we average about 10 percent each from the various provinces. And we have always underestimated the revenue coming into the Crown, because essentially our economic strategy is pretty sound. I know the members don't want to hear this, so the less you want to hear it, probably the more truthful it is.

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When I look at economic performance.... You don't just stop there; you must go all the way down the line. When we track economic performance, we should track everything in that area. We should track hotel occupancy. The average hotel occupancy in North America is 65.2 percent.

An Hon. Member: What's this got to do with the Columbia River Treaty?

Hon. B. Barlee: It's very important, you see. Where do we get the money from? We get it from a long-term strategy on the economy -- a long-term economic look at it.

Interjection.

Hon. B. Barlee: Where else do we get it? Well we get it from tourism. In tourism we led the country again, according to the Conference Board of Canada. They say we'll lead it again in 1995, which is this year, and they're right. So what do we do? We take a look at all angles of this treaty, and all angles of the treaty are quite important. It's still very important that we look at the historical background of this area.

The Arrow Lakes, which you are all familiar with, were named after the Lakes Indians, which is a nation that is virtually extinct now. It got its name because they spotted a cliff, noticed an old, dense tree hanging down the cliff, and used it for target practise; hence the name Arrow Lakes. Unfortunately, the Arrow Lakes of today are not the Arrow Lakes of 1964 or 1944.

When you travel into that area -- one or two members from the opposite side are quite familiar with it; the rest of you are essentially coast people and you don't understand the interior too much -- you pass through the Monashees, you come to the Arrow Lakes, you pass through the Selkirks, then the Purcells and then into the Rockies. It's very close to my heart because I was raised there, and, of course, you have a fondness for an area you are raised in.

We've mentioned the MOU. It's a standard form; it's an accepted business practice. The interesting thing is that a negotiator from Bonneville Power Administration stated -- and there's one word that's operative: "We're walking away from a foolish business deal; it's as simple as that." But what he admitted was that it was a deal. That's the word: not an idea, not a proposition, but a deal. And I think they have to live up to the deal. They also go onto say: "We will be investigating the option of building a transmission line." That, of course, will come out at Oliver.

I don't think they'll ever build the transmission line, and I'll tell you why. That is a very, very sensitive area. That is the extension of the great American desert, and it extends up through the United States, into the southern Okanagan and farther north than that.

Interjection.

Hon. B. Barlee: Yes, it is essentially, that's right.

It was called the great American desert in the 1890s, if you go back a hundred years, and it has some unique denizens there. It has the burrowing owl, the blue skink, the sage thrasher and a number of other rather unusual specimens that are found only in that part of western North America. It's really quite unique.

So they won't bu