Finance and Government Services - Issue No. 3

2001 Legislative Session: 2nd Session, 37th Parliament
SELECT STANDING COMMITTEE ON FINANCE AND GOVERNMENT SERVICES
MINUTES AND HANSARD

Present: Blair Lekstrom, MLA (Chair); Tony Bhullar, MLA (Deputy Chair); Jeff Bray, MLA; Ralph Sultan, MLA; Harry Bloy, MLA; Kevin Krueger, MLA; Barry Penner, MLA; Brian Kerr, MLA; Lorne Mayencourt, MLA; Ida Chong, MLA; Joy MacPhail, MLA

1. The Chair called the meeting to order at 9:02 a.m.

2. Opening statements by Blair Lekstrom, Chair, Select Standing Committee on Finance and Government Services.

3. The Committee heard the following witnesses on the matter of pre-budget consultation:

    1)   Sander Wrixon and Downie:
            Brian Downie
    2)   City of Fort St John:
            Mayor Steve Thorlakson
            Colin Griffith
    3)   David Twombly
    4)   Gayle Flavelle
    5)   Central Interior Wood Processors Assocatiation:
            Gary Aven, President
    6)   District of Tumbler Ridge:
            Mayor Clay Iles
            Fred Banham
    7)   Northern Lights College:
            Greg Larsen
            John Birnie
            Ellen Corea
    8)   Dennis Mracek
    9)   District of Chetwynd:
            Mayor Charlie Lasser
            Councillor Bob Nicholson
    10) Darleen Miller
    11) Jim Podger
    12) Northern Lights Real Estate Board:
             Lloyd Smith
    13) Peace River Regional District:
             Director Karen Goodings
             Director Larry Houley
             Director Albert Erbe
    14) City of Dawson Creek:
             Mayor Wayne Dahlen
             Jim Chute
    15) District of Taylor:
             Mayor Fred Jarvis
             Terry Martens
    16) Linda Nash

4. The Committee adjourned at 1:21 p.m. to call the of the Chair.

REPORT OF PROCEEDINGS
(Hansard)

SELECT STANDING COMMITTEE ON
FINANCE AND GOVERNMENT SERVICES



CONTENTS

		Page

Presentations		26
	B. Downie	26
	S. Thorlakson	28
	C. Griffith	30
	D. Twombly	31
	G. Flavelle	32
	G. Aven	37
	C. Iles	40
	F. Banham	40
	G. Larsen	42
	D. Mracek	44
	C. Lasser	46
	B. Nicholson	48
	D. Miller	49
	J. Podger	51
	L. Smith	53
	K. Goodings	55
	L. Houley	56
	A. Erbe	57
	W. Dahlen	58
	F. Jarvis	59
	T. Martens	60
	L. Nash	61

Chair:	* Blair Lekstrom (Peace River South L)
Deputy Chair:	* Tony Bhullar (Surrey-Newton L)
Members:	* Harry Bloy (Burquitlam L) * Jeff Bray (Victoria–Beacon Hill L) * Ida Chong (Oak Bay–Gordon Head L) * Brian Kerr (Malahat–Juan de Fuca L) * Kevin Krueger (Kamloops–North Thompson L) * Lorne Mayencourt (Vancouver-Burrard L) * Barry Penner (Chilliwack-Kent L) * Ralph Sultan (West Vancouver–Capilano L) * Joy MacPhail (Vancouver-Hastings NDP) * denotes member present

Witnesses:

Gary Aven (President, Central Interior Wood Processors Association)
Fred Banham (District of Tumbler Ridge)
Wayne Dahlen (Mayor, Dawson Creek)
Brian Downie
Albert Erbe (Peace River regional district)
Gayle Flavelle
Karen Goodings (Peace River regional district)
Colin Griffith (City Manager, Fort St. John)
Larry Houley (Peace River regional district)
Clay Iles (Mayor, district of Tumbler Ridge)
Fred Jarvis (Mayor, district of Taylor)
Greg Larsen (Northern Lights College)
Charlie Lasser (Mayor, district of Chetwynd)
Terry Martens (Treasurer, district of Taylor)
Darlene Miller
Dennis Mracek
Linda Nash
Bob Nicholson (District of Chetwynd)
Jim Podger
Lloyd Smith (British Columbia Real Estate Association)
Steve Thorlakson (Mayor of Fort St. John)
David Twombly

B. Lekstrom (Chair): Ladies and gentlemen, if I could ask you to take your seats, we will begin.

It's now 9 a.m. Good morning, and I would like to welcome everybody who is here this morning. We are beginning our meetings of the Select Standing Committee on Finance and Government Services, and it's certainly an honour to be able to begin those meetings in the north and in particular in my hometown of Dawson Creek.

I would like to start off by saying a few words about what the committee's mandate is, and then what we will do is pass it off for the introductions of each of our members on the committee.

Our specific mandate is to examine, inquire and make recommendations with respect to the prebudget consultation paper that has been put forward by our Minister of Finance. We are required to conduct public consultations across the province and put together proposals and recommendations to be submitted. For the members of British Columbia that are unable to attend any of the 16 meetings that will be held across this province, we also have the ability for written submissions. Also, the website is up. The information is on the back table for people who, after listening or thinking about different ideas and possibly weren't able to attend, can put those down and forward them to us. They will receive equal understanding and consideration in the development of our report, which is to be submitted no later than November 15.

I would like to apologize, as well, for the short time frames that many people have been given in order to come and make presentations to this committee. The consultation paper that I'm talking about is available on the back table. If you haven't already received a copy, I would encourage you to look at it. It's a very interesting position that we're in, and it's truly an honour for all of us. This is not any one political party committee. It is a committee of the Legislature, and with us we have Joy MacPhail, the leader of the New Democratic Party, as well. Again, I don't want to stretch out and get into the introductions. I'll allow that from each of the members. But we expect to learn from each and every person that presents to us, and it's our job to listen and to do what we can with the information. I think every British Columbian realizes there are some challenges ahead of us, and we are here to listen to what your priorities are and to try and learn from you, as well, and put together a report that will reflect the priorities of British Columbians right across this province.

Everything that will be said is being recorded by Hansard, so there will be a full paper available for the people. It will be public. We have Hansard staff members with us here today, Pat Samson and Catherine Schaefer, and our committee's researcher is Josie Schofield.

With that, at this time I would like to begin by asking the other members of the committee to make their introductions, and then we will begin the process. I will begin with Lorne Mayencourt.

L. Mayencourt: My name is Lorne Mayencourt. I'm the MLA for Vancouver-Burrard. It's a great pleasure to be here in Dawson Creek today. Last night I had an opportunity to see the northern lights and a northern fight. [Laughter.]

L. Mayencourt: Thank you very much. I'll turn it over to my good friend on the right.

B. Kerr: My name is Brian Kerr, and I'm the MLA for Malahat–Juan de Fuca on Vancouver Island. I'm certainly enjoying this trip. Brian is a colleague of mine. We're both chartered accountants, so I'm hoping I can get some information from Brian and find out what's happening here in Dawson Creek.

K. Krueger: I'm Kevin Krueger of Kamloops–North Thompson, a 1972 graduate of South Peace Secondary School. I'm pleased to be back in the Big Sky Country. Thank you for having us.

I. Chong: Good morning, everyone. I'm Ida Chong from the riding of Oak Bay–Gordon Head in the greater Victoria area.

A. Stokes: My name is Anne Stokes, and I'm the Committee Clerk. I'm a non-political member of the committee. I provide the administrative and procedural advice to the committee members.

T. Bhullar (Deputy Chair): Good morning. I'm Tony Bhullar. I'm the Deputy Chair of this committee, and I'm from Surrey-Newton. Thank you for welcoming us to your town.

J. MacPhail: My name is Joy MacPhail, and I'm the MLA for Vancouver-Hastings.

J. Bray: I am Jeff Bray. I'm the member for Victoria–Beacon Hill, which is the riding that holds the Legislature, among other things.

R. Sultan: My name is Ralph Sultan. I'm the member for West Vancouver–Capilano. The last time I was in Dawson Creek, I was hoping to help promote a large mining project which unfortunately, like so many projects in the last decade, was cancelled. So I'm here to learn how we can get this economy going again.

B. Penner: Good morning. My name is Barry Penner, and I'm the MLA for Chilliwack-Kent. It was just a couple of years ago that I was last in Dawson Creek, then as a member of the opposition. The B.C. Liberal caucus came to Dawson Creek, and along with Jack Weisgerber, we held a meeting right in this room to

listen to people in this community give ideas for the future. We're here again to hear what you have to say.

H. Bloy: Good morning, everyone. I'm Harry Bloy. I'm the MLA for Burquitlam, which is a new riding in the lower mainland.

As usual, I can come back to something I forgot. I'm Blair Lekstrom. I am the MLA for Peace River South and the Chair of the select standing committee. To my right is Tony Bhullar, who is the Deputy Chair.

There may be times when members are coming and going for different reasons. That is a possibility. It's not an intent to walk out on any one presenter. There are some other issues that may have to be dealt with. If the need arises where I will have to leave the chair, Tony will take over as Chair at that time.

I would like to thank everybody for their introductions, and at this time we will begin with our first presenter. With us this morning we have Brian Downie. Good morning, Brian. Welcome.

B. Downie: Thank you, Mr. Chair and members of the select committee. I'm very pleased to be able to represent my firm, which is Sander, Wrixon and Downie of Dawson Creek and Fort St. John.

I'm here to give you the oversight as to certain areas that I feel the government should be looking at to be able to bring our government, our economy and our province back into a competitive nature. I've given every one of you some speaking points that I will be going over in the next nine minutes — I've already used one minute of my ten-minute presentation — and I will keep it at that time.

The very first point is the re-establishment of B.C. as an economic leader. There are certain things that the new government has implemented, one of them being a drop in provincial income tax. The previous government blocked any corporate rate. However, there are certain other things this government has to look at, and one of them is the top rate.

Included with the package that I gave you were three sheets. One was the points, and then there were two small schedules. The next schedule is the business tax rates and small business threshold comparisons between British Columbia, Alberta and Ontario, which basically are the three most competitive markets for companies and brainpower, so to speak.

If you'll look at British Columbia, these rates are effective January 1, 2002. So they're creeping up very closely. British Columbia, for corporate tax rates for small business corporations under $200,000 taxable, is 4.5 percent. If you look at Alberta and Ontario, theirs are going to be implemented over a longer period of time. But by 2004, Alberta will have a 3 percent rate as compared to 4.5 percent for ours. Ontario drops to 4 percent.

Another interesting concept that's been taken on by Alberta and Ontario is the fact that they've now used a $400,000 threshold as being an idea. After talking to Brian and reaffirming in my own mind, the $200,000 threshold has been around since the early seventies. It hasn't taken into account the times, inflation or anything else allowing small business — and large corporations in fact — to be able to compete, to retain profits or to expand their facilities and expand their markets, etc., with after-tax dollars.

If you'll look at the $200,000-to-$400,000 area, British Columbia will have 13.5 percent on anything in excess of $200,000. Once the implementations are made for Alberta and Ontario, Alberta's $200,000 to $400,000 will be 3 percent as compared to our 13.5 percent. Ten percent is a very substantial amount of money. If you look at it on an individual corporate basis, it's only $20,000. But that $20,000 multiplied by numbers of corporations adds up to a lot of investment income that those companies are able to invest back into employees and back into capital for expansion, etc.

For over $400,000, Alberta and Ontario have decided that 8 percent on those high-income corporations that don't qualify for the small business rate…. Ours is stuck at 13.5 percent. It's something that this committee should seriously look at to be able to bring us into a competitive area within Canada and especially with our most competing provinces, those being Ontario and Alberta.

An interesting thing that came out of one of our policy reviews, which we give out on a quarterly basis through the institute, is the migration of B.C. individuals to other provinces. Since 1998 the province has lost 47,000 people to Ontario and Alberta. Those 47,000 people have caused massive drops in personal income tax and massive drops in corporate income tax, because a lot of those moves and migrations have been because their corporate headquarters have relocated. That's a scary thing. We have to be able to bring those businesses back to this economy. We have to make ourselves competitive. Without making ourselves competitive, they're not going to come back. I think that's a shame. I think we have to be able to look at that very seriously.

The other little handout that I gave you is something that I keep on my own desk so I can sit down and see it. As most of you are aware, we're only eight miles from the Alberta border. My practice deals about 50 percent with Alberta residents and 50 percent with B.C. residents. As you can see, with the changes that have been announced by this government, the differences between individuals who live and work in Alberta, excluding the provincial sales tax cost…. The income tax costs are very similar up to the $70,000 taxable income level. So there's really not much change. B.C. is now competitive in those areas.

Where it starts to fall apart is in the higher-income levels. The most drastic change is for the individuals earning $250,000. The tax cost is $12,000 higher for those individuals. The reason I bring it in at $250,000 is that a lot of those individuals who moved with corpo-

rations from Vancouver to Edmonton and Calgary are earning $150,000-plus a year. So you take those individuals and multiply by $77,000, of which $30,000 will be lost revenue or lost tax dollars to the province. The math adds up very quickly, and the spinoffs on that add up very quickly. Again, it's very important that this committee look at making B.C. competitive, and I think that's critical. I can't stress it any more.

The other thing I think this committee should be looking at in a very general sense is making sure that you look at all taxes to businesses, whether or not it's the B.C. capital tax, which is now starting to make their thresholds higher…. I find that B.C. capital tax is really, if you look at it, a tax on property. It's a way for the provincial government to tax properties that are now being taxed by municipalities. It's their way of taxing those same municipal properties. But what it also does is cause problems, an example being that an individual company with $5 million worth of paid-up capital might pay $25,000 in B.C. capital tax. But that company could have lost $3 million or $4 million during that year, so they're getting taxed on capital even though they've lost money. So there are inequalities in the B.C. capital tax, and I'm well aware that there are other jurisdictions that do have B.C. capital tax. But again, it comes down to competitiveness. Do we want those businesses in this province to be able to make us grow? The more people we have, the more tax dollars we have, and the more business we have allows us to come out of the reductions in those areas that we've faced in the last eight to ten years.

The other areas I'd like to talk about is the long-term debt management, and I'm hoping that I'm not going too far off here. There was a panel that was reported to in July of 2001, and it was done by the fiscal review panel. The deficits in the short run and some associated increases in debt will be necessary in the province until proper restructuring of government can take place. However, the panel pointed out that unless the deficit problems are addressed, there is a danger that the amount of debt will get out of hand. As deficits continue, mounting interest costs make further deficits even harder to control.

We're pleased that the government has strengthened the Balanced Budget Act in the last legislative session and encouraged that the new government has mandated a balanced budget by the fiscal year 2004-5. However, one important element is missing in that, and that's the fiscal management goals of the province as a long-term debt management plan. It's my opinion that the debt management plan with measurable benchmarks for debt reduction should be a crucial part of the government's fiscal management strategies.

Under 3, "Budget transparency: towards an unqualified audit report," the new government of British Columbia is to be congratulated for fulfilling its truth-in-budgeting promise through an amendment to the Budget Transparency and Accountability Act by legislating generally accepted accounting principles — or GAAP, for you non-accountants — in the B.C. government, making the province a leader in open and transparent budgeting. While the previous B.C. government tried to restore credibility to the budget process with the Budget Transparency and Accountability Act, the original legislation did not mention and did not mandate GAAP. In particular, failure to follow GAAP meant that schools, universities, colleges and institutes coupled with health authorities, which we have given the acronym SUCH sector, were not included in the government's summary of accounts. As a result, the auditor general of British Columbia issued a qualified opinion in the public accounts of the province for being incomplete. A qualification by the auditor signifies a concern that the financial statements of the public accounts have been qualified by the auditor ever since the 1996-97 fiscal year. It's our recommendation that that happen.

Finally, another important aspect of budget transparency is the reporting of the annual deficit surplus. In 1999 the budget process review panel, in the Enns report, recommended that the annual surplus deficit be reconciled with the change in debt. Unfortunately, the previous government did not act on this important recommendation. The change was called for because it is possible for the province to record a surplus while the province's debt increases. For example, in the 1999-2000 fiscal year the province recorded a $52 million surplus, but the total provincial debt increased by $2.1 billion. The public would benefit from reporting the deficit and surplus based on the changes in those provincial debts.

I must also commend the new government for committing to follow GAAP within the next two and a half years. However, I think two and a half years is probably a little far out. If you can move it ahead, that would be even better. The less unqualified opinions that our auditor general gives are the best.

That covers my presentation. I would be more than happy to answer any questions. If not, I'll defer to my esteemed colleague.

B. Lekstrom (Chair): Thank you very much, Brian. I think it was a very in-depth presentation. I would look to members of the committee. Are there any questions for Brian at this time?

B. Penner: What reaction, if any, have you heard from your clients to the personal income tax reductions announced by the new government in June and the other tax changes announced in July? Have you heard some positive feedback, or are your clients even aware of those changes?

B. Downie: My clients are very aware of those changes. They're very happy with the changes. I will reiterate what I said to the panel last October — I don't see any of those members on this committee at this time, with the exception of Ida — which was that we are in a real different situation within this province and this area. Because we are eight miles from the border, there's a lot of major corporations operating out of this area. That means they're earning very large amounts of money. Those shareholders and those employees are

moving their operations from Dawson Creek to either Beaverlodge, Hythe or Grande Prairie, which allows those shareholders to save phenomenal amounts of money during that period of time. With these changes, it's now not as beneficial for them to do that move strictly for tax purposes; but it was, prior to this government's change in those tax rates. So you have stopped some of the upward swell.

B. Downie: No. The tap's not changed. We've still got other things to do. That's the corporate side. That's why that was the very first item on my agenda.

I. Chong: Brian, can you give us an idea that…? You've noted that you're very close to the Alberta border. You've noted that we need to make B.C. competitive. How soon do you see a return in terms of growth in the economy, should those changes happen? If they were introduced, would you see a notable change in six months or one year? Are people waiting patiently? Can you tell from the clients that you're servicing?

B. Downie: I don't think you're going to see a massive influx of people returning. They've built infrastructure inside Alberta. A lot of that infrastructure and a lot of those expansions were because of the B.C. capital tax. Why should they pay $25,000, $50,000 or $75,000 for having the benefit of living in British Columbia?

I think what you're going to find is that as long as this government becomes more friendly to business, and the more friendly this province is to business…. This will give revenue back to the province to be able to do social programs. Don't get me wrong. I'm not saying that all of my recommendations are strictly to help business; they are. But the point that has to be remembered is that if business is thriving and business is making profits, those profits are being reinvested into the communities where they're at. They're hiring people, which causes more jobs, which causes more disposable income. The chain of events is there.

I think that the businesses that have moved to Alberta or to Ontario are waiting for stability to come back into this province, to draw them back — to say: "Look, we are the environment where you should be doing it." There are a lot of things other than the finance side. There are lots of other areas that have to be looked at. But based on the finance, to get to your point, I don't think it's going to happen in six months, and I don't think it's going to happen in a year. It's going to take some confidence-building. It's going to have to be this government saying: "We are open for business." Mr. Chairman has done that in the city of Dawson Creek for the last four years of his term, and it's worked. He has been very open in how he did that, making sure that this particular area was open for business, and he did everything he could to do that. I think this government has to do the same thing.

B. Kerr: Actually, it's more of a statement than a question, Brian. We have eliminated the B.C. capital tax.

B. Kerr: We reduced it for the first half, but in January I think it's eliminated.

I. Chong: No. On September 1 we reduced it, and next September the other half will be eliminated.

B. Lekstrom (Chair): Well, Brian, I would like to thank you. Again, we will try and keep on schedule. We have a number of presenters today. We will have an open-mike session to wrap things up this afternoon for people who were unable to make presentations. Again, thank you very much for taking the time.

B. Downie: Just one last comment. If any of the panel members have not received the B.C. Checkup, which is a document that's produced by the Institute of Chartered Accountants on an annual basis — and this is its second printing — this particular one will be the benchmark for this government. I think it's very critical for this particular committee, along with any other MLAs who are interested in receiving this report. If you are interested in receiving the report, you could leave your card with Blair. I'm going to be meeting with Blair on Friday up in Fort St. John, and if he would be kind enough to collect your cards, I would be more than happy to get you a copy of that Checkup so that you can read it. It's a very good report; it's very informative. It gives the state of the economy in B.C. in many aspects.

B. Lekstrom (Chair): Our next presenter this morning is with us. We have His Worship Mayor Steve Thorlakson and with him Colin Griffith, the city administrator for the city of Fort St. John. Good morning, and welcome to our meeting this morning.

S. Thorlakson: Actually, it was Friday. Certainly lots of familiar faces and some new ones that I haven't had the privilege of meeting. It's nice to see them again and to welcome back Barry, Ralph, Joy, Ida, Kevin. Kevin, you were born up in this country. Welcome to God's country.

Thank you for the opportunity to make this presentation. We've read the material from the government website and sincerely appreciate the magnitude of the

task your committee, the government and the province as a whole are facing. If there was any doubt, the Premier's speech last week at the UBCM erased those doubts. The scope of input you'll be receiving across the province will be broad and comprehensive, but for our part we wish to narrow the focus in order to deal with all five points as they relate to one central issue: resource development in energy and forestry.

You're no doubt aware that the oil and gas industry generated $1.8 billion in revenues in the province last year. While declining prices will likely reduce that in the current year, direct revenues from oil and gas are expected to outstrip all other direct resource revenues combined for the second straight year. This is a direct result of your government's continuation of the progressive reforms of oil and gas initiatives 1 and 2 and continued U.S. demand for natural gas. Regulatory streamlining, the creation of one-stop shopping through the Oil and Gas Commission and the strategic investment in oil and gas service roads have resulted in tremendous returns to the province.

The North Peace Rural Road Task Force clearly made the business case that by upgrading oil and gas service roads, expanded operating seasons for the drilling and seismic industries would result; $20 million per year being invested has more than repaid itself in the first year alone. Further expansion of the operating season to drive further investment by the energy industry will require aggressively expanding this program to accelerate the return to the province. The results of the strategic investments in these areas have been stunning, and there is more to come.

We concur with independent sources, such as the Canadian Association of Petroleum Producers and the B.C. Business Council, that oil and gas revenues will be the leading revenue source that ensures that Finance Minister Collins's goal of a balanced budget in 2004-05 is achieved. We believe that the next phase of encouraging enhancement of activity and therefore provincial revenues must focus on two streams.

Comparisons with Alberta dominate discussions of B.C. improving economically and competitively. The reality is that B.C. already has many advantages, with larger gas pools and higher drilling successes than Alberta. It is our contention that if it were proven that there are slightly higher costs of doing business in B.C., they are more than offset on the bottom line. The best proof of this lies in the phenomenal increases in activity to date and the confidence in B.C., as shown by Duke Energy's acquisition of Westcoast Energy.

The drilling and producing companies know the B.C. advantage. Now we must jointly persuade the mostly Alberta-based service companies of the advantages of basing permanently in British Columbia.

Firstly, a coordinated effort between the province and B.C. oil and gas service centres must be undertaken to dispel the myth of the Alberta advantage. The increased personal and corporate income tax revenue and improved stability to our communities are obviously well worth working towards.

Secondly, just as the province invested strategically to improve exploration activity with virtually instant payback, we believe the province must ensure that the B.C. service centres can compete with our Alberta neighbours. To attract the oil and gas service companies to locate permanently in B.C., we need to provide the type of comprehensive community services and infrastructure that their employees and families have come to expect in Alberta.

Over a ten-year time frame from 1996 to 2006, our community's immediate service area population will have grown from 18,000 to 31,000. The oil and gas growth and the expected 3,000 more residents resulting from the Slocan-LP OSB plant will be impossible to serve from a residential and small business tax base. Fort St. John's documented infrastructure deficiency of over $110 million looms over us like a dark cloud. Substandard infrastructure and services, combined with high taxes, will defeat the government's goals and our goals.

The province has recognized that the service centres in the northeast did not have adequate access to the industrial tax base — activity that they service. A grant program to partially offset the lack of industrial tax base was instituted in 1998 for a ten-year period. We cannot sustain the demands of growth and the infrastructure backlog without direct access to the industrial tax base that drives the demand for services.

We are well into a process that we call grass-roots government, engaging rural and urban citizens of the North Peace to reinvent local government in the North Peace in a progressive, efficient, effective and fair manner. We are a community and council that strongly support free enterprise and your government's goals to strengthen the economy. However, our first responsibility is to our taxpayers, and we will not ask them to bear a disproportionate share of the costs of economic growth. Our community has experienced the reality of bankruptcy. When the bust hits, you don't have linkage to the industrial tax base.

Your government's initiatives, such as the community charter, must not only empower local government but also ensure that service centres such as Fort St. John, which are bearing the brunt and costs of growth, have direct access to the resources and revenues required to sustain our community and the province as a whole.

In summary, you asked for recommendations on five points: expenditure priorities, revenue priorities, re-establishing B.C. as an economic leader, performance measures and other ideas. We are proud and entrepreneurial British Columbians and know that you appreciate that the oil and gas, forestry and agriculture in our region contribute hugely to the wealth and opportunities that will make B.C. number one in Canada again. However, there is an old saying: you must invest a dollar to make a dollar. For too long our people have tolerated substandard infrastructure and services and an inferior quality of life. Strategic reinvestment and policies will enhance the province's bottom line while

also allowing the citizens of the Peace to become the envy of Alberta, not the other way around.

B. Lekstrom (Chair): Thank you very much, Steve. That's certainly a very thoughtful presentation, one that I know we share in the north. We face many challenges, and it's very interesting to hear what you have to say this morning. Are there any questions?

L. Mayencourt: You mentioned that there is a $110 million infrastructure deficit. Can you tell me what the nature of that is?

S. Thorlakson: In a quick nutshell, if the street, road, streetlight and drainage infrastructure in the city of Fort St. John were to the standard that's accepted as normal in the bulk of resource communities — Prince George, Williams Lake, Terrace, Quesnel, Kamloops, Cranbrook — it would take $110 million to bring it up to that standard. A combination of circumstances make a long, long story very, very short. Significant development was uncontrolled under provincial jurisdiction prior to 1975, which allowed bedroom communities to develop without infrastructure of any kind — without roads and as a matter of fact without sewers. The pressures on the community to bring that up to any kind of a current standard are just huge.

R. Sultan: Given your sense of the direction the community charter has headed into — and I appreciate that it's still the very early days in terms of final documentation — are you encouraged? Does it seem to be moving in the direction of giving you the revenue sources that you need?

S. Thorlakson: Not completely, but that's why we're going to be making submissions to the Community Charter Council when it does its consultations as well. The Premier — I think he actually stole this line from Joyce Harder — has used an expression many times: one size doesn't fit all. In fact, what works in the south Island, the southern interior and the northern interior doesn't necessarily work here in the Peace because of the uniqueness of our industrial tax base being scattered over thousands and thousands of square miles as opposed to concentrated in plants, such as the forest industry or the mining industry are.

We want to encourage that community charter and ensure that not only does local government have…. I've had a lot of involvement in that process with my years on the UBCM executive. We want that to work not only for the traditional but also for those communities where those solutions need to be beyond a standard cookie-cutter template.

J. MacPhail: I notice that today, Steve, we're spending a lot of time with local and regional governments here. What plans, if any, do you as local government, and then with your regional governments, have to resolve the first nations conflict with oil and gas development? Are there discussions?

S. Thorlakson: On a personal and somewhat informal level, I've had discussions with chiefs, former chiefs and some of the elders. That's more a matter of personal relationship building, which seems to be the best way to engage in communication. There have certainly been some steps, very recently, up the Blueberry where the chief and council obtained an injunction against some of their own members to try to help resolve the issues. I know that the new oil and gas commissioner has quite a challenge on his hands in that regard, trying to build those bridges. We're committed to working to assist with that in any way, but we're not so naïve as to think we can go out and fix it.

S. Thorlakson: Through the UBCM community consultation process, we've been involved in that and have had meetings with some of the first nations in the area and continue to do so. We've just hired a new senior staff member who will have specific responsibility, because of his vast experience, for building on first nations to local government relationships as well.

C. Griffith: In addition, in the grass-roots public consultation process we have a citizens task force that's going out and consulting with communities in the rural areas. We do have one representative of the aboriginal community on that citizens task force that's involved, because it includes a lot of areas where some of the lands are certainly involved in local government issues. So they are involved in that grass-roots government process.

J. MacPhail: Is it through the Treaty 8 process that you liaise, or is it beyond that?

S. Thorlakson: No, it's more effective levels — direct with individual bands, individual members, chief and council.

B. Lekstrom (Chair): I see no further questions at this time from members of the panel. Your Worship, I would like to thank you and Colin for coming down and taking the time. I know it was very short notice. Our time frames for the public consultation and then putting the final report together are very short, but I thank you for taking the effort and time to put forward what I think is a very thoughtful presentation.

S. Thorlakson: Thank you, and we may take advantage of the opportunity to file additional information prior to the deadline.

Our next presenter this morning is David Twombly. David, if you would like to come forward to the mikes. Good morning and welcome.

D. Twombly: Good morning. This is something we've already had discussions on between you and I directly, and I'd just like to bring it up before the whole panel here.

D. Twombly: I understand that you're looking to cut health costs, and this particular presentation will aid you in doing so, I believe. It's one of the unique situations where you can do so, and it regards level 2 disabled persons under SDES. I've made some proposals here that will help these people, make them healthier and keep them out of hospital, because when they go to hospital, their health costs are horrendous.

Proposed: a $600 per month shelter allowance to better reflect current rental housing costs, especially with the higher natural gas costs. Two, support needs to be adjusted to a five-week month, adding an additional week of support for the two to three times these occur during the year. Three, support rates need to be increased to about $200 to $225 per week. This is for singles. These rates have not increased significantly in over ten years, and it's high time we saw a major increase.

I believe there are approximately 6,000 people at SDES level 2. I'm not sure of that number, but I believe that's what it is. So those increases should only cost about $10 million to $15 million a year, and it will save possibly as much as ten times that amount each year.

Also proposed is No. 4: clawbacks of income to 25 percent of income earned by these clients and started only after about $600 in earnings. The work these clients get is normally short-term and only occasional employment. This will assist these people to supply their own needs, where possible, for durable goods. This move will also save more than it will cost.

Five, remove the saving limits for these people. If they can save up enough money so that they may become self-supporting through self-employment, again this will save government more money. Give them back their annual bus passes. The $45 per year saving is costing you far more than what it will cost. It's already costing more than that.

Return the glasses and corrective lenses to a two-year replacement. Three years is too long and damages the eyes, increasing health care costs down the road.

Eight, restore the aids for daily living program so that these people can get the items they need to live with some kind of dignity, if not without pain.

Finally, in Dawson Creek arrange for a dentist who will take these clients without additional charge. We still cannot access care locally but are forced to go to Fort St. John at least twice — first for the assessment and then for the appointment.

If these are implemented, I believe the savings to government will be significant and will far exceed the cost of implementing these recommendations.

B. Lekstrom (Chair): Thank you very much, David. One thing you started off with was looking to cut health costs. We're trying to work within the budget. It's our commitment that we will not cut the amount of funding that we provide for health care or education at this time. Like any business — and government is business — we're not in the business with the bottom line of making profit. Our profit is the delivery of services, and our ability to provide those in an efficient and effective manner is what we're after.

You've touched on a couple of things just prior to recognizing questions from the committee. The issue of the dentist is one that is being worked on. We've had that discussion, and I thank you for bringing those issues forward along with some colleagues in Dawson Creek. There are a number of things. But your presentation, I think, was very thoughtful and put forward very well.

At this time, I would look to members of the committee if there are any questions for David.

J. Bray: It was a very good presentation, David. You may not know that I actually worked for that ministry for the last 13 years, and I agree with No. 2. That's an issue that's been a concern for people on all income assistance, Youth Works as well as level 2. So I'm glad you've raised that again.

I'd like to ask you a question, though, with respect to encouraging an increase in benefits in the hopes of encouraging people to work. How do you feel about making level 2 disability benefits subject to review every five years?

D. Twombly: The people who are on level 2 are permanently disabled. Reviewing it is not really going to help a lot. They just did a review recently of the level 2, and I don't think it really changed a great deal. All it did was cause a great deal of inconvenience for the clients. They all had to go and get new collectors reports and all the rest of it.

The level 1 is a different thing; it's reviewed annually. I have spina bifida. That's not going to get better. There's no point in reviewing it, because it's just not. If you increase my income or others' level 2 income, then the chances are that we'll have a better chance to get off of it through financial success and not through…. The health is already…. That issue is gone. For these people their health is not going to get better, but they might be able to do something if they have more money.

R. Sultan: David, an excellent presentation. I wonder if you could help me understand the model im-

plicit here, though — that if you give the disabled more money, the chance that they get off these support programs increases. You refer to the rather tantalizing prospect that each and every year we could save ten times the amount of money spent. Can you maybe give us an example? Just help me understand a little bit better the process of how that would be achieved.

D. Twombly: Right now these people are virtually borderline starvation cases — okay? If you make them healthier by giving them more money, they will spend a whole lot less time in hospital, which is the only place they wind up when they can't make it. If they have more money, they will stay out of there a lot longer. That will save us a significant amount of money, because when they get there, they need all the supports.

B. Lekstrom (Chair): Are there any other questions from members of the committee?

Seeing none, David, I would like to thank you for your presentation. Also, the information we've discussed already — I've already forwarded that. I will also take the opportunity on behalf of the committee to forward this to the Ministry of Human Resources, on behalf of yourself from the committee's presentation.

D. Twombly: Thank you. With regard to the previous presenters, we must get rid of the B.C. sales tax for this area, this side of the mountains. It's killing business like you wouldn't believe. And with regard to the other regional governments in this area, particularly the Peace River regional district, it needs to be removed and put back under the city authority. We have two levels of government, and they fight each other for resources.

As our next presenter this morning, we have with us Gayle Flavelle. Good morning.

I'm going to beg the committee's indulgence. I'm not a public speaker by any means.

B. Lekstrom (Chair): Oh, just feel comfortable. We're going to sit here, and it's like having coffee at the kitchen table.

G. Flavelle: I'd like to start my presentation today by thanking the Liberal government for the opportunity to speak here. I would also like to thank them for the proposed tax breaks they're offering to the working population of B.C. The extra income will be a welcome addition to my family's budget, but with these tax breaks I have some major concerns.

As you know, my name is Gayle Flavelle. I'm very familiar with living here in the north. I was born and raised and educated in Dawson Creek. I spent a few years on the coast going to college — not by choice but by necessity. In the days when I wanted to further my education, there weren't any colleges in this area. There was only a vocational school that didn't offer the courses I wanted to attend.

I work right now in the community social services sector. I supervise two group homes for mentally and physically handicapped adults. I've been accused of being a glorified, overpriced babysitter. I provide badly needed life skills to mentally and physically handicapped adults. I educate them; I train them. I get them out into the community. I support them in supported employment. I teach them the skills that are required to contribute to the community and the society as a whole.

I have some concerns that I wish to express to the Liberal government over their proposed 50 percent funding cuts they want to implement. I also have some questions for the Liberal government that I hope they will be able to answer in the future. I don't expect all the answers here today.

The doctor shortage here in the north, the ratio of doctors to patients, is phenomenal. It's at crisis levels. It's difficult to get in to a doctor when you're sick. Appointments are made one month to six weeks in advance. If you have an emergency and need to see a doctor during the daytime, you can go to a walk-in clinic and sit there and wait 45 minutes to three hours before you see anyone.

There's no better service at the hospital. You still have to wait just as long to get in to see a doctor. When you finally get in, you're rushed. They don't have enough time to properly spend with you. You leave wondering if you're diagnosed correctly. I see this repeatedly. I've sat in these waiting rooms, and I've felt their effects.

Doctors are leaving this area constantly. They're not being quickly replaced. I know of two doctors who are leaving before December. I haven't heard of any doctors coming in. In the clientele that I service there are a few who go to these two doctors, and they're being told that there are no doctors taking new referrals. I'm concerned about the funding cuts and what they will do to this already aggravated situation.

Nurses — I know there is a shortage all over this province. I can't speak for all other areas, but I can for this area. I have friends who are qualified nurses and work locally in these hospitals. They're tired, they're overtaxed and they're making mistakes. And we're at risk. I'm majorly concerned about the long hours that these nurses are constantly asked to do. I'm concerned about the mistakes that are being made in the hospital system, and nobody's taking notice.

When the clientele that I service go into these local hospitals, I am burdened with providing care for the clients I serve in these hospital settings, because the nurses can't do it. They're untrained, they're unqualified, and they don't have the time. I'm illegally asked to hand out and give medications in a surrounding where I'm not allowed to do it. But we do it because the cli-

ents need the care. We make the sacrifices. I'm majorly concerned about where I stand when mistakes are made and the wrong medications are given.

I can't see the 10 to 50 percent decreases as being beneficial in this area. Most costs in this area are phenomenal. The amenities are next to nonexistent. We already travel out of this area for any kind of specialized treatment — cancer treatments or appointments with specialists. This is already a financial burden on the people who live in this area.

Someone I know in the community was recently diagnosed with insulin-dependent diabetes. They had to wait two weeks to get a hospital bed in this community. It increased their health risk. They couldn't work while they were waiting, and it put a lot of pressure and stress, financially as well as mentally, on that family.

Home care and Pharmacare are really big concerns to my family right now. My mother is 81 years old. She lives in the Peace River area and has for 57 years. She's never been a burden to this government or any other. She's spent most of her life raising children and paying taxes. These last few years have been unkind. She's developed a lot of health issues. I can go into medical terminology, but I'm sure many of you would understand the conditions that she suffers from. She fell last May, and she broke her hip. She has osteoporosis. The surgery wasn't overly successful. She can't weight-bear. She needs a walker to get around. She needs assistance in her home. She needs somebody to come in and assist her with meal prep and bathing. We've been given two hours a week, and we're told we're damn lucky. The bathing isn't a health care issue for this woman.

Now, my family has tossed around ideas. We've struggled with how to come up with plans to help her. I have a family to support; my income is needed. If I quit and moved down to Dawson to support my mom, I lose my income and become a burden on the system itself. With the home support we do get, they won't assist with or provide any cleaning. That's been a major cutback with the government. My mother has asthma; she has emphysema. She's on oxygen 24-seven. She's allergic to dust. She's incapable of doing her own cleaning. I travel 46 miles to assist whenever I can. It makes for long hours, long days. I work in an environment that takes 12 hours of my time. A couple of my children are still young, and the burden is falling on them to do some of this work and pick up some of the slack.

I can't see where you're going to take the 10 or 50 percent cuts from my mother. There are long waiting lists for extended care homes in this area. They're already overtaxed; they're already overburdened. There's already a bed shortage. Most of the people in this area have to leave this area and their families to get services in acute care facilities. I've worked to support my children most of my life. I've never been a burden on the system, but I'm going to have to be if I have to quit and assist my mom.

Pharmacare is another major concern. The government is talking about cutting out Pharmacare. My mom's medication is extremely expensive. I can't afford to assist her in this area. She's going to be given choices about whether to buy medication or buy food. I don't know what I'm going to do when it comes to assisting her with her choices. She has a limited income; she's on a limited pension.

The community social services sector that I work for, the Fort St. John Association for Community Living, is a non-profit organization. With the last round of negotiations and a collective agreement, the government hit us with a 1.5 percent clawback. There's no more left to take back. Where's the 10 or 50 percent going to come from? Client food? There are staffing shortages already. Staff are overworked. Stress has been increased by 100 percent in two years. Accidents and illness are way up. We can't keep qualified workers in the field because of burnout. Workers will be put at greater risk, and there will be injury with multilevel care and shortages of workers if we continue with the staffing shortages in the overburdened homes. Staff injuries have already increased. This has become a burden on compensation. The level of care is on a downward slide. We already do more with less. Everyone we serve and everything we do in this field is already rationed, measured and accounted for. There is no excess.

There's an aging population in our local communities, both in Fort St. John and in Dawson Creek. This aging population has handicapped children still at home. Where are these people, these adults, going to go when these parents are no longer able to care for them?

We've already discussed acute care facilities. This is not an option. There's a bed shortage. The nurses do not have the skills, the ability or the time to take on this select, special care. The cost to train and open more acute care homes to accommodate the growing percentage in our community will cost more than the estimated funding cuts. Do we go back to institutions? I thought we didn't like the cost of them to begin with. We sold this idea of deinstitutionalizing to the general population to begin with based on the theory that these people are part of our communities, part of our society, and we are responsible for them.

Education. I'm scared as hell about what this is going to do to my children. I have an 18-year-old daughter. She just graduated in June. It was an extremely proud day for me and her dad. She wanted to go to college this September. We couldn't afford it. She's working. Are the tuition fees going to be raised? Is she going to be able to stay in the north? Is the funding going to cut the teachers and the courses for her to go to?

I have a 12-year-old son. Every year his classroom size gets bigger and bigger and bigger. He now has 36 kids in his classroom. The teacher has less and less time to spend with him. When he has problems at school, he has to wait until his parents get home to go over his work with him, because they don't have the time. He has kids with behaviours in his classroom, and the teacher is so busy working with these behavioral kids

that kids are going through the system uneducated. There's no funding for aides. These sizes are too big.

Our kids are one of the greatest natural resources we have, yet we're throwing their education right down the toilet. These kids are going to be looking after you and me somewhere in the future. What do you want our care to be based on — greed? Or do we want some kind of decent care? All of us, including this committee, are aging. Most of us are one head injury away from needing a service that I provide. Until it affects us directly, we don't seem to pay attention.

The high school in our community was built to accommodate 472 students. The last three years, the population enrolment for the school has been between 825 and 900 students. This year they're building onto it. I was told that it will still be undersized when completed. They never started construction until August. The completion date for this project will be well into the new year. How will 10 to 50 percent of the funding affect this?

I don't know how this government expects to tell the young, the infirm or the elderly in today's society that they don't rate decent education, they're not entitled to proper health care, and if they can't afford it, they shouldn't exist. But I feel like that's what we're being told.

I want to again thank the Liberal government for the proposed tax breaks. Their generosity is overwhelming. In appreciation of this generous gift, I'd like to give back my family's portion of these tax breaks. I want to keep or increase the badly needed services in my community, in my area, that me and my family need.

I've heard lots of talk from corporations on tax cuts and how lining pockets and profits are more important than any of our social obligations in our communities, in our homes, in our towns and in our province. I'm majorly concerned that we're putting a value and a price tag on life.

I have a question that's not very nice. I want an answer from Mr. Campbell. I hear about these 10 to 50 percent tax cuts. I'd like to know how they apply to wages, benefits, pensions, medicare of the Liberal government itself. Are they going to hurt, or is it just the working people of B.C.? Thank you for your indulgence.

B. Lekstrom (Chair): Thank you very much, Gayle. That was certainly a very heartfelt presentation.

A couple of things just prior to going to members of the committee. We are committed to maintaining the level of funding for health care and education. Those are not in the equation to be looking at the 10 to 50 percent reduction proposals that will be brought back. I agree; I don't think there's a member, whether you're in government or a member in British Columbia, who wouldn't have feelings amongst themselves. I believe everybody has a social conscience. But the reality that we're facing today — and it is a reality — is that the services we've enjoyed as a province and as the people of British Columbia, many of them very good services, unfortunately, we can't afford. That's the bottom line.

It's the part that I just want to conclude, and then I'll open it up to members. Will government be affected just like the working people? I consider myself a working person. I'm an MLA. I'm elected to represent the people, but it's a job. It's a job I love greatly, but I can tell you that the decisions we make yank at your heart many times, because they aren't popular decisions. We try to do it in balance. That's what I bring to the table, and I know that's what my colleagues bring to the table. Your presentation today is something that each and every one of us thinks about every day in trying to make the balanced decisions that have to be made. I want to thank you for your presentation.

K. Krueger: Ms. Flavelle, as the Chairman has said, I want to set your mind at ease. You appear to have misunderstood what the Premier was talking about. He made a speech to the UBCM and said that he had instructed cabinet ministers to come back with three plans each — one for a 20 percent cut in their ministries. He said very clearly that none of these affects the health care or education budgets. It's the other ministries….

G. Flavelle: I think it has a ripple effect. I think does affect the health care.

K. Krueger: If you'd just let me finish. Those are the two largest budgets of the provincial government: health care and education. Those budgets are guaranteed to be preserved in their entirety, and we intend to increase them as the economy can afford it. So there is no cut to the overall budget for health care or for education. The three plans that the cabinet ministers were asked to present are their options with regard to cutting expenditure in the other ministries. We felt a lot of empathy for the emotions you were demonstrating when you were making your presentation, and we really want to set your mind at ease that we are not cutting funding to vital spending budgets in British Columbia.

I was raised in Dawson Creek. One of my best friends was Dr. Hugh O'Brian, who loved being a doctor in Dawson Creek. If it were up to him, he would never have retired from it. He's passed on since he retired. He loved taking his riverboat up the Pine River, and he loved going grouse hunting. He loved going duck hunting. He loved everything about living in the Peace River country.

It has always seemed to me that for decades, governments have made a mistake by not actively recruiting medical student recruits from the rural areas, from the interior, and encouraging them to go back where they came from when they graduate. Instead, we have a medical school at UBC, and it's been the only one. Its selection processes tended to favour, I believe, urban recruits. By the time it's done with them, even if they weren't from the urban area, they're pretty much ur-

banized; they've been there so long and often married a partner from urban areas.

Our government has committed to a number of things to try to improve that situation, including forgiveness of student loans to health care professionals who go to where they're needed in British Columbia to work once they graduate and increasing the number of spaces in medical school.

Do you and the people that you liaise with in your life have any recommendations for how we could improve on that problem? Rather than British Columbia trying to recruit doctors from South Africa and other places around the world where they're sorely needed — and we'll probably continue doing that for a while — how can we deal with this issue of encouraging our young people? Yes, we know you have to go to get educated, but come back home and spend your careers here.

K. Krueger: Well, if you would think about it. We have a deadline for this report, but government is looking for those answers all the time. There must be ways that we can encourage our own young people to return to where they came from and enjoy the lifestyle they loved while they were growing up. It's something that I'd really like to hear from people on.

J. MacPhail: Mr. Chair, I don't think it's our job to argue with the witnesses or to convince the witnesses that there's a certain goal here, which is to say we can't afford certain services. We didn't argue with previous witnesses who suggested that we should cut taxes further.

I would also just suggest that if the witnesses bring forward information that they've received publicly, it's also not our job to argue with the kind of information they're bringing to us about what the Premier said or didn't say.

Ms. Flavelle, in your presentation…. Actually, you come here with a great deal of experience. There's one particular area that I'd like to ask about your experience, which is the aging population of children at home with developmental disabilities. Does your association keep track of that aging population?

G. Flavelle: My society as a whole — no, it doesn't. But we have contact with the ministry. We see the individuals almost daily in the community.

G. Flavelle: No. We have an adult mandate, so adults over 19 are who we see. Most of the population that I'm familiar with is already well into their thirties and forties and who have elderly parents at home. We do a lot of respite care, and we provide services and beds. When the parents of these aging adults are hospitalized for care, there's no other agency in our community that does that. So we know it's a growing problem.

J. MacPhail: What will happen to the adults with developmental disabilities when the parents die?

G. Flavelle: Well, this is the concern. There is no revenue to open more homes to accommodate some of this growing population. What we're seeing now are recommendations that this clientele go into acute facilities.

B. Lekstrom (Chair): Just before I go to Tony, a quick comment. I don't believe any members of the committee are here to argue with our presenters. It's certainly our job to make sure the facts are put forward. If it is putting forward that we are not here to cut education or health care budgets, I will do my best to make sure, as the Chair of this committee, that's put forward. If that was perceived as an argument, I think we have some exciting times to come, because I'm trying to….

J. MacPhail: Mr. Chair, the point is that the witnesses may feel that no matter what your government says, they disagree with you. That's all.

B. Lekstrom (Chair): Very much, and I can tell you that you're dealing with someone who doesn't have any problem having an open mind on all the issues. I'm certainly going to make sure people are aware that we're here to listen to the views. If I hear something that I think people don't understand or that isn't understood to be the facts, I'm going to make sure that's put forward so that the people…. We're a non-partisan committee that's here to hear from British Columbians, and whatever your political belief is, as a presenter or as an individual in British Columbia, if you have a good idea, I'm going to listen to it. I want to make sure that's very clear.

I do have two other speakers, and then we are going to have to move on. I have Tony and then Lorne, and we will have to move forward.

T. Bhullar (Deputy Chair): Thank you, Ms. Flavelle. You're very articulate. I understand that you were concerned about doctors moving out of the area.

G. Flavelle: I know of two, personally, in Fort St. John that are moving out. One was effective at the end of August, and the other will be leaving in November.

T. Bhullar (Deputy Chair): You're aware that the Supreme Court of Canada has stated that we're not entitled to force doctors to stay in communities. Do you have any suggestions on how we could remedy that, since you are very articulate in bringing suggestions forward?

G. Flavelle: No. If I had a remedy for this, the problem would be solved, and I wouldn't have brought this forth to this committee. I just know how it affects me personally in my community.

T. Bhullar (Deputy Chair): So you don't have any idea of how the government can solve it, considering the Supreme Court of Canada has said that we can't force doctors to stay in a community.

G. Flavelle: It is a free country. I wouldn't suggest that you try, and I don't argue with the Supreme Court.

B. Lekstrom (Chair): Again, what we will do is take the issues that you've brought forward — just like every presenter, Gayle — and we are going to do our best to formulate those in a report to be presented to our Minister of Finance. Whether we can or can't do something, it's our job to listen. I can assure you we will do that.

G. Flavelle: I did understand totally what the Premier presented with the 10 to 50 percent cutbacks. I didn't say I trusted or believed that they would follow through with these promises. I really do not appreciate being put on the spot. I feel like I'm being ridiculed for being here, and I'm disappointed in this committee and how it is making me feel.

B. Lekstrom (Chair): I would like to apologize if it's made you feel that way. It's certainly my job as Chair to….

G. Flavelle: This is the second time you've apologized, but it hasn't stopped.

B. Lekstrom (Chair): Well, then I will stop apologizing. I will allow Lorne to ask a question.

L. Mayencourt: I just wanted to ask a little bit about your line of work. You work in a society for community living.

L. Mayencourt: We've made a commitment — and I believe it has passed Treasury Board — to add another $125 million to mental health services. I wonder how that is going to affect your job and the people you're serving in this community.

G. Flavelle: No. Mental health is different from community living. It's two different sectors, two different ministries.

J. Bray: One last question. You've raised a very important issue, which is the dual aging population of parents of adults with mental challenges but also of those individuals themselves and the lack of home care and community support. You've mentioned your own personal circumstance that you may, in fact, be facing a choice between your employment and caring for your mother in a different community. Do you see a bridge between volunteering, which is in essence what you do, and the professional service where a company comes in and provides home care where families are supported in circumstances to provide some of that care, and there's some funding to alleviate the financial burdens? Do you see that as a possible part solution to the circumstance?

J. Bray: Well, right now, in your circumstance, you drive up and you do some cleaning. You're doing some work, in essence, that home care is not providing. There's lots of situations I've heard of where, if there was a category of home care for paying family members to provide some of that care instead of nothing, or care homes or group homes or those sorts of things, where family members…. It recognizes that it's a financial burden for families. Do you see that as a possible bridge in the same way as we provide a rate for relatives to provide care for children when they're temporarily out of their homes — the same things for families? Going into a structured environment maybe isn't necessary, but the lack of any other services puts that kind of pressure on. So it's paying family members to provide care for adults with mental or physical handicaps when they can't live fully independently. Is that clear?

G. Flavelle: Yeah, it is clear, but how do you propose to do this when the family members themselves are aging?

J. Bray: There may be brothers, sisters, siblings that may say: "I can't quit my job and have my brother or sister or niece or nephew move in with me. I can't afford that. But I might be able to cut down my hours if I'm actually able to provide that care and I've got some financial support. Otherwise my sibling or whoever goes into a care home at a $500, $600 or $700 cost."

G. Flavelle: It's not an easy job looking after a child that is mentally and physically disabled — the stress alone, the hours with lack of sleep. I can't see family members being able to do this long-term. No, I can't see that as an option.

B. Lekstrom (Chair): Gayle, I'd like to thank you for coming and making your presentation. We will take your issues and put them forward in our deliberations when we put the report together.

We will move on. We're falling somewhat behind. We had a slow start this morning, and we will try and catch up. It is now the Central Interior Wood Processors Association. Mr. Gary Aven will present.

G. Aven: Welcome, Mr. Chairman and standing committee. In your exercise up here, I hope we exceed your expectations. My name is Gary Aven. I am president of the Central Interior Wood Processors Association. As well, I am president of A.J. Industries, a local value-added manufacturing business located in Dawson Creek.

There are six main value-added wood associations in B.C. The Central Interior Wood Processors Association, the CIWPA, is mandated to represent the value-added industry for the northern two-thirds of the province. While our membership employs over 1,200 individuals — it contributes in excess of $125 million to the economy — there is room for major growth. This is the largest undeveloped area of the province as far as a secondary or value-added industry is concerned. The majority of the province's available fibre is in this area, yet the dollar potential and community benefits from processing this fibre beyond the sawmill are grossly deficient.

There are a number of reasons for this underdevelopment. Access to appropriate financing, fibre, labour and proximity to customer base are just a few. A higher operating challenge due to our northern climate is another. With all that in mind, we offer some initiatives for consideration and implementation.

Finance. Today's commercial financial institutions will not invest in the forest sector. We feel that the current program that FRBC established with BCDC and CFDC should not only be maintained but be enhanced. While bailouts may not be appropriate, financial assistance based on a solid business plan should receive serious considerations at all stages of the business cycle. Local government, community and business leaders could make this decision. These programs should be considered investments. We have never thought of them as subsidies but, rather, as business development initiatives.

Tax considerations like the removal of a sales tax on production equipment could be enhanced. This initiative should include the removal of the 7 percent sales tax provincewide. If necessary, these finances — and I'm going to get into trouble for this with somebody — could be replaced by the oil and gas industry, as is similar to Alberta. Although we don't know the true figures at this time, we feel the forest sector contributes more than its share to the provincial revenues through stumpage fees.

Municipalities should be granted more ability to provide incentives through tax considerations for employment returns. As well, municipalities should be able to invest capital in a public-private business arrangement with freedom of decision inherent. Perhaps a municipal investment holding company could be the legal delivery vehicle.

Last but not least, investments in regional value-added associations must be maintained. We feel we have historically delivered an acceptable return on investment. Information dissemination not only to our membership but also to the provincial government is of immeasurable value. With a properly functioning industry-government partnership, the value-added industry and the province as a whole can do nothing but succeed.

Operating challenges. The CIWPA membership and businesses in general have a much higher operating challenge. This is due, in part, to our northern location. Energy costs have historically been higher due to the colder weather and longer winter season. We must consume more energy and consume it sooner, much sooner, than our counterparts in southern B.C. and the U.S.A. Along with higher transportation costs due to the remoteness of our location from world markets, we are decidedly disadvantaged. We suggest that government look at all utility providers to see where this playing field can be levelled.

Economical highway transportation is dependent on all routes being maintained in very good condition to minimize costly travel time and equipment repairs. As a suggestion, the removal of the sales tax on new and used mobile equipment would help offset this expense.

Our ability to source a trained workforce is another challenge. We feel there is a large unskilled workforce available. However, the expense of bringing them up to standard is prohibitive. Some sort of training initiative needs to be developed, and I'd suggest this initiative be developed with input from the value-added sector.

In closing, the provincial government must maintain a pro-business attitude. We have spent a long time getting this poor business climate with the previous government. We must get out of it as soon as possible. Business initiatives and tax incentives will be the vehicle for recovery.

B. Lekstrom (Chair): Thank you very much, Gary. I will look to members of the committee for questions they may have. I think it's important to note that when you speak on value-added and the challenges it faces — and I believe it has been said many times by many people — it takes some investment to get a return on the dollar. That's what I'm hearing from your presentation, and the information you have put forward will be taken into consideration during our development.

G. Aven: The lack of financial availability to the forest sector, particularly the value-added sector in the north, is really extreme. I don't understand a good portion of it. Many of the people — I have consultants in that business that I deal with — are frustrated with the way the banks have traditionally bailed on everybody.

Private capital in the forest industry right now, which is the one that should be invested in, would be invested in the south, where the population and the infrastructure are in place. They're not interested in coming north with all the uncertainties, the SLA, the pine beetle and all those other things that we're dealing with at this time. Those are very important issues for developing this industry. It's the driving force for the future for B.C.

R. Sultan: Would the Slocan OSB facility be encompassed within your definition of value-added?

G. Aven: We have struggled with that definition, and I am not prepared at this moment to define exactly what that would entail. We also have been asked by B.C. Assessment. They're doing a review, and they're asking the same question: for us to define value-added. We're still in that process. We're having a meeting on it. I believe it's on October 9. Our association will try to come up with that answer.

B. Lekstrom (Chair): I take it that perhaps your members, the people you represent, are smaller organizations.

G. Aven: We're not the primaries. We would be independent remanners, independent from the primary breakdown. Those are LPs.

R. Sultan: Could you give us one or two examples of enterprises locally that would fall within your domain?

G. Aven: They remanufacture wood. They produce fingerjoint studs. They provide a product…. We don't have an awful lot of high-volume, high-end producers making furniture in great volume. We have a large number of smaller individuals, one- or two-man shows, making very good furniture.

Along that line, I'd also like to mention and make sure that everybody's aware of Expo 2000 in Prince George. We have been invited, and there's going to be a value-added sector tied to that now. All the manufacturers are hoping to attract a very large variety of manufactured display product. We're trying to entice B.C. Wood Specialties Group to do a reverse buying mission from overseas to qualified buyers and bring them to Prince George to meet our producers in our registry. We expect this to be a great show, the hugest of success.

R. Sultan: In terms of fibre supply, can I ask a supplementary question? Do you think there are unexploited reserves of fibre supply potentially available in this area?

G. Aven: It depends on what our long-term goals are. If we're going to break them down into commodity products, if that's our sole focus, then it's all committed. Everything's there. If we can divert some of that to the value-added, we don't require nearly as much of the fibre, but the problem we have at this moment is that our tenure system doesn't suit for this to develop.

We're also working with the Ministry of Forests and Al Gorley on this, trying to come up with some solutions on this line.

G. Aven: We need the infrastructure and the facilities to dry the material properly. Sawmills, which are where our main focus is and where we get most of the material from, will not dry it or do not have the capability to custom-dry it to furniture specs. The moisture content and quality of the drying exceeds normal procedures.

R. Sultan: What I was particularly curious about was your reference to the tenure system. Did you have some thoughts, some comments, on that?

G. Aven: Not that I'm comfortable with yet, at the moment. We're still in the process of working with Al Gorley. We have stated that section 21 is very important to the value-added. It is something that enables secondary businesses to become established if they can bid-propose for a timber sale. There's an equity value involved with that proposal. There are commitments that they make for that privilege, and those investments can be used to start or maintain existing businesses — provided they are bid and there are costs involved with them. But they are a way to help assist.

So section 21 is very important, and that is limited in supply. There are the category 1 and category 2, and the category 2 and category 3 guys are the ones that require the bid proposals. The category 1 guys have most of the available cut at this time. There are some changes and some work that's got to be done on that, definitely, to improve it for the benefit of the whole province, not just our sector.

I. Chong: Thank you, Mr. Aven, for your very thoughtful and succinct presentation. As you know, in our prebudget consultations we are looking to British Columbians for ideas and suggestions that would help this government in establishing our priorities and determining those programs and services that should be restructured, expanded or terminated. I see that you have given us some ideas about things that should be enhanced, but I wonder if you've given any thought to those within government that could be terminated or restructured within the context of the industry you represent.

G. Aven: I cannot think of any at the moment that are really a detriment to the industry or around it. FRBC is being reviewed, which is a good thing. I think there should be some way to have this relation with government still be established through some sort of…. I don't know how it would be described in the future. There are some programs that we in our particular sector disagreed with. We spent too much money on research on things that didn't matter to the sector. A large portion of FRBC's budget was put in that direction. I thought the business unit of FRBC was very underfunded for what they were trying to achieve — on marketing and training initiatives that we undertook. The training initiatives are being redescribed as we speak, through B.C. Wood Specialties Group. As well, the CIWPA put a presentation forward to Christie Brown in describing a better one-stop shop, something like an association where all this information can be disseminated more readily with programs taken and administered at a local level rather than from the Burnaby office and Victoria.

I. Chong: Thank you. Just in closing, should you ever think of those programs that need termination, elimination or expansion, that would help.

G. Aven: I appreciate that opportunity. Fortunately, Ken Pendergast — he's our CEO — is going to make a presentation in Prince George this afternoon as well. He's seen mine. I didn't want to duplicate an awful lot of this. He will be addressing part of these questions you're asking in Prince George as well.

I. Chong: I was just going to say that we have a waste-buster website that you can access any time of the year and not just wait until we come out to your community, if ever you have those ideas.

G. Aven: I wanted to take the time to make a personal presentation and then submit it, not one that reflects the CIWPA but that reflects my own personal view.

B. Lekstrom (Chair): Just to move this forward, we do have two members of the committee wishing to ask questions. I would kindly ask that they consider the time issue.

B. Kerr: Very quickly, I just want to get into fibre supply again. Are you telling us that you're having trouble getting fibre supply? If we can change section 21 to get you fibre supply, you'd be able to put more emphasis on value-added as opposed to dimensional?

G. Aven: The fibre is there. The way it's distributed and the timber right now in the primary sector…. The value-added, in my business in particular and most of our membership, we do not break down. We're not capable of breaking down a log into lumber or into products. That's not what we specialize in. The sawmills specialize in that. Getting that material from the sawmills afterwards is a problem. Section 21 was originally designed for…. If you obtained a timber sale, the sawmills would break the doors down trying to buy it from you, and they would promise you all kinds of wood in exchange. That is not the reality. We do not engage in an agreement like that.

We use them for bargaining tools and whatever value…. They are essential to helping obtain fibre from sawmills. But the biggest thing is getting the right fibre from the sawmill that suits the need of the individual operation. That is very difficult.

B. Kerr: Okay, I'll contact you, because we have an idea. In my riding they're working this out, and it's working out quite well.

B. Lekstrom (Chair): Gary, I would like to thank you for taking the time this morning to come and put your presentation forward. I think the value-added sector is certainly of vital importance to all British Columbians, and I appreciate you taking the time and effort.

G. Aven: We appreciate the change in government, and we look forward to working with you in the future.

B. Lekstrom (Chair): Okay, we will move on. This morning our next presenter is the district of Tumbler Ridge. With us we have His Worship Mayor Clay Iles as well as Fred Banham, the administrator for Tumbler Ridge. Good morning, gentlemen.

C. Iles: I'd like to say good morning to the Select Standing Committee on Finance. I'd also like to welcome you to the Peace country, where I'm proud to live. Welcome home, Blair.

We're here as the district of Tumbler Ridge, and we're pleased to make this presentation. We're also very sure that we want to be a part of what's going on in this province. We realize that you have some really tough decisions to make in this financial section of government. However, what we want to do is bring to you people what it is we need in our area to stay alive. We will work with government in every way we can to try and bring up some solutions and live within the guidelines these people are going to be laying out.

I've got Fred with me this morning, and I'll refer to Fred very shortly. Before I start, I want to tell you that we're a resource-based community. To this point we've been a mining town. We've gone through a tremendous period in time because of the mining industry. I don't have to tell Blair what that process has been. When he was mayor of this town, he was very important to what we got done.

Three things we had to do were set out by government at that point in time. After we had a task force review, we had to get control of our housing, we had to get control of our finance, and we had to diversify. We have a very good story to tell about our housing, and we're down to something like 20 houses left out of 700-and-some houses. It's a fantastic story when you stop and think about it. That's in just over a year.

We were able to work with the past government and come up with a solution on what we could do with our financing. Joy, I don't mind telling you that we had a good experience with your government in the assistance of that.

C. Iles: I'd like to say that our finances are where we want them to be. We're debt-free. Our housing story was a good story. We're in the process now of taking the third step, which is diversification. Once again, Joy, I'll say this, on behalf of the government that you represented. We needed our roads paved, and you started off the program with 35 miles on Highway 29 last year. Blair, that was answered by your government. That road has been increased by another 35 kilometres this year in the paving program. It's a vital link to our town. Next year we hope to have it completed with another 35 kilometres of road to be built.

Our biggest concern, being a resource-based town, is that we have to keep our transfer areas in good shape. Our roads have to be in good condition. We're not only in mining. We're also in forestry, and we're also in the gas sector. Gas in our area has now taken off, and we have a high percentage of traffic in there.

The key link to our town is our railroad, and we have a 70-some kilometre spur line. That's what it's called. It services our town, and you'll see that in our presentation that we'll leave with you, mapping out where that goes. Without that rail line we'd be absolutely dead in the water. What I'm trying to bring to you people is that when you're looking at your finances and what it is you have to do, can you consider what the B.C. Rail line means to this part of the world? It is not only important to Tumbler Ridge; it's important to the entire community of the northeast slope.

We have no idea where mining is going to go, down the road. We're hoping that we'll always be a mining town. We're trying very desperately to get into the gas sector of things. We're trying to be a player in that area. In doing that, we have to have our roads to where these people are interested in doing business with us. It is beneficial not only to our community, but it's very beneficial to this province — the amount of revenue that's going to come from the resources in this part of the world in the next number of years. We just know that's going to happen. The key for us is that we have our roads in good condition and we keep that rail line.

We've already tried to partner in some way with big business, and we've done it in this way. We have tried to get an arrangement with the pipeline company. They are going to lay 130 to 140 kilometres of pipe this coming year. Rather than hauling that over the highways and pounding hell again out of our roads, which we're just now getting into shape, we're suggesting that they bring it in by rail. That utilizes the railroad for more than just coal. That's all we've ever hauled on it, and it's wrong. It should be utilized more than it is. In doing that, we can bring in longer pipe, which reduces the amount of welding you have to do on that pipeline. That's a safety factor as well. The fewer joints you've got, the better you're going to be. We're suggesting to the railroad that they bring that pipe in. That's between big business, whether or not they want to do that.

Those are the initiatives we're taking as a community to try and be a player in what's going on. It's easy enough to complain, but I believe that when you do that, you should also bring a solution with you. We've tried to do that.

The other area that we're talking about being a player in is the green area — that is, power-generating through the windmill process. Have you looked, at this point in time, at whether it's a good spot to be setting this up? Methane gas is another area that we're talking about, and that's new to our part of the province. We want to be a player in that. All of these reasons for keeping our roads and our railroad are so important to us.

I'm going to ask Fred if he will speak a little bit on small community grants — that's his field of expertise — and anything else that he may think I have missed, which probably is a lot. Fred, would you go ahead, please.

F. Banham: Certainly. Also important to communities under 5,000 is the current unconditional small communities protection grant. It's just under $300,000 in value to a small community. It isn't a huge amount

of money when you look at one grant, but the kind of services that it allows us to continue to provide in a small community…. That can be the snow-clearing equipment and the entire operating budget for snow-clearing for an entire year. It makes a big difference in the ability to clear the snow, provide water and sewer and things like that. We'd like the government to look at that and consider in its finance review the spinoffs that allow us to maintain those.

The next area we'd like to look at is community policing for under 5,000. I hope it's just a vicious rumour, but rumour has it that it is up for consideration and that communities will be required to pay the full shot for policing. I think our community is prepared to accept that if required, but if it has to accept it, it also needs the mandate or the ability to raise the resources in order to pay for that service. Policing in a community the size of Tumbler Ridge could probably be half the entire operating budget, if not more. It's a significant whack to have to take on but very critical to the survival and maintenance of just the community itself.

Those two issues alone I'd like the budget committee to consider over the next couple of years while looking at the budget process.

C. Iles: If there's something you want to ask us, Blair, we've pretty much wrapped up what we want to do here.

B. Lekstrom (Chair): Certainly. What I'll do is see if there are any questions from members of the committee to either Fred or Clay. I'll start with Joy and then Ralph.

J. MacPhail: Thank you very much. It's interesting to note the house sales. Is there any change in the demographics or the nature of who lives there now? Do they live there all year round?

C. Iles: That's a good question. What we've done — and this is going to be just a rough number…. Probably what we've got is that 60 percent is occupied; 20 percent would be speculation. And probably another 20 percent is recreational, simply because we live in a great area for skidooing in the wintertime. When the houses were sold, they were sold at those prices that you could afford to call it your cabin if you wanted.

As far as the people in the town, we don't have as many, of course, of those $50,000-, $60,000-, $70,000-a-year wage earners. We have got people who have moved in who are on a fixed income or have retired and have a managed income, which says that they can spend X amount of dollars a year. That has changed a whole lot of things in our town. That isn't all negative. What they have done is come to our community with a sense of "I want to get involved."

You can appreciate that if you had a piece of property, for example, in Grande Prairie, Alberta, that was worth $200,000 and you sold it and were able to relocate in our town for $25,000 to $35,000 or $40,000, you'd have a nest-egg jump in an awful hurry. For some of these people, it's almost an untouched amount of money at this point in time. Some of these people have got that extra dollar. They would like to get into tourism or something else. They want to be part of the community. We're still in such a transition period that it isn't clear yet where we're even going as a town. But we do know that there's room for them to be a player.

So that's how the whole thing has changed. A lot of our people have moved in. Some of them have families. Our school system is still fine. But they're working in satellite jobs such as the diamond fields up in Yellowknife or the gold fields in Kemess, and they commute back and forth from our town. It has changed.

J. MacPhail: Just one follow-up question. Given that there may be opportunities other than resource extraction for the community, like a resort community almost four seasons, is there any consideration for making the spur from Anzac to Tumbler Ridge something other than just cargo — perhaps passenger, or is that just not feasible?

C. Iles: No. What you're asking is bang-on, Joy. We've had about five public meetings that council has had with the community, trying to get a feel for where we want to go and what we want to be. A number of times that rail link has been talked about. We don't have a good ski area right in Tumbler Ridge, but we certainly have one a short distance out on the rail line. Could we add a car that would haul people back and forth and turn that into a tourism area? Yes.

There are so many things we have to do now that we're forced into doing, which we've never had to do in the past because we had enough money. We all had jobs, and things were good. Now we're forced into a situation where we have to look at things like you're talking about. Once again that brings us back to our roads and our infrastructure. It's paramount to us that these things be done. That's a very good question, Joy.

R. Sultan: Mayor Iles, I'd like to commend the citizens of Tumbler Ridge for taking what seemed to be a total-collapse situation and turning it into a success story. It's a credit to your initiative. I contrast it with the very sad tale of the community of Cassiar, which was dismembered and essentially shipped down the road in pieces — a great and unnecessary tragedy, in contrast.

I have a question. I'm puzzled. I appreciate that the mining industry is complex and that there are many aspects to it. But here we have in your community mines mothballed and shut down at the same time that other mining companies are starting up in the coal sector. What's going on?

C. Iles: We have a new player in the game, and that's Western Canada Coal. They're looking to develop a mine right between the two mines we've got.

C. Iles: We can speculate on a lot of things as to why that can happen, but it's only speculation. I don't have a good answer for you, Ralph.

F. Banham: If I could, there is just one to add to it. The current coalmines, the Quintette mine and the Bullmoose mine, sell specifically to a seven-company Japanese consortium. That's it. The third coalmine proposed is selling on the open market. So those guys are going out and selling coal a boatload here or a boatload there. It's a little different than the other guys that are just shipping it. If the Japanese don't want it, then it doesn't get shipped. It's a different way to market it.

C. Iles: I'd like to add one more thing to what you've said, Ralph. You're saying that we've done a good job here. We take some pride in what we've done, yes. But I can tell you that it wasn't done alone. It wasn't done by mayor and council and the administrator of Tumbler Ridge. It was done through the regional district. We had a lot of help from every member in that regional district, including Blair when he was the mayor of this town.

We also had a lot of help from the people who were sitting in parliament at the time and the people that they directed. It took a joint effort, and I believe that same kind of thinking and effort have to be now, as much as ever — with the new government and new direction and things you're trying to do. We have to work in that way. Communities have to be involved in what they're doing. I'm going to go back to it again. The infrastructure for us is key; it's paramount.

B. Lekstrom (Chair): Your Worship, Fred, I would like to thank you for taking the time this morning and making your presentation. We will take your information into consideration in the development of our report. Again, thank you very much.

C. Iles: Thank you, Blair. One thing with your panel being here today, if you're talking about saving dollars, is that you've probably saved a lot just in the fact that we as communities don't have to go to Victoria to carry our case down to you. You're here to listen to it this morning. We thank you very much for doing that, and thanks for having us here.

B. Lekstrom (Chair): Moving along in our agenda, our next presenters are the Northern Lights College, and I believe we have some presenters here. I welcome you this morning. With us we have Ellen Corea, Greg Larsen and John Birnie. I'd like to welcome you to our committee this morning and look forward to hearing your presentation.

G. Larsen: Thanks very much, and we welcome the opportunity to be here. Our board Chair, Bernice Greengrass, and our president, Jim Kassen, both apologize. They're both unavailable, so you get stuck with us. I'm going to basically read a prepared presentation here. What we are presenting today is supplementary to a September 12 response we submitted to the Deputy Minister of Advanced Education in response to the core services review.

Northern Lights College was created in 1975 under the College and Institute Act, which outlines the objects of the college to provide — and this is the legislation — comprehensive courses of study at the first- and second-year levels of a baccalaureate degree program, post-secondary education or training, adult basic education and continuing education. Northern Lights College works within this mandate within our 350,000-square-kilometre region, which comprises the four northern school districts: Peace River North, Peace River South, Fort Nelson and Stikine. We basically serve eight communities where we have permanent or rented facilities, including Dawson Creek, Fort St. John, Chetwynd, Tumbler Ridge, Fort Nelson, Dease Lake and Atlin.

It's in the context of the mandate under the act and our region upon which the rest of this submission is based. We hope to suggest directions that are conducive to the interests of, firstly, our primary customers, who are the students of those communities and, secondly, the people of B.C.

In the last year over 12,000 people — different individuals in a region with a total population of approximately 60,000 — enrolled in one or more of our college course offerings. Our geography, our climate and our small, diverse population base all challenge the college's ability to provide access to those 12,000 students. The college plays a significant and important role in the economic, social and cultural development in each of our communities. Finding a balance in responding to the competing interests and still working within our educational and fiscal mandates of each of our eight communities is a major challenge for us.

Similarly, Northern Lights must compete with 21 other colleges and institutes plus the public universities under the mandate of the Ministry of Advanced Education. They in turn, as you're well aware, compete with dozens of other provincial ministries and agencies within the government's priorities and fiscal mandates.

We recognize that we're a small player within this bigger picture, but we do take solace in Finance minister Collins's response to committee member James's question in the September 14 committee meeting as to whether public input would be considered in the final preparation. His response was: "Yes, rest assured that we will be looking at everything the public presents to you."

Again, because we're a small player, we do take solace in the fact that hopefully our comments will be seriously considered. We recognize the enormous task that government and its agencies have in addressing the issues brought forward by the fiscal review panel

The challenges that we collectively face were years in the making, and they may be years in changing. However, we hope we can offer you some further insight into swinging the pendulum back in the direction of the balance that's being sought by government.

At Northern Lights College we're dependent upon a core foundation of adult basic education in each of our communities. Fundamental skills that are gained within this program provide the foundation for other programs and future gainful employment for those students. As the average age of our students is 28, it's not conducive to their success to offer these programs in a high school setting, but more so in a setting with other adult learners.

The current funding formula doesn't reflect regional, demographic or learning needs. It's based on an urban full-time student model that doesn't reflect the fact that rural classes may be smaller or that part-time, non-credit, non-base or flexible delivery models are required in order to meet the needs of our students as they try to balance their financial, family and work commitments with their educational goals.

A number of reports and studies were conducted for the Ministry of Advanced Education over the last few years, including the Small Colleges Report, Critical Issues in Funding Review and Assessment Team Report. Each recommended a change to the current funding model, which is over 20 years old and reflects a different era in education. Although there was a system effort made to revamp the formula, it was never completed and the old ways continue. If we are truly to move to a new era, the funding formula must be changed to not only allow for innovative program delivery that is responsive to the needs of students but also allow institutions to become more flexible in their partnering of programs and thereby increase student access to a wider variety of program choices.

One of the biggest financial challenges we've had to face is the cost of implementing common collective agreements. Over the past few years the college system has moved from a series of local collective agreements negotiated between each individual college and its unionized workforce. In our particular case we had separate agreements with our support staff and our faculty. We now have four agreements to administer, two local and two common. Although government funded the implementation costs of the two common agreements, it has cost everyone more, as common agreements contain what are loosely known as superior provision clauses.

Balances between wages and benefits that were achieved over years of local bargaining have been lost as the system levels up. As a specific example, Northern Lights wages were traditionally lower than those at other colleges; however, our employer-paid benefits for health and welfare were much better. As a result of common bargaining, our wages came up to a common level, and our superior benefits were retained. The benefits then became the goal of the system in the next round of negotiations. As a consequence, there have been significant long-term costs for the province, as colleges have had significant costs added to wages and/or benefits.

Further, where local agreements attempted to establish equitable levels of benefit coverage for all employees — faculty, support staff and excluded staff — there are now different levels for each group. In addition, common agreements don't recognize regional or institutional differences, and the cost of addressing these have put additional pressures on Northern Lights College.

Common bargaining has not contained or limited system costs, and it has certainly led to significant cost increases at Northern Lights. We estimate that the increased cost of levelling up to the common grid, excluding the negotiated increases, to be in excess of $800,000 annually at Northern Lights alone. This includes faculty, support and excluded staff. As I said, we're a small player in the bigger picture of things within the college system. Larger institutions would have proportionately larger increased cost.

The costs of administrative time and staff release time for bargaining are also additional drivers. Whereas local bargaining in the past was generally concluded in seven to ten days, the provincial common bargaining in 2001 for faculty took 22 days. Local bargaining, which is primarily to amalgamate the agreements, took an additional eight days and is still not concluded.

Another area of concern for us is the additional cost associated with the programs or iterations of programs that were offloaded from the Ministry of Human Resources. Institutional-based training — IBT — expanded capacity, B.C. Benefits program and training assistance benefits have significant administrative costs associated with implementation and the tracking and monitoring of EI and social assistance recipients. Beyond the additional reporting requirements and beyond the mandate of the college, these programs have additional costs for what to us is unfounded severance liabilities that could result from the regularization language of the common agreements.

The Budget 2002 consultation paper references the development of a three-year financial plan. We commend this approach; it's been recommended from within the college system for a number of years. But we'd ask, if it is going to be the approach, that within the predictable funding envelope there be allowances for the ability to adjust to market dynamics.

Northern Lights College has responded to other specifics in our core services review submission, and those will be addressed in another forum. You'll likely receive hundreds more submissions similar to ours in the deliberations of the committee over the next while. A common theme that will likely arise is related to reporting procedures. Productivity has been affected, as there appears to be more time spent ensuring that things are done right rather than doing the right thing. There's a definite need within government for safeguards and for checks and balances. However, there's such a preoccupation with processes, committees, sub-

committees, review panels, boards and consultants that the ability of management to adapt to the educational challenges has been eroded.

On behalf of the board and the administration of Northern Lights College, we thank you for the opportunity to appear before you today. We hope our comments have been beneficial and will be constructive in your deliberations as you prepare your report. Please be assured that we will do our utmost to support the findings and work within the new budget processes that the government will introduce.

I. Chong: Thank you for your presentation, Greg. I just noted two areas in your presentation that I'd like clarification on perhaps. The first is the bottom of page 3, where you talked about the additional costs associated with the programs that were offloaded from the Ministry of Human Resources. Have you calculated what kinds of dollars we're talking about? As you're a small player, then we can extrapolate that to others.

G. Larsen: I don't have a specific figure for you, but we did have to add staff in each of the four major campuses — Dawson Creek, Fort St. John, Chetwynd and Fort Nelson — to deal with the increased financial aid, to deal with the reporting procedures. Right there we're probably looking at $120,000 to $130,000 a year as a minimum for us. There are major extensions on those, as well, in terms of the demand upon counsellors, advising services and the like, dealing with all of these. They were problems that were offloaded from MHR.

I. Chong: The second area was on the last page, the second-last paragraph. You talk about the pre-occupational processes and that the ability of management to adapt to the educational challenge has been eroded. Did you present a summary of that when you went through core review?

G. Larsen: Within our core report, the submission to the deputy minister, yes.

H. Bloy: Thank you very much for your report. When you talk about all the reports that have been done to change the funding, your programming would also be different here from an urban college. Are you doing more job-specific programming for the businesses in this area?

G. Larsen: If we were to look at a breakdown of our enrolment, yes, they would differ from a lower mainland urban college or even one of the Island ones. About 25 percent of our full-time-equivalent students are in adult basic education programs or developmental, fundamental programs. We run a provincial program in the form of aircraft maintenance engineering. We run the gamut of programs from applied business technology to welding to university transfer — all within the mandate that we have to work with.

G. Larsen: Yes, we are. Early childhood education is the forerunner for the province in terms of distance delivery.

H. Bloy: Okay. I appreciate your presentation. One size doesn't fit all, and every area has to be unique.

B. Lekstrom (Chair): Ralph, with the indulgence of the committee I would like to possibly move on and get us back on track. We're a half hour behind now, and I know the time frames are tight in order for this committee to attend Prince George later this evening. So if it's quick, Ralph, I would entertain it.

Ellen, Greg and John, I would like to thank you for coming forward this morning and making your presentation. I can assure you that your presentation has been listened to and, like the others, will be valued in our consideration and development of our report.

B. Lekstrom (Chair): Our next presenter this morning is Dennis Mracek. Good morning, Dennis, and welcome.

D. Mracek: Good morning, Blair. I'd like to welcome you MLAs to Dawson Creek on this fine day.

I'll just give you a little bit of a background on who I am. I'm Dennis Mracek. I was born and raised in this area, lived here all my life. My brother works the family farm and also has to work at a second job. My mother is retired at 82 years old. I was in a car accident in 1975, got a broken back and have been in a wheelchair since. That's 26 years. I've worked at many part-time jobs in government offices, legal services, different boards of appeal, etc., to help out with making extra money coming in. But in the last many years, things seemed to have gotten worse, and now I'm basically strictly on a $500 disability CPP pension. In the past 20 years I have volunteered my time in numerous groups in Dawson Creek and in the province. I'm presently on the board of the B.C. Paraplegic Association. That's in Vancouver. I'm vice-president of the Citizens on Patrol in Dawson Creek and president of the Dawson Creek Lions Club, just to mention a few.

To start with, I'd like to thank Blair for building a new office and getting it nicely opened up for the MLA here. It looks great and everything, but he forgot one thing. There's a six-inch step right in front of this main door. After the thousands of dollars we put in, maybe we could spend another hundred or two to make it completely accessible.

B. Lekstrom (Chair): Dennis, I've been talking to my contractor time and time again. It's certainly one of

the first things, and knowing that it would come up…. It's there. My landlord, I would say, dropped the ball a bit, but it will be looked after. It's not something that was forgotten.

D. Mracek: Thank you. I have about seven different topics here, all the way from Pharmacare to B.C. gaming, so we can go either way. Just like Blair did — got in and answered the questions — or I'll continue on and go to it. Whatever.

B. Lekstrom (Chair): I think we'll just let you go through it, and then we'll ask questions. We just had to clear up that one issue.

D. Mracek: Well, first on home support. I've been with them 20 years getting help cleaning and meal preps, etc., in the home. But over the past 20 years it's dwindled from what I was getting to start with down to about 50 percent now. I understand there's more funding cuts again. Previous to this, my mother had to sell her house last winter because of the high gas costs, her trying to live alone and not getting any care at all. So I'm just wondering where and how…. I mean, we try to keep people at home and out of the hospitals. The best service, of course, is to keep them at home, but we do have to have people come in to help out and keep up to date on keeping places clean — washrooms, etc.

Another thing I see, just reading in the Province on the weekend, is a freeze in the budget on medicare and schools and teaching, etc. A freeze is actually a cutback.

I'll go back to the Pharmacare deductible. I understand that now — nobody knows for sure — it's definitely going to affect seniors and people on disability. A local druggist informed me that he's not exactly sure which way they're going to go. They're talking about needs or means tests, which we've all been through before when you have home support, etc., coming to you. I don't know how many more needs or means tests they need, but in some cases what this will mean is that my mother and I and other senior citizens will have to do without some of the Pharmacare prescriptions we need.

Going back into hospitals, I talked to my doctor and some of the nursing people in emergency. There seems to be great concern that we're going to go back to user fees. We've had user fees before. It was a big confusion. Some of them would run you an account, and some had to turn people away because they didn't have the $20 or $35 or $40 or $50 or whatever it's going to be. It's just something that should be looked at. There's got to be a better way of doing it.

Amalgamating the Dawson Creek Hospital all the way to Fort Nelson with every other hospital service in this north region and giving them one lump sum of money is already giving us a cutback. I've talked to one of the accountants in the local hospital. He doesn't even know if he's going to have a job any longer, let alone worrying about…. He tells me that the government of today hasn't even taken into consideration the nurses' raises that have been okayed and done. So that really makes me worried.

I'll just continue on here. There is a disabled gas tax rebate. There has been for 20 years or more. Right now I can't seem to get an answer from anybody if we're still going to get a rebate and how much we're going to get per litre or if this program is going to be done away with, with the cuts of the different ministries.

I'll leave that one and go now to ICBC. That's a wide and big subject in itself. We hear about cuts of 800 jobs — that type of thing. My main concern is that I am on an ICBC claim that hasn't been…. I have an open claim for rehabilitation and extra chairs and whatever I need. I have a rehab worker in Vancouver who also looks after it if I need to see specialists, doctors, etc. — need airplane fares. It used to be that I could pick up the phone and probably have them okayed in a day. Now you get an answering machine, and you've got to wait. You don't know if they're even going to get back to you. I didn't think there were any cutbacks yet, but I know there's a lot of worried people in that industry. That's one part of it that I'm worried about.

I volunteer for Citizens on Patrol, like I said before. Last week I was down at the B.C. Crime Prevention meeting in Surrey, which is for the whole province — volunteers and all policing services. That's about a three-day seminar. It's sponsored 50 percent by ICBC. I'd like to know how ICBC is going to be able to…. If we're going to break it down with every other new company coming back into town and starting up, where's the funding going to happen to continue this program next year? They're already hoping to be able to have another conference. These are educational conferences — volunteers. We need that kind of thing, especially in the north. Down in the lower mainland people call a meeting in Surrey or New Westminster or wherever and get a fair coverage, but we have to go down, and it has to be a special time and extra cost, etc. Just out of interest, 11 people from Dawson Creek attended this year.

It just so happened that while we were down there, we also heard that 30 to 40 percent of RCMP provincial expenditures are going to be cut — a lot of extra services. That would make me think that if you have a community policing officer up here, you could quite easily have to put him back on the street. Talking to a few of the members down there and volunteers…. Volunteer service will not work without a leader. If that leader, being the community policing officer, has to go back and has to quit, basically your volunteers are going to fall apart.

B. Lekstrom (Chair): Dennis, due to time frames, just to let you know, we have a couple of moments more.

D. Mracek: B.C. Gaming — 80 jobs being cut, closing all the offices. I guess this will get rid of all the bingo scandals, and we won't have any more. I've been in bingo halls before they were commercial halls and

everything. I can assure you that we need…. I'm not saying that we need all the people we have, but we sure can't cut the whole thing out and leave it to one man. I've been told that B.C. Lottery's local guy up here is supposed to cover the whole area for the north, to look after it and make sure everything is done right.

Like Blair says, I could go on for a few more things, but I'll just leave it at that. I'd like to thank you for the time. Has anybody got any comments or questions?

B. Lekstrom (Chair): Thanks very much, Dennis. Again, going back to a statement I made earlier, I'll touch on just a couple of issues. The RCMP budget that you touched on is very important. I know you've put many years of work into trying to make our community a safer place. The budget has not been cut. The direction is to work within the existing budget for the RCMP. That is a struggle, with the increases; there's no doubt there. I just want to touch on that briefly. The challenges are many, as you've touched on.

With that, I would look to members of the committee if there are any questions for Dennis at this time.

K. Krueger: I was sorry to hear of your tough financial circumstances at the outset. I wonder whether your injury was the result of another person's negligence, or was it a single-vehicle accident? How were you hurt?

D. Mracek: Yes, I was in a car accident. A guy rolled a car, and I got thrown out of it.

K. Krueger: The tort system is supposed to be designed so that people like you, who are injured through someone else's negligence, receive a settlement over and above the no-fault benefits that you mentioned. They are still available to you. That is supposed to include an allowance for the loss of future earnings and ideally, if invested, to provide you with a decent income to make up for the opportunities you lost due to your injury. Was there such an award for you, or was there a problem with coverage or something like that?

D. Mracek: Well, in 1975 the awards were very poor, and they only went on like that through what you had for coverage. By the time you got what coverage you had carried, they basically went from $100,000 up. Settlements were very poor, and once you get through with your lawyer's fees, etc…. I took a lump sum, which was probably a mistake. It looked good at the time. That's where I'm at right now.

K. Krueger: That's what I was going to ask you. There is a body of opinion that rather than lump sums, the awards ought to be what are called structured settlements where a person has an income for life, and it increases. You can structure it in many different ways, but it can increase with inflation and so on. By your life experience, would you say that's a better way to go than to have lump sum awards?

D. Mracek: Absolutely. I am quite familiar with the structure they're using now, and that's definitely a better way to go.

B. Lekstrom (Chair): Dennis, thank you very much for coming and making your presentation.

D. Mracek: I'd like to thank the committee again, and hopefully we'll see you again.

Moving on to our next presenters, we have with us, from the district of Chetwynd, His Worship Mayor Charlie Lasser as well as Councillor Bob Nicholson. Good morning, gentlemen.

K. Krueger: If these are worth more than $250, we're required to declare them.

C. Lasser: Actually, if you keep them long enough, they'll be worth a lot more.

I'd like to thank you all for coming up. You've probably seen the rest of the country. Now you're going to see the best.

Just to start out with, I would like to say — and Blair knows this — that 38 percent of the income for B.C. comes east of the continental divide. That's something we should remember. Of course, with these tight times in the gas and oil industry, I think it must be a lot more than 38 percent at this time. A lot of times we are the people who are the drawers of water and the hewers of wood. If we want to bring this province out of the economic slump it's in, this country is going to be one of the major players in doing that.

One of the problems we have in Chetwynd…. We did an industrial expansion, as Blair knows. Unfortunately, it was pegged. For every dollar of assessment of residential, we could only go with three industrial — one of the few places in B.C. that has that limitation. For instance, our residential right now is 5.9776 — let's say 6. Heavy industry on the bond expansion is almost 18 percent, but heavy industry inside is almost 36 percent.

Now, we pay more for a dollar. If there's a $200,000 house in Chetwynd and a $200,000 house in the middle of Vancouver, that resident in Chetwynd is paying more than they do in Vancouver. We have pointed this out. This was an agreement made in the three years I was out of office. It was when I came back in office that it was declared, and we have to live with this.

We have been to Victoria numerous times to try to get a floor put on the industrial rate so that we could drop the residential rate. We're paying too much. We have people paying up to $4,000 on a house. We do not

have public transit. There are a lot of things we do not have, like sidewalks in most of the residential areas. We do not have the services they have in Fort St. John or Dawson Creek. We have to come down with the residential. We want to put a hold on the industrial so that we can drop residential and keep industrial here. But before industrial could go up, we've got to bring it back up to here and then put residential up — which no council in their right mind would ever do — so it would assure industry.

The big problem is Westcoast Energy, the little company that just sold out for many billions of dollars to a huge American company. They're crying poverty, yet in every other area where there is not a limitation, they pay the going rate. So we would like to see that taken into account.

The unconditional grants, I understand — we were told this at the convention — are going to stay the way they are, and that is great. We appreciate that. Smaller communities need that unconditional grant.

There was a question that Ralph had — and I see that he's not here — on why some coalmines are opening up. We are opening up one new mine in Chetwynd right now, and there are going to be more mines. If the amount of overburden compared to the amount of coal…. In some cases, if you have 18 to 1 on removing overburden, it's not feasible. We have one mine starting up which is about 3 to 1. That is feasible. The one we've got opening right now is shipping out 100,000 tonnes and looking for up to a million tonnes in the near future. There's only one place in the world where they have coal like that, and that's way up high in the mountains in New Zealand. Washed coal is 7 percent sulphur. This coal is under 3 percent, and it's not washed. It doesn't have to be. So that's just the idea.

There was another big mine going to be opening in the Chetwynd area from the same company opening the one in Tumbler Ridge, and that will be between 300 and 400 direct employees. That's in a couple of years.

The next thing I'd like to go into is Pine River and that oil spill we had and the disappointment we have with the public health officer declaring that the river is now clean. I think most people in B.C. have seen on TV that I could take big gobs of crude oil out of the sand and the silt. Yet a radio station phoned me up. They had the information. No one had the courtesy of even giving us the information that it was now clear drinking water. I would never let our people drink that water. So there is a problem. As I say, we were assured that before that decision was made, we would be consulted. We were never consulted.

Next, the pulp mill. We have a pulp mill that is down right now, and that is putting an added stress on the community. It is a hardwood mill using poplar and aspen. We don't know when it's going to go back up. They do have some problems, and they are looking for people to come in and buy it out. It's Louisiana Pacific, which is not a pulp company. This is the last mill they've got, and they want to divest themselves of that. We're hoping there will be a Canadian company which will come along and take it over and make it profitable.

Our sawmills are still operating. We have two of the most efficient sawmills in the province, West Fraser and Canfor. Some of the best lumber in the world comes out of the Peace River country. Because our trees grow slowly, the rings are close together, so there is tremendous strength. For instance, with the southern pine they have in the States, you can't walk on a two-by-six because there's no strength there and it'll break. That's why our lumber is needed down in the States. We hope an agreement can come, a negotiated agreement, that will not have to go through this cycle which we have to fight our way through every five to seven years. We're very pleased to see that you people are working on that.

One thing I'd like to point out is that if you're going to make cuts, we would be glad to see some cuts on the environment. Here's how things can be stupid. We had a sewer plant built for 6,000 people. We had 3,000 people in the community at that time. The inflow meter, which means nothing, broke down. To try to repair it, we finally had to bring in a series of pumper trucks, while we're fixing it, to take the sewage around it. After we get it fixed, we get a ticket. We go to court, and we plead not guilty. We did it. They cancelled that ticket, they gave us a far more serious one, and they put an announcement out that we could be fined up to $1 million. Our auditors want to know what's going on. We took it to court, and after probably $50,000 of public money, both provincial and municipal, it was thrown out of court. The judge was very adamant that there should not be intimidation.

I don't care how much anything…. We will not be intimidated. When I was young, because my parents spoke with accents, we took a lot of intimidation. I swore that I would never take that for the rest of my life, and I will not stand for any bureaucrats to come and threaten us. I just want to make that clear.

The next thing is seniors housing. We have some low-income housing which is being built now with provincial government funds, and that is very good. Council has said that we want to see seniors housing, and we will partake in that. We're committed to helping the people who started our community to stay there as long as they want. Home is where your family and your friends are. That is very important to us.

Another thing with both seniors and disabled. As the last speaker said, we would like to see the benefits continued. I visited an old friend of mine who had just celebrated his ninety-sixth birthday. He was telling me that in his days, when he worked, $500 was the most he ever made in a month. These people cannot afford to go out and put out of their pocket for any extra health care. They have to be looked after. This old friend of mine was on the first cat train from Yellowknife to the Arctic. He was a pioneer. We've got to make sure we look after our people who started this country.

Another thing is fuel prices. Coming back on Friday and Saturday, there was a difference of 15 cents per litre between Abbotsford and our area — Chetwynd and even Prince George. Something is wrong; something is drastically wrong. Remember, about four

months a year we have winter up here. You don't just jump in a vehicle and start it up and drive away. You have to warm that vehicle up. There is so much extra, no matter what you do. If it's in the bush for logging — if it's in agriculture, as Bob and I are in — it takes longer to do what you have to do. We would like to see fuel prices at least be reasonable.

Another thing we would like to say — and as long as Blair is in this position, it's fine; if he were mayor, it would be different — is that we have Forestry. This is government-bureaucrat thinking 15 or 20 years ago. We had a sawmill in Dawson Creek, and it was amalgamated with one we had in Chetwynd. We got a sawmill. So to make it fair, they took Forestry from Chetwynd and put it in Dawson Creek. It really made sense, because now they have to drive sometimes three hours to get out to the bush. They do a couple hours' work, and they have to drive three hours back to Dawson Creek.

We have been after Forestry for years. We've shown them where we can actually save money. We don't want the whole office out there. All we want is field office where you can go and see about certain things. You don't have to run all the way into Dawson Creek for it. The mills would benefit greatly from it, but the mills don't want to say too much because they don't want to get Forestry mad at them. So that puts it in a nutshell. We've even got a building for you to come to. We've kept it. We've bought the old Forestry building. We say: "There you are. We'll provide you." At one time the deputy minister said: "If you have a building, we could look at it." We said that we've got one, but that was the end of it. So we would like to look at that, Blair.

One thing about the hospital. This is my own personal preference. I haven't talked to council. There would be a minimum charge for a person going in for a visit to the doctor. That of course could be so the low-income people would not have to pay it. We find that a lot of people who are a little lonely go in once a week to visit the doctor. They can have a nice talk, and that's not what it's there for. I realize this would cost me, because my wife has just had a very serious operation, and she goes to the doctor a lot. Still, we've got to look at what's good for the whole country. If we don't look out, we're going to lose our whole system.

We have to be careful that we can preserve what we've got. If there would be a $5 or $10 charge, I think it may stop, a little bit, people who just go in. You go in. The doctor gives you pills and says: "Come back and see me in a week." If I feel great in a week, I'm not going to go back and see him, because it's another 60 bucks. That's what it's all about.

One of the last things that I've got — and I don't know; Bob might have some things — is Citizens on Patrol. We've had a lot of break-ins in Chetwynd, so we're starting a Citizens on Patrol. We realize that we're going to have to look after some of these things ourselves. We can't rely on the RCMP to do everything for us, so we are taking it. We want to see that, because it's to a point where some businesses are going to go bankrupt because they've been hit that hard. We're afraid that people may take the law into their own hands and would like to see something done. So we're going to be working on that. Hopefully, that might cut down on some of the breaking and entering.

Those are the things that I just jotted down here quickly, because of being at the convention — and of course the health people throwing that loop at us, saying our water was good when it wasn't. Just to inform you, we have drilled wells. We're using underground water. This water is artesian, so it cannot be contaminated. If you wanted to contaminate it, you'd have to put tremendous high-pressure pumps in to put a contaminant in it. This is old water, because all the water in the world since we've had the atomic explosions has something in it, which our water there does not. I don't know where it's coming from, but it's in the mountains somewhere, and it's a lot of water. We want to make sure that we have good water for our people today, for tomorrow and for our great-grandchildren.

B. Nicholson: Actually, no. I think the time is running on. I could speak on a few subjects, but I think you've covered them all very well. I'd like to thank the committee for coming out here and speaking to us. That's wonderful. I like the way you're handling the transition into power, the way that you people are respecting the promises you made. I really am cheered by that, as I think a lot of voters are. I give you lots of credit for that. Please continue on. You are starting on the right road to bring British Columbia back into recovery. We do appreciate it. Carry on.

There are certainly other things that Chetwynd probably would like to speak on. Maybe we can make a written submission or something. But at this point I think we had a good opportunity to speak on our needs and wishes. Again, I do congratulate your government for being some of the most responsive…. I don't think I've ever seen a government that's stuck as close to their agenda and their promises as you people have so far. Don't step off that path, please.

C. Lasser: I would like to just say the same. Actually, this was my thirty-third UBCM convention. This was the best one I ever attended, because everybody was available. That was so important. You people were there. There were different sessions that you were on. I really enjoyed it. As Bob says, keep it up. Everybody in B.C. — 100 percent of us — is going to have to pull together if we want to bring this out of the recession that we're in. We can do it. We can all do it if we work together.

I've always been interested in politics. It's been very intriguing and enjoyable. I would hope that you people enjoy it as much as I have over the years. Are there any questions?

B. Lekstrom (Chair): Thank you very much. I see Kevin; you do have a question.

K. Krueger: Just very briefly, I don't want to be controversial, but we have learned in the last year or so that B.C.'s going to be a net importer of electricity, off and on. Up until recently, independent power production projects weren't particularly welcome in British Columbia, but they are now. I understand that we may have to supplement our need for electricity by purchasing coal-fired generator electricity from Alberta. I wonder if the Tumbler and Chetwynd regions have explored contemporary technology, whether it's environmentally friendly enough that you would want to consider producing electricity from coal in your area and sending it back over the lines that were initially put into service down there.

C. Lasser: Yes, it has been looked at. There are 12 million tonnes in their ponds, which they were wanting to cover up, at Tumbler. This is all material which could go in. It could run a plant for many, many years. All the waste coal that's washed out could be utilized with these new type of plants. I just wish the government of the day, when I was on B.C. Hydro's board of directors, had the courage to put site C in, like we had wanted. Had we done that, it would have been paid over many times.

I was at a meeting that Blair was at. I would like you to look at the McGregor diversion. Right now the McGregor River goes into the Fraser. I spent 16 years on the diking board in the Fraser Valley before I came up here. The last big floods we had were 1894, I believe, and 1948. We're due for another one, one of these days. A lot of times, just when it was ready to flood the Fraser, a few coal dikes in the interior were enough to hold the water back. If we had the McGregor diversion in, we could kick that extra water back into the Peace system. That would alleviate your flood. Now, if you think it was bad in '48, if we get another flood down there and Richmond goes under, it won't be in the billions; it'll be in the tens of billions of dollars. So that could be as much a flood project. When they put Kenney Dam in on Ootsa Lake, it took the flood danger right down for about eight years until more development in the interior dropped the water.

That is something which should be looked at, because the generators on the Bennett Dam can now, with new wiring, increase about 10 to 15 percent. That extra water would generate more, and everything is there to be able to produce more electricity to help this province. Then our 38 percent that we're sending to the coffers could go up to maybe 45 percent.

Coal-fired is something that is looked at. I was with Hydro when we shut down Hat Creek because the efficiency was only 38 percent. But they have new plants now which are about 85 percent efficient. Yes, coal will be a big thing in the future.

B. Lekstrom (Chair): Briefly. We are going to have to move on. We're quite behind.

C. Lasser: I realize that. Wind power is another thing which we would like. We're also looking at taking the wood waste from Chetwynd, in our mills — we've been working on this for about 12 years now — and turning it into ethanol. If you could put 20 percent ethanol into the gas, you would cut down half the pollution in the Fraser Valley.

One parting shot. There is concern in the Fraser Valley about that new plant which they want to put across the border. They're talking about so many hundreds or thousands of pounds a day. In the Chetwynd area, so that we can have gas in the rest of B.C., they have been putting up to 20 tonnes a day in the air in our community for 21 years.

B. Lekstrom (Chair): Charlie, Bob, I'd like to thank you for taking the time to come out and make your presentation. Thanks very much.

Moving right along, we will move to our next presenter. With us this morning we have Darleen Miller who will be presenting. Hi there.

D. Miller: Not too bad. Before I begin, I just want to forewarn you that it's different from anything you've heard thus far.

My name is Darlene Miller. I've been a resident of Dawson Creek all my life. My family and my husband's family are residents of this area. We moved very briefly to Grande Prairie and quickly found out that was not the way to go. When we moved back to Dawson Creek, I chose to go to college to upgrade my employability skills, and I was very fortunate to obtain employment with the Ministry of Skills Development and Labour, the employment standards branch. That makes me a member of the BCGEU.

I'm here today speaking to you as a private citizen, as a person concerned with my future and my family's future. I was going to stand up here and fight for my ministry, but I can't just fight for them. I have to fight for all ministries. The reality is that we may save our local office, but not necessarily my own job. People with more seniority can and will have the ability to displace me. If I were to lose my position, it would not only affect me; it would affect them, their families and their communities — a domino effect. So I have to get up here and say something that will hopefully make a difference.

Mr. Lekstrom, I ask you: where would you be today if you hadn't been fortunate enough to be voted in as mayor of Dawson Creek after the restructuring of B.C. Tel a few years ago? You know the reality of life in northern British Columbia, the economic difficulties facing our families and the hardships of living in this area of the province. We've already seen the closure of

B.C. Hydro and Pacific Northern Gas offices. What private sector do we have to work in? We will be replacing our students in the minimum-wage jobs they currently feel so proud to have — jobs that both my children had, starting at 14 years old, and jobs they had because they wanted to work.

Could you imagine being there now and being told that you have to put forward three scenarios of 20, 35 and 50 percent reductions? Wow, what an effect that would have on our little city. I mean, how much money does an MLA make now? Cut your pay by 20, 35 or 50 percent. Or how about decreasing our electoral regions? Instead of 79 MLAs, we'll only have 40. If we don't have B.C. government services, why have B.C. government representation? It's unrealistic, isn't it?

I don't know about you, but I know that if I lose my job, my household income will decrease by approximately 40 percent. In my home, that will be devastating. There are others who will see losses ranging from 50, 60 and 100 percent. Our world has changed drastically since the last election.

Cuts such as this will have an even more crushing impact on our society. Mr. Campbell says there will be no cuts to the ministries of Health and Education. Maybe not directly, but how many students won't return to school next semester if their parents are losing their jobs? There is your decrease in education. How many more people will be seeing their health care professional because they suffer stress-related illnesses due to increased pressure at work or the loss of their job? There is your increase in health costs.

British Columbia is like a corporation, a very large corporation. When I think of our province this way, it reminds me of seeing a very successful businessman on television after the events of September 11. I hear his tearful lament when he cries: "My people! I have lost all my people." They cannot be replaced. He also indicated he would donate $1 million to the families lost. He wants to donate more, but that depends on his business and the direction he can move in.

His people are gone — their experience, their skills, their many talents. That's 700 families. We're talking 16,000, almost triple the amount of people lost in the twin towers. If we lose people, we will most definitely lose services. Offices will close, and people will be expected to use automated telephone messages and the Internet.

I receive telephone calls almost daily from people trying to reach our local EI office. They are frustrated and angry that they aren't getting through to a real person. They have questions, and they need answers. Many people in our area do not have or want access to the Internet, and most complaints received in our office are handwritten. People come in, and they want to talk. They want to make sure they're filing information correctly, and they want to feel they're not just another number.

During Mr. Campbell's speech at the Liberal convention on Saturday night, he even says things have changed since September 11, and he urges us as British Columbians to do our part, get out and travel, spend money. The stark reality is that I'm not going to spend any money, and I'm not going to travel. It has nothing to do with the fear of terrorism; it has everything to do with not knowing what my future is and what cuts Mr. Campbell will bring. How much he has already decided, who knows?

Terrace and Prince Rupert aren't even included in these rounds of prebudget public hearings. Does that indicate that northern British Columbia is about to become a no man's land? We received virtually two days' notice of these hearings. How much time is that for the general public to prepare? My calculations are that only four people can make a presentation in an hour. That means 16 people in Dawson Creek can come forward and speak. What is that when our futures are at stake?

Mr. Campbell honoured his tax cuts to the citizens of British Columbia. Thank you. I'll give mine back. If it means I can keep my job, he can have my tax break back. Mr. Campbell says B.C. is open for business. At what cost, Mr. Campbell? John F. Kennedy said during a television interview that you have to meet the needs of the people. All these government cuts, all this uncertainty — Mr. Campbell, you are not meeting the needs of your people.

Thank you for allowing me the opportunity to speak today. I'm hoping that our elected government will indeed take our concerns into account. Can we be as fortunate as the workplace smoking issue and ask for more studies, and yet again another one and maybe just one more before you make a decision?

B. Lekstrom (Chair): Thanks, Darlene. Just a couple of things. We will be visiting Prince Rupert. We're trying to get to the northwest. We're trying to cover 16 communities throughout British Columbia. Our time frames are short. For the people that can't get out to the public meetings — and I know the time has been short notice, but we're working on that — we do have the ability to accept written submissions, and they will receive full consideration as well.

You brought up a valuable point. We realized the short notification was going to be a concern, and we began the process as quickly as we could, but you've brought up a valuable point there.

J. MacPhail: I have one. Ms. Miller, thank you very much for that presentation. You said that you contributed about 40 percent to the family income. You may not want to answer this; it might be too personal. But what happens in terms of family decision-making if you lose your job?

D. Miller: Well, I know my daughter may not be able to go back to college in January if my job were to be cut. She'll have to get out and work for a longer period of time. My kids are working; they've always worked. She has contributed to her education as much as she could. She even sold her car so that she could

attend school. We don't live high; we live frugally. We want our kids to get a better education, and that's why my husband and I both work.

D. Miller: No, not at this time with my son still in school. He doesn't graduate until September.

B. Lekstrom (Chair): Darlene, thank you. Your presentation was very worthwhile, because it is a concern. As I said earlier in the day, the decisions that have to be made are not easy decisions. I've sat in the position that you're speaking from. I spent 18 years with the telephone company, and I learned a great deal from the labour side. But it's really about balancing the people of British Columbia and trusting the 79 elected people to bring that balance to the table. Hopefully, we'll be able to do that. All right. Thank you.

We will move on now. Our next presenter this morning is Jim Podger. Good morning, Jim.

B. Lekstrom (Chair): Good. Apparently it's afternoon — just. Good afternoon. Welcome.

J. Podger: First of all, I'd like to make a couple of comments. I'm one of the people who are not naïve enough to think that getting cuts in taxes won't come at a price. That's probably the reason we're here right now. I'd like to thank Joy for being here especially and keeping everybody in line.

J. Podger: It's an old-age thing. My paper handed out had to be edited a little bit. Someone pointed out that it's "good afternoon."

My name is Jim Podger. I'm here today to express my point of view on the proposed cuts of up to 50 percent in services in government. One is as an employee of the province of British Columbia, and the other is as a taxpayer of British Columbia.

First, to give you a bit of background on myself, I'm employed with the Ministry of Forests. Currently, I am the district scaling supervisor in the Dawson Creek forest district. I have been here for the past three years. I've worked for the ministry in several locations throughout the province, in the scaling revenue section, for the past 21 years.

My position in Forestry is quite technical. I run a stand-alone program in this district, where other districts have up to four positions. The bottom line in my job is in revenue, bills collected as a result of scaling the timber delivered to any mill in the Dawson forest district. I develop, maintain and monitor strata plans that are entered into the computer system at the large mills that use weigh scales. These plans are pre-select loads for sample purposes to determine ratios for timber within that same timber type, which are then forwarded through me to Victoria for billing. I also check the accuracy of industry employees who run those scales, measure the timber and process documents. I also train where there are deficiencies.

I've maintained contact with the small mills with similar functions. I ensure that timber required to be scaled is scaled and billed. I conduct investigations in trespass, log thefts, as well as conduct waste assessments. I also deal with the enforcement agencies and issues as they happen. I work with the RCMP, ICBC in transport issues and roadblocks, and prepare court documents as required. I try my best to protect and collect financial revenues owed to the Crown. I sort of look at myself as a guard at the vault, I guess.

Contracting-out or eliminating this program would not be good for the Crown. In 1983 the government of the day made the biggest mistake I could think of in my department. It contracted out the scaling function to industry. As a result, the phrase "the fox looking after the chickens" really took meaning. The loss, I believe, to government revenues is immeasurable. It still continues to this day. Basically, all sawmill companies tell the government how much stumpage they'll pay by scaling all the timber that arrives at the site, by their employees. To get a better idea, that would be like going to your local supermarket, loading up your cart with groceries, giving the cashier 20 bucks and leaving without the cashier scanning it. Wouldn't that be great? That is, in reality, what is happening.

It could only get worse by reducing more staff. If anything, the government should be increasing staff, making all scalers government employees — to ensure scaling is done correctly, without influence, to protect the Crown's interests. In short, I don't know if scaling is threatened, but I know that if it is, the financial implications to the Crown would be devastating. I am, however, very concerned about my co-workers. They are all excellent in their field, and to lose any would be a burden on other staff and departments to pick up. There are some who are overwhelmed by the workload left after the last round. Some refer to this as mental terrorism by government. Job security is lost.

I work in an office that has already taken a hard hit from the last round of cuts from our government, and I notice a big change in the way the employees seem to be reacting to their traditional dedication to their job — to being as dedicated to their job as their job is to them. Staff is already overworked, overloaded with work. Field inspections from our office have been reduced. Other parts of our job are being risk-managed, leaving these things not even looked at, and they fall off the table. Many feel their job quality is suffering.

I've seen in the past years how layoffs have affected lives of truly devoted employees, devastated and destroyed people through divorce and bankruptcy. People have to look for new jobs in markets that don't exist due to closures and reductions. Seldom, if ever, do you hear of someone who has been laid off and has gone on to a better life in the field of their training. You hear more of them becoming statistics on the EI and social service lineups or even worse. I point this out because I want to be sure you understand that this is not a num-

bers game. These are lives, people who pay you. These are relatives — brothers, sisters, parents and children — co-workers and neighbours. With every person that loses their job, this potentially puts further burden on the other provincial services as well as the community, forcing people to move to another community or out of the province, reducing the revenues to the community tax base and small business and resulting in a chain reaction of further layoffs. I wonder how you'd be able to handle that when you lay off 50 percent social services staff.

Has this threat affected me? Yes. Purchasing has stopped, except essentials: cable, heat, power, fuel. Food shopping is reduced and travel stopped. Travel for Christmas and gifts and vacation — cancelled. Real estate has viewed my home. Paranoid, you think? No. I, like many, just don't trust my employer.

As far as other ministries are concerned, again, you're very lucky to have the people you have. As a new government coming into power with a trainee staff, as you have, you should consider yourself very lucky. To lose that by laying off the staff and the risk of financial loss by having to retrain them in the future could be more costly.

Currently, by last count at this office — the Ministry of Forests office in Dawson Creek — we have 45 regular, two half-time, four management and four regional protection staff. To cut that in half would leave 27 employees. This would be devastating, to say the least: 27 homes on the market, a potential loss of $80,000 a year in property tax. As a taxpayer, I always look at government as a leader. If the government wants to pull us out of the recession, then they should do so by example. Hold strong.

If not, the public would look at the province — you're going to like this — as an employer as they would a McDonald's: get the experience and get out. This would result in continuous turnover and training costs. We're experiencing some of that now. Specialty people would then belong to industry, leaving government with less than state of the art. Ministries are supposed to be the resource for industry where they can get expertise. They're supposed to be the best.

I know you hear this all the time, but if my government services were cut by half, I would expect it to reflect on my provincial taxes, which it won't. If government does do cuts, it would be like going to a restaurant, sitting down and getting a bill without the food — paying for something you didn't get. You can think about that over lunch.

There are other ways to get through this. All you have to do is ask. You might be surprised at what the people who work for government might have in mind. But if you do talk to the employees, don't expect them to e-mail you or chat in a group. One on one, with confidence of no repercussions, is the only way that it'll work.

B. Lekstrom (Chair): We will have to go through it fairly quickly, James, if we could, in our time frame. Thank you.

J. Podger: How could we avoid the proposed layoff? Some of my thoughts: increased stumpage on aspen and cottonwood and grade logs. Currently, the stumpage payable on aspen and cottonwood is 50 cents per cubic metre and 25 cents per cubic metre on all grade logs. To put that in perspective — these are estimates — if you sold a load of aspen logs from your own private property to a mill in Dawson, you'd get around $700 to $800 a load. If it was stumpage Crown wood sold to that same mill, that brings around 20 bucks a load. If that rate were raised by a dollar, the revenue provincially would probably fix the shortfall and still have more left over. I believe this would be of little impact on industry as well.

Further prospective estimates, again: a load of logs off Crown land could bring about $50 a cubic metre in stumpage. That rate, estimated by an average of about 45 cubic metres per load, brings $2,250, as an example. If that same load of logs were grade logs, it would bring a total of $11.25. These are facts. That's where the problem is, and that's where it should be fixed.

Another area to look at is: how about the surcharge for loads arriving from Alberta? There were around 5,000 loads that arrived in this district from Alberta — just this district — with wear and tear on our highway system. That could be an area for revenue.

I. Chong: Thank you, Jim, for your presentation. You've obviously put some thought into how to increase revenues, which is important; it's part of our prebudget consultation. Just one question on your thoughts. You were talking about the aspen logs, and you said you believe it would have little impact on the industry. Is that just a perception, or have you in fact talked to people in the industry? How do they feel about that proposal?

J. Podger: I've had some discussions with some of the industry. Even giving them the impression…. If the stumpage rate was even doubled, would it really hurt? They basically say no, because they're only paying maybe $800,000 a year in stumpage to run the whole year. That's just a guess; I'm not sure how accurate. I tried to get accurate numbers for you, but our computer system, for some reason, is provincial.

I. Chong: I was wondering if there were other impacts on jobs and things like that.

J. Podger: I don't believe it would hurt any, especially when you have an increase in stumpage rates which are effective today. I haven't been to my office

yet this morning, but rumour is that stumpage on regular sawlogs, not including aspen and cottonwood, went up $7 a metre effective today. That's just rumour. I don't know because I didn't check today. So if it's going up $7 a metre on regular logs, 50 cents or a dollar on aspen and cottonwood would be nothing.

J. MacPhail: Just very quickly. Is anyone in your ministry asking you for your views as part of the core services review? How do you get input as a public employee?

J. Podger: Like I mentioned in here, there is some hesitation for employees to go further up the chain, if you like, because of repercussions that could come.

J. Podger: No, we've never been asked. But from other past experience, a lot of them won't say anything. They just sit there.

B. Lekstrom (Chair): I have Jeff pushing to speak. Then, if they are quick, Barry, I would entertain that, and then we'll carry on to the next speaker.

J. Bray: I was also a public servant before this — 13 years with the Ministry of Human Resources. Our ministry was very good at promoting the employee suggestion award and other programs for getting ideas from departments as well as individuals. Is that promoted in the Ministry of Forests?

J. Podger: It's there, and we know it's there. Again, there is hesitancy within our department. I have tried to bring this up in a somewhat private little chat with our assistant deputy minister, and he wrote a few comments down. But I've never heard anything at all about it, so I don't know if they're really interested in looking at this or not.

B. Penner: A question for Jim. Does the employer not currently solicit input through suggestion cards or a comment box? I'm going back to my somewhat distant history of working for the Ministry of Environment, Lands and Parks as a park ranger, and I know there were awards given to public service employees who came up with valuable ideas that could be implemented by the government. Has that not been taking place recently?

My second question — I think Blair is about to cut me off — pertains to your suggestion, which I think is great, about the stumpage on aspen and other wood. Do you have any estimation as to the total amount of revenue that could be collected if we moved to that system? I ask that question because this year alone we're facing a $2 billion deficit, and according to the fiscal review panel, that could balloon to about $5 billion by 2003-04. So we've got significant ground to make up here, and I'm just wondering how much this…. I'm not expecting this measure in itself, of course, to make that up. I'm just wondering if you have a ballpark figure.

J. Podger: Again, because I knew that question was going to come up, I tried to get that information off our systems this morning and, actually, during the weekend — sneak in the office. But the computer system was down to get the actual numbers. I think the revenues just on aspen and cottonwood alone would cover a lot of that provincially. I'm just guessing at the numbers. I'm sorry I don't have them. If it was $800,000 in stumpage that one company paid just in here, the one mill, I'm sure the other ones could cover it off. You've got Louisiana-Pacific; you have one in Chetwynd; you have Woodland — a smaller mill which ships their wood to Ainsworth Lumber in 100 Mile House — and all the other aspen that goes to 100 Mile House. So there's a big market in aspen as well as the grade logs. Going from 50 bucks a cubic metre to 25 cents in the estimate of looking at a log is ridiculous.

B. Lekstrom (Chair): Jim, just in closing, I'd like to thank you for your presentation. It certainly, as you indicated, differs from many views. But the reality is, in all honesty, that there will be changes in the provision of services. That's what we're doing: listening to the people of British Columbia to see if we can learn, try and encompass some of what we hear into the report that we put together. Thanks very much.

We will move on. Our next presentation is from the Northern Lights Real Estate Board, and here to present is Lloyd Smith. Good afternoon, Lloyd, and thank you.

L. Smith: Good afternoon. What I've brought is two different items and a copy for each person, which you can review later. I won't go into great depth on them so that we can make up a little time here for the next person.

The first item I wanted to go over, and this applies to all realtors in British Columbia, is the Assessment Amendment Act. What basically has happened there — and this isn't something that's going to cost us any money, you might be relieved to know — is that the name of property owners has been taken off the B.C. Assessment roll for realtors because of the Privacy Act. They feel that we shouldn't know who owns the particular homes. Yet if we or any member of the public goes down to the office, it's still available. What they've done is taken it off all the rolls so that realtors can't do mass mailouts and promote in that way, because they felt that was an invasion of the Privacy Act.

We're asking that it's put back. Amend the Assessment Act to allow the real estate industry to continue receiving name data on the rolls as part of the bulk purchase arrangement that we now have with B.C. Assessment. This may sound like a very small item, and in the great scope of things it is. However, it makes our job a lot easier if we get the proper legally binding owners' names when we do a contract. Right now it makes that a little difficult. It's a small item, and I don't think there really is any invasion of the Privacy Act per se when they're giving the information out to the public at will.

I'll just leave that. It's an old brief, done by the BCREA, the British Columbia Real Estate Association. You've each got a copy, and you can review it at will.

The No. 2 item that I wanted to bring up…. Well, actually there were three. The streamside protection act is not really very applicable to this area as of yet, and I'm sure you will probably get involved in that in the lower mainland.

L. Smith: You're working on that one. That's a delivery service, once again. If we could just streamline things where we can get decisions made in an orderly fashion, it will help the industry in a great way. The one that does cost money would be the elimination or reduction of the property transfer tax. That's an item that's been on the agenda for many years, ever since it was put into place. That is a very costly item for all the people of this province, when they have to pay 1 percent directly to the government every time they buy a home. That's 1 percent up to $200,000 and 2 percent above that. By eliminating that, you could eliminate probably up to 50 percent of what it costs a homeowner to purchase a home in terms of money down at the time.

Once again, this brief actually goes through it. If you look at the executive summary, it will show that it is possible to make that up with more transactions, because it is a stumbling block. If you have to have, especially in the mainland, $5,000 up front before you can buy a house in terms of extra costs above and beyond what it actually costs, above and beyond what the down payment is, it becomes onerous in some cases. I'll leave that brief with you, as well, and we can go on to the next.

B. Lekstrom (Chair): Lloyd, I'd like to thank you. Are there questions from members of the board?

I. Chong: Thanks very much, Lloyd. You're very correct in that it was brought to our attention about the Assessment Act and the issue of privacy. I'm certain that if your association feels this is a barrier to economic growth and a barrier for business, then certainly you could suggest that it be resubmitted to the Minister of State for Deregulation, because he is looking at those things.

I was curious about your recommendation about the elimination of property transfer tax. I've certainly heard this in the past as well. In the context of that, is your association suggesting total elimination? If so, would that be immediate, or would you look at a phased-in approach and those kinds of things? As you know, our prebudget consultation will allow for the Minister of Finance to review this if those suggestions are such that they include a transition, shall we say.

L. Smith: It does, actually. This submission that I'm giving you now was actually tabled on November 22, 2000. It's one year old, but it's still valid. Yes, it does allow that for two or three years you could do it on a limited basis. I mean, you're the government of the day. You can do what you wish with it, but what you should do is take a look at the table in there where we're trying to suggest that perhaps the stimulation of the economy would warrant some change. It could be done over two or three years. You could implement it back.

I. Chong: On that, has your association done any study or research to determine how soon a phase-in approach would stimulate the economy versus elimination immediately — whether that would stimulate it quicker? Have you any statistics you can share with us?

B. Penner: Lloyd, I was very interested in your comments about the streamside setbacks. Coming from Chilliwack-Kent, those regulations are very worrisome. One view to increasing the amount of revenue that the government has is by encouraging economic activity. That's one way to narrow the $2 billion deficit we're facing this year and significantly greater deficits in future years if action isn't taken quickly. Any suggestions or comments you have about reducing unnecessary or ill-advised regulation would be very welcome, at least in my view. Feel free to follow up with the committee in writing or with me directly, if you'd like to, particularly pertaining to streamside setbacks.

L. Smith: Like I said, it hasn't reared itself in this area in the north yet, but I know it has down in your area. I've talked to a number of realtors in the Chilliwack area and Langley, etc. It is a much bigger problem there, because you have much higher property values and a lot of industry problems. A lot of your land is owned by industry, so you've got some huge numbers. One of the comments that a lot of the realtors spoke about — actually, it was on September 11, at my last meeting down there — was the fact that even if

you keep the legislation, there has to be a process in place to look after it properly. If you're trying to sell a property and it's $2 million and all of a sudden you find out that 30 percent of it is no longer available to sell, this has to be looked after right away. It's a process problem, because all we're really talking about is a furthering of the setbacks from the stream.

L. Smith: They are dramatic, but there should be a process in place that can say that this really isn't affecting our area — say in Chilliwack, where the little stream is coming through. There has to be some hard decision-making made in an orderly fashion to accommodate that. Otherwise, you won't have economic growth on the mainland.

I want to make the point again that regulation has a cost both in affording economic activity and in generating more revenue, and it costs government to enforce that regulation, which in some cases is accessible and necessary. You drive up government costs while reducing government revenues.

B. Lekstrom (Chair): Lloyd, once again I'd like to thank you for taking the time to come forward to make your presentation. We'll take your submissions and certainly utilize them in the development, through our discussions, of putting together our report due on November 15.

We will move to our next presenter, which is the Peace River regional district. I see that Chairman Karen Goodings is here as well as Director Larry Houley. Good afternoon and welcome. Thank you for your patience.

K. Goodings: Thank you for coming to the north. Before I begin my brief presentation, I just want to say an overwhelming thank-you to this provincial government for the continuation of our Fair Share, which is critical to our municipalities and less critical, but still critical, to our rural areas as well. So thank you to the government for assuring us that that is in place until 2007.

It seems that Charlie Lasser didn't take any credit for the weather. We'll take it. We're really pleased that our weather is accommodating and is absolutely gorgeous. It allows you to see the beauty of the Peace.

I believe you got my brief presentation. Thank you for allowing us to present our views to you on your undertaking of the fiscal review for British Columbia. I believe this is a critical time for this province and that you seem to be headed in the right direction. Although I did not get the copy of the panel deliberations until Friday night and have not had time to fully digest the material, I do appreciate this undertaking. Because we were not aware of the review until mid-week during UBCM, I have not had an opportunity to discuss this response with the Peace River regional district board. My remarks, therefore, are my own as a director of area B and not necessarily the views of the Peace River regional district.

First, I want you to be aware that the North Peace economic development commission, consisting of representation from the city of Fort St. John, the districts of Hudson's Hope and Taylor and the two rural areas, is proceeding with an economic study. We are aware that there has been a tremendous drain of business from B.C. to our neighbouring province of Alberta. This study is intended to document the facts relating to that movement of business. We believe there is a benefit to having this factually documented so that we can pursue initiatives that will bring that business back to B.C.

One example of this is: a drilling rig coming into B.C. to drill wells, which brings with it the equipment and manpower, does its purchasing through Alberta and even brings in its own caterers. When their paycheque is made out, it is sent directly to their home bank, and that money does not create any wealth for B.C. The jobs lost, income tax lost, are definitely a loss to the province. Hopefully, we can get this economic study done in time to be of some value.

Second, and you've heard this one before, I need to make you aware of the deplorable condition of our roads in the northeast. Building roads has tremendous benefits both in job creation and in money in the pockets of our consumers. It is wonderful to maintain the funding for health and education, but if we can't get to the doctor, it does us little good.

The third point is on the assessment of our pipelines. Although the assessment authorities that we met with during UBCM tell us that they have increased their staff in this region to assess the properties and pipelines, I would say that many pipelines are still not being assessed in a timely manner. This has been a point of contention for a number of years. I would like to see you check on the length of time from the application on installation of a pipeline to the assessment of the pipeline. I know, in fact, that in one case a line was operating for three years before the surveyors did the final survey, which I believe is when the assessment kicks in. There's a bit of a double message, if I might just ad-lib a bit, because we have had an increase in those people who are out assessing. Please be aware that up until that increase came, we were very, very far behind. In fact, we know there are still unregistered pipelines. These are our gathering lines. They aren't the huge pipelines, but they are the thousands of miles of gathering pipelines that take the gas from the wellhead to the pipeline that carries it further.

The Peace River regional district has been pursuing, both federally and provincially, a 30 percent investment tax credit which would encourage our private sector industry to develop an ethanol industry in B.C. We would appreciate provincial support of this initiative. The production of ethanol would assist Canada in reaching its goals of the Kyoto agreement as well as utilizing both forestry and agricultural waste material. I believe Mayor Lasser spoke very briefly about that.

Director Houley and I have agreed that we would share our brief 15-minute time with you, and I will now turn it over to him for his valid points. If you have any questions, I would be pleased to try and answer them.

L. Houley: Thank you, Karen. It's a pleasure, as well, for me to be here this morning. I thank the hon. members for taking the time for this worthwhile endeavour. I speak representing area C of Peace River regional district, the businesses and the residents of that area, and not as a member of the board.

I will keep my remarks to regulation. I'd like at this time to express my happiness for being here but also sadness — the sadness being that I used to be in business for a number of years. I have all the business equipment. I am not in business anymore. I am not producing. The 40 people who used to work for me are no longer in my employ. Why has this come about? It has come about because of regulation, not taxation. If it had not been for regulation, I could have paid $500 a day — that's what I estimated — in further taxes if regulation would not have been in my way.

That being said, I see a good part of our problem as being overlap of jurisdictions. What should the federal government do? What should the provincial government be doing, and what should the local governments be doing?

To move on with that, I will use three specific examples. We heard here earlier about the need for increased revenue from stumpage — a very valid point. However, there's also a pulp mill closed in Chetwynd. How do we get those people working? We could increase their revenue from stumpage. How would we keep employment going? How would we keep our mills going? I'm fully aware that we're in a world market today, not a provincial or local market. I'm fully aware that the province of Quebec is producing studs at $258 a thousand today, when Chetwynd's Canfor mill is producing just a bit under $400. This is the challenge that we face.

One area that I would like to cover is that since the 20-some years I've been in business in B.C., I own a mobile home park, and I've been in that industry in Alaska, the Yukon, Alberta, Saskatchewan and here. Why do we have such a body as a mobile home registry? Why does this body exist in this province? It doesn't exist anywhere else. It is a needless body. I'll use one example. Blair is probably aware of it. A few years ago, if somebody was bringing a mobile home to the region, they'd get to the scales. A transporter, not being familiar with this body, would be held up. He would be told that the mobile home had to be registered. The owner of that unit would have to find a lawyer while it sits there, at a cost of $500, and register that unit. Then, when they got the clearance, they'd haul it one mile into Pouce Coupe when they were doing that subdivision there. Before the owner, that individual, could get any money from the bank, the mobile home had to be deregistered — another $400. It was attached to the land and taxed with the land.

We're concerned here about the layoffs of people as well — a compassionate situation each one of you has to face. However, the hours that are spent in assessing every mobile home and every park could easily go into such things as pipelines, as Karen was suggesting. It's one suggestion I would make. The rest of the body could be eliminated. I operated in other jurisdictions, and it doesn't exist there. Why does it exist here?

Another area would be the permitting of loads on the highway system. If it is a provincial highway system, then only the province should be issuing those permits — one jurisdiction. Here, when you get to oversized loads, it gets into every community — even to Indian chiefs on some reserves who permit movement of that load. That is intolerable. It has rendered my business to the point where I couldn't function anymore in this province. I did very well in the Yukon and very well in Alberta. Today the cost of moving a house in Dawson Creek is roughly $10,000, if you can find somebody to do it. Today the cost of moving a house in Grande Prairie, Alberta, is $3,000. I could make money in Grande Prairie, Alberta. I cannot here anymore.

My recommendation for that, I think, is really important here. It's very simple. If I were to present to you my daily planners for the last ten years, you would see in each jurisdiction the way I operated. Other than B.C., there was one number to contact for that load. In B.C. there were four pages. That's the fact of where our economy is. I wasn't producing here at any cost. My recommendation is: look at what they're doing now. It's working. Why not here? I as an individual, as a businessman — as so many of us are, good businessmen — can go to these other areas and make money. Why should we not be doing it at home?

Another suggestion I have has to do with the Agricultural Land Commission. This is more a matter of jurisdiction. Should the control of our agricultural land be in the provincial domain? I would suggest that this body work with local government and within two years set the framework on how farmland should be protected in this province. And that jurisdiction should be local.

B. Lekstrom (Chair): Thank you very much, Larry. I will note that Director Albert Erbe from area D has joined Karen and Larry as well. Good afternoon, Albert.

J. Bray: I just want to thank you both for your submission. Larry, it sounds like you have 20 years worth of experience in dealing with business and regulation. I would strongly encourage you — and I know you had, as you said, two days to get ready — to put your thoughts and suggestions down and submit them to Blair and also to the Minister of State for Deregulation. I think you've hit on an important point. In your view, it was not taxation; it was regulation. We really need

the expertise from the people on the ground actually doing it to provide those suggestions. I think a lot of the answers exist in the communities. The Peace certainly has a strong voice in Blair, but we need citizens as well.

Please, I think it would be invaluable to have your experience — and the impact it would have — and your suggestions for possible ways of alleviating that. I'd just encourage you to submit that both to Blair and to the Minister of State for Deregulation.

R. Sultan: Director Goodings, again an excellent presentation. You refer to the job loss and income tax loss through drill rigs coming in from Alberta, doing their buying and everything — support, infrastructure — out of Alberta. Indeed, the implication here is that while they're working in British Columbia, they're paying their taxes in Alberta. Is that a common situation here? How common would you guess, just off the record?

K. Goodings: Until we get this economic study done, I don't think we'll have those answers. From time to time I've had the opportunity to visit drilling sites, and when I've looked around the site at the vehicles, they are not B.C. plates that I see — not on the caterers' trucks, not on the vehicles that are carrying the workers to the site. I think it is a very common occurrence. We do have workers who work in other parts of Canada as well, but I think there's maybe something we can do to encourage more at home.

B. Lekstrom (Chair): All right. I see no further questions from members of the committee.

K. Goodings: Did you wish to have Director Erbe? He was actually originally scheduled to be with us, and then — a bit of a scheduling problem — he wound up at 12:40. I leave it to you.

B. Lekstrom (Chair): I will accept a couple of minutes. We do have one more presenter, and we do have to adjourn fairly shortly following that. Albert, if you'd like to present or join us briefly.

A. Erbe: Mr. Chair and committee members, thank you very much. First of all, I did not belong to that duo there — not that I'm not like-minded or like-thinking. Well, good morning, ma'am. Joy MacPhail, how wonderful to see you.

A. Erbe: First of all and foremost, I had a few items on my mind. It's an oral presentation and won't be as excellent as the one from Director Goodings and the other member.

My name is Albert Erbe. I also sit on the board. I guess I don't have to tell you that I immigrated to this great country; my accent will tell you that. I've been here for 50 years. All that time I've been in businesses of agriculture and forestry, and I have a broad understanding of the activity of the marketplace. I've not only received a paycheque; I also made paycheques.

What just came on the agenda here: what shall we do so that we don't lose economic activity? I want to follow what was said already: harmonize our taxes with the neighbouring jurisdiction. That's most important and most vital. We are living in a world economy, and I think no longer can we isolate ourselves or build a Berlin Wall around us. We are sitting on the border with Alberta, and they are very progressive in their economic activity. On the other side, the southern part, is the States. I don't have to tell you what their tax structure is compared to ours.

Having said this, I think our social security tax came on the agenda, most likely, already this morning. That's happened, and what's there now, as far as I'm concerned, you should wipe off, if possible, and recover the tax somewhere else. Alberta hasn't got it; the United States hasn't got it. The bordering states haven't got it. I don't care what people will do; they will avoid paying taxes. So instead of being productive, they are going to seek avoidance of paying their tax. You're losing a great part of our economic activity by going outside our boundaries, our jurisdiction and purchasing there.

I'm still presently running a feed mill, and I can truly tell you the little bit of money we'd be making right now and that $500,000 is purchased and brought into B.C. for agricultural use and implementation. So we're losing a great part of our economy and employment to the neighbouring jurisdictions, including the States. The PST, as far as I'm concerned, no longer serves a purpose. I think there's too much avoidance.

I'm a farmer, and my son is now farming. I find, on the agricultural side, with the capital improvement tax right now farmers have a $50,000 exemption on capital improvements, buildings. Anything over $50,000 goes to the residential property, and then you pay full taxes on schools, hospitals, etc. That should be increased at least to a minimum of $200,000. I think the last time the adjustment came in was in '82 or '72, and it's no longer accommodating.

Farmers don't build. They just ignore building on account of it costing them money and taxation, and you undermine the economic activity, particularly in construction. No wonder we lost last month, or the last three months, 10,000 jobs in the construction industry.

Our Premier said that you're going to recover by cutting the income tax, but in my opinion, it does not always work. Tax cuts only work when the economy is

growing, in my opinion, and it has to be seen. I hope it materializes and our economy will grow, but we have a worldwide recession, and I still doubt — well, it's hypothetical — that it will grow.

So how will we recover that money, having a real hold of this money? I think there's too much tax avoidance. I do believe the province should institute a flat tax for property owners. Too many people get away with nothing, but they use all the social amenities we present: hospitals, health, schools, recreation, whatever it might be. A flat tax, of whatever might be decided, should be instituted. Many people just pay $100 or $50 or nothing at all, and they feel it's quite just. That would be part of the recovery, and I think you could recover, most likely, the 7 percent you would lose on your PST.

I'd like to touch on the Crown corporations. I have this wonderful booklet. Supported debt and unsupported debt — as far as I'm concerned, that's all hogwash. Half the debt is supported by taxpayers, and if a Crown corporation doesn't make any money, you have to dish out the money anyway, so nothing is tax supported or Crown supported. Make it plain and simple. Every debt by a Crown corporation is supported by you and me.

What I suggest is: don't lose…particularly when you address Crown corporations which are vital for our welfare and existence. I'm speaking about power, water, etc. Those corporations should be partly dismantled, but only to the extent that you don't lose control. For instance, B.C. Hydro — I see nothing wrong if you would dismantle B.C. Hydro by 49 percent and still keep the majority held in government hands. Therefore you would control the efficiency. New investment would come from the public sector instead of going to moneylenders in the United States. People would invest money in the province. The money would stay here also. You would have more purchasing power.

B. Lekstrom (Chair): Albert, I would like to thank you for getting back. I'd seen you earlier, and I know that schedules are tight.

A. Erbe: Mr. Chairperson, I have to apologize. I'm extremely busy. I didn't have time to make all the presentation. I don't know. Did the members follow what I said?

We will move on to our last registered presenter. I know there are two that would like to get in if we have a few moments to ask questions after. I will go to the city of Dawson Creek: His Worship Mayor Wayne Dahlen is here to make the presentation. Good afternoon, Wayne. I apologize for the time frame.

B. Lekstrom (Chair): Jim Chute as well, the city manager for Dawson Creek. Good afternoon, Jim.

W. Dahlen: Well, that sounded good coming from you, Mr. Chairman — calling me Your Worship. [Laughter.] I addressed you as Your Worship.

Ladies and gentlemen, welcome to Dawson Creek. On behalf of the citizens of Dawson Creek, we welcome you to our fair city. I want to thank whoever made the decision to have the standing committee come here and visit us.

W. Dahlen: Kevin, I believe you were a resident of Dawson Creek, as well, at one time.

I, too, want to echo what Karen Goodings said. We want to thank the government for continuing the Fair Share. That is good news to us. It means a lot to us as far as infrastructure and the things that we have to do up here in the north. I also want to congratulate the government for the community charter. We heard about that at the UBCM convention. I think it is good news and something that we as a municipality look forward to as we get into that charter.

I assume that you have a copy of our presentation. I apologize because it is so short. We were at UBCM. Jim kindly put some of my thoughts down and put it together. I'll just quickly read through it, and then we'll open up for some questions. Jim will answer any of the technical questions that you may have.

The city of Dawson Creek concurs with the public statements of this government that health and education should be the priority of the government. Within that context, the city of Dawson Creek urges that proper attention be paid to regional differences when allocating funding in these areas. The northeast of B.C. is distinct in geography, economy and population. Successful service delivery models will need to recognize this uniqueness.

The city of Dawson Creek believes that secondary provincial spending priorities should first focus on public safety issues. In this regard, policing is a particular concern. In northeastern B.C. most areas fall within the provincial policing mandate. Any reductions in service in the provincial RCMP will have negative impacts on our region. The city of Dawson Creek, in conjunction with regional partners, may soon be in a position to present a proposal to government which could significantly improve police services in this area of the province at no additional cost to the province.

The maintenance and upgrading of highways and rural roads is also a significant public safety issue. It is also an area where the government can see a return on its expenditures. The city of Dawson Creek believes that there are many places in our region where up-

graded roads would return additional fees, permits and royalties to the province. The city of Dawson Creek has offered to the minister our willingness to participate in a regional transportation authority where decisions could reflect some of these realities.

Finally, the city of Dawson Creek would like to bring to your attention an area where the province may be unintentionally forgoing revenues. With our proximity to Alberta, local businesses struggle to compete with our sales tax–free neighbour. This situation is worsened when significant items such as ATVs, snowmobiles and motorcycles are purchased in Alberta and return to B.C. There are already regulations in place which require registration and payment of sales tax, but these are loosely enforced. As a result, the province is deprived of revenue and local businesses hurt. More focused enforcement could solve these problems.

Thank you for the opportunity. We're now ready for any questions should you have any.

B. Lekstrom (Chair): Thanks very much, Wayne, for your presentation. Do we have any questions?

J. Bray: Your last point is interesting. Let's take snowmobiles. Do you have an idea of the percentage of snowmobiles that would be purchased across the line versus here? Are we talking about 2 percent of purchasers, 50 percent of purchasers? Do you have some sense?

W. Dahlen: I would say it's probably closer to 50 percent, maybe more, that would go across the border. You can drive down to Beaverlodge, which is an hour away. On a big-ticket item, like a $12,000 quad or a snowmobile, you can go down there for a Sunday afternoon drive or a Saturday drive and save yourself $700. It's pretty significant.

There is provision, apparently. ICBC has provision. We were told this by our local — he used to be our manager — Dale Bumstead. He said there is provision in the regulation, if they wanted to, to register and enforce. Just like you can go down and buy a vehicle, when you come back, you have to register it to get insurance and a licence. Somebody has to have the will to enforce that.

B. Lekstrom (Chair): Are there any other questions from members of the committee?

Again, the notice was short for all presenters, but we're encouraged by the participation we've had here this morning and what we've heard. So thank you very much again.

We do have a couple of others that we will take a couple of moments to hear from. I see His Worship Mayor Fred Jarvis, from Taylor, sitting and taking in the discussions. At this time I would like to welcome and hear from Fred. Fred, welcome.

F. Jarvis: I'd like to say thanks, as well as everyone else, for coming to the area. We've often felt left out in the past. I think it's very worthwhile, and this area can do a great deal for the province, as has been mentioned earlier. I'm not going to talk about very much. Due to circumstances, I couldn't have a written brief and I wasn't registered. Those circumstances were beyond anyone's control.

One of the things discussed here this morning quite a bit was education and health care not being cut. A lot of the importance in the education in this area…. Most of the time when people talk about the Ministry of Education, they think of K-to-12. They don't think about the advanced education. I believe that advanced education in this area, as it is growing and has grown in the last years, has been a tremendous benefit to this area and the people of this area and also to the province. Many people who never had the opportunity to get advanced education have been able to do it. There have been some cuts in those areas. I would hope that the service wouldn't be cut. There are things that likely could be trimmed, but services of advanced education are so very important in this area.

One thing I forgot to mention that I was going to: I believe it's great to do this type of committee work. We all know change is inevitable; it's going to happen. Let's plan for it, and let's manage the change to the betterment of everybody instead of against us.

Highways. There's been a lot of talk about roads and the importance of them in this area — one of the things that there's been a lot of work done on. This summer was a real eye-opener for some people. We have a lot of really bad areas in major roads. In Taylor's position, the Alaska Highway coming into Taylor on the Taylor hill…. No one knows for sure if it's still going to be there when you drive through the next time or whether you're going to fall in a hole. The lesson was brought forward this summer when the Beaton River crossing went. It was pretty hard for a lot of people to imagine that it was a two-to-three-hour drive for the detour to get around the normally 20-minute drive. There are many situations in this part of the country that are that way. When one of our major roads goes, even if it's only for a week or two, it's still devastating to the communities and to the people who normally have to commute on that road. They're very heavily used and very heavily depended upon by industry and business to create wealth and jobs in this area.

Forestry. I would hope — with the dollar signs from the large money made today in oil and gas outstripping all the other industries, in particular forestry, in what they put into the coffers today — that forestry won't get left. My understanding of a great many reports is the fact that for the economy, forestry is far more important and puts far more into the economy of the whole province and even in this area than oil and gas does. Oil and gas puts dollars and cents in from royalties and so on. Forestry employs far more people, far more services. The spinoff from forestry is far larger in the long term and can give us a lot. I think we need to take care of both, but we don't want to lose sight,

because of the dollars that come in today from oil and gas, of the fact that forestry is tremendously important.

I listened with great interest to some of the presentations and some of the questions on value-added forestry. I can speak with a little bit of authority on this. I had a lot of information come to me in the past that I've heard and didn't know too much about, as far as value-added. But for the last couple of months I have been employed by a value-added plant that started up in Taylor. I think value-added is not necessarily taking materials that weren't used for value-added, but they definitely weren't used for it here. It adds the value before it leaves this part of the country and goes somewhere else to add more value. The plant I'm in takes trim blocks from Canfor mills, and we rip them for finger-jointing. We don't do finger-jointing. We ship them off to other finger-jointing plants to keep them busy. They're very short. There's more finger-jointing plants than can be supplied at this time. So it's going to keep them in business in other areas. It is going to employ, once it's fully in force, about 40 or 45 people who were not working before.

You don't have to have a university degree to work in this plant. If you want to work and use your hands and your mind, you can work in these plants. Many people that don't have an education but are very employable in this type of job cannot find a job in these areas, because there are many people with the education and the experience, who have been laid off in other areas, to take the jobs in our area. For the new person in this area, the young people trying to get into these jobs, unless you have an in, it's almost impossible to get into the oil and gas business, these types of businesses. This value-added is very, very important to those kinds of people. They can make a reasonable living, not a huge living like you do in some of the higher-paying oil and gas jobs and these types of things, but it's very important to have these value-added jobs.

The question was asked about OSB. Is that value-added? I don't see how it could ever be classed as value-added. It's taking a tree out of the forest, bringing it into a plant, manufacturing it into a finished product going out. It replaces plywood. I never have heard anything said about plywood being value-added. In my opinion, I don't see how it could ever fit under value-added. It's a manufactured process.

One of the last things I'd like to speak on is that there's been quite a lot of discussion about community services and so on. But when it has been talked about, making sure we've got the services in the urban areas, I've only heard Dawson Creek and Fort St. John mentioned as the urban communities. They are the larger communities, and it's very important for them to be up and feasible, to give the services that are needed, but we don't want to forget that if those two are the urban centres, then the rural areas pretty well match them one for one for population in this region. So it's pretty equally balanced, the people that live in Fort St. John and Dawson Creek and the whole rest of the rural area. When decisions of that type are being made, as far as urban and rural, let's not forget all those rural people who are out there in our areas. I hear that there's nothing really unique in any area because you can go to other places and find things that offset it, but I think one of the unique things in this area is that there is a very large rural population and many of them are very far out from the communities.

That's all I wanted to talk about. Terry did have one thing he'd like to mention.

T. Martens: My name is Terry Martens. I'm the finance director for the district of Taylor. I noticed today that there's an issue that hasn't been discussed terribly much, and that is revenue generation. The provincial government is grappling with the idea of generating new sources of revenue, just as municipalities have been for a while as well. I just would like to make a very small suggestion, perhaps a bit unorthodox, and that is that a mechanism could be put in place where representatives of the provincial government could be working together with municipal officials on a provincewide basis to generate joint sources of revenue. That way, both levels of government can together get additional revenues that are fair to the taxpayers. Maybe this is something that already is planned for the community charter, or perhaps it can be included in the community charter. I just thought that it might be a good idea for all of us to work together rather than as silos, two different levels of government.

F. Jarvis: One other point that I forgot to make is that I'm not sure the things that I talked about are directly reflective to the budget committee, but I think indirectly every one of them is very important.

R. Sultan: I'm intrigued by this idea of extra revenue generation. Can you give me an example of a possibility?

T. Martens: No, I can't at this point, but I'm sure there are several sources of revenue that it could be.

F. Jarvis: We will put stuff down in hard copy and forward it to you. Possibly Terry can think of something that we could put in there too. We'll try to put our points forward and maybe enhance some of them a bit and give them to you in hard copy before the deadline. Thank you for the opportunity.

B. Lekstrom (Chair): Thanks very much for taking the time this afternoon and coming down. We do have time. It is after 1 p.m. We are off to Prince George shortly. We have meetings there beginning at 5 p.m. I know our schedule is very tight. I believe that Linda is here from Peace-Liard Health. We will entertain one more presentation briefly. I apologize for our tight time frames.

L. Nash: Thank you for the open-mike opportunity. I want to, first of all, stress that I am not here as a representative of Peace-Liard Health. I'm a private consultant, and I'm currently under contract to them. I'm actually forgoing a day's income in order to be here to present to you. I am here as an unofficial advocate of mental health consumers.

The areas I'd like to comment on are mental health service delivery, the devolution of acquired brain injury services to the regions and the regionalization process itself. Mental health service delivery, first of all. I commend this government for the development of the Minister of State for Mental Health position. It bodes well. I'm hoping that the proposed increased funding will address some of the regional disparities. Information that's been made available to me indicates that Vancouver-Richmond is funded at $260 per capita per annum for mental health services. Peace-Liard is funded at $90 per capita per annum.

With regard to disability 2 benefits, I've just completed an extensive consultation process with a series of persistently mentally ill in this region. Overwhelmingly, the consensus has been that the clawback of income over the $200 limit for disability 2 benefits is a mechanism that not only interrupts that incremental development of earning capacity but also destroys motivation and initiative. Those are both issues with the seriously and persistently mentally ill.

With regard to the early psychosis identification and intervention program, again, I commend this province for this activity. Unfortunately, psychiatric illness is not something that occurs at age 19. I would encourage this government to look at the issue of child and adolescent mental health, as currently the mandate of the Ministry of Children and Family Development, who take a developmental approach…. Even Canadian research indicates that in order to interrupt the disability, dysfunction and disadvantage that occur with severe mental illness, we have to address the issue early and from a psychiatric approach. Medications are essential. I would encourage you to take a look at where you have child mental health.

With regard to the devolution of acquired brain injury services, one of the interesting points is that the current provincial brain injury program, which is funded at $10.8 million, does not target any funding in the Peace-Liard region. I think we're one of only two regions in the province that don't currently receive any funding. There is no targeted funding from any source for acquired brain injury services in this region at all.

One of the things we've done is develop an intersectoral steering committee, which the draft policy framework that the mental health branch in the Ministry of Health has just put out, that encourages that kind of intersectoral approach. I would also encourage this province's government to take a look at developing some sort of ministerial-level requirements for collaboration, particularly with regards to funding, although that collaboration happens at the community level very readily. Unfortunately, with regards to targeted funding, those community-level agencies often fall back into the boundaries of their very stringent mandates. That collaboration does not become a reality.

Mental health services are currently identified as where those acquired brain injury services will be located. I just wanted to point out, again, the disparity between regions at which mental health services are funded. The policy framework that was put out by the province did not address the issue of funding whatsoever, and in order to proceed with service plan development, we really do need to address that issue.

The issue of family funding for service provision is one of…. I think it was you, Jeff, who introduced that topic. That is really strongly supported by the steering committee. That is intersectoral, because it taps innate motivation and also addresses the family's economic realities.

With regard to regionalization, you probably guessed when I keep talking about this province that I'm new to this province. I've been here six months. I come from Manitoba, which is a have-not province, and I would encourage this government to take a look at the have-not provinces in terms of models of effective, efficient service delivery in health care. One of the interesting things I've found is that the regionalization process has forged ahead in the have-not provinces and has floundered in the have provinces.

With regard to appropriateness of care that reflects the region's demographics, I have found that this region's demographics are really somewhat unique in terms of the population. The economy is resource-based, so we're heavy on the lower end of the population. I come from a rural region in Manitoba where over 20 percent of the population is over the age of 65, and that demographic just doesn't work here. So we're looking at having to have programs like the early psychosis identification and intervention, because incident rates will be higher within this region. It's appropriateness of care as well as effectiveness of care. It supports management by results.

When you're looking at management by results, I would also encourage this government to take a look at things like prevention, particularly in the area of mental health services, where results and outcomes are in terms of dollars not spent.

Isolation can result in the absence of adherence to clinical standards and guidelines. Small facilities rarely seek accreditation, but as part of the regionalization process they do then become involved in accreditation processes, and quality of care tends to improve.

B. Lekstrom (Chair): Thank you. I do have a couple of questions. I will begin with Lorne and go to Brian.

L. Mayencourt: I'll be real quick. It's on the issue of the clawback. Right now it's at 200 bucks. Do you see this as something that would be specific to disability 2 recipients, or do you see it as a broader thing for anyone who is on…?

L. Nash: My experience is in mental health and psychiatry, so I'd have to limit my comments to that. Specific to disability 2 recipients, it's yes.

L. Mayencourt: Do you have some idea of where that clawback might be more just? Is it $400? Is it $350?

L. Nash: I don't think it should be a discrete amount. I think it should be incremental as a person develops their skills and abilities.

B. Kerr: I'm curious as to your comment with regard to why regionalization works in the have-not province but doesn't work in the have province. Do you have any reason why that would be?

L. Nash: I have no idea why that is happening. It's just an observation that I've made. I've been involved with the regionalization process in Manitoba as well as in Saskatchewan, with the population health approach to health planning. I'm quite interested in the fact that the Maritimes, Saskatchewan and Manitoba are where the regionalization processes are the most advanced. Alberta, through its stringent budget-cutting in the nineties, also advanced the regionalization process, but it did so during a time of restraint, not during a period of growth.

J. Bray: Linda, just one quick one. The capital region health district in Victoria has funded a program where they take youth who are having their first psychotic break and actually house them outside of the normal institution framework. I think they have some results that are showing really significant drops in future breaks because of that early intervention. I would encourage you to contact them and then to make a presentation to the Minister of State for Mental Health, because I think that's one of those programs that is results based. It actually shows you. I would just offer that to you, because I think we're taking off pretty quick.

B. Lekstrom (Chair): I will go to Ida and then Ralph, and then we will wrap it up. I'm sure the aircraft is going to be mad at me already.

I. Chong: Thank you, Linda, for your really thoughtful presentation. I just wanted to comment on the fact that you have quite substantial knowledge in this area. For the benefit of yourself and others here, the Select Standing Committee on Health, for the first time, will be touring the province as well. Not that I want to see you take another day off work to do that, but if you wanted to make a presentation, a written submission, to them as well, I think they would be very grateful for what you've provided here to us.

I. Chong: Some places we go to are in the evenings as well, so you may not have to adjust your daytime hours.

R. Sultan: I'd just like to comment on the correlation between the effectiveness of regional government and whether you're a have or a have-not province, and to assure the presenter that based on the trends of the last ten years, we should soon have superb regional government.

B. Lekstrom (Chair): Thank you very much, Linda, for your time. I would like to thank everybody who has come out for taking the time to make presentations. For those who were unable to get to the mikes, I would encourage you to please put forward a written submission. The process is open. We could spend, I'm sure, a day or two in each location, but our intent is to try and cover as much of this province as we can and hear from as many people as we can. Unfortunately, time frames don't allow us to sit and hear everybody in attendance, but we do have a process available so that we can hear your views either through the website or through written submissions that are forwarded to us.

In closing, I would like to thank the members of the Peace River area who came to make presentations. I'm encouraged by the participation that we have here. As the next month goes on, if you hear anything or if you think of something new, please don't hesitate to add something to your already-made presentation. To people who haven't had the opportunity to put feedback into the system yet, please take the time, if you can. Forward us your issues and concerns and ideas, and we will encompass those in our deliberations.

Once again, I thank each and every one of you, and I thank the committee members.

REPORT OF PROCEEDINGS (Hansard)

SELECT STANDING COMMITTEE ON FINANCE AND GOVERNMENT SERVICES

REPORT OF PROCEEDINGS
(Hansard)

SELECT STANDING COMMITTEE ON
FINANCE AND GOVERNMENT SERVICES