2011 Legislative Session: Fourth Session, 39th Parliament

SELECT STANDING COMMITTEE ON FINANCE AND GOVERNMENT SERVICES

MINUTES AND HANSARD

MINUTES SELECT STANDING COMMITTEE ON FINANCE AND GOVERNMENT SERVICES

Tuesday, October 11, 2011

9 a.m.

Tynehead 1 Room, Sheraton Vancouver Guildford Hotel

15269 – 104 Avenue, Surrey, B.C.

Present: Rob Howard, MLA (Chair); Doug Donaldson, MLA (Deputy Chair); Bill Bennett, MLA;
Mable Elmore, MLA; Dave S. Hayer, MLA; Pat Pimm, MLA; Bruce Ralston, MLA; Bill Routley, MLA;
Dr. Moira Stilwell, MLA; Jane Thornthwaite, MLA.

1. The Chair called the Committee to order at 9:00 a.m.

2. Opening statements by Rob Howard, MLA, Chair.

3. The following witnesses appeared before the Committee and answered questions:

4. The Committee recessed from 11:37 to 11:39 a.m.

5. The Committee recessed from 11:54 a.m. to 1:02 p.m

6. The Committee recessed from 2:56 to 3:05 p.m.

7. The Committee adjourned to the call of the Chair at 4:36 p.m.

The following electronic version is for informational purposes only.

The printed version remains the official version.

REPORT OF PROCEEDINGS
(Hansard)

select standing committee on
Finance and Government Services

Tuesday, October 11, 2011

Issue No. 53

ISSN 1499-4178

[ Page 1519 ]

TUESDAY, OCTOBER 11, 2011

The committee met at 9 a.m.

[R. Howard in the chair.]

R. Howard (Chair): Good morning, everyone. I'm Rob Howard, MLA for Richmond Centre and Chair of this parliamentary committee. I would like to welcome everyone and thank you for taking the time to participate in this process.

Each year, in preparation for next year's budget, the Minister of Finance releases a budget consultation paper which guides the committee's annual consultation process. The budget consultation paper presents a current fiscal and economic forecast. It also identifies key issues that need to be addressed in the next budget.

There are well-published global economic challenges in Europe and the States, and what we are seeing is that governments who have not been fiscally responsible are being punished. In B.C. we have maintained our triple-A credit rating and are committed to balancing our budget in fiscal 2013-2014. This will serve us well to protect and grow our job base.

These challenging circumstances mean there are difficult questions ahead, and we look forward to hearing your priorities in these challenging times. Print copies of the Budget 2012 consultation paper are available on the information table at the back of the room.

The Select Standing Committee on Finance and Government Services is a parliamentary committee which is responsible for conducting public consultations on the forthcoming provincial budget. Our all-party committee is required to report back to the Legislative Assembly no later than November 15 of this year.

This year we will hold 13 public hearings in each region of the province. We have also scheduled two video conference sessions to hear from residents of eight rural communities living in more remote areas of B.C. This is the third time we have tried this consultation method.

We opened our hearings in Vancouver on September 15 and then travelled to Fort Nelson, Smithers, Prince George, Williams Lake, Kamloops and Courtenay before returning to Victoria. This week, after Surrey today, we will be travelling to Chilliwack, Cranbrook, Kelowna and ending our hearings in Richmond.

In addition to the public hearings, there are a variety of other ways that British Columbians can share their ideas with us. We accept written submissions by letter or e-mail and also video or audio files. Further information on how you may participate using one of these methods is available on our website: www.leg.bc.ca/budgetconsultations.

Committee members carefully consider all the public input we receive, whether it's an oral presentation made here today or an on-line survey form, a submission in writing or an audio-video clip. Our deadline to receive submissions is Friday, October 14.

At today's meeting each presenter may speak for ten minutes, with up to five additional minutes allotted for members' questions. Time permitting, we may also have an open-mike session near the end of the hearing, with five minutes allocated for each presentation.

Today's meeting is a public meeting, which will be recorded and transcribed by Hansard Services. A copy of this transcript, along with the minutes of the meeting, will be printed and will be made available on the committee's website. In addition to the transcript, the live audio webcast of this meeting is also produced and available on the committee's website to enable interested listeners to hear the proceedings as they occur. An archived copy of the audio broadcast will be retained, also on the committee's website.

I'll now ask the other members of Finance Committee to introduce themselves. I'll start with Mr. Bennett.

B. Bennett: Good morning. My name is Bill Bennett. I'm the MLA for Kootenay East.

J. Thornthwaite: Jane Thornthwaite, North Vancouver– Seymour.

P. Pimm: Pat Pimm. I'm the MLA for Peace River North.

D. Hayer: Good morning. I'm Dave Hayer, MLA for Surrey-Tynehead, and you're actually visiting Surrey-Tynehead. Welcome to the Surrey-Tynehead constituency.

D. Donaldson (Deputy Chair): Hello. Good morning. Doug Donaldson, Deputy Chair of the committee, MLA for Stikine, and I live in Hazelton in the northwest part of the province.

B. Ralston: Bruce Ralston, Surrey-Whalley.

M. Elmore: Good morning. Mable Elmore, MLA for Vancouver-Kensington.

B. Routley: Good morning. Bill Routley, MLA for Cowichan Valley.

R. Howard (Chair): Thank you, Members.

Also joining us today, I am pleased to introduce our Clerk, Susan Sourial. Also with us is Arlene Carlson, who is staffing the registration desk at the back of the room, and we have Hansard Services staff, Michael Baer and Monique Goffinet Miller, who will record and prepare the written transcript of this meeting.

[0905]

With that, I'd like to call our first witness…. Actually, before I get to that, if the committee would indulge. We have a couple of…. You'll see on the witness list this
[ Page 1520 ]
morning that we had a gap at 10:50, and then we've had a withdrawal from the human early learning partnership, but we have somebody who has walked in — a Mr. Robert Chomiak, a screenwriter who would like to present to us this morning. So if it pleases the committee, at 10:50 we will insert Robert Chomiak. Is that okay with you, Robert?

R. Chomiak: Yes, thank you.

R. Howard (Chair): Excellent.

With that, I would like to call our first witness: Jon Garson from the British Columbia Chamber of Commerce. Welcome, Jon.

J. Garson: Good morning.

R. Howard (Chair): As you're getting set up, you may know you've got 15 minutes. At about ten minutes, I'll give you a heads-up, and you can stop for questions or go straight through — your choice. Microphone is yours.

Presentations

J. Garson: Good morning. My name is Jon Garson. I'm the vice-president, policy development, for the B.C. Chamber of Commerce. I do bring apologies from John Winter, my president and CEO, who traditionally makes this presentation on our behalf, but he has had some travel issues delaying him on his return from Vancouver Island.

On behalf of the B.C. chamber, we would like to thank you for the opportunity to present the views of our membership. The B.C. chamber is the largest and broadest-based business community in the province. We represent, collectively, roughly 32,000 businesses. Those businesses represent every size of business, every sector of the economy and, most importantly from our perspective, every region of the province. The scope and breadth of our membership ensure that the B.C. chamber continues to be the voice of business in B.C.

As was mentioned by the Chair in his earlier comments, it is pretty clear that the global economic situation is extremely fragile. Whether it's the continued challenges facing our neighbours to the south or the ongoing crisis that is threatening the very future of the eurozone, the global uncertainty is a direct threat to the economic prosperity of a small open trading jurisdiction such as British Columbia.

It is in this context that we would like to congratulate the B.C. government on its jobs plan. The chamber welcomes the plan as a key element in our ability to drive growth in our key export sectors and to our ability to attract new investment, both of which represent the all-important new dollar.

This plan includes a number of chamber recommendations and builds upon our competitive advantages, and we will continue to monitor the progress of the commitments and recommendations of the plan to ensure that they are being met and are in keeping with the needs of the economy.

One area that the plan does not address — and which will have a negative impact on exports, job creation and investments — is the decision to go back to the PST. The chamber, as I'm sure you are all aware, was a leading proponent of the HST and was therefore very disappointed with the referendum result. We believe the result was the wrong one for British Columbia's economic future but accept the fact that the public have spoken on this issue.

The challenge that the decision to revert to the PST will have on our economy will be significant, but these impacts will be made all the more acute by not only ditching the HST but actually compounding the mistake by going back to the PST as it was before the HST. In this light, the chamber welcomes the commitment by the province to undertake a review of B.C.'s tax system. While the chamber will be an active participant in this process, we are concerned that this commitment is intended to provide recommendations to feed into the 2012 budget.

Given the complexity of the issues involved and the sense of hostility the public have clearly demonstrated towards significant tax changes being introduced without significant public consultation, the chamber can only draw the conclusion that the changes that will result from this process will largely be administrative in nature and will not address the challenging questions of the nature, distribution, overlapping tax jurisdictions that are critical to our ability to design a tax system that is sustainable, competitive and efficient while also attracting investment and allowing the private sector to create jobs.

In that vein as well, we would like to make a recommendation that the government continue through with its already budgeted tax cuts. We have in the 2011 budget a tax cut proposal that will take the small business tax cut effectively to zero. That is something that our members have been very supportive of, and we would like to see that carried through into Budget 2012.

The chamber also believes that the debate over the HST showed that there is a fundamental disconnect between the public and their tax system. During the debate British Columbians continually stated that one of the reasons they disagreed with the HST was the fact that they felt taxed to death. Yet when we look at some of the core tax rates in B.C., both the personal and business rates, B.C. is one of the most competitive jurisdictions in North America. Why such a disconnect?

One of the reasons for this disconnect, in our opinion, is the myriad of taxes, charges, fees levied by a variety of levels of government, to say nothing of ICBC, TransLink, B.C. Ferries and B.C. Hydro. The chamber believes it is now time for a grown-up debate about how we are taxed.
[ Page 1521 ]
The chamber believes that now is the time for a comprehensive dialogue to be launched to address these issues from the perspective of all levels of government.

The external pressures facing B.C.'s economy are worrying in and of themselves, and when they are added to the provincial fiscal situation outlined in the first quarterly report, they become an area of serious concern to our members. The chamber has been consistent in presentations and public comments.

[0910]

Government's primary role as stewards of the public purse must be developing sound fiscal policy underscored by balanced budgets. This is the foundation upon which successful economies and sustainable social programs are built.

It should be noted that during the recent economic recession, B.C. fared better than virtually any jurisdiction in North America. This was not the result of decisions taken after the bottom fell out of the global economy, although many of the stimulus measures were very helpful. Rather, it was B.C.'s ability to weather the storm better than any other jurisdiction, allowing us to enter the recession later, suffer less and emerge stronger with the result of tough decisions taken over the last decade that have provided us an enviable fiscal strength that has protected us somewhat from the global downturn.

As such, returning to balanced budgets must be the focus of Budget 2012. This was difficult before the decision to scrap HST. It has become incredibly difficult as we now have to address the costs of returning to the PST system.

The cost of returning to PST will be significant — $2.3 billion over three years. This will not only greatly increase the deficit over the next two years, thereby increasing the debt load we leave to our children, but we'll also see a $152 million surplus in 2013 turn into a $458 million deficit in that same year.

The chamber believes it is critical that government make every effort to ensure that they meet their legislated target of returning to balanced budgets by 2013-2014. To do this will require tough decisions. The chamber believes that as we look to balance the need to return to balanced budgets with the need for a stronger economy, it is critical that we look to savings rather than tax increases to achieve this goal.

While the chamber recognizes that much of the current funding goes towards maintaining essential services, the current fiscal reality has highlighted the need for all spending to have measurable outcomes and avoid unsustainable situations that both increase the deficit and contribute to provincial debts.

While the chamber welcomes the budget management measures introduced in Budget 2010, it will hold spending to 2 percent increases. In our opinion, this does not go far enough to bridge the gap between revenue and expenses.

We saw with the last round of spending cuts a significant degree of hostility from many who felt the process was rather arbitrary and from the public, who saw valued services and programs reduce or disappear with little to no consultation. The chamber therefore recommends that government undertake a transparent and public review of all direct program spending and operating costs to determine the cost-effectiveness of government spending with a view to reducing or eliminating spending commitments that are found to be ineffective or duplicative.

As we look to move forward as an economy, there are several other areas that the chamber believes require government attention. Many of these we have far more detailed in the written submission that we'll be providing to you. So we'll go through them relatively quickly right now.

For several years now our members have been telling us that in many communities the single biggest impediment to their success and growth is the role of local or regional government. We would like to make it clear that this is not universal. Many communities are doing an excellent job of working with their business community to foster healthy relationships and vibrant communities. I think, actually, just as an aside, that the community we're in right now is probably a good example of one that's doing the right thing in trying to grow a healthy economy.

However, as always, a few bad apples are spoiling the bunch. In this regard, the chamber would like to congratulate the government with their commitment to move ahead with the creation of the municipal auditor general in this fall sitting. This office will bring much needed additional transparency and accountability to local government decision-making and budgeting while also providing best practices and advice to enhance capacity at the local government level.

In addition, our members are delighted — it's not often the chamber is delighted, but in this case we're delighted — with the commitment from the provincial government to conduct a review of the property tax system. Business in virtually every community in the province is taxed at levels far beyond their consumption of services. This is compounded by the fact that the property tax bears no relation to profitability and, therefore, their businesses' ability to pay — or the individual residential taxpayer.

The chamber recognizes that local government face significant cost pressures with essentially only property tax with which to pay for the services and infrastructure their communities want. This issue will become significantly more challenging, given the infrastructure challenge that is going to become acute in the coming years. Whether it's sewage or water treatment, waste disposal or transportation investments, we are already seeing the challenge that is presenting to communities in terms of their increased costs to be borne by the residential taxpayers and the business taxpayers.
[ Page 1522 ]

As we look at this challenge and what it will mean for our members and for taxpayers in general, we are struck by the fact that there is no structure in place to either fully understand the scope of the challenge or to work collaboratively on solutions.

As such, the chamber recommends that the government create a Premier's council on municipal infrastructure to undertake an assessment of the scale of the infrastructure challenge facing communities and work with all stakeholders to determine how we continue building on our economic capacity, further strengthening the environment for infrastructure investment, and increase accountability to the taxpayer.

One other area the chamber would like to touch on very briefly with regards to local government is the issue of business licensing. This is an area where we have seen a level of intransigence on local government's part. We have had a number of areas that have had what are called intermunicipal business licences for some time. The capital regional district is a good example.

[0915]

The province, under the leadership of the ministry at the time, undertook a pilot project in the Okanagan-Similkameen that proved a success in every measure, in terms of revenue return to local governments and in terms of the number of businesses that utilized the intermunicipal business licence to register themselves where they had never been registered before. Yet since that pilot project, we have seen no region come forward after the government's request to entertain setting up another area where an intermunicipal business licence would operate.

We were very pleased to see that included in the jobs plan — a commitment to continue working with municipalities. In this regard, we don't see what would be any different than the process that has already been in place before, which is continuing to try and encourage municipalities. The chamber therefore recommends that the province step in and create a provincial business licensing system.

There are a number of other areas the chamber would traditionally make comment on — debt and regulation, as examples. They're not included in this oral presentation but are included in our fuller presentation because from our perspective we wanted to focus on what our members are telling us as the two primary areas of concern for them: a return to balanced budgets and fiscal prudence, and continued reform and improvements to local government's role in terms of economic development and our future economic prosperity.

With that, I thank you for your time.

R. Howard (Chair): Thanks, Jon. Good timing. We have a couple of questions.

B. Ralston: I'm sorry that John Winter isn't here. You mentioned that the position of the chamber is that the small business tax reduction down to zero be implemented. But I'm told…. I'm giving a quote here from an interview that Mr. Winter did on radio where he said: "I'm not so sure getting down to a zero tax rate is really the right place for business in British Columbia at any rate. I think we should all be taxpayers and contributing to the economy."

So as I said, I regret that he's not here to explain it, but can you clarify that remark by Mr. Winter, then?

J. Garson: No, I hadn't actually heard that remark. I think in terms of being contributors to the economy, small businesses do that in many ways beyond simply the fact that they would be taxed. Many small businesses are extremely stretched. It's a difficult proposition to establish a small business and get it up and running and successful. Having a zero tax rate allows that small business to begin to get some traction in its community. It will then, in the vast majority of cases, hire workers. It will create jobs. We all know how important the small business sector is to job creation in the province of B.C.

I think the comment from John in terms of "we should all be taxpayers…." As I said, I hadn't heard that, but I think small business generates significant tax revenue for the province, and I think we need to recognize that in difficult economic circumstances, having a situation where we do everything we can to encourage small business growth is good for us collectively as a province.

Just one other quick point on that as well. The other side to this is that this is a budgeted commitment. I think it's important for the business community to have certainty around the fact that when government makes budget commitments, unless there are very exceptional circumstances as to why they should be repealed or moved away from, then it's incumbent upon government to carry through on its budget commitments.

J. Thornthwaite: Thank you very much for your presentation. I'm just wondering if you had read the Saturday Sun — "Avoiding the federal HST penalty," by David Douglas Robertson. He had some recommendations, but I'll just pinpoint the one that I think that you said: "Create an impartial provincial fair tax commission." Is that kind of what you were thinking about when you mentioned your recommendation?

J. Garson: Yeah, I believe…. Actually, I'm one of the few people who read the Hansards, I'm sure, that come out of these committee meetings. I think it was Richard Rees from one of the — I always forget which — accountancy organizations who touched on the same point. Our members haven't made a specific commitment or recommendation with regards to the process going forward on PST. We are undertaking a consultation process with them. For those who are unaware, we don't tend to make policy commitments that are not endorsed by our membership.
[ Page 1523 ]

So I think that's something that we'll be looking at very seriously. As a structure to look at that issue, that probably works as well as anything else.

R. Howard (Chair): Time for one last, quick one.

D. Donaldson (Deputy Chair): Thanks for the presentation. I'm sorry I don't have the recommendations in front of me to review, but I want to ask a question about one of them. You mentioned concern from the chamber about ineffective spending by government. You went on to talk about the municipal auditor general and that there were only a few bad apples in the bunch around municipalities and your concerns with the way they're spending tax dollars.

So I'm curious. Would it not be more effective to address a few bad apples rather than set up an entire organization to deal with the ones that actually are doing a good job? I mean, the municipal auditor general would be millions of dollars, so I would be thinking that if you're concerned about ineffective spending, wouldn't it be better to take a position just to address the few municipalities that you say are the few bad apples?

[0920]

J. Garson: It would, but there's no mechanism with which to do that at this point. We attended UBCM over the last week, and we certainly heard…. But as an example, the report that the B.C. Auditor General issued just last week with regards to the B.C. government — there is no mechanism in place right now for reports such as that to be issued about a local government.

Our perspective is that from the initial standing point, there needs to be a greater degree of transparency with regards to how these things work — not just as the current auditing process is for local governments right now, "Yes, you've reported how you spent the money correctly" — that it's actually incumbent upon this level of government, which is the only taxing level of government in B.C. that is not subject to independent third-party audit, to have someone go in and say, "You did the right thing. Your outcomes were achievable. You spent the money wisely" — not just that you reported how you spent it.

If there was a process in place to address those few bad apples, we wouldn't need a municipal auditor general. We need a municipal auditor general because no process exists right now.

R. Howard (Chair): Thanks, Jon. We have run you out of time. Appreciate you taking the time to come out this morning and present to us.

Next up we have FortisBC — David Bodnar. Good morning, David. As you know, you've got 15 minutes. At about ten I'll give you a heads-up, if I can, and you can take some questions or go straight through — your choice.

D. Bodnar: You'll give me the hook. Actually, I'd encourage questions. Thank you.

Mr. Chair and committee members, my name is David Bodnar. I am the director of government relations for FortisBC. I'd like to thank you for the invitation to speak today. The recommendations that I hope to be making here are, I believe, aligned with the goals of government in terms of trying to stimulate economic growth, jobs, private sector investment, and customer affordability around energy and, by and large, are supported through our research and discussions relative to our customers.

To provide you with a little bit of an introduction, FortisBC has been in operation under one name or another for over 100 years in this province. We deliver — perhaps surprisingly to a number of folks — 20 percent of the total amount of energy that is delivered in British Columbia, to 1.1 million customers in 135 communities. We also employ 2,000 British Columbians across the province.

We are a Canadian-owned subsidiary of Fortis Inc., which is headquartered in St. John's, Newfoundland. They are the largest investor-owned utility in Canada, with over $12 billion in assets, of which about $6.6 billion are here and invested in British Columbia. As most of you will know, we deliver natural gas, electricity in the South Okanagan and Kootenay region, and integrated energy solutions. Natural gas, as some of you will know, has been used, actually since the mid-'90s, in transportation. We have embarked on a biomethane strategy and over the last number of years have expanded our energy footprint to include geo-exchange and the use of waste heat.

We recognize the government's leadership around economic recovery, trying to create jobs, stimulate investment, and fostering the development of technology and innovation. To that end, what I wanted to do was to just talk about a couple of things that we have announced recently that some of you may be aware of and that are aligned with these objectives.

First off, on January 1 of this upcoming year, 2012, we are repatriating our customer care services that have been located out of province for the last decade. That decision is going to drive the addition of 300 jobs in the province. One hundred of those will be in Prince George, and a further 200 will be located in our new Burnaby operations centre.

We have just received a final report on our Mount Hayes liquefied natural gas plant, on central Vancouver Island, near Ladysmith. We originally projected that the economic value of that $200 million project would be in the neighbourhood of $50 million. Our final report has demonstrated that, in fact, that project — a three-year project in the advance work — has left over $70 million in the Vancouver Island economy. So no small impact on the region, going forward.
[ Page 1524 ]

We partner with local technology companies, particularly in looking at new energy solutions for the transportation sector.

[0925]

We recently announced — there is an attachment to the handout — an opportunity that we have realized in partnership with Vedder Transport out of Abbotsford — the largest independently owned trucking company in British Columbia — and the use of Westport technology engines, to the point where Vedder is investing and will be receiving 50 liquefied natural gas plants for their dedicated fleet in hauling goods to the port of British Columbia.

Last year we announced, in partnership with Waste Management, a 100-truck-fleet deal with liquefied natural gas — so using clean-burning, affordable natural gas for the transportation sector. We are also investing in natural gas refueling infrastructure. Very few companies in North America are in a position to do that, so we're expanding our footprint in terms of getting into refueling.

The other element…. Some of our members here will be well aware of our investment in the Kootenay region around the Waneta dam project that is, in total, a $900 million investment in partnership with the Columbia Basin Trust and Columbia Power Corp. Our investment in that project is $450 million, and that is going to leave untold millions in that region in terms of jobs, investment and supplies of goods and services.

In terms of recommendations for the standing committee, I would like to encourage the private investment in public energy systems. Public-private collaboration and investment will help to develop integrated energy systems with different public buildings. We have had some success in working with school districts. In particular, I have in your package an example with Delta schools.

We are working with hospitals in the Lower Mainland and across the province, again, to augment what would normally be capital spending by school districts, hospitals and government alike, and encourage our investment in partnership with them to reduce capital costs and allow them to redirect funds to their customers and clients.

We believe that public-private collaboration will deliver value in optimizing private investment. It will, likewise, without losing sight of emission reductions, which is still I think an important element to try to achieve…. It will negate the need for government funding in these types of projects.

What we are looking for in terms of our recommendations is to see the provincial government look at removing barriers to private sector investment. By saying that, I mean speeding up decision-making — an example, in terms of regulatory processes, would ensure that we have a fair, reasonable, timely and predictable regulatory outcome and process. Also, perhaps look at government's treatment of financial private investment to ensure that those sorts of things don't end up sticking on the books and being a challenge for government.

I mentioned the Delta school district. We have just completed work on 19 schools, so it has saved that school district money. We have taken an opportunity to use government incentive money, PSECA funds, to transform 19 schools, putting high-efficiency energy systems in all 19 of them, 11 of them with geo-exchange and a further eight using high-efficiency natural gas technology. It's saving that school district millions of dollars. We have another six school districts that we are looking at right now that are interested in partnering with us.

The other opportunity around this is looking at remote communities. There have been a number of discussions of late from government, talking about trying to get remote communities that are not on an existing energy grid to get off diesel gen sets, and we feel further that there's an opportunity with liquefied natural gas to reduce their energy costs, get a small community grid in place and reduce their environmental footprint.

The other recommendation that I'm going to make is to support the natural gas vehicle programs in British Columbia. We believe that there are going to be a number of technologies that will be applicable to the transportation sector. We are very bullish on natural gas, whether it is CNG, compressed natural gas, or liquefied natural gas. Obviously, for certain sectors, electric vehicles, biofuel vehicles and other as yet unproven technologies will enter the market.

But we think we have an opportunity, in particular right now, to address some real concerns with the medium- to heavy-duty trucks, municipal fleets, transport fleets, where electricity is just not a viable energy option.

[0930]

Natural gas for vehicles. About 39 percent of the total emissions in British Columbia come from the transportation sector. It's a huge obstacle for British Columbia to tackle. We have also seen the price at the pump jump significantly over the last 18 months, so the cost of transportation — affordable transportation — the cost of goods to market, has increased dramatically and puts pressure on every British Columbian.

We believe that natural gas is ideally suited to deliver economic benefits and also sustain energy security in British Columbia. It will reduce our reliance on imported energy from other provinces and other jurisdictions. Ironically, it will get British Columbia back into a foothold and a position that we held in the mid-'90s when British Columbia was a leader in clean transportation technology in North America. We have seen that slip over the last two decades. It's an opportunity to get that back and to engage the technology leaders that are here in this province.
[ Page 1525 ]

I won't go through all of the benefits of transportation but suffice it to say that there are other opportunities around incenting the natural gas fleet, the emerging natural gas fleet, that do not involve financial incentives at all. One would be access to HOV lanes — so encourage those that are on clean technology vehicles, to speed up their transportation. For those vehicles that are dedicated to moving goods to ports, front-of-line access in ports. Encourage them if they're on clean energy to be able to get to the front of the line.

In addition to that we are looking at, in particular, the B.C. Ferry fleet — huge dedicated vehicle fleet. They spend about $120 million a year. We believe that by switching to liquefied natural gas and using British Columbia technology they can reduce their fuel costs upwards of 50 percent and likewise reduce their emissions. We can only imagine what impact that might have on the tourism sector and, again, moving of costs of goods to coastal communities.

I think, with that, I would like to conclude my presentation and welcome questions. Thank you.

R. Howard (Chair): We have a long list.

P. Pimm: Thank you, David, for your presentation. I'm glad I'm not the only person that thinks LNG is going to be good for our province. I see here that you show that 39 percent of the provincial emissions are due to the transportation industry. What is the single best thing that the government can do to help you get infrastructure in place?

D. Bodnar: Well, I think one of it is the refuelling opportunity. We've traditionally been a pipes and wires company, and other technology companies that have been in the refuelling business have exited the marketplace. So what we are trying to do is invest our own funds in refuelling and also investing new funds in being able to get, for example, LNG, which is an appropriate fuel for the long-haul trucks, to the market. We have an opportunity with both our refuelling tank, if you like, in Delta and our new facility, which I mentioned, in Ladysmith. We have an opportunity to get that fuel into the mix, but they need refuelling stations, and we're willing to invest in those stations.

Also, if you've got a large anchor customer, if you like, like the Vedders of the world, like some of the trash-hauling companies, at some point you can open that opportunity up to other, smaller fleets.

B. Ralston: I note that you mentioned again the customer contact centres. Last year we heard that you were returning those jobs from overseas and that you'd work with the union to create those jobs. So I think congratulations are in order there.

I did have a question about the conversion to what you mentioned are base fleet vehicles, which you identify as a good opportunity. What would be the cost per vehicle approximately to convert to natural gas fuel?

D. Bodnar: On the large trucks the conversion incremental capital cost is about $50,000 per unit. That can be a barrier. Folks like Vedder and Waste Management have seen that they can recoup that investment within two years. But we have been willing to, under energy efficiency and conservation methodology, see if we can help to eliminate that barrier. But I suggest that that's incentive. Over time, as it is proven that this is a viable option for the transportation sector, we would remove those incentives, and people would see that they can, from their operating and maintenance cost reductions, eliminate that barrier.

[0935]

D. Hayer: Thank you very much, David. You have a very large office in my riding on Fraser Highway and 168th. I have a question. How many people work in there, and what's the long-term plan for that?

Also, have you talked to Surrey school district about the same type of program you are doing in Delta for thermal energy conversion? If they would convert, what type of savings would they see on their budget, and how much would it cost them to do that project?

D. Bodnar: Sure. We have a permanent head office footprint here in Surrey. When we first opened that office up in 2000 we had about 450 employees there. We are now approximating 600 to 700 employees. That office is not going away. We own the facility, and it will be a permanent fixture here.

In terms of school districts, we have been talking to all the school districts across the province and trying to use the model that we deployed with Delta school district as an example. The amount of savings is relative to the amount of upgrades. So the age of the buildings…. Some of those retrofits are easy; some of them are harder.

The opportunity with Delta and other school districts is if we can take the easy projects and the hard projects under our regulated construct — and we're the first jurisdiction in Canada to have integrated energy put into a regulated construct that's overseen by the B.C. Utilities Commission — and blend the total cost, thus eliminating their upfront capital costs. There's an opportunity with PSECA funding to have government form a partnership as well. It is dependent on the size and scope of the project.

I should say that it's a competitive marketplace. We don't hold sole proprietorship over that opportunity. There are other companies that compete in that energy space.

R. Howard (Chair): Thank you, David. We've run you out of time. We've left myself and MLAs Thornthwaite
[ Page 1526 ]
and Donaldson on the list. We'll have to catch up with you after, but I appreciate your taking the time.

D. Bodnar: I appreciate that, and I'd welcome any comments directly to my office, or further engagement would be great. Thank you very much for your time.

R. Howard (Chair): Next up we have Canadian Sport Centre Pacific — Wendy Pattenden. Welcome, Wendy. As you probably know, you've got 15 minutes. At about ten I'll give you a heads-up.

W. Pattenden: Okay, excellent, thank you. Good morning, everyone. My name is Wendy Pattenden. I'm the chief executive officer for the Canadian Sport Centre Pacific. We're a not-for-profit organization. We have three campus locations. Our headquarters are in Victoria. We have a secondary campus in Whistler and, as well, one here in Vancouver, in the Lower Mainland.

Our job is to work with high-performance athletes for Canada, to help Canada win more medals. So I have a fun job, to say the least.

I would like to start by saying thank you for your continued investment in sport. The sport and arts legacy fund speaks volumes to this government's commitment to ensure that B.C. leads the nation as a culture that values sport excellence and, most importantly, sport as a vehicle for health promotion and prevention. A strong and vibrant community sport program is an important element in community-building and participation in sport. It is a critical tool for building healthy families and healthy communities for British Columbia.

As we look to the future, to help build a long-lasting sports system that supports our communities from the playground to the podium, the evolution of the sport and arts legacy fund into base funding is critical for the province of B.C. By doing so, that would really cement an enduring legacy of the 2010 games.

Speaking of those games, clearly they showed us how hosting the world enabled us to realize the power of sport. We experienced a new era of sport in our homes, huddled over our TVs, watching those performances by Canada's athletes — also, all the citizens celebrating in the streets.

Sport has the power to unite communities and break down social barriers. Sport and sport hosting have great economic benefit, as we've seen here in B.C., and sport has the power to inspire people to pursue excellence and to live a healthier lifestyle.

We believe that high-performance sport is a key part of this continuum. Our Olympic and Paralympic athletes are vivid examples of excellence, and I am certain many dreams were born in young Canadians during the 2010 games. As such, it is paramount that Canadian Sport Centre Pacific be armed to capitalize on the momentum built by those games and to carry that forward to the upcoming games in London in 2012, Sochi in 2014, and beyond.

Just to give you an example of our team and how we've planned to build on that success, in Beijing in 2008 summer sports, British Columbia comprised 40 percent of the Canadian team and won 40 percent of Canada's medals. For London our target is 50 percent to come from British Columbia. Just think about that for a minute in terms of our population base of roughly, I believe, 13 percent. We are clearly in British Columbia playing, as I call it, above our weight — right? — if we're that percent of the population and we're going to go after 50 percent of Canada's medals.

[0940]

But in order to do that, we have to have outstanding people, programs and places. I believe, through Canadian Sport Centre, we do have the people and the programs. Where we're falling a little short is on the places component, which is really facilities. In terms of that, we need world-class training environments. So really, the time is now to ensure that we create this lasting legacy of inspiration for British Columbians and Canadians alike.

B.C. — our winter sport athletes currently have to travel around the world in search of snow through the summer months, due to the limited access to sport-specific amenities in Canada. We could do something really creative here. There's a need for priority, affordable access to dedicated sport-specific training facilities near our winter sport training hub in Whistler.

What I'm talking about there is putting in what we call a dry-land tech centre — so an indoor technical training facility where you'd have the bowls, the rails, the bumps, the jumps, all of that — for our winter sports right in Whistler so they're not having to travel all around the world.

Right now we're in the midst of putting together a feasibility study as to what that would cost. So really, I'm here to talk about that and request support for that in the coming years.

Ourselves, with Own the Podium, have identified this need to augment and complement the existing facilities we have in Whistler. The goal is to set the standard for all-weather, sport-specific winter sport training in Canada that will give our athletes competing in extreme winter sports the edge. Currently the two national teams that train in Whistler are snowboard and freestyle, so they would really access this. As well, this would be a facility that the public and the youth in that region would support.

Participation in sport continues to increase, thanks to the inspiration born out of the games. As the custodians of the sports system, it is our job to ensure everyone has a place to play, a way to get in the game. So as the children of 2010 are inspired to pursue their own pathway to sports success, we are helping build complete champions through the Ignite program.
[ Page 1527 ]

I spoke about people, programs and places. The Ignite program is a new, innovative program that we've developed that really works on physical literacy for those in the performance pathway. It's geared at the ages of 14 to 17, to develop a well-rounded foundation based on explosive power, balance, strength — you know, all those physical literacy areas. This program was built by our strengthening, conditioning and physiology experts, all of whom have earned master's and doctorate degrees in their respective field.

The Ignite athletes will benefit from this athletic training as well as nutritional consultations, mental performance skills — everything they need to prepare them to compete against the world. But we're doing it at a younger age. It's really that next generation we're talking about.

As well, we have a brand-new sport school program that we've been piloting in Victoria and Kelowna this year. This also fills a key gap. It's an existing education and high-performance program where the athletes actually go to school in the morning, at their local school, and then we bring them into our facility in the afternoon, where they run the Ignite program but, as well, learn about performance. They get high school credits for that in the afternoon. So really, this puts them on par with our international peers.

I've been around the world looking at other existing high-performance sports systems. The one that we've had a real key gap in British Columbia would be a formal sports school system for that type of training, because really, what ends up happening is they're trying to excel in their sport and their academics, and one of them has to drop off. So without something like this in place, we really are at a disadvantage. That's a new program, like I say, that we're piloting and that we'd really like to see expanded around the province, in every region.

As well, ensuring all parts of the province have access to the sport continuum as part of what we do, in partnership with the B.C. Sport Alliance. Together with 2010 Legacies Now, Sport B.C. and B.C. Games, we deliver programs for everyone in B.C. via leagues, clubs, schools, community centres and provincial sport organization programs for that high-performance pathway.

The B.C. Sport Alliance believes organized sport and physical activity need to be more closely aligned with improved health and social outcomes, so the alliance partners have been working together with the province to reposition the sports system, maximize strengths that exist and link sport to healthy-living outcomes.

With the recent announcement of the interim CEO of the B.C. sport agency, Cathy Priestner-Allinger, the Canadian Sport Centre Pacific looks forward to the dawn of a new era for sport here in British Columbia. British Columbia is a leader in Canada when it comes to recognizing the power of sport and investing in a culture of excellence.

Thank you for your continued support for sport. Together we will continue to help athletes win medals for Canada, inspire our citizens to use sport as a vehicle for health and the pursuit of excellence in their own lives, and build vibrant communities from the ground up through sport for life.

R. Howard (Chair): Excellent. Thank you, Wendy. We have a question.

[0945]

M. Elmore: Thanks for your presentation, and congratulations, also, in terms of the success of the program. We certainly see the results.

I'm interested to hear you mention that there's need for more sports infrastructure. You mentioned the…. Besides the all-season indoor technical training facility in Whistler, are there other recommendations you have?

Also, just a follow-up, as well, in terms of the formal sport school that's being piloted, could you talk about which community is involved in that?

W. Pattenden: For the sport school, we're piloting it right now in Victoria and Kelowna, and we're testing it because we thought we should do one in the region and, as well, in Victoria. It's very successful. We're just going to be doing the first survey, sort of response with the parents. I'm actually meeting with the parents in Victoria next week.

Really incredible. Like, I know for myself, I was an athlete. It was tough to get through school, especially if you're a winter sport athlete. I have three children that have all been on the national team. My son played Junior A hockey. It is really important that they can balance the academics and sports, so they're not having to choose one over the other. Like I say, that is an advantage the rest of the world has over us — a competitive advantage that we need to change.

In terms of the facilities, I selected the Whistler one. I mean, there are other facility needs around the province for both participation and performance. That one was a pure technical one for high performance that I know will keep us as the number one nation in winter sports. So that's the one that I selected, but certainly, I can provide you with a list. We have a list with our PacificSport Centres of all the facility needs in the province.

J. Thornthwaite: Thank you very much for your presentation. My question is also about the sport school. How does that relate, then, because I know that other school districts have sports academies and high performance? Are you taking the kids that have already made, say, a high-performance team? Or are you generating the potential for those kids to make that team?
[ Page 1528 ]

W. Pattenden: Right. No, excellent question. We did a comprehensive report about a year and a half ago on all those current sport schools — what people call sport schools — in the province of British Columbia. There were 114 programs — very different, all of them. They weren't targeted at what I would call the pure high-performance athlete. They were open to anyone, which is fantastic.

Our program is targeted at the athletes that we consider have potential for the podium — all right? But as well, the Ignite program that I spoke about is open to everyone. It's a bit of a hybrid approach, but the idea is it's for those who are serious about performance. They come into the sport school, and you can get the academic needs taken care of close to home, so they're not having to move all around the province or move to Vancouver. You know, if they live in the region, we want them in the region training at home, close to home, especially at those pivotal teenage years — right? It is really important.

Again, we've got a comprehensive report that has it, and it was sort of the best brain trust together to design this program. It doesn't mean that in every region it'll be exactly the same. So there are some nuances to the program.

Sorry. You had a second question there? There was the sport school, and was there…? Did I answer your question there on that?

J. Thornthwaite: Yeah, I was just…. You said it was a hybrid, and I just was wondering how you identify which kids are the ones that are going to go if you don't know that they're in your program yet.

W. Pattenden: They're identified through the provincial sport organization. Through their sport, we get the list — right? — and then we invite them to join the sport school.

R. Howard (Chair): Time for one last quick one.

D. Hayer: Wendy, thank you very much for a very good presentation. The students that participate in this program — are they from all different backgrounds and all different income levels? Or are they more difficult for the people with a low income or middle income to participate in? Do you have any information on that?

W. Pattenden: Yes. No, they're from all over — all different backgrounds. It's a subsidized program — right? — so the cost is very low. In the pilot program, to give you an example, the total cost for the entire year is $1,000. If there's an athlete that can't afford that, they can talk to us about that, and we will help them, because it is about having the best athletes in the program. We don't want economic means to play a role in the fact that they can't participate.

Now, you compare that to the current sport schools, which are all a fee-for-service right now and that are much higher. I know, for example…. My daughter went to the Delta Hockey Academy, and it's $4,000 to $5,000 a year, so it's a lot more. This is a subsidized program for athletes.

R. Howard (Chair): Excellent. Thank you, Wendy. That's all the questions we have. We really appreciate your coming forward this morning. If you're going to present the list, the list of facilities…

W. Pattenden: Yeah. I will do that now.

R. Howard (Chair): …you can do that to myself or to the committee, and the Clerk of the committee will make sure it gets distributed.

[0950]

Now, committee, next up on our list we had Colin Sanderson. Colin isn't here yet, so we thought we'd move forward to somebody who walked in, and we happen to have a spot for him. He did make a written presentation — Mr. Ron Watson.

Welcome, Ron. As you probably know, because you've been sitting there, you've got 15 minutes. At about ten I'll give you a heads-up, and you can take questions or go straight through — your choice.

R. Watson: Well, my presentation today is on health care. At first I thought I was in the wrong room, but I guess I'm not.

My background has been in health care for 40 years, from acute care to long-term care and home care, which I consider the wave of the future. I don't think we're using it enough. What I'm really concerned about is the Canada Health Act. Back in May 2009 I wrote the Prime Minister, all the Premiers across Canada and the Health Ministers. In my letter I outlined to them some of the problems in health care.

Let me give you some examples. I think we need to establish an elder abuse program in each province — I don't think that's been done — a mandatory program arranging accommodation for the elderly before they are closed. What is happening is when the places are closed or they need transfer, they have no place to go and they're separated.

Actually, the other night on the news…. I'm going to leave you this two-minute disk of some handicapped people who are being moved out of their facility. Older people do not like to be moved. They're used to their accommodation, and we need to somehow work around that.

I think the other thing in health care is that every province across Canada has some kind of operating deficit in their health system. That tells me right away that we need to review the Canada Health Act. It's never
[ Page 1529 ]
really been done since it was brought into force back in the Tommy Douglas days.

What I would like the committee to do is to consider lobbying the federal government with all the other provinces to set up a committee to review the Canada Health Act. Really, it's never been done. That's the intent of this presentation — to get this committee to discuss this with the Premier and the other Premiers across Canada to establish this.

Now, when I wrote letters to all of the Premiers across Canada, the only ones that responded to me were in the east. Nobody from the west responded. I found that disheartening. I also sent letters to 18 mayors across Canada, asking them for their support. Many of them responded but felt they couldn't really put too much effort into it because it's under the federal government.

One of the other things I said in my letter to the Prime Minister is that we need to build wellness centres for the elderly. Not only the elderly, but the young people need it too. When I was working in home care, we were planning to build a place called aging in place. Basically, this program would include all the facilities that older people need, from housing to assisted living to home care and even hospice, and a huge wellness centre. That didn't take off.

The idea basically came from Sun City, Arizona. I don't know if any of you know of Sun City, Arizona. I saw it in 1961. There were 1,000 seniors living there in one area. They didn't have cars. They ran around in scooters. Very happy people. I was down there about four years ago. It's now 100,000 people in various sections in Sun City. Their program is working. I don't know why we can't do that up here to have a place like that for the elderly.

I think another thing that we need to consider is educational facilities for doctors and nurses. I don't think that's been done enough. We need to look at doing something like that.

[0955]

One of the recommendations I made to the Prime Minister to generate income was to impose a tax on smoking and cigarette sales. That tax would be around 1 percent. That money would go directly to health care. That would eliminate deficits.

If they didn't want to consider that…. I remember when I worked in Calgary, back in the '60s, we had a user fee. It was $1.60 a day. I don't know why we can't bring a user fee back. I think it now would be around $5. That would certainly help the deficits in the hospitals. I mean, we don't get anything in this world unless we pay for it. We also did not charge people that were on minimum incomes.

Basically, this letter…. There are many other things in here that I won't mention right now. I will leave it with you. What I'm asking you is for your support to lobby, through the Premier to the Prime Minister, to set up a committee to review the Canada Health Act.

That's basically my presentation. I'll take questions.

R. Howard (Chair): Ron, thank you.

D. Donaldson (Deputy Chair): Hi. Thanks for the presentation. I look forward to the written material that you're going to provide.

Did you also say that you had written in 2009 to the Minister of Health here in B.C.?

R. Watson: Yes, I did.

D. Donaldson (Deputy Chair): I believe that would have been Minister Falcon at the time. Can you describe to me the kind of response you received?

R. Watson: I didn't get any response from him. Most of the responses I got were from the east.

D. Hayer: Ron, maybe for the committee's knowledge, you can tell them how long you've been involved in health care in Surrey and what types of different programs you've done. What type of support have you received from different governments over the last 15, 20 years that you've been involved very actively in health care, especially in Surrey and the Lower Mainland area?

R. Watson: Well, back in the '80s when I first started at Surrey and White Rock Home Care, money was difficult to get. In those days what we used to do is go into the casinos. We actually ran the casinos. At the end of the day, we received 40 percent of the take, 10 percent went to the government, and 50 percent went to the owner of the casino.

I remember the last casino…. In ten years we did that. We were able to build our own office building and buy our equipment that we needed for home care. The last day that we were in the casino — they put the slots here in Surrey — we made $100,000 in one night.

We also got money from a group called GO B.C. grants. I don't know if you all remember that. That was back in the '80s. That helped us to facilitate to build our own office building. It saved us a lot of money in rent.

The other thing that I worked on was accreditation for home care. We were the first to be accredited in British Columbia — and, actually, in the west. I think accreditation should be mandatory for all facilities, because they set standards that health organizations should meet.

I think those were some of the things that I did when I worked in home care. Home care is the wave of the future. It's cost-efficient.

The other thing that's going to come down the tube is Alzheimer's. You have no idea the wave that's going to come. That's very costly, and we should be preparing for that.

Hospice is another thing that we need to look at. I can remember back in '92 when we were planning to build a long-term-care facility, we added a hospice to it. Nobody
[ Page 1530 ]
was interested in that, but now it's starting to catch on. People that are dying don't want to be in a hospital. They want to be either at home or in a hospice setting.

If any of you get time, you should go out and see Northview Golf and Country Club. The owners of Northview, the Stewarts, built a hospice. It is a fantastic place. They built 16 beds two years ago. They've now added another 16 beds. The serenity for the person that's dying is fantastic there. If you ever get a chance, you should go out and see it.

R. Howard (Chair): Excellent. Thank you, Ron. We've run out of questions. We appreciate you showing up this morning.

Committee members, we'll jump around a bit on our list, depending on who's actually in the audience here. We have the Canadian Taxpayers Federation — Jordan Bateman.

Welcome, Jordan. As you probably know, you've got 15 minutes. At around ten I'll give you a heads-up. You can stop and take some questions or go straight through — your choice.

[1000]

J. Bateman: Thank you, Mr. Chairman, and thank you to the committee for the opportunity to present. Thank you for the time you're taking to tour the province. It's very important, this committee. It's vital to what the budget is all about, and I appreciate it. I know that there are stacks, in your constituency office, of files growing as you're out and about the province, but I appreciate you taking the time to do this.

The Canadian Taxpayers Federation — we enjoy these budget meetings because we're probably one of the few groups who come to you and ask you not to spend any money. I imagine that over the last few dates you've had many very worthwhile business cases, great ideas, updates on current programs, requests for more money come to you. But we're asking you not to spend any more money, except for one small recommendation, one small piece that we'd ask you to support.

The only thing we're asking you to increase spending on for the 2012-13 budget is a municipal auditor general. We feel this is very important. We know the legislation is being worked on as we speak, and we hope that both government and opposition will support the municipal auditor general and give the municipal auditor general the resources the office will need in order to do their work.

It's no point in just having a figurehead. We need to make sure that that individual has a small staff, solid researchers who can go in and do the work that property taxpayers are demanding.

That being said, we do want to encourage you, also, as 2013 is the deadline to balance the budget, according to the legislation. As we know, legislation can change, so we are asking that it not change. We want to see 2013 as a balanced budget. We'd prefer this year, but we understand with the HST and the other issues going on, that that will be very tricky. So 2013 at the latest we would like to see a balanced budget.

In fairness, you're very close. I mean, $458 million sounds like a lot of money out here, but when you actually look at it in the context of the $42 billion budget, it's about 1.1 percent. So if we can find spending cuts in various ministries, that 1.1 percent is doable; 1.1 percent sounds a lot more doable to me than $458 million.

We've provided you with a written submission. We have a number of recommendations in there on how to start nibbling away at that $458 million, but the truth is that the people who know those ministries best — the ministers, the senior deputy ministers and the senior staff — are the ones really in the best position to find those spending cuts to bring it into line.

I should note, it's not even a spending cut. If you reduce budgeted spending by 1.1 percent to balance the budget in 2013, you're still increasing spending year over year by $150 million, which, obviously, can flow into health care and into education — into those important things.

I will highlight kind of the model that we'd like to point out to you, which is actually Minister Collins's model in 2001. Obviously, there were some deficits in the early 2000s, and the Finance Minister of the day…. It was his job to get the government out of those deficits. He did it by reviewing essentially every government program and asking three important questions. What is government's business? How are we going to do it? And how can we do it better?

We're hoping your philosophy in this budget cycle is: what should government be doing? Should we be in that business? And can we do it better?

We look at Crown corporations' spending, for example. While subject to the House, it's not always on the front burner, the top-of-the-mind radar for MLAs. We see lots of opportunities in Crown corporations. We like the B.C. Hydro review. We certainly support the throne speech promise to do similar reviews on other Crown corporations.

Just last night we discovered that B.C. Place Stadium's roof — half a billion dollars — only has a one-year warranty. That's a concern to us as taxpayers, especially in a rainy, windy climate like Vancouver's, with a roof that's very fancy and not just any average guy can get up there and fix. We question how PavCo found themselves in that situation.

So more oversight of Crown corporations, finding out where they're spending their money, making sure that they're taking appropriate risks for taxpayers. We don't think a one-year warranty is an appropriate risk for taxpayers. That's the important thing to us.

I've prepared a written statement, a written submission to you. I don't want to take up too much of your time, because I know there are lots of great people here
[ Page 1531 ]
to talk. The recommendations are on page 7, and we'll go from there.

One other piece that I would like — it's mainly, I think, to plant a bug in your ear for next time, for the next budget cycle — is the carbon tax legislation. Obviously, that's up in 2012. We hear lots of suggestions on how to spend carbon tax money.

[1005]

Our supporters across B.C. find the carbon tax very punitive. While it certainly is revenue-neutral for government, it is not revenue-neutral for the people paying it. Just because government doesn't take in any more money doesn't mean that balances out in my pocketbook or in the pocketbook of, especially, rural interior B.C. In the Kootenays, I know, that's been a concern — the carbon tax — as well. Anything you're doing that increases energy costs makes it difficult for families.

We'd ask that instead of renewing the legislation and bringing in further increases, instead of reallocating that money to transit or keeping it revenue neutral, that you simply freeze it or roll back the carbon tax increase altogether.

We pay 50 cents a litre in gas tax in Vancouver. Those of you who live in the Kootenays get off a little bit easier than us. But 50 cents a litre is just too much to be paying in gas tax. It's hurting families. The carbon tax might be a logical place to start to cut into that.

R. Howard (Chair): Thank you, Jordan.

We have a question.

B. Bennett: Well, we have to drive further.

J. Bateman: Yeah, that's true.

B. Bennett: And we have those big trucks that are referred to as "luxury vehicles" — those three-quarter-tons that the loggers and the miners have to use to go back and forth.

J. Bateman: Not a lot of rapid transit, I understand, in the Kootenay area.

B. Bennett: Not too much rapid transit there, other than the highway system.

I'm curious about something. You didn't really mention it, but it's implicit in what the Canadian taxpayers group does.

There's almost an ideological debate in B.C. politics about whether reducing personal income taxes and corporate and small business taxes has a positive long-term impact on the economy or a negative impact on the economy. Do you have any thoughts on that?

J. Bateman: Well, we know from B.C.'s own experience — if you look at page 10 — that B.C. personal income tax was cut by 25 percent in 2001 and by 10 percent in 2007, and yet total revenue from personal income tax rose from $5½ billion in 2001-02 to $6.2 billion this year. That's despite the lower rate and a slowed global economy. So certainly, we think there is a strong indication that cutting taxes does leave money in people's pockets, does spur economic growth.

It's just common sense. If I have $50, I could give it to you. It goes to Victoria, and it does all sorts of different things. Or I can spend my $50 and go and buy some clothes for my kids — all of that sort of thing — creating jobs in my community. It goes a long way.

Obviously, the Taxpayers Federation — we're strongly in support of tax cuts. We do recognize that right now balancing the budget is job one. Get that budget balanced, and then start rolling back taxes again.

Feel free to start with the medical services premium. It drives many of our supporters absolutely crazy. It's $114 a month now for a family like mine. That's a significant tax and one that doesn't get the kind of attention it deserves.

So that would be my recommendation. Balance the budget, and then start working on that MSP.

B. Routley: Thank you for your presentation.

I wondered if your group has any comment about the dramatic increase in contractual obligations. It's the equivalent of a family going out and blowing all of their credit card debt in a massive way. We're headed towards $80 billion. I don't know whether your group has any comment on that whatsoever. If you do, if it's not in this book, what do you have to say about it?

J. Bateman: I do touch on it somewhere in here. I'll have to take a peek and find it.

Our organization is very concerned about public debt. In fact, we've relaunched the debt clock. It's currently touring in Manitoba and Saskatchewan right now. It's made its way all the way across the country. It started in Victoria and went all the way to Halifax. Now it's working its way back.

The debt that we're incurring for future generations is such an easy way out, you know. You borrow from tomorrow to pay for today. But I think it flies in the face of what any of us on a personal level want to leave for our children.

My kids are eight, four and one. I don't want to leave them with a legacy of debt when I pass on many, many years from now. I don't want them to have to worry about paying stuff on my behalf. So yeah, we are definitely concerned about the growing debt.

We're concerned about the debt in all levels of government, and we're concerned, especially, about how some of it is in the Crown corporations. The Port Mann. We're concerned about where…. It's not hidden, because it's all publicly disclosed, but it's certainly kind of off government's radar.

[1010]
[ Page 1532 ]

TransLink is a great example. The mayors have requested a two-cent-a-litre gas tax. If interest rates go up, they'll be back asking for more. They're in that kind of debt problem. They're paying about $250 million — I'll have to double-check the figure — in debt servicing. It's a lot of money, and it's eating into everything else.

Yes, we're definitely concerned, and we encourage you to bring that down. We've seen that slow rise in debt-to-GDP, and we would definitely like to see that stopped.

D. Hayer: Thank you, Jordan, for your presentation.

I have one question. Many constituents ask me, and there are different answers for them…. Maybe from the Canadian Taxpayers Federation perspective you can give us the answer.

What was our tax rate in the year 2000-2001 for personal taxes, small business and corporate taxes? What are they today? Are they the highest in Canada? Are they lowest in Canada? Are we in the middle? Or do you have some position? If you don't have them here, can you give it to us in writing so I can use maybe your perspective to explain to my constituents that this is what you're saying?

Many of the people asking questions of the Finance Committee also have different views on where we are compared to the rest of Canada.

J. Bateman: My understanding is that B.C. is the middle of the pack. The Fraser Institute does Tax Freedom Day. I believe British Columbia was June 2 or so. I believe it's in the middle of…. There are provinces ahead of us; there are provinces behind us. Although, it's an imperfect model because of equalization payments and that sort of thing.

Also, one of the great graphs in the budget documents themselves…. In the appendices there's a great graph comparing B.C. taxes, property taxes, MSP — the whole range of taxes we pay — to other provinces. I actually have a document at home with that, so I can definitely forward it to your office.

D. Hayer: I would appreciate it. Just send it to the committee members, and we can keep it for the record.

J. Bateman: Sure.

M. Elmore: I'm just wondering, in terms of your recommendation on page 7 — the Crown corporation reform with regards to open ICBC to competition. Is that to compare that with other provinces? Often reports are that the rates rise, and there are some concerns around that.

I'm also interested. Does the Canadian Taxpayers Federation have a position or articulate the issue of environmental debt or ecological debt? Often that's left out of the equation when discussing the financial numbers.

J. Bateman: On the ecological debt, I would say we don't have a position on that. We're all about the numbers.

On page 22, on ICBC, you'll see an October 2011 Fraser Institute report. It found that the average auto insurance premium in B.C. was $1,113 — second in the country only to Ontario's $1,281. In fact, four of the top five provinces, as far as the cost of premiums…. Actually, three of the top four provinces with the least affordable insurance rates were provinces with government-run monopolies like ICBC.

Alberta pays less than half of what we pay in car insurance. I don't know how Alberta does it. They seem to pay less than us in everything. Alberta, Newfoundland, Nova Scotia, P.E.I., New Brunswick — those all have competitive but regulated auto insurance sectors, and they are the lowest five provinces in Canada.

Clearly, the model shows that if you regulate but allow competition, the cost to taxpayers will go down.

B. Ralston: You do mention disclosure of MLA expenses. Can you tell us why you think that's important?

J. Bateman: Well, first of all, I definitely think it's important. I, for one, don't feel like there's any hidden boogeyman in the expenses. Having seen what the comptroller general puts you folks through, I think it would be very difficult for anyone to be taking advantage of the system.

For me, it's not a gotcha thing, but it's actually another sign of accountability. As 85 MLAs, you're responsible for the overall budget. You're responsible for voting and all those different things. But your expenses, those are yours alone. If we're trusting you with a bit of our chequebook, we'd like to know from you what you're spending that money on. We think it's very relevant.

The city of Toronto is kind of the gold standard. They actually put up councillors' receipts. You can see who the mayor had dinner with, what he drank, where he went, all of those things, on a receipt.

We'd encourage you to definitely get on with that. It's been promised now for 16 or 17 months — that these accounts would be released to the public. We feel like we're kind of spinning our wheels on this. Every time I talked to the Minister of Open Government, which was Minister Cadieux until very recently…. You know: "It's coming; it's coming; it's coming." But we never seem to get across the line.

So we really want to push you folks to release those to the public. It'll be a story for a day, and then only people like me will ever check them. Sean Holman may check them as well. But the rest of the public will just feel more confident knowing that they are open to scrutiny.

[1015]

R. Howard (Chair): Thanks, Jordan. We've run you out of time. We appreciate you taking the time to come out this morning.
[ Page 1533 ]

J. Bateman: Thanks for having me.

R. Howard (Chair): Committee, we're jumping around a bit still. Some people are here. It must be a tough day for traffic out there or something. Next up, we'll skip to Robert Chomiak, screenwriter.

Robert, as you know, you've got 15 minutes. At about ten I'll give you a heads-up. You can stop and take questions or push straight through — your choice. The mike's all yours.

R. Chomiak: I would like to thank the committee for allowing me to speak today. I have not prepared a formal submission, and my talk here will be mainly anecdotal. It will probably be very short, so you'll be very thankful for that, I'm sure.

The Writers Guild of Canada was not made aware of the dates of the hearing. I'm from Vancouver, and we didn't actually know about the schedule until after the Vancouver hearing was completed. So I'm not sure if you've had anyone from the film and television industry come to do any submissions.

I'm mainly here because I'm talking about the film incentive program for B.C. There is some concern that this incentive will not be continued. I just wanted to let you know that I was involved with a feature film production called Fido during the time in 2005 when there was some talk of whether or not the tax was going to be scrapped. We were debating at the time whether the film was going to be shot in B.C. or in Ontario, and the tax credit situation was definitely a determining factor in whether or not we were going to shoot here.

Fortunately, it was continued, so we did shoot the film. It was an $11 million budget film. We shot it in Kelowna. So that is one production that would not have been shot in B.C. had it not been for the tax credit.

We also have another film that, just last month, was picked up from Alliance, so we're going to be shooting that film as well. Again, the tax credit situation is going to help determine whether or not we will be shooting again in B.C. or Ontario. That one will be a $6 million film.

So there is concern in the community because, right now, film and television have brought in over a billion dollars into this province. The U.S. figures are over a billion dollars in 2009. That was reduced to only three-quarters of a billion in 2010. So it's basically 75 percent of what it was before. The local productions, though, went from $217 million to $247 million. That was an increase of 12 percent. So we would like to be able to continue shooting productions in B.C. and having more incentives.

The other issue is a little more of a personal issue. I have a friend, a screenwriter, who is based in Vancouver but has spent probably over half of his marriage now outside of Vancouver to work. Part of the reason for that is that the screenwriter's fees, for some reason, are not included in the budget for productions. They are, I believe, in Manitoba, Saskatchewan and Ontario.

The result of that is that even though there is a B.C. production, there is no incentive for them to hire B.C. screenwriters, the reason being that they can actually get a screenwriter outside of B.C. — for example, an Ontario screenwriter. Since the Ontario screenwriter has the tax incentive, they can actually fit that into their budget. But the B.C. screenwriters don't have that as part of the calculations, so there is no incentive to hire us.

Unfortunately, in the last Writers Guild of Canada meeting that we had, a lot of the members were complaining that they've just been out of work, or they have to work out of province to be able to actually make a living. So we would like to see the screenwriters fees be calculated in the budget. That will allow us to foster even more B.C. productions as well.

That's it for my presentation today.

[1020]

R. Howard (Chair): Excellent. Thank you, Robert. We have a question.

D. Donaldson (Deputy Chair): Thanks for the presentation. We have heard from TV and film sector representatives again this year, and it's been well worth it.

I'm curious as to the situation you describe. Does the writers guild have an idea of how much that tax credit would be worth? In other words, what would it cost the province to supply that tax break to the industry — the one that's missing right now?

R. Chomiak: Yeah. I don't have the specific figures in front of me. Like I said, I didn't think I would be making a formal submission, but I can actually include those if you'd like.

D. Donaldson (Deputy Chair): If you could supply it to the committee, then we could share that information. That'd be helpful, thanks.

R. Chomiak: Sure. Okay.

R. Howard (Chair): Deadline is October 14, just so you know.

R. Chomiak: Yes, I'm aware of that. So I'll do that as soon as possible.

B. Bennett: Peter Leitch presented to us in Vancouver. Your recommendation to us, if you had one recommendation above all, would be to continue on with the film tax credit program?

R. Chomiak: Absolutely, yes.
[ Page 1534 ]

B. Bennett: I used to be a bit of a cynic on the program, and then for a year I had the film industry in my portfolio and learned the extent to which it's labour-intensive. An amazing number of people work on any film — on any production, actually. So I appreciate your presentation.

R. Chomiak: That's very encouraging to hear. Thank you very much.

M. Elmore: Thanks for your presentation, Robert. I'm also curious about your recommendation to include the screenwriter fees into, I guess, the B.C.-based productions…

R. Chomiak: That's correct.

M. Elmore: …in terms of the eligibility to receive tax breaks on that. Do you know what the other provinces are that have the screenwriter fees included?

R. Chomiak: I believe that's Manitoba, Saskatchewan and Ontario.

R. Howard (Chair): Thank you, Robert. That does it for questions. Appreciate you coming forward this morning.

We're missing our next presenter, but we do have Louella Vincent here, who would like to make a presentation. So if it please the committee, I'll ask….

Louella, would you like to come forward?

L. Vincent: Well, I hadn't planned on it, but I don't want you to be bored.

R. Howard (Chair): Yeah, must be a heck of a day out there traffic-wise.

L. Vincent: I guess so.

R. Howard (Chair): Just so you know, then, we'll have you state your name for the record. You'll have 15 minutes. At about ten, if you're still going, I'll give you a heads-up, and you can take some questions if you like.

L. Vincent: Okay. I don't know how long I'll go. I don't have anything prepared.

R. Howard (Chair): Okay.

L. Vincent: My name is Louella Vincent. I'm a Surrey resident, and I'm a caregiver at home — a caregiver of two mentally challenged adults who live in my home. As well, I work in a day program in Richmond that provides services Monday to Friday for the same kind of adults — as a way of background.

I was looking at your $43 billion budget forecast for 2011-2012 and see that for social services there's only $3.35 billion, which is 7.8 percent, budgeted for the social service sector. That's what gave me the push to come up here and talk to you.

Other than that, I was happy to just sit here and take note. Well, that's not true. I'm never quiet.

This concerns me. Given the wait-lists that we have for people waiting for services, whether they're children or adults, this does not even begin to cover the $45 million shortfall for this year. I'm just guessing on that. I don't have that in my notes in front of me.

[1025]

It gives me great concern to think that we're going forward with, yet again, not enough money in the kitty to take care of our fragile individuals that we support.

I don't know how familiar you are with social services. If it's okay, I'll give you just a brief snapshot — if that would be helpful.

Social services. We have a big scope. We don't just have mentally and physically challenged adults. We have children. We have teenagers. We have seniors. We have abused women. We have homeless people. It's a really big snapshot of the city.

We've had a lot of things going on in the newspapers talking about people being forced out of their homes, people who don't want to move. This is very close to my heart, because this is what I've done for most of my life — make sure other people's needs are met. It looks like they're not now.

I would like it very much if you could take into consideration that we are $45 million in the deficit already for looking after the people. We have a huge wait-list. We have people that don't want to move being forced to move because of CLBC's, Community Living B.C.'s, need to balance their budget.

I read that they're meeting the health and safety needs of people. What the hell does that mean — meeting the health and safety needs of people? Does that mean they had dinner today? Does that mean they're in a house? What does that mean — meeting the health and safety limits for looking after people?

You know, we're lucky. We got to choose where we wanted to live. We got to choose where we wanted to go to school. We got to choose who our friends are. We got to choose who took care of us. We get to choose what we eat. These people have very little choice, and that's not right. They're entitled to a level of happiness. Most people aren't happy, because they have no choice.

I can feel myself getting very upset, and that's not what I want to do. I want to present this in a clear and concise manner. If you give me just a second, I'll gather myself, because I don't want to do that. Thanks.

I saw this really cool film the other day, where an MLA in Alberta went and spent the day in a group home. I think that would be a fabulous idea — for all of you to go spend a day in the group home, in the seniors centre, at a day program, at a place where people are trained so that they can learn a vocation.
[ Page 1535 ]

Not everybody can work. CLBC seems to think everybody can work. It's not true. Even normal people can't all work.

I would like two things very much: if you would consider that idea to take a walk in my shoes for the day and to relook at the budget and think about what I've said and realize that this money is not going to meet the shortfall for this year. And it sure as heck isn't going to do anything for next year.

I thank you very much for listening to me.

R. Howard (Chair): Thank you, Louella. We have a question.

J. Thornthwaite: Thank you very much for your presentation. We have had quite a few presentations pertaining to CLBC during our deliberations. I just wanted to comment on your suggestion about MLAs walking a day in your shoes. Certainly, you should ask. Nobody's ever asked me.

When I get asked to do stuff like that, I jump at the opportunity. So if you've got somebody in North Vancouver that wants to ask, I'll jump at the opportunity. Sometimes when these things happen, it's because the MLAs and the elected officials actually haven't been asked.

L. Vincent: I have no doubt. I just saw the film myself.

R. Howard (Chair): Thank you. Well, I would say I have been asked, and I have done it.

L. Vincent: Have you?

R. Howard (Chair): I sure have, yeah.

L. Vincent: Would you mind telling me where?

R. Howard (Chair): Richmond.

L. Vincent: That's where I work. I didn't see you there.

R. Howard (Chair): Yeah, I visited, I think, three different group homes.

[1030]

D. Hayer: Thank you very much for your presentation. I had a question. You were talking about social services only getting 7.8 percent of the total budget, and health care and education are actually, together, getting almost 67 percent. Do you think, to keep the budget in line — because we are already running a deficit — we should transfer the funding from one program to another, or should we run even more deficits, or should we try maybe to increase some revenues some other way and then increase the funding in the programs you are saying we should increase for the seniors and also in social services?

L. Vincent: If I may be so bold, I think that you should listen to the front-line people who have been telling the government for the last 20 years what they need to do, and they have not listened. I would not want to take from Peter to give to Paul. However, there are ways to generate funding, and there are ways to keep programs in line without losing jobs, without taking from anybody else. But you need to listen to the front-line workers. They are the ones that live this every day. There's lots of documentation.

D. Hayer: Do you have any suggestions on what types of savings we can find, and where? If you have some provided….

L. Vincent: I would be happy to forward that to you before the 14th. As I say, this was totally off my cuff. But I would be willing to look in to doing that, and I will.

D. Hayer: Thank you very much for presenting, even though it was on the spot, sort of.

L. Vincent: Thank you for listening to me.

R. Howard (Chair): Thank you, Louella. Appreciate you coming forward.

Next up we have the Kwantlen Faculty Association — Joel Murray, Phillip Legg and Bob Davis. Welcome, gentlemen. As you know, you've got 15 minutes. At about ten I'll give you a heads-up, and you can stop and take some questions or go straight through — your choice. Over to you.

J. Murray: Thank you. Good morning, and welcome to Surrey. My name is Joel Murray, and I'm on the executive of the Kwantlen Faculty Association as the vice-president, grievances. In addition to representing the KFA, I'm an instructor at Kwantlen, where I've been employed for more than 11 years. I teach academic English-as-a-second-language courses.

The KFA's 800 members work at the four different campuses of Kwantlen Polytechnic University, located in Surrey, Richmond, Cloverdale and Langley. We're glad that the committee made the decision to come to Surrey and gather public input directly from citizens and organizations in this community, and we thank you for the opportunity to share our faculty association's views on what should be the priorities for the February 2012 provincial budget.

I'd like to give you a brief overview of our institution. Established by the B.C. government in 1981, Kwantlen was first a community college, then a university college and now Kwantlen Polytechnic University. I'd like to point out that Kwantlen is the only public post-secondary option in the South Fraser area west of Abbotsford. Kwantlen offers bachelor's degrees, associate degrees,
[ Page 1536 ]
diplomas, certificates, citations and trades training. We do all of this by offering over 135 programs.

We also provide over 25 services to help students with their studies. We're home to about 17,000 students who come largely from communities located south of the Fraser, but also from outside of B.C., a point which I will address later in this presentation.

One of the critical objectives of our institution is to provide students with a broad range of post-secondary education options. In addition to our university programs, we offer an extensive trades training program at our Cloverdale campus, which works closely with local and provincial employers. We offer an adult special education program and an English-as-a-second-language program. Our adult basic education program and developmental education program provide people with the opportunity to upgrade their skills, complete their high school education or secure the necessary prerequisites to enter new programs or improve their career options.

Premier Clark has stressed many times over the last several months that she sees education, both post-secondary and K-to-12, as key priorities for British Columbia. You won't get much disagreement from our members on that point. We see the transformations that are possible when learning and opportunity intersect.

[1035]

Our students, regardless of the program they're in, gain more than just knowledge or skills when they attend Kwantlen. They gain a renewed sense of self-confidence, a confidence that helps them transition to new careers in many instances but also a confidence that leads them to become more fully engaged in their communities.

Where we struggle, both as an institution and as post-secondary educators, is on the details on how to ensure that our institution and our students have all the opportunities to learn and build that confidence.

The two most significant challenges we face at Kwantlen have to do with access and affordability. We need to improve both if we want to fulfil Premier Clark's stated goal of making education a sustainable priority in B.C.'s economic and social future.

Let me touch briefly on the issue of access.

Operating grants from the province are critical funding sources for every public post-secondary institution in British Columbia. Those grants are the largest single investment that the provincial treasury makes in our institutions. What has happened over the last ten years is that operating grants have not kept pace with either basic inflationary pressures or the steady increase in the number of students who are attending our institution.

Provincewide real per-student operating grants have declined by over 8 percent since 2001. What that means at an institution like ours is that we are forced to do more with less. While we pride ourselves on being able to provide our students with the courses and services they need to be successful, our institution struggles with tighter and tighter budgets.

The casualty in all of this is the students. It is more and more difficult for them to get into courses or to receive services such as personal and career counselling. For example, students face growing waiting lists for course offerings that they need to complete their degree or want as part of a career change. They face increasing delays in accessing counselling, a service that has seen little growth in spite of increased enrolment.

The other major challenge at Kwantlen is affordability. Tuition fees for an undergraduate degree have more than doubled in the last ten years. The spike in fees may not have dented enrolment levels at our institution, but it has had a negative effect. Our students now take on much greater debt than was the case ten years ago. According to the Canadian Federation of Students, the average student graduates with a $27,000 debt.

Our students also are taking longer to complete their degree programs because with rising tuition fees, with greater debt comes the pressure to work part-time, a pressure that naturally forces a student to take less than a full course load to balance work and school commitments.

Our concern is that these pressures will, at some point, drive participation rates down, a move that we don't want to see in this province if we hope to deal effectively with the impacts of demographic shifts and looming skills shortages.

The affordability crunch has also distorted how much tuition fee revenue drives the overall revenue picture at our institution. In 2001 tuition fee revenues amounted to just over $11 million at Kwantlen. That number translated into about 13 percent of total revenue. By 2011 tuition fee revenues stood at over $44 million, a fourfold increase. Tuition fees, however, now account for over 30 percent of total revenues.

When you have shifts of that magnitude over a relatively short period of time, it begs a number of questions, like: why is the current generation of students paying a far higher portion of the cost of their education than was the case for earlier generations? At some point intergenerational equity has to find a balance, but making today's students pay a third of the costs when previously it was half that number strikes us as being profoundly out of balance.

The Premier also highlighted the importance of international education in both the throne speech and several announcements she made in September.

Kwantlen, like many universities and colleges in B.C., has a long history of opening doors to international students. It's not only good for those students, who are able to access a quality education here in B.C.; it's also good for our institution and our domestic students, who are able to engage in a diversity that comes from having international students within our classrooms.

[1040]
[ Page 1537 ]

As noted in the Kwantlen 2009-10–2011-12 Accountability Plan and Report: "Kwantlen is very aware of the importance in internationalizing its curriculum and preparing its graduates for a world driven by the forces of globalization."

We're not sure, however, that diversity is what motivates the government's interest in international students. Our concern is that there is far too much interest in the revenue potential of these students. The enthusiasm for that international revenue has to be balanced against the reality that international students need and deserve additional support if they're going to receive the quality education that has attracted them to B.C. post-secondary institutions in the first place.

As an instructor who teaches many of these international students, I see firsthand that their needs are far more complex than anyone who is promoting the expansion of international education is prepared to recognize. I see firsthand the result when those needs are not met. Therein lies a significant problem.

If there is an expectation that increased international students could provide a revenue stream to offset the chronic underfunding provided by provincial operating grants, that calculation needs to be examined very carefully because it does not take into account the significant new costs that need to be covered if we're going to meet the needs of international students.

To summarize, the Kwantlen Faculty Association would like to suggest some priorities that need to be strengthened in the 2012 provincial budget. We need to address the affordability challenges that current students face. Simply capping already expensive tuition fees doesn't address the real problem. We could make a meaningful step in the right direction by reviving the student grant program, which would at least allow those with the most significant financial challenges some relief.

We need to see new money provided to post-secondary institutions to ensure that they have the capacity to restore student services that have been scaled back over the last ten years. We need to see an overhaul in the funding relationship between the Industry Training Authority and public post-secondary institutions, which deliver over 90 percent of trades training programs in B.C. That relationship needs to better reflect the true cost of the trades programs that we deliver.

The government needs to look at a new funding formula for post-secondary institutions, a formula that will not only guard against the impact of inflation but also recognize the unique cost pressures that various institutions face in providing access to post-secondary learning in their community.

Thank you, and I will take any questions you might have.

M. Stilwell: Hi, and thanks for coming. I have visited the Kwantlen campuses. I'm interested in the idea and potential of your unique name as a polytechnic university. I'm wondering what your views of that are — the opportunities, the challenges, the current mix of programs. Basically, I'd like to hear if Kwantlen were to meet its potential as being the only polytechnic university in British Columbia, what it would look like in ten years — or not.

J. Murray: That's quite a question. I do have to say that I think the moniker "polytechnic" reflects the fact that Kwantlen, as I said earlier, is the only public post-secondary institution west of Abbotsford. It really shows Kwantlen's roots as a community college to serve the community.

I mentioned the number of programs that we have — everything from adult special education through to ESL through to trades through to university programs. As far as the polytechnic name goes, I think that name reflects right now what we do. As to ten years from now, that is much beyond my own control. I would like to see us continue to serve our communities as best we could in a variety of different programs similar to what we do now. That would be my answer, I think.

[1045]

B. Davis: If I could add to that, I think that the original intent of Kwantlen was to be a polytechnic in some nature back when it was first split off from Douglas. I think that faculty are trying to embrace the polytechnic nature and the program offerings that are within that, and I think that it's a real positive step, given who we have in our backyard, around us. We need to remain to be unique, and we need to have program offerings. However, I would say, though, that given Kwantlen's history with the funding that it has had…. It has been underfunded since its beginning.

In becoming a new university since 2008, and the polytechnic nature in particular, there are some real challenges because the program nature usually associated with polytechnics are such that they're more capital-intensive and require some attention to that.

D. Donaldson (Deputy Chair): Thanks for the presentation. Some very thought-provoking comments around the international students and the introduction of that.

What you alluded to, being perhaps an avenue to generate revenue to address deficits and funding formulas, those kinds of things…. One would hope that that research had been done by the provincial government before the program was announced. Have you seen any documentation, research that was done to address the topic that you brought up? And would you be able to comment on the scope of what kind of research would need to be done in order to quantify that?

J. Murray: I have not seen, personally, any research. Kwantlen, as I mentioned, has had international students
[ Page 1538 ]
for a number of years. The type of research that I think would need to be done would involve not just looking at the overall dollars that are coming into the system through international students but also the costs that are involved in serving those students, all the way from fixed costs such as classrooms and that sort of thing to the extra help that the students need.

Many of the students come from cultures that can be quite different from what we experience here. They have acculturation issues. They need a special type of personal counselling, a special type of academic counselling. These are all issues that I think are just not researched. The cost of those is not researched. I can give you an example, if you like, to help you understand what I mean.

As I mentioned in my presentation, I've taught a great number of international students over the years I've been an instructor, both at Kwantlen and elsewhere. About two years ago, as a result of a program review, Kwantlen changed the way that it served international students. Previously, they would register through the international education department, and they were helped through their registration process. Because of the change suggested by the program review, that ended, and international students did not have that service anymore.

As a result, many of the students that I teach, especially in the ESL program, had such difficulty in accessing computers and understanding what was going on that they disappeared from our system. I've heard that they disappeared entirely. International students tend to vote with their dollars. If things are not easy for them to do or if they don't get the reception that they feel they deserve because of the dollars that they spend, they go elsewhere.

R. Howard (Chair): Thank you, gentlemen. We've run quite over your time, and I've got still a list. We'll have to catch up to you outside of this forum. MLAs Thornthwaite, Ralston and Elmore will catch up to you at some point. We appreciate you taking the time.

Now, committee, we're going to jump forward to Dr. Mychael Gleeson.

M. Gleeson: Hi, Bruce.

B. Ralston: Hi, how are you?

M. Gleeson: I'm fine, thank you.

B. Ralston: I'm looking forward to your presentation.

[1050]

M. Gleeson: You owe me $5.50 for parking.

R. Howard (Chair): Welcome, Doctor. As you probably know, you've got 15 minutes. At about the ten-minute mark I'll give you a heads-up, and you can stop for questions or you can keep going — your choice.

M. Gleeson: I'm Dr. Mychael Gleeson. I represent Mychael Co., which is kind of a joke. We are a legal aid company. I do now almost solely legal aid and have recently found that my files are clogged with incredible stories of seniors.

Now, the difference between my seniors and the seniors that you guys will all be in 25 years is the fact that my people are diminished capacity, some of them absolutely away with the fairies. Two of them are what my father used to call the ball-cap tinfoil-lining crowd, and that means that they're truly loony. My theory is that does not mean they have less of a right to competent, loving and caring help than the richest people, the smartest people, the cutest people, the youngest people.

I looked at five of my case files, and we'll see how far I get. And yes, I have the express permission of each and every one of these people to discuss this.

A little fellow came to me about, I guess, 20 years ago. He told me that his lawyer was in hospital dying and his lawyer was the fabulous Ernie Topham of New Westminster. So I went down to see Ernie, and he said: "You need to take care of this file for me, because these are just absolutely lovely people." So I said: "Okay. How much trouble can these guys be?" Little did I know.

The story of this guy — and we'll call him Bob — was that Bob was reaching 60, and he needed a birth certificate to get early CPP. Well, we decided that we wouldn't be able to get a birth certificate easily for him as the layers of the onion unravelled. What we found out was that Bob, who has turned 65 just a few days ago, was actually the child of his sister.

Now, it's interesting, because this was during the Second World War. Coming from a very, very staunch Dutch Catholic home, the two eldest daughters went into a convent to be members of the Dutch Roman Catholic faith. The convent or nunnery was invaded by, we think, German troops — no one has fingerprints — and the two daughters were violated. One became pregnant with a child.

She went to the priest, and she said: "I don't know what to do. I'm carrying a child. I'm actually the wife of either God or Jesus. I'm not sure." And she said: "I need counsel." And he said: "You will have the child. You will ask your parents if they will take the child."

This beautiful infant was born — because I've seen pictures of him when he was little. She gave this child to her parents. They raised him as their own. There were absolutely no legal papers involved and no birth certificate. So he gets to the age of 60 and thinks: "Okay, early CPP. I've worked really hard all my life. I'll do early CPP. Mychael makes me pay into CPP. I'll take early CPP."

We can't get him a birth certificate. It took us five years to get him a birth certificate. I asked three of my lawyer friends who drive BMWs as opposed to us who
[ Page 1539 ]
drive Subarus — 1984 Subarus — what it would have cost. They said between $8,500 and $25,000 to do what it took us. Granted, we're incompetent doctors as opposed to bright lawyers.

It took us five years to get Bob's birth certificate because we had to get one created. We had to find people in the village who remembered the invasion, who remembered the nunnery, which has since been burned down, and who remembered the So-and-so family with a tiny baby when they were 60. But they said they'd been on vacation, so everybody believed that in those days.

[1055]

So what do you do if you're my buddy Bob and you need legal help, and there is no legal aid? Your OAP would have been on the line. His CPP was on the line. The whole thing. You ask: "Well, how did he get to Canada?" He got to Canada via immigration. Immigration accepted his certificate of baptism. Although we started there, they just had the month and the year, because no one was quite sure when Bob was born. That's Bob.

My next file on my desk, we'll call her Joanne. Joanne is 94, an unmarried lady and someone not to be messed with. She doesn't like my humour, and she doesn't like the way I dress, and she tells me that every time she comes in for an appointment. When I suggest that there are other people that she could attend, she says: "They all cost more than you cost."

She comes in for her appointment, and she has a stack of paper. She's looking a little sheepish, which is really new, and I said to her: "What's the problem?" She said: "I took my taxes to the Seniors Bureau." I go: "Fine."

She said: "They put my guaranteed income supplement amount on the alimony line, and I've got this letter from Revenue Canada." Well, the letter is a computer printout, but she thinks it's a personal letter and that they're going to come to get her any day. They want five years of her tax records; her divorce document — the divorce decree; the schedule of alimony paid to her; the death certificate of her husband, if he's actually passed away; and/or remarriage documentation. She goes: "I never married. I barely dated."

I give it to my computer freak, who gives it back to me, saying, "I don't even know where to start," and we start this process. The first letter is to Revenue Canada, saying: "Look. Please understand that we do the community volunteer income tax program, and we are all, basically, electronically and mathematically disabled persons. We're not crooks; we're idiots. So when we make mistakes, we're not trying to con you. We're just stupid."

They immediately assign us a counsellor from the fairness committee, who sends me this huge document, as if I don't have anything else to do, to try to fix this lady's documents.

Short story: we refiled and explained that there'd never been a marriage. Solved, but the problem is: had she gone to any lawyer, had she requested legal aid, had she not had us…. And the only reason we have her is because my computer freak — not getting enough money, because I'm cheap — also has a carpet cleaning business, so he cleans her carpets. So when she had problems years ago, she arrived with us. But had she not had anywhere to go — and she doesn't, because there isn't any legal aid, which is my point — (a) she wouldn't be filing her taxes, because she's frightened; and (b) she wouldn't have her guaranteed income supplement. I don't think they can stop her OAP, but they can stop her CPP.

I'm thinking: there's something really wrong here. These are our elders. These are seniors. These are special people who have spent all their lives building the university that I went to — and I'm thankful for that, hourly — but there's no mechanism. I have threatened to retire in November when I turn 60, and they have threatened to move into my carport. Unfortunately, I can just see Bob with his easy chair and his television, and Joanne knitting, and my computer freak saying: "There's no place to park. There's no place to park."

Have I run out of my ten minutes?

R. Howard (Chair): You're just there.

M. Gleeson: Okay. Are there any questions? This is the plight of legal aid.

M. Stilwell: I'm probably not first in line….

R. Howard (Chair): That's okay, you are.

M. Stilwell: Who pays you currently? Is this a volunteer service, or….? How do you get funding to do what you do?

M. Gleeson: We have absolutely no funding, not a drop. My income tax last year was 16 grand. I'm a triple PhD, and I made 16 grand — okay? That is my lawyer's coffee budget.

[1100]

I also tap him up for money frequently, so I guess he is my funding agency.

Bruce, I guess you know the gentleman that I'm talking about in terms of my lawyer.

B. Ralston: I think I've forgotten. Maybe you can remind me.

M. Gleeson: I will. Don't hit him up for money. I'm already doing that. Ever since he got call display, he's a lot less easy to get hold of.

So there is absolutely no funding. What we do is, because it's really important not to embarrass our seniors, we tell them that there is a $5 file charge. That goes in coffee and cookies. But the whole thing is we say to them, you know…. "Yes," I said to Joanne, "I will absolutely take
[ Page 1540 ]
care of your tax problem. I have no idea how long it will take, but there is a $5 file charge." She goes into her wallet, and there it goes, and we now have a legal binding contract, and she leaves feeling okay because she has that right. And then I phone up my lawyer and say: "I'm going to need some money here."

My whole theory is that with shrinking systems, we're going to have more. The plight of the truly loony is magnificent. I had a guy come into my office. He had a very nasty letter from Revenue Canada. He was also a guy who was 60, and I've taken care of him for probably 20 years. He was in the May Day parade in New Westminster riding a bicycle with a lady's floral sunbonnet, a beard, a long grey ponytail, short pants and one of the crazy bikes from Cap's. So I got an extra copy of the front page of the Record, because that's where the photograph appeared, and sent it to Revenue Canada. I said: "Are you really going to prosecute this guy? Because I'm going to really embarrass you if you do."

His crime was that he had written in on his Revenue Canada form — and remember he is certifiably nuts; the guy's a certified paranoid schizophrenic — that he was a space cadet as occupation, because currently his psychiatrist, who thinks that modern jargon will be easier for paranoid schizophrenics to deal with, says: "You don't have to worry about your life. We can control you with medication. You're basically a space cadet." So my guy gets his form. It says occupation — space cadet.

Revenue Canada did not enjoy the same sense of humour as my guy's — I'm calling him Tommy — new psychiatrist. I wanted to actually hook up Revenue Canada with psychiatric services, but there's no mechanism to do that.

D. Donaldson (Deputy Chair): Thanks again this year for your presentation. Hi. No mechanism.

We've heard from other people who've worked in the legal aid system about the efficient work that they do, that you are doing, as well, that helps not only people but the system. What would you have as a recommendation around the legal aid system then?

M. Gleeson: If we were to roll the clocks back — and I'm not asking for a huge amount — and to roll the coffers back to 1997. We had a system in place in those days that worked, and primarily in terms of mental health. If you had an individual who had an active psychiatric diagnosis on record, was cared for by a team, you could then represent that person, either at a mental patient's review or any kind of scrape. In the 1980s everybody filed in and was heard by Lorne Clare. It just got to the point where I would walk into the room and his eyes would roll.

We will never get back to that era, because the pace is so great. But if we were to roll back the coffers to 1997-98 when the budget was alive…. In those days if your child was in jeopardy of being snatched by social services, if your child had been touched, abused, assaulted or disrespected — I'm not quite sure; I think the new word for that is "bullied"— you could get assistance.

[1105]

Those systems gave us workable parameters. If you were a senior and you required support, you could go to any lawyer, the lawyer would get in touch with legal aid, and legal aid would say, "Okay," to some $550-an-hour lawyer, "You're going to get 88 bucks an hour and $250 for expert reports." They would go: "Okay, that's my one hour per week of pro bono work, and I'm happy with that." If we rolled it that far back, we could take care of my people.

I've talked this morning about seniors. I've talked to you before about kids in jeopardy, about the mentally disabled, about the handicapped. We have a plethora of problems out there, and people have nowhere to go. More and more, the people who are dealing with this — the David Goodwins, the Thomas Hardings, the Bob Shantzs — are going to retire.

David is younger than I am. Thomas is younger than I am. Bob is older than I am. But when these people are gone, my patients are going to be screwed. There's going to be no place to go. There's going to be no safe haven. It's just not fair.

R. Howard (Chair): Thank you, Doctor. Now we've run you out of time. You brought forward a serious subject but with some levity.

M. Gleeson: Thank you for taking me early.

R. Howard (Chair): Now, committee members, we're still sort of jumping around on the list. We're waiting for the next group, but we do have a gentleman in the audience who would like to present to us — Mr. Steve Wood.

Steve, you've been patient. I know that you know you've got 15 minutes. At about ten I'll give you a heads-up.

S. Wood: Great, thanks. I appreciate you squeezing me in.

I moved to Surrey in the summer of 2000 — 10177 Mary Drive. I guess I should say I've had the privilege of serving as a city councillor previously, in my own home of Campbell River, from '93 to '99. So I can appreciate, maybe in a smaller sense, budget challenges and deliberations.

Having said that, a couple of comments. I was at a sports meeting in Surrey recently, and they gave a brief overview of the provincial gaming revenues. I'm not sure of the number. I think it was $2.4 billion — $2.1, $2.3, $2.4. I understand that $700 million went back to the government in surplus, $400 million to hospitals, $100 million to schools, and a few other numbers, leaving $950 million only for sports and/or youth organizations.
[ Page 1541 ]

I'm not sure of the original intent for provincial gaming revenues, but I want to leave you with a question on that. What was the original intent? I guess I would ask, having been an advocate for young people in sports and providing healthy alternatives to the challenging world that young people face…. Given that I don't know the answer of what the original intent of that money was, I would just ask your consideration in looking at those numbers and certainly prioritizing and revisiting the challenge that young people face, and funding for those good programs out there, sports organizations.

You mentioned earlier the provincial Auditor General. I've been doing my homework, attending city council meetings, and it was a concern in a meeting last month. I quizzed the earlier speaker, the Canadian tax federation, and he advised that the Premier had made an announcement that the provincial government was going to fund that.

I don't know if that's accurate or not, but having had the chance to spend an hour with the top administrative person at city hall…. Anyways, it was a good learning experience. I see heads nodding, so if the province is funding that, that's good news. I think it would be a bit unfair. In my hour at city hall with that person, I came away feeling good that she was very fiscally prudent, similar to my home community of Campbell River. We're lucky if you live in a community that has some surplus funds because, as we know, not all communities are so fortunate.

[1110]

Surrey schools. You probably are aware that we have more than 7,000 students getting their education in 290 portable trailers. I have and continue to speak with students and parents, and they find that completely unacceptable and very difficult to learn in. I further understand — and I'll stand corrected if I'm wrong with the numbers — that in the last six years our community has only been able to receive funding for one elementary school. My children were fortunate enough to get their education at Prince Charles Elementary School — not portables — and similarly L.A. Matheson — not portables.

In the bigger picture, it's very difficult. The message I hear is it's very difficult to get an education in a portable trailer doubling for a school. It's not acceptable. We're the fastest-growing community in the province. Frankly, we deserve our fair share, and we haven't got it. So I would ask for your serious consideration. We need those funds, and we need them a.s.a.p.

An issue that's happening this week is the Missing Women Inquiry. It goes hand in hand with the comment on page 3 of your handout — revisiting funding for legal aid and advocacy groups and restoring previous provincial funding cuts. I personally find it appalling that the province is not providing legal funding for the families who have been devastated with those horrific crimes and tragedies.

I would ask that you give consideration to immediately expediting that decision and restore and put in place the funding — 14-plus lawyers provided for the province and for the RCMP and no funding for those families to participate in that inquiry. I don't mean it disrespectfully, my comment, but I find it absolutely shameful that it's not being provided. So I'd ask, if it's possible, to immediately revisit that.

Similarly, the previous speaker…. I think I've said this, but I'm going to say it again. Legal aid and advocacy groups. We know that since 2001 the funding for…. Those great and desperately needed organizations have had the crap kicked out of them. Again, I find it unacceptable. I'm being as polite as I can. Please don't take my comments personally. They're the backbone of the community when families are in desperate need.

I take a bit of a breath, because I've personally felt the challenges when looking for advocacy groups in dealing with different health situations, and there's a shortfall out there. That's about all I can say of that, because it's a little bit too difficult to speak to that issue.

When I go to the inside page — "What programs and spending are your priorities?" — I step back for a minute. We were all appalled by the riots in Vancouver during the Stanley Cup, but I was a bit concerned when I see in the media Premier Clark, I think, really playing on the challenges we all felt when we witnessed those riots and, if I could use the word, "appeasing" the public or playing on their heartstrings. I'm a bit concerned. Politicians are dedicated, hard-working. I prefaced that with my own experience. But I think we need to allow the judges to do their jobs and not interfere with them.

[1115]

That goes hand in hand with allocating the funding required, which leads me to page 3: "What programs and spending are your priorities?" I look down at lines 3 and 4. We've "recently committed to maintaining dedicated policing to combat gang violence and to hire additional sheriffs and judges in the justice system." Great. Excellent. Young people, we know…. We've seen all too recently and very recently the challenges with gang and similar-related violence.

But I'm a bit concerned when I read the next sentence that says: "But we'll also need to revisit our public sector negotiation mandate in 2012 as we consider the deficit gap and government's responsibility…." I sure as heck hope that it's not going to be on the backs of our dedicated public sector workers that determines whether or not we get those additional needed judges. Certainly, we're not going to be stripping the wages of our dedicated workforce to…. Well, I hope I'm reading that wrong. But I think my point is made.

I know that I don't have the magic answer for where cuts will be, but I'm certainly going to give it some consideration and do my best to get my suggestions in by the 14th.
[ Page 1542 ]

R. Howard (Chair): Good, Steve. You're at 11 minutes. Just so you know.

S. Wood: Great. Well, I do appreciate this opportunity. I thank you for your hard work. Thank you for bringing it to north Surrey — your hearings. We've got some good, dedicated, hard-working MLAs and MPs throughout our community, particularly in the north end. There are also some serious socioeconomic challenges in the north end, so hopefully in the future we can have our good MLAs, MPs…. I'm not suggesting that's not working now, but there's room for improvement in dealing with those issues.

R. Howard (Chair): Thanks, Steve. We have a question.

J. Thornthwaite: Thank you very much for your presentation. You covered a lot of information in a very short amount of time. That's good.

Did you get a chance to give your submission on community gaming grants to Skip Triplett?

S. Wood: No, I didn't, actually. As I said, I was attending a monthly sports meeting last month, and they had sent representatives to the provincial gaming…. If anyone has the answer to that question of what the original intent was….

You know, as a fellow who…. Sports is near and dear to my heart as in providing healthy activities for young people, and when I saw the total of the $950 million designated to youth and/or sports groups, it was a little bit of a disappointment. Something jumps out in my memory. That was one of the priorities originally for gaming revenues, but I'll stand corrected. But if anyone knows the answer to that….

J. Thornthwaite: There are quite a bit of funds that do go to sports groups, youth and disabilities. I know that just personally, in my own riding.

The reason I asked you the question was because Skip Triplett is actually reviewing the whole system, and as long as your groups did get an opportunity to present, your views will be presented.

S. Wood: Great.

D. Hayer: Steve, thank you for your presentation. I know it sort of put you on the spot — for having done this.

My question is: are you going to provide us some input, that sort of thing, maybe on how we can generate some new revenues or maybe how we can transfer some money to balance the budget, at the same time providing some more funding to the program you are suggesting that we should be increasing?

S. Wood: I'm going to do my best to look at that and get a submission in. It's my intent to do it. Frankly, I'm busy, as we speak. That's not an excuse. I've been doing my homework, attending municipal meetings, and have the wholehearted desire to return to the political arena. So that's keeping me busy. That's why I'm here today, to do my homework on behalf of the people in our community accordingly. But I appreciate your comment, and I will do my best to get some suggestions in that regard in.

D. Hayer: Thank you for taking your time to come today.

R. Howard (Chair): Thank you, Steve. We appreciate you stepping forward this morning.

S. Wood: Thanks. Keep up the good work.

R. Howard (Chair): You bet.

Next up we have the Fraser Valley Real Estate Board and the British Columbia Real Estate Association. I believe we have Jorda Maisey, Robert Laing and Cameron Muir.

Welcome. As you've probably heard, you've got 15 minutes. At about ten I'll give you a heads-up, if I can. You can take some questions or push straight through. Your choice.

[1120]

J. Maisey: Thanks very much, Mr. Chairman and distinguished members of this committee, for the opportunity for us to present and speak to you this morning. We thank you for your time and commitment to this consultation.

My name is Jorda Maisey. I am a director of the Fraser Valley Real Estate Board and realtor from Langley. I represent nearly 3,000 realtors throughout the Fraser Valley. With me this morning is our representative from BCREA, Mr. Robert Laing, to my right, and Chief Executive Officer Cameron Muir to my left. BCREA represents 11 member real estate boards, including the Fraser Valley, and nearly 19,000 realtors throughout B.C.

We'd like to start by thanking you for this announcement and the improvements in our quality of life for British Columbians. We are pleased when government decisions support growth that encourages economic vitality, provides housing opportunities and builds better communities with good schools and safe neighbourhoods.

In particular, we applaud you for supporting the Port Mann bridge, Highway 1 improvements, the Surrey out-patient facility and Surrey Memorial Hospital ER and critical care tower construction projects. We also appreciate the investments in the many local projects which support people at risk of homelessness.
[ Page 1543 ]

This year the Fraser Valley Real Estate Board is asking you to take attention on two main issues: addressing the public health and safety concerns in drug operations and improving housing affordability. I will be talking to you about drug operations, and then Mr. Robert Laing will present BCREA's recommendations on housing affordability, which are supported by our real estate board.

Fraser Valley realtors welcome the government's commitment to putting citizens at the forefront of its web services and posting more documents on line, such as those available through a freedom-of-information request. We were also encouraged when we heard, in the recent throne speech, that you're planning to amend the privacy legislation. We agree that making more information available will help people make more informed decisions, especially when it comes to choosing property.

Currently property buyers and renters and the realtors who represent them have no consistent way of learning whether a building has been identified as being used in drug production and, if it was, whether it had been remediated to a standard that is safe for its occupancy. As realtors we strive to find the best properties for our clients, whether they choose to buy, rent or lease. Therefore, we research as much as we can to enable members of the public to make informed decisions about those properties.

We also have a duty to check all facts pertaining to a property. Unfortunately, getting access to data on former grow ops and drug labs from municipalities has been very challenging. That's because each community has a different method of tracking this information.

Many of you wonder if the RCMP's latest move to post the locations of dismantled drug operations on a website helps. The RCMP list does provide help — as the addresses where the RCMP have dismantled the drug operations since October 2010. We know what was confiscated, right down to the number of plants. We've encouraged our members to check this list as one of their regular resources of information.

However, we know that this list is not complete. It does not show drug operations that were identified by municipalities, and it only goes back a short period of time. Therefore, we have asked our members to continue to go to their local governments to look for more details on the properties.

Some municipalities carry information on tax certificates; some put notices on title; some don't track the information at all; some keep the information forever; and some only track the information for a limited period of time. I hope you're getting the picture. There is no consistency in the way information on former drug operations is recorded in B.C.

When we came up with a proposal with the city of Surrey that all of our seven local governments could potentially adopt to streamline this process, they were all concerned about privacy legislation. Therefore, we are calling on the provincial government to provide leadership to all B.C. municipalities on the disclosure of information on identified drug operations, using existing provincial legislation in the interest of public safety.

[1125]

When we were exploring the reporting issue with stakeholders, we also discovered another related but equally important issue: the remediation of these properties. There is no provincial standard when it comes to remediating former drug operations. We'd like to see the provincial government offer B.C. municipalities guidance on the remediation and reporting of drug operations, and we have enclosed a report on a remediation process developed by the Alberta Real Estate Association to help you out.

The process that our area has proposed to the Alberta government would require an environmental consultant or industrial hygienist to be involved in the remediation of drug operations from discovery to final inspection. We feel that if all municipalities used this process, former drug operations would be much safer for their future use.

At this time I'd like to ask Robert Laing from BCREA to talk to you about how to make B.C. a better place to buy real estate.

R. Laing: Good morning. BCREA has two major issues that they wanted to address today. One is the transition from the HST to the PST, and the other is something of an old standby — the property transfer tax.

In the first case, BCREA is urging the provincial government to move as quickly as possible to establish transition rules that are clear and transparent and, if at all possible, to shorten the time for the transition period.

The real estate market is entering a great deal of flux due to the uncertainty created by the switch back from the HST system. A great example of that is that developers really rely upon presales in terms of developing their properties. There are no presales going on right now because people are thinking they will wait for 18 months and that then they'll probably save 7 percent on the purchase of their new properties. The developers won't move forward because the banks won't finance unless there's a presale history in place.

Basically, the brand-new condo market…. While there may be presales in place that occurred prior to the HST implementation, since the people voted to remove the HST, there have not been any new developments in terms of new condominiums. That's our first piece.

Our second piece — we really think this is a great opportunity to revisit the property transfer tax. As I'm sure you're aware, but in case you're not, the property transfer tax works like this. A rate of 1 percent is charged on the first $200,000 of the fair market value of a home, and then a rate of 2 percent applies to the remaining value. The structure of the property transfer tax hasn't
[ Page 1544 ]
changed since it was introduced in 1987, but obviously, the housing market has. For example, in 1987 the average home price was around $102,000. In 2010 it was over $505,000.

The B.C. Real Estate Association and its member boards are in good company in asking for changes to the property transfer tax. Changes, even elimination, have been called on by the B.C. Liberal Party; the Urban Development Institute, Pacific Region; Canadian Home Builders Association of B.C.; B.C. Chamber of Commerce; and the Vancouver Board of Trade.

Our recommendation today is that the 1 percent threshold be increased from $200,000 to $525,000. We believe this would be a good start in restoring fairness for homebuyers, who have paid increasing amounts of property transfer tax since the late 1980s. If the 1 percent threshold had been increased to $525,000 in 2010, more than 70 percent of B.C. homebuyers would have paid less tax.

There would be a financial impact on the government, although we believe it's relatively minor. In 2010 revenue would have decreased by $158 million, less than 1 percent of the taxation revenue. On the other hand, we believe that by increasing the threshold, you will increase the number of people buying properties and that in that way, the gap for the $158 million would quickly decrease, which would also be helped by the ongoing increase in property values.

[1130]

To ensure fairness going forward, we also recommend that the 1 percent property transfer tax threshold be indexed using Statistics Canada's new housing price index, with adjustments made annually. The threshold isn't indexed now, so it remains the same. However, home prices increase over time — historically in the Lower Mainland, dramatically. This means B.C. homebuyers pay an increasingly unfair amount of property transfer tax per transaction every year. Indexing will ensure the tax has the same impact on current and future homebuyers.

I think, with that, we'll take any questions. Just to clarify, Cameron Muir is BCREA's chief economist and can also answer any questions on the market as it stands today.

R. Howard (Chair): Excellent. Thank you. We have a number of questions.

D. Hayer: Thank you very much for the presentation. I have been hearing quite a few times…. I was on the committee for almost six years. There was a property transfer tax. I'm glad you're still keeping it up. I say you should keep it up until you get it.

My question is on the real estate market. How do you see the market right now in residential and commercial? Is the market also being affected — and not just from the HST issue — because of what's happening in Europe or what's happening in the United States recently? Because I was talking to some realtors, I wanted to find out what your opinions are. As experts, where do you think we are going by this?

Then also, HST and the pricing under — I think it was — 525. There was almost a net zero effect on it. Is the market under 525 also affected with the decision on HST or not?

R. Laing: Cameron, why don't I let you start off.

C. Muir: Sure. I think the answer is yes. When we look at the global economic marketplace as well as equity markets and financial markets, for that matter, in Europe, they do have an impact here locally. We're a small, open trading economy and rely a great deal on trade.

Our largest trading partner — of course, the United States — is still mired in economic malaise, and recent events certainly are going to extenuate those less-than-perfect circumstances and, as a result, are going to impact our economy here in Canada. In British Columbia economic growth is going to be slower today going forward than we expected at the beginning of this year.

In terms of the overall market — the consumer demand side — we're likely going to see home sales stagnate probably below the ten-year average for quite some time. We're likely to see home prices remain quite flat with some downward pressure and some oversupply of markets in the province. That could be further exacerbated by, of course, any further kind of turmoil or — I don't want to say crisis — erosion of consumer confidence.

Other things we're battling in terms of the overall marketplace and demand are the demographics as well. We're seeing that the aging boomers, of course, now are nearing their retirement years. They're in a period now of, rather than purchasing — whether it be retail sales or housing, for that matter — belt-tightening and saving for retirement. So that's going to be a longer-term impact as well.

Your question on the 525 threshold on the HST. In terms of the economic impact, you know, not much at all. Unfortunately, the perception with consumers in the marketplace, despite a great deal of effort of education around the HST and how the impacts are, particularly below that 525 threshold, it's still having an impact. Other markets…. Well, in Vancouver, of course, higher-priced homes, especially new homes, are necessitating quite a large chunk of HST to be paid.

In addition to that, I think, more importantly, in terms of a decimated real estate market in the province, is the recreation market and that the combination of relative bargains in the United States and the HST has really pulled the rug out of the recreation market in British Columbia. It's going to be a number of years even after the HST is overturned or is put back to the PST that
[ Page 1545 ]
we're going to see some languishing or lingering effects of that to come.

B. Ralston: My question is about the transition from HST back to PST. The Leader of the Opposition and I both raised this in question period last week with the Premier, and beyond saying it's being done as fast as it can be done, she provided no further details. So I'm wondering if you and any of your lobbying efforts have got a more precise fix on what efforts are being made to accelerate the process.

R. Laing: The day the election results were returned we sent a letter to Minister Falcon saying that we would really like to see very clear transition rules immediately, and we were a little concerned at the 18-month period that was quoted. We have received a response right away from the minister.

[1135]

It was more or less the standard letter coming back, saying they're looking at all of these things. What concerns a lot of people in the real estate industry is that the possibility that the HST would be rescinded was a very real possibility. We were somewhat surprised that we could not have a response — sort of a plan B ready to go. But at that point, that's about all we received.

The realtors in the province are very concerned about the fragility of the real estate market. The last statistic that I looked at: of our 18,700 members, last year 50 percent had four house sales or less. That translates into a very low income for a job that requires a lot of hours and dedication. When they're not making a very good wage and not seeing any future, there's a lot of despair out there.

R. Howard (Chair): Well, I'm sorry, but we've run you out of time. We have a long list wanting to talk to you. MLAs Thornthwaite, Donaldson, Elmore and Stilwell will all have to catch up with you outside of this.

R. Laing: Happy to take any questions at any time.

R. Howard (Chair): Thank you for coming forward.

We're just going to take a two-minute recess, I guess, while the Food Processors Association gets their stuff together.

The committee recessed from 11:37 a.m. to 11:39 a.m.

[R. Howard in the chair.]

R. Howard (Chair): We now have the B.C. Food Processors Association — Nico Human and Dave Eto.

Welcome. As you probably know, you've got 15 minutes. At about the ten-minute mark, if I can, I'll give you a heads-up. You can either stop and take questions or go straight through — your choice.

D. Eto: Thank you very much and good morning, committee. My name is Dave Eto, the president and chair of the B.C. Food Processors. Good morning, Dr. Stilwell.

[1140]

We're very pleased to be here on behalf of the B.C. Food Processors Association. In front of you, you have a little package that we'll very quickly go through to help you understand what we do and how we try and represent industry in British Columbia.

The B.C. Food Processors is a not-for-profit organization created back in 2004. We currently have 161 processor and associate members, and we are continuing to grow. We represent all segments of the food, beverage, nutraceutical, health and natural products in processing. We're trying to coordinate common activities within the industry and put all of these activities under one umbrella.

Our association represents micro, small, medium and large industries. Our smallest member, actually, is one person. Our largest is over a thousand. We have many members that are well within the hundreds of employees base.

As you well know, the B.C. agrifood industry is a $22 billion system that employs 280,000 people across the province. We account for one of every seven jobs here in British Columbia, of which we are very proud. Fish, dairy, poultry, meat and beverages are the major sectors of our industry and of the members that currently are part of B.C. Food Processors.

The core value of B.C. Food Processors is all about inclusivity. We believe that you have to have a collaborative approach to food processors within British Columbia and within the whole food chain and that we try to engage in positive dialogue with government.

We appreciate the opportunity to be here to help share with you some of our stories and to take you through our program. Now I'd like to introduce to you Nico Human, who is our current executive director.

N. Human: Good morning, everybody. Nice to see you again. I've seen several faces every year. It's like a yearly date we have. Nice to be here. This year I've tried to make it a little simpler, and I've taken sort of a Coles Notes version with pictures and appendices at the back — trying to make it easier.

Some of the highlights. There are tons of highlights, but I think I've tried to find what is relevant for this particular activity. The first one is our committees. Our committee structure is really growing, and it's something that the association and the industry are really finding value with. I'm showing you a picture on the top of the second page of one of these committees at work. Government regularly uses these committees also as a sounding board. We offer it to ministers, ADMs, etc., to send us if there's something that they want tested in the industry. They may take it to the committees, and ex officios work on there as well.
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Some of the projects that are very relevant at this stage. The first one is the Food Innovation Centre of B.C. I've been reporting on the technology centre, as we called it before, every year and how it's progressing and progressing. It's now an entity on its own. It's got its board of directors. Dave is actually on the board representing the association. And it's got its own logo. You see the Food Innovation Centre of B.C. there, with a plate that's also an idea bubble. It's all about developing the industry and coming up with new, innovative ideas to grow the industry.

They have found their first offices in Chilliwack at one of our members, and they are up and running. We're very happy to say it's up and running. We appreciate the support we've received from government up until now, and we would appreciate for that to continue until this is fully functional.

Another project that we are really enjoying at this stage and we're making great inroads in is the food preservation project. This came about as part of the projects availability initiative of the Ministries of Health and of Agriculture. It's within the Heart and Stroke Foundation. On our first round we established gardens back in the very remote communities across British Columbia. These are communities where you have to go in by floatplane, or it takes a day and a half on a sunny day to get there with a truck. In winter they're totally cut off. We found that in those communities the indigenous knowledge has disappeared over the last ten, 15 or 20 years, and we're putting that back in.

You see a group that we've trained at the bottom here, in a pilot project. They've got their gardens established now. Now they need to get the skills back so that they can start processing them again, canning and those types of things — teaching them that. We've put all the resources together. I have a sterling team of ladies working with me, who are training them, and you see one of the groups that have been trained.

We've now got a system where we train the trainers, and then they go back into the communities. That's turning out to be very successful. We've done that, and we also have opened the door and developed an initiative where, if there's someone in that community who shows entrepreneurship qualities, they can actually be supported to start a business in the community. That's our next step.

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The project is showing great potential to bring back essential skills in the communities not only to the remote communities but across British Columbia to create jobs and stimulate the creation of small businesses. So basically with that one….

As far as the next one, on page 3, the meat industry support keeps evolving. We call it the meat file in the association. It's got different components. The first one is MTAP — the meat transition assistance program. That is in the process of winding down. It is closed for applications, and we are in the process of now allowing the last applications to be processed and to receive their funding assistance to take them to licensing.

Also, the meat industry enhancement strategy has completed its work, actually at the end of last month, and a new program, the sustainable food safety program, has been launched. This has the following key elements. First of all, industry support. That's to complete the A and B licences and the transition for the remaining proponents and development of web-based information resources for the future.

There's a ton of training programs, especially in slaughter techniques and best practices. There are lots of regional approaches, identification of optimal approaches for regional local governments to support the livestock and the meat industry, the development and piloting and template operational and policy solutions and also industry development.

What we want to do is bring all the industry role players closer together and make sure that the resources are used optimally, but then also food safety strategies to support development of an inspection service for British Columbia, a B.C. approach to HACCP and promotion of B.C.'s licensing system.

That's the highlights of the meat industry support. I have attached the appendix at the back if you want all the details of the dates and when programs are closing. It's all in the appendix. But I thought for this Coles Notes version I'd just give you the highlights.

Something that I haven't included before but I think is something that we found valuable when visiting with ministers is to give you an idea of some current and emerging issues in the industry as we see them. The first one that we are working on right now is to bring the natural health product industry into the BCFPA fold. Some of you might know that the WCFN — Western Canadian Functional Food Network — unfortunately couldn't survive in the last year or so, and so they've lost their membership.

Many of their members came over to us, so we are very concerned that that voice — and that's a vital part of the food-processing industry — has got a voice and has got a home. So we're in the process of bringing all those members into the BCFPA fold. We'll give them their own voice for their specific activities as well. That's all the natural health products and the nutraceuticals and those types of products.

Something else that we hear about all the time is the level playing field, things like imports that come across the border and people don't have the same…. We in British Columbia have to be super-clean, super-safe and labelled to death, and then something comes across the border, and it doesn't have the same rules. Then we have to compete with that. That's something that's always on our radar screen — and the enforcement thing. The en-
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forcement thing is a massive thing that our members talk about all the time.

I won't spend much time on it, but the social media thing is massive as well. Some of our members are using it to their own advantage. They're very, very clever. Some of them tweet. They have their Twitter pages, and they tweet every day. They have their followers. They use it instead of market research. If you have 1,500 followers, you can place your product on a grocery shelf and tell your followers: "Please go taste that and tell me what it tastes like." Within a couple of hours, they know if it's too salty or too sweet or whatever. Some people use it to their advantage. But it can also….

R. Howard (Chair): Nico, just so you know — sorry to interrupt — you're at about ten minutes.

N. Human: Okay. I'm nearly done.

Healthy food for healthy living. That's a massive one that we're working on right now, because I think we can make a major contribution to help address the issue.

Leadership, value chains and sustainability. Our request to government is very simple, basically four things. The first one is funding and partnership support for the Food Innovation Centre, for that to continue. Then funding and partnership support for the produce preservation program. On the fourth page, at the top, you'll see there are things…. We want to take this to the whole province, not only the remote communities. We also want to take it to the job creation realm, because there's a lot we can do.

Lastly, for the meat file, support for the livestock waste issue initiative to address outstanding issues in waste management solutions and support for the development and ongoing operation of the inspection service for class A and B licence holder facilities.

Over to Dave.

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D. Eto: Thanks, Nico. As I mentioned before, collaboration and inclusivity are really important now that we've been trying to extend our reach with other associations within British Columbia. So it's not just the WCFN; we're also trying to make contact with the Craft Brewers Association on the Island, with the distillers association, the B.C. Bakers Association. There are a lot of overlaps, and our membership spans bakeries, suppliers to bakeries and financial groups.

It's all about trying to make a stronger base. We don't want to be coming to ministers just with our hands out asking for money all the time. We want to be exchanging conversations and having an opportunity to solve issues that you're faced with but also ones that have direct impact on our members. With that, I'd like to conclude our presentation and thank you very much for your time.

R. Howard (Chair): Excellent. Thank you. We have a number of questions. We'll see if we can get through them.

B. Ralston: I just had a further question about the Food Innovation Centre. That was a recommendation of this committee for a number of years, and it seems to have been followed. Can you explain why it's important and what sort of funding, ongoing, you're looking for, and what you expect would result to the benefit of the industry and to the province from that funding?

D. Eto: In terms of how much funding is required, we have, of course, the $2 million — one per year for the next two years. Our objective is to make it self-sustaining and to be the only self-sustaining innovation centre across Canada. That's our initiative right now. I don't know if you can actually pick a number or if I could pick a number on how much money we would require. What I would like to ask is that there is an open-mindedness to the success we have with engaging industry.

We do have a lot of industry support. There are a lot of current members of the B.C. Food Processors, the small-scale and others within British Columbia, that would like to participate in this area. We've developed an agenda and a curriculum of products and services that we can provide, with the intent of collaborating with current academia, with current programs that are being offered by consultants.

There's not an overlap. What we're filling is a gap. That's really important, but it also takes time to define and establish that these gaps are very beneficial to the industry.

J. Thornthwaite: Thank you for your presentation. I just wanted to ask whether or not you can give us more information now or if it's coming — the proposal that you are preparing on healthy food for healthy living.

N. Human: We're actually in the process of developing the proposal. We haven't got much more. Suffice to say that we're working with the Quebec government, because they're in the process of implementing something. We actually heard about this through the Canadian council for food processors. They were talking about it. Then we thought we should bring it to our province, definitely.

It's apparently a very successful program that was in France, and the Quebec government is now following what France is doing. We're trying to develop our own one. It'll be totally different, because our commodities are different and our products are different. We'll need approximately three months to do something concrete.

J. Thornthwaite: Can I ask a supplement?

R. Howard (Chair): We're out of time.
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N. Human: We'll have to e-mail or something.

R. Howard (Chair): Yeah. Sorry, we are out of time. We have MLAs Thornthwaite, Donaldson, Elmore and Hayer on the speaking list, who'll have to catch up with you after this. I thank you both for making the effort to get out here today.

Committee members, that'll wrap us up. We'll adjourn now and reconvene at 1:05.

The committee recessed from 11:54 a.m. to 1:02 p.m.

[R. Howard in the chair.]

R. Howard (Chair): We have in front of us, from the Vancouver Airport Authority, Tony Gugliotta.

Welcome, Tony. As you probably know, you have 15 minutes. At about the ten-minute mark I'll give you a heads-up, and you can stop for questions, or you can keep going — your choice. Over to you.

T. Gugliotta: Great. Well, thank you very much. I appreciate the opportunity to come and do this presentation to you. I hope all of you have a copy of the slides. I'm just going to walk through the slides, and I'll just inform you as I go through them in terms of which slide I'm on.

Today I'd just like to spend a few minutes to talk about YVR, the airport, our role in terms of the B.C. economy and, hopefully, some actions that the provincial government can take to help us continue to be an economic generator for the province.

If you turn to the next slide, just some statistics in terms of number of passengers in 2010 — 16.8 million. We'll probably be at 17.2 million this year, so some slight growth.

We just completed an economic impact study that indicated there are 23,600 jobs at the airport. Obviously, with those numbers of jobs, you can see what the economic impact is to the province of B.C. When you include indirect and induced economic impact, it amounts to almost 62,000 jobs and $11.7 billion, so pretty significant.

Our goal, which you'll hopefully find an opportunity, is to really make Vancouver the premier gateway in terms of an airport between Asia and the Americas. In order to do this, we really have to focus in on some critical relationships.

The first is we need to be attractive to airlines in terms of being cost-competitive so that they'll choose Vancouver. We need to provide customers with high-quality customer service, particularly for connecting passengers to make sure they can connect through the airport with their bags quickly.

Another critical relationship is the federal government. We really rely on them to provide access through their negotiations as well as making the border function efficiently in terms of border policies.

Obviously, we have a close working relationship with the B.C. government, and the B.C. government has been a strong advocate on behalf of the airport when they're having discussions with the federal government. But there's also a role that the B.C. government can play, and I'll sort of speak to that in two areas today.

Finally, we need to ensure we have community support. I sometimes say the airport would be a perfect economic generator if it wasn't for the noise that the aircraft make. So in order to be sensitive to the community and the impacts we have, that's an area we have to closely manage in terms of ensuring we minimize that impact.

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So why a gateway? I think, just to give you some insight, if we were to just rely on people who are flying back and forth from Vancouver to Asia, the city is large enough to support only so much air service. By having connecting passengers — and those are people who are just connecting through Vancouver — what that does is enable a whole bunch of other services that wouldn't be profitable or wouldn't be in place to actually be in place. It allows Vancouver to be connected to more destinations and services, and that fosters trade and tourism that we wouldn't have if we weren't a gateway airport.

If you turn to the next slide, you can see that in terms of a gateway airport, we do have some competition. Traditionally, it's been the west coast airports, which are San Francisco, Seattle and Los Angeles. But what we're finding now is that the aircraft technology is actually allowing aircraft to fly direct to points inland in terms of North America without the need to stop at a west coast airport.

You can see in the statistics over the last ten years where our traffic to and from Asia has actually gone down, and you can see that for airports such as New York and Toronto, their traffic has increased incredibly as they now see direct service. The airport authority sort of reflected on this, and we thought there was still some significant opportunity in terms of developing a gateway, but we needed to be a little bit more aggressive.

One of the things we did is announce an incentive program where we froze our landing and terminal fees at 2010 rates so any capacity that airlines added for a five-year period would be at no charge. There was an incentive for airlines to add in capacity. In support of this strategy, former Premier Gordon Campbell announced last September at the Routes conference that the province would eliminate the fuel tax on international flights, beginning April 2012.

If you turn to the next slide, here we have a chart that just gives a perspective as to where we fit with respect to international aviation fuel taxes. You can see that our competitors in terms of Washington, California and Alaska do not have a fuel tax on international flights — likewise, the province of Alberta. So it's a competitive issue for us, and when we're out there marketing to
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international carriers, asking them to choose a gateway into North America, the fuel tax is an issue for them.

I'll give you an example. For a fully loaded 747 from Hong Kong to Vancouver, the fuel tax amounts to about $3,300 per flight, which is about a million dollars a year. It may not be that much in terms of their overall operating costs, but it is a significant amount that can sometimes make the difference between a route being profitable or not profitable.

This was a strategy, in terms of eliminating the tax, that was supported by all major airports in B.C. They all wrote letters to the province in support of this strategy. Again, we were happy when the Premier made the announcement, but obviously, there's been a change in political leadership since then, which makes it interesting. And that's why I'm here today — to sort of speak to that change in terms of the fuel tax.

The next slide just gives you an indication that we've been working with the airlines over the past year, saying: "Listen, on the basis of our incentive program and on the basis of the government announcing the elimination of fuel tax, what are you prepared to commit to in writing in terms of capacity that you'll add to Vancouver over the next five years?"

We've had 22 airlines enter into agreements with us, and with those agreements, over the next five years those airlines have committed to a 28 percent increase in passengers and a 32 percent increase in cargo frequencies. So what we've done is taken that passenger increase and translated that into person-years of employment.

There are 2,000 direct person-years of employment associated with that increase, and when you include indirect and induced, there are another 4,800 jobs — so a very positive response from the airlines with respect to this program. Just to let you know, the revenue that the airport authority is forgoing as a result of this increased capacity over the five years amounts to about $149 million.

If you turn to the next page, in addition to the incentive program, we're also investing about $600 million in terms of making it easier for connecting passengers to go from an international flight to a domestic flight, both for passengers as well as their bags. Our goal is to reduce the processing time through the airport and provide an operating environment for airlines that will facilitate the growth of gateway traffic.

Now, the person-years just associated with this capital program are about 1,900 jobs. Our total capital program is about a billion, but about $600 million is directly related to the gateway and our ability to sort of process international connecting passengers.

Now, if you take the revenue that the provincial government will take from the increased services, as well as from the capital, it amounts to about $24 million a year, once the five years are done, on a normalized basis. This will exceed the amount that the international aviation fuel tax takes in currently, which is roughly between $16 million and $18 million a year. So this will be revenue-positive for the provincial government.

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If you go to the next slide, I just wanted to raise one other issue. When we were talking amongst the airports in B.C. and having discussions about trying to incent airlines to choose B.C., the thinking was that if we provided an incentive program and reduced the fuel tax, we needed to sort of ramp up our marketing program.

Right now every airport in B.C. markets independently, but we felt that if we were looking to Asia, there would be more benefit if we did that collectively, sort of as an airport group. First try and get them to look at B.C. Then obviously, once they've made the decision to come to B.C., they could choose which airport they wanted to go to. There were some merits, we thought, in having a collective marketing program focused on passenger and cargo air services.

What we've come up with is a three-year program where the airport authority in Vancouver would contribute a million dollars, the B.C. regional airports collectively would contribute $200,000 per year for that three-year period, and we're asking the provincial government to match by committing a million dollars in each of those three years.

If you go to the next slide, you can see these are the airports that have signed up to this program. So it covers, basically, every major regional airport in B.C.

I think, in closing, that it's a significant opportunity, obviously, for us to develop YVR as a gateway. But as you can see, it is a growing, competitive environment, and I think we need to move quickly if we want to capitalize upon this. I should have mentioned, for example, that the other airports have aspirations to be a gateway. Calgary Airport is actually spending $2 billion. They're building 22 international gates, and their primary focus is on developing Calgary as a gateway into Asia, into North America. What they want to see is people flying, obviously, into Calgary first and then using Calgary as a base to sort of go out throughout North America.

It's a competitive field, and we feel that we need to respond aggressively. We're doing that with the infrastructure. We're doing it with the incentive program. But we also need government help, particularly in policies that could have an impact on our ability to be competitive — both with respect to the fuel tax and, for the federal government, with respect to air policy and border policies.

I went through that very quickly, because I was hoping there might be time for questions. But I also have my speaking notes attached, which basically cover what I've said. If I've gone through something more quickly, then you can always refer to the speaking notes later.

R. Howard (Chair): Thanks, Tony. We do have some questions.
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D. Hayer: Thank you very much, Tony, for your presentation, as you do present every year. My question is about India. I remember when we went there with Premier Campbell, I think around 2007, they were looking at maybe bringing direct flights from India — either Delhi or Mumbai — to Vancouver International Airport.

Also, there was some talk about maybe having from Punjab, Amritsar, to Abbotsford — right? Are there some talks still going on? The economy sort of went down, so everything changed. Are there still some talks to have those direct flights? Also, are you working closely with Abbotsford? Will you come to Abbotsford so we can work out of one hub, rather than at two different hubs? Those two airports are very important for them and for us.

T. Gugliotta: Well, India is important. It's the largest unserved market out of YVR in terms of direct service, and it's a growing market. Over the last ten years, I think, the number of passengers who have flown between India and Vancouver has almost doubled, so there's a huge opportunity there.

The problem with India, of course, is that the distance is very long, so the economics of having a direct service are very difficult and challenging, particularly given the high fuel prices. But we've had discussions with all three of the major Indian carriers, as well as with Air Canada. I think they see it as an opportunity, but probably once the 787 aircraft start arriving. That's, I think, the type of aircraft that would have the ability to make that long flight and do it in a way that's profitable. Right now, I think, in order to serve India you have to connect through another point.

The problem with connecting through another point, of course, is that if you don't have direct service, it's really an impediment to growing both your tourism and trade if people have to connect through to get here. But that's obviously a high priority, and we're working closely with Abbotsford. In fact, this marketing program that I talked to you about would be something where we would work with Abbotsford just to see if we could generate interest in terms of a Lower Mainland service.

D. Donaldson (Deputy Chair): Thanks for the presentation. I understand that the two-cents-a-litre aviation fuel tax is not associated with the carbon tax. But what's the airport authority's position on the carbon tax leading up to 2012, and what initiatives are you putting in place to address carbon emissions?

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T. Gugliotta: Well, I probably can't speak in detail to all the initiatives that the airport has. But we have a number of programs, obviously, that we're looking at to sort of minimize our carbon footprint, our carbon imprint, in terms of the community. I could always get you details of what those programs would be.

In terms of the carbon tax, we have not taken an official position. That's just charged for local domestic flights, which we think is within the purview of the government.

I think we would probably take a position if that was charged for flights outside of B.C., because that would probably have a competitive impact. Again, if we're trying to encourage international carriers for flying into Vancouver, and they have to pay carbon tax on that international footprint, that would put us at a competitive disadvantage, unless all airports instituted that.

I do know that the airline industry is trying to come up with a regime with respect to taking into account their impact on the environment, and I know they're working closely with the IATA nations to come up with a program where the aviation industry would take responsibility for the impact they have on the environment.

R. Howard (Chair): Tony, I just had a question on leakage. I saw with not surprise but some concern that I think there is an airline out of the States…. Is it Allegiant?

T. Gugliotta: Allegiant airline — yes.

R. Howard (Chair): In their recent ad I saw in one of the regional papers — I think it was the Vancouver Sun — they were targeting all the airports all across the 49th parallel. How bad is leakage for you guys?

T. Gugliotta: Well, it's pretty significant. It's probably about two million passengers a year. So when you look at our 16.8 million passengers, there are another two million of those that are Vancouver residents who are driving either to Bellingham or to Seattle. So that's having an impact, because if they were flying out of Vancouver, obviously we'd have a lot more service and destinations to points in the U.S. That would make us more attractive as a gateway.

If you have airline passengers flying in from Asia and you have more services to the U.S., you would be more attractive as a gateway, because you'd have that second leg that you can take. Our U.S. services are compromised as a result of leakage.

B. Ralston: We did hear from Kamloops Airport and also Victoria Airport, and they are targeting direct flights as well. I appreciate this initiative is to develop Asian business. Is there a contradiction among the group in that respect?

T. Gugliotta: No, the marketing program would be to market B.C. worldwide. Obviously, from Vancouver's perspective, we see a focus on Asia. But I think Victoria would probably see an opportunity with respect to Europe, particularly charter services and direct services to other communities in B.C., probably from Europe, if they're looking at the tourism component in terms of ski visits.
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I think the objective of the marketing program — marketing might not be the right word; it's more of a business development — is to make sure we have the data we need so that we can assemble the business cases and so that each airport can take advantage of a central database and an ability to sort of put together a compelling business case.

One of the airports might use that information to go after a European charter. We would probably focus, obviously, on Asia, because that's where we think there are some good opportunities for us.

D. Hayer: As a follow-up to what we were talking about — direct flights to India on a 787 — any idea when they might come in, in operation, so we can roughly get some timeline when they might be?

The second part with that is that people say when they go to security clearance, right now it seems to have a good quality of service. It's important when the guests go out that they are treated with respect — even when you're going through all the security checks, to keep that type of image and that type of attitude so that they decide to come back through our airport rather than going to some other airport.

T. Gugliotta: Sure. Yes, that's very important.

In terms of the 787, that program, obviously, has been delayed for a number of years. The first 787 has been delivered to ANA, an airline out of Japan, and they're flying that.

In terms of the carriers we're interested in, Air Canada has ordered 787s. But they probably don't get their first one until late 2013, and then it's going to take a couple of years before they get the remaining. So there's going to be some time before they can use that in India.

The only Indian carrier I'm aware of that's ordered them is Air India, but now they're going through some internal reviews in terms of whether they can actually afford to pay for the 787s they've ordered. It's not clear to me when they will actually get them or if they will still pursue them.

Unfortunately, the delay in the 787 has had a material impact on carriers planning for what we call thin-yield routes, which are the kinds of routes that really fit well for Vancouver.

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In terms of security, again, that's an operation that is managed by the federal government. Obviously, we work closely with CATSA, the agency that puts it in place, to make sure they have a customer service as well as a security focus. We feel that they can do both at the same time without sort of compromising the other. But it's always a bit of a challenge when you're dealing with a federal agency to make sure that they keep their focus on customer service as well as the security aspects.

R. Howard (Chair): Thank you, Tony. We've run you out of time, but we appreciate you coming out and talking to us this afternoon.

Next up we have the Surrey Urban Mission — Jonquil Hallgate. Jonquil, as you know, you have 15 minutes. At about the ten-minute mark I'll give you a heads-up, and you can stop and take some questions, or you can keep going — your choice. Over to you.

J. Hallgate: I wanted to start by saying that I volunteer in the community. I don't have a lot of financial background, and I'm not coming here to talk about the kinds of things that normally you might hear.

I'm here representing a community of people who live in poverty and homelessness. The mission started about 11 years ago, and at the time we served primarily middle-aged Caucasian men who were living on the streets for a variety of reasons, who happened to live with addictions.

Through the years that picture of poverty has changed dramatically, and today we see people of all demographics, all ethnicities, faith backgrounds, ages. Once upon a time it would have been unheard of to see somebody living with a developmental disability, somebody in a wheelchair, a senior coming through our doors. Those are the people who come through our doors every single day.

What I wanted to talk about was the investment by the province in human capital and the resources that are necessary to enable people who are on the ground working to make lives better — something that is a reality.

One of the issues in Surrey is that…. You all are aware of the fact that the population has grown immensely and that services are needed and there just isn't funding available. So one of the things I would like to espouse is that we look at population growth, projected growth, and take into account, as budgets are being constructed, that moneys are equitable in terms of the needs of the various regions as we continue to grow.

It's a well-known fact that health care in Surrey is in difficult circumstances. It's the same with education. Affordable transportation is a huge issue for folks who come to the mission, and affordable housing is even a larger issue.

During the winter when we have extreme weather, there is funding that goes to other areas of the province to open up heat shelters and other resources. That isn't what happens in Surrey. So people are in a position of living in the same kinds of temperatures but being unhoused during those periods of time.

Can we look at some way to encourage those ministries that are involved in those issues to look at, again, spreading the dollars so that people in all areas are receiving some funding to be able to provide similar services?

In north Surrey we have, at last count, 6,200 single-parent families. That number has probably grown substantially since that was released a year and a half ago. All
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of those families by definition, or most of them, live in poverty. They're all in need of affordable housing, which we don't have much of.

One of the things, when we sit around a table and talk about what can be done, is: is it possible to look at having some kind of a housing secretariat or some kind of an entity at a provincial level so that people like the mission or individuals, organizations, can tie into and look at the needs and then come up with some creative solutions to address those needs in our community?

A few years ago, prior to the Olympics, there was a big push to try and do something about the issue of homelessness in the province. The homelessness intervention project was developed.

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One of the really neat things about that project was that cabinet asked ministries to work together to collaborate to provide services that connected. It made a huge difference, and it housed hundreds and hundreds of people, because not only did we provide the Housing First model, where people had access to affordable housing circumstances, we provided services to meet needs and support them so that they could become independent in the community.

Unfortunately, what happens with brilliant projects is they end, and the funding disappears. Meanwhile the need doesn't. So again, one of the frustrations from our perspective is that when projects are initiated through government…. Could we look at having some kind of a link that says: "If this works, how can we make it continue so that it continues to benefit people in the community?"

It doesn't make a lot of sense, again on our end, to see a lot of money and effort and energy going to implementing something that ends, and then we still have the same problem or a growing problem.

I wanted to tell you just a quick little story. We have a young fellow who came to our summer day camp this year. His family emigrated from Nigeria six years ago — three children, mom and dad. Dad was working in a minimum-wage job but making ends meet.

About three months ago his mom was very ill in Nigeria, so he went home to Nigeria to see her before she passed away. There was a lot of conflict and strife in that country, and while he was there, unfortunately, he was mistakenly identified as someone involved in a conflict that had been ongoing. He was shot to death, leaving this young boy, his two sisters and mom with no source of income.

One of the things that the mission does is link wonderful people in the community with families and individuals who are struggling and enable people to continue to move forward in their lives. You can see that that family…. They have no source of income. Mom is not working. The children need all kinds of things because school is about to start. They have no food security. What happens to them? They become the next group of people who live in poverty.

I wanted to mention, too, in terms of…. We have many people who come in. I was just mentioning to Mr. Ralston that we have probably two families a day come in, who've emigrated from other countries — in particular, from India and from China. You make the assumption when people come here that they're able to sustain themselves for a while. When they get here, their qualifications, as you well know, don't always translate into being able to work in the field in which they're trained.

They end up using up the resources that they come here with, and they end up coming to a place like the mission, which is an entirely volunteer organization, to get diapers for their children, to get formula, to get clothing and furniture, because they can't sustain themselves because they're unable to work.

We keep creating more and more people who are living in poverty. So for all the numbers of people we've housed over the last few years, we're creating at this end more and more people.

So I'm just wondering if we can't have within each of the constituencies…. Could Mr. Ralston and Mr. Hayer and the rest of you have some kind of a committee made up of people who can come to you and say: "Here are some ways that we can address the emerging trends, the needs of people, which make a difference"? You can't have a healthy economy in British Columbia if the people who are needed to do the jobs and whatever aren't able to access education or health care or places to live or food to eat.

If we want to make this truly a family-friendly province or a person-friendly province, we need to absolutely be looking at the issues on the ground that non-profit organizations are dealing with.

One of the other pieces of the puzzle for non-profit organizations — not for the mission, because we don't receive government funding…. Many wonderful projects happen, and the agreements are on a yearly basis. By the time something is negotiated, and funding is in place, nobody ever really knows whether or not that's going to continue on into the future. Could you look at how to extend that opportunity so that there's not so much uncertainty for the people accessing services and for the people offering those services?

That's my little bit. If you have any questions, I'm happy to answer them.

[1330]

R. Howard (Chair): We do. Thank you.

J. Thornthwaite: Thank you very much for your presentation. One of the things that I asked the then Minister of Housing was exactly your question that you had made. I come from North Vancouver, and I asked — I'd seen all of these announcements in other areas of the province: why not North Van? He said it comes down to
[ Page 1553 ]
the relationships and moving things forward with the municipalities.

So in response to your suggestion about a so-called housing secretariat, how would you suggest the province…? What's your experience as far as boosting that relationship between, say, the province, the housing secretariat and municipalities if the municipalities have to be on board?

J. Hallgate: Well, I think there probably isn't a municipality in British Columbia that wouldn't agree that affordable housing for the folks living in that community is important. If there's some way to develop a system that identifies, again, what the emerging needs of people in communities are and then look at how, creatively….

For example, in Surrey we don't have a lot of SROs like Vancouver does. We don't have a lot of old motels or hotels that can be turned into housing for people who need them. Is there a way to network or create some kind of a system with landlords that supports landlords?

If, for example, the ministry in charge of income assistance had a program in place so that instead of landlords receiving damage deposits, it went into a pool, and if you as a landlord have a problem, you can apply to the pool and get your money back. One of the issues here in Surrey is that we have a lot of unscrupulous landlords who keep moneys. Then people who are on income assistance, in particular, end up on the street because they can't access a damage deposit or rent.

I think there are ways to deal with what's already on the table, but we're not very creative about it. In Australia they have a system where the money doesn't go directly to the landlord. It stays in a pool, and the landlord, within 48 hours, is able to access that money if legitimately they're entitled to receive that money.

A housing secretariat could address a variety of different issues and come up with some creative ways to utilize the dollars that are already being used but in a way that, at the end of the day, doesn't just benefit the landlord but the tenants.

M. Elmore: Thank you very much, Jonquil. Nice to see you. Thanks for your presentation. That's very compelling, and I know you do great work.

I'm interested…. You mentioned the changing face of poverty that you've experienced in terms of immigrant families coming in. Also, I'm very concerned to hear your experience with people with disabilities and developmental disabilities. Can you talk a little bit more about that — what you're seeing at the Surrey Urban Mission?

J. Hallgate: I started out many years ago working with people who are developmentally handicapped. Back in the day we thought we were pretty innovative and creative and avant-garde in providing services and opportunities for people to live independently with supports. And it seems that 30 years or so down the road, people don't have guarantees that they are going to have income supports or places to live.

It's distressing during extreme weather to have people come in who are living with developmental disabilities. It's distressing to have a 78-year-old man come through our door who is unable to pay for his rent in the Okanagan and who comes down here to see if he can get some day labouring kind of work because his wife of many years has passed on and his income no longer supports a small place to live.

Again, it seems to me that if in each constituency you have a team of people who address a variety of different needs that make a difference at the grass-roots level, then that could go forward. Instead of looking at everything within a box, we might have the opportunity to solve some of these challenges at a grass-roots level in a different kind of way that makes a difference.

We don't have a national housing strategy. If we have one — how many years? — ten years down the road to be able to have housing, so in the meantime…. People need housing today, so is there some way to encourage action through ministries that will enable people like us at the mission to make some of those things happen for people today?

[1335]

R. Howard (Chair): Thank you, Jonquil. We've run you out of time. We appreciate you coming forward this afternoon.

The Burnaby Teachers Association has withdrawn, so we have in their place the Progressive Contractors Association of Canada — Paul de Jong.

P. de Jong: Good afternoon.

R. Howard (Chair): Welcome, Paul. As you probably know, you've got 15 minutes. At about the ten-minute mark I'll give you a heads-up. You can stop for questions or go straight through — your choice.

P. de Jong: There should be some time for questions.

I want to begin by thanking you for the time that you provided me. I appreciate the work that you're doing on behalf of all British Columbians, the work as a standing committee, as you prepare for another year of navigating the challenges.

Just a quick introduction of myself, Paul de Jong. I'm the executive director of the Progressive Contractors Association of Canada. We are, obviously, a national organization with offices in Ontario, Alberta and British Columbia. We are the voice of the progressive, unionized contractors in B.C. and Canada's construction industry.

We represent thousands of skilled construction workers, primarily unionized by alternative unions such as
[ Page 1554 ]
the Christian Labour Association of Canada. Across Canada we have as many as 60 member companies employing over 20,000 workers. Here in British Columbia our members — such as Kiewit, which is probably the most notable of our members — have worked on very notable projects such as Sea to Sky Highway and the Port Mann Bridge.

Our work across Canada as an association, and in British Columbia, is to pursue and ensure fair access to work opportunities for our contractors by promoting a legislative framework and industry practices that create a level playing field so that everyone who participates in the construction industry, whether they are unionized or non-union, has equal opportunities to pursue the work and make the province stronger.

Here in British Columbia, as I mentioned, our members have worked in a number of projects. We are very proud of the fact that our projects come in on time and on budget and we work safely, making sure that our workers get home at the end of each day.

We believe that in B.C., no surprise, one of the key backbones of our economy is the construction sector. There are many key sectors, admittedly, in our economy, but construction is critical. Without a vibrant and prosperous construction sector, other sectors tend to founder. In fact, construction, as we understand it, is a leading sector at job creation in B.C. with 4 percent growth in 2011. It's one of the leaders in business investment.

We recognize, as we talk about some of the financial issues that affect our province, that there are a number of elements that are sort of within our control but also many that are outside of our control. Global debt crises that we've seen — many of which are with trading partners, investment partners — have an effect on us, and those are beyond our control as a province and as a government. We recognize that.

We believe that the B.C. government maintains a competitive tax environment, allowing investment. We do urge continued caution on government spending. Notwithstanding all these things — whether these are internally related issues, in terms of how we manage our own economy and also how we interact with our sister provinces in the federation, or international — these are uncertain times, economically and otherwise. We understand that some of the key focuses for the government are working on the infrastructure of our province, on developing and maintaining jobs for British Columbians and also security for B.C. families.

I just want to go through a couple of those points and end with one of our key focuses. Beginning with infrastructure, we believe that strategic investment in infrastructure is critical. Continuing to do some of the investment such as Sea to Sky and Port Mann, which have been great generators of jobs, have been hallmarks of the province with respect to tourism…. The flow of goods and services across the land has been critical.

In respect of jobs, we also believe there should be continued investment in training the workers of the skilled workforce, that there should be as much attention paid as possible to the mobility of workers across provincial borders so that workers will be inclined and interested in working here; also, a good relationship with the federal government departments with respect to mobility of incoming workers, immigration and, if necessary, temporary foreign workers so this is done in a correct and judicious manner.

[1340]

One of the key areas for the PCAC is relating to infrastructure and jobs but also creating security and safety for families in British Columbia. There is a section of the British Columbia Labour Relations Code called section 19 that deals with a particular area, which may seem a little bit obscure but has a fairly strong effect on the investment and the ease of operation in the construction industry. It has to do with a regulation around what's called open season.

Open season historically has been a part of any labour relations framework and is a necessary part of it. Open season allows unionized workers to either opt out of that unionization in a given period of time or switch unions. PCAC believes and supports that unionized workers have a right to unionize in the first place and should have a right, a timely right, to enter into alternate arrangements as they see fit.

But as you may not know, in British Columbia we have the only jurisdiction in Canada in which that open season occurs every year. Every seventh and eighth month of the collective agreement in each year is subject to this open season in which another union can come in and cause a raid period to happen, whereas in other jurisdictions in Canada — Alberta, Ontario, Saskatchewan and others in the east — the raid period, or the open season, is every two years or sometimes every three years.

We believe, in our experience across the country, that every two years or every three years is a judicious way of affording the employees — the unionized workers — the proper right to have some examination of their collective bargaining relationships, but that every year that open season is causing a tremendous amount of distortion and even confusion in the minds of the workers.

Imagine if you will — I realize that this is a bit of thin ground to walk on — if as politicians you had to suffer the indignity of having your own positions tested after one year of being in position. It just doesn't allow going back to the union environment for this.

A Voice: It's like recall.

P. de Jong: Well, recall. That's what it's called. And there's a time and a place for that. But when it comes to developing relationships with your constituents, which a union very dedicatedly does, it takes time. It takes more
[ Page 1555 ]
than just a passing season. The workers need to become adjusted to how that union represents their interests on a day-to-day, month-to-month and year-to-year basis. And when that time frame is measured on a one-year basis, it becomes very difficult.

There are other issues that may happen. So when we're talking about investment in British Columbia we're talking about companies who want to come in and work with us in partnership to help us develop our natural resources, to build our economy. These owners increasingly become very risk-averse when it comes to a labour relations environment that doesn't have some type of reasonable feature that they can rely upon. So there's a risk aversion that occurs.

There's an uncertainty in the planning process between owners, contractors, workers and unions. There's very little level playing field and sort of the charted terrain on which the organizations can begin to build the relationships that are going to create a strong, healthy, lasting construction project that's going to get done on time and on budget. And so to have the uncertainty of an open season every year begins to cause that disruption, which interferes with the planning cycle.

There's also the possibility of protracted labour disputes. It's not wrong to have labour disputes. In fact, it's part of our fantastic democratic heritage to allow employees to speak to other unions, for other unions to speak to those workers. That should always be protected, and that open season, as I say, is something that we protect in every jurisdiction in Canada. But to have those labour disputes enter into a workplace on a yearly basis doesn't really make sense in terms of the workers' ability to focus on the job at hand. Instead, there's more — if I may say the word — politics that goes on, small-p politics, where there are more issues about who's with who and who's siding with whom rather than getting to the work at hand.

We believe, as an organization, that productive, cooperative, collaborative relationships between workers and management is a good thing, which is a bit of an unusual take because most contractor groups may look at union-management relationships with a bit of a question mark. We actually believe that these can be healthy.

[1345]

But we believe they need to be healthiest in the context of a labour relations environment that takes away the uncertainty, that removes the overwrought regulation that unfortunately we see in section 19 of the B.C. Labour Relations Code.

In summary, the PCAC believes that one of the key frameworks going forward is that we address the issue of the open season that's happening on a yearly basis in our B.C. Labour Relations Code, that we give some fair attention and process to not altering it in the sense of removing it but changing it so that it's more in line with our other provinces that we do work with. Other provinces have struggled through the same issues that we have here and have concluded that a bi-yearly or once-every-three-years open season creates the kind of harmony, the build-up of relationships that are important in the workplace, allows owners to manage their risk, increases investment and does the things that we need to have here, which is create a prosperous landscape to create job creation and security for families in a strong infrastructure.

R. Howard (Chair): Paul, you're at 11 minutes — just so you know.

P. de Jong: I'll leave it at that. Done.

R. Howard (Chair): Okay. We have some questions.

B. Ralston: Thanks very much. You mentioned training. Can you give some examples of the typical training provisions in the collective agreements that you administer? I'm thinking that some collective agreements have a stipulation about the number of apprentices that might have to be hired. And can you also talk a little bit about your relationship to the ITA and the Red Seal process? You mentioned interprovincial mobility. Obviously, training people to the level of the Red Seal is one way of guaranteeing interprovincial mobility.

P. de Jong: Our relation to the Red Seal program at this point is fairly elemental. Our contractors with the unions that they're involved with manage most of those affairs. We support the creation of the Red Seal as the mechanism by which that mobility is achieved.

The training that our contractors conduct with the unions that they deal with, primarily the CLAC, is oriented in two manners. One is to create the mechanisms internally by which to ensure that workers can be credentialed, and the other one is more on soft skills to ensure that supervisors have more sophisticated abilities to lead large workforces in the most productive manner. It goes back to that labour relations mindset that a good job site is one that is well regulated and has the correct mechanisms in place to manage disputes.

A lot of the soft skills, like substance abuse awareness and detection on the job site and mental illness awareness and detection on the job site, are critical to us. We kind of span a little bit of two grounds. One is more the technical training towards credentialing, but we also spend a fair degree of time focusing on more of the soft skills of career strengthening, if you will, along the way.

D. Hayer: Thank you very much, Paul, for your presentation. My question is: how do the other unions feel about sort of stopping the open season every year to maybe every two or three years or raiding other unions every year to every two or three years? Do you have unanimous support or somewhat support? How do they feel generally?
[ Page 1556 ]

P. de Jong: I'd have to let them answer that themselves. But I would have to believe that they, too, experience the kind of disruption that I spoke of. Just today I heard of another incident of two unions that are unrelated to the CLAC or construction sector factually. Again, I would support the idea that these types of interactions need to be part of our Canadian landscape. Workers need to struggle with each other and with the representation that they have taken on to make sure that representation is done in a good manner.

I would believe that any of the other unions would support the idea that the open season needs to be laid out in such a framework that (a) it occurs, but (b) it doesn't occur with such frequency that it causes the disruption that they themselves now have to manage to their consternation.

I would believe their answer would be that they would say this is a bit much and that we should take a look at our other provinces that we deal with — Ontario, Alberta and Saskatchewan. Quebec has some different regulations, but generally speaking you do not see anything other than two- or three-year cycles for open season in not just construction but all other sectors as well.

R. Howard (Chair): Thanks, Paul. We've run you out of time. I've left MLA Pimm on the question list, but he'll have to catch up with you outside of this.

P. de Jong: Thank you for your time, and I do invite any questions or follow-up that you may want to take either as a part of this committee or separately. I'd love to hear from you and interact with you. I'm in Victoria. I'm easy to find. All the best in your work.

[1350]

R. Howard (Chair): Next up we have the B.C. Dental Association — Jocelyn Johnston and Dr. Hank Klein.

Welcome. Just as you're getting set up, you're probably aware you have 15 minutes. At about the ten-minute mark I'll give you a heads-up, and you can stop for questions or go straight through — your choice. The mike is all yours.

H. Klein: Thank you very much for inviting us to this meeting. It gives us an opportunity to present dentistry's position to you.

B.C. Dental Association is the recognized voice of dentistry in British Columbia and represents 3,100 general practice and specialist dentists. Dentistry contributes $1.8 billion a year to B.C.'s economy and directly employs approximately 15,000 dental professionals, including the 3,100 dentists, 6,000 certified dental assistants and 3,000 dental hygienists. BCDA and the government have partnered on many initiatives, such as the $2.5 million early childhood caries campaign which ended in 2009.

There are two legislative changes that dentists are seeking. Amending the Limitation Act to reduce the ultimate limitation period for dentists to seven years. There is no cost to government with this change, but it will eliminate unnecessary costs in providing dental care. Dentists and other professionals in B.C. have a 30-year ultimate limit period, the longest in Canada. The ultimate limitation period in Alberta and Saskatchewan is ten years and Ontario, 15 years. The exception in B.C. is physicians in hospitals that have only a seven-year limitation period.

This discrepancy between the medical colleagues and hospitals creates an inequity and uncertainty for dentists treating in hospitals. In hospitals dentists are essentially on the hook for 30 years, while physicians, after seven years, are off the hook, especially in cases where both are treating the same patient.

The reality is that virtually all claims against dentists are made within one year of providing treatment. The 30-year period is unnecessary and places an undue burden on dental office resources. Additional staff time and storage facilities are required to house the records and maintain their confidentiality. A general practice dentist stores up to 10,000 sets of records and models and an orthodontist up to 20,000 sets of records and models. Reducing the ultimate limitation period would resolve differences in risk between dentists and physicians and would greatly enhance the efficiency of dental resources in B.C.

Secondly, B.C. dentists wish to have the Hospital Act amended to provide admitting and discharging privileges for oral and maxillofacial surgeons. Currently the oral surgeons must co-admit their dental surgery patients with a physician. Not only does this add redundant costs to the health care system; it places patients at risk. In an emergency involving hospitalized dental patients there can be confusion around who is the responsible practitioner, the admitting physician or the oral surgeon — who is responsible for the patient's care.

There are increased costs to the system as both the physician and the oral surgeon must conduct essentially the same physical exam. Oral surgeons have an additional four years of hospital-based training beyond their dental degrees. Providing admitting privileges to oral surgeons will increase administrative efficiencies, eliminate duplication and enhance patient safety.

Access to care is an issue throughout the province. Untreated dental disease can result in ER and OR visits, increasing costs to the health care system. These costs can be reduced through prevention. Current economic conditions have increased the access-to-care challenge for vulnerable populations in B.C.

Dentists have stepped up to improve access to care through a number of initiatives, including 18 not-for-profit clinics that treat an average of 4,000 patients monthly for emergency pain relief and basic services such as hygiene, fillings and dentures. Many of these clinics are staffed by volunteers, dental students or residents and staff dentists.

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[ Page 1557 ]

These clinics rely on billings to the Ministry of Social Development and subsidize care for the working poor who have no government or private dental coverage. Approximately 80 percent of the members are providing care to ministry clients, even though their rates are below 60 percent of the current dental fees, the second-lowest level in Canada.

Welfare dental fees have not been increased since 2007. The expenses-to-gross ratio of the average dental office is 65 percent. Many offices charge ministry clients additional fees to cover costs or, alternatively, limit the number of clients they have as regular patients to minimize the economic impact. An increase in ministry fees will not only ease the burden of ministry clients but also enhance the ability of the not-for-profit clinics to treat more risks in patients.

Access to care is a concern for children too. The economic conditions and the recent cuts to preventative dental services for ministry clients and Healthy Kids have placed young children at risk for severe dental diseases. Untreated decay can result in increased ER and OR visits, representing a cost to the health care system. B.C. Children's Hospital is reporting a substantive increase to emergency dental care for children, from 300 cases in 2005 to over 1,200 cases in 2011. While prevention is the key to long-term success, unfortunately it is too late for many of these children who require extensive dental treatment. Vancouver is not alone, as pediatric dental visit wait-lists exist throughout B.C.

There is an immediate need for increased collaboration between the Ministries of Social Development and Health to enhance the community dental partners program; increase the number of private GA facilities that accept more children throughout B.C.; increase the income threshold for families to qualify for Healthy Kids; provide additional coverage for children with dental caries to prevent further hospitalizations. There are potential savings in the health care system through investing in dental health promotion and prevention care.

Low-income seniors also face access-to-care challenges. Given the frailness and complex medical conditions of many seniors, poor dental health can affect their quality of life and result in costly emergency dental-medical issues.

The BCDA supports a dental plan for low-income seniors, as recommended by the Premier's Council on Aging and Seniors Issues. As seniors begin their retirement, they often lose their dental benefits. Unfortunately, this occurs at a time when their oral health is critical to their health in terms of nutrition and social well-being. Increased frailty, limited mobility and medications can accelerate dental and gum disease, causing pain, infection and bleeding and can lead to hospitalization. For those in long-term care there's a higher risk of aspirated pneumonia associated with dental disease.

A dental plan for low-income seniors would cost $24 million annually, based on the existing Ministry of Social Development's schedule. If funds are limited, a palliative dental plan for seniors in long-term care facilities would cost $6 million annually, based on the existing Ministry of Social Development's schedule.

Another group we are concerned about are those individuals with facial anomalies. Funding restrictions have limited the access to prosthetic care for childhood survivors of cancer and patients with ectodermal dysplasia. While the number of patients is small — 30 to 40 cases annually — the cost is prohibitive, anywhere between $10,000 to $60,000 per case. Current funding is limited, and there are gaps in coverage among syndromes and conditions.

For example, core funding of $100,000 for the B.C. Children's Hospital ectodermal dysplasia clinic has not increased in over five years, while the number of patients has. An additional $266,000 in funding was secured through BCDA and MSP negotiations, but future considerations are dependent on negotiations.

Another example is childhood survivors of cancer who often have an undeveloped jaw when they mature. Their prosthetic treatment must wait until they mature, but by that time they are no longer registered and the funding is on an ad hoc basis.

[1400]

Similarly, oral cancer patients can wait up to four years for their prosthetic care. The BCDA has fundraised and reduced wait-lists, but this has proven to be a stopgap solution. There is no long-term strategy to treat and fund all syndromes under one umbrella. The B.C. Cancer Agency, UBC, B.C. Children's Hospital support a global budget to provide prosthetic care for patients, for facial anomalies, with the intent of developing expertise to support these patients and rationalize treatment. One-time funding of $750,000 is requested to reduce wait-lists and ongoing annual funding of $450,000 to ensure that patients receive treatment.

Finally, the B.C. Dental Association supports a B.C.-Canadian health measures survey. The results of the survey will allow government and the BCDA to better allocate future resources, making oral health provision more efficient. The 2009 Canadian health measures survey examined both the oral and general health of Canadians. This national survey under-represents B.C., which has an older and more ethnically diverse population than national figures.

The changing demographics of B.C. will create demand as the number of seniors increases and they have decreased access to dental insurance. The B.C. Dental Association, in cooperation with the Canadian dental officer in the Armed Forces, can conduct a more in-depth survey of B.C. adults and children for their dental portion only. Each organization will contribute $100,000 to the $600,000 project. The remaining $300,000 is requested from the provincial government.

I thank you very much for your time, and I hope you receive our report.

R. Howard (Chair): That's great, Doctor. Thank you. Just a few minutes left and a long list of questioners.
[ Page 1558 ]

D. Hayer: Thank you very much A very good, detailed presentation. My question is: when you talk about the limitation period, in the last ten years how many cases were there against dentists? You said that normally, if there is a case against a dentist, it would be within one year. In the last ten years were there any cases after ten years or 15 years, after seven years? Do you know?

H. Klein: Not that we're aware of. No.

J. Johnston: No. Dentistry is covered by CDSPI malpractice insurance. We checked with the malpractice carrier, and all complaints were made within two years.

D. Donaldson (Deputy Chair): Thanks very much for the presentation. I'm from a rural area, and like many rural areas in B.C., we're experiencing difficulties with people being able to access a dentist.

Can you make a link between the legislation that you're proposing here around ULP coverage and perhaps the ability to see more succession — more younger dentists — in the profession? Is the liability insurance onerous, for instance? Is it a barrier to getting more dentists? Have you heard anything else around why this ULP legislation might not be looked upon as favourable?

J. Johnston: In the case of dentistry, I'm not sure that…. It really hasn't proven to be an issue. When it comes to malpractice…. Let's separate the two. Every dentist in B.C., obviously, has to have malpractice, and 99-plus percent get their malpractice through CDSPI. So we're fairly comfortable about what the issues are and can work with the malpractice carrier because they're a cooperative, through the B.C. Dental Association and the Canadian Dental Association.

Do I see an opposition on the ULP? The only possibility would be in the case of a massive earthquake, where it has been suggested that dental records would be required. But the truth is that the most important records are the most recent records, not 30 years' worth. That's one issue.

Second, DNA has made considerable advancements. Though dental records are good for immediate identification, as we saw in Thailand with the tsunami, you still need DNA to resolve it. That would be the only concern about passing the ULP. But again, we have actually made a presentation, working with the RCMP, to find a way to, when records are being disposed of at an earlier basis…. Because you want the most current records, not the history, when you're doing identification or forensics.

I'm not sure that answers the question.

R. Howard (Chair): Sorry. Time for one last question if we're quick here.

[1405]

B. Bennett: Thanks for your presentation. The ultimate liability period — I can't remember whether this committee has ever recommended that it be changed or not. It's something that I'm going to recommend we have a look at because it does have a negative impact on the economy generally in terms of forcing people to keep records for longer than what they should have to.

On the second issue that you brought up, amending the Hospital Act, is there not another way to manage that situation that you describe? You described a situation where a physician and a dentist co-admit, and sometimes there's confusion as to who's responsible for the patient. Does that require a change of legislation or a change of policy within the health authorities?

J. Johnston: I think most hospitals have found a way to work around it, but if ever there was a case, there would be this liability issue of who was responsible for the patient. But I believe it's appropriate that patients, when in an emergency situation…. There shouldn't be any confusion brought by legislation when it comes to who the treating physician is and who can deal with the issue.

H. Klein: Ultimately, it is a saving to the system. I think that's the point we're trying to make here.

R. Howard (Chair): Well, thank you. We've got some questions we'll have to leave on the list — MLAs Stilwell, Pimm and Elmore. But we've run you out of time, so we'll have to catch up with you outside of this.

H. Klein: We have enclosed some more briefing, and if there are any other questions, we'd be glad to answer any of those to any of the members of your committee.

R. Howard (Chair): Perfect. Thank you very much for taking the time.

Next up we have the Canadian Federation of Independent Business — Nicole Nash and Shachi Kurl.

Welcome. I am sure you know you've got 15 minutes. I'll give you a heads-up, if I can, around ten, and you can stop for questions or go straight through — your choice.

S. Kurl: Just make big hand movements. Big hand movements will be good.

R. Howard (Chair): Okay. Welcome.

S. Kurl: Well, thank you, committee members, and thank you, Chair, for your time. As most of you know, the CFIB is the voice of small business in B.C. We're celebrating our 40th anniversary as a non-partisan, not-for-profit advocacy organization, and we speak for 10,000 members here in British Columbia.
[ Page 1559 ]

If you look at the presentation that we've put together for you…. If you go to the slide that talks about small business September economic indicators, basically, what does that say? It's how things are looking for small business owners in B.C. at the moment. In a word, I would describe it as "meh."

We have to survey our members every month to really measure their level of optimism, and what we're seeing for September is that optimism is at a one-year low. On the jobs front, that means that more employers right now are looking to decrease employment levels rather than increase them, although most are planning to leave things unchanged.

The cost concerns for business owners for the third month in a row — and this is really standing out for us — continue to be fuel and energy costs. The next major concern — big surprise here — is tax and regulation. We'll have a little bit more to say about that in a moment.

It's against that backdrop that we are starting to look at what small business owners determine to be their priorities when they ask government to set priorities for the budget in February. Really, what we're hearing from them is that we would like them to go back to the basics by controlling spending, getting out of deficit as soon as possible, reducing debt; and on the job creation side, really getting out of the way of employers being able to create the conditions that enable jobs and employment in this province.

How do you do that? Well, not tremendously exciting and not things that you haven't heard us say before, but control spending. Then on top of that, one way to get there is to watch wages in the public sector. That's the one thing that we tend to hear from our members quite a bit.

Now, B.C. isn't the worst when it comes to that differential between what the average private sector employee makes for the same work that those in the public sector are doing, but we see a lot of room for improvement on that front over time.

On the benefits side, we do have concerns around ongoing demographics. Basically, we're looking at a situation where baby boomers — nowhere near your age, of course — are going to be retiring at some point, and we are worried on behalf of our small business owners, who are employers themselves. But who's going to be paying into a system that is going to have more and more burden placed upon it?

So going from there, we would also look at issues of pension and equities, and we think that before taxpayers should be asked to pay more into the CPP system, we should start to look at other ideas around it.

[1410]

I'm going to take you now on a short trip to grumpy town, which would be family day. As many of you know, from the small business point of view, family day is a really hard hit for family-run businesses. We've estimated that labour costs alone for the average small business owner will total about $1,135 per employee per day. So that's quite a bit.

What we think and what we hear from our small business owners is that there are things that could mitigate or soften that hard hit for our employers. Those would be things like a family day tax credit or extending the training and innovation fund as well.

We could also look, perhaps, in the implementation of family day. Would we see an Ontario model, where employees would have to pick between one of two statutory holidays so that the number of net holidays doesn't increase over time? So those are some possibilities on that front.

We do have some other asks, shockingly enough. The big one for us is keeping the promise to lower the small business tax rate to zero. This is something that was a promise on government books, and it was scheduled to be eliminated by July 1, 2012. We agreed to see that delayed or put off, pending the survival of the HST. Of course, we all know what happened with the HST. With that off the table, we kindly ask that this promise be kept and expedited as soon as possible, and that we see the elimination of the small business tax rate.

Earlier I talked about the burden that energy and fuel costs are placing on small business owners. To that end, and especially here in Metro Vancouver, where we are now anticipating a 2-cent-a-litre gas tax in order to fund some transit projects, that we see a freeze of the carbon tax after the next increase, slated for July 1, 2012…. After that we're not suggesting that it be scaled back or eliminated in any way, but just give our small business owners some relief on that front, as they are feeling particularly burdened by that.

Also, with the increase of the PST, the big ask from small business owners is to simplify, simplify, simplify this tax. This is a tax that, before it was eliminated and replaced with HST, was one that was driving small business owners to distraction. I'll give you a couple of examples of the things they had to negotiate and make their way through.

You had an orange safety vest? That was PST-exempt. You had a yellow one? You charged PST on that. Yellow slicker — PST-exempt; red slicker — charge PST. I don't know about you, but that's the type of thing that would make me cry, and I think it made a lot of small business owners cry as well. They are really looking for some administrative changes and improvements before this tax comes back, when it does come back.

A couple of things that we'd like to acknowledge that have been very encouraging for us on behalf of our members, and they thank you. We saw earlier this year that 82 percent of our membership backed an independent municipal auditor general. We are heartened to see mention of it and promise of it in the throne speech, so thank you. We look forward to hearing the details of how this office is going to be set up. For us, we would
[ Page 1560 ]
like to underscore the very value of this in it being independent and answerable to taxpayers.

Also, we would like to acknowledge the continued leadership that British Columbia is showing through deregulation and with the commitment — which, by the way, was the first in Canada — to bring in legislation requiring an annual report on regulation. I'm sure when you all go back to the House next week, you will be eagerly awaiting the introduction of that legislation. I know we will be.

With that, we'll wrap it up and take your questions.

R. Howard (Chair): Thank you, Shachi.

D. Hayer: Thank you very much. It's nice to see you in your new job, new role.

My question is about family day. What percentage of your members are against family day? You also said 42 percent supported it if the government decided to help pay for that, and I had heard from some e-mails to my office. What are some of those suggestions you're looking at? Is it a credit, you were saying? Or are there some other things that can mitigate it?

[1415]

S. Kurl: There are a couple of things. When we first tried to take the temperature on this initially, we definitely saw that about 62 percent were strongly opposed to family day, and we had another large percentage that was somewhat opposed.

I think, again, this isn't about not recognizing the value of family life balance and work-family balance and that type of thing. But really — in the face of ongoing minimum wage increases which have to be factored for and accounted for, in the face of the uncertainty around taxation right now as we move back towards PST — I think, for family businesses or for small businesses in general, they're really saying: "Where am I supposed to find the money to pay for this? It doesn't matter if I open or if I close. I have to make enough sales in order to mitigate these costs, or I make the choice to mind the store myself all day, and that's taking me away from my own family."

The idea is of a family day tax credit, basically being able to write off that one day, assign a day against which your earnings are written off; or the idea of increased funding around some job generation, the innovation tax credit; or looking at ways again, as mentioned, as in Ontario, where employees have to choose between taking either Remembrance Day or Family Day, so that there isn't a net increase in the number of days overall.

Again, this isn't about not supporting employees, but it's about dealing with the very real costs of having to pay for this day. It is very much being felt among our small business owners that it is basically a great idea that's being fiscally downloaded onto them and their backs.

B. Ralston: One of the aspects of the PST that was done away with when we moved to the HST was the paying of a commission for collecting the PST. Indeed, in October 2008 it was doubled. When you say, "Simplify the PST," what's your view on the return of that commission process to merchants and your members for collecting the PST?

S. Kurl: Yes, please — and more. Absolutely, they would like to see that commission return. I didn't mention it for the sake of time, but you will see a full submission from us by the end of the week, and we will have more to say at that point. Absolutely, we want to see the return of that commission, and we're prepared to negotiate about price.

J. Thornthwaite: Thank you very much for your presentation.

I just wanted to clarify your comment — plus I know that I read your article in the Sun, as well, on the weekend — about the actual cost. You said $1,135 per employee.

S. Kurl: Sorry. I misspoke just then. It's per holiday, as opposed to per employee.

J. Thornthwaite: Okay. All right, thanks.

D. Donaldson (Deputy Chair): Thanks for the presentation. A question again around the slide "Simplify PST before it returns." The government is on record as saying they'll…. And you've reflected this in March 2013 as saying the GST-PST system will be brought in, in about 18 months, which is longer than it took to implement the HST.

I'm curious. Did you not question your members about that? It has been brought up as an uncertainty. Would your members say: "Reduce uncertainty by bringing in the GST-PST system" — as the referendum pointed out — "as soon as possible"?

S. Kurl: I think, for our small business members, that having a hard date is the certainty.

As you know, while our membership was overwhelmingly in support of HST and the system that was in existence up until the point of the referendum, not everybody was. While you have some of our members who are just absolutely ecstatic about the fact that HST is going away and will be replaced with PST, particularly in the hospitality and restaurant sector, others are really in no rush to see this tax come back, and HST is the one that has been working for them.

In terms of certainty, it's not necessarily how soon, or how long it's going to take. It's more about: if you're
[ Page 1561 ]
going to do it by this day, stick to this day so that everybody can plan for it and everybody knows about it, and there is certainty from that perspective.

P. Pimm: Thanks for the presentation. I kind of focus on the carbon tax. I see that you've got 76 percent of your small businesses that don't want to see any further increases. That seems to run similar with the Pembina Institute. They had 51 percent that didn't want to see an increase.

My question, though, goes right to: how is the carbon tax affecting the greenhouse industry?

S. Kurl: That's a great question.

[1420]

N. Nash: It's devastating them. It is one of the hardest-hit industries when it comes to the carbon tax. There is no offset for them, so no matter what you give back in taxes, it doesn't matter. We have one small business owner that it added $100,000 a year. He's not getting that back in taxes, so it's definitely very hard hit. He's also a very green business, so it seems almost…. It's a little odd.

R. Howard (Chair): Thank you, Nicole. Thank you, Shachi. Really appreciate your taking the time to come out this afternoon.

S. Kurl: Thank you. I think we wrapped that up in 15 minutes.

R. Howard (Chair): You did. Next up we have David Noshad.

D. Noshad: Good afternoon, and thank you for the opportunity to present to you today.

R. Howard (Chair): Welcome, David. As you probably know, you've got 15 minutes. I'll give you a heads-up around ten.

D. Noshad: My name is David Noshad, and I'm president of the Canadian Bioact Technology Consulting Co., a part-time faculty instructor at the department of natural resources at Thompson Rivers University and research scientist at the University of Victoria.

I'm here to submit my recommendations on two specific items that I strongly believe can help sustainable development of our magnificent province.

The first one is the use of environmental friendly products. Over 26 percent of all landfills in North America are occupied with contaminants from plastic and Styrofoam products coming from our food-packing industry. Packaging waste in all North American landfills includes discarded food packaging made from fossil fuel and petroleum-based plastics and Styrofoam. That contributes to over 17 percent of our local greenhouse gases and over 13 percent of hazardous wastewater associated with chemical leaching and by-product decomposition.

Eliminating waste at the source rather than after it has been created is commonly referred to as source reduction. Environmental experts on sustainable landfill management agree that directly addressing source reduction would directly lower immediate manufacturing costs for companies throughout the food packaging supply chain and tax expenditure for municipalities, as costs for environmental recycling programs are exceedingly growing in cost annually.

Over 57 percent of all petroleum-based plastic and Styrofoam packing products in North America are consumed to produce single-use food packaging for the fast-food industry, most of which becomes waste shortly after the goods are purchased and ends up in our landfills. Over 30 percent of municipal solid waste in the United States contains discarded single-use food packaging originating directly from the restaurant and fast-food industry.

I strongly suggest allocating incentives to companies that utilize technologies to produce fibre-based food packing products. It will accomplish the following: alternative input for the up to 26 percent source material of carcinogenic plastics and Styrofoam into our landfills; diversifying up to 23 percent of our B.C. pulp and paper industry by opening up new fibre-based packing products, which will introduce the B.C. forest industry to the international market. With the strategy complete, the advantage is becoming global leaders on landfill management and climate change solutions.

A second recommendation is about sustainable development in B.C. natural resource and agriculture sectors using applied research approaches. Fundamental to sustainable development is a common understanding that development is essential to satisfying human needs and improving quality of life but that it must be based on the efficient and responsible use of natural, human and economic resources.

[1425]

B.C. communities depend on the natural resources and agriculture sector for their livelihood. In no other sectors does the concept of sustainable development mean more or hold such promise for positive, long-term socioeconomic outcomes. We should recognize that sustainable development is an opportunity to harness our knowledge and innovation to achieve societal goals and economic success. Underpinning my vision is the principle that environmental, economic and social performance is increasingly driving the competitiveness of the B.C. natural resource and agriculture sectors.
[ Page 1562 ]

I suggest allocating more financial support to applied research and development projects for B.C. Ministry of Forests, Lands and Natural Resource Operations and B.C. Ministry of Agriculture to aim at increasing economic opportunities for B.C. forest and agriculture industries; adding economic value to these sectors through innovation; integrating innovation efforts and institutions into a more effective provincial system; and addressing challenges and building on new opportunities for forests- and agriculture-based B.C. communities.

R. Howard (Chair): Thank you.

B. Ralston: Thanks very much for a thoughtful presentation and a good idea on the single-use food packaging. You mentioned in general terms that it would lower manufacturing costs. I know that this is probably not your field as a scientist, but do you have any sense of how much you would save by switching to fibre-based packaging products?

D. Noshad: I talked to company owners, and basically they gave me some numbers, but I didn't bring the numbers with me here today. I can ask them, and I can submit the numbers, because I want to be sure about the numbers that I am submitting to this committee. I can ask them and send it to you.

B. Ralston: Sure. I think we'd appreciate that, because it seems like a good idea. I mean, the obvious objection that the fast-food industry might make would be that it would be more costly. So that would be perhaps helpful to at least begin a discussion.

D. Hayer: Thank you very much, David. Is there any other province that is following these recommendations, especially in the food packaging, to be more environmentally friendly?

D. Noshad: Those ones that use fibre, you mean?

D. Hayer: Yes.

D. Noshad: Yes, there are some companies here. Actually, they are originally from Sweden. I know some of them. But they have problems here in B.C., in Canada in general, and the reason is that they cannot compete with plastic-based manufacturing companies. It's more expensive — like around, I think, seven to eight cents per package. It's more expensive than plastic-based, so they cannot compete.

D. Hayer: How about in the United States? Are there some states that are sort of making it easier or having regulations or legislation saying people should be using more environmentally friendly packaging?

D. Noshad: There are some in Europe, but in North America I don't think so. I couldn't find any. In Europe, yes, they're encouraging that. And especially in B.C., I think it's very useful because it helps the forest industry in another way. We are basically one of the provinces that produces wood and pulp, so it can help us in that way too.

D. Donaldson (Deputy Chair): Thanks very much for your presentation. With regards to your recommendation 2, we know that in the last decade the applied research area in Ministry of Forests, the research team, has been taken apart through government decisions and, as well, that we have the lowest per-capita spending through the Ministry of Agriculture to support farmers of any province in Canada.

So I was wondering if you've got any examples of how we're losing out on opportunities because, as you say here, the financial support for applied research and development in the ministries isn't there.

D. Noshad: Okay. What I'm trying to say is that we can make the system more efficient. I think the system — and I'm not blaming government or any of these ministries or any person — is not efficient. Universities are doing a more academic type of research. Let me give a practical example.

I discovered a new disease that was originally from ginseng farms in China, but now we have it in B.C. — okay? It can basically infect carrots and other agriculture products and some of the forest trees. The problem is that the money that goes to universities is more for academic and pure science research like genomics and other types of research.

[1430]

People in the ministry are very busy and working. They have lots of things to work on for their daily-based work, operational things, and they have a budget for that. Then we have federal government research scientists that are working on basically creating policies, not on solving these kinds of problems. This is not their job.

So I was thinking: whose job is that? My suggestion is to either invest in companies or to ask a department in the Ministry of Natural Resources or Agriculture to be in charge of supervising this type of research — to be coordinated, because I feel it is not coordinated.

We have pure scientific and academic research in universities. Then we have basically policy-making kinds of research in the federal government research labs. Provincial scientists are very busy because we have so many problems in our forests and natural resources. I think they're working very hard — all these sections. But we need coordination here, someone — a department or something — to coordinate this research, to solve some of these problems. Who is in charge of that? That's my point here.
[ Page 1563 ]

R. Howard (Chair): Excellent. Thank you, David. Really appreciate you taking the time.

Next up we have the ad hoc committee for funding for Surrey schools — Linda Stromberg, Jordan Malcolm and Jessie Stromberg-Smith.

Welcome. You probably know, because you've been sitting there for a while, you've got 15 minutes. At about the ten-minute mark I'll give you a heads-up, and you can take some questions or go all the way through — your choice.

L. Stromberg: Thank you very much.

Ladies and gentlemen of the committee, let me start by taking you on a trip into the future. Not far. In fact, just three years into the future of two elementary schools in Surrey. You're in a hot-air balloon above one of these schools. You look down, and what do you see? You see a large structure. That must be the main school. Surrounding the school is a group of smaller structures. It's recess on a sunny day, so you expect to see a busy playground and children out playing in the fields and enjoying a bit of physical activity before going back to their desks.

Instead, you see a village of portables consuming all of the fields and play spaces, so the children are running between the narrow pathways between the portables. Yes, this is a very real look at what public education will be like for 2,000 of Surrey's five-to-12-year-old children in just three years' time.

This just illustrates one challenge and one of the reasons why the ad hoc committee was formed. We are a non-partisan Surrey district advocacy group comprised of representatives from Surrey city council, Surrey Board of Trade, Cloverdale Chamber of Commerce, Surrey Association of Sustainable Communities, Surrey Teachers Association, CUPE 728, Surrey district parent advisory councils, Lord Tweedsmuir Secondary and Earl Marriott Secondary advisory councils and concerned students.

Our goals are, first, to secure immediate capital funding and, second, to ensure that the provincial government develops a long-term capital funding plan for education that meets the needs of Surrey's growing community.

With a current population of over 474,000, an enrolment this year of 70,000, we live in the fastest-growing and largest school district in British Columbia. Already the largest city in area, we are expected to reach a population of 850,000 by the year 2050. Citywide our current growth rate is 10,000 new residents per year. This produces an increase in enrolment of 1,000 students each year. One-third of our population is under age 19.

Our community is vibrant and culturally diverse, offering wonderful parks, community centres, sporting facilities, events and activities. New businesses are investing here. Our arts community is thriving. We are proud to call Surrey our home. And yet, we don't have the necessary facilities in which to educate our children. Our education infrastructure is falling rapidly behind.

Over 7,000 children in Surrey attend classes in portables. In addition to this, we have two secondary schools that have gone to extended schedules because adding portables is no longer an option. In contrast to Surrey, Vancouver school district has a full 30 percent more education space and over 11,000 fewer students.

[1435]

Since portables are not considered permanent assets, the costs to purchase, move and maintain them come out of operating funds. According to our school board, this amounts to between $4 million and $5 million each year, funds that are meant to pay for services and equipment in the classroom — services like education assistance for special needs children, counsellors, special education teachers and the technology needed to deliver 21st-century learning.

When you add portables or implement extended schedules in a building intended for fewer students, you put incredible stresses on those facilities. Gymnasiums, washrooms, libraries — and in our high schools, cafeterias, science labs, computer labs, woodworking and other specialty shops — are overtaxed, and therefore, students have less access and opportunity to use them. So 45 percent of Surrey schools are overcrowded, and many of those schools are more than 25 percent over capacity or severely overcrowded.

Studies have shown a correlation between overcrowding and lower achievement in math and reading. Bottom line: children who attend public school in Surrey get less than those who attend public school in any other school district in British Columbia. This is not right; this is not equitable. The families and students of Surrey should be given the same opportunities and consideration for public education.

The fact that there has been no capital funding in the past six years for necessary education facilities concerns us as parents, taxpayers and residents of Surrey. According to our school board, it will take up to five years and $273 million to build the schools we should have today. Before construction of these schools is complete, our school population will grow by an additional 4,000 to 5,000 students. That will leave us with the potential of having 12,000 children in portables before permanent facilities are ready. We need funding now, and we need funding to continue to meet our growth.

We've met with our MLAs. We've met with Minister Abbott, with Minister Falcon. Mayor Watts has met with Premier Clark. Everyone has listened, and everyone has agreed: Surrey needs more schools. Minister Falcon has promised a substantial injection of cash to build new
[ Page 1564 ]
schools in Surrey, and after the HST vote he stated that he would not be tightening spending on job-creating capital expenditures. Building schools in Surrey is, without doubt, a job-creating capital expense, yet we're still waiting for an announcement.

While Surrey would like to support the Education Ministry's ambitious service plan, we are hard-pressed just to ensure that the current curriculum is delivered successfully and fairly to our students in overcrowded schools. The fact that Surrey is not even mentioned under future major capital expenditures in the ministry's plan is of real concern. Our administrators, support staff, teachers and students are struggling under extremely stressful circumstances and using their considerable energies and talents just to cope with overcrowding and scheduling concerns — never mind delivering or receiving the quality public education we expect in British Columbia.

And that trip we took into the future? Three years from now it will become reality. Two of our elementary schools will have over 20 portables. Yes, even if we get the funding we're asking for today, if the funding process is not changed, those children will be playing in narrow corridors between portables, instead of enjoying the playgrounds and open fields many school districts take for granted. The existing funding process does not work for growing districts like Surrey.

A case in point: our most recent new school, Adams Road Elementary, was approved for funding in 2005. It didn't open until six years later. It was originally approved for a total enrolment of 420 students, yet the Ministry of Education reduced the plan to 320 students. Now, just six months after opening, it has four portables and over 400 students.

Another elementary school in Surrey was built for 480 students and currently has an enrolment of 800 students. That's a higher enrolment in one Surrey elementary school than in the total enrolment of the entire Stikine, Nisga'a and Central Coast school districts combined. Meanwhile, the land required for six new elementary schools has been totally paid for and is sitting empty, waiting for capital funding needed to build those schools.

[1440]

Additionally, Surrey school district has submitted repeated requests for capital funding of both site acquisition and building of six more schools and two additions to existing schools. They've received no response to date. Clearly, the current funding process is not meeting the needs of our growing community.

In conclusion, we ask you to first urge the Treasury Board to provide adequate capital funding now to enable Surrey school district to alleviate the overcrowding and provide equitable facilities to deliver public education today.

Second, ask the Ministry of Education to review and revise its current service plan. We ask that Surrey's growth needs be reflected in this document under major capital projects that are planned and that Surrey's needs continue to be addressed in future service plans.

Lastly, set up a subcommittee to review the current capital funding process for education. We contend that the existing process does not allow for adequate, timely or ongoing funding to enable our school district to continue to meet the needs of our growing community.

We ask for a funding solution that plans for and addresses our growth. Thank you all for your time and attention. I'd like you to know that we have several members of the committee here today as well as several high school students. We would be happy to address your questions.

R. Howard (Chair): We have some questions. First up, MLA Ralston.

B. Ralston: Thanks for putting together what is a very broad-based, non-partisan committee. I know I've met, and all the MLAs in Surrey have met, with your committee, and I think we're very impressed with the group of people that you've put together.

The recent opening of the Surrey Public Library, I think, reminded us what can be done in a very quick amount of time if a capital budget is approved. It was built from start to finish in about 15 months.

The Minister of Finance made some suggestions in June that he was going to make an announcement in a few months. A few months have passed. Sometimes groups like yours are consulted in advance of an announcement or told of an announcement that's coming. What have you heard lately?

L. Stromberg: We've heard nothing more on that, other than that it's still being considered. We've heard that the Treasury Board, after the mayor's meeting last week, or the week before…. The mayor met with Premier Clark, and she indicated that it was going to be brought before the Treasury Board yet again, and I'm not sure when that meeting is occurring.

J. Thornthwaite: Thank you very much for your presentation and your obviously wide-reaching conglomerate of interested folks. You've done a great job of presenting.

My question is: if we were to put in a recommendation, do you have…? Is your plan, your requirement for new schools to alleviate the pressure on the portables the same criteria and same priority of schools that the ministry has, or are they different? I'm just wondering if the school board has a different one than your group and that the ministry has as far as targeting where you need that capital funding most, first.
[ Page 1565 ]

L. Stromberg: No, we've gone with the Surrey school board's list of priorities, and that is the list that was presented to government, so it's all the same.

J. Thornthwaite: Okay.

D. Hayer: Thank you very much, Linda and the students, for coming over and presenting this. I think this is very important. I was in the meeting with Mayor Watts and so were MLAs Kevin Falcon, Hogg and Stephanie Cadieux, and we also had quite a few meetings with the Minister of Education and school board and Surrey Board of Trade and many other organizations. At least, on this point we're all on the same page — all the MLAs, regardless of what the political point of view might be. But on this point we all agree 100 percent.

Then we were told that we should be hearing some sort of news on it soon — right? Just like you, I wish it was yesterday or a few months ago or years ago — right? But I think we need to get on, and it is really needed.

I know that in my riding of Surrey-Tynehead, the Fraser Heights area also needs expansion.

L. Stromberg: Yes, they've got 16 portables.

D. Hayer: We visited there, and we had some of the members. Also, the Deputy Minister has visited there.

Now, on this, have you also talked to Simon Fraser University or Kwantlen University to see if you could get their support? Because when they talk to me privately, they also support this. Have you had a chance to talk to those post-secondary institutions?

L. Stromberg: I haven't. I believe that the Board of Trade — and they're on our committee — work closely with Simon Fraser, and so I'm happy to hear if they're supportive of this issue.

D. Hayer: Thank you for your presentation and coming out.

R. Howard (Chair): Thanks to all three of you. We really appreciate your taking the time to come out this afternoon.

[1445]

Next up, we have Ethan Huberman. This is in place of British Columbia Paraplegic Association — withdrawn. Ethan has been kind of bobbing around on our list here, very patiently waiting.

Welcome, Ethan. As you undoubtedly know now, you have 15 minutes. I'll give you a heads-up around ten.

E. Huberman: Okay, thank you. I'm here today because of a response to an e-mail that I received that I sent to the government of British Columbia. And the response that I received back was from a CTB tax question, which stated:

"Thank you for your comments. Your e-mail has been forwarded to this branch for response. The B.C. government will be meeting with the federal government to discuss the terms related to the repayment of the $1.6 billion the province received in transition assistance when moving to the HST. This repayment, together with the lower revenues and higher administrative costs of the PST, means there are significant implications for the provincial fiscal plan."

The reason I'm here today is because I am a British Columbian who was born here, raised here and who has lived over three-quarters of my life here. You might say I have a vested interest in seeing British Columbia do well just for that reason alone.

Now, I would like to see British Columbia keep all of the $1.6 billion. It's not enough to just say I'd like to see that. I think I may have come up with a way of doing that, and I'd like to share that with the committee here today and take your questions on it, if you have any.

My suggestion is that when the PST is brought back, it be brought back at zero percent. If it is brought back at zero percent, that would allow the province of British Columbia to not have to go through a significant expense of causing the setup of a large amount of work to administer the PST system that was in place before it was turned into the HST system in this province.

That's one benefit. Another benefit is that I think that we would be able to keep the $1.6 billion. And although I haven't had any conversations with anybody at the federal level regarding the issue, I think it would be very difficult for the government of Canada, which clearly ran ads in this province prior to the HST vote being completed, stating that it was prepared to guarantee the rate drop from 12 to 10 percent…. And if it is, or was, prepared to guarantee the rate drop from 12 to 10 percent, I can see no reason why it would object to the rate going from 12 to 5 percent.

Then the next question becomes: where do you get the extra money from?

I'm not here to bankrupt the province — okay? I'm a fairly fiscally conservative individual, so where do you get the money? My recommendation is that income tax rates, whether they be for personal income tax or corporate income tax or, yes, even small business income tax….

Keep in mind that you happen to be talking to a small business person here. I'm not here to suggest that small business people — and I don't think most business people in the province — would think that they're interested in shirking their own fair responsibility and paying their own fair share of taxes.
[ Page 1566 ]

What I do think is that to throw away $1.6 billion — and I think it's a zero-sum game, if you will…. I think it's worth keeping or trying to keep, at least, that money. And in the course of negotiations with the federal government, I think that before sitting down with the federal government, I would like to suggest that this alternative be considered.

[1450]

Furthermore, as a method of keeping a balanced approach to funding this, I'm not only suggesting as low an increase as you can possibly make with moving us towards a balanced budget at the same time; I would also suggest that there not only be an increase in tax on income but also on wealth. And I think the easiest and most efficient manner in which that can be done is to….

To my knowledge, there are 130 to 140 municipalities, cities, towns, what have you in this province that all collect property tax already, and they probably all have audited financial statements every year. If that's the case, I don't think you'd need a huge amount of resources hired by the province of British Columbia to collect 130 to 140 copies of financial statements and 130 to 140 cheques per year, payable to the province of British Columbia.

My vision is that just as someone pays for a restaurant meal and then you see a line, HST, and then a total, you would see your property tax bill. It would get to a total. There would be a tax on that — it wouldn't be earmarked to go to the province of British Columbia — and then you'd have your total tax bill.

I'm not suggesting that the number be an enormous number. I'm not trying to promote taxation or increases in taxes, all other things being equal. The problem is that all other things are not equal because there is $1.6 billion on the table that I think the province of B.C. could maintain by doing that. I am not advocating tax and spend; I'm advocating tax and balance the budget.

It has also come to my attention that there is an issue that has been raised. An esteemed MLA has mentioned it to me, and I've heard it mentioned, a problem, when attending a former B.C. Chamber of Commerce AGM. That is, with respect to businesses that are located in the area near the province of Alberta.

The problem is that there are business people in that area who have a problem where people shop in Alberta because of the PST, because they can save the PST by shopping in Alberta. Well, my proposal would also solve that problem that is there for business groups that represent members and business people in that area.

With that being said, I'm open to your questions. All I'm asking for is for it to be studied and looked at with the feds. Before you negotiate with them, I think it would be good for it to be looked at, because if it is a possibility, I think it would be useful for the province of British Columbia's negotiators, whoever's negotiating with the feds, to be able to mention that that's being looked at.

R. Howard (Chair): Ethan, just so I understand, you're suggesting that by basically eliminating the 7 percent VAT, value-added tax, that exists today, that would be made up by income tax, personal, corporate and property tax?

E. Huberman: Yes.

B. Bennett: Just following up on the Chair's question, have you discovered what that amount would be annually if we were just to do away with the 7 percent? I'm not sure if anybody on the committee has any idea, but I suspect it would be in the billions — would it not?

E. Huberman: Although I'm not aware of what the number would be, what I can tell you is that there is $1.6 billion to gained as a zero-sum game here within British Columbia. In other words, whether the province of British Columbia is taking money out of the economy in the form of a sales tax or it's taking it out in the form of other forms of taxation, if we're still $1.6 billion ahead, that's why I suggest we do it.

I don't have that answer. I would be more than happy to learn that number, as well as the number that would be the cost per annum of administering the PST. There probably must have been a cost, somewhere known, when the PST system was in place. I just don't know what that number is.

[1455]

D. Hayer: Yeah, maybe what you can do is provide a written submission to the Finance Committee, and then state in there, maybe from your perspective, what's the total revenue it would replace from the provincial sales tax — right? — then how the $30 million approximately that we were paying to collect the PST would be eliminated, and how much the property tax share should be — how much from the corporate business tax, how much from small business and how much from an individual. So that way at least you could have a summary picture, just as a suggestion, for the committee to see. That might be a good idea, to take a look at how much taxes have to go up to collect that $5 billion or $5½ billion.

E. Huberman: Where can I get that information from?

D. Hayer: The Finance Ministry can provide you with how much money they received from the 7 percent of PST before — right?

E. Huberman: Okay. Thank you. I can do that.
[ Page 1567 ]

R. Howard (Chair): Thank you, Ethan. We have no more questions, so thanks for stepping forward today.

Committee members, we are waiting for our next presenter, so we will recess until 3:05.

The committee recessed from 2:56 p.m. to 3:05 p.m.

[R. Howard in the chair.]

R. Howard (Chair): Now up is the Surrey Board of Trade — Anita Huberman and Eric Wilson.

You probably know, but I'll tell you anyway. You've got a total of 15 minutes. At about the ten-minute mark I'll give you a heads-up. You can stop and take questions or go right through — your choice. The microphone is yours.

A. Huberman: Good afternoon, members of the committee. I'm Anita Huberman, CEO of the Surrey Board of Trade, and I'm here with the chair of my finance and tax team, Eric Wilson. He is also a partner with BDO Canada.

Together we're going to speak to you this afternoon. Our organization is one of the largest boards of trade in the province, representing over 3,600 business contacts in and around Surrey. In terms of population, Surrey is Canada's 12th-largest city, the 35th-largest city in North America, and it is expected to surpass Vancouver in just a few decades, if not less.

The South Fraser region is now home to over 850,000 residents, over 19 percent of B.C.'s population. A major part of the forecasted increase of B.C.'s population is due to immigration. Among all Canadian cities, Surrey had the fastest-growing number of foreign-born persons over the last five years, increasing by 31 percent between 2001 and 2006.

E. Wilson: Our two greatest priorities are education and transportation, followed very closely by health care, taxation and public safety. However, we advocate on a very wide variety of issues which impact the business community in the city. We have brought along several copies of our advocacy report for your information.

Today I will comment on some of the advocacy priorities I've just mentioned, as well as a few other areas which are integral to the successful and sustainable growth of what is currently B.C.'s second-largest and fastest-growing city.

A. Huberman: But before we get into the detail of the issues, we want to thank the provincial government for your commitment to improving Highway 1 and, of course, the new Port Mann bridge. We look forward to the opening planned for December of next year.

E. Wilson: We're equally pleased with the progress of the South Fraser perimeter road and look forward to the relief from vehicle congestion and the improvement to the delivery of goods and services throughout this gateway region.

A. Huberman: Another important achievement from our perspective was realized in the completion and opening of the Jim Pattison Outpatient Care and Surgery Centre, as well as starting the construction of Surrey Memorial Hospital's emergency department expansion and critical care tower. We're grateful for these much-needed improvements in infrastructure, but there is so much more to do to equip Surrey to service the enormous and growing population of our city.

E. Wilson: With respect to education, education infrastructure and a number of programs in Surrey are insufficiently funded from kindergarten through post-secondary, offered by Kwantlen Polytechnicand Simon Fraser Universities. For quite a few years now we've come before this committee to explain the problems facing education in this city. Here we are again. Nothing has changed, but the problems are becoming worse — very worse.

Last fall we launched Education Today, Productivity Tomorrow, a consortium of the Surrey Board of Trade, the city of Surrey, school district 36, Simon Fraser University and Kwantlen Polytechnic. It included a background paper on resourcing shortfalls in Surrey.

Since then we've also become active with the Surrey ad hoc committee on education for all stakeholders, including parents. We've attached information to our presentation for your review.

A. Huberman: Here are some very quick facts for you. Within the next five years one in three B.C. students graduating from high school will be from the Surrey school district, B.C.'s largest. While other school districts across the province, including the Lower Mainland, are trying to deal with falling enrolments, the Surrey school district is growing and expanding — 70,000 in Surrey versus 56,000 in Vancouver. This fall the school district received an additional 800 students, and being a designated centre for the location of refugees in Surrey, there are many with language issues.

[1510]

This continues to place exceptionally heavy pressures on our facilities. Every school has portables — so-called temporary classrooms. Fraser Heights Secondary has 16 of them — 232 in the district. They do not qualify as capital, so the school district has to pay about $100,000 from their operating funds. When the brand-new Hazelgrove Elementary School right here in Surrey opened, it had four portables. A second school planned for Cloverdale was shelved. In circumstances such as these, when you have to house students somehow, we're asking the committee to consider: how much longer should this go on?
[ Page 1568 ]

E. Wilson: To our knowledge, the last school in Surrey was planned in 2006, and there's been nothing since then. Meanwhile we can't help noticing there's considerable school construction ongoing elsewhere in the Lower Mainland. We don't begrudge the districts their facilities. That's not the point. But we have a serious problem here, and the problem goes right up the education chain.

Surrey continues to have the lowest post-secondary rates of participation. Simon Fraser University, which will present to you shortly, and Kwantlen Polytechnic, which has submitted a written brief, are dramatically underfunded to serve this rapidly growing region. Yet there are thousands of students who want to pursue their academic and applied degrees in trades training in their home communities and can't.

So when you hear from these institutions, remember the Surrey Board of Trade is dedicated to helping SFU and Kwantlen resolve their resourcing issues. Restricting the number of students attending these schools makes it considerably more difficult for the area's businesses to find a local cadre of educated and skilled young people, who will be the next level of business owners, managers, entrepreneurs, technicians, researchers, skilled workers and trades. We already know there will be a serious shortage of these people soon. From a business point of view, this situation is a matter that we can no longer afford to ignore.

A. Huberman: One last item in education, and that is the funding of the hub schools. These are the schools that have inner city–type issues. Exact comparative figures are not immediately available. However, we spoke to Laurae McNally this morning, who is the chair of the Surrey school board, and we all agree that nothing has changed. The funding disparity continues, where Victoria receives $192 per student; Vancouver, $158 per student; and Surrey only receiving $50 per student.

For several years now we have brought this to the attention of this committee. Every year we have had no result. No one is able to defend it. Everyone says that it will be looked into, but nothing happens.

E. Wilson: Transportation. As we noted at the beginning we've got a lot to be thankful for, but because of the growth of the entire Lower Mainland, many of those cities south of the Fraser have been virtually shut out of transit.

Following on the mayors' vote last week, we'll simply ask that you promptly amend the necessary legislation restricting TransLink from seeking a wider array of options for sustainable funding, such as road pricing, so they can service the whole region.

We're currently facing an impact of tolls on the Golden Ears, Port Mann and, ultimately, Pattullo when it's replaced. Yet we all pay many transit levies which so far have provided a pretty good transit system for those living north of the Fraser.

A. Huberman: Next, on the topic of the HST. From a business perspective, the Surrey Board of Trade is disappointed with the vote on the HST and the return to the PST-GST regime. Therefore, we suggest the following to streamline the administrative burden that is related to PST filings for businesses.

One, the issue of the transitional tax rules be communicated as quickly as possible in 2012 so that business can prepare for the 2013 tax year; partner with business groups, like the Surrey Board of Trade and chambers boards of trade around British Columbia, to communicate these rules and hold workshops.

Two, match the GST threshold to the PST threshold. The GST threshold is at $30,000, and the PST is at $10,000. Streamline it by matching the amounts. In addition, match the filing dates for both taxes.

Further to this, our finance and tax team are going to review other small business taxes. These are just some of the following that we ask you to consider: (1) a review of the small business income tax, (2) further reductions to corporate tax and (3) property transfer tax.

Business needs stability and for international investment to occur. In a GST-PST environment, from a business perspective, the board of trade really feels that a review of all of the taxes via a small business tax review committee is a good thing.

[1515]

E. Wilson: International trade portfolio. We've been working in partnership with the Canada-India Business Council to lobby the B.C. government to host the International Indian Film Academy Awards, also known as IIFA, in May of 2013. Several meetings took place in the Premier's office and with several MLAs over the summer. The direct economic and job creation potential information is in a detailed proposal to the Ministry of Jobs, Tourism and Innovation.

In fact, the Surrey Board of Trade, with the Canada-India Business Council, is hosting the IIFA delegation from Mumbai this week, showing the possible venue sites. We urge the provincial government to allocate moneys towards hosting IIFA. It'll be an event with enormous payback potential for job creation and international investment in B.C., specifically in the area of film production.

A. Huberman: From our social policy portfolio, we recently hosted a Leadership Surrey dialogue to focus on homeless issues. We're working toward an action plan on how business can be part of the solution to end homelessness in Surrey. From a provincial budget perspective, we urge a coordinated plan between federal, provincial
[ Page 1569 ]
and local governments to build a solution to the lack of affordable housing. Businesses, in turn, will continue to hire, train and retrain skilled employees who can live in the same community.

E. Wilson: We've pointed out some of the major concerns held by the Surrey Board of Trade. We do understand and appreciate the complexities of the economic issues facing all of us and that they're not easily solved. However, we're actively working to find solutions. We will, again, visit with government ministries in Victoria to get to know the senior staff, hear their concerns and share our views. We wish to continue working together so we can be part of the solution. Thank you very much for hearing us.

R. Howard (Chair): Thank you. We have questions.

D. Donaldson (Deputy Chair): Thanks very much for the presentation. I commend you for your vision on the education file especially — something we're very concerned about in the province. You mentioned Kwantlen. The Kwantlen Faculty Association presented earlier, describing difficulties getting into courses, career counselling problems, a growing wait-list, affordability issues. And you pointed out people not being able to get their trades trading in their community, in reference to Kwantlen.

So is it the board of trade's view to support the Kwantlen Faculty Association's recommendation to review the funding formula so that it better reflects cost pressures?

E. Wilson: Absolutely.

D. Hayer: Thank you very much for your presentation. Just before you, people were talking about more funding for schools. My question to you is…. In the budget we talked about balancing the budget and also asking how government can either cut some of the expenses to balance the budget or maybe generate new revenues. Is there anything in the budget that will show how we can generate some more revenue to balance the budget for 2013-14?

A. Huberman: At this time we haven't looked at that in detail. We can certainly look at that at our finance and tax team level. But I think, from a board of trade perspective, education and transportation are key economic foundations. I think all we're asking is a visible review and action thereafter to take a look at what's happening in the South Fraser region, specifically in Surrey, when it comes to this key economic crisis. That's what we feel.

D. Hayer: So your top two priorities are education and transportation?

E. Wilson: That's correct.

R. Howard (Chair): Excellent. We thank you both for taking the time to come out and present to us this afternoon.

Next up we have Roland Orfaly.

Roland, as you probably know, you have 15 minutes. At about the ten-minute mark I'll give you a heads-up. You can either stop for questions or go straight through — your choice. The mike is yours.

R. Orfaly: Thank you for making time to hear from me today. In reviewing the terms of reference of this committee, I have to say that I was initially a bit overwhelmed at what must be the huge magnitude of what you're trying to achieve. I'm not sure how you're going to do it. It seemed to me that over the number of hearings you've already had and the few that are left, you probably feel that people are trying to get you to get that square peg into the round hole. Everyone is trying to tell you to make the square peg bigger and the hole smaller, but you can do it.

[1520]

What I'd like to do right now is maybe focus a little less on the size of the peg and the size of the hole and more on the shapes and if they really fit together. To put it in more useful terms, it's not, "Should you spend more or save less or collect more tax?" but: "Are you getting value for the taxpayer money in the services that are delivered?"

I work in the health care system at Royal Columbian Hospital. I'm a doctor there. To be specific, I'm an anaesthesiologist working at the hospital. I see virtually all parts of the acute care system in our province — surgery, obstetrics, emergency rooms, resuscitation, intensive care, pain management on the wards and interventional radiology. It's part of my job every day, and I see how the system works. To be more accurate, I see the way the system does not work and does not work together to drive value and drive proper care for the patients who rely on health care.

As you know, the Health Ministry has the largest budget in government. It accounts for about 42 percent of government expenditures. The health care budget in B.C. has doubled in the last ten years, now reaching over $17 billion a year. I'm not here to ask you to increase that. I'm here to ask you to ask the question: are we getting value?

When medicare was started in the 1960s, there were basically two parts to the health care system. There was your doctor, working in an office in the community, and when you got sick enough, there was the hospital. That's the way health care administration was set up. You have medical services, and you have hospital services.

Well, here we are 50 years later, and I can tell you that the way the health care administration works
[ Page 1570 ]
hasn't changed one bit. You look at the two largest divisions in the largest ministry in government. You have over $7 billion going to the health authorities division in the Health Ministry, and you have almost $4 billion going to the medical services division for doctors in the medical services division. Those divisions are exactly that — divisions. They don't work in unison. They work in different offices on different floors. They have different accountabilities and different ways and means.

This leads to incredible inefficiencies. Over time other divisions have been added on. You have information technology, information management, data, negotiations, human resources added on in the fringes. But the two main divisions of the Health Ministry are not integrated enough for the way health care is actually delivered in the year 2011. Do you really think that hospitals work without doctors? Or the other side of the coin: do you really think doctors can work without hospitals? Why do we separate those in the way that we administer the health care system?

Let me give you a practical example of how this plays out. We have an anaesthesia care team. We don't always use that term, but we use non-physicians. We have nurses, nurse practitioners and anaesthesia assistants who are specially trained non-physicians who help us out in the care that we deliver to patients. In many ways, when used appropriately, they provide excellent patient care, and they save the health care system money. They are cheaper than a physician.

Two years ago, when the entire government was trying to achieve cost containment, one of the first things the health authorities did was that they went out and looked for positions they could eliminate. They eliminated funding for anaesthesia assistants, and they fired nurses and nurse practitioners that assisted us in patient care. It saved the health authorities money, but it cost the taxpayer more, because those patients still needed the care that was being provided. It just meant that now the buck stopped with the anaesthesiologist.

You then had to pay a doctor to do something that the nurses and the anaesthesia assistants were doing very competently at the time. Because the health authorities and the medical services don't function under one entity, what looked like a decrease in cost was actually an increase in cost to the taxpayer and a reduction in value.

When we go out and ask our members, the anaesthesiologists of this province, "If you had the ability to make small changes locally to your operating room, to your hospital, how much do you think you can improve the system? How much better value can you deliver to the taxpayer?" the answer we get is: "Between 15 and 20 percent, easily."

[1525]

No one really knows what it costs to provide surgical care in B.C., but it's probably between $2 billion and $3 billion a year. So think about it. Our members are saying that if you give them the ability, they can save you between $300 million and $600 million a year — simple, local changes.

That's not far-fetched. I mean, just think about this committee. Think about the Legislature. Think about everything that you do — your constituency office. Is it far-fetched to think that you can improve efficiency by even 5 or 10 percent?

A 5 percent improvement in perioperative care in B.C. would achieve over $100 million in savings. That's not chump change.

Two years ago we sat down with the top ministry officials in Health in B.C. This is the document that was circulated to you. I literally spent hundreds of hours with them talking mostly about efficiency, about problems in the system, but more importantly about the solutions we had for them.

We came up with 17 joint recommendations that the government supported. There was supposed to be a final report published by government on this. They decided not to publish that. We can talk some other time about why. In fact, I handed out my card. If any of you want to contact me afterwards, I'd be happy to talk to you.

Of these 17 recommendations, at least nine of them speak, amongst other issues, to how to make the system work more efficiently, how to save money, how to get better value. Two years later can anyone guess how many of those recommendations have been implemented? Zero — zero of nine easy solutions for efficiency in the health care system.

Let me give you another example — No. 2 of the recommendations. Six years ago we got together as a provincial association and said: "The way of the future is electronic health records." We see that the hospitals are already doing it. We want an electronic record for anaesthesia. When you come into the OR, instead of us copying down information from the computer sitting in front of us that's attached to the anaesthetic machine, have the anaesthetic machine actually record it electronically. That doesn't seem so difficult.

We had a unanimous vote of every one of our members provincially that we would go ahead with this project if funded by government. One year later, under the physician master agreement, $108 million was found for the Physician Information Technology Office. The first priority of that was supposed to be…. The government and the BCMA agreed that the purpose of PITO was "to promote the use by all physicians in British Columbia of an EMR" — electronic medical record — "as their principal method of recordkeeping" for patients and clinical records. That's straight out of the physician master agreement.
[ Page 1571 ]

We thought: "Great. We have 100 percent support of our members. We're ready to go. The technology is there, and the funding's there, and the first priority is supposed to be doing projects like what we're proposing." It's now been five years. So where's the project? It's not funded. In fact, we're the only physician group in B.C. that hasn't received any funding from PITO.

We're also the only physician group that actually put our own compensation on the table. We're paid in time units. Every 15 minutes we get so much. If you bring in an electronic health system that actually records all this stuff for us, it saves us time. We'd actually earn less if you brought this system in, and yet we support it unanimously.

The other aspect is that we'd also be an area where the electronic record, the system, would not be owned by us. You've paid for all the GPs to get their systems brought into their offices. They own those computer systems even though the taxpayer paid for them. Because we work in hospitals, the health authorities and therefore the taxpayer would retain ownership of that system, and yet it wasn't funded. It just doesn't make sense.

So let's take a very conservative estimate. If you can save me five minutes of time in charting all those vital signs every case — five minutes — multiplied by every surgery that happens in this province, you've now freed up enough OR time to do 27,000 more surgeries in the year without hiring a single more nurse or turning the lights on in an additional OR. Why is this not happening?

[1530]

Anaesthesia assistance, information technology, electronic records, dedicated positions. There are all kinds of ideas that we've come forward to the ministry, to government, wanting to start, and yet no movement, no solutions implemented. It just doesn't make sense. That's why I think the first message, the first question that needs to be asked is: what about value? Let's forget about expenditures for a minute. Let's forget about tax revenues, and let's talk about value.

R. Howard (Chair): Thank you, Roland. We have a number of questions.

M. Stilwell: Hi, Roland. Thanks. I have a two-pronged question, with the Chair's leave, about supply of anaesthesiologists. I am mindful of the value of recommendation 8 and others related to allied health professionals providing services. However, two questions about supply of MD specialists in anaesthesia.

No. 1. What are your concerns or views on the impact of the practice of recruiting anaesthesiologists to British Columbia who cannot or have not passed their fellowship examinations?

And secondly, you may be aware that there are hundreds of people who grew up in British Columbia who are studying medicine abroad who very much want to come home and would like residencies, including in anaesthesia. What do you think are the possibilities for repatriating at least some of those physicians into anaesthesia positions?

R. Orfaly: As you identified, there's a critical shortage of anaesthesiologists in this province. One of the responses that seems to have occurred from the government down to the health authorities has been, "Recruit anyone," which I don't think is the proper answer for patients.

There is a standard for specialty physicians in this country, and it's set by the Royal College of Physicians in Ottawa, and that is a fellowship of the Royal College. I don't think we should be completely disregarding that standard simply to fill shortages.

On the other issue as far as foreign-trained medical graduates, I think there is certainly an area that could help us with this supply. The issue here in B.C., as you identified, is they still need specialty training. There have been external reviews of the anaesthesia training program at UBC, and it is so under-resourced that we're basically at capacity in terms of the number of students that we can train. I would love to be able to say that we can double the anaesthesia training program. We simply don't have the capacity to do that.

M. Stilwell: Can I just add…? One more question. Isn't that because some of the hospitals are staffed by non-fellowshipped anaesthesiologists, who cannot train residents, therefore?

R. Orfaly: Yes and no. I mean, the real bottleneck is going to be in the subspecialties, such as pediatrics and obstetrics and cardiac, which aren't done in the outlying hospitals. There are a lot of bottlenecks. But certainly, the issue you brought up is an opportunity.

R. Howard (Chair): I'll have to move on.

D. Donaldson (Deputy Chair): Thanks for the presentation. I had a question about saving, conservatively, the five minutes of charting time and the amount of OR time that could potentially free up. Are you saying the bottleneck is with the anaesthesiologists or…? Surely there would be some time management of tasks there where while an anaesthesiologist was doing his charting, other things could be occurring. Or is the bottleneck all hinging on you guys in the operating room doing your charting?

Secondly, unrelated to that question, the zero of nine that haven't been implemented. This is your time in front of the committee. Why don't you tell us why you don't think it's been implemented.
[ Page 1572 ]

R. Orfaly: I'll deal with those questions in the order that you gave them. So as far as: how does the OR actually work? You have surgeons, and they'll say that the biggest frustration to them is the turnover time. From the time that they finish one surgery till the next surgery starts, getting one patient out of the OR and the next patient in is what slows them down. Now, I think there are other issues. But for example, if we're not spending five minutes charting on a patient who's in the room, we can be preparing the equipment, the medications for the next patient — sitting there still monitoring patient No. 1. So it will save time.

On the issue of…. Sorry.

D. Donaldson (Deputy Chair): The nine recommendations that would be efficient to save money or create efficiency. You alluded that they hadn't been implemented. Why do you think that?

R. Orfaly: I think there's a lot of politics. I think there's a lot of vested interests in the system, and I'm not just talking about the end users. I'm talking about the administrators. I'm talking about government. I think there is a lot of fear about changing from the status quo.

[1535]

That being said, this also comes down to the fact that we work in the acute care system in the health authorities, and you have two budgets that are opposed to one another. Saving money in one might cost in the other. What we're talking about is the overall good for the taxpayer and the overall good for the patient, but there's no one who actually has the accountability for that higher view of things.

R. Howard (Chair): You'll have to be very quick, MLA Thornthwaite.

J. Thornthwaite: You've spent a lot of time doing what we asked you to do, which is: where could we save and be more efficient? My question is a follow-up from MLA Donaldson's, as far as why you think these recommendations haven't been taken — one being that it is politics and that nobody wants to be cut in their particular areas. "Always cut somewhere else."

Given your recommendations, there must be other avenues within the health care system that an equal amount of people could come up with an equal amount of suggestions. If there were one, two or three that you could recommend that we could do right away and that would save the health care system, efficiencies, what would those be?

R. Orfaly: To be honest, I think they can all be done right away. All it takes, and what we're really missing, is a process. We don't even have a process to get this type of change happening.

R. Howard (Chair): Thank you, Roland. We've got MLA Hayer left on the question list, but we're well over our time, so we'll say thank you for taking the time to come and present to us this afternoon.

R. Orfaly: You have my contact information, so I welcome any further contact.

R. Howard (Chair): We do. Excellent.

Next up we have Simon Fraser University. We have Wilf Hurd, Joanne Curry and Andrew Petter. And that's just in time.

A. Petter: The Port Mann slowed me down, and I apologize to the committee.

R. Howard (Chair): That's all right. Welcome, Andrew. As you probably know, you've got 15 minutes in front of the committee. At about the ten-minute mark I'll give you a heads-up. You can stop and take some questions, or you can keep going. Your option.

A. Petter: Well, thank you very much to the committee for making time available. We greatly appreciate the opportunity. I believe there are some handouts that committee members should have, both on the Surrey MOU of implementation and, within it, some graphs that I'll refer to.

First of all, we very much, as I say, appreciate the opportunity to share with the committee some perspectives on post-secondary education, particularly in the South Fraser region, and to share with you why we think the South Fraser region is one that deserves this committee's and the government's particular attention as part of a larger commitment to higher education.

We note that British Columbia has demonstrated, in policy and in action, its commitment to higher education as a key component of its strategy to ensure B.C.'s economic competitiveness as well as to meet labour market needs. This commitment, however, is most urgent, in our view, in the South Fraser region, which is one of the fastest-growing areas in Canada and, from a post-secondary perspective, one of the most underserved in the province.

In 2006 the province and SFU signed a memorandum of understanding to double the size of SFU's Surrey campus, from 2,500 to 5,000 student FTEs by 2015, and that's what's referred to in the brochure you have here. We believe that a recommitment to that expansion today would address a major regional inequity while providing a timely investment in the skilled workforce and research capacity vital to this region's, as well as to the province's, overall economic future.

The South Fraser region — if I can focus on that for a second — comprising the cities of Surrey, Delta, Langley and Abbotsford, is home to just under one
[ Page 1573 ]
million people. The combined population of Surrey, Langley and Abbotsford over the last three years grew some 16,000 to 18,500 per year, and Surrey's population grew by a rate of 3.4 percent between 2009 and 2010. Surrey indeed has one of the fastest-growing populations in B.C. About 32 percent of Surrey's population is also under the age of 25, a remarkably young demographic, with a school-age population that's also one of the fastest-growing in B.C.

[1540]

This growth has overwhelmed the current post-secondary capacity at the South Fraser's three universities — Kwantlen Polytechnic University, the University of the Fraser Valley and, of course, SFU Surrey.

The South Fraser region has just 126 post-secondary seats per 1,000 18- to 29-year-olds. That compares with a provincial average of 244 seats. So 126 in the South Fraser versus 244 on a provincial average. It's clearly an imbalance for this region — a region that, as I've said, is experiencing huge population growth and, in Surrey's case, particularly population growth amongst younger people who are going to be looking for educational opportunities.

The transition rates of students in the South Fraser region from secondary to post-secondary education has traditionally been lower than other regions of greater Vancouver. According to census data from 2006, Surrey also has had just under half the percentage of Vancouver's residents with university degrees. So in Vancouver about 33 percent of residents have university degrees. In Surrey the number, in 2006, was 16 percent.

This is a fast-growing region with huge educational needs that does not have the same representation of education amongst its existing population. The three graphs that are included in the brochure, I think, really help to bring home the situation in a pictorial way.

The first graph details the projected enrolment of grade 12 students in Surrey school district compared with others in the Lower Mainland. As you can see from this top line, that growth is extraordinary and very much out of step in terms of the upward growth in enrolment in Surrey relative to what you see in most school districts.

The second graph shows the transition rate of students in South Fraser school districts from secondary to post-secondary education compared with students in other British Columbia school districts. Again, what it shows is that in school districts like Delta, Surrey, Langley and Abbotsford, those transition rates are lower — significantly lower — than in districts like Vancouver, Richmond and North Vancouver.

The third graph is one that shows you the impact of this at SFU Surrey, where our enrolments have been fixed at 2,500 funded FTEs. What you see is, over the last number of years, a significant rise in the number of applications. So we now receive four applications for every seat, and entering GPA average cutoffs are rising.

Just to give you an example of what that means, in our mechatronics engineering program, a program which really responds to the province's desire to have more students coming into engineering…. That program has, in the last two years, had an entering GPA that has risen by 10 percentage points. So now you need an 85 percent GPA to get into that program. Previously it was 75 percent.

So you can see — in the numbers of applications, in the rising GPAs, in the general demographics — just how much pressure there is within Surrey and, more generally, the South Fraser district for post-secondary education.

Moreover, we assume that the committee is probably familiar with the Skills for Growth report, British Columbia's labour market strategy that came out in 2010. Just to draw this regional picture within a larger picture, what that report shows is that all of British Columbia is going to experience a significant labour market skill shortage unless there is a significant increase in post-secondary participation rates. Due both to new employment opportunities and retirement of current workers, an estimated 1.1 million jobs will open in this decade, almost 80 percent of which will require some post-secondary training.

Given that only 67 percent of the current workforce has such training, what the report concludes is that we're going to need to increase our participation rates to 90 percent of new labour market entrants needing some form of post-secondary education. And you'd think particularly, of course, those entrants will be the ones who come out of our existing school system.

Just to stay competitive and meet labour market demand, both created by people exiting the labour market but also new jobs being created with more skills required, we're going to need generally to increase participation rates very significantly in this province to meet that demand, according to the government's own labour market strategy report from last year.

The current provincial post-secondary transition rate is well below that standard, and of course, the South Fraser region stands out as especially in need of immediate attention.

[1545]

I might just parenthetically note that both the recent jobs plan announced by the government and Skills for Growth point to the need to bring in more students from outside of British Columbia to meet that labour market demand — more international students.

Simon Fraser University is already a leader in this regard. We have over 17 percent international students, and that makes us very much a leader amongst universities in terms of our international student population. So
[ Page 1574 ]
that representation is already there, and we are already doing our bit to try to bring international students to British Columbia.

Turning to SFU Surrey, the Surrey campus is Simon Fraser University's top expansion priority. As part of this planned expansion, the university has identified two areas of particular priority for program growth: health and clean energy engineering. Both areas address key labour market needs and would generate research that could be transformative socially, economically and environmentally.

Health care is consistently ranked as a top of mind concern for British Columbians. With increasing pressures to deliver financially sustainable health care, we believe that innovative health education programs are sorely needed to train the people at the undergraduate and graduate levels who can contribute to cost-effective improvements in our health care system.

We think SFU Surrey, with its partnership with Fraser Health, which is now co-located with us in our Surrey campus, can contribute a lot to developing such programs, to addressing skills gaps and to undertaking important research in areas that can benefit from SFU's focus on public health, population health and disease prevention, areas in which we have considerable strength. I look forward to building on that strength in new program areas.

The other priority area — clean and renewable energy — is a cornerstone of the province's climate action plan and is already a provincial strength. B.C.'s clean tech industry has identified a well-educated and skilled workforce as B.C.'s greatest competitive advantage. SFU's proposed energy system engineering program would be the first of its kind in western Canada. It would build on our existing strength in mechatronics, and it would support the kinds of public-private partnerships that are proving their worth.

In this regard, SFU has recently signed a letter of intent with Powertech Labs, the city of Surrey and B.C. Hydro to partner in developing education and training programs, accelerating new companies and undertaking demonstration projects.

SFU is very much an engaged university. We very much are a university that sees ourself as part of the communities we serve. We believe in partnerships with private business. We believe in partnerships with local communities. We believe in partnerships with other post-secondary institutions. And I think we've demonstrated our commitment to making our education programs support economic and social objectives as well as the educational objectives that they intrinsically speak to.

In conclusion, the Skills for Growth report clearly outlines the challenges B.C. faces in labour market development generally and the need to increase post-secondary rates to make sure that B.C. remains competitive. The potential skills shortage and lack of advanced education seats in the South Fraser region speak to a particular need and priority for growth in post-secondary seats in this region.

The MOU that was signed by the Ministry of Advanced Education and Simon Fraser in 2006 provided for a doubling of SFU Surrey's physical space and enrolment by 2015 to meet what was then seen to be the regional demand for post-secondary seats. That demand has only grown since.

While it's no longer possible to meet that 2015 goal — we couldn't deliver that number of new seats within the time available between now and 2015 — we believe that moving forward immediately to fund the first phase of that expansion, including the health and clean energy engineering programs that I mentioned, would put SFU on a path to achieve this growth in seats by 2020 and that such expansion would benefit and benefit from academic transfer programs at Kwantlen Polytechnic University and the University of the Fraser Valley as well.

I should say that SFU is very committed to working with the government, the Ministry of Advanced Education, to ensure that we do remain competitive, that we draw on the need for highly trained and highly skilled workers in order to meet our economic needs and to link our programs to those needs, regionally and provincially.

B.C. needs a skilled, versatile workforce. B.C. business needs the innovative capacity to create new products and new jobs. The province needs the kinds of connections to the Asia-Pacific and other emerging economies that typically develop through ambitious recruitment of international students and the work of leading researchers. In areas such as health and clean energy, Surrey and the province need the social, economic and environmental benefits that SFU Surrey, in partnership with businesses, governments and other institutions, can provide.

[1550]

As I say, if you go back to 2006, even then the need to double seats at our current campus was seen as a priority. That priority, it seems to us, is that much greater today, and I hope this presentation has helped to demonstrate why we believe that's the case and why addressing that priority is not only good for education; it's good for the economy and good for the province of British Columbia.

R. Howard (Chair): Thank you, Andrew. We have some questions.

M. Stilwell: Thanks, Andrew. My question is smaller, around tactics, around international education. Obviously, recruiting international students is important to the province. I am wondering about the broader
[ Page 1575 ]
goal of internationalization of education, knowing that less than 4 percent of Canadians kids are, in fact, going elsewhere, which seems to me to be a very important part of the question.

It used to be possible to do exchanges, whereby the tuition you paid at your home school was honoured at schools abroad. I am wondering what, if anything, you are doing along those lines or something newer and better to encourage students from B.C. to go abroad to get the advantage of being an international student.

A. Petter: I very much appreciate the question because there are a number of barriers that discourage students: language, some reluctance to leave home and be in a foreign locale on your own. So we have a number of strategies. There's one that I think is working particularly well, so I'll highlight that one for us because it addresses some of those concerns.

We have created a dual-degree program with a partner university in China around computing science, which has started at the undergraduate level but has now been expanded because of its success. We now hope to replicate it in other institutions, both in China and potentially elsewhere.

It works this way. We take a computer science program that would normally be delivered in three years and extend it into a fourth year, and we partner with a leading institution in China, which does the same. The students starting in Canada enrol in Canada for the first year and get Mandarin language training as a cohort. They develop a sense of community amongst themselves and comfort as a group of students.

They develop sufficient language proficiency to allow them then to go to China for two years. They then join with the Chinese students, where they study for the next two years, and then that entire group, Chinese and Canadian students, comes back and studies the last two years — oh, it's a five-year program; sorry, not a four-year; five years rather than four years — at SFU.

At the end of the day, they get two degrees. They get a degree from SFU, and they get a degree from China. They also have internship opportunities in both countries, so they get exposure to the connection between the discipline that they're studying in the classroom and the workplace, and they gain wonderful language and cross-cultural education from each other.

Now, I think this program works particularly well because students who are reluctant to go because of language barriers or because of isolation see this program as a way of overcoming both those challenges. The university provides the language training as part of the program, embedded in the program. They develop a sense of community and a comfort level so that when they go to China, they go as a group, they know the program is designed to accommodate their needs as a group, and then they form bonds with the other students that develop the kind of cross-cultural training that not often enough occurs in international education.

That's one model. We also, I might say, leverage a lot off our co-op programs. We have programs where we're placing students in restoring villages in the Punjab through co-op, internships and other forms of exchange. But I think the dual-degree program is a particularly exciting model.

R. Howard (Chair): Thank you, Andrew. I've let you go way over time because I felt bad the way I rushed you when you first got in the door.

A. Petter: That was my mistake. Sorry.

R. Howard (Chair): But we are a little bit over time, so I'm going to have to wrap it up. We've got MLAs Ralston, Hayer and Donaldson who have had questions. They'll have to catch up with you outside this forum.

A. Petter: Okay. And there's a written version of what I tried to say, breathlessly — you can read it in a more deliberate way perhaps — that I'll leave with the committee. Thank you very much for your time.

R. Howard (Chair): Excellent. Thank you very much.

Next up we have Capilano Students Union. We have David Clarkson and Brandon Hofmarks.

[1555]

Just as you guys are getting set up, you may know that you've got 15 minutes. I'll give you a heads-up at around ten minutes. You can stop and take questions or go straight through — your choice. The microphone's all yours.

D. Clarkson: Thank you. I'm David Clarkson. I'm the chairperson of the Capilano Students Union.

B. Hofmarks: And I'm Brandon Hofmarks, also a chairperson for the Capilano Students Union.

D. Clarkson: The Capilano Students Union represents over 7,000 undergraduate students at Capilano University at its three campuses in Squamish, Sechelt and North Vancouver. The CSU offers students a variety of free and low-cost services and facilitates clubs, on-campus activities. In addition to providing services to students, the CSU is an advocate of issues, and we ensure that the needs of students are presented to the university administration and federal, provincial and municipal governments.

We're here today to talk about three issues and key recommendations that we have for the province at this time. In summary, the first recommendation is to eliminate interest on student loans and as part of a review of
[ Page 1576 ]
the student loan program. The second recommendation is to establish a front-end grants program for students. The third recommendation is to increase the operating funding for post-secondary institutions in B.C. I'll go through each of these individually here.

With respect to student loans, we feel that a reform of this program is generally needed, specifically with the focus to eliminate interest on these loans. It's the case now that more than half of students will take on debt as part of their post-secondary education and that, on average, this debt will approach about $30,000 over the course of a student's education.

That amount of debt upon graduation is a significant barrier to entering the labour market and a significant obstacle to general issues with one's life such as home ownership or starting a family, for instance. Through eliminating interest on these loans, it would ease the burden of owning these kinds of debt as well as reducing one of the barriers to education, which is the aversion to owning this kind of debt in the first place.

Through our colleagues at the University of Victoria Students Society and StudentAid B.C., we've actually costed this elimination of interest on loans to only be $30 million per year and feel that this is a very feasible way for the government at this time to improve the quality of education in B.C.

Our second recommendation is to establish a front-end grants program for students. I'll tell you a little story about Capilano University here. Since the 2001-2002 academic year, tuition has increased by 281 percent at Capilano University, largely as a product of deregulation in the 2003-through-2005 academic years.

Presently, per-credit tuition is $113.40, which is 58 percent higher than McGill University tuition for Quebec residents, where it's just $72.26 per credit. As a result of this high tuition, this is a contributing factor to the accumulation of debt, but it also causes students to supplement their studies with part-time or full-time employment, which also will prolong their time in the education system and reduce the amount of time they're able to participate in the workforce. And again, also this unaffordable tuition is very formidable for low-income British Columbians to access post-secondary education.

With respect to the issue of tuition and high tuition, it's not necessarily a problem itself. Those who can afford to pay these user fees will do so through a front-end grants program that's distributed on the basis of need. This is a mechanism where financial assistance can be provided to those who will need it, and it will offset that burden on a selective basis that will maximize the effect of that investment in the post-secondary sector. The cost of such a program would vary depending on the level of investment, but we would estimate that it would cost somewhere between $80 million and $100 million per year.

Our third recommendation is to increase the operating funding for universities. Brandon is a member of the university senate at Capilano. I'm also on the board of governors. So we sort of benefit from the insight that that provides us, not only from the students society but also from the governance of the institution. We really do see firsthand how the impacts of funding affect post-secondary education.

[1600]

Just for some figures for everybody, last year public funding accounted for only 48 percent of the revenue that Capilano University received. This is on a declining trend. Over the last two years the public grant has been held at the same level and is going to be continued to be held at the same amount this year and for the next two years. So with the effects of inflation, the real value of this grant is [inaudible recording] over time.

Many have suggested that this is actually, in fact, the gradual privatization of post-secondary education, and in many senses that's correct.

The average per-student funding, according to the fact sheet published by the Ministry of Advanced Education, is $10,000 per student. If Capilano University received that amount of funding, we as an institution would be receiving $16.7 million more per year. And if we were to only receive the amount equivalent to the average of peer institutions, we would receive $7 million more every year.

This is a situation that is kind of on the extreme. Capilano University is one of the lowest-funded per-FTE institutions in B.C. But I think that what it does is demonstrate the need generally for one-time funding increases across the province as well as a commitment to annual increases in these operating grants to the institutions to offset the effects of inflation.

With respect to the most recent budget at Capilano University, very difficult decisions had to be made around how to balance that budget. In the end, dozens of sections of community development courses were cut. Counselling sections were cut. The university can no longer afford to offer peer support.

Programs through its counselling department. It had to finish the phase-out of a speech-assisted reading and writing program for people with disabilities and, surprisingly, could not find funding for sections of courses that almost are revenue-neutral but only require a small investment of capital in areas that are critically in need of courses — so in the arts and sciences areas at Capilano University.

There's a real need for this funding immediately. Again, I don't have a total number for provincewide — what this might cost. It would depend on the level that the government would choose to fund. However, for Capilano University, it would be $7 million to bring us up to the peer average or $16.7 million for the provincial average.

In summary, those are our three-year recommendations at this time: to eliminate the interest on student
[ Page 1577 ]
loans, a front-end grants program for students and to increase the funding for post-secondary institutions.

R. Howard (Chair): Excellent. Thank you. We have a question.

M. Stilwell: One of the things that drives up students' costs is if they take more than four years to complete a four-year degree. Putatively, most recently that's because of students changing their major, which obviously happens for a lot of reasons after first year.

Does Capilano guarantee students who declare their average by the end of second year that they will be able to complete by the end of the fourth year, or do you know what proportion of…? I'm trying to get a feel for what percent of students are finishing a four-year degree in four years. And if there are large numbers who don't, what are the reasons?

D. Clarkson: I couldn't speak structurally how that's organized or with any kind of statistics. I do know a significant number of students in the fine arts programs, where a number of the four-year programs are located, do spread their program over five years. That's strictly anecdotal, though, at this point.

J. Thornthwaite: Thanks, David, for your presentation. I have heard this, but are you going to be giving us a written version of your presentation?

D. Clarkson: Yeah, I can do that.

J. Thornthwaite: One of the things that I would request that you pinpoint — I just want to make sure I heard this correctly — that Cap U is one of the lowest-funded universities in B.C.

D. Clarkson: Yeah.

J. Thornthwaite: I have heard that, actually, from board members on Cap U. If you could give us that information and the appropriate graph to support it, that would be very helpful.

D. Clarkson: Sure.

M. Elmore: Thanks for your presentation. I'm just wondering if you could talk about the increasing student debt and the pressure for students to take on a part-time job. Could you talk about that in terms of the numbers of students that's impacting? Also, we've heard, as well, from other presentations that it has the effect of…. We see the decreasing numbers of students who are actually able to finish their degrees drop off.

[1605]

D. Clarkson: Again, I'm not familiar with the exact statistics on this issue. Speaking from my own memory, it seems that almost everybody seems to have some form of part-time employment. It's actually kind of more a question of who is working two jobs at this point, in some cases. Or because of the economic downturn, who can't find employment to supplement their education, which is also very problematic for some students as a result and who then have to make very difficult financial decisions.

I can try and find that information out for you and include it in the report that we submit. Would that be helpful?

M. Elmore: Okay.

B. Bennett: I'd just like to draw you out a little bit on your comment about funding. I'm curious to understand it. Are you referring to utilization rates and the fact that your university has more students utilizing each FTE than other schools? Is that how you come to this conclusion that you're underfunded?

D. Clarkson: The number of $16.7 million?

B. Bennett: Well, the comment that you made about being underfunded compared to other post-secondary institutions.

D. Clarkson: Yes. So where both the numbers came from — the $7 million came from a query to the finance department at Capilano. I don't know the exact origin of that figure, although I believe it came from the VP finance, so I would expect that there was a good process of determining it. The $16.7 million takes into account the current operating grant, the number of FTEs that Capilano is expected to take in each year and the average FTE grant, according to the ministry fact sheet.

B. Bennett: I think you've answered my question. I think.

R. Howard (Chair): Thank you, gentlemen. We appreciate you both taking the time to come out this afternoon.

Next up we have Emily Carr Students Union — Samantha Lefort and Karen Whistler.

You've probably heard you'll have 15 minutes. At about ten minutes I'll give you a heads-up. You can either stop for questions or go straight through — your choice. The microphone is yours.

S. Lefort: Good afternoon, everybody. Thanks for the opportunity of letting us present today on what we believe should be the budget priorities for the province of
[ Page 1578 ]
British Columbia. My name is Samantha Lefort. I'm the chairperson of the Emily Carr Students Union, Local 33 chapter of the Canadian Federation of Students. We represent 1,800 undergraduates and graduates from the Emily Carr University of Art and Design.

K. Whistler: Hi, my name is Karen Whistler. I'm an international student in the graduate program at Emily Carr University. I'm also elected as the master's program representative and internal affairs representative on the Emily Carr Students Union.

Firstly, I would like to thank the committee for recommending the creation of a universal transit pass to students at one standard price amongst regions. We were quoted in the 2009 committee report recommending the creation of a truly universal transit program for post-secondary students. We are pleased to be sitting here today as partners in the U-Pass B.C. program and as one of the first schools to make the program come to life last January — so thanks.

We've worked closely with the Ministry of Transportation over the past couple of years to create Canada's first provincially coordinated U-Pass program. The response from students who we represent at Emily Carr has been overwhelmingly positive. The program allows students to make sustainable transportation choices now that can influence their decisions in the future.

The B.C. government is to be commended on this program, and we look forward to continuing to work together to ensure that the U-Pass meets students' needs.

S. Lefort: Our presentation today focuses on three opportunities for the B.C. government, in particular, that we'd like to see prioritized for the 2012 budget — the first one being university and college funding in relation to sustainability and climate action goals; the second one is the removal of provincial student loan interest rates; and the last one is grad funding for applied research.

[1610]

Emily Carr University is becoming a leader in the sustainability industry as well as with our practices on campus and in British Columbia. We're currently working with the city of Vancouver in a pilot program aptly named CityStudio, where students from around Metro Vancouver are implementing a project to attain the city's goals of becoming the greenest city for 2020.

Emily Carr represents three of the 14 students in that program, as well as multiple course partners. I am one of those students.

Recognizing the harmful impact of the bottled-water industry in particular, the university board of governors passed a motion in April to become a bottled-water-free campus, being the first in B.C. to do so. While this is an essential step and accomplishment, we're still looking for resources to be allocated towards becoming carbon-neutral, as mandated by the government.

As chairperson of the students union and student member of the university board of governors, I'm well aware of the impact that government funding has on the university budget. We have the intellectual resources to achieve these goals and become carbon-neutral, but since operational funding has not been increasing over the years, the financial resources are not available to commit to these vital climate goals.

An increase to operational funding would allow us to meet climate action targets. Our recommendation is that there is funding attached to the Premier's climate action goals for colleges and universities in B.C. to meet these targets.

Secondly, student loan interest rates. I'm sure you've heard about them, as Capilano just mentioned. We also see an opportunity to support B.C. students and families by removing the interest rates charged on the provincial portion of student loans. On average, students are graduating with a debt level of $27,000. This also means that students who cannot afford to pay up front and rely on loans will pay more for their education, when you factor in the interest they end up paying.

B.C. currently has the highest interest rates, of prime plus 2.5 percent, which is substantially higher than the government's cost of borrowing at prime minus 1 percent. Our recommendation is to eliminate the interest charged on provincial student loans, please.

K. Whistler: The last topic we want to discuss today is funding for students at the graduate level in B.C.'s special purpose teaching universities.

Students at special purpose teaching universities in B.C. are leading the way in innovative research and partnership with institutions, organizations and businesses beyond the university. We believe that this is a fantastic opportunity for the government of British Columbia to include support in the upcoming budget for graduate programs in B.C.'s special purpose teaching universities.

I am in my last year of the applied arts master's program in design at Emily Carr University. My research is using design thinking to influence healthy eating choices for families. The work of students in the program is incredibly varied and ranges from grey-water adoption in apartments to local hospital-centred patient advocate support systems.

The strength of the program is really in its ability to reimagine the role of the university in our communities. We are encouraged to work with community partners, from local hospitals to B.C. Hydro and its subsidiary, Powertech.

The contributions that students are making to the development of British Columbia are vast. Applied research is extremely valuable for economic stimulation and job creation, yet the grad program at Emily Carr
[ Page 1579 ]
currently receives no support from the government of British Columbia.

We see an incredible opportunity for the B.C. government to invest in B.C.'s creative and knowledge economy. Our recommendation today is that new funding be made available for graduate student seats at B.C.'s special purpose teaching universities for the development and support of applied research.

In conclusion, we believe that these three recommendations will strengthen B.C.'s post-secondary system and provide support for students — increased core funding to universities and colleges, the removal of interest rates on provincial student loans and new funding for graduate student programs at special purpose teaching universities.

Thank you very much. We welcome any questions.

R. Howard (Chair): Thank you. While they're thinking about questions…. We've heard that dollars are attached to two of your three proposals, or recommendations, but not the third — the grad funding. Do you have any idea of what the dollars that are attached to that are?

S. Lefort: We're going paperless. We're going to be e-mailing you our notes from today. We can include those numbers with respect to grad funding in that e-mail that we'll be sending to you.

R. Howard (Chair): Okay, thank you.

D. Donaldson (Deputy Chair): I'm an experiential learner, so I like paper. No, I'm just kidding.

S. Lefort: That's totally fair.

[1615]

D. Donaldson (Deputy Chair): My question to you is around the bottled water–free. I congratulate you on that initiative, and the board of governors at the school. I'm curious as to how that relates into a climate action plan and carbon credits. With your knowledge, do you know whether the school is getting recognized as carbon credits for banning water bottles on the campus?

S. Lefort: I hear a two-part question. To answer your second part very quickly and briefly: no. We don't receive any carbon credits just because we're bottled water–free. The idea behind becoming a bottled water–free campus is the language with which we use sustainability and how we talk about it on our campus, to encourage new initiatives to be started, to actually help us do the projects that will give us the credits to become carbon-neutral so that we wouldn't have to continue paying that tax.

So we'd like to create more awareness among staff, among facilities, among students, among the lobbying and how we talk about it in order to get the program started and lobby our administration to actually help us become carbon-neutral and create a carbon-neutral institution.

B. Ralston: I had a question just of clarification of your last proposal, because I hadn't heard that one before. Are you speaking of scholarships for those graduate students or bursaries for those graduate students, or are you speaking of greater funding for the program itself, more broadly speaking?

K. Whistler: I would say both. A lot of our students are international as well, so specific scholarships maybe wouldn't apply. But the funding for the program to help get the connections with government and other organizations and to get the resources we need to continue to develop good solutions that feed back into the community — definitely.

B. Ralston: Does any other institution offer this particular master's program, the applied arts? I hadn't heard of it before.

K. Whistler: Not in B.C., no.

M. Stilwell: Thank you for presenting. With respect to student debt, we are of the mind that a lot of that actually relates to high cost of living in the Lower Mainland, and I'm wondering if you have suggestions specifically of levers or tools that government might have or create that would help to create affordable housing for students.

S. Lefort: Well, I think that affordable housing for students has to not only be an initiative started by the provincial government, but as well as.… It's independent for each institution. It's my personal opinion that one umbrella solution for affordable student housing doesn't actually exist in Vancouver. We have so many different types of students — age ranges, where they come from, backgrounds, etc. — that one umbrella solution for affordable student housing might not be possible.

I think there is definitely an opportunity to alleviate some of the higher costs of living. When it comes to the high amount of student debt, if there was some kind of solution for an overall more affordable way to live in Vancouver, that would be, probably, a better long-term solution rather than targeting it at the short term just for students.

D. Hayer: My question is for Karen, a foreign student. We just announced that we're going to be doubling the number of foreign students. From your perspective, having foreign students at British Columbia universities
[ Page 1580 ]
— does it help the university, or does it hinder the university? Does it cause problems for other students and professors, or does it help them become better students and better professors?

K. Whistler: You're asking if the presence of a large international population within the school is helping or hindering?

D. Hayer: Yes.

K. Whistler: I think it's beneficial to both sides, and it has positives and negatives for both sides. As an international student, we're both bringing knowledge that we've gained from other places, and we're also learning about a new cultural experience. But I think overall it does help to get a more diverse community within the dialogue in the university. Yeah, I think it helps the professors as well, mostly.

D. Hayer: You're a foreign student. How long have you been studying in British Columbia or Canada?

K. Whistler: For one year, and I'm from the United States.

[1620]

R. Howard (Chair): That does it. Thank you both for taking the time to come out this afternoon. We appreciate it.

Next up we have B.C. Citizens for Green Energy — David Field.

Welcome, David. I'm sure you know, but I'll tell you anyway. You've got 15 minutes. I'll give you a little heads-up around the ten-minute mark, and you can stop for questions or go straight through — your choice.

D. Field: For anybody who was here, a repeat attendee, from last year, this one is a lot shorter. I'll warn you ahead of time.

Thank you for this opportunity to address the Select Standing Committee on Finance and Government Services. My name is David Field, and I'm speaking on behalf of B.C. Citizens for Green Energy. We are a citizens' advocacy group representing a cross-section of British Columbians who encourage a legacy of clean, sustainable electricity now and for future generations.

What I'd like to speak to you about today is the revenue side of the provincial budget and the revenue contribution that developing our province's renewable, green energy resources has in the present and for the future. I applaud the vision of the B.C. jobs plan, taking the strengths of British Columbia, converting them into competitive advantages and turning opportunity into lasting economic benefit for all British Columbians.

To me, that means developing the wealth of renewable energy resources we have here in B.C. and supporting what we've already started in this province with the clean energy investment we've attracted and the tax revenue it generates. Now is not the time to abandon the goal of electricity self-sufficiency and the jobs that renewable energy development creates and supports and the investment it brings. Developing B.C.'s renewable clean energy resources creates jobs all over the province.

There's certainly going to be heightened job activity in the northeast and the northwest of B.C. under the jobs plan. However, developing B.C.'s renewable, clean energy resources creates jobs all over the province. This helps all B.C. communities, including First Nation communities, to be part of expanding the B.C. economy and contributing to provincial tax and other revenues.

Mines, in particular, consume a lot of electricity, and the jobs plan calls for eight new mines by 2015 and expansion of at least nine existing mines. So the question our group is asking is how we're going to power these new mines and the increased industrial activity coming to this province.

We believe we need to do it right and serve new load growth for new industrial activity the right way, with clean energy from renewable resources. Each new mine that starts up employs thousands of skilled workers with high-paying jobs and brings in billions of dollars worth of investment, while providing tax dollars for the government coffers.

A recent report commissioned by the Canadian Wind Energy Association, CanWEA, has identified likely new electricity loads for B.C. and concluded that additional demand will hit 12,000 gigawatt hours of electricity in 2017 and 24,000 gigawatt hours by 2025. These new load forecasts are more than double B.C. Hydro's forecasts of only 5,800 gigawatt hours by 2017 and only 6,500 by 2025, of additional electricity load.

Clearly, we need to prepare now for greater future demand. In their report, WindVision, the Canadian Wind Energy Association believes that the shares of wind energy alone, as a percentage of total generation in the province, can increase from 1 percent of electricity demand currently to 17 percent by the year 2025.

WindVision would generate 7,500 person years of employment over the 20- to 25-year life span of the wind energy projects. Adding to this the escalation of development of other green energy, such as biomass and run of river, will increase the supply we have available to trade, developing, job-creating, tax-reducing benefits for all British Columbians.

The fulfilment of WindVision would result in $16 billion of investment in the province, with over $3.7 billion of direct benefits to B.C. communities. Implementing WindVision would generate an estimated 22,500 person-years of employment during construction and 7,500
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person-years of employment over the 20- to 25-year life span of the wind energy projects. And this is just the net benefits of wind energy alone.

As we've learned from the example of W.A.C. Bennett, no matter how we build it or how much it costs, our power will be the cheapest in North America 20 years from now.

B.C. has long been an exporter of clean energy, but only in the last decade have we become net importers of electricity, due to a lack of generating capacity occasioned by growth in our population and industrial base.

Developing our province's other renewable energy sources, such as wind energy and run of river, will increase the supply we have available to trade and export. This has enormous potential to add significantly to the province's revenues.

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If B.C. wants to be a climate change leader, as the jobs plan states, then we need to stay the course with all renewable energy development and our self-sufficiency plan and not miss the opportunity we have to meet future electricity load growth in our province the right way with renewable, clean energy. Today's renewable energy is tomorrow's cheap electricity.

We congratulate the government for their vision to encourage development of tomorrow's cheap electricity. What we're asking you to consider in relation to the province's budget is to ensure that we are properly leveraging B.C.'s renewable energy advantage for the benefit of B.C. taxpayers. By finding ways to escalate the development of all of our green energy potential, you will create investment, jobs and future revenue to help reduce taxes that will make the most attractive and competitive jurisdiction in North America.

We recognize that current global economic conditions, particularly in the United States, are not that good. This has temporarily reduced demand for electricity, but poor economic conditions will not last forever. Now is the time for B.C. to be building networks of renewable energy generating capacity.

B.C. Citizens for Green Energy released a research report entitled A Triple Legacy for Future Generations: British Columbia's Potential as a Renewable Green Energy Powerhouse a couple of years ago, in which we outline B.C.'s immensely untapped potential for generating renewable green energy and the substantial revenue that could potentially be generated for the people of B.C. through an effective export policy.

In our report we looked at several widely available estimates of B.C.'s potential for generating renewable green electricity. Based on these, we found that B.C.'s green-energy-generating potential could easily be equal to the current clean, renewable generating capacity available from B.C. Hydro's heritage hydroelectric dams and potentially two to three times that amount, if not more.

Everyone in B.C. stands to benefit greatly from the development of our province's enormous green energy potential, and the benefits are ones that would be there for our children, our grandchildren and for generations to come. B.C. jobs plan is green renewable energy.

I thank the committee for your time and consideration and for considering the important role that developing our province's immense green energy resources has for the B.C. economy and for provincial revenues.

R. Howard (Chair): You're well within time. That's good, because we have some questions.

D. Field: Yeah, very good — eight minutes. Go ahead.

B. Bennett: Hello, David.

D. Field: Hi, Bill. How are you doing?

B. Bennett: Good. So what do you figure has happened that's caused a different perspective from government over the past year?

D. Field: That was outlined in the report that was commissioned by CanWEA, by a couple of gentlemen in the Lower Mainland who are experts in studying this. In 2010 was when B.C. Hydro did the report. At that time — and I'll be quite honest — they did not take into account these new mines. They have only come on line recently. That has a lot to do with the projected construction of the NTL, which is the northern transmission line, and the northeast transmission line.

So as soon as you build the line that is available to carry electricity, that opens up the opportunity to build mines. As soon as you put mines on the grid, where are you going to get the energy to supply those mines?

I have some numbers here. You might be familiar with this. They want to also build liquid natural gas terminals — three of them. So if you add the expansion of eight new mines plus the liquid natural gas, you're looking at an increase of about 12,000 gigawatt hours.

For those of you who might not know, 1 gigawatt is 1 trillion watts. That's a capacity. That's a measurement of energy over time.

B. Bennett: Site C is 900 gigawatts.

D. Field: Site C is 900 megawatts.

B. Bennett: Megawatts.

D. Field: I'll give you some relative numbers about that. The 900 megawatts, because it's more or less firm energy, equates to about 4,800 gigawatt hours of electricity. So you can easily see by the projected numbers by
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2025, we'd need 2½ Site Cs. We don't have 2½ Site Cs available; we've got one. It would take ten years to build if it was started today.

Clearly, the demand is going to outstrip the capacity to supply it. So you're going to have to look at alternatives. The alternatives are run of river, wind. Solar is coming down in price. They're starting to look at that in California. So all of these renewable energy resources are coming down in price and making it affordable for both B.C. Hydro and for the renewable energy industry to install.

Did that answer your question?

D. Hayer: Thank you very much, David, for a good presentation.

We have one business in Surrey, in my constituency, in Port Kells, that supplies government wind energy.

My question to you is: how much would this cost the province to encourage your sector to create more jobs? Is there any cost to the province? Why isn't the province doing it? Why shouldn't it do it? Are there any negative impacts for doing this? I'm just trying to find out.

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D. Field: Well, it's not my sector. It's the Independent Power Producers. Typically, wind farms, as we know, are built by the private sector. B.C. Hydro, the utilities, is cognizant of building dams. But they're capable of building run-of-river installations. I've worked on some.

The current price to generate electricity now is coming down. If you can supplement that with storage capacity, like lithium-ion batteries, the price for installation is around $2 million per megawatt hour. That puts it in line with…. Run of river is typically around $2.5 million per megawatt hour for capacity. So wind is clearly coming down in price. You're looking at solar panels — by 2012, next year, will be $1 per watt hour. So you do that by the millions, and it's $1 million per megawatt hour.

They're gearing up big-time. They're putting solar farms in California, in Texas, combining that with battery energy storage to deliver electricity during peak demand times.

So clearly, the price of installing these things is coming down, and it's making it affordable. Because of the innovations that they're seeing, the price of lithium batteries coming down, the price of wind generators — the more they build, the cheaper they are.

D. Hayer: So there's no cost to B.C. taxpayers by doing this?

D. Field: What will happen is that typically you'll see the costs that are initiated by B.C. Hydro. They typically issue long-term, 20- to 30-year contracts with these wind farms, so they'll typically start off at around 6½ cents or 8½ cents. So you take a look at what we're paying today. On average it's 7 cents per kilowatt hour in your household. It's typically about half that for commercial and residential. But that's today. We all know the price of electricity is going up.

When they get locked into long-term contracts, they get half the inflation rate increase each year. So clearly, you're looking at five, ten, 15, 20, 30 years down the road. The incremental costs of what they're paying the IPPs to what they're actually charging and selling to the consumer will be more.

So in effect, by signing these long-term contracts and installing them now, B.C. will be at net benefit down the road. Because as we all know, the price of electricity has to go up.

D. Hayer: Down the road.

D. Field: Well, yeah. Look at Ontario. It's 50 percent in the next five years for their electricity.

D. Donaldson (Deputy Chair): Good to see you again. Rather than spending a billion dollars on smart meters, which this government has decided to do, would it be the preference of your interest group to have seen that billion dollars put into incenting the development of green energy?

D. Field: To be quite honest, I see a real net advantage to having the smart meters in. In other jurisdictions where they've put smart meters in, they've noticed a 10 percent decrease in the use of electricity. In institutions where they haven't even used smart meters — they've just put simply a display box that tells people how much electricity and when they're using it — they've noticed a 3 percent to 4 percent reduction.

B.C. Hydro wants to see a net decrease in demand for electricity. That's what B.C. Hydro has — a demand-side management group that works for them. A 10 percent reduction means that that's energy that they don't have to build.

So I think that the smart meters are a great program. I've received my letter in the mail saying they're going to install it within the next month. I'm looking forward to getting it.

R. Howard (Chair): MLA Pimm, to wrap it up.

P. Pimm: Thanks, David. That was a great presentation.

I can tell you I'm a firm believer that I think we need all the energy we can get. I have no problem saying that we should be a net exporter.

My question to you is: how do we help your industry get into the game in a better way and help with
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longer-term contracts? That sort of thing. How do we make that happen without raising our prices of hydro too high? That seems to be something we went through with Hydro.

D. Field: Well, you have to take a look at what Hydro's projected. Two years ago I attended a conference, and I asked the same question of Bev Van Ruyen. I said: "Have you taken into account industrial growth? Have you taken into account electric cars? Have you taken into account fuel switching and expansion of public transit?" Quite frankly, her answer to all those questions was: "No, we haven't." So it's quite evident. And this was two years ago — 2009.

I'm not criticizing any one group. I'm not here to do that. I'm just saying that you have to be really realistic and look at what B.C. wants to do. They want to open up mines for export, for our mineral resources, which we have in abundance. In order to do that, we want to export liquid natural gas, because they can get three times the price for that liquid natural gas in Asia than they can get here.

So clearly, we want to do all that. We want to build these installations. We want to create jobs, create revenues, royalties. B.C. Hydro has to then look at the long term. They can't just look at 2015 and…. They have to look really far down the road and get a firm grasp and then say: "Okay. What is it we're going to need to meet those demands in the future?" And it's going to be a partnership. It has to be an equal partnership between B.C. Hydro and the private companies that are expert at building these things.

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You know, most wind farms — across Canada and offshore — are all built by private organizations. They get the funding by other sources. So B.C. Hydro doesn't have to pay for it. They just simply buy the electricity at what I consider to be an inexpensive rate.

Does that answer your question?

P. Pimm: I think that's good.

R. Howard (Chair): Excellent, David. We've consumed your time. We appreciate you coming out this afternoon.

D. Field: Again, I'm glad I left more time for questions. Thank you very much for your questions, and thank you very much for your time.

R. Howard (Chair): That's great. Thank you.

Members, we will adjourn now and reconvene tomorrow morning at nine o'clock in Chilliwack.

The committee adjourned at 4:36 p.m.

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