Finance and Government Services - Issue No. 11

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

REPORT OF PROCEEDINGS
(Hansard)

SELECT STANDING COMMITTEE ON
FINANCE AND GOVERNMENT SERVICES



CONTENTS

		Page

Presentations		349
	R. Clark	349
	R. Mackie	353
	J. Fowler	356
	J. Harder	358
	M. Gibbons	360
	I. Schierbeck	365
	F. Anderson	365
	G. Edwards	367
	P. Harvey	369
	R. Sahlstrom	372

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:	Frank Anderson Rob Clark Greg Edwards Jo Ann Fowler Marty Gibbons (Shuswap Columbia District Labour Council) Joanne Harder Shelby Harvey (Revelstoke for a Safe Trans-Canada Highway) Robert Mackie Ron Sahlstrom Ian Schierbeck

B. Lekstrom (Chair): Good evening, ladies and gentlemen. I would like to thank you for coming out this evening. My name is Blair Lekstrom. I am the MLA for Peace River South and Chair of the Select Standing Committee on Finance and Government Services.

We are here this evening to hear your input into the prebudget consultation that's taking place throughout 16 communities around British Columbia, as well as accepting written submissions from the people who are unable to attend any of the 16 or who weren't prepared at the time we were there.

Just before we begin, I would like to point out a few things. Everything that's said this evening will be recorded and transcribed by Hansard. With us this evening we have Pat Samson and Amanda Heffelfinger. To my left we have Anne Stokes, our Committee Clerk, and at the back table is Josie Schofield, our research analyst.

We are here this evening to discuss what I think is fairly easy to say are some significant challenges that we face, and we're seeking ideas and input into the priorities British Columbians would like to see in the upcoming budget. Without carrying on too long, I will ask each member of the committee to introduce themselves. Then we will begin with the presentations. Our mandate is to listen and report out by November 15 as to what we have heard travelling around the province. As well, we have to examine the written submissions that are submitted to our committee through the Clerk's office at the Legislature in Victoria.

With that, I will look to my right and begin introductions with Barry. If you'd like to begin, Barry.

B. Kerr: I'm Brian Kerr from Malahat–Juan de Fuca on Vancouver Island. I'm just wondering why nobody wants to sit in the front seats.

K. Krueger: Kevin Krueger from Kamloops–North Thompson. I told Tony it was because folks think this is church.

T. Bhullar (Deputy Chair): I'm Tony Bhullar from Surrey-Newton, and I'm Deputy Chair of this committee.

I. Chong: Good evening. I'm Ida Chong representing the riding of Oak Bay–Gordon Head in the greater Victoria area.

H. Bloy: I'm Harry Bloy from the new riding of Burquitlam in the lower mainland.

B. Lekstrom (Chair): Thank you. We are a select standing committee of the Legislature appointed by the selection committee of the Legislature. We are a multiparty committee. Ms. Joy MacPhail does sit on our committee. She is unable to be with us on occasion, and today is one of those days. I will put forward her apologies. She has attended a number of our meetings, and schedule permitting she is certainly with us on our tour.

I would like to begin with our first presenter this evening, Mr. Rob Clark. Is Rob with us?

R. Clark: Bear with me. I've travelled a bit to be here. That road is a little…. The colours are beautiful, but the trucks are big. I haven't prepared a written submission, but because I predicted I would be quite nervous doing this I've written something at least to get me started.

R. Clark: Thank you for the opportunity to meet with you all this evening. Whenever I have to present information in a structured kind of way, I rely on that journalistic technique, the five Ws — who, what, where, when and why.

I'd like to begin by telling you a little about me. My name is Rob Clark. I come before you as a citizen of the Columbia-Shuswap regional district. I own a home on the north Shuswap, and until quite recently I lived and worked in the Salmon Arm and Chase areas. I'm 48 years old. I'm a parent, a spouse, a volunteer, a consumer, a contributor to charitable causes, and now I'm a resident of Vernon, which I understand you visited earlier today. I relocated to Vernon earlier this year when, having won a competition with the public service, I took up a new position, for me, as a supervisor and team leader of the Vernon Integrated Youth Services office for the Ministry of Children and Family Development. I must emphasize that I'm here as a citizen tonight, but I did want you to know from whence I come. This new job meant a move for me, but because I'm still more attached to the Shuswap area, I chose to

meet with you here in Revelstoke today, as you didn't schedule a meeting for Salmon Arm.

I'm used to moving. My father was transferred frequently in his professional role as a registered industrial accountant and comptroller for a large corporation that had its head office in my hometown, which is London, Ontario. Besides Ontario, I've lived in Newfoundland, Quebec and Manitoba, but upon completing my first degree in 1974 I moved to British Columbia. I've lived all of my adult life here, and I love this province. I've been lucky enough to have travelled through most of it and have lived in four main areas of the province: the lower mainland, central Vancouver Island, the Shuswap and most recently the North Okanagan. When I heard you presenting your ridings, I thought that I've covered some of those areas myself. So that's a bit about the who and the where.

I'd now like to tell you a bit about the what — what I'm about, my beliefs, my values, my vision for this province and its people, and why I decided it was important for me to make the effort to meet all of you tonight. I'm proud to say that I've made my career in the British Columbia public service. I began in 1977 as a probation officer in Surrey and had the privilege of being mentored, as part of my training, by then fellow youth probation officer Gordon Hogg, who I'm sure you all know. Gordie cared about kids then, and I know that now that he's the Minister of Children and Family Development he continues to have caring and compassion for the young people that are served by my office on a daily basis. I know this by listening to what he says on radio interview programs and reading messages that are sent to all MCFD employees with regard to decisions that are being made in the environment that is my workplace.

I am, however, worried about the ability of that ministry to continue to serve, in any meaningful way, the youth that come to my office. These kids have many problems. Some are a risk to themselves, and some are a risk to others. Many are virtually homeless and estranged from family, through no fault of their own. Some of these kids are, to use an old-fashioned term, permanent wards. This means we — you and I, the citizens of B.C. — are their parents.

I understand that it is the business of this committee to seek the public's view on how the government shall develop a fiscal plan for Budget 2002 that is realistic, affordable and measurable. You undertake this consultation based on the recommendations of the fiscal review panel's report of July 23, which I was very pleased to receive after indicating that I was going to speak tonight.

At its core, the fiscal review panel holds the belief that — I'm quoting from the executive summary — "expected multibillion-dollar deficits represent a serious threat to the financial health of the province." I note, however, that in deciding to cut personal and business taxes, the government's action has resulted in the fiscal review panel adjusting its forecast for this year's deficit from $24 million to $1.4 billion. This has led to announcements about across-the-board cuts in ministries of 20, 35 or 50 percent. I can't help but question whether the decision to make that tax cut was realistic and affordable. It does, however, appear to be measurable.

The B.C. fiscal review panel states its belief that — and again I'll quote, but I'll add a little emphasis, which is mine — "arbitrary and disruptive reductions in key services can be avoided if government undertakes a comprehensive review of all of its activities designed to focus on services that yield results as well as improving efficiency of service delivery and overall economic performance."

As one citizen of British Columbia, I don't believe we are able to afford the tax cut. The results of that tax cut, in my opinion, will be deep cuts in social programs. We will pay for that tax cut through unavoidably impacting many of the key services that we deliver at my office. That includes youth justice, child protection, family services and mental health services to young people.

I'm not the accountant my father was, but it seems to me that reducing debt and its inherent cost to service the debt would eventually result in decreased taxes, as the money spent servicing debt was returned to the taxpayer. It might take a while, but it would have helped me to feel more optimistic about the future of the province and its citizens that I serve.

I struggle with the real-life ethical dilemmas that become part of every day when one works, as I do, for one of the big six ministries that are referred to in here, which represent 75 percent of government spending. Don't get me wrong; I don't like higher taxes any more than the next person. I like less, however, attempting to grapple with the moral and ethical dilemma of what I refer to as triage: deciding who is likely to respond to services and who should simply be — I'll use an economic term here — written off at some point in making that decision.

The B.C. fiscal review panel places a lot of emphasis, as has this government, on accountability. Indeed, it's defined in the glossary of the review panel report as the responsibility of a person acting on behalf of another person to report on what is planned to be done and on what the results were. That's the "why" of why I'm here: to speak of the results.

The same glossary of terms defines an asset as a thing that has value over time. When you work with vulnerable children and youth as I do, that definition has special resonance. I ask that you consider that for a moment.

Recently I was told that our ministry is now in the business of protecting the most vulnerable of children and youth, not all vulnerable children and youth. But who decides that? Should we focus our energies on the young person who is open to receiving help but not nearly so vulnerable as the street youth involved in the sex trade, who is very much in your face and engaging in life-threatening behaviours every day? We're now told to measure outcomes versus outputs, but how do you measure such issues with regard to the human beings that are my clients?

The electorate has provided this government with a huge mandate for change, and you, ladies and gentlemen, are the change agents. Just as I am employed to carry out the will of yourselves as the duly elected government, I look to you to provide me with the answers to the questions of who gets service, what that service should be and how it's measured so that the results are in keeping with the goal. We're not talking here about widgets but about young people.

Charles Taylor gave a lecture many years ago that was subsequently published in a little book called The Malaise of Modernity. The book itself makes the argument that modern society has become somewhat lax, sitting back and letting government take care of itself while it enjoys the comforts of being whole and relatively safe. Charles Taylor also makes reference to something called instrumental reasoning. Instrumental reasoning is that sort of cost-benefit analysis that pits things like human life against dollars.

That's a very difficult strategy for me to understand and to operate with on a day-to-day basis, particularly as I've now spent five years in a ministry that was specifically created with an expectation that we would protect all — even though, as my own minister has said, it's not possible. It's good to hear someone admitting that finally. But it is those day-to-day decisions.

If we're going to be choosing, I really don't have an answer to whether we should choose someone, as I gave in the example, who is very entrenched and very much at risk every day — and we have them come to our office — or whether we should look at earlier interventions and not worry about the others.

I'll just conclude by saying that while I appreciate the conviction that has gone into the decision to exercise your discretion as government to bring in a balanced budget and to reduce the deficit, all of these things are policy decisions. I think the world changed considerably on September 11. I do not feel we currently have enough sense of security that we can look at carrying out the fiscal restraint suggested by the current process. That's not to say it doesn't need to be done, but it is to say the timing could be looked at. I'm happy to answer any questions you may have. Thank you for listening.

B. Lekstrom (Chair): Thank you very much, Mr. Clark, for your presentation this evening.

K. Krueger: You started out talking about the five Ws. Rudyard Kipling referred to the six honest serving men that he kept, and they were the five Ws, plus "how."

K. Krueger: How is what you left out. How is what this committee is all about. We're grappling with it. B.C. has been heading down a road to financial disaster for the last ten years, and it is a disaster right now. The debt has more than doubled. The carrying charges on it already are almost $3 billion a year, even though interest rates are at historic lows. That's more money than we can afford, or the previous government could afford, to budget for post-secondary education.

How do we get to where we need to go? You can't go on living beyond your means forever. If income is exceeded by outflow, the upshot is downfall — right? So how to do this? Well, you said reducing debt servicing costs would have been better. That was one "how" that you mentioned, and we agree with that.

We've got to reduce the debt. Before you can even begin to reduce the debt, you've got to eliminate deficits. You have to, because debt is the accumulated deficits. We're facing that problem, along with a whole lot of hidden deficits like roads that haven't been maintained and rehabilitated. They're crumbling when they actually should have been improved. Our economy has suffered dramatically because of all those things.

We care very much — everyone in government does, all 79 MLAs — about the issue you're raising. We're hearing very impassioned presentations from people all over the province who are desperately concerned about what the cutbacks are going to be and how they're going to affect them. We made a commitment before we were elected as government that we wouldn't cut back health care or education budgets. We haven't and we won't.

Now we're hearing voices around the province saying that not adding to them is just as bad as a cutback, because you're effectively freezing them. Inflation is going to take a toll, and the population is changing. You know, we hear all those arguments. We know the issues, but we need lots of input on the how.

You've agreed with the minister, who you quoted as saying that we can't do it all for everybody. But can you give us a little more of an idea in your area of expertise on what is the how? How can you choose the right priorities? Which of those programs that the ministry has been spending money on, and other ministries that you know of, really don't need to be done by government or could be done less expensively outside of government? Any input on those things?

R. Clark: As I say, I'm not a mathematician, and I'm not claiming to be, but $1.4 billion could have gone straight off the bat. I don't know that the people who got the tax break are the clients I deal with. Most of them don't pay taxes.

K. Krueger: Einstein said that the same thinking that got us into this situation we're in won't get us out. We had ten years of increasing taxes and increasing expenditures by government trying to be all things to all people, and this is where it got us. We believe — and we ran on a campaign that said — that the right thing to do is change that and cut people's taxes to encourage them to invest in this province, to stay here, to stop the brain drain and to encourage people to create jobs in British Columbia.

It is a dramatically different direction, but that's why we've cut taxes. Every jurisdiction in North America that has done it has actually experienced an increase in income tax revenue after a fairly short lifetime. You

do generate a larger and more robust private sector economy, so you have more people paying the lower rate and you can afford your social programs better. To continue doing the same, we could only anticipate that we're going to get the same result.

R. Clark: Mr. Krueger, I understand the theory behind what you're saying. I guess that may well be true in other jurisdictions. I can only speak as an individual. As much as I hate to admit to being an average person, I seem to be this average consumer with respect to people reporting. If the economy is in the doldrums and somebody comes along and says, "Oh well, the latest indicator is that things are improving, because people are buying more furniture," guess who went out and bought furniture that month. I seem to be this average person on that score.

I don't feel confident, and I don't feel that I'm going to take that money and invest it here. I want to hold onto that money pretty darn tightly right now. I am saying that this is a different period of time. Perhaps three months ago I wouldn't have had such a strong feeling about it, but I just do have that feeling now.

I've worked in the social service field for 25 years, but the mood of people at this point in time — the despair — is quite remarkable to me. It's not simply those that are my clients. It's my colleagues; it's people on the street. I don't know. Nobody could have predicted September 11 and the impact that's had.

This document does talk about consultation, and it does talk about the importance of considered decision-making. I'm simply asking this committee to consider whether it has to be locked into the timetable that has been set. Though the process may be very important, perhaps the timetable isn't as important.

This is a time, I think, that people need to know that a stronger central government is supporting them, because people don't feel secure. With that lack of security, in my estimation, comes a lack of confidence, and that's not going to turn the economy around at the moment. Some of these actions will, I think, have even more of a compounding effect in the same way that the debt interest compounds and creates that problem. This could spin us into something different. I'm not an economist. It's just my feeling as an individual. I don't feel confident. I don't want to go out and spend anything. I'm not buying any furniture.

T. Bhullar (Deputy Chair): You touched on September 11 a fair bit. Can you articulate exactly how you feel it's changed the economy not for the Americans but for us?

R. Clark: In terms of the economy itself, our largest trading partner is the United States. We now have a border that is much more difficult to conduct business across. The Premier spoke, I understand from the news today, on that very issue to Mr. Manley or the Prime Minister — somebody in Ottawa, somebody back east. That's one issue.

The other thing — I find this really strange, and it's always been something that's really bothered me — is that sometimes the economy is measured by gross domestic product. That's defined in here. Disasters increase gross domestic product. I mean, suddenly no one flies, and the airlines are in terrible shape, but emergency services are doing well. The caterers who feed them are probably doing quite well.

What I'm talking about, though, is that sense of confidence that I think affects the economy. Do people want to fly? Do people want to travel? People say tourism may do very well in British Columbia because everyone will take a driving holiday, and they won't go very far, and the Americans may feel safer coming to Canada. That may be, but that's one sector. I just think that people — and I go back to Taylor's notion of the malaise of modernity — feel most secure at home. The boomers, which I'm part of, are in that place where we go home and shut the curtains. I have found it very difficult, the last four weeks, to even be part of the world, to turn on the news and be inundated and inundated. This is not somebody who's going to go out and stimulate the economy.

B. Lekstrom (Chair): Mr. Clark, I want to thank you for your presentation. If over the next week or two you have the ability to put something down in writing after hearing what's said and contemplating the financial picture we're in, in British Columbia, I would encourage you to do that as well. We do have your presentation, and it will be transcribed.

The one issue we do face with the tax cut issue…. If that was set aside tomorrow, we would still be facing a $3.8 billion deficit by 2004. There are issues we have to grapple with, and I would certainly encourage you to put some thought into that. If you have some ideas that do come forward, I would encourage you to forward those to us as well.

R. Clark: If I can make one final comment, the thought that comes to my mind is that notion — and, again, for me it's historic — of pulling together in a direction. A tax cut over here and then taking back services over here seems to be an opposite pull. If we are looking at, "Let's tackle the deficit; let's tackle the debt," then we're pulling in that direction simultaneously for the purpose of a greater sense of security and control over our own environment and our capacity to be less dependent on others. That makes sense to me.

B. Lekstrom (Chair): I believe you're correct. We all want to get to the same end point, and that's a better society to live in, in British Columbia and one that we can sustain. How we get there is the balance that we have to come up with. I thank you, again, Rob, for your presentation.

R. Clark: Thank you, Mr. Lekstrom, and thank you, committee. Enjoy the rest of your travels.

B. Lekstrom (Chair): Our next presenter this evening is Robert Mackie. Good evening, Robert.

R. Mackie: Hello. I certainly didn't expect the formality that I'm welcomed with here. My name is Bob Mackie. I'm currently employed, and have been for almost the last 30 years, as a locomotive engineer with CPR, mainly here in Revelstoke. I graduated from UBC with a degree in political science and sociology in 1971, and I've always tried to keep pace as much as I could with such subjects as political economy.

I wasn't planning on attending this session with the idea of making a presentation so much as maybe witnessing from a spectator's position what transpired in our community. I believe in community focus on things to do with economics specifically. Maybe now I should bring in my major reference, because this is what made my mind up to come today. The appointment of the Nobel prize for economics on October 10…. One of the three co-recipients was a fellow by the name of Joe Stiglitz, who's a professor who's probably worn a mortar board in every major university in the United States ever since he got out of post-graduate school. He no sooner accepted his Nobel prize than he turned around and addressed George W. Bush's much ballyhooed, huge tax rebate and tax cut. I believe it was something like $1.4 trillion in the first half of 2001. I don't have that figure with me. I know it's well over a trillion dollars.

This is a quote from the Washington Post, Thursday, October 11: "Wading into the current debate about how to stimulate U.S. economic growth, Stiglitz yesterday criticized President Bush's tax cut, saying it was not boosting the economy, because taxpayers are spending only about one dollar out of every five dollars they have received in advance refund cheques." It goes on to say in this article: "'The Bush tax cut wasn't designed as a stimulus measure but to take spending flexibility away from Congress,' Stiglitz said at a news conference. 'I would argue that it's counterproductive in many ways.'"

There are a lot more quotes I could bring into this, but I'll try and use those quotes in the perspective of what I see as wasted energy with this $1.4 billion personal tax cut that we've seen in the first part of the administration of the Campbell government. What I see, of course, is that it's not difficult to realize that the flow of money dictates the direction of wealth, and there is no wealth invented or created; it's transformed. If wealth is used to capitalize markets, whether they're supply or demand, that wealth is usually brought from some other sector. It's not created in one place unless, of course, we undergo what we did back in the early eighties with massive high inflation rates, which would fuel lots of very shallow bank accounts. We certainly saw the collapse of the savings and loans in the United States over that.

A good reflection of the performance of the economy would probably be how the debt and deficit relate to each individual taxpayer and citizen of the province or even in the community. Unfortunately, I can't bring it down to that level. But I do understand, from figures I've seen from the Ministry of Finance in previous years, that B.C. actually has one of the lowest debt-per-taxpayer ratios in Canada. In my mind, if there were going to be a reserve of debt in tough times, when perhaps more Keynesian attitudes would prevail, we could draw on that reserve. As we've already heard this evening, if and when the economy is brought back to its feet through outside forces more than anything else — the export and international trade sectors — then those debts could be serviced. Sure, they'd be debts, and we'd be in debt. But we might have, for the cost of…. Well, a $2 billion tax cut would be — what? — four Vancouver conference centres and I don't know how many mobile MRI machines. It would certainly make no difference to me. I make a fairly healthy wage with the railway.

I've noticed that the higher your income is, the higher the ratio of tax refund is under the current Campbell regime. That doesn't make sense to me. I don't think this is a time for cutting taxes. Perhaps the revenues could be shifted to more capital expenditure, like rejuvenating the Trans-Canada Highway, for instance, or maybe sending out another offshoot of the British Columbia Railway so that people who are constrained by highway transportation modes only could perhaps catch a train rather than having to rely on a bus that might be blocked by an avalanche. I know that story very well. I'm not going to digress.

In a nutshell, I do think that an indicator of the health of the provincial economy, in this case, would be bankruptcy statistics. I've got them here — comparative, from British Columbia right through to Ontario for the year 2000. These were garnered by myself from one of the federal government websites that sends this stuff out.

In B.C. last year there were 980 business bankruptcies recorded. In Alberta, on the other hand, which has had all kinds of tax cuts over the years and reductions in services — where, of course, these tax cuts should be spent in private services rather than on government services — there were 1,710. What's the population ratio? I believe they're about 65 percent of the B.C. population. Next door to that is Saskatchewan: 438. Well, they're certainly not following the trend. Then you go next door to Manitoba: 253. Then all of a sudden in Ontario it's darn near 3,000 — 2,928.

Those people were challenged by the dream of being able to garner this…. The people that wound up bankrupt were the people who thought they could catch a dream and catch some of the revenue that returned to taxpayers. The taxpayers weren't biting. They were saving, because they knew they'd have to save for future years when they'd retire and for services like Pharmacare when it would be cut and they'd have to dig into their own pockets from the revenues that they could probably put away. Or they paid down their Visa bills or whatever. But it certainly wasn't going to the small business operator. The small business bankruptcy rates in these provinces are probably a better indicator than a lot of things, than the gross amount of dollars, which might be what Professor Stiglitz calls

asymmetrical information. In other words, the people who know what that information is about have control of where that information is used. For the consumers in the crowd, it's big zeros — lots of zeros. Anyway, that's it. Thank you.

B. Lekstrom (Chair): Bob, I'd like to thank you for coming out this evening. I'll look to members of our committee if there are any questions.

K. Krueger: Thank you for your perspective, Mr. Mackie. It was really well presented and a really interesting perspective. You commented that B.C. has one of the lowest debt-to-taxpayer ratios in Canada, and that is a happy inheritance from W.A.C. Bennett, who left us in good shape when he left.

K. Krueger: We haven't done that well since. That's right. For the last ten years we had a government that, as you put it, drew on that reserve, but they didn't do it in the tough times; they did it in the boom times. The rest of North America was experiencing an unprecedented economic boom throughout the 1990s. We went from the best-performing economy in Canada to the worst-performing economy in Canada. That is really sad, because it did put us behind the eight ball now that there is a North American downturn and a recession. The average British Columbia take-home pay dropped $1,738 in the ten years that the NDP were in power, so people have that much less money in their pocket, let alone the effect of inflation over those ten years.

We're a government that was elected on a promise to do what we've done — dramatically cut people's personal income taxes — because we believe that's the only way we can restore British Columbia's economy. Capital is much more mobile, as you know full well, in the year 2001 than it was in the past. Investors can invest their money wherever they choose, and they've plainly shown us that they won't invest it here with the taxes at the level that they were.

You spoke of Alberta's economy — a million fewer people and a larger economy than British Columbia.

K. Krueger: Well, nevertheless, you go to Alberta, and there are help-wanted signs everywhere. That economy is booming. We have to do something different than what was done for the last ten years. So what do you advocate?

I just want to mention this to you. I had a railroader say to me before the election that he and six buddies who were also railroaders had made a pact that no matter where they were when the election was called, if they had to take a cab all the way back to B.C., they would — to make sure they voted for our tax-cut platform, because their colleagues in Alberta were taking home $400 a month more than them for the very same job.

The gentleman before you said that he didn't believe that money was going to be spent in the economy, that people are going to squirrel it away. Maybe they will for a while. Nevertheless, we promised we'd do it. It's very clear to us, and I'm sure it is to you, that the approach over the last ten years, if we duplicated it now, would not give us any better results than what the NDP had. So what do you suggest that government should be doing instead?

B. Mackie: Capital expenditure. Go into debt to do it. Renege on your promise on the tax cut. As far as efficiencies go, I believe that even before the administration changed, social services had already been trimmed back to the bone. I can't see social services being trimmed back any. I understand there's supposed to be what amounts to a 35 percent cut in all the ministries except for Health and Education. With those being frozen, of course, they're going to wind up not being funded according to the levels achieved at the end of last year.

Being a Keynesian, I would say we should borrow the money and build infrastructure. We should provide decent-paying jobs, stability in the workforce and maybe wider access to education, specifically information technology. We should improve and enhance our transportation system and find other ways of using wood, seeing as how the Americans have a death grip on our market, and the Japanese being one of the reasons that…. I seem to remember that the collapse of the Asia-Pacific market had a lot to do with the health of the B.C. export economy in the mid-nineties, near the end of it, and of course the decline in demand for B.C. softwood products.

A lot of the key issues that drive our economy in this province are not really under our control. I don't think that refunding tax money that's meant to keep this province strong and vital in terms of social support is going to make any difference in the long run. I can't see that money being spent. I can only see bankruptcies going up in this province. If Alberta and Ontario are any indication of what happens to tax refunds, if Professor Stiglitz — who has all kinds of letters behind his name — says so, I'm inclined to believe that. I'm not inclined to believe political economists who seem to think that they can pay off people, go on and spin out business from what used to be public service. That's it; we disagree.

B. Lekstrom (Chair): There are a couple of other questions, Bob, if you would answer them.

T. Bhullar (Deputy Chair): Just a quick question, Mr. Mackie. You're saying to renege on an election promise that the government made to the people of British Columbia, which they were elected on in an overwhelming majority of 77 seats, for a tax cut.

B. Penner: Thanks, Mr. Mackie. We share some similar background. My first university degree was also in political science as well as economics. I'm very interested in your view of political economy.

A point of clarification, first, on health and education. The Minister of Finance said last week that he's instructed the departments to prepare, in the worst-case scenario, for the possibility of capping health and education expenditures for the next three years. If the economy grows, that won't be necessary, but he felt that it was prudent to prepare for the worst-case scenario — which is also what we campaigned on, which is protecting health care and education funding and then increasing it as the economy grew. That was the direction.

B. Penner: The second point is on bankruptcies. Most economists will tell you that you'll see a greater incidence of bankruptcies in businesses where you have people venturing into the economy and attempting to start up new businesses. It's in a stagnant economy where people have given up hope of attempting to become entrepreneurs and have learned risk avoidance. People don't start businesses, and you don't see those failures. Not all businesses succeed, but I would suggest to you that a strong argument could be made that the number of bankruptcies in British Columbia has declined because people have given up trying to have a hand in business. We're trying to turn that around.

R. Mackie: It would be interesting to see if we could measure the difference in the concepts on that.

L. Mayencourt: First off, a comment. Last year in British Columbia we had 7,300 people go bankrupt — that's individuals — which is a pretty important figure, versus businesses going bankrupt. Some of those people, if they had some money to put into their Visa bill or what have you, would be in better shape.

My question is this. I'm looking at construction in this area. Back in '95 in Revelstoke, there were almost $10 million worth of building permits issued. In other words, businesses were building. Last year it was $4.9 million. What's happening here that's having businesses not build? Why aren't people investing in Revelstoke?

R. Mackie: I suppose there are market limits. Features that would make for a more robust economy in this area haven't yet been discovered. Certainly, the community has wrestled with those problems ever since I can remember, watching council and the chamber work and the business development centre here in town. There have certainly been some capital projects that have downsized in terms of government services and of course the railways, logging and these different industries. They have to be replaced. I think we're at the cusp of one and leading into another right now. There is probably a saturation of demand for capitalization in the old economy, as I might call it, as we're heading into the new one, wherever that leads us. I hope we find one. I'm not the best person in the crowd here tonight to answer that question in a really rational way. I'd suppose you're looking for that. Those are my opinions, anyway.

L. Mayencourt: If you can come up with one. The key to all this is if you can get your economy going, then you'll have…. I mean, most people here are earning $25,000 a year. That's not a lot of money.

R. Mackie: Well, that money will have to come from somewhere else. It's not going to be coming from B.C. I've already said that.

B. Lekstrom (Chair): If you have time — and we do — Ms. Chong has one following question.

I. Chong: I was intrigued by your comments when you were talking about wage rates. Just for clarification. This will help us, because part of our consultation is to find out what people believe government should be providing. Your comments were that you felt that government should be providing good family-supporting wages. That's what I heard you say earlier.

I. Chong: What I'm trying to determine is: do you feel that is government's role versus a private sector setting salaries which are based on demand and market? That certainly is something I haven't heard in the last few communities we've toured around.

R. Mackie: Well, from the Keynesian perspective I would say that if government is to try to be the major trend-setter in sustaining what we already have, if we can, through tough times, then they'll have to lead the way. That would be through tax revenue or borrowing — yes.

I. Chong: You're saying that if government is to be the trend-setter, not that government should be. Or are you saying that government should be?

B. Lekstrom (Chair): Bob, I'd like to thank you for taking the time to come out and give us your perspective. That's really what these hearings are all about: to hear from all British Columbians. So I thank you very much.

B. Lekstrom (Chair): Our next presenter this evening is Jo Ann Fowler. Is Jo Ann with us? Good evening.

J. Fowler: I'm going to read my presentation, because I'm like many in the audience who are nervous. So I will begin. Good evening, Mr. Chairman and committee members. Thank you for coming to Revelstoke this evening to give the public the opportunity to appear before elected government officials to present our issues regarding finance and government services. I'm here to speak to you about children, families and our communities and government social support services to the citizens of British Columbia.

I am a survivor of the Gove inquiry. The Gove inquiry was initiated to investigate the tragic death of a five-year-old child, Matthew Vaudreuil. The Gove inquiry took two years to complete and dramatically changed the face of child welfare practice. I was involved with Matthew's mother, Verna Vaudreuil, when she was a child under the ministry's care. I will speak further to this topic, but first allow me to introduce myself.

My name is Jo Ann Fowler. I've had the privilege to have lived in British Columbia all my life. In fact, Mr. Chairperson, you and I are from the same community, and now I have to add Mr. Krueger. I was born and raised in Dawson Creek. I just can't get over how small this world is. I must say how proud I am that you guys are…. I don't think like you, but I'm glad you're MLAs.

I do miss the wide sky of the Peace River country. I have lived in six communities, and I have worked in five different communities, one being an aboriginal community. My family and I now live in Ashton Creek, which is in the North Okanagan. I have worked in the Salmon Arm area for the past 14 years.

I am a parent of two busy boys, a member of the parents advisory committee for my boys' elementary school and area rep for the district parents advisory committee, and I sit on the executive for a community resource society in Enderby. I have worked with children and families from various populations for over 20 years, providing intervention and support and being an advocate. I am perhaps in a unique position of seeing events from the perspective of a parent and a volunteer as well as a professional.

The Gove inquiry made recommendations to the government of the day. Some of the recommendations were to provide staff training, ensure adequate staffing levels and improve technological resources. The Liberals, who were in opposition at that time, insisted that the government should implement the recommendations regardless of cost to government. The government cannot condone the loss of an innocent child's life because of cost cutting. Now the Liberals are looking to the community for solutions to social issues.

People can and do rally to support one another and others who have experienced a tragedy or a loss. Communities can and do support recreational and social events, supporting day care for our young people to senior citizens events. When a family loses their house and belongings in a fire, people are quick to rally to their aid. However, to expect communities to support and address more complex issues such as sexual abuse, incest, physical abuse and emotional abuse is unrealistic. These issues are repugnant to the general public. That is why government needs trained professional personnel, resources and adequate interventions to provide a way to support dysfunctional families and to break the cycle of abuse.

When events are social norms, the community can rally, but when a behaviour is contrary to society's values, people are paralyzed and more likely to respond by ostracizing the family. Communities don't rally around the 15-year-old sex offender, the 13-year-old prostitute, the crack-addicted mother with two children. They don't take casseroles to the dysfunctional family, only to the family which has had an honourable misfortune — surgery, accident, illness. I need to ask you: how would you respond to your neighbour who sexually abuses his young daughter or his son?

With these families on the fringe of society, research has demonstrated that early intervention offers the best prognosis to the most valuable members of our society: our children. For example, Dr. Asante, a nationally acclaimed fetal alcohol syndrome expert, states that it costs approximately $5 million to support an FAS child over the child's lifetime. FAS and FAE are totally preventable. Community support programs such as Healthiest Babies, public health nurses and trained early intervention workers can save millions with just one child. Isn't that a cost savings?

I work with youth that are struggling or are troubled, often through no fault of their own. They're victims of horrendous circumstances. It is interesting to note that what I've found in working with these youth is that the majority only need a little help to progress through a difficult stage in their lives and to help them overcome some challenges. These youth can become totally independent of the system and eventually become contributing members of our society. Once again, a little goes a long way.

We cannot forget that government has a legal obligation under legislation to protect our children. The state's role as a guardian needs to be addressed in many ways. We all know that the state is not an ideal substitute for a parent. In some cases, it's the only viable alternative. Hopefully, someday we will fulfil every child's right to grow up with a family.

Budget restraints prolong the time a child has to remain in care. Currently, it costs the government

thousands of dollars to keep a child in care. There are two ways to save money: (1) return the child to a safe environment in a timely manner, and (2) provide prevention and support services to families to circumvent the child's coming into care. Clearly, the savings are actualized by providing prevention programs and supportive services rather than cutting budgets. The reality is that cutting essential provincial services is shortsighted and costly. By law we have to protect children. To not intercede when children are at risk is financially and socially irresponsible. It is criminal and culpable; to wit many lawsuits that are arising because of past government actions — for example, residential schools, orphanages, etc.

History does not need to repeat itself; we need to learn from the Gove inquiry in the death of a child. We can continue to progress in helping and supporting children, families and communities and be financially responsible as well.

I would like to make the following recommendations for your consideration. Contemporary research has demonstrated that when lawmakers implement good legislation from which flows good policies, social workers can then do meaningful work. There will be accountability and measurable and positive outcomes. As members of the Legislature you have the responsibility to create good legislation with compassion for humanity and with the utmost respect to the needs of children and families.

Conduct a comprehensive internal review of Ministry of Children and Family Development services and programs to identify if there are areas where cost savings can be implemented without seriously impacting essential services.

Ensure appropriate training is available to all workers. Provide technological resources essential to child protection and support services. Ensure that there is a universality of availability of services to all communities in this province.

Finally I need to ask you why protection and services to children and families are being included in the budget cuts and not excluded like health and education. Thank you for your time and attention.

B. Lekstrom (Chair): Thank you very much, Jo Ann, for your presentation this evening.

J. Bray: Jo Ann, that was an excellent presentation, and I appreciate the perspective you're coming from. I worked for 13 years with the Ministry of Human Resources. While I was on the income assistance side, I worked very collegially with community services and with child protection and family service workers.

I'm wondering if I can ask you a couple of questions, because you have experience in the field, and also from a smaller community perspective. I've certainly heard a lot from people about the pre-Gove and post-Gove world, particularly with respect to apprehensions — the number of children in care that seemed to happen after Gove was finished. Of course, apprehension is very expensive in terms of dollars but also emotionally for everybody involved. You may not be able to answer this, but my first question is: do you think there may have been an overreaction or a pendulum swinging too far into apprehend first and more thoroughly investigate or provide services afterwards, after Gove? In other words, in hindsight maybe more apprehensions occurred than should have. Do you find that in your work? Have you got a sense of that?

J. Fowler: To be honest with you, it's difficult for me to answer. What I can say is that the legislation changed to "that the children's well-being will be paramount." From legislation flows policy, and from policy flows workers' practice. Yes, there was an increase in that, and I'm not sure why.

J. Bray: Okay. Certainly, one of the things we heard was that social workers were getting very confusing directions. What I heard was: "Am I here as a family services worker, or am I a child protection worker?" I think you've hit a number of points, which are that from legislation comes good policy and comes good direction for front-line workers. I think that for a whole bunch of reasons, front-line workers were getting mixed signals from various groups. Your recommendation for an internal review is probably very timely.

You mentioned universality of access to programs for communities. Another interesting thing we've heard on this tour when we talked to social service providers is that a community provider would have several contracts from several different ministries to provide services, and they all had a cost just to administer the contract and fill out the paperwork.

Then there were several community service providers within that community who all had multiple contracts to provide services — some from the Ministry of Children and Family Development, some from the Ministry of Human Resources. There seemed to be an awful lot of contracts in sometimes fairly small communities that all had costs and had nothing to do with actually providing a service.

Do you think that especially in rural communities, in trying to increase the access to services, there may be some ability to provide more core funding to communities? They then could take the funding to meet the needs that may change within a year — if there are more street youth in the summer, if there's more domestic violence because of a downturn in the economy. Could the communities use the money more freely to meet the needs as they emerge, rather than having all these little silos of contracts? You must provide service A, and that's all you can do, even if service B needs more. In other words, instead of Revelstoke having 25 contracts from government, maybe Revelstoke gets one or two and then uses the money to meet its own unique needs and to ensure that the services are there.

J. Fowler: To respond to that statement, I need to say that my intent in saying there have to be services available to all areas of provinces was that it's very clear, when you're government, that you need to not have a have-not region and a have region. I think you

have to be very sensitive to that. I ask you for caution when you make decisions and to look at that.

As regards contracting, I believe the ministry has become more sophisticated in managing budgets and has now developed the ability to float from one budget to another budget to meet the need of the community.

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

L. Mayencourt: We're going through this core review process, which is exactly what you suggested would be a good idea to do with the families, and we're doing that. All we're doing is listening, and we're asking people for their priorities. I really appreciate what you had to say, which is that early intervention and child protection services and all that are very, very important, and it pays off in the long run. I just wanted to say that I got your message.

L. Mayencourt: I think our committee did as well. We'll take that back, and it'll be incorporated into what we report out.

B. Lekstrom (Chair): Seeing no further questions, Jo Ann, I would like to thank you for coming out this evening. It certainly is a small world.

We will move on to our next presenter this evening, Joanne Harder. Is Joanne here?

J. Harder: Did you know there were going to be three Joannes tonight? One can't make it. I'm not used to having another Joanne as competition or working with a Joanne or anything like that, so this is unusual. But we're sure good people. All the Joannes I've ever met are really good people.

J. Harder: Good evening. I'm Joanne Harder. I'm speaking for myself, family, friends and co-workers. My husband and I have five children, of whom we are very proud. There's a nurse, a store manager, a paramedic and professional caver, a police officer and a contractor. We also have five beautiful grandchildren.

My husband is retired, but now he works for no pay. Actually, our son-in-law has nicknamed him Mr. Volunteer. If he retires from one council, he gets onto another one. As a family, we all enjoy the outdoors and everything that B.C. offers — hiking, biking, camping, sailing, swimming, skiing, climbing, caving. There must be more.

I've been employed by the provincial government since 1982, by the federal government before that as a bilingual admin assistant at Kent maximum security institution and at Alcan in Quebec as a bilingual secretary. Like many British Columbians I have lived in other parts of the country: Saskatchewan, Manitoba and Quebec. We've chosen British Columbia for our home. Like most working-class people, my income is needed to maintain a decent standard of living. Some of my friends work two and three jobs in order to pay the bills. That's in a two-income family. For the single-parent families, I just can't imagine how they survive.

I've seen the benefits of belonging to a union. I think the phrase, if I have it right, is what we want for ourselves, we desire for all; or what we desire for ourselves, we want for all — whichever. That seems really true today. Privatized work keeps the major profits for those at the top, and then the workers are often back to minimum wages. That starts the cycle of decline for families, when the parents have to work more than one job to keep the family together.

My office was hit hard in 1997 and lost seven positions. One person retired, one was retrained, and the others all went elsewhere, but it was quite devastating for them personally. Our office suffered too. We still needed the services that these people provided, so we got them from the private sector. We paid more for them, and sometimes they weren't exactly what we needed, and they had to do them again. They often weren't on time. That didn't benefit us at all. Those cuts didn't help our office. Then the additional workload made things more stressful for those remaining.

In Quebec I also saw what a union could do. In the early to mid-seventies, boy, the unions were really fighting in Quebec — all kinds of unions. Alcan, which was in Arvida — it's now called Jonquire — was just an isolated production plant with a strong union presence. It was very important to the North American industry. My position was excluded from the union, but I was given all the benefits the union managed to achieve — even pay equity. I didn't really know what pay equity was in 1974, so I was pretty surprised and very pleased.

Our office hired a receptionist, a young girl just out of high school, and she was thrilled to have the job. She said her mother was a high school teacher who taught classes all day, supervised children during breaks and lunch hours, took home all her class work and spent about three hours each night preparing for the next day. This girl was making more money as a receptionist for Alcan than her mother was as a high school teacher with all the responsibilities and evening work.

There was no union of teachers, but they decided to go on strike. They were off for two months, and then an agreement was reached. The parents were very upset. They were dismayed by the teachers' actions, but I really felt that they had the right to strike. They should be paid more for their work than a green student right out of high school with no skills. Basic typing, I guess, was what she had.

I attended the presentations to this committee in Kamloops on October 2. At that time, like some people here, I was a little surprised. We didn't really know how things would be arranged for the evening or whether people could just come up to the mike and talk or anything, and it seemed quite formal. I thought I knew what type of arguments you wanted to hear, but I was wrong.

I guess you know that our medicare and Pharmacare are vitally important to all of us, that education is essential to our future workforce, that we believe government should use our taxes to provide basic safety in every aspect of our province — safety on the roads, protection for our children, safety on our city streets, justice in our courts and rehabilitation programs for those who run afoul of the law. But from your questions and comments, I realized that you wanted suggestions for cutting costs and ways to streamline some programs.

We all agree that this is necessary. However, the extent of cuts and the timing will be crucial right now. Presumably, all governments have pondered the effects on their citizens of the bombings on September 11 in America. The world has changed. The massive layoffs at Boeing, Air Canada, Western Star — and I've just heard ICBC…. There is going to be a lot. There are more that are still coming, of course. They've left us vulnerable. Massive cuts to government spending right now and then employee layoffs would take us to the brink of disaster.

Your plan has been to accomplish these cuts, whatever the final figure is — and I have heard anywhere from 10 to 50 percent — in three years. Please reconsider, in view of the world situation, extending your plan to cover six years.

Our workforce is aging rapidly, and we can lose many over the next few years to retirement and attrition without devastating effects on personal situations, family life, and the vital operations and services we rely on. The employees who know that the cuts are still coming might be tuning into that and maybe doing their retiring and looking to other jobs to get out, if you're trying to cut employees.

Extending the cuts over a six-year period would show compassion and understanding and give everyone a better chance to plan for the future. Younger people going through the education system right now would have a better idea of what the workforce may look like when they graduate.

The waste-buster site was a good idea. It's being used by many of my friends and co-workers. The details of the economies you're looking for will be found there, over time, if you scrutinize the submissions carefully and then discuss the changes and consequences with those involved in the programs. Our economy really needs help now, not massive cuts to spending and elimination of jobs. So please reconsider carefully the time line for spending cuts, and let us, the public, help you make economies thoughtfully and considerately.

B. Lekstrom (Chair): Well, I didn't…. Yes, I knew somebody would take that out of context. [Laughter.] Your left.

B. Penner: Thank you, Ms. Harder. I thought it was a very good presentation and I think many of your suggestions are very thoughtful. I just have one question for you, and that's pertaining to the waste-buster website. Are you and your colleagues finding that you're getting a response back after you make a suggestion? If so, what kind of response are you getting?

B. Penner: When the website was announced, I believe there was a commitment from the minister in charge that there would be follow-up and that people would get a timely response. I'm just curious to find out.

J. Harder: Maybe a lot of people are not telling me. Maybe a lot of people don't feel comfortable telling me; some people do. I haven't heard of responses yet.

J. Bray: It's interesting. I know we're sort of in an unusual time, because historically governments — it doesn't matter what party — have told you: "This is what the situation was, so this is why we're justifying the decisions we've made." I think what the Minister of Finance is at least saying is: "Here's what we're facing, and here's the way we think we should go." It allows for more dialogue.

One of the interesting things was when we were in Kamloops, actually. You may remember the gentleman — I think it was Kamloops; it might have been another town — who worked in my old ministry of Human Resources and who was actually able to demonstrate that they have 120 people working in the information technology area. They, as you say, contract out or outsource permanently for another 80 people. He was able to demonstrate, using his calculations, that if they actually hired those people, the ministry would save $7 million.

When we're looking for reductions of expenditures, we're not necessarily saying it's the employees that are the cause. There may be lots of big-scale efficiencies that may have limited impact on jobs or even the reverse. I would encourage you, as you go back and talk

with your colleagues, to really think outside the box. Here was somebody who came in front of this committee and actually said: "I can save you money by hiring more people." That was a great suggestion that we forwarded on to the minister.

We're looking for really creative suggestions that are outside the box and are different from anything before. They will all go to forming our report. I encourage you to go back to your co-workers and even your own family. There's a real wealth of experience in your own family that may come up with something that is one small piece.

J. Harder: I do think that as we go up the ladder — our managers and directors and up and up we go to the level where they actually work from the bottom up — those people know some of the programs that we've expanded on. Maybe they can look at: where was the core, and what do we need? Not from my level, but I do think they'll be preparing the figures, the budgets, with those different percents.

I. Chong: I want to commend you, Ms. Harder, for your presentation. It was actually very thoughtful and had a concluding remark about making economies thoughtfully and considerately. That is what we are trying to do: find the economies — not, as the perception is out there, cut for the sake of cutting. We are looking to find where savings can be found and, if necessary, redirect that to each patient's purse, student's purse and social service requirement's purse. One of our questions in the budget consultation document was about determining those programs or services which could be restructured, expanded or terminated.

I was looking at your presentation, and you mention that your office was hard hit in 1997. You lost seven positions. I'm wondering, first of all, if you are comfortable sharing with us what kind of work you were involved with. It isn't clear from what I can see here. Secondly, if something like that were to occur, would you tell us, the committee — or just send it in to the waste-buster website — how to avoid that so that there would not be an additional cost? We are looking to ensure that programs, if they're restructured, will result in savings and more efficiency.

J. Harder: I think those cuts were done too indiscriminately or too quickly or something. It was a service that we'd always done. I'm in a Highways office. We're the basic resource office, so we need very accurate maps. Our survey people left. We didn't have any anymore. Our people know exactly what we need. They just go out. They know what we need, they do the surveys, they come back, they do the mapping, and everything is up to date.

That's kind of fallen by the wayside now. We'll probably have to do a big contract to bring it all up to date. When we did ask for services, they often didn't quite understand what we needed. Maybe we weren't used to phrasing it properly.

I. Chong: So you're saying that it cost your office or the branch that you worked under more money when that happened.

I. Chong: Does someone have that information, which they could, even as an example, send to our waste-buster website as a precaution not to go down that road again?

I. Chong: Well, it just would be helpful. These are the kinds of stories we do want to hear, as we're touring the province, from individuals or front-line workers. We are hearing from a lot of people who work in the civil service as we're touring. If they have those examples, we certainly do want to hear from them. As some programs will be restructured, we are looking to you to help us find savings and more efficiency. So it would be helpful if somebody had that information.

J. Harder: Some of them, like I say, were let go, and some of the duties that were vital were just sort of given, here and there, to different people. It was distributed. That's always a possibility, too, if you can.

B. Lekstrom (Chair): I see no further questions, Ms. Harder. I would like to thank you for your presentation as well. I can assure you that the job before government is a challenge, but there will certainly be compassion in the discussions that come forward over the coming months as far as the development of our budget. Balance is the key to something that we've been entrusted by the people of British Columbia to bring. We will do our best.

Our next presenter this evening is with the Shuswap Columbia District Labour Council: Marty Gibbons. Good evening, Marty.

M. Gibbons: Hi. I'm Marty Gibbons. I am 26 years old. I'm the president of the Shuswap Columbia Labour Council, and I'm also a millworker out of Salmon Arm. None of you seem to be my….

M. Gibbons: Yeah, George Abbott. He seems to be absent, unfortunately. I'm also a father and a happily married man.

The reason I bring up my age is that I'm 26 years old, so I have 29 years left in the workforce, 29 years left of paying taxes, 29 years before I retire. There's a number of reasons why I could have brought that up. I

guess we'll hit on those later in my little update here. The reason I bring up that I'm a millworker is the fact that I have no problem being an average British Columbian. I actually enjoy being an average British Columbian. I like being the average Joe, the average taxpayer. Two kids, family, house, dog — you name it. I'm as average as you can get. The reason I bring up my children is because I feel I have an investment in the future of this province. I feel that not being involved is basically leaving my children open to the future.

I'd like to talk on the tax cuts. Like I said, I'm the father of two, Wyatt and Alexa. Wyatt's two months, and Alexa happens to be two years old. I don't feel that the tax cut is really a tax cut. It's more like a tax deferral. The tax cut has led us into a deficit. Sooner or later my children or myself are going to have to pay that deficit. You have not given me a tax break. What you have done is put it off until a later date, I feel.

The economy. In June, July and August 39,000 jobs were lost. The economy is taking a beating right now. We can sit back here and say that it's been ten years of horribly run government, but I don't think that ten years of horribly run government had anything to do with the softwood lumber agreement. We've taken some hits, and it seems like we just keep taking them.

These tax cuts never really helped Western Star much. I'm not 100 percent sure what's going on there, but there's a lot of families that are out of work. A lot of people think of these guys as just more people there. Oh well, they'll find work somewhere. I'm a young man. If my mill went down, I would have to leave my area to find work. There's just not a lot of work out there. That's the shape of the economy. These tax cuts have done nothing for these people at Western Star. They're still out of work. Their employer's uprooting and going to the States. I believe it is Portland.

We are a very fragile economy right now. The September 11 strikes at New York and Washington were a horrible, horrible incident. It hit hard on the economy; it hit hard on the airlines; it hit hard on Boeing and Bombardier and a lot of other areas.

The softwood tariff. They figure 18,000 of my brothers on the coast were out of work. There's a lot of people out of work from this. How many more hits can this take? This tax cut and the cuts in the public service are another hit on the economy. Can we really take very many more hits?

The tax cuts. The theory of the tax cuts is to stimulate the economy. Upper earners have got the tax break. Personally, I'm not an upper earner. I'm not one of the 20 percent cream-of-the-crop top earners. I know that for those upper earners, that tax break isn't going to really encourage them to go and buy another sofa or invest in another Chevrolet down at the dealership. It's more money for their pocket.

You talk about cutting 40 to 50 percent. That's what I've heard. I got a booklet tonight, but the information hasn't really been all that available, I've found, to an average person like myself. We talk about that 40 to 50 percent in some of the ministries. I'm not an economist. I don't have a PhD or all those other letters behind my name, but I have been a millworker in an industry that's had a tough time. I know what it's like to be laid off. I know what it's like to have the threat of layoff. You clam up when you're in the threat of layoff.

There's a lot of scared people out there working for the government right now. Do you really feel that those people are going to be boosting the economy? Sure, you give a little bit of a tax deferral — 25 percent of a tax deferral. Really, you've taken that 40 to 50 percent from the ministries, and they're just clammed right up. They're not going to be spending a cent. If anything, that's going to hurt our economy.

I hear talk like downsize and cutbacks. We're not talking about getting rid of some inventory here. We're talking about the human factor. These are people that are fathers and mothers, that have families and mortgages, that are members and pillars of our community. Being laid off and permanently losing your job is a scary, scary thing. The stress that is being put on families and communities as a whole…. I've heard people come up here and say that our jobs are in question. That is not how to boost an economy.

I'd like to talk about safety. There were a couple of child welfare workers up here today talking. In Salmon Arm not so long ago we had a small child named Tyler Lee. Tyler Lee was beaten to death by his stepfather. Tyler Lee was actually taken away from his parents at one point, I believe. They were under investigation by child welfare. Tyler was beaten to death and thrown out a window. It was awful. I believe he was two years old when this happened. We're talking about safety here. We don't need fewer people looking after the safety of children; we need more people. What we have right now is not sufficient. I can tell you that firsthand, because I went through that. We're a very close community in Salmon Arm, as is Revelstoke and all these communities around here. We all felt the pain when Tyler died, and we still feel the pain. You can't put a price on children's safety. I don't wish to be accusing, like you guys are putting a price on child safety, but I'd just like to bring that point up. Please consider the children. Consider the Tyler Lees and the other children.

I happen to have a friend of the family — I'm not going to mention any names — and she's a single mother raising two children. She also works and goes to school. She gets some assistance from welfare, and child services is there. They had an abusive father at one point, so they get some counselling. Is this the person who's going to be affected by these cuts the most — the people that need the money the most, that need this assistance and someone to talk to? Is there going to be a waiting list? Is it going to be one of these automated teller systems: "Please push one if you need help now." That doesn't work. You need the human aspect.

There's been a lot of talk about Pharmacare. That's sort of a foggy one, but we sure have a lot of people scared. There are a lot of pensioners in my area. It's a beautiful area to live in and a beautiful area to retire in. There are a lot of pensioners on fixed incomes that require very expensive medications. My mother was recently sick here, and she required some penicillin. A

small bottle was over $200. Pharmacare, I'm sure, helped her with some of that. We talked about not cutting health care spending. Well, to me Pharmacare is health care spending. If there are any cuts there, the people who will be hurt are the people on fixed incomes.

In closing, I'd just like to ask the committee to please consider the human factor of the jobs, of the families and of the communities that are affected by cuts and layoffs. That's all I have. I like it short and sweet.

B. Lekstrom (Chair): Marty, thank you very much. I'm sure there may be questions from members of the committee. I'll start with Mr. Bhullar.

T. Bhullar (Deputy Chair): First of all, Marty, I just want you to know that we are human and not a three-headed monster. There's not a single night that I go to bed without thinking about the impact this is going to have on people.

The question I have for you is: can you tell us why Western Star moved? Are you familiar with it? Why did they move to Portland?

M. Gibbons: Our company downsizing. We all know the American economy is starting to slump, and all American corporations are looking for areas to cut. I don't know exactly why we'd be moving from Canada with our low dollar here, but it's unfortunate. I believe that the president of the B.C. Federation of Labour has been trying to work on some sort of deal, but I don't believe the company wishes to deal. I believe the company just wants to pull up and move. I've actually seen the plant, which is a very modern plant. You guys were already down that way; you should have taken a tour of it.

I'm not sure of the number of people working there, but I do know that it is the largest employer in Kelowna. Is there a Kelowna MLA here? Obviously there is not. What is that going to do to that area — one more hit on our already fragile economy?

B. Kerr: I've got two young grandchildren the same age as yours, 2½ years old. I'm now looking into the future, the same as you are, for my grandchildren and my kids. I'm trying to see what kind of legacy we're leaving them.

These are really, really tough decisions that we have to make. If we don't do anything and we just carry on with the status quo, our debt will be $136 billion in 20 years' time — by the time your grandchildren are entering the workforce. That's going to be $10 billion in debt. Our health care costs are going to be in the neighbourhood of $40 billion. We'll be looking at operating costs just for health care and debt service of over $50 billion, which will far exceed any of the revenue we're bringing in. Of course what happens is that just compounds exponentially as the years go on. The question is: at what time do you stop it? At what time do you say: "Let's review it and create some efficiencies that we want so we can leave our children and our grandchildren a legacy and not a legacy of high debt"?

M. Gibbons: My answer to that is actually very quick. I don't appreciate debt, you know. You've got to run it efficiently. If you run your household on a debt, sooner or later it's going to catch up with you, and you'll be one of those bankruptcy statistics. What really kind of bothers me is the tax cut. It shouldn't bother me. I like that 25 percent on my cheque. What does bother me is that in order to get that 25 percent tax cut…. I've heard people up here say: "Well, that has nothing to do with the deficit." Do you really feel that cutting the government's income has nothing to do with the deficit on spending?

B. Kerr: It's part of it, but right now I guess…. Moving aside the tax cuts, if we did nothing, we'd still be looking at operating revenues being less than expenditures by the amount of $3.8 billion a year — forgetting the tax cuts. This is coming from the report that we've got. We're just looking at this report and saying that we have to do something somewhere.

M. Gibbons: I'm very confused here, because I thought we had a balanced budget for the last two years — no?

M. Gibbons: But it was balanced, though. Even with windfall, we can't be that far off. We're talking deficit. What I'm saying is that I personally feel that the 25 percent has added 25 percent to our debt load. Really, was it a smart thing to do? It was a political thing to do because it was promised. But was it the smart thing to do for British Columbia?

B. Kerr: I'm just trying to move that aside rather than get into a debate on that, because I could debate you on it, but I'm just trying to show you the reality. We're not looking at a huge uptick in the economy, as you know. There's not a big uptick in the economy, but the demand for expenditures is still there. That's where the deficit comes in. That's what happens.

B. Lekstrom (Chair): We have a couple of other questions, Marty, if that's all right.

I. Chong: Thank you, Mr. Gibbons, for your presentation. Just a very quick follow-up. Part of the reason why there was, in fact, a balanced budget was as a result of windfall profits. There was also an accounting policy change, kind of a technical thing, which allowed for a balanced budget. It was a bit of smoke and mirrors. That hasn't come out clearly, but I'll just give you that for background.

There are two areas you brought up that I'd like to canvass you on, and I do appreciate your presentation because you touched on a lot of areas. You mentioned that if your mill were to shut down, you'd have to find work elsewhere, and the concern you have is that there aren't a lot of jobs out there. That's something we're concerned about as well. Businesses aren't willing to bring their investment here, nor are they willing to expand. Western Star is a prime example. My question to you on that area is: what do you see that a government should be doing to get our economy going, if it were not to implement measures to attract that kind of investment? We do want to see job opportunities for people, so that if they do decide to move on their own initiative, those job opportunities would be there. Have you any thoughts on what a government should be doing to get the economy going for businesses?

M. Gibbons: I would like to just comment on that really quickly. I have a friend who has recently come back to British Columbia from Alberta, if you'll believe that. She said the reason why she has come back — she's actually a computer engineer of some sort; once again, I'm not an expert in that; I can't even pronounce it — is: "In Alberta I was making $14 an hour. I can get a job in Salmon Arm making $14 an hour." Everybody treats Alberta like it's a sacred cow: "Oh wow, Alberta's doing great". But the cost of living in Alberta has just gone through the roof. People are coming back.

For my own personal thing about the mill shutting down, I happen to be a tradesman at the mill, so I'm $20-plus an hour. With my $20 an hour I pay a mortgage for my house, I feed my family, and I pay my car payments. There are jobs in Salmon Arm — lots of them. Ten bucks an hour doesn't pay my mortgage. Or it does, but it just doesn't feed my family or pay for my vehicle. The reason I would have to relocate is to find another job with a decent rate of pay. If anything, as a government you should be looking into decent rates of pay that people can live on.

I. Chong: Just on that note, we did have some really high-paying jobs in the private sector — in the mining industry, for example. They went through some pretty devastating times in the last ten years as well. We are looking to have the private sector create high-paying jobs.

The second area I'd quickly like to ask you about is…. There's been a lot of talk about people on the front lines. You indicated that we need more people providing those services on the front lines. I don't think any of us would disagree with you there. We've heard that in the past — and I don't want to offend anyone — there has been too much so-called bureaucracy, so that in some areas there are as many managers as there are front-line workers. Do you feel that it would be an obligation on us as government, in reviewing these ministries, to take a look and see where, if there are in fact too many managers per front-line worker, we should be trying to trim that and then redirect those resources to our front-line workers? Would you agree that that is a process we should proceed with?

M. Gibbons: Basically, what I'm getting from you is that you're saying rather than a hack-and-slash, more of a reorganization.

I. Chong: If it would provide a more efficient use of the dollars to reach those people that really need it, that's what government should be providing in terms of a service.

M. Gibbons: Really, anything that keeps families from having to relocate and go through the stressful time of being unemployed…. I personally feel that anything that keeps them from doing that would be a good process.

K. Krueger: Thank you, Mr. Gibbons. You referred to yourself repeatedly as average. I don't see anything average about you. I thought you were really articulate and presented a community, family and workingman's point of view really, really well. I never like to hear people referred to as ordinary British Columbians, because I don't really think there's any such thing. British Columbians are each unique in our own way. Everybody has something to contribute. That's really what this process is all about. I want to thank you and everybody here tonight for taking the time to come and present to us.

If you don't mind, how have you and your family spent the additional take-home pay that you got as a result of tax cuts — and your colleagues, for that matter? Are people spending it in the local economy?

M. Gibbons: Everyone is so goddamn scared right now that no one's spending anything. My family and I are putting away mortgage payments, and we're putting away money for rainy days. UI pays nothing; UI is a tidbit. People who work for the government make a good wage. People who work for the government buy houses, build houses. People who work at McDonalds do not. Your cuts to the government affect me as much as they do a government worker.

K. Krueger: Again, if there were massive cuts in the civil service. We hear what you're saying. Then your experience is that people are laying away the additional take-home pay for a rainy day, which seems to be upon us. The softwood lumber issue is a huge issue for us, and September 11 did affect us drastically. When we get through these things and people feel less afraid of the short-term future, if we have the same

experience as other economies where governments have cut personal income taxes…. The result in all the other North American economies that have done it has been an actual increase in personal income tax revenue to those governments — every last one of them — because there are more people working and spending money in the economy. Hopefully, that'll be true for us. We believe it will. We were resolved to take this course of action, and we've done it. But as Tony said, it doesn't mean that we don't have a heart for the concern and uncertainty that people are feeling and for people's future. We're doing these things because we believe that British Columbia will be better off, not worse off, as a result.

This isn't your last opportunity — nor your family or colleagues — to give input to the government or to this committee. This committee does have to have a report flowing from these hearings completed by mid-November, so we've got a deadline for the end of October. But you're free to submit a further written submission, and so is anyone else you know, up to October 31. Any time after that, the input will still be welcome. It won't make it into this particular report. Thanks a lot for coming.

M. Gibbons: I'd like to just comment quickly on what you said. I don't know about the other governments that happened to cut spending. What is our deficit at — $3.5 billion right now?

K. Krueger: Our debt is at $37.4 billion. That is the accumulation of deficits.

K. Krueger: The deficit, as the Chairman said, that we are facing, even if we hadn't done tax cuts…. A lot of chickens have been coming home to roost. A lot of contracts were signed.

M. Gibbons: Did these other governments have to go $3.8 billion into debt to…?

B. Lekstrom (Chair): I'll just clarify that. When I said $3.8 billion, it would be by the 2004-05 budget. That's the time frame that we talked on balancing the budget. The actual deficit we will face with no changes will be greater than $2 billion in the time frame you're speaking of next year.

M. Gibbons: Kevin, I like tax cuts, but I like sensible tax cuts that do not spend us into deficit. That is a point that I really kind of wanted to get across. That's why I brought up my children, because I myself, over 29 years, am going to have to pay this bill sooner or later. When you guys have all left the table, I'll still be sitting here with the cheque.

B. Lekstrom (Chair): I do have a couple of quick questions from members of the committee — with your indulgence, Marty. It's obviously a great presentation. You're getting a lot of questions. I will go to Harry.

H. Bloy: A lot of the questions have been answered. I appreciate the passion in your voice and your concern for fellow people, and I believe that the whole committee has this. Some programs have worked; some programs haven't worked. I don't look at this as a slash-and-burn and cut everything. We look at this as a sensible approach. The reason we came to the communities was to listen to people like you to get firsthand experience and information so we can take it back to put into our report. Most of the questions have been discussed as you've gone up and down. Thank you for your time.

B. Penner: Just on the topic of Western Star. As you know, it was purchased sometime in the past year by Freightliner. Like you, I'm very distressed to hear Freightliner's announcement that they want to close the Kelowna plant. The silver lining in all of this is that they said that closure will take place about a year from now, so it's not immediate, but it's still very worrisome.

I wouldn't describe myself as an optimist but more as a stubborn individual. I'd like to think that that one-year notice gives us some time, collectively as a province, to see if we can convince Freightliner to change their mind, pointing out the cost advantages that you mentioned in terms of the low dollar, the efficient plant, the skilled workforce, our tax cuts and business tax cuts. Hopefully, 12 months from now the market in the United States will be stronger for trucks than it looks right now. I'm not sure if I'm optimistic, but I'm fairly stubborn. We're going to work hard to try and keep them here.

M. Gibbons: I guess there's a few of us in the room that are stubborn, because, goddammit, I don't see a silver lining in one year. I see a 25-year mortgage and people with small children. I hope, together with the CAW and the government, that Western Star and Freightliner can stay in our province and employ people in the Okanagan.

B. Lekstrom (Chair): Just in closing, Marty, I want to thank you. You touched on something. I had 17 years of labour background in which I worked for our union and learned a great deal. One of your comments on the tax cuts was that certainly the upper income seem to have benefited more. I relate that back to the days of negotiating an across-the-board or a percentage increase for the brothers and sisters I worked on behalf of. It is a balance. You would probably have to agree with that. Certainly, a percentage grows the gap versus across-the-board. But that's the kind of balance we take on and try and deal with.

As far as your "ordinary citizen" comment, I guess I'm going to have to jump out. I thought I was one as well, so I guess we're both unique, then. Thank you very much.

M. Gibbons: Just a quick comment there. The reason why I brought up the upper earners…. Basically, my point was that the people who do spend and stimulate the economy are the people in the tax brackets that buy the cars and pay the mortgages. For the upper earners, a small tax…. What does that mean? An extra weekend in Aspen? That's personally how I feel. Thank you.

We will move on. We are going to go early to the open-mike session. Right now we have no other registered presenters. The open-mike session was not slated until 8:30 this evening. We've had a number of interested people approach Josie at the back table. At this time I would like to call Ian Schierbeck forward. The open-mike session is somewhat limited in time, but if we can get through, our time frame is quite open at this point.

B. Lekstrom (Chair): Yes, I've noticed that our third presenter has a time commitment, and I will get to him.

I. Schierbeck: Thank you, Mr. Chair and members of the panel. I appreciate the opportunity to make a few short comments to you. My name is Ian Schierbeck. I am retired and living in Salmon Arm.

What has been troubling me over the last few months with some of the news releases of the provincial government is that I recognize that we are not indeed in the process of building our economy by destroying jobs. We are not helping the economy by destroying the support structures for children and other disadvantaged. We are not helping the economy by dismantling Pharmacare, which I might say that I depend on to a great degree.

I'm concerned that there are no significant numbers of jobs that have been created by these tax cuts. Indeed, I would also request, as others have before me, that implementation of these tax cuts be delayed during this economic downturn until such time as we can afford it. I'm very concerned with the increases in deficit, in the ultimate costs to taxpayers — which I am to a limited degree now.

I would request that your committee recommend to the government of British Columbia or to caucus — I'm not sure what your reporting structure is — that we invest in people during this downturn, not cuts, not downsizing and not negativism. I'm concerned about the number of comments in the media about the downturn in the economy and what the government's response has been to it. What we are starting on there is a self-fulfilling prophecy. Indeed, we will suffer an economic downturn all the more because of the negativism.

I would certainly recommend that we increase spending on education. We see training requirements increasing for teachers, doctors, nurses and tradespeople. We have seen the fallacy in cutting out the opportunities for education in nursing under the Social Credit government, and it was continuing under the NDP. That has been a disaster. Watching what happened to it, I must say that I don't appreciate the government's response to it — simply legislating them back to work. I think you should have allowed the free collective bargaining process to continue. In short, I certainly recommend and hope that together we can help get B.C. working. And I mean that in its most literal sense.

T. Bhullar (Deputy Chair): Just a quick question, Ian. I can't see your button from here. What does it say?

B. Lekstrom (Chair): All right. Just for clarification, you asked about the reporting structure of our committee. We are a committee struck by the Legislature. We are due to report out by November 15. We will deposit our report with the office of the Clerk at the Legislature which then becomes a public document and will be utilized in the preparation of the upcoming budget. Thank you for coming out this evening.

F. Anderson: Good evening. Maybe somebody heard that I was coming up here or something. I gave a presentation in Kamloops, and I did not come here tonight with the intention of saying anything further. However, there were a couple of things that came up, I guess, in somewhat of a response that I have felt a real need to try and address. Kevin Krueger asked — I think it might have been the first presenter: how do we do this? We can answer the whys to some degree, but how do we manage our budget? How do we get to where we're trying to go? And I sense even from the panel that you may be feeling like you're not getting as many responses telling you how you do it.

I want to respond by saying that to some degree I think it's because a lot of people, myself included, are feeling like we're hitting a bit of a brick wall. That brick wall is: "Yeah, tell us how we do it, but this is the timetable it has to be done in, and these are the tax cuts that we are going to go ahead with. We're almost going to ignore September 11." I guess that's where I find the real frustration. You talked about being compassionate with the people. Well, if you're going to be compassionate with people, then you will recognize September 11, and you'll recognize that your timetable in today's economy, post-September 11, is unreasonable.

Tony, I heard you ask somebody: "Well, how do you think September 11 has affected us in British Columbia, not the U.S.?" I don't know what you meant by that, but I think it's astounding to suggest that September 11 doesn't affect us. Clearly, it affects us in a great way.

B. Lekstrom (Chair): Just to clarify, I don't believe I heard that from Tony or any other member. I think there's a clear recognition by every person, every human being here, that September 11 has had a profound effect on all of us.

F. Anderson: Okay. Well, if it has, then why is it that while the President of the United States has changed his agenda and is going to pump all of kinds of money into their economy, this government absolutely refuses to change its agenda?

B. Lekstrom (Chair): If I could just clarify. We're here to listen and gather ideas. I can't tell you exactly what's going to happen. That's part of the reason we're out listening to the public. We are in the process. Government has a mandate to put budgets forward. It will be put forward in February. Personally, I can't think of a better thing to do than to go out and listen to the people of British Columbia on their priorities, because I don't believe there's a British Columbian who doesn't recognize that we are in severe financial difficulty in our province. To trudge ahead and do it without listening to the people…. I think it would be justifiable to criticize your government. We're trying to do the best we can by going out. In all honesty, every single thing we've heard and every recommendation we hear through these hearings probably won't be able to be implemented. But we have to have the ability to go out, listen to the people and put a balanced report forward, and that's what we're here to do.

F. Anderson: You know what? I appreciate that, but I guess where people get somewhat jaded is that while you're doing that, your boss is out saying: "We're going to cut 35 to 50 percent." While you're doing that, there's supposedly a core review going on to review what the core services are. Somebody might say, "Review the core services; maybe that makes sense," yet you've got another part of your government talking about massive cuts. How is that associated with the core review? You say: "Well, we're not going to cut just because of cutting." Is that not just cutting because of cutting? When you're in the middle of a core review, rather than waiting until the core review is done, we get an announcement that every ministry is asked to review cuts of 20, 35 and 50 percent. If you don't think people are scared out there, you're kidding yourself. If you don't think that has affected the economy…. I mean, that has really affected the economy. You want a clear suggestion? I'll ask you this question directly. Maybe I should put this in waste-buster.

Let me put this scenario. Right now Air Canada is laying off people, as are other airlines. If, when Air Canada was laying off people, at the same time it hired more managers and paid the existing ones 40 percent wage increases, don't you think people would think that was really absurd? Yet this government has the largest cabinet in the history of British Columbia, more MLAs collecting a cabinet salary than ever before. This government has given two significant wage increases: one when they first came in and one real significant wage increase to deputy ministers, the managers. Are they going to share in the pain? Are those the managers that are now getting rewarded during a time when you're trying to look for efficiencies? Explain to me how that makes sense.

B. Lekstrom (Chair): Frank, just if I could pull it back on track somewhat. We're here to hear views and suggestions on what we can do to try and….

F. Anderson: Okay. My suggestion is to roll back the deputy ministers' wage increases and reduce the cabinet. It astounds me, to be honest with you. I can't get a clear answer to that.

F. Anderson: If Air Canada were to do something like that, how would that make sense?

B. Lekstrom (Chair): Again, there's quite a bit to this, and certainly this isn't the appropriate time to debate the issue of deputy ministers' salaries or the nurses' legislated settlement, for that matter, and so on.

F. Anderson: The nurses didn't get anywhere near what deputy ministers got — not close.

B. Lekstrom (Chair): To bring this back on track, Frank. Certainly, this is the second time we've heard from you, and if you could stay focused on some ideas in the prebudget….

F. Anderson: Okay, I'll move on to a couple of other things. B.C. does have the second-lowest taxpayer debt per capita in the country, and you can credit it to somebody who was Premier a quarter of a century ago if you like. But what we should do is look at that, give credit to that and say that maybe we should look at what we're doing post–September 11. If there's one message I would have to say to you — and I think you've heard it from some people — it's that the reason why it's becoming hard to answer the "how" is because…. You're saying, "Think outside the box," but you've put it in a box. Think of the how on this time frame and with these tax cuts. That's the difficulty people are having, especially after September 11. If you want to be compassionate with people and you want to have the cuts not be so severe that they affect families and economies, you have to extend it beyond a bigger time fame than what you have.

You know what? I think it's fair to say that the average British Columbian would understand that September 11 changed things. We wanted to balance the budget in 2004-05, but nobody could predict September 11. To suggest that the average British Columbian wouldn't understand that is really an insult. People understand that.

I heard here this evening that bankruptcies are potentially a good sign for the economy. I'd sure like to hear one of you quoted on that one. I can't believe that, honestly. These are challenging times. They're challenging times for everybody. I guess what I'm pleading with you to do is to think outside your set time frames and your set tax cuts and try to explore ways in the new economy — post–September 11 — to address this problem, so we can work together in addressing it. I don't feel like we can work together, because we're coming to the table with an unworkable time frame and having to deal with tax cuts that you're insisting you're going forward with. That's what's making this difficult.

B. Lekstrom (Chair): Okay. Frank, our time frame is limited. Again going back to the September 11 reality of what hit all of us, I think it definitely has changed some mindsets as to how we look at economies. As far as the issues of what we're looking at, September 11 was one thing that hit us, but long before September 11 there was certainly a clear recognition not just by the members of the government but by British Columbians that what we were doing wasn't working. To be quite honest, I'm the father of two children, and I'm not prepared to dig the hole any deeper for my children to pay. It takes all of us.

After an election, you know, it takes all of us to build out of it, whether the people are supporters or non-supporters of the government. Really, we're hearing a good cross-section of people coming and presenting. Not everybody has come out and patted this committee on the back to say: "Good on you." We've had a group of people say that. We've had others say, "Please have a look at what September 11 has done," and we've had others to say: "Everything you've done to date is wrong." That's the thing we do as a committee. We take all that in balance, we put together a report, and on November 15 we will deposit that report. It will be a public document. I can assure you that balance will be used. At the end of the day we may not agree on what that report says, but everything that's said to us will be taken into consideration.

F. Anderson: What I'm saying to you is: if you're talking about not wanting to dig the hole deeper, cutting 35 to 50 percent is going to have exactly that effect.

B. Lekstrom (Chair): Frank, I want to thank you for coming out again and speaking to us. We will move on.

We do have Mr. Greg Edwards wishing to speak to us. Greg, thanks for staying around. Good evening.

G. Edwards: Hi. I'll just start by saying that I really wasn't going to present at all this evening. I'm just an average guy who came to listen. There were a few things said. I guess maybe I'll start off. I'll just introduce myself a bit. I work on the railway; I'm a locomotive engineer, like one of the other presenters. I'm active in my union. I've lived here in Revelstoke for 15 years. I grew up in the East Kootenays. I've lived in the West Kootenays; I've lived in the lower mainland. I travel the province quite a bit. That's who I am.

The main reason I felt compelled to come up and talk was because there were a couple of things said by committee members here that I thought should be responded to. They both hit on assumptions, I guess. One of the members said: "We elected 77 seats." Well, okay. Did you get 97 percent of the vote too? You didn't. The number of seats is a poor indication of the total support. You definitely got a large mandate from the electorate in this province, but you certainly didn't get 97 percent of the votes. It's created an imbalance. I'm not here to talk about how our representation system works, but it has created an imbalance. That is probably why so many people feel compelled to come here to discuss it. They may not have their representatives in the House. So I would caution the committee about throwing that number out there. It doesn't reflect the reality of the vote or the reality of where the people were at.

Another committee member asked one of the previous presenters why people aren't investing here in Revelstoke. It dawned on me that we're not really talking about what's been going on in Revelstoke. Over the past ten or 15 years, as long as I've been here, regardless of what's been happening with the provincial government and all the doom-and-gloom talk we have, things haven't been all that bad here.

We're sitting in a hotel that was built and opened less than two years ago. Somebody invested here. Since I've moved here, they opened a water-bottling plant outside of town that at one point employed nearly a hundred people. It's closed down now, but those decisions had to do with Coca-Cola and some Montreal corporation and were made outside the jurisdiction of your government or any previous provincial government or anything else. But it was a success. Downie Street Sawmills was closed when I moved to town. It's reopened. It's running three shifts, and it's expanded. It's now got a value-added plant that's doing quite well: Selkirk Specialty Wood. We built heli-ski lodges, the Super 8 Motel has been built, and both grocery stores in town here were expanded this summer.

When I moved here, this town was going through a process of serious change in how our economy works. We've managed to do that, and we've managed to maintain our population base and keep the people here working through all of this doom and gloom that we hear. To simply throw out easy statements like why people aren't investing in Revelstoke really doesn't…. It's not true, but people take it at face value. You ask why people aren't investing in B.C. That's simply not the case. We may not be getting as much investment as we have, but it's certainly ignoring anybody who does choose to come here or has chosen to come here in the last ten years.

What's happened here in Revelstoke, the reason why we've had a lot of investment here, is that we have an active community that works together to get things done. We do think outside the box. A lot of these investments were done simply by the efforts of a good

city council, of good city staff, of a good business community that works towards it and a workforce that's willing to work for it. Making investment capital available through Revelstoke Community Futures…. We work well with all of those things together here in Revelstoke. It hasn't all been doom and gloom. To say that everything that's happened over the last ten years has created this huge disaster and that we must totally throw everything out and move something new in is to ignore any success that has happened anywhere in this province in the past ten years. There are success stories.

You're not in opposition anymore. You're now on the government side. In order to move forward with things, particularly given the structure of our Legislature this time around, the government MLAs — more so than ever — have a responsibility to stop being quite as partisan as in the past. I know that some of you have been standing on one side of the House saying something. That's the job of the Legislature and how it works. But there have been things going on in this province that have worked. They worked with the tax structure that we had. That's not the panacea that's going to fix everything.

There are other solutions to some of the things. We don't necessarily need to devastate the public service and say that we're required to. We were hearing all of this talk about budget deficit earlier. We went from a projected $25 million budget deficit to one-point-however-much billion in this year. That was announced on the same day or the same week as the tax cuts. To say that you have no choice in the tax cuts and all of this…. Well, there are choices. There are choices on the tax end; there are choices on the spending end. Don't take straight assumptions. Everybody will always say that there's huge administration and bureaucracy there. I haven't seen the figures for a few years. About three years ago I looked, and B.C.'s public-servant-to-population ratio was, if not the lowest, one of the lowest in the whole country. If you look at that figure, it would suggest that maybe there isn't that much in terms of waste, unless you're going to start getting into whacking programs. Or are you going to cut the public service, who run these programs, to the point where the programs don't work anymore?

I've hit the end of my stuff here. Like I say, these were just thoughts. As I was sitting there, I felt more and more compelled to come up and talk about a few of these things. It really bothers me when very easy, glib statements come out, which make assumptions that everybody makes. They don't tell the story, and they don't really do a very good job in determining where we are today and where we have to go tomorrow.

B. Lekstrom (Chair): Well, Greg, thanks. I know there are questions. There are far too many assumptions made, I think, from most people out there. For instance, the assumption that the deficit we were facing was so minor that the tax cuts have now increased it. Sitting down, opening the books, taking the partisanship out of it and looking it as a business, there are some significant challenges. We can't change yesterday or ten years ago or through the last ten years. Hopefully, we can learn from it, though, and build for the next ten or 50 years. Those are very fine comments.

T. Bhullar (Deputy Chair): Hi, Greg. The 77 members that you were referring to — that was my reference. Just a quick thing that I want to point out. If the government's policies — and you know, you talk about partisanship — are that draconian, and everyone's heard about the core services review, why are there so many empty seats in this room? Not even a quarter of the seats in this room are filled. If the government's policies are so bad and the government's embarking on a course that's unacceptable, why are three-quarters of the seats empty?

G. Edwards: They may be right now. There have been people coming and going, and I would bet if you put everybody in at once, it would have been half. I guess the question to you is: where are all the government supporters?

T. Bhullar (Deputy Chair): I'm not going to engage in a debate. Perhaps they're happy at home that they've got tax cuts.

B. Lekstrom (Chair): To move on, Greg. I know it is a tough thing to hold back, but we're really trying to move ahead. The ideas and comments that we hear are welcomed. Versus moving into a back-and-forth, I'll move to our next questioner, Mr. Bray. Then we'll move on to Lorne, if you have time to answer those.

J. Bray: Greg, I'm glad that you did come up, step forward and point out all the positive things that have happened in your book. I think that's good, and I'm glad you took the time to do that. It's good for members of the committee, who don't live in this area, to hear that there are success stories. All that helps with some balance. I'm glad you did that.

One of the things we are trying to do is find some solutions to not just get rid of jobs but maybe reallocate them. We've heard from people from the social services and the child and family service field, where they're already struggling under large caseloads. In other parts of the province we may hear that there are 25 people in our ministry writing press releases, but we don't have enough social workers in Columbia-Kootenay. I think that's what we're trying to look at and maybe not necessarily remove the jobs but try to find a way to reallocate them to more effective areas. It's those types of things that we're looking at.

I do think you hit on another good point, and that is that we have a unique Legislature that is dominated by one party right now. It does allow us, I hope, to take out some of the politics, because we can't pit one region against another — urban-rural, north-south. In essence, the current government has members in all those areas. Hopefully, we will be making more pan-provincial decisions, not worrying about which person it's going

Those are the things this committee is looking for, which we do our report on for the Minister of Finance: decisions that are good for the province, not good for a region that is favoured by one party over another. I take to heart those words, and I'm glad you raised that. That's what I wanted to say.

G. Edwards: Thanks. That makes a lot of sense. If you're talking about reallocation, I hope you'll engage the workers in that dialogue, because they're the people who probably are best situated to identify that.

L. Mayencourt: First off, Greg, I didn't mean any offence by that question at all. If you did take offence from that, I sincerely apologize.

I don't come to Revelstoke very often, so I look at other things — at pieces of paper — that tell me a little bit about it, give me a snapshot of the community. What I was referring to when I asked about building starts was that the census of Canada tracks what's happening in your community. What I was looking at is five years back. It was ten, and this year it's five. What happened? I'm trying to get a sense of what it is that changed.

G. Edwards: I can tell you. The reason that those statistics may not show up, with all of the positives that I've pointed out, is in the meantime all of that happened as we were winding down building a dam. We'd just built a huge megaproject in the tunnel for the railway through the pass, which inflated the population of this community with short-term, five- to ten-year megaprojects.

Another huge thing that happened was that the number one employer in this city since I've moved here has moved all of its coal train maintenance from here to Golden — for operational reasons, mostly. They've centralized all of their administrative functions, or the majority of them, to Calgary. They've done that from around the country; they've centralized it all to Calgary. They've also changed their maintenance programs on the track, where instead of having people who work on the track — "this is my piece of track, and this is what I do" — they have these roving gangs that come through.

All of these things have hit our largest employer and gutted the workforce from our largest employer, plus losing the megaprojects. Throughout all of that, we've managed to maintain a population that is fairly well employed, between the 8,000 and 9,000 mark. It's an economy in transition; it's not an economy that's shrinking. It's actually a very healthy economy. It's gone through a huge transition.

The people of this community really are the ones — the leadership and the people and the volunteers. It's really what made it happen. I'm quite proud to live in this town and call it home.

L. Mayencourt: I thank you very much. I really have enjoyed the time I've spent here. I just want to be really sincere about that. I didn't mean to offend you or anybody else in the room. I'm from the big city. I come here, and I don't know where…. I'm trying to find out a little bit about your community. It's very helpful that you have been able to educate me on that, so thank you, and please accept my apologies on that score.

B. Lekstrom (Chair): Greg, I'd like to thank you for your presentation. Certainly the open-mike session is what it's all about: people having sat through and heard different things and wishing to bring some ideas forward. I thank you for that.

S. Harvey: Thank you for taking time to hear me speak tonight for the Revelstoke for a Safe Trans-Canada Highway organization. As a preamble, I've lived in Revelstoke for over 29 years. My husband and I run a value-added sawmill where we cut wood for soundboards. I've always been active in my community. As you know, last November 2000 we had that terrible Taiwanese bus accident in the Lanark snowshed, where six people were killed.

In front of you you've got our brochure. The reason I'm here is to bring the brochures and also our bumper stickers that say "Save Lives" and our website, which is www.fixtranscanada.org. I invite all of you to please go on our website and see some of the stats and information we have there.

Over the last 12 years — I don't know if you're aware of this — we've had 126 people die here and 2,278 injuries. In the area of Revelstoke, mainly from Salmon Arm to the Alberta border, these highways were designed in the early 1950s. They started in 1959, and very little has been done since. The mandate of our committee is that we are pushing, asking, requesting that provincial and federal politicians come together and have the political mandate to work on having a divided highway. Divided highways have proven to save lives. When you look at the 126 people that died in a 12-year period and the 2,278 people who were injured, that's a burden on our emergency and health care systems. There is some other information in here that you can read through on the website. I'm told that I only have a few minutes, so are there any questions?

B. Lekstrom (Chair): Gosh, that was a lot in a short time. I will look to members of our committee if there are any questions for you.

K. Krueger: You're certainly right that there hasn't been much done and not nearly enough with regard to the upgrade of infrastructure, particularly with the Trans-Canada Highway. What has the maintenance been like of what we do have for a roadway over recent

S. Harvey: I've been told by people who are out on our highways that it has declined and that we need to have better maintenance and servicing, especially on Rogers Pass.

S. Harvey: No, I do not winter-drive any more than I have to, and I do not go east. I'll go west but not east.

K. Krueger: Your understanding is that the quality of maintenance has declined.

S. Harvey: That's what I've been told from several sources. I have been at meetings where they've had a discussion about it. Again, they talk about budgets, and they talk about trying to provide service till certain hours. I do believe that on the Trans-Canada Highway you should have 24-hour coverage, because the roads can change so fast in our area, especially with the amount of snow we get and the cold and other weather conditions.

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

B. Penner: It's tough for a politician to resist making a comment or speaking. My guess would be that the majority of the deaths or fatal accidents occur in the winter months. I'm wondering if that assumption is correct.

B. Penner: So it's not necessarily icy or slushy roads that are contributing to the accidents but maybe something else.

S. Harvey: It's the design of our highways, I would say. We've checked out studies that have been done in the United States and other areas, and it's been proven that there's a big difference in the number of deaths on a two-lane highway versus a four-lane highway. You know, they're making our vehicles so much bigger and faster, and the roads are not designed to meet our needs today.

S. Harvey: I wouldn't want to comment on that without having other stats in front of me. I know that in our area, over the last 29 years I've lived here, we've had terrible accidents of different degrees at different times of the year. It's not just the winter months. We've had as terrible bus accidents in the summer as in the winter.

One of the things that has come to light is our snowsheds. A number of our snowsheds did not have lights. Through our committee, we've been pushing for lighting, and I'm told that most of the tunnels will have some lights by the end of this December. The rest are to be done by next year. Have you ever driven this road?

J. Bray: I come from Vancouver Island, so we have a different transportation issue, but it's also one that sort of dominates conversation. It seems that among other things, one of the things you're saying is that an immediate need would be to make these sections a divided highway. Have you gotten from the Ministry of Transportation some sense of what the costs would be? I would imagine there would be some widening of shoulders and so on.

S. Harvey: Yes. We have a committee that is working on that. We don't expect it to be done tomorrow, but the Revelstoke for a Safe Trans-Canada Highway committee and, I believe, Canadians in general and British Columbians are tired of hearing the talk and the pointing of fingers at the provincial people and then the federal people — and studies, studies and studies.

For instance, for our Three Valley Gap area, I don't know how many studies they've done. I'm sure there are enough studies there that you could….

J. Bray: Maybe somebody should do a study to see how many studies have been done.

S. Harvey: No, we don't want to hear about that. We want to see the action on the ground. Our first one is to save lives. Safety is No. 1. We travel our roads to do business, to take our children out to sports and all kinds of different activities, as you know, that we do in a year. That's what our mandate is. We want to save

lives, No. 1, and No. 2 is the economic upturn that it would be for our area when that would happen.

J. Bray: My follow-up question, which I was sort of going to lead to — not knowing what the cost is, and obviously there's probably a fair price tag to it — was: would your committee consider possible tolls for cost recovery? Now, there's not permanent tolls.

S. Harvey: Yes. Actually, we've talked about that. In the United States I've had family on some of those toll bridges and highways, where you just come up and throw in a handful of change. That's something we might have to do. When you take a look at 12 years where 126 people were killed and 2,278 people were injured, never mind the property damage, there's a lot of money you could save by having a divided highway.

B. Lekstrom (Chair): All right. Well, Ms. Harvey, I would like to thank you for coming to the committee this evening and putting your views forward. I think most people recognize that there are some serious situations not just with the highway that you speak of but right throughout the province on the upgrades that are needed. Thanks for coming out this evening.

B. Lekstrom (Chair): That concludes all of the people that have requested to speak here this evening. I would look to the crowd, if there are any others that would like to address the committee at this time.

A Voice: I'll talk here. It's just a quick question. The gentleman was saying that there is very poor turnout. The reason for that is because, today and yesterday, I phoned approximately 15 to 20 people, and one of those people had heard of this meeting tonight. That's this gentleman sitting right over here. The rest hadn't heard of it, including the superintendent of our school district and our board Chair for the school trustees. They didn't have a clue this meeting was even on, so the advertising was very, very poor.

B. Lekstrom (Chair): Sir, I can follow through on that. We do have a program for advertising and so on. To be honest with you, I will check to make sure that it was followed through on.

I understand it was. The Clerk's office has always done an effective job, but we can check on that.

A Voice: It was in the paper, but it was on a back page, and you could hardly see it. Everybody I work with and the people I talked to at the wicket — I work at Canada Post — didn't even know this was existing. I didn't like his comment about only the two seats because everybody's contented. Eighty percent of Revelstoke probably didn't even know it was here.

B. Lekstrom (Chair): I know the time frame is short, and I will apologize if the notice didn't get out properly. Certainly, the key to an effective meeting is making sure people know there's a meeting happening to begin with.

I will do some follow-through. I'm unable to change the events for this evening, but I can certainly take what you've said and….

A Voice: I didn't know about it. If Doug hadn't phoned, I wouldn't have known this was existing.

K. Krueger: Let's re-emphasize that people have the opportunity for written input, because that would make people feel they haven't missed the only opportunity.

B. Lekstrom (Chair): There is that, and we will. Until October 31, we are accepting written submissions as well. Certainly, to any members of the community you are talking to, you could express that they do have the opportunity to put it forward. We will certainly investigate if we can — and it sounds like we can — do a much better job of letting the public know about these meetings. Thank you for your comment.

B. Penner: I really appreciate the woman's comment about advertising. Maybe the committee can consider some alternative ways of advertising. I know that the traditional method is to book ads in the community newspapers, and you have very little control over where in the newspaper those ads end up. If they end up buried in the back section of the paper, I know I wouldn't read it. I wouldn't see it. And I'm a person who's quite interested in current affairs. Maybe we have to think outside the box and think of putting up a poster at the post office, where people congregate. That's a fairly inexpensive way to get the word around. It's an old-fashioned way, but maybe that's something we can think of in the future.

B. Lekstrom (Chair): I can assure you that from your comments this evening, we will follow through and improve our strategy on communicating to the public.

A Voice: Well, I was upset because I didn't hear about it until Doug told me about it last night.

B. Lekstrom (Chair): We are here as a committee, and Hansard is recording everything. If it's an issue of communicating, we can discuss that. I will at this time call a recess for a half-hour, in case other individuals

do show up. We can discuss this during the recess if you'd like. We stand recessed until 8 p.m., at which time the committee will reconvene.

B. Lekstrom (Chair): At this time I will reconvene the public hearing. We do have a further witness that would like to present. I will call on Ron Sahlstrom. Good evening, Ron.

R. Sahlstrom: Good evening. I wasn't even planning on making a presentation of any type tonight, but I figured with a lack of crowds here, why not? I was actually enticed by Brian over there. When we were chatting earlier, perhaps I do have a perspective that I can pass on. I work in tourism. That has not been represented, so far, by anyone who has spoken before me. There was no one involved in tourism. It does give us a different perspective.

In my position, I frequently talk to people from all over the world. Over the years I've also worked in many different locations and with many different types of people. I've worked as a heli-ski guide and as a musician-entertainer, which is what I do now for the most part. I've taken high-profile clients into the mountains and had plenty of time for discussion. I've brought potential investors into Revelstoke for our ski hill. I don't know if you have any history on our ski hill or the development proposal that has been put forward, which the community has been working hard on.

Over the years one of the things that most investors have said has really held them back from investing is the lack of ability to work with the NDP government, the high taxes that they would have to pay, the cost of doing business, the cost of doing studies, native affairs and transportation issues. B.C. is transportation-challenged because our communities are spread out. They're separated by little windy roads. You know, we are transportation-challenged in getting goods and services in and out of B.C. I grew up on Vancouver Island. Getting goods and services to Vancouver Island with the ferries is a real issue. We have, potentially, the most prosperous province in Canada with an economy that seems to be stifled by a lack of ability to get our products transported.

In tourism, our product is people. If the highway scares the people, we can't do business on the same level as, say, Banff. They fly into Calgary and pretty much drive a straight line to Banff. That makes it easy. A lot of major tour operators will not travel more than three hours from an airport, because they're power-travelling. Asian markets — they're power travellers. They want to see as much as they can in as short a period as they can. They're very susceptible to being scared. If they hear at home of a major accident, it might scare them from coming to B.C.

Improving the highway to a point where it's acceptable to people would certainly help increase the number of people we bring to our province. Revelstoke may not have grown a lot in the last few years, but I think it was brought up — and brought up very well — that we've had megaprojects here that have come and gone. At one time Revelstoke's population was 13,500, I believe. This was back in the 1980s. It now sits at 8,500. So the infrastructure was built to accommodate those people. Imagine what it did to the tax base of the community to swell to that size, have homes built for all those people and then shrink back down. This community has adapted and done extremely well, but we will hit the wall unless we can get people here and unless we can convince people that it's easy to get here.

To think in terms of Revelstoke alone wouldn't, on its own, get people here. We have Golden — just developing a ski hill there. We're developing in Kimberley. We've got Big White, Kamloops and Vernon developing theirs. There's a very good opportunity this winter. With what happened on September 11 — to turn a negative into a positive — people will be driving through this province this winter. Turning our best face forward, we have an opportunity to show people what we can do in B.C. and to bring them back again. That's how I see it. Anyway, that's pretty much all I've got to say right now, and I wasn't expecting to say anything.

B. Lekstrom (Chair): Well, Ron, I appreciate you taking a few moments of your time to give us your view on it. As I indicated to one of the previous speakers, that's really what we're here for: to hear from people their views and ideas. I thank you for taking the time.

B. Kerr: Ron, you mentioned the people you talked to and about the taxes being high. Would that be personal taxes for the investors — that they don't want to move here themselves or they don't want to invest in business here because the corporate taxes are high?

R. Sahlstrom: Corporate taxes. As far as people moving to B.C., the quality of life and the price of housing in B.C. are fairly attractive as opposed to a lot of places. People do like to come to B.C., but setting up business here has been expensive.

B. Kerr: Essentially, if we could create a favourable business climate where people would invest, which in turn creates jobs, do you think you could get the people here?

B. Lekstrom (Chair): I see no further questions, Ron. Again, in closing, I want to thank you for coming out.

Seeing no further speakers or presenters here this evening, I will now call our meeting adjourned.

REPORT OF PROCEEDINGS (Hansard)

SELECT STANDING COMMITTEE ON FINANCE AND GOVERNMENT SERVICES

REPORT OF PROCEEDINGS
(Hansard)

SELECT STANDING COMMITTEE ON
FINANCE AND GOVERNMENT SERVICES